Ingram Yuzek Gainen Carroll & Bertolotti, LLP v McCullar

[*1] Ingram Yuzek Gainen Carroll & Bertolotti, LLP v McCullar 2022 NY Slip Op 50466(U) Decided on June 1, 2022 Supreme Court, New York County Lebovits, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on June 1, 2022
Supreme Court, New York County

Ingram Yuzek Gainen Carroll & Bertolotti, LLP, Plaintiff,

against

James McCullar, Defendant.



Index No. 655386/2021



Ingram Yuzek Gainen Carroll & Bertolotti, LLP, New York, NY (Daniel L. Carroll of counsel), pro se.

Schlam Stone & Dolan LLP, New York, NY (Jeffrey M. Eilender of counsel), for defendant.
Gerald Lebovits, J.

In this action to collect legal fees that are allegedly due but unpaid, plaintiff has asserted claims for breach of contract, account stated, unjust enrichment, and quantum meruit. Defendant moves to dismiss the entire action for failure to allege compliance with 22 NYCRR part 137 or, alternatively, to dismiss plaintiff's account stated, quantum meruit, and unjust enrichment causes of action as duplicating plaintiff's breach of contract claim. The branch of defendant's motion to dismiss the action is denied; the branch of the motion seeking dismissal of plaintiff's claims beyond breach of contract is granted.

Defendant argues that the action as a whole is subject to dismissal because plaintiff (i) did not provide notice of defendant's right under 22 NYCRR part 137 to arbitrate the parties' fee dispute; and (ii) did not allege in the complaint either that defendant was notified of the right to arbitrate and did not request arbitration, or that the dispute is not subject to arbitration in the first place. (See 22 NYCRR 137.6 [b] [describing these requirements].) Defendant's argument is without merit.

The parties' fee dispute is outside the scope of Part 137. As reflected in the complaint, the "amounts in dispute involv[e] a sum of . . . more than $50,000." (22 NYCRR 137.1 [b] [2]; see NYSCEF No. 5 at 2-4 [causes of action of complaint, seeking judgment "in the amount of at least $99,964.15"].) Defendant thus did not have a right to arbitrate the fee dispute here. And plaintiff sufficiently alleged that fact for purposes of § 137.6 (b) (2) by stating in the complaint an "amount of damages sought . . . beyond the maximum amount covered by" Part 137. (Wagner Davis P.C. v Gargano, 116 AD3d 426, 426 [1st Dept 2014].)

Defendant argues in the alternative that three of plaintiff's four causes of action are subject to dismissal as duplicative of the fourth, the breach-of-contract claim. This court agrees.

With respect to plaintiff's account-stated cause of action, there appears to be at least some inconsistency among decisions of the Appellate Division, First Department, about whether and when a plaintiff may simultaneously assert breach-of-contract and account-stated claims arising from the same contractual relationship. (Compare e.g. Vanpoy Corp., S.R.L. v Soleil Chartered Bank, 204 AD3d 486, 487-488 [1st Dept 2002] [modifying decision below to grant summary judgment dismissing plaintiff's account-stated claim "as duplicative of the breach of contract claim], with Unisol, Inc. v Kidron, 180 AD3d 570, 571 [1st Dept 2020] [holding that plaintiff's "account stated claim is independent of its breach of contract claim" and affirming the grant of summary judgment to plaintiff on that claim], with Sabre Intl. Sec., Ltd. v Vulcan Capital Mgt., [*2]Inc., 95 AD3d 434, 438 [1st Dept 2012] [explaining that "a claim for an account stated may not be utilized simply as another means to attempt to collect under a disputed contract" and reversing grant of summary judgment to plaintiff on that claim given factual disputes relating to the existence of a binding contract].) Plaintiff's arguments opposing dismissal of its account-stated claim are thus not without force.

That said, this court must follow the most recent appellate precedent on the issue. (See Vaughan v Leon, 94 AD3d 646, 649 n 2 [1st Dept 2012].) And since Unisol, the First Department has twice held that trial courts erred in declining to dismiss account-stated claims asserted along with breach-of-contract claims—once at the pleading stage and once at summary judgment. (See Vanpoy Corp., 204 AD3d at 487-488; Suverant LLC v Brainchild, Inc., 191 AD3d 513, 515 [1st Dept 2021] [in action in which a defendant conceded at pleading stage that the complaint stated a cause of action for breach of contract, modifying decision below to dismiss account-stated claim against that defendant].) Given the complete overlap both in the facts alleged in plaintiff's complaint to support the two claims and in the amounts underlying the two claims, this court concludes that plaintiff's account-stated claim merely duplicates its contract claim, and must be dismissed on that basis.

With respect to plaintiff's quantum-meruit and unjust-enrichment causes of action, this court agrees with defendant that these two causes of action—which seek the same amounts based on the same facts as plaintiff's contract claim—are subject to dismissal as duplicative. For the parties' reference, this court notes that in "moving to dismiss the unjust-enrichment claim as duplicative, defendant necessarily acknowledged that the invoices" sent by plaintiff to defendant evinced "a valid contract between the parties" covering the subject of the parties' fee dispute. (Hossam Hassan Elanwar Saber Hassn v Armouth Intl. Inc., 2020 NY Slip Op 50834[U], at *1 [Sup Ct, NY County July 21, 2020].)

Accordingly, it is

ORDERED that the branch of defendant's motion seeking dismissal of the action as a whole is denied; and it is further

ORDERED that the branch of defendant's motion seeking dismissal of plaintiff's account-stated, quantum-meruit, and unjust-enrichment causes of action is granted.

6/1/2022