| Kram Knarf, LLC v Djonovic |
| 2010 NY Slip Op 05464 [74 AD3d 628] |
| June 22, 2010 |
| Appellate Division, First Department |
| Kram Knarf, LLC, et al., Respondents, v ValentinDjonovic et al., Appellants. |
—[*1] Schwartz & Ponterio, PLLC, New York (Matthew F. Schwartz of counsel), forrespondents.
Order, Supreme Court, Bronx County (Nelson S. RomÁn, J.), entered on or aboutNovember 28, 2008, which denied defendants' motion to dismiss the complaint, affirmed,without costs.
Accepting the facts alleged in the complaint as true and according plaintiffs the benefit ofevery possible favorable inference (see Leon v Martinez, 84 NY2d 83, 87-88 [1994]), weagree that the allegations that defendant attorneys negligently gave their plaintiff clients anincorrect explanation of the contents of legal documents in connection with a propertyacquisition sufficiently states a legal malpractice claim against them (see Arnav Indus., Inc.Retirement Trust v Brown, Raysman, Millstein, Felder & Steiner, 96 NY2d 300 [2001]; cf. Bishop v Maurer, 33 AD3d497, 499-500 [2006], affd 9NY3d 910 [2007]). The documents do not conclusively establish that defendants'explanation was correct, and thus do not constitute a defense based on "documentary evidence"(CPLR 3211 [a] [1]).
Bishop v Maurer (9 NY3d910 [2007], supra), relied on by the dissent, does not dictate a different result.There, the client had given informed consent, confirmed in writing, to the attorneys' dualrepresentation of him and his wife. The client's malpractice complaint was silent as to how theattorneys misled him, what they failed to explain to him concerning the estate planningdocuments he executed, and which of his instructions those documents did not reflect (33 AD3dat 498-499).
Here, in contrast, plaintiffs' complaint alleges with particularity that their interests were notprotected by the contract in accordance with their instructions, and that defendants advisedplaintiffs incorrectly as to the contract's import. For instance, it is alleged that defendants failedto perform due diligence in order to ascertain the extent of the contamination and that the levelsof contamination exceeded the levels represented to plaintiff by the owner. Thus, while thecontract disclosed certain liabilities, without the proper due diligence and adequate legal counsel,plaintiffs were unaware of the full extent of the liabilities they faced. Concur—Gonzalez,P.J., Saxe, Acosta and Abdus-Salaam, JJ.
McGuire, J. dissents in a memorandum as follows: This case is controlled by Bishop vMaurer (9 NY3d 910 [2007]). The issue is not whether the transaction documents"conclusively establish that defendants' legal advice was correct" (emphasis added). InBishop v Maurer, the claim of legal malpractice was entirely inconsistent with the estateplanning documents prepared by the attorney that the elderly decedent signed and is presumed tohave read. Here, too, the claim of legal malpractice is entirely inconsistent with the transactiondocuments prepared by attorneys that sophisticated clients signed and are presumed to have read.Here, as in Bishop v Maurer, "plaintiffs' complaint is devoid of any nonconclusoryallegation that incorrect advice was given" as to the contents of the documents (id. at911). If plaintiffs' vague allegations of incorrect advice are sufficient to state a claim for legalmalpractice, unsettling consequences are all but certain to follow. For example, legal malpracticeactions could be commenced based on a bare claim that the client was told he was getting moremoney to settle an action than is provided in settlement documents signed by the client. Notably,this is not a case in which the client, because of an error by the attorney, has "a valid excuse forhaving failed to read [the subject document]" (Arnav Indus., Inc. Retirement Trust v Brown,Raysman, Millstein, Felder & Steiner, 96 NY2d 300, 304 [2001]). For these reasons, themotion to dismiss should have been granted.