Tuesday, August 11, 2009

Allegations Sufficient To Sustain Malpractice Claim

The New York Appellate Division for the First Judicial Department concluded that a complaint alleging legal malpractice had been improperly dismissed by the trial court. The allegations related to a settlement in a divorce action. The court held:

Here, not only are the allegations of the giving of incorrect advice sufficient and nonconclusory, as noted above, the documentary evidence provides significant support for plaintiff's claim. It clearly establishes that the overwhelming majority of plaintiff's funds, including the amount necessary to satisfy the obligation to his wife, were not, as characterized by the stipulation, "immediately available." Plaintiff alleges that he did not know that under the applicable tax laws the necessary funds were not "immediately available" — we must accept that allegation as true (see Leon v Martinez, 84 NY2d 83, 87 [1994]) —- and that a reasonably competent matrimonial attorney who read the stipulation would not have advised him to sign it. Given these allegations, the stipulation may constitute evidence of defendants' negligence and does not constitute a defense to the malpractice claim.

Furthermore, defendants' assertion that plaintiff's alleged damages are too speculative lacks merit. To survive a preanswer motion to dismiss... "a pleading need only state allegations from which damages attributable to the defendant's conduct may reasonably be inferred." At this early stage of the proceedings, plaintiff " is not obliged to show . . . that [he] actually sustained damages,'" but only that "damages attributable to [defendants' conduct] might be reasonably inferred." The complaint sufficiently asserts that "but for" defendants' faulty advice that plaintiff sign the stipulation, he would not have incurred the tax liability that resulted from the withdrawal of funds from his retirement account. We do not regard as pure speculation plaintiff's contention that in no event would he have incurred that liability if the settlement had not been reached.(citations omitted)

(Mike Frisch)

http://lawprofessors.typepad.com/legal_profession/2009/08/the-new-york-appellate-division-for-the-first-judicial-department-concluded-that-a-complaint-alleging-legal-malpractice-had-b.html

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Comments

The court's opinion, while perhaps correct, illustrates why so many people (even some smart lawyers) have trouble understanding the significance of a court's decision not to dismiss a complaint. On a motion to dismiss for failure to state a claim, a court accepts as possibly true any ostensible fact that the complaint asserts.

This court does not say that it's true that the plaintiff did not know the terms of his retirement plan and so innocently relied on his lawyer's advice. Rather, the court says only that it's possible that later there could be statements that might persuade a finder of fact to find that the claim is shown by some preponderance of the evidence presented.

Posted by: Peter Gulia | Aug 11, 2009 11:56:03 AM

Peter said: The court's opinion, while perhaps correct, illustrates why so many people (even some smart lawyers) have trouble understanding the significance of a court's decision not to dismiss a complaint. On a motion to dismiss for failure to state a claim, a court accepts as possibly true any ostensible fact that the complaint asserts.

Great Point Peter, and the court's decision was just.

Posted by: medical malpractice in manhattan | Aug 12, 2009 7:19:31 AM

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