Wednesday, October 11, 2017

Landlocked But Not Defaulted

The New York Appellate Division for the Second Judicial Department affirmed the grant of a motion to vacate default of the defendant in a legal malpractice case

The plaintiffs commenced this action against their former attorney alleging legal malpractice, fraud, and breach of fiduciary duty. The plaintiffs alleged that the defendant, who represented them in the purchase of their home, committed malpractice by, among other things, failing to determine that the home had no access to a public road and was therefore landlocked. The defendant failed to answer the complaint, and the plaintiffs moved for leave to enter a default judgment. The Supreme Court granted the motion and, following an inquest, entered a judgment against the defendant in the total sum of $1,372,458.52, which represented the sum of the purchase price of the house and the cost of improvements the plaintiffs had made after the purchase, plus interest and costs. The defendant moved to vacate the judgment entered upon his default and for leave to serve a late answer, arguing that he had a reasonable excuse for his default and a potentially meritorious defense. The court granted the motion, and the plaintiffs appeal.

Explanation accepted

Here, the defendant demonstrated a reasonable excuse for his default through the affidavit of his treating psychologist, which established that his default was due to diagnosed psychological conditions that rendered him unable to defend himself in this action at the relevant time. He also demonstrated a potentially meritorious defense to the complaint by, inter alia, submitting evidence that the property was not and had never been landlocked. In light of the defendant’s showing and the strong policy favoring adjudication of cases on the merits, the Supreme Court providently exercised its discretion in granting the defendant’s motion to vacate his default and for leave to serve a late answer.

(Mike Frisch)

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