Opinion
Nos. 2019-10770 2020-04051 Index No. 502993/15
07-26-2023
Kingston Check Cashing Corp., plaintiff-respondent, v. Nussbaum Yates Berg Klein & Wolpow, LLP, defendant/third-party plaintiff/second third-party plaintiff-appellant-respondent, et al., defendant; Republic Bank of Chicago, third-party defendant-respondent-appellant; Winne Banta Basralian & Kahn, P.C., et al., second third-party defendants-respondents.
Lewis Brisbois Bisgaard & Smith, LLP, New York, NY (Mark K. Anesh and Sarah A. Adam of counsel), for defendant/third-party plaintiff/second third-party plaintiff-appellant-respondent. Winne Banta Basralian & Kahn, P.C., New York, NY (Michael J. Cohen of counsel), for plaintiff-respondent and third-party defendant-respondent-appellant. Catalano Gallardo & Petropoulos, LLP, Jericho, NY (Matthew K. Flanagan and Timothy A. Jenks of counsel), for second third-party defendants-respondents.
Lewis Brisbois Bisgaard & Smith, LLP, New York, NY (Mark K. Anesh and Sarah A. Adam of counsel), for defendant/third-party plaintiff/second third-party plaintiff-appellant-respondent.
Winne Banta Basralian & Kahn, P.C., New York, NY (Michael J. Cohen of counsel), for plaintiff-respondent and third-party defendant-respondent-appellant.
Catalano Gallardo & Petropoulos, LLP, Jericho, NY (Matthew K. Flanagan and Timothy A. Jenks of counsel), for second third-party defendants-respondents.
COLLEEN D. DUFFY, J.P., LARA J. GENOVESI, DEBORAH A. DOWLING, JANICE A. TAYLOR, JJ.
DECISION & ORDER
In an action, inter alia, to recover damages for accounting malpractice, (1) the defendant/third-party plaintiff/second third-party plaintiff, Nussbaum Yates Berg Klein & Wolpow, LLP, appeals from an order of the Supreme Court, Kings County (Lawrence Knipel, J.), dated August 8, 2019, and (2) the defendant/third-party plaintiff/second third-party plaintiff appeals, and the third-party defendant, Republic Bank of Chicago, cross-appeals, from an order of the same court dated March 2, 2020. The order dated August 8, 2019, insofar as appealed from, denied that branch of the motion of the defendant/third-party plaintiff/second third-party plaintiff which was to disqualify counsel for the plaintiff and the third-party defendant. The order dated March 2, 2020, insofar as appealed from, upon reargument, adhered to a prior determination in the order dated August 8, 2019, denying that branch of the motion of the defendant/third-party plaintiff/second third-party plaintiff which was, in effect, pursuant to CPLR 3124 to compel disclosure of certain communications between the plaintiff and its counsel on the ground that the attorney-client privilege had been waived, and denied that branch of the motion of the defendant/third-party plaintiff/second third-party plaintiff which was, in effect, pursuant to CPLR 3124 to compel the second third-party defendants, Winne Banta Basralian & Kahn, P.C., and Winne Banta Hetherington Basralian & Kahn, P.C., to appear for a deposition and to answer questions seeking nonprivileged information. The order dated March 2, 2020, insofar as cross-appealed from, denied the cross-motion of the third-party defendant for summary judgment dismissing the third-party complaint.
ORDERED that the order dated August 8, 2019, is affirmed insofar as appealed from; and it is further, ORDERED that the order dated March 2, 2020, is modified, on the law and in the exercise of discretion, (1) by deleting the provision thereof denying that branch of the motion of the defendant/third-party plaintiff/second third-party plaintiff which was, in effect, pursuant to CPLR 3124 to compel the second third-party defendants to appear for a deposition and to answer questions seeking nonprivileged information, and substituting a provision therefor granting that branch of the motion, and (2) by deleting the provision thereof denying the cross-motion of the third-party defendant for summary judgment dismissing the third-party complaint, and substituting therefor a provision granting the cross-motion; as so modified, the order dated March 2, 2020, is affirmed insofar as appealed from; and it is further, ORDERED that one bill of costs is awarded to the third-party defendant, payable by the defendant/third-party plaintiff/second third-party plaintiff.
In order to disqualify counsel on the ground that he or she may be called as a witness, a party moving for disqualification must demonstrate that the testimony of the opposing party's counsel is necessary to the moving party's case, and that such testimony would be prejudicial to the opposing party (see S & S Hotel Ventures Ltd. Partnership v 777 S. H. Corp., 69 N.Y.2d 437, 446; Blue Diamond Group Corp. v Klin Constr. Group, Inc., 73 A.D.3d 958, 959). "Merely because an attorney 'has relevant knowledge or was involved in the transaction at issue' does not make that attorney's testimony necessary" (Talvy v American Red Cross in Greater N.Y., 205 A.D.2d 143, 152, affd 87 N.Y.2d 826, quoting S & S Hotel Ventures Ltd. Partnership v 777 S. H. Corp., 69 N.Y.2d at 445). "Testimony may be relevant and even highly useful but still not strictly necessary. A finding of necessity takes into account such factors as the significance of the matters, weight of the testimony, and availability of other evidence" (S & S Hotel Ventures Ltd. Partnership v 777 S. H. Corp., 69 N.Y.2d at 446; see Empire Med. Servs. of Long Is., P.C. v Sharma, 189 A.D.3d 1176, 1178).
Here, the defendant/third-party plaintiff/second third-party plaintiff, Nussbaum Yates Berg Klein & Wolpow, LLP (hereinafter Nussbaum), failed to demonstrate that the anticipated testimony of counsel for the plaintiff and the third-party defendant, Republic Bank of Chicago, would be necessary to Nussbaum's case and also that such testimony would be prejudicial to the plaintiff (see S & S Hotel Ventures Ltd. Partnership v 777 S. H. Corp., 69 N.Y.2d at 446; Empire Med. Servs. of Long Is., P.C. v Sharma, 189 A.D.3d at 1178; Levy v 42 Dune Rd., LLC, 162 A.D.3d 651). Accordingly, the Supreme Court did not improvidently exercise its discretion in denying that branch of Nussbaum's motion which was to disqualify counsel for the plaintiff and the third-party defendant (see Hudson Val. Mar., Inc. v Town of Cortlandt, 54 A.D.3d 999).
A waiver of the attorney-client privilege may be found where the client places the subject matter of the privileged communication in issue or where invasion of the privilege is required to determine the validity of the client's claim or defense and application of the privilege would deprive the adversary of vital information (see Siegel v Snyder, 202 A.D.3d 125, 132). Contrary to Nussbaum's contention, the Supreme Court, upon reargument, did not err in adhering to its prior determination denying that branch of its motion which was, in effect, pursuant to CPLR 3124 to compel disclosure of certain communications between the plaintiff and its counsel on the ground that the attorney-client privilege had been waived (see id. § 2221[d]).
Generally, "[t]here shall be full disclosure of all matter material and necessary in the prosecution or defense of an action, regardless of the burden of proof, by... a party" (id. § 3101[a][1]). On this record, the Supreme Court erred in denying that branch of Nussbaum's motion which was, in effect, pursuant to CPLR 3124 to compel the second third-party defendants, Winne Banta Basralian & Kahn, P.C., and Winne Banta Hetherington Basralian & Kahn, P.C., to appear for a deposition and to answer questions seeking nonprivileged information (see Jayne v Smith, 184 A.D.3d 557; Etzion v Etzion, 62 A.D.3d 646).
The Supreme Court should have granted that branch of the cross-motion of the third-party defendant which was for summary judgment dismissing the third-party cause of action seeking contribution as barred by General Obligations Law § 15-108(b) (see Rivera v 203 Chestnut Realty Corp., 173 A.D.3d 1085, 1087; Kagan v Jacobs, 260 A.D.2d 442, 443). There is no evidence in the record indicating that a release given by the plaintiff to the third-party defendant was not given in good faith (see United States Fire Ins. Co. v Raia, 121 A.D.3d 970, 971-972; Balkheimer v Spanton, 103 A.D.3d 603, 603; Ziviello v O'Boyle, 90 A.D.3d 916, 917).
"[T]he key element of a common-law cause of action for indemnification is not a duty running from the indemnitor to the injured party, but rather is a separate duty owed the indemnitee by the indemnitor" (Raquet v Braun, 90 N.Y.2d 177, 183 [internal quotation marks omitted]; see Razdolskaya v Lyubarsky, 160 A.D.3d 994, 997). The Supreme Court should have granted that branch of the third-party defendant's cross-motion which was for summary judgment dismissing the third-party cause of action seeking indemnification as the third-party complaint does not allege the existence of any duty owed by the third-party defendant to Nussbaum (see Raquet v Braun, 90 N.Y.2d at 183; Greenberg v Blake, 117 A.D.3d 683, 684; Balkheimer v Spanton, 103 A.D.3d at 604; Plemmenou v Arvanitakis, 39 A.D.3d 612, 614).
DUFFY, J.P., GENOVESI, DOWLING and TAYLOR, JJ., concur.