Opinion
Index No. 151635/2019
04-02-2020
ANDREA KARAMBELAS, Plaintiff, v. COHEN GOLDSTEIN, LLP, and GLENN S. GOLDSTEIN, Defendants.
NYSCEF DOC. NO. 84
DECISION & ORDER
LOUIS L. NOCK, J.
Defendants - law firm and a member thereof - move (seq. no. 001) to dismiss the complaint in this legal malpractice action (CPLR 3211 [a] [1], [7]). The motion is opposed. The motion is granted for the reasons that follow.
BACKGROUND
Defendant Cohen Goldstein, LLP (the "Firm"), is a law firm that practices matrimonial and family law. Defendant Glenn S. Goldstein, Esq., is the member of the Firm who represented its former client, plaintiff Andrea Karambelas, in defense of a matrimonial proceeding commenced in Suffolk County and transferred to New York County, titled Kaplan v Karambelas (Suffolk County Index No. 017391/13; New York County Index No. 401958/13). The Firm was the third firm that had represented Ms. Karambelas in said proceeding. The Firm's relationship with Ms. Karambelas was by written retainer agreement dated March 18, 2015, as supplemented April 27, 2015. On May 4, 2016, the Firm was substituted by another attorney. Defendants' Representation of Plaintiff in the Matrimonial Action:
Ms. Karambelas is suing yet another of the law firms which represented her in the matrimonial action, for alleged malpractice, too - The Law Office of Mark S. Helweil - in a separate action before this court titled Karambelas v Law Office of Mark S. Helweil (New York County Index No. 150591/2019).
On April 17, 2015 - not yet having received its retainer payment from plaintiff, the Firm appeared in court on her behalf. At that appearance, the court rendered a decision on a pending motion by plaintiff, made by prior counsel, which sought to compel plaintiff's husband to produce all life insurance policies at the time he brought the divorce action (see, Defendants' Exh. "V" [transcript of April 17, 2015, appearance]). The court granted that motion and ordered plaintiff's husband to turn over the life insurance policies within 15 days. Plaintiff's husband did not comply with this order (id.). Contrary to a claim made by plaintiff herein that the Firm failed to properly conduct discovery, the court had advised that discovery had closed the day before the Firm even made its first appearance (id.). The court, therefore, denied the Firm's request to continue the deposition of plaintiff's husband, but allowed certain other discovery to take place (id.).
Despite the court's closing of discovery; on June 15, 2015, the Firm, nevertheless, filed a motion by Order to Show Cause, seeking an order: (i) granting interim attorneys' fees of $150,000.00, as well as the costs of that motion; (ii) holding plaintiff's husband in contempt for failing to pay monthly maintenance and to turn over the life insurance policies; (iii) granting a judgment for the amount of maintenance in arrears at that time, as well as any amounts that would become due pending the motion; (iv) directing the art auction house Christie's to release to plaintiff the amounts it was holding as a credit against plaintiff's husband's support obligations; (v) compelling plaintiff's husband to post security of $250,000.00 or to appoint a receiver to rent out a house owned by plaintiff and her husband, with the rent to be used to pay plaintiff's support; and (vi) compelling plaintiff's husband to turn over additional documents (see, Defendants' Exh. "J" [June 15, 2015, Motion]). On November 20, 2015, the court denied the request for $150,000.00 in light of plaintiff's receipt of a $500,000.00 line of credit, but did award plaintiff $20,000.00 in connection with the costs of that motion (see, Defendants' Exh. "K" [November 20, 2015, Order]). The court directed a contempt hearing be held regarding the nonpayment of support and the failure to disclose all life insurance policies (id.). The court also found that plaintiff's husband's arrears were $75,975.83 and directed the entry of a money judgment if payment was not made (id.). The court further denied plaintiff's request for security or a receiver, and the request relating to Christie's was resolved by a stipulation between the parties (id.).
Throughout its tenure as plaintiff's attorneys, the Firm took significant other actions, including collection of maintenance arrears; defeating plaintiff's husband's motion for a downward modification of his obligations; subpoenaing documents relating to plaintiff's husband's life insurance policies; and moving to reopen discovery. The Termination of the Relationship Between Plaintiff and the Firm:
Despite her obligations under the retainer agreement, plaintiff failed to pay the Firm its fees. On May 4, 2016, the Firm was replaced as counsel in the divorce action. Subsequent counsel tried the case in the summer of 2018. On August 1, 2018, before a final judgment was rendered, plaintiff's husband died. As a result, the divorce action was abated and dismissed.
DISCUSSION
Standard of Review on this Motion:
When deciding a motion to dismiss pursuant to CPLR § 3211 (a)(7), the court must merely determine whether the pleadings state a cause of action (e.g., Loukoumi, Inc. v Margaritis, 285 AD2d 595 [2d Dept 2001]). While the complaint is assumed to be true and the plaintiff is accorded every favorable inference, "[t]his liberal standard . . . will not save allegations that consist of bare legal conclusions or factual claims that are flatly contradicted by documentary evidence or are inherently incredible" (Hyman v Schwartz, 127 AD3d 1281, 1283 [3d Dept 2015]; see also, Loukoumi, supra, 285 AD2d at 595-96). Further, where documentary evidence "definitively contradicts the plaintiff's allegations and conclusively disposes of the plaintiff's claim," dismissal pursuant to CPLR 3211 (a)(1) is warranted (Berardino v Ochlan, 2 AD3d 556, 557 [2d Dept 2003]). When such evidence is submitted, the motion to dismiss "standard morphs from whether the plaintiff stated a cause of action to whether it has one" (Basis Yield Alpha Fund (Master) v Goldman Sachs Group, Inc., 115 AD3d 128, 135 [1st Dept 2014]).
As will be discussed, even taking as true all of the allegations in the complaint, plaintiff's causes of action against the defendants are definitively contradicted by documentary evidence and, therefore, should be dismissed. Moreover, as will be discussed, plaintiff cannot make out proximate cause for her claims of malpractice. Documentary Evidence Refutes Plaintiff's Claims of Malpractice:
Plaintiff asserts five causes of action against the defendants. However, all of these claims are conclusively refuted by documentary evidence and must be dismissed pursuant to CPLR 3211(a)(1). A motion to dismiss based on documentary evidence may be granted "where the documentary evidence utterly refutes plaintiff's factual allegations, conclusively establishing a defense as a matter of law" (Goshen v Mutual Life Ins. Co., 98 NY2d 314, 326 [2002]). Here, the documentary evidence, in the nature of court filings, court orders, and correspondence between the parties, demonstrates that the factual allegations that form the basis of plaintiff's claims are disproven. As such, the complaint should be dismissed in its entirety.
Documentary Evidence Demonstrates that the Firm Moved for Legal Fees:
Plaintiff's first claim is that the Firm failed to take legal action to enforce her husband's obligation to pay her legal fees. However, on June 15, 2015, the Firm made a motion seeking various categories of relief for plaintiff, including an award of interim attorneys' fees (see, Defendants' Exh. "J" [Order to Show Cause]). Subsection (i) of that motion's Order to Show Cause asked for an order pursuant to DRL 237(a), directing plaintiff's husband to pay $150,000.00 for the interim counsel fees and expenses. The court eventually denied the relief sought because plaintiff obtained a $500,000.00 line of credit, although the court still granted the costs of making the motion (see, Defendants' Exh. "K" [November 20, 2015, Order]). The plain text of this signed Order to Show Cause refutes the factual allegation underlying the first cause of action, i.e., that "[t]he defendants failed and refused to take the actions necessary to timely submit and prosecute to a conclusion a motion to compel the plaintiff's husband to comply with his legal obligation to pay and/or reimburse the plaintiff for the costs of legal services provided to her in the Divorce Action . . . ." (Complaint ¶ 9.) Thus, this cause of action must be dismissed pursuant to CPLR 3211(a)(1).
Documentary Evidence Demonstrates that the Firm Moved for Maintenance and Arrears:
Plaintiff's second cause of action is likewise refuted by documentary evidence. Plaintiff alleges that the Firm failed to take action to enforce plaintiff's husband's obligation to pay maintenance and maintenance arrears during the divorce action. However, in the same motion discussed above, the Firm moved for an order holding plaintiff's husband in contempt for failing to comply with the court orders requiring him to pay maintenance, and for a money judgment for the maintenance arrears plus any amounts that would become due during the pendency of the motion (see, Defendants' Exh. "J" [Order to Show Cause]). That same motion also sought to release funds being held by a debtor of the plaintiff and to establish a security fund, all of which would have the effect of satisfying plaintiff's husband's obligation to pay maintenance and arrears. This clearly refutes the factual allegations forming the basis of this cause of action and, as such, this claim must also be dismissed.
Documentary Evidence Demonstrates that the Firm Moved to Hold Plaintiff's Husband in Contempt Regarding the Life Insurance Policies:
Documentary evidence also refutes plaintiff's third cause of action. Plaintiff alleges that the Firm failed to take action to ensure her husband reinstated certain life insurance policies and to ensure that she was the named beneficiary (Complaint ¶ 24). But on April 17, 2015, at the Firm's first court appearance on plaintiff's behalf, the court issued an order granting a prior motion, requiring plaintiff's husband to "reinstate and/or maintain any and all life insurance policies which were in existence at the commencement of these proceedings . . . and to provide documentation" to plaintiff within fifteen days (see, Defendants' Exh. "S" [April 17, 2015, Decision]). Plaintiff's Husband failed to comply with this order; so on June 15, 2017, as part of the same motion made by the Firm, the Firm sought an order holding plaintiff's husband in contempt (see, Defendants' Exh. "J" [Order to Show Cause]). The Firm, further, subpoenaed documents from plaintiff's husband's life insurance carriers to demonstrate that he was not complying with his legal obligations to maintain his life insurance policies. The court granted the Firm's request for a contempt hearing; but plaintiff then unilaterally replaced the Firm as her counsel before the contempt proceedings could be completed. Thus, the documentary evidence in the nature of the Firm's motion; subpoenas; the court orders; and the contempt hearing refute the factual allegations underlying this claim, i.e., that the Firm failed to take actions to ensure that plaintiff's husband reinstate and maintain the life insurance policies under which she was a beneficiary. As the documentary evidence refutes this claim, it must be dismissed.
Documentary Evidence Demonstrates that the Firm Moved for Additional Discovery:
Plaintiff's fourth cause of action must also be dismissed because it is refuted by documentary evidence. Plaintiff alleges that the Firm "failed and refused to timely pursue the additional discovery, including, but not limited to, the continued deposition of the plaintiff's husband" (Complaint ¶ 33). However, this is factually inaccurate, as demonstrated by the transcript of the Firm's first appearance in the divorce action, as well as the Firm's June 15, 2017, motion, and a subsequent motion on February 3, 2016, to reopen discovery. The automatic orders required under 22 NYCRR 202.16-a(b) and (c)(5) require that plaintiffs in divorce actions maintain all existing life insurance policies, and preclude such plaintiffs from changing the beneficiaries of any existing life insurance policies. They also require defendants in such actions to do the same, but only from the date they are served with the summons; not from the date of the filing of the summons, obviously.
On April 17, 2015, at the Firm's first appearance on behalf of plaintiff, the Firm advised the court that discovery was not completed (see, Defendants' Exh. "V" [transcript of April 17, 2015, appearance]). The court advised the Firm that discovery had closed prior to that first appearance by the Firm and specifically ruled that no further depositions of plaintiff's husband could occur, preventing the Firm from pursuing the discovery that plaintiff alleges she was entitled to (id.). On June 15, 2017, the Firm moved for an order "[d]irecting the defendant [i.e., plaintiff's husband] to produce for inspection and copying all statements and canceled checks on all his accounts in all out-of-state banks, all police incident reports, all statements from any lines of credit with Chase, and the current homeowner's insurance policy on the Watermill Residence" (Defendants' Exh. "J" [Order to Show Cause], subsection [g]).
The Firm then moved on February 3, 2016, to reopen discovery (see, Defendants' Exh. "Q" [Feb. 3, 2016, Motion, subsection [b]). The Firm also issued subpoenas for many other documents from third parties (see, Defendants' Exh. "X" [Subpoenas]). Plaintiff removed the Firm as counsel before the court rendered a decision on this motion. These documents demonstrate that the Firm did, in fact, take action to reopen and continue discovery in the divorce action, disproving the factual allegations forming the basis of the fourth cause of action. Therefore, this claim should be dismissed.
Documentary Evidence Demonstrates that the Firm Did Not Force Plaintiff to Sign the "Churchill Contract":
The Factual Backdrop of this Claim:
On April 2, 2015, before plaintiff officially retained the Firm, plaintiff's application to a litigation funding firm called "Novitas" was approved (see, Defendants' Exh. "Y" [Email from Novitas]). On April 10, 2015, Nicole Noonan of Novitas advised defendant Glenn Goldstein, Esq., that she would be sending a form for him to sign (Defendants' Exh. "BB" [Email from Noonan]). Upon receipt, Mr. Goldstein sent proposed changes but received no immediate response (see, Defendants' Exh. "CC" [Email with proposed changes]). On April 12, 2015, plaintiff advised Mr. Goldstein that Novitas would not be making a decision regarding the proposed changes before the next scheduled appearance in the divorce action, which was scheduled for April 17, 2015 (see, Defendants' Exh. "DD" [Email regarding Novitas' response]). Plaintiff also offered that, if Novitas did not approve the proposed changes, she could immediately get funding through another litigation funding firm called "Churchill," by which she had already been approved (id.).
On April 15, 2015, plaintiff advised the Firm that she was "in secret dialogue" with Churchill regarding funding (Defendants' Exh. "GG" [Email re: Churchill]). The next day, on April 16, 2015, plaintiff advised that she would be "good to go with" Churchill (Defendants' Exh. "HH" [Email re: Churchill]). On April 26, 2015, having received no response from Novitas, plaintiff advised the Firm that she was "expediting" the agreement with Churchill, which she had signed on April 22, 2015 (see, Defendants' Exhs. "LL" [Email from plaintiff], "NN" [April 26, 2015, email], "OO" [Email with signed Churchill loan documents]). Plaintiff decided, without the Firm's involvement, at all, to sign the Churchill contract (see, Defendants' Exh. "MM" [Email to Mr. Goldstein]).
Plaintiff's Claim Related to the "Churchill Agreement"
In her fifth cause of action, plaintiff alleges that she was forced to enter into a less favorable litigation financing agreement than the one she originally wanted because the Firm would not sign a contract with Novitas (Complaint ¶¶ 39-44). However, as detailed above, and summarized now, the correspondence from plaintiff demonstrates that she independently made the decision to use Churchill as her litigation funder due to a lack of response from Novitas. Shortly after contacting the Firm, plaintiff advised that she had entered into certain preliminary agreements with Novitas. On April 10, 2015, Novitas said it would send the Firm an "Attorney Acknowledgement and Agreement" form (Defendants' Exh. "BB" [Email from Noonan]). Upon reviewing the form, the Firm immediately sent proposed changes to Novitas, but never received a response (Defendants' Exh. "CC" [Email with proposed changes]). Plaintiff decided, without any input from the Firm, to pursue a contract with Churchill instead (see, Defendants' Exhs. "GG" [plaintiff advising that she had been in "secret dialogue" with Churchill], "NN" [plaintiff advising that she was "expediting" the Churchill contract]). In fact, the Firm specifically advised plaintiff in writing that it was not able to advise her regarding the contract with Churchill (see, Defendants' Exh. "MM" [Email from Mr. Goldstein]). Plaintiff then went forward on her own and executed the funding contract with Churchill.
Thus, the documentary evidence clearly demonstrates that plaintiff entered into her agreement with Churchill of her own accord. As the documentary evidence utterly refutes plaintiff's factual allegations in this regard, this cause of action must also be dismissed. Plaintiff Cannot Establish Proximate Cause for her Allegations of Malpractice:
Plaintiff cannot possibly sustain her claims of malpractice on the Firm's part because the Firm ceased being plaintiff's counsel in the divorce action more than two years before the divorce case was abated and dismissed due to plaintiff's husband's death. New York law is clear that when an attorney-client relationship is terminated and successor counsel has sufficient time to correct any alleged error, then the terminated attorney cannot be held to have proximately caused his former client's alleged damages, if any (see, Somma v Dansker & Aspromonte Assocs., 44 AD3d 376 [1st Dept 2007]; Golden v Cascione, Chechanover & Purcigliotti, 286 AD2d 281 [1st Dept 2001]; see also, Davis v Cohen & Gresser, LLP, 160 AD3d 484 [1st Dept], lv denied 32 NY3d 911 [2018]; Albin v Pearson, 289 AD2d 272 [1st Dept 2001]).
Here, plaintiff alleges that the Firm failed to take legal action to enforce her rights to (i) payment of her legal fees by her husband; (ii) maintenance and arrears; (iii) certain discovery; and (iv) reinstatement and maintenance of her husband's life insurance policies before her husband died and the divorce action was abated and dismissed. Putting aside the fact that, per the discussion above, the Firm did, in fact, take legal action to enforce these rights, plaintiff's successor counsel had over two years to correct any alleged mistakes before the case was abated and dismissed. Plaintiff does not allege that any action by the Firm hindered her future abilities through substitute counsel in any way. Thus, plaintiff cannot establish that the Firm proximately caused her any damages. Thus, all her claims for legal malpractice must be dismissed based on this reasoning.
Accordingly, it is
ORDERED that defendants' motion to dismiss the complaint is granted and, therefore, the complaint is dismissed.
This shall constitute the decision and order of the court. Dated: New York, New York
April 2, 2020
ENTER:
/s/_________
Hon. Louis L. Nock, J.S.C.