Opinion
No. 111535/2010.
2012-10-15
LITMAN, ASCHE & GIOIELLA, LLP, Plaintiff, v. Carl HASTING, Defendant.
Richard M. Asche Esq., Litman, Asche & Gioiella, LLP, New York, for Plaintiff. Allison M. Furman Esq., New York, for Defendant.
Richard M. Asche Esq., Litman, Asche & Gioiella, LLP, New York, for Plaintiff. Allison M. Furman Esq., New York, for Defendant.
LUCY BILLINGS, J.
Plaintiff law firm moves for summary judgment on plaintiff's second claim, for an account stated of $235,866.01. C.P.L.R. § 3212(b) and (e). For the reasons explained below, the court denies plaintiff's motion.
I. PLAINTIFF'S PRIMA FACIE CLAIM
Plaintiff's partner Russell Gioiella does not attest in an affidavit, but only affirms under penalty for perjury, see C.P.L .R. § 2106; Morrison Cohen LLP v. Fink, 81 AD3d 467, 468 (1st Dep't 2011); LaRusso v. Katz, 30 AD3d 240, 243 (1st Dep't 2006); Nazario v. Ciafone, 65 AD3d 1240, 1241 (2d Dep't 2009); Lessoff v. 26 Ct. St. Assoc., LLC, 58 AD3d 610, 611 (2d Dep't 2009), that his law firm “sent periodic invoices” to defendant for its services in defending him in a criminal action, where he was charged with participating in a tax shelter scheme while an employee and partner at the global accounting firm KPMG. Aff. of Russell M. Gioiella at 2. See Berkman Bottger & Rodd, LLP v. Moriarty, 58 AD3d 539 (1st Dep't 2009). Gioiella does not attest to any regular business mailing procedures that plaintiff followed: the dates or intervals when the invoices were transmitted, who transmitted them for the firm, by what means, or to what address. Nor do the invoices themselves indicate they were mailed or otherwise transmitted to defendant. E.g., People v. Torres, 99 AD3d 429, 2012 WL 4669673, at *1 (1st Dep't Oct. 4, 2012); Morrison Cohen Singer & Weinstein, LLP v. Brophy, 19 AD3d 161, 162 (1st Dep't 2005). See California Suites, Inc. v. Russo Demolition Inc., 98 AD3d 144, 152 (1st Dep't 2012); Goldberg, Wepron & Ustin, LLP, 83 AD3d 554, 555 (1st Dep't 2011); Roth Law Firm, PLLC v. Sands, 82 AD3d 675, 676 (1st Dep't 2011).
The key element of a prima facie account stated claim is transmission of an invoice to defendant, forming the predicate for his failure to object to the invoice within a reasonable time. Risk Mgm't Planning Group, Inc. v. Cabrini Medical Ctr., 63 AD3d 421 (1st Dep't 2009); RPI Professional Alternatives, Inc. v. Citigroup Global Mkts. Inc., 61 AD3d 618, 619 (1st Dep't 2009); Graubard Miller v. Nadler, 60 AD3d 499 (1st Dep't 2009); Rothstein & Hoffman Elec. Serv., Inc. v. Gong Park Realty Corp., 37 AD3d 206, 207 (1st Dep't 2007). See Morrison Cohen Singer & Weinstein, LLP v. Brophy, 19 AD3d at 162. Failure to object constitutes an assent to pay the invoice. Risk Mgm't Planning Group, Inc. v. Cabrini Medical Ctr., 63 AD3d 421;Graubard Miller v. Nadler, 60 AD3d 499;Rothstein & Hoffman Elec. Serv., Inc. v. Gong Park Realty Corp., 37 AD3d at 207.See A.O. Textile Inc. v. SEP Plus Inc., 57 AD3d 397 (1st Dep't 2008). Defendant's nonreceipt of invoices or his reasonably timely objections, on the other hand, will rebut an account stated. RPI Professional Alternatives, Inc. v. Citigroup Global Mkts. Inc., 61 AD3d at 619;Henry Loheac, P.C. v. Children's Corner Learning Ctr., 51 AD3d 476 (1st Dep't 2008); Ween v. Dow, 35 AD3d 58, 61 (1st Dep't 2006); Herrick, Feinstein LLP v. Stamm, 297 A.D.2d 477, 478–79 (1st Dep't 2002).
Even if Gioiella's bare allegation that “plaintiff sent periodic invoices” to defendant indicates Gioiella's personal knowledge and thus admissible evidence that the invoices were mailed or otherwise transmitted to defendant, Gioiella Aff. at 2, plaintiff acknowledges that defendant complained to plaintiff about the invoices. RPI Professional Alternatives, Inc. v. Citigroup Global Mkts. Inc., 61 AD3d at 619;Ween v. Dow, 35 AD3d at 61. According to Gioiella, defendant insisted that KPMG was obligated to pay for his defense in the criminal action charging him with participation in a tax shelter scheme as a KPMG employee and partner. See Brauner Baron Rosenzweig & Klein v. Roth, 25 AD3d 333, 334 (1st Dep't 2006); Cadwalader, Wickersham & Taft v. Klear, 303 A.D.2d 204 (1st Dep't 2003).
Gioiella maintains that he responded to defendant's complaint, by forwarding plaintiff's invoices to KPMG's attorney, only after defendant confirmed that all the invoices were “correct.” Id. at 5 & Ex. F, at 1. The email correspondence Gioiella presents to support this admission, however, nowhere shows that defendant in fact confirmed that the invoices, for either the fees he paid or the fees he still owed, were correct. A.O. Textile Inc. v. SEP Plus Inc., 57 AD3d 397;Cadwalader, Wickersham & Taft v. Klear, 303 A.D.2d 204. The correspondence indicates only that Gioiella requested that confirmation from defendant.
Even if defendant had confirmed the correctness of all the invoices, such confirmation would acknowledge only that they were the invoices he received, not necessarily that he voiced no objection to them. In seeking KPMG's payment for his benefit, he surely had every incentive to maximize KPMG's payment, rather than to minimize his obligation to plaintiff, because the more KPMG reimbursed plaintiff for its disputed bills, the more the reimbursement would resolve plaintiff's dispute with defendant.
Nor did defendant ever admit, even in his action against KPMG for payment of his attorneys' fees and expenses, that plaintiff's invoices, even just for 2005, were for amounts “necessarily incurred.” Reply Aff. of Russell M. Gioiella Ex. A, at 208. When asked that question, defendant responded: “I don't know.” Id. Those amounts, moreover, were less than the $200,000.00 retainer fee defendant already had paid plaintiff and not the disputed amount plaintiff claims here. Edelman v. Poster, 72 AD3d 182, 189 (1st Dep't 2010); RPI Professional Alternatives, Inc. v. Citigroup Global Mkts. Inc., 61 AD3d at 619;A.O. Textile Inc. v. SEP Plus Inc., 57 AD3d 397;Cadwalader, Wickersham & Taft v. Klear, 303 A.D.2d 204.
Partial payment of the invoices may establish their receipt, but not necessarily an assent to pay the unpaid remainder. RPI Professional Alternatives, Inc. v. Citigroup Global Markets Inc., 61 AD3d at 619.See A.O. Textile Inc. v. SEP Plus Inc., 57 AD3d 397;Henry Loheac, P.C. v. Children's Corner Learning Ctr., 51 AD3d 476. Here, moreover, plaintiff relies on defendant's partial payments against its invoices that defendant made as a retainer fee or deposit, before he received the disputed invoices. See LePatner & Assoc., LLP v. Horowitz, 81 AD3d 472 (1st Dep't 2011); Kramer Levin Naftalis & Frankel LLP v. Canal Jean Co., Inc., 73 AD3d 604, 605 (1st Dep't 2010).
II. DEFENDANT'S REBUTTAL
Most significantly, even if plaintiff establishes a prima facie account stated claim, defendant attests that he repeatedly voiced objections to plaintiff's invoices. While he does not specify all the dates when he objected, he does detail the content of his objections. First, plaintiff failed to follow defendant's instructions to curtail the scope of services in his defense, as defendant could ride on the coattails of the vigorous defenses mounted by more prominent KPMG partners and co-defendants, and he could locate and retrieve the pertinent evidence himself. A.O. Textile Inc. v. SEP Plus Inc., 57 AD3d 397;Cadwalader, Wickersham & Taft v. Klear, 303 A.D.2d 204;Herrick, Feinstein LLP v. Stamm, 297 A.D.2d at 479. Second, plaintiff's invoices provide no detail regarding the services performed, as established by the scant content of the invoices themselves. Ween v. Dow, 35 AD3d at 62.See Berkman Bottger & Rodd, LLP v. Moriarty, 58 AD3d 539.
In fact, due to the complete absence of any description of the services plaintiff performed, it is impossible to ascertain whether any of the services were even for defendant's defense, let alone whether they fell within the services defendant authorized. Goldberg, Wepron & Ustin, LLP, 83 AD3d at 555;Brauner Baron Rosenzweig & Klein v. Roth, 25 AD3d at 334;Cadwalader, Wickersham & Taft v. Klear, 303 A.D.2d 204. This gross imprecision in the invoices themselves is ground alone to deny plaintiff's motion. Goldberg, Wepron & Ustin, LLP, 83 AD3d at 555;Ween v.. Dow, 35 AD3d at 62.
Defendant points out that only on January 23, 2007, after 18 months of plaintiff's services, did he receive any invoices from plaintiff. Before then, defendant had paid plaintiff $450,000.00 and, after June 2006, never made another payment. Upon receiving the six invoices for services from August 2005 through January 2007 en masse, he responded in writing, but his objection to the invoices was only that plaintiff had not honored his “countless” requests for regular invoices, and consequently he was completely unaware of how much fees and expenses had been incurred. Aff. in Opp'n of Carl Hasting ¶ 9 & Ex. D. Defendant further attests, however, that shortly afterward he telephoned Gioiella to air defendant's complaints: Gioiella had completely disregarded defendant's request that plaintiff perform minimal work, and defendant would not pay the invoices received because they contained no description of the services rendered. RPI Professional Alternatives, Inc. v. Citigroup Global Mkts. Inc., 61 AD3d at 619;Ween v. Dow, 35 AD3d at 61–62;Herrick, Feinstein LLP v. Stamm, 297 A.D.2d at 479. This time frame is more specific, while defendant's alleged reiteration of his objections whenever Gioiella responded to defendant's telephone messages simply spans the entire period of plaintiff's continued representation.
Nevertheless, defendant does specify that each time he received an invoice, he complained orally to Gioiella. The next invoice defendant received was dated December 12, 2008, almost two years later. Again he complained about the absence of any description of the services performed or delineation of time spent on particular tasks and his inability to discern any basis for the bills. The next and final invoice defendant received was dated June 11, 2009. Once again defendant complained to Gioiella that defendant would not pay the invoice because it did not show what services plaintiff actually had performed. Again, the scant content of the invoices themselves establishes this fact.
Finally, and simply corroborating what Gioiella's own account and email correspondence reveal, defendant emphasizes that:
At no time did I represent to KPMG that I believed the fees charged by Plaintiff were reasonable or that I had accepted Plaintiff's invoices without prior objection.
Hasting Aff. ¶ 19. Insofar as he may have admitted in his action against KPMG for his attorneys' fees and expenses that he “owes these lawyers over $1 million,” he was referring to three other lawyers before and after plaintiff, as well as plaintiff. Gioiella Aff. Ex. H ¶ 50.
III. CONCLUSION
Defendant adequately rebuts plaintiff's allegations that he did not object to its invoices. Edelman v. Poster, 72 AD3d at 189;RPI Professional Alternatives, Inc. v. Citigroup Global Mkts. Inc., 61 AD3d at 619;Ween v. Dow, 35 AD3d at 61;Herrick, Feinstein LLP v. Stamm, 297 A.D.2d at 478–79. Plaintiff repeatedly asks the court to reject defendant's sworn statements as incredible, a determination that would be impermissible in the context of plaintiff's motion for summary judgment. E.g., Ferrante v. American Lung Assn., 90 N.Y.2d 623, 631 (1997); Sabre Intl. Sec., Ltd. v. Vulcan Capital Mgt., Inc., 95 AD3d 434, 436 (1st Dep't 2012); Gasperi v. Sadeh, 61 AD3d 405, 406 (1st Dep't 2009); McFadden v. Bruno, 37 AD3d 177 (1st Dep't 2007). Nor does anything in his recitation of his oral objections contradict his written protest of January 23, 2007, or his deposition testimony. Plaintiff asks defendant to explain why plaintiff would not have sent him its invoices before January 23, 2007, but, other than Gioiella's blanket allegation that his law firm “sent periodic invoices” to defendant, Gioiella Aff. at 2, which defendant admits it did three times, plaintiff nowhere specifies any other times it sent its invoices, nor explains why it did not. E.g., People v. Torres, 99 AD3d 429, 2012 WL 4669673, at *1;Morrison Cohen Singer & Weinstein, LLP v. Brophy, 19 AD3d at 161–62.See California Suites, Inc. v. Russo Demolition Inc., 98 AD3d at 152;Goldberg, Wepron & Ustin, LLP, 83 AD3d at 555;Roth Law Firm, PLLC v. Sands, 82 AD3d at 676.
Defendant's oral protests, moreover, are more than “bald allegations.” Darby & Darby v. VSI Intl., 95 N.Y.2d 308, 315 (2000). See RPI Professional Alternatives, Inc. v. Citigroup Global Mkts. Inc., 61 AD3d at 619;Ween v. Dow, 35 AD3d at 61;Herrick, Feinstein LLP v. Stamm, 297 A.D.2d at 478–79. They are specific in both content and context, following the specific dates of invoices defendant received, as well as “repeatedly” before and between those three occasions. Hasting Aff. in Opp'n ¶ 2. See id . ¶ 4; LePatner & Assoc., LLP v. Horowitz, 81 AD3d 472;Kramer Levin Naftalis & Frankel LLP v. Canal Jean Co., Inc., 73 AD3d at 604–605;Berkman Bottger & Rodd, LLP v. Moriarty, 58 AD3d 539.
The weaknesses in plaintiff's prima facie evidence, combined with defendant's rebuttal, as delineated above, require denial of plaintiff's motion for summary judgment on its account stated claim. C.P.L.R. § 3212(b). This decision constitutes the court's order.