Legal Malpractice

It's Not When you Learn about it in Legal Malpractice

By (Andrew Lavoott Bluestone)

We are reminded yet again that the statute of limitations starts to run in legal malpractice on the day that the mistake is made.  It's not the day that you realize that a mistake was made.  This issue arises mostly in transactional representations, such as the lease in this case.  When there is litigation, then a continuous representation question comes into play, and plaintiffs usually know when the case ends.  Case endings, although not always a milestone, often provide a comfortable point of reference.

Here,  in Lincoln Place, LLC, Plaintiff, v. RVP Consulting, Inc., et al., Defendants. Robert Peters, et al., Third-Party Plaintiffs-Appellants, Michael E. Pekofsky, Esq., . 
plaintiff hired attorney to write up and administer a lease.  Things went wrong from the beginning, when there was an assignment rather than designating a lessee.  What is the difference?  In one, the plaintiff remained responsible for unpaid rents when the lessee stopped paying.  In the other, plaintiff would not have been responsible.

When and how was the mistake made?  When and how did plaintiff become aware?  When did the statute of limitations start to run?  To save the statue, plaintiff argues that a decision had to be made on the underlying case before he had the ability to sue.  This argument loses. Justice Kornreich of Supreme Court, New York County writes:

"The third-party complaint alleging legal malpractice is time-barred, the action having been commenced more than three years after the malpractice was committed (CPLR 214[6]; Ackerman v Price Waterhouse, 84 NY2d 535, 541 [1994]). Third-party defendant Pekofsky negotiated a lease on behalf of third-party plaintiffs RVP Consulting and Robert Peters (collectively, Peters), as tenants, in 1997. He then assigned the lease, rather than designating a lessee, thereby causing Peters, pursuant to the terms of the lease, to remain liable for the full performance of all the tenant's obligations thereunder. In 1998, the assignee defaulted in its rent obligations, triggering Peters's liability for the outstanding rent. This action was not commenced until 2002.

Contrary to Peters's contention, an adjudication of the meaning of Pekofsky's 1997 letter was not a prerequisite to the existence of an actionable injury. Indeed, while Peters may not have been aware until 2001 or 2002 that Pekofsky's actions could result in liability, it is not the date on which Peters learned that malpractice had occurred, but the date on which the malpractice was committed, that is relevant (West Vil. Assoc. Ltd. Partnership v Balber Pickard Battistoni [*2]Maldonado & Ver Dan Tuin, PC, 49 AD3d 270, 270 [2008]). Peters's subjective belief that Pekofsky had designated a lessee rather than assigning the lease is of no consequence. "

Full post as published by New York Attorney Malpractice Blog on March 01, 2010 (boomark / email).