Legal Malpractice

Who Owes the Duty in Legal Malpractice?

By (Andrew Lavoott Bluestone)

An auto accident.  Severe injuries.  A multi-million dollar settlement.  Is that the end of the story?   TOKYO MARINE AND NICHIDO FIRE INSURANCE CO., LTD., as subrogee for Mitsubishi Motors Credit of America, Inc., Plaintiff, -against- ROSALIE CALABRESE and LOUIS FACCIPONTI, Defendants. ROSALIE CALABRESE and LOUIS FACCIPONTI, Third-Party Plaintiffs, -against- RUSSO & APOZNANSKI, and MONTFORT, HEALY, MCGUIRE & SALLEY, LLP, Third-Party Defendants. RUSSO & APOZNANSKI, Cross-Claimant, -against- MONTFORT, HEALY, MCGUIRE & SALLEY, LLP, Cross-Claim Defendant, MONTFORT, HEALY, MCGUIRE & SALLEY, LLP, Cross-Claimant, -against- RUSSO & APOZNANSKI, Cross-Claim Defendant,

07-CV-2514 (JS) (AKT);  UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NEW YORK; 2010 U.S. Dist. LEXIS 95079

Here, we see how the ever-shifting cast of attorneys and insurers have cast the trial of plaintiff's injury claim as simply a first act.  After the plaintiff leaves the stage, the regular players start their own action to determine who pays the money.

How does the court decide who will pay the settlement in the end?  By applying the known and well settled rules of legal malpractice.  "In objecting to Magistrate Judge Tomlinson's Order, the Third Party Defendants contend that London Fischer can face contribution liability even though it owed no duty to Ms. Calabrese, Mr. Facciponti, or the Third Party Defendants. In this regard, the Third Party Defendants rely principally on Shauer v. Joyce, 54 N.Y.2d 1 (N.Y. 1981) and Nassau Roofing & Sheet Metal Co. v. Facilities Development Corp., 71 N.Y.2d 599 (N.Y. 1988). But this reliance is misplaced.

In Shauer, the New York Court of Appeals held that an attorney sued for legal malpractice could bring a contribution claim against another attorney who represented the same client in the same [*5] matter, under a theory that it was the second attorney's negligence that at least partially caused the client's injuries. Shauer, 54 N.Y.2d at 5. Here, however, London Fischer never represented the Third Party Defendants' clients, but rather a co-defendant and that defendant's insurer. So, unlike in Shauer, the Third Party Defendants and London Fischer did not owe a duty to the same client, and London Fischer's alleged negligence in representing its clients cannot reduce the Third Party Defendants' potential liability to Ms. Calabrese and Mr. Facciponti.

Nassau Roofing Company is equally inapposite. There, the New York Court of Appeals held that, "[w]hile the culpable party from whom contribution is sought will ordinarily have breached a duty owed directly to the injured party, this is not invariably so," and noted that "[i]n the unusual case the right to apportionment may arise from the duty owed from the contributing party to the party seeking contribution." 71 N.Y.2d at 603 (internal citations and quotations omitted). Here, however, London Fischer did not owe a duty to either the allegedly injured parties (Ms. Calabrese and Mr. Facciponti) or the parties seeking contribution (the [*6] Third Party Defendants). Indeed, if anything, London Fischer's obligations were potentially adverse to Ms. Calabrese, Mr. Facciponti, and the Third Party Defendants, because it represented a co-defendant who may have had divergent and conflicting interests. See generally DeAngelis v. American Airlines, Inc., 06-CV-1967, 2010 WL 1270005, at *3 (E.D.N.Y. Mar. 26, 2010) (noting that co-defendants can have "starkly divergent interests").

The Third Party Defendants also argue that, under Nassau County, "[t]he critical requirement for apportionment . . . is that the breach of duty by the contributing party must have had a part in causing or augmenting the injury for which contribution is sought." 71 N.Y.2d at 603. But, contrary to the Third Party Defendants' claims, this does not mean that the Third Party Defendants can seek relief predicated on London Fischer's allegedly negligent representation of co-defendants with potentially divergent or conflicting interests. For, under New York law, a party can seek damages stemming from legal practice only if it enjoys "actual privity" with the allegedly negligent attorney, or a relationship "so close as to approach privity." 76 N.Y. Jur. [*7] 2d Malpractice § 39. And here, the Third Party Defendants lacked privity, or anything "approach[ing]" privity with London Fischer."
 

Full post as published by New York Attorney Malpractice Blog on September 15, 2010 (boomark / email).