Suit Under Attorney Deceit Statute Is Reinstated Based On Claims Of Conflicts & Unnecessary Litigation
On April 13, 2022, the Appellate Division, Second Department overruled a Supreme Court Justice who dismissed a claim of wrongdoing under Judiciary Law Section 487, against an attorney by clients he represented in a litigation concerning the sale of plaintiff's interests in three skilled nursing care facilities. It was claimed that the attorney "interfered with the settlement" of the litigation "causing years of additional litigation, in order to generate legal fees in the amount of $1.7 million". It was also claimed that the attorney made false statements to his clients and "filed a motion without plaintiff's knowledge or consent. The appellate court held that these allegations were sufficient to proceed to trial and also found: "The Supreme Court's determination that Howard Fensterman's conduct during the settlement of the... litigation "was simply a product of his conflict of interest in representing both buyers and sellers in the ...transactions" is a premature factual finding inappropriate at this stage of the litigation." Joseph v Fensterman, 2022 WL 1097226
An attorney is liable under Judiciary Law Section 487 if he or she "is guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive the court or any party”…or, “willfully delays his or her client's suit with a view to his or her own gain." This statute is punitive in nature and allows for an enhanced recovery to the plaintiff in legal malpractice actions. If you can plead and prove actual deceit that caused your economic losses, you are entitled to treble damages.