Court dealt with Judiciary Law Section 487.

In Guliyev v Banilov & Assoc., P.C., 198 NYS3d 400, 402-03 [2d Dept 2023], the court dealt with Judiciary Law Section 487. The court held:

“On a motion to dismiss pursuant to CPLR 3211(a)(7), the complaint must be afforded a liberal construction, the facts therein must be accepted as true, and the plaintiff must be accorded the benefit of every possible favorable inference” (Angeli v. Barket, 211 A.D.3d 896, 897, 180 N.Y.S.3d 564; see Leon v. Martinez, 84 N.Y.2d 83, 87, 614 N.Y.S.2d 972, 638 N.E.2d 511). “Where evidentiary material is submitted and considered on a motion to dismiss a complaint pursuant to CPLR 3211(a)(7), and the motion is not converted into one for summary judgment, the question becomes whether the plaintiff has a cause of action, not whether the plaintiff has stated one, and unless it has been shown that a material fact as claimed by the plaintiff to be one is not a fact at all and unless it can be said that no significant dispute exists regarding it, dismissal should not eventuate” (Rabos v. R & R Bagels & Bakery, Inc., 100 A.D.3d 849, 851–852, 955 N.Y.S.2d 109; see Nassau Operating Co., LLC v. DeSimone, 206 A.D.3d 920, 925–926, 171 N.Y.S.3d 528).

“In an action to recover damages for legal malpractice, a plaintiff must demonstrate that the attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession and that the attorney’s breach of this duty proximately caused the plaintiff to sustain actual and ascertainable damages” (Bua v. Purcell & Ingrao, P.C., 99 A.D.3d 843, 845, 952 N.Y.S.2d 592; see Marinelli v. Sullivan Papain Block McGrath & Cannavo, P.C., 205 A.D.3d 714, 716, 169 N.Y.S.3d 90). “The plaintiff is required to plead actual, ascertainable damages that resulted from the attorneys’ negligence” (Bua v. Purcell & Ingrao, P.C., 99 A.D.3d at 847, 952 N.Y.S.2d 592; see Marinelli v. Sullivan Papain Block McGrath & Cannavo, P.C., 205 A.D.3d at 716, 169 N.Y.S.3d 90). “Conclusory allegations of damages or injuries predicated on speculation cannot suffice for a malpractice action, and dismissal is warranted where the allegations in the complaint are merely conclusory and speculative” (Bua v. Purcell & Ingrao, P.C., 99 A.D.3d at 848, 952 N.Y.S.2d 592 [citations omitted]; see Marinelli v. Sullivan Papain Block McGrath & Cannavo, P.C., 205 A.D.3d at 716, 169 N.Y.S.3d 90). Here, the complaint failed to plead specific factual allegations demonstrating that, but for the defendants’ alleged negligence,  there would have been a more favorable outcome in the underlying action or that the plaintiff would not have incurred any damages (see Williams v. Silverstone, 215 A.D.3d 787, 789, 185 N.Y.S.3d 699; Katsoris v. Bodnar & Milone, LLP, 186 A.D.3d 1504, 1506, 131 N.Y.S.3d 89). In addition, the plaintiff is precluded by the doctrine of collateral estoppel from relitigating the issue of whether the defendants had the authority to settle the underlying action (see CPLR 3211[a][5]; Reid v. Reid, 198 A.D.3d 993, 994, 157 N.Y.S.3d 52; Shifer v. Shifer, 165 A.D.3d 721, 723, 85 N.Y.S.3d 92).

Pursuant to Judiciary Law § 487, an attorney who is “guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive the court or any party” is liable to the injured party for treble damages (see Cordell Marble Falls, LLC v. Kelly, 191 A.D.3d 760, 762, 142 N.Y.S.3d 170). “A violation of Judiciary Law § 487 requires an intent to deceive” (Moormann v. Perini & Hoerger, 65 A.D.3d 1106, 1108, 886 N.Y.S.2d 49; see Cordell Marble Falls, LLC v. Kelly, 191 A.D.3d at 762, 142 N.Y.S.3d 170). “Allegations regarding an act of deceit or intent to deceive must be stated with particularity” (Bill Birds, Inc. v. Stein Law Firm, P.C., 164 A.D.3d 635, 637, 82 N.Y.S.3d 91, affd 35 N.Y.3d 173, 126 N.Y.S.3d 50, 149 N.E.3d 888; see CPLR 3016[b]; Palmieri v. Perry, Van Etten, Rozanski & Primavera, LLP, 200 A.D.3d 785, 787, 160 N.Y.S.3d 67). Here, the plaintiff’s allegations that the defendants hid true facts and acted to benefit themselves are conclusory and factually insufficient (see Palmieri v. Perry, Van Etten, Rozanski & Primavera, LLP, 200 A.D.3d at 787, 160 N.Y.S.3d 67; Cordell Marble Falls, LLC v. Kelly, 191 A.D.3d at 762, 142 N.Y.S.3d 170).


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Richard A. Klass, Esq., maintains a law firm engaged in civil litigation at 16 Court Street, 28th Floor, Brooklyn, New York. He may be reached at (718) COURT●ST or RichKlass@courtstreetlaw.comcreate new email with any questions.

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The statements in the complaint must be “sufficiently particular…”

In Buchanan v Law Offices of Sheldon E. Green, P.C., 215 AD3d 793, 795 [2d Dept 2023], the court held:

“To state a cause of action to recover damages for legal malpractice, a plaintiff must allege: (1) that the attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession; and (2) that the attorney’s breach of the duty proximately caused the plaintiff actual and ascertainable damages” (Dempster v. Liotti, 86 A.D.3d 169, 176, 924 N.Y.S.2d 484 [internal quotation marks omitted]; see Joseph v. Fensterman, 204 A.D.3d 766, 770, 167 N.Y.S.3d 106; Katsoris v. Bodnar & Milone, LLP, 186 A.D.3d 1504, 1506, 131 N.Y.S.3d 89; Lopez v. Lozner & Mastropietro, P.C., 166 A.D.3d 871, 873, 88 N.Y.S.3d 554). The statements in the complaint must be “sufficiently particular to give the court and parties notice of the transactions, occurrences, or series of transactions or occurrences, intended to be proved and the material elements of each cause of action or defense” (CPLR 3013; see Mid–Hudson Val. Fed. Credit Union v. Quartararo & Lois, PLLC, 31 N.Y.3d 1090, 1091, 78 N.Y.S.3d 703, 103 N.E.3d 774). “[B]are legal conclusions” do not suffice, and “[d]ismissal of the complaint is warranted if the plaintiff fails to assert facts in support of an element of the claim, or if the factual allegations and inferences to be drawn from them do not allow for an enforceable right of recovery” (Connaughton v. Chipotle Mexican Grill, Inc., 29 N.Y.3d 137, 141–142, 53 N.Y.S.3d 598, 75 N.E.3d 1159 [internal quotation marks omitted]).


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Richard A. Klass, Esq., maintains a law firm engaged in civil litigation at 16 Court Street, 28th Floor, Brooklyn, New York. He may be reached at (718) COURT●ST or RichKlass@courtstreetlaw.comcreate new email with any questions.

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The court dealt with the claim of attorney’s deceit.

In Philip S. Schwartzman, Inc. v Pliskin, Rubano, Baum & Vitulli, 215 AD3d 699, 702 [2d Dept 2023], the court dealt with the claim of attorney’s deceit, holding, opining:

“Under Judiciary Law § 487(1), an attorney who ‘[i]s guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive the court or any party’ is liable to the injured party for treble damages” (Altman v. DiPreta, 204 A.D.3d 965, 968, 168 N.Y.S.3d 86). “Since Judiciary Law § 487 authorizes an award of damages only to ‘the party injured,’ an injury to the plaintiff resulting from the alleged deceitful conduct of the defendant attorney is an essential element of a cause of action based on a violation of that statute” (Gumarova v. Law Offs. of Paul A. Boronow, P.C., 129 A.D.3d 911, 911, 12 N.Y.S.3d 187 [internal quotation marks omitted]).


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Richard A. Klass, Esq., maintains a law firm engaged in civil litigation at 16 Court Street, 28th Floor, Brooklyn, New York. He may be reached at (718) COURT●ST or RichKlass@courtstreetlaw.comcreate new email with any questions.

Prior results do not guarantee a similar outcome.

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Caveat Emptor: “All Houses Wherein Men Have Lived and Died Are Haunted Houses.”

person in exercise clothing looking through magnifying glass at damage in home. Illustrating article by Richard A. Klass about Caveat Emptor

The buyer of a Brooklyn building sued the seller for fraud and breach of contract after the closing of title. The buyer made several claims against the seller, including that the roof was leaking, it wasn’t new, and the construction and renovations performed on the building were shoddy and done only to quickly “flip” the property. The buyer also claimed that the tenant’s signed estoppel certificate was false. The buyer’s attorney claimed that no ordinary amount of due diligence would have revealed that the roof was leaking; only destructive testing done prior to closing would have shown water intrusion or mold. The seller’s position was that any alleged defects in connection with the sale of the building could have been raised before the closing of title. Once the closing took place, any alleged defects were waived; the representations in the contract of sale merged with the transfer of title.

Disclaimers in the Contract of Sale

In the contract of sale between the seller and buyer, there were numerous clauses that contained specific disclaimers.[1] Among these disclaimers was the following one (which is fairly typical in real estate contracts):

The Purchaser acknowledges that they have physically inspected the Premises prior to signing this Contract and are aware of the physical condition of the Premises and agree to take the Premises in “AS IS CONDITION” in its present physical condition. Purchaser acknowledges that the Seller has made no representation or warranties and concerning the physical condition of the Premises other than those that are specifically set forth herein.

Doctrine of Caveat Emptor – Buyer Beware!

The seller retained Richard A. Klass, Esq., Your Court Street Lawyer, to defend the lawsuit brought by the buyer. A motion to dismiss the case was filed based on several legal arguments, first and foremost being the defense of caveat emptor (meaning that the buyer was responsible for checking the quality of his purchase).

New York adheres to the caveat emptor doctrine and imposes no duty on the seller to disclose any information concerning the premises when the parties deal at arm’s length, unless there is some conduct on the part of the seller which constitutes active concealment. Platzman v. Morris, 283 AD2d 561 [2 Dept. 2001]. As held by the Second Department in London v. Courduff, 141 AD2d 803 [2d Dept. 1988], “The buyer has the duty to satisfy himself as to the quality of his bargain pursuant to the doctrine of caveat emptor, which in New York State still applies to real estate transactions.”

As held in Simone v Homecheck Real Estate Services, Inc., 42 AD3d 518, 521 [2d Dept 2007], “Where the contract specifically disclaims the existence of warranties or representations, a cause of action alleging breach of contract based on such a warranty or representation cannot be maintained (see Bedowitz v Farrell Dev. Co., 289 AD2d 432 [2001]). Here, the contract of sale specifically provided that the premises had been inspected by the buyer and was being sold ‘as is’ without warranty as to condition, express or implied. Furthermore, a specific merger clause is contained in the rider to the contract and precludes the buyer from claiming that he relied on any of the sellers’ alleged misrepresentations (see London v Courduff, supra). In addition, because title to the property had closed and the deed was delivered, the doctrine of merger extinguished any claim the buyer may have had regarding the contract of sale (see Ka Foon Lo v Curis, 29 AD3d 525 [2006]). Hence, the cause of action to recover for breach of contract cannot be maintained and should have been dismissed pursuant to CPLR 3211 (a) (7).”

Where the contract of sale, as in this case, contains a provision that the plaintiff is fully aware of the condition of the premises based upon his own inspection and is not relying upon any representations of the seller, any subsequent action for fraud is barred. Daly v. Kochanowicz, 67 AD3d 78 [2 Dept. 2009]; Platzman v. Morris, 283 AD2d 561, 563 [2 Dept. 2001] (“Since the contract contained a provision that the plaintiffs were fully aware of the condition of the premises based upon their own inspection and investigation, and not based upon any information or representations, written or oral, made by the sellers, the plaintiffs cannot claim fraud.”).

No ‘latent defect’ exception to the merger doctrine

The buyer argued in opposition to the motion that the merger doctrine did not apply to latent defects (which may only be discovered after occupancy of the premises). He incorrectly cited Fehling v Wicks, 179 Misc 2d 1041 [App Term 1999] as being a decision from the Second Department. It is actually a decision of the Appellate Term, Second Department. More importantly, the Fehling v Wicks decision has been rejected by the Appellate Divisions.

In Arnold v Wilkins, 61 AD3d 1236, 1237 [3d Dept 2009], the court held: “Plaintiffs alternatively contend that the merger doctrine does not apply here because the faulty sewage system was a ‘latent defect.’ In support, they rely on Fehling v. Wicks, 179 Misc.2d 1041, 687 N.Y.S.2d 868 [1999] for the proposition that ‘where the purchaser discovers latent defects which are discoverable only after the purchaser occupies the premises,’ the merger doctrine is inapplicable (id. at 1042, 687 N.Y.S.2d 868). Importantly, however, the purported ‘latent defect’ exception to the merger doctrine has not been adopted by the Appellate Divisions or the Court of Appeals in these circumstances.”

In TIAA Glob. Investments, LLC v One Astoria Sq. LLC, 127 AD3d 75, 85 [1st Dept 2015], the court held (emphasis added):

The merger doctrine in a real estate transaction provides that once the deed is delivered, its terms are all that survive and the purchaser is barred from prosecuting any claims arising out of the contract (Ka Foon Lo v. Curis, 29 A.D.3d 525, 526, 815 N.Y.S.2d 131 [2d Dept.2006] ). The only exception to this rule is where the parties clearly intended that the particular provision of the contract supporting the claim would survive the delivery of the deed (id.). Further, an “as is” clause in a contract to sell real property will ordinarily bar a claim for breach of contract (see Board of Mgrs. of the Chelsea 19 Condominium v. Chelsea 19 Assoc., 73 A.D.3d 581, 581, 905 N.Y.S.2d 8 [1st Dept.2010] ). Plaintiff argues that the merger doctrine does not apply here because of the latent nature of the defects at issue. It further contends that its allegations of deceptive behavior on Seller’s part to mask the true condition of the building render the “as is” clause inoperable.

Although plaintiff cites trial court opinions identifying a latency exception to the merger doctrine, the concept has not been adopted by any of the Appellate Divisions or by the Court of Appeals (see Arnold v. Wilkins, 61 A.D.3d 1236, 1237, 876 N.Y.S.2d 780 [3d Dept.2009]), and we are not adopting it here.

It was urged that the seller was bound to the decisions of the Appellate Divisions, as the Second Department has not opined on the issue yet. See, Summit Const. Services Group, Inc. v Act Abatement, LLC, 34 Misc 3d 823, 831 [Sup Ct 2011] (“The general rule is that trial courts must follow applicable decisions of the Appellate Division in their Department. If there is no decision from the Appellate Division in the Department in which the trial court is located, the trial court must follow the decision of another Department. This is because the Appellate Division is a single statewide court divided into departments for administrative convenience.”)

Seller did not engage in active concealment

The buyer’s attorney also argued that there was active concealment of defects by the seller. The complaint failed to make any allegation that the buyer was somehow thwarted by the seller from conducting any inspections or due diligence which could have discovered the purported defects. It was necessary for the buyer to allege material facts as essential allegations that the seller thwarted any efforts on his part to perform his due diligence. See, Jablonski v Rapalje, 14 AD3d 484, 485 [2d Dept 2005] (“To maintain a cause of action to recover damages for active concealment, the plaintiff must show, in effect, that the seller or the seller’s agents thwarted the plaintiff’s efforts to fulfill his responsibilities fixed by the doctrine of caveat emptor.”)

In Laxer v Edelman, 75 AD3d 584, 586 [2d Dept 2010], the Second Department held:

New York adheres to the doctrine of caveat emptor and imposes no liability on a seller [or the seller’s agent] for failing to disclose information regarding the premises when the parties deal at arm’s length, unless there is some conduct on the part of the seller[‘s agent] which constitutes active concealment” of a defective condition (Simone v Homecheck Real Estate Servs., Inc., 42 AD3d 518, 520 [2007]; see Daly v Kochanowicz, 67 AD3d 78, 87 [2009]; cf. Real Property Law §§ 462, 465). Moreover, even proof of active concealment will not suffice when the plaintiff should have known of the defect (see Richardson v United Funding, Inc., 16 AD3d 570, 571 [2005]). A plaintiff seeking to recover damages for active concealment must show that the defendant “thwarted” the plaintiff’s efforts to fulfill his or her responsibilities imposed by the doctrine of caveat emptor (Kerusa Co. LLC v W10Z/515 Real Estate Ltd. Partnership, 12 NY3d 236, 245 [2009] [internal quotation marks omitted]; see Rozen v 7 Calf Cr., LLC, 52 AD3d 590, 593 [2008]).

Based on the arguments presented, the judge granted the motion to dismiss. The judge held that the “defendants have established that the merger doctrine bars any claims arising out of the contract, requiring dismissal of the plaintiff’s cause of action for breach of contract. In a real estate transaction, the merger doctrine provides that, once title to the property closed and the deed was delivered, any claims that the plaintiff might have had arising from the contract of sale were extinguished.”


End Notes

[1] Section 11(c) stated: Except as otherwise expressly set forth in this contract, none of Seller’s covenants, representations, warranties or other obligations contained in this contract shall survive Closing.

Section 12 stated: Condition of Property. Purchaser acknowledges and represents that Purchaser is fully aware of the physical condition and state of repair of the Premises and of all property included in this sale, based on Purchaser’s own inspection and investigation and not upon any information, data, statements or representations, written or oral, as to the physical condition, state of repair, use, cost or operation or any other matter related to the Premises or the other property included in the sale, given or made by Seller or its representatives, and shall accept the same “as is” except as set forth herein in their present condition and state of repair; subject to reasonable use, wear, tear and natural deterioration between the date hereof and the date of Closing (except as otherwise set forth in paragraph 16(f), without any reduction in the purchase price or claim of any kind for any change in such condition by reason thereof subsequent to the date of this contract. Purchaser and its authorized representatives shall have the right, at reasonable times and upon reasonable notice (by telephone or otherwise) to Seller, to inspect the Premises before Closing.

Section 28 stated: Miscellaneous. (a) All prior understandings, agreements, representations and warranties, oral or written, between Seller and Purchaser are merged in this contract; it completely expresses their full agreement and has been entered into after full investigation, neither party relying upon any statement made by anyone else that is not set forth in this contract.

Rider at Section 12 stated: Tenancies. The purchaser herein agrees to take title to the Premises, SUBJECT TO the following tenancies: NONE. PURCHASER SHALL RECEIVE A CREDIT OF $5,000 FROM SELLER FOR THE LOWER RENT AMOUNTS & SECURITY DEPOSITS.

Rider at Section 15 stated: No representations by Seller. Seller makes no warranties or representations concerning the physical condition, work repairs, renovations, or improvements, if any, income, expenses for operation, taxes or fitness of the Premises except as specifically set forth herein. The Purchaser acknowledges that they have physically inspected the Premises prior to signing this Contract and are aware of the physical condition of the Premises and agree to take the Premises in “AS IS CONDITION” in its present physical condition. Purchaser acknowledges that the Seller has made no representation or warranties and concerning the physical condition of the Premises other than those that are specifically set forth herein. The Seller shall not be bound by or liable for any representations, oral or written, pertaining to the Premises, furnished or made by any real estate broker or salesperson, agent or employee, servant or other, unless same is specifically set forth herein. Notwithstanding, none of the representations, warranties, covenants or other obligations of SELLERS hereunder shall survive the CLOSING, except as expressly provided herein. Acceptance of the deed by PURCHASERS shall be deemed full and complete performance and discharge of every agreement and obligation of SELLERS hereunder, except those, if any, which expressly are stated herein to survive the CLOSING.

Rider at Section 22 stated: Delivery and Acceptance of the Deed. The delivery and acceptance of the deed at closing by the Purchaser shall constitute full compliance by the Seller of all of the terms and conditions of this Contract, and none of the terms and conditions of this Contract shall survive the delivery of the deed unless specifically stated otherwise.

Rider at Section 32 stated: Entire Understanding. This agreement constitutes the entire Contract between the parties. It may not be modified orally or in any other manner except by an agreement in writing signed by the parties hereto.

Rider at Section 38 stated: Property Condition Disclosure Credit. Seller will not provide to the Purchaser the Property Condition Disclosure Statement under Article 14 of the New York Real Property Law. The Purchaser agrees to the $500.00 monetary credit as set forth in section 465(a) of the Property Condition Disclosure Act. By the acceptance of a $500.00 credit, the purchaser waives any failure or misrepresentation whether of not knowing or willful on the part of the Seller. The purchase price reflected herein is net of the $500.00 given by Seller to Purchaser as a credit in lieu of Purchasers receiving a property condition disclosure statement from Sellers.

Richard A. Klass, Esq.
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#caveatemptor, #buyerbeware, #realestatelaw

Richard A. Klass, Esq., maintains a law firm engaged in civil litigation at 16 Court Street, 28th Floor, Brooklyn, New York. He may be reached at (718) COURT●ST or RichKlass@courtstreetlaw.comcreate new email with any questions.

Prior results do not guarantee a similar outcome.

© 2021 Richard A. Klass

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Scales of justice illustrating article about legal malpractice.

Intent to deceive and Judiciary Law Section 487

The court dismissed the claims against the attorney relating to intent to deceive, holding:

Under Judiciary Law Section 487, an attorney who “[i]s guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive the court or any party” is liable to the injured party for treble damages. “ [V]iolation of Judiciary Law Section 487 requires an intent to deceive, whereas a legal malpractice claim is based on negligent conduct ” (Moormann v. Perini & Hoerger, 65 A.D.3d 1106, 1108, 886 N.Y.S.2d 49 [citation omitted]; see Gorbatov v. Tsirelman, 155 A.D.3d 836, 838, 65 N.Y.S.3d 71).

Aristakesian v Ballon Stoll Bader & Nadler, P.C., 165 AD3d 1023, 1025 [2d Dept 2018].

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