Opinion
Index No. 105558/07
07-03-2013
DEVONSHIRE SURGICAL FACILITY, LLC, ET AL Plaintiffs, v. LAW OFFICES OF LEO TEKIEL AND LEO TEKIEL, ESQ., Defendants. LAW OFFICES OF LEO TEKIEL AND LEO TEKIEL, ESQ, Third-Party Plaintiffs, v. KENNETH I. KUTNER, ESQ. AND HOFFMAN EINIGER AND POLLAND, PLLC Third-Party Defendants.
DECISION/ORDER
HON. CYNTHIA S. KERN, J.S.C.
Recitation, as required by CPLR 2219(a), of the papers considered in the review of this motion for:
+------------------------------------------------+ ¦Papers ¦Numbered¦ +---------------------------------------+--------¦ ¦Notice of Motion and Affidavits Annexed¦1 ¦ +---------------------------------------+--------¦ ¦Answering Affidavits ¦2.3 ¦ +---------------------------------------+--------¦ ¦Replying Affidavits ¦4 ¦ +---------------------------------------+--------¦ ¦Exhibits ¦ ¦ +------------------------------------------------+
Third- party defendant Kenneth L. Kutner, Esq. ("Kutner") has brought the present motion for summary judgment dismissing the third-party complaint as against him. For the reasons stated below, the motion is granted and the third-party complaint is dismissed as against Kutner.
The relevant facts are as follows. Kutner is an attorney. He alleges that in 2004, he was advised by a friend of his, Mr. Einiger, that a client of Mr. Einiger, Dr. Allan Chamberlain, may have a cause of action against various insurance companies for improperly denying insurance payments for medical services rendered. Kutner agreed with Mr. Einiger to cooperatively investigate the claims regarding misconduct by the insurance companies with regard to denying payments to Dr. Chamberlin's medical practices Devonshire Surgical Facility, LLC ("Devonshire) and Carnegie Hall Orthopedic Services, P.C. ("Carnegie") and to assist in commencing a case in Supreme Court against several of the offending insurance companies. This action was commenced in September 2004. In connection with the Supreme Court action, Hoffman, Einiger and Polland , PLLC was directly retained by Dr. Chamberlin. Kutner was never directly retained by Dr. Chamberlin in the Supreme Court action but was retained by Mr. Einiger's firm to assist in the Supreme Court action.
Approximately one year before the Supreme Court action was commenced, the defendants and third-party plaintiffs, Law Offices Of Leo Tekiel and Leo Tekiel, Esq. (the "Tekiel Defendants"), filed an amended summons and complaint in an unrelated action commenced by Dr. Chamberlin's medical practices, Devonshire and Carnegie, in New York City Civil Court against Travelors Indemnity Co. (the "Travelors Action") in October 2003. The Travelors Action sought payment for medical services rendered by Dr. Chamberlin's medical practices to fourteen of Travelors' insureds under no fault insurance coverage. The Tekiel Defendants had assumed the representation in the Travelors Action from prior counsel in the matter, Paul Solda, Esq. After the plaintiffs in the Travelors Action failed to respond to discovery requests which Travelors had served on them, Travelors filed a motion to dismiss the Travelors Action pursuant to CPLR 3126 for the continued failure to provide the requested discovery in March 2004. After Travelors filed the motion to dismiss, Kutner sent a letter to Mr. Tekiel dated March 25, 2004 in which he requested, inter alia, that Mr. Tekiel furnish him with all captions and index numbers of actions already commenced so that Kutner could prepare substitution of attorney forms. In response to this letter, Tekiel sent Kutner correspondence dated March 26,2004 which included a list of nineteen commenced actions with regard to the Tekiel Defendants' representation of Chamberlin's medical practices. The list included the Travelors Action and noted that a motion to dismiss was returnable on April 5, 2004 and that discovery had not been provided. On or about May 10, 2004, Kutner again sent a letter to Tekiel requesting that Tekiel adjourn Travelors' motion to dismiss so as to permit Kutner and his co-counsel to "finalize the anticipated substitution of attorneys in the case" being handled for Dr. Chamberlin. On May 11, 2004, on the return date of the motion to dismiss, the Tekiel Defendants, through per diem counsel, stipulated in the Travelors action to a self executing conditional order of preclusion if the requested discovery was not provided within sixty days. The stipulation also provided that Tekiel was to serve a copy of the stipulation to Kutner, successor counsel and Kutner was directed to serve a substitution of counsel within thirty days of receipt of the order. On July 9, 2004, Kutner sent another letter to Tekiel requesting that Tekiel forward all outstanding discovery demands and demands for bills of particular, etc. to Kutner. On July 12, 2004, the Tekiel Defendants delivered the files from the Travelors Action and other files to Kutner via messenger service. Kutner immediately delivered these boxes to the offices of Dr. Chamberlin. On or about August 4, 2004, Travelors filed a motion for summary judgment to dismiss the Travelors Action based upon the self executing order of preclusion. Tekiel submitted an affirmation in opposition to the motion in which he took the position that he was no longer the attorney of record in the case and that Kutner was handling the case. Based on these facts, he requested an adjournment of the motion for summary judgment. After not hearing any further from Kutner with respect to the substitution of counsel or the transfer of files, he made a motion to be relieved as counsel on or about September 25, 2004, which was granted on October 1, 2004. The court also granted a thirty day stay of the action. After the plaintiffs failed to retain new counsel, the court granted the motion for summary judgment dismissing the action made by Travelors without opposition. It is undisputed that Kutner never actually prepared a substitution of attorney form in the Travelors action and never formally appeared in the Travelors Action.
After the Travelors Action was dismissed, plaintiffs brought the present action against the Tekiel Defendants for legal malpractice based on the dismissal of the Travelors Action. The Tekiel Defendants then brought the present third-party action against Kutner asserting claims for contribution and indemnification. Both of these claims are based on the theory that Kutner committed legal malpractice in his representation of plaintiffs in the Travelors Action. Both of the third party defendants previously made motions to dismiss the action before answering the third party complaint. Justice Solomon granted the motion by Hoffman, Einiger and Polland, PLLC to dismiss the action against it on the ground that it did not have an attorney client relationship with the plaintiffs. However, she denied the motion to dismiss made by Kutner without prejudice to renewal after further proceedings due to a lack of information about exactly what occurred between the Tekiel Defendants and Kutner.
Initially, this court finds that Kutner is entitled to summary judgment dismissing the third party action on the ground that he did not violate any duty to plaintiffs with regard to the Travelers Action as he never represented plaintiffs in the underlying Travelors Action. Based on the undisputed facts before this court, Kutner never represented Devonshire, Carnegie or Dr. Chamberlin in the Travelors Action. It is undisputed that the first attorney in the underlying Travelors Action was Paul Solda and that the Tekiel Defendants were then substituted for Mr. Solda. It is also undisputed that the Tekiel Defendants continued to represent plaintiffs in the Travelors Action until they were relieved as counsel by order of the court on October 1, 2004. It is also undisputed that there was never a substitution of counsel in the Travelors Action whereby Kutner was substituted in place of the Tekiel Defendants. To the contrary, at the time the Travelors Action was dismissed in Civil Court, no counsel had been substituted in place of the Tekiel Defendants and the plaintiffs were unrepresented at that time. There cannot be any valid claim against Kutner for legal malpractice in the Travelors Action as he never represented the plaintiffs in that action.
The argument by plaintiffs and the Tekiel defendants that summary judgment should be denied because there are issues of fact regarding whether Kutner was ever retained by plaintiffs in the Travelors Action and what his involvement in the Travelors action consisted of is without merit. To the extent that there is some evidence in the record that Kutner was planning to represent the plaintiffs in the Travelors Action, that he indicated that he was planning to prepare substitution of counsel forms in the Travelors Action and that he requested that certain discovery requests in the Travelors Action be sent to him, that is insufficient to establish that he did in fact assume a duty to the plaintiffs in the Travelors Action to represent them as counsel. CPLR section 321 (b), which governs a change or withdrawl of attorney, provides that "an attorney of record may be changed by filing with the clerk a consent to the change signed by the retiring attorney and signed and acknowledged by the party." It further provides that an "attorney of record may withdraw or be changed by order of the court in which the action is pending, upon motion...." Based on CPLR 321, the law is clear that "[u]ntil an attorney of record is discharged by order of the court or by the filing of the consent of the retiring attorney and party in the prescribed form (see, CPLR 321 [b]), the attorney represents the party." Hawkins v. Lenox Hill Hosp., 138 A.D.2d 572, 573 (2nd Dept 1988). See also Vitale v. City Constr. Mgt. Co., 172 A.D.2d 326 (1st Dept 1991) ("Absent a consent signed by prior counsel, or an order of the court, prior counsel remained plaintiff's counsel of record"). In the present case, it is undisputed that there was never any filing with the court of a consent to change attorney signed by the Tekiel Defendants and signed and acknowledged by the plaintiffs in the Travelors Action. As a result, the Tekiel Defendants continued to represent the plaintiffs in the Travelors Action up through and until they obtained an order of the court discharging them. Nor is there any evidence that Kutner agreed to represent the plaintiffs in the Travelors Action after the Tekiel Defendants obtained an order from the court discharging them as counsel or any evidence that he ever appeared in the Travelors Action. Therefore, as a matter of law, Kutner was not plaintiffs' attorney in the Travelors Action and did not undertake a duty to represent them in that action. As a result, he cannot be held responsible to the plaintiffs in the Travelors Action for any of the events which occurred in the Travelors Action, including an order of preclusion being entered against the plaintiffs and the action being dismissed based on the plaintiffs' failure to provide discovery.
Based on this court's finding that Kutner never owed any duty to represent plaintiffs in the Travelors Action, there can be no valid third party claim for contribution. In order to determine whether a third party action for contribution exists, "the critical issue is whether the third- party defendant owed a duty to the plaintiff which was breached and which contributed to or aggravated plaintiff's damages." Rosner v. Paley, 65 N.Y.2d 736, 738 (1985). Since this court has already determined that Kutner did not owe any duty plaintiffs in the Travelors Action since he never represented them in that action, he cannot be found to have contributed to plaintiffs' injuries in that action and cannot be found liable for contribution.
The cause of action for contribution is also insufficient as a matter of law because the damages sought in the underlying action are purely monetary. Under New York's contribution statute, "two or more persons who are subject to liability for damages for the same personal injury, injury to property or wrongful death, may claim contribution among them whether or not an action has been brought or a judgment has been rendered against the person from whom contribution is sought." CPLR § 1401. Board of Educ. of Hudson City School Dist. v. Sargent, Webster, Crenshaw & Folley, 71 N.Y.2d 21, 26 (1987). The law is clear that where "the underlying claim seeks purely economic damages, a claim for common-law contribution is not available." Children's Corner Learning Center v. A Miranda Contracting Corp., 64 A.D.3d 318, 323 (1st Dept 2009). "[T]he determining factor as to the availability of contribution is not the theory behind the underlying claim but the measure of damages sought." Rockefeller University v. Tishman Construction Corp., 240 A.D.2d 341 (1st Dept 1997). If the damages sought are to be placed in as good a position as one would have been but for the acts being sued upon, then the claim is for economic damages. Children's Learning Center, 64 A.D.3d at 324.
In the present case, the plaintiffs in the underlying action are clearly seeking to recover economic damages as they are seeking to be placed in the same position they would have been if there had not been any alleged legal malpractice and they had a full recovery on their claim to recover the costs of medical services they allegedly provided. Therefore, there is no valid claim for contribution as against Kutner in the third-party action.
Finally, there is no valid claim for indemnification under the circumstances of this case. A claim for "indemnity involves an attempt to shift the entire loss from one who is compelled to pay for a loss, without regard to his own fault, to another party who should more properly bear responsibility for the loss because it was the actual wrongdoer." Trustees of Columbia University v. Mitchell/Giurgola Associates, 109 A.D.2d 449 (1st Dept 1985). The right to indemnification can be created by an express contract or may be implied by law. Id. Implied indemnity allows one who "is held vicariously liable solely on account of the negligence of another to shift the entire burden of the loss to the actual wrongdoer." Id. The one seeking indemnity must prove not only that it was not guilty of any negligence beyond statutory liability, but must also prove that the indemnitor was guilty of some negligence that contributed to the causation of the accident. Corieia v. Professional Data Management, Inc., 259 A.D.2d 60 (1st Dept 1999). As the First Department has stated, "[s]ince the predicate of common-law indemnity is vicarious liability without actual fault on the part of the proposed indemnitee, it follows that a party who has itself actually participated to some degree in the wrongdoing cannot receive the benefit of the doctrine." SSDW Company, 151 A.D.2d at 296 (quoting Trustees of Columbia Univ., 109 A.D.2d at 453).
In the instant case, the Tekiel Defendants cannot maintain indemnity claims against Kutner as there is no valid claim asserted against them based on vicarious liability. The plaintiffs allege that the Tekiel Defendants engaged in legal malpractice. As such, the Tekiel Defendants are being charged with liability for their own alleged wrongdoing and not merely vicariously for any actions taken by Kutner.
Finally, there is no merit to plaintiffs' argument that this motion is barred by law of the case based on the previous decision by Justice Solomon denying Kutner's motion to dismiss. The previous motion by Kutner was made before he answered in the action and the court specifically stated that the motion was denied without prejudice to renewal after discovery had taken place.
Based on the foregoing, Kutner's motion for summary judgment dismissing the third-party complaint as against him is granted and the clerk is directed to enter judgment accordingly. This constitutes the decision and order of this court.
Enter: ______________________
J.S.C.