To Be Argued By:
Dr. Ralph Speken
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SUPREME COURT OF THE STATE OF NEW YORK
APPELLATE DIVISION: FIRST DEPARTMENT
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RALPH H. SPEKEN, M.D. and
STEPHANIE Z. SPEKEN, M.S.,
Plaintiffs-Appellants,
– against –
THOMAS R. MOORE, ESQ.,
Defendant-Respondent.
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BRIEF OF PLAINTIFFS-APPELLANTS
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RALPH H. SPEKEN, M.D.
STEPHANIE Z. SPEKEN, M.S.
Plaintiffs-Appellants Pro Se
81 Pondfield Road, No. 179
Bronxville, New York 10708
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New York County Clerk’s Index No.114722/02
TABLE OF CONTENTS
TABLE OF AUTHORITIES………………………………………………………………………………………….3
PRELIMINARY STATEMENT……………………………………………………………………………………..7
STATEMENT OF FACTS……………………………………………………………………………………………..7
Background………………………………………………………………………………………………………………..7
Plaintiffs’ Motion to Vacate the Settlement……………………………………………………………………11
Justice Heitler’s March 31, 2000 Order………………………………………………………………………..13
Plaintiffs’ Second Action Against Columbia Presbyterian……………………………………………….14
The Legal Malpractice Complaint…………………………………………………………………………………15
The April 15, 2003 Order Appealed From……………………………………………………………………..16
POINT I
PLAINTIFFS’ LEGAL MALPRACTICE
COMPLAINT IS SUFFICIENTLY PLED
AND SHOULD NOT HAVE BEEN DISMISSED……………………………………………………17
POINT II
PLAINTIFFS’ LEGAL MALPRACTICE
COMPLAINT IS NOT BARRED BY THE
DOCTRINE OF RES JUDICATA…………………………………………………………………………21
POINT III
PLAINTIFFS’ LEGAL MALPRACTICE
COMPLAINT STATES A VALID CLAIM
FOR PUNITIVE DAMAGES……………………………………………………………………………….32
CONCLUSION…………………………………………………………………………………………………………..37
TABLE OF AUTHORITIES
Case Page
Bennardo v. Equitable Land Service, Inc.,
244 A.D.2d 304, 663 N.Y.S.2d 892, 893 (2d Dep’t 1997)………………………………………………………………..29
Campaign for Fiscal Equity, Inc. v. State, 86 N.Y.2d 307, 631 N.Y.S.2d 565 (1995)……………………………17,19
D’Antoni v. Ansell, 84 A.D.2d 678, 585 N.Y.S.2d 459 (2d Dep’t 1992)………………………………………………34
Detmer v. Acampora, 207 A.D.2d 475, 616 N.Y.S.2d 506 (2d Dep’t 1994)…………………………………………18
Ferrandino v. Alvin J. Bart & Sons, Inc., 247 A.D.2d 428, 668 N.Y.S.2d 99 (2d Dep’t 1998)………………..18
Gabriel v. Therapists Unlimited, L.P., 218 A.D.2d 614, 631 N.Y.S.2d 34 (1st Dep’t 1995)……………………..17
Genton v. Arpeggio Restaurant, Inc., 232 A.D.2d 274, 648 N.Y.S.2d 552 (1st Dep’t 1996)………………….29
Giblin v. Murphy, 73 N.Y.2d 69, 536 N.Y.S.2d 54 (1988)………………………………………………………………….34
Gilberg v. Barbieri, 53 N.Y.2d 285, 441 N.Y.S.2d 49 (1985)……………………………………………………………….30
Guggenheimer v. Ginzburg, 43 N.Y.2d 268, 401 N.Y.S.2d 182 (1977)……………………………………………….17,19
Heimuller v. Amoco Oil Co., 92 A.D.2d 882, 459 N.Y.S.2d 867 (2d Dep’t 1983)…………………………………..21
Home Ins. Co. v. Liebman, Adolf & Charme, 257 A.D.2d 424, 683 N.Y.S.2d 519………………………………….27
Leon v. Martinez, 84 N.Y.2d 83, 614 N.Y.S.2d 972 (1994)………………………………………………………………17,19
Matter of Simenowitz, 223 A.D.2d 252, 644 N.Y.S.2d 1001(2d Dep’t 1996)………………………………………..34
M.M. v. E.M., 248 A.D.2d 109, 669 N.Y.S.2d 543 (1st Dep’t 1998)…………………………………………………….17
Morone v. Morone, 50 N.Y.2d 481, 429 N.Y.S.2d 592 (1989)…………………………………………………………….17
Nash v. Y and T Distributors, 207 A.D.2d. 779, 616 N.Y.S.2d 402 (2d Dep’t 1994)………………………………21
Palmisano v. Modernismo Publications, Ltd., 98 A.D.2d 953,
470 N.Y.S.2d 196 (4th Dep’t 1983)……………………………………………………………………………………………….17,19
Paulsen v. Paulsen, 148 A.D.2d 685, 539 N.Y.S.2d 433 (2d Dep’t 1989)……………………………………………17,19
Rocanova v. Equitable Life Assur. Socy., 83 N.Y.2d 603, 612 N.Y.S.2d 339 (1994)……………………………….32
Sanders v. Winship, 57 N.Y.2d 391, 456 N.Y.S.720 (1982)………………………………………………………………….18
Stukuls v. State of New York, 42 N.Y.2d 272, 397 N.Y.S.2d 740………………………………………………………… 18
Teichner v. Holsteins, Inc., 64 N.Y.2d 977, 489 N.Y.S.2d 36 (1985)…………………………………………………….28
Treatises: Page
24 N.Y. Jur., Fraud and Deceit, § 14…………………………………………………………………………………………………25
37 C.J.S. Fraud § 3…………………………………………………………………………………………………………………………..25
Siegel, New York Practice, 3d ed., § 465 at 747…………………………………………………………………………………..21
Statutes:
CPLR 3013…………………………………………………………………………………………………………………………………….20
CPLR 3211……………………………………………………………………………………………………………………………………..17
Siegel, Practice Commentaries, CPLR 3211:24…………………………………………………………………………………18
SUPREME COURT OF THE STATE OF NEW YORK
APPELLATE DIVISION: FIRST DEPARTMENT
RALPH H. SPEKEN, M.D. and STEPHANIE
Z. SPEKEN, M.S., :
New York County Clerk’s
Plaintiffs-Appellants, : Index No. 114722/02
– against – :
THOMAS R. MOORE, ESQ., :
Defendant-Respondent. :
BRIEF OF PLAINTIFFS-APPELLANTS
PRELIMINARY STATEMENT
Plaintiffs-appellants Ralph H. Speken, M.D. and Stephanie Z. Speken, M.S. respectfully submit this Brief in support of their appeal from the Order of Supreme Court, New York County (Tolub, J.), entered on April 23, 2003, which granted defendant’s pre-answer motion to dismiss the complaint.
In this action, plaintiffs seek to recover damages for, inter alia, defendant’s legal malpractice arising from his representation of plaintiffs in a medical malpractice action involving the death of their son entitled Ralph H. Speken and Stephanie Z. Speken, as Co-Administrators of the Estate of Seth B. Speken, Deceased, and Ralph H. Speken and Stephanie Z. Speken, Individually v. Columbia Presbyterian Medical Center, et al (The “Medical Malpractice Action”).
Rocanova v. Equitable Life Assur. Socy., 83 N.Y.2d 603, 612 N.Y.S.2d 339 (1994)……………………………….32
Sanders v. Winship, 57 N.Y.2d 391, 456 N.Y.S.720 (1982)…………………………………………………………………..18
Stukuls v. State of New York, 42 N.Y.2d 272, 397 N.Y.S.2d 740………………………………………………………… 18
Teichner v. Holsteins, Inc., 64 N.Y.2d 977, 489 N.Y.S.2d 36 (1985)……………………………………………………..28
Treatises: Page
24 N.Y. Jur., Fraud and Deceit, § 14………………………………………………………………………………………………….25
37 C.J.S. Fraud § 3…………………………………………………………………………………………………………………………..25
Siegel, New York Practice, 3d ed., § 465 at 747…………………………………………………………………………………21
Statutes:
CPLR 3013……………………………………………………………………………………………………………………………………..20
CPLR 3211……………………………………………………………………………………………………………………………………..17
Siegel, Practice Commentaries, CPLR 3211:24…………………………………………………………………………………18
SUPREME COURT OF THE STATE OF NEW YORK
APPELLATE DIVISION: FIRST DEPARTMENT
RALPH H. SPEKEN, M.D. and STEPHANIE
Z. SPEKEN, M.S., :
New York County Clerk’s
Plaintiffs-Appellants, : Index No. 114722/02
– against – :
THOMAS R. MOORE, ESQ.,:
Defendant-Respondent. :
BRIEF OF PLAINTIFFS-APPELLANTS
PRELIMINARY STATEMENT
Plaintiffs-appellants Ralph H. Speken, M.D. and Stephanie Z. Speken, M.S. respectfully submit this Brief in support of their appeal from the Order of Supreme Court, New York County (Tolub, J.), entered on April 23, 2003, which granted defendant’s pre-answer motion to dismiss the complaint.
In this action, plaintiffs seek to recover damages for, inter alia, defendant’s legal malpractice arising from his representation of plaintiffs in a medical malpractice action involving the death of their son entitled Ralph H. Speken and Stephanie Z. Speken, as Co-Administrators of the Estate of Seth B. Speken, Deceased, and Ralph H. Speken and Stephanie Z. Speken, Individually v. Columbia Presbyterian Medical Center, et al (The “Medical Malpractice Action”).
In dismissing the legal malpractice complaint upon the ground of res judicata, Supreme Court relied on a prior decision rendered by Justice Klein-Heitler in the Medical Malpractice Action which upheld the validity of the settlement and general releases entered into between plaintiffs and the hospital in that action. However, as demonstrated more fully below, the Court’s reliance on the prior order to support its dismissal of the instant action under the doctrine of res judicata, was improper.
The penultimate finding in Justice Klein-Heitler’s order in the Medial Malpractice action was that there was no evidence of fraud on the part of Columbia Presbyterian in negotiating and entering into the settlement. Therefore, Justice Klein-Heitler’s findings on the issue of defendant’s conduct vis-à-vis plaintiffs were “gratuitous” and do not bar plaintiffs’ legal malpractice litigation. Indeed, in the decision, Justice Klein-Heitler specifically and expressly left open the issue of plaintiff’s recourse against defendant for his negligent and fraudulent conduct in representing plaintiffs in the Medical Malpractice Action. In any event, Justice Klein-Heitler’s findings vis-à-vis defendant’s fraud, duress and coercion practiced upon plaintiffs, were incorrect, irrelevant, made in the absence of a hearing, and insufficient to support dismissal of the legal malpractice complaint.
Moreover, the Court’s alternative ground for dismissal that there is “no evidence” of negligence or breach of contract was improper on defendant’s pre-answer motion.
STATEMENT OF FACTS
Background
On or about June 22, 1994, plaintiffs consulted with and retained defendant to represent them in a medical malpractice action against Columbia Presbyterian Medical Center to recover damages for the hospital’s medical malpractice arising out of the death of plaintiffs’ son, Seth. Plaintiffs signed a standard written retainer agreement with defendant to prosecute the action in accordance with Judiciary Law § 474-a(2).
On or about October 11, 1994, defendant commenced the malpractice action on plaintiffs’ behalf in the Supreme Court, New York County, under Index No. 128682/94 (Ralph H. Speken and Stephanie Z. Speken, as Co-Administrators of the Estate of Seth B. Speken, Deceased, and Ralph H. Speken and Stephanie Z. Speken, Individually v. Columbia Presbyterian Medical Center, et al) (the “Medical Malpractice Action”).
In March 1996, Columbia Presbyterian obtained an order permitting it to bring a counterclaim against plaintiff Ralph Speken for indemnification and/or contribution based upon his alleged malpractice in the treatment Seth. Defendant engaged Clare Pare, Esq., to represent Ralph Speken on the counterclaim. Plaintiffs signed a retainer agreement with Ms. Pare providing for a contingent fee of 25% of the net proceeds received from the wrongful death action, after payment of defendant’s attorney’s fees for prosecution of the Medical Malpractice Action. Plaintiffs later learned that defendant misrepresented to them that he could not represent Ralph Speken on the counterclaim.
On or about June 14, 1999, defendant informed plaintiffs by telephone that he and Richard Frank, Esq., were going to pick a jury. Thereafter, defendant informed plaintiffs that the trial had been postponed to June 21, 1999.
On or about June 21, 1999, defendant informed plaintiffs that Mr. Frank had a “bad back” and that jury selection had to be postponed.
On or about June 24, 1999, defendant informed plaintiffs by telephone that Mr. Frank is “out of the case, and it’s a good thing” that he is.
Shortly thereafter, plaintiffs received a letter from Mr. Frank in which he stated that he was withdrawing and/or resigning from the Medical Malpractice Action .
On or about June 28, 1999, defendant informed plaintiffs that the Trial Court in the Medical Malpractice Action directed that they appear in court to swear under oath that they requested that Mr. Frank be relieved from the Medical Malpractice Action .
Plaintiffs informed defendant that they did not want to make such a representation to the Court because it was not true. However, defendant threatened plaintiffs that Mr. Frank would “ruin the case” if we did not “discharge” him.
Plaintiffs had no choice but to follow defendant’s direction. Thus, they appeared before the Trial Court and requested that Mr. Frank be discharged.
From the outset defendant had led plaintiffs to believe that he was a “super” lawyer and would “come in at the end and do the trial himself.” However, after the Trial Court approved the discharge of Mr. Frank, defendant informed them that he had already retained another lawyer to try the Medical Malpractice Action.
On or about June 29, 1999, at defendant’s direction, plaintiffs met with the law firm of Assail and Yoelli whom defendant said was going to try the underlying case. Assail and Yoelli decided not to take on the Medical Malpractice Action.
Thereafter, on or about July 8, 1999, defendant telephoned plaintiff Stephanie Speken and stated that he had settled the Medical Malpractice Action and that plaintiffs were required to sign general releases and appear before the Trial Court immediately.
Plaintiffs met with defendant later that same day at his office to discuss the settlement. During this meeting, defendant told plaintiffs that they had no choice but to accept the settlement and to sign general releases because, inter alia
(a) If plaintiffs did not sign releases, the Trial Judge would immediately “close down” the case;
(b) The Trial Judge was “corrupt” and therefore it was no use talking to the Judge and trying to do so would only “make matters worse” for plaintiffs;
(c) Columbia Presbyterian Medical Center intended to commence a “multi-million dollar” defamation suit against plaintiffs with respect to their website related to the events alleged in the Medical Malpractice Action;
(d) Defendant would not represent plaintiffs in the defense of the action;
(e) Defendant would have no choice but to resign from the Medical Malpractice Action if plaintiffs did not accept the settlement and sign general release
(f) For the first time, defendant stated that he did not have the skills and was not prepared to try the case, and that Laura Shapiro [Columbia Presbyterian’s attorney] would “crush me.”; and
(g) Defendant had negotiated the settlement in such a way that plaintiffs would be able to keep their website up and running with only “minor” changes (such as changing the names of the doctors).
Plaintiffs informed defendant that they did not accept the settlement and wished to proceed to trial. Plaintiffs were not prepared to give up their First Amendment rights to talk about the death of their beloved son at the hands of Columbian Presbyterian, and would not agree to “any” changes to the website in which they discussed their son’s death.
During the taxicab ride to the Courthouse on July 8, 1999, defendant repeated the above “reasons” and again forcefully threatened to withdraw from the case if plaintiffs did not accept the settlement .
Prior to meeting with the Trial Judge in chambers, defendant told plaintiffs that they would have to state to the Court that we consented to the settlement, even though he knew plaintiffs did not consent to the settlement and wanted to proceed to trial.
Up to that point, plaintiffs had great confidence and trust in defendant. Therefore, they felt helpless by reason of his threats. Ultimately, plaintiffs – – who could see no other way as defendant gave them no choice – – succumbed to defendant’s demands and threats and informed the Trial Court in the Medical Malpractice Action that they accepted the settlement negotiated by defendant and voluntarily executed general releases.
Plaintiffs later learned of defendant’s manipulations, duress, threats, intimidation, lies, false representations and coercion. But for defendant’s egregious conduct in this regard, plaintiffs would not have agreed to settle the underlying case, sign a general release and place the settlement on the record in open court.
Approximately one week later, defendant advised plaintiffs by phone that Columbia Presbyterian was demanding that the website be taken down “immediately” and “completely”.
However, plaintiffs understood that only “minor” changes had to be made to the website, and reminded defendant that is what he told them. In response, defendant replied that he would “work on it” and inform plaintiffs of the needed changes so that they could keep the website up and running .
Defendant did not return a single one of plaintiffs’ repeated phone calls inquiring about their website. To date, plaintiffs do not know what, if any, “work” defendant accomplished on the website issue.
On or about August 24, 1999, plaintiffs were advised by another law firm that the terms of the settlement required that we immediately and completely take down the website; that defendant’s representations to them that they merely had to make “minor” changes was erroneous and indeed appeared false; and that continuing with the website would expose plaintiffs to a defamation lawsuit.
Plaintiffs realized that defendant – – in whom they had placed their trust and confidence – – had defrauded and deceived them. Plaintiffs relied in good faith on defendant’s advice, promises, explanations, statements and representations. They did not know that defendant had lied to them in a fraudulent and deceitful attempt to induce them to accept the settlement of the Medical Malpractice Action.
Plaintiffs’ Motion to Vacate the Settlement
Plaintiffs moved to vacate the settlement and defendant’s lien for attorney’s fees upon the ground that their consent to the settlement had been procured by defendant’s fraud, deceit, lies, duress, coercion and breach of his fiduciary duties.
Richard Frank and Clare Pare moved separately to apportion and fix the attorney’s fees in the Medical Malpractice Action. These motions provided plaintiffs with new information not previously known regarding defendant’s fee arrangements with Mr. Frank and Ms. Pare, as well as the real reason for Mr. Frank’s dismissal. This new information underscored defendant’s duplicity and fraud. As made clear in the motion, with respect to fees, defendant had entered into a written agreement with Mr. Frank by which Mr. Frank was to receive 2/3 of the contingency fee, and that a notice of Mr. Frank’s retainer was filed with the Judicial Conference stating that Mr. Frank was to receive the standard statutory fee, and that defendant, as attorney of record, was to receive a fee “equal to the same percentage of attorneys’ fee that the attorneys’ fee bears to the total recovery.”
Plaintiffs never entered into a written agreement with Mr. Frank.
With respect to Ms. Pare, defendant apparently had, prior to plaintiffs signing the retainer agreement with her, asked for a 50% referral fee. He ultimately accepted Ms. Pare’s offer of a 1/3 referral fee.
However, in late February 1999, Ms. Pare received a letter from defendant demanding that his legal fee in the malpractice action be shared 50-50 with her. Pare told defendant he was mistaken and refused. In March 1999, Pare received a letter from defendant in which he claimed that “I intend and have always intended that Richard Frank conduct the case against Columbia Presbyterian and that I personally conduct the defense of Dr. Ralph Speken.”
After Pare was discharged, defendant immediately stated he would represent Dr. Speken on the counterclaim. Plaintiffs, no knowing of the fee schedule set forth in the Judiciary Law, agreed to pay him a contingent fee of 25% of the net proceeds.
The motions by Frank and Pare also revealed the true story as to how Mr. Frank came to be discharged. As noted above, plaintiffs received a letter from Frank simply advising that he was withdrawing as trial counsel. However, Mr. Frank’s withdrawal resulted from his objection to defendant’s fee arrangement which would allow him to recover more than allowed by the Judiciary Law in the event plaintiffs prevailed against the hospital.
On June 21, 1999, Ms. Pare advised Mr. Frank him that she had a disagreement with defendant about the division of fees for representing Dr. Speken; that she had been discharged as attorney on the counterclaim; and that defendant had taken over such defense himself. This was apparently the first time that Frank learned that defendant was going to receive an additional 25% contingent fee for representing Speken on the counterclaim.
On June 23, 1999, Frank told defendant that he believed defendant’s fee arrangement was improper, since in the event of a recovery by plaintiffs against Columbia Presbyterian, defendant would receive a much greater total attorney’s fee from his client’s share of the recovery than allowed, regardless of whether the hospital’s counterclaim was sustained.
After the settlement, Frank contacted defendant regarding apportionment of the attorney’s fees. However, defendant advised Frank that he was retaining the entire fee for himself .
Justice Heitler’s March 31, 2000 Order
In denying plaintiffs’ motion to vacate the settlement, Supreme Court held in pertinent part:
. . . a review of the record discloses no competent evidence of fraud, duress or other cause sufficient to invalidate this settlement [citation omitted]. Rather, it is clear that, at the time that the stipulation was made, plaintiffs were represented by counsel, knowingly and voluntarily entered into the stipulation in open court, and indicated that they were satisfied with the agreement and that their judgment was not impaired that day
However, the Court went on to explain that:
…plaintiffs must bear responsibility for Moore’s
alleged malfeasance in allegedly coercing them into
the settlement, and are relegated to relief against him
for any damages which his conduct may have caused them
[emphasis added].
With respect to Pare’s fee dispute with defendant, the Court agreed with plaintiffs’ contention that a separate lawyer was not needed to represent Dr. Speken on the counterclaim, and that defendant was wrongfully seeking to recover more money than permitted by the Medical Malpractice Fee Schedule set forth in Judiciary Law § 474-a(2). The Court pointed out that defendant “was obligated to handle the contingency presented by the counterclaim, and was not entitled to any increased fee for doing so.” The Court found that defendant’s retainer on the counterclaim was “clearly impermissible”.
Plaintiffs’ Second Action against Columbia Presbyterian
In or about July 2001, plaintiffs commenced an action against Columbia Presbyterian to vacate the settlement of the Medical Malpractice Action. Plaintiffs sought to vacate that provision of the settlement requiring that they expunge the website and keep silent about the death of Seth at the hands of Columbia Presbyterian. Plaintiffs urged that the settlement was illegal and against public policy, and wrongfully suppressed their First Amendment rights, as well as their moral responsibility to the public and their late son, to discuss and disseminate information regarding Columbia’s behavior which rose to the level of criminal misconduct. Plaintiffs’ claimed that the hospital’s malpractice constituted the crime of reckless endangerment in the second degree since it had violated a state law in connection with Seth’s death (New York State Mental Hygiene Law § 33.04).
The hospital moved to dismiss plaintiffs’ complaint upon the ground that the action was barred by res judicata because the enforceability of the settlement was addressed in the prior action.
By order dated March 8, 2002 , Judge Bransten granted the hospital’s motion upon the ground that “[r]es judicata…precludes [plaintiffs] from bringing this second action on matters that the parties litigated in the prior action”.
The Legal Malpractice Complaint
On July 1, 2002, plaintiffs commenced the instant action to, interalia, recover damages from defendant by reason of his malpractice and fraud and deceit in his representation of plaintiffs in the underlying Medical Malpractice Action. The complaint sets forth four causes of action. The first cause of action seeks damages based upon defendant’s fraud and deceit. The second cause of action seeks damages based upon defendant’s breach of fiduciary duty. The third cause of action seeks damages based upon defendant’s breach of contract. The fourth cause of action seeks damages based upon defendant’s legal malpractice. The complaint also seeks an award for punitive damages.
By notice of motion dated August 2, 2002, defendant moved to dismiss the complaint pursuant to CPLR 3211 (a)(1), (a)(5) and (a)(7). In support of the motion, defendant argued that the prior orders of Justice Klein-Heitler and Justice Bransten , barred plaintiffs’ malpractice and other claims under the doctrines of res judicata and collateral estoppel.
In opposition to the motion, plaintiffs demonstrated that Justice Klein-Heitler’s finding that there was no evidence of fraud by defendant were gratuitous, extraneous and not necessary to her penultimate decision – – namely, that the settlement was valid and enforceable from the standpoint of the hospital since it committed no fraud in entering into the settlement. Therefore, the specific issue as to defendant’s fraud, deceit and malpractice was not fully litigated such that plaintiffs’ claims are barred on res judicata and collateral estoppel grounds.
Indeed, plaintiffs pointed out that Justice Klein-Heitler specifically left open the issue of defendant’s malpractice in finding:
…plaintiffs must bear responsibility for Moore’s alleged
malfeasance in allegedly coercing them into the settlement,
and are relegated to relief against him for any damages
which his conduct may have caused them.
The April 15, 2003 Order Appealed From
By order dated April 15, 2003 and entered on April 23, 2003, Supreme Court (Tolub, J.) granted defendant’s motion and dismissed the complaint. The Court, agreeing with defendant, found that the doctrine of res judicata bars plaintiffs’ malpractice and related claims. The Court overlooked the fact that Justice Klein-Heitler specifically and expressly left open the issue of defendant’s culpable conduct vis-à-vis plaintiffs.
The Court’s alternative ground for dismissal, that plaintiffs “have not presented evidence supporting the contention that defendant’s negligent representation caused actual ascertainable damages”, was also improper as it goes well beyond an inquiry into the sufficiency of the complaint (the proper standard for a pre-answer motion to dismiss) and makes a determination on the ultimate merit of plaintiffs’ claims.
POINT I
PLAINTIFFS’ LEGAL MALPRACTICE
COMPLAINT IS SUFFICIENTLY PLED
AND SHOULD NOT HAVE BEEN DISMISSED
It is well-settled that on a motion to dismiss a complaint, the complaint is afforded a liberal construction. The court accepts the facts alleged in the complaint as true, accords plaintiffs the benefit of every possible favorable inference, and determines only whether or not the allegations fit within any cognizable legal theory. Campaign for Fiscal Equity, Inc. v. State, 86 N.Y.2d 307, 318, 631 N.Y.S.2d 565, 571 (1995)(“If we determine that plaintiffs are entitled to relief on any reasonable view of the facts stated, our inquiry is complete and we must declare the complaint legally sufficient”); Leon v. Martinez, 84 N.Y.2d 83, 87-88, 614 N.Y.S.2d 972, 974 (1994); Morone v. Morone, 50 N.Y.2d 481, 484, 429 N.Y.S.2d 592, 593 (1989); see also, M.M. v. E.M., 248 A.D.2d 109, 669 N.Y.S.2d 543 (1st Dep’t 1998); Gabriel v. Therapists Unlimited, L.P., 218 A.D.2d 614, 631 N.Y.S.2d 34 (1st Dep’t 1995).
The sole criteria on a 3211(a)(7) motion to dismiss is whether the complaint states a cause of action. If factual allegations are discerned from the complaint’s four corners, which, taken together, manifest any cause of action cognizable at law, a 3211(a)(7) motion for dismissal will fail. Guggenheimer v. Ginzburg, 43 N.Y.2d 268, 401 N.Y.S.2d 182 (1977)(the court should only be concerned with “whether the proponent of the pleading has a cause of action, not whether he has stated one”); Paulsen v. Paulsen, 148 A.D.2d 685, 686, 539 N.Y.S.2d 433, 434 (2d Dep’t 1989)(plaintiff has no obligation to demonstrate evidentiary facts to support the allegations contained in the complaint); Palmisano v. Modernismo Publications, Ltd., 98 A.D.2d 953, 470 N.Y.S.2d 196, 198 (4th Dep’t 1983); Siegel, Practice Commentaries, CPLR 3211:24.
A motion to dismiss is not concerned with the presence or absence of disputed facts. Rather, it is only directed to the sufficiency of the pleadings and whether the complaint states a cause of action. Sanders v. Winship, 57 N.Y.2d 391, 394, 456 N.Y.S.720 (1982) (“Whatever an ultimate trial may disclose as to the truth of the allegations, on such a motion, a court is to take them as true and to resolve all inferences which reasonably flow therefrom in favor of the pleader”). Indeed, the court’s inquiry is not addressed to whether the plaintiff may ultimately be successful on the merits. Stukuls v. State of New York, 42 N.Y.2d 272, 275, 397 N.Y.S.2d 740; Ferrandino v. Alvin J. Bart & Sons, Inc., 247 A.D.2d 428, 668 N.Y.S.2d 99 (2d Dep’t 1998); Detmer v. Acampora, 207 A.D.2d 475, 616 N.Y.S.2d 506, 507 (2d Dep’t 1994)(defendant’s motion to dismiss was properly denied since “the court is not concerned with determinations of fact or the likelihood of success on the merits”).
Here, accepting the facts alleged in the complaint as true, and according the pro se plaintiffs the benefit of every possible favorable inference, the complaint, as a matter of pleading, properly pleads the aforementioned four causes of action against defendant. The complaint alleges, interalia, that:
– defendant “threatened” plaintiffs into requesting the Trial Court that Mr. Frank be discharged;
– defendant told plaintiffs they had “no choice” but to accept the settlement with the hospital and sign the general release because, among other things, the Trial Judge was “corrupt” and there was no use in talking to her; the hospital intended to commence a “multi-million dollar” defamation lawsuit against plaintiffs and defendant would not represent them therein; and defendant would resign from the Medical Malpractice Action if plaintiffs did not accept the settlement ; and
– plaintiffs relied, in good faith, on defendant’s
fraudulent and false promises, statements and
representations respecting the scope of the settlement
vis-à-vis the website and would not have entered into
the settlement had they known that the promises,
statements and representations were untrue.
Under these circumstances, plaintiffs’ causes of action for fraud and deceit, breach of fiduciary duties, breach of contract, negligence and legal malpractice, are sufficiently pled. Campaign for Fiscal Equity, Inc. v. State, supra; Leon v. Martinez, supra; Guggenheimer v. Ginzburg, supra; see also, Paulsen v. Paulsen, supra.
Significantly, in his pre-answer dismissal motion, defendant did not contend that the complaint was insufficiently pled or failed to state a cognizable claims. Nor did (or could) defendant ask the Court to engage in a determination over disputed facts. Rather, defendant argued that plaintiffs’ causes of action for breach of contract, negligence and malpractice were barred by the doctrines of res judicata and collateral estoppel based upon Supreme Court’s orders in the prior actions against the hospital. No factual analysis was sought and plaintiffs were not called upon to demonstrate evidentiary facts supporting the complaint. Paulsen v. Paulsen, supra (plaintiff has no obligation to demonstrate evidentiary facts to support the allegations contained in the complaint).
However, Supreme Court, in contravention of the standard of review on a pre-answer motion to dismiss, improperly made findings of fact as to the ultimate merit of plaintiffs’ claims. The Court, after engaging in a factual determination on the issues of negligence and breach of contract, found that plaintiffs “have not presented evidence supporting the contention that defendant’s negligent representation caused actual ascertainable damages.” Supreme Court’s finding in this regard was improper and cannot support dismissal of the complaint. Guggenheimer v. Ginzburg, supra; Paulsen v. Paulsen, supra; Palmisano v. Modernismo Publications, Ltd., supra.
Accordingly, since the allegations set forth in the complaint sufficiently place defendant on notice pursuant to CPLR 3013 that plaintiffs seek damages based upon defendant’s malpractice, the order appealed from should be reversed and the complaint reinstated.
POINT II
PLAINTIFFS’ LEGAL MALPRACTICE
COMPLAINT IS NOT BARRED BY THE
DOCTRINE OF RES JUDICATA
Although the doctrines of collateral estoppel and res judicata preclude a party from relitigating an issue necessarily raised and decided against that party provided there was a full and fair opportunity to litigate the point, “[g]ratuitous findings will not support an estoppel.” Siegel, New York Practice, 3d ed., § 465 at 747.
Supreme Court’s finding that the instant complaint is barred by res judicata by virtue of the decisions of Justice Heitler and Justice Bransten , is misplaced. Justice Heitler denied plaintiffs’ motion to vacate the underlying settlement based on her “essential” finding that there was no evidence of fraud on the part of Columbia Presbyterian or its attorneys. See, Nash v. Y and T Distributors, 207 A.D.2d. 779, 616 N.Y.S.2d 402 (2d Dep’t 1994)(“the forgery which forms the basis for the plaintiff’s claim is not the type of fraud which would invalidate the settlement, since it is fraud between the party to the settlement and her [attorney], and not between the parties to the contract”); Heimuller v. Amoco Oil Co., 92 A.D.2d 882, Heimuller (2d Dep’t 1983)(since the record reveals no false representation by [defendant] upon which [plaintiff] relied in entering the stipulation, there has no been no showing of fraud, actual or otherwise).
Once Justice Heitler found that there was no evidence of fraud on Columbia Presbyterian’s part, it follows that the remainder of her other findings in her decision – – that there was no evidence of fraud by defendant herein – – were “gratuitous”, extraneous and not necessary to her penultimate decision. Justice Heitler’s findings that there was no evidence of defendant’s fraud and coercion in obtaining plaintiffs’ consent to the settlement of the Medical Malpractice Action, is “gratuitous” and does not bar plaintiffs’ from litigating the issue of defendant’s malpractice and other wrongdoing in his representation of them in the Medical Malpractice Action. Therefore, such gratuitous findings are not subject to the doctrine of collateral estoppel.
Indeed, Justice Heitler expressly left open the issue of defendant’s culpable and negligent conduct in his representation of plaintiffs, and seemed to indicate that a malpractice action against defendant would lie. She specifically explained that:
Under these circumstances, plaintiffs, not [Columbia Presbyterian], must ‘bear the responsibility for their attorneys’ misfeasance (Hallock v. State, 64 NY2d at 229). Accordingly, here, plaintiffs must bear the responsibility for Moore’s alleged malfeasance in allegedly coercing them into the settlement, and are relegated to relief against him for any damages which his conduct may have caused them [emphasis added].
Justice Heitler was aware that an issue of fact was involved in plaintiff’s claim that they had been placed under duress by defendant. As set forth in the certified court transcript of a hearing regarding the lawyers’ fees held before the Judge on November 30, 1999 (Vicki K. Glover, Official Court Reporter [complete transcript available on request]):
THE COURT: Then if you felt you were under duress, why didn’t you say- – when I asked each of you is anybody forcing you or whatever, why didn’t you at that point say to the Court what you are saying to the Court now?
DR. SPEKEN: Your Honor, this has been a situation where for weeks we were on a roller-coaster, going to trial, not going to trial; there is a case, there is no case; when suddenly this call came from Mr. Moore on July 8th, we had to rush down here to be in court to settle this thing. And we asked him – we told him we did not want to sign anything that gave away our First Amendment rights, and he said you better sign. It’s going to go very, very badly. The Court if corrupt.
THE COURT: The Court is what?
DR. SPEKEN: The Court is corrupt. That’s what he said. I didn’t have a tape recorder, but this what he said. We were so frightened, and we were on such a period – the Court has to realize we’re in a constant grief, basically, and this was years of this thing and suddenly we’re going to trial, we were in a state of severe emotional distress and our lawyer, who at that point we had a sense of trust in, is telling us: You now must settle. You’re going to commit suicide if you don’tsettle. I have no choice. I can’t go to court against Miss Shapiro because she is going to crush me if I try to oppose her. So therefore, I’m going to resign from your case and you’re going to have to do this pro se in the following week. And don’t speak to the Judge about this because don’t forget, the Court is corrupt. Think of Clinton. So my wife, my wife and I –
MS SPEKEN: I asked Mr. Moore to go back and speak to you if I could have a day to think about this. It was coming on too fast. I couldn’t even understand the settlement retainer agreement, and we were outside. He comes rushing back. He said you refused.
DR. SPEKEN: He said he had no time to get to you and, like, he opened the door and closed the door and he was right back and he never spoke to you at all. The Court must realize how dear we hold this issue of being able to speak completely about what happened to our boy. It is so important. I woke up today to read in the paper that the National Academy of Sciences has picked up on an idea which was basically first floated on the Internet and on our web site that a national governmental organization is needed to get hold of the issues of medical mistakes and that people are infinitely safer in the air than they are going to a hospital. This first came out in our website.
THE COURT: I think two things have to be clearly said for this record. This is a 1994 case and I know that a great deal of time and effort was put into this case in terms of trying to resolve it, and when it came to the time, and I do not have the actual card in front of me, that this case was going to be tried, and I know that there was more than one adjournment for various reasons, some because people were not prepared to go forward and others because there was an effort to try to resolve the case. So that’s number one. Number two, it’s quite unfortunate, and I don’t know what Mr. Moore said to you or did not say to you about the court system. What I can say is, is that when a case is as old as this one is, and that’s unfortunate, that there does come a point when a case has to either be tried or settled, and there did come a point when I was advised that this case was settled, and there is the time, of course, that we asked each of you to express yourselves on the record. You are now advising this Court that you were doing that under duress and I will have to read your papers and this opens up interesting questions as to whether the settlement should stand, whether you have other rights in this case and clearly, I will carefully consider everything that has been put before me. Thank you very much [emphasis added].
In stating that “I don’t know what Mr. Moore said to you or did not say to you” (i.e., about his assertion that “The Court is corrupt,”) Judge Heitler was implicitly acknowledging that there was an Issue of Fact that could only be resolved by a jury. Only a jury could make a decision as to who was telling the truth. The Supreme Court’s finding that “plaintiffs’ claims in the instant matter have either already been litigated or could have been litigated,” is incorrect. By her own declaration, Justice Heitler did not address – – and clearly left open – – the specific issue of plaintiffs’ recourse against defendant for his malpractice in representing them in the Medical Malpractice Action. Indeed, in vacating defendant’s retainer agreement in part, Justice Heitler recognized defendant’s malfeasance.
Nevertheless, in dismissing the complaint, Supreme Court obviously relied upon (as did defendant in his motion) Justice Heitler’s gratuitous findings , that there was no evidence of fraud, duress or coercion on the part of defendant. However, Justice Heitler’s summary decision in this regard is incorrect, was made without an evidentiary hearing and do not support dismissal of the malpractice complaint.
Therefore, Supreme Court’s finding that “plaintiffs’ claims in the instant matter have either already been litigated or could have been litigated,” is incorrect. By her own declaration, Justice Heitler did not address – – and clearly left open – – the specific issue of plaintiffs’ recourse against defendant for his malpractice in representing them in the Medical Malpractice Action. Indeed, in vacating defendant’s retainer agreement in part, Justice Heitler recognized defendant’s malfeasance.
Thus, the Supreme Court’s reliance on Justice Heitler’s gratuitous findings, that there was no evidence of fraud, duress or coercion on the part of defendant, was misplaced. Justice Heitler’s summary decision in this regard was gratuitous, incorrect, made without an evidentiary hearing and did not support dismissal of the instant malpractice complaint.
It is well settled that in order to establish a claim for fraud and deceit, it must be shown that the defendant (1) made a representation, (2) as to a material fact, (3) which was false, (4) and known to be false by the defendant, (5) that the representation was made for the purpose of inducing the other party to rely upon it, (6) that the other party rightfully did so rely, (7) in ignorance of its falsity (8) to his injury. 24 N.Y. Jur., Fraud and Deceit, § 14; 37 C.J.S. Fraud § 3.
The instant record makes it unequivocally clear that at the time plaintiffs signed the General Release in open court, they were each under severe duress and emotional strain by reason of defendant’s lies and misrepresentations about the Court, as well as his threats to abandon them in the Medical Malpractice Action (as well as the potential defamation suit) at the eleventh hour. At the time the settlement was signed, plaintiffs still trusted defendant’s honesty and integrity and had no cause to believe that anything he said was not true. It was precisely their trust and respect that enabled defendant to defraud plaintiffs and put them under duress. Plaintiffs had no inkling at that time that they were victims of multiple fraudulent acts. Indeed, the essence of successful fraud is that victims such as us are totally unaware of what is happening. In this case, defendant was successful.
Among the many deceitful representations defendant made to plaintiffs to induce them to sign the general release in open court, was his statement that “The Court is corrupt. Just look at the President Clinton fiasco. This would mean the end for you.” This statement came in response to Dr. Speken’s request that he be allowed to speak with Justice Heitler in order to request an adjournment of the trial for plaintiffs to find new counsel.
Thus, Justice Heitler’s finding that plaintiffs claims of duress and coercion was undermined by the fact that they were under oath and had an obligation to inform the Court that they “…did not want to settle and/or that they were under duress”. To the contrary, based upon defendant’s misrepresentations and lies about the Court, plaintiffs were in great fear of Justice Heitler and signed the release when she asked them to. Under the circumstances, plaintiffs could not have been expected to have reacted or behaved in any other way.
Second, Justice Heitler’s finding that plaintiffs voluntarily gave up their First Amendment rights because they signed the General Release, is incorrect. Defendant induced plaintiffs to believe that only “minor” changes had to be made to the website. When plaintiffs eventually learned what Moore had done, they immediately re-published the website on the Internet.
Plaintiffs’ signatures on the general release should not now be used to bar their claims to recover for Moore’s legal malpractice. Home Ins. Co. v. Liebman, Adolf & Charme, 257 A.D.2d 424, 683 N.Y.S.2d 519 (all the plaintiffs are “…required to plead, with sufficient detail, that, but for the attorney’s alleged malpractice, plaintiff would have avoided some “actual ascertainable damage”…and settlement, when compelled by an attorney’s breach of the standard of care, alleged herein, does not constitute an intervening cause barring a claim for legal malpractice”).
Third, defendant’s threat that plaintiffs faced a “multi-million dollar lawsuit” from the Hospital, was highly relevant, contrary to Justice Heitler’s finding. Plaintiffs believed defendant’s threat, had no reason to doubt him and at the time and had no way of knowing that it was yet another of defendant’s fraudulent statements. Plaintiffs had a reasonable and logical fear of a defamation suit with no lawyer to defend them. The Judge’s opinion on this matter is without merit.
Finally, Judge Heitler’s statement that “nothing revealed in the fee dispute between plaintiffs’ various counsel suggests that plaintiffs’ agreement to settle this case was procured by fraud,” is contradicted by the Court’s own findings respecting defendant’s acts and omissions as to his fee arrangements with Ms. Pare and Mr. Frank. Indeed, these findings further demonstrate defendant’s malfeasance and breach of fiduciary duties owed to plaintiffs.
Defendant unnecessarily brought on a third lawyer, only to force plaintiffs to discharge her when it became clear that he would be able to financially benefit from her absence. Judge Heitler correctly rejected defendant’s claim to an additional $90,625 in fees from the settlement.
Further, upon learning of defendant’s deceitful manipulation as to fees, Mr. Frank, defendant’s co-counsel, resigned. Defendant, instead of retaining new co-counsel as he had promised, then threatened to abruptly resign from the case if plaintiffs did not sign the General Release. Plaintiffs were faced with the termination of their suit against the hospital and a defamation suit aimed against them.
After successfully coercing plaintiffs into signing the General Release (by guerilla fright tactics), defendant then claimed for himself the entire contingency fee of $137,500. Plaintiffs would not have been aware of defendant’s improper (and unethical) fee hording had Mr. Frank failed to seek his share of the legal fee resulting from the settlement.
Justice Heitler correctly restored Mr. Frank’s right to compensation for work performed, recognizing the impropriety of defendant’s attempts to deprive his co-counsel of their rightly earned fees.
Manifestly, Justice Heitler’s findings on the fee issue and setting the matter down for a hearing establish that defendant’s behavior in the fee dispute was indefensible. In this light, her declaration that plaintiffs “are relegated to relief against [defendant] for any damages which his conduct may have caused them,” confirms that her decision does not foreclose a legal malpractice action by plaintiffs against defendant.
The mere fact that Justice Heitler summarily decided to permit defendant’s lien against the settlement does not preclude plaintiffs’ malpractice claims. Although plaintiffs discharged defendant as their attorney for cause, Justice Heitler’s decision on the issue of the grounds for discharge (fraud, duress, coercion, negligence) was rendered without a hearing, as isrequired. See, Teichner v. Holsteins, Inc., 64 N.Y.2d 977, 489 N.Y.S.2d 36 (1985)(“Hearing was required to determine if attorney was discharged for cause or, if he was discharged without cause before completion of his services, for determination of his fee on quantum meruit basis”); Genton v. Arpeggio Restaurant, Inc., 232 A.D.2d 274, 648 N.Y.S.2d 552 (1st Dep’t 1996) (noting that hearing was required to determine whether attorney was “discharged for cause, and if not, whether he is entitled to compensation and in what amount”).
Thus, her finding that there was no evidence of fraud, duress and coercion, is not conclusive as to whether plaintiffs may maintain the instant legal malpractice action. Indeed, defendant’s fraud and malpractice in the Medical Malpractice Action, not only against plaintiffs, but against Frank and Pare as well, should not be summarily dismissed at the early stage of this litigation. The record discloses that defendant, who had convinced plaintiffs that he would handle the counter-claim at trial, never had any intention at all to go to trial. Defendant never even obtained the files from Mr. Frank and Ms. Pare.
Under these circumstances, Justice Heitler’s summary conclusion that plaintiffs were not defrauded by defendant, is not a sufficient basis to deny plaintiffs their right to pursue their malpractice claims against him. See, Bennardo v. Equitable Land Service, Inc., 244 A.D.2d 304, 663 N.Y.S.2d 892, 893 (2d Dep’t 1997)(noting that Disciplinary Committee’s determination which was summary in nature and made without the benefit of a hearing at which the plaintiff could have testified, was not entitled to res judicata or collateral estoppel effect on the issues raised in a subsequent civil action commenced by the plaintiff against his former attorney to recover damages for fraud).
Similarly, Justice Bransten’s decision, which dealt solely with plaintiffs’ claims to invalidate the settlement as to the hospital upon the ground that it violated their Constitutional rights, does not provide an adequate basis to bar the malpractice claim against defendant under the doctrines of collateral estoppel or res judicata.
In Gilberg v. Barbieri, 53 N.Y.2d 285, 441 N.Y.S.2d 49 (1985), then Chief Judge Wachtler discussed the requirements for collateral estoppel. In Gilberg, the defendant, a lawyer, sought collateral estoppel against the civil suit of another lawyer he had assaulted. The defendant argued that he had already been convicted of harassment in another court. In pertinent part, Justice Wachtler explained:
[t]he question as to whether a party has had a full and fair opportunity to contest a prior determination cannot be reduced to a formula. It cannot, for instance, be resolved by a finding that the party against whom the determination is asserted was accorded due process in the prior proceeding…The point of the inquiry, of course, is not to decide whether the prior determination should be vacated but to decide whether it should be given conclusive effect beyond the case in which it was made.”
It would be fundamentally unfair to use Justice Heitler’s gratuitous comments regarding defendant’s fraud and deceit to bar plaintiffs’ malpractice claims without a determination on the merits. There is no valid reason (and defendant in his motion failed to offer any) to rely on Justice Heitler’s decision, since it was focused on the validity of the settlement as between plaintiffs and the hospital, and not on the fraud committed by defendant against plaintiffs.
Moreover, as demonstrated above, Justice Heitler’s findings as to whether plaintiffs’ agreement to enter into the settlement was occasioned by defendant’s fraud, duress and coercion, are wholly contradicted by the record. Indeed, this Court’s December 21, 2000 decision affirming Justice Heitler’s order did not specifically address the issues of fraud, coercion and duress on the part of defendant.
Accordingly, plaintiffs’ malpractice complaint is not barred by res judicata. Thus, the order appealed from should be reversed and the complaint reinstated.
POINT III
PLAINTIFFS’ LEGAL MALPRACTICE
COMPLAINT STATES A VALID CLAIM
FOR PUNITIVE DAMAGES
The purpose of punitive damages is to “vindicate public rights.” Rocanova v. Equitable Life Assur. Socy., 83 N.Y.2d 603, 613, 612 N.Y.S.2d 339 (1994).
Here, plaintiffs are entitled to recover punitive damages because defendant’s “egregious tortuous conduct” was so outrageous as to evince a “high degree of moral turpitude”and “wanton dishonesty as to imply a criminal indifference to civil obligations,” Rocanova, supra, and recovery of punitive damages is necessary to vindicate a “public right” since defendant is an attorney. Ibid, at 613, 612 N.Y.S.2d 339.
Defendant’s misconduct in the medical malpractice action, as alleged in the complaint was egregious, morally culpable and warrants imposition of punitive damages. Moreover, defendant has a demonstrated history of deceit, fraud, coercion, and generally unethical behavior not only in the instant case but also in other cases. Following is a brief description of documented incidents of this behavior:
I. STATE OF NEW YORK
DIVISION OF TAX APPEALS
In the Matter of the Petition
of
THOMAS AND MARGARET MOORE
DETERMINATION DTA NO. 816357
for Redetermination of a Deficiency or for Refund of New York State and New York City Personal Income Taxes Under Article 22 of the Tax Law and the Administrative Code of the City of New York for the year 1993 In this matter before the New York State Tax Appeals Court, defendant sought to dispute a deficiency of $5,244.81 The NYS Department of Taxation and Finance determined that income from Steinhardt Partners, one of the partnerships owned by the late Mrs. Moore and listed on the return was reported incorrectly.
The amount of the underreported income was substantial. The income of defendant (and spouse) was revised upwards from $457,235 to $2,739,094. In a federal audit, there would be considerable fines and penalties assessed, at a minimum.
In several instances in the Decision, auditors requested a copy of the federal amended return. These were never produced with the explanation that they were in the process of completion. It is entirely possible that these proceedings were actually a delaying tactic. The six years statute of limitations for 1993 returns timely filed would be April 15, 2000. The date of the New York State Determination was May, 1999.
Defendant therefore either did defraud or sought to defraud the Federal
Government out of paying taxes on $2,281,859. Defendant may claim that this failure to report this income was “negligence” but this could hardly be the case. From his book, “Plantagenet Descent” (Gateway Press, Inc. Baltimore, MD. 1995) in referring to himself defendant states (p. 194), “The American Lawyer referred to him as “the renowned international tax lawyer.”” The book is replete with defendant’s examples of being a tax lawyer of the highest of skill. Such a lawyer does not make a “mistake” of failing to report income of over 2 million dollars for income tax purposes. Rather it is a prime example of the fact that defendant has the willingness and capacity to, without qualms, commit fraud of the most egregious and risky type as long as it leads to personal gain.
II. Gideon Panther, M.D., in a personal communication, reports being defrauded of a
substantial sum by defendant in a matter in which he represented the physician. The physician appealed to the Bar Association of the City of New York and defendant was required to return the money. Dr. Panther referred to the defendant as a “dangerous predator.”
III. In Federal Insurance Company v. Thomas R. Moore, Sup. Ct. N.Y. Co.,
defendant was accused of improperly receiving money from his former law firm that had been paid by Federal. The case was sealed and “settled”.
IV. In the case of Speken v. Columbia, defendant sought contrary to law to obtain the entire contingency fee of $137,500 for himself as well as an additional $90, 625 to which he was also not legally entitled.
Courts have awarded punitive damages against lawyers for the same type of misconduct alleged herein. For example, Justice Shainswit of this Court awarded a client $75,000 in compensatory damages and $25,000 in punitive damages against her attorney based on the Court’s findings that the defendant attorney “shirked his professional duties” which he compounded with a pattern of “misrepresentation” to the client, failed to behave “responsibly” and speak “truthfully”, and “deliberately concealed the true facts” and “expressly lied to [the clients] about the status of the case.” Matter of Simenowitz, 223 A.D.2d 252, 644 N.Y.S.2d 1001(2d Dep’t 1996).
This is not a mere breach of contract claim. Rather, the record is replete with factual allegations showing defendant’s morally culpable and reprehensible conduct which is sufficient to state a valid claim for punitive damages. Giblin v. Murphy, 73 N.Y.2d 69, 536 N.Y.S.2d 54 (1988); D’Antoni v. Ansell, 84 A.D.2d 678, 585 N.Y.S.2d 459 (2d Dep’t 1992).
Most importantly, defendant sought to completely destroy plaintiffs’ First Amendment rights to freely and publicly discuss the tragic death of their son. By entering into an agreement which completely dismantled plaintiffs’ website (while at the same time informing plaintiffs that only “minor” changes needed to be made to the site), defendant unilaterally destroyed plaintiffs’ First Amendment rights. In order to obtain compensation from the Hospital for Seth’s death, plaintiffs must maintain the silence they promised due to defendant’s coercion. Plaintiffs would not have agreed to take down the website in toto were it not for defendant’s malpractice. Plaintiffs never intended to waive their First Amendment rights. Therefore, plaintiffs’ complaint clearly and sufficiently states a claim to recover financial damages in the sum of $500,000 due to defendant’s malfeasance which has prevented plaintiffs from recovering the $500,000 settlement.
Defendant, prior to even answering the complaint, seeks to deprive plaintiffs of their day in Court in violation of our Seventh Amendment right to a trial as well as our Fourteenth Amendment right to due process.
Justice Klein-Heitler’s gratuitous comments that she did not believe plaintiffswere coerced belies the fact that her admitted primary concern was the “settlement” of the case, rather than a vigorous pursuit of justice. Given that the Judge had said she had “did not know what Mr. Moore said to you or did not say to you about the Court system,” her summary opinion cannot be considered probative let alone conclusive as to who was telling the truth. She could have a personal opinion, but only a jury – – the Trier of Fact–can render a decision on the issue of disputed facts. Either the Spekens lied or Mr. Moore lied. And it must be pointed out that Mr. Moore has a record of lying — big time. The Judge’s comments that she saw no fraud were purely gratuitous and not entitled to res judicata preclusive effect.
A tax lawyer who seeks to defraud the Federal Government out of taxes on over $2, 281,859 of income is certainly capable of the coercive and fraudulent acts reported by the plaintiffs. Defendant’s behavior towards plaintiffs was morally and legally culpable and it would be the highest ethical abuse to deprive them of their Constitutional right to bring this matter before a jury. Only a jury is empowered to render a decision on what tactics defendant used against the plaintiffs. Given Mr. Moore’s documented unethical behavior in other matters, why would the New York State Court System want to shelter him from Justice?
Accordingly, the order appealed from should be reversed and the complaint reinstated including the cause for punitive damages.
CONCLUSION
FOR THE FOREGOING REASONS, THE ORDER
APPEALED FROM SHOULD BE REVERSED;
DEFENDANTS’ MOTION DENIED; AND PLAINTIFFS’
COMPLAINT AGAINST DEFENDANT REINSTATED
Dated: December 18, 2003
Bronxville, New York
Respectfully submitted,
RALPH H. SPEKEN, M.D
STEPHANIE Z. SPEKEN, M.S.
Plaintiffs-Appellants Pro Se
81 Pondfield Road, No. 179
Bronxville, New York 10708