COBY GROUP LLC v. KRISS (2009)

Order, Supreme Court, New York County (Michael D. Stallman, J.), entered July 2, 2008, which, following the conversion of defendants attorneys' (collectively Kriss) preanswer motion to dismiss to a motion for summary judgment, granted defendants summary judgment dismissing the complaint, unanimously affirmed, with costs.

Plaintiff alleges that Kriss represented it in connection with its efforts to obtain financing for a purchase of real estate, and that Kriss betrayed plaintiff by representing two potential co-venturers (collectively Adjmi) whose interests were adverse to plaintiff.   Summary judgment was properly granted on the basis of the release that plaintiff gave Adjmi in settlement of an action that Adjmi brought to enjoin plaintiff's dealings with the prospective purchaser of the real estate on flip sale from plaintiff. That release, in clear and unambiguous terms, broadly and expressly releases Adjmi's “agents and attorneys from any and all liability and accountability, directly or derivatively through Coby or otherwise” (see Wells v. Shearson Lehman/American Express, 72 N.Y.2d 11, 530 N.Y.S.2d 517, 526 N.E.2d 8 [1988];   Argyle Capital Mgt. Corp. v. Lowenthal, Landau, Fischer & Bring, 261 A.D.2d 282, 690 N.Y.S.2d 256 [1999], lv. denied 93 N.Y.2d 817, 697 N.Y.S.2d 564, 719 N.E.2d 925 [1999] );  it does not limit the word “ attorneys” and does not exclude the claims that plaintiff asserts herein.   We reject plaintiff's contention that the release bars its claims against Kriss only in his capacity as Adjmi's attorney, not as plaintiff's attorney.   First, at the time of the release plaintiff's principals were aware that Kriss was representing Adjmi;  second, the record does not support a reasonable belief by plaintiff that it was ever represented by Kriss separate and apart from his representation of Adjmi (see Jane St. Co. v. Rosenberg & Estis, 192 A.D.2d 451, 597 N.Y.S.2d 17 [1993], lv. denied 82 N.Y.2d 654, 602 N.Y.S.2d 803, 622 N.E.2d 304 [1993] ).   Plaintiff, a sophisticated real estate investment company, was introduced to Kriss by Adjmi when plaintiff and Adjmi were contemplating a joint venture.   While it appears that Kriss purported to represent plaintiff while Adjmi and plaintiff had coinciding interests in obtaining financing, Kriss did so primarily in order to protect Adjmi's investment in the venture.   The record demonstrates that plaintiff and Adjmi were at all times represented by separate counsel who worked together while their clients' interests were aligned, and stopped working together once their interests diverged.   We have considered plaintiff's other arguments and find them unavailing.