LLC v. LLP (2016)

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Order, Supreme Court, New York County (Cynthia S. Kern, J.), entered September 11, 2015, which granted defendant's motion to dismiss the complaint for failure to state a cause of action, unanimously affirmed, with costs.

“An action for legal malpractice requires proof of three elements:  (1) that the attorney was negligent;  (2) that such negligence was a proximate cause of plaintiff's losses;  and (3) proof of actual damages” (Global Bus. Inst. v. Rivkin Radler LLP, 101 AD3d 651, 651 [1st Dept 2012] [citation omitted] ).  “[T]he failure to show proximate cause mandates the dismissal of a legal malpractice action regardless of whether the attorney was negligent” (id.), and for this reason, Excelsior's claims were properly dismissed.

In the underlying action, the Second Department found that the trial court erred in dismissing Excelsior's causes of action to recover upon the guarantor's three personal guarantees, finding that a jury could have found that the guarantor consented to the extensions of said guarantees, and remitted the matter for a new trial on those causes of action (Excelsior Capital, LLC v Superior Broadcasting Co., Inc., 82 AD3d 696, 699 [2d Dept 2011] [internal citations omitted] ).  The trial court's error in that enforcement action was “independent of or far removed from the [attorney's] conduct,” and therefore constituted an intervening cause, breaking any proximate cause by the defendants (Kriz v. Schum, 75 N.Y.2d 25, 36 [1989], quoting Derdiarian v. Felix Contr.  Corp., 51 N.Y.2d 308, 315 [1980] ).  In any event, plaintiff's causation theory is speculative.

“[T]he ‘selection of one among several reasonable courses of action does not constitute malpractice’ ” (Zarin v. Reid & Priest, 184 A.D.2d 385, 387 [1st Dept 1992] ).  The issue in this case is a May 26 letter which merely reserved Excelsior's rights while the parties worked out a possible forbearance agreement and redocumentation of the notes and guarantees, and did not ask the guarantor to reaffirm his guarantees.  This was a reasonable course of action based on statements made by the guarantor's attorney as to the continuing validity of the guarantees, and the fact that the parties were attempting resolution of this matter.  More importantly, it was speculative to believe that the guarantor would have provided such a reaffirmance, since if prompt resolution was not reached, litigation was likely (see Sherwood Group v Dornbush, Mensch, Mandelstam & Silverman, 191 A.D.2d 292, 294 [1st Dept 1993] ).

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CLERK