Legal Malpractice

Resignation and the End of the Line in Legal Malpractice

By (Andrew Lavoott Bluestone)

Some states have mandatory legal malpractice insurance, but New York does not.  Result?  Plaintiffs who have suffered real damages at the hands of uninsured attorneys pursue them, and cannot collect their actual damages from the attorneys.  Here is one sad example. Matter of Jobi
2010 NY Slip Op 01704 ;Decided on March 2, 2010 ;Appellate Division, First Department .
 

Not only did this attorney convert monies, which the Clients' Fund reimbursed, but the attorney avoided several legal malpractice judgments.  It is a violation of attorney ethics to avoid satisfying a judgment which arises from professional acts, but, in this case, the attorney could [apparently] care less.

"Respondent's affidavit of resignation, sworn to on December 21, 2009, complies with 22 NYCRR 603.11[a][1-3] in that she states: (1) her resignation is rendered freely, voluntarily, without coercion or duress and that she is fully aware of the implications of submitting her resignation; (2) she is aware of a pending investigation based upon allegations of deceit involving the conversion of funds held in escrow, giving false testimony with respect thereto and the failure to satisfy judgments entered against her by two former clients and a third party; and (3) she acknowledges that if charges were predicated upon the misconduct under investigation by the Committee, she could not successfully defend herself.

With respect to one of the charges of conversion, it is alleged that respondent converted the sum of $21,250 which she deposited into her escrow account after she received the same from a real estate contract vendee named Jean John. A default judgment John subsequently obtained against respondent as a result of the conversion remains unsatisfied. Two other judgments entered against respondent in legal malpractice actions brought by former clients also remain unsatisfied. The Committee has reviewed respondent's affidavit, found it in compliance with Rule 603.11 and recommends its acceptance by this Court.

Pursuant to Judiciary Law § 90(6-a)(a), restitution may be ordered in a disciplinary proceeding where that attorney has wilfully misappropriated or misapplied money or property in the practice of law. An order directing such restitution may be entered as a civil judgment (Judiciary Law § 90[6-a][d]). Here, an order directing restitution would be futile in light of the fact that John has entered judgment against respondent as set forth above. In any event, respondent should reimburse the Lawyers' Fund for Client Protection of the State of New York as provided for by the statute.

Accordingly, the Committee's motion should be granted to the extent that respondent's resignation be accepted,
 

Full post as published by New York Attorney Malpractice Blog on March 03, 2010 (boomark / email).