No Proof Of Deceit

The New York Court of Appeals affirmed the dismissal of claims brought against an attorney by a former client

Judiciary Law § 487 provides that “[a]n attorney or counselor[ ] . . . guilty of any deceit or collusion, . . . with intent to deceive the court or any party[,] . . . forfeits to the party injured treble damages, to be recovered in a civil action.” This appeal presents the question of whether a Judiciary Law § 487 claim may be brought in a plenary civil action where a plaintiff alleges that attorney deceit led to an adverse judgment or order. Given the unique concerns addressed by this statute, we hold that such a plenary action lies. We nevertheless affirm the Appellate Division’s order on alternative grounds.

Facts

In 2005, Delfina Urias retained defendants Daniel P. Buttafuoco and Daniel P. Buttafuoco & Associates, PLLC1 to represent her and her husband, Manuel Urias, in a medical malpractice action stemming from a surgery that left Mr. Urias in a coma. Because Mr. Urias was incapacitated, Buttafuoco obtained a guardianship order authorizing Ms. Urias to prosecute and settle the medical malpractice action on her husband’s behalf, “subject to prior court approval of legal fees and settlement.” Ms. Urias agreed to settle the action for $3.7 million. During an April 2, 2009 hearing on the proposed settlement, Ms. Urias expressly confirmed that she understood and consented to the terms of the settlement, which included a deduction of legal fees and expenses per her retainer agreement with Buttafuoco. That agreement reproduced the contingency fee schedule for medical malpractice lawsuits set forth in Judiciary Law § 474-a and stated that “expenses and disbursements for expert testimony and investigative or other services properly chargeable to the enforcement of the claim or prosecution of the action” would be deducted from the amount recovered. At the close of the hearing, the court stated that the matter was settled for $3.7 million, making no express reference to attorneys’ fees.

A required hearing was held to approve attorneys fees

Justice Baisley approved the settlement terms and legal fees as presented, and Buttafuoco separately agreed to reduce the attorneys’ fee to $710,000.

The client sought new counsel (Newman)

In 2011, Ms. Urias sued Buttafuoco and Newman, claiming that Buttafuoco had deceived her and the trial court in the medical malpractice action about the legal fees they were entitled to by proffering an “illegal” and “improper” interpretation of section 474-a’s fee schedule. The complaint alleged, in essence, that although the trial court had approved the fees in question, it had not done so “knowingly,” and had instead “merely relied upon” Buttafuoco’s representation that section 474-a authorized this amount. The complaint also cursorily alleged that Buttafuoco had charged “improper, duplicative and illegal expenses and disbursements” against the settlement sum. In addition to the five causes of action based on these allegations (a violation of Judiciary Law § 487, breach of fiduciary duty, breach of a retainer agreement, conversion, and fraud), the complaint included a legal malpractice claim against both Buttafuoco and Newman.

The trial court dismissed on the grounds that the sole remedy was to seek vacatur of the judgment; the Appellate Division affirmed.

Here

Although a cause of action under section 487 lies, Buttafuoco is entitled to summary judgment on that claim. Viewing the facts in the light most favorable to the non-moving party, we conclude that Buttafuoco “established prima facie entitlement to judgment as a matter of law . . . by demonstrating that plaintiff[ ] failed to [sufficiently] allege that [he] engaged in deceit or collusion during the course of the underlying” medical malpractice action (Bill Birds, 35 NY3d at 179). In opposing summary judgment, “plaintiff[ ] failed to satisfy [her] burden to establish material, triable issues of fact” as to whether the defendants’ representations about their fee calculations or litigation expenses amounted to false statements (id.). Accordingly, we affirm the Appellate Division order appealed from insofar as it affirmed the dismissal of the first cause of action. 

Proof of deceit

In short, the record indicates that Buttafuoco’s calculations were supported by a legal argument that was not clearly foreclosed by existing precedent, and he was transparent with the tribunal about how he arrived at those calculations. Moreover, plaintiff has raised no material issue of fact as to whether Buttafuoco made false statements or representations in doing so—an essential element of alleging attorney deceit.

(Mike Frisch)