Legal Malpractice

Relation Back Doctrine and Legal Malpractice

By (Andrew Lavoott Bluestone)

Attorneys frequently use LLPs or PCs as their corporate identity.  Does this really make a difference in small or single attorney settings?  The short answer is: "yes!"  in Teodorescu v Resnick & Binder, P.C. ;2010 NY Slip Op 20400 ;Decided on September 28, 2010 ;Supreme Court, Kings County ;Kurtz, J. we see what happens when plaintiff fails to name the individual attorneys,
 

"During the approximately two years this action was stayed, the attorneys who formed the defendant professional corporation, David Joseph Resnick and Serge Yakov Binder (hereinafter "Resnick" and "Binder"), were both disbarred. Plaintiff now moves to have the stay vacated and this action placed on the trial calendar and for leave to amend the summons and complaint to add Resnick and Binder as individual defendants pursuant to CPLR §203(b), since the statute of limitations as to these defendants has already expired. 

A plaintiff seeking the benefit of the relation-back doctrine must establish the existence of a mistake concerning the defendant's identity that prevented plaintiff from serving that defendant before the statute of limitations expired. See Bryant v. South Nassau Communities Hosp., 59 AD3d 655, 656 (2d Dept 2009). Evaluation of an alleged mistake then turns on whether the mistake interfered with plaintiff's ability to name all of the proper defendants prior to expiration of the limitation period. Compare Monir v. Khandakar, 30 AD3d at 489, supra (finding plaintiff's failure to add a professional corporation to her medical malpractice claims against the defendant dentist to be a mistake based upon her lack of knowledge as to the corporation's existence) with Contos v. Mahoney, 36 AD3d 646, 647 (2d Dept 2007) (declining to apply the relation-back doctrine where plaintiff failed to sue the defendant lessor in a timely manner, despite receiving a copy of a Lease Termination Statement identifying Nissan as the [*3]lessor prior to the expiration of the limitation period.) Under these guidelines, when a plaintiff is aware of the defendants' potential liability and deliberately decides not to assert a claim against them, there is no mistake and thus no relation-back. See Buran v. Coupal, 87 NY2d at 181, supra. Under such circumstances, a "plaintiff should not be given a second opportunity to assert that claim after the limitations period has expired (citations omitted)." Id. The Court concludes that in order for plaintiff to receive the benefit of the relation-back doctrine, all three prongs enunciated in Brock, as modified by the Court of Appeals in Buran, must be satisfied.

The Court finds that plaintiff has failed, however, to satisfy the third prong under the Brock test because plaintiff knew of the proposed defendants' potential liability at the time she filed a legal malpractice action against defendant.   Finally, since the relation-back doctrine as a whole hinges on the sufficiency of notice to the proposed new defendants within the statutory limitations period, the correct inquiry is not whether Resnick and Binder were aware of the charges brought by plaintiff against defendant, but whether such knowledge could reasonably have led them to the conclusion that they were intentionally omitted as parties to the action and were, thus, no longer at risk of litigation. "

Full post as published by New York Attorney Malpractice Blog on October 21, 2010 (boomark / email).