Commercial Litigation and Arbitration

Representing Adverse Party in Substantially Related Claim Is Actionable Breach of Fiduciary Duty Owed to Prior Client

From Kurman v. Schnapp, 73 A.D.3d 435 (1st Dept. 2010):

Plaintiff's breach of fiduciary duty cause of action is not duplicative of his legal malpractice cause of action, since it is premised on separate facts that support a different theory (see Ulico Cas. Co. v Wilson, Elser, Moskowitz, Edelman & Dicker, 56 AD3d 1, 9-10, 865 N.Y.S.2d 14 [2008]; Weil, Gotshal & Manges, LLP v Fashion Boutique of Short Hills, Inc., 10 AD3d 267, 271, 780 N.Y.S.2d 593 [2004]. As alleged, plaintiff's breach of fiduciary duty claim arose in December 2006, when defendant commenced his litigation activities against plaintiff in the Westchester County Supreme Court action, and continued through defendant's 2007 disqualification from representing the Queens Medallion Leasing Inc. defendants, and thereafter. In contrast, plaintiff's legal malpractice claim is based upon defendant's alleged 2005 and 2006 "communications with the TLC that may have left the impression that [defendant] was still representing [plaintiff] at that time." ***

[P]laintiff stated a cause of action for breach of fiduciary duty because an attorney is prohibited from representing parties whose interests are adverse to his or her former client in matters that are substantially related (see Solow v Grace & Co., 83 NY2d 303, 308, 632 N.E.2d 437, 610 N.Y.S.2d 128 [1994]; Greene v Greene, 47 NY2d 447, 453, 391 N.E.2d 1355, 418 N.Y.S.2d 379 [1979]).

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