N. A. Kerson Co., Inc. v. Shayne, Dachs, Weiss, Kolbrenner, Levy and Moe Levine

• Decision Date: 08 August 1977
• Citation: 397 N.Y.S.2d 142,59 A.D.2d 551
• Parties: N. A. KERSON COMPANY, INC., et al., Appellants-Respondents, v. SHAYNE, DACHS, WEISS, KOLBRENNER, LEVY AND MOE LEVINE, etc., et al., Respondents-Appellants.
• Court: New York Supreme Court — Appellate Division

Page 142

397 N.Y.S.2d 142

59 A.D.2d 551

N. A. KERSON COMPANY, INC., et al., Appellants-Respondents, v. SHAYNE, DACHS, WEISS, KOLBRENNER, LEVY AND MOE LEVINE, etc.,

et al., Respondents-Appellants.

Supreme Court, Appellate Division, Second Department.

Aug. 8, 1977.

Stephan A. Blum, New York City, for appellants-respondents.

Konheim, Halpern, Bleiwas & Greenberg, New York City (Samuel Halpern, New York City, of counsel), for respondents-appellants.

Before MARTUSCELLO, J. P., and MARGETT, O'CONNOR and SUOZZI, JJ.

MEMORANDUM BY THE COURT.

In an action inter alia to recover damages for legal malpractice, the parties cross-appeal from a money judgment of the Supreme Court, Kings County, entered February 3, 1976, which is in favor of plaintiffs and against defendants, upon a jury verdict.

Judgment reversed, on the law, with costs to defendants payable by plaintiffs, and complaint dismissed.

The record indicates that this action is merely a collateral means of attacking a stipulation of settlement which has already withstood direct attack (see Hannibal Investors Corp. v. Kerson Co., 34 A.D.2d 1107, 314 N.Y.S.2d 143). Plaintiffs cannot base an action in malpractice upon the alleged mistakes of counsel prior to settlement since their agreement to the terms of that settlement terminated the litigation (see Owens v. Lombardi, 41 A.D.2d 438, 343 N.Y.S.2d 978).

MARTUSCELLO, J. P., and MARGETT and O'CONNOR, JJ., concur.

SUOZZI, J., concurs in the result, with the following memorandum:

I concur in the result reached by the majority, which reverses the judgment in favor of plaintiffs Kerson in this action against defendants for legal malpractice and dismisses the complaint. However, I do so for reasons completely different from those stated by the majority.

A brief background of this case is in order.

The thrust of plaintiffs' (hereafter sometimes referred to as Kerson) complaint against defendants for legal malpractice is that on September 29, 1969 defendant Kaplan, an attorney associated with and employed by the remaining defendants to defend plaintiffs herein in a mortgage foreclosure action, improperly, and without the consent of the plaintiffs, entered into a stipulation with the attorney for the mortgagee in the foreclosure action whereby the second affirmative defense which had been part of Kerson's answer in the foreclosure action was withdrawn. That stipulation reads, in pertinent part, as follows:

"IT IS STIPULATED that the aggregate amount of principal unpaid on the three mortgages pleaded in the complaint is $21,853.47, with interest thereon at the rate of six per cent per annum from April 28, 1965 and that the second affirmative defense * * * of the answer of the defendants N. A. KERSON COMPANY, INC., NATHANIEL A. KERSON and RAY LILLIAN KERSON is accordingly withdrawn" (emphasis supplied).

The thrust of the Kersons' second affirmative defense in the foreclosure action was that pursuant to an agreement of April 28, 1965 Kerson had been paying certain rent moneys which had been applied to the mortgage indebtedness and that they were, therefore, not in default on the mortgage.

Thereafter, the mortgage foreclosure action proceeded to trial. In January, 1970, during the trial, the parties and their attorneys entered into a stipulation of settlement of the foreclosure action which was dictated on the record in open court in the presence of the Trial Justice there presiding. The plaintiffs herein were questioned by the Trial Justice and indicated that they...