Delson & Gordon v. Bayer

Order, Supreme Court, New York County (Martin Schoenfeld, J.), entered on or about June 8, 1995, which denied defendants’ motion for summary judgment on their counterclaims for legal malpractice, unanimously affirmed, without costs. Defendants failed to establish as a matter of law either that plaintiff law firm was negligent in jointly representing them, or that "but for” any such negligence, defendant Dr. Bayer would not have been held financially liable in the underlying Federal action (see, Kaufman & Kaufman v Hoff, 213 AD2d 197, 198). The parties’ sworn affidavits dispute whether plaintiff fully disclosed the possible effects of jointly represent 447 ing two individuals with different interests and whether defendants consented to joint representation. Moreover, although Dr. Bayer has insisted that her involvement with the day to day business of the corporation run by her husband was virtually nonexistent, she was a signatory to a "memorandum of understanding” that pledged her interest in her Manhattan co-operative apartment as partial collateral for the extension of a line of credit to the corporation; it was alleged in the underlying action that about $154,000 in misappropriated funds were later used as consideration for releasing her from her commitment. Thus, as the IAS Court suggested, her involvement in corporate affairs may have been more extensive than the record so far indicates. Concur—Ellerin, J. P., Kupferman, Ross, Williams and Tom, JJ.