Owner Sells Rundown Building to Sister’s Friend For $100

Seller Has Remorse and Sues Attorney For Malpractice

In March 20, 2017,  Michael Mamone sold a commercial building to Robert Buttiglione, a friend of Mamone’s sister, for $100.00 and attorneys fees. The contract of sale, the deed and the closing documents were all signed on March 20, 2017. That day the deed was given to Mamone’s attorney, Barbara Diehl, for recording. The deed was never recorded. When Buttiglione insisted Diehl record the deed she refused claiming her client, Mamone, had reconsidered and refused to consent to the recording of the deed.

Buttiglione then commenced an action for specific performance, breach of contract, and interference with a contractual relationship. Mamone’s answer asserted a counterclaim against Buttiglione for indemnification, and cross-claims against Diehl for legal malpractice and breach of a fiduciary duty. Diehl’s answer asserted a cross-claim against Mamone for indemnification and contribution.

In 2017 Mamone was interested in selling the  premises known as 26 North Highland Avenue in Ossining New York. He discussed the sale with one real estate broker and had another inspect the building. Mamone was concerned with the condition of the building and the safety of his tenants. He believed that repairing a structural “bulge,” refitting improper plumbing, laying a new sewer line and installing a sprinkler system would cost him more than the building was worth. In a March 2017 email he proposed giving the building to his church. On March 17, 2017, he discussed with Diehl the possibility of gifting the property.

The morning of March 20, 2017, Mamone called his sister “in a panic,” fearing for the safety of his tenants. As described by his sister, Mamone was “hysterical[ly] ranting,” talking nonstop for 20 minutes, fearing his building was about to collapse. She thought her brother was having a “complete mental breakdown.” She then telephoned Buttiglione, “a trusted friend,” who knew her brother and who had experience in building repairs, hoping he could talk “Michael off the ledge.”

Buttliglione called Mamone. During that 20 minute conversation Mamone agreed to sell the building to him for $100.00. Mamone called Diehl, who prepared the documents including a contract of sale, deed, and the necessary transfer papers. The closing occured at 3:00 p.m. that day. Mamone suggested contract provisions including responsibility for liens and the turnover of tenants’ security deposits. He made sure the contract provided the property was sold “as is.”

After the closing Mamone called his sister and with “palpable euphoria” said, “It’s all done. We did a closing. Buttiglione is such a great guy.” Mamone told Buttiglione to make sure he had insurance, and he cancelled his own insurance. Mamone forwarded the rent checks he received from tenants to Buttiglione and told friends he was glad to be rid of the building.

However, at some point Mamone reconsidered the sale and he directed Diehl not to record the deed. Litigation ensued.

Following the completion of discovery, Diehl moved for an order granting summary judgment on all causes of action asserted and cross-claims asserted against her. The complaint alleged three causes of action against Diehl: specific performance (to record the deed), breach of contract (an alleged contract between Buttiglione and Diehl to record the deed), and breach of contract (breach of the contract between Buttiglione and Mamone). Mamone’s answer included cross-claims against Diehl for legal malpractice and breach of fiduciary duty.

In a separate decision and order , the Court granted Buttiglione’s motion for summary judgment on the specific performance cause of action, and directed  Diehl and Mamone to deliver the deed and recording documents to him.  So, concomitantly, Diehl was not entitled to summary judgment on that cause of action.

Buttiglione claimed that he and Diehl had a contract whereby Diehl agreed to record the deed on his behalf, and breached that contract by failing to record the deed. Diehl established her entitlement to judgment as a matter of law on that cause of action by demonstrating she made no promise to Buttiglione and, even if a promise had been made, the promise was not supported by consideration. In opposition, Buttiglione failed to raise a triable issue of fact.

And Diehl established her entitlement to judgment as a matter of law by demonstrating she was not a party to the contract between Buttiglione and Mamone. In opposition, Buttiglione failed to raise a triable issue of fact.

Mamone claimed that but for the malpractice of Diehl he would not have sold the property for $100.00.

A plaintiff in an action alleging legal malpractice must prove that the attorney’s failure to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession proximately caused the plaintiff to sustain actual and ascertainable damages. An attorney’s conduct or inaction is the proximate cause of a plaintiff’s damages if, but for the attorney’s negligence, the plaintiff would have succeeded on the merits of the underlying action, or would not have sustained actual and ascertainable damages. It is a defendant’s burden, when it is the party moving for summary judgment, to demonstrate affirmatively the merits of a defense, which cannot be sustained by pointing out gaps in the plaintiff’s proof. Once a defendant makes a prima facie showing, the burden shifts to the plaintiff to raise a triable issue of fact.

Here, Diehl established as a matter of law that she did not commit legal malpractice in representing Mamone in the sale of his property to Buttiglione. The contract of sale and the deed were properly prepared at the request of Mamone. Diehl demonstrated there was nothing legally improper about the transaction.

In opposition, Mamone failed to raise a triable issue of fact. Mamone relied on the apparent inequity of the transaction to argue that Diehl should have either convinced him not to go forward or should have refused to represent him. However, in making such an argument Mamone ignored his own role in the transaction. In 2017 Momone became increasingly fearful for the safety of his tenants due to problems with the building, including structural issues in the attic and the need to replace plumbing and install a sewer hook-up and a sprinkler system. Mamone believed the cost of doing what was needed to make the building safe and code compliant would cost more than the building was worth. His belief that the building was unsafe and that repairs would cost more than the building’s value made Mamone anxious to rid himself of the property quickly. When Mamone first proposed giving the property away Diehl advised him to hire a broker to market the property and to hire an engineer to provide cost estimates for the required repairs and improvements. Mamone chose not to follow Diehl’s advice; and when Buttiglione offered to acquire the property, Mamone saw an opportunity to rid himself of the building which was causing him so much grief. Diehl agreed to represent him; the closing occurred; and Mamone was elated to have the building’s burden lifted from his shoulders. Only months later did Mamone reconsider.

Mamone argued that Diehl should have known that Mamone lacked the capacity to enter the contract. However, Mamone offered no evidence to support that thesis. Mamone submitted no medical records, no expert opinion, and no direct evidence to demonstrate he suffered from a mental illness making him incapable of understanding the transaction or making a rational judgment. The only “evidence” Mamone cited to support his claim of lack of capacity was his new found belief that he might not have received enough for the building. However, that did not show a lack of understanding or irrational judgment. Mamone submitted no evidence that his fear for his tenant’s safety was unfounded; and he submitted no evidence to refute his original assessment that required repairs exceeded the building’s value.

In sum, Diehl counselled Mamone to hire a broker and an engineer. Mamone disregarded the advice and insisted on moving forward with ridding himself of the property. Diehl believed Mamone genuinely feared for his tenants’ safety and for the prohibitive cost of repairs, and that, as a result, he fervently desired to sell the property for a nominal price to be relieved of that burden. She then represented him to help him achieve his goal. For months Mamone was happy with his decision. Mamone failed to produce any evidence which refuted Diehl’s belief that Mamone was adamant and genuine in his desire to sell the building at any cost.

As a general rule, where a cause of action alleging breach of contract or fraud arises from the same facts as a legal malpractice cause of action and does not allege distinct damages, the breach of contract or fraud cause of action must be dismissed as duplicative of the legal malpractice cause of action. Here, the cross-claims for legal malpractice and breach of fiduciary duty rely on the same facts, and no distinct damages are alleged. Thus, the cross-claim for breach of fiduciary duty was dismissed.

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