FKB's A. Michael Furman and Bain R. Loucks win an appeal in the Appellate Division, First Department dismissing LPL claim against a matrimonial attorney arising from the former client's incarceration due to a violation of a Court Order. 4/1/11

FKB's client, a seasoned divorce attorney, was retained to represent the plaintiff in a hotly contested divorce proceeding. Three months prior to retaining FKB's attorney, plaintiff, represented by prior counsel, was ordered to turn over custodial accounts to her husband. The Order was modified several times and on August 31, 2005, plaintiff was ordered to immediately transfer the custodial accounts to her husband's attorneys. The Order also stated that, "Plaintiff's failure to do so within three (3) business days shall be deemed contempt and plaintiff hereby waives any further notice requirements with respect to being held in contempt."

Despite the multiple orders issued, plaintiff refused to transfer the custodial accounts, and on December 21, 2005, approximately nine (9) months after plaintiff was originally ordered to transfer the custodial accounts, plaintiff's husband's counsel obtained an order holding plaintiff in contempt and directing the parties to appear on December 23, 2005 for a contempt hearing.

At the contempt hearing, the Court heard arguments as to whether it should impose a penalty on plaintiff for her failure to comply with multiple court orders. On multiple occasions, FKB's client requested that the Court allow plaintiff additional time to comply with the Order. The Court rejected the requests and stated that a penalty was necessary because plaintiff had openly and continuously ignored court orders. The Court stated that, "in light of the counsel provided to you by your various attorneys, despite the number of conferences we've had in this court, despite the number of orders I've issued the funds still have not been transferred." The Court ordered plaintiff's incarceration over the Christmas holiday until January 6, 2006 or until such time as the custodial accounts were transferred. Plaintiff was released after the funds were transferred on December 28, 2005. The attorney-client relationship concluded shortly thereafter, and plaintiff retained successor counsel.

On the eve of the expiration of the statute of limitations, plaintiff commenced an action against FKB's client claiming that she incurred damages as a result of alleged failure to conduct discovery, modify the pendente lite award and the incarceration. In lieu of answering the Complaint, FKB filed a motion to dismiss pursuant to CPLR §3211(1), (a)(5) and (a)(7). Relying on documentary evidence, FKB argued that plaintiff's incarceration was caused by her own recalcitrance in willfully disregarding the Court's order. In addition, FKB argued that any alleged discovery deficiencies could have been remedied by plaintiff's successor counsel. Finally, FKB argued that plaintiff's claim that her attorney failed to modify the pendente lite award was speculative. The Hon. Justice Jane S. Solomon, J.S.C. (New York County) agreed and issued an Order dated December 7, 2009 granting the motion to dismiss. Plaintiff appealed.

On March 24, 2011 the Appellate Division, First Department issued a unanimous decision affirming Justice Solomon's decision. The Appellate Division held that, "plaintiff – not her attorneys – was the proximate cause of her contempt adjudication and the resulting incarceration." The Court pointed out that plaintiff had been advised on multiple occasions that compliance with the Court's order was required. The Court also held that successor counsel could have remedied any alleged discovery deficiencies that plaintiff attributed to her attorney. Finally the Court held that plaintiff's claim for failure to modify the pendente lite award was speculative and had "limited prospects of success."

Bain R. Loucks drafted the appellate papers. The appeal was argued by A. Michael Furman. This case has been reported at 2011 WL 1045764 and on www.law.com by clicking here.

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