Leon v. Martinez

193 A.D.2d 788, 598 N.Y.S.2d 274, 1993 N.Y. App. Div. LEXIS 5234

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: May 24, 1993
• Status: Published

Opinions

In an action to recover damages for breach of contract, the plaintiffs appeal from so much of an order of the Supreme Court, Kings County (Dowd, J.), dated December 12, 1990, as granted the motion of the defendants Pearlman, Apat & Futterman, and Ira A. Futterman to dismiss the complaint insofar as it is asserted against them.

Ordered that the order is reversed insofar as appealed from, on the law, with costs, and the motion is denied.

As a result of a job-related accident, the defendant Wilfredo Martinez was rendered a quadriplegic. After the accident, Martinez received care from the plaintiffs Maria Macia, Xavier Leon, and Gina Leon, with whom he resided. According to the plaintiffs, they fed Martinez, clothed him, bathed him, transported him to and from hospitals and doctors, and provided care and attention 24 hours a day. Allegedly upon the recommendation of the plaintiffs, Martinez retained the defendant Ira H. Futterman of the defendant law firm of Pearlman, Apat & Futterman (hereinafter the law firm) to handle his personal injury action. The defendant attorneys had previously prepared legal documents for the plaintiffs, including drafting wills.

On May 12, 1983, Martinez executed a document, drafted by Futterman, that stated “because of [the plaintiffs’] care, services, help, assistance and benefit to [Martinez] from the time of [his] illness to the present date”, he gave to each of the plaintiffs a stated percentage “of any recovery [he] may get” from the personal injury action. After the personal injury action was settled, however, Futterman remitted the entire proceeds to Martinez, who refused to pay the plaintiffs a portion of the settlement. The plaintiffs subsequently commenced this action to recover the money allegedly owed them pursuant to the agreement.

Futterman and the law firm moved to dismiss the complaint insofar as it is asserted against them pursuant to CPLR 3211, arguing that they did not represent the plaintiffs and never agreed to disburse the funds to them, or to act as an escrow agent. The court granted the motion, reasoning that “[t]he preparation of an agreement by Martinez’ attorneys does not create a liability on their part for his alleged failure to honor it”. We reverse.

Where attorneys have notice of an assignment or a portion of their client’s claim for personal injuries and pay out money in disregard of the assignment, they may be liable to the assignees (see, Brinkman v Moskowitz, 38 Misc 2d 950; see also, Contintental Purch. Co. v Van Raalte Co., 251 App Div 151; Healy v Brotman, 96 Misc 2d 386, 392; Matter of Neilson Realty Corp. v MVAIC, 47 Misc 2d 260, 264; Aiello v Levine, 44 Misc 2d 1067; cf., Matter of Kelly, 23 NY2d 368, 382). In the instant case, the plaintiffs have alleged that the defendant attorneys distributed proceeds in disregard of an assignment which Futterman drafted and which was executed in his presence. Indeed, the agreement contains Futterman’s signature as the notary. According to the plaintiffs, the assignment was discussed fully among all the parties at the time of its execution. The plaintiffs also alleged that they attempted to speak to Futterman after the underlying negligence action was settled, but Futterman avoided them. Whether or not the plaintiffs ultimately will prevail on this claim, the pleadings in the complaint, as amplified by the affidavits, are certainly sufficient to withstand a motion to dismiss. Lawrence, O’Brien and Copertino, JJ., concur.