Nilzara, Inc. v Karakus Inc NY Slip Op 30461(U) March 31, 2015 Supreme Court, Kings County Docket Number: 1181/2013 Judge: David I.
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1 Nilzara, nc. v Karakus nc NY Slip Op 30461(U) March 31, 2015 Supreme Court, Kings County Docket Number: 1181/2013 Judge: David. Schmidt Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various state and local government websites. These include the New York State Unified Court System's E-Courts Service, and the Bronx County Clerk's office. This opinion is uncorrected and not selected for official publication.
2 [* FLED: 1] KNGS COUNTY CLERK 03/31/ :26 PM NDEX NO /2013 NYSCEF DOC. NO. 52 RECEVED NYSCEF: 03/31/2015 At an las Term, Part COM-2 of the Supreme Court of the State of New York, held in and for the County of Kings, at the Courthouse, at Civic Center, Brooklyn, New York, on the 26 TH day of March, PRESENT: HON. DA VD. SCHMDT, Justice. NJLZARA, NC, DECSON AND ORDER --against-- Plaintiff, ndex No. 1181/2013 Mot. Seq. No(s). 3 & 4 KARAKUS NC., KEVN KARAKUS, NELLE LEVTS alk/a NELLY LEVTS and ERK KHLOV Defendants. NELLE LEVTS a/k/a NELLY LEVTS --against- ERK KHLOV, ESQ., Third Party Plaintiff, Third Party Defendant.._g~_K~gQ~!ggJ?_~-E~!~_!~_~~_g~!~_t!!: L ~_Y.~f~~--~-~ --~-: Notice of Motion/Cross Motion, Affidavits (Affirmations), and Memoranda of Law Annexed!, t _g J2Q~!gK~f!!~~~~_!~J~ffl~~!i~~~2_!\~!!~~~~ L ~_1:~_~.? i~_~~~~ 1_~ ~_~ y._~f!!~~~~!~_-(~f!!~~!~-~~~2-~g~-~~~~ l ~g:~-~~-i~-~-?-q---- Memoranda of Law j 28,47 Upon the foregoing papers, motion sequence numbers 3 and 4 are consolidated for disposition. Plaintiff NLZARA, NC ("Nilzara") commenced the instant action seeking
3 [* 2] to recover damages ;istemming from a sales tax lien that accrued subsequent to its purchase il of a restaurant from defendant KARAKUS NC., an entity owned by defendant KEVN ' KARAKUS. Defe*dant/Third Party Plaintiff NELLE LEVTS ("Levitis") represented il Nilzara as the purchaser and third party defendant ERK KHLOV represented the seller Karakus nc. Nilzar.a's complaint alleges, among other things, a claim forlegal malpractice ~ " against Levitis based on the alleged failure to timely file a "Notification of Sale, Transfer,, '! or Assignment ofb\lk" with the New York State Department of Taxation and Finance and for the alleged failj,re to maintain the proper escrow of the sale proceeds to ensure that funds were available in the event the seller had unpaid sales tax liabilities. Levitis commenced a third party action against khilov sounding in common law indemnification ' :~ and contribution pr~mised on the allegations that khilov assumed responsibility for filing il, the proper tax docvments by preparing said documents and identifying himself as the!! escrow agent on the untimely filed form. Levitis claims that khilov is the true tortfeasor ~ by virtue of his pre~ature release of the sale proceeds to his client from escrow. Nilzara :~ now moves for surnmary judgment on its legal malpractice claim against Levitis and,i " khilov moves to di~miss the third party complaint in its entirety. :~ "n order to prevail in an action to recover damages for legal malpractice, a plaintiff 'i must establish that the, defendant attorney failed to exercise the ordinary reasonable skill! and knowledge corrimonly possessed by a member of the legal profession, and that the :1 breach of this duty~proximately caused the plaintiff to sustain actual and ascertainable damage. To establish causation, a plaintiff must show that he or she would have prevailed ' 2
4 [* 3] in the underlying action or would not have incurred any damages but for the attorney's negligence." (Smith v. Kaplan Belsky Ross Bartell, LLP, --- NYS3d ----,2015 WL [2nd Dept. 2015] citing Rudolfv. Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442 [2007][internal citations omitted]). Here, Nilzara has established as a matter of law that it was repre~ented by Levitis with respect to the sale of the restaurant and that Levitis failed to ensure' compliance with the provisions of Tax Law ~ 1141 (c). Thus plaintiff is entitled to summary judgment to the liability portion of its claim. However, Nilzara has not established,,j. as its damages as a i: matter of law. The sale of the property occurred on or about February 16, At or ' + about the same as the closing, the purchaser allegedly executed and filed the "Notification i! of Sale, Transfer, or Assignment of Bulk" with the New York State Department of Taxation and Finance. Thereafter, in December of 2010, the New York State Department of Taxation and Finance issued a warrant assessing $ 83, as the amount of sales tax due and owing, inclusive of penalties and interest. The record before this court does not indicate what if any portion of the assessment is still due and owing by plaintiff nor does it indicate what if any actions were taken in between plaintiffs issuance of the Notification of Sale, Transfer, or Assignment of Bulk and the issuance of the New York State Department of Tax~tion and Finance warrant. Therefore, as to plaintiffs damages there remains issues of fact with respect to Levitis' affirmative defenses of culpable conduct and! the failure to mitigate. There also remains an issue of fact as to which party would be responsible for the interest allegedly accruing on the base amount of the sales tax allegedly due and owing. 3
5 [* 4] The motion by third party defendant khilov seeking to dismiss the third party complaint is denied. When considering a CPLR 3211(a)(7) motion to dismiss, a court should afford a plaintiffs complaint the benefit of a liberal construction and presume that all facts alleged therein are true. n determining the motion the plaintiff is to be afforded i the benefit of every favorable inference, and the court should decide if the facts as alleged fit within any cognizable legal theory (see Leon v. Martinez, 84 NY2d 83 [1994]; Hecht v. Andover Associates Management Corp., 114 AD3d 638 [2nd Dept. 2014]). n addition, in determining a motion made pursuant to CPLR 3211(a)(7), a court may freely consider affidavits submitted by the plaintiff to remedy any defects in the complaint (see Rovello v. Orofino Realty Co., 40 NY2d 633 [1976]) and, upon consideration of said affidavits "the criterion is whether the proponent of the pleading has a cause of action, not whether he has stated one" (Guggenheimer v. Ginzburg, 43 NY2d 268,275 [1977]). i' Here, Levitis has a cognizable claim for damages stemminj from khilov's involvement with the failure to comply with Tax Law S 1141 (c). The gravaman of Levit is' claim is that khilov assumed responsibility for the filing of the Notification of Sale,, Transfer, or Assignment of Bulk and for the responsibility of maintaining an escrow of the sale proceeds to ensure compliance with the Tax Law. Although khilov denies that he was to act as an escrow agent he does not provide any explanation as to why he was expressly designated as the escrow agent on the Notification of Sale, Transfer, or Assignment of Bulk document. Thus, based on the allegations in the third party complaint,!: the affidavit of Levitis and the documentary evidence presented with the motions, Levitis 4
6 [* 5] ~, states a cognizable?laim against khilov for damages relating to the duties he assumed in ~ the course of the tra~saction. i Therefore, meotion sequence number 3 is granted and motion sequence number 4 is " :1 denied. This constitutes the Decision and Order of the Court. :; ENTER, J. S. C. -.DN'OLsa-uot 5
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