Hymowitz v. Nguyen

209 A.D.3d 997

177 N.Y.S.3d 143

Charles M. HYMOWITZ, et al., appellants,

v.Hoang Q. NGUYEN, etc., et al., respondents.

2019-11730

Index No. 519547/18

Supreme Court, Appellate Division, Second Department, New York.

Argued—May 9, 2022

October 26, 2022

Leonard B. Sukherman & Associates, P.C., Brooklyn, NY (Charles M. Hymowitz pro se, Michael Glidden, and Pollack, Pollack, Isaac and DeCicco, LLP [Brian J. Isaac], of counsel), for appellants.

Nguyen Leftt, P.C., New York, NY (Stephen D. Chakwin, Jr., of counsel), respondent pro se and for respondents Hoang Q. Nguyen and Andrew Derek Leftt.

HECTOR D. LASALLE, P.J., FRANCESCA E. CONNOLLY, LARA J. GENOVESI, WILLIAM G. FORD, JJ.

DECISION & ORDER

In an action, inter alia, to recover damages for breach of contract, the plaintiffs appeal from an order of the Supreme Court, Kings County (Kathy J. King, J.), dated September 27, 2019. The order granted the defendants’ motion pursuant to CPLR 3211(a) to dismiss the complaint.

ORDERED that the order is modified, on the law, by deleting the provisions thereof granting those branches of the defendants’ motion which were pursuant to CPLR 3211(a) to dismiss so much of the first, second, fifth, and sixth causes of action as were based upon an alleged agreement to pay the plaintiffs one-third of certain contingency fees, and to dismiss the thirteenth, fourteenth, seventeenth, eighteenth, nineteenth, twentieth, twenty-third, and twenty-fourth causes of action in their entirety, and substituting therefor provisions denying those branches of the motion; as so modified, the order is affirmed, without costs or disbursements.

According to the complaint, in 2008 the plaintiff Charles M. Hymowitz and the defendant Hoang Q. Nguyen, both of whom are attorneys, entered into an oral agreement whereby Hymowitz and his firm, the plaintiff Law Offices of Charles M. Hymowitz, P.C., would be retained by Nguyen in a "per diem" or "of counsel" capacity. The complaint alleges that the plaintiffs were to be compensated by being paid a per diem fee, and would further be paid one-third of any contingency fee collected by Nguyen on cases Hymowitz was assigned to work. In 2014, Nguyen and the defendant Andrew Derek Leftt entered practice together and founded the defendant law firm, Nguyen Leftt, P.C. (hereinafter the firm). According to the complaint, after the firm's founding, the plaintiffs continued to provide services in a per diem or of counsel capacity to the firm, and were offered the same compensation terms. In 2017, the relationship between the parties ended when, following the successful resolution of a matter in which Hymowitz served as "second chair" at trial, the defendants offered him compensation below what he believed he was entitled.

The plaintiffs commenced this action against the defendants alleging causes of action, inter alia, sounding in breach of contract, anticipatory breach of contract, quantum meruit, conversion, and violations of state and federal labor law. Prior to joining issue, the defendants moved pursuant to CPLR 3211(a) to dismiss the complaint, asserting that the action was barred by the doctrine of res judicata and for failure to state a cause of action. The plaintiffs opposed the motion, and by order dated September 27, 2019, the Supreme Court granted the motion on the ground that the action was barred by the doctrine of res judicata. The plaintiffs appeal.

"Under the doctrine of res judicata, a final adjudication of a claim on the merits precludes relitigation of that claim and all claims arising out of the same transaction or series of transactions by a party or those in privity with a party" ( 1155 Nobo Assoc., LLC v. New York Hosp. Med. Ctr. of Queens, 181 A.D.3d 937, 938, 119 N.Y.S.3d 897 [internal quotation marks omitted]). "The rule applies not only to claims actually litigated but also to claims that could have been raised in the prior litigation" ( Matter of Hunter, 4 N.Y.3d 260, 269, 794 N.Y.S.2d 286, 827 N.E.2d 269 ).

Here, in support of their motion the defendants submitted a petition interposed by the plaintiffs prior to the commencement of the action, in which the plaintiffs sought, among other things, pre-action disclosure of certain retainer statement numbers, and leave to file late retainer statements nunc pro tunc on cases at issue between the parties (see 22 NYCRR 691.20 [a][3]), seemingly in accordance with settled precedent that filing a retainer statement, or obtaining leave to file a late retainer statement nunc pro tunc, is a condition precedent to commencing an action alleging breach of contract in the context of an attorney fee-sharing dispute (see Siracusa v. Fitterman, 110 A.D.3d 1055, 1056, 974 N.Y.S.2d 498 ; Giano v. Ioannou, 78 A.D.3d 768, 771, 911 N.Y.S.2d 398 ). The defendants also submitted an order of the Supreme Court dated June 27, 2018, in which the court denied the pre-action disclosure requested in the petition on the ground that it did not have jurisdiction to grant that relief (see 22 NYCRR 691.20 [c][1]), and denied leave to file late retainer statements nunc pro tunc, inter alia, because the plaintiffs had not submitted evidence of any fee-sharing agreement between the parties.

However, the Supreme Court's determination in the June 27, 2018 order denying leave to file late retainer statements nunc pro tunc on the ground that the plaintiff had not submitted evidence of any fee-sharing agreement between the parties was not a final determination that no fee-sharing agreement between the parities existed (see Sweet Constructors, LLC v. Wallkill Med. Dev., LLC, 106 A.D.3d 810, 811, 965 N.Y.S.2d 145 ; Djoganopoulos v. Polkes, 67 A.D.3d 726, 727, 889 N.Y.S.2d 213 ). Moreover, the petition, in seeking pre-action disclosure, and pre-action nunc pro tunc relief for the purpose of preserving a breach of contract claim, did not provide an opportunity to litigate the other causes of action alleged in the complaint. Accordingly, the court erred in determining that the complaint was subject to dismissal on the ground that the action was barred by the doctrine of res judicata.

Nevertheless, the Supreme Court properly granted that branch of the motion which was pursuant to CPLR 3211(a)(7) to dismiss the complaint insofar as asserted against Leftt. "As a general rule, the law treats corporations as having an existence separate and distinct from that of their shareholders and, consequently, will not impose liability upon shareholders for the acts of the corporation" ( Doe v. Bloomberg L.P., 36 N.Y.3d 450, 461, 143 N.Y.S.3d 286, 167 N.E.3d 454, quoting Billy v. Consolidated Mach. Tool Corp., 51 N.Y.2d 152, 163, 432 N.Y.S.2d 879, 412 N.E.2d 934 ; see Superior Transcribing Serv., LLC v. Paul, 72 A.D.3d 675, 676, 898 N.Y.S.2d 234 ; cf. Business Corporation Law § 1505 ). "In order for a plaintiff to state a viable claim against a shareholder of a corporation in his or her individual capacity for actions purportedly taken on behalf of the corporation, [the] plaintiff must allege facts that, if proved, indicate that the shareholder exercised complete domination and control over the corporation and ‘abused the privilege of doing business in the corporate form to perpetrate a wrong or injustice’ " ( East Hampton Union Free School Dist. v. Sandpebble Bldrs., Inc., 16 N.Y.3d 775, 776, 919 N.Y.S.2d 496, 944 N.E.2d 1135, quoting Matter of Morris v. New York State Dept. of Taxation & Fin., 82 N.Y.2d 135, 142, 603 N.Y.S.2d 807, 623 N.E.2d 1157 ).

Here, while the complaint alleged that Leftt had authority to make decisions on behalf of the firm, and that Leftt "ratified" both that the plaintiffs held an "of counsel" position with the firm, as well as the compensation arrangement allegedly first entered into between the plaintiffs and Nguyen, the complaint does not allege that Leftt exercised "complete dominion and control over" the firm, or otherwise "abused the privilege of doing business in the corporate form" that would form the basis for personal liability (see East Hampton Union Free School Dist. v. Sandpebble Bldrs., Inc., 16 N.Y.3d at 776, 919 N.Y.S.2d 496, 944 N.E.2d 1135 ; Sky–Track Tech. Co. Ltd. v. HSS Dev., Inc., 167 A.D.3d 964, 965, 91 N.Y.S.3d 119 ).

The first and second causes of action alleged that Nguyen, and the fifth and sixth causes of action alleged that the firm, breached (1) an agreement to compensate the plaintiffs by paying them a per diem fee; and (2) an agreement to pay the plaintiffs one-third of any contingency fee collected by Nguyen on cases Hymowitz was assigned to work.

" ‘The essential elements of a cause of action to recover damages for breach of contract are the existence of a contract, the plaintiff's performance pursuant to the contract, the defendant's breach of its contractual obligations, and damages resulting from the breach’ " ( East Ramapo Cent. Sch. Dist. v. New York Schs. Ins. Reciprocal, 199 A.D.3d 881, 886, 158 N.Y.S.3d 173, quoting WMC Realty Corp. v. City of Yonkers, 193 A.D.3d 1018, 1021–1022, 148 N.Y.S.3d 161 ). "Generally, a party alleging a breach of contract must demonstrate the existence of a ... contract reflecting the terms and conditions of their ... purported agreement" ( Canzona v. Atanasio, 118 A.D.3d 837, 839, 989 N.Y.S.2d 44 [internal quotation marks omitted]; see Theaprin Pharms., Inc. v. Conway, 137 A.D.3d 1254, 1255, 29 N.Y.S.3d 401 ). Where the terms of an alleged oral agreement are vague or indefinite, they will not support a cause of action alleging breach of contract (see Reznick v. Bluegreen Resorts Mgt., Inc., 154 A.D.3d 891, 893, 62 N.Y.S.3d 460 ; Canzona v. Atanasio, 118 A.D.3d at 839, 989 N.Y.S.2d 44 ), though bearing in mind that " ‘the terms of a contract [do not] need [to] be fixed with absolute certainty to give rise to an enforceable agreement’ " ( LMEG Wireless, LLC v. Farro, 190 A.D.3d 716, 718, 140 N.Y.S.3d 593, quoting Kolchins v. Evolution Mkts., Inc., 31 N.Y.3d 100, 107, 73 N.Y.S.3d 519, 96 N.E.3d 784 [internal quotation marks...