Professional Liability Matters

May 13, 2019 Agents and Brokers / Real Estate Professionals

Escrow Agent Responsibilities: Robot or Rogue?

Real estate transactions occur all the time whether in the residential or commercial context. Notwithstanding a familial transfer, the arms-length transaction includes a buyer, a seller, and sometimes a bank or private money-lender who finances the deal. In some of those situations, there is also an escrow agent whose role is simply identified in the contract to be the “holder of the funds” while certain conditions are met post-contract. The escrow agent often keeps a fee for the services rendered, and becomes a mechanism for …

May 6, 2019 Employment Practices Liability

Ambiguity in Arb. Agreement Cannot Be Construed as Consent to Class Arbitration

In Lamps Plus, Inc. v. Varela, the U.S. Supreme Court held that an ambiguous arbitration agreement cannot provide the necessary contractual basis for compelling class arbitration under the Federal Arbitration Act. This decision reverses the Ninth Circuit’s decision that permitted an employee’s data breach class arbitration to proceed.

Lamps Plus built on the Supreme Court’s 2010 decision in Stolt-Nielsen S. A. et al. v. Animalfeeds International Corp, in which the Supreme Court ruled that an arbitration agreement, silent on the issue of class arbitration, was …

April 22, 2019 Long Term Care

NY Nursing Home Litigation: Double Recovery?

An alarming trend has emerged among the plaintiff’s bar in Long-Term Care litigation. Plaintiffs are alleging a right to recovery for death, or other injuries, under both the negligence/wrongful death standards (i.e. pain and suffering and pecuniary loss), and the Public Health Law (§2801-d). Historically, when there is a death resulting from negligence, the recovery is limited to pecuniary loss, but, now the plaintiff’s bar is arguing that when an elderly person who was a resident of a nursing home dies, as a result of …

April 15, 2019 Defenses

Third Circuit Reaffirms Heightened Securities Fraud Standard

One of the most difficult aspects of defending investor misrepresentation claims is that they naturally occur after a financial calamity. In retrospect, there is almost always an argument that a statement here, or omission there, was “misleading” in light of the company’s ultimate fate. It is for this very reason that common law imposes a heightened standard for investors attempting to bring such a claim for what is essentially statutory fraud. In a recent decision from the Third Circuit, the Court reiterated this heightened pleading …

April 8, 2019 Agents and Brokers

Duty to Read Defense

While the vast majority of states hold that an insurance broker cannot be absolutely shielded from his negligence in procuring coverage to the extent the insured failed to read the policy, there are still a few states where the “duty to read” can provide an absolute defense. One of those states is Mississippi. In a recent decision issued by the U.S. District Court for the Northern District of Mississippi, this rule was applied in a decision dismissing the case from federal district court based on …

April 2, 2019 Employment Practices Liability

The Importance of Employment Job Descriptions

Employment job descriptions serve many purposes: to attract talented applicants, to inform employees of expectations. In addition, job descriptions are often critical in disputes between employers and employees. A federal appellate court recently ruled on a case where the words in job description helped bolster the employer’s defense.

The case involved a correctional officer who was injured during an altercation with an inmate. The injury required shoulder surgery and resulted in the employee returning to work in a light duty capacity. Thereafter the correctional officer …

March 25, 2019 Defenses

NJ Considering Bill to Shorten Malpractice Statute of Limitations

A measure that would shorten the statute of limitations for New Jersey malpractice claims against certain licensed professionals, including attorneys, from six years to two years, passed the Assembly Judiciary Committee on March 18 in Trenton. Although a small step, this is encouraging for many New Jersey professionals, and the attorneys who defend them.

Under A-4880, malpractice suits against licensed accountants, architects, engineers and land surveyors would also have to be filed within two years, and attorney fees could not be awarded in any action …

March 19, 2019 General

South Carolina High Court Allows Malpractice Claim by Insurer Against its Assigned Defense Counsel

Early March, in a narrow, carefully worded opinion, a divided Supreme Court of South Carolina ruled that a liability insurer may sue an attorney it retained to defend its insured where the attorney’s breach of its duty to the insured proximately causes the insurer damage. The decision adds South Carolina to the growing list of states that recognize a malpractice cause of action by an insurer against its assigned defense counsel. See Sentry Insurance Co. v. Maybank Law Firm, LLC, — S.E.2d —, 2019 WL 1119977, at …

March 18, 2019 Design Professionals (A&E)

NY Considers Limiting Claims Against Design Professionals

The New York Legislature is considering whether to enact a statute of repose that would limit the time for filing a claim against builders and design professionals for construction defects. Assembly Bill A3595 would repeal Civil Practice Law & Rules (CPLR) § 214-d in its current form and reenact § 214-d to codify a statute of repose similar to a significant majority of states.

If passed into law, Assembly Bill A3595 would provide for a 10-year statute of limitations for wrongful death, personal injury, and …

March 11, 2019 Engagement Letters / Risk Management

Limiting Malpractice through Scope of Engagement

A recent NY Appellate Division decision serves as another reminder of the importance of carefully defining the scope of engagement in an engagement letter. This is because, under New York law, an attorney may not be held liable for failing to act outside the scope of their retainer.

In Attallah v. Milbank, Tweed, Hadley & McCloy, LLP, 168 A.D.3d 1026 (App. Div. 2d Dep’t 2019) a client brought an action against a law firm alleging legal malpractice in a case where the client had …