ORDERED that the order is modified, on the law, by deleting the provision thereof granting those branches of the defendant's motion which were pursuant to CPLR 3211(a) to dismiss so much of the cause of action alleging breach of fiduciary duty as sought to recover compensatory damages and injunctive relief and the cause of action alleging legal malpractice, and substituting therefor a provision denying those branches of the motion; as so modified, the order is affirmed, without costs or disbursements.
In 2018, the plaintiff commenced an action (hereinafter the 2018 action) against the defendant to recover damages for legal malpractice and breach of fiduciary duty as a result of the defendant's representation of the plaintiff in an underlying matrimonial action against his wife. According to the complaint in the 2018 action, approximately one month after the note of issue was filed in the underlying matrimonial action, the plaintiff terminated the defendant's services, retained another law firm, and settled the underlying matrimonial action. The defendant moved pursuant to CPLR 3211(a)(7) to dismiss the complaint in the 2018 action. In an order dated December 31, 2018, the Supreme Court granted the defendant's motion. On appeal, this Court affirmed, determining that the complaint in the 2018 action failed to state a cause of action alleging legal malpractice and that the cause of action alleging breach of fiduciary duty, as pleaded, was duplicative of the legal malpractice cause of action (see Katsoris v Bodnar & Milone, LLP, 186 AD3d 1504, 1505-1507).
In December 2020, the plaintiff commenced this action against the defendant, asserting causes of action alleging breach of fiduciary duty and legal malpractice. The defendant moved pursuant to CPLR 3211(a) to dismiss the complaint, contending that the causes of action were barred by the doctrines of res judicata and collateral estoppel and that the complaint failed to state a cause of action. In an order dated June 30, 2021, the Supreme Court granted the defendant's motion. The plaintiff appeals.
"Pursuant to CPLR 3211(a)(5), a party may seek dismissal of a cause of action based upon the doctrine of res judicata"
(Abakporo v Abakporo, 244 AD3d 665, 666; see Sunny v Hossain, 236 AD3d 699, 700). "Under res judicata, or claim preclusion, a valid final judgment bars future actions between the same parties on the same cause of action" (Yu Chan Li v City of New York, 240 AD3d 832, 834 [internal quotation marks omitted]; see Sunny v Hossain, 236 AD3d at 700). However, "'[w]here a dismissal does not involve a determination on the merits, the doctrine of res judicata does not apply'" (Blooming Home Realty, LLC v Infinity Holdings Northeast, LLC, 228 AD3d 815, 817, quoting 1155 Nobo Assoc., LLC v New York Hosp. Med. Ctr. of Queens, 181 AD3d 937, 938). "As a general rule, a dismissal for failure to state a cause of action is not on the merits and, thus, will not be given res judicata effect" (id. [internal quotation marks omitted]). "Such a dismissal pursuant to CPLR 3211(a)(7) has preclusive effect only as to a new complaint for the same
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cause of action which fails to correct the defect or supply the omission determined to exist in the earlier complaint" (id. [internal quotation marks omitted]; see Ward v Klein, 203 AD3d 1217, 1218).
"The doctrine of collateral estoppel, a narrower species of res judicata, precludes a party from relitigating in a subsequent action or proceeding an issue clearly raised in a prior action or proceeding and decided against that party or those in privity, whether or not the tribunals or causes of action are the same" (Hossain v Hossain, 243 AD3d 894, 895 [internal quotation marks omitted]; see Domingo v Avis Budget Group, Inc., 219 AD3d 964, 965). "The doctrine of collateral estoppel applies when: (1) the issues in both proceedings are identical, (2) the issue in the prior proceeding was actually litigated and decided, (3) there was a full and fair opportunity to litigate in the prior proceeding, and (4) the issue previously litigated was necessary to support a valid and final judgment on the merits" (Hossain v Hossain,
243 AD3d at 895-896 [internal quotation marks omitted]; see Berardini v Blossom Nails Too Corp., 241 AD3d 1252, 1253). "The party seeking to invoke collateral estoppel has the burden to show the identity of the issues, while the party trying to avoid application of the doctrine must establish the lack of a full and fair opportunity to litigate" (Hossain v Hossain, 243 AD3d at 896 [internal quotation marks omitted]; see Berardini v Blossom Nails Too Corp., 241 AD3d at
1253).
Here, the defendant failed to establish the elements necessary for the doctrines of res judicata and collateral estoppel to apply (see Blooming Home Realty, LLC v Infinity Holdings Northeast, LLC, 228 AD3d at 817). Contrary to the defendant's contention, the dismissal of the complaint in the 2018 action was not a final judgment on the merits (see Shahid v Legal Aid Socy., 173 AD3d 1099, 1101), and the issues raised in the complaint in this action were not necessarily decided in the 2018 action (see Blooming Home Realty, LLC v Infinity Holdings Northeast, LLC, 228 AD3d at 817). Moreover, the complaint in this action corrected the relevant omissions in the complaint in the 2018 action (see id.). Accordingly, the Supreme Court should have denied dismissal of the complaint pursuant to CPLR 3211(a)(5).
"To state a cause of action to recover damages for legal malpractice, a plaintiff must allege: (1) that the attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession; and
(2) that the attorney's breach of the duty proximately caused the plaintiff actual and ascertainable damages" (Campbell v Law Off. of Solomon Rosengarten, 241 AD3d 771, 772 [internal quotation marks omitted]; see Howlader v Aranow Law, P.C., 242 AD3d 841, 841). Conclusory allegations of damages or injuries predicated on speculation cannot suffice for a malpractice action, and dismissal is warranted where the allegations in the complaint are merely conclusory and speculative (Floral Park Ophthalmology, P.C. v Ruskin Moscou Faltischek, LLP, 216 AD3d 1136, 1137 [internal quotation marks omitted]). "To establish causation, the plaintiff must also show that he or she would have prevailed in the underlying action or would not have incurred any damages but for the attorney's negligence" (Stinnett v Derek Smith Law Group, PLLC, 241 AD3d 737, 738; see Floral Park Ophthalmology, P.C. v Ruskin Moscou Faltischek, LLP,
216 AD3d at 1137). Moreover, "[a] legal malpractice cause of action is viable, despite settlement of the underlying action, if it is alleged that settlement of the action was effectively compelled by the mistakes of counsel" (Valentina v Beckerman, 241 AD3d 751, 753 [internal quotation marks omitted]; see Floral Park Ophthalmology, P.C. v Ruskin Moscou Faltischek, LLP, 216 AD3d at 1137).
Here, accepting the facts alleged in the complaint as true, and according the plaintiff the benefit of every possible favorable inference, the complaint sufficiently stated a cause of action to recover damages for legal malpractice (see Postiglione v Sacks & Sacks, LLP, 233 AD3d 719, 721; Kowalski v Gold Benes, LLP, 232 AD3d 869, 871). The complaint alleged that the defendant failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession by, inter alia, failing to provide proper financial advice regarding postcommencement spending, obtain necessary discovery, and designate a needed expert.
"'The elements of a cause of action to recover damages for breach of fiduciary duty are (1) the existence of a fiduciary relationship, (2) misconduct by the defendant, and (3) damages directly caused by the defendant's misconduct'" (South Shore Eye Care, LLP v Lane, 242 AD3d 792, 796 [internal quotation marks omitted], quoting 88-18 Tropical Restaurante Corp. v Utica First Ins. Co., 223 AD3d 772, 774). "The elements must be pleaded with particularity pursuant to CPLR 3016(b)" (id.). "The relationship of client and attorney is one of 'unique fiduciary reliance' which imposes on the attorney '[t]he duty to deal fairly, honestly and with undivided loyalty . . . including maintaining confidentiality, avoiding conflicts of interest, operating competently, safeguarding client property and honoring the clients' interests over the lawyer's'" (Saint Annes Dev. Co. v Batista, 165 AD3d 997, 997-998, quoting Matter of Cooperman, 83 NY2d 465, 472). "Thus, any act of disloyalty by counsel will . . . comprise a breach of the fiduciary duty owed to the client" (id. at 998 [internal quotation marks omitted]; see Ulico Cas. Co. v Wilson, Elser, Moskowitz, Edelman & Dicker, 56 AD3d 1, 9). "Although an action to recover damages for breach of fiduciary duty normally requires a lower standard of causation, in the context of an action asserting attorney liability, the claims of legal malpractice and breach of fiduciary duty are governed by the same standard of but for causation" (Lambro Indus., Inc. v Gilbert, 233 AD3d 765, 767 [alterations and internal quotation marks omitted]; see Boone v Bender, 74 AD3d 1111,
1113).
Contrary to the defendant's contention, the breach of fiduciary duty cause of action was based upon, among other things, the defendant's alleged conduct of charging the plaintiff unnecessary and excessive fees, which was not duplicative of the legal malpractice cause of action (see Lauder v Goldhamer, 122 AD3d 908, 910). Accordingly, contrary to the Supreme Court's determination, the complaint sufficiently alleged a cause of action sounding in breach of fiduciary duty, and the court should have denied dismissal of that cause of action pursuant to CPLR 3211(a)(7). However, with respect to the cause of action alleging breach of fiduciary duty, the complaint failed to allege any conduct on the part of the defendant that rose to the high level of moral culpability or constituted willful or wanton negligence or recklessness, as is necessary to support a claim for punitive damages (see Hall v Hobbick, 192 AD3d 776,
778). Accordingly, the Supreme Court properly granted dismissal of so much of the cause of action alleging breach of fiduciary duty as sought to recover punitive damages.
The parties' remaining contentions are without merit.
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