, , , ,

Matter of Koeppel, Summary Judgment Standards and Review of Attorney-Client Agreements

Read the entire opinion here.

Despite having a net worth of around $6 million, receiving dividends from Whitehouse Estates of $442,680 in August 2006 and borrowing at least $2,174,503 against his assets from May 2006 through August 2008 (and purchasing a Rolls Royce, albeit pre-owned, in the middle of September 2006), William never sought to disavow the Retainer on the ground of duress.

William’s affirmative defense that the 2006 Retainer is invalid as the product of duress is therefore dismissed.

In his affidavit in opposition, William alleges that the Firms’ hourly charges “have been and are being disputed” and that this “has been conveyed to Mr. Avedisian a number of times.” However, just when and what particular charges he was or is disputing, even at this late date, remain unspecified. Instead, William makes two general points regarding the invoices. First, without referring to any particular invoice, he sweepingly claims that Avedisian “overdoes [*14]things.” Second, he claims that there “were innumerable incidences where Mr. Avedisian would bill [him] for normal office, paralegal, and administrative time that Mr. Avedisian, because he had no secretary or paralegal, would do.” But he fails to specify even one of such “innumerable incidences”; nor does he specify when or how such an objection was made.[FN12] Such belated, conclusory and unsupported claims are insufficient to raise a question of fact on the issue of the accounts stated by the invoices sent to William by the Firms (Warshaw, Burstein, Cohen, Schlesinger & Kuh v Kessner, 214 AD2d 472 [1st Dept 1995]; Rosenman Colin Freund Lewis & Cohen v Neuman, 93 AD2d 745 [1st Dept 1983]). The Firms are therefore granted summary judgment on their claims of accounts stated for hourly litigation work.


William’s last remaining defense against the petition is that the Firms have breached their ethical and fiduciary duties to William by revealing in their papers on this motion his confidences as a client, to his embarrassment and injury. These allegations are also part of the fabric of his counterclaim to the effect that Avedisian drafted the settlement documents to benefit the attorneys to whom he was answerable; that Avedisian failed to advise him that he would owe $7 million in fees upon entering into the settlement; and that Avedisian failed to wind up the closing contemplated by the settlement. But such defense and counterclaim receive little attention in William’s motion papers. Nor does the record otherwise support either, on the facts or the law.

Simply put, William has failed to preserve his claims for trial by laying bare his proofs to show that the Firms disclosed client confidences that would not have been obtainable from outside sources. In any event, the Rules of Professional Conduct permit a lawyer to “reveal or use confidential information to the extent that the lawyer reasonably believes necessary . . . to defend the lawyer . . . against an accusation or wrongful conduct; or . . . to establish or collect a fee” (22 NYCRR Part 1200, Rule 1.6[b][5] [formerly DR 4-101(C)(4)]). In raising an economic duress claim, William placed his ability to pay for new counsel at issue, and the Firms were thus justified in demonstrating that William at all relevant times had significant net worth and that his liquidity problems were self-inflicted injuries incident to his high-wheeling lifestyle. There is thus no proscribed revelation of client confidences on which to rest William’s claimed defense to the contract.

Beyond merely conclusory statements, William has also failed to substantiate his claim [*15]that Avedisian drafted settlement documents to benefit the Firms and their members rather than him as client. In other words, William’s general sense of betrayal cannot serve as the basis for his breach of fiduciary duty claims.

Footnote 10:William’s bill of particulars describes the frequency of his protests as follows: “On or about once a week during the summer of 2007 and 2008, once a month almost every month from September through May for the years 2005 through 2008.” Avedisian points out that William thus claims to have disputed invoices for months in which no invoices were in fact sent to him for litigation work. On the other hand, Avedisian concedes that there was one occasion on which William did protest an invoice, which billed for work performed at a meeting among counsel in July 2006. Although that meeting had been called to discuss settlement, it appears to have focused instead on litigation issues, and Avedisian billed William accordingly as litigation time. Nevertheless, when William objected, Avedisian voided the charges and did not bill William for the time in question.

Footnote 11:William’s claim that the burden is on the Firms to show which invoices he was making partial payment on is supported by no authority or reasoning, and the court rejects it.