`NYSCEF DOC. NO. 43
`
`INDEX NO. 63036/2012
`
`RECEIVED NYSCEF: 02/05/2013
`
`To commence the statutory time for appeals as of right
`(CP~R 55 13[a]), you are advised to serve a copy
`of thIS order, with notice of entry, upon all parties.
`
`SUPREME COURT OF THE STATE OF NEW YORK
`COUNTY OF WESTCHESTER
`...
`--------------~---------------------------------------------------------------x
`PAUL HERRICK, ESQ. and RABIN, PANERO
`& HERRICK, LLP,
`
`Plaintiffs,
`
`-against-
`
`.
`
`STATEWIDE ABSTRACT CORP.,
`
`Defendant.
`------------------------------------------------------------------------------x
`CONNOLL Y, 1.
`
`DECISION and ORDER
`. Sequence NO.1
`Index No. 63036/12
`
`The following documents were read in connection with the defendant, Statewide Abstract
`to CPLR S 3211 (a) (1) and (5):
`Corp.'s, motion to dismiss the complaint pursuant
`
`Defendant's Notice of Motion, Affirmation, Exhibits
`Defendant's Memorandum of Law
`Plaintiff s Affirmation in Opposition, Exhibits
`Plaintiff s Memorandum of Law
`Defendant's Reply Affirmation, Exhibits
`
`1-22
`23
`24-33
`34
`35-37
`
`The plaintiffs, Paul Herrick, Esq. and Rabin, Panero & Herrick, LLP (collectively referred
`to as "Herrick"), commenced this action against defendant, Statewide Abstract Corp. ("Statewide"),
`seeking indemnification or contribution for damages assessed against Herrick as a result of a special
`jury verdict rendered against it in the amount of$252,652.00, plus interest, costs, and disbursements,
`for legal malpractice arising from Herrick's representation of its former clients, Luis X. Rojas and
`Maria Rojas ("Rojas"),
`in the purchase of a parcel of real property. Although both parties to this
`action were named defendants
`in the prior action,
`the plaintiff s complaint and the cross-claim
`asserted by Herrick against. Statewide for contribution and indemnification were dismissed on the
`merits prior to trial. Herrick was the only remaining defendant at trial.
`Statewide moves to dismiss this action pursuant to CPLR S 3211 (a) (1) and (5) on grounds
`that a defense is based upon documentary evidence and the cause of action may not be maintained
`because of collateral estoppel and res judicata. For the reasons set forth below, the Court finds the
`issues raised in this action are the same as those raised, fully litigated, and decided in the prior
`action, and the plaintiffs' claims, which sound in indemnification and contribution, arise out of the
`
`-1-
`
`
`
`sa~e t~ansactions actually litigated and resolved in the prior proceeding and therefore,
`actIOn ISbarred under the principles of res judicata and collateral estoppel.
`
`the within
`
`FACTUAL BACKGROUNDIPROCEDURAL HISTORY
`
`.Herrick, an attorney, represented Luis and Maria Rojas, who were the plaintiffs in the prior
`.
`actIOn, IIIall aspects of the purchase transaction of a parcel of property located at 16 Montana Place
`~hite Plains, New York, from negotiation of the contract of sale through the closing of title. Alon~
`wIth the contract of sale, the purchasers were provided with a survey depicting the property to be
`purchased. The contract of sale included a legal description of the property attached as Schedule
`"A," which described the property as a "parcel of land, situate,
`lying and being in the Town of
`Greenburgh, County of Westchester, State of New York, known and designated as part of Lot No.
`8 as shown on the certain Map ....
`"
`
`In connection with the purchase, Herrick, on behalf of Rojas, ordered a title search and report
`of the subject property through Statewide and requested that Statewide certify title to Rojas'
`title
`insurer, Stewart Title Insurance Company. Herrick provided Statewide with the Schedule "A" legal
`description of the property and a survey that described the property as a "portion of Lot #8."
`Statewide used these documents to conduct its title examination and prepare its title report of the
`property. This same legal description was included in the title insurance policy issued by Stewart
`Title, as well as a bargain and sale deed delivered to Rojas from the sellers at the closing held on
`June 6, 2005. Statewide's
`title report stated in several places,
`including in the Schedule B Title
`Exceptions and in copies of two deeds by which the sellers acquired the property in 2003, that the
`subject property to be conveyed was only a portion of Lot NO.8. The parcel conveyed to Rojas at
`closing consisted of approximately .45 acres ofland improved by a residential home. The remaining
`parcel, which the sellers retained, consisted of approximately .34 acres of unimproved land that had
`been conveyed to the sellers by quitclaim deed in 2003.
`
`Rojas resided at the property until 2007, when they decided to relocate for employment
`reasons. As part of the relocation process, Rojas' employer offered the services of a relocation
`company to purchase the property. The relocation company ordered a title search and report,
`wherein it was revealed that Rojas did not own the entirety of the parcel of land located at 16
`Montana Place, in that only a "portion of Lot No.8," referred to as the house parcel, was conveyed
`to Rojas, with the sellers retaining title to the remaining parcel containing unimproved land. Upon
`discovering that the property consisted of only a portion of Lot No.8,
`the relocation company would
`not accept title to the property.
`
`including Statewide,
`Rojas thereafter commenced a lawsuit against various defendants,
`Herrick, Stewart Title,
`the sellers,
`the sellers' attorney, and the real estate brokers and agents
`involved in the 2005 Rojas purchase transaction. The action was entitled, Luis X Rojas and Maria
`Rojas v. Andrew Paine, et. ai., Westchester County Supreme Court Index Number 27830/07. The
`Rojas complaint alleged that, despite the fact that the sellers owned two parcels comprising Lot No.
`8, the contract of sale and deed purported to sell only a portion of the subject property, the house
`
`-2-
`
`
`
`parc~l. .The complai~t alleged the defendants failed to disclose that the subject property was illegally
`subdlv.lde~ by deed mto the house parcel and remaining parcel without the permission, consent, or
`authOrIZatIOnof the Town of Greenburgh, and that due to materially false representations about the
`true nature and condition ofthe title issues involving the subject property, Rojas only received the
`house parcel at the time of closing. Rojas alleged that the illegal subdivision of the parcel created
`an objection to title, rendering title unmarketable. As is relevant herein, Rojas asserted a cause of
`action. ag~inst Herrick for legal malpractice, and asserted three causes of action against Statewide,
`soundmg m breach of contract, negligence, and breach of insurance agreement.
`
`Rojas claimed that Statewide breached its contract with them by failing to properly perform,
`investigate, and report upon title issues. Rojas also claimed that Statewide negligently, recklessly,
`and carelessly failed to properly perform,
`investigate, and report upon title issues and failed to raise
`an exception to title relative to the illegal subdivision and encroachments.
`In its answer to the Rojas
`complaint, Herrick asserted a cross-claim against Statewide for contribution and indemnification,
`alleging that if the plaintiffs were damaged, such damages were caused by the negligent, intentional,
`or reckless conduct, acts, or omissions of Statewide and therefore, Herrick would be entitled to
`judgment over against Statewide for any judgment plaintiff may recover against Herrick.
`
`Following motions to dismiss by the various defendants, the only remaining defendant at the
`time of trial was Herrick. By decision and order entered on June 29, 2010, the Hon. William J.
`Giacomo, J.S.C., granted Statewide summary judgment dismissing Rojas' claims for negligence and
`breach of insurance contract. The court initially denied Statewide summary judgment on the breach
`of contract cause of action, stating "[i]n view of the fact that the tax lot issue was subsequently
`discovered ...
`there is clearly a question of fact regarding whether Statewide breached its contract
`with plaintiffs to perform a proper title search which included a notation that the portion of Lot 8
`being purchased by plaintiffs was part of a larger lot for which there was no filed subdivision in the
`Town of Greenburgh."
`It further held that "[u]nder the contract for searching titles the defendant
`may be liable for any damages which its negligence may have imposed upon the plaintiff," and that
`"liability can arise in the event the search is performed in a negligent manner."
`
`Thereafter, Statewide moved to reargue Justice Giacomo's denial of summary judgment on
`Rojas' breach of contract claim. The motion was opposed by Rojas, who argued Statewide should
`be held liable for failing to properly conduct a title search and report title defects. Defendant Herrick
`also opposed Statewide's motion and moved for summary judgment against the plaintiffs.
`In Paul
`Herrick's affidavit dated December 22,2010, he argued:
`
`. was defective in several
`.
`.
`"The title report prepared by Statewide
`significant respects. First, the title report failed to disclose that the property
`plaintiffs had contracted to purchase did not conform with the legal
`description and was only a portion of the tax lot owned by sellers, Andrew
`and Karen Paine ("the Paines"). Second, the title report included an outdated
`tax map, which did not include current
`information regarding the tax lot
`associated with the Paines' property. As a result of these errors of omission
`
`-3-
`
`
`
`by Statewide, I was unable to advise my client regarding their options under
`the contract,
`including their option to terminate the transaction upon receipt
`of the title report."
`
`By decision and order dated September 30, 2011, the court granted reargument to Statewide
`and upon reargument, dismissed Rojas' breach of contract claim against Statewide. The cou~
`opined:
`
`"First, Schedule A to the deed clearly identifies the subject property as on a
`'portion of Lot 8,' as opposed to the entire tax lot. Accordingly, Statewide
`examined the title records and issued a title report pertaining to that portion
`of Lot 8 as described in Schedule A. Secondly, the title report did include a
`copy of the quitclaim deed to the Paine's who retained the remaining portion
`of Lot 8. Therefore, Statewide fulfilled its contractual obligations
`to
`Plaintiffs by examining title and issue a title report for the parcel being
`conveyed to Plaintiff-namely,
`the portion of Lot 8."
`
`The September 30, 2011 decision and order also denied Herrick's motion for summary
`judgment. The court found issues of fact remained whether Herrick exercised reasonable skill and
`knowledge in the real estate transaction in light of the Schedule A description, which specifically
`stated the sale was for only a portion of lot 8, and whether such failure, if any, was the proximate
`cause of Rojas' damages.
`
`Rojas and Herrick appealed the September 30, 2011 decision and order, however, Rojas
`withdrew their appeal. Herrick's appeal of the September 30, 2011 decision dismissing plaintiffs
`breach of contract claim against Statewide is fully submitted and is awaiting an oral argument date
`from the Appellate Division, Second Department.
`
`Herrick made an application to stay the trial pending the appeal, which was denied.
`Accordingly, on June 12,2012, the matter was referred to the Hon. BruceL. Tolbert, J.S.C., for trial.
`Before the trial commenced, Herrick indicated that it intended to concede it was negligent
`in its
`representation of Rojas, and submit the issues of proximate cause and damages to the jury. At that
`time Statewide moved to dismiss Herrick's cross-claim for contribution and indemnification.
`,
`Statewide argued that because the June 29, 2010 and September 30, 2011 decisions and orders
`dismissed all of Rojas' causes of action against Statewide, and resolved in its favor the issue of
`whether Statewide provided Herrick and Rojas with a faulty title report, Herrick's cross-claim should
`be dismissed as a matter oflaw. Herrick opposed the motion. After hearing oral argument, Justice
`Tolbert granted the motion and dismissed Herrick's cross-claim against Statewide,
`leaving Herrick
`as the only remaining defendant.
`
`in its representation of Rojas
`Before the trial began, Herrick stipulated that it was negligent
`in that it failed to advise Rojas that the property they purchased was subject to an illegal subdivision.
`However, the issues of proximate cause and damages were submitted to the jury. Following a seven-
`
`-4-
`
`
`
`day trial, upon finding that "but for" Herrick's negligence Rojas would not have sustained damages,
`the jury returned a verdict
`in favor of Rojas against Herrick for legal malpractice in the sum of
`$252,652.00, plus interest, costs, and disbursements.
`
`seeking contribution and
`the instant action against Statewide,
`Herrick now commences
`indemnification. The complaint alleges that Statewide negligently performed a search of the public
`records, and due to Statewide's
`faulty title search, Herrick was not informed that the property upon
`which the house parcel was located constituted only a portion of the tax lot. Herrick alleges that had
`it been properly informed by Statewide that the property was located on only a portion of the tax
`map, Herrick would have advised Rojas to exercise their contractual rights to rescind the contract
`and refuse to purchase the property.
`
`to CPLR S 3211 (a) (1) and (5) on
`Statewide moves to dismiss the complaint pursuant
`grounds that a defense is based upon documentary evidence and the cause of action may not be
`maintained because of collateral estoppel and res judicata. Herrick opposes the motion, arguing that
`it relied upon Statewide's
`faulty title report in counseling Rojas to purchase the property, which
`resulted in the damages sustained by Rojas. Herrick claims it was forced to concede liability and
`accept responsibility for the acts of its agent, Statewide, in preparing a defective title report, and that
`the issue of Statewide's
`liability to Herrick was never determined in the prior action.
`
`DISCUSSION/ANALYSIS
`
`A party may move for judgment dismissing one or more causes of action upon the grounds
`of collateral estoppel and/or res judicata pursuant to CPLR S3211 (a) (5). Further, a party may move
`to dismiss a cause of action pursuant to CPLR S3211 (a) (1) where the movant has a defense founded
`upon documentary evidence. "The doctrines of res judicata and collateral estoppel are employed to
`facilitate a prompt and nonrepetitious judicial process" (Kreindler, New York Law of Torts S19:40
`[West's NY Prac Series 2012]).
`
`Collateral Estoppel
`
`"Collateral estoppel precludes a party from relitigating in a subsequent action or proceeding
`an issue raised in a prior action or proceeding and decided against that party or those in privity"
`(Buechel v Bain, 97 NY2d 295,303 [2001]). "This doctrine applies only 'if the issue in the second
`action is identical to an issue which was raised, necessarily decided and material in the first action,
`and the plaintiff had a full and fair opportunity to litigate the issue in the earlier action '" (City a/New
`York v Welsbach Electric Corp., 9 NY3d 124,128 [2007] citing Parker v Blauvelt Volunteer Fire
`Co., 93 NY2d 343,349 [1999]).
`
`is that Statewide performed a faulty title search in that it
`The crux of plaintiff s complaint
`failed to inform Herrick that the property upon which the house parcel was located constituted only
`a portion of the tax lot. Herrick alleges that had it been properly informed by Statewide that the
`
`-5-
`
`
`
`property was located on only a portion of the tax map, Herrick would have advised Rojas to rescind
`the contract and refuse to purchase the property.
`
`Both the Rojas' causes of action and Herrick's cross-claim against Statewide in the prior
`action were predicated upon the same claims as the instant action-that
`Statewide's title search was
`faulty, in that the title report failed to properly inform the parties that the property purchased was part
`of an illegal subdivision, and only a portion of a larger tax lot. The issue of whether Statewide
`performed a faulty title search was specifically raised in the prior action and was decided in its favor
`and against Herrick, after Herrick had a full and fair opportunity to litigate.
`
`In the prior action, Herrick asserted a cross-claim against Statewide sounding in both
`contribution and indemnification.
`A claim for indemnification involves "an attempt
`to shift the
`entire loss from one who is compelled to pay for a loss, without regard to his own fault, to another
`party who should more properly bear responsibility for that loss because it was the actual wrongdoer"
`(Frump Village Section 3 Inc., v New York State Housing Finance Agency, 307 AD2d 891,895 [151
`Dept 2003], citing Trustees of Columbia University v Michell/Giurgola Associates, 109 AD2d 449,
`451 [151Dept 1985]). A claim for contribution is "available as a remedy 'when two or more
`tort-feasors share in responsibility for an injury, in violation of duties they respectively owe [] to the
`(id. at 896, citing Garrett v Holiday Inns, 58 NY2d 253,258 [1983]).
`injured person'"
`
`cross-claim against Statewide alleged that if the plaintiffs were damaged, such
`Herrick's
`damages were caused by the negligent,
`intentional, or reckless conduct, acts, or omissions of
`Statewide in performing a faulty title search.
`In the prior action, Justice Giacomo affirmatively
`found that Statewide committed no error or omission in conducting the title search and preparing the
`title report since the title report disclosed that the property upon which the house parcel was located
`constituted only a portion of the tax lot. Before the trial commenced, Herrick conceded it was
`negligent
`in its representation of Rojas for failing to advise Rojas that the property was subject to
`an illegal subdivision. Since the issue of Statewide's negligence had already been determined in its
`favor, Justice Tolbert dismissed Herrick's cross-claim for contribution. Moreover, since Herrick
`conceded its wrongdoing, Justice Tolbert dismissed Herrick's cross-claim for indemnification as
`well, as "a party who has itself actually participated in the wrongdoing cannot receive the benefit of
`(Frump Village Section 3 Inc., 307 AD2d at 895 [151Dept 2003]).
`this doctrine"
`
`"The party seeking the benefit of the doctrine of collateral estoppel must establish that the
`identical issue was necessarily decided in the prior action and is determinative in the present action"
`Mahler v Campagna, 60 AD3d 1009, 1011 [2d Dept 2009]). "Once the party invoking the doctrine
`discharges his or her burden in that
`regard,
`the party to be estopped bears the burden of
`(id.).
`demonstrating the absence of a full and fair opportunity to contest the prior determination"
`
`,
`Here Statewide has demonstrated that the identical issue was decided in the prior action and
`is determinative of the present action, while Herrick has failed to sustain its burden to establish that
`it lacked a full and fair opportunity to litigate the issue as a party defendant
`in the prior action.
`Herrick's recourse,
`to which it is availing itself, is to appeal from the orders and judgment
`in the
`
`-6-
`
`
`
`,
`not to commence a new action with the hope of relitigating the issue in its favor.
`prior action-
`Because the identical
`issue was already litigated and decided, and Herrick had a full and fair
`opportunity to litigate the issue in the prior action, the action against Statewide is dismissed on the
`ground of collateralestoppd.
`
`Res Judicata
`
`"The doctrine of res judicata operates to preclude the reconsideration of claims actually
`litigated and resolved in a prior proceeding, as well as claims for different relief against the same
`party which arise out of the same factual grouping or transaction, and which should have or could
`have been resolved in the prior proceeding" (Mahler v. Campagna, 60 AD3d at 1011). "Under the
`transactional analysis approach to res judicata,
`'once a claim is brought
`to a final conclusion, all
`other claims arising out of the same transaction or series of transactions are barred, even if based
`upon different theories or if seeking a different remedy' " (CRK Contracting o/Suffolk, Inc., vJeffrey
`M Brown & Associates, Inc., 260 AD2d 530 [2d Dept 1999] quoting O'Brien v City o/Syracuse, 54
`NY2d 353, 357 [1981]).
`
`The claims of plaintiff in the instant action sounding in indemnification and contribution
`arise out of the same transactions litigated in the prior action-the
`acts of Statewide in its search of
`public records regarding the subject property, and what was contained in the title report as a r.esult
`thereof. Herrick, a co-defendant
`in the prior action, who asserted and prosecuted a cross-claim
`against Statewide, had the opportunity to raise all claims and theories it had against Statewide in that
`action during the four-year proceedings. The claims regarding Statewide's alleged faulty title search
`were brought to a final conclusion in the prior action, precluding Herrick from renewing these claims
`in the instant litigation. Accordingly, Herrick's complaint against Statewide is also dismissed on the
`ground of res judicata.
`'
`
`. Based upon the foregoing,
`
`it is hereby
`
`that the defendant' s motion dismissing plaintiffs' complaint pursuant to CPLR
`ORDERED,
`~ 3211 is granted based upon the grounds of collateral estoppel and res judicata.
`
`All other relief requested and not decided herein is denied.
`
`This constitutes the decision and order of this Court.
`
`Dated: White Plains, New York
`February 5, 2013
`
`~
`
`__t:.~_
`
`HON. FRANCESCA E. CONNOLLY,
`
`l.S.C.
`
`-7-
`
`
`
`To:
`
`Traub Lieberman Straus & Shrewsberry LLP
`Attorneys for the Plaintiffs
`Mid -Westchester Executive Park
`Seven Skyline Drive
`Hawthorne, New York 10532
`
`\
`
`Keane & Beane, P.C.
`Attorneys for the Defendant
`445 Hamilton Avenue, 15th Floor
`White Plains, New York 10601.
`
`-8-
`
`