An appellate panel has reversed a lower court ruling and narrowed the damages claim in a malpractice suit against Rivkin Radler. The firm’s former client, Global Business Institute, a nonprofit corporation operating a vocational school, sued the firm in 2006 for allegedly failing to properly advise it on its plans to move to a new facility in Harlem. The lease was finalized in October 2004, but due to construction delays, Global did not occupy the building until March 2008. Global was asking for more than $3.3 million in damages, according to its amended complaint.
Last April, Manhattan Supreme Court Justice Doris Ling-Cohan (See Profile) denied Rivkin’s partial summary judgment motion to dismiss Global’s claims for tax escalation damages and substantial completion/lost profits damages (NYLJ, April 30, 2012). But a panel of the Appellate Division, First Department, unanimously reversed, finding in Global Business Institute v. Rivkin Radler, 104918/06, that the firm met its burden of showing an absence of proximate cause between the alleged negligence and Global’s losses.
The panel said Rivkin Radler demonstrated that the landlord would not have agreed to an additional penalty beyond deferment of rent for late completion of construction. “Plaintiff’s claim that it would have pursued alternative space is speculative and therefore insufficient to establish that defendant’s malpractice, if any, was a proximate cause of plaintiff’s loss,” the panel wrote last month.
Peter Contino, a Rivkin partner overseeing the case, said, “We’re very pleased with the results. It’s everything we asked for.” A “minor portion of the case” is continuing in the trial court, he added.
Martin Stein, an attorney at Heller, Horowitz & Feit who represents Global, said, “We believe the appellate decision was wrong and we are reviewing our options.”