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Defense Digest

On the Pulse…Our Real Estate E&O Liability Practice Group

Defense Digest, Vol. 28, No. 12, December 2022

Our Real Estate E&O Liability Practice Group has a long history of representing real estate professionals. We have defended real estate brokers and agents, title agents and abstractors, appraisers, surveyors, home inspectors, mortgage companies, property management companies and condominium associations, on all types of claims brought in state and federal court and regulatory forums throughout all jurisdictions in Pennsylvania, New Jersey, New York, Florida, Delaware, Ohio and Connecticut.

These claims manifest themselves in a variety of ways, with most arising from commercial and residential real estate transactions. They involve disputes surrounding disclosures, financing, valuation, liens, zoning, property management, conditions, construction, and a variety of other items that arise from the property acquisition and transfer process. The claims range from contract to tort, to those raising statutory violations. Many present equitable issues involving easements, deed restrictions and title.

Apart from these standard E&O claims, the Group also represents and defends condominium associations and boards in disputes arising with and between unit owners and third parties. These claims may involve property damage, construction, water, fire and mold disputes. They can also include a variety of other issues, including those specific to particular jurisdictions, like mold, sinkholes and storm-related claims. We also handle disputes surrounding the legal interpretation and application of association governance documents, such as declarations and by-laws in declaratory judgment actions.

In the regulatory forum, our lawyers regularly defend real estate professionals against customer complaints resulting from the delivery of services. They often implicate violations of state and administrative law concerning the delivery of professional services. We defend real estate agents, appraisers, title agents and a variety of other professionals from these complaints, starting with the customer complaint or initial inquiry received through the administrative hearing process.

Our practice group is composed of seasoned, creative and highly regarded lawyers who have litigated many complex disputes. They include shareholders: Jay Rothman, Jeffrey Chomko and Dana Gittleman in Philadelphia; Christopher Conrad in our Harrisburg office; Jonathan Kanov in Fort Lauderdale, Florida; Christopher Block in our Roseland, New Jersey, office; and Aaron Moore in our Wilmington, Delaware, office. We also have a team of associates and paralegals who work with them in preparing and defending all aspects of these cases.

We pride ourselves on our strong reputation, earned over the last 60 years through the successful defense of the most complex and difficult matters. Our philosophy is simple: to quickly evaluate and strive to efficiently resolve these matters at an early stage, if possible, in order to avoid costly, unpredictable litigation. Nevertheless, if necessary, we are prepared to take to trial those cases that cannot be resolved.

We also present seminars and training sessions to clients and insureds that address legal issues that arise in the particular jurisdictions we service. We discuss best practices for real estate agents, home inspectors and other professionals. We welcome you to look at the bios of our attorneys in the group and reach out to us with any questions.

 

Defense Digest, Vol. 28, No. 12, December 2022, is prepared by Marshall Dennehey to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. ATTORNEY ADVERTISING pursuant to New York RPC 7.1. © 2022 Marshall Dennehey. All Rights Reserved. This article may not be reprinted without the express written permission of our firm. For reprints, contact tamontemuro@mdwcg.com.

Firm Highlights

Thought Leadership

Delaware Superior Court Clarifies Pleading Standard for Legal Malpractice Claims

In the matter of Edelstein v. Kirschner, No. N25C-09-018 FJJ, 2026 Del. Super. LEXIS 45, at *1 (Super. Ct. Jan. 29, 2026), the plaintiff law firm sued its former client for unpaid legal fees in the amount of $4,399.35. The former client asserted a counterclaim alleging legal malpractice. More, specifically, the former client claimed that his lawyer committed malpractice be recommending that he settle an underlying lawsuit by entering into a stipulated judgment for an excessive amount with interest that was accruing at “an outlandish” interest rate. The law firm moved to dismiss the counterclaim on the basis that its former client had not alleged facts reflecting that he could prove the case within the case. That is, facts reflecting that his attorneys caused him to lose the underlying case. The Superior Court held that while a legal malpractice plaintiff in cases arising from underlying litigation must prove the case within the case to survive a summary judgment motion, he does not need to plead facts reflecting as much in order to survive a motion to dismiss. While this case addresses the pleading requirements of a legal malpractice case in Delaware, it also serves as reminder that chasing unpaid legal fees from a former client can often give rise to a legal malpractice counterclaim. Attorneys seeking to collect unpaid legal fees should ensure that the fees they seek are for a significant amount, which would be recoverable if a judgment is obtained. Otherwise, the effort could backfire.

Thought Leadership

Appellate Division Affirms Dismissal of Legal Malpractice Counterclaim Against Martin Law Firm

In Martin v. Loury, 2026 N.J. Super. Unpub. LEXIS 1617 (App. Div. July 15, 2026), Martin Law Firm represented Kirk Loury in an employment matter Mr. Loury filed against his former employer, Concord Equity Group Advisors LLC (“Concord”). The allegations included, among other things, that Loury was not fairly compensated for his employment with Concord. After a bench trial finding in Loury’s favor, the Appellate Division remanded this matter in February 2016 for a second trial. During the second trial, Concord CEO, Lee Argush, testified to lower compensation estimate than first trial. On remand, the second trial judge awarded Mr. Loury the same damages as the first judge, finding Mr. Argush not credible. After the findings during the second trial, Martin Law Firm filed an action against Mr. Loury to recover legal fees and costs of representing Mr. Loury in a second bench trial and Mr. Loury filed a counterclaim against Martin Law Firm for legal malpractice, alleging he should have received an even higher award in the second bench trial. In this allegation, Mr. Loury, through his expert, claimed that Martin Law Firm should have recalled Mr. Loury to the stand to rebut Mr. Argush’s testimony to allege an alternative theory of damages. Mr. Loury’s expert admitted that the second judge already rejected Mr. Argush's theory and accepted Loury's damages theory. The trial court barred Mr. Loury’s expert and dismissed Loury's counterclaim with prejudice before convening the collection trial, and the jury ruled in Martin Law Firm’s favor. Mr. Loury appealed the trial court's pretrial rulings barring his liability expert from testifying in support of his legal malpractice counterclaim, denying his motion for summary judgment on that counterclaim, and denying his motion to amend his counterclaim by adding attorney Joseph A. Martin as a codefendant. In affirming the trial court’s decision, the Appellate Division held that the trial court properly excluded Loury’s expert testimony in the counterclaim against Martin Law Firm because the expert could not explain how calling Loury as a rebuttal witness would have increased damages when the second judge already rejected Mr. Argush's testimony and accepted Loury's damages theory, making the expert’s causation opinion speculative. The Appellate Division also held that the trial court properly denied Mr. Loury's summary judgment motion on his malpractice counterclaim because reasonable minds could differ on whether Mr. Martin's alleged failures would have changed the second judge's damages award, given the judge already found Mr. Argush not credible, creating genuine factual disputes precluding summary judgment. Also, the Appellate Division held that the trial court properly denied Loury's May 2023 motion to add Joseph Martin individually because the statute of limitations expired in February 2022, six years after the 2016 appellate remand when Mr. Loury incurred new legal costs, and relation back did not apply because Mr. Loury knew Mr. Martin's identity throughout and strategically chose to sue only Martin Law Firm in his 2019 counterclaim.