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Vincent J. Gallo, Esq., "A checklist as to what an attorney should NOT DO in the course of properly representing a Purchaser."

posted Apr 13, 2015, 4:45 AM by Pete Weinman   [ updated Apr 13, 2015, 4:46 AM ]
It’s not a problem………..until it’s a problem.

Blanco v. Polanco, 2014 NY Slip Op 02735 (April 23, 2014) The Plaintiffs purchased a two-

family home from the Defendant, Your First Home, LLC. They did so without first conducting 

an inspection of the premises. At the closing, the Seller agreed to make certain repairs set forth 

on a punch list within 10 business days following closing. Shortly after the closing, the 

Purchasers took occupancy of the premises.

The Seller never completed the punch list. Furthermore, after the Purchasers moved into the 

premises, they discovered mold in various areas and found that water accumulated in the 

basement whenever it rained. Additionally, when the Purchasers tried to rent the second floor 

apartment of the house, they were informed that they could not do so because the house did not 

have a Certificate of Occupancy (hereinafter CO), and that there were numerous "outstanding 

requirements" that needed to be satisfied before one could be obtained.

The Purchasers commenced an action against, among others, the Seller and their attorney who 

represented them in the transaction, alleging that the Defendants in the action colluded to defraud 

them in connection with the purchase of the premises by, inter alia, dissuading them from 

obtaining an inspection (as did the Seller), representing that any repairs and construction required 

on the premises would be performed and paid for by the Seller before or immediately after the 

closing, misrepresenting the condition of the premises, and misrepresenting that the apartment on 

the second floor could be rented immediately upon closing and that the premises had a CO. The 

Purchasers sought to recover damages from their attorney for legal malpractice, fraud, breach of 

fiduciary duty, negligence, unjust enrichment, and conspiracy to commit fraud.

The Purchasers submitted evidence that their attorney had his non-attorney assistant pose as him 

and counsel them throughout the transaction. They also supplied proof that their attorney 

hastened them to sign the Contract of Sale without reading it and failed to advise them that by 

signing the Contract, they were agreeing to purchase the premises "as is" and waiving their 

opportunity to conduct an inspection. They also presented proof that their attorney reassured 

them that the Seller would make needed repairs and advised them that they should trust the 

Seller's opinion that a professional inspection was not necessary. They also presented proof that 

their attorney failed to ask the Seller to fulfill its obligation under the Contract of Sale to provide 

a CO or "a letter from the Building Department . . . to the effect that no CO is required."

Furthermore, the Purchasers submitted a report from the New York City Department of 

Buildings indicating that subsequent alterations may have been made to the premises, triggering 

the need for a CO and that various "outstanding requirements" needed to be satisfied before a CO 

could be obtained.

Compounding the above, the Purchasers submitted evidence showing that their attorney had a 

relationship with the Seller, pursuant to which he received more than 100 referrals from the 

Seller, and when they were in the Seller's office, they were introduced to the non-attorney 

impostor posing as their attorney who told them that he was the attorney. The Court held that 

when viewed as a whole, it may be inferred from this evidence that the attorney and the Seller 

may have colluded to defraud the Purchasers in connection with their purchase of the premises. 

Accordingly, the attorney’s motion for summary judgment was, in large part, denied.

Succinctly, this case stands as a checklist as to what an attorney should NOT DO in the course 

of properly representing a Purchaser.