Adam Leitman Bailey, P.C. Prevails for Title Company in Policy Claim and Wins Attorney Fees
Adam Leitman Bailey, P.C. swiftly and successfully moved to dismiss a claim and cross-claim for a failed 1031 exchange and was awarded attorneys fees in an amount to be determined.
Plaintiffs were principals of commercial property holders who, in 2015, attempted to engage in a 1031 exchange. To do so, they engaged Pardalis & Nohavicka LLP, (“P&N”) who held themselves out as 1031 exchange experts. When the IRS disallowed the 1031 exchange, Plaintiffs sued for malpractice based on the incorrect legal advice given to them.
Plaintiffs had engaged Titlevest Agency of New York and 1031Vest, LLC, a Qualified 1031 Intermediary (the “FirstAm Defendants”) to act as the Qualified Intermediary and to hold and disburse sale proceeds in accordance with the IRC. In an action brought in mid-December, 2021, Plaintiffs sued P&N for malpractice and the FirstAm Defendants on the theory that each was a fiduciary with a duty to examine the details of the 1031 exchange and to advise Plaintiffs that the proposed exchange would not qualify. P&N cross-claimed, alleging that the FirstAm Defendants violated their contractual duties to P&N and were negligent.
Adam Leitman Bailey, P.C.was asked to defend the FirstAm Defendants. Based on the contract between Plaintiffs and the FirstAm Defendants, Adam Leitman Bailey, P.C. moved in April 2022 to dismiss the complaint on the basis of documentary evidence and for attorneys’ fees. By order of September 15, 2022, Justice Headley granted the motion and set the matter down for a hearing on the amount of attorneys’ fees at a future date.