The opinion of the court was delivered by: PARKER
BARRINGTON D. PARKER, JR., U.S.D.J.
Plaintiffs Treasure Lake Associates and Dennis Pemberton filed this action to recover damages from defendants arising from defendants' legal representation of Pemberton in connection with a real estate transaction. Plaintiffs allege that defendants Stephen L. Oppenheim, Perry E. Meltzer and the law firm of Oppenheim & Meltzer committed legal malpractice and breached their fiduciary duties to Pemberton. This Court previously granted plaintiffs' motion for summary judgment on the issue of liability. Treasure Lake Assocs. v. Oppenheim, No. 88 Civ. 9109 (S.D.N.Y. Mar. 24, 1997).
Defendants have now moved for summary judgment on the issue of damages, contending that plaintiffs have not put forth sufficient evidence to meet the requirements for an award of damages. For the reasons that follow, defendants' motion is granted.
The events that gave rise to this dispute are fully recounted in the Court's Memorandum Opinion and Order of February 27, 1997, familiarity with which is assumed. Accordingly, what follows is a brief summary of the essential facts relevant to this motion. As required on a motion for summary judgment, any ambiguities have been resolved in the light most favorable to the plaintiffs, as the party opposing the motion, and all reasonable inferences have been drawn in favor of the plaintiffs. Wernick v. Federal Reserve Bank of New York, 91 F.3d 379, 382 (2d Cir. 1996).
Sometime prior to May 1986, Pemberton entered an agreement to purchase a large parcel of undeveloped real property in Sullivan County, New York comprised of 25 building lots and a condominium site (the "Sullivan County Property"). Pemberton planned to assign his right to purchase the Sullivan County Property to an investor, who eventually was identified as Treasure Lake. When the seller failed to convey, Pemberton, in May 1986, hired the law firm of Oppenheim & Meltzer to assist in acquiring the Sullivan County Property, either by lawsuit or by negotiation. Pemberton directed Oppenheim & Meltzer to file an action for specific performance in the New York Supreme Court, Sullivan County. The firm also represented Pemberton before the Human Rights Commission in a suit he had initiated on the theory that the seller's refusal to convey was racially motivated.
In June 1986, Pemberton, believing that Oppenheim & Meltzer, as his legal counsel, was focused too narrowly on litigation rather than the goal of acquiring the Sullivan County Property, negotiated a settlement directly with the seller, without the involvement of Oppenheim & Meltzer. This settlement provided that the seller convey the property to Pemberton or his assignee, as well as pay Pemberton $ 75,000 to cover his legal fees and other expenses. The closing was scheduled for February 4, 1987. On January 14, 1987, Oppenheim & Meltzer, having been notified of the settlement, learned that Pemberton planned to pay the firm $ 22,500 of the $ 75,000 he expected to receive at closing. Oppenheim believed, incorrectly, that the fee agreement entitled the firm to more than $ 22,500 and consequently took actions to impede the closing. The firm, for example, refused to cooperate in the preparation and execution of the closing papers. Pemberton attempted to ascertain the basis of Oppenheim's dissatisfaction and the reasons for his failure to cooperate. The firm did not advise Pemberton of the nature of its concerns. As the time of the closing approached, Oppenheim & Meltzer prevented the release of documentation essential to the closing and as a result the transaction could not close as scheduled on February 4, 1987.
Meanwhile, in anticipation of the closing, Pemberton and Treasure Lake entered an agreement on February 4 pursuant to which Pemberton would develop the property, which would be owned by Treasure Lake. The agreement contemplated that the property would be developed and the lots sold and provided that Pemberton would perform all the services necessary to accomplishing that end. As compensation for his services Pemberton would receive 42.5% of the Net Proceeds from the sale of lots or the condominium site. The agreement defined Net Proceeds as the sales revenue minus any of a variety of expenses connected to the development and sale of the property.
The next day, February 5, 1987, Pemberton discharged Oppenheim & Meltzer and explicitly instructed them by letter to refrain from interfering with the transaction. The transaction closed the following day, February 6, 1996. Pemberton admits that he incurred no additional expenses as a result of the delay in the closing. Treasure Lake, as Pemberton's assignee, purchased the 25 lots and retained a contractual right to purchase the condo site.
Thereafter, in March 1987, Oppenheim & Meltzer commenced an action in Supreme Court, Sullivan County to recover legal fees allegedly owed by Pemberton. In connection with this action, the firm filed a Notice of Pendency against the Sullivan County property, which impaired the property's title.
In December 1990, the Appellate Division found that there was no justifiable basis for the defendants' filing of the Notice of Pendency and ordered it removed. See Oppenheim v. Pemberton, 164 A.D.2d 430, 563 N.Y.S.2d 908 (1990). In May 1991, Oppenheim & Meltzer's lawsuit for fees proceeded to trial and the court found that the firm and its partners had committed serious misconduct by, among other things, acting against the interests, directions, and desires of their client in order to further what they perceived to be their own interests. Oppenheim & Pemberton, No. 665/87, slip op. at 32-33 (N.Y. S. Ct. Aug. 12, 1992).
Plaintiffs claim that defendants' unjustified filing of a Notice of Pendency prevented plaintiffs from selling portions of the property, as they attempted to do. The plaintiffs did enter into contracts of sale for portions of the property, but not of these transactions were completed. Plaintiffs now claim to be entitled to damages for lost profits as a result of the lack of sales caused by the Notice of Pendency. Additionally, Pemberton argues that the damages calculation should include losses stemming from his personal financial difficulties, ...