Opinion ID: 2334156
Heading Depth: 1
Heading Rank: 8

Heading: The Malakoff Matter

Text: In April 1984, Irving Malakoff retained respondent to represent his son in connection with the purchase of a dry cleaning business. Malakoff tendered a $3,500 deposit and gave respondent $1,250 to be paid to a broker, who was to procure an S.B.A. loan. After the broker was unable to obtain the loan, the transaction aborted. The broker, however, did not return the $1,250 fee, which was non-refundable. Malakoff then complained to respondent, contending that he had not been informed that the fee was non-refundable. Respondent, in turn, reminded Malakoff that she had so advised him at the inception of the transaction. In order to reach a compromise, respondent agreed to return one-half of the brokerage fee out of her own funds. Following the conclusion of the ethics hearing, the committee recommended the dismissal of this count of the Malakoff complaint for lack of clear and convincing evidence that respondent's conduct had been unethical. Malakoff also complained that respondent had assured him that she would institute suit for the return of the $3,500 deposit. At the ethics hearing, however, respondent disputed Malakoff's contention. She testified that she had referred the matter to another attorney, with Malakoff's knowledge and consent. Following the ethics hearing, the committee also recommended the dismissal of this count of the Malakoff complaint for lack of clear and convincing evidence of unethical conduct by respondent. Additionally, Malakoff complained about respondent's conduct in connection with a real estate transaction in which he and two other partners were involved as purchasers. In this transaction, Malakoff and his partners were represented by an attorney who also represented one of the partners in an unrelated matter. When the transaction was cancelled because of the partners' inability to raise the necessary funds, Malakoff consulted with respondent about any legal remedies that might be available to him. According to Malakoff's testimony, respondent advised him to pursue a claim against the attorney, in light of the obvious conflict of interest raised by the dual representation. Malakoff and respondent discussed a lawsuit for damages in an amount exceeding $100,000. Although Malakoff's and respondent's testimonies at the committee hearing differ with respect to certain allegations concerning the filing of the suit  Malakoff contending that respondent had informed him on several occasions that a suit had been filed and respondent denying this contention [2]  it is undisputed that, in Malakoff's presence, respondent personally prepared a typewritten document in pleading form, titled Affidavit in Support of Order to Show Cause. See Exhibit C-1 introduced into evidence at the ethics hearing of October 21, 1987. Exhibit C-1 recites, in pertinent part, that [i]n accordance with the terms of the last Court hearing discovery was set in this matter and was to be complete on or before January 9, 1987. The contents of the affidavit were false inasmuch as respondent still had not instituted suit. Following the conclusion of the ethics hearing, the presentment found that respondent had made numerous misrepresentations to Malakoff that an action had been initiated in his behalf and had prepared a document for the purpose of misleading Malakoff that litigation was pending.