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An intense legal saga unfolds as Brooklyn resident Isaac Hagar persists in pursuing a malpractice claim against Phillips Nizer LLP, despite the absence of a direct attorney-client relationship, a determined Empire State judge ruled. The decision, filed by Justice Reginald A. Boddie on Friday, marks a pivotal point in Hagar's legal battle stemming from an alleged real estate loan deal gone awry.

 A "No Risk" Venture Turns Into a Legal Quagmire

Hagar, a real estate investor, claims he was lured into a "no-risk" opportunity to provide a $1 million loan for the purchase of property in Orange County, New York. The intricate deal involved multiple entities, including Inner Circle Logistics Inc. (ICL), Riverside Abstract LLC, SDC New Windsor Realty LLC, 20 World Trade Way Realty LLC, SDC Hudson Valley Realty LLC, and 108 World Trade Way Realty LLC.

Under the alleged agreement, Hagar was assured by ICL and its attorney, David Rosenberg, that he would be promptly repaid, with the added security of an assignment of the right to cancel the underlying property purchase. However, as events unfolded, the promised safeguards crumbled, leading to a web of legal complexities.

Phillips Nizer Can't Ditch Real Estate Malpractice Suit: Legal Maneuvers Unleashed

In a strategic move, Hagar filed nine claims against various defendants, singling out Phillips Nizer LLP for malpractice and prima facie tort. The lawsuit detailed a sequence of events where ICL defaulted, leaving Hagar empty-handed, as neither SDC nor ICL returned the $1 million deposit.

The Legal Confrontation - Defense Claims vs. Plaintiff's Persistence

In November 2023, Phillips Nizer LLP, along with attorneys Marc A. Landis and David Rosenberg, sought dismissal of the claims, arguing that Hagar's allegations were an attempt to transform a breach of contract into a malicious tort claim against the attorneys. The defense contended that there was no evidence to suggest their actions aimed solely to harm Hagar.

In response, Hagar pointed to New York state law, asserting that an exception exists for cases involving professional negligence in the presence of fraud, collusion, malicious acts, or special circumstances, even without an attorney-client relationship.

Phillips Nizer Can't Ditch Real Estate Malpractice Suit: Judge's Verdict

In a dramatic twist, Justice Boddie delivered a decisive blow to the defense, rejecting the motion to dismiss the malpractice claim. The judge acknowledged the exceptional circumstances under which a malpractice cause of action could be asserted without an attorney-client relationship.