In short, Melcher alleges that Corwin and Greenberg Traurig "falsely and misleadingly represented to the Supreme Court that they were holding the originals in escrow with intent to deceive, to prevent the Supreme Court and plaintiff from ever discovering that the amendment had been burned under highly suspicious circumstances, that the files of the law firm that supposedly drafted it contained no evidence that it ever existed, and that the lawyers who supposedly drafted it had no knowledge of it."
Melcher alleges that Corwin and his firm violated Judiciary Law §487, which provides for treble damages to a party injured by deceit or collusion by an attorney.
Corwin and the firm moved to dismiss the case as time-barred, arguing that the alleged injury had accrued in March 2004, when Melcher learned that Corwin had failed to disclose Fradd's claim that the amendment had been burned. The suit was filed more than three years after that, putting it outside the statute of limitations.
Manhattan Supreme Court Justice Shirley Kornreich (See Profile) agreed that the injury first accrued in March 2004. However, she denied the motion to dismiss, finding that Corwin and his firm were equitably estopped from asserting the statute of limitations because they allegedly continued to deceive Melcher about Governale and Beckwith.
The First Department majority reversed and ruled that the case should be dismissed.
"The accrual date was not extended here because, as noted above, plaintiff was aware of the basic facts relative to defendants' alleged deceit more than three years before this action was commenced," a majority of Presiding Justice Luis Gonzalez (See Profile) and Justices David Saxe (See Profile) and Leland DeGrasse (See Profile) wrote in an unsigned opinion.
The majority also said that equitable estoppel did not apply "because plaintiff has not met the fundamental requirement of establishing that subsequent and specific actions by defendants somehow kept him from timely bringing suit."
Justice Nelson Roman (See Profile) dissented, joined by Justice Helen Freedman (See Profile). Roman said the injury did not accrue until 2005, because the plaintiffs were not aware of all the facts needed to support their claim until that time.
"According to the complaint…plaintiff did not become aware that Corwin's assertions were false until December 7, 2005 when Governale was deposed and testified that he knew nothing about the amendment at issue and that his files contained no indication of any such amendment," Roman wrote. "Therefore, it was not until this date, when all the facts necessary to a cause of action pursuant to Judiciary Law §487 were known that plaintiff's cause of action accrued. Specifically, it was on that date that the realization that plaintiff had been deceived by Corwin occurred."
Furthermore, Roman said, the injury could not have accrued in March 2004 because Corwin's failure to tell Melcher that Fradd claimed to have burned the letter was not enough to support a claim under Judiciary Law § 487. Corwin, he said, had no duty at that time to reveal that the letter had been burned.