Commercial Division Blog

Posted: October 27, 2014 / Categories Commercial, Law Firms and Professional Ethics, Account Stated

Account Stated Claim Survives Notwithstanding Plaintiff's Inability Fully to Document All Charges

On October 23, 2014, the First Department issued a decision in Robson & Miller, LLP v. Sakow, 2014 NY Slip Op. 07263, affirming a grant of summary judgment on a claim for account stated.

In Robson & Miller, the plaintiff law firm sued its former client. In affirming the trial court's grant of summary judgment to the plaintiff on its claim for account stated, the First Department explained:

The motion court properly concluded that the varying figures given by R & M during this litigation, as to the total outstanding fees due, did not undermine R & M's prima facie case for an account stated, inasmuch as the discrepancies were plainly attributable to the incompetence of its original attorney in drafting the motion papers on its previous motions for summary judgment, which, inter alia, did not include R & M's complete billing invoices from the past, and records of off-sets that the parties had agreed to. The monthly invoices and records - the timely receipt of which Sakow never disputed - were never challenged by Sakow as to accuracy or reasonableness until the instant litigation was commenced years later. Such circumstances, including that Sakow continued to make payments towards the total fees accrued and billed, without reservation, belie the belated challenges to the reasonableness of the invoiced fees. For similar reasons, Sakow's argument that the initial invoice related to the 2002 to 2008 fee collection period in question, dated March 7, 2002, reflected a bare, balance forward figure of $81,484.75 without requisite supporting time sheet information, is unavailing. The record reflects that R & M represented Sakow on many legal matters since 1989, and that R & M would send regular, detailed monthly invoices to account for the fees claimed. The record also demonstrates that Sakow never denied receipt of invoices supporting the balance forward figure referenced in the March 7, 2002 invoice, that no objection was raised as to such invoices, and that Sakow continued to make regular payments towards the invoices.

(Internal quotations and citations omitted).  This decision shows the potential power of a claim for account stated and the principle upon which it is based, which is that if the recipient of the account does not challenge invoices, the court will not later make the plaintiff go back and prove their underlying basis.

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