Tomorrow, October 28, judges on Part E of the Appellate Division will hear oral argument in Nagel Rice, LLP v. Starkey, Kelly, Kenneally, Cunningham & Turnbach. It is relatively rare for one law firm to sue another, but that has occurred here.

The case arose out of a court order that allowed plaintiff’s former client, Benjamin Ringel, to use certain monies that were being paid monthly into escrow to, among other things, pay down a large amount of attorneys’ fees that he owed to plaintiff. Defendant, the escrow agent, was to make the payments. Plaintiff alleged that itself and defendant thereafter agreed, at Ringel’s direction, that the escrowed monies would be used solely to pay plaintiff. Plaintiff alleged that defendant so applied the escrowed funds but later began to use those monies for purposes other than paying plaintiff. Plaintiff then sued defendant.

Defendant moved to dismiss the Complaint, and the trial court granted that motion. The court gave two reasons for that ruling. First, there was no agreement between the parties that the escrowed funds were to be used solely to pay plaintiff. Second, the parties could not validly have altered the court order that called for payments to plaintiff to be just one of the uses of the escrowed monies, not the only use.

On appeal, plaintiff argues (among other things) that the parties did enter an agreement under which plaintiff would receive all the escrowed sums as they were paid into escrow, and that defendant acknowledged that. Plaintiff also contends that the language of the order did not preclude that agreement. Among other things, defendant counters that the court had rejected plaintiff’s applications for an order calling for all of the escrowed monies to be paid to plaintiff, so that the order ultimately entered could not be construed as allowing plaintiff and defendant alter the order, without court approval, to agree to do just that. And defendant asserts that, at most, there was an agreement to alter the order between Ringel and plaintiff only, and that defendant was not party to or bound by any such agreement, notwithstanding defendant’s acknowledgment on which plaintiff relies.

The briefs on this appeal are available here. The oral argument can be viewed on a livestream at this link.