Plaintiff, who sued individually and in his capacity as a board member of a corporation, lacks standing

In Glaubach v Miller, 200 AD3d 414, 414-15 [1st Dept 2021], the court held that the Plaintiff, who sued individually and in his capacity as a board member of a corporation, lacks standing to commence this action.

The complaint, which asserts a single cause of action for legal malpractice, is premised on defendants’ allegedly deficient pleading of causes of action under Business Corporation Law Section 720. Any Business Corporation Law Section 720 causes of action, however, belonged to the corporation, not to plaintiff as an individual. Thus, only the corporation has standing to sue for legal malpractice arising from those causes of action (see Walker v Saftler, Saftler & Kirschner, 239 AD2d 252, 252 [1st Dept 1997]), and plaintiff does not dispute that he has failed to plead the pre-suit requirements necessary to sue derivatively on behalf of the corporation under Business Corporation Law Section 626 (see Griffith v Medical Quadrangle, 5 AD3d 151, 152 [1st Dept 2004]). Furthermore, plaintiff’s payment of legal fees does not confer standing on him (see Matter of Priest v Hennessy, 51 NY2d 62, 69-70 [1980]; Kalish v Lindsay, 47 AD3d 889, 891 [2d Dept 2008]).

 


Richard A. Klass, Esq.
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Richard A. Klass, Esq., maintains a law firm engaged in civil litigation at 16 Court Street, 28th Floor, Brooklyn, New York. He may be reached at (718) COURT●ST or RichKlass@courtstreetlaw.com with any questions.

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