CPLR Update Bridging the Gap | August 2018 New York State Bar Association Committee Continuing Legal Education ______

Home , Borrowing statute, Crossclaim, Village View

Speaker: David L. Ferstendig, Esq. Law Offices of David L. Ferstendig, LLC. New York City Date: Thursday, August 16, 2018 Time: 9:05 to 10:20 a.m. Where: Hotel Pennsylvania 401 7th Avenue New York, NY 10001

DAVID L. FERSTENDIG BIO

David L. Ferstendig, currently a member of Law Offices of David L. Ferstendig, LLC, New York, was a founding officer of the law firm Breindel & Ferstendig, P.C. He litigates a spectrum of civil and commercial matters, including breach of contract, products liability, toxic tort, insurance and reinsurance coverage, jewelers’ block, political risk, environmental liability, trade secret, and professional indemnity. Mr. Ferstendig is also an adjunct law professor at Brooklyn Law School and New York Law School, where he teaches New York Practice. He is the General Editor of Weinstein, Korn & Miller New York Civil Practice: CPLR (LexisNexis), the premier 15-volume litigation treatise cited regularly as authoritative by New York State and Federal courts; author of Ferstendig, Chase New York CPLR Manual (LexisNexis) and LexisNexis AnswerGuide New York Civil Litigation; and General Editor of CPLR Practice Insights, published in New York Consolidated Laws Service (LexisNexis). He has written articles for the New York Law Journal, authored a law review article entitled: “A Practitioner’s Continued Uncertainty: Disclosure from Nonparties,” 74 ALB. L. REV. 731 (2010/2011) and was a panelist at New York University School of Law in March 2013 for the symposium entitled “The CPLR at Fifty: Its Past, Present, and Future” which resulted in the publication of his remarks, “The CPLR: A Practitioner’s Perspective.” Mr. Ferstendig has co-authored two law review articles with Professor Oscar Chase of NYU Law School entitled: Chief Judge Kaye: Improving the Pace and Integration of Litigation, 92 N.Y.U. L. REV. 11 (2017) and Should Counsel for a Non-Party Deponent be a “Potted Plant”?, 2014 N.Y.U. J. Legis. Pub. Pol’y Quorum 52. Mr. Ferstendig has provided expert testimony interpreting the meaning and application of New York law and has been quoted as an expert on legal procedure in New York in The Washington Post. He was a 2015 and 2011 recipient of New York Law School’s Otto L. Walter Distinguished Writing Award. A graduate of New York University School of Law, Mr. Ferstendig has lectured on civil practice issues for bar associations, the New York State Judicial Institute and LexisNexis. He is a member and past Chair of the CPLR Committee for the New York State Bar Association. Effective with the May, 2015 edition, Mr. Ferstendig became the Editor of the New York State Law Digest. He was selected by the New York State Board of Law Examiners as a faculty member presenting Civil Practice and Procedure to 2016 bar examination candidates as part of the New York law course.

Portions of the text reprinted from the following permission:

• Weinstein, Korn & Miller: New York Civil Practice: CPLR, Rel 162 – 169 (David L. Ferstendig ed., LexisNexis Matthew Bender 2d Ed.). Copyright 2018 Matthew Bender & Company, Inc. a LexisNexis company. All rights reserved.

Table of Contents

Table of 2018 CPLR Amendments ...... 8 Table of 2017 CPLR Amendments ...... 10 New Appellate Division Uniform Rules ...... 11 New E-Filing Rules Applicable to Appellate Division...... 11 STATUTE OF LIMITATIONS ...... 12 CPLR 201...... 12 CPLR 202 - Borrowing Statute ...... 14 Relation Back ...... 20 CPLR 204 Stay ...... 25 CPLR 205(a) - Six Month Extension ...... 26 CPLR 207- Absence Toll ...... 30 CPLR 208 - Disability toll ...... 30 CPLR 212- Ten year statute of limitations ...... 31 CPLR 213 – Six-year statute of limitations ...... 32 CPLR 213-a - Residential rent overcharge ...... 43 CPLR 214 - Three year statute of limitations ...... 44 CPLR 214-a - Medical, dental or podiatric malpractice actions – two years and six months .. 52 CPLR 214-c- Discovery statute of limitations ...... 61 CPLR 214-c - Statute runs from date condition or symptom is discovered or reasonably should have been discovered, not the discovery of the specific cause of the condition or symptom .. 62 CPLR 215 - One year statute of limitations ...... 63 CPLR 217- Four month statute of limitations, “[u]nless a shorter time is provided in the law authorizing the proceeding” ...... 63 CPLR 217 - Article 78 proceeding appropriate where challenge is directed to the procedure followed in enacting, rather than the substance of, legislation ...... 69 CPLR 217 - 30-day statute of limitations applies ...... 70 CPLR 217 - Challenge to university's academic and administrative decision ...... 70 CPLR 217 - No toll for plaintiff's invocation of defendant's voluntary student grievance procedure...... 70 CPLR 217 - Gravamen of petition was that grading system was implemented in violation of lawful procedure, affected by an error of law, and arbitrary and capricious...... 71 CPLR 217-a - One year and 90 days ...... 72 JURISDICTION ...... 77

CPLR 301...... 77 CPLR 302 - Specific Jurisdiction ...... 85 COMMENCEMENT ...... 94 CPLR 304 - Commencing actions or special proceedings ...... 95 SUMMONS ...... 96 CPLR 305 - Summons ...... 96 SERVICE ...... 97 CPLR 306-b - Service of initiating pleadings ...... 97 CPLR 308 - Personal service on natural persons ...... 103 CPLR 311 - Personal service on corporation or governmental subdivision ...... 114 CPLR 312-a - Service by mail ...... 115 DEFENDANT’S APPEARANCE ...... 115 CPLR 320 - Defendant’s appearance ...... 115 CPLR 321- Attorneys ...... 117 REMOVAL ...... 118 CPLR 325 - Grounds for removal ...... 118 CPLR 325(b) - Motion must be accompanied by a request for leave to amend the ad damnum clause of the complaint ...... 118 FORUM NON CONVENIENS ...... 118 ARTICLE 4 - SPECIAL PROCEEDINGS...... 120 CPLR 402 - Pleadings in special proceedings ...... 120 CPLR 403 - Notice of petition; order to show cause ...... 121 CPLR 408 - Disclosure in special proceeding ...... 123 ARTICLE 5 - VENUE ...... 123 ARTICLE 9 – CLASS ACTIONS ...... 131 ARTICLE 10 - PARTIES GENERALLY ...... 133 CPLR 1003 - Service outside time to add parties as of right ...... 133 ARTICLE 14- A – CONTRIBUTORY NEGLIGENCE ...... 134 CPLR 1412 - Burden of proof ...... 134 ARTICLE 20- MISTAKES, DEFECTS, IRREGULARITIES AND EXTENSIONS OF TIME ...... 136 ARTICLE 21 - PAPERS ...... 145 CPLR 2103 - Service of papers ...... 145 ARTICLE 22- STAY, MOTIONS, ORDERS AND MANDATES ...... 146

CPLR 2212 - Where motion made ...... 146 CPLR 2214- service of motion papers ...... 147 CPLR 2219/2220 - Time, form, entry and filing of order ...... 147 CPLR 2221 - Motions to reargue or renew ...... 149 ARTICLE 23 - SUBPOENAS, OATHS AND AFFIRMATIONS ...... 151 CPLR 2303-a - Service of a trial subpoena ...... 151 CPLR 2304 - Motions to quash ...... 151 CPLR 2308 - Disobedience of subpoena ...... 152 ARTICLE 30 – REMEDIES AND PLEADINGS ...... 152 CPLR 3001- Declaratory judgment ...... 152 CPLR 3011 - Kinds of pleadings ...... 153 CPLR 3012-a - Certificate of merit in medical, dental and podiatric malpractice actions ..... 154 CPLR 3013 - Particularity of statements, generally ...... 155 CPLR 3016 - particularity in specific actions ...... 156 CPLR 3018- Responsive pleadings ...... 157 CPLR 3019 - Counterclaims and cross-claims ...... 158 CPLR 3022 – Remedy for defective verification ...... 159 CPLR 3025 – Amended and supplemental pleadings...... 159 CPLR 3043 - Bill of particulars in personal injury actions ...... 164 ARTICLE 31 - DISCLOSURE ...... 165 CPLR 3101- Scope of disclosure ...... 165 CPLR 3104 - Supervision of disclosure...... 180 CPLR 3116 - Signing Deposition ...... 181 CPLR 3119 - Uniform interstate depositions and discovery ...... 182 CPLR 3121 - Physical or Mental Examination...... 182 CPLR 3122 - Objections to disclosure, inspection or examination ...... 184 CPLR 3122-a - Certification of business records ...... 184 CPLR 3124 - Motion to compel disclosure ...... 185 CPLR 3126- Penalties for refusal to comply with order or to disclose ...... 185 ARTICLE 32- ACCELERATED JUDGMENT ...... 195 CPLR 3211- Motion to Dismiss ...... 195 CPLR 3212 - Summary judgment motion ...... 209 CPLR 3213 - Summary judgment in lieu of complaint ...... 216 CPLR 3215 - Default judgment ...... 219

CPLR 3216 - Want of prosecution- neglect to proceed ...... 224 CPLR 3217- Voluntary discontinuance ...... 227 CPLR 3218 – Judgment by confession ...... 229 ARTICLE 34 - CALENDAR PRACTICE ...... 229 CPLR 3402 - Note of issue ...... 229 CPLR 3408 - Mandatory settlement conference in residential foreclosure action ...... 231 ARTICLE 41 - TRIAL BY JURY ...... 232 CPLR 4102 - Jury demand and waiver ...... 232 CPLR 4111 - General and specific verdicts and written interrogatories ...... 233 ARTICLE 42 - TRIAL BY THE COURT ...... 233 CPLR 4201 - Powers of referees to report ...... 233 CPLR 4213 - Decision of the court...... 234 ARTICLE 43 - TRIAL BY A REFEREE ...... 235 CPLR 4311 - Order of reference ...... 235 CPLR 4313 - Notice...... 235 CPLR 4319 - Decision ...... 235 ARTICLE 44 - TRIAL MOTIONS ...... 236 CPLR 4401 - Motion for judgment during trial ...... 236 CPLR 4404 - Post trial motions ...... 236 ARTICLE 45 - EVIDENCE ...... 241 CPLR 4503 - Attorney ...... 241 CPLR 4504- Doctor, dentist, podiatrist, chiropractor and nurse ...... 244 CPLR 4515 - Form of expert opinion ...... 244 CPLR 4518 - Business records ...... 247 CPLR 4545 - Admissibility of collateral source of payment ...... 249 CPLR 4547 - Compromise and offers to compromise...... 251 ARTICLE 50 - JUDGMENTS...... 252 CPLR 5001 - Interest to verdict, report or decision ...... 252 CPLR 5002 - Interest from verdict, report or decision to judgment ...... 253 CPLR 5003-a - Prompt payment following settlement...... 253 CPLR 5011 - Definition and content of judgment ...... 255 CPLR 5014 - Action upon judgment ...... 258 CPLR 5015 - Relief from judgment or order ...... 258 CPLR 5019 - Validity and correction of judgment or order ...... 265

ARTICLE 51 - ENFORCEMENT OF JUDGMENTS AND ORDERS GENERALLY ...... 266 CPLR 5104 - Enforcement of judgment or order by contempt ...... 266 ARTICLE 52 - ENFORCEMET OF MONEY JUDGMENTS ...... 267 CPLR 5225 - Payment or delivery of property of judgment debtor ...... 267 CPLR 5241 - Income execution for support enforcement ...... 267 ARTICLE 53 - RECOGNITION OF FOREIGN COUNTRY MONEY JUDGMENTS ...... 268 CPLR 5302 - Applicability ...... 268 CPLR 5304 - Grounds for non-recognition ...... 269 ARTICLE 55 - APPEALS GENERALLY ...... 269 CPLR 5501 - Scope of review ...... 269 CPLR 5511 - Permissible appellant and respondent...... 270 CPLR 5513 - Time to take appeal ...... 272 CPLR 5515 - Taking an appeal ...... 273 CPLR 5522 - Disposition of appeal ...... 273 CPLR 5526 - Content and form of record on appeal ...... 276 CPLR 5528 - Content of briefs and appendices ...... 276 ARTICLE 57- APPEALS TO THE APPELLATE DIVISION ...... 277 CPLR 5701 - Appeals to appellate division from supreme and county courts ...... 277 ARTICLE 62 - ATTACHMENT ...... 277 CPLR 6201 - Grounds for attachment ...... 277 CPLR 6212 - Motion papers ...... 278 ARTICLE 63 – INJUNCTION ...... 278 CPLR 6301 - Grounds for preliminary injunction and temporary restraining order ...... 278 CPLR 6312 - Motion papers ...... 279 ARTICLE 65 - NOTICE OF PENDENCY ...... 280 CPLR 6501 - Notice of pendency; constructive notice ...... 280 CPLR 6514 - Motion for cancellation of notice of pendency ...... 280 ARTICLE 75 - ARBITRATION ...... 281 CPLR 7501 - Effect of arbitration agreement ...... 281 CPLR 7503 - Application to compel or stay arbitration ...... 281 CPLR 7511- Vacating or modifying award ...... 283 CPLR 7513 - Fees and expenses ...... 284 ARTICLE 78 - PROCEEDING AGAINST BODY OR OFFICER ...... 284 CPLR 7801 - Nature of proceeding ...... 284

CPLR 7803 - Questions raised ...... 287 ARTICLE 83 - DISBURSEMENTS AND ADDITIONAL ALLOWANCES ...... 292 CPLR 8303-a - Frivolous claims ...... 292 ARTICLE 86 - COUNSEL FEES AND EXPENSES IN CERTAIN ACTIONS AGAINST THE STATE ...... 295 RECENT COMMERCIAL DIVISION RULES ...... 299

Table of 2018 CPLR Amendments

CPLR Section or Rule Amendment Effective Date NY CLS CPLR CPLR 214-a and 203(g) were amended to significantly alter the 1/31/2018 203(g)(2) and 214-a limitation period for claims alleging failure to diagnose cancer or a malignant tumor. CPLR 214-a was amended to provide that the two and a half year limitation period in cases alleging a failure to diagnose cancer or a malignant tumor, begins to run from the later of either (i) when the person knows or reasonably should have known of the alleged negligent act or omission and knows or reasonably should have known that it caused the injury, with a cap of seven years from the alleged act or omission, or (ii) the date of the last treatment, where there is continuous treatment for such injury, illness or condition. In addition, CPLR 203(g)(2) was added to apply to notices of claim and statutes of limitation for actions against the state (see Court of Claims Act § 10) and municipal defendants (see General Municipal Law § 50-e and § 50-i). It parallels the CPLR 214-a amendment. Includes revival provision.

NY CLS CPLR 214-b Amended to extend the expiration date for renewal of time 7/1/2018 barred Agent Orange claims to June 16, 2020.

NY CLS CPLR 2111 Amended to extending provisions of law relating to the use of 7/24/2018 electronic means for the commencement and filing of papers in certain actions or proceedings until September 1, 2019.

NY CLS CPLR 5003-b Added to provide that an employer (or its employee or officer) 7/11/2018 cannot include in a settlement agreement in connection with a sexual harassment claim, a nondisclosure agreement preventing the disclosure of the underlying facts and circumstances of the claim or action unless it is the plaintiff’s (settling individual’s) preference. In addition, the plaintiff must have 21 days to consider whether to accept the provision; and even after signing the agreement, the plaintiff has an additional seven days to revoke the agreement.

NY CLS CPLR 7515 Added to bar mandatory arbitration clauses in connection with 7/11/2018 sexual harassment claims, except where inconsistent with federal law. The mandatory arbitration clause concerns a provision in a written contract (1) requiring the submission of a matter to arbitration (as defined in CPLR Article 75) prior to bringing any legal action, and (2) providing that an arbitrator’s determination with respect to an alleged “unlawful discriminatory practice based on sexual harassment [is] final and not subject to independent court review.” If such provisions are

included, they will be deemed null and void. Where there is a conflict between provisions of this section and a collective bargaining agreement, the latter controls.

Table of 2017 CPLR Amendments

CPLR Section or Rule Amendment Effective Date

NY CLS CPLR § 503 Amended to authorize venue in "the county in which a substantial 10/23/2017 part of the events or omissions giving rise to the claim occurred."

NY CLS CPLR § 1101 Amended to extend the expiration dates for subsections (d) and 4/20/2017 (f) with respect to the waiver of the fee in certain cases and the fees for inmates to September 1, 2019.

NY CLS CPLR § 2111 Amended to extend the expiration date for subsection (b) 2-a to 7/24/2017 September 1, 2018.

NY CLS CPLR § 2112 Amended to eliminate present exclusions from mandatory e- 7/24/2017 filing in the Appellate Division.

NY CLS CPLR R 3408 Amended to add Para (a)(2) and clarify that Para (a)(1) shall not 4/20/2017 apply to a home loan secured by a reverse mortgage where the default was triggered by the death of the last surviving borrower unless (i) the last surviving borrower's spouse, if any, is a resident of the property subject to foreclosure, or (ii) the last surviving borrower's successor in interest, who was residing in the property when the last surviving borrower died, owns or has a claim to the ownership of the property subject to foreclosure. In addition, the amendment empowers the superintendent of financial services to promulgate rules as are necessary to implement these provisions.

NY CLS CPLR R 4518 Amended to provide that hospital records located in a jurisdiction 8/21/2017 other than New York State, may be admissible "by either a certification or authentication by the head of the hospital, laboratory, department or bureau of a municipal corporation or of the state or by an employee delegated for that purpose, or by a qualified physician."

NY CLS CPLR R 5521 Amended to reference Public Officers Law § 89(4)(d), relating 5/27/2017 to an order requiring disclosure of documents under the Freedom of Information law.

New Appellate Division Uniform Rules

A new set of Uniform Rules applicable to all four Departments of the Appellate Division (Practice Rules of the Appellate Division) will become effective on September 17, 2018. See 22 NYCRR Part 1250. In addition, each Department has enacted its own new set of supplemental rules. See 22 NYCRR Part 600 (First Department); Part 670 (Second Department); Part 850 (Third Department – its prior rules were in Part 800); and Part 1000 (Fourth Department). The new Practice Rules of the Appellate Division and individual Department rules are attached.

New E-Filing Rules Applicable to Appellate Division

Effective March 1, 2018, the four Departments of the Appellate Division have implemented electronic filing through NYSCEF with respect to certain appellate matters and original proceedings. See 22 NYCRR Part 1245 (attached). For now, the applicable actions covered – which differ from Department to Department – are as follows:

First Department: All appeals in commercial matters originating in Supreme Court, Bronx and New York Counties.

Second Department: All appeals in matters originating and electronically filed in Supreme and Surrogate’s Courts in Westchester County.

Third Department: All appeals in civil actions commenced by summons and complaint in Supreme Court originating in the Third Judicial District.

Fourth Department: All appeals in matters originating in, or transferred to, the Commercial Division of Supreme Court in the Fourth Judicial District.

The list of cases and case types will be increased in the coming months.

LAW OFFICES OF DAVID L. FERSTENDIG, LLC ATTORNEYS AT LAW 280 MADISON AVENUE, NEW YORK, NY 10016 TELEPHONE: 212-213-1233 FAX: 212-213-1221 EMAIL: [email protected] WWW.FERSTLAW.COM

CPLR UPDATE By: David L. Ferstendig

STATUTE OF LIMITATIONS

CPLR 201

CPLR 201 - Statute of Limitations versus Statute of Repose

Nestor v. Putney Twombly Hall & Hirson, LLP, 153 A.D.3d 840, 61 N.Y.S.3d 248 (2d Dep’t 2017) (“‘In New York, Statutes of Limitation are generally considered procedural because they are [v]iewed as pertaining to the remedy rather than the right’ (citation omitted). A statute of limitations ‘does not begin to run until a cause of action accrues’ (citation omitted). In contrast, ‘a statute of repose begins to run when the specified event or events takes place, regardless of whether a potential claim has accrued or, indeed, whether any injury has occurred’ (citation omitted). ‘The repose period serves as an absolute barrier that prevents a plaintiff’s right of action’ (citation omitted). ‘In other words, the period of repose has the effect of preventing what might otherwise have been a cause of action from ever arising’ (citation omitted). Statutes of repose ‘exhibit a substantive texture, nature and consequence that distinguishes them from ordinary limitation provisions’ (citation omitted). In Tanges, in distinguishing statutes of repose from statutes of limitations, the Court of Appeals noted that it had previously stated that ‘[i]f a statute creates a cause of action and attaches a time limit to its commencement, the time is an ingredient of the cause’ (citation omitted). In contrast, when a cause of action ‘was cognizable at common law or by other statute law, a statutory time limit is commonly taken as one of limitations and must be asserted by way of defense’ (citation omitted). California Code of Civil Procedure § 366.3(a) provides: ‘If a person has a claim that arises from a promise or agreement with a decedent to distribution from an estate or trust or under another instrument, whether the promise or agreement was made orally or in writing, an action to enforce the claim to distribution may be commenced within one year after the date of death, and the limitations period that would have been applicable does not apply’ (citation omitted). In applying this statute, California courts have referred to it as a statute of limitations (citations omitted). Here, contrary to the plaintiff’s contention, California Code of Civil Procedure § 366.3 is a statute of limitations, not a statute of repose. Unlike a statute of repose, section 366.3 begins to run at the time the cause of action to recover on the promise to make a testamentary disposition accrues, namely, the date of the promisor’s death (citations omitted). Moreover, California cases analyzing section 366.3 have termed this statute a statute of limitations, not a statute of repose, and in one case, the court found that a defense based on this statute of limitations had been waived because the executor of the estate had not pleaded it

(citations omitted). Although the California courts’ classification of section 366.3 is not dispositive, it ‘is instructive and should not be ignored’ (citation omitted). Thus, section 366.3 is a procedural statute of limitations, and it would not have applied to Christina’s claim against the decedent’s estate in New York. Since section 366.3 was inapplicable, the plaintiff would not ‘have prevailed on the underlying claim’ had the Putney defendants raised this defense (citation omitted).”).

CPLR 201 - Parties to an insurance contract may agree in writing to shorten the period of time in which to commence an action against an insurer for the nonpayment of claims

Mercedes-Benz Fin. Servs. USA, LLC v. Allstate Ins. Co., 2018 NY Slip Op 04064 (3d Dep’t 2018) (“While the statute of limitations period applicable to a breach of contract claim is ordinarily six years (citation omitted), parties to an insurance contract may agree in writing to shorten the period of time in which to commence an action against an insurer for the nonpayment of claims (citations omitted). Here, there is no dispute that the insurance policy shortened the period of time within which plaintiff had to commence this action. . . . However, the term ‘date of loss’ is not defined in the policy, and the parties disagree as to its meaning and, thus, when the one-year limitations period began to run. In particular, plaintiff contends that the ‘date of loss’ is the date on which defendant denied the insurance claim, thereby giving rise to its breach of contract claim. In contrast, defendant asserts that the ‘date of loss’ is the date on which the vehicle was stolen. We agree with plaintiff. . . . In view of the foregoing, we hold that the one-year limitations period set forth in the insurance policy began to run on the date that defendant denied the claim for coverage (citations omitted). In so holding, we decline to follow the conflicting line of cases cited by defendant in support of its assertion that the "date of loss" is the date of the underlying theft (citations omitted).”).

CPLR 201 - Agreement to shorten statute of limitations period- period of time within which to bring action should be fair and reasonable

D&S Restoration, Inc. v. Wenger Constr. Co., Inc., 160 A.D.3d 924, 75 N.Y.S.3d 505 (2d Dep’t 2018) (“‘[A]n agreement which modifies the Statute of Limitations by specifying a shorter, but reasonable, period within which to commence an action is enforceable’ (citations omitted). ‘[T]he period of time within which an action must be brought . . . should be fair and reasonable, in view of the circumstances of each particular case . . . The circumstances, not the time, must be the determining factor’ (citations omitted). There is nothing inherently unreasonable about the one- year period of limitation, to which the parties here freely agreed (citations omitted). ‘The problem with the limitation period in this case is not its duration, but its accrual date’ (citation omitted). It is neither fair nor reasonable to require that an action be commenced within one year from the date of the plaintiff's substantial completion of its work on the project, while imposing a condition precedent to the action that was not within the plaintiff's control and which was not met within the limitations period. ‘A limitation period' that expires before suit can be brought is not really a limitation period at all, but simply a nullification of the claim’ (citation omitted). The limitation period in the subcontract conflicts with the conditions precedent to payment becoming due to the plaintiff, which, under the circumstances of this case, acted to nullify any claim the plaintiff might have for breach of the subcontract. Therefore, interpreting the subcontract against the defendant,

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. which drafted the agreement (citations omitted), we find that the one-year limitation period is unenforceable under the circumstances here (citations omitted). Accordingly, the Supreme Court should not have granted that branch of the defendant's motion which was to dismiss the breach of contract cause of action as time-barred.”).

CPLR 202 - Borrowing Statute

CPLR 202 - Residence is where plaintiff allegedly sustained economic impact

Grinbaum v. Klisivitch, 146 A.D.3d 755, 756, 46 N.Y.S.3d 120, 121-122 (2d Dep’t 2017) (“Here, as the plaintiff resides in Quebec, Canada, and Quebec is the place where he allegedly sustained the economic impact of the loss, the action accrued in Quebec. It is undisputed that the applicable limitations period to commence the instant action is six years in New York, but only three years under Quebec law. Consequently, since this action was commenced more than three years after it accrued, it is untimely.”).

CPLR 202 - Borrowing statute

David L. Ferstendig, Court of Appeals Agrees That Contractual Choice-of-Law Provision Does Not Preclude Application of Borrowing Statute, 692 N.Y.S.L.D. 1-2 (2018).

Court of Appeals Agrees That Contractual Choice-of-Law Provision Does Not Preclude Application of Borrowing Statute

The Provision Reflected the Parties’ Intent to Apply New York’s Substantive and Procedural Law and CPLR 202 Is Part of That Procedural Law

In the November, 2016 edition of the Digest, we discussed the First Department’s decision in Ontario, Inc. v. Samsung C&T Corp., 144 A.D.3d 122 (1st Dep’t 2016). There, the court held that a broadly drawn contractual choice-of-law provision did not preclude the application of New York’s borrowing statute, contained in CPLR 202. It found that while the choice-of-law provision prohibited a conflict of law analysis, the borrowing statute was not a choice-of-law directive, but a statute of limitations. Here, we are dealing with the Court of Appeals’ affirmance. 2018 N.Y. Slip Op. 04274 (June 12, 2018).

As we previously noted, CPLR 202 provides that where a nonresident brings an action in New York with respect to a claim accruing outside of the state, the applicable statute of limitations is the lesser of New York’s limitation period and the limitation period where the cause of action accrued. The contractual choice-of-law provision here states in relevant part:

This Agreement shall be governed by, construed and enforced in accordance with the laws of the State of New York. You hereby irrevocably and unconditionally consent to submit to the exclusive jurisdiction of the courts of the State of New York and of the United States District Courts located in the County of New York for any lawsuits, actions or other proceedings arising out of or relating

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. to this Agreement and agree not to commence any such lawsuit, action or other proceeding except in such courts. (Emphasis added.)

It was undisputed that the plaintiff’s claims accrued in Ontario, that Ontario’s limitation period was two years, in contrast to the applicable New York six-year statute of limitations, and that if Ontario’s two-year period applied, the action was time-barred

The Court of Appeals noted that generally contractual choice-of-law provisions apply to substantive issues and statutes of limitations are procedural. In this case, however, the parties agreed with the Appellate Division’s finding that the contract should be interpreted to reflect the parties’ intent to apply both the substantive and procedural law of New York State to their dispute. The plaintiff argued that because the choice-of-law provision specifically stated that the contract would be "enforced" under New York law, it indicated the parties’ intent to apply New York’s procedural law except for its statutory choiceof-law provisions. The plaintiff claimed that CPLR 202 was such a statutory choice-of-law provision. The Court of Appeals rejected that argument, holding

that the mere addition of the word "enforced" to the NDA’s choice-of-law provision does not demonstrate the intent of the contracting parties to apply solely New York’s six-year statute of limitations in CPLR 213 (2) to the exclusion of CPLR 202. Rather, the parties have agreed that the use of the word "enforced" evinces the parties’ intent to apply New York’s procedural law. CPLR 202 is part of that procedural law, and the statute therefore applies here.

Id. at ∗1.

The Court distinguished the statutory choice-of-law provision it dealt with in Ministers & Missionaries Benefit Bd. v. Snow, 26 N.Y.3d 466 (2015), which it characterized as "a codification of a long-standing common-law conflict-of-laws principle" and CPLR 202, which "is in derogation of the long-standing common-law conflicts principle that the law of the forum applies to procedural issues such as the statute of limitations." Ontario, 2018 N.Y. Slip Op. 04274 at ∗1. Thus, it rejected the plaintiff’s plea "to broadly redefine a ‘statutory choice-of-law directive’ as any statute that may require the application of the law of another state." Id.

The Court also dismissed plaintiff’s argument that it was "irrational" to conclude that the parties intended CPLR 202 to apply:

As explained, the borrowing statute is a stable fixture of New York’s procedural law, of which these sophisticated commercial entities were presumably aware when they chose New York’s procedural law to govern their arrangement. Notably, the NDA was signed in 2008, several years before we decided Ministers and Missionaries and therefore before the phrase "statutory choice-of-law directive" entered our vocabulary. It is therefore reasonable to conclude that the parties may have intended for CPLR 202 to apply, perhaps for strategic reasons, or because they

did not think at the time that it was possible to contract around the application of statutes they believed to be statutory choice-of-law directives, or otherwise.

Id. at ∗1–2.

The Court stressed that while forum shopping was not a consideration in this case because the parties agreed contractually that New York was the exclusive forum, and forum shopping is a primary purpose of CPLR 202, it is not the statute’s only purpose. In fact, it also adds clarity and certainty to the law.

Because the parties did not expressly agree that New York’s six-year limitation period governed or that CPLR 202 did not apply, the Court had

no occasion to address whether enforcement of such a contractual provision would run afoul of CPLR 201 or General Obligations Law § 17-103, or would otherwise violate New York’s public policy against contractual extensions of the statute of limitations before accrual of the cause of action. We therefore express no opinion on that issue (citation omitted).

Id. at ∗2.

CPLR 202 - Borrowing statute applies despite New York contractual choice of law clause

All My Children’s Hosp., Inc. v. Citigroup Global Mkts., Inc., 151 A.D.3d 583, 59 N.Y.S.3d 7 (1st Dep’t 2017) (“The motion court was correct in utilizing New York’s borrowing statute, CPLR 202, and applying Florida’s shorter statute of limitations to plaintiff’s claims, despite the contractual choice-of-law provision pointing to New York law (citation omitted).”).

CPLR 202 - Borrowing statute

David L. Ferstendig, Court Holds that Cayman Islands Rule is Procedural in Nature, 686 N.Y.S.L.D 3 (2018).)

Court Holds That Cayman Islands Rule Is Procedural In Nature

Thus, Under Choice of Law Principles, It Did Not Apply To Derivative Action Brought In New York

The issue in Davis v. Scottish Re Group Ltd., 2017 N.Y. Slip Op. 08157 (November 20, 2017), was whether a particular Cayman Islands Rule was substantive and thus applied under choice of law principles to an action brought here.

Some basic principles first when analyzing choice of law issues. First, under New York common law principles, the forum’s procedural rules govern. Moreover, the law of the forum generally governs the determination as to whether a particular foreign law is procedural or substantive in

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. nature, although the foreign jurisdiction’s characterization of the law is instructive, but not dispositive. See Tanges v. Heidelberg N. Am., Inc., 93 N.Y.2d 48, 54 (1999).

Here, the plaintiff commenced an action asserting both direct and derivative claims against various defendants, including Scottish Re Group Limited (Scottish Re), a Cayman Islands company, formerly a reinsurer. Rule 12A, contained in Order 15 of the Cayman Islands Grand Court Rules 1995, provides that a plaintiff who brings a contested derivative action in the Cayman Islands is required to apply to the Cayman Islands Grand Court for leave to continue the action. The Rule is intended to avoid vexatious or unfounded litigation. If Rule 12A was determined to be substantive, then under choice of law principles, the plaintiff would be barred from bringing this action in New York (having failed to seek leave from the Cayman Islands Grand Court).

The parties agreed that Cayman Islands substantive law governed the merits of this action. Plaintiff argued Rule 12A was inapplicable because it

is a procedural rule governing the way in which the parties appear before the Cayman courts, what manner of evidence shall be presented and, should a court make a determination to grant the plaintiff leave to continue, the next steps to be taken toward ultimate resolution of a derivative action.

Davis, 2017 N.Y. Slip Op. 08157, at ∗3

The defendants countered that the rule is a "substantive ‘gatekeeper’ in derivative actions involving Cayman Island companies." Id. As a result, a plaintiff who files a derivative action anywhere in the world on behalf of a Cayman Islands-organized company is required to comply with Rule 12A and seek leave from the Cayman Islands Grand Court.

The Court first looked to the language of Rule 12A, which talks of derivative actions "commenced by writ," and states that an application to the Grand Court is required when the defendant has "given notice of intention to defend." The Court noted that these procedures are specific to Cayman Islands litigation; actions in New York are not commenced by writ, and the Grand Court rules have their own specific method for how a defendant acknowledges service of the writ. Thus, it concluded that Rule 12A was procedural and did not apply in New York courts. The Court added that there is no suggestion in the rule’s language that it applies to derivative actions brought on behalf of Cayman Island companies outside the Cayman Islands.

The Court here found that the defendant’s reliance on the Court’s decision in Tanges, supra, was misplaced. In Tanges, answering a certified question from the Second Circuit, the Court of Appeals applied a Connecticut limitation period in products liability actions "barring any action commenced later than 10 years from the date the defendant no longer had control of the injurycausing product." Tanges, 93 N.Y.2d at 54–55. In doing so, the Court found the limitation period to be a statute of repose, which is substantive in nature, as opposed to a statute of limitations, which is procedural:

In Tanges, we reasoned that statutes of limitation are generally treated as procedural in New York because they pertain "to the remedy rather than the right," meaning that when the allotted time period under the statute has expired, the plaintiff loses its remedy, although it continues to have the underlying right.

Statutes of limitation begin to run when a cause of action accrues. Statutes of repose are "theoretically and functionally" different. A statute of repose begins to run when a specified event takes place, and can expire before a possibly valid cause of action ever accrues. The repose period creates an "absolute barrier" to a plaintiff’s right of action. Given this potential impact on the right of a plaintiff to bring a cause of action, the Tanges Court held that repose statutes "exhibit a substantive texture, nature and consequence," different from regular statutes of limitation, and thus are substantive. In other words, unlike a statute of limitations, a statute of repose "envelop[es] both the right and the remedy (citations omitted)." Davis, 2017 N.Y. Slip Op. 08157, at ∗5.

The Court here stated that Rule 12A was not functionally similar to a statute of repose, since it did not nullify a plaintiff’s right to ever bring an action. Rather,

allows any plaintiff the right to commence a derivative action, and sets forth a procedural mechanism for a threshold determination of merits and standing. Certainly, if a plaintiff does not seek leave to continue, the rule creates an impregnable barrier to continuing the derivative action, forestalling any remedy, just as a statute of limitations forecloses a plaintiff who sleeps on its rights from obtaining a remedy. However, Rule 12A itself neither creates a right, nor defeats it. Rather, it is the initial decision by the Grand Court judge, made after an evaluation of the plaintiff’s complaint using the substantive law, along with the defendant’s evidence, that may terminate the action.

Id. at ∗5–6.

Finally, the Court maintained that the general policy considerations described in Tanges compelled the Court here to conclude that Rule 12A is procedural. Finding that Rule 12A is procedural does not impose a burden on either the New York or Cayman Islands courts. However, if the rule was determined to be substantive

it is unclear what procedural path a party seeking to bring a derivative action in New York on behalf of a Cayman company would follow to comply with Rule 12A. Must the party first proceed by writ in the Grand Court and then discontinue the Cayman action to return to, or commence its action here in New York? Would the ruling by the Grand Court that there was a sufficient showing of merit be binding on a New York court on a motion to dismiss or for summary judgment? Rule 12A provides no answers.

Id. at ∗6.

As a result, the Court concluded that plaintiff’s failure to first seek leave from the Cayman Islands Grand Court did not bar his derivative claims here.

CPLR 202 - Borrowing statute - where alleged injury is economic, accrual is in state where plaintiff resides and sustains the economic impact of the loss

Centre Lane Partners, LLC v. Skadden, Arps, Slate, Meagher, & Flom LLP, 154 A.D.3d 525, 62 N.Y.S.3d 341 (1st Dep’t 2017) (“Where the alleged injury is economic in nature, the cause of action is generally deemed to accrue in the state ‘where the plaintiff resides and sustains the economic impact of the loss’ (citations omitted). Here, the debtors’ principal places of business are in Oregon, and their financial losses were allegedly incurred in that state. Contrary to plaintiffs’ claim, the motion court’s application of Oregon’s two-year statute of limitations via New York’s borrowing statute (CPLR 202) in light of, inter alia, the situs of debtors’ Oregon-based businesses, the legal relationships existing between plaintiffs, debtors and defendants, and the nature of the instant action, was proper and the result would not be ‘absurd,’ notwithstanding defendants’ place of business being located in New York (citations omitted). . . . Given such factual pleadings, the motion court properly rejected plaintiffs’ argument that Oregon’s discovery/tolling rule for legal malpractice claims rendered this malpractice action timely commenced. The court properly concluded that a reasonable person, knowing the facts that the debtors had available to them at the time of the two challenged transfers, should have been aware of a substantial possibility of defendants’ conflicted representation, as well as the harm that such negligent representation had caused, and such knowledge could not have been gained later than when the debtors filed for Chapter 7 bankruptcy on December 31, 2013 (citation omitted).”).

CPLR 202 - Borrowing statute –where was injury/economic impact?

Deutsche Bank Natl. Trust Co. v. Barclays Bank PLC, 156 A.D.3d 401, 66 N.Y.S.3d 472 (1st Dep’t 2017) (“Plaintiff, a California domiciliary, argues that the plaintiff-residence rule of Global Financial — a case in which the plaintiff was a corporation suing to recover for an injury to itself — should not be applied here, where plaintiff is suing solely in its capacity as trustee of the subject trusts. Rather, plaintiff argues that we should apply the multi-factor test used in Maiden v. Biehl (582 F. Supp 1209 [SD NY 1984]), which also dealt with a trustee-plaintiff, to determine where the injury occurred. However, we need not decide whether the plaintiff-residence rule or the multi- factor test applies in this context because, even under the multi-factor test, we find that the injury/economic impact was felt in California and the claims are thus deemed to have accrued there. Initially, it is undisputed that the domiciles of the trust beneficiaries, which are in various jurisdictions, do not provide a workable basis for determining the place of accrual. As to the New York choice-of-law clauses of the relevant agreements, because these provisions do not expressly incorporate the New York statute of limitations, they ‘cannot be read to encompass that limitation period’ (citation omitted). By contrast, the subject trust in each action comprises a pool of mortgage loans, originated by California lenders and encumbering California properties, either exclusively (in the Barclays case) or predominantly (in the HSBC case), and, as previously discussed, administered in California by plaintiff, a California-based trustee. Further, it is undisputed that the relevant pooling and servicing agreement (PSA) for each trust contemplates the payment of state taxes, if any, in California. To the extent the physical location of the notes

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. memorializing the securitized mortgage loans has relevance to the analysis, each trust’s PSA contemplates that the notes may be maintained in California, but neither contemplates maintaining the notes in New York.”).

Relation Back

CPLR 203(b) - Relation doctrine not applicable because there was no unity of interest

Belair Care Ctr., Inc. v. Cool Insuring Agency, Inc., 61 A.D.3d 1263 (3d Dep’t 2018) (“Plaintiffs failed to establish the second prong of the relation back doctrine. ‘Unity of interest requires a showing that the judgment will similarly affect the proposed defendant, and that the new and original defendants are vicariously liable for the acts of the other’ (citations omitted). The proposed amended complaint alleges that Treiber — like all brokers — engaged in a cooperative strategy with CRM to market the trust; however, it contains no allegations that there was a jural, or legal, relationship between Treiber and CRM that would make either vicariously liable for the acts of the other. Thus, Supreme Court properly denied plaintiffs leave to amend the complaint to assert a negligence cause of action against Treiber.”).

Jones v. Seneca County, 154 A.D.3d 1349, 63 N.Y.S.3d 620 (4th Dep’t 2017) (“Contrary to plaintiff’s further contention, we conclude that the court properly denied her motion seeking leave to amend her complaint to add respondent as a defendant. Plaintiff failed to establish that respondent and defendant are united in interest, and thus plaintiff is not entitled to the benefit of the relation back doctrine (citations omitted). Here, respondent and defendant are not united in interest inasmuch as defendant cannot be held vicariously liable for the acts of its Sheriff’s deputies (citations omitted). In view of our determination, we do not address the alternative ground upon which the court denied the motion.”).

Thomas v. City of New York, 154 A.D.3d 417, 62 N.Y.S.3d 97 (1st Dep’t 2017) (“Substitution of Crockwell via the relation back doctrine is also improper because Crockwell is not ‘united in interest’ with the City of New York, the original defendant (CPLR 203[b]). The City cannot be held vicariously liable for its employees’ violations of 42 USC § 1983, and there is no unity of interest in the absence of a relationship giving rise to such vicarious liability (citation omitted). Nor can plaintiff demonstrate that, but for an excusable mistake as to the proper parties’ identities, he would have brought the action against Crockwell, since he knew before the statute of limitations expired that Crockwell was the arresting officer (citation omitted).”).

CPLR 203(c) - Relation back- because prior action was dismissed, there was no amended pleading CPLR 205(a): Prior action dismissed on the merits, so CPLR 205(a) does not apply

Moran v. JRM Contr., Inc., 145 A.D.3d 1584, 43 N.Y.S.3d 828 (4th Dep’t 2016) (“Defendant established that the action was commenced more than six years after the breach of contract cause

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. of action accrued and was therefore time-barred (citations omitted). Contrary to plaintiff’s contention, the relation back doctrine does not apply herein (see CPLR 203 [b]). ‘[T]he relation back doctrine allows a claim asserted against a defendant in an amended filing to relate back to claims previously asserted against a codefendant for [s]tatute of [l]imitations purposes where the two defendants are united in interest’ (citation omitted). Here, inasmuch as the prior action was dismissed, there was no amended pleading (citations omitted) and, moreover, Madalena was not a codefendant (citations omitted). Contrary to plaintiff’s further contention, CPLR 205 (a) also does not apply herein inasmuch as the prior action was dismissed on the merits (citations omitted). Contrary to the determination of the court, the relation back doctrine cannot be ‘bootstrapped onto CPLR 205 (a).’”).

CPLR 203(c) - Parties united in interest – failure to sue defendant initially was not mistake

Branch v. Community Coll. of the County of Sullivan, 148 A.D.3d 1410, 48 N.Y.S.3d 861 (3d Dep’t 2017) (“The first prong of that test was indisputably met. Assuming without deciding that the second was as well, the third was not in that plaintiff’s failure to timely commence an action against defendant ‘was not the result of a mistake or an inability to identify the correct defendant within the applicable limitations period’ (citation omitted). Plaintiff was well aware that defendant maintained the dormitory where decedent died and, in December 2007, the notice of claim she served upon the County (and additionally mailed to defendant) stated as much. She nevertheless elected to commence an action against the County alone in the belief that defendant ‘was a department of the County.’ Defendant is not, and a failure to appreciate that defendant was a legally required party is not the type of mistake contemplated by the relation back doctrine (citations omitted). Plaintiff accordingly failed to demonstrate that the relation back doctrine applied and, thus, Supreme Court properly dismissed the complaint as time-barred.”).

CPLR 203(c) - Relation back - intentional decision not to name proposed defendant is not a mistake

Ahrorgulova v. Mann, 144 A.D.3d 953, 42 N.Y.S.3d 203 (2d Dep’t 2016) (“The plaintiff’s intentional decision not to name Perl as a defendant in the original complaint, even though she performed the subject medical procedure, cannot be viewed as the kind of inadvertent mistake as would trigger the application of the relation-back doctrine (citation omitted).”).

CPLR 203(c) - Relation back-Proceeding was not commenced by real party in interest

Risk Control Assoc. Ins. Group v. Maloof, Lebowitz, Connahan & Oleske, P.C., 151 A.D.3d 527, 57 N.Y.S.3d 139 (1st Dep’t 2017) (“National Specialty’s claims are time-barred by the three-year statute of limitations applicable to nonmedical malpractice actions, whether sounding in breach of contract or tort (citations omitted). Plaintiff’s argument, that leave to amend to substitute new parties, related to the original parties, should not be precluded as time-barred so long as the earlier pleading gave the adverse party sufficient notice of the transaction out of which the new claim arises (citation omitted), is unavailing in these circumstances, as the proceeding was not commenced by the real party in interest, and the amendment to add the proper party was time- barred.”).

CPLR 203(d) - “Untimely” counterclaims and third-party causes of actions can be asserted as offset if they arise out of the same transactions and occurrences upon which the complaint depends

Lewis, Brisbois, Bisgaard & Smith, LLP v. Law Firm of Howard Mann, 141 A.D.3d 574, 35 N.Y.S.3d 267 (2d Dep’t 2016) (“The Supreme Court properly denied those branches of the motion of the plaintiff and the third-party defendants (hereinafter collectively the appellants) which were pursuant to CPLR 3211(a)(5) to dismiss, as time-barred, the second, fourth, fifth, sixth, and eighth counterclaims, as well as the first and third causes of action in the third-party complaint, all of which allege legal malpractice, breach of contract, or breach of fiduciary duty, as well as the ninth counterclaim and the fourth cause of action in the third-party complaint, which allege a violation of Judiciary Law § 487.”[C]laims and defenses that arise out of the same transaction as a claim asserted in the complaint are not barred by the Statute of Limitations, even though an independent action by defendant might have been time-barred at the time the action was commenced” (citations omitted). In the instant matter, the subject counterclaims and third-party causes of action all arise from the transactions and occurrences upon which the complaint depends. Accordingly, they are not time-barred to the extent of the demand in the complaint (see CPLR 203[d]). Since the appellants’ motion did not address the applicability of CPLR 203(d), the appellants did not establish their entitlement to dismissal pursuant to CPLR 3211(a)(5).”).

CPLR 203(d) - Otherwise untimely defense or counterclaim is not barred, and may be asserted as an offset only

Matter of Jenkins v. Astorino, 155 A.D.3d 733, 64 N.Y.S.3d 285 (2d Dep’t 2017) (“The language of CPLR 203(d) is based on the equitable doctrine of recoupment (citation omitted). By the plain language of the statute, an otherwise untimely defense or counterclaim is ‘not barred’ only ‘to the extent of the demand in the complaint’ (citation omitted). Accordingly, CPLR 203(d) does not permit a defendant to obtain affirmative relief by way of a counterclaim (citations omitted). . . . Contrary to the Supreme Court’s conclusion, the defendants’ answer does not seek any affirmative relief. Rather, it raises a defense that is ‘predicated on [an] act or fact growing out of the matter constituting the cause or ground of the action brought’ by the plaintiffs (citation omitted). In other words, the assertion that the Local Law was not validly enacted in accordance with the applicable referendum procedures specified in state and local law ‘arises from, and directly relates to’ the plaintiffs’ claim that the Local Law was, in fact, enacted in accordance with the applicable referendum procedures and that they were therefore entitled to a declaration that the Local Law was valid (citations omitted). Accordingly, the court erred when it, in effect, dismissed the affirmative defense contained in the defendants’ answer alleging that the Local Law was not validly enacted on the ground that the affirmative defense was time-barred (citation omitted). Since the merits of the defendants’ affirmative defense were not reached by the court, it should not have awarded judgment in favor of the plaintiffs.”).

CPLR 203(d) - Asserting untimely counterclaims as offset

California Capital Equity, LLC v. IJKG, LLC, 151 A.D.3d 650, 54 N.Y.S.3d 578 (1st Dep’t 2017) (“At this, the pleading stage, however, we cannot conclude that the counterclaim does not arises out of the same series of transactions that forms the basis of, and is not sufficiently related to, the cause of action for breach of the tax distribution provisions of the Note Agreement (citations omitted). If proved, the counterclaim could be used defensively as a shield for recoupment purposes, but IJKG could not obtain any affirmative relief, such as disgorgement (citations omitted). Therefore, IJKG can assert its otherwise untimely counterclaim solely to offset any damage award or deficiency judgment that plaintiff may obtain in its favor against IJKG (citations omitted).”).

CPLR 203(d) - Untimely counterclaim did not arise out of same transactions or occurrences upon which claim in complaint depends; so cannot be used as offset CPLR 214(2): 3 year statute of limitations for action to recover upon a liability created or imposed by statute

Town of N. Hempstead v. County of Nassau, 149 A.D.3d 1134, 54 N.Y.S.3d 19 (2d Dep’t 2017) (“Contrary to the defendants’ contention, the Supreme Court properly determined that their common-law right of setoff cannot be exercised to recover upon claims that are time-barred (citations omitted). Pursuant to CPLR 214(2), an action to recover upon a liability created or imposed by statute must be commenced within three years from the time the cause of action accrued. As the court correctly determined, the County’s obligation to pay FIT tuition, and its right to seek reimbursement from the Town, were created by statute, i.e., Education Law § 6305(2) and (5). Since the County’s right to seek reimbursement from the Town was created by statute, and did not exist at common law, such an action would be governed by the three-year statute of limitations set forth in CPLR 214(2). Pursuant to CPLR 203(d), a time-barred claim may be used to set off another claim only to the extent that the two claims arise from the same incident or transaction (citations omitted). Here, however, the chargebacks sought by the County are unrelated to the sales tax revenue owed by the County to the Town, and therefore, the County is barred from asserting a right of setoff as a defense (citation omitted), since its claims are time-barred under CPLR 214(2).”).

CPLR 203(d) - No offset for “untimely” counterclaim because alleged legal malpractice did not arise from transactions sued upon

Verkowitz v. Ursprung, 153 A.D.3d 1443, 61 N.Y.S.3d 336 (2d Dep’t 2017) (“The defendant was properly precluded from seeking equitable recoupment pursuant to CPLR 203(d) based on the time-barred counterclaim and affirmative defense, as the legal malpractice that allegedly occurred in the divorce action did not arise from the transaction sued upon, which involved the defendant’s alleged failure to pay the plaintiff’s legal fees in the subsequent litigation involving the estate of the defendant’s former husband (citation omitted).”).

CPLR 203(d) / 203(f) - Underlying action was dismissed in defendants' favor more than one year before defendants moved for leave to amend counterclaim; leave to amend denied and CPLR 203(d) does not apply

People's Capital & Leasing Corp. v. 1 800 Postcards, Inc., 2018 NY Slip Op 04651 (1st Dep’t 2018) (“We affirm the denial of defendants’ motion for leave to amend. While malicious prosecution claims can be premised on civil proceedings (citations omitted), the proposed malicious prosecution counterclaim is time-barred. The underlying action was dismissed in defendants' favor more than one year before defendants moved for leave to amend (citation omitted). Contrary to defendants’ arguments, under the circumstances of this case, neither CPLR 203(d) nor CPLR 203(f) avails them. The proposed counterclaim fails, moreover, due to defendants' failure to adequately allege special damages (citation omitted).”).

CPLR 203(f) - Amendment to add crossclaim granted, even though it added new theory of recovery, because it arose out of the same occurrence set forth in the original pleadings

Taylor v. Deubell, 153 A.D.3d 1662, 60 N.Y.S.3d 739 (4th Dep’t 2017) (After liability trial, defendant sought leave to amend answer to add additional cross-claims against co-defendant for property damage and loss of use of bus. “The determination whether to grant leave to amend a pleading rests within the court’s sound discretion and will not be disturbed absent a clear abuse of that discretion (citation omitted), and we conclude that the court did not abuse its discretion here. Although the amended answer added a new theory of recovery against Masters Edge, it arose out of the same occurrence set forth in the original pleadings, i.e., a motor vehicle accident allegedly caused by the negligence of Masters Edge (citations omitted).”).

CPLR 203(f) - Relation-back doctrine did not apply because “[t]he allegations of the original complaint, which were limited to claims that the plaintiff was falsely arrested and imprisoned while lawfully present at certain premises, failed to give notice of transactions or occurrences to be proven with respect to the proposed cause of action for malicious prosecution.”

Martin v. City of New York, 153 A.D.3d 693, 61 N.Y.S.3d 63 (2d Dep’t 2017) (“The Supreme Court also providently exercised its discretion in declining to permit the plaintiff to amend the complaint to add a cause of action alleging malicious prosecution. As the plaintiff correctly concedes, the statute of limitations for asserting that cause of action has expired. ‘The relation- back doctrine permits a plaintiff to interpose a claim or cause of action which would otherwise be time-barred, where the allegations of the original complaint gave notice of the transactions or occurrences to be proven and the cause of action would have been timely interposed if asserted in the original complaint’ (citations omitted). However, the allegations of the original complaint, which were limited to claims that the plaintiff was falsely arrested and imprisoned while lawfully present at certain premises, failed to give notice of transactions or occurrences to be proven with respect to the proposed cause of action for malicious prosecution. In particular, the original complaint failed to provide the defendant with notice of the need to defend against allegations that the defendant commenced or continued the underlying criminal proceeding, such as by supplying the prosecutor with falsified evidence (citation omitted).”).

CPLR 203(f) - Majority and dissent disagree as to whether the original timely pleading alleging gender discrimination gave notice of occurrence plaintiff seeks to prove in amended (otherwise untimely) pleading alleging discrimination on the basis of sexual orientation

O’Halloran v. Metropolitan Transp. Auth., 154 A.D.3d 83, 60 N.Y.S.3d 128 (1st Dep’t 2017) (“Compare majority: The narrow issue on appeal is whether the motion court providently permitted plaintiff to amend her complaint to include belated claims of discrimination on the basis of sexual orientation on the ground that those claims related back to the original pleading, which timely alleged, inter alia, discrimination on the basis of gender. We hold that it did, because the original pleading gave defendants notice of the occurrences plaintiff seeks to prove pursuant to her amended complaint (see CPLR 203[f]), and defendants will not suffer undue prejudice as a result of the delay (see CPLR 3025[b]).”; and dissent: “With regard to whether the relation-back exception to the timeliness requirement is applicable in this case, while the original complaint included factual allegations in support of its claims of gender and disability discrimination, as well as retaliation, it contained no factual allegations as to any transactions or occurrences attributed by plaintiff to discrimination on the basis of sexual orientation. Indeed, although plaintiff filed a series of complaints both within her own agency and with administrative agencies and courts on both the federal and state level, she never asserted a claim of sexual orientation discrimination in any of those complaints. Neither does the record reveal any mention by her of sexual orientation discrimination in two days of deposition testimony. Thus, defendants were provided with no notice of any transactions or occurrences that plaintiff intended to use to prove the sexual orientation discrimination claims she now seeks to add by way of her proposed amended complaint. In any event, even actual notice of a potential sexual orientation claim would not suffice to permit plaintiff to invoke the relation-back doctrine, because notice of the potential claim, including the conduct with which defendants would be charged in the new claim, must be provided in the original pleading itself (citations omitted).”).

CPLR 204 Stay

CPLR 204(b) - Toll runs from time demand for arbitration served until final determination of non arbitrability

Board of Educ. of Palmyra-Macedon Cent. Sch. Dist. v. Flower City Glass Co., Inc., 160 A.D.3d 1497, 75 N.Y.S.3d 735 (4th Dep’t 2018) (“We also reject the contention of the Flower City defendants that they met their burden of proof on their motion by establishing that the District made the demand for arbitration in bad faith (citation omitted). We therefore conclude that the CPLR 204 (b) toll applied from the time the demand for arbitration was served, on September 30, 2014, until the final determination of nonarbitrability by the court on June 5, 2016. In addition, for the same reasons that the claim for arbitration did not accrue until the architect certified ‘Substantial Completion’ of the work on October 1, 2008, we conclude that the breach of contract cause of action did not accrue until October 1, 2008. Applying the CPLR 204 (b) toll, we further conclude that the District timely commenced the breach of contract cause of action in appeal No. 2 on September 11, 2015.”).

CPLR 205(a) - Six Month Extension

CPLR 205(a) - Termination of action, 6-month extension; applies to actions and special proceedings; dismissal of prior proceeding by being marked off calendar is not dismissal on the merits

Matter of Lindenwood Cut Rate Liquors, Ltd. v. New York State Liq. Auth., 161 A.D.3d 1077 (2d Dep’t 2018) (“As the petitioner correctly contends, CPLR 205(a) applies not only to actions but also to special proceedings under CPLR article 78 (citations omitted). The toll of CPLR 205(a) would not apply, however, if the prior proceeding was dismissed on the merits; thus, the court must determine whether the order dismissing the prior proceeding is entitled to res judicata effect (citation omitted). Here, the prior proceeding was dismissed after being marked off the calendar. Contrary to the Authority’s contention, ‘[a] dismissal of an action by being marked off the Trial Calendar is not a dismissal on the merits,’ and ‘[a] new action on the same theory is therefore not barred by the doctrine of res judicata’ (citations omitted). Moreover, there is nothing in the order denying the petitioner’s motion to restore the prior proceeding to the calendar which suggests that the prior proceeding was dismissed with prejudice (citation omitted).”).

CPLR 205(a) - Termination of action, 6 month extension; sua sponte dismissal of first action was not due to neglect to prosecute because order did not set forth any specific conduct that demonstrated a general pattern of delay; court splits on whether plaintiff’s second action was timely and that rested on determining when the first action was “terminated” for the purposes of CPLR 205(a)

Bank of N.Y. Mellon v. Slavin, 156 A.D.3d 1073, 67 N.Y.S.3d 328 (2d Dep’t 2017), (the first foreclosure action was dismissed in January 2013 as a result of plaintiff’s failure to appear at a mandatory conference. The trial court twice denied plaintiff’s motion to vacate the dismissal, and in July 2015, the Appellate Division affirmed. In August 2015, plaintiff brought a second foreclosure action against the defendant, among others. The Appellate Division was unanimous in finding that the sua sponte dismissal of the first action was not due to a neglect to prosecute because the order did not set forth any specific conduct that demonstrated a general pattern of delay. However, the court split on whether plaintiff’s second action was timely and that rested on determining when the first action was “terminated” for the purposes of CPLR 205(a). In finding the second action timely, the majority found that because the trial court’s sua sponte dismissal gave rise to a motion to vacate and an appeal from the order deciding that motion, the January 2013 order did not terminate the action. The dissent maintained that that the first action was terminated upon the January, 2013 dismissal. It asserted that prior case law in this area mandated that conclusion.).

CPLR 205(a) - Applied even though plaintiffs in first and second actions were different

David L. Ferstendig, Majority of Second Department Holds That CPLR 205(a) Applies Even Where Plaintiffs in First and Second Actions Are Different, 677 N.Y.S.L.D. 3-4 (2017).

Majority of Second Department Holds That CPLR 205(a) Applies Even Where Plaintiffs in First and Second Actions Are Different

Finds Plaintiffs Sought to Enforce the Very Same Right

We have referred to CPLR 205(a) on several occasions in the past, most recently in the July 2016 Law Digest. As you may recall, CPLR 205(a) provides that if an action is timely commenced and is terminated in a manner other than that prescribed by the statute (for example, a dismissal for neglect to prosecute the action), the plaintiff can commence a second action upon the same transactions or occurrences or series of transactions or occurrences within six months after termination of the first action. Service upon the defendant(s) must also be effected within that six- month period.

Wells Fargo Bank, N.A. v. Eitani, 47 N.Y.S.3d 80 (2d Dep’t 2017), is a mortgage foreclosure action. The first action was commenced by Argent Mortgage Company, LLC (“Argent”); however, during the course of the action, Argent assigned and delivered the adjustable rate note and mortgage to Wells Fargo Bank, N.A., as trustee (“Wells Fargo”). In addition, the defendant Eitani conveyed by deed to the defendant-appellant David Cohen the subject property while the action was pending. Almost eight years after the first action was commenced, the Administrative Judge, “on a routine clearing of the docket,” issued an order dismissing the action “as abandoned pursuant to CPLR 3215(c), without costs or prejudice.” Id. at 82. The handwritten caption on the form order still noted Argent as the plaintiff, even though Argent had divested itself of the note and mortgage to Wells Fargo more than five years earlier.

Within four months of the dismissal, Wells Fargo commenced this action and served the defendant pursuant to CPLR 205(a). The questions presented were (1) whether the ministerial dismissal of the first action fell under the neglect to prosecute exclusion, and (2) if the plaintiff in this action, Wells Fargo, could take advantage of CPLR 205(a), even though it was not the named plaintiff in the first action.

The Second Department unanimously agreed that the ministerial dismissal of the first action without prejudice was not “a neglect to prosecute” under the statute. The majority stated that the order tracked the language of CPLR 3215(c) (not CPLR 3216), stating that the plaintiff had failed to proceed to enter a judgment within one year of the default, and that the “[t]ime spent prior to discharge from a mandatory settlement conference [was not] computed in calculating the one year period.” Id. at 84. In addition, the order did not comply with CPLR 205(a)’s requirement, added via a 2008 amendment, that where the dismissal is for a neglect to prosecute, “the judge shall set forth on the record the specific conduct constituting the neglect, which conduct shall demonstrate a general pattern of delay in proceeding with the litigation.” Id. at 89.

The second issue, which the majority characterized as “more novel,” split the court. The majority focused on the fact that Argent had transferred the note and mortgage to Wells Fargo and recorded the assignment during the pendency of the first action. As a result,

Wells Fargo became Argent’s successor in interest with respect to the right to foreclose under the note and mortgage (citations omitted). As the assignee of the mortgage, Wells Fargo had a statutory right, pursuant to CPLR 1018, to continue the prior action in Argent’s place, even in the absence of a formal substitution (citations omitted). Since, by virtue of CPLR 1018, the prior action could have been continued by Argent’s successor in interest, Wells Fargo was, in actuality, the true party plaintiff in the prior action, and is entitled to the benefit of CPLR 205(a).

Id. at 84.

The majority also referred to the Court of Appeals’ recent reaffirmation that CPLR 205(a)’s “broad and liberal purpose is not to be frittered away by any narrow construction.” Id. at 85 (citing to Malay v. City of Syracuse, 25 N.Y.3d at 327). It distinguished the decision in Reliance Ins. Co. v. PolyVision Corp., 9 N.Y.3d 52 (2007), where the Court of Appeals stated that, outside of the representative context (that is, an executor or administrator, if the plaintiff dies), it had not previously read “‘the plaintiff’ to include an individual or entity other than the original plaintiff.” 9 N.Y.3d at 57. However, in Reliance, the corporate affiliates involved in the two actions sought to enforce different interests. Here, as noted above, the majority found that after assignment of the loan and mortgage, Wells Fargo became Argent’s successor in interest during the pendency of the first action. Moreover, both Argent and Wells Fargo sought to enforce the same right to foreclose on the subject property based on the same default on the subject note and mortgage. Thus, this case “may be a rare circumstance in which dismissal of a prior action commenced by a different party plaintiff justifies application of CPLR 205(a) to recommencement by a successor in interest to the prior plaintiff.” Wells Fargo Bank at 86. The majority concluded that its decision was consistent with CPLR 205(a)’s intended purpose to remedy a timely action terminated for a technical defect.

The dissent asserted that CPLR 205(a) cannot apply where the second action is commenced by a plaintiff other than the one that brought the first action. It found that, just as in Reliance, here the entities are not the same, “Wells Fargo is not Argent in a different capacity,” and Wells Fargo is not seeking to vindicate Argent’s rights in this action. Moreover, “Wells Fargo is not continuing Argent’s action in Argent’s name, and Wells Fargo was not substituted for Argent in that action.” Id. at 91.

CPLR 205(a) - No valid pre-existing action to relate back to

U.S. Bank Natl. Assn. v. DLJ Mtge. Capital, Inc., 141 A.D.3d 431, 35 N.Y.S.3d 82 (1st Dep’t 2016) (“Although the Trustee commenced this action within the applicable statute of limitations, it did not meet the condition precedent to enforcement of defendant DLJ Mortgage Capital, Inc.’s secondary ‘backstop’ repurchase obligation, which required that the Trustee first provide notice of the alleged breaches to defendant Ameriquest Mortgage Company, and allow a 90-day cure period to expire. Under these circumstances, the Trustee’s timely claims were properly dismissed without

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. prejudice to refiling pursuant to CPLR 205(a) (citations omitted)…Generally, actions dismissed on standing grounds may be refiled pursuant to CPLR 205(citation omitted). However, here, the Trustee is not entitled to refile the claims under CPLR 205(a), because it is not a “plaintiff” under that statute (citations omitted) to save its refiled claims, because there was no “valid preexisting action” to relate back to (citations omitted). Because the Trustee cannot benefit from either CPLR 203(f) or 205(a), the refiled claims are time-barred on standing grounds.”).

CPLR 205(a) - Does not apply because out of state action is not “prior” action

Deadco Petroleum v. Trafigura AG, 151 A.D.3d 547, 58 N.Y.S.3d 16 (1st Dep’t 2017) (“While the California action was timely commenced, the tolling provision of CPLR 205(a) does not avail plaintiff, because an out-of-state action is not a ‘prior action’ within the meaning of that provision (citations omitted).”).

CPLR 205(a) - Does not apply where prior action was dismissed for neglect to prosecute

Familio v. Hersh, 150 A.D.3d 1203, 52 N.Y.S.3d 901 (2d Dep’t 2017) (“The Supreme Court properly directed the dismissal of the complaint as time-barred on the ground that the provisions of CPLR 205(a) that toll the statute of limitations are inapplicable in this action because the plaintiff’s prior action had been dismissed for neglect to prosecute (citations omitted). Contrary to the plaintiff’s contention, under the circumstances of this case, the record of the dismissal of the prior action set forth the specific conduct constituting the neglect to prosecute, which conduct demonstrated a general pattern of delay (citations omitted).”).

CPLR 205(a) - Does not apply where prior action dismissed for lack of personal jurisdiction

Matter of Littlejohn v. New York State Dept. of Corr. & Community Supervision, 150 A.D.3d 1523, 55 N.Y.S.3d 775 (3d Dep’t 2017) (“The record demonstrates that petitioner, who was aware in March 2015 that his application to participate in the shock incarceration program was denied, did not commence this CPLR article 78 proceeding within the applicable four-month statutory time period (citations omitted). Although petitioner timely filed a petition by order to show cause in Dutchess County, that proceeding was dismissed for lack of personal jurisdiction and, thus, the tolling provisions of CPLR 205 (a) are inapplicable.”).

CPLR 205(a) - Commencement within six months after reconsideration decision is timely

Arty v. New York City Health & Hosps. Corp., 148 A.D.3d 407, 48 N.Y.S.3d 388 (1st Dep’t 2017) (“The District Court’s August 18, 2014 order granted reconsideration to the extent of designating the dismissal of plaintiff’s NYCHRL claim to be without prejudice, so that plaintiff could recommence an action, including that claim, within six months under CPLR 205(a) (citation omitted). Additionally, after the motion for reconsideration was decided, plaintiff could have pursued an appeal as of right, and the prior federal action then would not have ‘terminated’ for purposes of CPLR 205(a) until the appeal was exhausted by either a determination on the merits or dismissal (citation omitted). Instead, plaintiff properly commenced an action in state court, asserting a discrimination claim under the NYCHRL and a defamation claim within six months

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. after the reconsideration decision, which is timely under CPLR 205(a). Plaintiff was not required to commence a defamation action in state court while the reconsideration motion was pending, or to file a notice of appeal in federal court, in order to gain the benefit of the six-month extension (citation omitted); were our decision otherwise, the result would waste judicial resources by forcing a party to commence either a federal appeal or a new state court action while his or her case was still ongoing in federal court.”).

CPLR 205(a) - Prior action terminated upon issuance of Second Circuit order

Fischer v. City of New York, 147 A.D.3d 1030, 48 N.Y.S.3d 247 (2d Dep’t 2017) (First federal court action dismissed by district court followed by Second Circuit affirmance; “Contrary to the plaintiff’s contention, the Supreme Court properly determined that for the purposes of CPLR 205(a), the plaintiff’s prior, federal action terminated upon issuance of the Second Circuit’s order in May 2013 (citations omitted). Thereafter, the plaintiff had six months to commence a new action, and she did not do so. The instant action was not commenced until June 17, 2014.”).

CPLR 207- Absence Toll

CPLR 207 - Absence toll did not apply

Schwartz v. Chan, 75 N.Y.S.3d 31 (1st Dep’t 2018) (“Plaintiff's claims are time-barred since they were brought more than a year after the allegedly offending statements were published (citation omitted). Plaintiff argues, for the first time on appeal, that his time to commence the action was tolled by CPLR 207. This argument is unpreserved and in any event unavailing, since plaintiff failed to show that jurisdiction over defendant could not be obtained without personal service to her within the state (citation omitted), i.e., that it was or would have been a ‘practical impossibility’ for him to serve her while she was outside the state, either in England or in New Jersey (citations omitted). Plaintiff's contention that defendant lied about her address in an effort to evade service is unsubstantiated by the record.”).

CPLR 208 - Disability toll

CPLR 208 - Disability toll applies as decedent was under legal disability from day of accident until the disability was removed by his death

Kealos v. State of New York, 150 A.D.3d 1211, 55 N.Y.S.3d 411 (2d Dep’t 2017) (“Here, the claimant established that the decedent was under a legal disability from the day of the accident until the disability was removed by his death on April 13, 2011 (citations omitted). Thus, the claimant’s initial motion, served on February 19, 2013, which sought, inter alia, to file a late claim alleging medical malpractice and lack of informed consent, was timely made within 2½ years of the decedent’s death on April 13, 2011 (citations omitted). Moreover, the time to file the claimant’s renewed motion was further tolled so long as the initial motion remained pending before the Court of Claims (citations omitted). The renewed motion, which was served upon the State on November

27, 2013, was therefore timely made. Accordingly, the Court of Claims erred in denying as untimely that branch of the claimant’s renewed motion which was for leave to file a late claim alleging medical malpractice.”).

CPLR 208 - No evidence that dementia disability existed at time claim accrued

Estate of Smulewicz v. Meltzer, Lippe, Goldstein & Breitstone, LLP, 160 A.D.3d 543, 72 N.Y.S.3d 433 (1st Dep’t 2018) (“Plaintiffs' argument that the limitation period was tolled by the decedent's alleged dementia is also unavailing, as there is no evidence that the decedent suffered from such disability at the time the claim accrued (CPLR 208), or that it rendered her ‘unable to protect [her] legal rights because of an over-all inability to function in society’ (citations omitted).”).

CPLR 208 - Toll did not terminate upon the appointment of the article 81 guardian

Mederos v. New York City Health & Hosps. Corp., 154 A.D.3d 597, 61 N.Y.S.3d 905 (1st Dep’t 2017) (“Supreme Court correctly found that the CPLR 208 toll did not terminate upon the appointment of the article 81 guardian (citations omitted). The 90-day period to serve the notice of claim was not extended by the CPLR 208 toll (citations omitted). However the 90-day period was tolled in this case by the continuous treatment doctrine.”).

CPLR 208/ 217-a

CPLR 212- Ten year statute of limitations

CPLR 212 - Ten year statute of limitations and adverse possession

Slacer v. Kearney, 151 A.D.3d 1602, 57 N.Y.S.3d 255 (4th Dep’t 2017) (“It is well settled that an adverse possessor gains title to occupied real property upon the expiration of the statute of limitations for an action to recover real property pursuant to CPLR 212 (a) (citations omitted)… Here, plaintiff gained possession of the disputed land when she purchased her property in 1986 and continued to possess the disputed land for 10 years; thus, so long as the other elements of adverse possession have been met, plaintiff acquired legal title to the disputed land in 1996. Defendant contends that plaintiff was required to commence a judicial action after the requisite 10-year period passed, i.e., sooner than 2014, in order to gain title to the disputed land. We reject that contention on the ground that ‘RPAPL 501 (2), as amended, recognizes that title, not the right to commence an action to determine title, is obtained upon the expiration of the limitations period’ (citation omitted). As we explained in Franza, ‘[A]dverse possession for the requisite period of

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. time not only cuts off the true owner’s remedies but also divests [the owner] of his [or her] estate’ . . . Thus, at the expiration of the statutory period, legal title to the land is transferred from the owner to the adverse possessor . . . Title to property may be obtained by adverse possession alone, and [t]itle by adverse possession is as strong as one obtained by grant (id.). Contrary to defendant’s contention, plaintiff had no legal obligation to take any legal action to obtain title to the disputed land after 1996 inasmuch as title vested with her that year upon the expiration of the 10-year period.”).

CPLR 212(a) - 10 year statute of limitations bars claim

Weichert v. Plumadore, 152 A.D.3d 1190, 58 N.Y.S.3d 833 (4th Dep’t 2017) (“We conclude that the court properly granted the Plumadores’ cross motion for summary judgment dismissing the complaint against them on the ground that the action was barred by the statute of limitations (citations omitted). CPLR 212 (a) provides that ‘[a]n action to recover real property or its possession cannot be commenced unless the plaintiff, or his predecessor in interest, was seized or possessed of the premises within 10 years before the commencement of the action.’ ‘A person claiming title to real property, but not in possession thereof, must act, affirmatively and within the time provided by statute’ (citations omitted). Here, the Plumadores submitted evidence establishing that plaintiffs did not possess the disputed property during the 10 years immediately preceding the commencement of this action and, in opposition to the cross motion, plaintiffs failed to raise a triable issue of fact (citations omitted).”).

CPLR 212(c) - Not applicable because action was not one to “redeem” a mortgage by “making payment of the debt owed to the mortgagee”

Fabtastic Abode, LLC v. Arcella, 153 A.D.3d 668, 60 N.Y.S.3d 318 (2d Dep’t 2017) (“The Supreme Court properly determined that this action is one to quiet title and that, under CPLR 212(a), read together with RPAPL 311, the action was timely (citation omitted). Contrary to the defendant’s contention, this action is not barred by RPAPL 1501(4), since it is not one to discharge the mortgage on the ground that an action to enforce the mortgage is time-barred (citation omitted). Moreover, CPLR 212(c), which governs the timeliness of actions to redeem a mortgage, is inapplicable since the instant action is not one to “redeem” a mortgage by ‘making payment of the debt owed to the mortgagee’ (citation omitted).”).

CPLR 213 – Six-year statute of limitations

CPLR 213 - Plaintiff's challenge is to substance of the Local Law and is therefore subject to six-year statute of limitations

Matter of Weikel v. Town of W. Turin, 2018 NY Slip Op 04876 (4th Dep’t 2018) (“Contrary to plaintiff's contention and the court's determination, to the extent that plaintiff seeks a declaration that the presumptively valid Local Law is invalid (citations omitted), plaintiff's challenge is to the substance of the Local Law and is therefore subject to the six-year statute of limitations pursuant to CPLR 213 (1) (citations omitted).”).

CPLR 213 - Where mortgage holder accelerates entire debt by a demand, six-year statute of limitations begins to run on the entire debt

Wilmington Sav. Fund Socy., FSB v. Gustafson, 160 A.D.3d 1409 (4th Dep’t 2018) (“We agree with plaintiff that defendants failed to meet their initial burden of establishing that the action is time-barred. Where, as here, a mortgage is payable in installments, separate causes of action accrue for each unpaid installment, and the six-year statute of limitations begins to run on the date that each installment becomes due (citations omitted). If, however, the mortgage holder accelerates the entire debt by a demand, the six-year statute of limitations begins to run on the entire debt (citations omitted). Here, defendants' own submissions in support of the motion establish that, although another entity purported to accelerate defendants' entire debt in 2010 and 2012, that entity was not the holder or assignee of the mortgage and did not hold or own the note. Thus, the entity's purported attempts to accelerate the entire debt were a nullity, and the six-year statute of limitations did not begin to run on the entire debt (citations omitted). Although this mortgage foreclosure action therefore is not time-barred, we note that, ‘in the event that the plaintiff prevails in this action, its recovery is limited to only those unpaid installments which accrued within the six-year [and 90- day] period immediately preceding its commencement of this action’ (citations omitted).”).

CPLR 213 - Acceleration of mortgage debt

U.S. Bank N.A. v. Barnett, 151 A.D.3d 791, 56 N.Y.S.3d 255 (2d Dep’t 2017) (“Here, in support of her cross motion, the defendant submitted proof that the mortgage debt was accelerated on May 15, 2007, when the plaintiff commenced the first action to foreclose the subject mortgage. Thus, the six-year limitations period expired prior to the commencement of the instant action on July 9, 2013. Moreover, while a lender may revoke its election to accelerate the mortgage (citation omitted), the record in this case is barren of any affirmative act of revocation occurring during the six-year limitations period subsequent to the initiation of the prior action (citations omitted).”).

CPLR 213 - Action to recover debt owed and to foreclose upon a mortgage

Maidman Family Parking, LP v. Wallace Indus., Inc., 145 A.D.3d 1165, 42 N.Y.S.3d 476 (3d Dep’t 2016) (“The notes were due and payable on June 30, 2005, and it is undisputed that no payments were made. Despite the default, plaintiff did not commence this action to recover the debt owed and to foreclose upon the mortgages until July 2, 2015, well beyond the six-year limitations period (see CPLR 213)… ‘In order to meet the requirements of [General Obligations Law § 17-101], a writing must be signed, recognize an existing debt and contain nothing inconsistent with an intention on the debtor’s part to pay it’ (citations omitted). Here, Wallace signed an August 26, 2010 letter in which he acknowledged the principal amount and maturity date for each loan and, indeed, agreed to waive any statute of limitations defense available to defendants against “any claim [by plaintiff] to enforce collection of any monies due [it] arising out of the” loans. This language “clearly conveys and is consistent with an intention to pay, which is all that need be shown in order to satisfy” the statute, even if the phrasing implies that the sums owed by defendants might vary from the original principal amounts (citations omitted). A renewed

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. statute of limitations for plaintiff’s claims accordingly began to run no earlier than August 26, 2010 and, thus, the commencement of this action on July 2, 2015 was timely.”).

CPLR 213 - No evidence that contract called for continuing performance

Keles v. Hultin, 144 A.D.3d 988, 42 N.Y.S.3d 60 (2d Dep’t 2016) (“‘A breach of contract can be said to occur when the claimant’s bill is expressly rejected, or when the party seeking payment should have viewed his claim as having been constructively rejected’ (citation omitted). ‘[K]nowledge of the occurrence of the wrong on the part of the plaintiff is not necessary to start the Statute of Limitations running in [a] contract [action]’ (citations omitted). Here, the defendants established, prima facie, that the plaintiff’s remaining cause of action alleging breach of contract accrued, at the latest, in 1998, and that this cause of action, interposed in 2012 when this action was commenced, was therefore barred by the statute of limitations (citations omitted). In opposition, the plaintiff failed to raise a triable issue of fact. Contrary to the plaintiff’s contention, there is no evidence that a contract between the parties called for continuing performance over a period of time such that a new breach occurred for statute of limitations purposes each time the defendants failed to make a required payment (citation omitted). Further, the plaintiff’s alleged lack of knowledge that a breach occurred did not toll the running of the limitations period (citations omitted).”).

CPLR 213 - Breach of contract is breach of contract, not fraud!

NWM Capital, LLC v. Scharfman, 144 A.D.3d 414, 41 N.Y.S.3d 471 (1st Dep’t 2016) (“Claim is time-barred by the six-year statute of limitations applicable to breach of contract actions (citations omitted). The two-year fraud discovery rule (citations omitted), is inapplicable since the claim is one for breach of contract, not fraud (citation omitted).”).

CPLR 213 - Breach of contract claims accrue at the time of the breach, even where damages accrue at a later date

Lebedev v. Blavatnik, 144 A.D.3d 24, 38 N.Y.S.3d 159 (1st Dep’t 2016) (“The breach of contract and joint venture claims ‘accrue at the time of the breach,’ even in the event that the damages do not accrue until a later date (citation omitted). A breach of fiduciary duty claim accrues where the fiduciary openly repudiates his or her obligation — i.e., once damages are sustained (citation omitted). The statute of limitations on a breach of contract or joint venture cause of action is six years (citations omitted). The statute of limitations on a breach of fiduciary duty claim is three years where (as here) money damages are sought (citations omitted). This action was commenced within both limitations periods, because defendants ‘had a recurring obligation to pay plaintiff his . . . share of the profits generated by’ the joint venture (citations omitted). A new claim accrued when the obligation to do so was allegedly breached in 2013.”).

CPLR 213 - Breach of construction contract claim accrues upon substantial completion of work

W&W Steel, LLC v. Port Auth. of N.Y. & N.J., 142 A.D.3d 478, 37 N.Y.S.3d 80 (1st Dep’t 2016) (“In general, a construction contract is breached, and the resulting cause of action accrues, ‘upon substantial completion of the work’ (citation omitted). Although there is evidence that W & W completed some work at a later date, admissions in the complaint, and in the papers attached to the complaint, establish that the work was substantially completed in April 2011 — more than two years before the suit was filed. The agreement contains procedures for dispute resolution, but, contrary to W & W’s contention, the agreement does not set any additional conditions precedent to bringing suit that would require a finding that a different accrual date applies (citations omitted).”).

CPLR 213(2) - Claim against contractor for defective construction accrues upon completion of performance under contract

Kamath v. Building New Lifestyles, Ltd., 146 A.D.3d 765, 44 N.Y.S.3d 532 (2d Dep’t 2017) (“An action upon a contractual obligation or liability, express or implied,’ must be commenced within six years (CPLR 213[2]). ‘A claim against a contractor for damages arising from defective construction accrues, for limitations purposes, upon completion of performance under the contract’ (citation omitted). ‘This rule applies no matter how a claim is characterized in the complaint because all liability for defective construction has its genesis in the contractual relationship of the parties’ (citation omitted). Moreover, ‘construction may be complete even though incidental matters relating to the project remain open’ (citations omitted). Here, BNL established its prima facie entitlement to judgment as a matter of law dismissing the cause of action alleging breach of contract insofar as asserted against it under the statute of limitations by submitting proof demonstrating that the certificate of occupancy was issued in July 1994, that the plaintiffs moved back into the house in 1995 or 1996, and, at the time the plaintiffs moved back into the house, the only major work left to be completed from the renovation project was interior decorating (citation omitted). In opposition, the plaintiffs failed to raise a triable issue of fact.”).

CPLR 213 - Acceleration of mortgage debt

CPLR 213 - “[T]he plaintiff possessed a legal right to demand payment at the time that each loan was advanced to the defendants, and the statute of limitations began to run at each of those respective times.”

Elia v. Perla, 150 A.D.3d 962, 55 N.Y.S.3d 305 (2d Dep’t 2017) (“Here, the parties’ agreement, as alleged in the amended complaint, provided that the sums loaned to the defendants were repayable on demand. Accordingly, the plaintiff possessed a legal right to demand payment at the time that each loan was advanced to the defendants, and the statute of limitations began to run at each of those respective times (citations omitted). Contrary to the plaintiff’s contention, the three- month period for repayment following a demand did not constitute a condition that had to be fulfilled before the right to final payment arose (citations omitted). Accordingly, the Supreme Court properly granted that branch of the defendants’ motion which was pursuant to CPLR 3211(a)(5) to dismiss as time-barred so much of the first cause of action as was predicated upon loans that allegedly were made more than six years prior to the commencement of the action.”).

CPLR 213 - “The filing of the summons and complaint and notice of pendency in the 2007 action constituted a valid election to accelerate the maturity of the debt.”

Beneficial Homeowner Serv. Corp. v. Tovar, 150 A.D.3d 657, 55 N.Y.S.3d 59 (2d Dep’t 2017) (“The filing of the summons and complaint and notice of pendency in the 2007 action constituted a valid election to accelerate the maturity of the debt (citations omitted). Contrary to the plaintiff’s contention, the fact that the 2007 action was dismissed as against the defendant homeowner for failure to effectuate personal service does not invalidate the plaintiff’s election to exercise its right to accelerate the maturity of debt. ‘The fact of election should not be confused with the notice or manifestation of such election’ (citation omitted). Nothing in the parties’ agreement provides that the plaintiff’s election is not valid until the defendant homeowner receives notice thereof. Consequently, the failure to properly serve the summons and complaint upon the defendant homeowner did not as a matter of law destroy the effect of the sworn statement that the plaintiff had elected to accelerate the maturity of the debt (citations omitted).”).

CPLR 213 - No extension of statute of limitations

Gad v. Almod Diamonds Ltd., 147 A.D.3d 417, 45 N.Y.S.3d 790 (1st Dep’t 2017) (“The motion court correctly determined that plaintiff’s claims for breach of contract, unjust enrichment, constructive trust, and breach of fiduciary duty are time-barred (see CPLR 213[1], [2]; 214[4]). The letter of understanding, signed by plaintiff and his brother Albert in 1995, in which plaintiff agreed that he would not ask for shares in defendant Almod Diamonds Ltd., the family company, and that only Albert would decide if and when shares of that company were distributed, constituted a breach of the alleged earlier oral agreement entitling plaintiff to ten percent of the company. Thus, plaintiff’s claims accrued upon execution of the letter (citation omitted). Plaintiff’s subsequent demand for shares in 2013, which was refused, did not extend the statute of limitations (citation omitted). Nor was the statute of limitations extended by the alleged subsequent amendment to the oral agreement, pursuant to which plaintiff would be compensated for his share of Almod by Almod agreeing to purchase diamonds from him (citation omitted). The doctrine of

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. equitable estoppel does not apply to bar the assertion of the statute of limitations defense, since plaintiff failed to allege that specific subsequent acts by defendants kept him from timely bringing suit (citation omitted).”).

CPLR 213-Reformation based upon a purported mistake

Nationstar Mtge., LLC v. Hilpertshauser, 156 A.D.3d 1052, 66 N.Y.S.3d 687 (3d Dep’t 2017) (“‘Reformation based upon a purported mistake is governed by a six-year statute of limitations that is generally measured from the occurrence of the mistake’ (citations omitted). Contrary to plaintiff’s representation (citation omitted), ‘the same period applies to [its] cause of action seeking an equitable mortgage’ (citations omitted). The statute of limitations will not begin to run upon the mistake for those ‘in possession of real property under an instrument of title,’ but plaintiff does not allege that it has ever been in possession of the mortgaged property and does not benefit from that exception (citations omitted). The alleged mistake occurred no later than the execution of the mortgage in 2007 and, therefore, this 2015 action was appropriately dismissed against defendant as time-barred.”).

CPLR 213- Action to recover on a promissory note- where a note is payable in installments and the debt has not been accelerated, there are separate causes of action for each installment accrued, and the statute of limitations begins to run on the date each installment becomes due and is defaulted upon

Amrusi v. Nwaukoni, 155 A.D.3d 814, 65 N.Y.S.3d 62 (2d Dep’t 2017) (“Generally, a promissory note is enforceable under traditional principles of contract law (citation omitted). ‘The statute of limitations for an action to recover on a promissory note is six years’ (citations omitted). Where, as here, a note is payable in installments and the debt has not been accelerated, there are separate causes of action for each installment accrued, and the statute of limitations begins to run on the date each installment becomes due and is defaulted upon (citation omitted). . . . Applying the six- year statute of limitations to each installment which became due and was defaulted upon, the Court should have granted dismissal of only so much of the first cause of action as sought to recover unpaid installments accruing under the note more than six years prior to March 3, 2016, as time- barred (citation omitted). Thus, the first cause of action was timely to the extent that it sought to recover unpaid installments accruing under the note on or after March 3, 2010.”).

CPLR 213-To determine the statute of limitations applicable to a particular declaratory judgment action, the court must examine the substance of that action to identify the relationship out of which the claim arises and the relief sought

Wells Fargo Bank, N.A. v. Burke, 155 A.D.3d 668, 64 N.Y.S.3d 228 (2d Dep’t 2017) (“Here, the defendants established, prima facie, that the causes of action seeking declarations that the plaintiff had a mortgage on the property under the doctrines of equitable mortgage and equitable subrogation were barred by the six-year statute of limitations. ‘In order to determine the Statute of Limitations applicable to a particular declaratory judgment action, the court must examine the substance of that action to identify the relationship out of which the claim arises and the relief sought’ (citations omitted). ‘If the court determines that the underlying dispute can be or could

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. have been resolved through a form of action or proceeding for which a specific limitation period is statutorily provided, that limitation period governs the declaratory judgment action’ (citation omitted). A cause of action seeking to establish a lien pursuant to the doctrine of equitable mortgage or the doctrine of equitable subrogation is governed by a six-year statute of limitations (citations omitted). Those causes of action accrued no later than June 16, 1997, when the mortgage and note were made (citation omitted) and, therefore, those causes of action, commenced in 2014, are untimely. In opposition to the defendants’ motion, the plaintiff failed to demonstrate the existence of an issue of fact as to whether the relevant statutes of limitation were tolled or were otherwise inapplicable (citation omitted). Accordingly, those branches of the defendants’ motion which were pursuant to CPLR 3211(a)(5) to dismiss the causes of action seeking declarations that the plaintiff had a mortgage on the property under the doctrines of equitable mortgage and equitable subrogation should have been granted.”).

CPLR 213- Action to enforce distributive award in a matrimonial action subject to the six- year statute of limitations set forth versus motion to enforce the terms of the separation agreement pursuant to Domestic Relations Law § 244, not subject to six year statute of limitations

Holsberger v. Holsberger, 154 A.D.3d 1208, 63 N.Y.S.3d 559 (3d Dep’t 2017) (“Next, we reject the husband’s argument that the enforcement of the separation agreement is barred by the statute of limitations. In general, a statute of limitations defense applies to actions and special proceedings (citation omitted). The husband correctly argues that an action to enforce a distributive award in a matrimonial action is subject to the six-year statute of limitations set forth in CPLR 213 (1) and (2) (citation omitted). Here, however, the wife’s motion to enforce the terms of the separation agreement pursuant to Domestic Relations Law § 244 is not an action and thus not subject to the statute of limitations set forth in CPLR 213 (2) (citations omitted).”).

CPLR 213(1) - Statute of limitations for breach of fiduciary duty claim depends on substantive remedy sought

Matter of Twin Bay Vil., Inc. v. Kasian, 153 A.D.3d 998, 60 N.Y.S.3d 560 (3d Dep’t 2017) (“Next, we are unpersuaded by respondents’ contention that this proceeding is time-barred. It is well settled that ‘New York law does not provide a single statute of limitations for breach of fiduciary duty claims [and] the choice of the applicable limitations period depends on the substantive remedy that the [petitioner] seeks’ (citations omitted). Here, the gravamen of the petition is that respondents, as the majority shareholders, breached their fiduciary duties owed to petitioners, as the minority shareholders. Although the petition alleges fraudulent acts in the form of looting, the allegation of fraud is not essential to the breach of fiduciary duty claim. In light of this, and the fact that the remedy of a judicial dissolution is equitable in nature, we find that ‘the six-year limitations period of CPLR 213 (1) applies’ (citations omitted), and it does not commence ‘until there has been an open repudiation by the fiduciary or the relationship has otherwise been clearly terminated’ (citations omitted). In our view, respondents’ attempt in 2009 to force petitioners to sell their shares is the earliest point at which respondents can be said to have openly repudiated the fiduciary relationship. Given that this proceeding was commenced within six years of the 2009 force-out attempt, we agree with Supreme Court that this proceeding is not time-barred.”).

CPLR 213(2) - Transaction predominantly for services, not for goods subject to UCC 2-725

Fallati v. Concord Pools, Ltd., 151 A.D.3d 1446, 54 N.Y.S.3d 345 (3d Dep’t 2017) (“Contrary to plaintiff’s assertion, ‘the transaction in this case is predominantly one for services,’ i.e., the construction of a swimming pool, and any ‘sale of goods is merely incidental to the services provided’ by defendant (citation omitted). Thus, plaintiff’s claim is not encompassed by the four- year statute of limitations set forth in UCC 2-725 but, rather, is governed by the six-year statute of limitations set forth in CPLR 213 (2) (citations omitted). As plaintiff’s claim accrued upon the completion of the swimming pool in 2002 and this action was not commenced until 2015, plaintiff’s breach of contract claim is time-barred.”).

CPLR 213(2) - Transactions predominantly for services

Hagman v. Swenson, 149 A.D.3d 1, 47 N.Y.S.3d 324 (1st Dep’t 2017) (Contract for interior design services. “Mixed transaction contracts, involving both goods and services, require a determination as to whether the transaction is predominantly one for goods or one for services, for statute of limitations purposes. In this case, the issue is raised in the context of a contract that provides for interior design services, including the procurement of furniture and other items required for achieving the desired design. Interestingly, notwithstanding that interior design services are apparently in much demand in New York, to our knowledge, there are no published opinions on this issue in this state. The action arises from an unpaid bill mostly for furniture and other items. The primary question on appeal is whether plaintiff’s breach of contract claim is governed by the four-year statute of limitations set forth in UCC 2-725 for breach of a sale-of-goods contract or the six-year statute of limitations in CPLR 213 for breach of a services contract. We find that the transaction in this case is predominantly one for services (citation omitted), and the sale of goods is merely incidental to the services provided. Accordingly, plaintiff’s breach of contract claim is timely.”).

CPLR 213(4) – Action to foreclose mortgage

Kashipour v. Wilmington Sav. Fund Socy., FSB, 144 A.D.3d 985, 41 N.Y.S.3d 738 (2d Dep’t 2016) (“As relevant here, RPAPL 1501(4) authorizes a person having an estate or interest in real property subject to a mortgage to maintain an action against another to secure the cancellation and discharge of record of such encumbrance where the period allowed by the applicable statute of limitations for the commencement of an action to foreclose the mortgage has expired, provided, however, that the mortgagee or its successor is not in possession of the affected real property at the time of the commencement of the action (see RPAPL 1501[4]). An action to foreclose a mortgage is subject to a six-year statute of limitations (see CPLR 213[4]). ‘The law is well settled that, even if a mortgage is payable in installments, once a mortgage debt is accelerated, the entire amount is due and the Statute of Limitations begins to run on the entire debt’ (citations omitted). Here, the plaintiffs submitted proof that the mortgage debt was accelerated on August 20, 2009, and thus the six-year statute of limitations for an action to foreclose the mortgage had expired by the time the instant action was commenced on September 3, 2015.”).

CPLR 213(8) - Governs fraud claims – Executive Law § 63(12)

People v. Credit Suisse Sec. (USA) LLC, 145 A.D.3d 533, 47 N.Y.S.3d 236 (1st Dep’t 2016) (“As this Court previously held in State of New York v. Bronxville Glen I Assoc. (181 AD2d 516, 516 [1st Dept 1992]), the statute of limitations for an action brought by the Attorney General under the Martin Act alleging investor fraud ‘is six years pursuant to CPLR 213(8), and not three years pursuant to CPLR 214’ (citations omitted). More recently in Matter of People v Trump Entrepreneur Initiative LLC (137 AD3d 409 [1st Dept 2016]), lv granted 2016 NY Slip Op 73667[U] [May 17, 2016] (Trump) we analyzed the issue of the statute of limitations for claims brought under Executive Law § 63(12). In conducting this analysis, we first noted that the language of § 63(12) parallels the language of the Martin Act (citation omitted). Additionally, we noted, section 63(12) ‘did not make’ unlawful the alleged fraudulent practices, but only provided standing in the Attorney-General to seek redress and additional remedies for recognized wrongs which pre- existed the statute []’ (citation omitted). We further found that ‘section 63(12) does not encompass a significantly wider range of fraudulent activities than were legally cognizable before the section’s enactment’ (citation omitted). Thus, we concluded, the Attorney General’s ‘fraud claim under [Executive Law] § 63(12) . . . is subject to the residual six-year statute of limitations in CPLR 213(1)’ because the section ‘does not create any liability nonexistent at common law, at least under the court’s equitable powers’ (citation omitted). We adhere to that determination here. The conduct targeted under § 63(12) parallels the conduct covered under the Martin Act’s definition of fraud in that both the Martin Act and § 63(12) target wrongs that existed before the statutes’ enactment, as opposed to targeting wrongs that were not legally cognizable before enactment. Accordingly, § 63(12) is not subject to the three-year statute of limitations under CPLR 214 (citation omitted). The dissent maintains that the complaint is based on statutory violations encompassing a larger range of claims than were legally cognizable before § 63(12)’s enactment. But, as noted above, and as we noted in Trump, the conduct at issue in this action was, in fact, always subject to granting of relief under the courts’ equitable powers (citation omitted). Further, CPLR 213(1), rather than CPLR 214(2), is applicable to an Executive Law § 63(12) claim based on a scheme to obtain ownership of distressed properties by means of fraudulent misrepresentations (citation omitted).”).

CPLR 213(8) - Duty to inquire that fraud has been committed

MBI Intl. Holdings Inc. v Barclays Bank PLC, 151 A.D.3d 108, 57 N.Y.S.3d 119 (1st Dep’t 2017) (“This appeal arises out of an alleged scheme to defraud a Saudi Arabian residential real estate developer out of hundreds of millions of dollars owed to it by the Saudi government. Its resolution requires us to construe New York’s date of discovery rule for purposes of ascertaining when the statute of limitations was triggered with respect to plaintiffs’ fraud-based claims. Ultimately, the result we reach today embraces the well-settled rule established in New York long ago - ‘[W]here the circumstances are such as to suggest to a person of ordinary intelligence the probability that he [or she] has been defrauded, a duty of inquiry arises, and if he [or she] . . . shuts his [or her] eyes to the facts which call for investigation, knowledge of the fraud will be imputed to him [or her]’ (citation omitted). Thus, we affirm the motion court’s holding to the extent it dismissed plaintiffs’ action as time-barred….[W]e find that it conclusively appears in this case that the plaintiffs had undisputed knowledge of facts by at least 2008 from which fraud could reasonably be inferred

(citations omitted). Because the statute was triggered by at least 2008, and plaintiffs failed to pursue any investigation until 2013, five years later, plaintiffs are barred from asserting a claim for fraud.”).

CPLR 213(8) - Reasonable diligence to discover fraud

Norddeutsche Landesbank Girozentrale v. Tilton, 149 A.D.3d 152, 48 N.Y.S.3d 98 (1st Dep’t 2017) (“‘The inquiry as to whether a plaintiff could, with reasonable diligence, have discovered the fraud turns on whether the plaintiff was possessed of knowledge of facts from which [the fraud] could be reasonably inferred. Generally, knowledge of the fraudulent act is required and mere suspicion will not constitute a sufficient substitute. Where it does not conclusively appear that a plaintiff had knowledge of facts from which the fraud could reasonably be inferred, a complaint should not be dismissed on motion and the question should be left to the trier of the facts’ (citation omitted). At the same time, ‘[i]t is well settled that if a party omits an inquiry when it would have developed the truth, and shuts his eyes to the facts which call for investigation, knowledge of the fraud will be imputed to him’ (citation omitted). Loss alone, however, cannot give rise to such a duty to inquire (citation omitted). Defendants maintain that plaintiffs should have inferred the existence of the fraudulent scheme they allege as early as 2009, based on the various documents and events they present in support of their motion. Plaintiffs counter that the ‘clues’ defendants contend they should have picked up were insufficient for them to establish the crux of their complaint, which is that the Funds were not CDOs, but rather a method by which defendants could use borrowed money to enrich themselves by plundering the Portfolio Companies. Giving to plaintiffs, as we must, the most favorable interpretation of defendants’ evidence, we find that plaintiffs had insufficient facts before the SEC proceeding to plead their causes of action.”).

CPLR 213 - Fraud-issue of when a plaintiff, acting with reasonable diligence, could have discovered an alleged fraud involves a mixed question of law and fact

Berman v. Holland & Knight, LLP, 156 A.D.3d 429, 66 N.Y.S.3d 458 (1st Dep’t 2017) (“The two- year discovery provision does apply to actual fraud (first cause of action). ‘[T]he issue of when a plaintiff, acting with reasonable diligence, could have discovered an alleged fraud . . . involves a mixed question of law and fact, and, where it does not conclusively appear that a plaintiff had knowledge of facts from which the alleged fraud might be reasonably inferred, the cause of action should not be disposed of summarily on statute of limitations grounds. Instead, the question is one for the trier-of-fact’ (citation omitted). One cannot say, as a matter of law, that the Internal Revenue Service’s July 2007 deficiency notice, which mentioned only nonparty Derivium, placed plaintiffs on inquiry notice of defendant’s alleged fraud (citation omitted). Plaintiffs plausibly allege that, until defendant produced its file on January 8, 2015 in response to a motion to compel in Tax Court, they had no inkling of its purported fraud (citation omitted). Unlike the subprime crisis in Aozora Bank, Ltd. v Deutsche Bank Sec. Inc. (citation omitted) (cited by defendant), Derivium’s fraud was not common knowledge.”).

CPLR 213- Fraud claims barred-plaintiffs failed to establish that the fraud could not have been discovered earlier

Moses v. Dunlop, 155 A.D.3d 466, 64 N.Y.S.3d 214 (1st Dep’t 2017) (“The fraud claims, to the extent they arise from conduct that occurred in 2006, are time-barred (citation omitted). Plaintiffs failed to establish that the fraud could not have been discovered earlier (citation omitted). At the very latest, they were on inquiry notice by January 2007, when Dunlop presented Moses and Kaufman with the settlement and release agreement — more than two years before the commencement of this action (citations omitted). Unlike the situation in CSAM Capital, plaintiffs allowed years to go by without confronting Dunlop or Bravo about any concerns they may have had in the face of Dunlop’s highly publicized continued involvement in the Series, his participation in and receipt of credits for spin-offs in other locations.”).

CPLR 213(8) - Plaintiff established that he could not, with reasonable diligence, have discovered the fraud until 2013, when he learned for the first time that he was the beneficiary of a structured settlement from which he was entitled to receive millions of dollars in monthly and periodic lump-sum payments

Monteleone v. Monteleone, 2018 NY Slip Op 04317 (2d Dep’t 2018) (“Contrary to the defendant's contentions, since the cause of action for conversion is based upon fraud, it is governed by the statute of limitations period for fraud set forth in CPLR 213(8) (citations omitted). The limitations period for fraud under CPLR 213(8) also applies to the breach of fiduciary duty causes of action inasmuch as the allegations of fraud are essential to those claims (citations omitted). . . . Here, the plaintiff established that he could not, with reasonable diligence, have discovered the fraud until 2013, when he learned for the first time that he was the beneficiary of a structured settlement from which he was entitled to receive millions of dollars in monthly and periodic lump-sum payments. The plaintiff initiated this action within a few months of learning this information and confronting the defendant, who refused to share details about the structured settlement with him because she was purportedly bound by a confidentiality agreement not to do so. Contrary to the defendant's contention, she did not raise a triable issue of fact as to whether the plaintiff could have, with reasonable diligence, discovered the alleged misconduct earlier. Accordingly, we agree with the Supreme Court's determinations that the conversion and breach of fiduciary duty causes of action are not time-barred, and to grant the plaintiff's motion for summary judgment on the issue of liability.”).

CPLR 213(8) - Cause of action for aiding and abetting a breach of fiduciary duty – alleging fraud essential to claim

New York State Workers’ Compensation Bd. v. Fuller & LaFiura, CPAs, P.C., 146 A.D.3d 1110, 46 N.Y.S.3d 266 (3d Dep’t 2017) (“Next, Fuller contends that Supreme Court erred in failing to order the dismissal of the portions of the causes of action for aiding and abetting a breach of fiduciary duty (fourteenth cause of action), aiding and abetting fraud (twenty-third cause of action) and professional negligence (thirty-second cause of action) that Supreme Court determined were governed by the three-year statute of limitations period set forth in CPLR 214 (6). Starting first with the causes of action for aiding and abetting a breach of fiduciary duty and aiding and abetting

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. fraud, plaintiff contends that Supreme Court, in the first instance, erred in applying a three-year statute of limitations to those claims. We agree. The cause of action for aiding and abetting a breach of fiduciary duty is premised upon allegations that Fuller, among other things, intentionally misrepresented the trust’s true financial condition with the knowledge that this would aid and abet the breach of fiduciary duties by the trustees, Cody and CSI. Inasmuch as ‘the allegations of fraud perpetrated by [Fuller] are essential to this claim, a six-year statute of limitations pursuant to CPLR 213 (8) is applicable’ (citations omitted). Similarly, our review of the aiding and abetting fraud claim confirms that the underlying facts are also based in fraud, and, thus, the six-year statute of limitations also applies to this claim (citations omitted). Accordingly, these causes of action are timely insofar as they allege conduct occurring after May 31, 2007.”).

CPLR 213-a - Residential rent overcharge

CPLR 213-a - Court properly looked back beyond the four-year limitations period for plaintiffs' rent-overcharge claim to establish the proper base rent, as there was sufficient indicia of fraud

Butterworth v. 281 St. Nicholas Partners, LLC, 160 A.D.3d 434, 74 N.Y.S.3d 528 (1st Dep’t 2018) (“The court properly looked back beyond the four-year limitations period for plaintiffs' rent- overcharge claim (citation omitted) to establish the proper base rent, in that sufficient indicia of fraud existed (citation omitted). While neither an increase in rent, standing alone, nor plaintiffs' skepticism about apartment improvements suffice to establish indicia of fraud (citations omitted), here at the same time that the predecessor landlord increased the rent from $949.34 to $1,600 in plaintiffs' initial lease, it also ceased filing annual registration statements for 2007 through 2012. Moreover, plaintiffs' initial lease contained a ‘Deregulation Rider for First Unregulated Rent,’ which left blank spaces which would have indicated either that the last legal regulated rent or the new legal rent exceeded the $2,000 threshold for deregulation, and may well be viewed as an attempt to obfuscate the regulatory status of the apartment, despite that the rent had not reached the $2,000 threshold. Nevertheless, while the court properly determined that the last legal rent was $949.34, and that the complaint should not be dismissed based on this four-year limitation period, this look back based on such indicia of fraud did not warrant assessing overcharge damages for the entire period. Rather, ‘section 213-a merely limits tenants' recovery to those overcharges occurring during the four-year period immediately preceding [plaintiffs'] rent challenge’ (citations omitted). Furthermore, the discrepancies in plaintiffs' initial lease, and the lack of any annual registration statements after the increase, coupled with the fact that the $1,600 did not reach the threshold for deregulation, demonstrate that defendant landlord failed to show by a preponderance of evidence that it did not act willfully (citations omitted). However, ‘[n]o penalty of three times the overcharge may be based upon an overcharge having occurred more than two years before the complaint is filed’ (citation omitted).”).

CPLR 213-a - Action for residential rent overcharge – 4 years

Roberts v. Tishman Speyer Properties LP, 13 N.Y.3d 270, 890 N.Y.S.2d 388, 918 N.E.2d 900 (2009) (Court of Appeals held landlords were not entitled to use luxury deregulation provisions of Rent Stabilization Law while receiving J-51 tax program benefits for building rehabilitation and

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. capital improvement projects. The Court left other issues, “including retroactivity, class certification, the statute of limitations, and other defenses that may be applicable to particular tenants,” for determination by the lower court.).

CPLR 213-b - Action by victim of criminal offense

CPLR 213-b - “Crime” does not include violation

Elliott v. Grant, 150 A.D.3d 1080, 52 N.Y.S.3d 645 (2d Dep’t 2017) (“In support of her cross motion to dismiss the complaint as time-barred, and in opposition to the plaintiff’s motion, in effect, to strike the affirmative defense of the statute of limitations, the defendant established that she was convicted of the violations of harassment and disorderly conduct in connection with the incidents at issue. Pursuant to Penal Law § 10.00(6), ‘Crime’ means a misdemeanor or a felony’ (citation omitted). Where the defendant was not convicted of any crime in connection with the subject of the action, ‘CPLR 213-b, by its plain terms, does not apply’ (citation omitted). Here, since the defendant was convicted of violations, which are not crimes, the Supreme Court properly declined to apply the seven-year statute of limitations as provided in CPLR 213-b and granted the defendant’s cross motion pursuant to CPLR 3211(a)(5) to dismiss the complaint as time-barred.”).

CPLR 214 - Three year statute of limitations

CPLR 214 - Claims under New York State and City Human Rights Law barred

Chung v. Mary Manning Walsh Nursing Home Co., Inc., 147 A.D.3d 452, 46 N.Y.S.3d 587 (1st Dep’t 2017) (“In September 2013, defendants, plaintiff, and plaintiff’s union entered into a ‘Settlement Agreement’ resolving a grievance proceeding brought by the union regarding her separation from employment in January 2012. Among other provisions, in the Settlement Agreement, the parties agreed that plaintiff would be deemed to have resigned on January 8, 2012. Since plaintiff makes no claim that the Settlement Agreement is invalid (citations omitted), it thus fixes the date of her separation from employment at January 8, 2012 (citations omitted). Defendants’ assertion of the Settlement Agreement’s terms via motion in response to the complaint renders this a ‘proceeding to enforce [its] terms’ as stipulated therein (citations omitted). Since plaintiff filed the complaint in this action on January 17, 2015, more than three years after the stipulated date of her resignation, her claims under the New York State and City Human Rights Laws are time-barred under the applicable three-year limitations periods (citations omitted).”).

CPLR 214(2) - Does not automatically apply to all causes of action in which a statutory remedy is sought, but only where liability “would not exist but for a statute”‘

New York State Workers’ Compensation Bd. v. Any-time Home Care Inc., 156 A.D.3d 1043, 66 N.Y.S.3d 690 (3d Dep’t 2017) (“As the provisions in the trust agreements pertaining to joint and several liability are mandated by the Workers’ Compensation Law, the SL defendants contend that the cause of action is statutory rather than contractual. However, ‘CPLR 214 (2) does not

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. automatically apply to all causes of action in which a statutory remedy is sought, but only where liability “would not exist but for a statute”‘ (citations omitted). ‘[C]laims which, although provided for in a statute, merely codify or implement an existing common-law liability’ are not governed by CPLR 214 (2), but by the limitations period that applies to the underlying common-law cause of action (citations omitted). Here, Workers’ Compensation Law § 50 (3-a) (3) did not create a new liability, but merely implemented the existing common-law concept of joint and several liability by requiring group self-insured trusts to include it in their contractual relationships with members. Members of the trust incurred joint and several liability for the trust’s cumulative deficit by entering into agreements that imposed that liability. If they had not done so, the statute would have imposed no liability upon them. The statutory requirement to include joint and several liability provisions in the agreements ‘does not alter the fact that the dispute is fundamentally contractual in nature and not a creature of statute’ (citations omitted). Thus, Supreme Court correctly determined that the action is timely. The parties’ remaining arguments related to this issue are rendered academic by this determination.”).

CPLR 214 - Action barred by three-year statute of limitations for recovery of a chattel

Loscalzo v. 507-509 President St. Tenants Assn. Hous. Dev. Fund Corp., 153 A.D.3d 614, 57 N.Y.S.3d 427 (2d Dep’t 2017) (“The defendants established that the action was barred by the three- year statute of limitations for recovery of a chattel (citation omitted). ‘In order to determine the Statute of Limitations applicable to a particular declaratory judgment action, the court must examine the substance of that action to identify the relationship out of which the claim arises and the relief sought’ (citations omitted). ‘If the court determines that the underlying dispute can be or could have been resolved through a form of action or proceeding for which a specific limitation period is statutorily provided, that limitation period governs the declaratory judgment action’ (citations omitted). Here, the plaintiff seeks to recover a stock certificate representing shares in a cooperative apartment corporation. An action to recover a stock certificate is governed by the three-year statute of limitations for recovery of a chattel (citations omitted). ‘Shares of stock issued in connection with cooperative apartments are personal property, not real property’ (citations omitted).”).]

CPLR 214 / 214-a - Is it malpractice or ordinary negligence? The critical factor is the nature of the duty owed to the plaintiff that the defendant is alleged to have breached

Bell v. WSNCHS N., Inc., 153 A.D.3d 498, 59 N.Y.S.3d 475 (2d Dep’t 2017) (“The sole issue to be determined on this appeal is whether the 2½-year statute of limitations applicable to an action sounding in medical malpractice (citation omitted) or the three-year statute of limitations for an ordinary negligence action (citation omitted) is applicable. The critical factor is the nature of the duty owed to the plaintiff that the defendant is alleged to have breached. A hospital or medical facility has a general duty to exercise reasonable care and diligence in safeguarding a patient, based in part on the capacity of the patient to provide for his or her own safety (citations omitted). ‘The distinction between ordinary negligence and malpractice turns on whether the acts or omissions complained of involve a matter of medical science or art requiring special skills not ordinarily possessed by lay persons or whether the conduct complained of can instead be assessed on the basis of the common everyday experience of the trier of the facts’ (citations omitted). Generally,

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. a claim will be deemed to sound in medical malpractice ‘when the challenged conduct constitutes medical treatment or bears a substantial relationship to the rendition of medical treatment by a licensed physician’ (citations omitted). Thus, when the complaint challenges a medical facility’s performance of functions that are ‘an integral part of the process of rendering medical treatment’ and diagnosis to a patient, such as taking a medical history and determining the need for restraints, the action sounds in medical malpractice (citations omitted). Here, in support of their motion for summary judgment dismissing the complaint as time-barred, the defendants established, prima facie, that this action, commenced on April 12, 2012, was barred by the 2½-year statute of limitations applicable to medical malpractice actions. The defendants’ evidence showed that on April 12, 2009, the plaintiff’s decedent, Ruby Bell (hereinafter the decedent), was admitted to New Island Hospital with a history of dementia, and placed on ‘Fall Prevention Protocol.’ After the decedent was found standing at her bedside trying to remove her foley catheter, a physician ordered that she be restrained with a vest and wrist restraints. On the morning of April 18, 2009, the decedent was discovered sitting on the floor next to her bed. The bed’s side rails were up and the decedent was not aware of how she came to be on the floor. She had apparently fallen while trying to climb out of her bed. Thereafter, the decedent was diagnosed with a distal radius fracture of the right forearm. The plaintiff alleged that this incident arose out of the failure of the defendants’ staff to follow the physician’s order to restrain her (citations omitted). In opposition to the defendants’ prima facie showing of entitlement to judgment as a matter of law, the plaintiff failed to raise a triable issue of fact. Contrary to the plaintiff’s contentions, the allegations at issue essentially challenged the defendants’ assessment of the decedent’s supervisory and treatment needs (citation omitted). Thus, the conduct at issue derived from the duty owed to the decedent as a result of the physician-patient relationship and was substantially related to her medical treatment (citations omitted).”).

Moore v. St. James Health Care Ctr., LLC, 141 A.D.3d 701, 35 N.Y.S.3d 464 (2d Dep’t 2016) (“For two weeks in June 2003, the plaintiff’s decedent, an 83-year-old man who suffered from various ailments, was a resident of the defendant, St. James Health Care Center, LLC, a residential health care facility. Alleging that the decedent sustained certain injuries while in the defendant’s care, the plaintiff commenced this action setting forth causes of action to recover damages for medical malpractice, negligence, gross negligence, and deprivation of rights pursuant to Public Health Law § 2801-d. In an order dated July 7, 2007, the Supreme Court, inter alia, directed the dismissal of the medical malpractice cause of action as time-barred. In the order appealed from, the Supreme Court granted those branches of the defendant’s motion which were for summary judgment dismissing the causes of action alleging negligence, gross negligence, and deprivation of rights pursuant to Public Health Law § 2801-d. In a judgment entered June 17, 2014, the complaint was dismissed. The plaintiff appeals. The critical question in determining whether an action sounds in medical malpractice or simple negligence is the nature of the duty to the plaintiff which the defendant is alleged to have breached” (citation omitted). “When the duty arises from the physician-patient relationship or is substantially related to medical treatment, the breach gives rise to an action sounding in medical malpractice, not simple negligence” (id.). Here, the Supreme Court properly determined that the cause of action to recover damages for negligence, to the extent not premised upon the defendant’s alleged failure to protect the decedent from falling (which claim the court found to be without merit), actually sounded in medical malpractice, and was therefore

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. time-barred by the 2½-year statute of limitations governing medical malpractice causes of action (citations omitted).”).

CPLR 214(2) - Does not apply because Insurance Law 3105 does not create a cause of action

CIFG Assur. N. Am., Inc. v. J.P. Morgan Sec. LLC, 146 A.D.3d 60, 44 N.Y.S.3d 2 (1st Dep’t 2016) (Court applies six year statute of limitations. “There is no merit to defendant’s argument that CIFG’s Insurance Law § 3105 claim is time-barred under CPLR 214(2), which imposes a three- year statute of limitations for ‘action[s] to recover upon a liability . . . created or imposed by statute.’ CPLR 214(2) applies ‘only where liability would not exist but for a statute,’ and ‘does not apply to liabilities existing at common law which have been recognized or implemented by statute’ (citation omitted). Insurance Law § 3105 does not, by its terms, create a cause of action, but merely codifies common law principles (citation omitted). Thus, CPLR 214(2) does not bar the misrepresentation claim.”).

CPLR 214(2)

David L. Ferstendig, Majority of Court of Appeals Applies Three-Year Statute of Limitations to No-Fault Claims Against a Self-Insurer, 691 N.Y.S.L.D. 1-2 (2018).

Majority of Court of Appeals Applies Three-Year Statute of Limitations to No-Fault Claims Against a Self-Insurer

Dissent Advocates Six-Year Limitation Period, Seeing No Reason to Distinguish Between No- Fault Claims Versus a Self-Insurer, as Opposed to an Insurer

Three of the four Appellate Division departments have applied a six-year statute of limitations to no-fault claims asserted by an insured against an insurer under an insurance policy. That issue, however, was not before the Court of Appeals in Contact Chiropractic, P.C. v. New York City Tr. Auth., 2018 N.Y. Slip Op. 03093 (May 1, 2018). The question here was which period should be applied to no-fault claims brought against a self-insurer: a three-year or a six-year statute of limitations. On that issue, the Court of Appeals split.

In Contact Chiropractic, a passenger in a bus owned by the defendant, the New York Transit Authority (NYCT), was injured in a motor vehicle accident. NYCT did not have nofault insurance coverage; it was self-insured. After the plaintiff provided health services to the injured passenger arising out of her injuries in the accident, the passenger assigned her right to the plaintiff to recover first-party benefits from NYCT. Plaintiff brought this action, seeking reimbursement for outstanding invoices.

The defendant moved to dismiss, arguing, among other things, that the action was untimely under CPLR 214(2), which applies a three-year statute of limitations to actions to recover upon a liability created or imposed by statute. Defendant argued that CPLR 213(2), which provides for a six-year statute of limitations in actions based on a contractual obligation or liability, did not apply because it was selfinsured and did not have an insurance policy. Defendant relied on First Department

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. authority providing that a self-insurer’s "obligation to provide no-fault benefits arises out of the no-fault statute," and that the three-year statute of limitations applies to actions arising out of the payment of such benefits. The plaintiff countered that a six-year limitation period applied, relying on Second Department authority holding that uninsured motorist benefits claims against a self- insured vehicle owner are contractual in nature, even though they are statutorily mandated.

The Civil Court denied the motion, applying the six-year statute of limitations. The Appellate Term and Appellate Division affirmed. A majority of the Court of Appeals reversed. While acknowledging the Appellate Division’s application of a six-year limitation period to no-fault claims against insurers, it noted that the law was unsettled with respect to claims against a self- insurer. In concluding that the three-year limitation period under CPLR 214(2) applied, the Court emphasized that the no-fault law is a creature of statute, unknown at common law, and the no-fault benefits here were not provided by contract with a private insurer, but by a self-insurer meeting its statutory obligations. The majority assured that "our holding here does not reduce the no-fault liability or obligations of self-insurers, or curtail the substantive no-fault rights of injured parties or their assignees as against such self-insurers." Id. at ∗2.

The dissent was troubled by establishing two sets of limitation periods, one for actions against insurers (six years) and one for actions against self-insurers (three years). It maintained that the no-fault law did not distinguish between insurers or self-insurers and imposed equal liability for the payment of no-fault benefits on both; the accrual date for both types of claims is the same (when payments become overdue); the no-fault law provides no limitation period; there is no dispute in the courts below that a six-year limitation period applies to a no-fault action against an insurer; and the absence of a contract does not necessarily mean that actions against self-insurers are statutory in nature, particularly here where a self-insurer’s obligation to provide no-fault benefits is not fundamentally different from that of an insurer.

The dissent argued that public policy considerations and "fundamental fairness" militated against having a different statute of limitation period for actions against a self-insurer and that settled precedent confirmed no meaningful difference between insurers and self-insurers.

The dissent concluded that providing self-insurers with a shorter statute of limitations leads to "arbitrary and inequitable" results:

Consider the scenario of a private automobile, insured through a policy of insurance, colliding with a public bus, insured through a certificate of self- insurance. The driver of the car and a passenger on the bus suffer relatively minor injuries requiring medical treatment. They both seek payment for first-party medical benefits from those obligated to pay. Under the majority’s holding, the injured driver will have six years to file suit based on the failure to pay first-party benefits, but the injured passenger will have only three years. By the mere fortuity that a public bus company is "self-insured," the injured passenger is put at significant disadvantage. From an injured claimant’s perspective, however, the right to recover benefits from a self-insurer is no different than the equivalent right under a contract of insurance issued to a private automobile owner. The rule now

put forward by the majority raises the troubling appearance that an equally- deserving claimant could be barred from recovering benefits merely because the offending party effectively "bought" self-insured status (citations omitted).

Id. at ∗3.

CPLR 214(3) - Statute of limitations in declaratory judgment action determined by examining substance of action; here three year statute of limitations for recovery of chattel applied

CPLR 214(4) - Governs a de facto taking claim

Matter of South Richmond Bluebelt, Phase 3. 594 Assoc., Inc. (City of New York), 141 A.D.3d 672, 35 N.Y.S.3d 628 (2d Dep’t 2016) (“A de facto taking claim is governed by the three-year statute of limitations applicable to claims to recover damages for injury to property set forth in CPLR 214(4) (citations omitted). Such a claim accrues at the time of the taking or, at the latest, when the taking becomes apparent, regardless of the time of discovery (citations omitted). Here, the record established that the headwall and overflow outlet were readily visible when the alleged taking occurred in September 2005. Accordingly, the Supreme Court properly determined that the claimant’s time to bring any claim for damages for the alleged de facto taking expired in September 2008, and so properly granted the City’s motion to strike the claimant’s appraisal report and preclude it from offering any testimony concerning the report’s contents on that ground. Contrary to the claimant’s contention, the continuous wrong doctrine is not applicable to its de facto taking claim (citations omitted).”).

CPLR 214(6) - Cause of action against an architect for professional malpractice accrues “upon the actual completion of the work to be performed and the consequent termination of the professional relationship”

Willis Ave Dev., LLC v. Block 3400 Constr. Corp., 142 A.D.3d 993, 37 N.Y.S.3d 160 (2d Dep’t 2016) (“A cause of action to recover damages against an architect for professional malpractice is

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. governed by a three-year statute of limitations (citations omitted). Such a cause of action accrues ‘upon the actual completion of the work to be performed and the consequent termination of the professional relationship’ (citations omitted). However, ‘[t]he completion of an architect’s obligations must be viewed in light of the particular circumstances of the case’ (citation omitted). Here, Stanley and Lauria established, prima facie, that the professional malpractice causes of action asserted against them accrued more than three years prior to commencement of the action (citations omitted). Specifically, the causes of action against them accrued, at the latest, on February 4, 2004, when the site plan was approved by the DOB (citations omitted). Thus, Stanley and Lauria established their prima facie entitlement to judgment as a matter of law dismissing the professional malpractice causes of action asserted against them on the ground that those causes of action were time-barred. In opposition, the plaintiff failed to raise a triable issue of fact.”).

Wallace v. BSD-M Realty, LLC, 142 A.D.3d 701, 36 N.Y.S.3d 884 (2d Dep’t 2016) (“Here, BSD- M failed to demonstrate its prima facie entitlement to judgment as a matter of law on its counterclaim seeking to equitably estop the plaintiff from asserting title to the property. Although BSD-M made a prima facie showing that the plaintiff knew of the allegedly forged deed transferring title from her to Edward Wallace, unjustifiably delayed almost two years in commencing this action from the time she was advised to do so by the Kings County District Attorney’s Office, and intended her delay to be acted upon, and that BSD-M lacked knowledge of the allegedly forged deed and prejudicially changed its position (citations omitted), BSD-M failed to establish, prima facie, that its reliance upon the plaintiff’s conduct was justified (citations omitted). BSD-M submitted evidence that it had no knowledge of the allegedly defective chain of title and would not have purchased the property or expended almost $400,000 on renovations if it had been aware of such issues. However, according to the recorded instruments, prior to the closing of the sale of the property from Edward Wallace to BSD-M, Edward Wallace was no longer the record owner of the property. Furthermore, on the date of the closing, the “confirmation deed” purporting to confirm the conveyance from the plaintiff to Edward Wallace had not yet been executed. BSD-M’s submissions, therefore, failed to eliminate all triable issues of fact as to whether its reliance on the plaintiff’s conduct was justified (citations omitted). In any event, the plaintiff raised a triable issue of fact in opposition by submitting evidence that BSD-M should have been alerted to potential defects in the chain of title (citation omitted).”).

CPLR 214(6) - Continuous representation

Cordero v. Koval Retjig & Dean PLLC, 151 A.D.3d 587, 57 N.Y.S.3d 145 (1st Dep’t 2017) (“The claim for malpractice accrued when defendants failed to timely file a notice of claim (citation omitted) upon the City of New York and the New York City Department of Transportation after plaintiff was allegedly injured in a fall from his motorcycle because he struck a defectively-placed construction plate in the road (citation omitted). However, the evidence raised triable issues whether the malpractice statute of limitations (citation omitted) was tolled under the continuous representation doctrine. Mark Koval, an attorney formerly employed by defendant law firm, joined another law firm at or about the time plaintiff’s personal injury case was transferred to such new law firm. Defendants admit that plaintiff’s case was transferred to the new firm, and Koval does not deny having worked on the case at either the old or new firm (citations omitted). Although Koval claims he subsequently left the new firm and did not take plaintiff’s case with him, there is

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. no evidence that plaintiff was ever informed of, or had objective notice of, Koval’s departure such as to end the continuous representation circumstance and the tolling of the statute of limitations (citations omitted).”).

CPLR 214(6) - Continuous representation doctrine is limited to ongoing representation pertaining specifically to matter in which the attorney committed the alleged malpractice; it is not applicable to a client's continuing general relationship with a lawyer.

Davis v. Cohen & Gresser, LLP, 160 A.D.3d 484, 74 N.Y.S.3d 534 (1st Dep’t 2018) (“The documentary evidence establishes that following decedent's death, defendant did not represent the estate in the Devine action. The retainer agreements executed with defendant after the decedent's death were explicitly limited to representing the estate in other litigation and not the Devine litigation. In addition, the evidence demonstrated that following decedent's passing defendant never entered an appearance on the estate's behalf while other law firms were substituted as counsel in the Devine action, made a motion to substitute the estate as plaintiff, and appeared on behalf of the estate, and ultimately settled with the Devine parties in May 2014 (citation omitted). Further, the continuous representation doctrine does not apply where there is only a vague ‘ongoing representation’ (citation omitted). For the doctrine to apply, the representation must be specifically related to the subject matter underlying the malpractice claim, and there must be a mutual understanding of need for further services in connection with that same subject matter (citation omitted). . . . The fact that defendant represented the estate in related matters is not sufficient to establish continuous representation, as these matters were sufficiently distinct as to not be ‘part of a continuing, interconnected representation’ (citations omitted). The continuous representation doctrine is limited to ongoing representation ‘pertain[ing] specifically to the matter in which the attorney committed the alleged malpractice’ and ‘is not applicable to a client's ... continuing general relationship with a lawyer’ (citation omitted). Nor is the fact that defendant represented decedent's son personally in the Devine action sufficient, as he is a separate client.”).

CPLR 214(6) -There is no indication of an ongoing, continuous, developing and dependent relationship between the client and the attorney or mutual understanding of the need for further representation on the specific subject matter underlying the malpractice claim

Knobel v. Wei Group, LLP, 160 A.D.3d 409, 70 N.Y.S.3d 839 (1st Dep’t 2018) (“The motion court correctly determined that the legal malpractice claim is barred by the three-year statute of limitations (citation omitted). No triable issue of fact exists as to whether the doctrine of continuous representation tolled the statute of limitations. It is undisputed that on March 12, 2012, plaintiff Steven M. Knobel sent defendant Eric Wei an email directing Wei ‘to cease all [ ] work’ and that shortly thereafter, Knobel sent an email to the court indicating his desire to appear pro se. Contrary to plaintiffs' contention, there is no indication of ‘an ongoing, continuous, developing and dependent relationship between the client and the attorney’ or a ‘mutual understanding of the need for further representation on the specific subject matter underlying the malpractice claim’ after March 12, 2012 (citation omitted). Plaintiffs' argument that the billing invoices show that defendants continued to represent them up until and after March 19, 2012 is unpersuasive. The invoices in the record do not indicate that after March 12, 2012 defendants performed any substantive legal work or provided any legal advice on the matters which plaintiffs allege

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. defendants committed malpractice (citation omitted). Rather, the invoices show that plaintiffs were billed for work pertaining to communications with the court, client, and subsequent counsel, which did not toll the statute of limitations (citation omitted).”).

CPLR 214-a - Medical, dental or podiatric malpractice actions – two years and six months

CPLR 214-a

David L. Ferstendig, Bitter Split in Court of Appeals on Application of Continuous Treatment Doctrine, 689 N.Y.S.L.D. 1-2 (2018)

Bitter Split in Court of Appeals on Application of Continuous Treatment Doctrine

Majority and Dissent Disagree As To Whether There Was Continuous Treatment, as Opposed to a Continuous Diagnosis, Continuous Relationship, or a Chronic Condition

We have touched on the continuous treatment doctrine on several occasions, most recently in the October 2017 edition of the Digest. Here, we deal with the decision in Lohnas v. Luzi, 30 N.Y.3d 752, 71 N.Y.S.3d 404, 94 N.E.3d 892 (2018), in which the Court of Appeals split bitterly on the doctrine’s application.

Medical, dental, and podiatric malpractice actions are governed by a two-and-a-half-year statute of limitations, running from the act, omission, or failure. CPLR 214-a. The continuous treatment doctrine, however, defers accrual of the limitation period to the "last treatment where there is continuous treatment for the same illness, injury or condition which gave rise to the said act, omission or failure." Id. at ∗2.

In Lohnas, beginning in 1998, the plaintiff received treatment from the defendant for chronic shoulder problems. In 1999, the plaintiff underwent surgery with the defendant, and over the coming year she returned to the defendant for five post-operative visits. After a scheduled one year post-surgery appointment, plaintiff did not return to the defendant until 19 months later, when she experienced shoulder pain. A second surgery following injections occurred in January 2002; there was a postoperative visit in April 2002; and a September 2003 doctor’s appointment after plaintiff’s shoulder injury was aggravated. Thirty months then passed without any treatment. Plaintiff returned in April 2006 because of continued pain, even though she "‘had gotten discouraged with [defendant]’ but ultimately returned to him because defendant ‘was all [she] had.’" Id. at ∗1. Following x-rays, defendant referred the plaintiff to his partner for a third surgery, because he was no longer performing shoulder surgeries. Although plaintiff consulted with the defendant’s partner, she instead began visiting a new orthopedic surgeon in July 2006.

The plaintiff commenced this action in September 2008, alleging that the defendant negligently performed the 1999 surgery and failed to diagnose the problematic surgery, leading to continued difficulties with her shoulder and the second surgery. The defendant moved for partial summary judgment, seeking dismissal of all claims relating to alleged malpractice occurring before March

2006 on statute of limitations grounds. The trial court denied the motion, finding issues of fact as to whether the continuous treatment doctrine applied. The Appellate Division affirmed.

A narrow majority of the Court of Appeals (4-3) affirmed. It found that there were material issues of fact as to whether the plaintiff and the defendant intended a continuous course of treatment. The majority dismissed the defendant’s argument that the gaps between plaintiff’s visits and "the ‘as needed’ basis for scheduling some of those appointments" negated the application of the doctrine. Id. at ∗2. Instead, it stressed that the plaintiff’s visits to the defendant over a seven-year period for her shoulder, which included two surgeries, were for the same related illness or injury. Plaintiff accepted defendant’s referral for a third surgery. She did not seek a second opinion and continued to see the defendant for care, notwithstanding the fact that she was "feeling discouraged" with defendant’s treatment. Finally, the majority noted that with respect to the 30-month gap in treatment,

we have previously held that a gap in treatment longer than the statute of limitations "is not per se dispositive of defendant’s claim that the statute has run." To the extent that lower courts have held to the contrary, those cases should not be followed (citations omitted).

Id.

The dissent insisted that an essential element was missing in order to apply the continuous treatment doctrine: continuing efforts by the doctor to treat a particular condition. Here, the plaintiff was not undergoing continuous treatment; the defendant told the plaintiff to return "as needed." During the 30- month gap, the plaintiff did not seek corrective treat ment from the defendant. The dissent reviewed the public policy concerns behind the continuous treatment doctrine: a doctor’s continuous treatment to correct a patient’s unresolved problems should not be interrupted by the filing of a lawsuit, and a patient undergoing such treatment should not be forced to sue her doctor in a timely fashion during treatment. The dissent felt that when there is no continuous treatment, as it concluded was the case here, these policy considerations actually cut the other way:

a plaintiff whose surgery and follow-up appointments have been completed, who has been discharged from the hospital, returns to normal life activities, and still suffers "terrible" pain, is on notice that something may be wrong, and is required to take steps to determine whether she has a claim — including by consulting a different doctor if necessary — and file it within the prescribed period.

Id. at ∗3.

The dissent maintained that the majority opinion undermined prior decisions of the Court, and risked expanding the limitation period indefinitely,

so long as a plaintiff can establish that she suffers from the same condition or injury and believed she had no other option than to continue to see the same physician.

The decision also vitiates the doctrine’s timeliness requirement, which bars the toll as a matter of law where, as here, a gap in treatment exceeds any reasonable interpretation of timely (citation omitted).

Id.

It emphasized that the continuous treatment doctrine cannot apply if there is only a continuing diagnosis or a continuous relationship between the doctor and the patient. It requires continuous treatment. The dissent suggested that the majority decision could require a doctor, upon the conclusion of treatment, to send a letter to the patient advising him or her never to return, so as to commence the limitation period (a result the dissent characterizes as "ghastly"). This conclusion was dismissed by the majority as "unwarranted." Moreover, the majority read the dissent as unfairly obligating a plaintiff (particularly one with limited resources) to seek a second opinion, and placing the burden on the plaintiff to "change doctors by a certain time or risk being blamed, as a matter of law, for the extent of her injury." Id. at ∗2.

CPLR 214-a

David L. Ferstendig, Majority of Court of Appeals Holds That Wrongful Birth Claim Accrues Upon Infant’s Birth, 687 N.Y.S.L.D. 1 (2018)

Majority of Court of Appeals Holds That Wrongful Birth Claim Accrues Upon Infant’s Birth

Dissent Believes Majority’s Interpretation Contravenes the Plain Meaning of the Statute

In the February 2016 edition of the Law Digest, we reported on the First Department’s decision in B & F v. Reproductive Medicine Assocs. of New York, LLP, 136 A.D.3d 73 (1st Dep’t 2015), holding that a wrongful birth cause of action accrues upon an infant’s birth. Recently, a majority of the Court of Appeals affirmed. 2017 N.Y. Slip Op. 08712 (December 14, 2017).

The Court of Appeals was actually dealing with the appeal of two separate cases. However, their fact patterns were essentially the same. They were medical malpractice actions, in which it was alleged that the defendants failed to do adequate genetic screening of an egg donor in connection with an in-vitro fertilization. The parents did not know that the egg donor was a carrier of Fragile X, a chromosomal abnormality, which produces intellectual disabilities and other deficits, particularly in males. Subsequently, one of the couples gave birth to an infant with the Fragile X mutation. The other gave birth to twins, one of which had Fragile X.

The parents’ claim being asserted here was for "wrongful birth," seeking recovery for

their past and future "extraordinary financial obligations relating to the care" of that child during his or her minority. To recover such damages on a wrongful birth cause of action, "the parents must establish that malpractice by a defendant physician deprived them of the opportunity to terminate the pregnancy within the legally

permissible time period, or [as alleged here] that the child would not have been conceived but for the defendant’s malpractice" (citations omitted).

136 A.D.3d at 77.

The issue at hand was whether the claims were timely and that hinged on when the cause of action accrued. The defendants argued that the limitation period began to run when the malpractice was allegedly committed (that is, the date the embryos were implanted). The plaintiffs countered that the statute of limitations accrued on the date of birth.

A majority of the Court of Appeals agreed with the plaintiffs that "due to its unique features," the wrongful birth cause of action accrued upon the birth of the child, and was thus timely. The Court found that, until the alleged malpractice results in the birth of a child, there can be no extraordinary expenses claim. Moreover, before birth it cannot be determined whether the plaintiffs will incur such extraordinary expenses. The Court reasoned that

[d]ue to these unique circumstances, the cause of action accrues upon the birth of an infant with a disability. This date appropriately balances the competing statute of limitations policy concerns—it gives parents a reasonable opportunity to bring suit while at the same time limiting claims in a manner that provides certainty and predictability to medical professionals engaged in fertility treatment and prenatal care (citations omitted).

2017 N.Y. Slip Op. 08712 at ∗4

Responding to the dissent, the majority asserted that nothing in the legislative history of CPLR 214-a— which governs the statute of limitations in medical malpractice actions and contains its own exceptions, including the continuous treatment doctrine and the foreign object rule— "suggests an intent to constrict judicial authority to otherwise define when a cause of action accrues." Id. at ∗5.

It stressed that "this is not the typical medical malpractice" and that in the past it had similarly "confronted a situation that falls outside the contours of CPLR 214-a, and reached a similar result." Id. at ∗6. The majority was referencing the Court’s decision in LaBello v. Albany Med. Ctr. Hosp., 85 N.Y.2d 701 (1995), where it was held that "an infant plaintiff’s medical malpractice cause of action, premised on alleged injurious acts or omissions occurring prior to birth, accrues on the earliest date the injured infant plaintiff could juridically assert the claim and sue for relief, that is, the date of being born alive." Id. at 703.

The dissent, written by Judge Garcia, maintained that the majority created a third exception to CPLR 214- a and its "date of birth" accrual contravened the statute’s explicit accrual from "the act, omission or failure complained of"; CPLR 214-a did not merely codify the common law, but instead was enacted to "‘constrict[] judicial expansiveness towards a more plaintiff friendly … rule’" and, thus, the two exceptions in CPLR 214-a are not to be expanded; the legislature has refused repeatedly to change the accrual date under CPLR 214-a in the nearly 40 years since the

Court recognized a wrongful birth cause of action; and the Court’s decision in LaBello does not justify its decision here, because in LaBello, the cause of action was being asserted on behalf of an infant and thus could not accrue "before the infant acquired the recognized legal capacity to sue." Here, the plaintiffs’ parents had the capacity to sue when the alleged malpractice occurred.

CPLR 214-a - Action timely commenced within 2½ years of the cessation of defendants' continuous treatment of plaintiff's atrial fibrillation condition

Phillips v. Buffalo Heart Group, LLP, 160 A.D.3d 1495, 75 N.Y.S.3d 732 (4th Dep’t 2018) (“We further agree with plaintiff that the record establishes that defendants provided continuous treatment to plaintiff for a condition, i.e., atrial fibrillation, until January 2, 2013; the alleged wrongful acts or omissions were related to that condition; and such treatment ‘gave rise to the . . . act, omission or failure’ complained of (citations omitted). Indeed, the record establishes that the alleged wrongful acts or omissions themselves ran continuously until January 2, 2013. We therefore reject defendants' contention that the statute of limitations began to run at the time of the first prescription of Pradaxa on January 10, 2011. We conclude that the court erred in granting the motion inasmuch as this action was timely commenced within 2½ years of the cessation of defendants' continuous treatment of plaintiff's atrial fibrillation condition (citations omitted). To the extent that the decision of this Court in Patten v Hamburg OB/GYN Group, P.C. (citation omitted) conflicts with our decision herein, it should no longer be followed.”).

CPLR 214-a - Continuous treatment doctrine – plaintiff did not anticipate further treatment

Jianfeng Jiang v. Xue Chao Wei, 151 A.D.3d 555, 54 N.Y.S.3d 278 (1st Dep’t 2017) (“We reject plaintiff’s contention that both the November and May visits were part of a continuous course of treatment such that the statutory period for filing a notice of claim was tolled (citation omitted). Although it is clear that HHC anticipated further treatment by HHC at the time of discharge in 2010, it is likewise clear that plaintiff did not (citations omitted), given his failure to show up for follow-up appointments (citations omitted) and his exclusive reliance on codefendant Xue Chao Wei (an acupuncturist who plaintiff believed to be a licensed physician) for treatment during the interim period (citations omitted). Plaintiff’s actions indicated an intention to discontinue his relationship with HHC; his return visit must therefore be deemed a ‘renewal, rather than a continuation, of the physician-patient relationship’ (citation omitted).”).

CPLR 214-a - Continuous treatment doctrine – issue of fact as to whether further treatment was explicitly anticipated by both patient and doctor

Freely v. Donnenfeld, 150 A.D.3d 697, 54 N.Y.S.3d 66 (2d Dep’t 2017) (“In the present case, Donnenfeld testified at his deposition that when he discussed treatment options with the plaintiff, he advised the plaintiff that a new treatment process was available outside the United States and that he was cautiously optimistic that, at some time in the foreseeable future, he could offer it to the plaintiff in New York. The plaintiff, who was aware that the treatment process was the subject

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. of a study aimed at obtaining FDA approval, testified at his deposition that he was waiting for the new treatment process to become available. After being told, in November 2008, that his only options were to wait for the new treatment or seek treatment outside the country, the plaintiff returned to the defendants for treatment of the same condition on March 9, 2011, and, in fact, received treatment for the same condition from the defendants continuing until December 2012. Under these circumstances, there are questions of fact as to whether further treatment was explicitly anticipated by both the defendants and the plaintiff after 2008, and whether, under the particular circumstances of this case, the March 9, 2011, visit constituted a timely return visit (citations omitted).”).

CPLR 214-a - Continuous treatment doctrine applied to doctor who left medical practice, where plaintiff continued to be treated by doctors in that practice

Matthews v. Barrau, 150 A.D.3d 836, 55 N.Y.S.3d 282 (2d Dep’t 2017) (“With respect to failure- to-diagnose cases, a physician ‘cannot escape liability under the continuous treatment doctrine merely because of a failure to make a correct diagnosis as to the underlying condition, where [he or she] treated the patient continuously over the relevant time period for symptoms that are ultimately traced to that condition’ (citations omitted). The continuous treatment doctrine may be applied to a physician who has left a medical practice by imputing to him or her the continued treatment provided by subsequent treating physicians in that practice (citations omitted).”).

CPLR 214-a - Continuous treatment doctrine applies where prescriptions being issued and refilled by doctor and there is continuing relationship with the patient

Murray v. Charap, 150 A.D.3d 752, 54 N.Y.S.3d 28 (2d Dep’t 2017) (“According to the defendant, during the relevant period prior to May 22, 2001, he prescribed and refilled the plaintiff’s prescriptions for cholesterol-lowering medications, told the plaintiff to resume his diet, explained to the plaintiff that he had elevated cholesterol and that it was a risk for heart disease, and had a conversation with the plaintiff to make sure he was taking his medication. ‘The continuous treatment rule applies to the period if prescriptions are being issued by the doctor where there is a continuing relationship’ with the patient’ (citations omitted). Therefore, the plaintiffs raised a question of fact as to whether their claims with respect to treatment prior to May 22, 2001, were barred by the statute of limitations.”).

CPLR 214-a - Continuous treatment doctrine does not apply to mother’s derivative claim

Reeder v. Health Ins. Plan of Greater N.Y., 146 A.D.3d 996, 46 N.Y.S.3d 148 (2d Dep’t 2017) (Continuous treatment toll does not extend to mother’s derivative claim. “The continuous treatment toll is personal to the child and is not available to extend the time by which the plaintiff was required to assert her derivative claim. Accordingly, the Supreme Court properly granted those branches of the motions of Solaiman and BMG which were for summary judgment dismissing the plaintiff’s derivative claims against them (citations omitted).”).

CPLR 214-a – “These root canal therapies constituted isolated and discrete procedures, and as such, the continuous treatment doctrine does not apply to the treatment of these teeth to toll the statute of limitations”

Greenstein v. Sol S. Stolzenberg, D.M.D., P.C., 156 A.D.3d 465, 64 N.Y.S.3d 884 (1st Dep’t 2017) (“Dismissal of the complaint as against Berman was proper since the alleged malpractice occurred in 2003 and 2007, and the action was not commenced until January 2016, which was well beyond the applicable statute of limitations (citation omitted). The record establishes that Berman performed root canal work on two separate occasions to address plaintiff Linda Greenstein’s emergent pain issues. These root canal therapies constituted isolated and discrete procedures, and as such, the continuous treatment doctrine does not apply to the treatment of these teeth to toll the statute of limitations (citation omitted).”).

CPLR 214-a / 2221 / 3212(a)

David L. Ferstendig, First Department Splits on Application of Continuous Treatment Doctrine, 683 N.Y.S.L.D. 2-4 (2017).

We initially treat Lewis v. Rutkovsky, 153 A.D.3d 450 (1st Dep’t 2017), for its analysis of the continuous treatment doctrine. But the case also touches on other current important issues, including my nemesis (that’s right, it’s Brill time again), discussed below.

CPLR 214-a provides for a two-and-a-half-year statute of limitation in medical, dental, or podiatric malpractice actions, running from the act, omission, or failure. The statute contains two exceptions, the foreign object rule (dealt with, for example, in edition 657 of the Digest) and the continuous treatment doctrine. With respect to the latter, it provides that the limitation period will not begin to accrue until the “last treatment where there is continuous treatment for the same illness, injury or condition which gave rise to the said act, omission or failure.” There has been much litigation in this area, and courts have generally strictly construed the language, sometimes resulting in rather inequitable results. For example, it has been held that the failure to establish a course of treatment cannot satisfy the continuous treatment doctrine. Thus, in Young v. New York City of Health & Hosps. Corp., 91 N.Y.2d 291 (1998), the continuous treatment doctrine was not applied to toll the filing of a 90-day notice of claim, finding that the plaintiff’s allegations that the defendants failed to timely diagnose and treat her cancerous breast condition were “nothing more than defendants’ failure to timely diagnose and establish a course of treatment for her breast condition, omissions that do not amount to a ‘course of treatment.’” Id. at 297.

In Lewis, a medical malpractice action, the plaintiff alleged that the defendants failed to detect, diagnose, and treat a benign brain tumor (meningioma) and ignored her repeated complaints of symptoms, including migraine headaches and blurred vision. Eventually, the plaintiff underwent a left frontal parasagittal craniotomy and suffered vision loss.

With respect to defendants’ summary judgment motions on statute of limitations grounds, the question was whether there was a continuous course of treatment. A majority of the First

Department found there to be an issue of a fact. It focused on the treatment provided for plaintiff’s “recurring and sometimes severe headaches—that were traceable to plaintiff’s meningioma,” which continued until late 2007. Lewis, 153 A.D.3d at 454. The majority rejected the dissent’s argument “that there was no evidence of regular appointments or ongoing treatment for plaintiff’s headache-related complaints.” Id. at 455. It stressed that the law does not require that a plaintiff attend “regular” appointments

for the sole purpose of treating the allegedly misdiagnosed condition. Rather, the inquiry centers on whether the treated symptoms indicated the presence of the condition that was not properly diagnosed — here, a meningioma that gave rise to plaintiff’s severe headaches and partial loss of vision, both of which Dr. Rutkovsky undertook to treat by, among other things, prescribing reading glasses (citations omitted).

Id.

The dissent pointed out that some of the plaintiff’s visits to the doctor were for routine annual checkups; that there were gaps in treatment (for example, between 1999 and 2004); that there was no evidence during the plaintiff’s 2004 and 2006 visits that there was an explicit anticipation by both doctor and patient of further treatment; and that “it appear[ed] plaintiff’s complaints of headaches were isolated and not part of a continuous course of treatment.” Id. at 458.

In sum, plaintiff complained of headaches and/or vision problems on five separate occasions with long gaps in between during approximately 30 visits to Dr. Rutkovsky and over a period of close to a decade. Clearly, this set of circumstances cannot support a continuous course of treatment for plaintiff’s sporadic complaints of headache.

Id.

The dissent maintained that plaintiff’s equivocal self-serving deposition testimony, which was contradicted by documentary evidence, did not create an issue of fact -

Here, plaintiff’s bare, equivocal statements of the times she saw Dr. Rutkovsky during this time period concerning complaints of headache, contradicted by the medical records, is insufficient to raise a factual issue concerning continuous treatment. Moreover, plaintiff does not connect these purported visits between January and June 2007 to her documented visit in September 2007, or otherwise raise an issue regarding a continuing course of treatment for headaches.

Id. at 459.

My Good Friend, Mr. Brill (CPLR 3212)

A preliminary issue in Lewis was the timeliness of defendants’ summary judgment motions. The relevant PC order provided that: “Motions for Summary Judgment and/or other dispositive motions shall be made by order to show cause no later than 60 (sixty) days from the filing of the Note of Issue, unless the Court directs otherwise.” Apparently, the defendants filed their motions via order to show cause with the clerk’s office in a timely fashion, but because of Winter Storm Juno the courts closed early and were closed the following day. Thus, the orders were not signed until two to three days after the summary judgment motion deadline. Notwithstanding these circumstances, the trial court found the motions to be untimely, because “neither movant addressed the issue of good cause.” Id. at 452–53. As the Appellate Division noted, in reversing on this issue:

No party disputes that, on the day the orders would usually have been processed and timely signed, inclement weather from Winter Storm Juno created a “state of emergency” and caused the early closure of the courts; indeed, because of the storm, the Governor signed an executive order suspending legal deadlines.

Id. at 453.

Moreover, the Appellate Division expressly found that “even if we were to find that the orders were untimely” the weather conditions and court closing provided “good cause” for the minimal delay. Id. at 454.

This preliminary issue was ultimately resolved in a favorable manner. However, it again resulted in a waste of resources, time, and money because of the trial court’s strict adherence to the well- intended decision in Brill v. City of New York, 2 N.Y.3d 648 (2004), with respect to a very short delay beyond the control of the parties. The orders to show cause were delivered to the court in a timely fashion, and there was a weather emergency resulting in court closings and an executive order suspending legal deadlines. That should have been enough for the trial court to go forward and decide the motions on the merits. For those of you unfamiliar with my rant on Brill (“Take a Chill Brill”), I refer you to edition 660 at your peril.

Appeal of Order Denying Leave to Reargue (CPLR 2221)

Practitioners presented with an unfavorable decision sometimes move to reargue. Holding off on an appeal until the reargument motion is decided, rather than appealing from the original order, presents certain dangers. While the denial or grant of a motion for leave to renew is appealable, only an order granting a motion to reargue is appealable. What sometimes becomes confusing when reading the case law in this area is what is meant by the denial of a motion to reargue. The nomenclature is important. CPLR 2221 talks in terms of a motion for leave to renew or to reargue. That is because these motions are really a two step-process: will the court agree to hear the motion in the first place (and thus grant leave) and, if so, will the court adhere to or reverse its original order? Only an order denying leave to reargue is non-appealable. If the court grants reargument, but adheres to its original decision, that order is an appealable paper. Some decisions, however, are not crystal clear as to what type of “denial” is involved. In Lewis, the court found that the order determining the defendants’ motion to reargue was an appealable paper:

Here, however, although the motion court purported to deny the motion to reargue, it nonetheless considered the merits of defendants’ argument that the inclement weather on the motion’s due date provided good cause for the delay. As a result, the court, in effect, granted reargument, then adhered to the original decision (citation omitted).

Lewis, 153 A.D.3d at 453.

Regardless, good practice is always to serve and file your notice of appeal (and any supplementary papers required by the appellate court) from the original order in a timely fashion.

If leave to reargue is denied, you are protected. If leave is granted, and the court adheres to its original decision, you should file another notice of appeal from the order determining the reargument motion. In the rare instance where the motion to reargue is granted, thereby vitiating the need for the original appeal, all you have wasted is the limited amount of time and effort in protecting your rights with respect to the original order. Not a stiff price to pay, especially taking into account the unlikelihood that you will be successful on the motion to reargue. It also will prevent sleepless nights and perhaps a call to your insurance carrier!

CPLR 214-a - Foreign object rule did not apply to capsule camera

Leace v. Kohlroser, 151 A.D.3d 707, 55 N.Y.S.3d 434 (2d Dep’t 2017) (“The capsule camera at issue herein was used diagnostically to visualize the condition of the plaintiff’s intestines. It was not used or even introduced into the plaintiff’s body in the course of a surgical procedure. Rather, the capsule camera was knowingly and intentionally swallowed by the plaintiff with the expectation that it would travel through her digestive system until eliminated in the regular course of digestion. Thus, the malpractice alleged against the moving defendants, the failure to recognize from the 2009 CT scan that the observed metallic object was a retained endoscopic capsule camera, and to advise the plaintiff of such, ‘is most logically classified as one involving misdiagnosis—a category for which the benefits of the ‘foreign object’ discovery rule have routinely been denied’ (citations omitted). Accordingly, the Supreme Court correctly rejected the plaintiff’s argument that the statute of limitations was tolled by the foreign object discovery rule so as to render the cause of action alleging malpractice timely.”).

CPLR 214-c- Discovery statute of limitations

CPLR 214-c – Toxic torts- because plaintiffs claim no additional damage to their facility since asbestos was introduced, there were no “latent effects”

All Craft Fabricators, Inc. v. Syska Hennessy Group, Inc., 144 A.D.3d 435, 39 N.Y.S.3d 783 (1st Dep’t 2016) (“Because the parties have no contractual relationship with each other, the claim must be viewed in terms of simple negligence (citation omitted), with accrual occurring within three years of the date of injury (citation omitted), rather than a claim for professional negligence, which

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. generally accrues upon the completion of the work at issue (citation omitted). We reject defendant’s position that the date of injury was in January 2012 when the asbestos-laden doors and panels were delivered to the facility. Until plaintiffs’ personnel actually unsealed the wooden crates that the doors and panels were encased in and cut into the material, any contamination of plaintiffs’ facility had not yet occurred. Nevertheless, plaintiffs’ contention that the date of injury was, at the earliest, May 29, 2012, exactly three years before they commenced the action, when they first noticed what they believed to be asbestos, is unavailing. ‘[T]he damage that [plaintiffs] are seeking to undo’ is not the fact that they discovered asbestos, but the fact of its incorporation in their buildings’ (citation omitted). The record makes clear that, while plaintiffs may have first noticed asbestos on May 29, they exposed the facility to it earlier that month. CPLR 214-c does not avail plaintiffs. As they claim no additional damage to their facility since the asbestos was introduced, it cannot be said that the injury they sustained resulted from the latent effects of exposure to asbestos (citation omitted).”).

CPLR 214-c - Statute runs from date condition or symptom is discovered or reasonably should have been discovered, not the discovery of the specific cause of the condition or symptom

Haynes v. Williams, 2018 NY Slip Op 04626 (3d Dep’t 2018) (“We find that defendants' submissions ‘were sufficient to demonstrate that plaintiff was cognizant of [his] claimed injuries, or, at a minimum, reasonably should have been, such that the action is barred by the statute of limitations’ (citation omitted). Here, if we accept that lead was the causative harmful substance, plaintiff has been aware of his injuries since early childhood, when they were first evident, and then as they continued throughout his school years and to the present day. Plaintiff argues that the statute of limitations did not commence until July 2013 when, after receiving a solicitation letter from his attorney, he became aware of his exposure to lead as a young child. This argument is without merit as ‘the statute runs from the date the condition or symptom is discovered or reasonably should have been discovered, not the discovery of the specific cause of the condition or symptom’ (citations omitted). Consequently, defendants' motions were properly granted.”).

CPLR 214-c - Discovery occurs when, based upon an objective level of awareness of the dangers and consequences of the particular substance, the injured party discovers the primary condition on which the claim is based

Sullivan v. Keyspan Corp., 155 A.D.3d 804, 64 N.Y.S.3d 82 (2d Dep’t 2017) (“‘For purposes of CPLR 214-c, discovery occurs when, based upon an objective level of awareness of the dangers and consequences of the particular substance, the injured party discovers the primary condition on which the claim is based’ (citations omitted). Here, the defendants demonstrated that they undertook extensive efforts beginning in 1999 to inform and engage with property owners potentially affected by the contamination and remediation. These efforts included, among other things, door-to-door canvassing, mailing a survey in 2002 inquiring about observable effects of contamination on properties, testing properties for contaminant intrusion, and mailing periodic newsletters and fact sheets detailing the nature and extent of the contamination and providing updates on the remediation. The defendants also held dozens of public meetings, which they advertised in advance in local media and in direct mailers, and conducted highly visible

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. remediation work. The defendants undertook these actions in conjunction with and under the supervision of the New York State Department of Environmental Conservation in accordance with an order on consent dated September 30, 1999. Although the level of the defendants’ contact with the appellants varied, the defendants satisfied their burden of establishing, prima face, that each of the appellants had an objective level of awareness of the dangers and consequences of the contamination sufficient to place them on notice of the primary condition on which their claims are based (citation omitted).”).

CPLR 215 - One year statute of limitations

CPLR 215 - Counterclaim not barred by one year statute of limitations, but was governed by continuing tort doctrine

Estreicher v. Oner, 148 A.D.3d 867, 49 N.Y.S.3d 530 (2d Dep’t 2017) (“Contrary to the plaintiff’s contention, the Supreme Court properly concluded that so much of the defendant’s third counterclaim as was based on conduct occurring prior to September 29, 2013, was not barred by the one-year statute of limitations (see CPLR 215), and that it was instead governed by the continuing tort doctrine, which permits claims based on ‘wrongful conduct occurring more than one year prior to commencement of the action, so long as the final actionable event occurred within one year of the suit’ (citations omitted). The counterclaim was supported by factual allegations that the plaintiff engaged in a continuing and concerted campaign of harassment and intimidation of the defendant that progressed from, among other things, calling the defendant, his family, and guests ethnic and racial epithets and throwing items onto his property to eventually making threats of violence, making false criminal accusations, committing assault and battery against the defendant, and continuing to engage in threatening and intimidating conduct nearly two months after the physical confrontation that is the subject of the plaintiff’s complaint (citations omitted). The final actionable event, allegedly occurring in November 2013, fell within one year of the defendant’s service of the verified answer with counterclaims (citations omitted).”).

CPLR 217- Four month statute of limitations, “[u]nless a shorter time is provided in the law authorizing the proceeding”

CPLR 217 - Accrual of claim

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. limitations to plaintiffs’ first cause of action (citation omitted), which began to run at the time that each quarterly assessment was levied and not at the time of the ‘true-up’ assessment (citations omitted), to determine that only so much of the first cause of action as challenged the quarterly assessment levied on November 5, 2009 was timely. Interpreted broadly, plaintiffs’ second cause of action challenges the constitutionality of Insurance Law former § 332 and Financial Services Law § 206, a challenge which is inappropriate for review in a CPLR article 78 proceeding (citations omitted). Thus, Supreme Court should have applied the residual six-year statute of limitations to plaintiffs’ second cause of action (citation omitted). Applying the appropriate statute of limitations, which began to run upon the enactment of the challenged statutory provisions (citations omitted), only that portion of the second cause of action alleging that Financial Services Law § 206 unlawfully delegated to the Department the power to tax is timely (see L 2011, ch 62, part A, § 1).”).

Pebble Hill Bldg. Corp. v. Madelik, 143 A.D.3d 684, 38 N.Y.S.3d 433 (2d Dep’t 2016) (“The Supreme Court correctly concluded that, although brought as a declaratory judgment action, the true nature of the instant matter is directed toward review of an agency determination and, therefore, is governed by CPLR article 78 (citations omitted). The plaintiff, in effect, seeks review of a resolution adopted by the Planning Board of the Town of Huntington dated June 17, 2009, requiring the plaintiff, as conditions of final approval of a subdivision map, to both reserve a portion of the property as a conservation area and pay a recreation fee. Since the resolution was filed with the office of the Town Clerk on June 22, 2009, this action, commenced in December 2010, was time-barred (citations omitted).”).

Matter of Tirado v. Board of Trustees of N.Y. City Fire Dept. Pension Fund, Subchapter 2, 142 A.D.3d 709, 37 N.Y.S.3d 295 (2d Dep’t 2016) (“Contrary to the appellants’ contention, the proceeding was timely commenced within four months of the October 2, 2012, determination denying her request for prospective surviving spouse pension benefits (citations omitted). The October 2, 2012, letter was the first and only unambiguously final decision sent to the petitioner regarding her claim for surviving spouse pension benefits (citations omitted). Although the petitioner was notified in 2003 that pension benefits would commence being paid to the minor children, that notification did not advise the petitioner of the Fund’s current position that, once such payments to the children began, they could never revert back to the petitioner even if she obtained vacatur of the default divorce judgment, nor did it address the petitioner’s claim at all.”).

CPLR 217 - Four-month statute of limitations begins to run when the determination to be reviewed becomes final and binding upon the petitioner

Matter of Singleton v. New York State Off. of Children & Family Servs., 161 A.D.3d 1357 (3d Dep’t 2018) (“The parties agree that petitioner's challenge to the classification of his injury ‘is subject to the four-month statute of limitations set forth by CPLR 217 (1), which begins to run when the determination to be reviewed becomes final and binding upon the petitioner. A determination is final and binding when two requirements are satisfied: first, the agency must have reached a definitive position on the issue that inflicts actual, concrete injury and second, the injury inflicted may not be prevented or significantly ameliorated by further administrative action or by steps available to the complaining party’ (citations omitted). Supreme Court properly found that

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the determination that petitioner's injury was not assault-related became binding upon him when he received the letter dated August 25, 2015, because it established the duration of leave to which he was entitled. Moreover, there was no possibility that subsequent agency action would prevent or ameliorate the harm claimed by petitioner inasmuch as the statutory and regulatory scheme at issue did not provide petitioner with any procedure for challenging that determination.”).

CPLR 217 - Where a party would expect to receive notification of a determination, but has not, the statute of limitations begins to run when the party knows, or should have known, that it was aggrieved by the determination

Valyrakis v. 346 W. 48th St. Hous. Dev. Fund Corp., 161 A.D.3d 404 (1st Dep’t 2018) (“[T]he first cause of action is barred by the statute of limitations. A proceeding challenging an action taken by a cooperative corporation must be commenced within four months after the action is final (CPLR 217[1]). ‘In circumstances where a party would expect to receive notification of a determination, but has not, the Statute of Limitations begins to run when the party knows, or should have known, that it was aggrieved by the determination’ (citation omitted).”).

CPLR 217 - No final determination, no exhaustion of administrative remedies, no actual, concrete injury

David L. Ferstendig, Once, Twice, Three Times a Maybe, 677 N.Y.S.L.D. 2 (2017).

The issue in Matter of East Ramapo Cent. Sch. Dist. v. King, 2017 N.Y. Slip Op. 02360 (March 28, 2017), related to a challenge brought by a local educational agency, the plaintiff East Ramapo Central School District (“the District”), to a determination of the State Education Department, a state education agency (“the State”). The State regulates the District’s compliance with the requirements of the Individuals with Disabilities Education Act (the “IDEA”).

To receive IDEA funding, the State must establish policies and procedures to assure that students with disabilities receive “a free appropriate public education in the least restrictive environment and an individualized education program tailored to their unique needs, and that these students and their parents are afforded certain procedural safeguards.” Matter of East Ramapo Cent. Sch. Dist. v. King, 130 A.D.3d 19, 21 (3d Dep’t 2015). The District’s receipt of IDEA funding depends on its annual submission of a plan that assures that the District is complying with the State Education Department’s policies and procedures. Here, in reviewing various student records, the State determined that the District’s dispute resolution practices violated state and federal law and directed the District to take corrective measures. The District brought this Article 78 proceeding challenging the State’s determination on the ground that its findings were unsupported by substantial evidence and were based on an erroneous construction of the IDEA.

The trial court dismissed the petition on the merits. The Appellate Division affirmed, but on the ground that Congress did not provide the District with a private right of action under the IDEA to challenge the State’s determination. The court found the IDEA did not expressly confer such a private right of action and there was no evidence that Congress intended to create such a right.

The Court of Appeals affirmed, but yet again on a different ground. The Court did not decide the issue as to whether the District had a private right of action. Instead, it assumed it did, but found that the State had not made a final determination, that the District had not established that it had exhausted its administrative remedies, and that the District was “unable to articulate any actual, concrete injury that it has suffered at this juncture.” 2017 N.Y. Slip Op. 02360 at ∗2.The Court noted that although the State had advised the District that its failure to comply could result in further enforcement actions, including the withholding of funds, the State had not made a final decision to withhold funds.

So, after three unsuccessful attempts, the District is left with a ruling that it cannot bring the proceeding at this point and with no assurances that if and when those impediments to finality are removed, it has a private right of action under the IDEA.

CPLR 217/ Article 78 - Petitioner’s request for reconsideration did not toll the statute of limitations

Matter of Mercado v. Rodriguez, 153 A.D.3d 1534, 60 N.Y.S.3d 699 (3d Dep’t 2017) (“Inasmuch as petitioner did not commence the instant CPLR article 78 proceeding within four months of receiving the June 2015 administrative determination as required, Supreme Court properly dismissed this proceeding as time-barred by the statute of limitations (citations omitted). Further, contrary to his contention, petitioner’s request for reconsideration did not toll or revive the statute of limitations (citations omitted). Accordingly, the merits of petitioner’s claims are not before us.”).

CPLR 217 - City’s letter reiterating earlier position did not serve as basis to extend statute of limitations

St. John’s Riverside Hosp. v. City of Yonkers, 151 A.D.3d 786, 58 N.Y.S.3d 51 (2d Dep’t 2017) (“Here, the City established that, although the hospital, through UtiliSave, was notified by letter dated September 20, 2013, of its determination rejecting the hospital’s request for an adjustment of its water bills for services rendered prior to December 30, 2010, the hospital failed to commence this proceeding until October 10, 2014, thereby rendering this proceeding time-barred under the four-month statute of limitations applicable for CPLR article 78 proceedings (citation omitted). Consequently, the City established its prima facie entitlement to judgment as a matter of law dismissing the petition as time-barred (citations omitted). In opposition, the hospital failed to raise a triable issue of fact (citation omitted). The City’s issuance of a check to the hospital related to reimbursement, although subsequent to its September 20, 2013, determination, was in accordance with its determination that it would only reimburse the hospital for overbilling relating to services provided after December 30, 2010. Further, the City’s June 2014 correspondence merely reiterated its earlier position set forth in the September 20, 2013, letter and did not serve as a basis to extend

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the statute of limitations or render the September 20, 2013, determination nonfinal (citations omitted).”).

CPLR 217 - But limitation period extended where agency conducts fresh and complete examination of the matter based on newly presented evidence

Matter of Kaneev v. City of New York Envtl. Control Bd., 149 A.D.3d 742, 52 N.Y.S.3d 107 (2d Dep’t 2017) (“Generally, a request for discretionary consideration does not serve to extend the statute of limitations or change a final determination into a nonfinal one (citation omitted). ‘However, where the agency conducts a fresh and complete examination of the matter based on newly presented evidence,’ an aggrieved party may seek review in a CPLR article 78 proceeding commenced within four months of the new determination’ (citations omitted). Here, the ECB conducted a fresh and complete examination of the matter in response to the petitioner’s October 21, 2013, letter, in which he sought dismissal of the March NOVs due to the ECB’s dismissal of the June NOV. In its responsive letter to the petitioner dated November 8, 2013, the ECB expressly stated that the rejection of the appeal would become final on November 18, 2013. Thus, contrary to the Supreme Court’s finding that the ECB’s determination became final on September 4, 2008, it actually became final on November 18, 2013. Nonetheless, the proceeding was time-barred since the petitioner commenced this proceeding on April 8, 2014, more than four months after the determination became final on November 18, 2013.”).

CPLR 217 - Constructive notice test

Matter of Knavel v. West Seneca Cent. Sch. Dist., 149 A.D.3d 1614, 53 N.Y.S.3d 731 (4th Dep’t 2017) (“Initially, we and our dissenting colleagues agree that the ‘determination to be reviewed’ in this proceeding is the decision embodied in the undated letter sent on June 5, 2014 (citation omitted)…. Respondents contend that the date of mailing, rather than the date of receipt by petitioners, of the undated letter to petitioners notifying them of the discontinuance of their participation in the District’s health insurance plan, was the event which began the running of the statute of limitations. In order to apply the date of mailing to the analysis, which involves a constructive notice test, it is necessary to make the legal conclusion, as a threshold matter, that the determination at issue was ‘quasi-legislative’ in nature (citations omitted). Respondents contend that the undated letter is properly characterized as a ‘quasi-legislative’ decision, that actual notice is not required, and that constructive notice by mailing was sufficient to commence the four-month limitations period . . . We thus conclude that respondents failed to meet their burden of establishing that the challenged determination was ‘quasi-legislative’ and, therefore, that the ‘readily ascertainable’ constructive notice test should be applied herein (citations omitted).”).

CPLR 217 - Unreasonable delay in making demand

Matter of Granto v. City of Niagara Falls, 148 A.D.3d 1694, 51 N.Y.S.3d 714 (4th Dep’t 2017) (“[T]he four-month limitations period of CPLR article 78 proceedings has been treat[ed] . . . as a measure of permissible delay in the making of the demand’ ‘ (citation omitted). Here, petitioners asserted that they became aware that they could be designated detectives under Civil Service Law § 58 (4) (c) (ii) when Supreme Court granted such relief to similarly-situated members of the

NFPD in September 2012 (citation omitted). Petitioners’ demand, therefore, should have been made no later than January 2013, but petitioners did not make their demand to be designated as detectives until March 2014, which was well beyond four months after they knew or should have known of the facts that provided them a clear right to relief (citation omitted). Contrary to petitioners’ contention in appeal No. 1 that they had a reasonable excuse for the delay in making the demand, there was nothing about the pendency of the Sykes proceeding that should have led petitioners to conclude that their own proceeding did not have merit. In addition, the self-serving affidavit submitted by petitioners in opposition to the motion, in which they claimed that they had feared retaliation if they demanded designation as detectives, is based solely upon conclusory and speculative allegations, and thus does not substantiate their assertion that they had a reasonable excuse for the delay. We therefore conclude that ‘it was [well] within the court’s discretion to determine that petitioner[s] unreasonably delayed in making the demand’ (citations omitted).”).

CPLR 217 - Different statute of limitations applied to different causes of action

New York Ins. Assn., Inc. v. State of New York, 145 A.D.3d 80, 41 N.Y.S.3d 149 (3d Dep’t 2016) (“Plaintiffs’ first cause of action attacks the manner in which the Director of the Budget and defendant Superintendent of Financial Services (and previously the Superintendent of Insurance) implemented Insurance Law former § 332 and Financial Services Law § 206 — in essence, whether they acted arbitrarily and capriciously or in excess of their authority by including the costs of the sub-allocated programs in the annual assessments collected during fiscal years 2008-2009 through 2012-2013 — and, therefore, could have been advanced in a CPLR article 78 proceeding (citations omitted). Accordingly, Supreme Court properly applied a four-month statute of limitations to plaintiffs’ first cause of action (citation omitted), which began to run at the time that each quarterly assessment was levied and not at the time of the ‘true-up’ assessment (citations omitted), to determine that only so much of the first cause of action as challenged the quarterly assessment levied on November 5, 2009 was timely. Interpreted broadly, plaintiffs’ second cause of action challenges the constitutionality of Insurance Law former § 332 and Financial Services Law § 206, a challenge which is inappropriate for review in a CPLR article 78 proceeding (citations omitted). Thus, Supreme Court should have applied the residual six-year statute of limitations to plaintiffs’ second cause of action (citation omitted). Applying the appropriate statute of limitations, which began to run upon the enactment of the challenged statutory provisions (citations omitted), only that portion of the second cause of action alleging that Financial Services Law § 206 unlawfully delegated to the Department the power to tax is timely (see L 2011, ch 62, part A, § 1).”).

CPLR 217 - Action untimely filed more than 4 months after resolution was filed

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. filed with the office of the Town Clerk on June 22, 2009, this action, commenced in December 2010, was time-barred (citations omitted).”).

CPLR 217 - Letter denying request for prospective surviving spouse pension benefits was first and only unambiguously final decision sent to petitioner

CPLR 217- Academic determination for which the plaintiff should have sought review in the context of a proceeding pursuant to CPLR article 78

Hernandez v. Teachers Coll., Columbia Univ., 153 A.D.3d 1241, 61 N.Y.S.3d 285 (2d Dep’t 2017) (“Here, the plaintiff’s complaint challenged her dismissal from Teachers College following her receipt of a failing grade in the elective course. This is an academic determination for which the plaintiff should have sought review in the context of a proceeding pursuant to CPLR article 78 (citations omitted). Since the plaintiff’s claims would have been barred by the four-month statute of limitations applicable to such a proceeding (see CPLR 217), the Supreme Court properly granted Teachers College’s motion to dismiss the complaint on the ground that it was time-barred (citations omitted). The plaintiff’s remaining contentions either need not be reached in light of our determination or are without merit.”).

CPLR 217 - Article 78 proceeding appropriate where challenge is directed to the procedure followed in enacting, rather than the substance of, legislation

Village of Islandia v. County of Suffolk, 2018 NY Slip Op 04025 (2d Dep’t 2018) (“A proceeding pursuant to CPLR article 78 is unavailable to challenge the validity of a legislative act (citation omitted). However, when a challenge is directed to the procedure followed in enacting, rather than the substance of, legislation, a proceeding pursuant to CPLR article 78 may be maintained (citations omitted). Here, the plaintiff's third cause of action alleged that the actions taken by the defendants in the formation of the agency were void, invalid, and illegal due to the failure of the defendants to comply with the requirements of the State Environmental Quality Review Act (citations omitted). ‘SEQRA challenges must be commenced within four months after the determination becomes final and binding upon the petitioner’ (citation omitted). The defendants' determination with regard to the formation of the agency became final and binding on the plaintiff more than four months prior to the commencement of the action. Accordingly, we agree with the

Supreme Court's determination that the plaintiff's third cause of action was time-barred pursuant to CPLR 217 (citations omitted).”).

CPLR 217 - 30-day statute of limitations applies

Matter of Woodworth v. Town of Groveland, 160 A.D.3d 1373 (4th Dep’t 2018) (“Contrary to petitioners' contention, the court properly dismissed the amended petition as time-barred, as asserted by respondents in their answer. The 30-day statute of limitations for this proceeding began to run on April 12, 2016, when the ZBA's decision was filed in the Town Clerk's office, and thus the limitations period expired before petitioners commenced this proceeding (citation omitted). We reject petitioners' contention that the statute of limitations began to run on April 18, 2016, when the ZBA filed the draft hearing minutes (citation omitted). We further reject petitioners' contention that respondents are equitably estopped from asserting the statute of limitations as a defense (citation omitted). Finally, we have considered petitioners' remaining contentions and conclude that they do not warrant reversal or modification of the judgment.”).

CPLR 217 - 60-day statute of limitations applies

Matter of Sierra Club v. Martens, 156 A.D.3d 454 (1st Dep’t 2017) (“The court correctly held that the petition was barred by the statute of limitations contained in ECL 15-0905. That section provides that an article 78 proceeding to review a decision made pursuant to article 15 of the ECL must be commenced within 60 days after service of the decision upon the applicant and others who appeared in the proceedings before DEC (citation omitted). Because this proceeding was commenced on March 23, 2015, approximately four months after DEC made the requisite service and well beyond the 60-day limitations period, it is untimely (citations omitted).”).

CPLR 217 - Challenge to university's academic and administrative decision

Dawson v. New York Univ., 160 A.D.3d 555, 72 N.Y.S.3d 433 (1st Dep’t 2018) (“Although plaintiff alleges that he was subjected to unlawful discrimination, the complaint is actually ‘a challenge to a university's academic and administrative decision[]’ (citations omitted). Accordingly, it is barred by the four-month statute of limitations for a CPLR article 78 proceeding, which is the appropriate vehicle for such a challenge (citations omitted).”).

CPLR 217 - No toll for plaintiff's invocation of defendant's voluntary student grievance procedure

Donoso v. New York Univ., 160 A.D.3d 522, 74 N.Y.S.3d 542 (1st Dep’t 2018) (“The four-month statute of limitations applicable to article 78 proceedings (citation omitted) was not tolled by plaintiff's invocation of defendant's voluntary student grievance procedure (citations omitted). Since this action was commenced some eight months after plaintiff was notified of defendant's decision to withdraw him from the JSD program, it is time-barred.”).

CPLR 217 - Gravamen of petition was that grading system was implemented in violation of lawful procedure, affected by an error of law, and arbitrary and capricious.

Matter of Broadway Barbeque Corp. v. New York City Dept. of Health & Mental Hygiene, 160 A.D.3d 719, 71 N.Y.S.3d 380 (2d Dep’t 2018) (“Here, although the 2015 petition sought injunctive and declaratory relief, the gravamen of the 2015 petition was that the grading system was implemented in violation of lawful procedure, affected by an error of law, and arbitrary and capricious. Therefore, the Supreme Court correctly determined that the four-month statute of limitations set forth in CPLR 217(1) applies to this proceeding (citations omitted).”).

CPLR 217 / 2001 - Because petitioner did not submit petition and related documentation in proper form until after the four-month statutory period had expired, trial court properly dismissed the petition as untimely

Matter of Ennis v. Annucci, 160 A.D.3d 1321, 75 N.Y.S.3d 347 (3rd Dep’t 2018) (“The four- month statute of limitations period in which to commence this proceeding began to run upon petitioner's notification of the adverse determination on July 20, 2016 (citation omitted). To that end, ‘a proceeding such as this is deemed commenced for statute of limitations purposes on the date on which the clerk of the court actually receives the petition in valid form’ (citations omitted). Because the record establishes that petitioner did not submit the petition and related documentation in proper form until after the four-month statutory period had expired, Supreme Court properly dismissed the petition as untimely (citations omitted). Contrary to petitioner's contention, the deficiencies in the initial papers submitted — which included unsigned, undated and non-original documents — are not subject to correction pursuant to CPLR 2001 so as to render the proceeding timely inasmuch as ‘[t]he failure to file the papers required to commence [a proceeding] constitutes a nonwaivable, jurisdictional defect’ (citations omitted). Accordingly, the merits of the disciplinary determination are not properly before us.”).

CPLR 217 / Article 78 – Action untimely

Save The View Now v. Brooklyn Bridge Park Corp., 156 A.D.3d 928, 68 N.Y.S.3d 478 (2d Dep’t 2017) (“Here, the Supreme Court properly determined that this action could have been brought as a proceeding pursuant to CPLR article 78 to review BBP’s and ESD’s approval of construction allegedly in violation of the MGPP (citations omitted). Although the plaintiffs are correct that the defendants failed to submit proof establishing the dates of the relevant approvals of construction which incorporated rooftop structures over the height limitations listed in the MGPP and measurement of building height from the revised base plane following Hurricane Sandy, or that the public was notified of these approvals, the approval of construction allegedly in excess of the height limitations in the MGPP was readily ascertainable by the plaintiffs, at the latest, by September 10, 2014, when the northern building reached its maximum height (citation omitted). Further, the plaintiffs failed to establish that the defendants should be estopped from asserting the statute of limitations as a defense (citation omitted). The communications between the plaintiffs and BBP were insufficient to justify an estoppel, since the government defendants did not lull the plaintiffs into believing that they would take any action with regard to the height limitations of the MGPP such that the plaintiffs’ claims would be resolved without the need for litigation (citation

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. omitted). Accordingly, this action, commenced seven months later, was untimely (citations omitted). Therefore, the Supreme Court properly granted the defendants’ motions to dismiss the complaint as untimely, denied that branch of the plaintiffs’ cross motion which was for leave to amend the complaint (citation omitted), and, upon renewal, adhered to its original determination denying the plaintiffs’ motion to preliminarily enjoin certain construction (citations omitted).”).

CPLR 217-a - One year and 90 days

CPLR 217-a - Court of Appeals adopts standard on burden of proof in showing whether a municipality or a public corporation has been substantially prejudiced

David L. Ferstendig, Court of Appeals Finds Lower Court Abused Discretion in Determining That Respondent Would be Substantially Prejudiced, 675 N.Y.S.L.D. 1-2 (2017).

When suing a municipality or a public corporation in tort, a party must first serve a notice of claim within 90 days after the claim arises. See General Municipal Law § 50-e (GML). That same section provides a mechanism by which a party can seek an extension of time to serve the notice. On such an application, the court is to evaluate whether the public corporation “acquired actual knowledge of the essential facts constituting the claim or within a reasonable time thereafter.” GML § 50- e(5). In addition, the court is to consider “all other relevant facts and circumstances.” The statute provides a nonexhaustive list of factors. A key factor for a court to address is whether the delay in serving the notice of claim “substantially prejudiced” the public corporation.

In Newcomb v. Middle Country Central School District, 2016 N.Y. Slip Op. 08581 (December 22, 2016), the petitioner’s son was hit and severely injured by a car, which fled the scene, as he was crossing an intersection near the high school he attended. Within days, the petitioner provided details of the incident to the high school, including the location and nature of his son’s injuries. Subsequently, there was a significant delay in the petitioner obtaining the police accident file, which prompted petitioner to have his own investigator take photographs of the scene. Six months after the accident, petitioner’s counsel finally received the file, which contained photographs revealing a large sign at the corner of the intersection where the accident occurred. Because of the size of the photographs, however, the lettering on the sign was illegible, resulting in an additional two-month delay in receiving enlargements of the photographs of the sign, which advertised a play at another high school within the district where the accident occurred. The photographs taken by the petitioner’s investigator did not reflect the sign, which had apparently been removed after the accident.

The petitioner timely served notices of claim on the state, town and county, but not on the school district. Five months after the expiration of the 90-day period, however, petitioner served the notice of claim on the school district, alleging that the sign obscured the view of the corner, drivers, and pedestrians, creating a dangerous condition. Simultaneously, the petitioner filed an application to serve a late notice of claim or deem the notice timely nunc pro tunc. Petitioner asserted that the school district had actual knowledge because petitioner advised his son’s high school within days of the accident as to its details and location, and the school district had the sign removed from the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. accident scene within the 90-day statutory period. Moreover, petitioner asserted that because of an ongoing criminal investigation into the hit-and-run driver, the petitioner or his counsel was prevented from obtaining photographs of the accident scene in which the subject sign was readable. Finally, petitioner argued that the school district was not substantially prejudiced by the late notice for several reasons. In addition to reiterating the school district’s placement and removal of the sign and its knowledge about the details of the accident shortly after it happened, petitioner asserted

that the School District had access to the police report and photographs from the police file that would permit the School District to reconstruct the scene and to interview witnesses; and that, except for removal of the sign by the School District, the accident scene was unchanged, and could be inspected and investigated by the School District.

Id. at ∗4.

The school district’s opposition consisted solely of an attorney’s affirmation (generally a “no-no”), asserting that the police report made no mention of the sign. Significantly, it did not rebut the petitioner’s showing of lack of substantial prejudice, other than arguing that the petitioner bore the burden and did not meet it, and that the court should infer that the passage of time created substantial prejudice as a result of fading witness memories.

The trial court examined four of the GML § 50-e(5) factors. It found that there was no nexus between petitioner’s son’s infancy and the delay, but that the delay was nevertheless justified because of the petitioner’s delay in obtaining the photographs of the scene and the severity of the injuries. In addition, the court held that the school district did not have actual knowledge of the essential facts within the statutory period because the police report failed to mention the sign and the school district did not have actual notice that the sign may have contributed to the accident. Finally, the court placed the burden on the petitioner to establish that the school district was not substantially prejudiced by the delay and found that that prejudice “could be ‘inferred’ because ‘the mere passage of time creates prejudice with respect to fading memories of witnesses.’” Id. at ∗5. Thus, the trial court held that the school district was substantially prejudiced by the late notice. The Appellate Division affirmed.

The Court of Appeals reversed, holding that the trial court’s conclusion on the substantial prejudice issue was based on an inadequate record. The Court found that the trial court had presumed that the matriculation and graduation of students and personnel changes hindered the school district’s evidence gathering. In addition, the trial court inferred that the passage of time would cause prejudice. The Court of Appeals held that such mere inferences cannot support a finding of substantial prejudice; there must be evidentiary support.

The Court noted that there was a split in the Appellate Division on the issue of which party carries the burden of proof to demonstrate that a late notice of claim substantially prejudiced the public corporation. The Court held the proper standard to be that the initial burden should be placed on the petitioner to show that late notice did not substantially prejudice the public corporation. Significantly, that “showing need not be extensive, but the petitioner must present some evidence

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. or plausible argument that supports a finding of no substantial prejudice.” Id. at *7. Once that initial showing is made, however, the respondent must come back with a particularized evidentiary showing of substantial prejudice.

Here, the trial court improperly placed the burden of proof solely on the petitioner. In addition, the respondent’s submission consisted of speculation and inferences that did not meet the particularized showing requirement. The Court concluded that the standard it was adopting struck a proper balance -

We recognize that a petitioner seeking to excuse the failure to timely comply with the notice requirement should have the initial burden to show that the public corporation will not be substantially prejudiced by the delay…. Requiring the public corporation to come forward with a particularized showing is appropriate in this context given that the public corporation is in the best position to provide evidence as to whether the late notice has substantially prejudiced its ability to defend the claim on the merits.

Id. at *8.

CPLR 217-a - Delivery of notice of claim to proper designated person

Carroll v. City of New York, 149 A.D.3d 1026, 52 N.Y.S.3d 465 (2d Dep’t 2017) (Compare Majority - “As pertinent to this appeal, General Municipal Law § 50-e(3)(a) provides that the notice of claim should be mailed ‘to the person designated by law as one to whom a summons in an action . . . may be delivered.’ Although the statute requires that the notice be mailed to the designated ‘person,’ this generally refers to the public authority or government entity itself rather than a particular person employed thereby (citations omitted). Here, there is no real dispute that simply writing ‘NYCHA’ on the envelope would have satisfied the requirements of the statute. Further, while NYCHA contends that there is no such person or entity as the ‘Comptroller of the NYCHA,’ a ‘comptroller’ is simply an officer of a municipal corporation, like NYCHA, ‘who is charged with duties [usually] relating to fiscal affairs, including auditing and examining accounts and reporting the financial status periodically’ (Black’s Law Dictionary 347 [10th ed 2014]). In any event, the minor misnomer on the envelope need not be fatal to the action, especially where, as here, the plaintiff’s attorney properly mailed the same notice of claim form to both the Comptroller and NYCHA in order to assert a claim against both the City of New York and NYCHA, and the notice of claim itself named NYCHA. Under these circumstances, we find that the envelope was properly addressed within the meaning of General Municipal Law § 50-e(3)(b) and the plaintiff properly served the notice of claim upon NYCHA within the requisite 90-day statutory period (citations omitted).” and Dissent - ‘Here, the plaintiff’s notice of claim was addressed to a person that allegedly did not exist—the Comptroller of NYCHA—and therefore was not properly addressed and not delivered to a proper designated municipal agent. These errors are fatally significant, as they contributed to the circumstances where the notice of claim was not recorded in the NYCHA service log and was instead forwarded to the Comptroller of the City of New York. Since the Office of the Comptroller of the City of New York is a separate jural entity, the notice of claim received and acknowledged by it cannot be imputed to the defendant, NYCHA

(citations omitted). Since the plaintiff failed to properly address his notice of claim to the proper municipal designee as required by statute, and the certified mail receipt card was signed by an employee of the Comptroller of the City of New York, the plaintiff failed to fulfill the purpose and intent of the statute of affording NYCHA an opportunity to investigate the claim (citation omitted).”).

CPLR 217-a - Application to file late notice of claim – factors to consider

Matter of Diegelman v. City of Buffalo, 148 A.D.3d 1692, 51 N.Y.S.3d 279 (4th Dep’t 2017) (‘In determining whether to grant claimants’ application, the court was required to consider ‘all relevant facts and circumstances,’ including the ‘nonexhaustive list of factors’ in section 50-e (5) (citations omitted). ‘[T]he presence or absence of any one of the numerous relevant factors the court must consider is not determinative’ (citation omitted). The three main factors are whether the claimants have shown a reasonable excuse for the delay, whether respondents had actual knowledge of the facts surrounding the claim within 90 days of its accrual ‘or within a reasonable time thereafter,’ and whether the delay would cause substantial prejudice to the municipality (citations omitted). Here, even assuming, arguendo, that claimants failed to provide a reasonable excuse for their delay, we conclude that the remaining factors support the court’s exercise of discretion in granting their application. Although respondents did not obtain knowledge of the facts underlying the claim until approximately nine months after the expiration of the 90-day period, we conclude under the circumstances of this case that ‘this was a reasonable time, particularly in light of the fact that respondent[s] do[ ] not contend that there has been any subsequent change in the condition of the [premises] which might hinder the investigation or defense of this action’ ‘ (citation omitted). Moreover, claimants made a sufficient showing that the late notice will not substantially prejudice respondents, and respondents failed to ‘respond with a particularized evidentiary showing that [they] will be substantially prejudiced if the late notice is allowed’ (Newcomb, 28 NY3d at 467). We therefore conclude that the court ‘properly exercised its broad discretion in granting [claimants’] application pursuant to General Municipal Law § 50- e (5)’ (citation omitted).’).

CPLR 217-a - Application to file late notice of claim granted

Camins v. New York City Hous. Auth., 151 A.D.3d 589, 55 N.Y.S.3d 247 (1st Dep’t 2017) (“Here, we find that the motion court did not improvidently exercise its discretion in granting the application to file a late notice of claim 22 days after the statutory deadline had passed, as the 22- day period was still well within the one year and 90 days within which to commence an action against defendant under CPLR 217-a.”).

CPLR 217-a - “Intentional tort causes of action asserted against municipal defendants must be commenced within the one-year-and-90-day statute of limitations contained in General Municipal Law § 50-i, which ‘takes precedence over the one-year period of limitations provided for in CPLR 215.’”

Williams v. City of New York, 153 A.D.3d 1301 (2d Dep’t 2017) (“However, the defendants correctly contend that they were entitled to dismissal of the state common-law causes of action alleging false arrest and false imprisonment on the ground that they are time-barred. General Municipal Law § 50-i(1)(c) provides, in pertinent part, that no personal injury action shall be prosecuted or maintained against a city unless it is commenced within one year and 90 days after the happening of the event upon which the claim is based. Although causes of action to recover damages for intentional torts, such as false arrest and false imprisonment, are generally subject to a one-year period of limitations (citation omitted), intentional tort causes of action asserted against municipal defendants must be commenced within the one-year-and-90-day statute of limitations contained in General Municipal Law § 50-i, which ‘takes precedence over the one-year period of limitations provided for in CPLR 215’ (citations omitted). Here, the state common-law causes of action alleging false arrest and false imprisonment accrued upon the plaintiff’s release from confinement at Rikers Island on December 11, 2009 (citations omitted). The plaintiff did not file and serve his complaint until September 20, 2011. This was well beyond the one-year-and-90-day statute of limitations (citations omitted).”).

CPLR 217-a - While one year and 90-day statute of limitations began to run upon plaintiff's commencement of the proceeding, CPLR 204 (a) tolled remainder of statute of limitations until the date that the court granted the requested relief, at which point the statute began to run once again

Kulon v. Liberty Fire Dist., 2018 NY Slip Op 04062 (3d Dep’t 2018) (“Pursuant to General Municipal Law, a plaintiff must first serve a notice of claim against a municipality within 90 days after the claim arises (citation omitted) and commence any subsequent tort action against the municipality within one year and 90 days after the claim arises (citation omitted). Because plaintiff's claims against defendants, if any, arise from the fire that occurred on February 18, 2014, he was therefore required to file and serve a notice of claim by May 19, 2014 and commence any subsequent tort action by May 19, 2015. Having failed to file and serve his notice of claim by May 19, 2014, plaintiff was permitted to, and did, commence a special proceeding seeking leave to file a late notice of claim. While the applicable one year and 90-day statute of limitations began to run on February 18, 2014, upon plaintiff's commencement of the proceeding, the provisions of CPLR 204 (a) operated to toll the remainder of the statute of limitations until the date that the court granted the requested relief, at which point the statute began to run once again (citations omitted).”).

CPLR 217-a - Notice of claim requirement does not apply when litigant seeks only equitable relief, or commences a proceeding to vindicate a public interest

Matter of Fotopoulos v. Board of Fire Commr. of the Hicksville Fire Dist., 161 A.D.3d 733 (2d Dep’t 2018) (“In general, ‘[t]he service of a notice of claim is a condition precedent to the maintenance of an action against a public corporation to recover damages for a tortious or wrongful act’ (citations omitted). However, the notice of claim requirement does not apply when a litigant seeks only equitable relief (citations omitted), or commences a proceeding to vindicate a public interest (citation omitted). Moreover, a litigant who seeks ‘judicial enforcement of a legal right derived through enactment of positive law’ is exempt from the notice of claim requirement

(citations omitted). Here, since the petitioner seeks both equitable relief and the recovery of damages in the form of back pay, the filing of a notice of claim within 90 days after his claim arose was a condition precedent to the maintenance of this proceeding (citations omitted).”).

CPLR 217-a / 2001 - Failure to file the application with the appropriate clerk (County Clerk) is fatal defect that may not be overlooked or corrected by the court pursuant to CPLR 2001

Matter of Dougherty v. County of Greene, 161 A.D.3d 1253 (3d Dep’t 2018) (“While the Supreme Court or the County Court may convert an improperly brought motion for leave to serve a late notice of claim into a special proceeding (citations omitted), the failure to file the application with the appropriate clerk — the County Clerk — is a fatal defect that may not be overlooked or corrected by the court pursuant to CPLR 2001 (citations omitted). Indeed, the filing of initiatory papers with the Clerk of the Supreme and County Courts, rather than the County Clerk, ‘has been equated to a nonfiling and, thus, 'a nonwaivable jurisdictional defect rendering the proceeding a nullity’ (citations omitted). Here, petitioner mailed her 2013 application to the Greene County Courthouse to the attention of the ‘County Lawyer Clerks Office.’ Petitioner's papers were promptly rejected by the Chief Clerk of the Supreme and County Courts in Greene County and returned to petitioner with a letter identifying several deficiencies with her papers and directing that they be mailed to the County Clerk's Office. Petitioner's failure to file her 2013 application with the proper clerk amounts to a nonwaivable jurisdictional defect, rendering the proceeding a nullity (citations omitted). Consequently, petitioner's 2015 submissions cannot relate back to her 2013 attempted application. Given that petitioner did not file an application with the Greene County Clerk prior to the expiration of the one year and 90-day statute of limitations, which expired in February 2014, Supreme Court was statutorily prohibited from extending the time in which petitioner had to serve her notice of claim upon respondent (citations omitted).”).

JURISDICTION

CPLR 301

CPLR 301 - Lack of subject matter jurisdiction

Matter of Duran v. Mercado, 155 A.D.3d 725, 64 N.Y.S.3d 90 (2d Dep’t 2017) (“The Family Court properly dismissed the mother’s petition on the ground that it lacked subject matter jurisdiction. ‘Where a different state possesses exclusive, continuing jurisdiction, New York cannot take jurisdiction unless the foreign state declines, even [if] the parties clearly no longer have a significant connection with that state’ (citations omitted). Here, the record is clear that Pennsylvania had exclusive, continuing jurisdiction over the custody dispute, as the father continued to reside in Pennsylvania and the Pennsylvania court had not determined that New York would be a more appropriate forum (citations omitted).”).

CPLR 301 - No general jurisdiction over individual

IMAX Corp. v. Essel Group, 154 A.D.3d 464, 62 N.Y.S.3d 107 (1st Dep’t 2017) (“Additionally, petitioner failed to establish that New York courts have general jurisdiction over respondent Chandra individually pursuant to CPLR 301. New York courts may not exercise general jurisdiction against a defendant under the United States Constitution or under CPLR 301 unless the defendant is domiciled in the state (citations omitted) or in an exceptional case where ‘an individual’s contacts with a forum [are] so extensive as to support general jurisdiction notwithstanding domicile elsewhere’ (citation omitted). In the present case, movant has failed to show either that Chandra was domiciled in New York or that Chandra’s contacts with New York were so extensive as to support general jurisdiction. Initially, the purchase of the apartment, even if attributable to him personally, is insufficient to establish that Chandra was domiciled in New York (citations omitted). Further, the evidence submitted by petitioner demonstrates that Chandra’s business activities in New York were undertaken on behalf of a corporate entity (citation omitted). No pretrial jurisdictional disclosure is warranted.”).

CPLR 301 - Domicile jurisdiction – look to where defendant was domiciled when the action was commenced

Chen v. Guo Liang Lu, 144 A.D.3d 735, 41 N.Y.S.3d 517 (2d Dep’t 2016) (“‘[D]omicile means living in [a] locality with intent to make it a fixed and permanent home’ (citation omitted). It is the place ‘where one always intends to return to from wherever one may be temporarily located’ (citation omitted). An individual may have multiple residences, but only one domicile (citations omitted). In making a determination as to a defendant’s domicile, examination of the defendant’s intent to permanently reside in a given locality is essential (citations omitted). In this respect, courts must look to the defendant’s intent as it existed at the time the plaintiff commenced the action (citation omitted). Where the defendant is not domiciled in New York at the time the action is commenced, New York courts lack personal jurisdiction over the defendant on that basis (citation omitted). Here, in opposing dismissal of the complaint pursuant to CPLR 3211(a)(8) for lack of personal jurisdiction, the plaintiffs failed to make a prima facie showing that the defendant was domiciled in New York at the time the action was commenced in July 2013. Evidence of the defendant’s ownership of a cooperative apartment in Queens is, on its own, insufficient to confer personal jurisdiction over him absent evidence of his intent to make the apartment his ‘fixed and permanent home’ (citations omitted). The record demonstrated that the defendant resided in Shanghai, China, while his wife and daughter resided in the cooperative apartment in Queens. It was undisputed that the defendant had not even visited New York since March 2013. Further, while the defendant’s immigration status may be indicative of an intent on the part of the defendant to reside in the United States at the time a petition for an employment-based immigrant visa was filed on his behalf in December 2009, it does not demonstrate an intent to make New York his fixed and permanent home at the time this action was commenced in July 2013, four months after his departure from the United States (citation omitted).”).

CPLR 301

David L. Ferstendig, Daimler “Doing Business” Standard Revisited, 680 N.Y.S.L.D. 1-2 (2017).

In BNSF Ry. Co. v. Tyrrell, 137 S. Ct. 1549 (2017), Robert Nelson, a North Dakota resident, brought a Federal Employers Liability Act (FELA) action against his employer, BNSF Railway Company, in a Montana state court. He alleged that he sustained personal injuries while working as a BNSF fuel truck driver. Another FELA action was brought on behalf of the deceased, Brent Tyrell, by an administrator appointed in South Dakota. There it was asserted that the deceased contracted cancer from exposure to carcinogenic chemicals while employed at BNSF. Neither plaintiff alleged that the claimed injuries related to work performed in Montana. BNSF is a Delaware corporation with its principal place of business in Texas, operating railroad lines in 28 states. Its connections to Montana include 2,061 miles of railroad track (about six percent of its total track mileage), 2,100 employees (less than five percent of its total work force), about 10 percent of its total revenue is derived from there, and it maintains one of its 24 automotive facilities in the state.

The Montana Supreme Court held that Montana courts could exercise general personal jurisdiction over BNSF. It based its decision, in part, on FELA § 56, which it determined permitted state courts to exercise personal jurisdiction over railroads “doing business” in the state. The Montana court found that BNSF was doing business under the FELA provision due to its many miles of tracks and employees within the state. It similarly held that BNSF was “found within” the state under Montana law. Significantly, the court stated that the due process limits set forth in the U.S. Supreme Court’s decision in Daimler AG v. Bauman, 134 S. Ct. 746 (2014), did not apply because Daimler did not involve a railroad defendant or a FELA claim.

The U.S. Supreme Court was unanimous in ruling that the Montana Supreme Court erred in finding that the FELA provision conferred personal jurisdiction over the defendants in state court and that the Due Process Clause was not implicated. However, the majority and the dissent disagreed on the result.

The majority, written by Justice Ginsburg, explained that FELA § 56 does not concern personal jurisdiction, but rather is a federal court venue provision, also conferring subject matter jurisdiction in FELA actions in state courts concurrent with federal courts. With respect to the Montana statute, Mont. R. Civ. P. 4(b)(1), which confers personal jurisdiction over “persons found” in Montana, the majority noted that the defendant did not contest that it was “found within” Montana. Thus, the Court’s inquiry related to whether “the Montana courts’ exercise of personal jurisdiction under Montana law comports with the Due Process Clause of the Fourteenth Amendment.” Id. at 1558. The majority concluded that BNSF’s activities in Montana did not render it “at home” under the Daimler “doing business” standard (that is, the corporation’s affiliations with the forum state are so continuous and systematic as to render it essentially “at home” in the forum state).

Daimler provided only three circumstances that satisfied the “at home” requirement - a domestic corporation, a corporation whose principal place of business is in the forum state, and the “exceptional case” where a defendant’s operations in another state “may be so substantial and of such a nature as to render the corporation at home in that State.” 134 S. Ct. 746, n. 19. The

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. paradigm case referred to in Daimler as being the “exceptional case” was Perkins v. Benguet Consol. Mining Co., 342 U.S. 437 (1952), where the war had forced the corporation’s owner to relocate the operations temporarily from the Philippines to Ohio.

The Court stressed here, as it did in Daimler, that it was required to look at the company’s activities in their entirety when it operates in many places -

[A]s we observed in Daimler, “the general jurisdiction inquiry does not focus solely on the magnitude of the defendant’s in-state contacts.” Rather, the inquiry “calls for an appraisal of a corporation’s activities in their entirety”; “[a] corporation that operates in many places can scarcely be deemed at home in all of them.” In short, the business BNSF does in Montana is sufficient to subject the railroad to specific personal jurisdiction in that State on claims related to the business it does in Montana. But in-state business, we clarified in Daimler and Goodyear, does not suffice to permit the assertion of general jurisdiction over claims like Nelson’s and Tyrrell’s that are unrelated to any activity occurring in Montana (citations omitted).

Id. at 1559.

In her dissent, Justice Sotomayor reiterated her disagreement “with the path the Court struck in Daimler.” Id. at 1560. She stated that the majority was granting

a jurisdictional windfall to large multistate or multinational corporations that operate across many jurisdictions. Under its reasoning, it is virtually inconceivable that such corporations will ever be subject to general jurisdiction in any location other than their principal places of business or of incorporation. Foreign businesses with principal places of business outside the United States may never be subject to general jurisdiction in this country even though they have continuous and systematic contacts within the United States (citations omitted).

Id.

Justice Sotomayor insisted that the focus should be on the quality and quantity of the defendant’s contacts in the state. She maintained that the majority opinion, in essence, had read the “exceptional case” exception “out of existence entirely,” limiting it only to the “exact facts” in Perkins. Id. at 1561.

In addition, the dissent opined that even if the Daimler “doing business” standard applied, the correct procedural decision was to remand the case back to the Montana Supreme Court “to conduct what should be a fact-intensive analysis under the proper legal framework.” Id. at 1560.

CPLR 301

David L. Ferstendig, Daimler “At Home” Standard as Applied to Individuals, 682 N.Y.S.L.D. 2-3 (2017).

Much has been said in this Digest and elsewhere about the impact of the United States Supreme Court decision in Daimler AG v. Bauman, 134 S. Ct. 746 (2014). The discussion has been centered primarily on a corporation’s activities in the forum state, that is, whether they are so systematic and continuous as to render it “at home.”

But how about an individual “doing business” in New York? Prior to Daimler, there was a conflict in New York State as to whether jurisdiction can be obtained over an individual while “doing business” in New York in connection with causes of action which do not arise there. The First Department holds that jurisdiction can be found in such a circumstance. See ABKCO Industries, Inc. v. Lennon, 52 A.D.2d 435 (1st Dep’t 1976). The Second Department disagrees. See Nilsa B.B. v. Clyde Blackwell H., 84 A.D.2d 295 (2d Dep’t 1981) (questioning First Department holding in ABKCO). See also Pichardo v. Zayas, 122 A.D.3d 699, 703 (2d Dep’t 2014) lv. denied, 26 N.Y. 3d 905 (2015). (“In contrast to the common-law approach to corporations, the common law, as developed through case law predating the enactment of CPLR 301, did not include any recognition of general jurisdiction over an individual based upon that individual’s cumulative business activities within the State. Since the enactment of CPLR 301 did not expand the scope of the existing jurisdictional authority of the courts of the State of New York, that section does not permit the application of the ‘doing business’ test to individual defendants (citations omitted).”).

Recently, in Lebron v. Encarnacion, 2017 U.S. Dist. LEXIS 83261 (E.D.N.Y. May 31, 2017), District Court Judge Arthur D. Spatt addressed the issue of whether an individual’s activities can render him or her “at home.” In Lebron, the plaintiff, a New York resident, brought tort claims against a Toronto Blue Jays baseball player, Edwin Encarnacion, who is a citizen and permanent resident of the Dominican Republic. The plaintiff met the defendant for the first time following a baseball game between the New York Yankees and the Blue Jays at Yankees Stadium. Their non- romantic relationship continued for several years, followed by a weekend visit to the Dominican Republic where they had sexual relations. The plaintiff later developed symptoms of sexually transmitted diseases and sued the defendant, claiming he failed to advise her that he had been infected.

The plaintiff argued that, among other things, the court had general jurisdiction over the defendant based on his regular trips to New York to play baseball against the Yankees and Mets and the fact that his agents and representatives promoted the defendant’s interests in New York.

The district court stated that while the Daimler decision discussed the “doing business” standard as it applied to a foreign corporation, “[s]imilarly, as it relates to individuals, the new inquiry focuses on whether the defendant may fairly be regarded as ‘at home’ in the forum state—a location which, according to the Second Circuit, is generally limited to that individual’s domicile.” Id. at ∗4. Noting that the defendant’s domicile was clearly not in New York, the court echoed the Daimler decision in stating that “[d]etermining whether the Defendant is ‘at home’ in this forum ‘calls for an appraisal of [his] activities in their entirety, nationwide and worldwide.’” Id. at ∗5. The court noted that the defendant was not a U.S. citizen or permanent resident alien; he never lived in New York or owned a bank account or other property here; and he is a citizen and permanent resident of the Dominican Republic with a temporary residence in Toronto during the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. baseball season. It found that the defendant’s occasional visits to New York (for an estimated 9- 12 games a year for 12 seasons) and association with a New York-based union and sports management agency did not establish that the defendant was “at home” in New York for jurisdictional purposes. Borrowing from Daimler again, the court focused on the defendant’s connections with other states -

This is especially true given that that the same evidence used to show the Defendant’s occasional visits to New York for baseball games also shows that he has, during the same time period, made a comparable number of annual trips to 16 other states and the District of Columbia for the same purpose. Viewing the Defendant’s activities “in their entirety, nationwide and worldwide,” the Court discerns no principled basis for concluding that his trips to New York are any more substantial or otherwise likely to render him “at home” in this State than any other. On the contrary, to borrow a phrase from Justice Ginsberg, after Daimler it is reasonable to presume that a professional athlete who competes in many places can scarcely be deemed at home in all of them (citations omitted).

Id.

The court rejected the plaintiff’s agency theory, finding that the Major League Baseball Players Association and Radegan Sports Management were not “primarily employed by the defendant” and are clearly “engaged in similar services for other clients.” Id. at ∗6. Thus, it held that this was not one of the “truly ‘exceptional’ occasions” justifying a finding of general jurisdiction. Id. at ∗7.

Finally, the court refused to hold that the defendant was subject to specific jurisdiction in New York under either CPLR 302(a)(2) or CPLR 302(a)(3), because neither the tort (the sexual act, that had occurred in the Dominican Republic), nor the injuries (the original event that caused the injury, the parties’ sexual intercourse, occurred in the Dominican Republic, rather than the manifestation of physical symptoms) took place in New York.

CPLR 301 / 302

David L. Ferstendig, Business Corporation Law § 1314(b) Limits on Subject Matter Jurisdiction, 680 N.Y.S.L.D. 3 (2017).

Business Corporation Law § 1314(b) (BCL) is an often overlooked limitation on subject matter jurisdiction in state court, something generally of rare concern. It provides that an action against a foreign corporation brought by another foreign corporation or a nonresident may not be maintained unless it falls within one of the five designated exceptions - where the subject contract was made or performed in New York or relates to property situated within New York at the time the contract was made; the “subject matter” of the action is in New York; the cause of action arose in New York; the defendant is subject to jurisdiction under CPLR 302; or the defendant is a foreign corporation doing business or authorized to do business in New York.

Significantly, because “subject matter jurisdiction cannot be conferred by agreement of the parties”, the parties’ consent to jurisdiction via a forum selection clause, for example, would not suffice. See Calzaturificio Giuseppe Garbuio S. A. S. v. Dartmouth Outdoor Sports, Inc., 435 F. Supp. 1209, 1211 (S.D.N.Y. 1997).

In D&R Global Selections, S.L. v. Bodega Olegario Falcon Pineiro, 2017 N.Y. Slip Op. 04494 (June 8, 2017), BCL § 1314(b) applied, requiring the Court to determine in this case whether the defendant was subject to jurisdiction under CPLR 302(a)(1). The plaintiff, a Spanish limited liability company based in Pontevedra, Spain, agreed to locate a distributor to import defendant’s wine into the United States. The defendant is a winery also located in Pontevedra. The defendant accompanied the plaintiff to New York on several occasions to meet potential distributors and to promote the defendant’s wine. Ultimately the plaintiff introduced the defendant to a New York wine importer and distributor. Subsequently, the defendant stopped paying commissions to the plaintiff, prompting this action.

The defendant failed to appear or answer, resulting in a default judgment. The defendant moved to vacate the default judgment and to dismiss for lack of subject matter and personal jurisdiction. The trial court denied the vacate motion, while not considering the motion to dismiss. The Appellate Division reversed, vacated the default judgment, but found that there were issues of fact as to whether the court had personal jurisdiction over the defendant under CPLR 302(a)(1) (transaction of business).

After the matter was remanded to the trial court, the defendant’s motion for summary judgment was denied by the court. On appeal, the Appellate Division reversed, holding that there was no jurisdiction because, although the “defendant’s visits to New York to promote its wine constitute the transaction of business,” there was “no substantial nexus between plaintiff’s claim for unpaid commissions in connection with the sales of that wine, pursuant to an agreement made and performed wholly in Spain, and those promotional activities.” 128 A.D.3d 486, 487 (1st Dep’t 2015).

The Court of Appeals reversed. It agreed with the Appellate Division that there was a transaction of business, in that the defendant “purposefully availed itself of ‘the privilege of conducting activities’” in New York. 2017 N.Y. Slip Op. 04494 at ∗2-3. The Court focused on defendant’s numerous trips to New York to attend wine industry events, its introduction to a New York-based distributor, its return to New York on at least two occasions to promote its wine, and the fact that it entered into an exclusive distribution agreement with the New York-based company to import wines into the United States.

However, contrary to the Appellate Division, the Court of Appeals found there to be a substantial relationship between the plaintiff’s claim and the defendant’s business activities in New York. In doing so, it rejected the Appellate Division’s finding that the parties’ oral agreement was performed “wholly in Spain” -

Defendant traveled to New York to attend the Great Match Event where plaintiff introduced defendant to Kobrand. Defendant then joined plaintiff in attending two

promotional events hosted by Kobrand in New York, which resulted in Kobrand purchasing defendant’s wine and, eventually, entering an exclusive distribution agreement for defendant’s wine in the United States. Those sales to Kobrand - and the unpaid commissions thereon - are at the heart of plaintiff’s claim.

Id. at *3.

CPLR 301 / 302

David L. Ferstendig, Business Corporation Law § 1314(b) Postscript, 681 N.Y.S.L.D. 4 (2017).

In the July edition of the Digest, we referred to Business Corporation Law § 1314(b) (BCL), which limits a court’s subject matter jurisdiction in actions brought by a nonresident or foreign corporation against a foreign corporation. The statute enumerates five designated exceptions. The case referenced, D&R Global Selections, S.L. v. Bodega Olegario Falcon Pineiro, 29 N.Y.3d 292, 56 N.Y.S.3d 488, 78 N.E.3d 1172 (2017), found that the defendant was subject to personal jurisdiction under CPLR 302, thereby removing the subject matter jurisdiction infirmity.

While not specifically relevant to our discussion above, practitioners should also be aware of General Obligations Law § 5-1402(1) (GOL), which provides that -

Notwithstanding any act which limits or affects the right of a person to maintain an action or proceeding, including, but not limited to, paragraph (b) of section thirteen hundred fourteen of the business corporation law and subdivision two of section two hundred-b of the banking law, any person may maintain an action or proceeding against a foreign corporation, non-resident, or foreign state where the action or proceeding arises out of or relates to any contract, agreement or undertaking for which a choice of New York law has been made in whole or in part pursuant to section 5-1401 and which (a) is a contract, agreement or undertaking, contingent or otherwise, in consideration of, or relating to any obligation arising out of a transaction covering in the aggregate, not less than one million dollars, and (b) which contains a provision or provisions whereby such foreign corporation or non-resident agrees to submit to the jurisdiction of the courts of this state.

Thus, GOL § 5-1402 expressly provides that where the underlying “contract, agreement or undertaking” involves a transaction “not less” than one million dollars and has a New York forum selection clause and a New York choice of law provision (pursuant to GOL § 5-1401), the BCL § 1314(b) subject matter jurisdiction bar does not apply.

Note also that CPLR 327(b) similarly provides that a court cannot stay or dismiss an action on forum non conveniens grounds, if those conditions are met (e.g., one million dollar transaction and the agreement between the parties has New York forum selection and choice of law provisions). For further discussion and specifically which types of contracts are impacted, see Weinstein, Korn & Miller, New York Civil Practice, CPLR ¶ 327.04 (David L. Ferstendig, LexisNexis Matthew Bender, 2d Ed.).

CPLR 302 - Specific Jurisdiction

CPLR 302

David L. Ferstendig, U.S. Supreme Court Tackles Specific Jurisdiction Issues, 681 N.Y.S.L.D. 1-2 (2017).

In the last edition of the Digest, we reported on the United States Supreme Court’s decision in BNSF Ry. v. Tyrrell, 137 S. Ct. 1549 (2017). There, the Court refused to find general or all-purpose jurisdiction over the railway company, notwithstanding significant contacts in the state.

In Bristol-Myers Squibb Co. v. Superior Court of Cal., San Francisco County, 137 S. Ct. 1773 (2017), the issue presented to the Court related to specific jurisdiction, where the claim must arise out of the jurisdictional predicate. BMS, a large pharmaceutical company, is a Delaware corporation with its headquarters in New York. It has substantial operations in New York and New Jersey, with 50 percent of its U.S. workforce there. BMS has business activities in other jurisdictions, including California where it has 160 employees, 250 sales representatives, and a small state government advocacy office. The plaintiffs claimed that they were injured as a result of their ingestion of Plavix, a prescription drug intended to thin the blood and inhibit blood clotting. Significantly, only 86 of the plaintiffs were California residents, while the remaining 592 resided in 33 other states. BMS did not develop Plavix in California, did not create a marketing strategy there, and did not manufacture, label, package, or work on the regulatory approval of the product there. All those activities were performed in New York or New Jersey. BMS did sell 187 million Plavix pills in California in the period between 2006 and 2012, resulting in $900 million in sales (approximately 1 percent of BMS’s nationwide sales revenue). However, none of the nonresident plaintiffs alleged that they had obtained Plavix through California doctors or elsewhere in California, or that they were injured or treated for their injuries in California.

The California Superior Court denied BMS’s motion to quash service of the summons on the nonresidents’ claims, 2017finding there to be general jurisdiction over BMS. The California Court of Appeal found general jurisdiction to be lacking, but held there to be specific jurisdiction. The California Supreme Court affirmed, unanimously agreeing there was no general jurisdiction. However, the Court split on specific jurisdiction. The majority agreed there was, applying a “sliding scale approach” under which “the more wide ranging the defendant’s forum contacts, the more readily is shown a connection between the forum contacts and the claim.” Id. at 1778.

A majority of the U.S. Supreme Court (8-1) reversed. The Court noted that it had to consider a variety of factors in assessing whether there was personal jurisdiction, including “the interests of the forum State and of the plaintiff in proceeding with the cause in the plaintiff’s forum of choice” (citing to Kulko v. Superior Court of Cal., City and County of San Francisco, 436 U.S. 84, 92 (1978)). Id. at 1780. It stressed, however, that the “primary concern” is “the burden on the defendant.”

The Court emphasized that

[a]ssessing this burden obviously requires a court to consider the practical problems resulting from litigating in the forum, but it also encompasses the more abstract matter of submitting to the coercive power of a State that may have little legitimate interest in the claims in question. As we have put it, restrictions on personal jurisdiction “are more than a guarantee of immunity from inconvenient or distant litigation. They are a consequence of territorial limitations on the power of the respective States.” […] “[T]he States retain many essential attributes of sovereignty, including, in particular, the sovereign power to try causes in their courts. The sovereignty of each State … implie[s] a limitation on the sovereignty of all its sister States” (citations omitted).

Id. at 1780.

For there to be specific jurisdiction, a court must find there to be an “affiliation between the forum and the underlying controversy, principally, [an] activity or an occurrence that takes place in the forum State.” Id. at 1781 (citation omitted).

The majority found that the “sliding scale approach” adopted by the California Supreme Court was inconsistent with the Court’s precedents -

Under the California approach, the strength of the requisite connection between the forum and the specific claims at issue is relaxed if the defendant has extensive forum contacts that are unrelated to those claims. Our cases provide no support for this approach, which resembles a loose and spurious form of general jurisdiction. For specific jurisdiction, a defendant’s general connections with the forum are not enough. As we have said, “[a] corporation’s ‘continuous activity of some sorts within a state … is not enough to support the demand that the corporation be amenable to suits unrelated to that activity’” (citations omitted).

Id. at 1781.

The majority noted that the California Supreme Court did not identify an adequate link between the nonresidents’ claims and California. The fact that the resident plaintiffs were prescribed, obtained, and ingested the drug in California, and allegedly shared the same injuries as the nonresidents, did not allow the State of California to assert specific jurisdiction over the nonresidents’ claims. As the Court previously stressed in Walden v. Fiore, 134 S. Ct. 1115 (2014), a defendant’s relationship with third parties in the state is insufficient in and of itself to support a finding of jurisdiction. The Court found lacking here a “connection between the forum and the specific claims at issue.” Bristol-Myers, 137 S. Ct. at 1776.

In response to the assertion of a “parade of horribles” that could result from its decision, the majority pointed out that there could be consolidated actions in New York or Delaware, where

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. there would be general jurisdiction over BMS, or residents in particular states (e.g., Texas and Ohio) could probably sue together in their home states. The Court concluded, that

since our decision concerns the due process limits on the exercise of specific jurisdiction by a State, we leave open the question whether the Fifth Amendment imposes the same restrictions on the exercise of personal jurisdiction by a federal court (citation omitted).

Id. at 1783–84.

The sole dissenter, Justice Sotomayor, stated that the majority’s decision will make it harder for plaintiffs to aggregate claims in a particular jurisdiction, will result in piecemeal litigation, and will “make it impossible to bring a nationwide mass action in state court against defendants who are ‘at home’ in different States.” Id. at 1784.

CPLR 302 - “Arising out of” requirement– there must be substantial relationship of activities to cause of action

Hall v. City of Buffalo, 151 A.D.3d 1942, 59 N.Y.S.3d 224 (4th Dep’t 2017) (“Contrary to defendants’ contention, we conclude that plaintiff made ‘a prima facie showing’ that the court has personal jurisdiction over Habib (citations omitted). As the principal and sole shareholder of NHJB, which operated a bar in New York, Habib transacted business in New York within the meaning of CPLR 302 (a) (1) (citations omitted), and we conclude that there is a substantial relationship between plaintiff’s claims and Habib’s activities in New York (citations omitted). In addition, we conclude that the exercise of personal jurisdiction over Habib comports with due process (citations omitted).”).

Leuthner v. Homewood Suites by Hilton, 151 A.D.3d 1042, 58 N.Y.S.3d 437 (2d Dep’t 2017) (“Here, the plaintiffs failed to make a prima facie showing that the defendants transacted business in New York. The plaintiffs did not rebut the evidence submitted by the defendants demonstrating that (1) the defendant Brantley Enterprises, Inc., which does business under the name Brantley Hotel Group (also named as a defendant), managed the subject hotel, which was known as Homewood Suites by Hilton (also named as a defendant), and (2) Brantley Enterprises, Inc., was a Virginia corporation with its principal office in Virginia, which did not conduct business or maintain any offices outside Virginia, and was not affiliated with any New York hotels. The plaintiffs also did not rebut the evidence demonstrating that the subject hotel was owned by nonparty Suite Venture Associates, LLC, a Virginia limited liability company with its principal office in Virginia, which did not conduct business or maintain any offices outside Virginia, and was not affiliated with any New York hotels. Contrary to the plaintiffs’ contention, even if there were other, separate hotels operating in New York under the licensed or franchised name Homewood Suites by Hilton, the plaintiffs failed to demonstrate that the defendants purposefully availed themselves of the privilege of conducting business in New York. Moreover, accepting as true the plaintiffs’ allegation that the defendants were involved in maintaining or operating a website that permitted consumers in New York to make reservations at the subject hotel in Virginia, they failed to make a prima facie showing that there was a substantial relationship

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. between the causes of action asserted in the complaint and any alleged transaction of business through that website (citations omitted).”).

America / International 1994 Venture v. Mau, 146 A.D.3d 40, 42 N.Y.S.3d 188 (2d Dep’t 2016) (‘Here, even if Kraft were considered to be the defendant’s agent for jurisdictional purposes, the plaintiffs presented no evidence that the alleged business activities in New York, conducted by Kraft on behalf of all investors including the defendant, were substantially related to or gave rise to the cause of action to recover on the note (citation omitted). Kraft’s business activities in New York were related to the operation of the joint venture. The subject cause of action arose from the defendant’s failure to pay the note when it came due. The subject claim resulted from the execution of the note in Illinois 20 years prior to the commencement of this action. This relationship is too remote and indirect to create an articulable nexus. Furthermore, the defendant’s appointment of Kraft as his agent in New York does not bear a substantial relationship to the subject matter of this action. ‘These are . . . merely coincidental’ occurrences that have a tangential relationship to the present case’ (citation omitted). The defendant’s appointment of Kraft as his agent and Kraft’s alleged actions in New York do not form the basis of this action. The plaintiffs’ claim based on the defendant’s failure to pay the note is completely independent of Kraft’s activities pursuant to the terms of the Subscription Agreement.”).

Chen v. Guo Liang Lu, 144 A.D.3d 735, 41 N.Y.S.3d 517 (2d Dep’t 2016) (“Here, the sole purposeful activity cited by the plaintiffs in support of their argument that the defendant is subject to personal jurisdiction pursuant to CPLR 302(a)(1) is the employment relationship between Crystal Window and the defendant. However, the alleged wrongdoing upon which the complaint primarily is based occurred during the defendant’s employment with Huai’an Crystal, a Chinese company, prior to any employment with Crystal Window. Further, although the plaintiffs allege that the defendant visited New York on several occasions in 2009 prior to any employment with Crystal Window, there is no indication that any business was transacted during those visits or that the visits were related in any way to the allegations of wrongdoing contained in the complaint. Therefore, the plaintiffs failed to make a prima facie showing that the defendant is subject to personal jurisdiction pursuant to CPLR 302(a)(1) by virtue of an employment relationship between the defendant and Crystal Window (citations omitted).”).

Hopstein v. Cohen, 143 A.D.3d 859, 40 N.Y.S.3d 436 (2d Dep’t 2016) (“The fact that the appellant may have owned property in New York at some time does not establish jurisdiction under CPLR 302 where, as here, the plaintiffs’ negligence cause of action against the defendant did not arise out of such ownership of property, but rather, the operation of his vehicle in New Jersey (citations omitted).”).

Fernandez v. DaimlerChrysler, A.G., 143 A.D.3d 765, 40 N.Y.S.3d 128 (2d Dep’t 2016) (“Here, the plaintiff failed to establish, prima facie, that Daimler conducted purposeful activities in New York which bore a ‘substantial relationship’ or an ‘articulable nexus’ to the subject matter of this action (citations omitted). Daimler did not manufacture the subject vehicle or the allegedly defective parts of the subject vehicle, or sell the subject vehicle to the decedent. Additionally, the plaintiff failed to establish that any activities conducted by Daimler in New York had an ‘articulable nexus’ or a ‘substantial relationship’ to any of the recalls that were issued on the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. allegedly defective parts of the subject vehicle. Since the plaintiff failed to demonstrate, prima facie, that the causes of action asserted in the complaint arose from any of Daimler’s activities in New York, the Supreme Court was not authorized to exercise personal jurisdiction over Daimler pursuant to CPLR 302(a)(1).”).

CPLR 302 - Purposeful availment

Bloomgarden v. Lanza, 143 A.D.3d 850, 40 N.Y.S.3d 142 (2d Dep’t 2016) (“Here, the plaintiffs failed to show that the defendants actively projected themselves into New York to engage in a sustained and substantial transaction of business within New York, thereby purposefully availing themselves of the privilege of conducting activities in New York so as to subject them to long-arm jurisdiction pursuant to CPLR 302(a)(1) (citation omitted). The defendants communicated from California with the plaintiffs in New York via mail, telephone, and email because the plaintiffs were New York domiciliaries, not because the defendants were actively participating in transactions in New York, and the communications with the plaintiffs in New York all concerned the services that the defendants were performing in Florida (citations omitted).”).

CPLR 302 - Does foreign bank’s use of NY correspondent bank account confer personal jurisdiction?

David L. Ferstendig, Court of Appeals Splits on Whether Foreign Bank’s Use of New York Correspondent Bank Account Confers Personal Jurisdiction, 674 N.Y.S.L.D. 2 (2017).

The maintenance or use of a bank account in New York as a jurisdictional predicate with respect to a foreign defendant has been an issue that courts have grappled with over the years. For example, in Banco Ambrosiano v. Artoc Bank & Trust, 62 N.Y.2d 65 (1984), the Court sustained quasi-in rem jurisdiction, where the bank account was closely related to the claim and was the same account through which the defendant effectuated the transaction at issue.

On the other end of the jurisdictional spectrum was the First Department’s decision in Georgia- Pacific Corp. v. Multimark’s Int’l, 265 A.D.2d 109 (1st Dep’t 2000), where the court held that a defendant’s use of a New York bank account to conduct virtually all of its worldwide business was sufficient to confer general jurisdiction over the defendant. It is doubtful, however, that the Georgia-Pacific holding survives the United States Supreme Court’s decision in Daimler AG v. Bauman, 134 S. Ct. 746 (2014), which significantly narrowed the “doing business” basis for general jurisdiction. See What Remains of Doing Business and Consent as Jurisdictional Bases, 661 N.Y. St. Law Digest 4 (2015).

Most recently, in Al Rushaid v. Pictet & Cie, 2016 N.Y. Slip Op. 07834 (Nov. 22, 2016), the Court of Appeals was concerned with whether a foreign country bank’s use of a New York correspondent bank account conferred specific jurisdiction under CPLR 302, which requires a connection between the cause of the action and the jurisdictional predicate. In Al Rushaid, plaintiffs, two Saudi Arabian companies and a Saudi individual, owner and co-owner of the respective companies, sued a private Switzerland-based bank among others, alleging that they concealed ill-gotten money arising out of a scheme arranged by three of the plaintiffs’ employees. The defendants moved to

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. dismiss the amended complaint for lack of jurisdiction and failure to state a cause of action, among other relief. The trial court granted the motion, concluding that the defendants’ use of correspondent bank accounts in New York was passive, not purposeful. The Appellate Division affirmed, distinguishing this case from a prior Court of Appeals decision in Licci v. Lebanese Can. Bank, SAL, 20 N.Y.3d 327 (2012). The Appellate Division noted that Licci required “deliberate acts” absent in this case because the “defendants merely carried out their clients’ instructions and have not been shown to have ‘purposefully availed [themselves] of the privilege of conducting activities in New York’.” 127 A.D.3d 610, 611 (1st Dep’t 2015).

A majority of the Court of Appeals reversed, finding that defendants’ “repeated” use of correspondent bank accounts to receive and transfer illicit funds was purposeful and “central” to the bribery and kickback scheme. In addition, the Court held that plaintiffs’ aiding and abetting and conspiracy claims arose out of these bank transactions. The Court distinguished between a circumstance where there is a repeated deliberate use of the correspondent account that is approved by the foreign bank and unintended and unapproved use where the foreign bank “is a passive and unilateral recipient of funds later rejected.”

The dissent, written by Judge Pigott, expressed the belief that the majority was ignoring prior precedent, risking “upending over forty years of precedent that holds the mere maintenance of a New York correspondent account is insufficient to assert personal jurisdiction over a foreign bank.” Al Rushaid, 28 N.Y.3d at 339. It stressed that the Licci decision required something more than mere maintenance of and receipt of funds in a correspondent bank and that purposeful contact is necessary -

[T]he foreign bank in Indosuez International Finance B.V. v National Reserve Bank (98 NY2d 238 [2002]) was subject to personal jurisdiction where the bank itself entered into numerous contracts with the plaintiff and specified that payments under those contracts were to be made into the bank’s New York account, for the benefit of the bank. Unlike the foreign bank in Amigo Foods, whose only contact with New York was the maintenance of a correspondent account into which other parties unilaterally chose to deposit funds, the foreign bank in Indosuez was itself a party to the contract that had required payments to be made into its correspondent account. The bank had also expressly designated New York as the place of performance and submitted to New York jurisdiction in six of its agreements (citations omitted).

Id. at *16.

The dissent concluded that here, the defendants had no contacts with New York other than maintaining a correspondent account into which the illicit funds were deposited at the direction of foreign nationals -

Like the foreign bank in Amigo Foods, Pictet has not wired money through its New York correspondent account, nor has it initiated any other contact with the forum state such as the kind we found dispositive in Licci and Indosuez. Even accepting

as true all of the facts alleged in the amended complaint, Pictet was nothing more than an “adventitious” recipient of money that had been transferred into its account at the unilateral direction of foreign nationals, which is insufficient under section 302(a)(1) to exercise personal jurisdiction over a foreign bank.

Id.

CPLR 302(a) - Plaintiff cites no authority to support its argument that New York courts may exercise jurisdiction over defendant because the policy insured the life of a New York resident

AMT Capital Holdings, S.A. v. Sun Life Assur. Co. of Can., 161 A.D.3d 465 (1st Dep’t 2018) (“Defendant issued a $10 million life insurance policy to a trust, designated on the policy application as the policy owner and beneficiary, which the record shows has its situs in New Jersey. The policy application was signed in New Jersey, and the receipt reflecting delivery of the policy identifies New Jersey as the place of execution. While the trustee may be a New York resident, he is neither the designated owner nor a beneficiary of the policy. Plaintiff cites no authority to support its argument that New York courts may exercise jurisdiction over defendant because the policy insured the life of a New York resident. Nor do defendant’s purported ties to New York suffice. Plaintiff points out that the medical portion of the application was signed in New York by the insured and the medical examiner and that, before it was delivered to the trustee, the policy passed through two New York intermediaries. These transactions are not only too fleeting to provide a jurisdictional foundation, but are also not the acts from which plaintiff’s claims arise (citations omitted). Even assuming, as the record suggests, that defendant assured plaintiff (which acquired ownership of the policy) of the incontestability of the policy by a letter faxed to a New York number, this is not sufficient to establish New York jurisdiction over defendant (citation omitted).”).

CPLR 302(a) - Defendants subject to jurisdiction because they were part of a conspiracy that involved the commission of tortious acts in New York

Wimbledon Fin. Master Fund, Ltd. v. Weston Capital Mgt. LLC, 160 A.D.3d 596 (1st Dep’t 2018) (“The Supreme Court properly concluded that defendants are subject to jurisdiction under New York's long-arm statute because they were part of a conspiracy that involved the commission of tortious acts in New York (citations omitted). Defendants were directors on Gerova's board during most of the time when Gerova was involved in a fraudulent scheme. The amended complaint details the conspiracy to commit fraud using Gerova, the agreements between Gerova and Weston board members and insiders, among others, to loot Wimbledon, and Wimbledon's resulting insolvency (citation omitted). Although defendants did not reside or do business in New York, other Gerova defendants were in New York or interacted regularly with New York, including one of the masterminds of the fraudulent scheme, John Galanis. Regarding their overt acts in furtherance of the conspiracy, defendants' approval of a Gerova proxy statement on which they are listed and which seeks approval of the sham acquisition of a reinsurance company, their receipt of ‘hush money’ to ignore certain red flags at Gerova, and their failure to correct misrepresentations or disclose material information to the public sufficed at this stage. Although defendants did not

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. mastermind the conspiracy, their receipt of ‘hush money’ allows the reasonable inference that they exerted ‘control’ to the extent that the fraud could not have been accomplished without their acquiescence to the proxy and other misconduct (citation omitted).”).

CPLR 302(a)(1) - Defendants did not conduct sufficient purposeful activities in New York, which bore a substantial relationship to the subject matter of the action

Santiago v. Highway Frgt. Carriers, Inc., 153 A.D.3d 750, 59 N.Y.S.3d 776 (2d Dep’t 2017) (Motor vehicle accident in Virginia, plaintiffs Nassau County residents, defendants residents of NJ and Pennsylvania. “The defendants did not conduct sufficient purposeful activities in New York, which bore a substantial relationship to the subject matter of this action, so as to avail themselves of the benefits and protections of New York’s laws (citations omitted).”).

CPLR 302(a)(1) - Use of correspondent account in New York

PD Cargo, CA v. Paten Intl. SA, 149 A.D.3d 511, 52 N.Y.S.3d 328 (1st Dep’t 2017) (“Plaintiff’s allegations that Paten used a correspondent account in New York to run a ‘blue dollar’ currency exchange operation, and that defendant vendor Lacteos CDS directed plaintiff’s funds to Paten’s account because Lacteos CDS is a customer of the blue dollar operation, made out a sufficient start in demonstrating personal jurisdiction under CPLR 302(a)(1). Accordingly, plaintiff is entitled to jurisdictional discovery (see citations omitted).”).

CPLR 302(a)(1) - Use of New York escrow account

Nick v. Schneider, 150 A.D.3d 1250, 56 N.Y.S.3d 210 (2d Dep’t 2017) (“Contrary to the defendant’s contention, his alleged contacts with New York amounted to more than mere communications (citation omitted). The defendant allegedly utilized Sommer & Schneider’s New York escrow account to further the alleged fraudulent investment scheme by directing the plaintiffs to deposit the funds for investment deals into the escrow account, by acting as the agent for the purported investment deals, and by using and allowing Joel to use the investment money deposited in the escrow account for personal expenses (citation omitted). As to the second prong of the CPLR 302(a)(1) analysis, the plaintiffs’ allegations demonstrated prima facie that the defendant’s activities in New York had an articulable nexus or substantial relationship to the plaintiffs’ claims (citation omitted). The plaintiffs’ claims against the defendant of fraud, conversion, breach of fiduciary duty, and unjust enrichment turned entirely on the defendant’s use of the New York escrow account to facilitate his fraudulent investment scheme (citation omitted). The plaintiffs also made a prima facie showing that the defendant committed tortious acts within New York, as the defendant is alleged to have converted funds held in New York (citations omitted).”).

CPLR 302(a)(1) - Negotiating terms of a note in NY constitutes transaction of business

Kleinfeld v. Rand, 143 A.D.3d 524, 38 N.Y.S.3d 800 (1st Dep’t 2016) (“Dismissal of the complaint for lack of personal jurisdiction was improper in this action on defendant’s guaranty of a promissory note. Defendant is a New Jersey resident, but he came to New York two or three times — once or twice to negotiate the terms of the note, and once to negotiate his guaranty. Negotiating the terms of a note constitutes the transaction of business (citations omitted), and by analogy, so does negotiating the terms of a guaranty of a note.”).

CPLR 302(a)(1) - Transaction of business

Sager v. City of Buffalo, 151 A.D.3d 1908, 58 N.Y.S.3d 796 (4th Dep’t 2017) (“We conclude that Supreme Court properly determined that plaintiff made a prima facie showing of personal jurisdiction pursuant to CPLR 302 (a) (1) (citation omitted). Habib is the named principal on the liquor license and, in opposition to the motion, plaintiff provided the transcript of the testimony of a witness at the criminal trial of NHJB’s employee in connection with decedent’s death, who stated that Habib was regularly at Molly’s Pub and was present at Molly’s Pub on the night decedent was injured, although not at the time the injuries were inflicted. Thus, upon consideration of the totality of the circumstances, we conclude that Habib ‘has engaged in sufficient purposeful activity to confer jurisdiction in New York’ ‘(citations omitted). We further conclude that Habib’s ‘conduct in relation to New York was such that [he] should [have] reasonably anticipate[d] being haled into court’ ‘in this state, and thus the exercise of jurisdiction does not violate due process (citations omitted”).

CPLR 302(a)(1) - No transaction of business

Ripplewood Advisors, LLC v. Callidus Capital SIA, 151 A.D.3d 611, 54 N.Y.S.3d 291 (1st Dep’t 2017) (“New York does not have personal jurisdiction over defendants pursuant to CPLR 302(a)(1), as they did not avail themselves ‘of the privilege of conducting activities within [this] State, thus invoking the benefits and protections of its laws’ (citation omitted). The telephone and email communications between the Latvian defendants and plaintiff’s office in New York, concerning a contemplated association in the acquisition of a Latvian bank (with no presence in New York) undergoing privatization, do not suffice to constitute the transaction of business in New York. In so concluding, we find it persuasive that defendants never entered New York in connection with their dealings with plaintiff, that the parties’ electronic communications also ran between defendants and plaintiff’s London office, that plaintiff traveled to Latvia in connection with this matter, and that the parties’ contemplated association (if the bank were acquired) would be centered in Latvia (citation omitted]).”).

CPLR 302(a)(1) - Escrow agreement

First Manhattan Energy Corp. v. Meyer, 150 A.D.3d 521, 56 N.Y.S.3d 28 (1st Dep’t 2017) (“Plaintiff alleges that defendant Meyer failed to release funds that plaintiff deposited into Meyer’s lawyer trust account to be held in escrow. Plaintiff had entered into the escrow agreement with a New York law firm, which had designated defendant, a California attorney, as its agent, pursuant to an agreement with defendant. Defendant moved to dismiss on the ground, inter alia, of lack of jurisdiction over him, arguing that he was a California lawyer with no presence in New York, was

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. not party to the escrow agreement, and did not transact business in New York. Plaintiff made a sufficient showing of jurisdiction pursuant to CPLR 302(a)(1) to withstand dismissal (citation omitted). The record establishes prima facie that defendant, while not a party to the instant escrow agreement, was designated in the escrow agreement as the ‘Assigned Escrow Agent[]’ into whose account the funds would be deposited, and that he accepted the funds pursuant to the agreement. In so doing, pursuant to his agreement with the New York escrowee, defendant ‘affected local commerce’ in New York by ‘chang[ing] [plaintiff’s] economic position,’ and in receiving the funds into his California account via wire transfer, he transacted business here by availing himself of modern technology to participate in and confer upon himself the benefit of the transaction while living and physically working elsewhere (citation omitted).”).

CPLR 302(a)(1) - Transaction of business – distinguishes Fischbarg case

Coast to Coast Energy, Inc. v. Gasarch, 149 A.D.3d 485, 53 N.Y.S.3d 16, Footnote 1 (1st Dep’t 2017) (“As the dissent observes, the Court of Appeals concluded in Fischbarg that defendants’ retention and subsequent communications with plaintiff in New York established a continuing attorney-client relationship in this state and thereby constituted the transaction of business under CPLR 302(a)(1). However, in Fischbarg the record established that defendants called Fischbarg, a New York attorney, in order to represent them in an action in Oregon, entered into a retainer agreement, and participated in that relationship via telephone calls, faxes and e-mails over many months. Thus, the Court found that defendants purposefully projected themselves into New York. In contrast, here plaintiffs rely on conclusory allegations and have not demonstrated that Wampler engaged in sustained and substantial business with plaintiffs in New York.”).

CPLR 302(a)(1) - Website

Venegas v. Capric Clinic, 147 A.D.3d 457, 47 N.Y.S.3d 13 (1st Dep’t 2017) (“In opposition to the doctor’s showing of the lack of personal jurisdiction over him (citation omitted), plaintiff made a ‘sufficient start’ to warrant discovery concerning whether the doctor has jurisdictional contacts with the State of New York sufficient to support the exercise of jurisdiction under CPLR 302(a)(1) (citations omitted). Although the website information submitted by plaintiff is, by itself, insufficient to meet his ultimate burden of establishing jurisdiction (citations omitted), the statements on the website boasting that the doctor has provided medical treatment in New York for the last 14 years directly contradict the doctor’s claims that he has never provided any medical treatment in New York. Because the doctor averred that he only treated plaintiff in Pennsylvania, and plaintiff submitted no evidence disputing that sworn statement, any injury suffered by plaintiff occurred in Pennsylvania, where the malpractice took place (citations omitted). Therefore, to the extent plaintiff alternatively relies on CPLR 302(a)(3)(i), he failed to make a sufficient start in showing jurisdiction under that provision (id.).”).

COMMENCEMENT

CPLR 304 - Commencing actions or special proceedings

CPLR 304 - Failure to file initial papers, here in a third-party action, is nonwaivable jurisdictional defect

DiSilvio v. Romanelli, 150 A.D. 3d 1078, 56 N.Y.S.3d 162 (2d Dep’t 2017) (“Under CPLR 304(a), an action in Supreme Court is ordinarily commenced ‘by filing a summons and complaint or summons with notice.’ The failure to file the initial papers necessary to commence an action constitutes a nonwaivable, jurisdictional defect, rendering the action a nullity (citations omitted). Here, the appellant undertook no steps to commence a third-party action, despite his unilateral amendment of the caption of the action in his motion papers to include the nonparty respondents as ‘third-party defendants.’ Consequently, the jurisdiction of the court was never invoked and the purported third-party action was a nullity (citation omitted). As a result, all relief sought by the appellant against the nonparty-respondents was properly denied.”).

CPLR 304 / 2001 - Filing with the wrong clerk renders the proceeding a nullity

CPLR 304 / 2001 - Failure to file papers required to commence a proceeding constitutes a nonwaivable, jurisdictional defect

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. in proper form until after the four-month statutory period had expired, Supreme Court properly dismissed the petition as untimely (citations omitted). Contrary to petitioner's contention, the deficiencies in the initial papers submitted — which included unsigned, undated and non-original documents — are not subject to correction pursuant to CPLR 2001 so as to render the proceeding timely inasmuch as ‘[t]he failure to file the papers required to commence [a proceeding] constitutes a nonwaivable, jurisdictional defect’ (citations omitted). Accordingly, the merits of the disciplinary determination are not properly before us.”).

SUMMONS

CPLR 305 - Summons

CPLR 305(c) - There was no misnomer that required correction by amendment

Martin v. Witkowski, 2017 NY Slip Op 09014 (4th Dep’t 2017) (“This appeal raises an age-old dilemma: how should the law distinguish between a father and son of the same name? Under the circumstances presented here, we hold that plaintiff properly commenced a single action against Walter Witkowski, Jr. notwithstanding plaintiff’s initial and ineffective attempt to serve Witkowski, Jr. at the home of his father, Walter Witkowski, Sr. … In light of the foregoing, we hold that Junior is, and always has been, the only defendant in this case. We emphasize, however, that our conclusion is based in no part on the rule of Stuyvesant v. Weil (citation omitted), which ‘has been consistently interpreted as allowing a misnomer in the description of a party defendant to be cured by amendment [so long as] (1) there is evidence that the correct defendant (misnamed in the original process) has in fact been properly served, and (2) the correct defendant would not be prejudiced by granting the amendment’ (citations omitted). The Stuyvesant rule, which has been codified and subsumed within CPLR 305 (c), applies when there has been a ‘misnomer’ in describing the defendant in the summons and/or complaint, and that simply did not occur here. Junior was not ‘misnamed’ as defendant ‘Walter Witkowski.’ To the contrary, although this description is perhaps an imprecise recitation of the defendant’s name, it is not in any sense an inaccurate recitation of Junior’s name. Whatever else he might choose to be called, Junior is unquestionably a ‘Walter Witkowski.’ And as then Chief Justice Kent observed over two centuries ago, the suffix ‘junior is no part of the name . . . It is a casual and temporary designation. It may exist one day, and cease the next’ (citation omitted). The Stuyvesant rule therefore has no application here; put simply, there was no ‘misnomer’ that required correction by amendment.”).

CPLR 305(c) - Amendment of caption of summons would prejudice City since it was not served with a timely notice of claim

West v. City of New York, 143 A.D.3d 810, 39 N.Y.S.3d 65 (2d Dep’t 2016) (“The plaintiff concedes that neither the City nor the Dormitory Authority is a proper party to this action. He seeks to amend the caption to substitute CUNY as the defendant and to deem the summons and complaint served upon CUNY, nunc pro tunc, pursuant to CPLR 305(c). . . . Here, CUNY would be prejudiced by the amendment because the plaintiff failed to timely serve it with a notice of claim, which is a condition precedent to the commencement of a tort action against a community college

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. of CUNY (citations omitted). While the plaintiff’s initial service of a notice of claim naming the wrong municipal entity might have constituted a reasonable excuse to support a motion for leave to serve a late notice of claim made within the available one-year-and-90-day statute of limitations (see General Municipal Law § 50-e[5]), the plaintiff never made such a timely motion. To the extent that the plaintiff’s cross motion can be deemed an application to serve a late notice of claim against CUNY, as the one-year-and-90-day statute of limitations has expired, the Supreme Court lacked the authority to extend the time to file a notice of claim beyond the statutory time limit for the asserted claim (citations omitted).”).

CPLR 305(c) - Misnomer exception does not apply because proper party was not served

Gil v. City of New York, 143 A.D.3d 572, 41 N.Y.S.3d 13 (1st Dep’t 2016) (“It is undisputed that Reyes and Jean filed a complaint naming only New York City Department of Parks and Recreation (Parks), which it served only on Parks. Movants contend that they should be permitted to amend the summons and complaint to add the City as a defendant because Parks was a misnomer. However, the misnomer exception is inapplicable because the proper party, the City, was not served (citations omitted). Moreover, CPLR 306-b may not be used to extend the statute of limitations (citation omitted). The relation back doctrine is similarly inapplicable because a mistake of law is not the type of mistake contemplated by the doctrine (citations omitted). Here, movants mistakenly believed that Parks was an entity subject to suit (see NY City Charter § 396).”).

CPLR 305(c) - Amendment of caption to correct name of party/entity

Jaramillo v. Asconcio, 151 A.D.3d 947, 58 N.Y.S.3d 412 (2d Dep’t 2017) (“[T]he supplemental summons and amended complaint did not add Darek Cake, Inc., as a new party. Rather, that defendant was one of the original parties, sued under the misnomer ‘Darek Cake Company.’ The amendment of a caption to correct the name of an entity which is already a party to the action is governed by CPLR 305(c), which provides that the court may permit such an amendment ‘[a]t any time, in its discretion and upon such terms as it deems just, . . . if a substantial right of a party against whom the summons issued is not prejudiced’ (citations omitted). The amendment may be made nunc pro tunc (citation omitted). Here, the so-ordered stipulation, signed and filed in January 2014, was sufficient to correct the caption, and there is no evidence of prejudice. However, Marzena Lojek was not an original party to the action, nor is there any evidence that she waived the issue of personal jurisdiction. Therefore, the Supreme Court should have granted that branch of the motion which was to dismiss the amended complaint insofar as asserted against her as barred by the statute of limitations.”).

SERVICE

CPLR 306-b - Service of initiating pleadings

CPLR 306-b - Plaintiff’s motion for extension under CPLR 306-b permitted after motion to dismiss on jurisdictional grounds was granted because no judgment had been entered

US Bank N.A. v. Saintus, 153 A.D.3d 1380, 61 N.Y.S.3d 315 (2d Dep’t 2017) (“Under the circumstances of this case, the Supreme Court should have granted that branch of the plaintiff’s motion which was pursuant to CPLR 306-b for leave to extend its time to serve the summons and complaint upon Saintus in the interest of justice (citation omitted). While the action was timely commenced, the statute of limitations had expired when the plaintiff moved for this relief, the timely service of process was subsequently found to have been defective, there was no identifiable prejudice to Saintus attributable to the delay in proper service, and the complaint appears to be potentially meritorious (citations omitted). Contrary to Saintus’s contention, the court did not lack jurisdiction to entertain this branch of the plaintiff’s motion. Inasmuch as no judgment was entered dismissing the action, the action was pending when the plaintiff moved to extend the time to serve Saintus with process (citation omitted).”).

CPLR 306-b - Extension granted

Furze v. Stapen, 161 A.D.3d 827 (2d Dep’t 2018) (‘Here, the record established that the plaintiff exercised diligence in timely filing, and in attempting to serve Nayak and notify Nayak and her insurance carrier of the summons and complaint within the 120-day period following the filing of the summons and complaint, although the attempt to serve Nayak was ultimately deemed defective (citation omitted). While the action was timely commenced, the statute of limitations had expired when the plaintiff cross-moved for relief, the plaintiff promptly cross-moved for an extension of time to serve Nayak, and there was no identifiable prejudice to Nayak attributable to the delay in service (citations omitted).”).

Nunez-Ariza v. Nell, 161 A.D.3d 614 (1st Dep’t 2018) (“Here, defendant’s insurer was on notice of the claim within months of the happening of the accident and plaintiff demonstrated a potentially meritorious action. ‘Because some factors weigh in favor of granting an interest of justice extension and some do not, we should not disturb Supreme Court’s discretion-laden determination’ (citations omitted).”).

CPLR 306-b - Extension granted in interest of justice

Estate of Fernandez v. Wyckoff Hgts. Med. Ctr., 2018 NY Slip Op 04306 (2d Dep’t 2018) (“Contrary to the plaintiff's contention, an attempt at service that later proves defective cannot be the basis for a ‘good cause’ extension of time to serve process pursuant to CPLR 306-b (citations omitted). However, the more flexible ‘interest of justice’ standard accommodates late service that might be due to mistake, confusion, or oversight, so long as there is no prejudice to the defendant (citation omitted). Indeed, the court may consider diligence or lack thereof, along with any other relevant factor, in making its determination, including expiration of the statute of limitations, the potentially meritorious nature of the cause of action, the length of delay in service, the promptness of a plaintiff's request for the extension of time, and prejudice to defendant (citations omitted). Here, several factors weighed in favor of granting the plaintiff's cross motion. The action was timely commenced, and the statute of limitations with respect to one of the two causes of action had expired when the plaintiff cross-moved for relief (citations omitted). The appellant also had actual notice of this action within 120 days after its commencement (citations omitted).

Furthermore, an extension of time to serve the summons and complaint under CPLR 306-b in the interest of justice is available where, as here, ‘service is timely made within the 120-day period but is subsequently found to have been defective’ (citations omitted). Finally, we note that whether a plaintiff has demonstrated that he or she has a potentially meritorious cause of action is but one factor to be considered by a court in determining a CPLR 306-b motion (citation omitted).”).

Gabbar v. Flatlands Commons, LLC, 150 A.D.3d 1084, 55 N.Y.S.3d 353 (2d Dep’t 2017) (“The Supreme Court providently exercised its discretion in granting the plaintiffs’ cross motion pursuant to CPLR 306-b to extend their time to serve the summons and complaint upon the appellant in the interest of justice (citation omitted). The plaintiffs’ time to effect service of process was properly extended since the verified complaint demonstrated a potentially meritorious cause of action, the statute of limitations had expired, the action was commenced within the 3-year statutory period, service of the summons and complaint which was timely made within the 120-day period (citation omitted) was subsequently found to have been defective, and there is no demonstrable prejudice to the appellant that would militate against granting the extension of time to serve it (citations omitted). In the absence of prejudice to the appellant, it would be unjust to deprive the plaintiffs of the opportunity to prove their causes of action against both defendants (citations omitted).”).

CPLR 306-b - Extreme lack of diligence

Hourie v. North Shore-Long Is. Jewish Health Sys., Inc.-Lenox Hill Hosp., 150 A.D.3d 707, 54 N.Y.S.3d 53 (2d Dep’t 2017) (“Here, the plaintiff failed to demonstrate that she was entitled to an extension of time to serve the appellant for good cause, as she failed to establish that she exercised reasonably diligent efforts in attempting to effect proper service (citation omitted). Not only did the plaintiff fail to make any further attempts to serve the appellant after her first attempt was unsuccessful, as the summons was returned to her, but her complaint insofar as asserted against the other defendants was dismissed because she failed to timely serve them with a complaint. Further, the plaintiff failed to establish her entitlement to an extension of time for service in the interest of justice, as she exhibited an extreme lack of diligence in attempting to effect proper service, waited almost five months after the expiration of the 120-day period in which she was required to serve the appellant to move for the extension of time, and failed to demonstrate a potentially meritorious cause of action (citations omitted).”).

Krasa v. Dial 7 Car & Limousine Serv., Inc., 147 A.D.3d 744, 46 N.Y.S.3d 196 (2d Dep’t 2017) (“The plaintiff failed to show good cause for her failure to serve the defendants, since she admittedly made no attempt to serve them within 120 days after the filing of the summons and complaint (citations omitted). Furthermore, the plaintiff failed to establish that an extension of time was warranted in the interest of justice. The plaintiff exhibited an extreme lack of diligence in commencing the action, which was not commenced until one day before the expiration of the statute of limitations, made a single attempt to effect service two months after the expiration of the 120-day period set forth in CPLR 306-b, failed to seek an extension of time until after the defendants moved to dismiss the complaint for lack of personal jurisdiction, failed to offer any excuse for the delay in serving the defendants, and failed to demonstrate a potentially meritorious cause of action (citations omitted).”).

CPLR 306-b - Waiting for 18 months after service was contested to move for extensions, deemed not unreasonable under circumstances

Deutsche Bank, AG v. Vik, 149 A.D.3d 600, 50 N.Y.S.3d 291 (1st Dep’t 2017) (“The motion court exercised its discretion in a provident manner in granting the extension both for ‘good cause shown’ and ‘in the interest of justice’ (citation omitted). Although plaintiff waited to move for the extension until 18 months after service was contested, this was not unreasonable under the circumstances presented. Furthermore, other relevant factors weighed in favor of granting the motion including plaintiff’s diligence, the expiration of the statute of limitations on a number of the plaintiff’s claims and the absence of prejudice to defendant in light of his actual notice of the summons and complaint (citation omitted). Where ‘some factors weigh in favor of granting an interest of justice extension and some do not,’ ‘this Court will not disturb the motion court’s “discretion-laden determination”‘ (citations omitted)”).

CPLR 306-b - Failure to demonstrate good cause or entitlement to extension in interests of justice

Encarnacion v. Ogunro, 2018 NY Slip Op 04698 (2d Dep’t 2018) (“The plaintiff failed to demonstrate good cause. The attempt to serve the defendant pursuant to CPLR 308(4) was ineffective as a matter of law because the place where process was affixed was not the defendant's ‘actual place of business, dwelling place or usual place of abode’ (citations omitted). The plaintiff also failed to establish her entitlement to an extension of time for service of the summons and complaint in the interest of justice in view of the extreme lack of diligence in attempting to effect service, the more than six-year delay between the filing of the summons and complaint and the time the cross motion was made, the plaintiff's failure to move for an extension of time until more than eight months after the defendant moved to vacate the default judgment, the four-year delay between the expiration of the statute of limitations and the defendant's receipt of notice of this action, and the inference of substantial prejudice due to the lack of notice of the plaintiff's causes of action until more than six years after their accrual (citations omitted).”).

Zerbi v. Botwinick, 2018 NY Slip Op 04376 (2d Dep’t 2018) (“The plaintiffs failed to establish that they exercised reasonably diligent efforts in attempting to effect proper service on Botwinick and, therefore, failed to demonstrate good cause (citations omitted). The plaintiffs also failed to establish that an extension of time was warranted in the interest of justice. The plaintiffs exhibited a lack of diligence in attempting to effect proper service, failed to seek an extension of time until after the defendants' motion was made, did not rebut the evidence that Botwinick did not learn of the action until eight months after the statute of limitations had run, and failed to demonstrate a potentially meritorious cause of action (citations omitted). Accordingly, we agree with the Supreme Court's determination to deny the plaintiffs' cross motion and to grant that branch of the defendants' motion which was to dismiss the complaint insofar as asserted against Botwinick.”).

Silvering v. Sunrise Family Med., P.C., 161 A.D.3d 1021 (2d Dep’t 2018) (“Having failed to investigate whether the defendant still worked at Sunrise, the plaintiffs failed to demonstrate that they exercised reasonable diligence in attempting to effect service. Thus, the plaintiffs were not entitled to an extension of time for ‘good cause’ (citations omitted). Nor did the plaintiffs

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. demonstrate circumstances warranting an extension of time ‘in the interest of justice’ (citation omitted). The plaintiffs did not exercise diligence in serving the defendant, the defendant had no notice of the action until over two years after expiration of the statute of limitations, and there was no showing of merit to the plaintiffs’ causes of action (citation omitted).”).

CPLR 306-b - Extension unavailable; claims already time-barred and lacked merit

Schwartz v. Chan, 75 N.Y.S.3d 31 (1st Dep’t 2018) (“As plaintiff's claims were already time- barred under the statute of limitations for libel and slander actions (citation omitted) when he filed the summons, CPLR 306–b is unavailable to him to extend his time to serve the complaint (citations omitted). Nor is an extension warranted in the interest of justice, since the claims not only are time-barred but also lack merit (citations omitted). The statements of which plaintiff complains are protected by the litigation privilege, since they were prepared in connection with a threatened litigation, at the direction of a potential defendant, by an individual who, at a minimum, was a potential witness (citation omitted).”).

CPLR 306-b - Extension denied; factors considered

Holbeck v. Sosa-Berrios, 161 A.D.3d 957 (2d Dep’t 2018) (“Here, the plaintiff failed to demonstrate ‘good cause’ for an extension of time, as he did not show that he exercised reasonable diligence in attempting to effect service (citations omitted). The plaintiff resorted to affix and mail service after only two attempts to deliver the summons and complaint on a weekday, at approximately the same time of day, when the defendant reasonably could have been expected to be at work (citations omitted). Further, the affirmation of the plaintiff’s counsel does not indicate that he made any effort to verify that the defendant still resided at the address listed on the three- year-old police report, particularly after efforts to deliver the summons and complaint were unsuccessful (citations omitted). In addition, the Supreme Court did not improvidently exercise its discretion in declining to grant the plaintiff an extension of time in the interest of justice. … Here, as a result of the plaintiff’s lack of diligence in serving the defendant, the defendant did not receive the summons and complaint until approximately 3 months and 3 weeks after expiration of the 120- day period for service, and approximately 7½ months after expiration of the statute of limitations. Significantly, there is no evidence that the defendant had any notice of the action until that time. Further, the plaintiff did not adduce evidence tending to show a lack of prejudice to the defendant, and there was no showing of merit to the plaintiff’s claim of having sustained a serious injury, including even a recitation of the injuries he suffered.”).

CPLR 306-b - Plaintiff’s bare assertion that his pro se and incarcerated status constitutes good cause to extend his time to effectuate service rejected

Stegemann v. Rensselaer County Sheriff’s Off., 155 A.D.3d 1455 (3d Dep’t 2017) (“First, Supreme Court correctly rejected plaintiff’s bare assertion that his pro se and incarcerated status constitutes good cause to extend his time to effectuate service (citations omitted). Plaintiff has made no effort to demonstrate how his imprisonment prevented his compliance with statutory service requirements. Moreover, we note that he has commenced two other very similar civil actions and

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. engaged in extensive motion practice in this case and the other two actions, despite his incarceration and pro se status.”).

CPLR 306-b - Inasmuch as defendant failed to move to dismiss the complaint based on improper service within 60 days of serving his answer, he cannot challenge the court’s determination to grant that part of plaintiff’s cross motion seeking an extension of time for service of the summons and complaint pursuant to CPLR 306-b

Doe v. D’Angelo, 154 A.D.3d 1300, 62 N.Y.S.3d 680 (4th Dep’t 2017) (“We agree with plaintiff that Supreme Court properly denied defendant’s motion inasmuch as defendant waived his defense of lack of personal jurisdiction based on improper service of process by failing to move to dismiss the complaint on that ground within 60 days of serving his answer (citations omitted). Defendant’s contention that his motion was based on the statute of limitations, as opposed to improper service, is belied by the record and, in any event, is without merit because plaintiff filed the summons with notice prior to the expiration of the limitations period (citations omitted). We likewise conclude that, inasmuch as defendant failed to move to dismiss the complaint based on improper service within 60 days of serving his answer, he cannot challenge the court’s determination to grant that part of plaintiff’s cross motion seeking an extension of time for service of the summons and complaint pursuant to CPLR 306-b (citation omitted). In any event, upon consideration of the relevant factors, including the expiration of the statute of limitations, the meritorious nature of plaintiff’s cause of action against defendant, and defendant’s failure to show any prejudice, we conclude that the court did not abuse its discretion in granting that part of plaintiff’s cross motion (citations omitted).”).

CPLR 306-b - Extension denied; lack of reasonable diligence; plaintiff should have known person served was not authorized to receive service, and made no effort to learn the identity of the current officers

Goldstein Group Holding, Inc. v. 310 E. 4th St. Hous. Dev. Fund Corp., 154 A.D.3d 458, 62 N.Y.S.3d 105 (1st Dep’t 2017) (“Plaintiff then requested an extension of time for service in opposition to defendant’s motion to dismiss, instead of formally cross-moving for an extension (citation omitted). We need not reach the disputed procedural issue regarding whether a formal cross motion was required because the court providently exercised its discretion in denying the request for an extension on its merits (citation omitted). By attempting service on Brandstein, who plaintiff should have known was not authorized to receive service, and making no effort to learn the identity of the current officers, plaintiff failed to act with reasonable diligence in trying to effect service, and thus failed to establish good cause in support of its request (citations omitted). Nor is an extension of time to serve warranted in the interest of justice, given plaintiff’s failure to act with any due diligence to ensure that the instant action was not dismissed for exactly the same reason for which the prior action was dismissed. While the statute of limitations on plaintiff’s claim may have expired, defendant’s low-income tenants have lived through two foreclosure actions and beyond the statute of limitations with the uncertainty whether they may remain in their homes, and plaintiff waited until after expiration of the 120-day period to serve defendant or seek an extension of time (citation omitted).”).

CPLR 306-b - Extension should be sought via cross-motion

Komanicky v. Contractor, 146 A.D.3d 1042, 43 N.Y.S.3d 761 (3rd Dep’t 2017) (“To the extent that plaintiff’s papers in opposition to the motions can be read as requesting an extension of time to serve defendants pursuant to CPLR 306-b, such affirmative relief should have been sought by way of a cross motion on notice (citations omitted). … In addition to plaintiff’s lack of diligence in attempting to effectuate service within the time period prescribed by CPLR 306-b (citations omitted), his purported ‘request’ for an extension of time for service, even if it may be deemed as such, was made more than 15 months after the 120-day period had expired and only after defendants had moved for dismissal (citations omitted).”).

CPLR 306-b / CPLR 308(2) - Delivery and mailing must be effected within 120 days

Purzak v. Long Is. Hous. Servs., Inc., 149 A.D.3d 989, 53 N.Y.S.3d 112 (2d Dep’t 2017) (“Both the delivery and mailing components of CPLR 308(2) must be performed within 120 days of the filing of process (citations omitted). Here, the affidavits of the plaintiff’s process server state that he served the summons with notice on DeGennaro, Santantonio, Bonet, and Roman by delivering copies to Wilder at the LIHS office on December 2, 2011, and by mailing additional copies to those defendants at the LIHS office on December 5, 2011. December 5, 2011, is 122 days after the date of the filing of the summons with notice, and beyond the 120-day period required by CPLR 306-b. Consequently, service of the summons with notice upon the individually named defendants was untimely (citation omitted). Moreover, as to service upon DeGennaro, Santantonio, Bonet, and Roman, the plaintiff failed to demonstrate good cause for an extension of time to effect proper service on those defendants, or that an extension was otherwise warranted in the interest of justice (citations omitted).”).

CPLR 308 - Personal service on natural persons

CPLR 308(2) - Service on 15-year-old as person of “suitable age and discretion” within the meaning of CPLR 308(2)

Marathon Structured Asset Solutions Trust v. Fennell, 153 A.D.3d 511, 61 N.Y.S.3d 232 (2d Dep’t 2017) (“The Supreme Court properly denied that branch of the defendants’ motion which was to dismiss the complaint insofar as asserted against them for lack of personal jurisdiction based on improper service. The affidavit of the process server constituted prima facie evidence of proper service pursuant to CPLR 308(2) (citations omitted). In opposition, the affidavits submitted by the defendants were insufficient to rebut the presumption of proper service created by the process server’s affidavit (citation omitted). Although the defendants demonstrated that service was effected on their then 15-year-old daughter, they failed to establish that their daughter was not ‘objectively . . . of sufficient maturity, understanding and responsibility under the circumstances so as to be reasonably likely to convey the summons to [her]’ (citation omitted) and, thus, not a person of ‘suitable age and discretion’ within the meaning of CPLR 308(2).”).

CPLR 308(2) - Hearing to determine whether the security guard was person of suitable age and discretion and if the outer bounds of the defendants’ dwelling place extended to the security office

Citibank, N.A. v. Balsamo, 144 A.D.3d 964, 41 N.Y.S.3d 744 (2d Dep’t 2016) (“The plaintiff’s process server averred that he was denied entry to the defendants’ condominium complex ‘by [the] defendant[s],’ and that he, therefore, left the summons and complaint with ‘JOHN DOE (NAME REFUSED), SECURITY GUARD.’ ‘[I]f a process server is not permitted to proceed to the actual apartment by the doorman or some other employee, the outer bounds of the actual dwelling place must be deemed to extend to the location at which the process server’s progress is arrested’ (citations omitted). However, the defendants rebutted the process server’s affidavit of service through their specific and detailed averments that they never received the summons and complaint, that they never denied access to a delivery person or received a call to authorize a delivery on the date in question or on any other day, and that the security guards are not authorized to receive packages or deliveries (citation omitted). Under these circumstances, the Supreme Court should have conducted a hearing to determine whether the security guard was a person of suitable age and discretion within the contemplation of CPLR 308(2), and if the outer bounds of the defendants’ dwelling place extended to the security office (citations omitted).”).

CPLR 308(2) - Delivery to concierge

Citibank, N.A. v. K.L.P. Sportswear, Inc., 144 A.D.3d 475, 41 N.Y.S.3d 29 (1st Dep’t 2016) (“The process server testified that it was his general practice not to deliver papers to a concierge without first seeking permission to go up to the relevant apartment. The property manager of the building in which defendant resides likewise testified that it was the building’s policy to not allow anyone to enter without the resident’s permission. This testimony regarding general practices was sufficient to raise a presumption of proper service (citations omitted), and defendant failed to rebut this presumption (citation omitted). The process server’s failure to preserve his contemporaneous logbook is not sufficient to rebut the presumption, especially since the property manager’s testimony corroborated the testimony of the process server (citation omitted).”).

CPLR 308(2) - “Outer bounds” of defendant’s dwelling – Service not refused

Wells Fargo Bank, N.A. v. Ferrato, 150 A.D.3d 546, 55 N.Y.S.3d 191 (1st Dep’t 2017) (“Plaintiff’s process server attempted to serve defendant at her apartment, which was a loft accessed directly from an elevator. The process server averred that a woman was standing inside holding a baby and a party was in progress, so he dropped the papers. Denying that service was properly made pursuant to CPLR 308(2), plaintiff submitted the affidavit of a woman who stated that she was at the entrance to the apartment and holding a baby at the time specified by the process server, but that he never identified himself, did not ask her to take the papers, did not attempt to gain access, and did not hand any papers to her or drop papers near her. Instead, the elevator door closed with the process server and the papers still inside. Under this version of the events, service was not properly made pursuant to CPLR 308(2). While plaintiff argued that the ‘outer bounds’ of defendant’s dwelling extended to include the elevator, it did not establish either that its process

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. server was not permitted to proceed or that service was made upon ‘a person of suitable age and discretion’ (citation omitted). Further, since plaintiff did not establish that service was refused upon the process server informing the person at the apartment that service was being made by leaving a copy of the summons outside the door (inside the elevator) of the person to be served, plaintiff did not demonstrate that the process server made the person aware that such service was being made (citation omitted). In light of the factual issues as to the validity of service, the threshold issue of personal service should have been resolved with a traverse hearing (citation omitted).”).

CPLR 308(2) - Service on defendant’s mother while she was inside her own apartment in same multiple dwelling as defendant is insufficient

Thacker v. Malloy, 148 A.D.3d 857, 49 N.Y.S.3d 165 (2d Dep’t 2017) (“Here, at a hearing to determine the validity of service of process, the plaintiff failed to meet her burden of proving by a preponderance of the evidence that jurisdiction over the defendant was obtained by proper service of process. Evidence showed that the process server walked up to the window of the defendant’s mother’s ground-floor apartment to give her the summons and complaint as he stood on the sidewalk and she stood inside her apartment. Although the defendant resided in the same multiple- dwelling building as his mother, his apartment was on a higher floor, and it was separate and distinct from his mother’s apartment. Hence, in serving the defendant’s mother with the summons and complaint while she was inside her own apartment, service was not made at the defendant’s actual dwelling place (citations omitted). Accordingly, the Supreme Court properly, in effect, granted that branch of the defendant’s cross motion which was pursuant to CPLR 3211(a)(8) to dismiss the complaint for lack of personal jurisdiction.”).

CPLR 308(2) - Service proper

Matter of Savitt, 161 A.D.3d 109 (1st Dep’t 2018) (“We find that respondent has failed to rebut the Committee's evidence of proper service. Jurisdiction was properly attained over respondent where the petition of charges was delivered to ‘Connie’ at respondent's actual place of business and then mailed the next day to respondent's office, and any defects in the affidavit of service or the failure to timely file said affidavits with this Court are irregularities that can be properly cured by deeming it filed nunc pro tunc (citations omitted).”).

CPLR 308(2) - Failure to file proof of service

Divito v. Fiandach, 160 A.D.3d 1404 (4th Dep’t 2018) (“Contrary to plaintiff's initial contention, defendant was not in default in the action because plaintiff never effectuated proper service upon him. Plaintiff attempted personal service pursuant to CPLR 308 (2) by delivering a copy of the summons and complaint to a person of suitable age and discretion at defendant's workplace and by mailing a copy to his workplace. Plaintiff did not, however, file proof of service in the Monroe County Clerk's Office within 20 days of the delivery or mailing (citation omitted), and he never applied to the court for leave to file a late proof of service (citation omitted). As a result, plaintiff's subsequent late filing of the proof of service was a nullity (citations omitted). Personal service of the summons was not deemed to have occurred until March 14, 2016, when defendant's attorney

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. filed a notice of appearance (citation omitted). Defendant had 20 days from that date to serve an answer or a motion to dismiss (citation omitted), to avoid being in default (citation omitted). Defendant's motion to dismiss the complaint pursuant to CPLR 3211 was made 18 days later, and thus he never defaulted in the action (citation omitted).”).

CPLR 308(2) / 5015(a)(4)- Mailing requirement not strictly complied with

Deutsche Bank Natl. Trust Co. v. Ferguson, 156 A.D.3d 460, 64 N.Y.S.3d 887 (1st Dep’t 2017) (“Defendant established his entitlement to vacatur of the judgment of foreclosure and sale by showing that he was not properly served with the summons and complaint in this action (CPLR 308[2]) and that therefore the court lacked jurisdiction to render the judgment (CPLR 5015[a][4]). In opposition to plaintiff’s prima facie showing of proper service, defendant raised an issue of fact as to the veracity of the affidavit with respect to personal delivery (citation omitted). While defendant’s showing would otherwise require a traverse hearing (id.), it also demonstrated as a matter of law that the mailing component of CPLR 308(2) was not strictly complied with (citation omitted). The affidavit of service says that the summons and complaint were mailed to defendant’s ‘last known address,’ without identifying that address. The terms of the mortgage require that notices to defendant be sent to the address of the mortgaged property, unless defendant gives plaintiff notice of a different address. There is no evidence in the record that defendant ever gave plaintiff notice of a different address (citation omitted).”).

CPLR 308(2) - Person of SAD does not have to reside in premises

Nationstar Mtge., LLC v. Kamil, 155 A.D.3d 966, 64 N.Y.S.3d 116 (2d Dep’t 2017) (“Here, the process server’s affidavit of service contained sworn allegations reciting that service was made upon the defendant by leaving the relevant papers with a person of suitable age and discretion, namely ‘Sabir Ahmad, male relative,’ at the defendant’s residence, and by subsequently mailing a second copy of the papers to the defendant at the same address (citation omitted). Accordingly, the affidavit of service constituted prima facie evidence of service of the summons and complaint pursuant to CPLR 308(2) (citations omitted). Contrary to the defendant’s contention, his affidavit failed to rebut the presumption of proper service arising from the process server’s affidavit as to service upon him. While the defendant denied knowledge of any person by the name of ‘Sabir Ahmad,’ and asserted that no one by that name ever resided at the premises, he did not rebut the process server’s sworn allegation that a person fitting the physical description of Sabir Ahmad was present at the subject property at the time and accepted service on behalf of the defendant (citations omitted).”).

Wells Fargo Bank, N.A. v. Decesare, 154 A.D.3d 717, 62 N.Y.S.3d 446 (2d Dep’t 2017) (“Here, the affidavit of service contained sworn allegations reciting that service was made upon the defendant Angela Decesare, also known as Angela T. DeCesare (hereinafter the defendant), by leaving the relevant papers with a person of suitable age and discretion, who identified himself as ‘John DeCesare,’ at the defendant’s residence, and by subsequently mailing a second copy of the papers to the defendant at the same address. The affidavit of service included a description of ‘John DeCesare.’ Contrary to the determination of the Supreme Court, the defendant’s submissions failed to rebut the affidavit of service, since they stated that the only person fitting that description

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. who resided at the premises was the defendant’s son Richard, and Richard could not have been present at the time of the alleged service since he was at work. The defendant’s submissions did not rebut the sworn allegation that a person fitting the physical description of ‘John DeCesare’ was present at the residence at the time and accepted service on behalf of the defendant (citations omitted). Indeed, ‘[v]alid service pursuant to CPLR 308 (2) may be made by delivery of the summons and complaint to a person of suitable age and discretion who answers the door at a defendant’s residence, but is not a resident of the subject property’ (citation omitted). Moreover, the defendant did not deny that she received the papers in the mail and thus did not overcome the inference of proper mailing that arose from the affidavit of service (citation omitted). Accordingly, a hearing to determine the validity of service of process was not warranted under the circumstances of this case (citation omitted), and the Supreme Court should have denied that branch of the defendant’s cross motion which was pursuant to CPLR 3211(a)(8) to dismiss the complaint insofar as asserted against her for lack of personal jurisdiction.”).

CPLR 308(2) - Mailing to residence via certified mail was sufficient

Zabari v. Zabari, 154 A.D.3d 613, 63 N.Y.S.3d 364 (1st Dep’t 2017) (“Because the documents were mailed to defendant’s residence (in addition to his place of business), plaintiff was not required to send them by first class mail, and the use of certified mail was sufficient (citations omitted).”).

CPLR 308(2) - Defendant presented evidence establishing that he was residing in Virginia at the time the summons and amended complaint were served at the D.C. address and at the mother’s address

Alostar Bank of Commerce v. Sanoian, 153 A.D.3d 1659, 61 N.Y.S.3d 7595 (4th Dep’t 2017) (“Appeal from an order of the Supreme Court, Niagara County (Frank Caruso, J.), entered October 26, 2015. The order denied the motion of defendant to vacate a default order and judgment, determined that plaintiff has established jurisdiction over defendant and directed that plaintiff is allowed to enforce its judgment. … Although those two affidavits establish prima facie that defendant was validly served, defendant submitted evidence that rebuts the presumption and establishes as a matter of law that he was improperly served, which obviates the need for a traverse hearing (citation omitted). Namely, defendant presented evidence establishing that he was residing in Virginia at the time the summons and amended complaint were served at the D.C. address and at the mother’s address. Plaintiff failed to submit any evidence demonstrating otherwise. Thus, we conclude that, inasmuch as plaintiff failed to serve defendant at his actual address, as is required by both CPLR 308 (2) and (4), the court lacked personal jurisdiction over defendant (citations omitted). We reject plaintiff’s contention that defendant received actual notice of the action and thus was properly served. It is well settled that ‘notice received by means other than those authorized by statute cannot serve to bring a defendant within the jurisdiction of the court’ (citations omitted). We therefore reverse the order and grant defendant’s motion to vacate the default judgment. Because the court never acquired personal jurisdiction over defendant, we dismiss the amended complaint (citation omitted), without prejudice.”).

CPLR 308(4)

David L. Ferstendig, Court Addresses Affixing and Mailing Provision Under New York City Charter, 686 N.Y.S.L.D 3 (2018).).

Court Addresses Affixing and Mailing Provision Under New York City Charter

Only Single Prior Reasonable Attempt at Personal Delivery at the Premises Is Required

In Mestecky v. City of New York, 2017 N.Y. Slip Op. 08162 (November 20, 2017), the Department of Buildings’ inspectors issued nine Notices of Violation (NOV) in connection with the petitioner’s residential property. Each of the NOVs identified the claimed violation and described a single successful effort by the inspector to personally serve the NOV at the premises. The inspector then utilized "alternative service," that is, affixing the NOV to the premises in a conspicuous place and mailing a copy to the petitioner at the premises address (and, for some of the NOVs, at his home).

The petitioner failed to appear on the hearing dates, resulting in administrative default judgments, fines and penalties. At a hearing challenging the NOVs, the petitioner asserted that he did not receive any of the NOVs and argued that more than a single attempt at personal delivery was required before permitting the affix and mail service.

The relevant provision here is New York City Charter § 1049-a(d)(2), which permits the use of affix and mail service after "a reasonable attempt" has been made to deliver the notice "to a person in such premises upon whom service may be made as provided for by article three of the civil practice law and rules or article three of the business corporation law."

The "generic" nail and mail service that most of us are familiar with is contained in CPLR 308(4). There, the statute expressly states that the resort to nail and mail service can only be made upon a showing that service by personal delivery (CPLR 308(1)) or leave and mail (CPLR 308(2)) could not be effected with "due diligence." The latter requirement has been interpreted to require multiple attempts at different times. See e.g., Sinay v. Schwartzman, 148 A.D.3d 1068 (2d Dep’t 2017).

The petitioner here argued that by referencing CPLR Article 3, the relevant charter provision incorporated the "due diligence" requirement of CPLR 308(4), as interpreted by case law. Thus, the petitioner maintained that the single attempt to deliver the NOVs to a person at the premises was insufficient.

The Court of Appeals rejected the argument. It focused on the language of New York City Charter § 1049-a(d)(2), which begins with a general rule that CPLR Article 3 service rules apply, and follows with certain alternative service exceptions, including the one relevant here. Thus, to read the provision in the manner advocated by the petitioner

would make the exception indistinguishable from the general rule, thereby rendering it superfluous. Considered in context, the only reasonable conclusion is

that the cross-reference to CPLR article 3 and Business Corporation Law article 3 in the exception was intended to import the provisions of those articles clarifying the parties or entities who can accept service, such as the clause permitting delivery to "a person of suitable age and discretion" (see CPLR 308[2]). Indeed, this is the most natural reading of section 1049-a(d)(2)(b) given that the phrase containing the statutory cross-references directly follows the clause requiring "a reasonable attempt" to deliver the notice "to a person in such premises upon whom service may be made."

Mestecky, 2017 N.Y. Slip Op. 08162, at ∗4–5.

Moreover, the Court pointed to language in the statute which talks in terms of "a reasonable attempt," that is, the use of the singular "attempt" (as opposed to multiple attempts). As a result, the statutory language supported the conclusion that a single attempt at personal delivery was required. The Court added that the legislative history further supported this interpretation, because it stressed the difficulties encountered in identifying and locating the persons responsible for the violation(s), and frequent amendments have thus sought to liberalize the service rules to deal with the widespread problem of violators avoiding service.

Finally, the Court concluded that the procedure providing for a single attempt to deliver the NOV personally followed by affix and mail "is reasonably calculated to inform owners of violations relating to their properties." Id. at ∗5.

CPLR 308(4) - Due diligence requirement met

Nationstar Mtge., LLC v. Dekom, 161 A.D.3d 995 (2d Dep’t 2018) (“In this case, the plaintiff submitted affidavits from the process server which demonstrated that four visits were made to the defendant’s residence at different times when the defendant could reasonably have been expected to be found at home. The process server also described the means she used to verify the defendant’s residential address, and described her unsuccessful attempt to ascertain the defendant’s place of employment. We agree with the Supreme Court that the affidavits constituted prima facie evidence that the due diligence requirement was satisfied (citation omitted). The affidavits also constituted prima facie evidence that the process server properly affixed a copy of the summons and complaint to the door of the defendant’s residence, and mailed a copy to the residence by first class mail. Contrary to the defendant’s contention, he failed to rebut the presumption of proper service arising from the process server’s affidavits. Further, the summons contained statutorily mandated language warning the defendant that the failure to serve an answer to the complaint may result in a default judgment and advising him to speak to an attorney (citation omitted).”).

U.S. Bank, N.A. v. Cepeda, 155 A.D.3d 809, 64 N.Y.S.3d 104 (2d Dep’t 2017) (“Here, the affidavit of the process server demonstrated that three visits were made to the homeowner’s residence, each on different days and at different times of the day. The process server also described in detail his unsuccessful attempt to obtain an employment address for the homeowner, including interviewing a neighbor. Under these circumstances, the Supreme Court improperly concluded that the due diligence requirement was not satisfied (citations omitted).”).\

Velez v. Forcelli, 152 A.D.3d 630, 61 N.Y.S.3d 24 (2d Dep’t 2017) (“Here, the evidence elicited at the hearing demonstrated that seven visits were made to the defendant’s residence at different times, including those times when the defendant could reasonably have been expected to be found at his residence (citations omitted). It was further established at the hearing that the process server sufficiently confirmed that the defendant resided at the premises at which service was attempted. While there was no evidence presented at the hearing of unsuccessful attempts by the process server to obtain an employment address for the defendant, it is undisputed that the defendant was out of work due to injuries he sustained in a car accident. Contrary to the defendant’s contention, under these circumstances, the Supreme Court properly concluded that the due diligence requirement was satisfied (citations omitted).”).

CPLR 308(4) - Failure to meet due diligence requirement

Faruk v. Dawn, 2018 NY Slip Op 04307 (2d Dep’t 2018) (“Here, the submissions in support of the plaintiff's motion contained numerous inconsistent dates regarding when service was attempted and made upon the defendant. Even accepting the dates of attempted service claimed by the plaintiff, those attempts were ‘made on weekdays during hours when it reasonably could have been expected that [the defendant] was either working or in transit to work’ (citations omitted). Moreover, there is no indication that the process server made any attempt to locate the defendant's place of employment so he could attempt to effectuate service there (citations omitted). Under these circumstances, the plaintiff failed to establish that he exercised due diligence in attempting to effectuate service pursuant to CPLR 308(1) or (2) before resorting to service pursuant to CPLR 308(4) (citations omitted).”).

Greene Major Holdings, LLC v. Trailside At Hunter, LLC, 148 A.D.3d 1317, 49 N.Y.S.3d 769 (3d Dep’t 2017) (“Here, the record reflects that plaintiff’s process server attempted to serve defendant at a particular residence in Evanston, Illinois on three occasions — on December 10, 2013 at 8 -59 p.m., on December 11, 2013 at 5 -17 p.m. and on December 13, 2013 at 4 -19 p.m. Although the parties debate whether the subject residence actually constituted Rem’s dwelling place or usual place of abode and, hence, whether the documents in question were properly affixed thereto, this issue need not detain us, as we agree with Supreme Court that the underlying service attempts — all of which occurred on weekdays and two of which occurred during hours that Rem reasonably could be expected to be either at or in transit from work — fall short of establishing due diligence in the first instance (citations omitted). For this reason alone, Supreme Court properly concluded that plaintiff, having failed to comply with the service requirements of RPAPL 1371 (2) and CPLR 308 (4), did not obtain personal jurisdiction over Rem. Accordingly, the court was well within its discretion in granting Rem’s motion to vacate the deficiency judgment entered against him and, as such, Supreme Court’s June 2015 order is affirmed.”).

CPLR 308(4) - General Business Law § 13 - Need hearing to determine whether service on a Sabbath observer on Saturday was done with malice

JPMorgan Chase Bank, N.A. v. Lilker, 153 A.D.3d 1243, 61 N.Y.S.3d 578 (2d Dep’t 2017) (“The defendants contend that the plaintiff’s counsel was aware that they are observant, Orthodox Jewish persons who adhere to the Sabbath, and thus, the Saturday affixation of process to the door of their residence was invalid. This appears to be an issue of first impression for this Court. We agree with the other courts that have addressed the issue, which have consistently held, for more than a century, that service in violation of General Business Law § 13, or its predecessor statute, is void, and personal jurisdiction is not obtained over the party served (citations omitted). Moreover, we hold that the statute applies not only to personal service upon a defendant, but also to the affixation portion of ‘nail and mail’ service pursuant to CPLR 308(4) on the door of a defendant’s residence, as occurred here (citations omitted). To establish a violation of General Business Law § 13, malicious intent must be shown (citations omitted). ‘Service on the Sabbath . . . with knowledge that the person to be served observes the Sabbath . . . constitutes malice’ (citations omitted). The knowledge of a plaintiff or its counsel is imputed to the process server by virtue of the agency relationship (citations omitted). In support of their motion, the defendants submitted an August 26, 2013, letter from their counsel which advised the plaintiff’s counsel’s law firm that the defendants are ‘observant, Orthodox Jews,’ who cannot be served on a Saturday, together with a fax transmission report indicating a successful transmission. This proof was sufficient to establish, prima facie, that the plaintiff’s counsel had knowledge that the defendants were protected from Saturday service by General Business Law § 13 (citations omitted). However, in opposition, the plaintiff submitted a denial by its counsel of receipt of the faxed letter, and an affidavit by the law firm’s independent information technology contractor to the effect that there was no indication of receipt in the firm’s archive system. These submissions raised a question of fact as to whether the plaintiff’s counsel had knowledge that the defendants could not properly be served on a Saturday, necessitating a hearing (citations omitted).”).

CPLR 308(4) - Issue of fact as to whether pleadings were affixed to door of condominium unit, or exterior door of condominium complex

Sinay v. Schwartzman, 148 A.D.3d 1068, 50 N.Y.S.3d 141 (2d Dep’t 2017) (“Service was made by ‘affix and mail’ service pursuant to CPLR 308(4), which permits such service only where personal delivery or delivery to a person of suitable age and discretion ‘cannot be made with due diligence.’ Attempts at service at different times, including a Saturday, which the process server claimed were accomplished in this case, have been deemed sufficient to establish that service by personal delivery or delivery to a person of suitable age and discretion ‘cannot be made with due diligence’ (citations omitted). However, the defendants raised issues of fact as to whether ‘affix and mail’ service was properly made, i.e., whether the summons and complaint were affixed to the door of their condominium unit, rather than the exterior door of the condominium complex (citations omitted). Under the circumstances, a hearing to determine the validity of service upon the defendants was warranted.”).

CPLR 308(5) - Court refuses to permit Facebook service

David L. Ferstendig, This Time Service of Process by Facebook Is Not Permitted Under CPLR 308(5), 674 N.Y.S.L.D. 3-4 (2017).

In the July 2015 edition of the Digest, we discussed Baidoo v. Blood-Dzroky, 48 Misc. 3d 309 (Sup. Ct., N.Y. Co. 2015), in which Justice Matthew Cooper permitted Facebook service pursuant to CPLR 308(5) in a divorce action. Critically, Justice Cooper found that the plaintiff had established that the Facebook account she identified actually belonged to the defendant and that the defendant regularly logged into his account. The standard to apply to determine whether a particular method of service is proper is whether the service comports with the fundamentals of due process by being reasonably calculated to provide the defendant with notice. If one walked away from the Baidoo decision with the impression that the floodgates were about to open permitting widespread Facebook or other social media or email service, he or she would have reached the wrong conclusion. In fact, Justice Cooper’s meticulously written decision suggests that courts will permit such service in very limited circumstances.

Qaza v. Alshalabi, 2016 N.Y. Slip Op. 26402 (Sup. Ct., Kings Co. December 5, 2016), is a more recent case in which the court refused to permit Facebook service. Qaza was also a divorce case, in which the plaintiff-wife alleged that the defendant-husband left the marital residence three months after they were married without providing any contact information. The plaintiff believed that the defendant had been deported and was living in Saudi Arabia. She maintained that all attempts to locate the defendant had failed and she could not serve him under the Hague Convention because Saudi Arabia was not a signatory. Finally, the cost of publication in a local newspaper was prohibitively expensive. As a result, the plaintiff was seeking “publication to Facebook” of the summons, pursuant to CPLR 308(5). The court here, however, found that the plaintiff had failed to sufficiently authenticate the Facebook profile as being the defendant’s or establish that the defendant actually used the Facebook page to communicate or receive messages. Thus, it concluded that “plaintiff has not demonstrated that, under the facts presented here, service by Facebook is reasonably calculated to apprise defendant of the matrimonial action.” Id. at *4.

The court noted the particular due process concerns associated with a divorce action -

The act for divorce has a multitude of ancillary affects [sic] on the rights and liabilities of parties. The Court must be scrupulous in allowing service by a methodology most likely to give notice not only [to] one’s economic responsibilities and rights to pay and receive maintenance and child support but rights to property, inheritance and most importantly the Constitutional right to custody and visitation (citation omitted). If the standard for review of an agreement in any matrimonial action is higher than that in a plenary action certainly the Court must be satisfied that there is some semblance of due process notice (citation omitted).

Id.

The court concluded that “[g]ranting this application for service by Facebook under the facts presented by plaintiff would be akin to the Court permitting service by nail and mail to a building that no longer exists.” Id. at*5.

With the emphasis on communication via email and social media, there has been a push to “update” our service statutes to provide for such service, perhaps as a separate enumerated basis in CPLR 308, for example. However, each of these methods of service has its own problems which raise due process concerns. For example, service by email is complicated by spam folders that may prevent the delivery of emails and the general warning not to open emails from persons you do not recognize. Moreover, as the Qaza court stated, “anyone can create a Facebook profile.” Id. So while the communications of the future outside of litigation will continue to migrate electronically, it is doubtful that electronic service of process will become an enumerated authorized method of service under CPLR 308 any time soon. Of course, CPLR 308(5) provides the court with an opportunity to use such service in the appropriate case, where the particular defendant’s due process rights are properly considered and protected.

CPLR 308(5) - Court ordered service on insurance carrier

Matthews v. Barrau, 150 A.D.3d 836, 55 N.Y.S.3d 282 (2d Dep’t 2017) (“Here, the Supreme Court providently exercised its discretion in granting that branch of the plaintiffs’ cross motion which was to direct an alternative method for service of process upon the defendant, as the plaintiffs submitted evidence indicating, inter alia, that the defendant retired from his business, left New York, and was residing at an unspecified location in Haiti, and, thus, that service by the methods set forth in CPLR 308(1), (2), and (4) was impracticable (citations omitted). Moreover, as the plaintiffs submitted evidence that the defendant had been in contact with his excess liability insurance carrier with regard to the plaintiffs’ action, the court providently directed service upon the insurance carrier, as this method of service was reasonably calculated to apprise the defendant of the pending action against him and afford him an opportunity to be heard (citations omitted).”).

CPLR 308(5) - Service via email permitted

Kozel v. Kozel, 161 A.D.3d 700 (1st Dep’t 2018) (“Here, Inga left the jurisdiction after the same court and Justice found her in contempt, and offers no evidence that she was at either her residence in London or Lithuania. Under these circumstances, the court properly directed that she be served via email (citation omitted). Since Inga was properly served with the contempt motion, and had knowledge of the terms of the subject orders of which she was in violation, the court was empowered to find her in contempt without plaintiff commencing a special proceeding (citation omitted).”).

CPLR 308(5) - Service via certified mail, return receipt requested, plus regular mail permitted

Matter of Hunter v. Brown-Ledbetter, 160 A.D.3d 955, 75 N.Y.S.3d 499 (2d Dep’t 2018) (“Although the mother is correct that the father had the burden to demonstrate that he properly served her and that the Family Court had acquired jurisdiction over her (citations omitted), her

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. claim that the father failed to meet that burden is without merit. The court providently exercised its discretion in authorizing the father to serve the mother via certified mail, return receipt requested, plus regular mail, in light of the evidence that the mother was deliberately evading service (citations omitted). Likewise, the father met his burden of establishing service by proffering the return receipt and an affidavit of service by mailing, and the mother proffered no evidence rebutting this showing (citations omitted).”).

CPLR 311 - Personal service on corporation or governmental subdivision

CPLR 311 / 311-a - Affidavit of compliance’ compare BCL 307 and Limited Liability Company Law § 304

Chan v. Onyx Capital, LLC, 156 A.D.3d 1361, 67 N.Y.S.3d 748 (4th Dep’t 2017) (“It is well settled that ‘[s]trict compliance with Limited Liability Company Law § 304 is required, including as to the filing of an affidavit of compliance’ (citations omitted). The Court of Appeals in Flick v. Stewart-Warner Corp. (citations omitted) analyzed Business Corporation Law § 307, which is substantively identical to Limited Liability Company Law § 304. The Court explained that “the statute contains procedures calculated to assure that the foreign corporation, in fact, receives a copy of the process” (citation omitted). The Court held that ‘[t]he proof called for in the affidavit of compliance is that the required actual notice has been given either by personal service or by registered mail . . . These are not mere procedural technicalities but measures designed to satisfy due process requirements of actual notice’ (citation omitted). In this case, as outlined above, plaintiff failed to comply with step two of Limited Liability Company Law § 304. We reject plaintiff’s contention that nothing more was required of her after the registered mail was returned as undeliverable. Inasmuch as plaintiff failed to comply with step two, she necessarily also failed to comply with step three, which would show that a party complied with the service requirements of section 304.”).

CPLR 311(a)(6) - Service on village

Ryan v. Village of Lindenhurst, Inc., 151 A.D.3d 898, 57 N.Y.S.3d 189 (2d Dep’t 2017) (“The Village’s attorney and Madlon, Deputy Village Clerk, stated, based upon personal knowledge, that Bodenschatz, the person served, was the Village’s purchasing agent. The plaintiffs argue that the fact that Bodenschatz was the Village’s purchasing agent did not mean that she was not a mayor, clerk, or trustee. However, at the time of service of process, Thomas A. Brennan was identified by the plaintiffs as the Mayor, Shawn Cullinane was identified as Village Clerk, Madlon was identified as Deputy Village Clerk, and other named parties were identified as Village Trustees. Bodenschatz was not among them. Service upon a village by leaving papers with a person other than a mayor, clerk, or trustee is insufficient (citation omitted). Since the Village was not properly served, it had no obligation to appear in the action, or to present evidence of a potentially meritorious defense (citation omitted).”).

CPLR 312-a - Service by mail

CPLR 312-a - Plaintiff moves for immediate judgment in the amount of $110.53, for the amount expended by plaintiff in serving defendants by the alternative method of service of process

McGriff v. Mallory, 160 A.D.3d 1460, 72 N.Y.S.3d 912 (4th Dep’t 2018) (“Plaintiff commenced this negligence action by serving defendants by mail pursuant to CPLR 312-a (a) and thereafter utilized ‘an alternative method’ of service of process when ‘the acknowledgment of receipt’ was not returned by defendants or the other persons set forth in CPLR 312-a (b) within the requisite 30-day period. Plaintiff moved for, inter alia, an immediate judgment in the amount of $110.53, i.e., the amount expended by plaintiff in serving defendants by the alternative method of service of process (citation omitted). We agree with plaintiff that Supreme Court erred in denying that part of plaintiff's motion (citation omitted). Here, plaintiff submitted prima facie evidence that his attorney mailed the requisite documents to defendants pursuant to CPLR 312-a (a), and defendants failed to raise an issue of fact with respect to that service.”).

DEFENDANT’S APPEARANCE

CPLR 320 - Defendant’s appearance

CPLR 320 / 3012(b) - Potential trap of serving notice of appearance

David L. Ferstendig, The Potential Trap of Serving a Notice of Appearance, 682 N.Y.S.L.D. 3 (2017).

The waiver of defenses can be avoided in most circumstances merely by including them either in an answer or in a pre-answer motion to dismiss. See CPLR 3211(e). Jurisdictional objections present additional challenges and requirements. For example, if the defendant moves to dismiss under CPLR 3211(a) on any ground, jurisdictional objections must be included or waived. In addition, if one includes a service defense in the answer, a motion must be made within 60 days thereafter to resolve that issue.

But sometimes an action is commenced via service of a summons with notice. There, the defendant’s response is first to serve a demand for a complaint or a notice of appearance. Technically, they are to have the same requisite effect, that is, to compel the plaintiff to serve a complaint. Moreover, reading CPLR 320 together with CPLR 3211(e), there should be no waiver by the defendant of any defense when serving a demand or notice of appearance, because he or she will have an opportunity to assert it in the answer or pre-answer motion to dismiss. See, e.g., Balassa v. Benteler-Werke A. G., 23 A.D.2d 664 (2d Dep’t 1965).

Nevertheless, in response to a summons with notice, I always serve a demand for a complaint to avoid any “misunderstandings” that by serving a notice of appearance I have somehow waived something.

However, apparently not all notices of appearance are the same. Sometimes, in very rare instances, defendant’s counsel will serve a notice of appearance without having been served with a summons with notice. For example, a defendant may serve a notice of appearance merely to be aware of developments in a case. See, e.g., Tsionis v. Eriora Corp., 123 A.D.3d 694, 696 (2d Dep’t 2014) (“Contrary to the plaintiffs’ contention, the appellant was not required to serve an answer where the complaint did not set forth any allegations that the appellant was required to defend against. ‘A defendant who has no defense, and therefore serves no pleading, might nevertheless serve a notice of appearance so as to be kept apprised of the progress of the proceeding.’ Such was the situation here.”) (citing Weinstein, Korn & Miller, New York Civil Practice, CPLR 320.03 (David L. Ferstendig, LexisNexis Matthew Bender, 2d Ed.).).

A more recent case presented a different scenario. American Home Mtge. Servicing, Inc. v. Arklis, 150 A.D.3d 1180 (2d Dep’t 2017) was a mortgage foreclosure action, in which the defendant initially failed to answer, resulting in the entry of a default judgment (over a year-and-a-half after the alleged service) and the appointment of a referee to compute what was due to the plaintiff. Just over two-and-a-half years later, at a foreclosure settlement conference, defendant’s attorney executed a form notice of appearance. Almost two years after that, the plaintiff’s assignee moved for leave to enter a judgment of foreclosure and sale. The defendant crossmoved to dismiss under CPLR 3211(a)(8) for lack of personal jurisdiction based on improper service, noting specifically that the defendant was not moving to vacate a default judgment under CPLR 5015(a)(1) or CPLR 317. However, the trial court “deemed” the cross-motion to be pursuant to CPLR 5015, and found that the defendant was never served and the default judgment to be a nullity.

The Appellate Division reversed, holding that the defendant waived her jurisdictional defense -

“By statute, a party may appear in an action by attorney (CPLR 321), and such an appearance constitutes an appearance by the party for purposes of conferring jurisdiction.” Here, the defendant’s attorney appeared in the action on her behalf by filing a notice of appearance on July 25, 2012, and neither the defendant nor her attorney moved to dismiss the complaint on the ground of lack of personal jurisdiction at that time or asserted lack of personal jurisdiction in a responsive pleading. Accordingly, the defendant waived any claim that the Supreme Court lacked personal jurisdiction over her in this action (citations omitted).

Id. at 1181–82.

While the above fact pattern may be unusual and perhaps presents itself primarily in mortgage foreclosure actions, defendants should generally stay away from using a “notice of appearance.” When served with a summons with notice, respond with a demand for a complaint. And, of course, preserve your defenses in your answer or a pre-answer motion to dismiss.

The Commercial Division of the Supreme Court continues to adopt rules designed to streamline and improve the litigation process.

CPLR 320 / 3012 - Serving demand for complaint

A defendant cannot demand a complaint before being served with a summons with notice. See Micro-Spy, Inc. v. Small, 9 A.D.3d 122, 778 N.Y.S.2d 86 (2d Dep’t 2004) (service of demand for complaint after filing of summons but before service was premature). However, a defendant can serve a demand after the plaintiff serves the defendant pursuant to CPLR 308(2), but before the plaintiff has filed the proof of service and service is complete. See Wimbledon Fin. Master Fund, Ltd. v. Weston Capital Mgt. LLC, 150 A.D.3d 427, 55 N.Y.S.3d 1 (1st Dep’t 2017) (“Plaintiff commenced this securities fraud action against 26 defendants by filing a summons with notice on October 16, 2015, and served defendant Manley pursuant to CPLR 308(2) twelve days later. On November 3, 2015, before plaintiff had filed proof of service, defendant served a demand for a complaint pursuant to CPLR 3012(b). Plaintiff, taking the position that the demand was a nullity, asked defendant to agree to accept a complaint served by the end of December. Defendant refused, and instead moved to dismiss the action on November 24, the 21st day after service of its demand. Plaintiff served a complaint on December 24, 2015. We agree with the motion court that under CPLR 3012(b), defendant was permitted to serve a demand for a complaint after being served, notwithstanding that service was not technically ‘complete.’ The time frames applicable to defendants set forth in CPLR 3012(b) are deadlines, not mandatory start dates (citations omitted). In the cases relied on by plaintiff, the defendants’ demands were ineffective to trigger plaintiff’s time to serve a complaint pursuant to CPLR 3012(b) because the defendants had not yet been served with a summons with notice, and the CPLR makes no provision for an appearance or a demand for a complaint before the summons is served (citations omitted).”).

CPLR 321- Attorneys

CPLR 321(a) - Compliance with section does not implicate subject matter jurisdiction

Hamilton Livery Leasing, LLC v. State of New York, 151 A.D.3d 1358, 58 N.Y.S.3d 624 (3d Dep’t 2017) (“Here, defendant does not point to any service or filing provision — or any other provision — of the Court of Claims Act that prohibits claimant from pro se representation. Instead, defendant relies on CPLR 321 (a), which provides that, subject to express exceptions, a ‘corporation or voluntary association shall appear by attorney’ to ‘prosecute or defend a civil action,’ and ‘like a corporation or a voluntary association, [an] LLC may only be represented by an attorney and not by one of its members who is not an attorney admitted to practice in the state of New York’ (citation omitted). Thus, as an initial matter, we conclude that compliance with CPLR 321 (a) does not implicate subject matter jurisdiction, as compliance with that provision is not a prerequisite to the waiver of sovereign immunity pursuant to the Court of Claims Act (citation omitted)…Accordingly, we hold that, under these circumstances, the irregularity of claimant’s initial filing was one that the Court of Claims could have disregarded, given counsel’s subsequent appearance on behalf of claimant, by granting so much of claimant’s motion to amend the claim as added counsel’s signature (citations omitted).”).

REMOVAL

CPLR 325 - Grounds for removal

CPLR 325(b) - Motion must be accompanied by a request for leave to amend the ad damnum clause of the complaint

Hart v. New York City Hous. Auth., 161 A.D.3d 724 (2d Dep’t 2018) (“A motion to remove an action from the Civil Court to the Supreme Court pursuant to CPLR 325(b) must be accompanied by a request for leave to amend the ad damnum clause of the complaint pursuant to CPLR 3025(b) (citation omitted). Here, the amount stated in the ad damnum clause was within the jurisdictional limits of the Civil Court, and no request for leave to amend the ad damnum clause was made. In the absence of an application to increase the ad damnum clause, the plaintiff’s motion to remove the action to the Supreme Court should have been denied (citations omitted). Accordingly, we remit the matter to the Supreme Court, Kings County, to restore the matter to the Civil Court, Kings County.”).

FORUM NON CONVENIENS

CPLR 327 - Defendant did not waive FNC objection by participating in action

Aina v. American Univ. of Antigua, 161 A.D.3d 508, 73 N.Y.S.3d 430 (1st Dep’t 2018) (“This action, where plaintiff, a former student of defendant’s medical school, alleges that he was discriminated against, was properly dismissed on the ground of forum non conveniens (citations omitted). Neither party is a New York resident and the underlying conduct took place in Georgia or Antigua, where the vast majority of witnesses and documents are located. Plaintiff does not contend that New York law applies to his claim, or that Georgia or Antigua are not adequate alternative fora. The fact that defendant retains a New York firm to provide administrative support is not sufficient to render New York an appropriate forum. Defendant did not waive its right to challenge the New York forum by participating in the instant litigation, as its participation has been minimal. Defendant filed this motion shortly after filing its amended answer, and before plaintiff had replied to its counterclaims. Although defendant served discovery demands and participated in a scheduling conference, no discovery had yet been exchanged and there were no prior motions. It is further noted that defendant made clear in both its answer and amended answer that it intended to assert forum non conveniens as an affirmative defense, and expressly agreed to dismissal of its counterclaims on that basis.”).

CPLR 327 - FNC motion denied; plaintiff NY resident; defendants have substantial connections to NY; delay in bringing motion

Bacon v. Nygard, 160 A.D.3d 565, 76 N.Y.S.3d 27 (1st Dep’t 2018) (“It is true that the alleged defamation related to events occurring in the Bahamas, and that some of the nonparty witnesses and documents are likely to be located in the Bahamas. However, this is not dispositive (citations omitted). Plaintiff is a New York resident. While also not dispositive, this is generally ‘the most

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. significant factor in the equation’ (citation omitted). In addition, only one of the defendants is a resident of the proposed alternative forum (the Bahamas), and all of the defendants have substantial connections to New York (citations omitted); and although defendants claim that Nygard International Partnership's principal place of business is in Canada, its website identifies New York as its ‘World Headquarters.’ Because defendants have a substantial presence in New York, as well as ‘ample resources,’ it would not be a hardship for them to litigate here (citation omitted). The burden on the New York courts is also minimal. There is no need to translate documents or witness testimony from a foreign language. Plus, defendants effectively conceded that New York law applies by relying on it in their prior motion to dismiss and in their counterclaims (citation omitted). By contrast, plaintiff would suffer hardship if required to litigate in the Bahamas, which has no jury trial right and no mechanism to obtain pre-trial deposition testimony from Bahamian witnesses (citations omitted). The fact that defendants waited fourteen months before bringing the instant motion, until after discovery began, their prior motion to partially dismiss the complaint was granted and affirmed on appeal, and plaintiff's motion to dismiss their counterclaims was granted, also counsels against dismissal (citations omitted). The parties have since exchanged several thousand pages of documents and completed five depositions. The fact that there are currently twelve related actions pending in the Bahamas cuts the other way (citations omitted). However, only one of these involves any of the instant defendants, and it is not for defamation and was instituted after the instant action.”).

CPLR 327 - FNC motion denied; various factors considered

Pacific Alliance Asia Opportunity Fund L.P. v. Kwok Ho Wan, 160 A.D.3d 452 (1st Dep’t 2018) (“Defendant failed to meet the heavy burden of establishing that New York is an inconvenient forum and that there is no substantial nexus between New York and this action (citation omitted). It is true that the agreements at issue in this breach of contract action concern a Chinese real estate development project and that most (although not all) of them were negotiated and executed in Hong Kong or China. However, while defendant is a Chinese citizen, he has resided in New York for the past two years and is seeking asylum here (citation omitted). Moreover, although Hong Kong is a potential alternative forum, it is not a suitable or adequate alternative, because defendant cannot return there due to his pending asylum claim and fugitive status (citations omitted). Defendant has not shown that it will be a hardship for him to litigate in New York. He lives here, has brought suit against others here, and has invited others to sue him here. The agreements at issue, which are written in English, are available here, and, although plaintiff is a foreign corporation, its employees are willing to travel here at no expense to defendant (citation omitted). While defendant alleges broadly that his former employees and relevant documents are located in Hong Kong or China, he has not identified any specific witnesses or documents that will be necessary (citation omitted). He does not purport to know the witnesses' whereabouts with certainty, and he has not made any showing with respect to their materiality (citation omitted). The fact that Hong Kong law governs the instant dispute, pursuant to the choice of law provisions in the agreements, is not dispositive, since ‘our courts are frequently called upon to apply the laws of foreign jurisdictions’ (citation omitted). Moreover, Hong Kong law is the only foreign jurisdiction's law at issue (citations omitted).”).

CPLR 327 - Forum non convenience motion granted even though the plaintiff alleged that he sustained personal injuries when the defendant assaulted him on a plane at John F. Kennedy Airport

Park v. Heather Hyun-Ah Cho, 153 A.D.3d 1311, 60 N.Y.S.3d 482 (2d Dep’t 2017) (“On a motion pursuant to CPLR 327 to dismiss the complaint on the ground of forum non conveniens, the burden is on the movant to demonstrate the relevant private or public interest factors that militate against a New York court’s acceptance of the litigation (citations omitted). ‘Among the factors the court must weigh are the residency of the parties, the potential hardship to proposed witnesses, the availability of an alternative forum, the situs of the actionable events, and the burden which will be imposed upon the New York courts, with no one single factor controlling’ (Kefalas v. Kontogiannis, 44 AD3d 624, 625). A court’s determination of a motion to dismiss on the ground of forum non conveniens will not be disturbed on appeal unless the court failed to properly consider all the relevant factors or improvidently exercised its discretion in deciding the motion (citations omitted). Here, the plaintiff alleges that he sustained personal injuries when the defendant assaulted him on a plane at John F. Kennedy Airport in Queens, New York. However, both the plaintiff and the defendant are Korean citizens who reside in Seoul, the plaintiff received medical treatment for the injuries he allegedly sustained as a result of the incident in Korea, and criminal charges stemming from the incident were brought against the defendant in Korea. Under these circumstances and considering all of the relevant factors, including the fact that all potential witnesses are in Korea, we find no basis to disturb the Supreme Court’s determination (citations omitted).”).

CPLR 327(b) - FNC unavailable

Honeywell Intl. Inc. v. ARC Energy Servs., Inc., 152 A.D.3d 444, 55 N.Y.S.3d 658 (1st Dep’t 2017) (“Plaintiff and defendant ARC entered into a services agreement which included an explicit choice of law and forum provision selecting New York law and New York courts. Supreme Court erred in considering ARC’s forum non conveniens argument. ‘[W]here a party to a contract has agreed to submit to the jurisdiction of a court, that party is precluded from attacking the court’s jurisdiction on forum non conveniens grounds’ (citations omitted). Moreover, the services agreement satisfied the requirements of NY General Obligations Law §§ 5-1401 and 5-1402, and therefore, the court did not have discretion under CPLR 327(b) to consider the forum non conveniens argument.”).

ARTICLE 4 - SPECIAL PROCEEDINGS

CPLR 402 - Pleadings in special proceedings

CPLR 402 - Cross claim is not permitted in a special proceeding without leave of court

Matter of Espinal v. Sosa, 153 A.D.3d 819, 61 N.Y.S.3d 566 (2d Dep’t 2017) (“The Supreme Court properly dismissed Sosa’s cross claim to validate his designating petition. Although the cross claim was denominated as a counterclaim, it was properly a cross claim because it sought

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. relief against the Board, which was a respondent in the proceeding (citation omitted). Pursuant to CPLR 402, the pleadings in a special proceeding are limited to a petition, an answer, and a reply to any counterclaim asserted. ‘The court may permit such other pleadings as are authorized in an action upon such terms as it may specify’ (citation omitted). ‘[A] cross claim is not permitted in a special proceeding without leave of court’ (citations omitted). Here, Sosa did not seek leave to interpose a cross claim, and thus, the cross claim was not properly before the court (citations omitted). In any event, Sosa’s cross claim was insufficiently pleaded as a matter of law (citation omitted).”).

CPLR 403 - Notice of petition; order to show cause

CPLR 403[a] / 2001

David L. Ferstendig, Court’s Ability to Correct or Disregard Mistakes, Omissions, Defects or Irregularities, 685 N.Y.S.L.D. 3-4 (2017)

Court’s Ability to Correct or Disregard Mistakes, Omissions, Defects or Irregularities

The Third and Fourth Departments Switch Course on Whether the Failure to Include Return Date in Notice of Petition Is Fatal, Precluding a Court’s Resort to CPLR 2001

Generally, CPLR 2001 provides that the court can correct procedural mistakes, omissions, defects or irregularities, “upon such terms as may be just.” Moreover, “if a substantial right of a party is not prejudiced,” the error “shall” be disregarded.

Thus, for example, courts have relied on CPLR 2001 to correct various kinds of defects in a pleading, order or judgment, to correct the names of parties set forth in the summons or other papers if the party was fairly apprised that it was the party intended to be named, to disregard technical defects in motion papers, the failure to include the certificate authenticating the authority of a notary who administered an oath in connection with an affidavit signed outside of New York State, the delay in filing a request for judicial intervention in a residential foreclosure action, the defendant’s failure to include the answer in its initial summary judgment motion papers, but only with its reply affirmation, and to consider CPLR 317 as a basis to vacate a default even where the defendant did not cite to that section. For an exhaustive list of mistakes, omissions, defects, and irregularities that can be corrected or disregarded under CPLR 2001, see Weinstein, Korn & Miller, New York Civil Practice, CPLR ¶ 2001.03 (David L. Ferstendig, LexisNexis Matthew Bender, 2d Ed.).

One of the thornier issues has been mistakes in commencement, and particularly the filing of the initiating pleadings. In Harris v. Niagara Falls Bd. of Educ., 6 N.Y.3d 155 (2006), after making two successful applications to serve late notices of claim, the plaintiff failed to purchase a new index number for a subsequent personal injury action, instead using the same index number as from the prior special proceeding. The Court of Appeals held that the defect did not implicate

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. subject matter jurisdiction, but instead was a waivable defect. Since the defendant had objected in a timely fashion, the action was dismissed.

In response, CPLR 2001 was amended in 2007 (L. 2007, ch. 529, eff. August 15, 2007) to enable a court to correct or ignore mistakes in the commencement process. The amendment specifically referred to filing errors and provided that where the error was a failure to pay the index number fee, the court is to condition the denial of a motion to dismiss on the payment of the applicable fee.

However, the sponsor’s memorandum explained that the amendment was not intended to excuse a complete failure to file the initiating pleadings within the statute of limitations or the failure to file the proper pleadings, for example, filing a “bare summons” (that is, one served without the requisite notice or a complaint). “The purpose of this measure is to clarify that a mistake in the method of filing, AS OPPOSED TO A MISTAKE IN WHAT IS FILED, is a mistake subject to correction in the court’s discretion.” Sponsor’s Mem, Bill Jacket, L 2007, ch. 529. The “failure to file” defect has been interpreted to include both the failure to file initiating pleadings at all, and the failure to file with the proper (county) clerk. See, e.g., Matter of Peterkin v. Marcy Houses, 87 A.D.3d 649 (2d Dep’t 2011) (failure to file a petition constituted non-waivable jurisdictional defect, rendering the proceeding a “nullity”); Matter of Miller v. Waters, 51 A.D.3d 113 (3d Dep’t 2008) (finding failure to file with the proper clerk to be a defect impacting the court’s subject matter jurisdiction). In addition, in Goldenberg v. Westchester County Health Care Corp., 16 N.Y.3d 323, 328 (2011), the Court of Appeals referred to the legislative history of CPLR 2001 and stated that,

[h]ere, plaintiff never filed a summons and complaint. The closest he came was the proposed complaint attached to the petition he filed when seeking permission to file a late notice of claim, itself a prerequisite to the commencement of this action. Given the absence of a summons, there was “a complete failure to file within the statute of limitations,” which CPLR 2001 does not allow a trial judge to disregard.

For some time, the Third Department had held that the failure to include a return date in a notice of petition was not a “mere irregularity”, but instead was fatal, precluding a court’s resort to CPLR 2001. See, e.g, Matter of Lamb v. Mills, 296 A.D.2d 697, 698 (2002), lv. denied, 99 N.Y.2d 501 (2002); Matter of Oates v. Village of Watkins Glen, 290 A.D.2d 758, 759 (2002); Matter of Hawkins v. McCall, 278 A.D.2d 638, 638 (2000), lv denied, 96 N.Y.2d 713 (2001); Matter of Vetrone v. Mackin, 216 A.D.2d 839, 840–41 (1995); Matter of Kalinsky v. State Univ. of N.Y. at Binghamton, 188 A.D.2d 810, 811 (1992). However, recently in Matter of Oneida Pub. Lib. Dist. v. Town Bd. of the Town of Verona, 153 A.D.3d 127 (3d Dep’t 2017), the Third Department reversed course, overruling its prior holdings. It found that the 2007 amendment to CPLR 2001, discussed above, was specifically enacted to permit courts to correct or disregard technical commencement-type defects, like the omission of the return date in a notice of petition in this action:

We now hold that the omission of a return date in a notice of petition does not constitute a jurisdictional defect so as to deprive the court from assessing whether such omission may be excused under CPLR 2001, and our prior decisions stating

to the contrary should no longer be followed for such proposition. . . . “[T]he primary purpose of a petition is to give notice to the respondent that the petitioner seeks a judgment against [a] respondent so that it may take such steps as may be advisable to defend the claim.” A return date accomplishes this purpose by notifying the responding party when responsive papers must be served and when the petition will be heard. Here, the record reflects that respondents had sufficient notice of the petition. Indeed, respondents’ counsel conceded at oral argument before Supreme Court that they had “plenty of time to respond” and, on appeal, they do not contend that they suffered any prejudice. As such, the omission of a return date should have been disregarded as a mere technical infirmity (citations omitted).

Id. at 130.

Shortly, thereafter, the Fourth Department followed suit. See Matter of Kennedy v. New York State Off. for People With Developmental Disabilities, 154 A.D.3d 1346 (4th Dep’t 2017). See also Matter of Bender v. Lancaster Cent. Sch. Dist., 2017 N.Y. Slip Op. 07853 (4th Dep’t Nov. 9, 2017) (“[S]uch a technical defect is properly disregarded under CPLR 2001 so long as the respondent had adequate notice of the proceeding and was not prejudiced by the omission.”).

CPLR 408 - Disclosure in special proceeding

CPLR 408 - Availability of notice to admit in special proceeding

Matter of Moody’s Corp. & Subsidiaries v. New York State Dept. of Taxation & Fin., 141 A.D.3d 997, 35 N.Y.S.3d 785 (3d Dep’t 2016) (“Finally, while a notice to admit is technically available in a special proceeding without leave of court (citations omitted), it is generally used only where there are issues of fact requiring a trial (citation omitted). Here, no trial was pending or warranted and petitioners sought admissions of facts that were either material to the central issues of the proceeding or not relevant to the proceeding. We thus agree that the notice to admit was improper and find that Supreme Court properly denied petitioners’ motion to strike the Department’s responses to the notice to admit (citations omitted).”).

ARTICLE 5 - VENUE

CPLR 501 - Written agreement fixing venue

Tower Broadcasting, LLC v. Equinox Broadcasting Corp., 160 A.D.3d 1435 (4th Dep’t 2018) (“Pursuant to CPLR 501, a ‘written agreement fixing [the] place of trial, made before an action is commenced, shall be enforced upon a motion for change of [the] place of trial.’ Here, the two written agreements that form the basis of plaintiff's causes of action fix the place of trial as Monroe

County. We reject defendant's contention that plaintiff cannot enforce the forum selection provision of the amended settlement agreement entered into between defendant and plaintiff's predecessor in interest. Plaintiff, as the assignee of its predecessor in interest, may enforce the forum selection provisions of that contract inasmuch as an assignee stands in the shoes of the assignor and is thus subject to all the benefits and burdens of the assignor (citations omitted). Moreover, because plaintiff alleges that it owns the tower as the result of the asset purchase agreement executed by plaintiff and its predecessor in interest, the forum selection provision in that agreement may also be enforced. Defendant contends that Chemung County is the ‘proper’ forum on the ground that the tower and the real property upon which it is situated are both located in Chemung County (citations omitted). We reject that contention. First, this action concerns a broadcasting tower, which is a trade fixture and therefore retains its character as personal property (citation omitted). Thus, CPLR 507, which concerns actions involving real property, is inapplicable. Second, although CPLR 508 provides that the ‘place of trial of an action to recover a chattel may be in the county in which any part of the subject of the action is situated at the time of the commencement of the action’ (emphasis added), that section is permissive and not mandatory. Thus, it does not preclude an action in another venue, particularly where, as here, there is a written agreement fixing the place of trial in that other venue.”).

CPLR 503 - Individual can have more than one residence

Johnson v. Finkelstein, 145 A.D.3d 863, 43 N.Y.S.3d 479 (2d Dep’t 2016) (“Further, we note that the ZBA’s reading of this language is consistent with the well-settled principle that an individual can have more than one residence (citations omitted).”).

CPLR 503 - Multiple residences

CPLR 503 - Stay at rehabilitation facility was temporary

Manzo v. Acevedo, 145 A.D.3d 532, 41 N.Y.S.3d 888 (1st Dep’t 2016) (“GC’s argument that Bronx County is an improper venue as its placement in that county is tenuous in view of evidence that its employee, defendant Acevedo, was in a rehabilitation facility in Montrose, New York when the pleadings were served upon his mother at her Bronx County residence, is unavailing given the documentation that Acevedo’s stay at the rehabilitation facility was temporary and that he resided with his mother in Bronx County (citations omitted.)”).

CPLR 503(c) - Residency for venue purpose of domestic or authorized foreign corporation determined by designation of principal office in application for authority. But how about if a different office is designated in the biennial statement?

David L. Ferstendig, Residency for Venue Purposes of Domestic or Authorized Foreign Corporation Determined by Designation of Principal Office in Application for Authority, 678 N.Y.S.L.D. 3, 4 (2017)

CPLR 503(c) provides that, for the purposes of venue, the residency of a domestic corporation or foreign corporation authorized to transact business in New York is the county of its “principal office.” Much of the case law interpreting this section deals with circumstances in which a corporation conducts its business activities in a county other than the one designated in its application for authority. The courts have (generally) held that the designation in the application controls. See, e.g., American Bldrs. & Contrs. Supply Co., Inc. v. Capitaland Home Improvement Showroom, 128 A.D.3d 870, 871 (2d Dep’t 2015). (“Notwithstanding the plaintiff’s assertions to the contrary, it is a resident of New York County for venue purposes. Indeed, the law is clear that ‘[f]or purposes of venue, the sole residence of a foreign corporation is the county in which its principal office is located, as designated in its application for authority to conduct business filed with the State of New York,’ regardless of where it transacts business or maintains its actual principal office (citations omitted).”).

A recent trial court decision raises a different and interesting issue. Business Corporation Law § 408 (BCL) provides that a domestic or foreign corporation must set forth in its biennial statement “[t]he street address of its principal executive office.” What if that office address conflicts with the information provided in any prior original or amended certificate of incorporation? Which county should control for venue purposes? In Astarita v. Acme Bus Corp., 2017 N.Y. Misc. LEXIS 657 (Sup. Ct., Nassau Co. Feb. 14, 2017), a Nassau County judge opined that the biennial statement’s designation should prevail. The court pointed to the Court of Appeals decision from 1859 in Western Transp. Co. v. Scheu, 19 N.Y. 408 (1859), where the Court looked to the certainty of relying on the principal office designation in the certificate of incorporation as a means to “avoid disputes” on the issue. The Astarita court noted that the legislative history behind the adoption of BCL § 408 to “streamline the procedure for making simple changes to corporate information” was consistent with the rationale of Western Transport to provide certainty. It pointed to “the advances in technology and ready internet access,” permitting up to date access to the information contained in the Department of State official database.

Moreover, the court asked that the dissenting opinion in Discolo v. River Gas & Wash Corp., 41 A.D.3d 126 (1st Dep’t 2007) be “revisited.” There, Justice Saxe cited to the similarity between CPLR 503’s use of the term “principal office” and BCL’s § 408 use of “principal executive office,” concluding that to ignore the BCL § 408 designation would appear to be a case of “willful ignorance.” Id. at 128.

The majority relies on the often-cited rule that the sole legal residence of a corporation for venue purposes is the county designated in its certificate of incorporation. I do not dispute that this is the prevailing rule. But, I find it difficult

to accept that the law requires an unthinking, automatic application of this rule where a more recent document, which the law requires a corporation to file every two years with the Department of State, lists the corporation’s “principal executive office” at a location other than the “principal office” listed in the certificate of incorporation. Under these circumstances, the continued automatic application of the rule that we may look only at the certificate of incorporation, and must ignore documents that as a practical matter serve to update the information in that certificate, seems like willful ignorance. It is particularly offensive to permit a defendant to use this rule as a shield to avoid a lawsuit in the only county where its only business is located, and to both select and forever fix the county of venue where it must be sued merely by virtue of the county named years earlier in its certificate of incorporation (citations omitted).

Id. at 127-28.

CPLR 503(c) - Residence of a domestic corporation for venue purposes is the county designated in certificate of incorporation, regardless of fact that corporation maintains offices or facilities in another county

Villalba v. Brady, 2018 NY Slip Op 04518 (1st Dep’t 2018) (“In any event, plaintiff properly placed venue in New York County based upon defendant DM Carpentry Corp.'s certificate of incorporation, filed in 2011, which designated New York County as the location of its corporate office (citations omitted). Although the Brady defendants provided a 2017 printout of information from the Department of State showing that DT Carpentry's initial filing date was 2011 and that its principal executive offices are in Suffolk County, absent any indication that the 2011 certificate of incorporation was ever amended, the residence designated in that certificate controls for venue purposes (citations omitted).”).

Janis v. Janson Supermarkets LLC, 161 A.D.3d 480, 73 N.Y.S.3d 419 (1st Dep’t 2018) (“Wakefern, a foreign corporation, submitted a copy of its application for authorization to conduct business filed with the Secretary of State, in which it identified New York County as ‘[t]he county within this state where its office is to be located’ (citation omitted). Wakefern’s designation of New York County in its application is controlling for venue purposes, even if it does not actually have an office in New York County (citations omitted).”).

Kidd v. 22-11 Realty, LLC, 142 A.D.3d 488, 35 N.Y.S.3d 719 (2d Dep’t 2016) (“‘[T]he sole residence of a domestic corporation for venue purposes is the county designated in its certificate of incorporation, despite its maintenance of an office or facility in another county’ (citations omitted).Here, the defendants failed to submit Abro’s certificate of incorporation or otherwise demonstrate that the certificate of incorporation had been amended to designate Nassau County as the location of Abro’s principal office. Accordingly, the defendants failed to meet their initial burden of demonstrating that Abro’s principal office was located in Nassau County and that the plaintiff’s choice of venue in Kings County, based on Abro’s alleged principal place of business, was improper (citations omitted).”).

CPLR 506(b)(1) - No original subject matter jurisdiction in Appellate Division because no “justice of the supreme court or . . . judge of a county court or the court of general sessions” was named

Matter of Thomas v. Hecht, 142 A.D.3d 1091, 37 N.Y.S.3d 456 (2d Dep’t 2016) (“This Court does not have original subject matter jurisdiction to entertain this proceeding, as no “justice of the supreme court or . . . judge of a county court or the court of general sessions” was named as a respondent (CPLR 506[b][1]). Since subject matter jurisdiction cannot be waived, the petition must be dismissed (citations omitted).”).

CPLR 506(b)(1) - Venue for action against judge with multiple judicial positions is determined by capacity in which judge was serving when taking challenged action

Matter of Tonawanda Seneca Nation v. Noonan, 27 N.Y.3d 713, 715, 37 N.Y.S.3d 36, 38, 57 N.E.3d 1073, 1075 (2016) (“The Nation argues that because Judge Noonan also serves as a County Court Judge, CPLR 506 (b) (1) requires that the proceeding be commenced in the Appellate Division. We reject this argument and hold that the determination of venue for an article 78 proceeding against a multi-bench judge turns on the capacity in which the judge was serving when taking the challenged action. Here, where Judge Noonan was acting as Surrogate with respect to the probate of the will, the Nation’s suit challenging those actions should have been brought in Supreme Court (see CPLR 7804 [b]).”).

CPLR 507 - Does not apply to action seeking determination of individual parties’ rights as shareholders of corporation

Fish v. Davis, 146 A.D.3d 485, 45 N.Y.S.3d 46 (1st Dep’t 2017) (“While CPLR 507 mandates that venue of an action involving title to or possession, use or enjoyment of real property be the county where the property is located (citations omitted), here, the action essentially seeks a determination of the individual parties’ rights as shareholders of defendant corporation, which owns real property in Rockland County (citation omitted). In opposition to the motion, plaintiff demonstrated that subdivision of the property is not possible, and that the complaint seeks either rescission of the shareholders agreement or specific enforcement of its provision requiring the parties to implement a cooperative ownership plan. Accordingly, the court providently exercised its discretion in denying the motion to transfer venue to Rockland County.”).

CPLR 510 / 511[d] / 503(a) - Once plaintiff is wrong on choice of venue, he or she forfeits right and defendant gets to choose proper venue. Plaintiff did not cross-move to retain venue

Nunez v. Yonkers Racing Corp., 153 A.D.3d 1355, 61 N.Y.S.3d 600 (2d Dep’t 2017) (“The plaintiff placed venue of the action in Kings County based on his purported residence but the defendant, in support of its motion, demonstrated that the plaintiff actually resided in Bronx County, not Kings County, at the time of commencement of the action. Thus, the plaintiff’s choice of venue was improper (citation omitted). By selecting an improper venue in the first instance, the plaintiff forfeited the right to choose venue (citations omitted). Contrary to the plaintiff’s contention, the defendant’s motion pursuant to CPLR 510(1) to change venue of the action from

Kings County to Westchester County was addressed to the Supreme Court’s discretion (citations omitted), and was timely as the defendant promptly moved to change venue after ascertaining the plaintiff’s true county of residence (citations omitted). Further, the plaintiff failed to demonstrate that Westchester County, the county specified by the defendant, was improper, and he did not cross-move to retain venue in Kings County or to change venue to a county other than that urged by the defendant (citations omitted).”).

CPLR 510 / 511 / 503 / 507 - Venue improperly placed

Patiwana v. Shah, 2018 NY Slip Op 04746 (2d Dep’t 2018) (“Here, since the plaintiff and the defendants, the only parties to this derivative action (citations omitted), were residents of Nassau County when it was commenced, venue was improperly placed in Queens County. Contrary to the plaintiff's contention, the fact that two of the corporations and the LLC are located in Queens County did not make Queens County a proper venue to commence this action, since those entities are not parties to the action. Furthermore, venue could not have been properly placed in Queens County pursuant to CPLR 507. While CPLR 507 mandates that venue of an action which seeks a judgment that will ‘affect the title to, or the possession, use or enjoyment of, real property’ shall be placed in the county where the property is located (citation omitted), here, the action seeks, inter alia, a determination of the plaintiff's membership interest in the LLC (citations omitted). In opposition to the motion, the plaintiff failed to demonstrate that the relief he is seeking will affect real property in Queens County. The plaintiff failed to move by notice of cross motion to retain venue in Queens County pursuant to CPLR 510(3), and we decline to review the plaintiff's informal request in the exercise of discretion (citations omitted).”).

CPLR 510(2) - Impartial trial

Palma v. Burgos, 147 A.D.3d 426, 45 N.Y.S.3d 798 (1st Dep’t 2017) (“The court’s denial of defendant’s motion was a provident exercise of discretion (citation omitted). Plaintiff is a member of the New York City Council and is Secretary of the Bronx Democratic Committee. These positions held by plaintiff, however, do not justify an inference that a fair trial cannot be held in Bronx County. As in Midonick, the subject motion was based merely upon defendant’s belief that an impartial trial could not be held ‘without any showing of facts and circumstances demonstrating that the belief was well-founded’ (citation omitted). Defendant’s reliance on cases involving motions for a change of venue where judges were involved with a case in the jurisdiction where he or she presided (citations omitted), is misplaced. Plaintiff is not a judge in Bronx County, nor is she closely related to one.”).

United States Fid. & Guar. Co. v. American Re-Insurance Co., 145 A.D.3d 600, 42 N.Y.S.3d 790 (1st Dep’t 2016) (“Defendants based this motion on the fact that plaintiffs’ former lead counsel, who was scheduled to be a fact witness, had retired from law firm practice and become a Justice of the Supreme Court, Commercial Division. . . . Here, defendants’ arguments consist not of factual evidence, but of conclusory allegations, beliefs, suspicions, and the repeated invocation of the phrase ‘appearance of impropriety.’ The evidence in the record demonstrates that the motion court providently exercised its discretion in denying defendants’ motion. There is no personal relationship between the trial judge and the judge-witness and no personal relationship between

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the judge-witness and the party (citation omitted). The mere fact that the jury may discover a nonparty witness is a judge is not enough to prejudice a defendant where a plaintiff does not seek to exploit the witness’s status to enhance his credibility (citations omitted). Moreover, the same concerns would exist, no matter in what venue the case is tried.”).

CPLR 510(3) / 511 - Failure to show witness inconvenience

Ambroise v. United Parcel Serv. of Am., Inc., 143 A.D.3d 927, 39 N.Y.S.3d 255 (2d Dep’t 2016) (“Here, the defendants failed to set forth any of the facts to which the prospective witnesses would testify at trial, or to describe how their testimony would be necessary or material. Furthermore, the defendants made only conclusory statements that the prospective witnesses would be inconvenienced, and failed to establish the manner or extent to which those witnesses would be inconvenienced (citations omitted). The mere fact that the witnesses would be required to travel a significant distance does not establish, without more, that requiring their testimony would impose an undue burden on them (citations omitted).”).

CPLR 510(3) / 511 - Adequate showing that police officers’ testimony would be material and officers would be burdened by travel

Schwartz v. Walter, 141 A.D.3d 641, 37 N.Y.S.3d 272 (2d Dep’t 2016) (“Here, the appellant established that all of the identified nonparty witnesses reside in or near Rockland County. The two nonparty eyewitnesses who made statements to Ramapo Police Department officers concerning their observations of the accident reside in Rockland County (citation omitted). The seven police officers who responded to the scene of the accident reside either in Rockland County or in Orange County. The police reports prepared by the Town of Ramapo Police Department officers with respect to the accident demonstrate that the testimony of the officers would be material to the trial of this action (citation omitted). Further, it would be a burden for the police officers to be required to travel from Rockland County to Kings County during their normal business hours for depositions and trial (citations omitted).”).

CPLR 510(3) / 511- Motion to change venue granted; it was proper for the trial court to consider police officers’ convenience, because their testimony regarding their investigation as to how the accident happened bears on liability

Kochan v. Target Corp., 161 A.D.3d 499 (1st Dep’t 2018) (“Supreme Court did not improvidently exercise its discretion in granting Target’s motion to change venue to Suffolk County even though plaintiff properly placed venue in New York County based upon Target’s principal place of business at the time the action was commenced (citation omitted). The motor vehicle accident happened in Suffolk County, plaintiffs and codefendants live in that county, the decedent received her medical treatment there (citation omitted). Target also submitted the affidavits of two Suffolk County police officers, who averred that they were involved in the investigation including interviewing witnesses at the accident location and that they would be inconvenienced by having to travel to New York County because it would cause them to be absent from their police duties for a full day (citation omitted). That the police officers signed affidavits in favor of the motion to change venue establishes that they were aware of the action and demonstrates that they are willing

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. to testify at trial. It was proper for the motion court to consider the police officers’ convenience, because their testimony regarding their investigation as to how the accident happened bears on liability (citation omitted). Furthermore, the police officers’ affidavits are not insufficient because they do not set forth their home addresses, since it is undisputed that they work in Suffolk County (citations omitted).”).

CPLR 510(3) / 511- Motion denied; insufficient showing on convenience of witnesses

Gorodetsky v. Bridgewater Wholesalers, Inc., 161 A.D.3d 722 (2d Dep’t 2018) (“Here, the defendants failed to disclose the addresses of all but one of the prospective witnesses, made only conclusory statements that the prospective witnesses would be inconvenienced, and failed to establish the manner or extent to which those witnesses would be inconvenienced (citations omitted). With regard to those witnesses who were New York State police officers, while ‘the convenience of local government officials, such as police officers, is of paramount importance because they should not be kept from their duties unnecessarily’ (citation omitted), here, only conclusory statements, without any details, were provided as to how those witnesses would be inconvenienced. As such, these statements were insufficient to establish that those witnesses would be inconvenienced if venue were not changed. Accordingly, the Supreme Court providently exercised its discretion in denying the defendants’ motion for a change of venue from Richmond County to Warren County.”).

CPLR 510(3) / 2212 - Venue on discretionary motion placed “in the county in which the action is pending, or in any county in that judicial district, or in any adjoining county”; after implementation of IAS system, latter choices (other than where action pending) generally unavailable

Fensterman v. Joseph, 2018 NY Slip Op 04532 (2d Dep’t 2018) (“It is undisputed that, pursuant to CPLR 503(a), venue of the Ulster County Action is properly in Ulster County, where Bacci, one of the Ulster plaintiffs, resided at the time the action was commenced (citation omitted). A motion to change venue on discretionary grounds, unlike motions made as of right, must be made in the county in which the action is pending, or in any county in that judicial district, or in any adjoining county (citations omitted). The Fenstermen parties, therefore, were required to make a motion pursuant to CPLR 510(3) either in Ulster County, where the Ulster County Action was pending, in another county in the 3rd Judicial District, or in a county contiguous to Ulster County (citations omitted). Since Ulster County and Nassau County are not contiguous, and Nassau County is not in the 3rd Judicial District, the Fensterman parties' motion to change venue pursuant to CPLR 510(3) based on discretionary grounds was improperly made in the Supreme Court, Nassau County (citations omitted). Although not argued by the parties in the Supreme Court, Nassau County, but argued on appeal, we reach this issue in the exercise of our discretion because it appears on the face of the record and could not have been avoided or explained if raised in the Supreme Court (citations omitted).”).

CPLR 511 - Where demand e-filed, election to serve via U.S. mail does not extend time to bring motion to change venue

Woodward v. Millbrook Ventures LLC, 148 A.D.3d 658, 49 N.Y.S.3d 303 (1st Dep’t 2017) (“Supreme Court properly concluded that defendants’ motion was untimely. Having consented to electronic filing, defendants were required to serve their papers electronically (Uniform Rules for Trial Cts [22 NYCRR] § 202.5-b[d][1]), and indeed served their demand for change of venue, together with their answer, by e-filing the documents on July 14, 2015 (22 NYCRR 202.5- b[f][2][ii]). Having served their demand, defendants were required to bring their motion to change venue within 15 days, or by July 29, 2015 (CPLR 511). However, defendants did not bring their motion until July 31, 2015, rendering it untimely. That defendants also elected to serve their demand via United States mail did not extend the deadline for their motion under CPLR 2103(b)(2). Because they consented to participate in Supreme Court’s e-filing system, defendants were bound by the applicable rules governing service.”).

CPLR 511 - Where defendant fails to serve timely demand, court can still exercise discretion to change venue

Fish v. Davis, 146 A.D.3d 485, 45 N.Y.S.3d 46 (1st Dep’t 2017) (“The motion court properly noted that defendants failed to comply with the procedural requirements of CPLR 511 by moving to change venue four months after serving an answer that did not request a change of venue (citations omitted). When a defendant fails to make a demand to change venue, the court may still exercise its discretion to change venue, but ‘only in certain limited situations,’ such as when the defendant seeks to enforce a contract provision or when ‘judicial policy dictates that a case be heard only in a proper county’ (citation omitted).”).

ARTICLE 9 – CLASS ACTIONS

CPLR 908 – Dismissal, discontinuance or compromise

David L. Ferstendig, Divided Court of Appeals Holds That CPLR 908 Applies to Pre-Certified Class Actions, 687 N.Y.S.L.D. 1 (2018)

Divided Court of Appeals Holds That CPLR 908 Applies to Pre-Certified Class Actions

Thus, Court Approval and Notice to Putative Class Members of Proposed Dismissal, Discontinuance or Compromise Is Required

CPLR 908 requires court approval before a class action is dismissed, discontinued or compromised. In addition, it provides that "[n]otice of the proposed dismissal, discontinuance, or compromise shall be given to all members of the class in such manner as the court directs." The question presented in Desrosiers v. Perry Ellis Menswear, LLC., 2017 N.Y. Slip Op. 08620 (December 12, 2017), was whether CPLR 908 only applies to certified class actions or if it also

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. applies to class actions settled or dismissed before the class is certified. A split Court of Appeals held that CPLR 908 applies to pre-certified actions.

The majority noted that CPLR 908 is ambiguous as to whether a "class action" means only a certified class or could include an action from the moment the complaint containing class action allegations is filed. Furthermore, the fact that the statute required that notice be provided to "all members of the class" is "inconclusive" because it is not clear whether there are "class members" before a class is certified.

The majority then looked at other principles of statutory interpretation and sources beyond the text. CPLR Article 9 was modeled on a similar federal law. The majority of federal circuit courts interpreting the relevant (earlier) version of FRCP 23(e), which was virtually identical to CPLR 908, concluded that it applied to pre-certified actions, but that the notice was discretionary. Moreover, the only New York State appellate case dealing with the issue (prior to this case)— Avena v. Ford Motor Co., 85 A.D.2d 149 (1st Dep’t 1982)—concluded that CPLR 908 applied to settlements before certification. The Court of Appeals never overruled Avena, and no other Appellate Division department has reached a contrary conclusion. The majority ascribed persuasive significance to legislative inaction, that is, the fact that the legislature has not amended CPLR 908 in the decades since Avena has been decided is particularly persuasive evidence that the court correctly interpreted the legislature’s intent as it existed when CPLR 908 was enacted in light of developments occurring in the years after Avena was decided.

Derosiers, 2017 N.Y. Slip Op. 08620 at ∗6.

FRCP 23(e) was amended in 2003 to make notice required only for certified classes, and proposals to amend CPLR 908 to provide for discretionary pre-certification notice where necessary to protect putative class members (as opposed to the mandatory requirement enunciated in Avena) have never been adopted or acted upon by the State Legislature. The majority concluded that the practical difficulties and policy concerns arising out of this issue should be addressed by the legislature, especially considering that there are also policy reasons in favor of applying CPLR 908 in the precertification context, such as ensuring that the settlement between the named plaintiff and the defendant is free from collusion and that absent putative class members will not be prejudiced. The balancing of these concerns is for the legislature, not this Court, to resolve (citations omitted).

Id. at ∗7–8.

The dissent, written by Judge Stein, asserted that the majority found there to be ambiguity in CPLR 908 where there was none and placed too much weight on the First Department’s decision in Avena. CPLR 908 requires notice in a "class action" and here plaintiffs did not "transform the purported class action into an actual class action." Moreover, prior to class certification, there are no "members of the class" to whom notice could be provided; a court, "not a would-be class

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. representative, has the power to determine whether an action ‘brought as a class action’ may be maintained as such"; and notice to putative class members here would lack practical significance, because "the notice would essentially inform putative class members that an individual claim— of which they received no prior notice—was being resolved by an agreement that was not binding on them." Id. at ∗11.

The dissent concluded that the appellate courts’ and legislature’s inactions after Avena, a decision characterized by the dissent as flawed and questioned by many, should not impact "our adherence to the statutory text." Finally, federal case law interpreting the pre-2003 version of FRCP 23(e) held that notice in pre-certified cases was discretionary. They did not address the issue here: that is, whether the notice is mandatory.

ARTICLE 10 - PARTIES GENERALLY

CPLR 1003 - Service outside time to add parties as of right

Jaramillo v. Asconcio, 151 A.D.3d 947, 58 N.Y.S.3d 412 (2d Dep’t 2017) (“Here, the plaintiff served and filed the supplemental summons and amended complaint outside of the time periods specified in CPLR 1003, and before obtaining leave of court or a stipulation of the parties who had appeared in the action. Since the plaintiff failed to obtain leave of court or a stipulation between the parties before serving and filing the supplemental summons and amended complaint, that service may be deemed a nullity, and the amended complaint dismissed insofar as asserted against the additional parties for lack of personal jurisdiction (citations omitted). However, lack of personal jurisdiction may be waived (citations omitted). Under the circumstances of this case, by his appearance in June 2012 and his voluntary participation in the action, Dariusz Lojek submitted to the jurisdiction of the court and waived any defense of lack of personal jurisdiction within the applicable statute of limitations (citations omitted).”).

CPLR 1024 - Provision permitting commencement of action against unknown parties does not toll the statute of limitations

Walker v. Hormann Flexon, LLC, 153 A.D.3d 997, 59 N.Y.S.3d 614 (3d Dep’t 2017) (“The statutory provision allowing commencement of an action against unknown parties does not toll the statute of limitations (citations omitted). As Supreme Court held, plaintiff was required to serve all parties within 120 days of filing, or seek leave to extend the time for service ‘upon good cause shown or in the interest of justice’ (citations omitted). Here, plaintiff failed to seek leave to extend the time for service prior to expiration of the statutory limitations period. Further, a party seeking to apply the relation-back doctrine under CPLR 1024 carries the burden ‘of establishing that diligent efforts were made to ascertain the unknown party’s identity prior to the expiration of the statute of limitations” (citations omitted).”).

ARTICLE 14- A – CONTRIBUTORY NEGLIGENCE

CPLR 1412 - Burden of proof

CPLR 1412 / 3212

David L. Ferstendig, Majority of Court of Appeals Holds Plaintiffs Need Not Establish the Absence of Their Own Comparative Negligence to Obtain Partial Summary Judgement on Liability Only, 690 N.Y.S.L.D. 1-2 (2018)

Majority of Court of Appeals Holds Plaintiffs Need Not Establish the Absence of Their Own Comparative Negligence to Obtain Partial Summary Judgement on Liability Only

Court Resolves Conflict and Confusion in This Area

In the November 2016 Edition of the Digest, we discussed the confusion within the First Department as to whether a plaintiff must establish that he or she is free from comparative negligence in order to be successful on a partial summary judgment motion on liability only. In Rodriguez v. City of New York, 142 A.D.3d 778 (1st Dep’t 2016), a First Department panel joined the Second Department in finding that the plaintiff had such an obligation.

Recently, on appeal, a narrow majority of the Court of Appeals reversed. Rodriguez v. City of New York, 2018 N.Y. Slip Op. 02287 (April 3, 2018). The Court noted that placing such a burden on the plaintiff is inconsistent with CPLR Article 14-A, which codified comparative negligence principles. CPLR 1412 provides that "[c]ulpable conduct claimed in diminution of damages, in accordance with [CPLR 1411], shall be an affirmative defense to be pleaded and proved by the party asserting the defense." Thus, the majority insisted that requiring the plaintiff to prove the absence of comparative fault here would "flip" the burden.

The defendant argued that CPLR 3212(b), which requires that a summary judgment motion establish that "there is no defense to the cause of action," supported its position. The majority rejected this argument because comparative negligence "is not a defense to any element (duty, breach, causation) of plaintiff’s prima facie cause of action for negligence," and, as noted above, does not bar plaintiff’s recovery, but only serves to reduce the damages. Id. at ∗4.

The majority maintained that the legislative history of CPLR Article 14-A supported its approach. Moreover, it also addressed the elephant in the room, that is, the Court of Appeals’ prior decision in Thoma v. Ronai, 82 N.Y.2d 736 (1993), where, in upholding the First Department’s order, the Court stated that:

The submissions to the nisi prius court on plaintiff’s motion for summary judgment, consisting of her affidavit and the police accident report, demonstrate that she may have been negligent in failing to look to her left while crossing the intersection. Plaintiff’s concession that she did not observe the vehicle that struck her raises a

factual question of her reasonable care. Accordingly, plaintiff did not satisfy her burden of demonstrating the absence of any material issue of fact and the lower courts correctly denied summary judgment.

Thoma, 82 N.Y.2d at 737.

The majority in Rodriguez insisted that, notwithstanding the language in the Thoma case and reliance by numerous appellate courts on it, Thoma never addressed the precise question here (that is, whether the plaintiff bears the burden to show the absence of comparative negligence) or considered the impact of Article 14-A.

Finally, the majority rejected defendant’s contention that granting plaintiff’s motion would serve no practical purpose:

A principal rationale of partial summary judgment is to narrow the number of issues presented to the jury. In a typical comparative negligence trial, the jury is asked to answer five questions: 1. Was the defendant negligent? 2. Was defendant’s negligence a substantial factor in causing [the injury or the accident]? 3. Was plaintiff negligent? 4. Was plaintiff’s negligence a substantial factor in causing (his or her) own injuries? 5. What was the percentage of fault of the defendant and what was the percentage of fault of the plaintiff? (PJI 2:36). Where plaintiff has already established defendant’s liability as a matter of law, granting plaintiff partial judgment eliminates the first two questions submitted to the jury, thereby serving the beneficial purpose of focusing the jury on questions and issues that are in dispute (citations omitted).

Rodriguez, 2018 N.Y. Slip Op. 02287 at ∗6.

The dissent rejected the majority’s position that the Court’s decision in Thoma did not settle the issue here, and, in fact, it maintained that subsequent Court of Appeals’ decisions followed the "Thoma rule."

In addition, the dissent noted that, for the most part, the Appellate Division Departments have held that a plaintiff cannot obtain partial summary judgment where there are issues of fact concerning comparative fault. Moreover, there have been failed legislative proposals to place the burden on a defendant opposing a summary judgment motion to produce evidence of plaintiff’s comparative fault to raise issues of fact. Thus, such attempts to amend the statute "would be unnecessary if plaintiffs were entitled to summary judgment despite the existence of issues of fact concerning comparative fault." Id. at ∗8. In addition, the dissent insisted that the "Thoma rule" is a "fairer outcome"; determinations of the degree of fault should be made as a whole; assessing one party’s

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. fault with a preconceived idea of the other party’s liability is inherently unfair; the Pattern Jury Instructions advise that a jury is to consider both parties’ liability together; and the issue of the defendant’s liability and comparative fault are intertwined.

Regardless of whether you agree or disagree with the Court of Appeals’ ruling, its benefits are manifest in finally resolving this issue and avoiding confusing intra and inter Appellate Division Department conflicts. Yet another conflict resolved!

CPLR 1412 / 3212 - But the issue of a plaintiff's comparative negligence can be decided in the context of a summary judgment motion where, as here, the plaintiff moved for summary judgment dismissing a defendant's affirmative defense of comparative negligence

Poon v. Nisanov, 2018 NY Slip Op 04365 (2d Dep’t 2018) (“Although a plaintiff need not demonstrate the absence of his or her own comparative negligence to be entitled to partial summary judgment as to a defendant's liability (citation omitted), the issue of a plaintiff's comparative negligence may be decided in the context of a summary judgment motion where, as here, the plaintiff moved for summary judgment dismissing a defendant's affirmative defense of comparative negligence (citation omitted).”).

ARTICLE 20- MISTAKES, DEFECTS, IRREGULARITIES AND EXTENSIONS OF TIME

CPLR 2001 - Untimeliness of the proper service overlooked

Capolino v. Goren, 155 A.D.3d 1414, 65 N.Y.S.3d 272 (3d Dep’t 2017) (“Due to the inapplicability of those contractual provisions, plaintiffs’ effort to serve defendant by mail was deficient in that service ‘under CPLR 3213 is subject to the rules governing service of the summons generally’ (citations omitted). The mailing nevertheless placed defendant on notice of the pending motion for summary judgment in lieu of complaint, and she responded with a cross motion that opposed the motion on various grounds. Plaintiffs then arranged for proper, albeit untimely, service of defendant pursuant to CPLR 308 (2), and advised that they were amenable to any further adjournment of the return date ‘as defendant and [Supreme] Court may find proper.’ Accordingly, while a wholesale failure to timely serve defendant with the initiatory papers constitutes ‘a fatal jurisdictional defect’ (citations omitted), defendant was placed on notice, then submitted a cross motion that raised various objections and included substantive opposition before being properly served. In light of these peculiar circumstances, as well as the absence of any prejudice flowing from plaintiffs’ missteps, we are persuaded that the untimeliness of the proper service could be and rightly was overlooked (citations omitted).”).

CPLR 2001 - Disregard a mistake in indexing a notice of pendency

Beltway Capital, LLC v. Gutierrez, 140 A.D.3d 998, 35 N.Y.S.3d 164 (2d Dep’t 2016) (“The Supreme Court erred in denying the plaintiff’s motion pursuant to CPLR 2001 (citation omitted).

‘CPLR 2001 permits a court, at any stage of an action, to disregard a party’s mistake, omission, defect, or irregularity if a substantial right of a party is not prejudiced’ (citations omitted). Prejudice can be considered in determining whether a mistake in indexing a notice of pendency can be disregarded under CPLR 2001 (citation omitted). Here, however, given the respondents’ actual knowledge of the notice of pendency and the foreclosure proceeding, they cannot claim that they would be prejudiced by disregarding the omission of lot 123 from the description of the property on the documents (citations omitted). Accordingly, the Supreme Court should have granted the plaintiff’s motion to amend the notice of pendency, judgment of foreclosure and sale, and all other documents in the action, nunc pro tunc, to correct the legal description of the foreclosed property.”).

CPLR 2001 - Unsigned deposition admissible

Gallway v. Muintir, LLC, 142 A.D.3d 948, 38 N.Y.S.3d 28 (2d Dep’t 2016) (“The plaintiff’s challenges to the admissibility of the defendants’ evidence are without merit. The plaintiff’s unsigned deposition was admissible, since it was submitted by the plaintiff herself in opposition to the defendant’s motion, thus acknowledging its accuracy (citation omitted). Additionally, the defendants cured any defects in the admissibility of the deposition transcripts submitted in support of their motion by submitting, in reply, the reporter’s certification of those transcripts and the fact that the depositions were forwarded to the parties for review and signature (citations omitted).”).

CPLR 2001 - Substituting, nunc pro tunc, the newly signed affidavit of merit in place of the affidavit of merit that had been attached to its application for an order of reference

US Bank, N.A. v. Steele, 142 A.D.3d 1161, 39 N.Y.S.3d 178 (2d Dep’t 2016) (“The Supreme Court providently exercised its discretion in granting those branches of the plaintiff’s motion which were to substitute, nunc pro tunc, the newly signed affidavit of merit in place of the affidavit of merit that had been attached to its application for an order of reference, and to validate the order of reference. CPLR 2001 ‘permits a court, at any stage of an action, to disregard a party’s mistake, omission, defect, or irregularity if a substantial right of a party is not prejudiced’ (citations omitted). In addition, pursuant to CPLR 5019(a), a court has ‘discretion to correct an order or judgment which contains a mistake, defect, or irregularity not affecting a substantial right of a party’ (citation omitted). Here no substantial right of the defendant has been affected by the court’s substitution of the new affidavit of merit ((citations omitted).”).

CPLR 2001 - Disregarding a failure to comply with RPAPL 1301(3) by commencing a new action without court leave before the discontinuance of an earlier action

Wells Fargo Bank, N.A. v. Irizarry, 142 A.D.3d 610, 36 N.Y.S.3d 689 (2d Dep’t 2016) (“Here, the plaintiff violated RPAPL 1301(3) by, without leave of the Supreme Court, commencing the 2013 action prior to the court granting its motion to discontinue the 2008 action. However, by the time the defendant moved to dismiss the complaint in the 2013 action based upon the plaintiff’s violation of RPAPL 1301(3), the court had already granted the plaintiff’s motion to discontinue the 2008 action. Under the unique circumstances of this case, where the defendant was not prejudiced by the plaintiff’s failure to comply with RPAPL 1301(3) since he was not in the position

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. of having to defend against more than one lawsuit to recover the same mortgage debt, granting dismissal of the complaint in the 2013 action after the 2008 action had already been discontinued afforded the defendant more relief than is contemplated by RPAPL 1301(3). The plaintiff’s failure to comply with RPAPL 1301(3) should have been disregarded as a mere irregularity which did not prejudice a substantial right of any party (see CPLR 2001), and that branch of the defendant’s motion which was pursuant to RPAPL 1301(3) to dismiss the complaint insofar as asserted against him should have been denied.”).

CPLR 2001 - Correct a judgment

Rosenblum v. Rosenblum, 145 A.D.3d 460, 43 N.Y.S.3d 36 (1st Dep’t 2016) (“The court had the authority to correct the judgment to reflect the reduced ad damnum clause of the complaint because the change did not prejudice defendant or affect a substantial right (see CPLR 2001).”).

CPLR 2001 - Disregarding an error in a slight variance between the caption appearing on the defendant’s motion papers and the summons and complaint filed

Ambroise v. United Parcel Serv. of Am., Inc., 143 A.D.3d 929, 40 N.Y.S.3d 444 (2d Dep’t 2016) (“The Supreme Court erred in denying the defendants’ motion solely upon a procedural ground that the parties did not raise or litigate (citations omitted). Although there was a slight variation between the caption appearing on the defendants’ moving papers and the summons and complaint filed by the plaintiffs, this defect in form should have been disregarded since it did not prejudice the substantial rights of any party, and the plaintiffs failed to raise a timely objection to it (citations omitted). Accordingly, the Supreme Court should have determined the motion on the merits (citations omitted). In the interest of judicial economy, we deem it appropriate to address the motion on the merits, rather than remit the matter of the Supreme Court, Queens County, to do so (citation omitted).”).

CPLR 2001 - Considered out of state affidavit subscribed and sworn to out of state and not accompanied by a certificate of conformity

Bank of New York Mellon v. Sakadawen Vytalingam, 144 A.D.3d 1070, 42 N.Y.S.3d 274 (2d Dep’t 2016) (“The Supreme Court should have considered the affidavit of the plaintiff’s loan servicer notwithstanding that it was subscribed and sworn to out of state and not accompanied by a certificate of conformity as required by CPLR 2309(c), as such a defect is not fatal, and no substantial right of the defendants was prejudiced by disregarding the defect (citations omitted). As the defendants failed to oppose the plaintiff’s motion or raise the issue, it was inappropriate for the Supreme Court to, sua sponte, do so on their behalf (citations omitted).”).

American Cas. Co. of Reading, Pa. v. Motivated Sec. Servs., Inc., 148 A.D.3d 521, 48 N.Y.S.3d 591 (1st Dep’t 2017) (“The motion court properly considered the out-of-state affidavit of SBF’s president, even though it lacks a certificate of conformity (CPLR 2309[c]). The lack of such certification is not a fatal defect and the irregularity may be corrected later (citations omitted).”).

CPLR 2001 - But where plaintiff’s affidavit of purported service lacked certificate of conformity, trial court finds defect is not excusable under CPLR 2001

JPMorgan Chase Bank, N.A. v. Diaz, 56 Misc. 3d 1136, 57 N.Y.S.3d 358 (Sup. Ct. Suffolk Co. 2017) (“Generally, although a defective out-of-state affidavit, which is defective because it is not accompanied by a certificate of conformity, may be waived or cured under CPLR §2001, such defect waiver or cure may occur only after jurisdiction has been established (citations omitted). Indeed, personal jurisdiction over a defendant is not obtained until service is properly effected, and while correction of mistakes, omissions, defects or irregularities is generally permitted under CPLR §2001, irregularities or defects related to personal jurisdiction are not among those that are correctable (citations omitted)….. Accordingly, the legislative intent of CPLR §2001 was to excuse non-prejudicial defects in court filings, not defects pertaining to jurisdiction. Here, the affidavit at issue is plaintiff’s affidavit of purported service. Therefore, contrary to plaintiff’s contentions, CPLR §2001 is not curative of plaintiff’s failure to comply with CPLR §2309(c). If an out-of-state affidavit of service is defective for failure to comply with the certificate of conformity requirements of CPLR §2309(c), such defect may be waived or cured only by a subsequent affidavit that corrects such defect (citations omitted). Since the plaintiff has again failed to submit a certificate of compliance with the out-of-state affidavit of service as required by CPLR §2309(c), and has failed to submit an affidavit curing such defect, jurisdiction over the defendant has not been properly established. Based upon the foregoing, the plaintiff’s motion for a default order of reference is denied. Plaintiff is afforded one final opportunity to establish proper jurisdiction and compliance with the requirements of CPLR §2309(c) regarding plaintiff’s out-of- state affidavit of purported service. Failure to do so shall result in dismissal plaintiff’s complaint.”). But see Federal Natl. Mtge. Assn. v Chiusano, 2018 N.Y. Misc. LEXIS 1646, 2018 NY Slip Op 28143 (Sup. Ct. Sufolk Co. 2018).

CPLR 2001 - Disregarded failure to attach an admission of service to the motion papers, and the failure to file proof of service of the petition and notice of petition

Gonzalez v. Haniff, 144 A.D.3d 1087, 43 N.Y.S.3d 375 (2d Dep’t 2016) (“Here, the Haniffs served the order to show cause and supporting papers in accordance with the directives set forth in the order to show cause. Thus, the Supreme Court had jurisdiction to entertain the motion. Moreover, the Haniffs properly filed the admission of service with the Clerk of Queens County (see CPLR 2102[a]). Although the admission of service was not annexed to the motion papers, the plaintiffs submitted opposition to the motion on the merits without raising any failure of proper service or irregularity in the Haniffs’ submissions to the court. Under these circumstances, given that no substantial right of the plaintiffs was prejudiced, the court should have disregarded the alleged irregularity and determined the motion on the merits (citations omitted).”).

Matter of Meighan, 144 A.D.3d 917, 42 N.Y.S.3d 182 (2d Dep’t 2016) Three Amigos SJL Rest., Inc. v 250 W. 43 Owner LLC, 144 A.D.3d 490, 41 N.Y.S.3d 224 (1st Dep’t 2016) (“Here, there is no dispute that the respondents were served with the notice of petition and petition, as they moved to dismiss on the ground that the petition failed to state a cause of action. At no time did they argue that the proceeding should be dismissed for failure to file proof of service. As such, the parties did not have an opportunity to address the purported failure to file proof of service, the ground upon

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. which the Supreme Court relied in denying the petition and dismissing the proceeding, even though such defect is readily curable (see CPLR 2001, 2004). ‘The lack of notice and opportunity to be heard implicates the fundamental issue of fairness that is the cornerstone of due process’ (citation omitted). Therefore, the Supreme Court should have alerted the parties to the purported defect and afforded the appellant an opportunity to correct it, rather than denying the petition and dismissing the proceeding (citation omitted).”).

CPLR 2001 - Disregarding an error made in moving against the amended complaint (declared a nullity by the court) instead of the original complaint

Mew Equity, LLC v. Sutton Land Servs., LLC, 144 A.D.3d 874, 42 N.Y.S.3d 175 (2d Dep’t 2016).

CPLR 2001 - Deem a notice of appeal filed by a prior landlord to be the notice of appeal by the current landlords

Three Amigos SJL Rest., Inc. v. 250 W. 43 Owner LLC, 144 A.D.3d 490, 41 N.Y.S.3d 224 (1st Dep’t 2016) (“Although the current landlord defendants were not parties to the action at the time of issuance of the order on appeal or at the time the former landlord filed the notice of appeal, we, sua sponte, deem the notice of appeal dated October 19, 2015 to be a notice of appeal by the current landlords (citation omitted). The current landlords are ‘aggrieved part[ies]’ within the meaning of CPLR 5511, and therefore have standing to appeal.”).

CPLR 2001 - Correct a judgment to reflect the reduced ad damnum clause of the complaint

Rosenbaum v. Rosenbaum, 145 A.D.3d 460, 43 N.Y.S.3d 36 (1st Dep’t 2016) (“The court had the authority to correct the judgment to reflect the reduced ad damnum clause of the complaint because the change did not prejudice defendant or affect a substantial right (see CPLR 2001).”).

CPLR 2001 - Correct a name in the caption

Bessa v. Anflo Indus., Inc., 148 A.D.3d 974, 51 N.Y.S.3d 102 (2d Dep’t 2017) (to permit amendment of caption and pleadings to reflect plaintiff’s correct legal name. “Although dismissal of the complaint was not warranted, the Supreme Court nevertheless should have taken steps to ensure that the caption and the pleadings in this action were amended to reflect the plaintiff’s correct name. ‘[W]here the right party plaintiff is in court but under a defective name or title as party plaintiff . . . an amendment correcting the title is permissible’ (citations omitted). Indeed, ‘CPLR 2001 permits a court, at any stage of an action, to disregard a party’s mistake, omission, defect, or irregularity if a substantial right of a party is not prejudiced’ (citation omitted), and CPLR 5019(a) gives trial and appellate courts the discretion to cure mistakes, defects, and irregularities that do not affect substantial rights of parties (citations omitted). Inasmuch as the appellants failed to demonstrate that they would suffer any prejudice if the plaintiff’s name is

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. corrected, the court should have directed the amendment of the caption and the pleadings to reflect the plaintiff’s correct legal name (citations omitted).”).

US Bank N.A. v. Konstantinovic, 147 A.D.3d 1002, 48 N.Y.S.3d 182 (2d Dep’t 2017) (“Contrary to the defendant’s contention, the Supreme Court providently exercised its discretion by permitting the correction of the name of the plaintiff in the caption since the correction did not affect a substantial right of the defendant (citations omitted). Moreover, the defendant waived her objection to the plaintiff’s standing by failing to raise the objection in an answer or in a pre-answer motion to dismiss the complaint (citations omitted). Contrary to the defendant’s further contention, the plaintiff’s motion was not made pursuant to CPLR 3025(b), and therefore, the corrections to the caption made pursuant to CPLR 2001 did not provide her an opportunity to serve an answer to an amended complaint (cf. CPLR 3025[d]).”).

CPLR 2001 - Disregarding the plaintiff’s mistake in labeling his bill of particulars as a ‘supplemental’ bill

Mackauer v. Parikh, 148 A.D.3d 873, 49 N.Y.S.3d 488 (2d Dep’t 2017) (“Contrary to the defendants’ contention, the plaintiff’s ‘supplemental’ bill of particulars adequately set forth the plaintiff’s theory that the defendants negligently failed to diagnose him with appendicitis. Although the bill of particulars was denominated as a ‘supplemental’ bill of particulars, which may not be used to articulate a new theory of liability (citaions omitted), the plaintiff was entitled to ‘amend’ his bill of particulars once as of right at any time prior to filing the note of issue (citations omitted). We may disregard the plaintiff’s mistake in labeling his bill of particulars as a ‘supplemental’ bill where, as here, a substantial right of a party will not be prejudiced (citations omitted). The supplemental bill of particulars was filed approximately 54 days before the defendants moved, inter alia, for summary judgment and, notably, the defendants’ expert addressed the plaintiff’s failure-to-diagnose theory when he opined that the plaintiff ‘did not exhibit any signs or symptoms of appendicitis on April 21, 2009.’ Moreover, the defendants did not reject the supplemental bill of particulars when it was served upon them, and have not claimed that they would be prejudiced by treating it as an amended bill of particulars.”).

CPLR 2001 - Disregarding the delay in filing a request for judicial intervention

HSBC Bank USA, N.A. v. Corazzini, 148 A.D.3d 1314, 49 N.Y.S.3d 202 (3d Dep’t 2017) (“Defendant also claimed that she was entitled to summary judgment due to plaintiff’s failure to file a request for judicial intervention with the county clerk at the time that it filed proof of service of the summons and complaint in February 2009. The filing of the request for judicial intervention might have obliged Supreme Court to ‘hold a mandatory [residential mortgage foreclosure] conference within [60] days’ (CPLR former 3408 [a], as added by L 2008, ch 472, § 3; see 22 NYCRR former 202.12a [b]), although it is unclear whether this case involves the type of home loan to which the then-extant version of CPLR 3408 applied (citation omitted). It is also worthy of note that a conference at that time would have been of questionable value, as the version of CPLR 3408 then in effect did not require that the parties negotiate in good faith (see CPLR 3408 [f], as added by L 2009, ch 507, § 9). In any case, defendant did not describe any negotiations that were hampered by the lack of a timely settlement conference and, in fact, she failed to attend the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. conference when it finally occurred. The delay in filing a request for judicial intervention was nothing more than a nonprejudicial procedural error under these circumstances and, as such, it “shall be disregarded” (CPLR 2001).”).

CPLR 2001 - Disregarding an error in identifying the proper order of support in a petition

Matter of Nimkoff v. Nimkoff, 147 A.D.3d 850, 47 N.Y.S.3d 349 (2d Dep’t 2017) (“Although the father, in his petition, mistakenly referred to the October 3, 2013, order as the final order of child support, rather than the judgment of divorce, the judgment of divorce incorporating the prior order was before the Support Magistrate, and it was clear that the father sought downward modification of the support obligation imposed in the judgment of divorce—an application the Family Court had the subject matter jurisdiction to determine (citations omitted). The mother moved to dismiss the petition on the merits, and was not prejudiced by the father’s mistake in identifying the proper final order of support. Since no substantial right of the mother was prejudiced by the father’s error, the mistake should have been disregarded and the petition and motion to dismiss the petition entertained on their merits (citations omitted). Accordingly, the Family Court should have granted the father’s objections, vacated the Support Magistrate’s order, and remitted the matter to the Support Magistrate to determine the mother’s motion to dismiss on the merits (citation omitted).”).

CPLR 2001 - Treat an appeal as also being taken by the claimant, even though the notice of appeal was filed on behalf of his attorney only

Matter of Tenecela v. Vrapo Constr., 146 A.D.3d 1217, footnote 1, 45 N.Y.S.3d 678 (3d Dep’t 2017) (“Given that the issues raised on appeal concern both claimant and his attorney, the notice of appeal should have also been filed on behalf of claimant and not solely on behalf of his attorney (citations omitted). The parties do not address this issue and, in the absence of any alleged prejudice, we will disregard the error and treat the appeal as also taken by claimant (see CPLR 2001).”).

CPLR 2001 - Disregard failure to attach pleadings on summary judgment motion

Wade v. Knight Transp., Inc., 151 A.D.3d 1107, 58 N.Y.S.3d 458 (2d Dep’t 2017) (“We also disagree with the contention of Wade and the infant plaintiff that the Supreme Court should have denied the Knight defendants’ motions for summary judgment on the ground that they failed to submit copies of certain pleadings concerning the defendant Daniel Freudenberg with their motion papers. Freudenberg was a witness to the accident and was made a defendant in these actions after giving deposition testimony that revealed that his actions may have contributed to the accident. Notwithstanding that CPLR 3212(b) requires that motions for summary judgment be supported by a copy of the pleadings, CPLR 2001 permits a court, at any stage of an action, to ‘disregard a party’s mistake, omission, defect, or irregularity if a substantial right of a party is not prejudiced’ (citations omitted). The record here is sufficiently complete, Freudenberg was not a party to the instant motions, and Wade and the infant plaintiff do not argue that they were prejudiced in any way by the Knight defendants’ failure to include those pleadings (citations omitted).”).

CPLR 2001 - Improperly serving party, rather than counsel, not excusable under CPLR 2001

Deutsche Bank Natl. Trust Co. v. Lamontanaro, 150 A.D.3d 680, 53 N.Y.S.3d 685 (2d Dep’t 2017) (“The Supreme Court properly granted that branch of Lamontanaro’s motion which was to strike Jack Anthony’s cross claims insofar as asserted against him. Jack Anthony attempted to serve its answer, including its cross claims, upon Lamontanaro at his residence. However, since Lamontanaro was represented by counsel during the relevant time period, Jack Anthony’s answer was required to have been served upon Lamontanaro’s attorney pursuant to CPLR 2103(b) (citation omitted). Furthermore, Jack Anthony’s answer was untimely (citation omitted). Contrary to Jack Anthony’s contention, under the circumstances of this case, the court providently exercised its discretion in declining to disregard the above-mentioned defects pursuant to CPLR 2001 (citation omitted).”).

CPLR 2001 - Failure to file proof of service

Buist v. Bromley Co., LLC, 151 A.D.3d 682, 55 N.Y.S.3d 443 (2d Dep’t 2017) (“Accordingly, we reverse the order and remit the matter to the Supreme Court, Kings County. Upon remittal, the defendants’ application for an extension of time to properly file the affidavit of service in the Clerk’s office should be granted ‘upon such terms as may be just’ (citation omitted), including service of the motion papers upon the plaintiff, who appeared pro se at the court appearance and on appeal, and an extension of the plaintiff’s time to oppose the motion. The defendants’ motion for summary judgment should thereafter be determined on the merits.”).

Matter of Meighan, 144 A.D.3d 917, 42 N.Y.S.3d 182 (2d Dep’t 2016) (“Here, there is no dispute that the respondents were served with the notice of petition and petition, as they moved to dismiss on the ground that the petition failed to state a cause of action. At no time did they argue that the proceeding should be dismissed for failure to file proof of service. As such, the parties did not have an opportunity to address the purported failure to file proof of service, the ground upon which the Supreme Court relied in denying the petition and dismissing the proceeding, even though such defect is readily curable (see CPLR 2001, 2004). ‘The lack of notice and opportunity to be heard implicates the fundamental issue of fairness that is the cornerstone of due process’ (citation omitted). Therefore, the Supreme Court should have alerted the parties to the purported defect and afforded the appellant an opportunity to correct it, rather than denying the petition and dismissing the proceeding (citation omitted).”).

Morgan Stanley Mtge. Loan Trust (2007-8XS) v. Harding, 141 A.D.3d 511, 35 N.Y.S.3d 235 (2d Dep’t 2016) (“As the Supreme Court correctly concluded, Harding’s papers on her motion to vacate her default were insufficient, as they did not include the plaintiff’s original motion papers or Harding’s proposed opposition papers (citations omitted) and failed to demonstrate that she had a potentially meritorious defense to the foreclosure action (citation omitted.”).

CPLR 2001 / 3026 - Verification error overlooked

Matter of Harder v. Kuhn, 153 A.D.3d 1119, 60 N.Y.S.3d 597 (3d Dep’t 2017) (“Preliminarily, we find no error in Supreme Court’s failure to dismiss the verified petition due to the verification having been notarized by Clyne. Clyne is a named respondent only because of his status as a Commissioner of the Board, the entity with which the certificates of substitution were filed, and he has no direct or pecuniary interest in the outcome (citation omitted). In view of this, and absent any prejudice to respondents flowing from the purported defect in the verification (citations omitted), Clyne’s notarization is not a basis for dismissal of the verified petition.”).

CPLR 2001 – But Failure to file remains jurisdictional defect not curable by CPLR 2001

Dealy-Doe-Eyes Maddux v. Schur, 139 A.D.3d 1281, 30 N.Y.S.3d 590 (3d Dep’t 2016) (“We affirm. ‘An action is commenced by filing a summons and complaint or summons with notice in accordance with [CPLR 2102]’ (CPLR 304 [a]). The failure to file the papers required to commence an action constitutes a nonwaivable, jurisdictional defect (citations omitted), and such a defect is not subject to correction under CPLR 2001 (citations omitted). Here, although plaintiff purchased an index number and filed a complaint, she never filed a summons or summons with notice. Given plaintiff’s failure, the purported action was a nullity, and Supreme Court properly dismissed it for want of subject matter jurisdiction (citations omitted). Moreover, to the extent that the complaint raised claims that were identical to those previously litigated and dismissed after a trial, such claims were barred by principles of res judicata (citations omitted). Plaintiff’s remaining contentions have been examined and found to be without merit.”).

Wesco Ins. Co. v. Vinson, 137 A.D.3d 1114, 26 N.Y.S.3d 870 (2d Dep’t 2016) (“In the Supreme Court, pursuant to CPLR 304, an action is ordinarily commenced ‘by filing a summons and

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. complaint or summons with notice,’ and a special proceeding is ordinarily commenced ‘by filing a petition’ (CPLR 304[a]). The failure to file the papers necessary to institute an action or a proceeding constitutes a nonwaivable, jurisdictional defect, rendering the action or proceeding a nullity (citations omitted). Although Wesco obtained an index number and moved to fix the amount of its workers’ compensation lien pursuant to Workers’ Compensation Law § 29, Wesco did not file or serve a summons, a complaint, or a petition. In light of this failure to file, the jurisdiction of the Supreme Court was never invoked and the purported action or proceeding was a nullity (citations omitted). Furthermore, Wesco’s complete failure to file the initial papers necessary to commence an action or a proceeding is not the type of error that falls within the court’s discretion to correct under CPLR 2001 (citations omitted).”).

ARTICLE 21 - PAPERS

CPLR 2103 - Service of papers

CPLR 2103(b) - Cannot serve party, where represented by counsel

CPLR 2103(b)(5) - Failure to effect proper service

Matter of Gabriel v. Morse, 145 A.D.3d 1401, 42 N.Y.S.3d 877 (3d Dep’t 2016) (“After completing an in-patient rehabilitation program, the father commenced this modification proceeding seeking joint legal custody and a schedule of parenting time. When the father failed to fully respond to the mother’s requests to disclose his treatment records, she moved for an order dismissing this proceeding with the condition that the father provide certified copies of his treatment records prior to refiling the petition. Thereafter, the father faxed a letter to Family Court seeking to withdraw the petition without prejudice. The father also faxed the letter to the mother’s counsel, despite the fact that the fax number set forth on prior correspondence from the mother’s counsel expressly provided that it was not to be used for service purposes (see CPLR 2103 [b] [5]). In addition, the father failed to follow up the fax to the mother’s counsel with a mailed copy of the letter, as required to complete service (see CPLR 2103 [b] [5]). Notwithstanding these failures, Family Court granted the father’s request within a few hours of receiving it, dismissed the petition without prejudice and denied the mother’s motion as moot. The mother now appeals, and we

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. reverse. We agree with the mother that the father’s letter must be treated as a motion for voluntary discontinuance pursuant to CPLR 3217 (b) (citations omitted) and, as such, it must comply with the applicable service requirements (see CPLR 2103 [b] [5]; 2214 [b]). Inasmuch as the father’s failure to effectuate proper service here ‘deprive[d] the court of jurisdiction to entertain the motion’ (citations omitted), we find that Family Court erred in dismissing the petition. In light of our determination, the mother’s remaining contentions are rendered academic.”).

ARTICLE 22- STAY, MOTIONS, ORDERS AND MANDATES

CPLR 2212 - Where motion made

CPLR 2212(a) / 510[3] / 511 / 511(b) - Even under IAS system, there can be a very limited circumstance where a motion can be made in a court other than the one in which the action is pending

CPLR 511(b) permits a motion to change venue based on improper county grounds to be made in the county in which the action is pending or in the county specified in the motion as being proper, if certain prerequisites are met (e.g., the defendant serves the demand to change venue with or prior to serving the answer and the plaintiff does not serve an affidavit showing that the county chosen by the plaintiff is correct or the county proposed by the defendant is incorrect). Otherwise, under the IAS system, generally motions are to be made in the court in which the action is pending. However, CPLR 2212(a) (which was enacted before the adoption of the IAS system) provides that a “motion on notice in an action in the supreme court shall be noticed to be heard in the judicial district where the action is triable or in a county adjoining the county where the action is triable.” This provision would seem to have very limited applicability after the adoption of the IAS System, perhaps restricted to rural or upstate courts, where there may be no available motion terms. However, some cases have suggested that the provision remains viable even downstate. See e.g.,Schwartz v. Yellowbook, Inc., 118 A.D.3d 691, 986 N.Y.S.2d 840 (2d Dep’t 2014) (“A motion to change venue on discretionary grounds, unlike motions made as of right, must be made in the county in which the action is pending, or in any county in that judicial district, or in any adjoining county (citations omitted). Schwartz was therefore required to make a motion pursuant to CPLR 510(3) in Nassau County, where the action was pending, in another county in the 10th Judicial District, or in a county contiguous to Nassau County (citation omitted). Since Nassau County and Richmond County are not contiguous, and Richmond County is not in the 10th Judicial District, the Supreme Court, Richmond County, erred in granting that branch of the motion which was pursuant to CPLR 510(3) (citations omitted).”). See also Minenko v. Swinging Bridge Camp Grounds of N.Y., Inc., 155 A.D.3d 1413, 63 N.Y.S.3d 914 (3d Dep’t 2017) (“It is well-settled that a motion to change venue on a discretionary ground, such as the convenience of material witnesses pursuant to CPLR 510 (3), ‘must be made in the county in which the action is pending, or in any county in that judicial district, or in any adjoining county’ (citations omitted). Here, it is undisputed that the action is pending in Kings County and that Sullivan County is not in the same judicial district as Kings County nor is it an adjoining county. In light of this, we find that defendants failed to bring their motion in a proper county and, thus, Supreme Court should not have entertained the motion (citations omitted).”).

CPLR 2214- service of motion papers

CPLR 2214(d) - Method of service provided for in an order to show cause is jurisdictional in nature and must be strictly complied with

People ex rel. Strong v. Warden Griffin, 75 N.Y.S.3d 540 (2d Dep’t 2018) (“‘The method of service provided for in an order to show cause is jurisdictional in nature and must be strictly complied with’ (citations omitted). Here, we agree with the Supreme Court's determination to dismiss the proceeding for lack of personal jurisdiction due to the petitioner's failure to follow the directive of the order to show cause to serve the respondent and the Attorney General with a copy of the papers upon which the order to show cause was based. Given the petitioner's failure to comply with the service requirements of the order to show cause, dismissal of the proceeding was warranted (citations omitted).”).

CPLR 2219/2220 - Time, form, entry and filing of order

CPLR 2219 / 2220 - Where there is a conflict between an order and decision, the decision controls

Where there is a conflict between an order and a decision, the decision controls. See Matter of Esposito v. Magill, 140 A.D.3d 1772, 32 N.Y.S.3d 802 (4th Dep’t 2016) (“As a preliminary matter, we note that where, as here, there is a conflict between the decision and order, the decision controls (citation omitted), and the order ‘must be modified to conform to the decision’ (citations omitted). We therefore modify the order by granting the motion seeking to dismiss the first petition.”); Wilson v. Colosimo, 101 A.D.3d 1765, 1766, 959 N.Y.S.2d 301, 303 (4th Dep’t 2012). See also Austin Harvard LLC v. City of Canandaigua, 141 A.D.3d 1158, 36 N.Y.S.3d 335 (4th Dep’t 2016) (“With respect to the declaratory judgment action, it is well settled that ‘parties to a civil dispute are free to chart their own litigation course’ (citation omitted), and ‘may fashion the basis upon which a particular controversy will be resolved’ (citation omitted). Here, the record establishes that the parties charted a summary judgment course, and Supreme Court’s bench decision reflects that the court denied plaintiff’s motion for summary judgment seeking a declaration in the second cause of action. The judgment, however, recites that the complaint ‘is in all respects denied and the matter is dismissed,’ and ‘[w]here, as here, there is a conflict between [a judgment] and a decision, the decision controls’ (citations omitted). We therefore modify the judgment to conform to the court’s bench decision.”).

CPLR 2219 / 2220 - 22 NYRR - § 202.48 does not apply because determination did not direct that proposed order or judgment be settled or submitted

HSBC Bank USA, N.A. v. Molev, 145 A.D.3d 970, 42 N.Y.S.3d 857 (2d Dep’t 2016) (“The Supreme Court incorrectly, sua sponte, dismissed the action as abandoned pursuant to 22 NYCRR 202.48(b) because, unlike the order dated March 7, 2007, its determination of the plaintiff’s 2014 motion did not expressly direct that the proposed judgment or order be settled or submitted for signature (see 22 NYCRR 202.48[a]; Funk v Barry, 89 NY2d 364, 367). Accordingly, we remit

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the matter to the Supreme Court, Suffolk County, for a determination of the plaintiff’s motion on the merits.”).

CPLR 2219 / 2220 - Once notice and proposed order filed in a timely fashion, “events that may have transpired thereafter to delay settlement of the order did not implicate 22 NYCRR 202.48”

HSBC Bank USA, N.A. v. Yonkus, 154 A.D.3d 643, 62 N.Y.S.3d 132 (2d Dep’t 2017) (“Here, the initial order granting the motion for summary judgment, dated September 30, 2010, directed the plaintiff to ‘[s]ettle order.’ Thus, pursuant to 22 NYCRR 202.48(a), the plaintiff was required to submit a notice of settlement and proposed order within 60 days thereafter, i.e., by the end of the day on November 19, 2010. In fact, the plaintiff filed the notice and proposed order on November 17, 2010, two days before the expiration of its time to do so pursuant to 22 NYCRR 202.48(a), as evidenced by a copy of the notice, stamped by the Queens County Clerk as received at 3 -06 p.m. that day. Any events that may have transpired thereafter to delay settlement of the order did not implicate 22 NYCRR 202.48. Moreover, it is apparent from the procedural history that the delay in entry of the judgment of foreclosure and sale was due to procedural irregularities, and not abandonment by the plaintiff (citations omitted).”).

CPLR 2219 / 2220 - Plaintiff’s failure to properly serve copy of summary judgment order with notice of entry did not render that order null and void

Wells Fargo Bank, N.A. v. Frierson, 150 A.D.3d 1045, 55 N.Y.S.3d 332 (2d Dep’t 2017) (“Here, the summary judgment order indisputably affected the rights of the defendant. Consequently, it was incumbent upon the plaintiff, in moving to confirm the referee’s report and for a judgment of foreclosure and sale, to demonstrate that the order was properly served upon the defendant’s attorney of record (citations omitted). Indeed, the summary judgment order provided that proof of such service ‘must accompany any application for final judgment of foreclosure and sale.’ The plaintiff failed to do so. Contrary to the defendant’s contention before the Supreme Court, the plaintiff’s failure to properly serve a copy of the summary judgment order with notice of entry did not render that order null and void (citation omitted). However, since the plaintiff failed to establish that a copy of the summary judgment order with notice of entry was properly served upon the defendant, its motion to confirm the referee’s report and for a judgment of foreclosure and sale was properly denied on that ground (citation omitted). In light of our determination, we need not reach the plaintiff’s remaining contention.”).

CPLR 2219 / 2220 - Appeal not properly before court because order was neither filed nor entered

Matter of Merrell v. Sliwa, 156 A.D.3d 1186 (3d Dep’t 2017) (“As a threshold matter, and as petitioner’s counsel acknowledged at oral argument, an appeal is not properly before this Court if the order appealed from ‘was not “entered and filed in the office of the clerk of the court where the action is triable”’ (citation omitted). The order at issue was neither entered nor filed. Accordingly, the appeal must be dismissed (citations omitted). . . . Footnote 1 - After oral argument, petitioner provided us with a copy of the order that reflects that it was ‘received’ by the

Albany County Clerk’s office. However, there is no indication that the order was filed or entered as required by CPLR 2220. We note that Supreme Court’s order explicitly stated that it was transferring the papers to the Albany County Clerk and returning the original order to counsel for respondents. Significantly, Supreme Court notified the parties that the signing of the order did not constitute entry or filing or relieve them of the obligation to do so pursuant to CPLR 2220.”).

CPLR 2221 - Motions to reargue or renew

CPLR 2221 - If a motion for leave to reargue, it was untimely and not appealable; if to renew, no reasonable justification proferred

Bank of N.Y. Mellon Trustee for CSMC Trust 2011-11 v. Xiaoling Shirley He, 151 A.D.3d 1403, 59 N.Y.S.3d 148 (3d Dep’t 2017) (“Defendant’s remaining contentions are equally without merit. If we construe defendant’s motion as one to reargue, given that it was filed 16 months after the order and 11 months after the judgment, it was untimely (citation omitted). In any event, no appeal lies from the denial of a motion to reargue (citations omitted). If we construe defendant’s motion as one to renew, it was properly denied on the ground that defendant failed to provide any reasonable justification for her failure to present the evidence proffered prior to the June 2013 order or the judgment of foreclosure and sale (citations omitted). Defendant’s remaining contentions are also academic and/or without merit.”).

CPLR 2221 - Law office failure constitutes reasonable justification

Trigoso v. Correa, 150 A.D.3d 1041 , 55 N.Y.S.3d 130 (2d Dep’t 2017) (“‘CPLR 2221(e) has not been construed so narrowly as to disqualify, as new facts not offered on the prior motion, facts contained in a document originally rejected for consideration because the document was not in admissible form’ (citation omitted). Here, Danu’s failure to provide signed copies of the deposition transcripts with the original summary judgment motion was tantamount to law office failure, which constituted a reasonable justification (citations omitted). Thus, the Supreme Court properly granted that branch of Danu’s motion which was for leave to renew.”).

CPLR 2221 – Motion to renew- no reasonable justification

Wright v. State of New York, 156 A.D.3d 1413, 65 N.Y.S.3d 874 (4th Dep’t 2017) (“Although claimant provided the court with a medical record purportedly documenting a medical appointment scheduled for June 11, 2015, he failed to provide a reasonable justification for his failure to present that medical record or the facts contained therein on the initial motion (citation omitted).”).

CPLR 2221 - Failure to present new facts on motions for leave to renew

Matter of Doman, 150 A.D.3d 994, 55 N.Y.S.3d 322 (2d Dep’t 2017) (“A court of original jurisdiction may entertain a motion for leave to renew or to vacate a prior order or judgment on the ground of newly discovered evidence even after an appellate court has affirmed the original order or judgment. Nonetheless, in order to imbue the appellate decision with a degree of certainty,

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. on a post-appeal motion for leave to renew or to vacate, the movant bears a heavy burden of showing due diligence in presenting the new evidence to the court of original jurisdiction (citations omitted). Here, the objectant failed to present ‘new facts not offered on the prior motion that would change the prior determination’ warranting renewal (CPLR 2221[e][2]).”).

CPLR 2221 - Motion for leave to renew based on deposition completed after prior motion had been decided

Donovan v. Rizzo, 149 A.D.3d 1038, 53 N.Y.S.3d 193 (2d Dep’t 2017) (“The new evidence included a transcript of the plaintiff’s deposition testimony, which had not been submitted to the court on the prior motion, as her deposition had not been completed until after the prior motion had been decided. Therefore, the motion was correctly denominated by the defendant as one for leave to renew his opposition to the plaintiff’s motion for summary judgment.”).

CPLR 2221 - Motions to reargue or renew -motion could be decided by another justice

Matter of Pettus v. Board of Directors, 155 A.D.3d 485, 65 N.Y.S.3d 21 (1st Dep’t 2017) (“Petitioners’ motion denominated as one for leave to renew and reargue was not based on new facts unavailable at the time of the original motion, and thus was actually a motion for leave to reargue, the denial of which is not appealable (citations omitted). That the motion was decided by a Justice other than the Justice who signed the underlying order of dismissal does not compel a different result, given that the CPLR permits sua sponte recusals and reassignments of such motions (citations omitted).”).

CPLR 2221 – Motion to renew- new facts?

Atlas v. Smily, 156 A.D.3d 562, 68 N.Y.S.3d 65 (1st Dep’t 2017) (“The motion court properly denied the wife’s motion to renew since it was not based on new facts that would change the prior determination (citations omitted). The ‘new facts’ presented by the wife, concerning the husband’s failure to timely file a satisfaction of judgment pursuant to the 2015 stipulation, were wholly unrelated to the court’s prior determination that the stipulation was not the product of duress (citation omitted). The wife, under the guise of renewal, actually advances a new legal theory (breach of the stipulation) rather than grounds for renewal of her original motion (invalidity of the stipulation on grounds of duress), and the court properly recognized her efforts to do so were not within the scope of CPLR 2221 (citations omitted).”).

CPLR 2221 / 2214(c) - Failure to include copy of original motion did not violate CPLR 2214©, because original motion had been filed electronically

Leary v. Bendow, 161 A.D.3d 420 (1st Dep’t 2018) (“Although plaintiffs failed to include a copy of defendants’ original motion to strike with the renewal motion, this did not violate CPLR 2214(c) because the original motion had been electronically filed and therefore was available to the parties and the court (citation omitted). There is no evidence that the record was not sufficiently complete to allow the court to render a decision on the renewal motion and to exercise its discretion in considering any improperly submitted document (citations omitted).”).

CPLR 2221 / 5015 - Proper vehicle to challenge order on default is motion to vacate under CPLR 5015(a)(1), and not CPLR 2221 motion to renew or reargue

Hutchinson Burger, Inc. v. Bradshaw, 149 A.D.3d 545, 50 N.Y.S.3d 267 (1st Dep’t 2017) (“The proper vehicle for defendant to challenge the October 2012 order, which was granted on her default, was a motion to vacate a default order under CPLR 5015(a)(1), and not a motion for renewal or reargument under CPLR 2221(d) and (e) (citations omitted). Accordingly, the motion court should have denied defendant’s motion to renew or reargue.”).

ARTICLE 23 - SUBPOENAS, OATHS AND AFFIRMATIONS

CPLR 2303-a - Service of a trial subpoena

CPLR 2303-a / 2103(b) - Trial subpoena properly served upon defendant’s attorneys

Chicoine v. Koch, 161 A.D.3d 1139 (2d Dep’t 2018) (“A court of record generally has the power ‘to issue a subpoena requiring the attendance of a person found in the state to testify in a cause pending in that court’ (Judiciary Law § 2-b[1]). ‘Where the attendance at trial of a party or person within the party’s control can be compelled by a trial subpoena, that subpoena may be served by delivery in accordance with [CPLR 2103(b)] to the party’s attorney of record’ (citation omitted). Here, the trial subpoena was properly served upon the defendant’s attorneys pursuant to CPLR 2303-a and 2103(b)(2). Contrary to the defendant’s contention, because he is a party to this action, over whom personal jurisdiction had been obtained, he is ‘found in the state’ within the meaning of Judiciary Law § 2-b(1) (citations omitted).”).

CPLR 2304 - Motions to quash

CPLR 2304 / 4503 - A claim of privilege with respect to testifying witness cannot be made until question is propounded implicating the privilege

Matter of Empire Wine & Spirits LLC v. Colon, 145 A.D.3d 1157, 43 N.Y.S.3d 542 (3d Dep’t 2016) (citing Weinstein, Korn & Miller) (“Turning first to the subpoena directed to Flug, respondents claim that, given her role as SLA’s general counsel, petitioner’s questions will necessarily elicit information protected by the attorney-client privilege, which applies to ‘confidential communication[s] made to [an] attorney for the purpose of obtaining legal advice or services’ (citations omitted). However, although a subpoena duces tecum can be vacated in advance on the basis of privilege, a different analysis applies to a subpoena that seeks testimony rather than documents (citation omitted). Where, as here, a witness has been served with a subpoena ad testificandum, ‘a claim of privilege cannot be asserted until the witness appears before the requisite tribunal and is presented with a question that implicates protected information’ (Matter of Holmes v. Winter, 22 NY3d 300, 319 [2013], cert denied ___ US ___, ___ , 134 S Ct 2664 [2014]; see Matter of Beach v. Shanley, 62 NY2d at 248; 4-2304 Weinstein-Korn-Miller,

NY Civ Prac ¶ 2304.13). Flug is entitled to invoke the attorney-client privilege if and when petitioner propounds questions that implicate protected information, but we agree with Supreme Court that she must first comply with the subpoena by appearing at the administrative hearing. ‘Only in this context can an intelligent appraisal be made as to the legitimacy of the claim of privilege’ (citations omitted).”).

CPLR 2308 - Disobedience of subpoena

CPLR 2308(a) - Court refused to issue of warrant of arrest

Cadlerock Joint Venture, L.P. v. Forde, 152 A.D.3d 483, 54 N.Y.S.3d 878 (2d Dep’t 2017) (“Contrary to the plaintiff’s contention, the Supreme Court providently exercised its discretion in denying the plaintiff’s motion pursuant to CPLR 2308(a), in effect, for the issuance of a warrant of arrest to bring the defendant before the Supreme Court, upon his alleged failure to comply with a postjudgment judicial subpoena duces tecum dated October 23, 2013, and an order of contempt of that court dated March 6, 2014 (citation omitted). CPLR 2308(a) sets forth the penalties applicable to the disobedience of a judicial subpoena. The available penalties include the issuance of ‘a warrant directing a sheriff to bring the witness into court’ (citation omitted). Here, the court declined to issue such a warrant, finding that the plaintiff could avail itself of ‘all other remedies pursuant to the CPLR to collect’ a judgment in favor of the plaintiff and against the defendant. We find no basis in the record to disturb that determination.”).

ARTICLE 30 – REMEDIES AND PLEADINGS

CPLR 3001- Declaratory judgment

CPLR 3001 / 5520 - Mootness

Matter of Truscott v. City of Albany Bd. of Zoning Appeals, 152 A.D.3d 1038, 55 N.Y.S.3d 919 (3d Dep’t 2017 (“[T]he power of a court to declare the law only arises out of, and is limited to, determining the rights of persons which are actually controverted in a particular case pending before the tribunal’ (citations omitted). ‘In general[,] an appeal will be considered moot unless the rights of the parties will be directly affected by the determination of the appeal and the interest of the parties is an immediate consequence of the judgment’ (citations omitted). If, as here, ‘a change in circumstances prevents a court from rendering a decision that would effectively determine an actual controversy, [then] the claim must be dismissed’ (citations omitted). Inasmuch as petitioners’ rights are no longer ‘actually controverted’ and a determination of their appeal would not affect the rights of the parties, the appeal must be dismissed as moot (citations omitted). Petitioners’ contention that a live controversy remains because a related code enforcement proceeding still remains pending against them is unavailing. Simply put, that separate and distinct proceeding is not before us on this appeal and does not affect our mootness finding.”).

CPLR 3011 - Kinds of pleadings

CPLR 3011 / 3211 / 3211(a)(1) - The assertion of affirmative causes of action in a reply to a counterclaim is procedurally improper.

MLB Constr. Servs., LLC v. Lake Ave. Plaza, LLC, 156 A.D.3d 983, 66 N.Y.S.3d 568 (3d Dep’t 2017).

CPLR 3012- Service of pleadings and demand for complaint

CPLR 3012(b) / 320 - Cannot demand complaint before service of summons with notice but can demand where service is made under CPLR 308(2) but before proof of service is filed

A defendant cannot demand a complaint before being served with a summons with notice. See Micro-Spy, Inc. v. Small, 9 A.D.3d 122, 778 N.Y.S.2d 86 (2d Dep’t 2004) (service of demand for complaint after filing of summons but before service was premature). However, a defendant can serve a demand after the plaintiff serves the defendant pursuant to CPLR 308(2), but before service is complete, that is, before the plaintiff has filed the proof of service. See Wimbledon Fin. Master Fund, Ltd. v. Weston Capital Mgt. LLC, 150 A.D.3d 427, 55 N.Y.S.3d 1 (1st Dep’t 2017) (“Plaintiff commenced this securities fraud action against 26 defendants by filing a summons with notice on October 16, 2015, and served defendant Manley pursuant to CPLR 308(2) twelve days later. On November 3, 2015, before plaintiff had filed proof of service, defendant served a demand for a complaint pursuant to CPLR 3012(b). Plaintiff, taking the position that the demand was a nullity, asked defendant to agree to accept a complaint served by the end of December. Defendant refused, and instead moved to dismiss the action on November 24, the 21st day after service of its demand. Plaintiff served a complaint on December 24, 2015. We agree with the motion court that under CPLR 3012(b), defendant was permitted to serve a demand for a complaint after being served, notwithstanding that service was not technically ‘complete.’ The time frames applicable to defendants set forth in CPLR 3012(b) are deadlines, not mandatory start dates (citations omitted). In the cases relied on by plaintiff, the defendants’ demands were ineffective to trigger plaintiff’s time to serve a complaint pursuant to CPLR 3012(b) because the defendants had not yet been served with a summons with notice, and the CPLR makes no provision for an appearance or a demand for a complaint before the summons is served (citations omitted).”).

CPLR 3012(d) - Majority and dissent disagree as to whether lower court properly denied motion for extension of time under CPLR 3012(d),

Emigrant Bank v. Rosabianca, 156 A.D.3d 468, 67 N.Y.S.3d 175 (1st Dep’t 2017) (Majority and dissent disagree as to whether lower court properly denied motion for relief under CPLR 3012(d), in applying the factors adopted in the First Department, that is, the length of the delay, the excuse offered, the extent to which the delay was willful, the possibility of prejudice to adverse parties, and the potential merits of any defense. In affirming, the majority noted that: “Of these five factors, three — the lack of a potential meritorious defense, which is the most notable, the length of the delay, and the willfulness of the default — weigh against granting the motion. The remaining

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. factors, whether the delay was excusable and whether there was any possibility of prejudice to an adverse party, are arguably neutral. Therefore, considering and weighing the five Artcorp/Guzzetti factors, we conclude that Supreme Court properly denied the Rosabiancas’ motion”; The dissent disagreed: “The record before us supports a finding that defendants Carmelo and Vivian Rosabianca should have been granted permission to interpose a late answer, upon consideration of every applicable factor. Most notably, the motion court failed to consider ‘the strong public policy in favor of resolving cases on the merits,’ which we have held normally weighs in favor of granting such motions (citation omitted). That is particularly appropriate here, where the movants demonstrated, although ‘not essential’ on this pre-judgment request to file a late answer, that they have at least two meritorious defenses to this foreclosure proceeding (citations omitted). First, in accepting the mortgage executed by Luigi Rosabianca on his parents’ home, plaintiff’s predecessor improperly relied on powers of attorney that did not give Luigi Rosabianca actual authority, or necessarily apparent authority, to mortgage his parents’ home. In addition, plaintiff fails to state a cause of action to foreclose the mortgage signed in the names of Carmelo and Vivian Rosabianca, because the mortgage states that it secures a note signed by them, but plaintiff bases its foreclosure action only on a note signed by their son, and no note signed by the senior Rosabiancas has been produced.”).

CPLR 3012(d) / 2005 - Brief delay in answering

Naber Elec. v. Triton Structural Concrete, Inc., 160 A.D.3d 507, 75 N.Y.S.3d 152 (1st Dep’t 2018) (“The motion court providently exercised its discretion in denying plaintiffs' motion and granting defendants' cross motion to compel plaintiffs to accept their answer (citation omitted), which was served two weeks late. Defendants' attorney explained that the brief delay in answering resulted from his mistake in calendaring the date the response was due, after he mistakenly requested an extension of time to April 7, rather than May 7. Since defendants' time to answer, without any extension, was April 17th, his mistake should have been apparent to plaintiffs' attorney, who agreed to the requested extension. Defense counsel's inadvertent mistake in calendaring his deadline provided a reasonable excuse for the minimal delay in answering (citations omitted).”).

CPLR 3012-a - Certificate of merit in medical, dental and podiatric malpractice actions

CPLR 3012-a - Certificate of merit and delay in serving complaint – proffered excuse insufficient

Marcello v. Flecher, 150 A.D.3d 1457, 55 N.Y.S.3d 488 (3d Dep’t 2017) (“Here, plaintiff’s proffered excuse for the delay in serving the complaint was that he was awaiting review of his medical records by certain unnamed physicians as required by CPLR 3012-a. The flaw in plaintiff’s analysis on this point is that the cited statutory provision pertains to the requirement that a certificate of merit accompany any complaint sounding in medical, dental or podiatric malpractice. Inasmuch as plaintiff filed the required certificate of merit with his summons with notice in June 2015, we are hard pressed to ascertain how the need for such certificate impacted his ability to serve the complaint in a timely manner. To the extent that counsel for plaintiff further argues that the delay was occasioned due to counsel’s decision to consult with another attorney,

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. who, in turn, suggested that further medical review of plaintiff’s claim was warranted prior to service of the complaint, we again find the proffered excuse to be insufficient. In any event, even assuming that plaintiff provided a reasonable excuse for the 41-day delay at issue here, there is no question that he failed to demonstrate the existence of a potentially meritorious cause of action.”).

CPLR 3013 - Particularity of statements, generally

CPLR 3013 / 3211 - Majority and dissent disagree as to whether or not legal malpractice claim was properly pleaded

Mid-Hudson Val. Fed. Credit Union v. Quartararo & Lois, LLC, 155 A.D.3d 1218, 64 N.Y.S.3d 389 (3d Dep’t 2017) (Compare majority - “Absent from the amended complaint is any mention of an instance of deficient representation or any example of erroneous advice by defendants. Merely alleging the elements of a legal malpractice claim in a general fashion, without more, does not satisfy the liberal pleading standard of CPLR 3211. … The statements in the amended complaint fail … in that they do not allege a single transaction where defendants were retained to provide legal services or a single occurrence of negligent legal representation forming the basis of the legal malpractice claim, let alone the specific underlying foreclosure action or actions in which defendants allegedly committed legal malpractice. Other than stating that defendants represented plaintiff in foreclosure actions, the amended complaint does not allege, and, more critically, it cannot reasonably be inferred from such pleading, what defendants allegedly did or did not do in a negligent fashion. The amended complaint is not just sparse on factual details — rather, it is wholly devoid of them. Given the absence of detailed facts, the legal malpractice cause of action should have been dismissed (citations omitted).”; and dissent - “Here, the allegations of legal malpractice in plaintiff’s complaint — although lacking detail — state factual allegations that provide the degree of notice necessary to satisfy this generous standard. We therefore respectfully dissent from the majority as to that cause of action. … The majority objects to the lack of specific details as to the particular foreclosure and debt collection actions that defendants allegedly handled inadequately. However, that analysis focuses incorrectly on whether plaintiff has properly stated a claim, rather than on whether it has one (citation omitted). The CPLR provides remedies for such a lack of detail, much less drastic than dismissal. When the complaint ‘is so vague or ambiguous that [the defendant] cannot reasonably be required to frame a response,’ the defendant may move for a more definite statement (citation omitted). Where, as here, the issue is lack of detail, so that ‘what [a defendant] really wants is an amplification of the allegations rather than their clarification,’ the ready remedy is to demand a bill of particulars (citations omitted). The majority rejects the remedy provided by the CPLR on the ground that defendants chose not to avail themselves of it. However, our determination of this appeal does not turn on defendants’ choice of procedure, but upon the governing law. We are charged with determining whether Supreme Court acted properly in denying defendants’ motion to dismiss plaintiff’s cause of action for legal malpractice. That court applied the standards of the CPLR and many years of precedent in finding that, when treated as true and granted the benefit of every favorable inference, the factual allegations in this complaint are sufficient to make out a cognizable case of legal malpractice. We cannot find any error of law in this determination.”).

CPLR 3016 - particularity in specific actions

CPLR 3016 / 3211 - Failure to plead properly

Rssm CPA LLP v. Bell, 2018 NY Slip Op 04645 (1st Dep’t 2018) (“The parts of the breach of fiduciary duty and breach of the duty of loyalty causes of action based on allegations that defendant used plaintiff's confidential information to solicit clients and personnel away from plaintiff and that defendant improperly wrote off billable hours for clients and/or capped their bills are insufficiently particularized to raise an issue of fact, since they do not identify any of the clients or personnel referred to (citations omitted). The parts of the cause of action for tortious interference with contract not based on the other individual defendants' contracts do not identify the contracts that were interfered with and therefore fail to raise an issue of fact as to their existence (citation omitted). The parts of the cause of action for tortious interference with prospective economic relationships based on relationships with potential clients or unidentified former personnel of plaintiff are insufficient to show that plaintiff would have obtained those contracts but for defendant's tortious interference (citation omitted).”).

Golia v. Vieira, 2018 NY Slip Op 04538 (2d Dep’t 2018) (“However, we agree with the Supreme Court's determination to grant that branch of LICH's motion which was pursuant to CPLR 3211(a)(7) to dismiss the fourth cause of action insofar as asserted against it. The allegations in the fourth cause of action did not satisfy the special pleading requirements of CPLR 3016(a), as they did not set forth the actual words complained of, and they also failed to specify the particular persons to whom LICH allegedly published the alleged defamatory statements (citations omitted).”).

Carlyle, LLC v. Quik Park 1633 Garage LLC, 160 A.D.3d 476, 75 N.Y.S.3d 139 (1st Dep’t 2018) (“The actual fraudulent conveyance claims, under the common law and Debtor and Creditor Law (DCL) § 276, should be dismissed because plaintiff failed to allege fraudulent intent with the particularity required by CPLR 3016(b) (citations omitted). The key allegations were made ‘[u]pon information and belief,’ without identifying the source of the information (citation omitted). Moreover, the timing of the allegedly fraudulent transfers - beginning two years before the judgment debtors incurred the subject debts - undermines the claim of fraudulent intent (citations omitted). The constructive fraudulent conveyance claims pursuant to DCL 273, 274, and 275 should be dismissed because plaintiff failed to sufficiently allege that the transfers were made without fair consideration, as the relevant allegations were all made ‘[u]pon information and belief’ (citation omitted). Because the viability of the claims under DCL 276-a, 278, and 279 depends on the viability of the other fraudulent conveyance claims, these claims should likewise be dismissed. The tortious interference claim should be dismissed because plaintiff failed to sufficiently allege that the contract ‘would not have been breached but for' the defendant's conduct’ (citations omitted). The relevant allegations were vague and conclusory and supported by ‘mere speculation’ (citations omitted). In light of the dismissal of all of plaintiff's substantive claims, its claims for piercing the corporate veil and a permanent injunction must likewise be dismissed, as they do not constitute independent causes of action (citations omitted).”).

CPLR 3016(b) - Fraud claim not pleaded with requisite particularity

MP Cool Invs. Ltd. v. Forkosh, 142 A.D.3d 286, 40 N.Y.S.3d 1 (1st Dep’t 2016) (“We affirm the motion court’s dismissal of plaintiff’s fraud claims because they were not pleaded with the requisite particularity (citation omitted). Moreover, plaintiff’s allegations do not establish justifiable reliance as required to prove fraud because plaintiff is a sophisticated investor that had the means available to it to learn the true nature and real quality of the investment it made (citation omitted). Nor do the allegations support the element of scienter necessary for fraud.”).

CPLR 3016(b) - Failure to allege material misrepresentation

Weinberg v. Sultan, 142 A.D.3d 767, 37 N.Y.S.3d 13 (1st Dep’t 2016) (“Nonetheless, the amended complaint is barebones. It fails to allege any ‘material misrepresentation,’ which is a required element of a fraud claim (citations omitted). Further, plaintiff does not allege how defendant purchaser Linda Salamon and her company, defendant 22 West 30th St. Properties, LLC (together Salamon), exerted any undue influence over plaintiff (citation omitted) or coerced her into a transaction that she alleges made no economic sense. The amended complaint also failed to plead the fraud and undue influence claims with sufficient particularity, as required by CPLR 3016(b) (citation omitted).”).

CPLR 3018- Responsive pleadings

CPLR 3018 - Non jurisdictional defenses can be raised in answer amended via motion in the absence of prejudice

Charles v. William Penn Life Ins. Co. of N.Y., 75 N.Y.S.3d 36 (1st Dep’t 2018) (“Plaintiff's argument that defendant waived the proposed affirmative defenses, is unavailing because the defenses are not jurisdictional defenses and can be raised in an amended answer in the absence of prejudice (citations omitted), and here, all three defenses were based on the decedent's medical records, which plaintiff had prior to the commencement of the action (citations omitted).”).

CPLR 3018 - Defense is not waived on ground that it was too conclusory

Matter of Part 60 RMBS Put-Back Litig., 155 A.D.3d 482, 65 N.Y.S.3d 133 (1st Dep’t 2017) (“Nor should the affirmative defense be deemed waived on the ground that it is too conclusory (citation omitted). It ‘would be an excessively severe result’ to ‘treat[] the defense as waived’ (citation omitted), especially since plaintiff has known since at least April 29, 2016 that defendant was disputing the effectiveness of Computershare’s appointment. Moreover, ‘[i]f the [capacity] defense is meritorious, a determination of that issue would result in a speedy and less expensive conclusion to otherwise protracted litigation’ (citation omitted).”).

CPLR 3018 / 3211(e) - Preserving affirmative defenses in pre-answer motion or in responsive pleading

Outdoors Clothing Corp. v. Schneider, 153 A.D.3d 717, 60 N.Y.S.3d 302 (2d Dep’t 2017) (“Initially, we reject the plaintiffs’ contention that the defendants waived the affirmative defense of release. As with the other defenses and objections listed in CPLR 3211(a)(5), the affirmative defense of release is waived unless it is raised in a pre-answer motion to dismiss or in a responsive pleading (citations omitted). Here, the defendants avoided waiving the affirmative defense of release by raising it in their pre-answer motion to dismiss, and they were thereafter entitled to seek summary judgment based on that defense despite its absence from the answer (citations omitted).”) (citing Weinstein, Korn & Miller).

CPLR 3019 - Counterclaims and cross-claims

CPLR 3019 - Cannot later assert in state court, “compulsory counterclaim” in prior federal action. See below discussion, CPLR 3211, of Paramount Pictures Corp. v. Allianz Risk Transfer AG, 31 N.Y.3d 64, 73 N.Y.S.3d 472, 96 N.E.3d 737 (2018).

CPLR 3019 - Counterclaims survive despite dismissal of petition

Matter of Eshaghian, 144 A.D.3d 1163, 43 N.Y.S.3d 393 (2d Dep’t Nov. 30, 2016) (“Despite the dismissal of the petition itself by the Surrogate’s Court, the coexecutrices’ counterclaims remained viable (citations omitted). ‘A counterclaim is in essence a complaint by a defendant against the plaintiff and alleges a present viable cause of action upon which the defendant seeks judgment’ (citations omitted). In properly asserting their counterclaims (citations omitted), the coexecutrices were, in substance, petitioners. Further, since the court had already directed the dismissal of David Eshaghian’s petition, the coexecutrices were the only remaining ‘petitioners’ in the proceeding. In denominating themselves as ‘petitioners’ in their proposed amended pleading, the executrices were merely recognizing this circumstance. Moreover, there is no indication that the coexecutrices’ proposed amended pleading was palpably insufficient or patently devoid of merit, or that David Eshaghian would be unfairly surprised or prejudiced as a result of the coexecutrices’ delay in seeking to serve an amended pleading (citation omitted). Accordingly, the court improvidently exercised its discretion in denying that branch of the coexecutrices’ motion which was for leave to serve an amended pleading.”).

CPLR 3019 - Counterclaims need to be appended to answer; cannot be “standalone”

Rubin v. Napoli Bern Ripka Shkolnik, LLP, 151 A.D.3d 603, 58 N.Y.S.3d 320 (1st Dep’t 2017) (“As to the proposed defamation counterclaims, defendant initially sought to assert them as standalone counterclaims within the one-year limitations period. However, the counterclaims were dismissed as procedurally improper, since they were not appended to an answer (citations omitted). Because the motion for leave to amend was made less than six months later, the proposed counterclaims could be saved by CPLR 205(a)’s six-month grace period (citations omitted).”).

CPLR 3022 – Remedy for defective verification

CPLR 3022 - Waiver of objection to lack of verification

Larke v. Moore, 150 A.D.3d 1620, 54 N.Y.S.3d 239 (4th Dep’t 2017) (“Plaintiffs nevertheless contend that, because they rejected Moore’s answer and treated it as a nullity (citation omitted), they were entitled to a default judgment against Moore and Moore’s motion to dismiss pursuant to CPLR 3211 (a) (5) was precluded by CPLR 3211 (e). We reject that contention. Moore timely served an answer and counterclaim in which she raised the affirmative defense that plaintiffs did not commence their action within the applicable statute of limitations. Although Moore’s answer did not contain the requisite verification (citation omitted), plaintiffs in this case ‘proceeded on the theory that [they] had to prove [their] claim[s] as if [they] stood controverted. [They] did not seek to proceed as if upon a default’ (citation omitted). Furthermore, plaintiffs waived any objection to the lack of verification by waiting nearly two months to reject the answer (citations omitted). We therefore conclude that plaintiffs failed to act with ‘due diligence’ as required by CPLR 3022.”).

CPLR 3025 – Amended and supplemental pleadings

CPLR 3025

David L. Ferstendig, Further Appellate Division Conflicts, and One Resolved, 689 N.Y.S.L.D. 4 (2018)

Agreement on Standard to Apply On a Motion to Amend

Fortunately, I can report that the Departments are now in agreement as to the standard a court is to apply when considering a party’s motion to amend its pleadings pursuant to CPLR 3025(b). The issue was whether a proponent of such a motion is required to make an evidentiary showing that the proposed amendment has merit. Three of the four Departments had held that no such showing was required.

Instead, the standard to apply is that "[i]n the absence of prejudice or surprise resulting directly from the delay in seeking leave, such applications are to be freely granted unless the proposed amendment is palpably insufficient or patently devoid of merit." Lucido v. Mancuso, 49 A.D.3d 220, 222 (2d Dep’t 2008). See also Cruz v. Brown, 129 A.D.3d 455, 456 (1st Dep’t 2015); Holst v. Liberatore, 105 A.D.3d 1374, 1374–75 (4th Dep’t 2013).

The Third Department had bucked the trend, and continued to require an evidentiary showing of merit, until its recent decision in NYAHSA Servs., Inc. Self-Insurance Trust v. People Care Inc., 156 A.D.3d 99 (3d Dep’t 2017). There, in establishing unanimity among the Departments, the Third Department noted that

[t]he rationale for adopting this rule is that the liberal standard for leave to amend that was adopted by the drafters of the CPLR is inconsistent with requiring an evidentiary showing of merit on such a motion. "If the opposing party [on a motion to amend] wishes to test the merits of the proposed added cause of action or defense, that party may later move for summary judgment [or to dismiss] upon a proper showing" (citation omitted).

Id. at 102.

CPLR 3025 - Amendment contradicting allegation in original complaint does not render proposed amendment patently without merit

Brannigan v. Christie Overhead Door, 149 A.D.3d 892, 53 N.Y.S.3d 106 (2d Dep’t 2017) (“Here, the plaintiff’s proposed amendment contradicted an allegation in the original complaint, but that inconsistency simply raises an issue of credibility that may be addressed later in the action; it does not, contrary to the third-party defendants’ contention, render the proposed amendment patently without merit.”).

CPLR 3025 - No complaint to amend because court granted motion to dismiss

Panagoulopoulos v. Carlos Ortiz Jr MD, P.C., 143 A.D.3d 792, 38 N.Y.S.3d 807 (2d Dep’t 2016) (“The Supreme Court properly denied the plaintiffs’ motion for leave to amend the complaint. Prior to this motion, the court granted the defendants’ motion to dismiss the complaint (citation omitted). Thus, there was no complaint before the court to amend (citations omitted). In any event, the proposed amendments were palpably insufficient or patently devoid of merit (citation omitted). Moreover, we note that the proposed amended complaint did not clearly show the changes or additions to be made to the pleading (see CPLR 3025[b]).”).

CPLR 3025 / 3211 - Original complaint no longer viable, as amended complaint takes the place of original pleading

Golia v. Vieira, 2018 NY Slip Op 04537 (2d Dep’t 2018) (“The original complaint was superseded by the amended complaint. ‘The original complaint is no longer viable, inasmuch as the amended complaint takes the place of the original pleading’ (citations omitted). Thus, the appeal from the order entered August 20, 2015, which granted LICH's motion pursuant to CPLR 3211(a) to dismiss the original complaint, has been rendered academic (citation omitted).”).

CPLR 3025 - Proposed amendment patently devoid of merit

Cahill v. Jordan Home Servs., LLC, 145 A.D.3d 847, 44 N.Y.S.3D 133 (2d Dep’t 2016) (“‘In general, Workers’ Compensation benefits are the sole and exclusive remedy of an employee against an employer for any damages sustained from injury or death arising out of and in the course of employment’ (citations omitted). ‘This precludes suits against an employer for injuries in the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. course of employment’ (citations omitted). Here, the proposed amendment was patently devoid of merit, as the Workers’ Compensation defense was available only to the injured plaintiff’s employer, and the appellant failed to allege facts demonstrating that he was the injured plaintiff’s employer or that the Workers’ Compensation Law otherwise bars this action against the appellant. Accordingly, the Supreme Court providently exercised its discretion in denying the appellant’s motion for leave to amend his answer.”).

CPLR 3025 - Motion denied; proposed amendment is palpably insufficient

762 Park Place Realty, LLC v. Levin, 161 A.D.3d 1135 (2d Dep’t 2018) (“While leave to amend the pleadings shall be freely given (citation omitted), leave should not be granted when the proposed amendment is palpably insufficient or devoid of merit (citation omitted). Here, the proposed breach of contract cause of action must fail on the ground that the purported transfer provision of the 2008 agreement allegedly breached is unenforceable for lack of consideration. The proposed cause of action for dissolution of the LLC also must fail because an application for dissolution of an LLC must be made by or for a member of the LLC (citation omitted). Ayala failed to demonstrate that she was a member of the LLC and she did not interpose the intervenor complaint on behalf of a member of the LLC. Accordingly, that branch of the cross motion which was for leave to amend the intervenor complaint should have been denied.”).

J.W. Mays, Inc. v. Liberty Mut. Ins. Co., 153 A.D.3d 1386, 61 N.Y.S.3d 144 (2d Dep’t 2017) (“The Supreme Court also properly denied the plaintiff’s cross motion for leave to amend the complaint. Although leave to amend should be freely given in the absence of prejudice or surprise to the opposing party (citation omitted), the motion should be denied where the proposed amendment is palpably insufficient or patently devoid of merit (citations omitted). ‘Whether to grant such leave is within the motion court’s discretion, the exercise of which will not be lightly disturbed’ (citation omitted). Here, the proposed amendments were palpably insufficient, since none of the additional facts alleged in the proposed amended complaint in the Owens action established the plaintiff’s potential liability for bodily injury, property damage, or personal and advertising injury.”).

CPLR 3025 - Standard- defendants failed to demonstrate that proposed amendment resulted in prejudice or surprise, and the proposed cause of action was neither palpably insufficient nor patently devoid of merit

Katz v. Beil, 142 A.D.3d 957, 39 N.Y.S.3d 157 (2d Dep’t 2016) (“The Supreme Court also should have granted leave to amend the amended complaint to assert a cause of action for declaratory and injunctive relief against the individual defendants, as set forth in the proposed tenth cause of action in the proposed second amended complaint. The individual defendants failed to demonstrate that the proposed amendment resulted in prejudice or surprise, and the proposed cause of action was neither palpably insufficient nor patently devoid of merit (see generally id.).”).

CPLR 3025 - Motion to amend granted; prejudice not established

Central Amusement Intl. LLC v. Lexington Ins. Co., 75 N.Y.S.3d 35 (1st Dep’t 2018) (“The motion court did not abuse its discretion in granting defendant's motion to amend its answer (citations omitted). Plaintiff's argument that it was prejudiced at the time of the amendment because it was time-barred from pursuing a professional malpractice claim against its engineer, is unavailing. The motion court correctly observed that plaintiff had the opportunity and duty to perform its own investigation to uncover potential culpable conduct by its contractors, engineers, or any other party that may have contributed to the loss, but it chose not to do so. Plaintiff has also not established the validity of its prejudice claim, as it never attempted to sue its engineer (or other third party) following the disclosure of defendant's expert report. The claim that defendant's production of the expert report was delayed finds no support since it was timely produced during expert discovery.”).

CPLR 3025 - Motion granted; there was delay, but no prejudice

Wojtalewski v. Central Sq. Cent. Sch. Dist., 161 A.D.3d 1560 (4th Dep’t 2018) (“Defendants argued in opposition to the cross motion that plaintiff failed to proffer any excuse for her delay in seeking leave to amend the complaint, but ‘[m]ere lateness is not a barrier to the amendment. It must be lateness coupled with significant prejudice to the other side’ (citations omitted). Therefore, although plaintiff provided no excuse for her delay in seeking leave to amend, that is of no moment because, as noted above, defendants have not shown that they were prejudiced by the delay (citation omitted). We further reject defendants' contention that the proposed amendment was patently insufficient on its face (citations omitted). To the extent that defendants raise on appeal an alternative ground for affirmance (citation omitted), we conclude that it lacks merit.”).

CPLR 3025 - When amending personal injury complaint to add cause of action for wrongful death, plaintiff is required to submit competent medical proof of the causal connection between the alleged malpractice and the death of the original plaintiff

Frangiadakis v. 51 W. 81st St. Corp., 161 A.D.3d 478, 73 N.Y.S.3d 420 (1st Dep’t 2018) (“[A]s we have stated, to support amending a personal injury complaint to add a cause of action for wrongful death, plaintiffs were required to submit ‘competent medical proof of the causal connection between the alleged malpractice and the death of the original plaintiff’ (citation omitted). The affirmation of plaintiffs’ expert, which stated that to a reasonable degree of medical certainty the decedent’s injury led to his death, was sufficient, for the purposes of CPLR 3025(b), to establish a causal connection between the decedent’s death and the originally alleged negligence by defendants (citations omitted). Plaintiff’s submission of the expert’s affirmation on reply is not fatal to the motion, because defendant was permitted to submit a surreply.”).

CPLR 3025 - Prejudice is not merely alleged exposure to increased liability; instead, there must be some indication that the party has been hindered in the preparation of his or her case or has been prevented from taking some measure in support of his or her position’

NYAHSA Servs., Inc., Self-Insurance Trust v. People Care Inc., 156 A.D.3d 99, 64 N.Y.S.3d 730 (3d Dep’t 2017) (“Defendants have not demonstrated that they will be prejudiced by, or suffer undue surprise attributable to, the delay in requesting that the trustees be permitted to join the identical claims raised by plaintiff, which would not subject defendants to new liability or new

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. theories of recovery (citation omitted). Likewise, defendants cannot credibly claim surprise or prejudice from plaintiff’s request to supplement its claims to include the unpaid adjustment bills that accrued subsequent to the filing of the amended complaints. The added claims are premised upon the same legal theories and a common factual basis. Initially, defendants did not dispute that they had not paid the adjustment bills that accrued and were sent by plaintiff during the pendency of these actions. Defendants’ argument that they would be prejudiced because the proposed amendments would subject them to increased liability is unavailing, as ‘[p]rejudice is more than the mere exposure of the [opposing parties] to greater liability’ (citation omitted). In this context, a party’s burden of showing prejudice requires ‘some indication that the party has been hindered in the preparation of the party’s case or has been prevented from taking some measure in support of its position’ (citations omitted). Defendants made no such showing and, indeed, they did not argue that they were hindered by the delay or prevented from taking measures to support their positions.”).

Matter of Bynum v. Camp Bisco, LLC, 155 A.D.3d 1503 (3d Dep’t 2017) (“Supreme Court providently exercised its discretion in granting plaintiff’s motion to amend the complaint to add a cause of action for wrongful death following the death of decedent. In support of her motion, plaintiff submitted an affirmation alleging that decedent died as a result of injuries suffered due to defendants’ negligence, which defendants opposed by challenging the adequacy of proof of causation. In reply, plaintiff submitted decedent’s death certificate, which lists as the primary cause of death acute respiratory failure due to sepsis and anoxic brain injury that occurred years earlier. Secondarily, it indicated that decedent had a seizure disorder that contributed to her death, but was not related to the primary cause of death. Decedent’s dire condition and prognosis were known from the outset, discovery has been ongoing, the proposed amendment does not change the theory of recovery and, given its nature, obviously could not have been added prior to decedent’s death (citation omitted). In this procedural context, ‘[p]rejudice is more than the mere exposure of the [party] to greater liability,’ as ‘there must be some indication that the [party] has been hindered in the preparation of [the party’s] case or has been prevented from taking some measure in support of [its] position’ (citations omitted). As Supreme Court correctly found, defendants failed to meet their burden of demonstrating either prejudice or hindrance and, on these facts, they cannot credibly claim surprise from the proposed amendment (citations omitted).”).

CPLR 3025 - Motion denied; proposed counterclaim insufficient to state claim

Y.A. v. Conair Corp., 154 A.D.3d 611, 62 N.Y.S.3d 116 (1st Dep’t 2017) (“Motions for leave to amend pleadings should be freely granted, absent prejudice or surprise resulting therefrom, unless the proposed amendment is palpably insufficient or patently devoid of merit (citation omitted). Here the proposed counterclaims, as pleaded, state nothing other than a claim that plaintiff negligently supervised her own children with respect to a ‘common, daily household hazard[]’ (citation omitted), which, as the Second Department has held in very similar circumstances, does not implicate any duty owed to the public at large, and is insufficient to state a cognizable claim under Holodook (citations omitted).”).

CPLR 3025 / 3211(e) - Affidavit of merit

Hickey v. Steven E. Kaufman, P.C., 156 A.D.3d 436, 66 N.Y.S.3d 474 (1st Dep’t 2017) (“Given the Legislature’s 2005 amendment of CPLR 3211(e) (citations omitted), plaintiff was not required to support his motion to amend the complaint with an affidavit of merit (citation omitted). However, even viewed in the light of older precedent requiring an affidavit of merit on a motion to amend (citation omitted), the court providently exercised its discretion in finding that plaintiff’s verification of the proposed amended complaint and his affidavit in opposition to defendants’ motions to dismiss the original complaint, which affidavit was annexed as an exhibit to the proposed amended complaint, satisfied the requirement of an affidavit of merit. Plaintiff was not required to explain his approximately six-month delay in moving to amend the complaint (citations omitted). The fact that defendants expended time and expense in briefing their replies on their motions to dismiss the original complaint and preparing for oral argument is not the kind of prejudice required to defeat an amendment (citation omitted).”).

CPLR 3025(b) - Proposed amendments were palpably insufficient

CPLR 3043 - Bill of particulars in personal injury actions

CPLR 3043(b) - Supplemental Bill of Particulars – Continuing consequences of injuries

Khosrova v. Hampton Bays Union Free Sch. Dist., 151 A.D.3d 953, 54 N.Y.S.3d 164 (2d Dep’t 2017) (“Here, the plaintiffs sought to allege continuing consequences of the injuries suffered and described in the original bill of particulars, rather than new and unrelated injuries (citations omitted). Since the contested bill of particulars is a supplemental bill of particulars, rather than an amended bill of particulars, and was served more than 30 days prior to trial, leave of court was not required (citations omitted). Accordingly, that branch of the defendant’s motion which was to strike the supplemental bill of particulars should have been denied and that branch of the plaintiffs’ cross motion which was to compel the defendant to accept their supplemental bill of particulars should have been granted.

ARTICLE 31 - DISCLOSURE

CPLR 3101- Scope of disclosure

CPLR 3101

David L. Ferstendig, Disputes Over Scope of Social Media Discovery Are Governed by Well- Established Discovery Rules, 688 N.Y.S.L.D. 1 (2018)

Disputes Over Scope of Social Media Discovery Are Governed by Well-Established Discovery Rules

Court of Appeals Rejects Appellate Division’s Heightened Standard

In Forman v. Henkin, 2018 N.Y. Slip Op. 01015 (February 13, 2018), the plaintiff alleged that she sustained physical and cognitive injuries limiting her ability to participate in recreational and social activities as a result of her fall from a horse owned by the defendant. The plaintiff testified at her deposition that prior to the accident she had posted to a Facebook account numerous photographs depicting her active lifestyle, but deactivated the account some six months after the accident.

The defendant sought an unlimited authorization to obtain the plaintiff’s Facebook account, including her private postings. The defendant argued that these materials were relevant to plaintiff’s injuries, her credibility, and her claims that she could no longer perform certain activities. The plaintiff failed to provide the authorization.

The trial court granted the defendant’s motion to compel, but only to the extent of directing the plaintiff to produce all privately posted photographs prior to the accident that she intended to introduce at trial, all photographs of herself privately posted after the accident that did not show nudity or romantic encounters, and an authorization for Facebook records showing every time after the accident that the plaintiff posted a private message and the number of characters or words in the messages.

Only the plaintiff appealed to the Appellate Division, which modified the trial court’s order. It limited disclosure to posted photos (whether before or after the accident) that the plaintiff intended to introduce at trial and eliminated the authorization to obtain post-accident message information.

The Court of Appeals reversed. It stated that disclosure in all civil actions is governed by the "material and necessary" standard enunciated by CPLR 3101(a), which requires that the discovery sought be relevant to the prosecution or defense of an action. Significantly, "[w]hile Facebook — and sites like it — offer relatively new means of sharing information with others, there is nothing so novel about Facebook materials that precludes application of New York’s long-standing disclosure rules to resolve this dispute." Id. at ∗3. The Court rejected the Appellate Division’s heightened standard for the production of social media, which required the defendant to establish "‘a factual predicate for their request by identifying relevant information in plaintiff’s Facebook account — that is, information that contradicts or conflicts with plaintiff’s alleged restrictions,

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. disabilities, and losses, and other claims’ (citation omitted)." Id. In fact, some courts had only permitted discovery of information in the private portion of a Facebook account where the party seeking discovery first established that material in the "public" portion contradicted the plaintiff’s allegations.

The Court found that such a threshold rule would permit the account holder to obstruct discovery "by manipulating ‘privacy’ settings or curating the materials on the public portion of the account." Id. The Court stressed that New York law does not condition the receipt of discovery on a showing that the items sought actually existed.

[R]ather, the request need only be appropriately tailored and reasonably calculated to yield relevant information. Indeed, as the name suggests, the purpose of discovery is to determine if material relevant to a claim or defense exists. In many if not most instances, a party seeking disclosure will not be able to demonstrate that items it has not yet obtained contain material evidence. Thus, we reject the notion that the account holder’s so-called "privacy" settings govern the scope of disclosure of social media materials.

Id. at ∗4.

The Court acknowledged that the mere commencement of a personal injury action does not automatically render a party’s entire Facebook account discoverable. In fact, discovery in the social media context is governed by "well-established" rules, that is, first to determine whether relevant information is likely to be found on Facebook. Then, the Court should tailor the order

to the particular controversy that identifies the types of materials that must be disclosed while avoiding disclosure of nonrelevant materials. In a personal injury case such as this it is appropriate to consider the nature of the underlying incident and the injuries claimed and to craft a rule for discovering information specific to each. Temporal limitations may also be appropriate — for example, the court should consider whether photographs or messages posted years before an accident are likely to be germane to the litigation. Moreover, to the extent the account may contain sensitive or embarrassing materials of marginal relevance, the account holder can seek protection from the court (see CPLR 3103[a]).

Id.

In this action, the Court held that the defendant "more than met" his burden:

At her deposition, plaintiff indicated that, during the period prior to the accident, she posted "a lot" of photographs showing her active lifestyle. Likewise, given plaintiff’s acknowledged tendency to post photographs representative of her activities on Facebook, there was a basis to infer that photographs she posted after the accident might be reflective of her post-accident activities and/or limitations. The request for these photographs was reasonably calculated to yield evidence

relevant to plaintiff’s assertion that she could no longer engage in the activities she enjoyed before the accident and that she had become reclusive….

In addition, it was reasonably likely that the data revealing the timing and number of characters in posted messages would be relevant to plaintiffs’ claim that she suffered cognitive injuries that caused her to have difficulty writing and using the computer, particularly her claim that she is painstakingly slow in crafting messages.

Id. at ∗5.

Thus, the Court reversed the Appellate Division order and reinstated the trial court’s order.

CPLR 3101

David L. Ferstendig, Freedom of Information Law Exempts From Disclosure Records Relating to Municipalities’ Plans for Auditing Special Education Preschool Provider Costs, 685 N.Y.S.L.D. 2-3 (2017)

Freedom of Information Law Exempts From Disclosure Records Relating to Municipalities’ Plans for Auditing Special Education Preschool Provider Costs

Court Finds Records Were Compiled for “Law Enforcement” Purposes, Which Includes Civil Enforcement

New York State’s Freedom of Information Law (FOIL) generally requires government agencies to provide access to public documents and records, subject to certain exemptions. In Matter of Madeiros v. New York State Educ. Dep’t, 30 N.Y.3d 67 (2017), the relevant exemptions were contained in Public Officers Law § 87(2)(e) (POL), denying public access to records “compiled for law enforcement purposes and which, if disclosed,” would: (i) “interfere with law enforcement investigations or judicial proceedings” or (iv) “reveal criminal investigative techniques or procedures, except routine techniques and procedures.” Id. at 73. School district boards are required to provide disabled preschool-age children with special education services and programs. Many times, these programs are offered by approved private providers, and the tuition charged is set by the New York State Education Department (Department). Municipalities are then reimbursed by the State for a statutory percentage of the costs paid to the providers. The State Comptroller had carried out a series of audits of approved special education programs, which uncovered widespread fraud and abuse in the reporting of allowed costs. Several criminal prosecutions and professional disciplinary investigations ensued. As a result, Education Law § 4410 was amended to try to increase fiscal oversight. Petitioner then made a FOIL request seeking

any and all [Education Law § 4410(11)(c) and 8 NYCRR 200.18] audit standards in [the Department’s] possession, including any audit program and audit plan submitted by a municipality or school district . . . , whether approved, not approved, disapproved, pending or such other status.

Id. at 72.

The Department denied the request in its entirety, relying on the exemption under POL § 87(2)(e), and arguing that disclosure “‘would interfere with investigations of compliance with the provisions of the reimbursable cost manual and the preschool special education rate setting system.’” Id. Petitioner then brought this Article 78 proceeding, seeking to vacate the denial, and directing the Department to provide the records and requesting attorneys’ fees under POL § 89(4)(c). Before it answered the petition, the Department released 55 responsive, partially redacted pages. The Department then answered and sought dismissal of the petition. The trial court granted the petition only to the extent of requiring the Department to produce two previously redacted pages. The Appellate Division affirmed.

The Court of Appeals rejected the Department’s reliance on POL § 87(2)(e)(iv), concerning non- routine criminal investigative techniques, because in its denial of the FOIL request the Department did not refer to that particular exemption. Thus, the Court focused on the exemption in POL § 87(2)(e)(i), which requires that the records be compiled for law enforcement purposes and disclosure would interfere with law enforcement investigations or judicial proceedings.

With respect to the first requirement, the Court concluded that the records were compiled for law enforcement purposes. It found that the phrase “law enforcement purposes” is not limited to criminal enforcement, and includes civil enforcement. While the phrase is not defined in FOIL, for support the Court referred to Black’s Law Dictionary, which provides that the phrase “law enforcement” is “not limited to the enforcement of criminal laws”; two subdivisions of POL § 87(2)(e), expressly applying the exemptions to criminal matters only, which limitation would be unnecessary if “law enforcement” was limited to criminal matters; and the federal counterpart of FOIL, the Freedom of Information Act, where case law has interpreted the law enforcement exemption to include both civil and criminal law enforcement matters.

The Court stressed that while all audits do not necessarily serve “law enforcement purposes,” the audits here were not “routine”:

The statutory scheme of Education Law § 4410, as amended in 2013, and the Department’s regulations pertaining to municipal audit plans and audit programs, indicate that these audits are specifically targeted at ferreting out the improper and potentially illegal or fraudulent reporting of costs by preschool special education providers. The goal of the statutory and regulatory scheme and, in particular the 2013 amendments, is not only to ensure the establishment of an accurate tuition rate, but also to encourage compliance with the applicable reporting rules and curb existing fraud and abuse. Thus, the obvious inference arising from the statutory requirement that the Department issue guidelines for municipalities in conducting these audits, is that the legislature sought to increase the efficacy of audit procedures in an effort to strengthen enforcement measures. Under these circumstances, we conclude that the records sought by petitioner were compiled for law enforcement purposes (citation omitted).

Id. at 76–77.

With respect to the second requirement, the Court agreed with the courts below that the Department redactions were necessary to prevent interference with a law enforcement investigation. Specifically, releasing the information concerning the auditor’s specific methods and procedures in particular counties would permit violators to “evade detection by deliberately tailoring their conduct in anticipation of avenues of inquiry to be pursued by agency personnel.” Id. at 77.

The Court rejected petitioner’s argument that POL § 87(2)(e)(i) was inapplicable because there were no ongoing audits at the time the FOIL request was submitted:

While an agency may not rely on section 87(2)(e)(i) to refuse disclosure of records upon a wholly speculative claim of potential interference with an unspecified future investigation to which the documents may or may not be relevant, that is not the case here. Rather, the municipal audits of special education preschool providers were expressly encouraged by statute and were plainly contemplated in the near future (citation omitted).

Id.

Petitioner Substantially Prevailed Within the Meaning of Public Officers Law § 89(4)(c)

A subsidiary issue in Madeiros was whether petitioner was entitled to recover her attorneys’ fees under POL § 89(4) (c). That statute provides for an award of legal fees “where the petitioner ‘has substantially prevailed’ in the FOIL proceeding and the agency either lacked a reasonable basis for denying access to the requested records or ‘failed to respond to a request or appeal within the statutory time.’” Id. at 78.

The Appellate Division held that the petitioner had not substantially prevailed because the majority of the Department’s challenged redactions were appropriate. The Court of Appeals reversed on this issue. It noted that the Department did not make any disclosures, redacted or otherwise, until after the petitioner brought this proceeding, at which time the Department produced substantial unredacted FOIL disclosure. In holding that the petitioner met the statutory requirements, the Court stressed that to conclude otherwise

would be to permit agencies to circumvent section 89(4)(c) because “only a petitioner who fully litigated a matter to a successful conclusion could ever expect an award of counsel fees and a respondent whose position was meritless need never be concerned about the possible imposition of such an award so long as they ultimately settled a matter—however dilatorily.” We, therefore, must remit for Supreme Court to exercise its discretion in relation to petitioner’s fee request (citations omitted).

Id. at 79–80.

CPLR 3101(a) / 3107 - Deposition of non-party-defendant satisfied notice requirement by serving plaintiff’s counsel with its motion papers, which properly provided the circumstances or reasons requiring the deposition of that nonparty

Alumil Fabrication, Inc. v. F.A. Alpine Window Mfg. Corp., 151 A.D.3d 667, 53 N.Y.S.3d 554 (2d Dep’t 2017) (“The defendant satisfied the notice requirement by serving the plaintiff’s counsel with its motion papers, which properly provided the circumstances or reasons requiring the deposition of that nonparty (citation omitted). Furthermore, the defendant demonstrated that the deposition testimony was relevant to the defense of the action and to the prosecution of its counterclaim (citations omitted). In opposition to the defendant’s motion and in support of its cross motion for a protective order, the plaintiff failed to establish that the deposition testimony sought was irrelevant to this action. The plaintiff’s remaining contentions are without merit. Accordingly, the Supreme Court providently exercised its discretion when it, in effect, granted the defendant’s motion to compel the deposition of the nonparty witness and denied the plaintiff’s cross motion for a protective order.”).

CPLR 3101(a) / 3107 / 3120 - A claim for privilege cannot be asserted before witness appears to testify and is asked objectionable questions

CPLR 3101(b) / 4503 - Report was not a confidential communication, and any privilege was waived; thus, report was not protected by the attorney-client privilege.

NYAHSA Servs., Inc., Self-Insurance Trust v. People Care Inc., 155 A.D.3d 1208, 64 N.Y.S.3d 725 (3d Dep’t 2017) (“The record, including the report itself, reflects that WOH, defendant’s counsel, retained Towers, an independent claims consultant, to undertake a comprehensive claims review to include the trust’s reserve practices and Cool’s administration of claims of defendant’s employees, in order to resolve the parties’ impasse over defendant’s unpaid assessments. Towers

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. was given in-house access to Cool’s documents for this purpose in addition to supporting documentation already provided by Cool. To that end, defendant’s president sent a letter to Cool’s vice-president reflecting that the purpose of the consultant’s review of Cool’s records was to ‘facilitat[e] an intelligent conversation with [Cool’s] claims department,’ which Supreme Court aptly characterized as a ‘typical business purpose.’ Cool’s vice-president submitted an affidavit attesting that it was his understanding that the purpose of the consultant’s review was to verify the accuracy of the assessments billed to defendant, and that Towers assured him that it would discuss its findings with Cool; another Cool vice-president attested that Towers did share certain findings with Cool, including that it did not find any problems with inappropriate payment of claims by Cool. As Supreme Court correctly concluded, the report ‘does not include any legal advice, legal analysis or discussion of legal issues’ nor does it disclose confidences of defendant, and we further note that it was based almost exclusively on information provided by Cool and, as such, it is not a communication ‘of a legal character’ (citation omitted). Further, we discern no error in the court’s conclusion — after crediting the proof that defendant did not expect that the report would remain confidential and that the contents of the report were not, in fact, kept confidential — that the report was not a confidential communication, and that any privilege was waived (citation omitted). Thus, the report was not protected by the attorney-client privilege.”).

CPLR 3101(b) - “Reports prepared by insurance investigators, adjusters, or attorneys before the decision is made to pay or reject a claim are not privileged and are discoverable, even when those reports are mixed/multi-purpose reports, motivated in part by the potential for litigation with the insured.”

Advanced Chimney, Inc. v. Graziano, 153 A.D.3d 478, 60 N.Y.S.3d 210 (2d Dep’t 2017) (“‘[T]he payment or rejection of claims is a part of the regular business of an insurance company. Consequently, reports which aid it in the process of deciding [whether to pay or reject a claim] are made in the regular course of its business’ (citations omitted). Reports prepared by insurance investigators, adjusters, or attorneys before the decision is made to pay or reject a claim are not privileged and are discoverable, even when those reports are mixed/multi-purpose reports, motivated in part by the potential for litigation with the insured (citations omitted). Here, the Supreme Court properly compelled disclosure, as the material sought by GNY was prepared by KBR as part of Tudor’s investigation into the claim, and was not primarily and predominantly of a legal character (citations omitted). Nor was the file protected as the work product of KBR (citation omitted).”).

CPLR 3101 - Presumption of confidentiality attaching to grand jury proceedings

Williams v. City of Rochester, 151 A.D.3d 1698, 55 N.Y.S.3d 843 (4th Dep’t 2017) (“Plaintiff, who was decedent’s wife, commenced an action in federal court against defendants, the City, the City of Rochester Police Department, and two police officers, seeking damages based on allegations that defendants, inter alia, violated decedent’s constitutional rights and caused his wrongful death. Plaintiff subsequently moved in Supreme Court pursuant to CPLR 3101 (a) (4) for an order requiring that nonparty municipality County of Monroe (County) and its District Attorney’s Office disclose the testimony of any City employees who testified before the grand jury that investigated the shooting. The County appeals from an order granting plaintiff’s motion and

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. directing the County, upon being served with a judicial subpoena duces tecum issued pursuant to CPLR 2307, to ‘supply to the Court, to examine in-camera, for review and determination as to disclosure to counsel, the complete transcripts of each and every employee of the City of Rochester who testified at the Grand Jury presentation.’ We reverse. We agree with the County that plaintiff failed to ‘demonstrat[e] a compelling and particularized need for access’ ‘ to the grand jury materials (citations omitted). Such a showing must be made in order to overcome the ‘presumption of confidentiality [that] attaches to the record of [g]rand [j]ury proceedings’ (citations omitted), and is a prerequisite to the court’s exercise of its discretion in ‘balanc[ing] the public interest for disclosure against the public interest favoring secrecy’ (citations omitted). Here, plaintiff failed to establish that the discovery proceedings in federal court would not be sufficient to ascertain the facts and circumstances surrounding the shooting (citation omitted).”).

CPLR 3101[d] - Remanded for hearing regarding status of person, as to his role, to determine whether documents protected from disclosure

Venture v. Preferred Mut. Ins. Co., 153 A.D.3d 1155, 61 N.Y.S.3d 210 (1st Dep’t 2017) (“‘[T]he CPLR establishes three categories of protected materials, also supported by policy considerations - privileged matter, absolutely immune from discovery (citation omitted); attorney’s work product, also absolutely immune (citation omitted); and trial preparation materials, which are subject to disclosure only on a showing of substantial need and undue hardship in obtaining the substantial equivalent of the materials by other means CPLR 3101 [d][2]’ (citation omitted). ‘[I]n order for attorney-client communications to be privileged, the document must be primarily or predominantly a communication of a legal character’ (citation omitted). ‘[T]he burden of establishing any right to protection is on the party asserting it; the protection claimed must be narrowly construed; and its application must be consistent with the purposes underlying the immunity’ (citations omitted). ‘Reports of insurance investigators or adjusters, prepared during the processing of a claim, are discoverable as made in the regular course of the insurance company’s business’ (citation omitted). ‘Furthermore, attorney work product applies only to documents prepared by counsel acting as such, and to materials uniquely the product of a lawyer’s learning and professional skills, such as those reflecting an attorney’s legal research, analysis, conclusions, legal theory or strategy’ (citation omitted). ‘Documents prepared in the ordinary course of an insurance company’s investigation to determine whether to accept or reject coverage and to evaluate the extent of a claimant’s loss are not privileged and are, therefore, discoverable. In addition, such documents do not become privileged merely because an investigation was conducted by an attorney’ (citations omitted). On appeal, plaintiffs contend that Dodge was not acting in a legal capacity and, rather, performed the function of a claims investigator. Defendant claims that the investigation was solely performed by McGuire, and that Dodge’s role consisted of conducting EUOs and providing legal advice based thereon. It also states that all of the information requested by plaintiffs in their motion to renew was already provided to the court as part of the in camera review and, in that sense, was not new. Based on the record before us, we cannot determine Dodge’s true role in this matter. Accordingly, this matter is remanded in accordance with the decretal paragraph.”).

CPLR 3101(d) - Material prepared in anticipation of litigation – liability insurer’s file

Veltre v. Rainbow Convenience Store, Inc., 146 A.D.3d 416, 45 N.Y.S.3d 30 (1st Dep’t 2017) (“Contrary to defendant’s contention, plaintiffs made a demand for the entire claims file from defendant’s insurer by letter from their attorney, and obtained, over defendant’s objection, an order to disclose the file (see CPLR 3124). Nevertheless, the file is immune from discovery, because it was created by defendant’s liability insurer (citation omitted) and plaintiffs failed to demonstrate either that they could not otherwise obtain ‘a substantial equivalent’ of the material without undue hardship (citation omitted) or that defendant waived the privilege by relying upon the material in support of a defense (citation omitted).”).

CPLR 3101(d) - Late expert disclosure

Washington v. Trustees of The M.E. Church of Livingston Manor, 2018 NY Slip Op 04622 (3d Dep’t 2018) (“Supreme Court did not abuse its discretion in relying on plaintiff's expert affidavit. CPLR 3212 (b) provides that, ‘[w]here an expert affidavit is submitted in support of, or opposition to, a motion for summary judgment, the court shall not decline to consider the affidavit because an expert exchange pursuant to [CPLR 3101 (d) (1) (i)] was not furnished prior to the submission of the affidavit.’ Defendant contends that, regardless of this statute, the court erred in considering the affidavit because plaintiff violated both a November 2016 order directing plaintiff to serve expert discovery by a certain date and the Third Judicial District Expert Disclosure Rule — requiring an opposing party to file its expert disclosure, at the latest, within 60 days after the note of issue was filed, subject to preclusion of the expert unless the court directs otherwise. Because the court's November 2016 order and the note of issue are not included in the record, we cannot adequately review whether plaintiff actually violated the order or rule. In any event, Supreme Court was vested with broad discretion in addressing this expert disclosure issue (citations omitted), and we find no abuse of that discretion.”).

CPLR 3101(d) - In expert disclosure, plaintiff is required to differentiate and specify which allegations of negligence apply to each defendant, and to delete any alleged act of negligence that is not applicable to any particular defendant.

Kanaly v. DeMartino, 2018 NY Slip Op 04060 (3d Dep’t 2018) (“In any event, plaintiff's ‘undifferentiated aggregation of the claimed negligent acts and omissions of all defendants’ did not serve the purpose of either a bill of particulars or an expert disclosure (citation omitted). Plaintiff's expert disclosure did not serve its purpose or comply with the statute because it did not contain reasonable detail concerning each expert's opinion, considering that the disclosure essentially alleged the same acts of negligence as to each defendant, even though some of those allegations could not possibly apply to every defendant. The nature of the disclosure here ‘essentially tell[s] the defendants nothing about what they are supposed to be defending’ (citation omitted). It is unfair to require one defendant to prepare to defend against allegations that plaintiff only intends to assert against the codefendants. Instead of a blended aggregation of claims, as plaintiff provided, each defendant was entitled to a disclosure specific to him, her or it (citations omitted). Thus, Supreme Court did not abuse its discretion by requiring plaintiff to revise her expert disclosure to differentiate and specify which allegations of negligence apply to each

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. defendant, and to delete any alleged act of negligence that is not applicable to any particular defendant.”).

CPLR 3101(d) - Conflict as to whether responding party in medical, dental or podiatric malpractice action can withhold expert’s qualifications for fear of revealing expert’s identity

The omission of the identity of the proposed expert in medical, dental and podiatric malpractice actions was apparently motivated by a concern that medical experts could be discouraged by colleagues from testifying. One of the concerns raised is that a party’s compliance with the required disclosure, other than the identity of the expert (that is, providing the expert’s qualifications), would permit the demanding party, with access to a computer and appropriate search engines, to learn the identity of the expert. This has provoked parties to request that they be permitted to limit their disclosure of the expert’s qualifications. The result has been a conflict in the Appellate Division Departments, with respect to their responses to this dilemma. The Second Department, joined recently by the Third Department, has ruled that

parties in medical malpractice cases “will ordinarily be entitled to full disclosure of the qualifications of [an opponent’s] expert, [except for the expert’s name,] notwithstanding that such disclosure may permit such expert’s identification,” but a party may obtain a protective order under CPLR 3103 (a) by making a factual showing that there exists a reasonable probability, “under the special circumstances of a particular case, that a prospective expert medical witness would be subjected to intimidation or threats if his or her name were revealed before trial” (citation omitted). Stated otherwise, parties “in medical malpractice actions are presumptively entitled to a statement of the [opponents’] expert’s qualifications in ‘reasonable detail’ (citation omitted), as the statute commands, and [parties opposing disclosure] in such cases may avoid compliance with this obligation only upon production of proof sufficient to sustain findings (a) that there is a reasonable probability that such compliance would lead to the disclosure of the actual identity of their expert or experts, and (b) that there is a reasonable probability that such disclosure would cause such expert or experts to be subjected to ‘unreasonable annoyance, expense, embarrassment, disadvantage, or other prejudice’ (citation omitted)” (citation omitted).

Kanaly v. DeMartino, 2018 N.Y. App. Div. LEXIS 4018, 2018 NY Slip Op 04060 (3d Dep’t June 7, 2018) (quoting Thomas v. Alleyne, 302 A.D.2d 36, 752 N.Y.S.2d 362 (2d Dep’t 2002)) (which court originated this rule).

The Fourth Department has carved out its own rule, permitting a responding party to withhold information concerning the expert’s medical school education and the location of his or her internships, residencies and fellowships. Thompson v. Swiantek, 291 A.D.2d 884, 736 N.Y.S.2d 819 (4th Dep’t 2002).

CPLR 3101(d) - Late disclosure

Lasher v. Albany Mem. Hosp., 161 A.D.3d 1326 (3d Dep’t 2018) (“Here, plaintiffs first notified defendants of their intention to call a GIS expert more than three years after defendants' respective demands for expert disclosure and during the midst of the trial. Notably, Stark's cell phone number was provided to plaintiffs during a pretrial deposition more than a year and a half earlier and, thus, plaintiffs possessed the essential facts necessary to investigate the matter — and, if necessary, to retain an expert — long before trial. Plaintiffs' claim that they did not realize the significance of the calls, and thus the need to subpoena the phone records, until shortly before trial did not, as Supreme Court found, constitute good cause for the delay (citations omitted). Moreover, we agree with Supreme Court that, given the complex and technical issues presented by the proposed GIS testimony, the mid-trial disclosure of this expert would have prejudiced defendants (citations omitted). Under these circumstances, we cannot conclude that Supreme Court abused its discretion in precluding plaintiffs from offering the testimony of their GIS expert (citations omitted).”).

CPLR 3101(d) / 4515 - Frye and general acceptance

Dovberg v. Laubach, 154 A.D.3d 810, 63 N.Y.S.3d 417 (2d Dep’t 2017) (“‘The long-recognized rule of Frye v. United States [293 F. 1013] is that expert testimony based on scientific principles or procedures is admissible but only after a principle or procedure has “gained general acceptance” in its specified field’ (citations omitted). ‘[G]eneral acceptance does not necessarily mean that a majority of the scientists involved subscribe to the conclusion. Rather it means that those espousing the theory or opinion have followed generally accepted scientific principles and methodology in evaluating clinical data to reach their conclusions’ (citations omitted). General acceptance can be demonstrated through scientific or legal writings, judicial opinions, or expert opinions other than that of the proffered expert (citations omitted). The burden of proving general acceptance rests upon the party offering the disputed expert testimony (citations omitted). ‘Broad statements of general scientific acceptance, without accompanying support, are insufficient to meet the burden of establishing such acceptance’ (citation omitted). Furthermore, even if the proffered expert opinion is based on accepted methods, it must satisfy ‘the admissibility question applied to all evidence—whether there is a proper foundation—to determine whether the accepted methods were appropriately employed in a particular case’ (citation omitted). Here, the defendants did not sustain their burden of establishing that Bowles’s opinion that the force generated by the accident could not have caused the plaintiff’s knee injuries was based on generally accepted principles and methodologies (citations omitted), or that there was a proper foundation for the admission of that opinion (citation omitted). The expert disclosure notice simply stated that Bowles analyzed ‘the medical and engineering aspects of the accident.’ While the defendants cited to three works in opposition to the motion in limine, they did not identify the authors, years of publication, and contents of those works, or any explanation as to their relevance in evaluating the cause of knee injuries. Moreover, the defendants provided no description of the methodology Bowles utilized to determine the force of the accident, and the biomechanical engineering principles he relied upon in reaching his conclusion that the force generated by the accident could not have caused the plaintiff’s knees to come into contact with the vehicle dashboard. Under these circumstances, the Supreme Court should have granted the plaintiff’s motion to the extent of precluding Bowles from offering his opinion testimony that the force generated by the accident could not have caused the plaintiff’s knee injuries (citations omitted). Accordingly, we reverse the judgment and remit the matter to the Supreme Court, Suffolk County, for a new trial on the issue of damages.”).

CPLR 3101(d)(1) - Conflict among Appellate Division Departments as to whether treating physician who testifies at trial as expert must provide CPLR 3101(d)(1) expert disclosure

David L. Ferstendig, Another Conflict Among Appellate Division Departments, 680 N.Y.S.L.D. 4 (2017)

One of my pet peeves has been the relative abundance of circumstances in which the Appellate Division departments are in conflict on basic procedural issues. See, e.g., “The CPLR - A Practitioner’s Perspective,” remarks from the New York University School of Law March 2013 Symposium entitled “The CPLR at Fifty - Its Past, Present, and Future.” Because of the nature of the issues involved, many times discovery-related, the opportunity for the Court of Appeals “to clear things up” is not readily available. This leaves counsel in sometimes difficult positions, complicating practice.

Schmitt v. Oneonta City Sch. Dist., 2017 N.Y. Slip Op. 04527 (3d Dep’t June 8, 2017), involved the issue of whether a CPLR 3101(d)(1)(i) expert disclosure is required for a treating physician who is expected to testify as an expert at trial. The First, Second, and Fourth Departments do not have such a requirement, concluding that the disclosure of a doctor’s records and reports pursuant to CPLR 3121 and 22 N.Y.C.R.R. § 202.17 is sufficient. See Hamer v. City of New York, 106 A.D.3d 504, 509 (1st Dep’t 2013); Jing Xue Jiang v. Dollar Rent a Car, Inc., 91 A.D.3d 603, 604 (2d Dep’t 2012); Andrew v. Hurh, 34 A.D.3d 1331, 1331 (4th Dep’t 2006), lv. denied, 8 N.Y.3d 808 (2007). However, the Third Department does require a CPLR 3101(d)(1)(i) disclosure. In Schmitt, the defendant served a demand for expert disclosure, and plaintiffs’ multiple responses did not identify a medical expert. The plaintiffs noticed a deposition of the treating physician for trial purposes. During the deposition, the plaintiffs attempted to offer the witness as an “expert in the field of orthopedic surgery.” The defendant objected immediately because the witness was not identified in the plaintiffs’ expert disclosure. Plaintiffs’ counsel maintained that no expert disclosure was required and the deposition continued over defendant’s objection. The plaintiffs then moved, seeking a determination that they had “effectively complied” with CPLR 3101(d)(1)(i), or in the alternative, that the expert disclosure they had attached to their motion was sufficient. The trial court granted the motion “finding that a fair reading of [the expert] Cico-ria’s testimony provided defendant with Cicoria’s qualifications, as well as the facts and opinions upon which he could be expected to testify at trial.” Schmitt, 2017 N.Y. Slip Op. 04527 at ∗2.

On appeal, the Third Department reiterated its conflict with the other Departments requiring an expert disclosure for a treating physician. It found that the transcript of the deposition could not serve as a substitute for the CPLR 3101(d)(1)(i) disclosure. The majority opinion then tried to frame a proper remedy for the non-compliance. Significantly, it noted that “[p]laintiffs’ counsel candidly conceded that he was unaware of this Court’s interpretation of CPLR 3101(d)(1)(i) and the corresponding need to file an expert disclosure for a treating physician” (perhaps because of the conflict among the departments!). Id.

The court further noted that there was no showing of willfulness in the plaintiffs’ nondisclosure. However, it conceded that the defendant suffered prejudice. Thus, the court ruled that if the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. plaintiffs sought to call the witness as an expert, they would need to provide a complete CPLR 3101(d)(1)(i) disclosure and produce him for an expert deposition, at their expense. If the plaintiffs chose to use him as a fact witness only, however, then plaintiffs could either introduce the videotape deposition at trial (CPLR 3117(a)(4)), subject to any objections under CPLR 3115(a) or a CPLR 3103(a) protective order, or could call him as a witness at trial, in which case the prior deposition could be used for impeachment purposes only (CPLR 3117(a)(1)).

In a concurring opinion, Judge Lynch took a different approach as to a remedy - there would be no need for a CPLR 3101(d)(1)(i) disclosure. However, he opined that the plaintiffs should be bound by the format they selected, that is, the videotape deposition, and should not be allowed to call the witness at trial. Moreover, the defendant should be allowed to cross-examine the witness via a videotape deposition, at the plaintiffs’ expense.

CPLR 3101(d)(1) - “[D]efendant’s objections to that line of questioning were properly sustained inasmuch as defendant did not receive sufficient notice that the treating physician relied on his engineering background to support his opinions and conclusions about plaintiff’s injuries.”

Harris v. Campbell, 155 A.D.3d 1622 (4th Dep’t 2017) (“We address first plaintiffs’ contentions concerning the court’s allegedly erroneous rulings at trial that contributed to the jury’s verdict that plaintiff did not sustain a serious injury. Contrary to plaintiffs’ contention, the court properly limited the testimony of one of plaintiff’s treating physicians. ‘CPLR 3101 (d) (1) applies only to experts retained to give opinion testimony at trial, and not to treating physicians, other medical providers, or other fact witnesses’ (citation omitted). ‘Where . . . a plaintiff’s intended expert medical witness is a treating physician whose records and reports have been fully disclosed . . . , a failure to serve a CPLR 3101 (d) notice regarding that doctor does not warrant preclusion of that expert’s testimony on causation, since the defendant has sufficient notice of the proposed testimony to negate any claim of surprise or prejudice’ ‘(citation omitted). Here, one of plaintiff’s treating physicians did not provide any expert disclosure, and during trial he indicated that, in addition to being a medical doctor, he received a Ph.D. in biomechanical engineering and he often relies on his engineering background in his medical practice. Subsequently, that treating physician was asked some questions pertaining to biomechanics, and specifically was asked about the amount of force needed to cause a lumbar injury. We conclude that defendant’s objections to that line of questioning were properly sustained inasmuch as defendant did not receive sufficient notice that the treating physician relied on his engineering background to support his opinions and conclusions about plaintiff’s injuries (citation omitted). Indeed, plaintiffs made no attempt in response to defendant’s objections to point to any medical records or other documentation that would establish that defendant had such notice.”).

CPLR 3101(d)(1) - Objecting to inadequate expert disclosure

David L. Ferstendig, Plaintiff’s Motion at Trial Seeking to Preclude Defense Expert’s Testimony on Causation Denied as Untimely, 672 N.Y.S.L.D. 1-2 (2016).

Rivera v. Montefiore Medical Center, 2016 N.Y. Slip Op. 06854 (October 20, 2016), concerned the adequacy of a CPLR 3101(d) expert disclosure and the obligation to object timely to its content, and specifically to the lack of specification. Rivera was an action against the defendant-hospital arising out of the death of plaintiff’s son there. The decedent arrived at the hospital with symptoms of pneumonia, and died early the next morning. He had been admitted to an area of the hospital that did not have continuous monitoring of a patient’s vital signs. The autopsy report concluded that the cause of death was bronchopneumonia complicated by diabetes.

The defendant-hospital’s CPLR 3101(d) statement revealed, among other things, that its expert would testify “on the issue of causation” and “as to the possible causes of the decedent’s injuries and contributing factors.” Plaintiff did not object to the general nature of the disclosure, specifically relating to causation; instead, she objected that the statement failed to provide the dates of the expert’s medical residency. That objection was cured by the defendant.

The defendant-hospital’s treating physician testified at trial that decedent’s death was caused in part by pneumonia. On cross, however, he stated instead that it was caused by acute cardiac arrhythmia. Plaintiff’s expert agreed that the death was caused in part by pneumonia, but acknowledged that cardiac arrest was a possible cause. Plaintiff moved to preclude defendant’s expert testimony as to the possible cause of the decedent’s death on the ground that its CPLR 3101(d) disclosure gave no detail as to the possible cause. The trial court denied the application as untimely. The defense expert then testified that the cause of the decedent’s death was sudden, lethal cardiac arrhythmia, disputing the autopsy report suggested cause of death. The jury found the defendant liable for its failure to put the decedent in an area of the hospital where there was continuous monitoring. However, although the jury awarded damages for past and future economic losses, it rejected the conscious pain and suffering claim, suggesting that the jury believed the decedent died suddenly, perhaps caused by a heart ailment. The plaintiff then moved pursuant to CPLR 4404(a) to strike all testimony regarding cardiac arrhythmia as a cause of decedent’s death and to set aside the $0 award for conscious pain and suffering on the ground that the CPLR 3101(d) expert disclosure failed to include the theory as to cardiac arrhythmia and was thus deficient. The trial court denied the motion as “untimely made at the time of trial.”

The Appellate Division affirmed, holding that plaintiff did not timely object to the lack of specificity in defendant’s CPLR 3101(d) disclosure and the plaintiff could not assume that the defense expert would agree with the autopsy report’s conclusion as to the cause of death.

The Court of Appeals affirmed. The Court noted that the trial court had the discretion to deny plaintiff’s motion to preclude. Significantly, it rejected plaintiff’s argument that it had no reason to object to defendant’s CPLR 3101(d) statement at the time it was served because it did not indicate that the defendant would dispute plaintiff’s theory of the cause of decedent’s death. The Court stated that to the extent defendant’s CPLR 3101(d) disclosure might have been objectionable, its insufficiency was obvious. Thus, it was not misleading; it simply did not indicate a theory or basis for the expert’s opinion. The Court held that the trial court did not abuse its discretion in finding that the plaintiff’s time to object had passed, since “the basis of the objection was readily apparent from the face of the disclosure statement and could have been raised – and potentially cured – before trial.” Id. at *3.

This decision is both troubling and instructive. In most cases (outside of the Commercial Part), expert disclosure is limited to the CPLR 3101(d) written responses. The deposition of an expert is generally not permitted or taken. Not infrequently, the written disclosures can be generalized and lacking in detail. The Rivera decision is a cautionary tale and should provoke parties to review closely their opponent’s expert disclosure to assure that all objections are preserved in a timely fashion. Conversely, a party should make sure its disclosure is sufficiently detailed. The decision also highlights the danger of a system that generally limits the inquiry of a party’s expert by not permitting depositions and relying solely on a written response.

CPLR 3101(d)(1) - Adequacy of expert disclosure

Tate-Mitros v. MTA N.Y. City Tr., 144 A.D.3d 454, 41 N.Y.S.3d 214 (1st Dep’t 2016) (“We find that Dr. Kurtz’s CPLR 3101(d)(1) disclosure notice was legally sufficient; it provided plaintiff with notice that the doctor would question whether a bus would have caused the injuries sustained by plaintiff. It is improper for a party to request the facts and opinions upon which another party’s expert is expected to testify (citations omitted).”).

CPLR 3101(d)(1) - Adequacy of expert disclosure

Rocco v. Ahmed, 146 A.D.3d 836, 45 N.Y.S.3d 161 (2d Dep’t 2017) (“Here, Ahmed’s expert witness disclosure only revealed expert testimony that Rocco’s stroke was not caused by his atrial fibrillation or a blood clot, but did not inform the plaintiffs that the expert would testify that the stroke was caused by calcification. Ahmed failed to demonstrate good cause for not disclosing the substance of his expert’s causation theory until trial (citations omitted). The revelation of the defendants’ causation theory at trial prejudiced the plaintiffs’ ability to prepare for trial because they did not have adequate time to consult or retain an expert neuroradiologist (citations omitted).”).

CPLR 3101(d)(1) - No evidence that failure to disclose experts was intentional or willful and no showing of prejudice

Yampolskiy v. Baron, 150 A.D.3d 795, 53 N.Y.S.3d 677 (2d Dep’t 2017) (“‘[A] party’s failure to disclose its experts pursuant to CPLR 3101(d)(1)(i) prior to the filing of a note of issue and certificate of readiness does not divest a court of the discretion to consider an affirmation or affidavit submitted by that party’s experts in the context of a timely motion for summary judgment’ (citation omitted). Under the circumstances of this case, the Supreme Court properly denied the plaintiff’s cross motion to preclude the expert materials submitted by the defendants in support of their motion for summary judgment, as there was no evidence that the failure to disclose the experts was intentional or willful, and there was no showing of prejudice to the plaintiff (citations omitted).”).

CPLR 3101(i) - Plaintiff failed to properly authenticate the video excerpt

Torres v. Hickman, 2018 NY Slip Op 04372 (2d Dep’t 2018) (“The plaintiff moved to enter into evidence a 30-second portion of a surveillance video recording of the accident taken by a security camera at a business adjacent to the accident scene. A ‘tech supervisor’ employed by the business testified that he installed and maintained the security camera, but that he did not record the original video, nor did he copy the relevant portion of that video on to the disc that was proffered as evidence. He similarly did not know how the master recording was edited to produce the 30-second excerpt on the disc, and he did not testify that the excerpt was a true and accurate depiction of a portion of the master recording or that it depicted the entire recorded event in question. He also lacked any firsthand knowledge of who prepared the subject disc, or of how and when it was supplied to the plaintiff's attorneys. The Supreme Court precluded the video evidence, citing problems with its authentication and chain of custody. . . . Contrary to the plaintiff's contention, the Supreme Court providently exercised its discretion in precluding the proffered surveillance video excerpt. ‘Testimony from [a] videographer that he [or she] took the video, that it correctly reflects what he [or she] saw, and that it has not been altered or edited is normally sufficient to authenticate a videotape’ (citation omitted). Where the videographer is not called as a witness, the video can still be authenticated with testimony that the video ‘truly and accurately represents what was before the camera’ (citations omitted). Furthermore, ‘[e]vidence establishing the chain of custody of the videotape may additionally buttress its authenticity and integrity, and even allow for acceptable inferences of reasonable accuracy and freedom from tampering’ (citations omitted). Here, given the inability of the witness to testify regarding the editing of the master recording and the accuracy of the video excerpt, and his lack of personal knowledge as to the creation of the proffered disc and how it came into the possession of the plaintiff's attorneys, we agree with the court's determination that the plaintiff failed to properly authenticate the video excerpt (citation omitted).”).

CPLR 3104 - Supervision of disclosure

CPLR 3104 - Referee does not supervise bill of particulars dispute since it is not a disclosure device

Flores v. New York City Hous. Auth., 151 A.D.3d 695, 56 N.Y.S.3d 263 (2d Dep’t 2017) (“Since a bill of particulars is not a disclosure device but a means of amplifying a pleading (citation omitted), the present dispute over the contents of the plaintiff’s bill of particulars is not ‘part of any disclosure procedure’ (citation omitted) that CPLR 3104 authorizes a referee to supervise. Because CPLR 3104 did not authorize the J.H.O./Referee to determine the defendants’ motion to strike stated portions of the plaintiff’s bill of particulars, and there exists no order of reference authorizing the J.H.O./Referee to determine the motion, the J.H.O./Referee was without authority to determine the defendants’ motion. Further, contrary to the plaintiff’s contention, the question of whether the J.H.O./Referee lacked authority to determine the motion is properly before this Court. Under the circumstances, the defendants’ motion pursuant to CPLR 3104(d) to review and vacate the order dated July 6, 2015, should have been granted.”).

CPLR 3116 - Signing Deposition

CPLR 3116 - Substantive changes to errata sheet without providing sufficient explanation

Carrero v. New York City Hous. Auth., 2018 NY Slip Op 04660 (1st Dep’t 2018) (“Supreme Court correctly struck plaintiff's errata sheet purporting to correct the transcript of her General Municipal Law § 50-h hearing testimony, because plaintiff made numerous substantive changes to the testimony without providing a sufficient explanation for them (citations omitted).”).

CPLR 3116 / 2101(b) - Translator’s affidavit die not accompany errata sheets

Gonzalez v. Abreu, 2018 NY Slip Op 04309 (2d Dep’t 2018) (“Here, the defendant testified at her deposition through a Spanish language interpreter. However, the errata sheets annexed to the transcript of the defendant's deposition testimony and the defendant's affidavit, which were both written in English, were not accompanied by a translator's affidavit executed in compliance with CPLR 2101(b). Therefore, those evidentiary submissions were facially defective and inadmissible (citations omitted). While the defendant submitted a translator's affidavit with her reply papers, that affidavit was unnotarized, and thus was not in admissible form (citation omitted). The defendant's remaining evidentiary submissions were insufficient to establish her prima facie entitlement to judgment as a matter of law on the applicability of the homeowner's exemption under the Labor Law (citation omitted).”).

CPLR 3116 - Signing deposition transcript; plaintiff’s unsigned admissible because certified and because it was provided to plaintiff’s counsel more than 60 days prior to defendant’s motion; nonparty transcript not admissible because defendant did not mail until after motion

Tsai Chung Chao v. Chao, 161 A.D.3d 564 (1st Dep’t 2018) (“Plaintiff’s deposition transcript, which defendant submitted with his initial motion papers, is admissible, because, although it is unsigned, it is certified (citations omitted). In addition, defendant submitted evidence that his lawyer mailed the transcript to plaintiff’s counsel more than 60 days before the date of defendant’s motion. The transcript of the deposition of Hsian Fang Chao (not a party to this action) is not admissible, because defendant did not mail it until after the date of his motion (citations omitted).”).

CPLR 3116(a) - Admissibility of unsigned deposition transcripts

Gallway v. Muintir, LLC, 142 A.D.3d 948, 38 N.Y.S.3d 28 (2d Dep’t 2016) (“The plaintiff’s challenges to the admissibility of the defendants’ evidence are without merit. The plaintiff’s

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. unsigned deposition was admissible, since it was submitted by the plaintiff herself in opposition to the defendant’s motion, thus acknowledging its accuracy (citation omitted). Additionally, the defendants cured any defects in the admissibility of the deposition transcripts submitted in support of their motion by submitting, in reply, the reporter’s certification of those transcripts and the fact that the depositions were forwarded to the parties for review and signature (citations omitted).”).

Safier v. Saggio Rest. Inc., 151 A.D.3d 543, 54 N.Y.S.3d 272 (1st Dep’t 2017) (“These unsigned transcripts were properly before the motion court, because the deponents were served with notices to execute more than 60 days before Tri-State moved for summary judgment, every transcript was certified by a reporter, and neither plaintiff nor co-defendants challenged the accuracy of the testimony (citations omitted).”).

CPLR 3119 - Uniform interstate depositions and discovery

CPLR 3119 - Applies to out of state subpoena issued in connection with investigation by California Attorney General

Matter of Harris v. Seneca Promotions, Inc., 149 A.D.3d 1508, 53 N.Y.S.3d 758 (4th Dep’t 2017) (“Nevertheless, we agree with petitioner that CPLR 3119 applies to this out-of-state subpoena issued in connection with an investigation undertaken by petitioner as Attorney General of the State of California (citation omitted). Contrary to the contention of NWSC, nothing in the language of the statue limits its scope to subpoenas issued in civil litigation, and NWSC may not rely upon the title of the bill and statements of its sponsor to create ambiguity where the statutory language is clear and unambiguous. ‘Where words of a statute are free from ambiguity and express plainly, clearly and distinctly the legislative intent, resort may not be had to other means of interpretation’ . . . , and the intent of the Legislature must be discerned from the language of the statute . . . without resort to extrinsic material such as legislative history or memoranda’ (citation omitted). The record does not support NWSC’s contention that it was not afforded an opportunity to challenge the subpoena, inasmuch as the court considered NWSC’s position when it entertained NWSC’s application for a protective order pursuant to CPLR 3119 (e). We reject NWSC’s further contention that it had no obligation to specify the information that it sought to protect from disclosure in making that application. To the contrary, as the entity resisting compliance with the subpoena, NWSC had the burden of demonstrating that the information sought was irrelevant to petitioner’s investigation (citation omitted), and NWSC made no attempt to meet that burden.

CPLR 3121 - Physical or Mental Examination

CPLR 3121 - Trial court did not abuse discretion in ordering plaintiff to provide medical authorizations for a 10-year period

Kanaly v. DeMartino, 2018 NY Slip Op 04060 (3d Dep’t 2018) (“Supreme Court did not abuse its discretion in ordering plaintiff to provide unrestricted authorizations for defendants to obtain decedent's medical records for 10 years preceding her death. ‘[A] litigant is deemed to have waived

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the physician-patient privilege when, in bringing or defending a personal injury action, that person has affirmatively placed his or her mental or physical condition in issue’ (citation omitted). Plaintiff alleged that defendants committed medical malpractice by prescribing decedent fentanyl when she was opiate naive. The parties dispute the definition of that term, with a possible definition espoused by one of the defense experts requiring knowledge of the patient's medical history for at least a 10-year period prior to death. Defendants have noted that decedent suffered for many years from medical conditions for which pain medication would typically be prescribed. One medical record reveals that decedent received fentanyl — the drug alleged to have caused her death — for a surgical procedure in 2005. Additionally, plaintiff alleged that defendant Wendy Anne DeMartino was negligent for failing to read and use decedent's full medical history, and plaintiff's expert witness disclosure suggested that plaintiff's experts would rely on and testify to decedent's full medical history, but the disclosure did not delineate the extent or time period of that history. Inasmuch as plaintiff placed at issue decedent's full medical history for an extended but unspecified period of time, Supreme Court did not abuse its discretion in ordering plaintiff to provide medical authorizations for a 10-year period (citations omitted).”).

CPLR 3121 - Nonlegal representative’s presence at IME

Martinez v. Pinard, 160 A.D.3d 440, 71 N.Y.S.3d 345 (1st Dep’t 2018) (“Defendants concede that, under this Court's recent decision in Santana v Johnson (154 AD3d 452 [1st Dept 2017]), they can no longer argue that plaintiff was required to show ‘special and unusual circumstances’ to be permitted to have a nonlegal representative present at a physical examination conducted on their behalf pursuant to CPLR 3121. There is no basis for finding that defendants waived their right to conduct a physical examination of plaintiff by including unreasonable restrictions in their notice of examination. Defendants' conduct was supported by a good faith interpretation of applicable case law (citations omitted).”).

CPLR 3121(a) / 4504(a) - Placing medical condition in controversy waives privilege

O’Brien v. Village of Babylon, 153 A.D.3d 547, 60 N.Y.S.3d 92 (2d Dep’t 2017) (“‘While physician-patient communications are privileged under CPLR 4504, [a] litigant will be deemed to have waived the privilege when, in bringing or defending a personal injury action, that person has affirmatively placed his or her mental or physical condition in issue’ (citations omitted). To this end, ‘ a party must provide duly executed and acknowledged written authorizations for the release of pertinent medical records under the liberal discovery provisions of the CPLR (citation omitted) when that party has waived the physician-patient privilege by affirmatively putting his or her physical or mental condition in issue’ (citations omitted). ‘In addition, the defense is entitled to review records showing the nature and severity of the plaintiff’s prior medical conditions [which] may have an impact upon the amount of damages, if any, recoverable for a claim of loss of enjoyment of life’ (citations omitted). Here, contrary to the plaintiffs’ contention, they affirmatively placed the entire medical condition of the plaintiff Donald O’Brien (hereinafter the injured plaintiff) in controversy through the broad allegations in their bill of particulars (citation omitted). Further, the plaintiffs expressed their intention to prove exacerbation of preexisting injuries at trial and claimed damages for loss of enjoyment of life. Accordingly, the Supreme Court

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. properly granted that branch of the defendants’ cross motion which was pursuant to CPLR 3124 to compel the injured plaintiff to provide them with authorizations for the release of medical records relating to his treatment for acoustic neuroma and back issues (citations omitted). Under the circumstances of this case, the Supreme Court’s directive to provide medical authorizations as to these conditions, unrestricted as to date, was not an improvident exercise of discretion (citations omitted).”).

CPLR 3122 - Objections to disclosure, inspection or examination

CPLR 3122(a) - Provisions apply to subpoenas issued during the discovery phase of litigation, and are not applicable to the subpoena issued by respondents pursuant to its authority under State Finance Law § 9

Matter of The Plastic Surgery Group, P.C. v. Comptroller of The State of New York, 155 A.D.3d 1417 (3d Dep’t 2017) (“Supreme Court’s reliance upon CPLR 3122 (a) (2) as a limitation on respondent’s [health insurance claim] audit and subpoena authority is misplaced. CPLR 3122 (a) (2), which requires, among other things, that a patient’s written authorization accompany any subpoena duces tecum issued to a medical provider for that patient’s medical records, only applies, by its terms, to subpoenas issued by a party to litigation seeking discovery under CPLR 3120 or 3121, after an action or proceeding is commenced. The plain language of CPLR 3122 (a) (1) and (2), read together, makes clear that the provisions apply to subpoenas issued during the discovery phase of litigation, and are not applicable to the subpoena issued by respondent here pursuant to its authority under State Finance Law § 9 (citation omitted). Indeed, the conclusion urged by petitioner would lead to the untenable result that, unless health care providers voluntarily cooperate with respondent’s requests for access to patient records for audit purposes, respondent would be unable to fulfill its statutory and constitutional obligations to audit payments to providers for health insurance claims unless it obtained prior written authorization from all patients whose records were requested. Since respondent’s subpoenas are issued in accordance with its constitutional and statutory audit authority, and have no connection with discovery in an action or proceeding, the cited provisions of CPLR 3122 are not applicable.”).

CPLR 3122-a - Certification of business records

CPLR 3122-a - Failure to comply with section does not prevent party from objecting to document’s admissibility based on other rules of evidence

Karen E.A. v. 545 W. 146th St., Inc., 148 A.D.3d 464, 49 N.Y.S.3d 404 (1st Dep’t 2017) (“Defendant’s failure to comply with CPLR 3122-a did not prevent it from objecting to the report’s admissibility based on other rules of evidence (citation omitted). However, defendant’s objection that the plastic surgeon’s report was not admissible because it was prepared for the purpose of litigation and was not germane to diagnosis and the child’s treatment is not preserved for appellate review (citations omitted).”).

CPLR 3124 - Motion to compel disclosure

CPLR 3124 / 3126 - Ordering hearing to address conduct and determine penalty for discovery violation

On occasion, the Court can order a hearing to address the conduct and determine the penalty. CEMD El. Corp. v. Metrotech LLC I, 141 A.D.3d 451, 35 N.Y.S.3d 336 (1st Dep’t 2016) (“[T]he record makes clear that the facts surrounding defendant’s failure to appear for the deposition on March 24, 2014 are in dispute. According to affidavits submitted on defendant’s behalf, one from an employee of defendant and one from an executive vice-president at Douglas Elliman, plaintiff had affirmatively agreed to postpone depositions while the parties tried to discern, among other things, who had signed which agreements. Thus, under the circumstances presented here, a hearing is required to determine, among other things, whether defendant’s failure to attend the deposition was willful and contumacious (citations omitted). This conclusion holds particularly true in light of the strong preference in this state for deciding matters on the merits (citation omitted). Accordingly, we reverse and remit the matter for an evidentiary hearing.”).

CPLR 3126- Penalties for refusal to comply with order or to disclose

CPLR 3126 - Plaintiff acted with gross negligence in destroying ESI-tailored adverse inference charge ordered

Douglas Elliman LLC v. Tal, 156 A.D.3d 583, 65 N.Y.S.3d 697 (1st Dep’t 2017) (“The record demonstrates that plaintiff acted with gross negligence in destroying ESI not only after commencement of the action triggered a duty to preserve, but after defendant Tal’s deposition, in which she referenced an email exchange in which she allegedly advised plaintiff that she had started working at Itzhaki Properties, and requested dual licensure, which plaintiff approved (citation omitted). Accordingly, the court properly exercised its discretion in presuming the relevance of the email exchange and imposing spoliation sanctions (citation omitted). Further, the court engaged in “an appropriate balancing under the circumstances” by ordering a tailored adverse inference charge limited to the alleged contents of the email exchange regarding defendant’s Tal’s work at Itzhaki Properties, and precluding plaintiff from presenting contrary evidence (citation omitted).”).

CPLR 3126 - Loss of video was negligent rather than intentional, and loss did not completely deprive plaintiff of ability to prove her case; thus, sanction was adverse inference charge

Eksarko v. Associated Supermarket, 155 A.D.3d 826, 63 N.Y.S.3d 723 (2d Dep’t 2017) (“The plaintiff contends that Me-Me’s answer should be stricken for its spoliation of the video recording or, in the alternative, that an adverse inference charge should be given at trial with respect to the lost recording. Since Me-Me’s loss of the video recording was negligent rather than intentional, and the loss of the recording does not completely deprive the plaintiff of the ability to prove her case, the appropriate sanction is to direct that an adverse inference charge be given at trial with respect to the unavailable recording (citations omitted).”).

CPLR 3126 - Non-intentional or willful spoliation of physical evidence merits adverse inference charge and reimbursement of costs

Smith v. Cunningham, 154 A.D.3d 681, 62 N.Y.S.3d 434 (2d Dep’t 2017) (“Here, although the plaintiff demonstrated that the defendant hired contractors to alter and redo the plaintiff’s work, the plaintiff failed to demonstrate that the defendant’s conduct rose to the level of being intentional or willful (citations omitted). Nevertheless, it was undisputed that the evidence was relevant to the plaintiff’s claim (citation omitted). Under the circumstances of this case, the appropriate sanction was to give an adverse inference charge at trial against the defendant with respect to the spoliation of physical evidence (citations omitted). Likewise, to the extent the defendant appeals from so much of the order as directed him to reimburse the plaintiff the sum of $2,695, which the plaintiff had paid his expert to inspect the premises and issue a report, we find that this sanction was properly imposed.”).

CPLR 3126 - Willful and contumacious conduct merits striking pleadings

Rosengarten v. Born, 161 A.D.3d 515 (1st Dep’t 2018) (“The motion court’s decision to strike, based on a finding that defendants’ conduct with respect to its discovery obligations was willful and contumacious and without reasonable excuse, was a proper exercise of its discretion (citations omitted). The record amply demonstrates that from the start of the discovery process defendants engaged in a pattern of willful and contumacious conduct by, inter alia, disregarding court orders despite being repeatedly warned of the ramifications of doing so, providing discovery responses that were unduly burdensome and without reviewing them, and otherwise failing to meaningfully comply with the discovery requests.”).

CPLR 3126 - Striking answer for willful and contumacious conduct Schiller v. Sunharbor Acquisition I, LLC, 152 A.D.3d 812, 60 N.Y.S.3d 79 (2d Dep’t 2017) (“Here, the defendants’ repeated failures, over a period of years, to respond to the plaintiff’s discovery demands, even after being directed to do so by multiple court orders, without adequate excuses, constitutes willful and contumacious conduct (citations omitted). Moreover, in an April 2013 response by the defendants to the plaintiff’s demand for supplemental discovery, the defendants represented they were ‘not in possession of any electronically stored medical records,’ yet the affidavit submitted by the defendants in opposition to the motion to strike contended that the repeated failure to provide the complete medical record to the plaintiff arose from a malfunction with the computer system on which such medical records were stored. The defendants failed to provide an explanation for their initial false statement in the discovery response to the plaintiff.”).

CPLR 3126 - Striking answer and granting motion to dismiss cross-claims for willful and contumacious conduct Studer v. Newpointe Estates Condominium, 152 A.D.3d 555, 58 N.Y.S.3d 509 (2d Dep’t 2017) (“Contrary to the Newpointe defendants’ contention, the willful and contumacious nature of their

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. conduct may properly be inferred from their repeated delays in complying with the plaintiff’s discovery demands and the Supreme Court’s discovery schedule, their failure to provide an adequate excuse for their delays, and their inadequate discovery responses, which did not evince a good-faith effort to address the requests meaningfully (citations omitted). Further, the court properly considered the plaintiff’s evidence of accidents and complaints similar to hers, which she submitted for the first time in her reply papers, as this evidence was submitted in direct response to the Newpointe defendants’ opposition arguments (citations omitted). Contrary to the contentions of the Newpointe defendants, Witcomb Landscape also demonstrated that they willfully and contumaciously failed to comply with its discovery demands (citations omitted). Accordingly, the court providently exercised its discretion in granting that branch of the plaintiff’s motion which was to strike the Newpointe defendants’ answer and in granting Witcomb Landscape’s motion to dismiss the Newpointe defendants’ cross claims.”).

CPLR 3126 - Dismissal of cause of action for willful and contumacious conduct

Bruno v. Flip Cab Corp., 144 A.D.3d 852, 41 N.Y.S.3d 279 (2d Dep’t 2016) (“However, the Supreme Court improvidently exercised its discretion in granting that unopposed branch of Ingram’s motion which was pursuant to CPLR 3126 to dismiss the derivative cause of action for loss of services insofar as asserted against him only to the extent of precluding the plaintiff Jill M. Livoti from offering testimony at trial if she did not appear for a deposition within 30 days. ‘The drastic remedy of striking a pleading is warranted where the party’s failure to comply with court- ordered discovery is willful and contumacious’ (citations omitted). Here, Livoti twice failed to appear for depositions in violation of two court orders and never responded to a demand for a bill of particulars. Livoti’s failures to comply with court-ordered discovery coupled with her failure to provide any excuse therefor supports an inference that her conduct was willful and contumacious (citations omitted). Under the circumstances, Livoti’s derivative cause of action for loss of services should have been dismissed (citations omitted).”).

CPLR 3126 - Resolving issues of liability against offending party

Rogers v. Howard Realty Estates, Inc., 145 A.D.3d 1051, 42 N.Y.S.3d 866 (2d Dep’t 2016) (“Here, the defendant’s representative failed to appear for a court-ordered deposition on several separate dates. Moreover, the defendant failed to demonstrate a reasonable excuse for those failures (citations omitted). Under these circumstances, the Supreme Court providently exercised its discretion in deeming the issue of liability insofar as asserted against the defendant resolved in favor of the plaintiff (citations omitted).”).

CPLR 3126 - No proof that defendants intentionally or willfully destroyed evidence while under obligation to preserve

Atiles v. Golub Corp., 141 A.D.3d 1055, 36 N.Y.S.3d 533 (3d Dep’t 2016) (In personal injury slip and fall case, defendants produced video surveillance, including footage prior to, during, and after the accident but not for the full 24-hour period after the accident, as plaintiffs had requested. Court found that plaintiffs failed to prove defendants intentionally or willfully destroyed evidence while

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. under an obligation to preserve. Thus, plaintiff retained the burden to prove the relevancy of the missing video, which they could not do.).

CPLR 3126 - Conditional order of preclusion – opportunity to “cure”

Vaca v. Village View Hous. Corp., 145 A.D.3d 504, 43 N.Y.S.3d 42 (1st Dep’t 2016) (“The motion court providently exercised its discretion in issuing a conditional order striking the answer after defendants failed to comply with numerous orders directing them to provide discovery or an affidavit stating that a search had been conducted and the documents did not exist (citation omitted). An order striking the answer without giving defendants another opportunity to ‘cure’ their discovery deficiencies would have been inappropriate in light of plaintiff’s own discovery deficiencies and failure to provide a proper good-faith affirmation in compliance with 22 NYCRR 202.7 (citations omitted). However, the conditional order should provide that the motion is granted ‘unless”within a specified time the resisting party submits to the disclosure,”‘ and we modify solely to that effect (citations omitted).”).

CPLR 3126 - Conditional order and law office failure

Scholem v. Acadia Realty L.P., 144 A.D.3d 1012, 42 N.Y.S.3d 214 (2d Dep’t 2016) (“The plaintiff commenced this action against the defendant to recover damages for breach of contract. In an order dated January 9, 2013 (hereinafter the conditional order), the Supreme Court granted that branch of the plaintiff’s motion which was pursuant to CPLR 3126 to strike the defendant’s answer for, among other things, failing to produce witnesses for deposition “unless the defendant produces its witnesses for depositions, which shall be scheduled and conducted within 45 days after service of a copy of this order with notice of entry or any later date to which the parties agree in writing.” Pursuant to a so-ordered stipulation dated March 21, 2013 (hereinafter the so-ordered stipulation), the parties agreed that the defendant would produce certain witnesses for deposition on April 1, 2, and 3, 2013. It is undisputed that the defendant did not produce the witnesses on those dates. As a result, the conditional order became absolute (citations omitted). In order to be relieved of the adverse impact of the conditional order, the defendant was required to demonstrate a reasonable excuse for its failure to produce the witnesses for deposition and a potentially meritorious defense (citations omitted). The court has discretion to accept law office failure as a reasonable excuse (see CPLR 2005) where that claim is supported by a detailed and credible explanation of the default at issue (citations omitted). Here, in opposition to the plaintiff’s motion, inter alia, to enforce the conditional order and strike the defendant’s answer, the defendant submitted affidavits which, taken together, set forth a detailed and credible explanation for the failure to produce the witnesses for deposition (citation omitted), based on acts of misconduct and deception on the part of the associate attorney handling the matter for the defendant’s attorneys (citations omitted). Moreover, the defendant demonstrated the existence of a potentially meritorious defense.”).

CPLR 3126 - Dismissal of action is too harsh a penalty; conditional order is appropriate

Viruet v. Mount Sinai Med. Ctr. Inc., 143 A.D.3d 558, 38 N.Y.S.3d 896 (1st Dep’t 2016) (“Nevertheless, ‘[s]triking a party’s pleadings is a drastic sanction, and will generally be made only upon a clear showing that the party’s conduct was willful and contumacious’ (citations

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. omitted). The record shows that the 77-year-old plaintiff responded to many of defendants’ discovery demands, which were extensive, spanning 10 years of medical records and other documents. Under the circumstances of this medical malpractice case, dismissal of the action is too harsh a sanction at this point for plaintiff’s partial failure to comply with discovery orders (citation omitted). We, therefore, modify to reinstate the complaint, direct plaintiff within 45 days of this order to pay a monetary sanction in the amount of $1,500, and afford plaintiff a final opportunity to supplement her bill of particulars and to provide complete HIPAA authorizations (citation omitted).”).

CPLR 3126 - Spoliation – complaining party had ample opportunity to inspect and photograph subject elevator on day of the accident, never made request in the several months after accident to conduct further inspection, and has not identified any evidence it sought to obtain from such further inspection

Fajardo v. Mainco El. & Elec. Corp., 143 A.D.3d 759, 40 N.Y.S.3d 121 (2d Dep’t 2016) (“In cross-moving pursuant to CPLR 3126 to strike Bronx Center’s answer based upon spoliation of evidence, Mainco argued that Bronx Center did not permit it to complete its inspection of the elevator. ‘Under the common-law doctrine of spoliation, when a party negligently loses or intentionally destroys key evidence, the responsible party may be sanctioned under CPLR 3126’ (citations omitted). Here, the Supreme Court did not improvidently exercise its discretion in granting Mainco’s cross motion only to the extent of directing that the Bronx Center produce its expert for a deposition, since Mainco had ample opportunity to inspect and photograph the subject elevator on the day of the accident, never made a request in the several months after the accident to conduct a further inspection, and has not identified any evidence it sought to obtain from such further inspection (citation omitted).”).

CPLR 3126 - Trial court improvidently struck answer; adverse inference appropriate; ability to prove case not fatally compromised

Peters v. Hernandez, 142 A.D.3d 980, 37 N.Y.S.3d 443 (2d Dep’t 2016) (“Here, the Supreme Court improvidently exercised its discretion in imposing the sanction of striking the answer of the defendants MDC Tavern Corp., doing business as Carousel, Mark E. Carney, Dennis Charette, and Gregory Robert Walsh (hereinafter collectively the appellants). Although the plaintiff demonstrated that the appellants negligently disposed of the video recording of the underlying incident, his ability to prove his case without that recording was not fatally compromised (citations omitted). Under the circumstances of this case, the appropriate sanction is to direct that an adverse inference charge be issued at trial against the appellants with respect to the unavailable recording (citations omitted).”).

CPLR 3126 - Negligent destruction of electronic data results in negative inference sanction

Cioffi v. S.M. Foods, Inc., 142 A.D.3d 520, 36 N.Y.S.3d 475 (2d Dep’t 2016) (“Here, the record supports the Supreme Court’s conclusion that, at the time the Atlanta defendants destroyed the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. electronic data at issue, they were parties to this litigation and knew or should have known of the potential relevance of the data to the plaintiffs’ claims. Nevertheless, the plaintiffs have not demonstrated that the Atlanta defendants’ destruction of the data was willful rather than merely negligent. In addition, the plaintiffs have not demonstrated that the destruction of the data has significantly affected their ability to prove their claims. Accordingly, the Supreme Court providently exercised its discretion in declining to strike the Atlanta defendants’ answer or preclude them from presenting evidence (citation omitted). However, contrary to the Atlanta defendants’ contention, since they knew or should have known that the data should have been preserved, the imposition of the lesser sanction of a negative inference was appropriate. Therefore, the court properly granted that branch of the plaintiffs’ motion which was to impose a sanction against the Atlanta defendants to the extent of directing that a negative inference charge be given against them at trial.”).

CPLR 3126 - Trial court abused its discretion in dismissing the complaint due to plaintiff's belated disclosure of a video

Fox v. Grand Slam Banquet Hall, 142 A.D.3d 473, 36 N.Y.S.3d 653 (1st Dep’t 2016) (“There was no court order directing plaintiff to produce the video, and Grand Slam’s discovery demands only requested that she produce photographs. Furthermore, plaintiff, who claimed to have misplaced the video, did not seek to introduce the edited video, which did not show her fall, into evidence at trial, and was willing to consent to its preclusion, the striking of her testimony concerning its existence, and a curative instruction, even though she believed the video to be favorable to her because it showed a cord across the floor and one of Grand Slam’s principals standing in the vicinity. To mitigate any potential prejudice to Grand Slam resulting from the belated production or the potential use of the video at retrial, we direct that Grand Slam be given 60 days from the date of this order to conduct additional discovery of the videographer and plaintiff with respect to the video, as it deems appropriate. Because we are reversing the dismissal of the complaint, the high-low agreement should be enforced upon the retrial.”).

CPLR 3126 - The trial court abused its discretion in striking defendants’ answer and granting plaintiff partial summary judgment on liability based on defendants’ destruction of stairway. Instead, appropriate sanction is adverse inference charge

Burke v. Queen of Heaven R.C. Elementary Sch., 151 A.D.3d 1608, 58 N.Y.S.3d 757 (4th Dep’t 2017) (“Defendants concede that the original condition of the stairway was relevant. Furthermore, an obligation to preserve the condition of the stairs existed because litigation had begun at the time the stairs were replaced (citations omitted). We agree with plaintiff that she met her burden of establishing that defendants destroyed the stairs with a culpable state of mind. As Supreme Court properly concluded, defendants’ culpable state of mind was evidenced by their destruction of the stairs during the parties’ ongoing debate about whether plaintiff had to disclose the name of her expert to defendants before defendants would agree to the inspection (citations omitted). We thus agree with plaintiff that the imposition of a sanction against defendant for spoliation of evidence was warranted here (citation omitted). Nevertheless, we conclude that the court abused its discretion in striking defendants’ answer and granting plaintiff partial summary judgment on

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. liability based on defendants’ destruction of the stairway (citation omitted)…Here, the record does not demonstrate that plaintiff has been left ‘prejudicially bereft’ ‘of the means of prosecuting her action (citations omitted), given that plaintiff has in her possession, among other evidence of the condition of the stairs, photographs of the stairs taken after the commencement of this action. Thus, we conclude that an appropriate sanction is that an adverse inference charge be given at trial with respect to any now unavailable evidence of the condition of the stairs (citations omitted), and we modify the order accordingly.”).

CPLR 3126 - Adverse inference charge

Lilavois v. JP Morgan Chase & Co., 151 A.D.3d 711, 54 N.Y.S.3d 664 (2d Dep’t 2017) (“Here, contrary to the plaintiffs’ contention, the Supreme Court properly determined that the affidavit of Chase’s employee raised a triable issue of fact as to whether spoliation of the surveillance video occurred (citations omitted). Accordingly, the court providently exercised its discretion in granting that branch of the plaintiffs’ cross motion which was to strike Chase’s answer on the ground of spoliation of evidence only to the extent of directing that an adverse inference charge be given against Chase at trial with respect to surveillance video of the underlying incident if the jury does not credit testimony of Chase’s witness that no surveillance video existed for the subject location (citations omitted).”).

CPLR 3126 - Order of preclusion of testimony or evidence at trial concerning the injured plaintiff’s mental health

Patino v. Carlyle Three, LLC, 148 A.D.3d 1177, 50 N.Y.S.3d 481 (2d Dep’t 2017) (“A conditional order of preclusion requires a party to provide stated discovery by a date certain, or face the sanctions specified in the order (citations omitted). As a result of the plaintiffs’ failure to comply with the conditional order of preclusion dated July 10, 2014, that conditional order became absolute (citations omitted). To avoid the adverse impact of the conditional order of preclusion, the plaintiffs were required to demonstrate a reasonable excuse for their failure to comply with the order and a potentially meritorious cause of action (citations omitted). Here, the plaintiffs failed to proffer any excuse for their noncompliance and failed to demonstrate a potentially meritorious cause of action (citations omitted). Accordingly, the Supreme Court providently exercised its discretion in granting that branch of the defendants’ motion which was pursuant to CPLR 3126 to preclude the plaintiffs from offering testimony or evidence at trial concerning the injured plaintiff’s mental health.”).

CPLR 3126 - Order of preclusion of financial evidence

Douek v. Douek, 148 A.D.3d 866, 48 N.Y.S.3d 614 (2d Dep’t 2017) (“Contrary to the defendant’s contention, the Supreme Court did not improvidently exercise its discretion in granting that branch of the plaintiff’s motion which was pursuant to CPLR 3126 to preclude the defendant from offering financial evidence at trial due to her willful violation of discovery orders and her failure to comply with the plaintiff’s discovery requests (citations omitted).”).

CPLR 3126 - Penalty of striking pleading versus monetary sanction

Lucas v. Stam, 147 A.D.3d 921, 48 N.Y.S.3d 150 (2d Dep’t 2017) (Majority of court finds trial court improvidently exercised its discretion by imposing monetary sanctions on the defendants as opposed to striking their answers. “The Supreme Court properly inferred the willful and contumacious character of the defendants’ conduct from their repeated failures over an extended period of time, without an adequate excuse, to comply with the plaintiff’s discovery demands and the court’s discovery orders (citations omitted). This conduct included - (1) misrepresenting that the surgical booker Marcia Barnaby was no longer employed by the Hospital; (2) failing to disclose Anthony Pastor as a surgical booker; and (3) failing to timely and fully comply with the court’s order to produce an affidavit from Schiff in the form required by the court. ‘[P]arties, where necessary, will be held responsible for the failure of their lawyers to meet court- ordered deadlines and provide meaningful responses to discovery demands’ (citations omitted). … The striking of a pleading is a drastic remedy that may only be warranted upon a clear showing that the failure to comply with discovery demands or court-ordered discovery was willful and contumacious (citations omitted). Although not expressly set forth as a sanction under CPLR 3126, we have held that the imposition of a monetary sanction under CPLR 3126 may be appropriate to compensate counsel or a party for the time expended and costs incurred in connection with an offending party’s failure to fully and timely comply with court-ordered disclosure (citations omitted). Here, contrary to the Supreme Court’s determination, we find that the imposition of monetary sanctions was insufficient to punish the defendants and their counsel for their willful and contumacious conduct in failing to timely and fully respond to discovery demands and court orders. Accordingly, the court should have granted that branch of the plaintiff’s motion which was to strike the defendants’ answers.” The dissent, citing Weinstein, Korn & Miller, 3126.23, stated that dismissal is a harsh penalty to impose on a client as a result of an attorney’s failures. “and in certain cases, it may be appropriate to impose a penalty upon the attorney for his or her conduct while saving the action for the client (citations omitted).”).

CPLR 3126 - Striking justification defense

Crooke v. Bonofacio, 147 A.D.3d 510, 47 N.Y.S.3d 28 (1st Dep’t 2017) (“The court properly exercised its discretion under CPLR 3126 by striking St. Luke’s affirmative defense of justification because plaintiff demonstrated that the failure to produce defendant Michael Bonofacio, who was accused by plaintiff of misconduct, for his deposition, was willful, deliberate, contumacious, and done in bad faith (citation omitted). Moreover, St. Luke’s failed to provide a reasonable excuse for its failure to comply (citation omitted). The record shows that St. Luke’s repeatedly failed to respond to plaintiff’s inquiries about producing Bonofacio for deposition, and neglected to disclose — until well after the instant motion was filed — that it had terminated his employment causing him to refuse to appear. Furthermore, it is noted that the court made efforts to limit its order by striking only the affirmative defense that would require Bonofacio’s testimony. It did not strike the entire answer, thereby providing St. Luke’s with other avenues of defending against plaintiff’s claims. We note that courts are vested with broad discretion in fashioning remedies that are precisely tailored to the discovery abuse at issue (citation omitted), and find that the court herein crafted an appropriate remedy.”).

CPLR 3126 - Willful and contumacious conduct; but striking answer improvident exercise of discretion when trial court already precluded offending party from offering any evidence

Chowdhury v. Hudson Val. Limousine Serv., LLC, 2018 NY Slip Op 04526 (2d Dep’t 2018) (“In light of Koonin's failure to comply with multiple court orders and so-ordered stipulations directing him to appear for the EBT, the Supreme Court properly concluded that Koonin engaged in willful and contumacious conduct (citations omitted). However, under the circumstances, it was an improvident exercise of discretion to grant those branches of the motion and cross motion which were to strike Koonin's answer in light of the fact that the court also granted those branches of the motion and cross motion which were to preclude Koonin from offering any evidence at the time of trial (citations omitted).”).

CPLR 3126 - Failure to preserve surveillance footage merits negative inference charge

SM v. Plainedge Union Free Sch. Dist., 2018 NY Slip Op 04370 (2d Dep’t 2018) (“Here, the plaintiffs demonstrated that the defendant had an obligation to preserve surveillance footage of the moments leading up to the infant plaintiff's accident at the time of its destruction, but negligently failed to do so. Given the nature of the infant plaintiff's injuries and the immediate documentation and investigation into the cause of the accident by the defendant's employees, the defendant was clearly on notice of possible litigation and, thus, under an obligation to preserve any evidence that might be needed for future litigation (citations omitted). The defendant failed to meet this obligation. The defendant acted negligently in unilaterally deciding to preserve only 24 seconds of footage and passively permitting the destruction of the remaining footage, portions of which were undisputedly relevant to the plaintiffs' case. Under the circumstances of this case, the Supreme Court providently exercised its discretion in imposing a sanction of a negative inference charge against the defendant at trial with respect to the unavailable surveillance footage (citations omitted).”).

CPLR 3126 - Spoliation- Plaintiff failed to establish that defendant intentionally or negligently failed to preserve video after being placed on notice that the evidence might be needed for future litigation

Tanner v. Bethpage Union Free Sch. Dist., 161 A.D.3d 1210 (2d Dep’t 2018) (“‘Under the common-law doctrine of spoliation, when a party negligently loses or intentionally destroys key evidence, the responsible party may be sanctioned under CPLR 3126’ (citation omitted). ‘A party that seeks sanctions for spoliation of evidence must show that the party having control over the evidence possessed an obligation to preserve it at the time of its destruction, that the evidence was destroyed with a culpable state of mind, and that the destroyed evidence was relevant to the party’s claim or defense such that the trier of fact could find that the evidence would support that claim or defense’ (citations omitted). ‘[I]n the absence of pending litigation or notice of a specific claim, a defendant should not be sanctioned for discarding items in good faith and pursuant to its normal business practices’ (citations omitted). Here, the plaintiff failed to establish that the defendant intentionally or negligently failed to preserve the video after being placed on notice that the evidence might be needed for future litigation (citation omitted).”).

CPLR 3126 - Significant award of attorneys’ fees for willful and contumacious conduct

Jackson v. OpenCommunications Omnimedia, LLC, 147 A.D.3d 709, 49 N.Y.S.3d 389 (1st Dep’t 2017) (Affirming order awarding $40,994.80 in attorneys’ fees and costs associated with forensic examination of plaintiff’s laptop computer. “The court’s grant of relief under CPLR § 3126 was proper. Contrary to the court’s conclusion, we find that plaintiff’s pattern of noncompliance with discovery demands and a court-ordered stipulation supports an inference of willful and contumacious conduct, which further justifies imposition of sanctions (citations omitted). Here, a forensic examination of plaintiff’s laptop, which was conducted pursuant to a court-ordered stipulation entered into after plaintiff’s repeated refusals to produce all requested discovery, revealed numerous pages of documents that should have been turned over to defendants, as well as privileged attorney-client communications improperly accessed through defendant John Morris’ email account (citation omitted). Further, plaintiff failed to produce a flash drive, which he himself admitted existed at the time of his deposition, now claiming that the transcript of his testimony was inaccurate. We decline to reduce the amount of the award. Any challenge by plaintiff to the amount awarded has been waived, as he never objected to the proposed order and bill of costs submitted by defendants. His order to show cause sought only to reargue the order granting CPLR § 3126 relief, and did not dispute the specific amount of fees and costs sought by defendants. In any event, even if the order to show cause were deemed an objection, it was untimely, as plaintiff filed it less then two days prior to the notice date of defendants’ notice of settlement (citation omitted).”).

CPLR 3126 - Appellate court modifies trial court order striking answer and imposes costs instead

Woloszuk v. Logan-Young, 2018 NY Slip Op 04176 (4th Dep’t 2018) (“On the merits of the motion, although we agree with the court that plaintiff established that a discovery violation occurred, we conclude that the sanction of striking the answer of the Clinic was too severe under the circumstances of this case (citation omitted). This case is not similar to a spoliation case because the CAD structured reports were never destroyed but, rather, were not generated and produced in a timely manner (citation omitted). We conclude that the Clinic should be sanctioned by imposing costs upon it for any additional expenses plaintiff incurred as a result of the delay in disclosure (citation omitted). We therefore modify the order in appeal No. 3 by vacating that part of the first ordering paragraph striking the answer of the Clinic, and we modify the order in appeal No. 4 by vacating the third ordering paragraph and substituting therefor a provision directing the Clinic to reimburse plaintiff for expenses incurred as a result of the delayed disclosure of the CAD structured reports.”).

CPLR 3126 - Monetary sanctions

Vizcaino v. Western Beef, Inc., 161 A.D.3d 632 (1st Dep’t 2018) (“We see no reason to disturb the motion court’s exercise of discretion in declining to strike defendants’ answer (citation omitted). Defendants ultimately provided current contact information for the cashier who assisted plaintiff after her accident at their store, and explained their delay in providing this information as the result of a series of purported good faith mistakes. However, in view of the length of time it took and

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. multiple discovery motions and court orders for defendants finally to provide complete and accurate information, we find that monetary sanctions are warranted. An award of the costs of this motion and appeal is appropriate to compensate plaintiff for the extraordinary time and effort necessitated by defendants’ lack of diligence.”).

CPLR 3126 - Monetary sanction

Maxim, Inc. v. Feifer, 161 A.D.3d 551 (1st Dep’t 2018) (Compare Majority: “Here, a monetary sanction of $10,000 is warranted because plaintiffs, without seeking a protective order, intentionally did not produce documents and did not properly respond to a notice to admit based on an unfounded assertion that they feared defendants would make the documents public (citations omitted).”; and Dissent: “I dissent solely on the issue of the imposition of sanctions and would affirm the portion of the motion court’s order that denied defendant’s request, pursuant to CPLR 3126, for attorneys’ fees and expenses, ‘at this juncture of the litigation.’ ‘Although the determination of an appropriate sanction pursuant to CPLR 3126 lies in the trial court’s discretion and should not be set aside absent a clear abuse of discretion’ (citation omitted), I acknowledge that this Court is ‘vested with its own discretion and corresponding power to substitute its own discretion for that of the [motion] court’ (citation omitted). However, I do not believe that in this instance and on this record we should do so.”).

ARTICLE 32- ACCELERATED JUDGMENT

CPLR 3211- Motion to Dismiss

CPLR 3211 - Failure to timely serve claim deprived Court of Claims of subject matter jurisdiction

Steele v. State of New York, 145 A.D.3d 1363, 42 N.Y.S.3d 876 (3rd Dep’t 2016) (“This Court has determined that a claim for wrongful confinement accrues upon a claimant’s release from the SHU (citations omitted). On that measure, the claim was clearly untimely as the 90-day period in which to serve a claim expired on August 27, 2012. A failure to comply with the time provisions of Court of Claims Act § 10 divests the Court of Claims of subject matter jurisdiction (citations omitted). Statutorily, such a failure may be waived where the defense is neither raised in a pre-answer motion to dismiss or in the responsive pleading (see Court of Claims Act § 11 [c]). Here, as indicated, defendant duly preserved the defense in its answer (citation omitted). Since defendant has not otherwise waived its sovereign immunity, the court lacked authority to impose a pretrial motion deadline precluding this defense (citations omitted). As such, claimant’s failure to timely serve the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. claim deprived the Court of Claims of subject matter jurisdiction, and the claim must be dismissed.).

CPLR 3211 - Subject matter jurisdiction, forum selection clause and waiver of sovereign immunity

See Aron Sec., Inc. v. Unkechaug Indian Nation, 151 A.D.3d 674, 54 N.Y.S.3d 668 (2d Dep’t 2017) (Court grants motion to dismiss in subject matter jurisdiction grounds finding that forum selection provision did not express an unequivocal waiver of sovereign immunity by defendant Indian tribe.)

CPLR 3211 / 3212 - Single motion rule does not apply

Mew Equity, LLC v. Sutton Land Servs., LLC, 144 A.D.3d 874, 879, 42 N.Y.S.3d 175, 179 (2d Dep’t 2016) (“The court also failed to take into account that Marcy Tower and Chase moved for the alternative relief of having their motions treated as motions for summary judgment pursuant to CPLR 3211(c). The single motion rule did not preclude their requests for summary judgment (citations omitted).”).

CPLR 3211(a)(1) - Documentary evidence establishes a defense to plaintiff's claims as a matter of law

REEC W. 11th St. LLC v. 246 W. 11th St. Realty Corp., 75 N.Y.S.3d 32 (1st Dep’t 2018) (“The documentary evidence establishes a defense to plaintiff's claims as a matter of law (citations omitted). The complaint alleges that plaintiff worked diligently and in good faith to close title to the property that was the subject of the parties' contract of sale and that defendant breached the contract and the covenant of good faith and fair dealing by its unreasonable conduct. These allegations are utterly refuted by the contract of sale, the amendment to the contract, defendant's ‘Time Is of the Essence’ letter, and plaintiff's conduct in failing to close by any of the time of the essence dates.”).

CPLR 3211(a)(1) - What is “documentary evidence”?

Feldshteyn v. Brighton Beach 2012, LLC, 153 A.D.3d 670, 61 N.Y.S.3d 60 (2d Dep’t 2017) (“‘[J]udicial records, as well as documents reflecting out-of-court transactions such as mortgages, deeds, contracts, and any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence in the proper case’ (citations omitted). ‘At the same time, [n]either affidavits, deposition testimony, nor letters are considered documentary evidence within the intendment of CPLR 3211(a)’ (citations omitted). Here, the letters submitted by the defendant did not constitute documentary evidence within the meaning of CPLR 3211(a)(1), and should not have been relied upon by the Supreme Court as a basis for granting the defendant’s motion to dismiss the complaint. The only documentary evidence submitted in support of the defendant’s motion was the purchase agreement, which did not ‘utterly refute’ the plaintiffs’ allegations or conclusively establish a defense as a matter of law. Contrary to the defendant’s contention, the issue of whether the letters constitute documentary evidence within the intendment of CPLR

3211(a)(1) can be raised for the first time on appeal because it is one of law which appears on the face of the record and could not have been avoided if it had been raised at the proper juncture (citations omitted).”).

CPLR 3211(a)(1) - Documentary evidence conclusively established defense

413 Throop, LLC v. Triumph, the Church of the New Age, 153 A.D.3d 1306, 61 N.Y.S.3d 307 (2d Dep’t 2017) (“To prevail on a motion to dismiss a complaint pursuant to CPLR 3211(a)(1), a defendant must demonstrate that the proffered documentary evidence ‘utterly refutes plaintiff’s factual allegations, conclusively establishing a defense as a matter of law’ (citations omitted). An unambiguous contract provision may qualify as documentary evidence under CPLR 3211(a)(1) (citations omitted). Here, the Supreme Court properly determined that the defendant had conclusively established as a matter of law that the disputed provision in the contract clearly and unambiguously limited the purchaser’s remedy in the event of the defendant’s breach of the contract to the return of the down payment, and thus precluded specific performance or an award of damages. Accordingly, the court properly granted that branch of the defendant’s motion which was to dismiss the complaint pursuant to CPLR 3211(a)(1), and thereupon, properly directed cancellation of the notice of pendency (citations omitted).”).

CPLR 3211(a)(1) - Dismissal sought based on documentary evidence

Jenkins v. Jenkins, 145 A.D.3d 1231, 44 N.Y.S.3d 223 (3rd Dep’t 2016) (“[D]ismissal of a complaint under CPLR 3211 (a) (1) — the sole ground upon which Supreme Court granted defendant the requested relief here — ‘is appropriate where the documentary evidence utterly refutes the plaintiff’s . . . allegations, conclusively establishing a defense as a matter of law’ (citations omitted). In this regard, ‘it is clear that judicial records, as well as . . . any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence in the proper case’ (citations omitted).”).

CPLR 3211(a)(1) - Documentary evidence established a defense to plaintiff's claims as a matter of law

CPLR 3211(a)(1)/(a)(7) - Dismissal on grounds that defense is founded upon documentary evidence; the pleading fails to state a cause of action

Gorbatov v. Tsirelman, 155 A.D.3d 836, 65 N.Y.S.3d 71 (2d Dep’t 2017) (“The Supreme Court further should have granted those branches of the Kucherovsky defendants’ motion which were to dismiss the complaint insofar as asserted against the ‘Law Office of Leon Kucherovsky, P.C.,’ as they demonstrated that that entity does not exist (citation omitted) and insofar as asserted against Kucherovsky by Gorbatov individually. ‘Absent fraud, collusion, malicious acts, or other special circumstances, an attorney is not liable to third parties not in privity or near-privity for harm caused by professional negligence’ (citations omitted). Further, a Judiciary Law § 487 cause of action requires that the alleged deceit occurred during a judicial proceeding in which the plaintiff was a party (citations omitted). Here, the retainer agreements submitted by the Kucherovsky defendants conclusively established that Kucherovsky did not represent Gorbatov individually (citations omitted). Further, although the complaint alleges fraud and collusion, the damages alleged were incurred only by the clients represented by the defendants (citations omitted). Although Tsirelman submitted an affirmation stating that he only represented some of the plaintiffs, he did not submit any documentary evidence conclusively establishing that fact (citation omitted), and thus, the court properly declined to dismiss, at this juncture, the complaint against him insofar as asserted by any of the plaintiffs.”).

CPLR 3211(a)(3) / 3211(e) - Waiving standing objection

HSBC Bank USA, N.A.. v. Szoffer, 149 A.D.3d 1400, 52 N.Y.S.3d 721 (3rd Dep’t 2017) (“In opposition, defendants submitted an attorney’s affidavit, together with case law and proof of mortgage assignments that were unrelated to the property at issue, and argued that plaintiff lacked standing. However, the record makes clear — and defendants readily concede — that they failed to raise lack of standing in their answer or in the context of a timely pre-answer motion to dismiss, thereby waiving this defense (citations omitted). To the extent that defendants argue that Supreme Court could — and should — have raised this issue sua sponte and dismissed the underlying complaint, courts have been consistent in holding that ‘a party’s lack of standing does not constitute a jurisdictional defect and does not warrant a sua sponte dismissal of the complaint by the [trial] court’ (citations omitted). Finally, while defendants assert that, consistent with the provisions of CPLR 3025 (b), they could have sought leave to amend their answer to raise lack of standing as an affirmative defense, nothing in the record suggests that they attempted to do so. Indeed, it does not appear that defendants made any effort to raise this issue until confronted with plaintiff’s motion for summary judgment — some 5½ years after this action was commenced. Under these circumstances, defendants waived the affirmative defense of standing.”).

Perine Intl. Inc. v. Bedford Clothiers, Inc., 143 A.D.3d 491, 40 N.Y.S.3d 27 (1st Dep’t 2016) (“Defendants waived any defense based on a lack of capacity or standing to sue by failing to assert it in the answer or a pre-answer motion to dismiss (citations omitted). Even if the defense had not been waived, it would be unavailing because defendants admitted in their amended answer to having a contractual relationship with plaintiff (citations omitted).”).

Nationstar Mtge., LLC v. Avella, 142 A.D.3d 594, 36 N.Y.S.3d 679 (2d Dep’t 2016) (“Since the defendant did not timely answer the complaint or timely make a pre-answer motion to dismiss the complaint, she waived the defense of lack of standing (citations omitted). Prior to cross-moving, inter alia, to dismiss the complaint on the ground that the plaintiff lacked standing, the defendant

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. did not seek an extension of time to answer (see CPLR 3012[d]), or request an extension of time within which to serve and file a pre-answer motion pursuant to CPLR 3211 to dismiss the complaint.”).

CPLR 3211(a)(3) - Lack of capacity – dismissal under BCL § 1312(a)

G.P. Exports v. Tribeca Design, 147 A.D.3d 655, 46 N.Y.S.3d 881 (1st Dep’t 2017) (“Order, Supreme Court, New York County (Eileen A. Rakower, J.), entered March 28, 2016, which, insofar as appealed from as limited by the brief, denied, without prejudice, that portion of defendants Tribeca Design Ltd. and Tribeca Design Showroom LLC’s motion seeking to dismiss the complaint pursuant to Business Corporation Law § 1312(a) and CPLR 3211(a)(3) based upon lack of capacity to maintain the action, and directed plaintiff to comply with Business Corporation Law § 1312(a), unanimously reversed, on the law, without costs, and defendants’ motion denied in its entirety. Defendants failed to meet their burden of demonstrating that plaintiff was a foreign corporation and that its ‘activities [were] so systematic and regular as to manifest continuity of activity in New York’ that it was required to comply with Business Corporation law § 1312(a) (citations omitted). Evidence of a single business transaction is insufficient to establish that a foreign corporation is doing business in the State within the meaning of the statute (citation omitted). In addition, plaintiff alleges in its complaint that it is an Indian partnership, not a corporation. Defendant failed to prove otherwise.”).

CPLR 3211(a)(3)

David L. Ferstendig, Court Holds ELANY Lacks Capacity to Sue for Unpaid Stamping Fees, 684 N.Y.S.L.D. 1,2 (2017).

Court Holds ELANY Lacks Capacity to Sue for Unpaid Stamping Fees

The Statutory Structure, Legislative History, and ELANY’s Plan of Operation Suggest It Is a Record Keeper and Reporter, Not a Regulator When a New York-licensed insurer will not insure a particular risk, an insured may resort to foreign insurers not authorized to do business in the state. Excess line brokers place this type of excess line or surplus line insurance and are required to pay to the Department of Financial Services (DFS) any taxes due on excess line insurance premiums. In addition, they are to submit to the Excess Line Association of New York (ELANY) a document setting forth basic information for each brokered excess line policy and to pay it a “stamping fee” based on the policy’s premium.

ELANY is an “advisory” association created under Insurance Law § 2130(a), whose purpose is to facilitate compliance with excess line brokers’ filing and record-keeping requirements. All excess line licensees are deemed to be members of ELANY. ELANY is supervised by DFS and it is empowered to receive, record and stamp all excess line insurance documents filed by the brokers. The stamping fees are ELANY’s sole source of funding, and its plan of operation specifies that a member who is 30 days late in paying those fees may be reported to DFS, while a delinquency of more than 60 days shall be reported to DFS.

In Excess Line Assn. of N.Y. (ELANY) v. Waldorf & Assoc., 2017 N.Y. Slip Op. 07301 (October 19, 2017), the issue was whether ELANY could sue its members to recover stamping fees and to compel an examination and an accounting. The trial court granted defendants’ motion to dismiss, finding that ELANY lacked the capacity to sue. The Appellate Division affirmed, concluding that “[c]ontrary to ELANY’s contention, none of the provisions of the [ELANY enabling] statute confers upon it by necessary implication the capacity to sue to enforce the provisions of the Insurance Law.” Id. at ∗2 (citing to 130 A.D.3d 563, 565). A unanimous Court of Appeals affirmed. The Court initially noted that

“[c]apacity to sue is a threshold question involving the authority of a litigant to present a grievance for judicial review.” Capacity is examined with a view towards the relief sought, and is often at issue where, as here, governmental entities seek to bring suit. “Being artificial creatures of statute, such entities have neither an inherent nor a common-law right to sue. Rather, their right to sue, if it exists at all, must be derived from the relevant enabling legislation or some other concrete statutory predicate.” However, while the right must be derived from statute, “[a]n express grant of authority is not always necessary,” and “capacity may be inferred as a necessary implication from the powers and responsibilities of a governmental entity, ‘provided, of course, that there is no clear legislative intent negating review’” (citations omitted).

Id.

Here, the Court found that the relevant enabling statute did not expressly authorize ELANY to sue for the relief sought. Moreover, the legislative history did not reveal any “affirmative suggestion” that the legislature intended to give ELANY the capacity to sue. In fact, the statutory scheme supported the conclusion that the legislature intended that DFS be the “primary enforcer” of the Insurance Law and applicable regulations. Thus, DFS is empowered to suspend or revoke licenses and can impose statutory monetary penalties which, if unpaid, can be enforced in a civil action.

Conversely, ELANY’s “principal role is to act as a record keeper for excess line transactions.” Id. at ∗3. The Court rejected ELANY’s argument that since it was empowered to receive the stamping fees, its right to sue for their recovery was a “necessary implication” from its responsibilities -

Critically, ELANY is both supervised by DFS and required to “perform its functions” pursuant to a plan of operation approved by DFS (Insurance Law § 2130). That plan expressly establishes a method of enforcing the payment of stamping fees — the relief that ELA-NY seeks here — by providing that, when such fees go unpaid, ELANY’s remedy is to report the matter to DFS. In other words, DFS has not authorized ELANY to seek recovery of unpaid stamping fees through a plenary action. Instead, the plan of operation — which governs the scope of ELANY’s authorized activities — limits ELANY’s remedy to reporting violations to DFS, further supporting the conclusion that ELANY does not have implied capacity to sue for the relief sought.

Id. at ∗3–4.

Finally, the legislative history for the enabling statute (creating ELANY) characterized ELANY not as a regulator but as an “advisory association” -

In short, the authority that ELANY urges this Court to recognize is negated by the nature of the responsibilities conferred upon ELANY, as established by the statutory structure, legislative history, and ELANY’s plan of operation. Therefore, the courts below correctly concluded that capacity to sue cannot be inferred here.

Id. at ∗4.

CPLR 3211(a)(4) - Another action pending

Cooper v. Thao, 2018 NY Slip Op 04697 (2d Dep’t 2018) (“‘Pursuant to CPLR 3211(a)(4), a court has broad discretion in determining whether an action should be dismissed based upon another pending action where there is a substantial identity of the parties, the two actions are sufficiently similar, and the relief sought is substantially the same’ (citations omitted). ‘The critical element is that both suits arise out of the same subject matter or series of alleged wrongs’ (citation omitted). Here, at the time the plaintiff commenced this action, there was a mortgage foreclosure action pending between the plaintiff and HSBC in the Supreme Court, Queens County. The relief sought in that action implicated the same issues raised by the plaintiff in this action. Thus, the Supreme Court providently exercised its discretion in granting that branch of the defendants' motion which was to dismiss the complaint insofar as asserted against HSBC.”).

Stewart Tit. Ins. Co. v. Wingate, Kearney & Cullen, 145 A.D.3d 462, 41 N.Y.S.3d 712 (1st Dep’t 2016) (“Two of the causes of action in the instant action are identical to the two causes of action asserted in the Kings County action, which has been reinstated on appeal (citations omitted). The third, brought pursuant to RPAPL 1501(4), arises out of the same facts as the other claims and asserts a closely related theory. Since in determining a motion to dismiss pursuant to CPLR 3211(a)(4), “it is inconsequential that different legal theories or claims were set forth in the two actions” (citation omitted), the motion court properly exercised its discretion in dismissing the instant action.”).

Seneca Specialty Ins. Co. v. T.B.D. Capital, LLC, 143 A.D.3d 971, 40 N.Y.S.3d 450 (2d Dep’t 2016) (“Here, there is substantial identity of the parties and the causes of action alleged in the Indiana action and this action (citations omitted). Further, the Indiana action was filed ‘first-in- time.’ In the context of a motion to dismiss pursuant to CPLR 3211(a)(4) on the ground of another action pending, generally the courts of this state follow the first-in-time rule, meaning that ‘the court which has first taken jurisdiction is the one in which the matter should be determined and it is a violation of the rules of comity to interfere’ (citations omitted). While certain special circumstances may warrant deviation from this rule (citation omitted), consideration of the relevant circumstances herein does not warrant reversal of the Supreme Court’s discretionary determination to apply the first-in-time rule (citations omitted)”).

CPLR 3211(a)(5) / 3019/ 5011 - The Court of Appeals holds that subsequent assertion in a state court action of a claim that constituted a compulsory counterclaim in an earlier federal action between the same parties was barred by the doctrine of res judicata

Paramount Pictures Corp. v. Allianz Risk Transfer AG, 31 N.Y.3d 64, 73 N.Y.S.3d 472, 96 N.E.3d 737 (2018) (Majority of Court holds claim not asserted in prior federal court action as (compulsory) counterclaim was barred in subsequent state action under doctrine of res judicata. Court finds that plaintiff’s claim in state court action based on covenant not to sue was sufficiently related to investors’ claim in the federal action. “Indeed, in its ruling, the district court reached issues that would likely prove dispositive to Paramount’s instant claim: the court noted that the waiver provision of the Subscription Agreement also contained ‘an agreement by the plaintiffs in no event to bring any claim’ — i.e., a covenant not to sue — and held that those provisions were ‘binding’ on the investors. This overlap of essential facts is exemplified most poignantly by Paramount’s offensive assertion of collateral estoppel in the instant case with respect to the district court’s factual and legal findings concerning the Subscription Agreement. At bottom, Paramount’s covenant not to sue claim is based on the ‘same transaction’ as the federal action (the Melrose investment); it involves much of the ‘same evidence’ (the Subscription Agreement and surrounding negotiations); and its essential facts (the scope and validity of the Subscription Agreement’s provisions) were present in the first action (citation omitted).”).

CPLR 3211(a)(5) - Res judicata

Corle v. Allstate Ins. Co., 2018 NY Slip Op 04135 (4th Dep’t 2018) (“Nevertheless, we conclude that defendant was not entitled to dismissal of the complaint under CPLR 3211 (a) (5) based on res judicata. Contrary to defendant's contention, we conclude that the failure of James to litigate the bad faith claim in the earlier Insurance Law § 3420 (a) (2) action does not bar litigation of that claim in the instant action. ‘Under the doctrine of res judicata, a party may not litigate a claim where a judgment on the merits exists from a prior action between the same parties involving the same subject matter. The rule applies not only to claims actually litigated but also to claims that could have been raised in the prior litigation . . . Additionally, under New York's transactional analysis approach to res judicata, once a claim is brought to a final conclusion, all other claims arising out of the same transaction or series of transactions are barred, even if based upon different theories or if seeking a different remedy’ (citations omitted). . . . We recognize that the First Department held otherwise on similar facts in Cirone v Tower Ins. Co. of N.Y. (citations omitted). To the extent that the First Department in Cirone concluded that an injured person/judgment creditor who commenced an action against the insurer pursuant to Insurance Law § 3420 (a) (2) had standing to assert a bad faith settlement practices claim in that action in the absence of an assignment from the insured, we disagree with that conclusion and decline to follow Cirone.”).

CPLR 3211(a)(5) / 5011 - Where a litigant's individual interests are affected by prior litigation in which he or she participated in a representative capacity, res judicata will apply to a subsequent action commenced in the individual's personal capacity

Seidenfeld v. Zaltz, 2018 NY Slip Op 04585 (2d Dep’t 2018) (“The doctrine of res judicata, or claim preclusion, provides that ‘a valid final judgment bars future actions between the same parties

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. on the same cause of action’ (citations omitted). In general, a judgment for or against a person in his or her representative capacity is not res judicata against that person in his or her personal capacity (citations omitted). However, where a litigant's individual interests are affected by prior litigation in which he or she participated in a representative capacity, res judicata will apply to a subsequent action commenced in the individual's personal capacity (citations omitted).”).

CPLR 3211(a)(5) / 5011 - Collateral estoppel

Li v. Peng, 161 A.D.3d 823, 76 N.Y.S.3d 230 (2d Dep’t 2018) (“‘As a matter of full faith and credit, review by the courts of this State is limited to determining whether the rendering court had jurisdiction, an inquiry which includes due process considerations’ (citation omitted). Here, however, Feng Li previously challenged the jurisdiction of the New Jersey court, and the New Jersey court found that it had jurisdiction over the fee dispute. As a result, the plaintiffs are barred from relitigating that issue in the Supreme Court (citations omitted). The Supreme Court properly determined that the judgment entered in the New Jersey action had conclusively disposed of all of the plaintiffs' claims and, therefore, the plaintiffs are collaterally estopped from maintaining the instant action(citation omitted).”).

Siemsen v. Mevorach, 160 A.D.3d 1004, 72 N.Y.S.3d 478 (2d Dep’t 2018) (“Moreover, we agree with the Supreme Court that the cause of action alleging breach of fiduciary duty was barred by the doctrine of collateral estoppel (citation omitted). The defendant established that the decisive issues in this action regarding her failure to exercise the right of election were necessarily decided in the prior guardianship proceeding, and the plaintiff failed to demonstrate that she did not have a full and fair opportunity to contest the prior determination (citations omitted).”).

CPLR 3211(a)(5) / 5011 - Election of Remedies

Luckie v. Northern Adult Day Health Care Ctr., 161 A.D.3d 845, 73 N.Y.S.3d 454 (2d Dep’t 2018) (“‘Pursuant to the election of remedies doctrine, the filing of a complaint with [the Division] precludes the commencement of an action in the Supreme Court asserting the same discriminatory acts’ (citations omitted). The election of remedies doctrine does not implicate the subject matter jurisdiction of the court, but rather deprives a plaintiff of a cause of action (citation omitted). Here, the plaintiff’s causes of action are based on the same allegedly discriminatory conduct asserted in the proceedings before the Division. Therefore, the plaintiff is barred from asserting those claims under the NYCHRL in this action (citations omitted).”).

CPLR 3211(a)(7)

David L. Ferstendig, Complaint Dismissed for Failure to Allege Damages for Out-of-Pocket Expenses, 679 N.Y.S.L.D. 3, 4 (2017).

The CPLR 3211(a)(7) motion to dismiss for failure to state a cause of action can address the sufficiency of the complaint or, in limited circumstances, can establish “conclusively” that the plaintiff has no cause of action.

The recent decision in Connaughton v. Chipotle Mexican Grill, Inc., , 2017 N.Y. Slip Op. 03445 (May 2, 2017), dealt with the more traditional use of a CPLR 3211(a)(7) motion – that is, whether the pleading stated a cause of action and asserted all of the material elements of the claim. Here, the plaintiff, a well-known chef, sued the defendants Chipotle Mexican Grill and its Chief Executive Officer, Steven Ells. Plaintiff developed a business plan for a concept for a ramen restaurant chain, and approached Chipotle to tailor the ideas specifically for the Chipotle platform. Ells offered to purchase the concept, and the plaintiff, through counsel, negotiated an at-will contract to work as Culinary Director for Chipotle in New York to develop the restaurant design. Apparently, a significant amount of work was done over the next year and a half, and the plaintiff received the agreed-upon compensation and benefits. However, the plaintiff then learned that Ells had years before entered into a confidentiality agreement with another well-known chef, David Chang, to develop a similar ramen restaurant concept. That agreement fell apart, however, when the parties were unable to agree on financial terms. Yet, the non-disclosure provisions remained in effect, and a Chipotle executive stated that Chang would sue if Chipotle opened a ramen restaurant. Nevertheless, Ells told the plaintiff to continue with his work. When plaintiff refused, he was fired.

Plaintiff sued the defendants for, inter alia, fraudulent inducement, alleging that the defendants fraudulently induced him to work for them by failing to advise him of the earlier agreement with Chang and the nondisclosure agreement. Plaintiff asserted that he would never have accepted employment with the defendants had he known about the prior agreement; that the Chipotle staff communicated concepts that originally came from the prior chef, whose design ultimately became the defendants’ flagship ramen restaurant in Washington, D.C.; and that going forward would subject plaintiff to legal action. Plaintiff claimed damages for “the value of his Chipotle equity and lost business opportunities in connection with his ramen concept,” compensatory and punitive damages, and attorneys’ fees and disbursements. Id. at *3.

Defendants moved for dismissal under CPLR 3211(a)(1) and 3211(a)(7). As is relevant here, defendants argued that a fraudulent inducement claim can be pursued only where a party has suffered “out of pocket” pecuniary loss, not alleged here. The trial court granted the motion, and a divided Appellate Division affirmed.

The Court of Appeals also affirmed. It noted at the outset the fairly obvious, that if “the fraud causes no loss, then the plaintiff has suffered no damages.” Id. at *4. The question presented here related to the measure of damages. The Court stated that in New York, like many other states,

[t]he true measure of damage is indemnity for the actual pecuniary loss sustained as the direct result of the wrong or what is known as the “out-of-pocket” rule. Under that rule, “[d]amages are to be calculated to compensate plaintiffs for what they lost because of the fraud, not to compensate them for what they might have gained …. [T]here can be no recovery of profits which would have been realized in the absence of fraud.” Moreover, this Court has “consistent[ly] refus[ed] to allow damages for fraud based on the loss of a contractual bargain, the extent, and indeed … the very existence of which is completely undeterminable and speculative” (citations omitted).

Id.

Here, the complaint did not allege compensable damages resulting from the alleged fraud. While the complaint claimed that the plaintiff stopped soliciting potential buyers in reliance on defendants’ “fraudulent omissions,” nowhere did it allege that

he rejected another prospective buyer’s offer to purchase the concept. Instead, plaintiff avers that once Ells showed an interest in his ramen restaurant idea, plaintiff turned to selling the concept to Chipotle. These are factual assertions of the quintessential lost opportunity, which are not a recoverable out-of-pocket loss. As this Court has repeatedly stated, such damage is “disallowed as too speculative a recovery” (citations omitted).

Id. at *5.

Similarly speculative was plaintiff’s assertion that if he were to be sued by the prior chef, he could incur litigation expenses and loss of reputation. Furthermore, the complaint failed to provide factual support for its claim of reputational harm. Finally, the Court held that the plaintiff was not entitled to nominal damages, because they are unavailable when actual harm is an element of the tort, as is the case with a fraudulent inducement claim.

CPLR 3211(a)(7) - Defendants’ submissions did not conclusively establish that plaintiff had no cause of action

Phillips v. Taco Bell Corp., 152 A.D.3d 806, 60 N.Y.S.3d 67 (2d Dep’t 2017) (“On a motion pursuant to CPLR 3211(a)(7) to dismiss for failure to state a cause of action, the court must afford the pleading a liberal construction, accept all facts as alleged in the pleading to be true, accord the plaintiff the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory (citations omitted). Thus, ‘a motion to dismiss made pursuant to CPLR 3211 (a) (7) will fail if, taking all facts alleged as true and according them every possible inference favorable to the plaintiff, the complaint states in some recognizable form any cause of action known to our law’ (citation omitted). While a court is permitted to consider evidentiary material submitted by a defendant in support of a motion to dismiss pursuant to CPLR 3211(a)(7) (citation omitted), ‘affidavits submitted by a defendant will almost never warrant dismissal under CPLR 3211 unless they establish conclusively that [the plaintiff] has no cause of action’ (citations omitted). Here, the complaint stated a cause of action, and the defendants’ submissions did not conclusively establish that the plaintiff has no cause of action (citation omitted). Accordingly, the Supreme Court also properly denied that branch of the defendants’ motion which was pursuant to CPLR 3211(a)(7).”).

CPLR 3211(a)(7) - Pleading adequately alleged that the defendant acted with “actual malice” with respect to a defamation claim

Greenberg v. Spitzer, 2017 NY Slip Op 06432 (2d Dep’t 2017) (“Finally, viewing the allegations of the amended complaint as true, and according Greenberg the benefit of every favorable inference, the Supreme Court properly determined that the amended complaint adequately stated that Spitzer acted with actual malice (citations omitted). Specifically, the amended complaint alleged, inter alia, that the defamatory statements were made with malice, that Spitzer continued to publish them notwithstanding their falsity, and that he did so solely to discredit Greenberg and damage his reputation and career, while attempting to bolster Spitzer’s own reputation and career. Contrary to Spitzer’s contention, ‘the burden does not shift to the nonmoving party on a motion made pursuant to CPLR 3211(a)(7),’ and therefore, ‘a plaintiff has no obligation to show evidentiary facts to support [his or her] allegations of malice on a motion to dismiss pursuant to CPLR 3211(a)(7)’ (citations omitted).”).

CPLR 3211(a)(7) - Failure to state a cause of action- Facts essential to cause of action negated beyond substantial question by the evidentiary material submitted

Matter of Jonmark Corp. v. New York State Liq. Auth., 161 A.D.3d 1518, 73 N.Y.S.3d 920 (4th Dep’t 2018) (“We add only that, contrary to the contention of petitioner, the court did not err in granting Addys' pre-answer CPLR 3211 (a) (7) motion to dismiss the petition against it. Where ‘evidentiary material outside the pleading's four corners is considered, and the motion is not converted into one for summary judgment, the question becomes whether the pleader has a cause of action, not whether the pleader has stated one’ (citations omitted). Here, the facts essential to petitioner's causes of action have ‘been negated beyond substantial question by the [evidentiary material] submitted [with the petition] so that it might be ruled that [petitioner] does not have [a] cause[] of action’ (citation omitted).”).

CPLR 3211(a)(7) - Failure to conclusively establish that plaintiff had no cause of action

XXXX, L.P. v. 363 Prospect Place, LLC, 153 A.D.3d 588, 60 N.Y.S.3d 84 (2d Dep’t 2017) (“The Supreme Court also properly denied that branch of the defendants’ cross motion which was pursuant to CPLR 3211(a)(7) to dismiss the complaint. In considering a motion to dismiss pursuant to CPLR 3211(a)(7), the court must ‘accept the facts as alleged in the complaint as true, accord the plaintiffs the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory’ (citations omitted). ‘Where evidentiary material is submitted and considered on a motion to dismiss a complaint pursuant to CPLR 3211 (a)(7), and the motion is not converted into one for summary judgment, the question becomes whether the plaintiff has a cause of action, not whether the plaintiff has stated one and, unless it has been shown that a material fact as claimed by the plaintiff to be one is not a fact at all and unless it can be said that no significant dispute exists regarding it, dismissal should not eventuate’ (citations omitted). Here, the proffered evidence failed to conclusively establish that the plaintiff did not have a cause of action for an easement by necessity (citations omitted), an easement by preexisting use (citations omitted), or an easement by prescription (citations omitted).”).

CPLR 3211(c) / 3212 - Court did not provide adequate notice of its intention to convert the motions

Island Intellectual Prop. LLC v. Reich & Tang Deposit Solutions, LLC, 155 A.D.3d 542, 65 N.Y.S.3d 188 (1st Dep’t 2017) (“The motion court should not have entertained plaintiffs’ cross motion for summary judgment, as the parties did not chart a course for summary judgment (citation omitted). Defendants objected to the court entertaining the motion as one for summary judgment and the court did not provide adequate notice of its intention to convert the motions pursuant to CPLR 3211(c) (citation omitted).”).

CPLR 3211(e) - Waiver of service defense

Clermont v. Abdelrehim, 151 A.D.3d 495, 53 N.Y.S.3d 537 (1st Dep’t 2017) (“Le waived his lack of service defense by failing to timely move to dismiss, as required by CPLR 3211(e). If Le had never filed an answer, CPLR 3211(e) would not have been implicated and the failure to serve him would have rendered all subsequent proceedings null and void (citations omitted). Because he did, thereby appearing in the action, at least on a limited basis (citation omitted), he was bound to move to dismiss on the ground of lack of service within sixty days of asserting that defense in his answer (citations omitted).”).

CPLR 3211(e) - Waiver of service defense in failing to move within 60 days of serving answer; Jurisdiction defense also waived by asserting unrelated counterclaim; defendant cannot challenge court granting of extension to plaintiff to serve beyond 120 day period

JP Morgan Chase Bank, Natl. Assn. v. Venture, 148 A.D.3d 1269, 48 N.Y.S.3d 824 (3d Dep’t 2017) (“Supreme Court also properly denied defendant’s cross motion insofar as it sought dismissal of the complaint. Defendant waived his affirmative defense of lack of personal jurisdiction on the basis of improper service of process, as he failed to move to dismiss the complaint on that ground within 60 days after serving his answer (citations omitted). This defense was likewise waived by defendant’s assertion of a counterclaim unrelated to this action (citations omitted). In light of the foregoing, defendant also cannot challenge Supreme Court’s grant of plaintiff’s motion for an extension of time to serve defendant with process beyond the 120-day period provided for in CPLR 306-b, nunc pro tunc (citation omitted).”).

CPLR 3211(e) - Failure to move to dismiss on improper service grounds within 60 days after serving answer

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. within 60 days of serving his answer, he cannot challenge the court’s determination to grant that part of plaintiff’s cross motion seeking an extension of time for service of the summons and complaint pursuant to CPLR 306-b (citation omitted). In any event, upon consideration of the relevant factors, including the expiration of the statute of limitations, the meritorious nature of plaintiff’s cause of action against defendant, and defendant’s failure to show any prejudice, we conclude that the court did not abuse its discretion in granting that part of plaintiff’s cross motion (citations omitted).”).

Matter of Figueroa v. New York State Div. of Human Rights & Buffalo City School Dist., 142 A.D.3d 1316, 38 N.Y.S.3d 857 (4th Dep’t 2016) (“At the outset, we conclude that the District waived its contention that the petitions should be dismissed for lack of jurisdiction based upon the alleged failure of petitioners to serve the District in accordance with CPLR 311 (a) (7). Those objections to service were raised in the District’s answers, and the District failed to move to dismiss the petitions on that ground within 60 days after serving its answers (citations omitted). We also reject the District’s contention that the proceedings were not timely commenced, inasmuch as the limitations period commenced on the date of service of the Division’s order and the record does not establish the date of such service (citation omitted).”).

CPLR 3211(e) / 3018 - Can amend to add statute of limitations defense

Woloszuk v. Logan-Young, 2018 NY Slip Op 04176 (4th Dep’t 2018) (“With respect to appeal No. 1, we reject defendants' contention that Supreme Court abused its discretion in denying their motion seeking leave to amend their answers to add the statute of limitations as an affirmative defense. It is well settled that, ‘[i]n the absence of prejudice or surprise, leave to amend a pleading should be freely granted’ (citations omitted). Here, plaintiff established in opposition to the motion that he would be prejudiced by the late amendment of the answer (citations omitted).”).

CPLR 3211(e) -Waiver of personal jurisdiction defense

U.S. Bank N.A. v. Pepe, 161 A.D.3d 811 (2d Dep’t 2018) (“The filing of a notice of appearance in an action by a party’s counsel serves as a waiver of any objection to personal jurisdiction in the absence of either the service of an answer which raises a jurisdictional objection, or a motion to dismiss pursuant to CPLR 3211(a)(8) for lack of personal jurisdiction (citations omitted). Here, the defendant’s counsel filed a notice of appearance dated September 4, 2012. The record does not show that the defendant asserted lack of personal jurisdiction in a responsive pleading. Moreover, the defendant did not move to dismiss the complaint for lack of personal jurisdiction until almost three years after appearing in the action, after the judgment of foreclosure and sale had been issued. Under those circumstances, the defendant waived any claim that the court lacked personal jurisdiction over him in this action (citation omitted).”).

CPLR 3211(e) - Waiver of res judicata and arbitration defenses

Country-Wide Ins. Co. v Gotham Med., P.C., 154 A.D.3d 608, 63 N.Y.S.3d 349 (1st Dep’t 2017) (“Defendant waived the defenses of res judicata and award and arbitration (citations omitted). While the arbitral awards in its favor were not issued until after it had filed its answer in this action,

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. there is no indication on the record before us that defendant ever moved to amend its answer to assert either of those defenses.”).

CPLR 3212 - Summary judgment motion

CPLR 3212

David L. Ferstendig, Court of Appeals Splits on Whether Defendant Carried Burden on Summary Judgment Motion, 673 N.Y.S.L.D. 1, 2 (2016).

In Pullman v. Silverman, 2016 N.Y. Slip Op. 07107 (November 1, 2016), the issue was whether the medical expert affidavit submitted in support of defendant’s summary judgment motion adequately addressed plaintiff’s claims of liability. In this medical malpractice action, plaintiff alleged that he developed a cardiac arrhythmia, which progressed into an AV heart block, because of the defendant’s negligent administration of Lipitor and the combination of Lipitor and Azithromycin.

The defendant moved for summary judgment on the issue of causation only. The motion papers included a medical expert affidavit which characterized the plaintiff’s malpractice allegations as focusing on “an alleged contraindicated prescription by Dr. Silverman to plaintiff of Lipitor separately and/or in conjunction with Azithromycin.” Id. at *1. The plaintiff argued in opposition that the defendant’s expert failed to “address the concurrent azithromycin prescription and did not cite to any medical research in support of his conclusions about the combined effect.” Id.

The trial court granted the defendant’s summary judgment motion and the Appellate Division affirmed. Both courts found that the defendant had carried his burden and that the plaintiff’s expert submissions on causation were inadequate and did not raise an issue of fact.

A majority of the Court of Appeals reversed. The Court found that the defendant did not initially carry his burden since the defendant’s expert’s affidavit

proffered only conclusory assertions unsupported by any medical research that defendant’s actions in prescribing both drugs concurrently did not proximately cause plaintiff’s AV heart block. These conclusory statements did not adequately address plaintiff’s allegations that the concurrent Lipitor and azithromycin prescriptions caused plaintiff’s injuries. By ignoring the possible effect of the azithromycin prescription, defendant’s expert failed to “tender[] sufficient evidence to demonstrate the absence of any material issues of fact” (citation omitted) as to proximate causation and, as a result, defendant was not entitled to summary judgment.

Id. at *2.

The dissent, however, looked at the same affidavit and found that it had adequately addressed all of the relevant issues -

The affidavit of defendant’s expert explains that no epidemiological studies even link Lipitor or other statins to plaintiff’s injury and that an isolated case report— which, as the expert noted, cannot demonstrate causation (citation omitted)— showing that Lipitor, in combination with drugs other than Azithromycin, caused a type of myopathy was not relevant because plaintiff’s medical records revealed that he did not have myopathy. The expert affidavit sufficiently demonstrated, for purposes of making a prima facie case, that plaintiff had no pertinent adverse reaction to Lipitor that could have been exacerbated by the prescription of Azithromycin, which was the basis of plaintiff’s claim that the combination of drugs injured him. Contrary to the majority’s conclusion, the expert was not required to further “address the effect of [A]zithromycin administration alone or in conjunction with Lipitor” (citation omitted), which is the converse of plaintiff’s claim, as opposed to his actual claim.

Id. at *5.

CPLR 3212

David L. Ferstendig, Court Holds Defendant Failed to Meet its Burden on Summary Judgment Motion on Proximate Cause Issue, 674 N.Y.S.L.D. 3 (2017).

In Hain v. Jamison, 2016 N.Y. Slip Op. 08583 (December 22, 2016), late one evening, the decedent, the plaintiff’s wife, was struck and killed by a vehicle driven by one of the Jamison defendants (the other was the owner of the vehicle), as she walked in the northbound lane of a rural road. She had exited her vehicle and entered the road to help a wandering calf that had escaped a nearby enclosure owned by the defendant Drumm Family Farm Inc. (“Farm”). The complaint alleged, among other things, that Farm was negligent in failing to properly maintain its fence and restrain the calf and keep it off of the roadway. Farm and the Jamison defendants answered and asserted cross claims for contribution and indemnification.

Farm moved for summary judgment, asserting that its alleged negligence was not a proximate cause of decedent’s death. Instead, the decedent’s intervening and unforeseeable act of leaving her vehicle and entering the road and the other defendant driver’s negligence were the proximate causes of the incident.

The trial court denied the motion, holding that it could not determine as a matter of law “that decedent’s conduct in exiting her vehicle was sufficiently extraordinary and unforeseeable to break the chain of causation.” Id. at *2. The Appellate Division reversed, however, with a majority of the court holding that Farm had established that its negligence was not a proximate cause of decedent’s death because “Farm’s negligence merely furnished the occasion for, but did not cause, decedent to enter the roadway, where she was struck.” Id.

The Court of Appeals reversed, noting that the proximate cause element is satisfied when it is established that defendant’s negligence is a substantial cause of the events resulting in the plaintiff’s injuries. Where there is an allegation of an intervening act, the question then becomes whether that “act is a normal or foreseeable consequence of the situation created by the defendant’s negligence.” Id. at *3. The Court acknowledged that the line between intervening acts severing the causation chain and those that do not is not precise, and that proximate cause is a fact-specific determination. Cases holding that intervening acts break the causation chain either involve a situation where the acts were unforeseeable, or where the defendant’s acts of negligence “had ceased, and merely fortuitously placed the plaintiff in a location or position in which a secondary and separate instance of negligence acted independently upon the plaintiff to produce harm.” Id. at *5.

Farm claimed that the decedent’s decision to leave the safety of her vehicle to retrieve the calf severed the causal link between its alleged negligence and decedent’s death. Rather, its negligence merely furnished the occasion for the decedent to be walking in the roadway. In opposition, it was argued that decedent’s action in exiting the vehicle was reasonably foreseeable. The Court of Appeals held that neither of the two circumstances discussed above applied here to break the causation chain. The Court concluded that

[t]he very same risk that rendered negligent the Farm’s alleged failure to restrain or retrieve its farm animal – namely, that the wandering calf would enter a roadway and cause a collision – was, in fact, the risk that came to fruition. That the Farm could not predict the exact manner in which the calf would cause injury to a motorist does not preclude liability because the general risk and character of injuries was foreseeable. Furthermore, although decedent had apparently stopped her vehicle without striking the calf, the animal was still loose in the roadway and, under the circumstances, the danger and risk of an accident had not yet passed. The Farm’s alleged negligence – i.e., its failure to securely restrain and/or retrieve its wandering calf – was not a completed occurrence that merely fortuitously placed decedent in a relatively safe position or location where an independent and unrelated act of negligence operated to bring about her death. Thus, we cannot say, as a matter of law, that the Farm’s negligence merely furnished the occasion for the collision or that the accident resulting in decedent’s death did not flow from the Farm’s negligent conduct in permitting its calf to stray (citations omitted).

Id. at *6.

The Court stated that the factfinder could find that the decedent’s action in leaving her vehicle and entering the road to remove the calf was a “normal or foreseeable consequence of the situation created by defendant’s negligence” -

[A] wandering farm animal may be large enough to obstruct a roadway and, regardless of size, may impede traffic to a significant degree. Such an animal may cause substantial harm if struck by a vehicle or when a driver acts to avoid impact.

In addition, a factfinder may determine that a person, under the particular circumstances of a case, may reasonably consider it safe to approach the wandering animal.

Id. at *7.

CPLR 3212 - Trial court properly denied motion for summary judgment as untimely

Chmielowiec v. Blackwood, 144 A.D.3d 425, 40 N.Y.S.3d 107 (1st Dep’t 2016) (“Appellants’ assertion that they were unaware that the case had been assigned to Justice Guzman’s part before they moved for summary judgment is unsupported by the record and therefore cannot be considered (citation omitted). The assertion is also belied by their notice of motion, which is in the record, and which identifies the IAS Part and judge to which the motion should be referred. Since appellants provided no explanation for filing their motion for summary judgment outside the time period set by the rules of the assigned IAS judge, the motion court did not improvidently exercise its discretion in denying the motion as untimely (citations omitted).”).

CPLR 3212 - Motion for summary judgment should have been denied as untimely

Cullity v. Posner, 143 A.D.3d 513, 38 N.Y.S.3d 796 (1st Dep’t 2016) (“The motion should have been denied as untimely. The motion court’s rules required dispositive motions to be filed within 60 days of the filing of a note of issue. Defendant filed the motion papers nine days after the time to do so had expired, rendering the motion untimely (citations omitted). Defendants’ failure to address the missed filing deadline or offer, let alone show, good cause for the delay in filing, is fatal to their motion (citation omitted).”).

CPLR 3212 - Trial court should have denied summary judgment motion on timeliness grounds

Nationstar Mtge., LLC v. Weisblum, 143 A.D.3d 866, 39 N.Y.S.3d 491 (2d Dep’t 2016) (“Here, the plaintiff’s motion was made 128 days after filing of the note of issue, or 8 days after the 120- day deadline imposed by the Supreme Court in a notice to resume prosecution dated December 17, 2013. The plaintiff failed to demonstrate, in its moving papers, good cause for not filing the motion in a timely manner, as directed by the court citation omitted). The court improvidently exercised its discretion in considering that branch of the plaintiff’s motion which was for summary judgment on the complaint and in considering the good cause arguments raised for the first time in the plaintiff’s reply papers (citations omitted). Accordingly, the Supreme Court should have denied that branch of the plaintiff’s motion which was for summary judgment on the complaint.”).

CPLR 3212(a) - Counsel’s excuse that attorney handling the matter had been on trial for two weeks does not constitute good cause for late summary judgment motion

Kenny v. Turner Constr. Co., 155 A.D.3d 479, 65 N.Y.S.3d 17 (1st Dep’t 2017) (“The court providently exercised its discretion in denying as untimely Corporate Source’s motion for summary judgment dismissing the complaint as against it (citation omitted). Counsel’s excuse that

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the attorney handling the matter had been on trial for two weeks does not constitute good cause, i.e., ‘a satisfactory explanation for the untimeliness’ (citation omitted). Nor does the fact that the case is complicated and voluminous constitute good cause. We note that 14 other parties to the case made timely motions.”).

CPLR 3212(a) - Prior court orders and stipulations between the parties show that the parties, with the court's consent, charted a procedural course that deviated from the path established by the CPLR and allowed for defendants' filing of this round of summary judgment motions more than 120 days after the filing of the note of issue (citation omitted). Reeps v. BMW of N. Am., LLC, 160 A.D.3d 603, 72 N.Y.S.3d 451 (1st Dep’t 2018).

CPLR 3212 - Admissibility of unsigned deposition transcripts

CPLR 3212 - Plaintiffs established prima facie entitlement to judgment as a matter of law

Estate of Hansraj v. Sukhu, 145 A.D.3d 755, 43 N.Y.S.3d 127 (2d Dep’t 2016) (“Here, the plaintiffs established their prima facie entitlement to judgment as a matter of law by submitting, among other things, the five promissory notes, which each contained an unequivocal and unconditional obligation to pay, and proof of the defendants’ failure to make payments on the notes in accordance with their terms (citations omitted). In opposition, the defendants failed to raise a triable issue of fact. Their conclusory and unsubstantiated assertions that the decedent, Augustus Hansraj, and the defendant Ragobar D. Sukhu had entered into a joint venture to invest in real estate were insufficient to defeat the plaintiffs’ entitlement to summary judgment (citations omitted).”).

CPLR 3212 - Inadmissible documents alone cannot be sole basis of opposition

Erkan v. McDonald’s Corp., 146 A.D.3d 466, 468, 44 N.Y.S.3d 429, 431 (1st Dep’t 2017) (“Records without proper certification may be considered in opposition to a motion for summary judgment, but only when they are not the sole basis for the court’s determination (citations omitted). Here, the unverified documents and unsworn statement are the only evidence to challenge details of plaintiff’s version of the accident and therefore should not be considered. ‘The mere hope that evidence sufficient to defeat a motion for summary judgment may be uncovered during the discovery process is insufficient to deny such a motion’ (citation omitted).”).

CPLR 3212(a) - “Where, as here, a defendant has served a notice of appearance, but has not served ‘a responsive pleading,’ in this case, an answer (see CPLR 3011), issue has not been joined, and the plaintiff is barred from seeking summary judgment”

Jbbny, LLC v. Begum, 156 A.D.3d 769, 67 N.Y.S.3d 284 (2d Dep’t 2017) (“Contrary to the plaintiff’s contention, the Supreme Court properly denied those branches of its motion which were for summary judgment on the complaint and for an order of reference. ‘A motion for summary judgment may not be made before issue is joined (citation omitted and the requirement is strictly adhered to’ (citations omitted). Where, as here, a defendant has served a notice of appearance, but has not served ‘a responsive pleading,’ in this case, an answer (citation omitted), issue has not been joined, and the plaintiff is barred from seeking summary judgment (citations omitted). Accordingly, the court was powerless to grant summary judgment (citation omitted).”).

CPLR 3212(b) - Failure to attach petition is forgiven

Matter of Bordell, 2018 NY Slip Op 04404 (3d Dep’t 2018) (“For the first time on appeal, Basic contends that petitioner's motion was procedurally defective because it did not include a copy of the petition (citation omitted). Even had this contention been preserved for our review (citations omitted), we would find that the omission was not fatal given that the petition was submitted in connection with the earlier summary judgment motion and was before Surrogate's Court (citations omitted). Moreover, inasmuch as we may take judicial notice of the record in the prior appeal, which includes the petition (citations omitted), the record before us is ‘sufficiently complete to address the merits’ (citations omitted).”).

CPLR 3212(b) - Court cannot search record and award relief based on claim or defense not related to subject of motion

Board of Mgrs. of W. Amherst Off. Park Condominium v. RMFSG, LLC, 153 A.D.3d 1611, 61 N.Y.S.3d 401 (4th Dep’t 2017) (“[A]part from the affirmative defense of payment, which is discussed above, we do not address plaintiff’s contentions with respect to the affirmative defenses raised in the answers. In its motions for summary judgment, plaintiff did not expressly challenge those affirmative defenses and, in opposition to the motions, defendant did not rely upon them. We may not search the record and award relief based upon a claim or defense that is not related to the subject of the motion (citations omitted).”).

CPLR 3212(b) - Searching the record and granting summary judgment

City of New York v. Wausau Underwriters Ins. Co., 145 A.D.3d 614, 45 N.Y.S.3d 3 (1st Dep’t 2016) (“With respect to the fifth action, upon searching the record (CPLR 3212[b]), we grant summary judgment and declare that Wausau has no duty to defend the City or reimburse its defense costs in that underlying action.”).

CPLR 3212(b)

David L. Ferstendig, New York Court of Appeals Cannot Search Record, 684 N.Y.S.L.D. 3 (2017).

In Princes Point LLC v Muss Dev. L.L.C., 2017 NY Slip Op 07298 (October 19, 2017), the plaintiff requested a “reverse” summary judgment, or more accurately, that the Court of Appeals “search the record” and grant it summary judgment. CPLR 3212(b) provides that “[i]f it shall appear that any party other than the moving party is entitled to a summary judgment, the court may grant such judgment without the necessity of a cross-motion (emphasis added).” However, as the Court here noted, although the trial court and Appellate Division can search the record and grant summary judgment to a nonmoving party under CPLR 3212(b), the Court of Appeals cannot. See Merritt Hill Vineyards, Inc. v. Windy Heights Vineyard, Inc., 61 N.Y.2d 106, 110-11 (1984). Nevertheless, movants need to be aware of this “danger” at the trial court and Appellate Division level. Thus, when speaking with a client about the benefits, costs and risks of moving for summary judgment, it may be necessary to advise that the “worst case scenario” may not be just the denial of the motion, even where the opposing party has not made its own motion (or appealed).

CPLR 3212(b) / 3101(d)(1)(i) - Failure to provide timely expert witness disclosure under CPLR 3101(d)(1)(i) does not preclude consideration of expert afidavits on subsequent summary judgment motion- AS PER 2015 AMENDMENT

Moreland v. Huck, 156 A.D.3d 1396, 65 N.Y.S.3d 861 (4th Dep’t 2017) (“We affirm the order for reasons stated in the decision at Supreme Court. We write only to address plaintiff’s contention that the court should have granted her cross motion to strike the affidavits of the three subject witnesses because defendants failed to provide timely expert witness disclosure for those witnesses pursuant to CPLR 3101 (d) (1) (i). We reject that contention. Even assuming, arguendo, that each of the three witnesses provided expert testimony in his affidavit, we note that CPLR 3212 (b) provides in relevant part that, “[w]here an expert affidavit is submitted in support of, or opposition to, a motion for summary judgment, the court shall not decline to consider the affidavit because an expert exchange pursuant to [CPLR 3101 (d) (1) (i)] was not furnished prior to the submission of the affidavit.”).

CPLR 3212(f) - the Supreme Court properly denied, as premature, summary judgment motiot, with leave to renew upon the completion of discovery.

Salameh v. Yarkovski, 156 A.D.3d 659, 64 N.Y.S.3d 569 (2d Dep’t 2017) (“Here, the defendant Cab East, LLC (hereinafter Cab), moved for summary judgment dismissing the complaint insofar as asserted against it less than two months after the plaintiffs commenced this action, prior to the exchange of any discovery. Furthermore, in this action to recover damages for personal injuries arising from a motor vehicle accident, the submissions in opposition to Cab’s motion sufficiently established that facts may exist that would demonstrate that Cab owned one of the vehicles involved in the accident. Thus, an opportunity should be provided for the parties to conduct discovery which may result in disclosure of relevant information. Accordingly, the Supreme Court properly denied, as premature, Cab’s motion for summary judgment dismissing the complaint insofar as asserted against it, with leave to renew upon the completion of discovery (citations omitted).”).

CPLR 3212(f) - Motion was premature; made before anyone had been deposed

Brielmeier v. Leal, 145 A.D.3d 753, 43 N.Y.S.3d 134 (2d Dep’t 2016) (“‘CPLR 3212 (f) permits a court to deny a motion for summary judgment where it appears that the facts essential to oppose the motion exist but cannot then be stated’ (citations omitted). ‘This is especially so where the opposing party has not had a reasonable opportunity for disclosure prior to the making of the motion’ (citations omitted). Here, Publishers moved for summary judgment prematurely, shortly after the plaintiffs commenced their action against it and before anyone had been deposed. The plaintiffs demonstrated that discovery, including the depositions of Leal and someone from Publishers who had dealings with Leal, may result in disclosure of evidence relevant to the issue of whether Leal, the defendant driver, was Publishers’s employee or an independent contractor (citations omitted).”).

CPLR 3212(f) - Facts unavailable to opposing party – mere hope or speculation is not enough

HSBC Bank USA, N.A. v. Armijos, 151 A.D.3d 943, 57 N.Y.S.3d 205 (2d Dep’t 2017) (“In opposition, the appellant failed to raise a triable issue of fact. ‘[A] grant of summary judgment is not premature merely because discovery has not been completed’ (citations omitted). Here, the appellant failed to establish what additional information he hoped to glean from the entire mortgage file in its original form that could not be gleaned from the original note and mortgage and the portions of the mortgage file that the plaintiff had provided (citations omitted). ‘The mere hope or speculation that evidence sufficient to defeat a motion for summary judgment may be uncovered during the discovery process is insufficient to deny the motion’ (citations omitted). Moreover, the appellant’s bald assertion of forgery in his affidavit in opposition, in the absence of factual assertions to support such a claim, was inadequate to raise a triable issue of fact (citations omitted).”).

CPLR 3213 - Summary judgment in lieu of complaint

CPLR 3213 - Unequivocal and unconditional obligation to pay

CPLR 3213 - Unopposed motion for summary judgment in lieu of complaint- plaintiff still bore the burden of establishing that the defendants were properly served with the summons and motion, but not to furnish proof of the Florida court’s personal jurisdiction over them

TCA Global Credit Master Fund, L.P. v. Puresafe Water Sys., Inc., 151 A.D.3d 1098, 58 N.Y.S.3d 444 (2d Dep’t 2017) (“The plaintiff commenced this action by motion for summary judgment in lieu of complaint pursuant to CPLR 3213 to enforce a default judgment of the Circuit Court of the 17th Judicial Circuit in and for Broward County, Florida (hereinafter the Florida court). Service of process on the defendants was made by delivery to the Secretary of State pursuant to Business Corporation Law § 306(b). The defendants failed to appear or oppose the motion. However, in the order appealed from, the Supreme Court determined that the plaintiff failed to demonstrate that the Florida court had personal jurisdiction over the defendants, and expressed concern over the effectiveness of the service of process in that action and in this action. The court denied the plaintiff’s motion without prejudice to renewal upon proper proof of the Florida court’s personal jurisdiction over the defendants in the Florida action and proof of service of the order appealed from upon each defendant by any method available pursuant to CPLR § 311, except by delivery to the Secretary of State… Here, there was no jurisdictional challenge by the defendants. Accordingly, although the Supreme Court properly denied the plaintiff’s motion without prejudice to renewal upon proper proof, it erred in requiring the plaintiff to furnish proof of the Florida court’s personal jurisdiction over them. Instead, the Supreme Court should have required only proof of additional service in compliance with CPLR 3215(g)(4) (citations omitted). As the proponent of an unopposed motion for summary judgment in lieu of complaint, the plaintiff still bore the burden of establishing, inter alia, that the defendants were properly served with the summons and motion (citations omitted).”).

CPLR 3213 - Documents did not contain unconditional promise to pay sum certain

Oak Rock Fin., LLC v. Rodriguez, 148 A.D.3d 1036, 50 N.Y.S.3d 108 (2d Dep’t 2017) (“Although an unconditional guarantee may qualify as an instrument for the payment of money only (citations omitted), here, neither the guaranty nor the underlying agreement relied upon by the plaintiff in support of its motion contains an unconditional promise to pay a sum certain, signed by the maker and due on demand or at a definite future time (citation omitted). Since proof outside of the guaranty and underlying agreement is required to establish the amount of Platinum’s obligation to the plaintiff pursuant to the agreement, the plaintiff’s motion for summary judgment in lieu of complaint should have been denied, with the motion and answering papers deemed to be the complaint and answer, respectively (citations omitted).”).

CPLR 3213 - Motion denied because reference to extrinsic evidence was required

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. considering the parties’ complex arrangements, agreements and circumstances, and the inability to determine by simple reference to the guaranties whether defendants remained liable by their terms to pay a sum certain, plaintiff’s motion must be denied.”).

CPLR 3213 - Proof outside of the agreements requires denial of motion

CPLR 3213 - Extent of reference to extrinsic evidence exceeds permissible limited reference to outside sources allowable under CPLR 3213.

PDL Biopharma, Inc. v. Wohlstadter, 147 A.D.3d 494, 47 N.Y.S.3d 25 (1st Dep’t 2017) (“It is true that generally, an unconditional guaranty qualifies as an instrument amenable to CPLR 3213 treatment (citation omitted). However, here, it is unclear whether that is the case. For one thing, the documents guarantee not only ‘payment’ but also ‘performance’ of the borrower’s ‘obligations.’ …This extent of reference to extrinsic evidence exceeds any permissible limited reference to outside sources allowable under CPLR 3213. Given the foregoing necessity of considering the parties’ complex arrangements, agreements and circumstances, and the inability to determine by simple reference to the guaranties whether defendants remained liable by their terms to pay a sum certain, plaintiff’s motion must be denied.”).

CPLR 3213 - Used to enforce a default judgment

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. to renewal upon proper proof, it erred in requiring the plaintiff to furnish proof of the Florida court’s personal jurisdiction over them. Instead, the Supreme Court should have required only proof of additional service in compliance with CPLR 3215(g)(4) (citations omitted). As the proponent of an unopposed motion for summary judgment in lieu of complaint, the plaintiff still bore the burden of establishing, inter alia, that the defendants were properly served with the summons and motion (citations omitted).”).

CPLR 3215 - Default judgment

CPLR 3215(c) - How to waive right to seek dismissal of action as abandoned

A defendant can waive its right to obtain a dismissal of an action as abandoned under CPLR 3215(c) by his or her conduct, such as “serving an answer or taking any other steps which may be viewed as a formal or informal appearance.” US Bank N.A. v. Gustavia Home, LLC, 156 A.D.3d 843, 67 N.Y.S.3d 242 (2d Dep’t 2017) (“Here, National City Bank, Gustavia’s predecessor in interest, waived its right to seek a dismissal pursuant to CPLR 3215(c) by serving a notice of appearance and waiver, which constituted a formal appearance in the action, and by its stipulation dated October 23, 2015 (citations omitted).”). See Bank of Am., N.A. v. Rice, 155 A.D.3d 593, 63 N.Y.S.3d 486 (2d Dep’t 2017) (“Here, the defendant Gustavia Home, LLC, waived its right to seek dismissal of the complaint insofar as asserted against it pursuant to CPLR 3215(c) by filing a notice of appearance (citations omitted). Accordingly, the Supreme Court properly denied that branch of its motion which was pursuant to CPLR 3215(c) to dismiss the complaint insofar as asserted against it as abandoned.”).

CPLR 3215(c) - Defendant’s belated service of answer after original motion, inter alia, pursuant to CPLR 3215(c) to dismiss the complaint as abandoned had been denied, did not constitute a waiver of his right to seek dismissal of the complaint pursuant to CPLR 3215(c)

Kim v. Wilson, 150 A.D.3d 1019, 55 N.Y.S.3d 334 (2d Dep’t 2017) (“Here, the plaintiff failed to offer a reasonable excuse as to why she did not seek leave to enter a default judgment. The death of the plaintiff’s former attorney and the automatic stay of the proceeding (citation omitted) did not constitute a reasonable excuse, as the plaintiff’s former attorney died in May 2015, almost 3½ years after the one-year statutory time period had expired (citations omitted). Contrary to the plaintiff’s contention, the defendant’s belated service of an answer after his original motion, inter alia, pursuant to CPLR 3215(c) to dismiss the complaint as abandoned had been denied, did not constitute a waiver of his right to seek dismissal of the complaint pursuant to CPLR 3215(c) (citations omitted). Accordingly, upon reargument and renewal, the Supreme Court should have granted that branch of the defendant’s motion which was pursuant to CPLR 3215(c) to dismiss the complaint as abandoned.”).

CPLR 3215(c) - Abandoned action- examples

Checksfield v. Berg, 148 A.D.3d 1376, 49 N.Y.S.3d 205 (3d Dep’t 2017) (“Assuming without deciding that plaintiff articulated a potentially meritorious claim against defendant, he did not

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. provide a reasonable excuse for his delay in pursuing it. Plaintiff stated his legally unsupported belief that the case was ‘on indefinite extension’ after the attorney who prepared the complaint withdrew from representation. Plaintiff then explained that, after defendant ‘wouldn’t talk’ to another attorney he consulted, he embarked upon ill-defined efforts to ‘check into [defendant’s] financials’ out of court. Even had these assertions been backed by any competent proof, however, they in no way justify over a decade of procedural inaction on plaintiff’s part (citations omitted). Thus, in the absence of a reasonable excuse for the delay, Supreme Court properly dismissed the action as abandoned citations omitted).”).

Wells Fargo Bank, N.A. v. Bonanno, 146 A.D.3d 844, 45 N.Y.S.3d 173 (2d Dep’t 2017) (“Here, although it is undisputed that the appellant defaulted in September 2011, the plaintiff did not initiate proceedings for the entry of a default judgment until March 2014. Thus, the plaintiff was required to establish ‘sufficient cause’ why the complaint should not be dismissed, which requires a showing that it had a reasonable excuse for the delay in taking proceedings for the entry of a default judgment, and that it has a potentially meritorious cause of action (citations omitted). Here, while the plaintiff and the appellant were engaged in mandatory foreclosure settlement conferences for a period of approximately three months in 2012, at the conclusion of the second settlement conference on May 9, 2012, the plaintiff was authorized to proceed with the prosecution of this action. However, the plaintiff took no steps to initiate proceedings for entry of a default judgment until nearly two years later, and it failed to demonstrate a reasonable excuse for this delay (citations omitted). Accordingly, the Supreme Court should have denied that branch of the plaintiff’s motion which was for an order of reference insofar as asserted against the appellant, and granted that branch of the appellant’s cross motion which was pursuant to CPLR 3215(c) to dismiss the complaint insofar as asserted against her as abandoned.”).

HSBC Bank USA, N.A. v. Grella, 145 A.D.3d 669, 44 N.Y.S.3d 56 (2d Dep’t 2016) (“‘The language of CPLR 3215(c) is not, in the first instance, discretionary, but mandatory, inasmuch as courts shall’ dismiss claims (CPLR 3215[c]) for which default judgments are not sought within the requisite one-year period, as those claims are then deemed abandoned’ (citations omitted). The failure to timely seek a default may be excused if ‘sufficient cause is shown why the complaint should not be dismissed’ (CPLR 3215[c]), which requires the plaintiff to proffer a reasonable excuse for the delay in timely moving for a default judgment and to demonstrate that the cause of action is potentially meritorious (citations omitted). Here, the defendant was personally served with process on May 19, 2011, and she defaulted by failing to serve an answer within 20 days (see CPLR 3012[a]). However, the plaintiff took no steps to initiate proceedings for the entry of a default judgment at any point before the defendant moved in May 2014 to dismiss the complaint insofar as asserted against her as abandoned. The fact that the case was in the mandatory settlement conference part (see 22 NYCRR 202.12-a[c][7]) from January 2012 until December 19, 2012, did not constitute a reasonable excuse for the plaintiff’s protracted delay, since the case was released from that part more than a year before the defendant’s May 2014 motion (citations omitted). Although the Supreme Court issued a stay of all proceedings in the action on April 15, 2014, that stay did not constitute a reasonable excuse because it was issued nearly two years after the defendant defaulted, and more than one year after mandatory settlement conferences had ended. The plaintiff’s vague and unsubstantiated assertions that it withheld prosecution until such time as it could assess whether the mortgaged premises had been damaged by Hurricane Sandy, and that

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. it spent a year reviewing and processing unspecified documentation, were also insufficient to establish a reasonable excuse for its failure to initiate proceedings for over three years after the defendant’s default. Since the plaintiff failed to meet its burden to show sufficient cause why the complaint should not be dismissed, the court should have granted the defendant’s motion to dismiss the complaint insofar as asserted against her (citations omitted).”).

CPLR 3215(c) - Plaintiff’s motion for reference evidenced intent to continue prosecution of action

US Bank N.A. v. Brown, 147 A.D.3d 428, 46 N.Y.S.3d 107 (1st Dep’t 2017) (“The court correctly found that plaintiff took ‘proceedings for the entry of judgment within one year after the defendant’s default’ (see CPLR 3215[c]). Plaintiff made its first application for an order of reference within the statutory time limitation. The fact that this application was denied because plaintiff attempted to withdraw it without prejudice is of no moment, since the statute merely requires that the party needs only to initiate proceedings, ‘and these proceedings manifest an intent not to abandon the case’ (citations omitted). Plaintiff clearly and unequivocally indicated that it intended to continue the prosecution of this case at the time it made its motion for a reference. Such a timely application ‘even if unsuccessful’ will not result in the dismissal of the complaint ‘as abandoned pursuant to CPLR 3215(c)’ (citations omitted).”) (citing Weinstein, Korn & Miller).

CPLR 3215(c) - Plaintiff initiated proceedings for entry of default judgement

Wells Fargo Bank, N.A. v. Daskal, 142 A.D.3d 1071, 37 N.Y.S.3d 353 (2d Dep’t 2016) (“Here, in July 2008, the plaintiff took the preliminary step toward obtaining a default judgment of foreclosure and sale by moving, inter alia, for an order of reference within two months after Daskal’s default in appearing or answering. Thus, the plaintiff initiated proceedings for entry of the default judgment of foreclosure and sale within one year of Daskal’s default (citations omitted) and demonstrated that it did not abandon the action (citations omitted).”) (citing Weinstein, Korn, and Miller).

CPLR 3215(c) - Sufficient excuse

HSBC Bank USA, N.A. v. Hasis, 154 A.D.3d 832, 62 N.Y.S.3d 467 (2d Dep’t 2017) (“However, ‘[f]ailure to take proceedings for entry of judgment may be excused . . . upon a showing of sufficient cause,’ which requires the plaintiff to ‘demonstrate that it had a reasonable excuse for the delay in taking proceedings for entry of a default judgment and that it has a potentially meritorious action’ (citations omitted). Under the circumstances present here, including the closure of the law firm that previously represented the plaintiff and a Chapter 7 bankruptcy filing by the defendant, we agree with the Supreme Court that the plaintiff showed a reasonable excuse for its delay in proceeding toward a default judgment (citations omitted).”).

CPLR 3215(c) - Failure to demonstrate a reasonable excuse for her delay in moving for a default judgment

Ibrahim v. Nablus Sweets Corp., 161 A.D.3d 961 (2d Dep’t 2018) (“The Supreme Court providently exercised its discretion in rejecting the plaintiff’s excuse of law office failure and properly, in effect, directed dismissal of the complaint insofar as asserted against the defendants as abandoned pursuant to CPLR 3215(c). The plaintiff’s excuse of law office failure did not rise to the level of a reasonable excuse, as it was vague, conclusory, and unsubstantiated (citations omitted). The excuse was contained in a brief paragraph in the supporting affirmation of an associate who stated, in sum and substance, that the attorney who commenced the action left the employ of the law firm of record, and the plaintiff’s file was only discovered in May 2016 when the firm was relocating its offices. There was no affirmation from a principal of the law firm and no indication in the associate’s affirmation that he had any personal knowledge of the purported law office failure or that he was even employed by the firm at the time it allegedly occurred. The one-year period to move for the entry of a default judgment lapsed in August 2015, and there is no indication that the attorney had left prior thereto. Since the plaintiff failed to demonstrate a reasonable excuse for her delay in moving for a default judgment, the Supreme Court providently exercised its discretion in denying that branch of the plaintiff’s motion which was pursuant to CPLR 2004 for an extension of time to move for a default judgment (citation omitted).”).

CPLR 3215(c) - Plaintiff’s ex parte motion for an order of reference, the preliminary step toward obtaining a default judgment of foreclosure and sale was initiated, and therefore, the action was not abandoned

Bank of N.Y. Mellon v. Shterenberg, 153 A.D.3d 1310, 61 N.Y.S.3d 304 (2d Dep’t 2017) (“In July 2008, the plaintiff commenced this mortgage foreclosure action and, by order dated November 26, 2010, the Supreme Court granted the plaintiff’s ex parte motion for an order of reference. By order dated October 8, 2013, following further proceedings, the court, sua sponte, directed dismissal of the complaint as abandoned pursuant to CPLR 3215(c). In March 2015, the plaintiff moved to vacate the order dated October 8, 2013, and to restore the action to the trial calendar, arguing, inter alia, that the issuance of new mortgage review requirements by the Office of Court Administration had caused extensive and unforeseen delays in the foreclosure proceedings. The Supreme Court denied the motion. We reverse. The Supreme Court erred in, sua sponte, directing dismissal of the complaint pursuant to CPLR 3215(c). ‘A court’s power to dismiss a complaint, sua sponte, is to be used sparingly and only when extraordinary circumstances exist to warrant dismissal’ (citations omitted). There were no extraordinary circumstances warranting dismissal of the complaint (citation omitted). In November 2010, when the Supreme Court granted the plaintiff’s ex parte motion for an order of reference (see RPAPL 1321[1]), the preliminary step toward obtaining a default judgment of foreclosure and sale was initiated, and therefore, the action was not abandoned (citation omitted).”).

CPLR 3215(f) - Failure to comply does not render judgment a nullity

NYCTL 1998-2 Trust v. Ocean Gate Estate Homeowners Assn., Inc., 143 A.D.3d 683, 38 N.Y.S.3d 599 (2d Dep’t 2016) (“Contrary to the defendant’s contention, the plaintiff’s alleged failure to

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. comply with CPLR 3215(f) does not render the judgment a nullity (citations omitted). Moreover, the plaintiff was not required to serve an additional copy of the summons and complaint pursuant to CPLR 3215(g)(4) before obtaining a default judgment against the defendant, since this is an action affecting title to real property (citation omitted).”).

CPLR 3215(g)(1) - Conflict in Appellate Division Departments as to whether the failure to provide the requisite five-day notice to a defendant who has appeared in the action is a jurisdictional defect

There is a dispute among the Appellate Division Departments as to whether the failure to provide the requisite five-day notice to a defendant who has appeared in the action is a jurisdictional defect depriving the defendant of a substantial right and the court of the authority to hear the motion. The First Department has held that the failure to give the notice required a new inquest. See Walker v. Foreman, 104 A.D.3d 460, 963 N.Y.S.2d 625 (1st Dep’t 2013). The Second Department recently held that the failure to give notice “is a jurisdictional defect that deprives the court of the authority to entertain a motion for leave to enter a default judgment.” Paulus v. Christopher Vacirca, Inc., 128 A.D.3d 116, 6 N.Y.S.3d 572 (2d Dep’t 2015). The Third Department found that the failure to provide notice standing alone did not warrant vacatur of the default judgment. See Fleet Fin. v. Nielsen, 234 A.D.2d 728, 650 N.Y.S.2d 904 (3d Dep’t 1996). The Fourth Department, while being a bit inconsistent in its holdings, has recently settled in on finding the failure to be a jurisdictional defect meriting vacatur of the default judgment. See Curto v. Diehl, 87 A.D.3d 1374, 929 N.Y.S.2d 901 (4th Dep’t 2011). See also Weinstein, Korn & Miller, New York Civil Practice: CPLR P 3215.37.

Citimortgage, Inc. v. Reese, 2018 NY Slip Op 04527 (2d Dep’t 2018) (“The defendant was entitled to notice of the plaintiff's motions for an order of reference and for a judgment of foreclosure and sale pursuant to CPLR 3215(g)(1), which provides, in relevant part, that such notice to a defendant who has not appeared is required ‘if more than one year has elapsed since the default.’ Here, the defendant defaulted in November 2009, and the plaintiff moved for an order of reference in March 2013, more than three years later. Contrary to the plaintiff's contention, the issue of its failure to comply with CPLR 3215(g)(1) may be raised for the first time on appeal (citations omitted). The failure to give a party proper notice of a motion deprives the court of jurisdiction to entertain the motion and renders the resulting order void (citations omitted). Accordingly, since the Supreme Court lacked jurisdiction to entertain the plaintiff's motions, it should have granted those branches of the defendant's motion which were to vacate the order of reference and the judgment of foreclosure and sale (citation omitted).”).

CPLR 3215(g)(3)- Additional notice requirement under CPLR 3215(g)(3)

Bank of Am., N.A. v. Diaz, 160 A.D.3d 457, 75 N.Y.S.3d 147 (1st Dep’t 2018) (“Because the RPAPL provisions cited by both plaintiff and defendant were enacted after CPLR 3215(g)(3), the clearest indicator of whether a non-owner-occupied home is a ‘residential mortgage’ for the purpose of the additional notice requirement is the statute itself. CPLR 3215(g)(3) provides that when a default judgment ‘based upon nonappearance is sought against a natural person in an action based upon nonpayment of a contractual obligation,’ that person is entitled to additional notice of

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the action, which is provided by mailing the summons to his or her place of residence. The provision was enacted out of concern for ‘unsophisticated homeowners’ who ‘do not receive sufficient notice that they are about to lose their homes through foreclosure’ (citation omitted). As defendant does not reside at the mortgaged property, this foreclosure proceeding does not place his home at risk. Accordingly, we find that plaintiff was not required to serve a 3215(g)(3) notice on defendant. Given the factual issues as to the validity of service of the summons and complaint, the threshold issue of personal service should have been resolved with a traverse hearing (citations omitted). We reverse and remand for such a hearing.”).

CPLR 3216 - Want of prosecution- neglect to proceed

CPLR 3216 - Dismissal order did not meet statutory preconditions

US Bank, N.A. v. Mizrahi, 156 A.D.3d 661, 64 N.Y.S.3d 565 (2d Dep’t 2017) (“‘A court may not dismiss an action based on neglect to prosecute unless the statutory preconditions to dismissal, as articulated in CPLR 3216, are met’ (citation omitted). The September order could not be deemed a 90-day demand pursuant to CPLR 3216 because it gave US Bank only 60 days within which to file a motion for summary judgment (citation omitted). Since the dismissal order dated November 29, 2012, merely effectuated the September order, which did not meet the statutory preconditions set forth in CPLR 3216, there was a failure of a condition precedent, and the Supreme Court was not authorized to dismiss the action on its own motion (citation omitted). In any event, there was no evidence that the plaintiff intended to abandon the action, that the default was willful, or that the defendants were prejudiced (citations omitted).”).

CPLR 3216 - Compliance conference order fails to set forth any specific conduct constituting neglect by the plaintiff; thus, court could not dismiss

Goetz v. Public Serv. Truck Renting, Inc., 2018 NY Slip Op 04534 (2d Dep’t 2018) (“‘A court may not dismiss an action based on neglect to prosecute unless the statutory preconditions to dismissal, as articulated in CPLR 3216, are met’ (citation omitted). ‘Effective January 1, 2015, the Legislature amended, in several significant respects, the statutory preconditions to dismissal under CPLR 3216’ (citation omitted). One such precondition is that where a written demand to resume prosecution of the action is made by the court, as here, ‘the demand shall set forth the specific conduct constituting the neglect, which conduct shall demonstrate a general pattern of delay in proceeding with the litigation’ (citation omitted). Here, the compliance conference order did not set forth any specific conduct constituting neglect by the plaintiff. Accordingly, since one of the statutory preconditions to dismissal was not met, the court should not have directed dismissal of the complaint pursuant to CPLR 3216 (citation omitted).”).

CPLR 3216 - Not proper 90-day demand

Atmara, Inc. v. Panoramic Ace Props., Inc., 151 A.D.3d 922, 58 N.Y.S.3d 414 (2d Dep’t 2017) (“Contrary to the defendants’ contentions, the so-ordered stipulation dated November 3, 2014, which extended the plaintiffs’ time to file the note of issue until January 8, 2015, superseded the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. compliance conference order dated July 11, 2012. As the so-ordered stipulation dated November 3, 2014, did not advise the plaintiffs that the failure to comply with that deadline would serve as a basis for a motion to dismiss the action, it cannot be deemed a 90-day demand (citations omitted). Furthermore, the complaint could not have properly been dismissed pursuant to CPLR 3126 based upon the plaintiffs’ failure to comply with court-ordered discovery since there was no motion requesting that relief (citations omitted). Accordingly, the plaintiffs’ motion to vacate the dismissal of the complaint and restore the action to the court’s calendar should have been granted. Moreover, the Supreme Court erred in, sua sponte, directing the dismissal of the defendants’ counterclaims (citations omitted).”).

CPLR 3216 - Court’s so-ordered demand has same effect as 90-day demand

Stroll v. Long Is. Jewish Med. Ctr., 151 A.D.3d 789, 56 N.Y.S.3d 349 (2d Dep’t 2017) (“It is undisputed that the plaintiff subsequently failed to comply with the terms of the demand and, as a result, the action was administratively dismissed. The plaintiff then moved, inter alia, in effect, to vacate the dismissal of the action pursuant to CPLR 3216 and to restore the action to the active calendar, on the ground that the administrative dismissal was a legal nullity. The Supreme Court denied the motion, and the plaintiff appeals. Initially, we note that although CPLR 3216 was amended, effective January 1, 2015, to require that a 90-day demand served by the court set forth the specific conduct constituting the neglect and that notice be given to the parties prior to dismissal of the action for unreasonable neglect to proceed (citation omitted), the Supreme Court’s so- ordered demand pursuant to CPLR 3216 and the administrative dismissal of the action predated the amendments. Thus, we do not consider the amendments on this appeal. Contrary to the plaintiff’s contention, the Supreme Court’s so-ordered demand pursuant to CPLR 3216 had the same effect as a 90-day notice pursuant to CPLR 3216 (citations omitted). Nor can there be any doubt that the plaintiff’s counsel, who signed the demand, actually received a copy of it (citations omitted). Therefore, the plaintiff was required either to timely file a note of issue or move, before the default date, for an extension of time pursuant to CPLR 2004. Since the plaintiff did neither, the action was properly dismissed pursuant to CPLR 3216 on the Supreme Court’s own initiative (citations omitted).”).

CPLR 3216 - Court failed to give notice to parties

Rhodehouse v. CVS Pharmacy, Inc., 151 A.D.3d 771, 56 N.Y.S.3d 228 (2d Dep’t 2017) (“Here, the certification order did not set forth any specific conduct constituting neglect by the plaintiff. Another precondition to dismissal is that where the court, on its own initiative, seeks to dismiss an action pursuant to CPLR 3216, it must first give the parties notice of its intention to do so (citation omitted). Such notice is meant to provide the parties with an opportunity to be heard prior to the issuance of an order dismissing the action (citation omitted). Here, the Supreme Court failed to give the parties notice and an opportunity to be heard prior to considering whether to dismiss the action pursuant to CPLR 3216. Since the statutory preconditions to dismissal were not met, the court erred in directing the dismissal of the action pursuant to CPLR 3216.”).

CPLR 3216 - Court erred in administratively dismissing action without further notice

Deutsche Bank Natl. Trust Co. v. Cotton, 147 A.D.3d 1020, 46 N.Y.S.3d 913 (2d Dep’t 2017) (“On February 11, 2014, the Supreme Court, sua sponte, entered an order pursuant to CPLR 3216 dismissing the instant action and directing the County Clerk to vacate the notice of pendency ‘unless plaintiff files a note of issue or otherwise proceeds by motion for entry of judgment within 90 days from the date hereof.’ It appears that the action was thereafter administratively dismissed on June 5, 2014, without further notice to the parties. On December 11, 2014, the plaintiff moved to vacate the dismissal and to restore this action to the active calendar. The Supreme Court denied the motion, which was unopposed. An action cannot be dismissed pursuant to CPLR 3216(a) ‘unless a written demand is served upon the party against whom such relief is sought’ in accordance with the statutory requirement, along with a statement that the default by the party upon whom such notice is served in complying with such demand within said ninety day period will serve as a basis for a motion by the party serving said demand for dismissal as against him for unreasonably neglecting to proceed’ (citation omitted). Here, the order dated February 11, 2014, which purported to serve as a 90-day notice pursuant to CPLR 3216, was defective in that it failed to state that the plaintiff’s failure to comply with the notice ‘will serve as a basis for a motion’ by the court to dismiss the action for failure to prosecute (CPLR 3216[b][3]). The Supreme Court thereafter erred in administratively dismissing the action without further notice to the parties (citations omitted). Accordingly, the Supreme Court should have granted the plaintiff’s motion to vacate the order dated February 11, 2014, and to restore the action to the active calendar.”).

CPLR 3216 - Ministerial dismissal without notice was improper

US Bank N.A. v. Saraceno, 147 A.D.3d 1005, 48 N.Y.S.3d 163 (2d Dep’t 2017) (“As the plaintiff correctly observes, the ministerial dismissal of the action was improper. Although the Supreme Court appears to have relied upon CPLR 3216(b) as authority for its actions, the order dated March 28, 2013, failed to constitute a valid 90-day demand under that statute, since it did not recite that noncompliance with its terms ‘will serve as a basis for a motion . . . for dismissal . . . for unreasonably neglecting to proceed’ (citations omitted). Moreover, the court never directed the parties to show cause as to why the action should not be dismissed, and did not enter a formal order of dismissal on notice to the parties as required by CPLR 3216(a) (citations omitted). Accordingly, the ministerial dismissal, made without notice and without benefit of further judicial review, was erroneous (citation omitted).”).

CPLR 3216 - Relief not authorized where issue not joined

U.S. Bank N.A. v. Ricketts, 153 A.D.3d 1298, 61 N.Y.S.3d 571 (2d Dep’t 2017) (“CPLR 3216 authorizes the dismissal of a complaint for neglect to prosecute provided that certain statutory conditions precedent are met, such as issue having been joined in the action (citations omitted). Here, dismissal of the action pursuant to the March 2014 conditional order was improper, as issue was never joined inasmuch as none of the defendants served an answer to the complaint (citations omitted). Since at least one precondition set forth in CPLR 3216 was not met here, the Supreme Court was without power to dismiss the action pursuant to that statute (citations omitted).”).

Downey Sav. & Loan Assn., F.A. v. Aribisala, 147 A.D.3d 911, 47 N.Y.S.3d 413 (2d Dep’t 2017) (“CPLR 3216 permits dismissal of a party’s pleading where certain conditions precedent have been complied with. Here, however, where issue was not joined, at least one precondition set forth in CPLR 3216 was not met, and the court was therefore without power to dismiss the action pursuant to CPLR 3216 (citations omitted).”).

CPLR 3216 - Motion granted; plaintiff took no action…

Deutsche Bank Natl. Trust Co. v. Inga, 156 A.D.3d 760, 67 N.Y.S.3d 264 (2d Dep’t 2017) (“Under the circumstances of this case, the Supreme Court providently exercised its discretion in granting the defendant’s motion pursuant to CPLR 3216 to dismiss the action insofar as asserted against him. The plaintiff took no action whatsoever in the five years from the time the case was released from the foreclosure settlement part on October 15, 2009, until the defendant served his 90-day demand on October 10, 2014. Moreover, after failing to comply with the 90-day deadline, the plaintiff took no action for five months before belatedly filing a note of issue. The plaintiff failed to provide a justifiable excuse for its delay in filing a note of issue and failed to demonstrate a potentially meritorious cause of action. The plaintiff’s further contention that dismissal was too harsh a sanction, and that a lesser sanction was more appropriate under the circumstances, is unavailing, given the plaintiff’s ‘pattern[ ] of persistent neglect, a history of extensive delay, evidence of an intent to abandon prosecution and lack of any tenable excuse for such delay’ (citation omitted).”).

CPLR 3217- Voluntary discontinuance

CPLR 3217(a)(1) - Conflict as to whether a motion to dismiss is a responsive pleading within meaning of CPLR 3217(a)(1) (providing for service of notice of discontinuance)

There is a conflict in the Appellate Division as to whether a motion to dismiss is a “responsive pleading” within the meaning of CPLR 3217(a)(1). The First Department concludes that it is because otherwise, “a plaintiff would be able to freely discontinue its action without prejudice solely to avoid a potentially adverse decision on a pending dismissal motion.” See BDO USA, LLP v. Phoenix Four, Inc., 113 A.D.3d 507, 979 N.Y.S.2d 45 (1st Dep’t 2014) (“Thus, BDO’s notice was ineffective and a nullity, and the motion court should not have deemed defendants’ motions withdrawn (citations omitted). That BDO served its notice of discontinuance in an attempt to circumvent the Administrative Judge’s order denying its request to have its action assigned to the Commercial Division may be a valid basis for granting a discontinuance with prejudice (citations omitted). However, given the unusual procedural history that led to the commencement of this action, we decline to discontinue the action with prejudice. Specifically, this action arose from defendant SRC’s failure to properly notify this Court of the settlement the parties had reached in the contribution action before the mediator. Indeed, although the parties had reached a settlement, and the mediator specifically directed the parties to inform this Court of the settlement, SRC unilaterally took the position that the settlement was not effective and that the appeal should continue. As a result, this Court dismissed the contribution action before the parties finalized a written agreement, thus precluding BDO from enforcing the oral agreement (citations omitted).”). The Fourth Department has come to a contrary conclusion. See Harris v. Ward Greenberg Heller

& Reidy LLP, 151 A.D.3d 1808, 58 N.Y.S.3d 769 (4th Dep’t 2017) (“Based on the statute’s language and the legislative history, we conclude that a determination that a motion to dismiss is a responsive pleading is contrary to the statute. Moreover, if the Legislature intended for a motion to dismiss to defeat a plaintiff’s absolute right to serve a notice of discontinuance, it could easily have said so. Thus, in appeal No. 1, we conclude that plaintiff’s notices of discontinuance were timely, and we therefore reverse the order therein.”).

CPLR 3217(a)(1) - Right to discontinue by service of notice

A.K. v. T.K., 150 A.D.3d 1091, 56 N.Y.S.3d 168 (2d Dep’t 2017) (“Here, neither a complaint nor a responsive pleading was ever served in the third action, thereby preserving the absolute and unconditional right to discontinue by serving notice (citation omitted).”).

CPLR 3217(b) - No evidence that the defendant would be prejudiced by a discontinuance without prejudice

Kondaur Capital Corp. v. Reilly, 2018 NY Slip Op 04707 (2d Dep’t 2018) (“CPLR 3217(b) permits a voluntary discontinuance of a claim by court order ‘upon terms and conditions, as the court deems proper’ (citations omitted). In general, absent a showing of special circumstances, including prejudice to a substantial right of the defendant or other improper consequences, a motion for a voluntary discontinuance should be granted without prejudice (citations omitted). Here, there was no evidence that the defendant would be prejudiced by a discontinuance without prejudice (citation omitted). The defendant failed to establish as a matter of law that a second action would be time-barred and failed to show that he was prejudiced by the length of the litigation. Therefore, the Supreme Court should have granted that branch of the plaintiff's motion which was to discontinue the action without prejudice, and denied the defendant's cross motion to discontinue the action with prejudice. Moreover, under the circumstances of this case, there was no basis for the court, sua sponte, to direct a hearing on the amount of counsel fees to be awarded to the defendant.”).

CPLR 3217(c) - Effect of discontinuance

US Bank Natl. Assn. v. Cockfield, 143 A.D.3d 889, 40 N.Y.S.3d 145 (2d Dep’t 2016) (“Here, contrary to the Supreme Court’s determination and the defendant’s assertions, the plaintiff did not seek to discontinue this action by means of notice pursuant to CPLR 3217(c). To the contrary, the plaintiff moved for an order of discontinuance, pursuant to CPLR 3217(b). Thus, the court erroneously concluded that discontinuance of the third action ‘must be with prejudice’ under CPLR 3217(c) (citations omitted).”).

CPLR 3218 – Judgment by confession

CPLR 3218 - Motion to vacate confession of judgment on grounds that it was limited to use in foreclosure action denied

Scialo v. Sheridan Elec., Ltd., 153 A.D.3d 1294, 61 N.Y.S.3d 127 (2d Dep’t 2017) (“Contrary to the defendants’ contention, the language of the contract of sale, an escrow agreement, and the affidavits of confession of judgment did not condition the use of the affidavits only in the context of a foreclosure action. Furthermore, the defendants failed to submit clear, positive, and satisfactory evidence of any fraud, misconduct, or other circumstances that would require the confession of judgment in question to be set aside (citations omitted).”).

CPLR 3218 - Affidavit of confession of judgment – Defendants lack standing to challenge affidavit

Cash & Carry Filing Serv., LLC v. Perveez, 149 A.D.3d 578, 50 N.Y.S.3d 277 (1st Dep’t 2017) (“Defendants may challenge the judgment by confession only by trial in a plenary action, and not by motion (citation omitted). Moreover, defendants lack standing to challenge the affidavit of confession of judgment. An affidavit of confession of judgment pursuant to CPLR 3218 ‘is intended to protect creditors of a defendant,’ not the defendant itself (citations omitted). In any event, the affidavit in this case is sufficient (citation omitted). Defendants’ assertions of duress in executing the June 10, 2014 agreement leading to the judgment by confession are unavailing. In order to claim duress defendants had to show that plaintiff used a ‘wrongful threat’ to force defendants to enter into the agreement, and defendants failed to make that showing (citations omitted). ‘Financial pressures, even in the context of unequal bargaining power, do not constitute economic duress’ (citations omitted).”).

ARTICLE 34 - CALENDAR PRACTICE

CPLR 3402 - Note of issue

CPLR 3402 - Uniform Rules – Striking note of issue where discovery incomplete

Place v. Chaffee-Sardinia Volunteer Fire Co., 143 A.D.3d 1271, 39 N.Y.S.3d 568 (4th Dep’t 2016) (“In appeal No. 2, we agree with defendants that the court erred in holding in abeyance that part of their motion seeking to strike the note of issue and certificate of readiness and instead should have granted that part of their motion. It is well established that a note of issue should be vacated when it is based upon a certificate of readiness that contains an erroneous material fact (citation omitted) Here, defendants established that discovery was incomplete when the note of issue and certificate of readiness were filed, and they therefore established that ‘a material fact in the certificate of readiness [was] incorrect’ (citations omitted).”).

CPLR 3402 - Post note of issue discovery

Kanaly v. DeMartino, 2018 NY Slip Op 04060 (3d Dep’t 2018) (“To the extent that plaintiff argues that Supreme Court's order was improper because defendants did not establish their entitlement to post-note of issue discovery (citations omitted), the parties' disputes over the scope of the medical authorizations were ongoing and began long before the note of issue was filed; these were not new discovery requests. Moreover, plaintiff's expert disclosure was not filed until more than a year after the note of issue was filed, so any disagreement about the scope of that disclosure, or request for additional information about the experts, could not have been addressed pre-note of issue. In any event, Supreme Court had broad discretion to ‘permit post-note of issue discovery without vacating the note of issue,’ as no party was prejudiced (citations omitted).”)

CPLR 3404- Dismissal of abandoned case

Bradley v. Konakanchi, 156 A.D.3d 187, 191 (4th Dep’t 2017).

David L. Ferstendig, Further Appellate Division Conflicts, and One Resolved, 689 N.Y.S.L.D. 3- 4 (2018)

Applicability of CPLR 3404 to Actions Where the Note Issued Has Been Vacated

CPLR 3404 provides that a case "marked ‘off’ or struck from the calendar or unanswered on a clerk’s calendar call, and not restored within one year thereafter, shall be deemed abandoned and shall be dismissed without costs for neglect to prosecute."

The First, Second, and Fourth Departments hold that CPLR 3404 does not apply to a case where the note of issue has been vacated. See Turner v. City of New York, 147 A.D.3d 597, 597 (1st Dep’t 2017); Liew v. Jeffrey Samel & Partners, 149 A.D.3d 1059, 1061 (2d Dep’t 2017); Bradley v. Konokanchi, 156 A.D.3d 187, 190–91 (4th Dep’t 2014). The rationale behind the majority view is that vacating the note of issue "returns the case to pre-note of issue status. It does not constitute a marking ‘off’ or striking the case from the court’s calendar within the meaning of CPLR 3404." Montalvo v. Mumpus Restorations, Inc., 110 A.D.3d 1045, 1046 (2d Dep’t 2013). The Third Department, however, refuses to follow the majority. See Hebert v. Chaudrey, 119 A.D.3d 1170, 1171–72 (3d Dep’t 2014). See also Gray v. Jim Cuttita Agency Inc., 281 A.D.2d 785, 785–86 (3d Dep’t 2014) ("Where, as here, a case is actually placed on the trial calendar, subsequently stricken therefrom by an order of the court and then not restored within one year, it is deemed abandoned and dismissed pursuant to CPLR 3404.").

The most recent inductee to the majority position, the Fourth Department, recently explained its position and criticized the Third Department view:

To state the obvious, a note of issue does not survive its own vacatur, and it makes no sense to apply CPLR 3404 when the statute’s operative premise—i.e., the continuing vitality of the note of issue—no longer exists. The Third Department’s

contrary rule—like the textually-based arguments in defendant’s brief—fails to recognize the technical distinction between vacating a note of issue and marking off/striking a properly noted case from the calendar. Indeed, "it is precisely in such [latter] circumstances that CPLR 3404, by its express terms, applies." In other words, while it is of course true (as defendant insists) that a case is "place[d]" on the calendar by filing a note of issue, it does not follow—as the Third Department consistently holds—that a case is "marked off" or "struck" from the calendar within the meaning of CPLR 3404 whenever the note of issue is vacated pursuant to 22 NYCRR 202.21 (e) (citations omitted).

CPLR 3404 - Court improvidently exercised its discretion in, sua sponte, directing dismissal of the complaint pursuant to 22 NYCRR 202.27(b)

Yi Jing Tan v. Liang, 160 A.D.3d 786, 75 N.Y.S.3d 68 (2d Dep’t 2018) (“Pursuant to 22 NYCRR 202.27(b), a court has the discretion to direct dismissal of a complaint where the plaintiff fails to appear or is not ready to proceed. Here, the Supreme Court based its decision to dismiss the complaint upon the plaintiffs' lack of readiness to proceed on November 19, 2015, a date to which the court adjourned the matter despite its awareness that the plaintiffs' counsel would not be available. Under the circumstances presented, the court improvidently exercised its discretion in, sua sponte, directing dismissal of the complaint (citation omitted).”).

CPLR 3408 - Mandatory settlement conference in residential foreclosure action

CPLR 3408 - Action did not mandate settlement conference

Nationstar Mtge., LLC v. Turcotte, 161 A.D.3d 1090 (2d Dep’t 2018) (“Finally, the defendants’ contention that the plaintiff’s misconduct deprived them of a mandatory settlement conference to which they were entitled pursuant to CPLR 3408(a) is without merit. Former CPLR 3408, which was in effect at the time this action was commenced on June 25, 2008 (citation omitted), ‘applied only to foreclosure actions involving high-cost home loans or subprime or nontraditional home loans’ (citation omitted). Contrary to the defendants’ contention, their adjustable rate note did not fall under the definition of a ‘nontraditional home loan[ ]’ so as to mandate a settlement conference (citations omitted).”).

ARTICLE 41 - TRIAL BY JURY

CPLR 4102 - Jury demand and waiver

CPLR 4102

David L. Ferstendig, Further Appellate Division Conflicts, and One Resolved, 689 N.Y.S.L.D. 3 (2018)

Asserting Equitable Counterclaims and Right to a Jury Trial

Three of the four Appellate Division Departments (the First, Second and Third Departments) hold that a defendant waives his or her right to a jury trial on all legal claims, including the plaintiff’s claim, when asserting an equitable counterclaim based on the same transactions. See Cannon Point N., Inc. v. City of New York 87 A.D.3d 861, 865–66 (1st Dep’t 2011); Seneca v. Novaro, 80 A.D.2d 909, 910 (2d Dep’t 1981); Hickland v. Hickland, 100 A.D.2d 643, 644 (3d Dep’t 1984).

The Fourth Department, however, holds to the contrary. Most recently, in Pittsford Canalside Props., LLC v. Pittsford Vill. Green, 154 A.D.3d 1303 (4th Dep’t 2017), the court explained the reason behind its dissent from the other departments:

[C]ontrary to plaintiff’s contention on its cross appeal, we conclude that the court properly denied plaintiff’s motion to strike defendants’ demand for a jury trial. We have declined to apply the prevailing rule in the other Departments of the Appellate Division that a defendant waives his or her right to a jury trial on jury-triable causes of action in the complaint by interposing an equitable counterclaim based on the same transaction. The plain text of CPLR 4102 (c) does not address that issue, and the rule that prevails in the other Departments would force defendants to commence separate actions to assert equitable counterclaims, thereby encouraging the prosecution of inefficient and wasteful parallel actions. We conclude, however, that "[t]he need for a full relitigation of the equitable claims and the possibility of inconsistent results can be avoided by permitting the legal action and the equitable claims to be tried at the same time" (citations omitted).

Id. at 1305.

CPLR 4111 - General and specific verdicts and written interrogatories

CPLR 4111(c) - Trial court properly vacated jury award and ordered new trial on damages based on clearly inconsistent verdict-High-low agreement of no moment

Flores v. 731 S. Blvd. LLC, 154 A.D.3d 518, 63 N.Y.S.3d 319 (1st Dep’t 2017) (“Defense counsel’s contentions that the trial court was without authority to order a new trial on damages given the parties’ high-low settlement agreement, and because neither party raised the issue of an inconsistent verdict, are unavailing. A high-low settlement between parties is a conditional settlement, triggered only when there is a proper verdict (citations omitted). CPLR 4111(c) provides, inter alia, that a court “shall order a new trial” when a jury’s answers to interrogatories “are inconsistent with each other and one or more is inconsistent with the general verdict.” Here, Supreme Court properly vacated the jury award and ordered a new trial on damages based on the clearly inconsistent verdict (citations omitted).”).

ARTICLE 42 - TRIAL BY THE COURT

CPLR 4201 - Powers of referees to report

CPLR 4201 - “Inasmuch as the referee's role was to hear and report, Supreme Court, as ‘the ultimate arbiter of the dispute,’ was under no corresponding obligation to incorporate the first report into a judgment”

Oropallo v. Bank of Am. Home Loans, LP, 2018 NY Slip Op 04799 (3d Dep’t 2018) (“It is well- settled that a trial court maintains the discretion to cure mistakes, defects and irregularities that do not affect a substantial right of a party (citations omitted), including the discretion to clarify a prior order and judgment to reflect the true intent of the court's original holding (citations omitted). In consideration of Supreme Court's April 2013 order and judgment directing any subsequently appointed referee to ‘hear and report’ as to the value of defendants' equitable mortgage lien (citation omitted), the inconsistent language that was subsequently incorporated into the August 2013 order of reference and plaintiffs' subsequent motion to confirm — which motion is only required where a referee has been appointed to ‘hear and report’ (citation omitted) — it was not inappropriate for Supreme Court to clarify in its February 2015 order that its intent was for the appointed referee to ‘hear and report.’ Under the circumstances, therefore, neither defendants' failure to object to the reference nor their participation in the subsequent hearing served as a waiver of or consent to the authority of the referee as indicated in the order of reference (citation omitted). Thus, inasmuch as the referee's role was to hear and report, Supreme Court, as ‘the ultimate arbiter of the dispute,’ was under no corresponding obligation to incorporate the first report into a judgment (citations omitted).”).

CPLR 4201 - Referee had no jurisdiction to determine, but only to hear and report

Matter of Rose v. Simon, 2018 NY Slip Op 04736 (2d Dep’t 2018) (“A referee derives authority from an order of reference by the court (citations omitted). Here, as correctly asserted by the mother, the order of reference did not authorize the Court Attorney Referee to hear and report or to hear and determine a contested family offense petition. The Court Attorney Referee therefore lacked jurisdiction to dismiss the mother's family offense petition in this instance (citation omitted). Accordingly, the family offense matter must be remitted to a judge of the Family Court for a new determination. . . . Upon our review of the record, however, we find no indication that the parties stipulated to the reference in the manner prescribed by CPLR 2104, and, absent such stipulation, the Court Attorney Referee had the power only to hear and report her findings (citations omitted). We further find that the mother did not consent to the reference merely by participating in the proceeding without expressing her desire to have the matter tried before a judge (citations omitted). The order of reference must therefore be deemed an order to hear and report. Thus, the Court Attorney Referee had no jurisdiction to determine, but only to hear and report, with respect to the parties' respective rights of custody and visitation (citation omitted). Accordingly, the portion of the order dated May 19, 2017, which determined custody and visitation, is deemed a report (see CPLR 4320[b]), and the custody matter must be remitted for further proceedings pursuant to CPLR 4403 before a judge of the Family Court.”).

CPLR 4213 - Decision of the court

CPLR 4213(b) - Court must state facts it deems essential

Kieran v. Sinetos, 145 A.D.3d 987, 45 N.Y.S.3d 131 (2d Dep’t 2016) (“Under CPLR 4213(b), a court must state ‘the facts it deems essential’ to a decision. The purpose of this requirement is to facilitate meaningful appellate review (citation omitted). Here, the Supreme Court failed to state any basis for its decision. Remittal, however, is not necessary because the evidence presented was legally insufficient to establish the plaintiff’s entitlement to recovery (citation omitted).”).

CPLR 4213(b) - Itemized nonjury verdicts

Nunez v. Bardwil, 145 A.D.3d 909, 43 N.Y.S.3d 490 (2d Dep’t 2016) (“CPLR 4213(b) requires that nonjury verdicts be itemized, and this rule applies to inquests (citation omitted). Here, the Supreme Court’s failure to itemize the elements of damages, and state the facts it deemed essential in determining the award of damages, renders appellate review of the damages award impossible (id.). Moreover, in light of the Supreme Court’s failure to hear the testimony of the parties’ experts or even to review their records, a new inquest is warranted. A new inquest is also warranted because it is alleged that admissible evidence was improperly excluded (citation omitted).”).

ARTICLE 43 - TRIAL BY A REFEREE

CPLR 4311 - Order of reference

CPLR 4311 - Court Attorney Referee lacked jurisdiction to issue order without parties’ consent

Matter of Kohn v. Sanders, 152 A.D.3d 597, 55 N.Y.S.3d 671 (2d Dep’t 2017) (“Appeal by the father from an order of the Family Court, Kings County (Denise M. Valme-Lundy, Ct. Atty. Ref.), dated May 17, 2016. The order dismissed the father’s petition for modification of an order of custody and visitation. ORDERED that the order is reversed, on the law, without costs or disbursements, and the matter is remitted to the Family Court, Kings County, for a new determination of the father’s petition. A referee derives authority from an order of reference by the court (see CPLR 4311), which can be made only upon consent of the parties, except in limited circumstances not applicable here (citations omitted). Here, the parties did not have an order of reference with respect to this proceeding. Thus, the Court Attorney Referee lacked jurisdiction to issue the order dated May 17, 2016 (citations omitted), and we remit the matter to the Family Court, Kings County, for a new determination of the father’s petition.”).

CPLR 4313 - Notice

CPLR 4313 - Referee’s failure to give notice of proceedings not fatal

Wells Fargo Bank N.A. v. Javier, 153 A.D.3d 1199, 60 N.Y.S.3d 675 (1st Dep’t 2017) (“The referee’s failure to give notice of the proceedings (see CPLR 4313) to ascertain the amount due on the mortgage does not require reversal of the judgment of foreclosure and sale. Both parties submitted evidence to the court — the ultimate arbiter of the issue — in their motions to confirm or vacate the referee’s report, and the court correctly found that defendant’s evidence failed to rebut plaintiff’s evidence (citation omitted).”).

CPLR 4319 - Decision

CPLR 4319 - Referee’s determination of default rate of interest under note and mortgage was plainly within scope of issues delineated in the order of reference

MMAL Corp. v. Edrich, 156 A.D.3d 780, 67 N.Y.S.3d 261 (2d Dep’t 2017) (“Where a referee is appointed to hear and determine, rather than to hear and report (see CPLR 4201), the referee possesses ‘all the powers of a court in performing a like function’ (CPLR 4301), and his or her ‘decision shall stand as the decision of a court’ (CPLR 4319). ‘Since the actions of referees when

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. they are assigned to determine an issue are tantamount to those of any sitting Supreme Court Justice, the Supreme Court may only review whether the referee exceeded the scope of the issues delineated in the order of reference’ (citation omitted). Here, the order of reference specifically gave the Referee, in relevant part, the power ‘to determine the issue of the default rate of interest.’ Since the Referee’s determination of the default rate of interest under the note and mortgage was plainly within the scope of the issues delineated in the order of reference, the Supreme Court properly denied that branch of the plaintiff’s cross motion which was to reject that portion of the Referee’s decision.”).

ARTICLE 44 - TRIAL MOTIONS

CPLR 4401 - Motion for judgment during trial

CPLR 4401 / 3212 - Prior denial of defendants’ summary judgment motion does not preclude dismissal at conclusion of the plaintiff’s case at trial

Zebzda v. Hudson St., LLC, 156 A.D.3D 851, 65 N.Y.S.3d 727 (2d Dep’t 2017) (“The plaintiff’s contention that the Supreme Court’s prior denial of the defendants’ motion for summary judgment dismissing the complaint precluded dismissal at the conclusion of the plaintiff’s case at trial is without merit (citations omitted).”).

CPLR 4404 - Post trial motions

CPLR 4404

David L. Ferstendig, Appellate Division Applies Wrong Test in Setting Aside Jury Verdict, 673 N.Y.S.L.D. 2 (2016).

Killon v. Parrotta, 2016 N.Y. Slip Op. 07048 (October 27, 2016), was a personal injury action arising out of a fight between the plaintiff and defendant. It was a he-said, he-said situation, but it did involve a she. The plaintiff had been a longtime friend of the defendant’s wife. While drunk, the plaintiff made a threatening call to the defendant about his treatment of his wife. The defendant then drove 20 miles in the middle of the night to the plaintiff’s home. What happened next is the subject of dispute. Defendant says that when the plaintiff saw him, plaintiff left his home with a maul hammer handle, prompting the defendant to go back to his truck to retrieve a bat. The plaintiff then encouraged his dog to attack the defendant and swung the maul handle at him, grazing the back of the defendant’s head. Defendant alleged that he could not retreat because of “bad knees” and so he swung his bat at the plaintiff. Defendant then “fled the scene.” Plaintiff tells the story a bit differently. The plaintiff told the defendant to repeatedly leave. When the plaintiff stepped off the porch he threw the maul handle on the ground, not at the defendant, and then the defendant swung his bat at the plaintiff, causing extensive injuries to his jaw. A witness present for the incident stated that the defendant, upon his arrival, came out of his truck carrying his bat.

Nice story, but why did I just take away a minute of your life! Ah, because the issue here surrounds whether the defendant was the “initial aggressor” and whether the Appellate Division used the proper standard in evaluating the jury determination.

At trial, the court instructed the jury that the “initial aggressor” is “the person who first attacks or threatens to attack … [t]he actual striking of the first blow or inflicting the first wound is not in and of itself determinative of the question of who was the initial aggressor.” Id. at *2. Significantly, if the defendant was found to be the “initial aggressor,” the jury was required to find that he did not act in self-defense.

The jury unanimously found that defendant battered the plaintiff by striking him with a bat, but also found that the defendant acted in self-defense. The trial court denied plaintiff’s motion to set aside the verdict. In 2012, the Appellate Division reversed and ordered a new trial, finding that “‘no fair interpretation of the evidence’ supported ‘the verdict finding that defendant acted in self- defense’ inasmuch as it was predicated upon ‘a conclusion that defendant was not the initial aggressor in the encounter’.” Id.

At the retrial, the trial court stated that it was constrained by the 2012 Appellate Division holding, as a matter of law, that the defendant was the initial aggressor, and thus denied defendant’s request for a self-defense jury charge. The second jury then found that the defendant had committed a battery and awarded damages. In 2015, the Appellate Division affirmed. The appeal of the 2015 Appellate Division order to the Court of Appeals brought up for review the earlier non-final 2012 order. The Court stressed that where the Appellate Division finds a verdict to be against the weight of the evidence, the remedy is to remit for a new trial. Conversely, “where the Appellate Division intends to hold that a jury verdict is insufficient as a matter of law, it must first determine that the verdict is ‘utterly irrational’.” Id. at *3.

In the 2012 Order, the Appellate Division found, in essence, that the verdict was against the weight of the evidence but the effect was to hold, as a matter of law, that the defendant was the initial aggressor and thus the justification defense was unavailable. Such a holding could only be reached by concluding that the verdict was utterly irrational, but the Appellate Division did not use that test.

The Court stated that whether a verdict is utterly irrational is a question of law, in which case the Court could look at the trial evidence and then make its own determination. The Court held that, based on the jury charge given, the first jury’s conclusion that the defendant was not the initial aggressor and acted in self-defense was not utterly irrational based on the conflicting versions of the events and remitted the case to the Supreme Court for yet a third trial. It noted that normally it would have remitted to the Appellate Division to determine whether the self-defense verdict was against the weight of the evidence. However, “under these unusual circumstances where the Appellate Division already performed that analysis and decided the case should be retried,” the Court felt it was “most appropriate” to remit the case directly to the Supreme Court for a new trial. Id. at *4 n.2.

CPLR 4404 - Court can consider an unpreserved error in a jury charge which is fundamental

Vallone v. Saratoga Hosp., 141 A.D.3d 886, 35 N.Y.S.3d 544 (3d Dep’t 2016) (“At trial, plaintiff made a general objection to the comparative negligence instruction on the ground that there was no evidentiary basis for the charge, but neither requested that the jury be charged to exclude comparative negligence from its consideration of the malpractice claims nor objected to the proposed special verdict sheet. Thus, plaintiff failed to preserve this challenge to the instruction ((citations omitted). However, this Court may exercise its discretion to order a new trial when an unpreserved error in a jury charge is fundamental — that is, ‘so significant that the jury was prevented from fairly considering the issues at trial’ ((citations omitted). Here, the jury was neither instructed to limit its consideration of plaintiff’s comparative negligence, nor that defendant’s liability extended only to that portion of plaintiff’s injuries attributable to its malpractice. The jury was thus prevented from fairly considering the central issue of damages. The errors were further compounded by the failure to instruct the jury ‘to determine the total amount of damages sustained by plaintiff, undiminished by any percentage of fault’ ((citation omitted). PJI 2 -36 sets forth three essential steps to be followed by the jury in apportioning liability and calculating damages, and the third step — which instructs the jury to determine the total damage award without reference to any percentage of fault — is essential to avoid juror confusion and the risk of a double reduction of the plaintiff’s recovery ((citations omitted). Here, it is impossible to determine whether the jury intended the amount that it awarded to represent the total damage award or plaintiff’s 10% share following the erroneous apportionment of fault. Accordingly, we find that the combined errors in the charge are fundamental, and that a new trial on the issue of plaintiff’s damages is warranted in the interest of justice (citations omitted).”).

CPLR 4404 - Setting aside verdict against weight of evidence

Matter of Eighth Jud. Dist. Asbestos Litig., 141 A.D.3d 1127, 35 N.Y.S.3d 615 (4th Dep’t 2016) (“We reject defendant’s further contention that the apportionment of 35% liability to defendant is against the weight of the evidence, and thus that the court erred in denying that part of its postverdict motion to set aside the verdict on that ground. It is axiomatic that a verdict may be set aside as against the weight of the evidence only if “the evidence so preponderate[d] in favor of the [defendant] that [the verdict] could not have been reached on any fair interpretation of the evidence” (Lolik v Big V Supermarkets, 86 NY2d 744, 746 [internal quotation marks omitted]), and that is not the case here. Indeed, the court properly determined that defendant did not meet its burden of establishing the equitable shares of fault attributable to other tortfeasors in order to reduce its own liability for damages (citations omitted).”).

CPLR 4404

David L. Ferstendig, Majority of Court of Appeals Reverses Order Granting Defendant’s Motion to Set Aside Verdict, 678 N.Y.S.L.D. 2,3 (2017).

For a trial court to determine as a matter of law that a jury verdict is unsupported by sufficient evidence, it must conclude “that there is simply no valid line of reasoning and permissible inferences which could possibly lead rational men to the conclusion reached by the jury on the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. basis of the evidence presented at trial.” Cohen v. Hallmark Cards, Inc.. 45 N.Y.2d 493, 499 (1978).

In Obey v. City of New York, 2017 N.Y. Slip Op. 02590 (April 4, 2017), the plaintiff, a heroin addict, was traveling from a methadone clinic when he slipped off of a subway platform and was injured by a train. He told a treating psychologist that he was high on Xanax and Klonopin, psychoactive drugs that can cause dizziness and falling, if abused. The plaintiff could not remember anything from the time he slipped until he was tended to by medical personnel. At trial, he claimed his memory loss was caused when he slipped and hit his head, not from taking illegal drugs.

During the approximately 45 minute period covering the time that the plaintiff entered the subway station until he was discovered on the tracks, at least three trains passed through the station. The plaintiff claimed that the second train contacted him. While none of the train operators saw the plaintiff before the incident, a large pool of blood was found on the tracks; what appeared to be blood stains were on four cars of the first train; the operator of the second train reported seeing white sneakers on the train tracks; and the third train was alerted to the incident, permitting the train operator to stop the train.

The jury returned a verdict in plaintiff’s favor, apportioning 60 percent fault to the plaintiff and 40 percent to the New York City Transit Authority (NYCTA), and awarding nearly $2 million in damages. The trial court granted the defendant’s post-trial motion to set aside the verdict on the issue of liability, finding that the plaintiff had failed to establish that the operator of the second train (Lopez) was negligent or caused plaintiff’s injuries. In a 3–2 decision, the Appellate Division affirmed, finding that plaintiff failed to satisfy his burden to show that the second train caused his injuries. The court pointed to the bloodstains on the first train, which were lacking on the second train. Moreover, the fact that Lopez observed sneakers on the tracks did not establish which train injured the plaintiff. Finally, the Appellate Division concluded that the plaintiff failed to establish prima facie that, had Lopez activated the train’s emergency brake when he saw the sneakers, the incident could have been avoided (assuming the train caused the injury).

In a very brief decision, a majority of the Court of Appeals reversed, holding that,

[l]egally sufficient evidence supported the jury’s finding that defendant New York City Transit Authority was negligent and that its negligence was a proximate cause of plaintiff’s injury.

Id. at *1.

In a dissent, Judge Garcia found that the plaintiff had failed to sustain his burden of proving that the second train caused his injuries, concluding that the physical evidence pointed solely to the first train.

[W]hat appeared to be bloodstains were discovered on four cars of the first train, while no such stains were discovered on the second train. In an attempt to refute

the physical evidence, plaintiff’s expert claimed that the apparent bloodstains may actually have been “grape juice,” “pop/soda,” or rat blood, and that the weight and heat of the train may have cauterized plaintiff’s wound. Not only are these claims incredible on their face, but they are undermined by plaintiff’s own evidence. For instance, plaintiff contends that his wound may have instantly cauterized — to explain the absence of any blood on the second train — while simultaneously pointing to a “large pool of blood” on the tracks for purposes of determining the accident location.

Id. at *2.

Moreover, Judge Garcia also found that the plaintiff did not make a prima facie showing that the train operator of the second train was negligent. He rejected plaintiff’s expert’s claim that because Lopez stated that he saw plaintiff’s sneakers when entering the station, he had enough time to stop the train in time, by engaging the emergency brake.

However, plaintiff’s expert implicitly rejected the proposition that the operator observed the sneakers immediately upon entering the station — a 400 foot distance — by testifying that the train’s headlights would not have illuminated the sneakers until, at the earliest, “151.5 feet from the front of the train.” Although the expert opined that 151.5 feet would have been a sufficient distance to stop the train, there is no record evidence to support the expert’s assumption that the operator actually observed the sneakers from a distance of 151.5 feet. Rather, according to the operator’s trial testimony as well as his written report from the day of the accident, the operator did not see the sneakers until the train was almost fully stopped near the end of the station. In the absence of any credible evidence that the operator had adequate time to stop the train, the jury’s verdict relied on unsubstantiated speculation regarding the operator’s negligence (citation omitted).

Id. at *2-3.

CPLR 4404 - Jury verdict set aside as contrary to the weight of the evidence because it was not supported by any fair interpretation of the evidence

Robinson v. Brooklyn Union Gas Co., 160 A.D.3d 999, 72 N.Y.S.3d 454 (2d Dep’t 2018) (“‘A jury verdict should not be set aside as contrary to the weight of the evidence unless the jury could not have reached the verdict by any fair interpretation of the evidence’ (citation omitted). This principle also applies to a jury's apportionment of fault (citation omitted). Here, the jury's determination that the plaintiff was 80% at fault was not supported by a fair interpretation of the evidence in light of the undisputed evidence regarding the condition of the street (citation omitted). An apportionment of 55% of the fault to the plaintiff and 45% of the fault to the defendant City of New York better reflects a fair interpretation of the evidence (citation omitted).”).

CPLR 4404 - Court’s errors in failing to properly charge the jury and add the interrogatory requested by the plaintiffs prejudiced a substantial right and warrants a new trial

Duran v. Temple Beth Sholom, Inc., 155 A.D.3d 690, 64 N.Y.S.3d 278 (2d Dep’t 2017) (“‘A motion pursuant to CPLR 4404(a) to set aside a verdict and for a new trial in the interest of justice encompasses errors in the trial court’s rulings on the admissibility of evidence, mistakes in the charge, misconduct, newly discovered evidence, and surprise’ (citations omitted). In considering such a motion, ‘[t]he Trial Judge must decide whether substantial justice has been done, whether it is likely that the verdict has been affected . . . and must look to his [or her] own common sense, experience, and sense of fairness rather than to precedents in arriving at a decision’ (Micallef v Miehle Co., Div. of Miehle-Goss Dexter, 39 NY2d 376, 381 [citation omitted], quoting Weinstein- Korn-Miller, NY Civ Prac ¶ 4404.11; see Morency v Horizon Transp. Servs., Inc., 139 AD3d at 1023). Here, the Supreme Court erred in denying the plaintiffs’ request to ask the jury to determine not only whether the temple violated Labor Law § 240(1), but also to determine whether Duran fell off the beam (citations omitted). Under the particular circumstances of this case, this constituted a fundamental error warranting a new trial because the court’s instructions failed to explain to the jury that, in light of arguably inconsistent accounts of how the accident occurred, the jury was entitled to find that Duran did not fall from the beam or, alternatively, that he did fall from the beam but no safety device was required under Labor Law § 240(1). Further, there was sufficient evidence of juror confusion with respect to this issue (citations omitted). Notably, the jury requested a readback of Labor Law § 240(1). The court’s errors in failing to properly charge the jury and add the interrogatory requested by the plaintiffs prejudiced a substantial right and warrants a new trial (citations omitted).For that reason, the Supreme Court should have granted that branch of the plaintiffs’ motion which was pursuant to CPLR 4404(a) to set aside the verdict in the interest of justice and for a new trial on the cause of action alleging a violation of Labor Law § 240(1) insofar as asserted against the temple (citation omitted).”) (citing Weinstein-Korn- Miller).

ARTICLE 45 - EVIDENCE

CPLR 4503 - Attorney

CPLR 4503 - Common-Interest privilege

David L. Ferstendig, Divided Court of Appeals Imposes Litigation Requirement on Common- Interest Privilege, 668 N.Y.S.L.D. 1, 2 (2016).

Generally, the presence of a third party to a communication between counsel and client waives the attorney-client privilege. The common-interest privilege, however, is an exception. Under this doctrine, the privilege will not be destroyed by the third party’s presence “if the communication is for the purpose of furthering a nearly identical legal interest shared by the client and the third party.” Ambac Assur. Corp. v. Countrywide Home Loans, Inc., 124 A.D.3d 129 (1st Dep’t 2014). There was a conflict among the Appellate Division Departments as to whether the communication has to be made in connection with a pending action or “in reasonable anticipation of litigation.”

The Second Department had taken this narrower view, while the First Department in Ambac ruled that the communication need not be tied to litigation. That was until a divided New York State Court of Appeals stepped in and held there to be a litigation requirement.

Ambac concerned a discovery dispute arising out of an action brought by Ambac, a financial guaranty insurer, that guaranteed payments on residential mortgage-backed securities (RMBS) issued by Countrywide and related entities. Ambac claimed that Countrywide fraudulently induced it to insure the RMBS transactions and breached contractual representations. Ambac also sued Bank of America Corporation (BOA) based on its merger with Countrywide. The crux of the discovery dispute was BOA’s withholding of some 400 communications that occurred between BOA and Countrywide after the merger plan was signed but before the merger closed. BOA argued that the communications were protected from disclosure by the attorney-client privilege because they related to legal issues that both companies had to resolve jointly to successfully complete the merger. BOA claimed that the merger agreement “evidenced the parties’ shared legal interest in the merger’s ‘successful 2016completion’ as well as their commitment to confidentiality, and therefore shielded the relevant communications from discovery.” Ambac Assur. Corp. v. Countrywide Home Loans, Inc., 2016 N.Y. Slip Op. 04439 (June 9, 2016) at ∗2–3.

Ambac moved to compel, arguing that because both BOA and Countrywide had shared voluntarily confidential material before the merger closed, they had waived the attorney-client privilege. An appointed special referee granted Ambac’s motion, noting that generally the exchange of privileged communications constitutes a waiver of the attorney-client privilege. The referee added that the “common interest” doctrine is an exception to the waiver rule, but found that for the exception to apply there must be a common legal interest in a pending or reasonably anticipated litigation, which was not the case here.

BOA moved to vacate the special referee’s decision and order, arguing that its communications with Countrywide were protected even in the absence of pending anticipated litigation. The Supreme Court denied the motion, finding that there had to be a reasonable anticipation of litigation for the common interest doctrine to apply. The Appellate Division reversed, concluding that the better policy would be not to require that the communication be tied to litigation.

A majority of the New York State Court of Appeals reversed the Appellate Division order, holding that the litigation requirement “that has historically existed in New York” applied and that the common-interest doctrine should not be expanded “to protect shared communications in furtherance of any common legal interest.” Id. at ∗6. It found that the benefits in extending the doctrine to communications made in the absence of pending or anticipated litigation were outweighed by the substantial loss of relevant evidence and the potential for abuse. The Court noted that in a non-litigation setting, there may be parties asserting common legal interests, who are really protecting non-legal or exclusively business interests. It rejected BOA’s argument that the common-interest doctrine should be coextensive with the attorney-client privilege, which is not tied to the contemplation of litigation

because the doctrine itself is not an evidentiary privilege or an independent basis for the attorney client privilege (citation omitted). Rather, it limits the

circumstances under which attorneys and clients can disseminate their communications to third parties without waiving the privilege, which our courts have reasonably construed to extend no further than communications related to pending or reasonably anticipated litigation.

Id. at *8.

The dissent pointed out that

[g]iven that the attorney-client privilege has no litigation requirement and the reality that clients often seek legal advice specifically to comply with legal and regulatory mandates and avoid litigation or liability, the privilege should apply to private client-attorney communications exchanged during the course of a transformative business enterprise, in which the parties commit to collaboration and exchange of client information to obtain legal advice aimed at compliance with transaction-related statutory and regulatory mandates.

Id. at *9.

The dissent emphasized that a majority of federal courts and a significant number of state courts that have addressed the issue have held that the privilege applied even if litigation is not pending or reasonably anticipated.

CPLR 4503 - Common-interest privilege – In camera review to determine whether communications were made in reasonable anticipation of litigation

Kenyon & Kenyon LLP v. SightSound Tech., LLC, 151 A.D.3d 530, 58 N.Y.S.3d 298 (1st Dep’t 2017) (“Since the court issued the order deciding plaintiff’s motion to compel, the Court of Appeals has clarified that the common interest doctrine preserves the privileged status of an attorney-client communication disclosed to a third party only if the communication was shared ‘in furtherance of a common legal interest in pending or reasonably anticipated litigation’ (citation omitted). Therefore, we reverse the denial of plaintiff’s motion to compel the production of an unredacted copy of the minutes of the indicated SST board meeting, at which an attorney provided legal advice to the SST board in the presence of two persons (Sohn and Giordano) identified in the minutes as representatives of DMT, and direct that the court conduct an in camera review of the unredacted minutes to determine whether the redacted material comprises attorney-client communications made in reasonable anticipation of litigation in which SST and DMT would have a common interest. We note, however, that, because plaintiff did not challenge the status of Sohn and Giordano as representatives of DMT in its motion to compel, that matter, which plaintiff raises for the first time on appeal, need not be considered upon the in camera review.”).

CPLR 4503 - Common interest privilege -further proceedings are necessary to determine whether the common-interest privilege applies

21st Century Diamond, LLC v. Allfield Trading, LLC, 142 A.D.3d 913, 38 N.Y.S.3d 151 (1st Dep’t 2016) (“Since any otherwise applicable common-interest privilege has not been waived, in light of the recent Court of Appeals decision clarifying the scope of the common-interest privilege (Ambac Assur. Corp. v Countrywide Home Loans, Inc., 27 NY3d 616 [2016]) (which was issued after Supreme Court rendered its order), further proceedings are necessary to determine whether the common-interest privilege applies in the first instance to the documents as to which Sterling asserts privilege. In deciding the motion to compel, Supreme Court noted that a question of fact exists as to whether Sterling entered into the common-interest agreement with Exelco to protect its business relationship with Exelco (in which case the common-interest privilege would not apply under Ambac) or out of a reasonable concern that plaintiffs might decide to add Sterling as a defendant (in which case the common-interest privilege would apply under Ambac).”).

CPLR 4504- Doctor, dentist, podiatrist, chiropractor and nurse

CPLR 4504 / 3101 - Disclosure of photographs constituting breach of fiduciary duty

Skokan v. Peredo, 151 A.D.3d 1096, 58 N.Y.S.3d 110 (2d Dep’t 2017) (“The defendant failed to demonstrate, prima facie, that the disclosure of the plaintiff’s photographs did not constitute a breach of fiduciary duty, as her submissions failed to eliminate triable issues of fact as to whether the plaintiff consented to that disclosure (citations omitted). The defendant failed to establish, prima facie, that the disclosure was permitted under the consent forms signed by the plaintiff, and in particular, that the photographs were limited to the plaintiff’s ‘treated sites’ or that the photographs were disclosed for ‘teaching purposes.’ Nor did the defendant establish, prima facie, that a verbal consent to the disclosure would have been valid under the circumstances of this case, or, if a verbal consent would have been valid, whether the plaintiff provided such verbal consent. Since the defendant failed to establish her prima facie entitlement to judgment as a matter of law dismissing the third cause of action, alleging breach of fiduciary duty, the Supreme Court correctly denied that branch of the motion, regardless of the sufficiency of the plaintiff’s opposition papers (citation omitted).”).

CPLR 4515 - Form of expert opinion

CPLR 4515 - Expert opinion on specific causation in toxic tort case

Dominick v. Charles Millar & Son Co., 149 A.D.3d 1554, 54 N.Y.S.3d 233 (4th Dep’t 2017) (“Plaintiff testified that he was exposed to asbestos dust from asbestos boards and cement supplied by the Millar defendants that were used in the heat treat area of a pneumatic-tool making plant. The hypothetical question that plaintiff asked his expert was based on plaintiff’s testimony or was otherwise ‘fairly inferable from the evidence’ (citations omitted). With respect to specific causation, the Court of Appeals held in Parker v. Mobil Oil Corp. (citation omitted) that the expert

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. opinion must set forth that the plaintiff ‘was exposed to sufficient levels of the toxin to cause the [injuries]’ (citation omitted). However, as the Court of Appeals later wrote, ‘Parker explains that precise quantification’ or a dose-response relationship’ or an exact numerical value’ is not required to make a showing of specific causation’ (citation omitted). There simply ‘ must be evidence from which the factfinder can conclude that the plaintiff was exposed to levels of [the] agent that are known to cause the kind of harm that the plaintiff claims to have suffered’ ‘ (citation omitted). Here, plaintiff’s expert opined that, if a worker sees asbestos dust, that is a ‘massive exposure . . . capable of causing disease.’ Contrary to the Millar defendants’ contention, the expert’s opinion, considered along with the rest of her testimony, was sufficient to establish specific causation (citations omitted).”).

CPLR 4515 - Foundation for expert opinion

David L. Ferstendig, Plaintiff’s Experts Fail to Establish That Decedent Was Exposed to Sufficient Levels of Toxins, 677 N.Y.S.L.D. 2, 3 (2017).

The Court of Appeals decisions in Parker v. Mobil Oil Corp., 7 N.Y.3d 434 (2006) and Cornell v. 360 W. 51st St. Realty, LLC, 22 N.Y.3d 762 (2014) are the seminal cases detailing the general requirements for the admission of an expert’s scientific opinions in toxic tort cases. Thus, “it is not always necessary for a plaintiff to quantify exposure levels precisely or use the dose-response relationship, provided that whatever methods an expert uses to establish causation are generally accepted in the scientific community.” Parker, 7 N.Y.3d at 448. More recently, in Sean R. v. BMW of N. Am., LLC, 26 N.Y.3d 801 (2016), discussed in detail in the May 2016 edition of the Law Digest, the Court reiterated that “we have never ‘dispensed with a plaintiff’s burden to establish sufficient exposure to a substance to cause the claimed adverse health effect.’” Id. at 808.

Matter of New York City Asbestos Litig., 48 N.Y.S.3d 365 (1st Dep’t 2017) (“Juni”) is an asbestos- related case dealing with the admission of expert testimony. In Juni, plaintiff claimed that the decedent contracted mesothelioma from his alleged exposure as an auto mechanic to various asbestos-containing products. In this decision, the claims related to exposure to asbestos dust from brakes, clutches, and manifold gaskets in defendant Ford Motor Company vehicles. While the jury found for the plaintiff, the trial court granted Ford’s motion to set aside the verdict, pursuant to CPLR 4404(a).

What was really at issue here was whether asbestos cases should be treated like other toxic tort cases. You may ask (with Passover approaching), what makes this type of case different from all other toxic tort cases? The question stems at least in part from the fact that it is basically accepted by the courts that mesothelioma is (only) caused by exposure to asbestos. Moreover, in practice, in New York state courts, allegations of any alleged exposure to a product containing any amount of asbestos have generally sufficed.

A majority of the First Department in Juni stated unequivocally, however, that the Parker and Cornell requirements apply to asbestos-exposure cases, rejecting the dissent’s suggestion

that applying the same criteria would set an insurmountable standard for asbestos claims. However, there is no valid distinction to be made between the difficulty of establishing exposure to, say, benzene in gasoline and exposure to asbestos. In each type of matter, a foundation must be made to support an expert’s conclusion regarding causation.

48 N.Y.S.3d 365 at ∗2.

It also rejected plaintiff’s claim that the court’s earlier decision in Lustenring v. AC&S, Inc., 13 A.D.3d 69 (1st Dep’t 2004), lv. denied, 4 N.Y.3d 708 (2005), or other asbestos cases have somehow altered the Court of Appeals’ standards. In fact, each of those cases was decided based on its discrete set of facts and the expert testimony there established that the extent and quantity of asbestos dust exposure was sufficient to cause mesothelioma. Thus,

the fact that asbestos, or chrysotile, has been linked to mesothelioma, is not enough for a determination of liability against a particular defendant; a causation expert must still establish that the plaintiff was exposed to sufficient levels of the toxin from the defendant’s products to have caused his disease (citation omitted). Even if it is not possible to quantify a plaintiff’s exposure, causation from exposure to toxins in a defendant’s product must be established through some scientific method, such as mathematical modeling based on a plaintiff’s work history, or comparing the plaintiff’s exposure with that of subjects of reported studies (citation omitted).

Juni, 48 N.Y.S.3d 365 at ∗2.

The court found that the plaintiff’s experts here did not “quantify the decedent’s exposure levels or otherwise provide any scientific expression of his exposure level with respect to Ford’s products.” Id. It agreed with the trial court’s decision not to accept plaintiff’s single exposure or cumulative exposure theories -

Neither of plaintiff’s experts stated a basis for their assertion that even a single exposure to asbestos can be treated as contributing to causing an asbestos-related disease. Moreover, reliance on the theory of cumulative exposure, at least in the manner proposed by plaintiffs, is irreconcilable with the rule requiring at least some quantification or means of assessing the amount, duration, and frequency of exposure to determine whether exposure was sufficient to be found a contributing cause of the disease (citation omitted).

Id.

The majority disagreed with the dissent that an alleged consensus in the scientific community that low dose asbestos exposure is sufficient to cause mesothelioma “entitles a particular plaintiff to be awarded judgment against a particular defendant by merely establishing some exposure to a product containing any amount of asbestos.” Id.

CPLR 4515 - Frye inquiry and other admissibility questions

Likos v. Niagara Frontier Tr. Metro Sys., Inc., 149 A.D.3d 1474, 53 N.Y.S.3d 739 (4th Dep’t 2017) (“We thus conclude that a Frye hearing was not warranted here, inasmuch as plaintiff failed even to contend that the theory espoused by defendant’s expert was based on novel scientific principles (citations omitted). We further conclude that the court did not abuse its discretion in refusing to preclude the testimony of defendant’s expert toxicologist. ‘ The Frye inquiry is separate and distinct from the admissibility question applied to all evidence—whether there is a proper foundation—to determine whether the accepted methods were appropriately employed in a particular case’ ‘ (citation omitted). On this point, plaintiff contends that ‘a study involving no more than twenty subjects is not an adequate foundation for [the expert’s] opinion that [decedent] had smoked mari[h]uana 15 minutes before the subject accident.’ The fact that a particular study may be inadequate is relevant to the weight to be given to the testimony concerning the study, but it does not preclude its admissibility (citation omitted). Furthermore, this was not the only study or test addressed in the expert disclosure, and we therefore cannot conclude that the court abused its discretion in denying the preclusion motion based on, inter alia, an apparent lack of foundation for the opinion or relevancy to the issues of causation and decedent’s negligence (citations omitted).”).

CPLR 4515 - Expert opinion- “The professional reliability exception to the hearsay rule enables an expert witness to provide opinion evidence based on otherwise inadmissible hearsay, provided it is demonstrated to be the type of material commonly relied on in the profession”

Tornatore v. Cohen, 2018 NY Slip Op 04145 (4th Dep’t 2018) (“We reject defendant's further contention that the court erred in denying her motion to strike the testimony of the life care planning expert on the ground that her opinion was principally based upon inadmissable hearsay statements of plaintiff's treating physician. It is well settled that ‘opinion evidence must be based on facts in the record or personally known to the witness’ (citation omitted). It is equally well settled, however, that an expert is permitted to offer opinion testimony based upon facts not in evidence where the material is ‘of a kind accepted in the profession as reliable in forming a professional opinion’ (citations omitted). ‘The professional reliability exception to the hearsay rule enables an expert witness to provide opinion evidence based on otherwise inadmissible hearsay, provided it is demonstrated to be the type of material commonly relied on in the profession’ (citations omitted), and ‘provided that it does not constitute the sole or principal basis for the expert's opinion’ (citations omitted).”).

CPLR 4518 - Business records

CPLR 4518 - Failure to lay a proper foundation for admission of records

Deutsche Bank Natl. Trust Co. v. Carlin, 152 A.D.3d 491, 61 N.Y.S.3d 16; (2d Dep’t 2017) (“The plaintiff failed to demonstrate the admissibility of the records relied upon by Rhodes under the business records exception to the hearsay rule (citation omitted). Rhodes, an employee of the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. current loan servicer, did not aver that he was personally familiar with the record keeping practices and procedures of BOA, the prior loan servicer. Thus, Rhodes failed to lay a proper foundation for admission of records concerning service of the required notices, and his assertions based on these records were inadmissible (citations omitted).”).

Cadlerock Joint Venture, L.P. v. Trombley, 150 A.D.3d 957, 54 N.Y.S.3d 127 (2d Dep’t 2017) (“Contrary to the Supreme Court’s determination, the plaintiff failed to demonstrate the admissibility of the records relied upon by its account officer under the business records exception to the hearsay rule (citation omitted), and thus, failed to establish a default in payment under the note. ‘A proper foundation for the admission of a business record must be provided by someone with personal knowledge of the maker’s business practices and procedures’ (citation omitted). Here, the plaintiff’s account officer did not allege that she was personally familiar with HSBC’s record keeping practices and procedures, and thus failed to lay a proper foundation for the admission of records concerning the payment history under the note (citations omitted). Inasmuch as the plaintiff’s motion was based on evidence that was not in admissible form, the plaintiff failed to establish its prima facie entitlement to judgment as a matter of law (citations omitted).”).

HSBC Mtge. Servs., Inc. v. Royal, 142 A.D.3d 952, 37 N.Y.S.3d 321 (2d Dep’t 2016) (“The plaintiff failed to demonstrate the admissibility of the records relied upon by Roesner under the business records exception to the hearsay rule (see CPLR 4518[a]), and, thus, failed to establish the appellant’s default in payment under the note. ‘A proper foundation for the admission of a business record must be provided by someone with personal knowledge of the maker’s business practices and procedures’ (citations omitted). Roesner, who was employed by the loan servicer to U.S. Bank, did not allege that he was personally familiar with the plaintiff’s record keeping practices and procedures. Thus, Roesner failed to lay a proper foundation for the admission of records concerning the appellant’s payment history (citations omitted), and his assertions based on these records were inadmissible (citation omitted). Inasmuch as the plaintiff’s motion was based on evidence that was not in admissible form, the plaintiff failed to establish its prima facie entitlement to judgment as a matter of law (citation omitted).”).

Deutsche Bank Natl. Trust Co. v Brewton, 142 A.D.3d 683, 37 N.Y.S.3d 25 (2d Dep’t 2016) (“The plaintiff failed to demonstrate that the records relied upon by Frye were admissible under the business records exception to the hearsay rule (see CPLR 4518[a]) because Frye, an employee of Wells Fargo, did not attest that she was personally familiar with the plaintiff’s record-keeping practices and procedures (citations omitted).).

CPLR 4518 - “The business records exception to the hearsay rule does not permit the receipt into evidence of entries based upon voluntary hearsay statements made by third parties not engaged in the business or under a duty in relation thereto (citation omitted).”

76th & Broadway Owner LLC v. Consolidated Edison Co. of N.Y. Inc., 160 A.D.3d 447, 74 N.Y.S.3d 527 (1st Dep’t 2018).

CPLR 4518(a) - Portion of records germane to diagnosis and treatment

Matter of Jonathan E. (John E.), 149 A.D.3d 1197, 51 N.Y.S.3d 252 (3rd Dep’t 2017) (“Here, while Family Court admitted the entirety of the father’s hospital records into evidence without any testimony as to which portions of the records were germane to the father’s diagnosis and treatment, it relied on only those portions of the hospital records that recorded the father’s admissions regarding his drug use. Under the circumstances of this case, it is beyond question that the father’s admissions of drug use, including the particular drugs used, the amount used and the frequency with which he used them, were relevant to a diagnosis of drug addiction and detoxification treatment and, thus, it was in the regular course of the hospital’s business to record such statements. Accordingly, inasmuch as the portions of the medical records relied on by Family Court were admissible under Family Ct Act § 1046 (a) (iv), any error in admitting any inadmissible portions of the hospital records was inconsequential (citations omitted).”).

CPLR 4518(d) - Rebuttal of presumption of paternity

Matter of Cayra M. v. Fotis B., 147 A.D.3d 479, 47 N.Y.S.3d 276 (1st Dep’t 2017) (“Respondent also presented evidence of a meritorious defense. Although the DNA test showed that there was a 99.9% probability that respondent was the child’s father, respondent stated that his identical twin brother, who was in the courtroom and was prepared to testify, had sexual relations with petitioner mother during the conception period. The brother’s testimony may have rebutted the presumption of paternity provided in Family Court Act § 532(a) and CPLR 4518(d) (citation omitted), if respondent was also able to demonstrate that he and his brother have identical DNA. Further, the best interests of the subject child are not furthered by a possibly erroneous paternity finding.”).

CPLR 4545 - Admissibility of collateral source of payment

CPLR 4545

David L. Ferstendig, Court of Appeals Splits on Application of CPLR 4545, 692 N.Y.S.L.D. 2-3 (2018).

Court Of Appeals Splits on Application of CPLR 4545

Do Accident Disability Retirement Benefits Act as an Offset Against Both Future Earnings and Pension Benefits?

Andino v. Mills, 2018 N.Y. Slip Op. 04273 (June 12, 2018), concerns the application of CPLR 4545, commonly referred to as the collateral source rule. The relevant portion (prior to an amendment which does not impact the analysis) provides that

[i]n any action brought to recover damages for personal injury … where the plaintiff seeks to recover for the cost of medical care, … loss of earnings or other economic loss, evidence shall be admissible for consideration by the court to establish that

any such past or future cost or expense was or will, with reasonable certainty, be replaced or indemnified, in whole or in part, from any collateral source [with some exceptions] …. If the court finds that any such cost or expense was or will, with reasonable certainty, be replaced or indemnified from any such collateral source, it shall reduce the amount of the award by such finding, minus an amount equal to the premiums paid by the plaintiff for such benefits for the two-year period immediately preceding the accrual of such action and minus an amount equal to the projected future cost to the plaintiff of maintaining such benefits.

CPLR 4545(a).

It is significant to note that the law in this area has changed dramatically. Under the common law, an injured person could recover the full amount of losses from a tortfeasor even if the injured person also recovered payments from employers or through his or her medical or other insurance policies. CPLR 4545, enacted in 1984, changed the law significantly, flipping the equation. Now reimbursed medical expenses or lost earnings, for example, can be an offset against damages awarded in a third-party tort action.

In Andino, the plaintiff, a retired police officer injured while on duty, brought this action and the jury awarded her a set amount for past and future lost earnings, past and future pain and suffering, future medical expenses, and future loss of pension.

Pursuant to CPLR 4545, defendant argued that the plaintiff’s accident disability retirement benefits (ADR) were a collateral source that the court should offset against the jury award for future lost earnings and pension benefits. Following a hearing, the trial court denied the motion, finding that the defendants had failed to show a connection between the projected ADR benefits and the lost earnings and pension. The Appellate Division modified the order, granting the motion to offset the award for future pension benefits (bringing these damages to zero), but otherwise affirming the denial of an offset for future lost earnings.

A majority of the Court of Appeals modified the Appellate Division order. It concluded that "ADR benefits operate sequentially as payment for future lost earnings and pension benefits." Andino, 2018 N.Y. Slip Op. 04273 at ∗2. The Court noted that police officers who suffer an accidental on- the-job injury causing them to stop working do not receive Workers’ Compensation Law benefits. Instead, they receive ADR benefits. While those benefits are lifetime payments, the Medical Board of the Police Pension Fund (Board) can require annual medical examinations. If the Board concludes that the recipient can engage in "a gainful occupation," the recipient can be placed on an eligible preferred list of candidates available to work. If the recipient then is employed or is offered City service, ADR benefits can be reduced. As a result, ADR benefits that are paid for a period prior to when the recipient would have been eligible for a service retirement can be reduced by amounts earned or earning capacity, over a statutory maximum of permissible income. This, the majority stated, means that these ADR benefits replace future lost earnings.

However, once the recipient reaches eligibility for a regular service pension, if not for the injury, ADR benefits are not reduced. In addition, the recipient can work at that point without having his

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. or her ADR benefits reduced (since they are now operating as a pension). Thus, the majority concluded that because "ADR replaces earnings and pension, it is a collateral source within the meaning of CPLR 4545 that a court must set off against both, representing the category of economic loss in which ADR is allocated sequentially." Id. at ∗3.

The majority noted that the ultimate goal of CPLR 4545 is to eliminate duplicative recovery by the plaintiff. It pointed to a letter from the New York City Mayor at the time of the enactment of CPLR 4545, contained in the Bill Jacket, evidencing that New York City believed that CPLR 4545 would lead to a full offset of ADR benefits against tort damage awards. Thus, the Court ruled that the projected ADR benefits should have been offset against the jury’s award of both categories of economic losses. "ADR benefits replace the income Andino would have earned if she did not have to retire early due to her work-related disability- causing injury. Then, once she reaches what would have been her in-service retirement age, the ADR benefits replace the pension she was entitled to at that time." Id.

Contrary to the plaintiff’s position, the majority stated that its prior decision in Oden v. Chemung County Indus. Dev. Agency, 87 N.Y.2d 81 (1995), did not mandate that there be a direct match between the collateral source and the jury damage award, requiring an exact dollar equivalence. All that needs to be established is that the collateral source replaces a category of loss in the jury award. In addition, Oden did not limit a collateral source’s offset to a single category of an award. Thus, while in Oden there was only one category of loss actually replaced by the benefits, here, the majority noted, the ADR benefits replaced two different categories of the award.

The dissent argued that the majority had repudiated its earlier "careful" decision in Oden by claiming that "a particular category of loss" can mean two or more categories of losses; this conclusion may leave plaintiffs undercompensated; "wages" or "salary" are not the same as "benefits" and ADR benefits, like pension benefits, are received only when you no longer provide services; and thus, ADR benefits "neatly correspond to the category of pension benefits, not to the category of wages."

The dissent stated that Oden required that a collateral source "may only correspond to a particular category of loss." Here, ADR benefits offset the plaintiff’s entire lost pension. Thus, any surplus should not be used to offset any other category. Finally, the dissent opined that the pension benefits plaintiff expects to recover are not duplicative of the future damages award, because, if the plaintiff had not been injured, she would have been allowed to earn income after retirement without a reduction of her pension benefits.

CPLR 4547 - Compromise and offers to compromise

CPLR 4547 - Emails constituting settlement communications

Gottbetter v. Crone Kline Rinde, LLP, 2018 NY Slip Op 04677 (1st Dep’t 2018) (“Contrary to defendants' argument, certain emails at issue constitute settlement communications, and detailed references to those negotiations are inadmissible and therefore must be stricken from the answer

(citations omitted). In addition, the first counterclaim must be dismissed because it is predicated upon allegations that Paul Gottbetter waived his rights under the agreement during the course of the settlement discussions. We note that, in any event, the inadmissible communications do not demonstrate such a waiver.”).

CPLR 4547 - No evidence that parties were engaged in settlement discussions when initial email was sent

Matter of Geo-Group Communications, Inc. v. Jaina Sys. Network, Inc., 144 A.D.3d 598, 42 N.Y.S.3d 118 (1st Dep’t 2016) (“Here, the arbitrator’s reliance on an email in which Jaina’s CEO acknowledged the debt did not violate New York’s public policy, or CPLR 4547, which provides that documents reflecting settlement negotiations are inadmissible. No evidence was presented that at the time the initial email was sent the parties were engaged in settling a dispute. Indeed, in his affidavit, Jaina’s CEO stated that he sent the email as a courtesy to petitioner to assist its CEO in connection with an external audit.”).

ARTICLE 50 - JUDGMENTS

CPLR 5001 - Interest to verdict, report or decision

CPLR 5001 - Prejudgment interest for award of unpaid legal fees

Davidoff Hutcher & Citron LLP v. Smirnov, 145 A.D.3d 488, 41 N.Y.S,3d 881 (1st Dep’t 2016) (“The addition of prejudgment interest to plaintiff’s award for unpaid legal fees under quantum meruit was mandatory (citations omitted). Moreover, where plaintiff was required to seek permission to withdraw, it was required to continue to zealously represent defendants until the court granted its motion to withdraw (Rules of Professional Conduct [22 NYCRR 1200.0] rule 1.16[d], [e]). Therefore, it was incorrect for the JHO to refuse to consider any value for plaintiff’s work from the time it moved by order to show cause to withdraw. This is particularly true where plaintiff sought, but was denied, an adjournment of the trial date, and the court took six months to grant the application.”).

CPLR 5001 - Award of prejudgment interest in matrimonial action is discretionary

O’Donnell v. O’Donnell, 153 A.D.3d 1357, 61 N.Y.S.3d 321 (2d Dep’t 2017) (“As to prejudgment interest, ‘[t]here is no automatic entitlement to prejudgment interest, under CPLR 5001, in matrimonial litigation’ (citation omitted). The general rule in matrimonial actions is that the determination of whether to award prejudgment interest is a discretionary determination with the trial court (citations omitted).”).

CPLR 5002 - Interest from verdict, report or decision to judgment

CPLR 5002 - Prejudgment interest does not run from date of stipulation of liability

Mahoney v. Brockbank, 142 A.D.3d 200, 204-205, 35 N.Y.S.3d 459 (2d Dep’t 2016) (The Second Department has ruled that where the issue of liability was resolved by stipulation, and the trial on damages was conducted almost 2 ½ years later, prejudgment interest ran from the date of the jury verdict on damages, not from the earlier date of the stipulation of liability. In doing so, the court stressed the difference between stipulations and verdicts, reports or decisions. “Stipulations are different. They are not adjudications made by a third party, but voluntary agreements, or contracts, by which the opposing parties themselves chart their own course in a way that makes sense for them (citations omitted). Here, for example, the stipulation addressed not only the issue of liability, but also the cause of action seeking punitive damages, and it provided for a cap on the plaintiff’s recovery. Whatever reasons the parties may have had for entering into the stipulation, they resolved those issues in a manner conceptually different from the methods that result in verdicts, reports, or decisions. Clearly, the Legislature did not expressly include stipulations in CPLR 5002. Had the Legislature wished to include stipulations, it easily could have done so, as it has in other statutes (citations omitted). And, since, as discussed above, stipulations are conceptually different from verdicts, reports, and decisions, the Legislature’s omission of stipulations from CPLR 5002 should be regarded as significant (citations omitted).”).

CPLR 5003-a - Prompt payment following settlement

CPLR 5003-a - Monies payable by settling defendants to third-party lienholder (not monies owed directly to settling plaintiff) do not constitute “sums due” to plaintiff within meaning of statute

Ronkese v. Tilcon N.Y., Inc., 153 A.D.3d 259, 59 N.Y.S.3d 605 (3d Dep’t 2017) (“CPLR 5003-a (a) provides, in relevant part, that ‘[w]hen an action to recover damages has been settled, any settling defendant . . . shall pay all sums due to any settling plaintiff within twenty-one days of tender, by the settling plaintiff to the settling defendant, of a duly executed release and a stipulation discontinuing action executed on behalf of the settling plaintiff.’ In the event that such payment is not promptly made within the prescribed time period, the statute authorizes ‘any unpaid plaintiff [to] enter judgment . . . against such settling defendant who has not paid’ for the full amount set forth in the release, together with interest, costs and disbursements (citation omitted). The dispute here centers on whether monies payable by a settling defendant to a third-party lienholder pursuant to a settlement agreement between a plaintiff and the defendant constitute a ‘sum[] due’ to the plaintiff within the meaning of CPLR 5003-a. We hold that it does not. ‘When presented with a question of statutory interpretation, our primary consideration is to ascertain and give effect to the intention of the Legislature’ (citations omitted). Our analysis is guided by the principle that ‘the text of a provision is “the clearest indicator of legislative intent and courts should construe unambiguous language to give effect to its plain meaning”‘ (citations omitted). Where, as here, the interpretation of a statute turns on the meaning of words not defined therein, ‘we construe words of ordinary import with their usual and commonly understood meaning, and in that connection

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. have regarded dictionary definitions as useful guideposts in determining the meaning of a word or phrase’ (citations omitted). CPLR 5003-a provides that a settling plaintiff is entitled to a judgment inclusive of interest, costs and disbursements on the amount set forth in the release in the event that a settling defendant fails to pay, within 21 days of tender of the release and stipulation discontinuing the action, ‘all sums due’ to the settling plaintiff. Our analysis thus hinges on the meaning of the word ‘sum,’ a term that is not defined in the CPLR. Black’s Law Dictionary defines ‘sum’ as a ‘quantity of money’ (Black’s Law Dictionary [10th ed 2014], sum). Likewise, the term ‘sum’ is commonly defined and understood as ‘an indefinite or specified amount of money’ (citations omitted). Notably, the Court of Appeals has held that, absent a controlling definition, the term ‘sums’ ‘logically acquires its widely used meaning of indefinite or specified amount[s] of money’ (citation omitted). Employing this commonly understood meaning of the word ‘sum,’ we conclude that CPLR 5003-a applies only to the nonpayment of settlement monies owed directly to a settling plaintiff pursuant to a settlement agreement. This construction is not only in accord with the plain language of the prompt payment mandate itself, but is also supported by the language of the statutory enforcement mechanism set forth in subdivision (e). CPLR 5003-a (e), the teeth that effectuate subdivision (a)’s prompt payment directive, authorizes an ‘unpaid plaintiff’ to enter judgment inclusive of interest, costs and disbursements against the nonpaying settling defendant (citation omitted). Simply put, plaintiff here is not ‘unpaid’ — all sums required to be paid to him pursuant to the parties’ settlement agreement (i.e., $3.25 million) were paid by defendant within the statutorily-prescribed 21-day time period. Had the Legislature intended to extend the reach of CPLR 5003-a to a settling defendant’s failure to promptly pay all valuable consideration due a settling plaintiff pursuant to the parties’ settlement agreement, it could have easily said so. It did not, and ‘a court cannot amend a statute by inserting words that are not there’ (citations omitted). Our interpretation of the statute finds further support in its legislative history. While the broadly stated purpose of CPLR 5003-a is to ‘encourage the prompt payment of claims which have been settled’ (citations omitted), the history surrounding the legislation confirms that it was enacted in response to a perceived problem of settling defendants ‘delay[ing] substantially in forwarding the settlement check to the plaintiff[,] thereby resulting in the plaintiff losing the interest on that money during the delay’ (citations omitted). The statute thus seeks to provide ‘settling plaintiffs with important protections in attempting to collect money damages,’ by relieving such plaintiffs of ‘the burden of being forced to continually pursue defendants for money which is often essential to their well-being’ and granting them rights ‘similar to those of plaintiffs who prevail in a litigation action in court when a money judgment is entered in their favor and bears interest from the date of its entry’ (citation omitted). Nothing in the legislative history of CPLR 5003-a suggests that the Legislature intended to avail a settling plaintiff of the benefits bestowed by the statute in the event that a settling defendant fails to promptly pay a third party pursuant to the parties’ settlement agreement. For these reasons, we find CPLR 5003-a to be inapplicable to the circumstances presented herein.”).

CPLR 5003-a - No interest where legislative approval was condition to proposed settlement

Azbel v. County of Nassau, 149 A.D.3d 1020, 53 N.Y.S.3d 656 (2d Dep’t 2017) (“Here, the Supreme Court properly denied the plaintiffs’ motion pursuant to CPLR 5003-a(e) to direct entry of a judgment awarding them interest on the amount of the parties’ settlement, plus costs and disbursements. Contrary to the plaintiffs’ contention, legislative approval was a condition of the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. proposed settlement entered into between the plaintiffs and the County. The Nassau County Administrative Code provides that the County Attorney shall not be empowered to settle any rights, claims, demands, or causes of action against the County unless authorized by the County Legislature (citation omitted). ‘[A] party that contracts with the State or one of its political subdivisions is chargeable with knowledge of the statutes which regulate its contracting powers and is bound by them’ (citations omitted). Inasmuch as the County Legislature did not approve the bond ordinance, a condition of the parties’ settlement was not met. Therefore, the matter was not finally settled and the 90-day period within which the County would have been required to make payment of the settlement amount was not triggered (citation omitted).”).

CPLR 5003-a - Maximum limit of MVAIC’s liability under the Insurance Law was $25,000, despite amount in release

Matter of Baker v. Motor Veh. Acc. Indem. Corp., 161 A.D.3d 1070 (2d Dep’t 2018) (“MVAIC alleged that it sought, on several occasions, to tender its $25,000 statutory liability limit on the underlying judgment, and forwarded to the petitioner’s counsel a release reflecting the proper statutory amount. It is uncontested that MVAIC refused to tender payment until the petitioner executed the release. However, the petitioner’s counsel demanded and forwarded a release reflecting the sum of $30,108.46. . . . The maximum limit of MVAIC’s liability under the Insurance Law is $25,000 (citation omitted). MVAIC’s contention that the petitioner is not entitled to interest because the delay in payment was caused by the plaintiff’s failure to execute a release in the proper amount is without merit. While MVAIC has the right to a release upon the settlement of a claim (citations omitted), MVAIC is not entitled to such a release when ordered to pay on a judgment. Here, the underlying action was not settled, but terminated with the entry of a judgment. No release is required to be tendered before the payment of a judgment, as it is not an agreement to pay, but an obligation to pay. While unconditional tender of a judgment amount stops the running of postjudgment interest (citations omitted), here, MVAIC conditioned the tender of the payment upon the execution of the release it provided. Thus, MVAIC’s contention that the petitioner caused the delay in payment of the underlying judgment is without merit. However, contrary to the petitioner’s contention, MVAIC’s liability for interest should have been calculated based on the sum of $25,000, and such interest should have been computed from the date of entry of the unpaid underlying judgment, that is, June 3, 2016, at 9% per annum (citations omitted).”).

CPLR 5011 - Definition and content of judgment

CPLR 5011 - Prior disclosure order which preceded plaintiff’s deposition, was not law of the case, where deposition introduced additional evidence and raised new issues

Milligan v. Bifulco, 153 A.D.3d 1624 (4th Dep’t 2017) (“We agree with defendants that, based on the broad and all-encompassing allegations of physical injury, the records sought from plaintiff’s health insurance carriers are ‘material and necessary’ ‘to the defense of this action (CPLR 3101 [a]), inasmuch as they may contain information reasonably calculated to lead to relevant evidence’ ‘ (citation omitted). We therefore modify the order by granting that part of the cross motion seeking to compel plaintiff to provide authorizations for the disclosure of those records. We conclude,

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. however, that disclosure should be made to Supreme Court ‘in camera so that irrelevant information is not disclosed to defendants’ (id.). We further agree with defendants that they established that plaintiff’s ‘special education, educational plans, IEP, [and] Section 504 records’ (special education records), as sought in demands 33 through 37, are relevant, or likely to lead to evidence that would be relevant to plaintiff’s claims of a loss of ‘economic capacity’ (citation omitted). For similar reasons, we conclude that defendants established that plaintiff’s records from ITT Tech may contain information ‘reasonably calculated to lead to relevant evidence’ ‘(citation omitted). We therefore further modify the order by granting those parts of the cross motion seeking to compel plaintiff to provide authorizations for the disclosure of those records. We note again that, because ‘the records may contain some privileged material, they should be reviewed in camera by the . . . [c]ourt[,] and privileged material, if any, should be redacted before giving [defendants] access to the records’ (citation omitted). Contrary to plaintiff’s contention, the court was not bound by the law of the case to follow an earlier order denying disclosure of the special education records. ‘The prior motion[s] preceded [plaintiff’s] deposition, which introduced additional evidence and raised further issues, thereby precluding application of the law of the case doctrine’ ‘(citations omitted). ‘In any event, the law of the case is not binding upon this Court’s review of the order” (citation omitted).”).

CPLR 5011 - Law of the case

Delgado v. City of New York, 144 A.D.3d 46, 38 N.Y.S.3d 129 (1st Dep’t 2016) (Where an issue is specifically decided on a summary judgment motion, that determination is the law of the case. Thus, the trial court and the parties are bound by such determination “absent a showing of subsequent evidence or change of law.”)

CPLR 5011 - Dismissal on statute of limitation grounds is considered to be on the merits for res judicata purposes

Webb v. Greater N.Y. Auto. Dealers Assn., Inc., 144 A.D.3d 1134, 42 N.Y.S.3d 324 (2d Dep’t 2016) (“Here, the plaintiff’s claims in the amended complaint in this action commenced in 2013 arose out of the same set of operative facts as claims she asserted in the 2012 action, which were dismissed on the ground that they were barred by the applicable statute of limitations (citation omitted), and could have been raised in that prior action. Contrary to the plaintiff’s contention, a dismissal on the ground of the statute of limitations is considered to be on the merits for res judicata purposes (citations omitted).”).

CPLR 5011 - Res judicata and collateral estoppel

Maki v. Bassett Healthcare, 141 A.D.3d 979, 981, 35 N.Y.S.3d 587, 590 (3d Dep’t 2016) (“The claims asserted in this action stem from the same series of transactions that gave rise to the 2010 action — i.e., the medical treatment provided to plaintiff following the 2008 accident. Indeed, the majority of the facts alleged in the two complaints are nearly identical, with the only difference being that the complaint commencing this action alleges continued pain and suffering, which nonetheless relate ‘in time, space, origin [and] motivation’ to those adjudicated in the 2010 action (citations omitted). Thus, inasmuch as all issues related to plaintiff’s claims sounding in simple

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. negligence and fraud were fully and finally decided in the 2010 action (citation omitted), they are barred by principles of res judicata and collateral estoppel (citation omitted). Plaintiff’s breach of contract claim, which alleged that defendants breached their contractual obligation to provide him with proper medical treatment, ‘could have been raised in the prior litigation’ and, consequently, is precluded by the doctrine of res judicata (citations omitted). Accordingly, Supreme Court did not err in dismissing the complaint.”).

CPLR 5011- Claim splitting rule

Strategic Point - The Fourth Department has ruled that the claim splitting rule “applies only when a plaintiff commences a new action (or interposes a new counterclaim) to expand his or her recovery from a prior action, not when the defendant in a prior action commences a new action against the former plaintiff to vindicate his or her own affirmative claims. In the latter instance, the defendant-turned-plaintiff did not assert any claim until the new action, and thus could not have impermissibly ‘split’ such a claim across multiple actions.” Thus, where a tenant “successfully defends an action commenced by his or her landlord, the tenant may commence a new plenary action against the landlord to recover the attorneys’ fees to which he or she may be entitled under Real Property Law § 234.” See Caracaus v. Conifer Cent. Sq. Assoc., 158 A.D.3d 63, 68 N.Y.S.3d 225 (4th Dep’t 2017) (“As a ‘narrow doctrine,’ the claim splitting rule is ‘most frequently invoked in landlord-tenant cases [involving] attorney’s fees’ (citations omitted). … Each of the foregoing cases are alike in one key respect - they enforced the claim splitting rule against a landlord-plaintiff who sought attorneys’ fees expended in prosecuting a prior action against the tenant-defendant. In other words, they each involve a landlord who successfully sued a tenant, and who later sued the same tenant for the attorneys’ fees incurred in the prior action. The landlords were commencing new actions (or interposing new counterclaims) to secure additional relief that could have been obtained in their prior actions, and that, each of the foregoing cases held, was barred by the claim splitting rule. … The claim splitting rule thus applies only when a plaintiff commences a new action (or interposes a new counterclaim) to expand his or her recovery from a prior action, not when the defendant in a prior action commences a new action against the former plaintiff to vindicate his or her own affirmative claims. In the latter instance, the defendant-turned-plaintiff did not assert any claim until the new action, and thus could not have impermissibly “split” such a claim across multiple actions (citation omitted). After all, a party must have asserted a claim in one action before he or she can be charged with splitting that claim in a subsequent action. … We recognize that the First Department held otherwise in O’Connell v. 1205-15 First Ave. Assoc., LLC (28 AD3d 233 [1st Dept 2006]), but we decline to follow that case. … Finally, we decline the landlord’s alternative invitation to treat the boilerplate, one-line requests for attorneys’ fees in the tenant’s answers in Village Court as the equivalent of a “claim” that triggered the claim splitting rule.”). The First Department has taken a contrary position. See O’Connell v. 1205-15 First Ave. Assoc., LLC , 28 A.D.3d 233, 234, 813 N.Y.S.2d 378, 379 (1st Dept 2006) (“the prohibition against the splitting of causes of action required plaintiff to seek attorneys' fees within the action in which they were incurred, not a subsequent action.“).

CPLR 5014 - Action upon judgment

CPLR 5014 - Renewal judgment

Jones Morrison, LLP v. Schloss, 155 A.D.3d 704, 65 N.Y.S.3d 52 (2d Dep’t 2017) (“The Supreme Court properly granted the plaintiff’s motion for summary judgment and entered a renewal judgment pursuant to CPLR 5014(1). The plaintiff established its prima facie entitlement to a renewal judgment as a matter of law by showing - (1) the existence of the original judgment; (2) that the defendant was the judgment debtor; (3) that the original judgment was docketed at least nine years prior to the commencement of this action; and (4) that the original judgment remains partially or completely unsatisfied (citations omitted). In opposition, the defendant failed to raise a triable issue of fact. Her arguments in opposition to the motion and in support of her cross motion were or could have been made in the prior actions, and are therefore barred by res judicata (citations omitted).”).

C.T. Holdings, Ltd. v. Schreiber Family Charitable Found., Inc., 154 A.D.3d 433, 61 N.Y.S.3d 532 (1st Dep’t 2017) (“Plaintiff judgment creditor timely commenced this action for a renewal judgment more than ten years after the docketing of the original judgment as a lien against appellant’s property (citation omitted). Plaintiff made a prima facie showing of its entitlement to a renewal judgment by demonstrating that defendants have not satisfied any part of the judgment (citation omitted). In opposition, appellant argued that plaintiff was not entitled to a renewal judgment because it had unreasonably delayed in enforcing the original judgment, while interest accumulated on the judgment and tax liens were imposed. On appeal, he argues that the equitable doctrine of laches applies since his circumstances have worsened during the ten years since the judgment was docketed. The ‘mere delay’ in enforcement of a judgment, without actual prejudice resulting from the delay, does not constitute laches (citations omitted). Appellant relies on facts outside the record which, in any event, do not constitute injury or prejudice resulting from plaintiff’s delay. The accumulation of postjudgment interest does not support a claim of laches, since plaintiff is entitled by statute to interest on the unpaid amount of the original judgment, which is valid for twenty years (citations omitted), regardless of whether the judgment is renewed.”).

CPLR 5015 - Relief from judgment or order

CPLR 5015 / 317 - Deliberate attempt to avoid service

John v. Arin Bainbridge Realty Corp., 147 A.D.3d 454, 46 N.Y.S.3d 589 (1st Dep’t 2017) (“Viewing the totality of the record, we find that the court providently exercised its discretion to deny vacatur of the default judgment under CPLR 317. Numerous anomalies in the record support the court’s inference that Arin sought to deliberately avoid service. For example, both the address given to the Secretary of State, 3161 Bainbridge Avenue, Bronx County (the Bainbridge address), and on the deed registration for the subject property, 320 Nassau Blvd, Garden City, were purportedly incorrect due to errors by Arin’s real estate counsel at the time Arin purchased the

Bainbridge property, yet Arin never sought an affidavit from counsel to explain the error, and Arin explains it only as a “mystery.” Moreover the summons and complaint, among many other notices, were sent to these addresses, which purportedly housed defendants Samcity and Arin’s real estate attorney’s office, and were not returned as undeliverable, but no affidavit was sought by Arin from anyone at either address to explain why these correspondences were not forwarded to Arin. Additionally, while Arin asserts that it used a P.O. box as its business address for a number of years, the P.O. box recited on the lease, while similar, is not the same as the P.O. box recited by plaintiff’s vice president in his affidavit. Arin’s secretary and shareholder, also averred that, since 2005, Arin has used the business address of 705 Rhinelander Avenue, Bronx County, however, in reply, its vice president avers that the address used is 705 Rylander Avenue. While poor draftsmanship or typographical errors might explain some of these anomalies, it does not explain why Arin submitted a lease to show that it was Samcity’s out-of-possession landlord, where the lease affirmatively refutes such an assertion, or the lack of any affirmative evidence of why those notices sent to the Bainbridge Ave. and Nassau Blvd. addresses were never forwarded to Arin. Under these circumstances, there were sufficient facts in the record to support the court’s inference of deliberate avoidance of process in this case, or at least, that Arin has not demonstrated that it did not receive notice in time to defend this action.”).

CPLR 5015(a)(1) - No reasonable excuse proffered to support vacating dismissal pursuant to 22 NYCRR 202.27

Chase Home Fin., LLC v. Desormeau, 152 A.D.3d 1033, 59 N.Y.S.3d 812 (3d Dep’t 2017) (“Even if plaintiff’s motion were timely, denial of the motion was proper as plaintiff failed to demonstrate a reasonable excuse for its failure to proceed. ‘A motion to vacate a dismissal pursuant to 22 NYCRR 202.27 must be supported by a reasonable excuse for the failure to proceed and a meritorious cause of action’ (citations omitted). Plaintiff’s counsel alleged that the delay in proceeding with the foreclosure action was due to the transfer of the mortgage loan to a new servicer and the need to comply with Administrative Order No. 548/10, which required that plaintiff review all documents relied upon in the foreclosure action. To demonstrate its compliance with the review, plaintiff relied upon the affidavit of Nathan Abeln, sworn to April 10, 2012. Inasmuch as the Abeln affidavit was executed 14 months prior to the order of dismissal, it cannot serve as a basis for a reasonable excuse. Plaintiff’s counsel further alleged that the delay was due to the need to comply with Administrative Order No. 431/11, which required that plaintiff’s counsel undertake a separate review of the loan documents and submit an affidavit of merit. The review conducted by plaintiff’s counsel was not completed until June 27, 2013, and plaintiff has offered no reason why its counsel could not complete review of the documents and proceed with the foreclosure action within the 14-month period following execution of the Abeln affidavit and prior to entry of the order dismissing the action. Therefore, even if we were to reach the merits of plaintiff’s motion, we would find no reasonable excuse for plaintiff’s failure to proceed, which would make it unnecessary to determine whether plaintiff had demonstrated a meritorious cause of action (citation omitted).”).

CPLR 5015(a)(1) – Trial court should not have vacated default - Conclusory and undetailed allegation of “law office confusion” does not constitute a reasonable excuse

OneWest Bank, FSB v. Singer, 153 A.D.3d 714, 59 N.Y.S.3d 480 (2d Dep’t 2017) (“Contrary to OneWest’s contention, it failed to provide a detailed and credible explanation of the default (citations omitted). Rather, counsel’s affirmation in support of the motion contained only the conclusory and undetailed allegation of ‘law office confusion’ after being substituted as counsel for OneWest, which does not constitute a reasonable excuse (citations omitted). No other evidence was submitted to corroborate the allegation. OneWest, therefore, failed to demonstrate a reasonable excuse for its default (citations omitted). Accordingly, the Supreme Court improvidently exercised its discretion in granting OneWest’s motion to vacate its default (citations omitted).”).

CPLR 5015(a)(1) – Default not vacated- Plaintiff’s motion to vacate default made 18 months after begin served with order and he made statement directly contrary to critical allegation in complaint

Marston v. Cole, 147 A.D.3d 678, 48 N.Y.S.3d 116 (1st Dep’t 2017) (“The court may grant a motion to vacate a default on grounds of excusable default and a showing of a meritorious defense, if the motion is made within one year after service of the order entered on default, with written notice of its entry (citations omitted). Marston did not move to vacate the order entered on default until February 18, 2014, nearly 18 months after he was served with the order and requisite notice. Furthermore, in support of his motion, Marston sought to demonstrate a meritorious defense by making a statement directly contrary to a critical allegation in his complaint. Accordingly, the motion court providently exercised its discretion not to vacate the default (citation omitted).”).

CPLR 5015(a)(1) - Failure to retain counsel prior to motion return date did not constitute reasonable excuse for default

135 Bowery LLC v. 10717 LLC, 145 A.D.3d 1225, 43 N.Y.S.3d 207 (3d Dep’t 2016) (“Defendant’s present assertion — that it was confused regarding or otherwise was unaware of the need to be represented by a licensed attorney — is belied by the record….Given defendant’s repeated failures to obtain counsel despite ample opportunity to do so, Supreme Court (Schick, J.) acted well within its discretion in concluding that defendant indeed was aware of the pending motion ‘but was derelict in timely acquiring counsel’ to oppose plaintiff’s motion for summary judgment. Indeed, ‘[a] corporate defendant’s failure to comply with CPLR 321 provides no basis for vacating a judgment entered against that defendant, since the rule is not intended to penalize an adverse party for the corporation’s improper appearance, but is rather to ensure that the corporation has a licensed representative who is answerable to the court and other parties for his or her own conduct in the matter’ (citations omitted). Accordingly, defendant’s failure to retain counsel prior to the return date of the motion did not constitute a reasonable excuse for its default.”).

CPLR 5015(a)(1) - Law office failure here not a reasonable excuse

Hill v. McCrae, 146 A.D.3d 1131, 45 N.Y.S.3d 273 (3d Dep’t 2017) (“In October 23, 2014, the parties appeared for a conference before Supreme Court to discuss outstanding discovery issues. At that conference, Supreme Court ordered that McCrae’s deposition be held on or before December 5, 2014 and scheduled a compliance conference for January 29, 2015. McCrae ultimately was not deposed and when neither McCrae nor Gonzalez or their counsel appeared for the January 2015 compliance conference, both plaintiff and O’Brien orally moved for default judgments pursuant to 22 NYCRR 202.27. … Here, the excuse of law office failure proffered by McCrae and Gonzalez was not a reasonable excuse for their nonappearance at the January 2015 compliance conference, particularly given that their counsel had a history of ignoring communications from the opposing parties and, at the time of the compliance conference, McCrae had yet to be deposed, despite Supreme Court’s order that such deposition be completed on or before December 5, 2014 (citations omitted). In the absence of a reasonable excuse, we need not reach the question of whether McCrae and Gonzalez demonstrated a meritorious defense or cross claim (citations omitted).”).

CPLR 5015(a) / 2005 - Vacating default- instance of excusable law office failure

Luderowski v. Sexton, 152 A.D.3d 918, 59 N.Y.S.3d 505 (3d Dep’t 2017) (“Here, defendants attribute their failure to timely serve an answer to law office failure, namely, defense counsel’s admittedly mistaken belief that one of his former associates had timely answered. This associate, who had been handling the matter, left the firm around the time that plaintiffs served defendants with the amended decision and order, thus commencing the period within which defendants had to answer. Defense counsel incorrectly assumed that this associate had filed and served the answer in the course of ‘wrap[ping] up’ his work for the firm and did not discover this error until after plaintiffs served him with notice of their intention to seek default judgments. Under the circumstances, we find that defendants’ default was attributable to an excusable instance of law office failure (citations omitted). The record reveals that, once the error was discovered, it was promptly cured (citations omitted). Defendants’ participation in significant motion practice before defaulting also indicates that they had no intention of abandoning their defense (citations omitted).”).

CPLR 5015(a)(1) - Good faith, although mistaken, belief that its legal interests were being represented is reasonable excuse

Gage v. Village of Catskill, 144 A.D.3d 1365, 41 N.Y.S.3d 328 (3d Dep’t 2016) (“Contrary to plaintiff’s claim, this is not a case in which the excuse offered for the default is the insurer’s delay in responding or interposing a defense on behalf of its insured (citations omitted). Rather, defendant’s default was based upon its good faith, albeit mistaken, belief that its legal interests were being represented by SIC in the pending action, a belief that stemmed from SIC’s involvement in the case from the time that the notice of claim was served and its appointment of counsel to represent defendant in the litigation that followed (citations omitted). Under these circumstances, Supreme Court providently exercised its discretion in finding that defendant demonstrated a reasonable excuse for its failure to appear in the action. Furthermore, defendant

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. put forth a meritorious defense to the action, namely, that the piece of metal over which plaintiff tripped was a broken sign that had been erected by the state to control pedestrian traffic along a state highway that is not maintained by defendant. In view of the foregoing, we find no reason to disturb Supreme Court’s vacatur of the default judgment.”).

CPLR 5015(a)(1) - Law office failure to regularly check email resulting in respondents being unaware of court order that resulted in default

Matter of Rivera v. New York City Dept. of Sanitation, 142 A.D.3d 463, 36 N.Y.S.3d 464 (1st Dep’t 2016) (“On the merits, respondents cite ‘law office failure’ as a reason for the default. Under certain circumstances, law office failure may provide a reasonable excuse for a default (citation omitted). At oral argument, respondents essentially conceded that, in this e-filed case, their office failed to regularly check its email and, as a result, was unaware of the motion court’s order that gave rise to the default. Respondents’ excuse was sufficiently particularized and there is no evidence of wilful or contumacious conduct on their part (citation omitted.”).

CPLR 5015(a)(1) - Defendant establishes reasonable excuse for Secretary of State not having updated address on file

Li Fen Li v. Cannon Co., Inc., 155 A.D.3d 858, 63 N.Y.S.3d 702 (2d Dep’t 2017) (“‘A defendant seeking to vacate a default pursuant to CPLR 5015(a)(1) must demonstrate both a reasonable excuse for the default and a potentially meritorious defense’ (citation omitted). While a corporate defendant’s failure to update its address for service that is kept on file with the Secretary of State generally does not constitute a reasonable excuse (citations omitted), a court is not precluded from finding a reasonable excuse in such a case where the circumstances warrant it (citations omitted). Here, Ekistics established a reasonable excuse by submitting evidence that it attempted to update its address on file with the Secretary of State at the time it moved to a new location, that it was unaware that its address had not been updated in the Secretary of State’s files, that it did not acquire actual notice of this action until long after the order authorizing entry of a default judgment against it had been issued, and that the plaintiff knew its actual business address but sent no notice of the action to that address (citations omitted). Moreover, Ekistics demonstrated a potentially meritorious defense to the action by submitting evidence that it had no control over, and no responsibility for, a power cable on the sidewalk over which the plaintiff allegedly tripped. Accordingly, the motion by Ekistics pursuant to CPLR 5015(a)(1) to vacate its default was properly granted.”).

CPLR 5015(a)(1) - Vacating Default-no reasonable excuse proffered

Lee v. Latendorf, 2018 NY Slip Op 04709 (2d Dep’t 2018) (“Here, the Supreme Court providently exercised its discretion in determining that the plaintiffs did not offer a reasonable excuse for their default. The excuse proffered by the plaintiffs' former attorney, that he failed to appear at the May 19, 2015, conference due to a malfunctioning GPS system and that he ‘got lost,’ was unreasonable under the circumstances, as it was not a detailed and credible explanation for the claimed law office failure. Moreover, the plaintiffs failed to set forth any excuse, let alone a reasonable one, for

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. their former attorney's failure to appear at the compliance conference scheduled for February 18, 2015, or why he arrived late for the adjourned conference on February 26, 2015.”).

Matter of Matthew C. v. Robin B., 2018 NY Slip Op 04078 (1st Dep’t 2018) (“Respondent failed to demonstrate a reasonable excuse for her default (citations omitted). She presented no evidence to substantiate her alleged lack of funds to travel to New York City to appear at the hearing (citations omitted). She failed to timely contact the court to inform it of her unavailability, and she failed to make herself available by telephone at the time the case was called. Instead, she went about her day, as scheduled, including attending a physical therapy appointment, and waited until after the case was called and adjudicated in her absence to make contact with the court (citation omitted).”).

Hertz Vehicles, LLC v. Gejo, LLC, 161 A.D.3d 549 (1st Dep’t 2018) (“‘A defendant seeking to vacate a default under [CPLR 5015(a)] must demonstrate a reasonable excuse for its delay in appearing and answering the complaint and a meritorious defense to the action’ (citation omitted). Here, while MPS’s initial excuse of law office failure for failing to timely answer may be reasonable, MPS was dilatory in asserting its rights (citations omitted). MPS retained new counsel about eight months prior to entry of the default judgment, yet counsel waited until the eve of the expiration of the one-year time limit before moving to vacate. MPS provided no excuse for why its new counsel failed to address the pending default judgment motion during the time period before a decision was rendered, or why it waited almost another year to move to vacate the default judgment.”).

Golf Glen Plaza Niles, Il. L.P. v. AMCOID USA, LLC, 160 A.D.3d 1375 (4th Dep’t 2018) (“Contrary to defendant's further contention, the court properly denied as untimely the request in his motion to vacate the default judgment and allow him to proceed on the merits on the ground that he had a reasonable excuse for the default and has a meritorious defense (citation omitted). Moreover, even if defendant had timely moved to vacate the default on that ground, we conclude that defendant's assertion that he erroneously assumed that his wife's cousin and her attorney would respond to the complaint on his behalf does not constitute a reasonable excuse (citations omitted). Further, defendant's unsubstantiated claim that the signatures on the assignments were forged fails to establish that he has a meritorious defense (citations omitted).”).

Ki Tae Kim v. Bishop, 147 A.D.3d 1447, 46 N.Y.S.3d 457 (2d Dep’t 2017) (“Here, the Supreme Court providently exercised its discretion in determining that the appellant failed to present a reasonable excuse for her defaults. The appellant’s counsel’s affirmation in support of the motion contained conclusory and unsubstantiated allegations of law office failure after an attorney left the firm. Counsel’s neglect in timely ascertaining whether opposition had been filed did not constitute a reasonable excuse (citations omitted). Nor did the appellant provide a reasonable excuse for the three-month delay in moving to vacate her defaults (citations omitted).”).

Onishenko v. Ntansah, 145 A.D.3d 910, 43 N.Y.S.3d 504 (2d Dep’t 2016) (“The plaintiff’s attorney’s proffered excuse failed to adequately explain the default in this case. The alleged error in not filing a change of attorney form for more than 2½ years after counsel had been substituted and the failure to have the date of oral argument appear on counsel’s calendar cannot account for

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the plaintiff’s inaction for 7 months when counsel was aware of the pending motion (citation omitted). Accordingly, the plaintiff failed to establish a reasonable excuse for her default. Since the plaintiff failed to establish a reasonable excuse for her default, it is unnecessary to determine whether she established a potentially meritorious opposition to the defendants’ motion (citations omitted).”).

CPLR 5015(a)(1) - Vacating Default-reasonable excuse provided

Benchmark Farm, Inc. v. Red Horse Farm, LLC, 2018 NY Slip Op 04522 (2d Dep’t 2018) (“Here, the defendant submitted the sworn affidavit of its principal, who stated that the defendant did not learn of the action or the judgment until August 2016, and that approximately one month thereafter it moved to vacate the judgment. The affidavit indicated that in 2003 the defendant's principal had moved his residence from the address on file with the Secretary of State and that neither the defendant nor its principal had received mail at that address since 2004. The affidavit also provided that the defendant's address had not been updated with the Secretary of State. There is no evidence in the record that the defendant or its agent received actual notice of the summons, which was delivered to the Secretary of State, in time to defend this action (citations omitted). Although the defendant did not explain why it failed to update its address with the Secretary of State, ‘there is no necessity for a defendant moving pursuant to CPLR 317 to show a reasonable excuse for its delay’ (citations omitted), and there is no basis in the record to conclude that the defendant deliberately attempted to avoid service, especially since the plaintiff had knowledge of the defendant's actual business address and had written to the defendant at that address regarding the dispute that gave rise to the plaintiff's complaint (citations omitted).”).

Inwald Enters., LLC v. Aloha Energy, 153 A.D.3d 1008, 61 N.Y.S.3d 358 (3d Dep’t 2017) (“Here, even applying the arguably more exacting standard set forth in CPLR 5015 (a) (1), we do not find that Supreme Court abused its discretion in granting Inwald’s motion. While there indeed may be instances where counsel’s inaction or dilatory conduct may be imputed to the client (citations omitted), a review of Robin Inwald’s affidavit — together with the supporting documentation annexed thereto — reveals that she never intended to abandon either the pursuit of action No. 1 or the defense of action No. 2 (citation omitted) but, rather, reasonably believed that Humphrey was actively pursuing and properly defending Inwald’s interests in the context thereof (citation omitted). Although Robin Inwald acknowledged that Humphrey often was slow to respond to her inquiries, she averred that he assured her that discovery was progressing and that he would keep her apprised of further court conferences and developments. Indeed, Robin Inwald asked Humphrey that she be included in what she believed would be a telephone conference with Supreme Court in September 2015 and, when Humphrey failed to respond to her request, she went down to the courthouse and inquired as to the status of the cases — only to learn that the complaint had been dismissed in action No. 1 and that a default judgment had been entered in action No. 2. As noted previously, new counsel then was retained and the instant motion to vacate was brought. Under these circumstances, we cannot say that Supreme Court abused its discretion in declining to penalize Inwald for Humphrey’s omissions and, further, in finding that Inwald demonstrated a reasonable excuse for the default.”).

CPLR 5015(a)(2) - Evidence which is matter of public record is generally not deemed new evidence

Inman v. Scarsdale Shopping Ctr. Assoc., LLC, 149 A.D.3d 1051, 50 N.Y.S.3d 884 (2d Dep’t 2017) (“The Supreme Court providently exercised its discretion in denying that branch of the defendants’ motion which was pursuant to CPLR 5015(a)(2) to vacate a judgment dated November 25, 2014, in favor of the plaintiffs and against them. While the defendants submitted evidence in support of their motion that they claimed was newly discovered, ‘[e]vidence which is a matter of public record is generally not deemed new evidence which could not have been discovered with due diligence before trial’ (citations omitted). In any event, the defendants also failed to demonstrate that the newly discovered evidence ‘would probably have produced a different result’ (citations omitted).”).

CPLR 5019 - Validity and correction of judgment or order

CPLR 5019 - Modifying a judgment to conform with the court’s decision after trial with respect to equitable distribution

Shkreli v. Shkreli, 142 A.D.3d 546, 36 N.Y.S.3d 208 (2d Dep’t 2016) (“The Supreme Court providently exercised its discretion in directing that the marital residence be sold (citation omitted). However, the judgment of divorce should be modified to conform with the court’s decision after trial regarding the equitable distribution of the remaining sale proceeds of the marital residence, with 60% awarded to the plaintiff and 40% to the defendant (citations omitted).”).

CPLR 5019 - Substituting, nunc pro tunc, the newly signed affidavit of merit in place of the affidavit of merit that had been attached to its application for an order of reference

U.S. Bank, N.A. v. Steele, 142 A.D.3d 1161, 39 N.Y.S.3d 178 (2d Dep’t 2016) (“The Supreme Court providently exercised its discretion in granting those branches of the plaintiff’s motion which were to substitute, nunc pro tunc, the newly signed affidavit of merit in place of the affidavit of merit that had been attached to its application for an order of reference, and to validate the order of reference. CPLR 2001 ‘permits a court, at any stage of an action, to disregard a party’s mistake, omission, defect, or irregularity if a substantial right of a party is not prejudiced’ (citations omitted). In addition, pursuant to CPLR 5019(a), a court has ‘discretion to correct an order or judgment which contains a mistake, defect, or irregularity not affecting a substantial right of a party’ (citation omitted). Here no substantial right of the defendant has been affected by the court’s substitution of the new affidavit of merit ((citations omitted).”).

CPLR 5019 - Correcting name in caption

Bessa v. Anflo Indus., Inc., 148 A.D.3d 974, 51 N.Y.S.3d 102 (2d Dep’t 2017) (to permit amendment of caption and pleadings to reflect plaintiff’s correct legal name; “Although dismissal of the complaint was not warranted, the Supreme Court nevertheless should have taken steps to ensure that the caption and the pleadings in this action were amended to reflect the plaintiff’s

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. correct name. ‘[W]here the right party plaintiff is in court but under a defective name or title as party plaintiff, . . . an amendment correcting the title is permissible’ (citations omitted). Indeed, ‘CPLR 2001 permits a court, at any stage of an action, to disregard a party’s mistake, omission, defect, or irregularity if a substantial right of a party is not prejudiced’ (citation omitted), and CPLR 5019(a) gives trial and appellate courts the discretion to cure mistakes, defects, and irregularities that do not affect substantial rights of parties (citations omitted). Inasmuch as the appellants failed to demonstrate that they would suffer any prejudice if the plaintiff’s name is corrected, the court should have directed the amendment of the caption and the pleadings to reflect the plaintiff’s correct legal name (citations omitted).”).

CPLR 5019 - Plaintiff’s request that the action be allowed to continue against the individual who, it appears, assumed movant’s identity, i.e., the ‘Colin M. Smith’ who represented himself to be an attorney with law offices at 721 Fifth Avenue, New York, NY 10022, and purported to enter into the subject contract, should have been granted

Dobbs v. Smith, 151 A.D.3d 418, 52 N.Y.S.3d 860 (1st Dep’t 2017) (“Movant’s motion for summary judgment dismissing the breach of contract claims against him was correctly granted upon movant’s unrebutted showing that he was not the ‘Colin M. Smith’ with whom plaintiff had contracted. However, since movant sought dismissal only as against himself, plaintiff’s request that the action be allowed to continue against the individual who, it appears, assumed movant’s identity, i.e., the ‘Colin M. Smith’ who represented himself to be an attorney with law offices at 721 Fifth Avenue, New York, NY 10022, and purported to enter into the subject contract, should have been granted (citation omitted).”).

ARTICLE 51 - ENFORCEMENT OF JUDGMENTS AND ORDERS GENERALLY

CPLR 5104 - Enforcement of judgment or order by contempt

CPLR 5104 - Contempt of court for failure to comply with the terms of a so-ordered stipulation of settlement

Matter of William Madenberg Irrevocable Trust, 143 A.D.3d 904, 39 N.Y.S.3d 798 (2d Dep’t 2016) (“The Surrogate’s Court properly granted that branch of the petitioners’ motion which was pursuant to CPLR 5104 to hold the appellant in contempt of court for failure to comply with the terms of a so-ordered stipulation of settlement. The petitioners demonstrated, by clear and convincing evidence, that the appellant disobeyed unequivocal mandates set forth in the so-ordered stipulation of settlement, of which he had knowledge, and that they were prejudiced by this conduct (citations omitted). In opposition, the appellant failed to refute this showing, or to offer evidence of a defense, such as inability to comply with the order (citations omitted).”).

ARTICLE 52 - ENFORCEMET OF MONEY JUDGMENTS

CPLR 5225 - Payment or delivery of property of judgment debtor

CPLR 5225 - Membership interest in LLC is property for CPLR Article 52 purposes

Matter of Sirotkin v. Jordan, LLC, 141 A.D.3d 670, 35 N.Y.S.3d 443 (2d Dep’t 2016) (“A membership interest in a limited liability company is ‘clearly assignable and transferrable,’ and, therefore, such interest is ‘property’ for purposes of CPLR article 52 (citations omitted). Indeed, Limited Liability Company Law § 603 expressly acknowledges that ‘[e]xcept as provided in the operating agreement . . . a membership interest is assignable in whole or in part’ (Limited Liability Company Law § 603[a][1]). In considering the remedies available to a judgment creditor such as the petitioner under CPLR article 52, the Supreme Court was not limited to considering the petitioner’s request for an order assigning to him Spitzer’s membership interest in the LLC. CPLR 5240, which was relied upon by the Supreme Court, provides, in pertinent part, that a court ‘may at any time, on its own initiative or the motion of any interested person, and upon such notice as it may require, make an order denying, limiting, conditioning, regulating, extending or modifying the use of any enforcement procedure’ (citations omitted). This section grants the Supreme Court broad discretionary power to alter the use of procedures set forth in CPLR article 52 (citation omitted). Limited Liability Company Law § 607 expressly provides that, on an application by a judgment creditor of a member of an LLC, ‘the court may charge’ the debtor’s membership interest ‘with payment of the unsatisfied amount of the judgment with interest,’ and ‘[t]o the extent so charged, the judgment creditor has only the rights of an assignee of the membership interest.’ Thus, CPLR 5240 and Limited Liability Company Law § 607 give the court discretion, in an appropriate case, to issue a charging order instead of, inter alia, an order assigning or turning over the judgment debtor’s membership interest in an LLC to the judgment creditor (citation omitted).”).

CPLR 5241 - Income execution for support enforcement

CPLR 5241 - Income execution for support enforcement-“[T]he plaintiff is not entitled to have the income execution limited to only 10% of his disposable earnings. However, on this record, the plaintiff demonstrated that limiting the income execution to 40% of his disposable earnings is warranted.”

Fishler v. Fishler, 154 A.D.3d 917, 63 N.Y.S.3d 445 (2d Dep’t 2017) (“CPLR 5241, which governs income execution for support enforcement, ‘inaugurated a broad expansion of the benefits available to a creditor’ (citations omitted). While an ordinary income execution is limited to a maximum of 10% of income (citation omitted), the maximum percentage available for garnishment pursuant to CPLR 5241 is between 50% and 65%, depending upon the debtor’s other support obligations and the extent and duration of the support arrears (citations omitted). Here, the maximum percentage available for garnishment is 65% of the plaintiff’s disposable earnings (citation omitted). CPLR 5231 defines ‘disposable earnings’ as ‘that part of the earnings of any

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. individual remaining after the deduction from those earnings of any amounts required by law to be withheld,’ such as taxes and social security. … Under all the circumstances present here, it cannot be said that, at the time of the instant motion, the 65% income execution struck ‘a fair balance between the needs of a creditor holding a valid money judgment and the needs of a debtor managing competing financial obligations’ (citation omitted). To the contrary, the record reflects that the 65% income execution created a tremendous disparity between the plaintiff’s expenses and his actual income after garnishment and deductions, and that the defendant did not have any particular need for the maximum garnishment percentage. The defendant’s remaining contentions are without merit. Accordingly, the Supreme Court should have exercised its broad discretion to modify and limit the income execution to prevent unreasonable disadvantage and undue prejudice to the plaintiff (citations omitted). In light of his substantial arrears, we find that the plaintiff is not entitled to have the income execution limited to only 10% of his disposable earnings. However, on this record, the plaintiff demonstrated that limiting the income execution to 40% of his disposable earnings is warranted.”).

CPLR 5241 - Special income execution provision is for support obligations only

Granat v. Granat, 152 A.D.3d 572, 58 N.Y.S.3d 531 (2d Dep’t 2017) (Motion sought order pursuant to CPLR 5241 to direct income execution against plaintiff’s social security benefits. “CPLR 5241 was enacted to aid in the enforcement of support obligations (citation omitted). While this statute inaugurated a broad expansion of the benefits available to a creditor (citation omitted), the special income execution provision of CPLR 5241 is for support obligations only (citations omitted). Under the particular circumstances of this case, the defendant failed to establish entitlement to the issuance of an income execution. Accordingly, the Supreme Court properly denied the defendant’s motion.”).

ARTICLE 53 - RECOGNITION OF FOREIGN COUNTRY MONEY JUDGMENTS

CPLR 5302 - Applicability

CPLR 5302 - English award of costs does not constitute a penalty

Hill Dickinson LLP v. Il Sole Ltd., 149 A.D.3d 471, 49 N.Y.S.3d 888 (1st Dep’t 2017) (“Were we to review Hirtenstein’s challenge to the recognition of the British judgment, we would find it unavailing. It is undisputed that the foreign money judgment is ‘final, conclusive and enforceable’ (citation omitted) and the grounds for non-recognition are inapplicable (citation omitted). The English court’s award of costs to compensate Hill Dickinson for having to defend an action by defendants does not constitute a penalty (citation omitted).”).

CPLR 5304 - Grounds for non-recognition

CPLR 5304 - Grounds set forth in CPLR 5304 for non-recognition are inapplicable

Marshall v. Fleming, 161 A.D.3d 496 (1st Dep’t 2018) (“The motion court properly recognized the Australian judgment, which was ‘final, conclusive and enforceable where rendered’ (citation omitted). The grounds set forth in CPLR 5304 for non-recognition are inapplicable. Contrary to defendants’ contention, the Australian judgment is not repugnant to New York’s statute of limitations (citation omitted). The judgment did not arise from a time-barred claim; it represents the costs associated with defendants’ unsuccessful motion to dismiss the Australian action on the ground of forum non conveniens. Recognition here would not be ‘the approval of a transaction which is inherently vicious, wicked or immoral, and shocking to the prevailing moral sense’ (citation omitted).”).

ARTICLE 55 - APPEALS GENERALLY

CPLR 5501 - Scope of review

CPLR 5501 - Remittur

Matter of New York City Asbestos Litig., 143 A.D.3d 485, 39 N.Y.S.3d 130 (1st Dep’t 2016) (For 12 months of pain and suffering, after jury trial “awarding plaintiff damages against defendant Crane Co., upon plaintiff’s stipulation to reduce the award for past pain and suffering from $10 million to $6 million, unanimously modified, on the facts, to vacate the award for past pain and suffering, and ordering a new trial as to such damages, unless plaintiff stipulates, within 30 days of service of a copy of this order with notice of entry, to a reduced award for past pain and suffering of $3,000,000, and to entry of an amended judgment in accordance therewith, and otherwise affirmed, without costs.”); Matter of New York City Asbestos Litig., 143 A.D.3d 483, 39 N.Y.S.3d 411 (1st Dep’t 2016) (Appellate Division vacates $5 million stipulated award for future pain and suffering and orders new trial as to such damages unless plaintiff stipulates to $4.5 million award for 1.5 years of pain and suffering); Peraica v A.O. Smith Water Prods. Co., 143 A.D.3d 448, 39 N.Y.S.3d 392 (1st Dep’t 2016) (Appellate Division vacates $9.9 million award for past pain and suffering and orders new trial on damages unless plaintiff stipulates to $4.25 million award for 17 months of pain and suffering).

CPLR 5501 - Party Finality Doctrine

Hain v. Jamison, 28 N.Y.3d 524, footnote 2, 46 N.Y.S.3d 502, 68 N.E.3d 1233 (2016) (Although the Appellate Division order granting summary judgment to co-defendant Farm was “non-final” because the claims asserted by plaintiff against the Jamison co-defendants remained, the Court nevertheless treated the order as final as to Farm under party finality doctrine (that is, an order that

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. finally determines rights of one of multiple parties is considered final, even though unresolved issues not impacting that party remain.)). See David L. Ferstendig, Court Holds Defendant Failed to Meet its Burden on Summary Judgment Motion on Proximate Cause Issue, 674 N.Y.S.L.D. 3 (2017).

CPLR 5501(c) - The amounts awarded for plaintiff’s injuries deviate materially from what is reasonable compensation

Nawrocki v. Huron St. Dev. LLC, 161 A.D.3d 697, 74 N.Y.S.3d 494 (1st Dep’t 2018) (“Order, Supreme Court, Bronx County (Ruben Franco, J.), entered January 14, 2016, which, after an inquest, inter alia, awarded plaintiff $25,000 for past pain and suffering and $25,000 for future pain and suffering, unanimously modified, on the facts, to increase the awards to $250,000 for past pain and suffering, and $250,000 for future pain and suffering, and otherwise affirmed, without costs. Plaintiff, a 28-year-old plumber, fell from a ladder while working, and sustained two fractures in his jaw and an impacted tooth, requiring internal fixation surgery and plastic surgery. He could not eat without using a straw for eight weeks, then not without pain for six to eight months, and was left with scarring. Under these circumstances, the amounts awarded for plaintiff’s injuries deviate materially from what is reasonable compensation, and we modify to the extent indicated (citations omitted).”).

CPLR 5511 - Permissible appellant and respondent

CPLR 5511 - Party not aggrieved

Matter of Olney v. Town of Barrington, 2018 NY Slip Op 04454 (4th Dep’t 2018) (“Thus, we conclude that defendants are not aggrieved by the judgment, and their appeals must be dismissed (citations omitted). The fact that the judgment ‘may remotely or contingently affect interests which [defendants] represent[] does not give [them] a right to appeal’ (citation omitted). Likewise, the fact that the judgment ‘may contain language or reasoning which [defendants] deem adverse to their interests does not furnish them with a basis . . . to take an appeal’ (citations omitted).”).

Hernstat v. Anthony's Windows on the Lake, Inc., 74 N.Y.S.3d 881 (2d Dep’t 2018) (“The appeal must be dismissed, as the plaintiff is not aggrieved by the order appealed from, which denied the defendants' motion for summary judgment and imposed the lesser sanction of an adverse inference charge in accordance with the plaintiff's request (citations omitted).”).

CPLR 5511 - Since plaintiff did not appeal, the Court could not reinstate the complaint

Hain v. Jamison, 28 N.Y.3d 524, footnote 3 (2016) (Following the Appellate Division decision granting co-defendant Farm’s summary judgment motion, only the Jamison co-defendants, but not the plaintiff, moved for leave to appeal. As a result, although Court of Appeals reversed, it could not reinstate the complaint against Farm.). See David L. Ferstendig, Court Holds Defendant Failed to Meet its Burden on Summary Judgment Motion on Proximate Cause Issue, 674 N.Y.S.L.D. 3 (2017).

CPLR 5511 - Aggrievement – language deemed adverse to parties’ interest does not furnish basis for standing to take appeal

NYCTL 2011-A Trust v. Master Sheet Co., Inc., 150 A.D.3d 755, 54 N.Y.S.3d 422 (2d Dep’t 2017) (“Inasmuch as the Supreme Court granted the plaintiffs’ motion, they are not aggrieved by the order appealed from (citation omitted). On appeal, their sole contention relates to handwritten language on the order, which is not part of any decretal paragraph. The first part of the notation states that ‘[t]his order of Reference does not validate the lien, it just computes the amount.’ However, ‘findings of fact and conclusions of law which do not grant or deny relief are not independently appealable’ (citations omitted). ‘Merely because the order appealed from contains language or reasoning that a party deems adverse to its interests does not furnish a basis for standing to take an appeal’’ (citations omitted). The second part of the notation challenged by the plaintiffs states that the order is ‘without prejudice to a dispute with the NYC Health Department’ as to the amount of the lien. The plaintiffs are not aggrieved by this language, since ‘any dispute as to the amount of the lien may be resolved after a reference pursuant to RPAPL 1321’ (citation omitted).”).

CPLR 5511 - Aggrievement -the order and judgment appealed from does not impact any existing right of appellant

Hermitage Ins. Co. v. 186-190 Lenox Rd., LLC, 142 A.D.3d 422, 36 N.Y.S.3d 634 (1st Dep’t 2016) (“Smith lacks standing to appeal from an order granting a default judgment against Lenox, which failed to appear or answer the complaint and failed to oppose the motion for a default judgment (citation omitted). Although Smith, as a named party, could have opposed Hermitage’s position on coverage (citation omitted), she elected to seek dismissal on procedural grounds. Thus, having been granted the relief she sought on her own behalf, and having failed to offer any substantive opposition to Heritage’s claim of untimely notice or to oppose Heritage’s request for a default judgment against Lenox, Smith was not aggrieved by that portion of the order that declared that Heritage was not obligated to defend and indemnify Lenox in the underlying action (citation omitted). Furthermore, because this action was dismissed against Smith as abandoned, whether or not the declaration will have a preclusive effect will only become an issue if Smith obtains a judgment against Lenox that remains unsatisfied and then seeks to enforce it in a direct action against Hermitage under Insurance Law § 3420(a)(2). Accordingly, as the order and judgment appealed from does not impact any existing right of Smith, she is not an “aggrieved party” under CPLR 5511, because any effect the court’s declaration may have on her possible future interests is too remote and contingent to give her standing in this appeal.”).

CPLR 5511 - Grandmother not aggrieved by order granting relief to father against mother

Matter of Kone v. Martin, 146 A.D.3d 781, 43 N.Y.S.3d 919 (2d Dep’t 2017) (“‘A person is aggrieved within the meaning of CPLR 5511 when he or she asks for relief but that relief is denied in whole or in part, “or, when someone asks for relief against him or her, which the person opposes, and the relief is granted in whole or in part”‘ (citations omitted). The order appealed from granted

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. relief to the father against the mother. Since the grandmother is not aggrieved by the order appealed from, her appeal must be dismissed (citations omitted).”).

CPLR 5511 - Appeals dismissed because parties are not aggrieved

Marion v. City of New York, 153 A.D.3d 691, 60 N.Y.S.3d 289 (2d Dep’t 2017) (“The plaintiffs and Smith are not aggrieved by that portion of the order which granted that branch of MTA’s motion which was for summary judgment dismissing the third-party complaint (citations omitted). The plaintiffs and Smith are also not aggrieved by the portion of the order which, in effect, denied as ‘moot’ those branches of MTA’s motion which were for summary judgment dismissing the amended verified complaint and all cross claims insofar as asserted against it (citation omitted).”).

CPLR 5513 - Time to take appeal

CPLR 5513 - Appeal time runs from service of order with written notice of entry. Despite premature notice of appeal, court exercises discretion to treat it as valid.

Paternosh v. Wood, 151 A.D.3d 1733, 56 N.Y.S.3d 747 (4th Dep’t 2017) (“As an initial matter, we reject defendant’s contention that plaintiffs’ appeal should be dismissed as untimely filed. Even where, as here, the appellant is the party that prepares and files the judgment or order appealed from, the 30-day period in which to file a notice of appeal is triggered only by service of a copy of the judgment or order, together with ‘written notice of its entry,’ on the opposing party (citations omitted). The record here does not contain a notice of entry, and it therefore does not establish that the 30-day period ever began to run (citations omitted). Although plaintiffs’ notice of appeal thus appears to be premature, rather than late as contended by defendant, we exercise our discretion to treat it as valid (citation omitted).”).

CPLR 5513 - Notice of appeal untimely- 30 days runs from original order, not supplemental order, which contained no material change

Matter of Twin Bay Vil., Inc., 2018 NY Slip Op 04405 (3d Dep’t 2018) (“Initially, we find respondents' appeal from the May 2016 supplemental order to be untimely. In conjunction with their original application to judicially dissolve the corporation, petitioners requested that Supreme Court (Muller, J.) nullify a $14,000 mortgage between respondent Tamara Chomiak and the corporation. In its March 2016 order, the court declared the purported mortgage null and void; however, after appointment by the receiver, it was determined that the Clerk's office needed more specific language describing the subject mortgage in order to nullify it. Accordingly, the court issued the May 2016 supplemental order to modify its March 2016 order, specifying the recording date and book number of the subject mortgage. As there is no material change in the supplemental order, the notice of appeal — to be timely — must have been filed within 30 days from March 23, 2016, which is the date of service of a copy of the March 2016 order with notice of entry (citation omitted). Accordingly, as respondents' July 2016 notice of appeal was not timely filed, respondents' appeal from the May 2016 supplemental order is dismissed (citations omitted).”).

CPLR 5513 - Appeal time does not begin to run until order or judgment is served with notice of entry

Bruzzese v. Bruzzese, 152 A.D.3d 563, 61 N.Y.S.3d 18 (2d Dep’t 2017) (“We reject the contention of nonparty Peter D. Barlet that the appeal from the money judgment dated March 20, 2015, must be dismissed as untimely taken. Initially, we note that Barlet did not move to dismiss the appeal on this ground. In any event, the record does not establish that the money judgment was ever served upon the plaintiff with ‘written notice of its entry,’ and thus, Barlet failed to meet his burden of establishing that the time within which to take an appeal from the money judgment ever began to run (citations omitted).”).

CPLR 5515 - Taking an appeal

CPLR 5515 - Appeal permitted where order differs from consent

Matter of Jordan v. Horstmeyer, 152 A.D.3d 1097, 60 N.Y.S.3d 549 (3d Dep’t 2017) (“Turning to the substance of the appeal from that order, Family Court denied the mother’s objections to the Support Magistrate’s order upon the ground that she could not challenge an order entered upon consent. While ‘[i]t is well settled that no appeal lies from an order issued on consent’ (citations omitted), that rule does not apply where the order ‘differs from or exceeds the consent’ (citation omitted). The arguments advanced by the mother fall within the exception to the rule barring appeals from consent orders and, accordingly, Family Court’s order must be reversed.”).

CPLR 5522 - Disposition of appeal

CPLR 5522 - Moot appeal

North Geddes St. Props., LLC v. Iglesia Misionera Monte DeSion, 2018 NY Slip Op 04150 (4th Dep’t 2018) (“Given the above described circumstances, we dismiss defendant's appeal from the first order. Plaintiff's cause of action for specific performance is now moot because the transaction has closed and defendant failed either to post the required bond or to appeal from the second order (citations omitted). In addition, although defendant purports to challenge the granting of its petition for permission to sell, we note that defendant is not aggrieved thereby (citation omitted).”).

Matter of Pelton v. Crummey, 156 A.D.3d 1305 (3d Dep’t 2017) (“Petitioner argues that this case falls within the narrow exception to the mootness doctrine in that ‘the issue to be decided, though moot, (1) is likely to recur, either between the parties or other members of the public, (2) is substantial and novel, and (3) will typically evade review in the courts’ (citations omitted). Petitioner was not ‘in custody’ following her arraignment on the felony complaint and, being “at liberty on bail,” a preliminary hearing could provide her nothing more than the dismissal of the felony complaint and the exoneration of her bail for the brief period between the end of the hearing and the issuance of an indictment against her (citations omitted). The outcome of the hearing would have no impact on her pretrial release status after she was indicted, as that issue would be addressed

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. at her arraignment on the indictment (citations omitted). Thus, in the absence of any deprivation of petitioner’s liberty, ‘the issue of whether [she] was denied a prompt preliminary hearing is not a significant or important question’ so as to fall within the exception to the mootness doctrine (citation omitted).”).

Matter of Nyjee H. (Jesse H.), 155 A.D.3d 951, 63 N.Y.S.3d 898 (2d Dep’t 2017) (“An adjudication of neglect constitutes a permanent and significant stigma that might indirectly affect a parent’s status in future proceedings (citations omitted). Thus, an appeal from an order of protection that is predicated on a finding of neglect is generally not rendered academic due to the expiration of the order of protection by its own terms (citations omitted). However, it is the finding of neglect underlying an order of protection that has enduring consequences (citations omitted). Accordingly, where, as here, the appellant consented to a finding of neglect without admission, and thus may not challenge the finding of neglect on appeal (citation omitted), an appeal from an order of protection that has expired by its own terms will be academic. Thus, the father’s appeal from so much of the order of disposition as directed him to comply with the order of protection that expired by its own terms must be dismissed (citation omitted).”).

Matter of DeChimay v. New York State Dept. of Corr. & Community Supervision, 152 A.D.3d 1128, 56 N.Y.S.3d 483 (3d Dep’t 2017) (“The Attorney General has advised the Court that, subsequent to Supreme Court’s decision, respondent again considered and denied petitioner’s application for merit termination of his sentence pursuant to Correction Law § 205, by decision dated November 16, 2016. Respondent’s more recent denial of merit termination in November 2016 rendered moot his challenge to the earlier, December 8, 2015 decision denying merit termination (citations omitted). The fact that Supreme Court misconstrued the petition is irrelevant to this analysis, as the challenged 2015 decision has been superceded by the 2016 decision, which petitioner is entitled to challenge. Petitioner does not argue that the exception to the mootness doctrine applies, and we do not find that there is a basis upon which to invoke the exception (citations omitted).”).

Matter of Colon v. Annucci, 151 A.D.3d 1061, 57 N.Y.S.3d 512 (2d Dep’t 2017) (“The Supreme Court properly concluded that the subject petition had been rendered academic by the petitioner’s release from Fishkill Correctional Facility, as the petitioner had received the ultimate relief he was seeking and any ruling on the petition would have no immediate and practical consequences to the petitioner. Moreover, the court did not improvidently exercise its discretion in declining to invoke an exception to the mootness doctrine to consider the merits of the petition (citation omitted). Significantly, as demonstrated by the petitioner’s submissions, the broader issues raised in the petition are not evading judicial review, but are in fact being litigated in other cases at the Supreme Court.”).

Lehman Commercial Paper, Inc. v. Point Prop. Co., LLC, 146 A.D.3d 1192, 45 N.Y.S.3d 662 (3d Dep’t 2017) (“We conclude that the appeal is moot to the extent that defendants challenge the order as affecting their right to redeem the subject commercial properties. In this regard, defendants assert various errors, which, according to them, artificially inflated the redemption price and precluded them from exercising their right to redeem the subject commercial properties. During the pendency of the appeal, however, the subject commercial properties were sold, thereby

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. extinguishing defendants’ right to redeem the properties (citation omitted). More critically, once lost, the right to redeem cannot be revived, even by court order (citation omitted). While defendants assert that the appeal is not moot to this extent because they are entitled to a vacatur of the foreclosure sale, which, in turn, could implicate their right to restitution (see CPLR 5523), there is no indication in the record that defendants moved either to vacate the judgment of foreclosure and sale or to set aside the foreclosure sale before Supreme Court. Accordingly, because defendants’ redemption rights in the subject commercial properties will not be directly affected by a decision of this Court, that aspect of defendants’ appeal concerning such redemption rights is moot (citation omitted). Defendants’ challenge to the reasonableness of the counsel fee award, however, is not moot (citation omitted).”).

Williams v. Annucci, 145 A.D.3d 1625, 42 N.Y.S.3d 894 (4th Dep’t 2016) (“Petitioner appeals from a judgment dismissing his petition pursuant to CPLR article 78 seeking to annul the determination denying him parole release. The Attorney General has advised this Court that, subsequent to that denial, petitioner reappeared before the Board of Parole in May of 2016 and was again denied release. Consequently, this appeal must be dismissed as moot (citation omitted). Contrary to petitioner’s contention, this matter does not fall within the exception to the mootness doctrine (citation omitted).”).

Matter of People of ex rel. Green v. Saunders, 145 A.D.3d 642, 42 N.Y.S.3d 812 (1st Dep’t 2016) (“This appeal challenging the legality of petitioner’s preconviction detention is moot, since petitioner is currently incarcerated pursuant to a judgment of conviction (citation omitted), and no exception to the mootness doctrine applies (citations omitted).”).

CPLR 5522 - Academic appeal – Exception “where necessary in order to prevent a judgment which is unreviewable for mootness from spawning any legal consequences or precedent”

Markowits v. Friedman, 144 A.D.3d 998, 42 N.Y.S.3d 52 (2d Dep’t 2016) (“‘While it is the general policy of New York courts to simply dismiss an appeal which has been rendered academic, vacatur of an order or judgment on appeal may be an appropriate exercise of discretion where necessary in order to prevent a judgment which is unreviewable for mootness from spawning any legal consequences or precedent’ (citations omitted). Here, the plaintiffs are correct that the Supreme Court lacked the authority to direct Alexander Markowits to participate in the arbitration, since the order compelling arbitration merely precludes Alexander Markowits from proceeding in the action (citation omitted). Further, the subject portion of the order could spawn adverse legal consequences for Markowits should the defendants seek to hold him in contempt for failing to comply with it. Accordingly, we vacate so much of the order as granted that branch of the Friedmans’ motion which was, in effect, to direct Alexander Markowits to notify the arbitrator, by March 19, 2015, of dates available to appear for an arbitration during the weeks of April 16, 2015, or April 24, 2015.”).

CPLR 5522 - Academic appeal

Matter of Powell v. Mount St. Mary Coll., 142 A.D.3d 1082, 38 N.Y.S.3d 217 (2d Dep’t 2016) (“On these appeals, the appellants seek to reinstate determinations expelling the petitioner from

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the nursing program at Mount Saint Mary College based on her alleged violation of the Student Code of Conduct. The petitioner has since graduated from the college and moves to dismiss the appeals as academic. ‘In general an appeal will be considered moot unless the rights of the parties will be directly affected by the determination of the appeal and the interest of the parties is an immediate consequence of the judgment’ (citations omitted). An appeal ‘is not moot if an appellate decision will eliminate readily ascertainable and legally significant enduring consequences that befall a party as a result of the order which the party seeks to appeal’ (citations). Here, the appellants do not take the position that success on their appeals could impair the petitioner’s diploma, and they have otherwise failed to identify any legally significant enduring consequence to them resulting from the order and judgment appealed from. Consequently, the appeals must be dismissed as academic.”).

CPLR 5526 - Content and form of record on appeal

CPLR 5526 - Insufficient record on appeal

Woodman v. Woodman, 2018 NY Slip Op 04479 (4th Dep’t 2018) (“Here, defendant contends that plaintiff did not timely respond to his discovery requests, and failed to disclose discovery material and to file a note of issue and certificate of readiness. The record on appeal, however, contains only the notice of appeal, the decision and order of Supreme Court, the pleadings, and excerpts from the transcript of a hearing, and thus the record does not contain the necessary and relevant motion papers and exhibits with respect to the issues raised on appeal. We note that, although defendant has attached some additional documents as exhibits to his appellant's brief, those documents are not properly part of the record on appeal (citations omitted).”).

County of Jefferson v. Onondaga Dev., LLC, 74 N.Y.S.3d 923 (4th Dep’t 2018) (“To the extent that the County contends that the encroachment was permissible under the doctrine of lateral support, the County's submissions in support of its motion do not contain that contention, and thus that contention is not properly before us (citation omitted). Although the County asserts that it raised that contention in the memoranda of law that it submitted in support of its motion, we note that the memoranda of law are not part of the record on appeal, and the County failed to object to defendant's submitted appendix and failed to submit its own appendix containing those memoranda (citations omitted).”).

CPLR 5528 - Content of briefs and appendices

CPLR 5528(a)(5) - Omission of relevant documents in appendix rendered it impossible for appellate court to determine issues

Wells Fargo Bank, N.A. v. Oyenuga, 64 N.Y.S.3d 905 (2d Dep’t 2017) (“In this mortgage foreclosure action, the defendant Modupe Oyenuga appeals from a judgment of foreclosure and sale, raising issues, inter alia, regarding service of the summons and complaint and the plaintiff’s delay in moving for a default judgment. Oyenuga perfected the appeal by using the appendix

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. method, but he did not include in the appendix the note and mortgage, the summons and complaint, the plaintiff’s motions for a default judgment and a judgment of foreclosure and sale, and all of the Supreme Court’s prior orders. The omission of these documents renders it impossible to determine any of the Oyenuga’s claims. Accordingly, the appeal must be dismissed (citation omitted).”).

ARTICLE 57- APPEALS TO THE APPELLATE DIVISION

CPLR 5701 - Appeals to appellate division from supreme and county courts

CPLR 5701 - Order on motion to compel a witness to answer questions propounded at a deposition is not appealable as of right

Donato v. Nutovits, 149 A.D.3d 1037, 52 N.Y.S.3d 488 (2d Dep’t 2017) (“An order denying a motion to compel a witness to answer questions propounded at an examination before trial is akin to a ruling made in the course of the examination itself and is not appealable as of right, even where it was made upon a full record and on the plaintiff’s motion to compel responses (citations omitted). Here, the plaintiff never sought leave to appeal. Under these circumstances, we decline to grant leave to appeal on the Court’s own motion (citations omitted). Accordingly, we dismiss the appeal.”).

CPLR 5701(a)(2) - Given extraordinary nature of sua sponte relief, the dismissal of the complaint, Appellate Division “nostra sponte” deems notice of appeal to be motion for leave and grants leave

All Craft Fabricators, Inc. v. ATC Assoc., Inc., 153 A.D.3d 1159, 60 N.Y.S.3d 660 (1st Dep’t 2017) (“To the extent that the order sua sponte dismissed the complaint, that portion of the order is not appealable as of right (citations omitted). However, given the extraordinary nature of the sua sponte relief, that is, dismissal of the complaint, we nostra sponte deem the notice of appeal from that portion of the order to be a motion for leave to appeal, grant such leave citations omitted), and reverse the order for the reasons stated above.”).

ARTICLE 62 - ATTACHMENT

CPLR 6201 - Grounds for attachment

CPLR 6201 - Court cannot attach real estate outside its jurisdiction; distinguishes Hotel 71 Mezz Lender LLC v. Falor, 14 N.Y.3d 303, 926 N.E.2d 1202, 900 N.Y.S.2d 698 (2010)

JSC VTB Bank v. Mavlyanov, 154 A.D.3d 560, 63 N.Y.S.3d 40 (1st Dep’t 2017) (“The court should not have ordered attachment of real estate located in California, i.e., outside its jurisdiction (citations omitted). Hotel 71 Mezz Lender LLC v. Falor, 14 N.Y.3d 303, 926 N.E.2d 1202, 900 N.Y.S.2d 698 (2010), is distinguishable. It involved uncertificated ownership/membership

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. interests in limited liability companies and a corporation, which could be attached by serving the manager of the entities in New York (citation omitted). By contrast, a sheriff levies on real property ‘by filing with the clerk of the county in which the property is located a notice of attachment’ (citation omitted). Even if a New York court could attach real estate located in California, we would stay all claims related to the California properties, because, only about a month after plaintiff sued here, it brought an action in that state against many of the same defendants as in the case at bar, alleging fraudulent conveyance with respect to the California properties. The California action ‘offers more’ than the case at bar (citations omitted), because, as plaintiff admits, a notice of pendency against the California properties can be filed only in that state, not here. It also appears that the California action will go to trial before the case at bar (citation omitted).”).

CPLR 6212 - Motion papers

CPLR 6212 - Wrongful attachment damages; Issuing restraining notices is not an attachment

Benzemann v. Citibank N.A., 149 A.D.3d 586, 53 N.Y.S.3d 33 (1st Dep’t 2017) (“Plaintiff’s claim for ‘wrongful attachment,’ which alleges that the defendants were collectively responsible for plaintiff’s property being wrongfully restrained, also fails. Plaintiff does not plead that there was an ‘attachment’ governed by article 62 of the CPLR, but rather that there were restraining notices issued pursuant to CPLR 5222. ‘The mere fact that property has been subjected to some form of restraint does not serve as a basis for the statutory claim of wrongful attachment’ (citation omitted). We adopt the Fourth Department’s reasoning.”).

CPLR 6212 - Wrongful attachment damages; Plaintiffs strictly liable for damages

Citibank, N.A. v. Keenan Powers & Andrews PC, 149 A.D.3d 484, 49 N.Y.S.3d 895 (1st Dep’t 2017) (“A finding of fault is not required to recover damages under this provision, as plaintiffs are ‘strictly liable’ for the damages they caused (citation omitted). Under the circumstances, we find that the full amount of defense costs incurred by Secure Title in the underlying litigation was recoverable as damages for plaintiffs’ wrongful attachment under CPLR 6212(e) (citations omitted).”).

ARTICLE 63 – INJUNCTION

CPLR 6301 - Grounds for preliminary injunction and temporary restraining order

CPLR 6301 - No jurisdiction to entertain injunction application because no action was pending

Matter of Town of Cicero v. Lakeshore Estates, LLC, 152 A.D.3d 1168, 60 N.Y.S.3d 730 (4th Dep’t 2017) (“‘[T]he valid commencement of an action is a condition precedent to [Supreme Court’s] acquiring the jurisdiction even to entertain an application for a[n] . . . injunction’ (citations

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. omitted). Here, however, there is no action supporting the application for an injunction. Indeed, the order to show cause and supporting papers themselves constitute the only request for an injunction. While ‘courts are empowered and indeed directed to convert a civil judicial proceeding not brought in the proper form into one which would be in proper form, rather than to grant a dismissal’ (citation omitted), more than improper form is involved here (citation omitted). Converting the order to show cause and supporting papers into a summons and complaint in these circumstances would effectively permit the Town to seek an injunction by motion, a result that is at odds with the well-established principle that ‘[t]he pendency of an action is an indispensable prerequisite to the granting of a[n] . . . injunction’ (citations omitted). We thus conclude that the court lacked jurisdiction to entertain the Town’s request (citation omitted). Without an underlying action the order putatively on appeal does not constitute an appealable paper (citation omitted). The appeal must therefore be dismissed.”).

Lynn v. Sterling Natl. Bank, 151 A.D.3d 1049, 54 N.Y.S.3d 864 (2d Dep’t 2017) (“Here, the plaintiff moved for a preliminary injunction against the defendants when there was no judicial action pending between the parties. As a result, the Supreme Court lacked the authority to grant a preliminary injunction pursuant to CPLR 6301 (citation omitted). Accordingly, the court properly denied the plaintiff’s motion for a preliminary injunction.”).

CPLR 6312 - Motion papers

CPLR 6312(b) - Preliminary injunction, not TRO, was appropriate, and the former REQUIRES an undertaking

Slifka v. Slifka, 2018 NY Slip Op 04515 (1st Dep’t 2018) (“The court erred in enjoining the sale of property at issue pending the decision by the Surrogate pursuant to a temporary restraining order, which does not require an undertaking (citation omitted). The TRO is merely a provisional remedy pending a hearing on a motion for a preliminary injunction (citation omitted), and the court did not schedule a hearing on plaintiffs' motion. However, it issued the ‘stay/TRO’ after allowing both sides an opportunity to be heard. Thus, the relief is in fact a preliminary injunction, and plaintiffs are required to post an undertaking (citation omitted). We remand to Supreme Court to fix the amount of the undertaking (citations omitted).”).

CPLR 6312(b) - I’ll say it again, an undertaking is required

Vassenelli v. City of Syracuse, 160 A.D.3d 1412, 75 N.Y.S.3d 724 (4th Dep’t 2018) (“Plaintiff contends that the court erred in denying that part of his application seeking a waiver of the undertaking pursuant to CPLR 6312 (b). We reject that contention. CPLR 6312 (b) directs a court to fix an undertaking in an amount that will compensate a defendant for damages incurred by reason of the granting of a preliminary injunction in the event that it is finally determined that a plaintiff was not entitled to the injunction. Plaintiff, as the party herein who sought a preliminary injunction, was clearly and unequivocally required to post an undertaking (citations omitted). Contrary to plaintiff's contention, the court had ‘no power to dispense with the undertaking required by CPLR 6312 (b)’ (citations omitted). We reject plaintiff's further contention that the

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. court erred in applying state law rather than federal law in considering whether to waive the undertaking. Inasmuch as plaintiff expressly requested injunctive relief under CPLR article 63 based on the alleged failure of the City to act in accordance with the General Municipal Law, we conclude that the court properly applied CPLR 6312 (b). We further conclude that the court did not improvidently exercise its discretion in fixing the amount of the undertaking (citation omitted).

ARTICLE 65 - NOTICE OF PENDENCY

CPLR 6501 - Notice of pendency; constructive notice

CPLR 6501 - Need ongoing action

Piller v. Tribeca Dev. Group LLC, 156 A.D.3d 1257 (3d Dep’t 2017) (“Further, as the complaint is reinstated against Eisner, there is an ongoing action in which ‘the judgment demanded would affect the title to, or the possession, use or enjoyment of, real property,’ and plaintiff’s notice of pendency must be reinstated (citations omitted).”).

CPLR 6514 - Motion for cancellation of notice of pendency

CPLR 6514(c) - Where the court invokes its inherent power to cancel the notice of pendency and not pursuant to CPLR 6514(c), the court has no authority to award costs and disbursements under CPLR 6514(c)

Congel v. Malfitano, 61 A.D.3d 807, 809, 877 N.Y.S.2d 443, 446 (2d Dep’t 2009). However, the court retains the right to award costs and attorneys’ fees under 22 NYCRR 130-1.1 for frivolous conduct. See Delidimitropoulos v. Karantinidis, 142 A.D.3d 1038, 38 N.Y.S.3d 36 (2d Dep’t 2016) (Appellate Division modifies lower court order, granting defendants’ motion to cancel notices of pendency and awarding defendants’ costs and attorneys’ fees pursuant to 22 NYCRR 130-1.1. Court finds that complaint does not seek relief that would affect title to, or the possession, use or enjoyment of real property. Thus, the lower court should have granted defendants’ motion to cancel the notice of pendency under its inherent power. Moreover, even though the court had no authority to award costs and disbursements under CPLR 6514(c), “the Supreme Court should have granted that branch of the defendants’ motion which was for an award of costs and attorney’s fees pursuant to 22 NYCRR 130-1.1. A litigant’s ability to file a notice of pendency is an ‘extraordinary privilege because of the relative ease by which it can be obtained’ (citation omitted) and because it permits a party ‘to effectively retard the alienability of real property without any prior judicial review’ (citation omitted). Here, the judgment demanded in the complaint clearly would not affect the title to, or the possession, use, or enjoyment of, any real property. Five months prior to making the instant motion, the defendants’ counsel advised the plaintiff that the notices of pendency were improperly filed, citing applicable case authorities, and requested removal of the notices of pendency in order to avoid motion practice. The plaintiff’s conduct in improperly filing the notices of pendency in the first instance, and then refusing to cancel them in response to the defendants’ demand, was ‘completely without merit in law and could not be supported by a reasonable

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. argument for an extension, modification, or reversal of existing law,’ and therefore, was ‘frivolous’ within the meaning of 22 NYCRR 130-1.1 (citation omitted).”).

ARTICLE 75 - ARBITRATION

CPLR 7501 - Effect of arbitration agreement

CPLR 7501 - Unambiguous language evinces parties’ unequivocal intent to arbitrate

Suckling v. Iu, 151 A.D.3d 664, 54 N.Y.S.3d 585 (1st Dep’t 2017) (“The dispute resolution clause (section 14.11) of the operating agreements for defendants 56 Edison LLC and 52 Reeve LLC provides that ‘the Members shall submit [certain] dispute[s] to an arbitration procedure’ (subd [b]; emphasis added). This unambiguous language evinces the parties’ ‘unequivocal intent to arbitrate the relevant dispute’ (citation omitted). The arbitration clause is no mere agreement to agree; it is ‘clear, explicit and unequivocal,’ and does not depend upon ‘implication or subtlety’ (citation omitted). Nor does the lack of a designated arbitration procedure render the clause unenforceable, because CPLR 7504 provides an objective method for supplying that missing term (citations omitted).”).

CPLR 7503 - Application to compel or stay arbitration

CPLR 7503 - Fee sharing agreement and Brady

Adams v. Kent Sec. of N.Y., Inc., 156 A.D.3d 588 (1st Dep’t 2017) (“Applying the foregoing standard, we hold that plaintiff has made a preliminary showing that the fee sharing and venue provisions in the arbitration agreement have the effect of precluding him from pursuing his statutory wage claim in arbitration. We remand for further proceedings, consistent with Brady, which, at a minimum, would include proof of plaintiff’s income and assets, as well as proof of the expected costs and fees to arbitrate this dispute in Florida. Because the parties’ arbitration agreements contains a severability clause, in the event plaintiff prevails on his claim that the aforementioned fee sharing and venue provisions should be held unenforceable under Brady, the matter should proceed to arbitration in New York, with defendant to bear the costs of the arbitration.”).

CPLR 7503 - Application to stay arbitration – Initiation and participation in arbitration precludes party from seeking stay

Matter of Mechtronics Corp. v. Kirchhoff-Consigli Constr. Mgt. LLC, 144 A.D.3d 688, 39 N.Y.S.3d 813 (2d Dep’t 2016) (“The Supreme Court properly denied the petition to permanently stay arbitration and granted the cross motion to compel arbitration. Pursuant to CPLR 7503(b), ‘a

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. party who has not participated in the arbitration . . . may apply to stay arbitration.’ The petitioner’s initiation of and participation in the arbitration proceeding precludes it from seeking a stay (citations omitted).”).

CPLR 7503 - No waiver of right to arbitrate

Sutphin Retail One, LLC v. Sutphin Airtrain Realty, LLC, 143 A.D.3d 972, 40 N.Y.S.3d 457 (2d Dep’t 2016) (“Contrary to the plaintiff’s contention, the defendants did not waive their right to arbitrate. Since the period of time between the service of the defendants’ answer and their motion to compel arbitration was not lengthy, the defendants’ conduct in this regard did not serve to waive the right to arbitrate (citation omitted).”).

CPLR 7503 - Petition to stay time- barred – agreement contained arbitration provision

Matter of Allstate Ins. Co. (Cappadonia), 143 A.D.3d 1266, 39 N.Y.S.3d 342 (4th Dep’t 2016) (“We agree with respondent that the petition to stay arbitration is time-barred because it was not filed within 20 days of respondent’s formal arbitration demand (citations omitted). Although the 20-day time limit of CPLR 7503 (c) does not apply if the parties never had ‘any agreement to arbitrate’ (citation omitted), the ‘Matarasso exception is inapplicable’ because ‘the contract[] at issue in this case contain[s] an arbitration provision’ (citations omitted). Indeed, so long as the subject insurance policy contains some type of arbitration agreement between the parties, as it does here, an untimely stay application which ‘conten[ds] that there is no coverage under [the] policy’s [SUM] provisions . . . is outside the [Matarasso] exception’ (citations omitted). Because the petition was untimely, the court had no power to entertain it (citations omitted).”).

CPLR 7503 / 7511 - Where arbitration clause stated that “[a]ny dispute arising under the terms of this agreement shall be resolved by the parties voluntarily submitting to binding arbitration,” and petitioner did not agree to arbitrate, the petition to vacate the award was correctly granted

Matter of Poma v. Arici, 75 N.Y.S.3d 910 (1st Dep’t 2018) (“Respondent's notice of arbitration did not contain the requisite language of CPLR 7503(c) and, therefore, petitioner was not precluded from raising threshold arbitration issues before the court (citations omitted). Threshold issues include whether the parties complied with the agreement (citations omitted). ‘Arbitration agreements are contracts and their meaning is to be determined from the language employed by the parties under accepted rules of contract law’ (citation omitted). By its plain language, the subject arbitration clause states that ‘[a]ny dispute arising under the terms of this agreement shall be resolved by the parties voluntarily submitting to binding arbitration,’ thus, where petitioner did not agree to arbitrate, the petition to vacate the award was correctly granted.”).

CPLR 7511- Vacating or modifying award

CPLR 7511 - Public policy precludes enforcement of penalty imposed by arbitrator

Matter of Bukowski (State of NY Dept. of Corr. & Community Supervision), 148 A.D.3d 1386, 50 N.Y.S.3d 588 (3d Dep’t 2017) (“Accordingly, in view of the statutory and regulatory prohibitions against the use of unjustified physical force and the imposition of corporal punishment in all circumstances, and given that Bukowski not only unquestionably engaged in such prohibited conduct here, but also thereafter repeatedly lied about his actions, thus evidencing a failure to acknowledge the magnitude of his misconduct, we conclude that public policy precludes enforcement of the penalty imposed by the arbitrator in this matter (citations omitted). In reaching this result, we take no position as to the penalty that ultimately should be imposed; the appropriate penalty, which should be both effective and sufficiently address the public policy considerations previously discussed, is a matter for the arbitrator to resolve pursuant to the terms of the collective bargaining agreement (citations omitted). Accordingly, we affirm Supreme Court’s order remitting the matter for the imposition of a new penalty.”).

CPLR 7511 - Arbitrator’s award was irrational and in conflict with CPLR 1209

Matter of Fast Care Med. Diagnostics, PLLC/PV v. Government Employees Ins. Co., 161 A.D.3d 1149 (2d Dep’t 2018) (“An arbitration award may be vacated if the court finds that the rights of a party were prejudiced by (1) corruption, fraud, or misconduct in procuring the award; (2) partiality of an arbitrator; (3) the arbitrator exceeding his or her power; or (4) the failure to follow the procedures of CPLR article 75 (see CPLR 7511[b]). In addition, an arbitration award may be vacated ‘if it violates strong public policy, is irrational, or clearly exceeds a specifically enumerated limitation on the arbitrator's power’ (citations omitted). An arbitration award may also be vacated where it is in ‘ explicit conflict' with established laws and ‘the strong and well-defined policy considerations' embodied therein’ (citations omitted). We agree with the Supreme Court that the arbitrator’s award was irrational and in conflict with CPLR 1209, which applies ‘only where an infant is a party’ to an arbitration proceeding (citations omitted). The infant patient was not a party to the arbitration; rather, Fast Care, as the infant’s assignee, was the party that brought the arbitration (citation omitted). Therefore, we agree with the court that the arbitrator disregarded established law in determining that the requirements of CPLR 1209 applied here (citations omitted). Furthermore, the master arbitrator’s determination that the assignment of benefits was not effective was not based on any requirement set forth in established law or regulations (citation omitted).”).

CPLR 7513 - Fees and expenses

CPLR 7513 - Award of attorneys’ fees did not exceed arbitrator’s power- “mutual demands for counsel fees in an arbitration proceeding constitute, in effect, an agreement to submit the issue to arbitration, with the resultant award being valid and enforceable”

Matter of R.F. Lafferty & Co., Inc. v. Winter, 161 A.D.3d 535 (1st Dep’t 2018) (“Respondent argues that the award of attorneys’ fees to petitioner exceeded the arbitrator’s power because the arbitration agreement did not expressly provide for attorneys’ fees (citations omitted). However, both parties demanded attorneys’ fees, and ‘mutual demands for counsel fees in an arbitration proceeding constitute, in effect, an agreement to submit the issue to arbitration, with the resultant award being valid and enforceable’ (citations omitted).”).

ARTICLE 78 - PROCEEDING AGAINST BODY OR OFFICER

CPLR 7801 - Nature of proceeding

CPLR 7801 - No final determination, no exhaustion of administrative remedies, no actual concrete injury

David L. Ferstendig, Once, Twice, Three Times a Maybe, 677 N.Y.S.L.D. 2 (2017).).

The Court of Appeals affirmed, but yet again on a different ground. The Court did not decide the issue as to whether the District had a private right of action. Instead, it assumed it did, but found that the State had not made a final determination, that the District had not established that it had exhausted its administrative remedies, and that the District was “unable to articulate any actual, concrete injury that it has suffered at this juncture.” 2017 N.Y. Slip Op. 02360 at ∗2. The Court noted that although the State had advised the District that its failure to comply could result in further enforcement actions, including the withholding of funds, the State had not made a final decision to withhold funds.

CPLR 7801 - Matter not ripe for judicial review

David L. Ferstendig, In Zoning Dispute, Petitioner Seeks to Annul Positive Declaration, 666 N.Y.S.L.D. 2, 3 (2016).

In Ranco Sand & Stone Corp. v. Vecchio, 2016 N.Y. Slip Op. 02477 (March 31, 2016), Ranco owned two pieces of contiguous property which were located in an area zoned for residential use. However, in 1997, Ranco leased one parcel to a private bus company which used the land as a trucking station and bus yard. Even though this was clearly a nonconforming use, the Town did not seek to enforce the residential zoning requirements. In 2002, Ranco sought to rezone the parcel to heavy industrial use.

In 2004, the Town Planning Board recommended approval of the application but no further action was taken for five years, when the Town Board adopted a resolution issuing a positive declaration pursuant to the State Environmental Quality Review Act (SEQRA) that the rezoning of the parcel “may have a significant effect on the environment.” It required Ranco to prepare a draft environmental impact statement (DEIS). Such a statement is to describe “significant adverse environmental impacts” and include alternatives and mitigation measures. It provides the agency with information to assist in assessing the possible environmental consequences.

Ranco commenced this CPLR Article 78 proceeding seeking to annul the positive declaration and requested mandamus relief. The respondent moved to dismiss for failure to state a cause of action. The Supreme Court granted the motion, finding that the issue was not ripe for judicial review. The Appellate Division affirmed, holding that the positive declaration did not give rise to a justiciable controversy.

Ranco argued that the requirement that it prepare a DEIS would cause it actual and real financial injury, and thus there was a justiciable controversy.

In order to bring an Article 78 proceeding to challenge an administrative action, it needs to be “final and binding upon the petitioner.” The issue here was whether the positive declaration was ripe for judicial review. The Court of Appeals noted that when challenging an action under SEQRA, a positive declaration is ripe for review when two requirements are met -

First, “the action must ‘impose an obligation, deny a right or fix some legal relationship as a consummation of the administrative process’” (citation omitted). This threshold requirement consists of “‘a pragmatic evaluation . . . of whether the decision maker has arrived at a definitive position on the issue that inflicts an actual, concrete injury’” (id.). Second, “there must be a finding that the apparent harm inflicted by the action ‘may not be prevented or significantly ameliorated by further administrative action or by steps available to the complaining party’” (id.).

Id. at *4.

The Court concluded that, in this action, Ranco satisfied only the first requirement, but not the second, and to accept Ranco’s position would, in essence, conflate the two requirements -

Indeed, Ranco’s approach would lead to convergence of the two requirements set forth in Gordon by reducing the analysis to whether a petitioner will incur unrecoverable costs. The inevitable result would be that every positive declaration requiring the creation of a DEIS would be ripe for review because the preparation of a DEIS by its nature carries financial costs that generally cannot be recouped, regardless of the outcome of the SEQRA process and the ultimate determination on a petitioner’s zoning application. However, courts should seek to avoid this type of “piecemeal review of each determination made in the context of the SEQRA process [which] would subject it to ‘unrestrained review. . . result[ing] in significant delays in what is already a detailed and lengthy process’” (citation omitted).

Id. at *5.

The Court of Appeals noted that generally a positive declaration that requires a DEIS is not a final agency action, but rather an initial step in the SEQRA process.

CPLR 7801 - Availability of Mandamus-does not lie to enforce the performance of a duty that is discretionary

Matter of Mount Bldrs., LLC v. Oddo, 152 A.D.3d 694, 58 N.Y.S.3d 594 (2d Dep’t 2017) (“‘Mandamus lies to compel the performance of a purely ministerial act where there is a clear legal right to the relief sought’ (citations omitted). ‘Thus, mandamus does not lie to enforce the performance of a duty that is discretionary, as opposed to ministerial’ (citations omitted). Here, the respondent complied with the November 9, 2015, judgment. Since the naming of the new

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. streets was within the discretion of the respondent, the petitioner has failed to show a clear legal right to relief in the nature of mandamus. Accordingly, the Supreme Court properly denied the motion.”).

Matter of James v. City of New York, 154 A.D.3d 424, 60 N.Y.S.3d 810 (1st Dep’t 2017) (“In any event, petitioners are not entitled to the ‘extraordinary remedy’ of mandamus (citation omitted), which ‘is generally not available to compel government officials to enforce laws and rules or regulatory schemes that plaintiffs claim are not being adequately pursued’ (citation omitted). The relief sought does not concern mere ‘acts which are mandatory but are executed through means that are discretionary,’ but involves ‘acts the exercise of which is discretionary’ (citation omitted), such as deciding whether to seek penalties for particular violations of Administrative Code of City of NY § 19-605(a) by bus companies in performing their contracts with respondent Department of Education.”).

CPLR 7803 - Questions raised

CPLR 7803 - Determination was not arbitrary and capricious

Matter of Krug v. City of Buffalo, 2018 NY Slip Op 04118 (4th Dep’t 2018) (“We reject respondent's contention that its determination was not arbitrary and capricious. Respondent has a duty to provide a defense to petitioner ‘if his alleged conduct occurred or allegedly occurred while he was acting within the scope of his public employment or duties’ (citations omitted), and the determination that petitioner was not acting within the scope of his public employment or duties ‘may be set aside only if it lacks a factual basis, and in that sense, is arbitrary and capricious’ (citation omitted). Here, it is undisputed that petitioner was on duty and working as a police officer when the alleged conduct occurred (citation omitted).”).

CPLR 7803(4)

David L. Ferstendig, Split Opinion on Whether NYC Commission on Human Rights’ Determination Was Supported By Substantial Evidence, 691 N.Y.S.L.D. 2-3 (2018).

Split Opinion on Whether NYC Commission on Human Rights’ Determination Was Supported By Substantial Evidence

Did Petitioners Carry Burden Of Demonstrating Undue Hardship?

As practitioners are well aware, the questions that can be raised on a CPLR Article 78 proceeding brought to challenge a determination are limited. See CPLR 7803. One of these questions is "[w]hether a determination made as a result of a hearing held, and at which evidence was taken, pursuant to direction by law is, on the entire record, supported by substantial evidence." CPLR 7803(4)

Here, we are also dealing with a similar provision, Administrative Code of City of New York § 8- 123(e), which provides that the findings of the New York City Commission on Human Rights (Commission) "shall be conclusive if supported by substantial evidence on the record considered as a whole."

In Matter of Marine Holdings, LLC v. New York City Comm. on Human Rights, 2018 N.Y. Slip Op. 03303 (May 8, 2018), the petitioners’ tenant had filed a complaint with the Commission, alleging that the petitioners had discriminated against the tenant – who could not enter or leave the apartment without being carried – by refusing her request to install a handicap (wheelchair) accessible entrance to her apartment. The petitioners brought this proceeding, challenging the Commission’s determination, directing them to install a wheelchair-accessible entrance, which involved converting a window into a doorway and installing a ramp.

After the Commission issued a probable cause determination, a hearing was conducted, and the Administrative Law Judge (ALJ) found that petitioners did not discriminate unlawfully against the tenant because providing the proposed accommodation would create an undue hardship.

However, the Commission rejected the ALJ’s findings; found that the petitioners did not carry their burden to establish undue hardship and that they unlawfully discriminated against the tenant and were required to make the modification; awarded the tenant $75,000 as damages for mental anguish; and imposed a $125,000 civil penalty.

The trial court denied the petition in part, ruling that the Commission’s "determination that [petitioners] did not establish the affirmative defense of undue hardship based upon structural infeasibility is supported by substantial evidence in the record." Id. at ∗3. The Appellate Division reversed, finding that "the record did not contain any substantial evidence rebutting the petitioners’ showing that it would be structurally infeasible to install a handicapped accessible entrance to [the tenant’s] apartment." Id.

A majority of the Court of Appeals reversed, ruling that there was substantial evidence to support the Commission’s conclusion that petitioners did not carry their burden of demonstrating undue hardship in the conduct of their business because the requested accommodation would be structurally infeasible. The relevant Administrative Code provision (§ 8-107(15)(a)) requires that "reasonable accommodations," defined as an accommodation that "shall not cause undue hardship in the conduct of the covered entity’s business" (NYC Administrative Code § 8-102(18)), be made for persons with disabilities.

The Court focused on evidence presented at the hearing that the petitioners had done a similar window-to-door conversion elsewhere in its residential complex:

No evidence was presented that this prior window-todoor conversion had imposed any hardship on petitioners, and substantial evidence supports the determination that petitioners did not prove that the proposed conversion would require alterations significantly different from the previous one. The Commission could rationally

conclude that petitioners failed to carry their burden of proving that the proposed accommodation would cause undue hardship in the conduct of their business.

Id. at ∗1.

The dissent concluded to the contrary that the Commission’s determination was not supported by substantial evidence and that the petitioners had met their burden of proving their undue hardship claim. It maintained that the Commission applied an improper standard, that is, whether the requested accommodation could be done, or was theoretically possible:

An accommodation need not be physically impossible to cause an undue hardship, because most accommodations are theoretically possible—indeed, it is "possible" for petitioners to construct an entirely new building to accommodate the tenant. Instead, the reasonable accommodation standard requires an examination of whether the accommodation will "cause undue hardship in the conduct of the covered entity’s business" (NYC Admin Code § 8-102 [18]). That all experts agreed that the work "could be done" is in no way dispositive. When the proper standard is applied, it is evident that petitioners’ business, that of providing housing to its tenants, will suffer an undue hardship from this accommodation, as there is a possibility that neighbors will be displaced, that neighboring apartments will be harmed, that the building may be structurally degraded, and that gas lines could be ruptured.

Id. at ∗4.

Moreover, a modification can be "structurally feasible" and still cause undue hardship. The dissent noted that the Commission’s improper summary dismissal of the petitioners’ structural engineer’s observation of the differences between the accommodation requested here and the accommodation provided in another of the petitioners’ buildings was irrational. They included "the width of the windows, the lack of gas lines below the management office, and the length of the necessary ramp." Id.

CPLR Article 78

David L. Ferstendig, Divided Court Holds First Responders Are Not Entitled to Accidental Disability Retirement Benefits, 688 N.Y.S.L.D. 2-3 (2018)

Divided Court Holds First Responders Are Not Entitled to Accidental Disability Retirement Benefits

Majority Finds That Substantial Evidence Supported Respondent’s Determinations That Petitioners Were Not Incapacitated As A Result of an Accident

The decision in Matter of Kelly v. DiNapoli, 2018 N.Y. Slip Op. 01016 (February 13, 2018), was the result of the appeal of two actions, both dealing with whether the petitioners, each first

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. responders, were entitled to accidental disability retirement benefits (that are generally more generous than performance of duty disability retirement benefits). The issue, more precisely, was whether the petitioners were incapacitated "as the natural and proximate result of an accident … sustained in … service." Retirement and Social Security Law § 363(a)(i) (RSSL).

James J. Kelly was a police officer on duty during Hurricane Sandy who was sent with another officer to a home on which a tree had fallen, trapping the residents. The house appeared to be "very unstable" and there were downed wires. Operating under the belief that the fire department technical response unit would be delayed for several hours, Kelly entered the home in response to "blood-curdling screams" for help. When inside, Officer Kelly saw a resident impaled. While clearing away debris to free individuals under a pile of debris, he felt pain in his shoulder. When a rafter that was dangling from the roof began to fall, he reached up to brace the rafter (to avoid injury to another officer) further injuring his shoulder and neck.

When Kelly applied for accidental disability retirement benefits, the Hearing Officer found that the injurycausing incident was "an accident" under RSSL § 363 because "[e] ntering that unstable structure was not within [petitioner’s] regular and usual duties." Id. at ∗2. However, the respondent Comptroller overruled the Hearing Officer, and the Appellate Division confirmed the determination in an ensuing Article 78 proceeding.

Pat Sica was a firefighter, injured when responding to a medical emergency of an individual with breathing difficulties at a local supermarket. Shortly after assisting two unconscious individuals, he took ill and was taken to an emergency room. It was later revealed that he had been exposed to toxic gases in the supermarket, leading to a disabling heart condition. When Sica applied for accidental disability retirement benefits, the Hearing Officer found that the incident was an "accident" and his injuries "resulted from an unexpected and unforeseeable event, which arose during the performance of [Sica’s] routine employment duties." Id. The Comptroller overruled the Hearing Officer’s determination. However, the Appellate Division annulled the Comptroller’s determination, concluding "that Sica ‘was not responding to a fire that presented the inherent and foreseeable risk of inhaling toxic gases or smoke,’ and that he ‘was neither aware that the air within the supermarket contained toxic chemical gases, nor did he have any information that could reasonably have led him to anticipate, expect[,] or foresee the precise hazard when responding to the medical emergency at the supermarket’ (citation omitted)." Id. at ∗3.

The Court of Appeals was unanimous in finding that Mr. Sica was not entitled to accidental disability retirement benefits, but was divided on the denial to Mr. Kelly. The majority noted that its prior precedent established that an injury-causing incident is considered "accidental" when it is "sudden, unexpected and not a risk of the work performed." Id. at ∗4. The Court emphasized that the focus is on the "precipitating cause of injury" and not on "the petitioner’s job assignment." Id.

In evaluating the respondent’s determination, the substantial evidence standard applied. That standard, which the Court characterized as "not an exacting one," "is less than a preponderance of the evidence … [and] demands only that a given inference is reasonable and plausible, not necessarily the most probable" Id. at ∗5. Based on this standard, the Court held that respondents’ determinations were rational. It concluded that there was substantial evidence that neither

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. petitioner was injured as a result of an "accident" because there were no "precipitating accidental event[s] … which w[ere] not a risk of the work performed." Id. at ∗4. The respondent could have rationally concluded that the petitioners "were acting within the scope of their ‘ordinary employment duties, considered in view of the particular employment in question,’ and that there was no sudden, unexpected event that was not an inherent risk of petitioners’ regular duties (emphasis added)." Id. at ∗5.

In Kelly, the respondent concluded that the officer was expected to assist injured persons and to respond to emergencies. Significantly, while acknowledging that "a different result would not have been unreasonable," the Court concluded that there was substantial evidence to support the determination. In Sica, the majority similarly found that substantial evidence supported the respondent’s conclusion that Sica was performing his regular duties as a firefighter; that he had been trained for the risk of exposure to toxic substances; that he had responded to a gas leak in the past; and that his job duties specifically required him to work "with exposure to … fumes, explosives, toxic materials, chemicals and corrosives.”

The dissent, written by Judge Wilson, agreed that the Comptroller’s determination in Sica should be reinstated because, "[a]s a firefighter, job-related exposure to toxic fumes is to be expected, and firefighters receive relevant training (Mr. Sica testified as much) and are provided protective gear to don when appropriate." Id.

However, he disagreed with the majority on Police Officer Kelly. The dissent noted that the rescue here was a job for firefighters, not the police, but because of the unavailability of the fire department, the officers attempted the rescue, during which the rafter gave way. The Comptroller’s rationale rested on the proposition that because emergency response is part of police officers’ jobs, anything that happens is not an accident. The dissent insisted that the proper analysis should begin with determining whether the nature of the hazard was a part of the bargained-for risks of the job; and if it was outside the bargainedfor risks, to then assess whether it was "sufficiently out of the ordinary risks of everyday life to constitute an accident." Id. at ∗6. It concluded that entering a collapsing building and confronting falling rafters during a hurricane when fire and EMS workers were unavailable is a hazard outside the bargained-for risks of the job. Moreover, the hazard was "out of the ordinary":

In the ordinary course of our lives, we bend over; we rise from chairs; we walk down steps, some of which were previously visited by dogs; but we do not save lives by deflecting burning beams in collapsing homes during a hurricane — we imagine that for superheroes.

Id. at ∗7.

ARTICLE 83 - DISBURSEMENTS AND ADDITIONAL ALLOWANCES

CPLR 8303-a - Frivolous claims

CPLR 8303-a; 22 NYCRR 130- Plaintiff’s conduct was frivolous, meriting award of costs and attorneys’ fees

Divito v. Fiandach, 160 A.D.3d 1404 (4th Dep’t 2018) (“We also reject plaintiff's various procedural challenges. The record belies his contention that the court erred in making the award sua sponte without affording him an opportunity to be heard (citation omitted). Defendant's motion explicitly sought an award of costs and attorney's fees resulting from plaintiff's frivolous conduct, and plaintiff had an opportunity to respond to that motion. Furthermore, contrary to plaintiff's contention, the court issued a written decision explicitly ‘setting forth the conduct on which the award . . . [was] based, [and] the reasons why the court found the conduct to be frivolous’ (citation omitted). The decision also adequately explained why the amount of the award was appropriate (citation omitted). We conclude that it is self-evident that the cost of vacating an income execution based upon false representations concerning a nonexistent default judgment should be shouldered by the party responsible for preparing and serving it.”).

CPLR 8303-a; 22 NYCRR 130 - Sanctions awarded

ATS-1 Corp. v. Rodriguez, 156 A.D.3d 674, 67 N.Y.S.3d 60 (2d Dep’t 2017) (“Under the circumstances of this case, including, but not limited to, the appellants’ attempt to vacate the stipulation of settlement based upon their purported mistake, we find that much of the conduct of the appellant Cirilo Rodriguez and attorney George W. Echevarria, including their prosecution of this appeal, which is based upon the same meritless arguments advanced on the cross motion to vacate the stipulation of settlement, has been “undertaken primarily to delay or prolong the resolution of the litigation” (citation omitted). We find that this conduct warrants sanctions in the amount of $500 each on the appellant Cirilo Rodriguez and attorney George W. Echevarria.”).

Liang v. Wei Ji, 155 A.D.3d 1018, 66 N.Y.S.3d 321 (2d Dep’t 2017) (“Moreover, we reject the plaintiff’s contention that the order directing the imposition of a sanction against him failed to comply with 22 NYCRR 130-1.2. That rule provides that ‘[t]he court may award costs or impose sanctions or both only upon a written decision setting forth the conduct on which the award or imposition is based, the reasons why the court found the conduct to be frivolous, and the reasons why the court found the amount awarded or imposed to be appropriate.’ Courts have not held that the procedural dictates of 22 NYCRR 130-1.2 must be followed ‘in any rigid fashion’ (citations omitted). Here, in the order appealed from, the Supreme Court discussed the reasons why it was directing dismissal of the complaint. It then cited 22 NYCRR 130-1.1(a), and stated that the branch of the motion which was for the imposition of a sanction in the amount of $160 was granted. It is clear from the context of the order that the court found the plaintiff’s conduct to be frivolous for

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. the same reasons it gave for directing dismissal of the complaint. Accordingly, the order did not fail to comply with the requirements of 22 NYCRR 130-1.2.”).

CPLR 8303-a; 22 NYCRR 130 – Plaintiff’s counsel acted frivolously

Retained Realty, Inc. v. 1828 51, LLC, 153 A.D.3d 1438, 61 N.Y.S.3d 611 (2d Dep’t 2017) (“Here, the record demonstrates that the Supreme Court providently exercised its discretion in finding that the plaintiff’s counsel acted frivolously in renewing the motion for an order of reference premised upon the defendants’ default in answering or appearing despite being on notice, based upon prior motion practice, that an answer had been interposed on behalf of the defendants. In addition, counsel’s misrepresentation to the court of the nature of the relief sought in its renewed motion warranted the award of an attorney’s fee to the defendants pursuant to 22 NYCRR 130-1.1 (citations omitted). Thus, the court properly stated the basis of its determination that the plaintiff’s counsel engaged in frivolous conduct in accordance with 22 NYCRR 130-1.2.”).

CPLR 8303-a; 22 NYCRR 130 - Frivolous appeal – knowingly false claim

Boye v. Rubin & Bailin, LLP, 152 A.D.3d 1, 56 N.Y.S.3d 57 (1st Dep’t 2017) (“Here, counsel was ethically obligated to withdraw any baseless and false claims, if not upon his own review of the record, certainly by the time Supreme Court advised him of this fact. Instead, counsel continued to repeat a knowingly false claim in what could only be described as a purposeful attempt to mislead this Court, and pursued claims which were completely without merit in law or fact. The appropriate remedy for maintaining a frivolous appeal is the award of sanctions in the amount of the reasonable expenses and costs including attorneys’ fees incurred in defending the appeal (citation omitted).”).

CPLR 8303-a; 22 NYCRR 130 - Plaintiff’s conduct clearly frivolous

Place v. Chaffee-Sardinia Volunteer Fire Co., 143 A.D.3d 1271, 39 N.Y.S.3d 568 (4th Dep’t 2016) (“Here, plaintiff’s conduct was clearly frivolous inasmuch as she submitted an affidavit that disregarded a court order and, in response to a second order, she submitted a second affidavit that contained a material falsehood. When that conduct is viewed along with plaintiff’s failure to comply with discovery demands and other orders, we conclude that it was an abuse of discretion for the court to refuse to sanction plaintiff. We therefore modify the order in appeal No. 1 by granting that part of defendants’ cross motion seeking sanctions pursuant to 22 NYCRR 130-1.1, and we remit the matter to Supreme Court for the determination of an appropriate sanction (citations omitted).”).

CPLR 8303-a; 22 NYCRR 130 - Significant award of attorneys’ fees

Board of Mgrs. of Foundry at Wash. Park Condominium v. Foundry Dev. Co., In, 142 A.D.3d 1124, 38 N.Y.S.3d 60 (2d Dep’t 2016). (“Here, contrary to the appellant’s contention, the award of an attorney’s fee to BSRB for McDonough’s services in preparation of BSRB’s motion to dismiss was not improper, notwithstanding that McDonough’s fee was actually paid by BSRB’s malpractice insurance carrier, and without regard to the nature of the fee arrangement between

BSRB and McDonough. While compensatory sanctions should correspond at least to some degree to the amount of damages, the aggrieved party is not always required to show ‘actual pecuniary loss’ (citations omitted). Contrary to the appellant’s further contention, the fact that BSRB was the client, not the counsel of record, in Action No. 3, did not preclude the portion of the fee award which was for the work performed by its partner, Gardiner S. Barone, in assisting McDonough with preparation of the motion to dismiss the action. An attorney such as Mr. Barone, who represents himself, may recover fees for ‘the professional time, knowledge and experience . . . which he would otherwise have to pay an attorney for rendering’ (citations omitted). Under the circumstances, the Supreme Court providently exercised its discretion in awarding BSRB an attorney’s fee and disbursements in the total sum of $29,968.70. The appellant’s remaining contentions are either not properly before this Court, improperly raised for the first time on appeal, or without merit.”).

CPLR 8303-a; 22 NYCRR 130 - Improper filing of notice of pendency in first instance and then refusal to cancel in response to defendant’s demand was frivolous conduct

Delidimitropoulos v. Karantinidis, 142 A.D.3d 1038, 38 N.Y.S.3d 36 (2d Dep’t 2016) (Appellate Division modifies lower court order, granting defendants’ motion to cancel notices of pendency and awarding defendants’ costs and attorneys’ fees pursuant to 22 NYCRR 130-1.1. Court finds that complaint does not seek relief that would affect title to, or the possession, use or enjoyment of real property. Thus, the lower court should have granted defendants’ motion to cancel the notice of pendency under its inherent power. Moreover, even though the court had no authority to award costs and disbursements under CPLR 6514(c), “the Supreme Court should have granted that branch of the defendants’ motion which was for an award of costs and attorney’s fees pursuant to 22 NYCRR 130-1.1. A litigant’s ability to file a notice of pendency is an “extraordinary privilege because of the relative ease by which it can be obtained” (citation omitted) and because it permits a party “to effectively retard the alienability of real property without any prior judicial review” (citation omitted). Here, the judgment demanded in the complaint clearly would not affect the title to, or the possession, use, or enjoyment of, any real property. Five months prior to making the instant motion, the defendants’ counsel advised the plaintiff that the notices of pendency were improperly filed, citing applicable case authorities, and requested removal of the notices of pendency in order to avoid motion practice. The plaintiff’s conduct in improperly filing the notices of pendency in the first instance, and then refusing to cancel them in response to the defendants’ demand, was “completely without merit in law and could not be supported by a reasonable argument for an extension, modification, or reversal of existing law,” and therefore, was “frivolous” within the meaning of 22 NYCRR 130-1.1 (citation omitted).”).

CPLR 8303-a; 22 NYCRR 130 - Absence of hearing not fatal to award

He v. Realty USA, 150 A.D.3d 1418, 55 N.Y.S.3d 477 (3d Dep’t 2017) (“This Court had already found that plaintiff had engaged in frivolous conduct by commencing and pursuing this action against defendants (citation omitted), leaving to Supreme Court the limited issue of how much in costs and reasonable counsel fees to award. Plaintiff was entitled to be heard on that issue, but ‘[t]he form of the hearing . . . depend[ed] upon the nature of the conduct and the circumstances of the case’ (citations omitted). Supreme Court stated its intention to resolve the issue on papers

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. unless the need for a hearing was shown. Counsel for defendants submitted an affirmation in which he stated that he had been retained by them in 2012 and, referencing an attached interim bill detailing the legal work performed and expenses incurred as a result of this action, opined that the amount sought was reasonable and necessary. Plaintiff failed to offer any criticism of the requested costs and counsel fees beyond complaining in conclusory fashion that they were ‘illegal and excessive.’ There was no request for a hearing by the parties and, given the state of the papers, no reason to hold one. Accordingly, in the absence of any substantive factual dispute, Supreme Court did not abuse its discretion in determining the amount of costs and reasonable counsel fees on papers (citations omitted). Supreme Court made that determination in a written order finding that the requested costs and counsel fees were appropriate and, suffice it to say, its decision to do so finds ample support in the record (citations omitted).”).

ARTICLE 86 - COUNSEL FEES AND EXPENSES IN CERTAIN ACTIONS AGAINST THE STATE

CPLR 8601 / 8602

David L. Ferstendig, Split Court of Appeals Tackles Reach of New York’s Equal Access to Justice Act, 679 N.Y.S.L.D. 1,2 (2017).

CPLR Article 86, better known as the New York State Equal Access in Justice Act (EAJA), is based on the Federal Equal Access to Justice Act, 28 U.S.C. § 2412(d). New York’s EAJA provides in pertinent part that

except as otherwise specifically provided by statute, a court shall award to a prevailing party, other than the state, fees and other expenses incurred by such party in any civil action brought against the state, unless the court finds that the position of the state was substantially justified or that special circumstances make an award unjust.

CPLR 8601(a).

The statute is intended to assist litigants with limited means to be able to retain counsel to litigate wrongful actions of the State.

In Kimmel v. State of New York, 2017 N.Y. Slip Op. 03689 (May 9, 2017), the Court of Appeals was confronted with the question of whether the EAJA applies to a prevailing plaintiff in a Human Rights Law (HRL) sex discrimination employment case against the State. The plaintiff here was a New York State Trooper who alleged sexual harassment, retaliation based on her sex, and exposure to a hostile work environment. She was often the first woman to serve in a particular police station. Over a ten-year period following the 1995 commencement of this litigation, the State engaged in “obstructionist and delaying tactics,” resulting in the Appellate Division striking the State defendants’ answers. Ultimately, the jury awarded over $700,000, and the plaintiff’s counsel (both current and former) sought attorneys’ fees and costs under the EAJA.

The trial court held that attorneys’ fees and costs could not be awarded. A divided Appellate Division reversed. In another split decision, the Court of Appeals affirmed. The plurality noted that the plain meaning of the statute covered this situation and provided only two exceptions - if another statute specifically provides for attorneys’ fees (which the HRL did not at the time this action was commenced); or to an action in the Court of Claims (this action was brought in the Supreme Court under Executive Law § 297(9)). The Court stressed that where a statute includes specific exceptions, generally unmentioned exceptions do not apply.

The crux of the difference between the plurality and dissent focused on the EAJA’s definition of the word “action” used in CPLR 8601(a). CPLR 8602(a) defines “action” as “any civil action or proceeding brought to seek judicial review of an action of the state.” The plurality interpreted that phrase to include two different possibilities. One is any civil action regardless of the relief sought. The second is a proceeding brought to seek judicial review. Under this interpretation, the requirement that the relief sought be for the “judicial review of an action of the state” did not apply to a civil action. The State and the dissent asserted that the term “judicial review” modified and placed an express limitation on “‘any civil action,’ thereby excluding cases, like this one, that seek compensatory damages.” Id. at *4. In other words,

the term judicial review modifies both “any civil action” and “proceeding” and, therefore, restricts EAJA awards to prevailing parties in article 78 proceedings, as well as a limited subset of civil actions seeking review of a state agency’s administrative actions.

Id.

The plurality opinion rejected this analysis, arguing that when interpreting a statute, one should avoid making any of its provisions superfluous. The Court pointed out that CPLR Article 78 proceedings and declaratory judgment actions cannot be brought in the Court of Claims (and must be brought in the Supreme Court), rendering the exclusion already in the statute concerning actions in the Court of Claims superfluous. “Under the state defendants’ interpretation, therefore, the statutory exclusion for ‘an action brought in the court of claims’ would have no meaning.” Id. at *4-5.

Moreover, prior to the enactment of the EAJA, the Court had held that HRL claims against the State seeking monetary relief could be brought in the Supreme Court. Since the legislature “is presumed to have known” of the Court’s decision when it enacted EAJA years later, “the Court of Claims exclusion was not intended to exclude Human Rights Law claims from eligibility for an EAJA award.” Id. at *5.. The Court emphasized that the legislative history and remedial nature of the statute supported its interpretation.

The plurality opinion also pointed to a 2015 amendment to the Human Rights Law for further support -

Finally, attorneys’ fees and costs are now specifically provided for under the Human Rights Law in cases of housing discrimination and in cases of sex discrimination in credit or employment (L 2015, ch 364, § 1). The 2015 amendment reflects the legislature’s acknowledgment that feeshifting provisions are appropriate in the area of Human Rights Law violations. The amendment also means that attorneys’ fees in certain civil actions and proceedings brought under the Human Rights Law alleging sex discrimination will no longer be subject to the EAJA’s limiting requirements but to the separate requirements set forth in the Human Rights Law itself.

Id. at *10.

In his dissent, Justice Garcia characterized the EAJA as a “fee shifting” statute in derogation of the common law, rather than a “remedial” one, and, as such, it should be construed strictly. He concluded that the plurality opinion, applying CPLR Article 86 to an action seeking predominantly compensatory damages, was contrary to the legislative history and the case law interpreting the statute -

The meaning of article 86 has been plain to courts in this State for the past 28 years. New York courts have applied article 86 only in the context of article 78 proceedings, declaratory judgment actions, and actions for injunctive relief. In more than 70 published cases contemplating article 86, courts have considered it exclusively in the context of actions seeking judicial review of agency administrative actions…. During the same period, in more than 10 annual reports made of fee awards under the EAJA, there is no record of a single case in which plaintiff attempted to obtain attorneys’ fees under article 86 in a suit seeking predominantly compensatory damages – until now.

Id. at *18-19.

CPLR 8601 / 8602 - Petitioner was not a prevailing party

Matter of Gonzalez v. New York State Dept. of Corr. & Community Supervision, 152 A.D.3d 680, 59 N.Y.S.3d 393 (2d Dep’t 2017) (“Under the State EAJA, ‘a court shall award to a prevailing party, other than the state, fees and other expenses incurred by such party in any civil action brought against the state, unless the court finds that the position of the state was substantially justified or that special circumstances make an award unjust’ (CPLR 8601[a]). CPLR 8601(b) provides that ‘[a] party seeking an award of fees and other expenses shall, within thirty days of final judgment in the action, submit to the court an application which sets forth (1) the facts supporting the claim that the party is a prevailing party and is eligible to receive an award under this section, (2) the amount sought, and (3) an itemized statement from every attorney or expert witness for whom fees or expenses are sought stating the actual time expended and the rate at which such fees and other expenses are claimed.’ ‘CPLR article 86 is in derogation of the common law and therefore should be strictly construed’ (citation omitted). The State EAJA was enacted to ‘improv[e] access to justice for individuals and businesses who may not have the resources to

Copyright © 2018 David L. Ferstendig, All Rights Reserved, Permission Required from Author for electronic or hard copy distribution. sustain a long legal battle against an agency that is acting without justification,’ and was intended to ‘provid[e] recompense for the cost of correcting official error . . . as long as it is limited to helping those who need assistance, it does not deter State agencies from pursuing legitimate goals and it contains adequate restraints on the amount of fees awarded’ (citations omitted). ‘The State EAJA was modeled on the Federal Equal Access to Justice Act and the significant body of case law that has evolved thereunder’ (citations omitted). We conclude that the Supreme Court properly determined that the petitioner was not a ‘prevailing party’ under CPLR 8601(a) and 8602(f), albeit for a different reason. Contrary to the petitioner’s contention, the stipulation entered into between the parties on January 30, 2015, which was so-ordered by the court, did not reflect a material change in the legal relationship between the parties because the petitioner’s claims had already been rendered moot by Kaplan’s voluntary decision on December 30, 2014, to vacate her earlier decision removing the petitioner from the Nursery Program (citations omitted). Furthermore, the petitioner did not achieve prevailing party status by obtaining a temporary restraining order and a preliminary injunction from the court directing the respondents to admit the petitioner to the Nursery Program pending the outcome of the proceeding (citations omitted).”).

RECENT COMMERCIAL DIVISION RULES

David L. Ferstendig, New Commercial Division Rules, 682 N.Y.S.L.D. 3, 4 (2017)

The Commercial Division of the Supreme Court continues to adopt rules designed to streamline and improve the litigation process.

Movant Must Provide Copy of Supporting Motion Papers to Opposing Party When Seeking a Temporary Restraining Order

CPLR 6313 provides that a temporary restraining order may be granted without notice and historically the practice was to issue the restraint ex parte. However, long ago, judges expressed discomfort with issuing a TRO based on the movant’s (biased) word alone, resulting in an adversary’s first knowledge of a pending action when it was served with the TRO. As a result, years ago, Rule 20 of the Rules of the Commercial Division (22 NYCRR § 202.70(g), Rule 20) was adopted, which required the movant to give notice to “the opposing parties to permit them an opportunity to appear and contest the application,” unless the movant can establish that “there will be significant prejudice” if notice is given. What was missing was a requirement that the movant also provide copies of the supporting motion papers to his or her adversary, so that he or she is on notice of the action, can get a real understanding of the issues and provide a meaningful response (opposition) at oral argument of the TRO. Effective July 1, 2017, that gap has been filled.

If Requested, Parties Are to Provide Details as to Length of Trial Rule 26 of the Commercial Division Rules (22 NYCRR § 202.70(g), Rule 26), requires that the parties give the court a “realistic estimate” of the trial length. Effective July 1, 2017, the Rule was amended to provide that at the request of the court, the parties must now include an estimate of the number of hours each party believes it will use for direct examination, cross examination, redirect examination, and argument. The trial court is empowered to rule on the potential number of hours each party will be entitled to, and it can increase the total number of hours “as justice may require.” The trial judge will have the discretion to employ this new procedure. Sample Choice of Forum Provisions Adopted Forum selection clauses can provide certainty and clarity to parties to commercial agreements, as to where and how a commercial dispute will be resolved. These clauses have been held to be presumptively valid by New York courts. See Brooke Group v. JCH Syndicate 488, 87 N.Y.2d 530, 534 (1996). Effective July 1, 2017, a new section § 202.70(d)(2) has been adopted, to aid contracting parties in drafting an appropriate party-specific provision. The amendment provides two alternatives - • a provision in which the parties consent to the exclusive jurisdiction of the Commercial Division, subject to meeting the procedural and monetary or other threshold jurisdictional requirements; or

• one in which the parties consent to the exclusive jurisdiction of the New York federal courts or the Commercial Division, subject to meeting the jurisdictional and procedural requirements of the courts. The amendment supplies the actual language of such provisions, which are intended to be of a “mandatory” nature, as opposed to “permissive” forum selection clauses, which courts may not strictly enforce. See Brooke Group, above. The use of these well-drafted, sample mandatory forum selection clauses enhances their enforceability. As the supporting memorandum notes, contracting parties may wish to provide an alternative venue, in the event the jurisdictional requirements are not met. Parties’ Consultation Prior to Pre-Trial Conference Regarding Expert Testimony A continuing source of tension in New York State courts outside of the Commercial Division is the limited expert disclosure permitted under CPLR 3101(d). Significantly, with limited exception, depositions of experts are not permitted. Back in 2013, Commercial Division Rule 13 was adopted expressly providing for the exchange of experts’ reports and the deposition of testifying experts. This type of disclosure is essential in commercial matters and is similar to practice in the federal courts and most state courts in the country. Effective May 1, 2017, Rule 30(c) was adopted to narrow disagreement among competing experts - The court may direct that prior to the pre-trial conference, counsel for the parties consult in good faith to identify those aspects of their respective experts’ anticipated testimony that are not in dispute. The court may further direct that any agreements reached in this regard shall be reduced to a written stipulation. The rule provides discretion to the trial judge to use this provision as a tool to streamline the trial. The sponsors memorandum notes that by “attempting to narrow disagreement,” this “could well reduce the volume of technical testimony through which the fact finder will be forced to sift, thereby reducing trial time and enhancing efficiencies.” Moreover, by reviewing the experts’ deposition testimony and reports and consulting in good faith “counsel would endeavor to reach agreement with regard to one or more of the opinions being offered. Any agreement reached, which could be memorialized in an appropriate stipulation, would necessarily reduce the amount of expert testimony necessary at trial.”

Additional Commercial Division Rules

• § 202.70(d)(2) was further amended (eff. 1/1/2018) to add a sample choice-of-law provision. See attached.

• A revised New Model Compliance Conference Stipulation and Order Form was issued for “optional use” (eff. 1/1/2018). A form is attached.

• Certification at Preliminary Conference relating to Alternative Dispute Resolution (eff. 1/1/2018): Rule 10. Submission of Information; Certification Relating to Alternative Dispute Resolution At the preliminary conference, counsel shall be prepared to furnish the court with the following: (i) a complete caption, including the index number; (ii) the name, address, telephone number, e-mail address and fax number of all counsel; (iii) the dates the action was commences and issue joined; (iv) a statement as to what motions, if any, are anticipated; and (v) copies of any decisions previously rendered in the case. Counsel for each part shall also submit to the court at the preliminary conference and each subsequent compliance or status conference, and separately serve and file, a statement, in a form prescribed by the Office of Court Administration, certifying that counsel has discussed with the party the availability of alternative dispute resolution mechanisms provided by the Commercial Division and/or private ADR providers, and stating whether the party is presently willing to pursue mediation at some point during litigation.

Rule 11. Discovery (a) The preliminary conference will result in the issuance by the court of a preliminary conference order. Where appropriate, the order will contain specific provisions for means of early disposition of the case, such as (i) directions for submission to the alternative dispute resolution program, including, in all cases in which the parties certify their willingness to pursue mediation pursuant to Rule 10, provision of a specific date by which a mediator shall be identified by the parties for assistance with resolution of the action; (ii) a schedule of limited-issue discovery in aid of early dispositive motions or settlement; and/or (iii) a schedule for dispositive motions before disclosure or after limited-issue disclosure.

• Amendment of Rule 11-e of the Rules of the Commercial Division (22 NYCRR §202.70[g], Rule 11-e), to Address Technology-Assisted Review in Discovery (eff. 10/1/2018):

(f) The parties are encourages to sue the most efficient means to review documents, including electronically stored information (“ESL”), that is consistent with the parties’ disclosure obligations under Article 31 of the CPLR and proportional to the needs of the case. Such means may include technology-assisted review, including predictive coding, in appropriate cases/ the parties are encouraged to confer, at the outset of discovery and as needed throughout the discovery period, about technology-assisted review mechanisms they intend to use in document review and production.