DATE: RE: RECENT CPLR DECISIONS OF INTEREST€¦ · re: recent cplr decisions of interest ... cplr 3211(c) conversion ... recent cplr decisions of interest

LAW OFFICES OF

STROOCK & STROOCK & LAVAN LLP 180 MAIDEN LANE, NEW YORK, NEW YORK 10038-4982

212-806-5400

MEMORANDUM

1 NY 76592344v1

DATE: August 23, 2017

RE: RECENT CPLR DECISIONS OF INTEREST

FROM: Burton N. Lipshie

TABLE OF CONTENTS

JURISDICTION ......................................................................................................... 4

CPLR 301 – GENERAL JURISDICTION ................................................... 4

CPLR 302 – LONG ARM JURISDICTION............................................... 13

JURISDICTION BY CONSENT ................................................................ 21

FORUM NON CONVENIENS ...............................................................................22

GENERAL CONSIDERATIONS ............................................................... 22

FORUM SELECTION CLAUSES ............................................................. 23

VENUE ....................................................................................................................26

SUBJECT MATTER JURISDICTION ...................................................................30

COMMENCING THE ACTION .............................................................................31

THE SUMMONS .....................................................................................................37

SERVICE OF PROCESS ........................................................................................38

WHO MAY SERVE PROCESS ................................................................. 39

WHO MUST BE SERVED WITH PROCESS ........................................... 39

SERVICE ON INDIVIDUALS .................................................................. 39

SERVICE PURSUANT TO THE VEHICLE AND TRAFFIC LAW........ 45

SERVICE IN A FOREIGN COUNTRY .................................................... 45

PROOF OF SERVICE ................................................................................ 46

APPEARANCE BY COUNSEL .............................................................................46

DEFENDANT’S RESPONSE TO BEING SERVED .............................................49

STATUTE OF LIMITATIONS ...............................................................................51

PROFESSIONAL MALPRACTICE .......................................................... 51

MEDICAL MALPRACTICE VS. NEGLIGENCE .................................... 53

THE FOREIGN OBJECT RULE ................................................................ 53

CONTINUOUS TREATMENT .................................................................. 55

PRODUCT LIABILITY.............................................................................. 58

FRAUD ....................................................................................................... 61

BREACH OF CONTRACT ........................................................................ 64

RECENT CPLR DECISIONS OF INTEREST

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WRONGFUL DEATH ................................................................................ 71

INTENTIONAL TORTS ............................................................................ 71

LIABILITY CREATED BY STATUTE .................................................... 72

BREACH OF FIDUCIARY DUTY ............................................................ 73

ACCRUAL AND LIMITATION PERIODS .............................................. 74

CONTRACTUAL LIMITATIONS PERIODS ........................................... 76

ACKNOWLEDGEMENT AND PART PAYMENT ................................. 76

ESTOPPEL .................................................................................................. 79

THE RELATION BACK DOCTRINE ....................................................... 80

DEFENDANTS “UNITED IN INTEREST” .............................................. 82

TOLLS GENERALLY................................................................................ 84

THE “INSANITY” TOLL........................................................................... 85

THE “DEATH” TOLL ................................................................................ 86

CPLR 205(A) .............................................................................................. 86

THE BORROWING STATUTE ................................................................. 89

CONDITIONS PRECEDENT .................................................................... 90

PARTIES TO AN ACTION ....................................................................................90

JOINDER .................................................................................................... 90

CONSOLIDATION AND SEVERANCE .................................................. 91

ADDITION OF PARTIES .......................................................................... 92

SUBSTITUTION OF PARTIES ................................................................. 93

INTERVENTION ....................................................................................... 95

INTERPLEADER ....................................................................................... 96

CLASS ACTIONS ...................................................................................... 96

UNKNOWN PARTIES ............................................................................... 99

ARTICLE 16 ............................................................................................... 99

INDEMNIFICATION AND CONTRIBUTION ...................................... 101

GENERAL OBLIGATIONS LAW §15-108 ............................................ 104

PLEADINGS .........................................................................................................104

MOTION PRACTICE ...........................................................................................111

MOTION PROCEDURE .......................................................................... 111

RENEWAL, REARGUMENT AND RESETTLEMENT ........................ 116

SEALING THE FILE ............................................................................................120

SANCTIONS .........................................................................................................121

CONTEMPT ............................................................................................. 121

OTHER SANCTIONS .............................................................................. 125

SEALING OF COURT FILES ..............................................................................127

STAYING AN ACTION .......................................................................................127

PROVISIONAL REMEDIES ................................................................................128

ATTACHMENT ....................................................................................... 128

PRELIMINARY INJUNCTION ............................................................... 129


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NOTICE OF PENDENCY ........................................................................ 131

ACCELERATED JUDGMENT ............................................................................132

CPLR 3211 ................................................................................................ 132

TIMING OF MOTIONS FOR SUMMARY JUDGMENT ...................... 141

SUMMARY JUDGMENT ........................................................................ 146

CPLR 3213 ................................................................................................ 150

CPLR 3211(C) CONVERSION ................................................................ 152

DEFAULTS ............................................................................................... 152

OBTAINING A DEFAULT JUDGMENT ..................................................... 152

VACATING A DEFAULT ......................................................................... 155

CPLR 3216 ................................................................................................ 159

JUDGMENT BY CONFESSION ............................................................. 162

OFFER TO COMPROMISE OR LIQUIDATE DAMAGES ................... 162

VOLUNTARY DISCONTINUANCE ...................................................... 163

BILL OF PARTICULARS ....................................................................................164

DISCLOSURE .......................................................................................................164

MOTION PRACTICE ............................................................................... 164

SCOPE OF DISCLOSURE ....................................................................... 164

INFORMAL DISCOVERY ...................................................................... 165

PRE-ACTION DISCLOSURE ................................................................. 166

NON-PARTY DISCLOSURE .................................................................. 167

EXPERT DISCLOSURE .......................................................................... 167

PRIVILEGES ............................................................................................ 170

IN GENERAL ......................................................................................... 170

ATTORNEY-CLIENT PRIVILEGE............................................................. 171

ATTORNEY WORK PRODUCT ................................................................ 172

MATERIAL CREATED FOR LITIGATION ................................................. 174

THE COMMON INTEREST “PRIVILEGE” ................................................. 174

OTHER PRIVILEGES .............................................................................. 177

PRIVILEGE LOGS .................................................................................. 181

DEPOSITIONS ......................................................................................... 181

PRODUCTION OF DOCUMENTS ......................................................... 183

DISCLOSURE OF SOCIAL MEDIA ....................................................... 185

SURVEILLANCE VIDEOS ..................................................................... 186

SPOLIATION ........................................................................................... 187

ELECTRONIC DISCLOSURE ................................................................ 192

MEDICAL RECORDS AND EXAMINATIONS .................................... 196

ENFORCING DISCLOSURE ORDERS.................................................. 201

STIPULATIONS AND SETTLEMENT ...............................................................206

PRE-TRIAL PROCEEDINGS...............................................................................207

TRIAL AND JUDGMENT ....................................................................................209


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JURY ISSUES ........................................................................................... 209

VERDICTS ............................................................................................... 210

INTEREST ................................................................................................ 211

POWERS OF REFEREES ........................................................................ 212

JUDGMENTS ........................................................................................... 213

ARTICLE 78 PROCEEDINGS .............................................................................213

GENERAL CONSIDERATIONS ............................................................. 213

STATUTE OF LIMITATIONS ................................................................ 215

ARBITRATION .....................................................................................................217

ARBITRABILITY .................................................................................... 218

ARBITRATION AGREEMENTS ............................................................ 219

CPLR VS. FEDERAL ARBITRATION ACT .......................................... 219

WAIVER OF ARBITRATION ................................................................. 220

COMPELLING OR CHALLENGING ARBITRATION ......................... 220

CONFIRMING OR VACATING THE AWARD .................................... 222

ENFORCEMENT OF JUDGMENTS ...................................................................225

* * * * *

JURISDICTION

CPLR 301 – GENERAL JURISDICTION

Waldman v. Palestine Liberation Organization, 2016 WL 4537369 (2d Cir. 2016) –A

prior year’s “Update” reported on the Supreme Court’s landmark decision in Daimler AG

v. Bauman, ___ U.S. ___, 134 S.Ct. 746 (2014). In Daimler, almost certainly its most

important jurisdiction decision in some 70 years, an eight-Justice majority of the

Supreme Court essentially rewrote the law of general jurisdiction. The result is that a

corporation will, with narrow exceptions, only be subject to general jurisdiction in the

States in which it is either incorporated or maintains its principal place of business; in the

Court’s language, a State in which the corporation is “at home.” The once familiar

standard for general jurisdiction – corporate “presence” in a State in which it “does

business” both “continuously and systematically” – has been abrogated, except, possibly,

in “exceptional” cases. The Court issued a sweeping opinion on the constitutional limits

of “presence jurisdiction,” and, in the process, swept away decades of New York CPLR

301 jurisprudence. First, the Court rejected the argument, accepted and followed by

many Circuits [see, Gelfand v. Tanner, 385 F.2d 116 (2d Cir. 1967)(regularly cited and

followed by New York courts)], that when a local agent performs services for the foreign

principal that are so important that “if it did not have a representative to perform them,

the corporation’s own officials would undertake to perform substantially similar


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services,” the presence of the agent in the state makes the principal present in that state.

That test, said the Court, “stacks the deck,” because “it will always yield a pro-

jurisdiction answer.” Instead, the Court relied heavily on – and expanded upon – its

decision in Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915 (2011),

saying that “Goodyear made clear that only a limited set of affiliations with a forum will

render a defendant amenable to all-purpose jurisdiction there. ‘For an individual, the

paradigm forum for the exercise of general jurisdiction is the individual’s domicile; for a

corporation, it is an equivalent place, one in which the corporation is fairly regarded as at

home’” [emphasis added]. And, for a corporation, “the place of incorporation and

principal place of business are ‘paradigm bases for general jurisdiction.’” The Court

recognized that “Goodyear did not hold that a corporation may be subject to general

jurisdiction only in a forum where it is incorporated or has its principal place of business;

it simply typed those places paradigm all-purpose forums” [emphasis by the Court].

Here, “plaintiffs would have us look beyond the exemplar bases Goodyear identified, and

approve the exercise of general jurisdiction in every State in which a corporation

‘engages in a substantial, continuous, and systematic course of business’ [citation

omitted]. That formulation, we hold, is unacceptably grasping.” This marks a dramatic

change in the law. In New York, the formulation proposed by the Daimler plaintiffs had

been the law since Judge Cardozo’s 1917 opinion in Tauza v. Susquehanna Coal

Company, 220 N Y 259 (1917). The majority opinion cites Tauza, and proclaims that it

was “decided in the era dominated by Pennoyer [v. Neff, 95 U.S. 714 (1878)]’s territorial

thinking,” and “should not attract heavy reliance today.” The new standard articulated by

the Court is that the inquiry “is not whether a foreign corporation’s in-forum contacts can

be said to be in some sense ‘continuous and systematic,’ it is whether that corporation’s

‘affiliations with the State are so “continuous and systematic” as to render it essentially at

home in the forum State.’” The Court acknowledges “the possibility that in an

exceptional case [citation omitted; emphasis added], a corporation’s operations in a

forum other than its formal place of incorporation or principal place of business may be

so substantial and of such a nature as to render the corporation at home in that State. But

this case presents no occasion to explore that question, because Daimler’s activities in

California plainly do not approach that level. It is one thing to hold a corporation

answerable for operations in the forum State [citation omitted], quite another to expose it

to suit on claims having no connection whatever to the forum State.” Finally, the Court

held that “the general jurisdiction inquiry does not ‘focus solely on the magnitude of the

defendant’s in-state contacts’ [citation omitted]. General jurisdiction instead calls for an

appraisal of a corporation’s activities in their entirety, nationwide and worldwide. A

corporation that operates in many places can scarcely be deemed at home in all of them.

Otherwise, ‘at home’ would be synonymous with ‘doing business’ tests framed before

specific jurisdiction evolved in the United States [citation omitted]. Nothing in

International Shoe [Co. v. Washington, 326 U.S. 310 (1945)] and its progeny suggests

that ‘a particular quantum of local activity’ should give a State authority over a ‘far larger


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quantum of activity’ having no connection to any in-state activity.” Here, in Waldman,

American plaintiffs sue the Palestine Liberation Organization, the Palestinian Authority,

and others, on claims under the federal Anti-Terrorism Act, for injury and wrongful death

to them and their decedents resulting from terrorist attacks in Israel. Reversing the

District Court, the Second Circuit rules that the Courts of the United States lack general

jurisdiction over the defendants. “The overwhelming evidence shows that the defendants

are ‘at home’ in Palestine, where they govern. Palestine is the central seat of government

for the PA and PLO. The PA’s authority is limited to the West Bank and Gaza, and it has

no independently operated offices anywhere else. All PA governmental ministries, the

Palestinian president, the Parliament, and the Palestinian security services reside in

Palestine.” Within the United States, “the activities of the defendants’ mission in

Washington, D.C. – which the district court concluded simultaneously served as an office

for the PLO and the PA [citation omitted] – were limited to maintaining an office in

Washington, promoting the Palestinian cause in speeches and media appearances, and

retaining a lobbying firm [citation omitted]. These contacts with the United States do not

render the PA and the PLO ‘essentially at home’ in the United States.” And their

commercial contacts here were such as the Daimler Court held it would be “unacceptably

grasping” to support general jurisdiction. Moreover, “the district court also erred in

placing the burden on the defendants to prove that there exists an alternative forum where

Plaintiffs’ claims could be brought, and where the foreign court could grant a

substantially similar remedy [citation omitted]. Daimler imposes no such burden. In

fact, it is the plaintiff’s burden to establish that the court has personal jurisdiction over the

defendants.”

BNSF Railway Co. v. Tyrrell, ___ U.S. ___, 137 S.Ct. 1549 (2017) – “BNSF has over

2,000 miles of railroad track [6% of its total] and more than 2,000 employees [5% of its

total] in Montana [in which it generates less than 10% of its total revenue]. But, as we

observed in Daimler, ‘the general jurisdiction inquiry does not focus solely on the

magnitude of the defendant’s in-state contacts’ [citation omitted]. 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’ [citation

omitted]. 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.” Justice Sotomayor

continued “to disagree with the path the Court struck in Daimler.”

Amtrust North America, Inc. v. Preferred Contractors Insurance Company Risk Retention

Group, LLC, 2016 WL 6208288 (S.D.N.Y. 2016)(McMahon, J.) – “This Court would

likely have personal jurisdiction over [defendant] PCIC under CPLR 301. The

uncontroverted facts asserted in Plaintiffs’ brief are that PCIC has a wide range of


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contacts with New York. PCIC advertises, through its agent Safebuilt, insurance

programs in New York and collects millions of dollars in premiums from New York

insureds [citation omitted]. PCIC is a registered risk retention group under New York

insurance law [citation omitted]. It has designated the Department of Financial Services

as its agent for service of process [citation omitted]. It has previously participated in

litigation before this Court without asserting a personal jurisdiction defense [citations

omitted]. These contacts are sufficiently ‘continuous and systematic’ as to render PCIC

essentially at home in New York [citing Daimler]. PCIC has availed itself of this Court’s

jurisdiction on previous occasions without objection and has again done so here.”

Cragnotti and Partners Capital Investment-Brazil S.A. v. Quintella, N.Y.L.J.,

1202781884008 (Sup.Ct. N.Y.Co. 2017)(Scarpulla, J.) – The Court here rejects, as have

various Federal Courts, the holding in In re Hellas Telecommunications (Luxembourg) II

SCA, 524 B.R. 488 (Bankr. S.D.N.Y. 2015), that “very substantial corporate operations

(regardless of whether measured in money, personnel, space, or time) in a given forum

suffice to make a defendant at home in the forum.”

Fernandez v. DaimlerChrysler, AG, 143 A D 3d 765 (2d Dept. 2016) – “‘A foreign

corporation is amenable to suit in New York courts under CPLR 301 if it has engaged in

such a continuous and systematic course of doing business here that a finding of its

presence in this jurisdiction is warranted’ [citations omitted]. Any exercise of

jurisdiction over a foreign corporation on the basis of state law must comport with the

due process requirement that ‘the corporation’s “affiliations with the State in which suit

is brought are so constant and pervasive as to render it essentially at home in the forum

State”’ [citations omitted]. Here, in opposition to Daimler’s motion to dismiss the

complaint insofar as asserted against it, the plaintiff failed to establish, prima facie, that

the activities of Daimler in New York subjected it to the personal jurisdiction of the

Supreme Court pursuant to CPLR 301.”

Minnie Rose LLC v. Yu, 2016 WL 1049020 (S.D.N.Y. 2016)(Ramos, J.) – As other

Courts have done [see, Beem v. Noble Group Limited, 2015 WL 8781333 (S.D.N.Y.

2015), reported on in last year’s “Update”], the Court here conflates the standards for

general jurisdiction over corporations that existed before Daimler swept them away, with

the new standard enunciated in Daimler. First, the Court applied Daimler to the

individual defendant, finding that, because that defendant is not domiciled in New York,

“there is no basis for the Court to exercise general jurisdiction over her.” Then, turning

to the corporate defendant, the Court held that, “a foreign corporation is subject to a

court’s general jurisdiction when its affiliations with the forum State are ‘so “continuous

and systematic” as to render it essentially at home’ there [citing Daimler]. The classic,

but not exclusive, bases of general jurisdiction are a corporation’s place of incorporation

and principal place of business, which ‘have the virtue of being unique – that is, each

ordinarily indicates only one place – as well as easily ascertainable’ [again citing


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Daimler]. Additional indicia of a corporation’s presence in the forum include whether

the corporation: (1) has employees, agents, offices, bank accounts, or property within the

state; (2) is authorized to do business in the state; (3) has a phone listing in the state; (4)

does public relations work in the state; (5) pays state income or property taxes; and (6)

the volume of business it conducts with state residents [citing a Southern District case

decided 11 years before Daimler].”

Ace Decade Holdings Ltd. v. UBS AG, N.Y.L.J., 1202774437526 (Sup.Ct. N.Y.Co. 2016)

(Bransten, J.) – “Since Daimler, New York courts have recognized that ‘doing business’

in New York is no longer a constitutionally sufficient basis for the exercise of general

jurisdiction over foreign entities.”

Famular v. Whirlpool Corporation, 2017 WL 280821 (S.D.N.Y. 2017)(Briccetti, J.) –

Last year’s “Update” reported on Matter of B&M Kingstone, LLC v. Mega International

Commercial Bank Co., Ltd., 131 A D 3d 259 (1st Dept. 2015). There, in its attempt to

enforce a judgment, petitioner sought information from respondent bank, headquartered

in Taiwan, by service of an information subpoena on its New York branch. The

Appellate Division, First Department, directed enforcement of the subpoena with respect

to accounts held in any of the bank’s branches. “Mega’s New York branch is subject to

jurisdiction requiring it to comply with the appropriate information subpoenas, because it

consented to the necessary regulatory oversight in return for permission to operate in

New York.” But last year’s “Update” also reported on the decision in Brown v. Lockheed

Martin Corp., 2016 WL 641392 (2d Cir. 2016). There, the Second Circuit concluded

that the relevant Connecticut statute for registration of foreign corporations and the

designation of an agent for service of process there – which may be the Secretary of State

– is “ambiguous” and not “clear enough” as to whether such registration constitutes,

under Connecticut law, a “consent” to jurisdiction there. Accordingly, the Court did not

need to “raise constitutional questions prudently avoided absent a clearer statement by the

state legislature or the Connecticut Supreme Court.” However, in pretty powerful dicta,

the Court strongly suggested that it would view a clearer statute, like New York’s, which

“has been definitively construed to accomplish that end,” as violating due process as

interpreted by the Supreme Court in Daimler. For, “the analysis that now governs

general jurisdiction over foreign corporations – the Supreme Court’s analysis having

moved from the ‘minimum contacts’ review described in International Shoe to the more

demanding ‘essentially at home’ test enunciated in Goodyear and Daimler – suggests that

federal due process rights likely constrain an interpretation that transforms a run-of-the-

mill registration and appointment statute into a corporate ‘consent’ – perhaps unwitting –

to the exercise of general jurisdiction by state courts, particularly in circumstances where

the State’s interests seem limited.” And, “it appears that every state in the union – and

the District of Columbia, as well – has enacted a business registration statute [citation

omitted]. States have long endeavored to protect their citizens and levy taxes, among

other goals, through this mechanism. If mere registration and the accompanying


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appointment of an in-state agent – without an express consent to general jurisdiction –

nonetheless sufficed to confer general jurisdiction by implicit consent every corporation

would be subject to general jurisdiction in every state in which it registered, and

Daimler’s ruling would be robbed of meaning by a back-door thief. In Daimler, the

Court rejected the idea that a corporation was subject to general jurisdiction in every state

in which it conducted substantial business. Brown’s interpretation of the Connecticut

statute could justify the exercise of general jurisdiction over a corporation in a state in

which the corporation had done no business at all, so long as it had registered” [emphasis

by the Court]. Here, in Famular, the Court confronted these opposing positions.

“Despite the uncertain status of the law in this area, a foreign defendant is not subject to

the general personal jurisdiction of the forum state merely by registering to do business

with the state, whether that be through a theory of consent by registration or otherwise.

‘After Daimler, with the Second Circuit cautioning against adopting “an overly expansive

view of general jurisdiction,” the mere fact of defendant being registered to do business is

insufficient to confer general jurisdiction in a state that is neither its state of incorporation

nor its principal place of business.’”

Ortiz v. Great Eastern Resort Corp., N.Y.L.J., 1202753684544 (Sup.Ct. Bronx Co. 2016)

(Gonzalez, J.) – “Jurisdiction over a foreign corporation may thus be asserted only where

there is an affiliation with the State that is so ‘continuous and systematic as to render it

essentially at home in the forum State’ [citing Daimler]. This high bar is clearly not

satisfied by Resort Management’s corporate registration with the NY Secretary of State.”

Bonkowski v. HP Hood LLC, 2016 WL 4536868 (S.D.N.Y. 2016)(Mauskopf, J.) –

“While courts have held that a corporation has constructively consented to personal

jurisdiction where it is authorized to do business in New York state [citations omitted],

they have done so prior to Daimler. And cases post-Daimler that have considered the

continued viability of consent to jurisdiction through registration have done so without

analysis, relying on the long-standing, pre-Daimler Appellate Division authority

[citations omitted]. The New York Court of Appeals has not defined the scope of New

York’s business registration statutes and its impact on personal jurisdiction either pre- or

post-Daimler, and this Court declines to so do. In Brown v. Lockheed Martin Corp.

[discussed directly above], the Second Circuit found it ‘prudent – in the absence of a

controlling interpretation by the Connecticut Supreme Court, or a clearer legislative

mandate than Connecticut law now provides – to decline to construe the state’s

registration and agent-appointment statutes as embodying actual consent by every

registered corporation to the state’s exercise of general jurisdiction over it’ [citation

omitted]. Finding neither controlling case law nor a scintilla of discussion on this point

from either party, the Court declines to give New York’s statutory scheme such an

expansive reading.”


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Genuine Parts Company v. Cepec, 2016 WL 1569077 (Del. 2016) – The Supreme Court

of Delaware weighs in on the issue whether registering to do business in a State amounts

to a consent to general jurisdiction there. Overruling one of its pre-Daimler cases, the

Court interprets its statute, which, like New York’s, provides for the designation of a

State official as agent for service of process upon becoming authorized to do business, as

not “a broad consent to personal jurisdiction in any cause of action, however unrelated to

the foreign corporation’s activities in Delaware.” After Daimler, “it is not tenable to read

Delaware’s registration statutes” to constitute such consent. For, “an incentive scheme

where every state can claim general jurisdiction over every business that does any

business within its borders for any claim would reduce the certainty of the law and

subject businesses to capricious litigation treatment as a cost of operating on a national

scale or entering any state’s market. Daimler makes plain that it is inconsistent with

principles of due process to exercise general jurisdiction over a foreign corporation that is

not ‘essentially at home’ in a state for claims having no rational connection to the state.”

In re Foreign Exchange Benchmark Rates Antitrust Litigation, 2016 WL 1268267

(S.D.N.Y. 2016)(Schofield, J.) – “Plaintiffs argue that the New Defendants constructively

consented to personal jurisdiction in this matter pursuant to §200 of the New York

Banking Law, which requires a foreign banking corporation, among other things, to

‘appoint the superintendent [of the New York Department of Financial Services] and his

or her successors its true and lawful attorney, upon whom all process in any action or

proceeding against it on a cause of action arising out of a transaction with its New York

agency or agencies or branch or branches, may be served’ [citation omitted]. This

argument is incorrect. By the terms of the statute, any consent to jurisdiction by virtue of

the New Defendants’ registration with the NYDFS is not general jurisdiction over all

claims, but instead is limited to claims arising out of transactions with the New

Defendants’ New York agencies or branches.”

Serov v. Kerzner International Resorts, Inc., N.Y.L.J., 1202764623785 (Sup.Ct. N.Y.Co.

2016)(Edmead, J.) – “It has been held that ‘a foreign corporation is deemed to have

consented to personal jurisdiction over it when it registers to do business in New York

and appoints the Secretary of State to receive process for it pursuant to Business

Corporation Law §§304 and 1304’ [citations omitted]. This is ‘part of the bargain by

which the foreign corporation enjoys the business freedom of the State of New York’

[citation omitted]. As such, Defendants’ initial contention that the Court lacks general

jurisdiction over them because they were not engaged in a ‘continuous and systematic

course of doing business’ in New York [citation omitted], is misplaced; analysis of the

nature and frequency of a defendant’s business is not required where the defendant has

registered to do business in New York and appointed the Secretary of State, as its

registered agent, to accept service on their behalf. Therefore, as Kerzner North America

and Kerzner NY were both, at the time this action was commenced, authorized to do

business in New York and appointed the Secretary of State as its registered agent to


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accept service on their behalf, they consented to be subject to the general jurisdiction of

New York courts. And, contrary to Defendants’ contention, the due process rights of

Kerzner North America and Kerzner NY are not violated through the exercise of such

jurisdiction. By taking the affirmative step of registering to do business in New York,

those defendants availed themselves of the benefits of being able to do business here.

Those benefits are accompanied by the reasonable expectation that they could be hailed

into New York courts.”

Mischel v. Safe Haven Enterprises, LLC, N.Y.L.J., 1202787244868 (Sup.Ct. N.Y.Co.

2017)(Coin, J.) – The Court here disagrees with the decision in Serov v. Kerzner

International Resorts, discussed directly above. In Serov, “the court, relying on pre-

Daimler case law, found consent to jurisdiction by the defendant’s having registered to

do business in New York. While discussing Daimler generally, the Serov court ‘did not

discuss the impact of Daimler on the viability of predicating general jurisdiction on

consent through the business-registration statutes.’” The Court here concludes that

registration is not sufficient to make a foreign corporation subject to general jurisdiction.

“All 50 states require registration of foreign corporations to do business [citation

omitted]. If, after Daimler, these statutes were deemed to meet due process standards,

foreign corporations seeking to avoid general jurisdiction in a state would be faced with

unenviable choices: (1) not doing business in the state; (2) registering and subjecting

themselves to general jurisdiction; or (3) doing business in the state without registration

and thereby breaking the law.” The Court finds that “the net effect of finding jurisdiction

by registration would be coercive.” Moreover, “the New York registration statute (BCL

§304), while designating the secretary of state as the registrant’s agent for service of

process, is silent on the jurisdictional effect of registering to do business here. In

apparent recognition of this omission, a bill was introduced in the State Assembly to

make plain that registration constituted consent to the general jurisdiction of the courts of

this state [citation omitted]. The proposed statute was not enacted.”

FIA Leveraged Fund Ltd. v. Grant Thornton LLP, 150 A D 3d 492 (1st Dept. 2017) –

Three decades before the Daimler decision, The Second Circuit, in Volkswagenwerk AG

v. Beech Aircraft Corporation, 751 F.2d 117 (2d Cir. 1984), laid out a four-prong test for

determining whether the presence in New York of a subsidiary of a non-New York

corporation sufficed to provide general jurisdiction here over the parent corporation: (1)

common ownership; (2) financial dependence of the subsidiary on the parent; (3)

assignment by the parent of executive personnel of the subsidiary, and failure to observe

corporate formalities; (4) parental control over the subsidiary’s marketing and operational

policies. Post-Daimler, that holding is at least called into question, since the non-New

York parent is not “at home” in New York. But, here, in FIA Leveraged Fund Ltd, the

Court declined jurisdiction over the non-New York parent corporation because “plaintiffs

failed to satisfy the four factors set out in Volkswagenwerk AG v. Beech Aircraft Corp.

[citation omitted], which we have adopted.”


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Singh v. Singh, 2016 WL 3181149 (S.D.N.Y. 2016)(Carter, J.) – Although Daimler dealt

with a state’s general jurisdiction over corporations, the Court stated that “‘for an

individual, the paradigm forum for the exercise of general jurisdiction is the individual’s

domicile.’” A prior year’s “Update” reported on Hardware v. Ardowork Corporation,

117 A D 3d 561 (1st Dept. 2014), where, in a decision dated four months after Daimler,

the Court, without discussing, or even citing, Daimler, held the individual third-party

defendant to be subject to general jurisdiction in New York because he was “‘doing

business’ in New York, through a voluntary, continuous and self-benefitting course of

conduct, sufficient to render him subject to the general jurisdiction of this State’s courts

[citations, including Bryant v. Finnish National Airline, 15 N Y 2d 426 (1965), which re-

affirmed the decision in Tauza, which the Supreme Court apparently overruled in

Daimler, omitted]. The evidence included, among other things, Mr. Hardware’s

testimony concerning his long-term employment as a scientist at an ‘undisclosed

location’ in New York, and documentary evidence presented by third-party plaintiffs

showing that he also had a long-term business relationship with a New York company,

for which he acted as a designated agent.” Similarly, that year’s “Update” reported on

the Second Department’s decision in Pichardo v. Zayas, 122 A D 3d 699 (2d Dept.

2014), where, in a decision issued ten months after Daimler, the Court held that the

individual defendants were not subject to general jurisdiction in New York, not because

of the restrictions imposed by Daimler, which it did not cite, but because of the Second

Department’s prior decisions interpreting CPLR 301 as not including general jurisdiction

over individuals based upon “doing business” in New York. The Court included a “but

see” cite to the Hardware decision. Eventually, in Magdalena v. Lins, 123 A D 3d 600

(1st Dept. 2014), also reported on in that year’s “Update,” the First Department, citing

Daimler, held that there was no basis for general jurisdiction over an individual defendant

because, “while Lins, a Brazilian national, owns an apartment in New York, he is not

domiciled there.” And, again, in Hopeman v. Hopeman, 128 A D 3d 488 (1st Dept.

2015), also in that year’s “Update,” the First Department held that the defendant was not

subject to general jurisdiction in New York because “there was no evidence that he had

established ‘physical presence in the State and an intention to make the State a permanent

home.’” Yet, as reported in last year’s “Update,” the Southern District, in Pinto-Thomaz

v. Cusi, 2015 WL 7571833 (S.D.N.Y. 2015), citing and quoting from Hardware, and

various pre-Daimler cases, and without citing Daimler, stated that, “traditionally, CPLR

301 has allowed New York courts to exercise general personal jurisdiction over

individuals only if they are domiciled in New York, have a physical presence in New

York, or consent to New York’s exercise of jurisdiction [citations omitted]. At times,

however, New York courts have exercised general personal jurisdiction over individuals

‘doing business’ in the state, a mode of analysis historically applied only to foreign

corporations [citations omitted]. Like the New York Court of Appeals in Laufer [v.

Ostrow, 55 N Y 2d 305 (1982)], for the purposes of this motion, this Court assumes,

without deciding, that an individual ‘doing business’ in New York may be subject to


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general jurisdiction. This requires the plaintiff to make a prima facie showing that the

defendant is ‘doing business’ in New York through evidence of ‘a voluntary, continuous

and self-benefitting course of conduct.’” Here, in Singh, the Court described the indicia

of a defendant’s domicile in a forum: “for instance that Defendant holds a New York

State driver’s license, maintains personal and business checking and credit card accounts

at New York banks, files New York State tax returns, lists New York on tax returns as his

home address, or owns any property in New York.”

Reich v. Lopez, 858 F.3d 55 (2d Cir. 2017) – “Owning property in a forum does not alone

establish domicile. ‘One may have more than one residence in different parts of this

country or the world, but a person may have only one domicile’ [citation omitted]. In an

‘exceptional case,’ an individual’s contacts with a forum might be so extensive as to

support general jurisdiction notwithstanding domicile elsewhere [citing Daimler], but the

Second Circuit has yet to find such a case.” And, “this is not a case in which we need to

decide the question of whether it would ever be possible to exercise general jurisdiction

over an individual in a forum other than the one in which he is domiciled, nor do we need

to define the exact contours of what could make such an ‘exceptional case’ [citation

omitted]. Betancourt, a Venezuelan citizen, has relationships with New York banks and

law firms, and owns an apartment in New York; but he spent fewer than 5% of nights in

New York during a 31-month period the district court examined. Trebbau, also a

Venezuelan citizen, does not own or rent any property in New York. In the same 31-

month period, he spent fewer than 3% of nights in New York. The defendants’ contacts

with New York do not approach the point at which general jurisdiction over them would

comport with due process.”

Chen v. Lu, 144 A D 3d 735 (2d Dept. 2016) – Almost three years after Daimler, the

Court does not cite that seminal Supreme Court decision, but, instead, relies upon its own

35 year-old precedent in holding that, under CPLR 301, “‘the bases for jurisdiction [over

individuals] recognized by our common law before the date of the enactment of the

CPLR were physical presence within the State, domicile or consent.’” And, here,

“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.’”

CPLR 302 – LONG ARM JURISDICTION

Bristol-Myers Squibb Co. v. Superior Court of California, ___ U.S. ___, 137 S.Ct. 1773

(2017) – Non-California plaintiffs sued, in California, the manufacturer of a drug they

claimed caused them harm in their home states, joining several California residents who

made the same claim. The Supreme Court rejects the “sliding scale approach to specific

jurisdiction.” “Under this approach, ‘the more wide-ranging the defendant’s forum

contacts, the more readily is shown a connection between the forum contacts and the

claim.’” Here, the California Supreme Court “concluded that ‘BMS’s extensive contacts


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with California’ permitted the exercise of specific jurisdiction ‘based on a less direct

connection between BMS’s forum activities and plaintiffs’ claims than might otherwise

be required.’” And, ‘this attenuated requirement was met, the majority found, because

the claims of the nonresidents were similar in several ways to the claims of the California

residents (as to which specific jurisdiction was uncontested).” But, under long arm

jurisdiction, “‘the suit’ must ‘arise out of or relate to the defendant’s contacts with the

forum’ [citations omitted; emphasis by the Court]. In other words, there must be ‘an

affiliation between the forum and the underlying controversy, principally, an activity or

an occurrence that takes place in the forum State and is therefore subject to the State’s

regulation’ [citation omitted]. For this reason, ‘specific jurisdiction is confined to

adjudication of issues deriving from, or connected with, the very controversy that

establishes jurisdiction.” Thus, “the California Supreme Court’s ‘sliding scale approach’

is difficult to square with our 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.” And, “the mere fact that other plaintiffs were prescribed,

obtained, and ingested Plavix in California – and allegedly sustained the same injuries as

did the nonresidents – does not allow the State to assert specific jurisdiction over the

nonresidents’ claims.” Justice Sotomayor dissented. “Three years ago, the Court

imposed substantial curbs on the exercise of general jurisdiction in its decision in

Daimler [citation omitted]. Today, the Court takes its first step toward a similar

contraction of specific jurisdiction by holding that a corporation that engages in a

nationwide course of conduct cannot be held accountable in a state court by a group of

injured people unless all of those people were injured in the forum State. I fear the

consequences of the Court’s decision today will be substantial. The majority’s rule will

make it difficult to aggregate the claims of plaintiffs across the country whose claims

may be worth little alone. It will make it impossible to bring a nationwide mass action in

state court against defendants who are ‘at home’ in different States. And it will result in

piecemeal litigation and the bifurcation of claims. None of this is necessary. A core

concern in this Court’s personal jurisdiction cases is fairness. And there is nothing unfair

about subjecting a massive corporation to suit in a State for a nationwide course of

conduct that injures both forum residents and nonresidents alike.”

Chen v. Lu, 144 A D 3d 735 (2d Dept. 2016) – “Pursuant to CPLR 302(a)(1), the court

may exercise personal jurisdiction over a nondomiciliary who ‘transacts any business

within the state or contracts anywhere to supply goods or services in the state.’ The

transaction of business is established where it is shown that a ‘defendant’s activities here

were purposeful and there is a substantial relationship between the transaction and the

claim asserted.’” And “a single transaction in New York may suffice to invoke

jurisdiction even if the defendant never enters the state, provided that the activity was


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purposeful and ‘there is a substantial relationship between the transaction and the claim

asserted’ [citations omitted]. Indeed, absent ‘some articulable nexus’ between a

defendant’s purposeful business activities in the state and the plaintiff’s claims, personal

jurisdiction pursuant to CPLR 302(a)(1) may not be exercised.”

First Manhattan Energy Corporation v. Meyer, 150 A D 3d 521 (1st Dept. 2017) –

“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 ‘changing 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.”

Nick v. Schneider, 150 A D 3d 1250 (2d Dept. 2017) – In this action for fraud, plaintiffs

adequately demonstrated that their cause of action arises out of the Florida-domiciled

defendant’s transaction of business in New York. “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 [his co-defendant] to use the investment money deposited in the

escrow account for personal expenses.”


1202781884008 (Sup.Ct. N.Y.Co. 2017)(Scarpulla, J.) – “The ‘mere solicitation by

defendant of business within the state does not constitute the transaction of business

within the state unless the solicitation in New York is supplemented by business

transactions occurring in the state’ [citation omitted]. Additionally, the ‘publication of

information on a globally-accessible website does not constitute the “transaction of

business” in New York unless the website specifically targets its activities at New York’

[citation omitted]. In fact, ‘passive websites which merely impart information without

permitting a business transaction, are generally insufficient to establish personal

jurisdiction.’” And, as here, even if a website is interactive, its mere existence is

insufficient for long arm jurisdiction where “there is no allegation that [plaintiff]

specifically used the [defendant’s] website to purchase the Bonds” at issue.

America/International 1994 Venture v. Mau, 146 A D 3d 40 (2d Dept. 2016) – In this

action on an unpaid note issued in connection with an investment agreement, “the

question presented on this appeal is whether New York has jurisdiction over an Illinois


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resident who entered into an agreement to invest in a New York joint venture. As

relevant to this appeal, the agreement appointed a corporation that has its principal office

in New York to act as an agent on behalf of all of the investors with respect to the

business of the joint venture. For the reasons set forth herein, we find that the agreement,

which gave investors no right to control the activities of the corporation appointed as

agent, cannot serve as a basis for the exercise of long-arm jurisdiction.” For, “to be

considered an agent for jurisdictional purposes, the local agent must have ‘engaged in

purposeful activities in the State in relation to a transaction for the benefit of and with the

knowledge and consent of the defendant and that the defendant exercised some control

over the agent in the matter.” Indeed, “the critical factor is the degree of control the

defendant principal exercises over the agent.” And, here, “the critical element of control

is completely lacking.” For, “the Subscription Agreement provided that Kraft [the agent]

had the ‘full power and authority,’ ‘without further consent and without limitation of any

power or authority,’ to act on the defendant’s behalf with regard to the operation of the

joint venture. Moreover, while a principal is ordinarily ‘always free to terminate the

agency relationship’ [citation omitted], here, the Subscription Agreement did not provide

the defendant the right to terminate Kraft as his agent and provided that only a majority

of the investors could revoke Kraft’s power of attorney.” Finally, jurisdiction pursuant to

CPLR 302 requires “the existence of some articulable nexus between the business

transacted and the cause of action sued upon.” Here, “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 [to which Kraft “was a stranger”] 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.”

Coast to Coast Energy, Inc. v. Gasarch, 149 A D 3d 485 (1st Dept. 2017) – “To establish

that a defendant acted through an agent, a plaintiff must ‘convince the court that the New

York actors engaged in purposeful activities in this State in relation to the transaction for

the benefit of and with the knowledge and consent of the defendant and that the

defendant exercised some control over the New York actors’ [citation omitted]. ‘To

make a prima facie showing of control, “a plaintiff’s allegations must sufficiently detail

the defendant’s conduct so as to persuade a court that the defendant was a primary actor”

in the specific matter in question; control cannot be shown based merely upon a

defendant’s title or position within the corporation, or upon conclusory allegations that

the defendant controls the corporation.’”

Ace Decade Holdings Ltd. v. UBS AG, N.Y.L.J., 1202774437526 (Sup.Ct. N.Y.Co. 2016)

(Bransten, J.) – Plaintiff “cannot manufacture jurisdiction over UBS by moving its

operations to New York.” The bulk of the transaction between the parties occurred while

plaintiff operated out of Hong Kong. The minimal contacts after its relocation to New

York did not suffice to create CPLR 302(a)(1) jurisdiction over defendant.


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Rushaid v. Pictet & Cie, 28 N Y 3d 316 (2016) – Last year’s “Update” reported on the

Appellate Division decision in this action [127 A D 3d 610 (1st Dept. 2015)]. Plaintiff

claims that defendant Swiss bank assisted faithless employees in a kickback scheme by

effecting wire transfers on their behalf. The Appellate Division held that, “unlike the

Lebanese Canadian Bank (LCD) [over which jurisdiction was sustained in Licci v.

Lebanese Canadian Bank, SAL, 20 N Y 3d 327 (2012)], however, which was alleged to

have ‘deliberately used a New York account again and again to effect its support’ of a

foundation through which money was funneled to a terrorist organization [citation

omitted], defendants are alleged to have been ‘directed’ by plaintiffs’ former employees

‘to wire the bribe/kickback money to Citibank NA, New York, in favor of Pictet & Co.

Bankers Geneva, for the credit of’ an account they controlled. Thus, unlike LCD,

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.’”

A narrowly-divided Court of Appeals has reversed. The majority concludes that

“defendants’ intentional and repeated use of New York correspondent bank accounts to

launder their customers’ illegally obtained funds constitutes purposeful transaction of

business substantially related to plaintiffs’ claims, thus conferring personal jurisdiction

within the meaning of CPLR 302(a)(1).” The majority relied upon its Licci decision, and

distinguished Amigo Foods Corp. v. Marine Midland Bank-NY, 39 N Y 2d 391 (1976) –

in which it held that the mere existence of a foreign bank’s correspondent account in New

York was, in itself, insufficient to impose jurisdiction over that bank. For, “unintended

and unapproved use of a correspondent bank account, where the non-domiciliary bank is

a passive and unilateral recipient of funds later rejected – as in Amigo Foods – does not

constitute purposeful availment for personal jurisdiction under CPLR 302(a)(1).

Repeated, deliberate use that is approved by the foreign bank on behalf and for the

benefit of a customer – as in Licci – demonstrate volitional activity constituting

transaction of business. In other words, the quantity and quality of a foreign bank’s

contacts with the correspondent bank must demonstrate more than banking by

happenstance.” And, here, the complaint alleged that defendant Pictet’s “Citibank, New

York [correspondent] account was used to wire the bribes to a Pictet account in Geneva,

after which point, the money was divided up and distributed amongst the ‘corrupted

employees’ by deposit to their individual Pictet accounts. [Pictet’s Vice President]

Chambaz knew the large sums of money being wired were proceeds of an illegal scheme

but never questioned them, and continued to aid and abet the fraud.” Thus, “the

Appellate Division erroneously concluded that plaintiffs failed to establish purposeful

availment because defendants ‘merely carried out their clients’ instructions.’ Our cases

do not require that the foreign bank itself direct the deposits, only that the bank

affirmatively act on them.” And, “a foreign bank with a correspondent account,

therefore, that repeatedly approves deposits and the movement of funds through the

account for the benefit of its customer is no less ‘transacting business in New York’

because the customer, or a third party at the customer’s direction, actually deposits or


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transfers the funds to New York.” The dissent argued that “CPLR 302(a)(1) does not

confer personal jurisdiction over a foreign bank when, as in this case, the bank’s only

connection to New York is the maintenance of a New York correspondent account and

the passive receipt of payments into that account, at the unilateral direction of third

parties.” Rather, “a foreign entity must initiate purposeful contact with New York,

beyond the mere maintenance of a correspondent account, in order for its relationship

with a New York bank to form the basis for the exercise of personal jurisdiction.” And,

here, the dissent urged, “defendants’ sole connection to New York was the maintenance

of a correspondent account at Citibank, N.A., into which third party vendors deposited

funds that were alleged to be the proceeds of bribes and kickbacks obtained by foreign

‘corrupt employees’ in connection with a Saudi Arabian construction project,” and

“plaintiffs have not identified any volitional act on the part of defendants that was

directed at New York. Indeed, the only intentional conduct alleged in the complaint that

relates in any way to New York was carried out by the foreign employees – who directed

the vendors to wire the bribes and kickbacks to ‘Citibank, N.A., New York, in favour of

“Pictet and Co. Bankers Geneva,” for the credit of’ the employees’ overseas account –

and the vendors, who followed that direction.”

D&R Global Selections, S.L. v. Bodega Olegario Falcon Pineiro, 29 N Y 3d 292 (2017)

– Defendant, a Spanish winery, entered into a contract, in Spain, with plaintiff, a Spanish

business broker, agreeing that if plaintiff located a distributor to import defendant’s wine

into the United States, defendant would pay commissions on wine sales made to such

distributor. Thereafter, both parties came to New York several times to meet potential

distributors. On one such trip, to attend a showcase of Spanish wines, plaintiff

introduced defendant to a New York wine importer, and defendant began selling wine to

that importer. Thereafter, plaintiff and defendant twice came to New York to events that

featured the importer’s Spanish wine portfolio, including defendant’s wine.

Subsequently, the parties had a dispute about the terms of their agreement, and plaintiff

commenced this action in New York. The Court of Appeals unanimously concludes that

defendant is subject to jurisdiction in New York pursuant to CPLR 302(a)(1). Defendant

transacted business in New York, and, “plaintiff’s claim arises from” that transaction.

The “arises from” inquiry is “‘relatively permissive’ and an articulable nexus or

substantial relationship exists ‘where at least one element arises from the New York

contacts’ rather than ‘every element of the cause of action pleaded’ [citation omitted].

The nexus is insufficient where the relationship between the claim and transaction is ‘too

attenuated’ or ‘merely coincidental.’” And, here, “plaintiff’s claim has a substantial

relationship to defendant’s business activities in New York. 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.


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Those sales to Kobrand – and the unpaid commissions thereon – are at the heart of

plaintiff’s claim.”

People ex rel. Schneiderman v. Orbital Publishing Group, Inc., 50 Misc 3d 811 (Sup.Ct.

N.Y.Co. 2015)(Edmead, J.) – “Respondents argue that all of Pugsley’s contacts with New

York were conducted in her corporate capacity and do not confer jurisdiction over her as

an individual. Additionally, respondents argue that Pugsley owns no property in New

York and she has never been in it. However, New York has rejected the ‘fiduciary shield

doctrine’ [citations omitted]. Thus, Pugsley may not avoid jurisdiction because she was

working as an officer of Adept while accruing contacts with New York. This is

especially true since Pugsley enjoyed almost total control over Adept as its owner,

president and principal laborer [citation omitted]. Since Pugsley herself conducted all of

the activity ascribed to Adept in the petition, and as any benefit that accrued to Adept

also accrued to Pugsley, she is subject to jurisdiction in New York for the same reasons

that Adept is.”

Bloomgarden v. Lanza, 143 A D 3d 850 (2d Dept. 2016) – In this legal malpractice

action, the New York plaintiffs sue California attorneys with regard to defendants’

representation of plaintiffs in a Florida lawsuit. The Court concludes that New York

lacks jurisdiction over defendants. First, as to CPLR 302(a)(1), “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 concerned the services that the defendants were performing in

Florida.” And, as to CPLR 302(a)(3), “the residence of an injured party in New York is

not sufficient to satisfy the clear statutory requirement of an ‘injury within the state’

[citations omitted]. ‘The situs of the injury is the location of the original event which

caused the injury, not the location where the resultant damages are subsequently felt by

the plaintiff’ [citation omitted]. Here, the alleged legal malpractice occurred in Florida.”

Lantau Holdings, Ltd. v. Orient Equal International Group, 2017 WL 914636 (Sup.Ct.

N.Y.Co. 2017)(Singh, J.) – “CPLR 302(a)(2) has been narrowly construed to apply only

when the defendant’s wrongful conduct is performed in New York” [emphasis by the

Court]. Here, “plaintiff claims that the tortious statements were made to New York by

Haitong’s emails and calls to them. Most of the New York courts have refused to apply

CPLR 302(a)(2) to claims based on tortious statements that made their way to New York

only by mail or telephone.” Moreover, “Haitong does not have its own affiliation with

New York outside of the alleged emails and phone calls made to Lantau. Accordingly, ‘it

would offend “minimum contacts” due process principles to force defendants to litigate

this claim in a New York forum on the basis of telephone calls or virtual emails.’”


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Waldman v. Palestine Liberation Organization, 2016 WL 4537369 (2d Cir. 2016) – A

prior year’s “Update” reported on Walden v. Fiore, ___ U.S. ___, 134 S.Ct. 1115 (2014),

in which a unanimous Supreme Court curtailed the reach of long arm jurisdiction when

the cause of action arises from tortious conduct that has taken place outside of the forum

state. “For a State to exercise jurisdiction consistent with due process, the defendant’s

suit-related conduct must create a substantial connection with the forum State.” Thus,

“the relationship must arise out of contacts that the ‘defendant himself’ creates with the

forum State” [emphasis by the Court]. And, “our ‘minimum contacts’ analysis looks to

the defendant’s contacts with the forum State itself, not the defendant’s contacts with

persons who reside there.” Accordingly, “the plaintiff cannot be the only link between

the defendant and the forum. Rather, it is the defendant’s conduct that must form the

necessary connection with the forum State that is the basis for its jurisdiction over him.”

For “due process requires that a defendant be haled into court in a forum State based on

his own affiliation with the State, not based on the ‘random, fortuitous, or attenuated’

contacts he makes by interacting with other persons affiliated with the State.” The Court

rejected the argument that defendant’s “knowledge” of plaintiffs’ “strong forum

connections” sufficed. For that approach “impermissibly allows a plaintiff’s contacts

with the defendant and forum to drive the jurisdictional analysis. Such reasoning

improperly attributes a plaintiff’s forum connections to the defendant and makes those

connections ‘decisive’ in the jurisdictional analysis.” In sum, “mere injury to a forum

resident is not a sufficient connection to the forum. Regardless of where a plaintiff lives

or works, an injury is jurisdictionally relevant only insofar as it shows that the defendant

has formed a contact with the forum State. The proper question is not where the plaintiff

experienced a particular injury or effect but whether the defendant’s conduct connects

him to the forum in a meaningful way.” The full reach of the Walden decision will

naturally have to await further case law development. But it will certainly have some

impact on the New York Courts’ interpretation of CPLR 302(a)(3)(ii). That statute

provides for long arm jurisdiction over a defendant who commits a tort outside of New

York, causing injury in New York, when the defendant should expect or reasonably

expect the conduct to have consequences here, and when defendant derives substantial

revenue from interstate or international (but not necessarily New York-related)

commerce. If jurisdiction were to be based solely upon a defendant knowing that its out-

of-state conduct might injure a New Yorker, it would, it appears, violate due process as

articulated in Walden. Last year’s “Update” reported on In re LIBOR-Based Financial

Instruments Antitrust Litigation, 2015 WL 4634541 (S.D.N.Y. 2015), in which the Court

held that “there is no basis to infer that issuers of broadly-traded securities such as bonds

and MBS purposely directed those securities into plaintiffs’ home forums. These

securities may arrive in the hands of plaintiffs and other investors anywhere in the world

by the investors’ own trades – not at the direction of the issuers. Such a fortuitous,

plaintiff-driven contact cannot support personal jurisdiction [citing Walden].” Here, in

Waldman, American plaintiffs sue the Palestine Liberation Organization, the Palestinian


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Authority, and others, on claims under the federal Anti-Terrorism Act, for injury and

wrongful death to them and their decedents resulting from terrorist attacks in Israel. The

Court holds that a United States court lacks long arm jurisdiction over defendants. For,

“the defendants were liable for tortious activities that occurred outside the United States

and affected United States citizens only because they were victims of indiscriminate

violence that occurred abroad. The residence or citizenship of the plaintiffs is an

insufficient basis for specific jurisdiction over the defendants. A focus on the

relationship of the defendants, the forum, and the defendants’ suit-related conduct points

to the conclusion that there is no specific personal jurisdiction over the defendants for the

torts in this case.” And, “the mere knowledge that United States citizens might be

wronged in a foreign country goes beyond the jurisdiction limit set forth in Walden.

Delfasco, LLC v. Powell, 52 Misc 3d 689 (Sup.Ct. Kings Co. 2016)(Ash, J.) – The New

York-based plaintiff sues its Tennessee-based employee, claiming he “sabotaged” the

plaintiff’s business and downloaded and stole trade secrets and other confidential

information. That information was housed on plaintiff’s Brooklyn, New York, server.

The Court concludes that “the locus of the tort is in Tennessee, not New York.

Delfasco’s allegations against Powell solely concern his conduct as a Delfasco employee

in Tennessee and the information he was privy to as a high-level manager at Delfasco’s

manufacturing plant.” Thus, “Powell’s alleged misappropriation of information,

technically stored on Delfasco’s New York servers, is insufficient to submit him to New

York’s jurisdiction. Powell’s only connection to New York is through his employment

with Delfasco. This does not satisfy the ‘minimum contacts’ analysis set forth in

International Shoe Co. v. Washington [citation omitted]. ‘A plaintiff cannot be the only

link between the defendant and the forum’ [citing, inter alia, Walden]. ‘Rather, it is the

defendant’s conduct that must form the necessary connection with the forum State that is

the basis for its jurisdiction over him.’”

McBride v. KPMG International, 135 A D 3d 576 (1st Dept. 2016) – “The motion court

correctly found that New York lacks personal jurisdiction over KPMG UK pursuant to

CPLR 302(a)(3)(ii). While plaintiffs allege that KPMG UK committed a tort outside the

state (negligently auditing nonparty Madoff Securities International, Ltd in the United

Kingdom), and their causes of action arise out of that tort, KPMG UK’s act did not cause

injury to a person or property within the state. ‘The situs of commercial injury is where

the original critical events associated with the action or dispute took place, not where any

financial loss or damages occurred.’”

JURISDICTION BY CONSENT

Oak Rock Financial, LLC v. Rodriguez, 148 A D 3d 1036 (2d Dept. 2017) – The law in

New York is that “‘a party may agree by contract to submit to jurisdiction in a given

forum and that such a forum selection clause, when it is part of the contract that forms the

basis of the action, will be enforced, obviating the need for a separate analysis of the


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propriety of exercising personal jurisdiction.’” Here, the underlying agreement provided

that “Borrower consents to the jurisdiction of any State or Federal Court located within

the State of New York.” And, “although the guaranty executed by the defendant does not

contain a similar provision, generally, ‘documents executed at about the same time and

covering the same subject matter are to be interpreted together, even if one does not

incorporate the terms of the other by reference, and even if they are not executed on the

same date, so long as they are “substantially” contemporaneous.’”

Matter of Hereford Insurance Co. v. American Independent Insurance, 136 A D 3d 551

(1st Dept. 2016) – The Appellate Division finds that jurisdiction is lacking over

respondent in this proceeding to confirm an arbitration award. “The motion court erred

in concluding that it had personal jurisdiction over respondent simply because the

arbitration occurred in New York and respondent never contested the arbitrator’s

jurisdiction. Respondent, a Pennsylvania corporation that had insured the offending

vehicle, has no contacts with New York, and the offending vehicle was neither registered

in New York nor owned by a New York resident.”

FORUM NON CONVENIENS

GENERAL CONSIDERATIONS


1202781884008 (Sup.Ct. N.Y.Co. 2017)(Scarpulla, J.) – “The ‘domicile or residence in

this state of any party to the action shall not preclude the court from staying or dismissing

the action.’ The applicability of the forum non conveniens doctrine ‘is a matter of

discretion to be exercised by the trial court and the Appellate Division’ [citation omitted].

In making a forum non conveniens determination, courts should consider several factors

including the burden on New York courts, any potential hardship to the defendant, the

unavailability of an alternative forum for the plaintiff’s suit, if both parties are

nonresidents and whether the transaction that gave rise to the cause of action primarily

took place in a foreign jurisdiction.”

Landmark Ventures, Inc. v. Birger, 147 A D 3d 497 (1st Dept. 2017) – “Plaintiff contents

that it should be allowed to litigate its breach of contract claim in New York because the

[parties’ agreement] chooses New York law. However, a choice of law clause is different

from a choice of forum clause” [emphasis by the Court].

Johnson v. Vernon, N.Y.L.J., 1202771682765 (Sup.Ct. N.Y.Co. 2016)(Ramirez, J.) – The

action arises out of a bus accident in New Jersey. Plaintiff, a New York resident, was

solicited by defendant, a New Jersey company, for a bus trip to Atlantic City. Defendants

picked up plaintiff, and other New York residents in New York, and the accident


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occurred during the return trip to New York. Defendants’ motion to dismiss on forum

non conveniens grounds is denied, as “defendants did not meet their burden of

demonstrating that the balance of factors favors disturbing plaintiff’s choice of forum.”

First, “although residence of a plaintiff is not the sole determining factor on a motion for

dismissal on grounds of forum non conveniens, it has been held to generally be ‘the most

significant factor in the equation.’” Moreover, “the majority of the passengers on the

bus, who are potential witnesses, are New York residents,” and “the majority of

plaintiff’s medical treatment stemming from the subject accident was done in New York.

Finally, “retention of this case will not pose an unacceptable burden” on defendants or

the Court. Defendants “can seek the deposition and trial testimonies of any potential

witness that resides in New Jersey pursuant to the Uniform Interstate Deposition and

Discovery Act, which is codified in New Jersey under NJ Court Rule 4:11-4 and in New

York under CPLR 3119.”

FORUM SELECTION CLAUSES

Hemlock Semiconductor Pte, Ltd. v. Jinglong Industry and Commerce Group Co., Ltd.,

56 Misc 3d 324 (Sup.Ct. N.Y.Co. 2017)(Oing, J.) – The parties’ agreement provided for

the application of New York law to any dispute, and for the “exclusive jurisdiction” of

New York State or Federal Courts. The Court rejects defendant’s argument that General

Obligations Law §5-1401, which provides that parties “may agree that the law of this

state shall govern their rights and duties in whole or in part, whether or not such * * *

agreement * * * bears a reasonable relation to this state,” violates the Commerce Clause

or the Due Process Clause of the United States Constitution.

Carlyle CIM Agent, L.L.C. v. Trey Resources, Inc., 148 A D 3d 562 (1st Dept. 2017) –

The agreement between the parties had a forum selection clause that was permissive as to

plaintiff, but “required defendants to commence any cause of action against plaintiff

exclusively in the state of federal courts of New York County.” Plaintiff commenced this

action in New York on the notes that were the subject matter of the agreement, and a

separate action in Oklahoma “seeking to preserve its collateral represented in oil and gas

assets and real property” located there. Defendant counterclaimed in the Oklahoma

action, and moved to dismiss this action pursuant to CPLR 3211(a)(4). The Appellate

Division reverses the granting of that motion. “There is no merit to defendants’ argument

that the forum selection clauses did not pertain to counterclaims brought in another

venue. This is because there is no distinction between a claim and a counterclaim, the

latter of which ‘is itself a cause of action.’” Defendants “contractually agreed not to file

any claim outside of New York County, and doing so was a defined breach under the

clear terms of the mandatory forum selection clauses. Thus, absent plaintiff’s consent, it

is therefore improper to dismiss the New York actions pursuant to CPLR 3211(a)(4) so as

to consolidate them with the Oklahoma proceedings.” Dismissal was also improper by

virtue of General Obligations Law §5-1402, “which provides that any party may maintain


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an action in New York State courts where there is a contractual agreement providing for a

choice of New York law and forum, and the case involves at least $1 million, all of which

occur here [citation omitted]. Under this statute, a New York court may not decline

jurisdiction even if ‘the only nexus is the contractual agreement’ [citations omitted]. The

purpose of General Obligations Law §5-1402 is to enhance New York as ‘one of the

world’s major financial and commercial Centers,’ by ‘encouraging the parties to

significant commercial, mercantile or financial contracts to choose New York law’ and

forum.”

Siroy v. Jobson Healthcare Information LLC, N.Y.L.J., 1202759000736 (Sup.Ct.

N.Y.Co. 2016)(Cohen, J.) – Plaintiff’s employment agreement with defendant Jobson

contained an exclusive forum selection clause for any action “arising out of or related to

this agreement” to be brought in the federal or state courts in New Jersey. Plaintiff

commenced this action in New York, claiming unlawful harassment based upon race and

gender, against both Jobson and her supervisor, Levitz. The Court, in granting the

motion to dismiss, holds that Levitz, as well as Jobson, may invoke the forum selection

clause. “It is well established that a nonsignatory may invoke a forum selection clause if

the relationship between the nonparty and the signatory is sufficiently close so that the

nonparty’s enforcement of the forum selection clause is foreseeable by virtue of the

relationship between the nonparty and the party sought to be bound.” And, here, “Levitz

is being sued for an action taken as plaintiff’s supervisor, a position he held while

employed by JHI. The cause of action against Levitz for employment discrimination

cannot be brought against him in his personal capacity but only emanates from his

employment and position as plaintiff’s supervisor. Similarly, JHI’s liability flows from

Levitz’ actions towards plaintiff as JHI’s employee. Levitz is ‘closely related’ to JHI, the

signatory to the agreement.”

Lantau Holdings, Ltd. v. Orient Equal International Group, 2017 WL 914636 (Sup.Ct.

N.Y.Co. 2017)(Singh, J.) – “First, an entity or individual that is a third-party beneficiary

of the agreement may enforce a forum selection clause found within the agreement

[citation omitted]. Second, parties to a global transaction who are not ‘signatories to a

specific agreement within that transaction may nonetheless benefit from a forum

selection clause contained in such agreement if the agreements are executed at the same

time, by the same parties or for the same purpose’ [citation omitted]. Third, a non-

signatory that is closely related to one of the signatories can enforce a forum selection

clause [citation omitted]. A non-signatory is considered closely related to one of the

signatories and can enforce a forum selection clause when the enforcement of the clause

is ‘foreseeable by virtue of the relationship between them’ [citation omitted]. The non-

signatory defendant must have a ‘sufficiently close relationship with the signatory and the

dispute to which the forum selection clause applied.’” But “when a non-signatory has no

relationship to the underlying transaction, they cannot be held to be ‘closely related’ nor

subjected to the forum selection clause.”


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GE Oil & Gas, Inc. v. Turbine Generation Services, L.L.C., N.Y.L.J., 1202759552482

(Sup.Ct. N.Y.Co. 2016)(Kornreich, J.) – “Courts in New York have long recognized the

propriety and importance of issuing antisuit injunctions where a parallel action in a

foreign court is being prosecuted in contravention of a New York forum selection clause

and where such parallel action undermines the integrity of the court’s judgments

[citations omitted]. In the First Department, ‘the use of injunctive relief to enforce a

forum selection clause has been upheld as a proper exercise of discretion.’” And,

“where, as here, ‘once there is a New York judgment on the merits, the courts of this

State are entitled to protect it’ by issuing an anti-suit injunction to prohibit ‘defendant’s

harassing and bad faith foreign litigation.’” For, “the court cannot allow the integrity of

its judgment to be challenged. Litigants, such as the extremely sophisticated parties

(aided by extremely sophisticated counsel) in this action, expressly agreed to litigate in

New York and apply New York law to their complex commercial disputes because this

court is seen as capable of providing a level of certainty not found in other jurisdictions.”

Gautier v. Bay Park Center for Nursing and Rehabilitation LLC, N.Y.L.J.,

1202753627226 (Sup.Ct. Nassau Co. 2016)(Brown, J.) – Defendant moves to change the

venue of this personal injury action, commenced in Bronx County, to Nassau County,

pursuant to a forum selection clause contained in the “Admission Agreement” signed by

plaintiff’s deceased. In opposing the motion, plaintiff asserts that her age and infirmities

preclude her leaving the Bronx, where she resides, for a trial in Nassau. She included an

affirmation from her physician, listing her many disabilities and illness, and opining “that

travel outside the Bronx would cause undue physical and mental stress to Mrs. Gautier

and aggravate her already serious conditions.” The Court noted that “‘a contractual

forum selection clause is prima facie valid and enforceable unless it is shown by the

challenging party to be unreasonable, unjust, in contravention of public policy, invalid

due to fraud or overreaching, or it is shown that a trial in the selected forum would be so

gravely difficult that the challenging party would, for all practical purposes, be deprived

of its day in court.’” Here, “the main issue” is “whether the selected forum would be so

‘gravely difficult’ that the challenging party would, for all practical purposes, be deprived

of its day in court.” The Court concludes that it would not. “It is hard for the court to

accept that plaintiff would be able to travel to a courthouse or any location within Bronx

County but once she crossed over the county line, it would cause undue physical and

mental stress to plaintiff, or that it would be impossible for plaintiff to find alternate

transportation to Nassau County. Any such opinion is speculation on the physician’s

part.”

Prospect Funding Holdings, L.L.C. v. Maslowski, 146 A D 3d 535 (1st Dept. 2017) –

Plaintiff, a New York litigation finance company, with its principal place of business in

Minnesota, seeks to enjoin defendant, its client, and a Minnesota resident, who was

injured in an automobile accident in Minnesota, from litigating her claims against

plaintiff in Minnesota. Plaintiff relies upon a New York choice of forum clause


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contained in the parties’ agreement. The Appellate Division reverses the granting of that

injunction. “‘In the interest of substantial justice,’ the parties’ dispute should be heard in

Minnesota [citations omitted]. Ms. Maslowski demonstrated that the choice of forum

provision in the parties’ agreement is unreasonable and should not be enforced [citations

omitted]. Every aspect of the transaction at issue occurred in Minnesota, the parties,

documents, and witnesses are located in Minnesota, and defending this action in New

York would be a substantial hardship to Ms. Maslowski.”

Merchant Cash & Capital, LLC v. Blueshyft, Inc., N.Y.L.J., 1202784005227 (Sup.Ct.

Nassau Co. 2017)(Feinman, J.) – The agreement between the parties provides that any

lawsuit arising from the agreement “shall be brought in any state court of competent

jurisdiction in the State of New York, or in any federal court of competent jurisdiction in

the State of New York.” The Court rejects defendants’ claim that the clause is an

improper “floating forum selection clause.” The cases dealing with such a “floating”

clause are those in which “the agreement provided that the parties agreed to be sued not

only in any state where the plaintiff had a principal office, but also in any state where any

future unidentified assignee of the agreement had a principal office.” Here, “the forum

selection clause is clear and specific and designates New York courts.”

VENUE

FB v. JL, N.Y.L.J., 1202775607416 (Sup.Ct. N.Y.Co. 2016)(Helewitz, Sp.Ref.) – A

Court may not change venue sua sponte. But, where a Court has done so, the receiving

Court “lacks the authority” to reverse that order and send the matter back to the original

venue. Thus, if both parties are content with the transfer, and none appeals from the

transfer order, the receiving Court must take the case.

Merchant Cash and Capital, L.L.C. v. Laulainen, 55 Misc 3d 349 (Sup.Ct. Nassau Co.

2017)(Diamond, J.) – The agreement between the parties provided that “either the state or

federal courts in New York shall have jurisdiction over any dispute” between them.

Plaintiff is a foreign corporation, authorized to do business in New York, with its

principal place of business in New York County. Defendant is a foreign corporation with

no connections to New York. The Court grants defendant’s motion to change venue from

Nassau County to New York County. The choice of forum clause in the agreement “does

not specify that venue will be placed in Nassau County specifically. Thus, while the

waiver provision of this section addresses such claims that a court in the State of New

York is inconvenient and that such dispute should be brought in a court located in another

state, the parties have not be agreement done away with the requirements of CPLR 503

entirely.” On these facts, Nassau County is not a proper county, and the action is

transferred.


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Merchant Cash and Capital, LLC v. Portland Wholesale Jewelry, LLC, N.Y.L.J.,

1202795385358 (Sup.Ct. Nassau Co. 2017)(McCormack, J.) – The Court here

distinguishes Merchant Cash and Capital, L.L.C. v. Laulainen, reported on directly

above. Here, the agreement between the parties also provided for exclusive jurisdiction

in New York, but further provided that “Seller and Guarantor(s) waive any claim that the

venue of the action is improper.” Thus, the venue chosen by plaintiff is upheld, “absent

proof it was unjust, unreasonable, violated public policy or was ‘gravely’ inconvenient.”

Gleitman v. Silver Gate Owners Corp., 139 A D 3d 671 (2d Dept. 2016) – CPLR 507

provides that “the place of trial of an action in which the judgment demanded would

affect the title to, or the possession, use or enjoyment of, real property shall be in the

county in which any part of the subject of the action is situated.” This is an action “to

recover damages for wrongful eviction, conversion, and trespass, and for a judgment

declaring that the current board of directors of the defendant Silver Gate Owners Corp. is

not legally constituted.” Such an action does not come within CPLR 507, and Supreme

Court erred in changing venue to the county where the property is located.

Crovato v. H&M Hennes & Mauritz, L.P., 140 A D 3d 490 (1st Dept. 2016) – “Although

a person may have more than one residence, for venue purposes, there must be evidence

that the plaintiff actually resided at the claimed residence at the time the action was

commenced [citation omitted]. An ownership interest in property does not alone

demonstrate residence at that property.”

Fish v. Davis, 146 A D 3d 485 (1st Dept. 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]. 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 [citation 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.”

Fergile v. Payne, 147 A D 3d 727 (2d Dept. 2017) – “The plaintiff commenced this

action against the County of Nassau, among others, in the Supreme Court, Queens

County. The defendants moved to change the venue of the action from Queens County to

Nassau County pursuant to CPLR 504(1), which provides that the place of trial of all

actions against a county shall be in such county. The Supreme Court properly granted the

motion. Although venue may be placed in a county other than the county mandated by

CPLR 504 upon a showing of special or compelling countervailing circumstances


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[citations omitted], the plaintiff failed to demonstrate the existence of such circumstances

in opposition to the motion.”

Crucen v. Pepsi-Cola Bottling Company of New York, Inc., 139 A D 3d 538 (1st Dept.

2016) – “Defendant’s designation of New York County as its principal place of business

in the application for authority [to do business filed with the Secretary of State] is

controlling for venue purposes [citations omitted]. Contrary to plaintiff’s arguments,

even if defendant does not actually have an office in New York County, and although it

has notified the Department of State to forward process to an address in Bronx County,

the designation made by defendant in its application for authority still controls for venue

purposes.”

Astarita v. ACME Bus Corp., 55 Misc 3d 767 (Sup.Ct. Nassau Co. 2017) (Libert, J.) –

“For nearly 160 years the county designated in certificate of incorporation was the

exclusive determinant of ‘residence’ of that corporation irrespective of any subsequent

physical relocation of corporate offices.” But the Court, relying upon the dissenting

opinion of the closely-divided First Department in Discolo v. River Gas & Wash Corp.,

41 A D 3d 126 (1st Dept. 2007), holds that the enactment of Business Corporation Law

§408 has abrogated that rule. For, under that provision, every New York corporation, and

every foreign corporation authorized to do business in New York, must regularly file “a

statement setting forth: (a) the name and business address of its chief executive officer,

and (b) the street address of its principal executive office.” The Court concludes that the

current address that must be provided under BCL §408 supersedes the address set forth in

the certificate of incorporation, and therefore provides a basis for venue.

Arduino v. Molina-Ovando, 141 A D 3d 622 (2d Dept. 2016) – Plaintiff was injured in an

automobile accident that occurred in Richmond County. She commenced two separate

personal injury actions: first against the owner and driver of the other car in Kings

County, the second against the City of New York in Richmond County. She then sought

to consolidate the actions in Kings County. The City did not oppose, but the other

defendants did. “The general rule that a consolidated action is typically litigated in the

county where the first action was commenced must yield to the venue-specific rule that

an action against the City of New York shall be brought in the county within the city in

which the cause of action arose [citations omitted]. Here, the Supreme Court should have

placed venue of the consolidated action in Kings County, since that is where the first

action was commenced. Even though the plaintiff alleged that the cause of action arose

in Richmond County, the City waived its right to the continuation of venue in Richmond

County upon consolidation of the two actions by its failure to oppose the plaintiff’s

motion [citation omitted]. Furthermore, while the Molina defendants sought placement

of venue in Richmond County under CPLR 504(3), their argument should have been

rejected, since only the City may invoke this statute.”


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Schwartz v. Walter, 141 A D 3d 641 (2d Dept. 2016) – Citing, inter alia, its seminal

decision in O’Brien v. Vassar Brothers Hospital, 207 A D 2d 169 (2d Dept. 1995), the

Court holds that “a party moving to change the venue pursuant to CPLR 510(3) must

provide information about the prospective witnesses, including, but not limited to, their

names and addresses, disclose the facts about which the proposed witnesses will testify at

the trial, represent that the prospective witnesses are willing to testify, and state that the

witnesses would be inconvenienced if the venue is not changed [citations omitted].

However, these criteria should not be applied with ‘absolute rigidity or inexorability.’”

And, while in prior decisions, the First Department had adopted the reasoning and

holding of the Second Department’s decision in O’Brien, which had rejected a line of

cases holding that, “all things being equal,” a transitory cause of action should be tried

where the cause of action arose, and, instead, interpreted CPLR 510 as imposing a burden

on defendant to demonstrate the four elements described above, last year’s “Update”

reported on Wickman v. Pyramid Crossgates Company, 127 A D 3d 530 (1st Dept. 2015),

where, citing cases that pre-date O’Brien, and its own adoption of the O’Brien standards

[see, for example, Argano v. Scuderi, 2 A D 3d 177 (1st Dept. 2003); Jacobs v. Banks

Shapiro Gettlinger & Brennan, LLP, 9 A D 3d 299 (1st Dept. 2004); Rosen v. Uptown

General Contracting, Inc., 72 A D 3d 619 (1st Dept. 2010)], the First Department held

that “the situs of plaintiff’s injury provides a basis for a discretionary change of venue to

Albany County [citation omitted] in that, ‘things being equal, a transitory action should

be tried in the county where the cause of action arose.’” It then, however, proceeds to

discuss the proof of convenience shown by defendants.

Great American Insurance Company of New York v. CNY Excavating and Concrete,

LLC, N.Y.L.J., 1202770540895 (Sup.Ct. N.Y.Co. 2016)(Mendez, J.) – Citing O’Brien v.

Vassar Brothers Hospital, discussed directly above, the Court holds that “in order to

demonstrate its entitlement to relief pursuant to CPLR 510(3), the movant must provide

an affidavit in support establishing: (1) the names, addresses, and occupations of the

prospective witnesses; (2) the facts to which the proposed witnesses will testify at trial,

allowing the court to determine whether the proposed witness is necessary and material;

(3) that the proposed witnesses are in fact willing to testify; and (4) how the witnesses

would in fact be inconvenienced if a change of venue were not granted.” Here,

“defendant has not established a basis for change of venue. Defendant fails to set forth

how the witnesses would be inconvenienced if venue was not changed. Defendant only

provides the conclusory assertion that it is a four hour drive into New York County [from

Oneida County, where the conduct regarding this litigation occurred and some witnesses

reside] and that it would necessitate an overnight stay. Further, Defendant has not stated

whether the proposed witnesses are in fact willing to testify, and only asserts that the

police officer and Defendant’s appraiser are ‘expected’ to testify. A failure of the

Defendant to show that the witnesses have been contacted, how they would be

inconvenienced, and whether they are even willing to testify warrants denial of a change

of venue motion [citation omitted]. Lastly, the Defendant’s and the dump truck driver’s


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convenience is not a deciding factor as a party or a party’s employee’s location is not a

‘weighty factor’ in considering a motion for a discretionary change of venue.”

Palma v. Burgos, 147 A D 3d 426 (1st Dept. 2017) – “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 [v. Peppertree Hill Development Corp., 49 A D 2d 721

(1st Dept. 1975)], 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.”

SUBJECT MATTER JURISDICTION

Caputo v. Koenig, 147 A D 3d 649 (1st Dept. 2017) – The Appellate Division here

reverses Supreme Court’s dismissal of plaintiffs’ claim under the federal Fair Debt

Collection Practices Act [15 USC §1692 et seq.], on the ground that the Court lacked

subject matter jurisdiction over the federal claim. “Given the presumption of concurrent

state court jurisdiction over federal claims [citation omitted], the FDCP’s expansive

expression of jurisdiction to include not only the Federal District courts, but ‘any other

court of competent jurisdiction’ [citation omitted], and the lack of any explicit statutory

directive to the contrary, an unmistakable implication from legislative history, or clear

incompatibility between State court jurisdiction and Federal interests [citation omitted],

the court improperly dismissed plaintiffs’ FDCPA claim.”

Jackson v. State of New York, 139 A D 3d 1293 (3d Dept. 2016) – “‘While jurisdiction

reposes in the Court of Claims where the essential nature of the claim against defendant

is to recover money, it does not lie where monetary relief is incidental to the primary

claim’ [citations omitted]. Here, we agree with the Court of Claims that it lacks subject

matter jurisdiction on claimant’s false imprisonment claim, inasmuch as his primary

argument is that he is currently being confined unlawfully due to errors in resentencing

and that any claim for related damages is incidental to this primary argument.”

Cocchi v. State of New York, 52 Misc 3d 561 (Ct. of Claims 2016)(Marin, J.) – Plaintiff

has commenced two separate actions arising out of an automobile accident: one against

the State in the Court of Claims, and one against the driver of the other car, and the City

of New York, in Supreme Court. The Court denies the motion of the Supreme Court

defendants to consolidate the actions. “The motivation to do so is understandable: it is

essentially what underlies the long-standing calls in this state for the merger of its trial


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courts – which would require amendment to the State Constitution.” And, “the NY

Constitution prevails over statutes referencing consolidation, or some form thereof.” The

Court noted that “there are practices to deal with the reality of multiple forums.

Discovery can be coordinated. All parties can be invited to the depositions, and

transcripts made available. The process of coordination can have its own limitations;

thus, it was only recently that counsel for a non-party could actively participate in a

deposition.”

S&R Medical, P.C. v. Allstate Property & Casualty Insurance Company, N.Y.L.J.,

1202785146334 (App.Term 2d Dept. 2017) – Civil Court properly denied plaintiff’s

motion for a default judgment. “Plaintiff’s affidavit of service demonstrates that service

was made in Hauppauge, which is in Suffolk County, outside the City of New York.

Section 403 of the New York City Civil Court Act provides that service ‘shall be made

only within the city of New York unless service beyond the city be authorized by this act

or by such other provision of law, other than the CPLR, as expressly applies to courts of

limited jurisdiction or to all courts of the state.’ Plaintiff appears to be arguing that

defendant is not a resident of the City and, thus, to be implicitly arguing that the service

was valid pursuant to CCA 404, which provides for service outside the City upon

nonresidents in certain enumerated instances. However, defendant’s position is that it is

a resident of the City of New York, in which case, pursuant to CCA 403, service was

invalid. As neither plaintiff’s complaint nor its motion papers set forth any facts allowing

for jurisdiction to be acquired over defendant by service outside the City of New York

pursuant to CCA 404 [citations omitted] plaintiff has failed to show that service had been

validly effectuated, and, thus, plaintiff ailed to establish its entitlement to a default

judgment.”

811 Walton Rescue, LLC v. 811 Walton Tenants Corp., N.Y.L.J., 1202794949290

(Sup.Ct. Bronx Co. 2017)(Tapia, J.) – The Court declines to remove to itself a Civil

Court Landlord/Tenant action between the parties for purposes of consolidation with this

action. “Civil Court is the preferred forum for resolving landlord-tenant issues because it

has the unique ability to resolve such issues [citations omitted]. In the absence that Civil

Court is unable to afford complete relief to the plaintiffs, there is no basis for an

application to Supreme Court.” And, here, “plaintiff/tenant is entitled to not only assert

its causes of action in this instant case as defenses to the civil court matter, but it is also

entitled to conduct discovery in civil court regarding the issue of the validity of the

Default Notice and Notice to Terminate. Availability of discovery in a summary

proceeding has been widely recognized [citation omitted]. Thus, this Court agrees with

Defendant/co-op’s attorney that Plaintiff/tenant’s causes of action can be asserted as

defenses in civil court.”

COMMENCING THE ACTION


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Matter of Pidot v. Macedo, 140 A D 3d 991 (2d Dept. 2016) – CPLR 304(a) provides,

inter alia, “that ‘where a court finds that circumstances prevent immediate filing, the

signing of an order requiring the subsequent filing at a specific time and date not later

than five days thereafter shall commence the action.’ Here, the Supreme Court erred in

making a determination regarding whether or not circumstances prevented immediate

filing were present [citation omitted]. That issue was determined upon the signing of the

order to show cause on May 6, 2016, and the Supreme Court did not have authority to

review the determination of a justice of coordinate jurisdiction.”

Wesco Insurance Company v. Vinson, 137 A D 3d 1114 (2d Dept. 2016) – A prior year’s

“Update” reported on Grskovic v. Holmes, 111 A D 3d 234 (2d Dept. 2013). There,

shortly before the running of the statute of limitations, plaintiff’s counsel established a

temporary e-filing user account, and “using what it believed to be a valid and operational

e-filing account, then electronically purchased an index number using credit card

information and ‘filed’ the summons and complaint. The filing was confirmed in an

email message from the court,” which “contained the word ‘confirmation’ in large bold

typeface and further stated that ‘the NYSCEF web site has received document(s) from the

filing user for case/claim number not assigned,’ and instructed counsel to ‘please print

this as a confirmation of your filing(s).’ The filed documents were specifically identified

in the confirmatory email message as a ‘summons and complaint.’” Counsel thereafter

searched in vain for the assignment of an index number. It was only after the statute of

limitations had run that counsel discovered that the e-filing “had been within NYSCEF’s

‘practice/training’ system and not in its ‘live’ system and, therefore, the plaintiff’s

summons and complaint were never actually filed.” Under the circumstances, the Court

concluded that plaintiff’s counsel “could reasonably be viewed” as having been misled.

But, “that said, the question remains, under these discrete circumstances, whether the

Supreme Court should have granted the plaintiff’s motion pursuant to CPLR 2001 to

deem the summons and complaint filed” nunc pro tunc. For, “legislative history makes

clear that although the purpose of the 2007 amendment [to CPLR 2001] was to ‘fully

foreclose dismissal of actions for technical, non-prejudicial defects,’ it was not intended

to ‘excuse a complete failure to file within the statute of limitations’ [citation omitted].

The measure affords the court the discretion to correct ‘a mistake in the method of filing,

as opposed to a mistake in what is filed.’” And here, “contrary to the defendant’s

contention and the Supreme Court’s determination, the plaintiff’s mistake constitutes a

mistake in the method that was used in filing in a ‘practice’ system instead of in a ‘live’

system” [emphasis by the Court]. The Court also rejected defendant’s argument “that the

plaintiff’s e-filing error cannot be corrected, as doing so would prejudice the defendant

by depriving her of a viable statute of limitations defense.” Properly construed, the Court

holds, CPLR 2001 does not require a showing of lack of prejudice in order to correct a

mistake. “CPLR 2001 recognizes two separate forms of potential relief to address

mistakes, omissions, defects, or irregularities in the filing of papers. The statute

distinguishes between the ‘correction’ of mistakes and the ‘disregarding’ of mistakes, and


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each invokes a different test. Courts may ‘correct’ mistakes ‘upon such terms as may be

just’ (CPLR 2001). The statute then says, set off by an ‘or,’ that mistakes may be

‘disregarded’ if a substantial right of a party is not prejudiced (id.). Thus, a ‘correction’

of a mistake appears to be subject to a broader degree of judicial discretion without

necessary regard to prejudice, whereas a complete ‘disregarding’ of a mistake must not

prejudice an opposing party.” This distinction “makes sense, as a party seeking to wholly

disregard a filing mistake may understandably be expected to bear a higher burden than a

party seeking a mere correction.” Here, granting relief to plaintiff involves the

“‘correction’ of the ‘practice’ filing that had, in fact, been timely undertaken by the

plaintiff’s counsel.” That “‘filing’ was performed in a mistaken manner and method,

which courts are permitted to correct on terms that may be just [citation omitted;

emphasis by the Court]. Therefore, the plaintiff was under no burden to demonstrate an

absence of prejudice to the defendant. In contrast, excusing a clearly untimely filing

would constitute the disregarding of an error, which could not be permitted because it

would be prejudicial to a defendant to deprive it of a legitimate statute of limitations

defense. That, however, is a circumstance that we find not to exist here.” Last year’s

“Update” reported on Fox v. City of Utica, 133 A D 3d 1229 (4th Dept. 2015). There,

“plaintiff filed a verified claim in this action and, before answering, defendants filed a

CPLR 3211 motion to dismiss, contending that plaintiff had ‘yet to file a Summons or a

Complaint’ and that ‘a complete failure to file is a jurisdictional defect.’ Relying upon

CPLR 2001, Supreme Court deemed the claim to be a complaint and excused the failure

to file a summons as ‘an irregularity that shall be disregarded in this case.’ That was

error. We agree with defendant that CPLR 2001 does not permit a court to disregard the

complete failure to file a summons, i.e., an initial paper necessary to commence an action

[citations omitted]. As recognized by the Court of Appeals, in quoting from the Senate

Introducer’s Memorandum in support of the bill that amended CPLR 2001, the statute

may be invoked as a basis to correct or clarify ‘a mistake in the method of filing, AS

OPPOSED TO A MISTAKE IN WHAT IS FILED’” [block capitals by the Court]. Here

in Wesco, the Second Department held that, “in the Supreme Court, pursuant to CPLR

304, an action is ordinarily commenced ‘by filing a summons and complaint or summons

with notice,’ and a special proceeding is ordinarily commenced ‘by filing a petition’

[citation omitted]. 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.”


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Maddux v. Schur, 139 A D 3d 1281 (3d Dept. 2016) – “‘An action is commenced by

filing a summons and complaint or summons with notice in accordance with CPLR 2102’

[citation omitted]. 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.”

DiSilvio v. Romanelli, 150 A D 3d 1078 (2d Dept. 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

[citation 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.”

Zegelstein v. Faust, 146 A D 3d 499 (1st Dept. 2017) – The court erroneously concluded

that it lacked jurisdiction to entertain plaintiffs’ cross motion for leave to extend the time

for service and to amend the complaint as a result of plaintiffs’ failure to serve the

summons with notice within 120 days of commencement, in violation of CPLR 306-b.

The court was required to exercise its discretion to decide whether an extension of time

for service was warranted upon good cause shown or in the interest of justice.”

Gabbar v. Flatlands Commons, LLC, 150 A D 3d 1084 (2d Dept. 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.”

Jhang v. Nassau University Medical Center, 140 A D 3d 1018 (2d Dept. 2016) –

“Supreme Court improvidently exercised its discretion in denying that branch of the


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plaintiff’s motion which was pursuant to CPLR 306-b for leave to extend the time within

which to serve the summons and complaint by 120 days [citations omitted]. Here, while

the action was timely commenced, the statute of limitations had expired when the

plaintiff moved for such relief, the timely service of process was subsequently found to

have been defective, and the defendant had actual notice of the action within 120 days of

commencement of the action [citations omitted]. Furthermore, the plaintiff demonstrated

that he had a potentially meritorious cause of action, and there was no prejudice to the

defendant attributable to the delay in service.”

Navarrete v. Metro PCS, 137 A D 3d 1230 (2d Dept. 2016) – “It is undisputed that the

plaintiff made no attempt to effect service within 120 days after filing the summons and

complaint, which was necessary to establish good cause under CPLR 306-b [citations

omitted]. Moreover, the plaintiff failed to demonstrate that an extension of time was

warranted in the interest of justice, since she exhibited an extreme lack of diligence in

commencing the action, which was not commenced until the day of the expiration of the

statute of limitations, failed to seek an extension of time until more than 2 1/2 months

after the respondent moved to dismiss for lack of timely service, and did not show the

existence of a potentially meritorious cause of action through any competent evidence.”

Komanicky v. Contractor, 146 A D 3d 1042 (3d Dept. 2017) – “To the extent plaintiff’s

papers in opposition to the motions [to dismiss] 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 any event,

plaintiff did not demonstrate the existence of facts that would support the granting of

such relief. Supreme Court properly found that plaintiff had not shown good cause for an

extension of time [citations omitted] and, upon our careful consideration of the

appropriate factors [citation omitted], we are unpersuaded that the time for service should

have been extended ‘in the interest of justice’ [citation 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]. Moreover, the existence of a meritorious cause of action has not been

established.”

Krasa v. Dial 7 Car & Limousine Service, Inc., 147 A D 3d 744 (2d Dept. 2017) – “The

plaintiff’s cross motion pursuant to CPLR 306-b to extend the time to serve the summons

and complaint upon the defendants should have been denied. 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


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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.”

Bovee v. Champlain Valley Physicians Hospital Medical Center, N.Y.L.J.,

1202759318868 (Sup.Ct. Warren Co. 2016)(Muller, J.) – In this medical malpractice

action, defendant “contends that plaintiffs are not entitled to an extension [of time to

complete service] in the interest of justice because they failed to submit an expert

affidavit in support of the contention that the action is meritorious. This contention is

without merit.” First, “one need not have a medical degree to conclude that claimant

should have been told what the radiologist determined when he reviewed her x-ray.”

Moreover, “the meritorious nature of the action is but one of the many factors to be

considered by the Court in evaluating whether plaintiffs are entitled to an extension of

time in the interest of justice.”

Matter of Rimler v. City of New York, N.Y.L.J., 1202762401324 (Sup.Ct. Kings Co.

2016)(Jimenez-Salta, J.) – “CPLR 306-b prescribes that in an action or proceeding when

the applicable Statute of Limitations is four months or less, service shall be made not

later than fifteen (15) days after the expiration date of the applicable Statute of

Limitations. Challenges to government action under SEQRA must be resolved in a

special proceeding under CPLR Article 78, which provides for a four (4) month Statute

of Limitations. When a government action is subject to review under both SEQRA and

ULURP, the Statute of Limitations for any SEQRA claims begins to commence upon the

completion of the ULURP process which in this case was the City Council approval date

of December 16, 2015.” Thus, “this Court finds that the four (4) month Statute of

Limitations expired on April 16, 2016 and the fifteen (15) day service deadline under

CPLR 306-b expired on May 2, 2016.” However, “Petitioners did not serve any of the

Respondents on or prior to May 2, 2016.” Thus, “none of the Respondents were timely

served.” The Court found no basis for a good cause or interest of justice extension of

petitioners’ time to serve, and dismissed the proceeding. Good cause was lacking

because of a lack of “reasonable diligence” to timely serve, since “Respondents are

public and private entities which can be readily served during business hours at their

known addresses.” And, as to interest of justice extension, “Petitioners did not complete

service until thirty-seven (37) days after the expiration of the Statute of Limitations

which is more than twice the fifteen (15) days provided pursuant to CPLR 306-b. As a

result, this Court finds that this delay is both significant and prejudicial in the context of

an Article 78 proceeding which is subject to an abbreviated four (4) month Statute of

Limitations in recognition of the strong public policy that the operation of governmental

agencies should not be unnecessarily clouded by potential litigation.”


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J.A.P. v. A.J.P., N.Y.L.J., 55 Misc 3d 608 (Sup.Ct. Monroe Co. 2017)(Dollinger, J.) –

Presumably to take advantage of the increase in value of the husband’s assets since this

matrimonial action was commenced some 5 years ago, plaintiff/wife seeks to dismiss this

action, and commence a new one, claiming that she failed to serve defendant within 120

days of commencing the action and that such failure “strips this court of jurisdiction.”

The Court rejects that argument. The failure to timely serve “is exclusively an

affirmative defense available solely to the defendant. Moreover, defendant’s answer, and

participation in the litigation of this matter, acts as an “informal appearance,” which

would have waived any challenge by him to the Court’s jurisdiction.

THE SUMMONS

Fentrez v. Nachla Associates, LLC, N.Y.L.J., 1202771559482 (Sup.Ct. Kings Co. 2016)

(Rivera, J.) – The summons filed in this action was unaccompanied by a complaint, and

failed to provide the “notice” required by CPLR 305(b). That failure is a jurisdictional

defect, which may not be remedied by amendment. “Although the description in a notice

need not be absolutely precise, the complete absence of any notice is a jurisdictional

defect [citations omitted], and that defect renders the summons insufficient not only for

the purposes of taking a default judgment, but also to obtain jurisdiction over a

defendant.” And, having raised the defense of lack of jurisdiction in its answer,

defendant preserved its objection, notwithstanding that it thereafter participated in

discovery.

New Foundation, LLC v. Ademi, 140 A D 3d 1038 (2d Dept. 2016) – “The plaintiff

commenced this action against, among others, David Ademi, doing business as York

Plumbing, to recover damages for breach of contract. Contending that David Ademi was

a nonexistent person and an alias for Avdyl Ademi, the plaintiff moved, in effect,

pursuant to CPLR 305(c) for leave to amend the caption to name Avdyl Ademi, doing

business as York Plumbing, as a defendant instead of the named defendant,” after the

running of the statute of limitations. The Appellate Division reverses the granting of that

motion, because “plaintiff failed to offer any evidence that the proposed defendant was

properly served with process [citations omitted]. Having failed to establish that the

proposed defendant was properly served, plaintiff was not entitled to relief pursuant to

CPLR 305(c).”

West v. City of New York, 143 A D 3d 810 (2d Dept. 2016) – Plaintiff was injured at

LaGuardia Community College when a desk chair he was sitting on collapsed. The

premises is owned by the Dormitory Authority, and leased to City University. Plaintiff

commenced this action against the City of New York and the Dormitory Authority.

When, after the running of the statute of limitations, those defendants sought summary

judgment, asserting that they were not proper parties to this action, plaintiff cross-moved


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to amend the caption to substitute City University “and to deem the summons and

complaint served upon CUNY nunc pro tunc.” The Appellate Division affirms the denial

of that cross-motion. “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 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 [citation omitted], 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.”

Gil v. Reyes, 143 A D 3d 572 (1st Dept. 2016) – Plaintiffs “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.”

Konner v. New York City Transit Authority, 143 A D 3d 774 (2d Dept. 2016) – Although

this case arises in the context of a notice of claim, it raises issues often seen in summons

“misnomer” cases. Plaintiff claims to have been injured in a subway accident. The

notice of claim was addressed to the Metropolitan Transportation Authority and served

on that Authority. Plaintiff then received a letter, without letterhead, or other indication

as to which Authority sent it, but with a “TA” claim number. It stated that “‘by virtue of

the power conferred on the New York City Transit Authority by Public Authorities Law

§1200 et seq., as amended, the claimant is hereby required to appear and be sworn at the

office of the Authority” to give testimony [emphasis by the Court]. The hearing was then

conducted. When plaintiff commenced this action, the Transit Authority moved for

summary judgment on the ground that it had not been served with a notice of claim. The

Court was “mindful that the doctrine of equitable estoppel should be invoked against

governmental entities sparingly and only under exceptional circumstances,” but found

this case to present such circumstances. For, “plaintiff’s submissions demonstrated that

the NYCTA wrongfully or negligently engaged in conduct that misled the plaintiff to

justifiably believe that service of the notice of claim upon the MTA was of no

consequence, and lulled her into sleeping on her rights to her detriment.”

SERVICE OF PROCESS


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WHO MAY SERVE PROCESS

Neroni v. Follender, 137 A D 3d 1336 (3d Dept. 2016) – “Although CPLR 2103(a)

requires service to be made by a person who is not a party to the action, a violation of this

provision ‘is a mere irregularity which does not vitiate service’ where, as here, no

resulting prejudice is shown.”

WHO MUST BE SERVED WITH PROCESS

Friedberg v. Pena, 52 Misc 3d 339 (Sup.Ct. Westchester Co. 2016)(Giacomo, J.) –

Plaintiff served a summons and complaint on an individual defendant and a bank.

Thereafter, before the individual appeared, plaintiff amended the complaint to correct the

caption with respect to the name of the bank. Only the bank was served with the

amended complaint. The ensuing default judgment against the individual defendant is

vacated. “Contrary to plaintiff’s arguments, pursuant to CPLR 3012(a) when he amended

his complaint he was required to serve Pena with the amended complaint in the manner

provided for service of a summons or, at the very least, ‘serve her in the manner provided

for service of papers generally.’”

SERVICE ON INDIVIDUALS

FV-1, Inc. v. Reid, 138 A D 3d 922 (2d Dept. 2016) – “Service of process upon a natural

person must be made in strict compliance with the statutory methods of service set forth

in CPLR 308 [citations omitted]. ‘A defendant’s eventual awareness of pending

litigation will not affect the absence of jurisdiction over him or her where service of

process is not effectuated in compliance with CPLR 308’ [citation omitted]. Thus, ‘a

defect in service is not cured by the defendant’s subsequent receipt of actual notice of the

commencement of the action.’”

Fields v. The County of Westchester, N.Y.L.J., 1202777814154 (Sup.Ct. Westchester Co.

2016)(Giacomo, J.) – For jurisdiction to obtain pursuant to CPLR 308(2) or 308(4) the

leaving (or affixing) and mailing must be accomplished within 20 days of each other.

The failure “to meet the strict requirements” of the statute mandates dismissal.

Deutsche Bank National Trust Company v. O’King, 148 A D 3d 776 (2d Dept. 2017) –

Where service is effected pursuant to CPLR 308(4), the affix and mail method, the

plaintiff must demonstrate that the summons was affixed to the door of the dwelling place

or usual place of abode of the person to be served and mailed to such person’s last known

residence [citation omitted]. The ‘dwelling place’ is one at which the defendant is

actually residing at the time of delivery [citation omitted]. The ‘usual place of abode’ is a

place at which the defendant lives with a degree of permanence and stability and to which

he intends to return.” The same definitions apply to the “leave and mail” provision,

CPLR 308(2).


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Citibank, N.A. v. Balsamo, 144 A D 3d 964 (2d Dept. 2016) – “The plaintiff’s process

server averred that he was denied entry to the defendants’ condominium complex ‘by the

defendants,’ and that he, therefore, left the summons and complaint with ‘JOHN DOE

(NAME REFUSED), SECURITY GUARD.’ ‘If 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.”

JP Morgan Chase Bank, N.A. v. Peters, 55 Misc 3d 849 (Sup.Ct. N.Y.Co. 2017)(Bluth,

J.) – Defendant is in prison. Plaintiff caused service to be made, pursuant to CPLR

308(2), at the address where he lived prior to incarceration. Distinguishing Montes v.

Seda, 157 Misc 2d 895 (Sup.Ct. N.Y.Co. 1993), the Court holds that service was not

made at defendant’s “usual place of abode.” “Unlike the defendant in Montes [who was

serving an 18-month sentence], Peters faces a 40-years-to-life sentence, which clearly

approaches the degree of permanence and stability implied in the term ‘usual place of

abode.” Moreover, “plaintiff presented no evidence in the affidavit of service that the

process server attempted to gain access to the fifth floor so he could serve defendant

Peters at his former apartment or that the doorman refused to grant the process server

permission to enter the building. Plaintiff only claims the doorman confirmed that the

defendant lived at the building. Under these facts, the court is unable to find that delivery

to a doorman in the lobby of defendant’s former residence satisfied due process.”

Thacker v. Malloy, 148 A D 3d 857 (2d Dept. 2017) – At the traverse hearing in this

action, the “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.”

Cornhill LLC v. Sposato, 56 Misc 3d 364 (City Ct. Rochester 2017)(Yacknin, J.) – “New

York appellate courts require that personal service attempts prior to resort to conspicuous

service [pursuant to CPLR 308(4)] must comply with at least two key prerequisites to


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satisfy the due diligence test. First, a minimum of three personal service attempts are

required, with at least two attempts on dates and times when it can reasonably be

expected that the person to be served will not be at work or in transit.” Second, “before

resorting to conspicuous service, a process server must make ‘genuine inquiries’ to

ascertain the party’s place of work so that the party can be served at work, and must

attempt to talk to neighbors or find out where the party might be found [citations

omitted]. Where the party seeking a default money judgment following conspicuous

service of process fails to demonstrate such inquiries, due diligence is not satisfied.”

Deutsche Bank National Trust Co. v. Calviello, 55 Misc 3d 714 (Sup.Ct. Westchester Co.

2017)(Giacomo, J.) – CPLR 308(4) permits service by “affixing” and mailing only when

attempts have been made with “due diligence” to serve by personal delivery or by “leave

and mail.” Here, although plaintiff’s process server attempted to serve defendant at home

on 8 different occasions, weekdays and weekends, at various times of day and evening,

“due diligence” was not shown. Defendant’s “social media and professional profiles are

open to public search” and “she could have been easily located in her professional

capacity through an online search.” Defendant herself “attempted an online search and in

less than two minutes she states that she was able to locate her professional social media

profiles, the business listing of her employer and her work phone number.” All of this

“was on the first page of the search engine results.” Thus, the process server’s failure to

attempt to serve her at her place of business defeated any claim of “due diligence”

permitting “nail and mail” service under CPLR 308(4).

Sinay v. Schwartzman, 148 A D 3d 1068 (2d Dept. 2017) – “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 [citation omitted]. Under the

circumstances, a hearing to determine the validity of service upon the defendants was

warranted.”

Greene Major Holdings, LLC v. Trailside and Hunter, LLC, 148 A D 3d 1317 (3d Dept.

2017) – “While the precise manner in which due diligence is to be accomplished [in order

to permit service pursuant to CPLR 308(4)] is ‘not rigidly prescribed’ [citation omitted],

the requirement that due diligence be exercised ‘must be strictly observed, given the

reduced likelihood that a summons served pursuant to CPLR 308(4) will be received’

[citations omitted]. What constitutes due diligence is determined on a case-by-case basis,

focusing not on the quantity of the attempts at personal delivery, but on their quality’

[citations omitted], and the plaintiff, who bears the burden of establishing that personal

jurisdiction over the defendant was acquired [citation omitted], must show ‘that the

process server made genuine inquiries about the defendant’s whereabouts and place of

employment.’” Here, the 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.,


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on December 11, 2013 at 5:17 p.m., and on December 13, 2013 at 4:19 p.m.” The

Appellate Division agrees 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.”

Niagara Mohawk Power Corp. v. Wheeler, N.Y.L.J., 1202759880779 (City Ct. Albany

2016)(Marcelle, J.) – While the so-called “rule of three” – that three attempts at service

on different days and different times suffices for “due diligence” pursuant to CPLR

308(4) – is “enticing,” the Court holds “that due diligence refers to the quality of the

effort to effect personal service, not the frequency of attempts.” Here, plaintiff has made

no showing of “some type of independent verification by a third party source of the

defendant’s address,” and thus there is no showing of steps “to ensure that it was

attempting to serve the defendants at their correct residences.” Accordingly, the Court

cannot find due diligence, and denies plaintiff’s motion for a default judgment.

Brown v. A 1998 Dodge, Vin No. 1B7GG22X1WS701157, N.Y.L.J., 1202770424964

(Sup.Ct. Suffolk Co. 2016)(Mayer, J.) – “The due diligence requirement of CPLR 308(4)

must be strictly observed, given the reduced likelihood that a summons served pursuant

to that section will be received [citations omitted]. A defendant’s eventual awareness or

actual awareness of pending litigation will not affect the absence of jurisdiction over him

or her where service of process is not effectuated in compliance with CPLR 308 [citations

omitted]. What constitutes due diligence is determined on a case-by-case basis, focusing

not on the quantity of the attempts at personal delivery, but on their quality [citations

omitted]. Attempting to serve a defendant at his or her residence without showing that

there was a genuine inquiry about the defendant’s whereabouts and place of employment

is fatal to a finding of due diligence as required by CPLR 308(4) [citations omitted].

Further, absent any evidence that the process server attempted to determine that the

address where service was attempted was, in fact, the actual dwelling or usual place of

abode of the defendant, such as by searching telephone listings or making inquiries of

neighbors, the requirement of CPLR 308(4), that service under CPLR 308(1) and (2) first

be attempted with ‘due diligence,’ is not met.”

Koiv-Urban v. Mekies, 53 Misc 3d 691 (Sup.Ct. N.Y.Co. 2016)(Bluth, J.) – The

complaint in this action describes defendant as a “Moroccan-French citizen” who is a

“‘missing person’ who has not lived in the United States for 20 years.” Particularly under

these circumstances, plaintiff has failed to demonstrate sufficient due diligence to permit

service pursuant to CPLR 308(4) “at a 30 year old address.” Moreover, service at a “last

known address” is insufficient under the statute, and, in any event, “three visits by the

process server, all during normal business hours, does not constitute due diligence.”


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Oglesby v. Barragan, 135 A D 3d 1215 (3d Dept. 2016) – “‘A court is without power to

direct service pursuant to CPLR 308(5) absent a showing by the moving party that

service under CPLR 308(1), (2) or (4) is impracticable’ [citations omitted]. Although

impracticality does not require a showing of actual attempts to serve parties under every

method in the aforementioned provisions of CPLR 308, the movant is required to make

competent showings as to actual efforts made to effect service.” Here, “the record

reveals that plaintiffs made merely one respective attempt to serve defendants via

certified mail at the addresses listed on the police report related to the accident. When

plaintiffs relied on that police report for such addresses, the report was approximately

three years old. Plaintiffs offer no explanation as to any further attempts to ascertain

defendants’ current addresses other than the conclusory assertion that they have

investigated the whereabouts of Bryan Cuff and Kathi Cuff and concluded that they did

not live in New York. Such conclusory statements and proof of a single failed attempt to

locate defendants based upon three-year outdated records does not establish that service

pursuant to CPLR 308(1), (2) or (4) was impracticable.”

Bovee v. Champlain Valley Physicians Hospital Medical Center, N.Y.L.J.,

1202759318868 (Sup.Ct. Warren Co. 2016)(Muller, J.) – After being given conflicting

information about the whereabouts of defendant Menoscal, plaintiff sought an order,

pursuant to CPLR 308(5), permitting service upon Menoscal’s attorney. In response, the

attorney produced an affidavit from Menoscal, “indicating that he ‘resides in Guttenberg,

New Jersey,’” and that he “has ‘been employed at Metropolitan Hospital in New York

City since July of 2013 as well as continuing to work part time at [defendant] CVPH.’

He is also an attending physician at Astoria Urgent Care Medical Center in Queens. In

view of this information, plaintiffs cannot demonstrate it is impracticable to personally

serve Menoscal under CPLR 308 (1), (2) and (4).” The motion was denied, but without

prejudice. “Inasmuch as Menoscal has declined to provide his actual residence address

and, further, appears to have several places of employment, service upon him may prove

impracticable under CPLR 308(1), (2) and (4) notwithstanding the additional information

provided. Under these circumstances, plaintiffs may file a further motion for permission

to serve Menoscal by service upon his counsel.”

Born To Build LLC v. Saleh, 139 A D 3d 654 (2d Dept. 2016) – After several attempts to

serve defendant, each of which resulted in a motion to dismiss for lack of proper service,

plaintiff sought permission, pursuant to CPLR 308(5), to serve process on defendant’s

attorney. Generally, “‘an attorney is not automatically considered the agent of his or her

client for the purposes of the service of process’ and, absent proof that a defendant has

designated his or her attorney as an agent for the acceptance of process, an attorney lacks

the authority to accept service on the defendant’s behalf.” But, here, “plaintiff

demonstrated that it had been unable to serve the defendant at the addresses available to

it. The defendant stated that she lived and worked in China, but did not disclose either her

business or residence address in that country, thereby preventing the plaintiff from


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attempting international service pursuant to the Hague convention [citations omitted].

Furthermore, the extensive motion practice in this case demonstrates that service of

process on her attorney will be adequate to apprise her of the action.” Accordingly, the

order granting plaintiff’s motion was affirmed.

Matter of J.T., 53 Misc 3d 888 (Fam.Ct. Onondaga Co. 2016)(Hanuszczak, J.) – “With

the common utilization of e-mail as a means of communication Courts have been inclined

to entertain and grant requests to allow for service by e-mail [citation omitted]. Upon

proper application, both New York Courts and Federal Courts have granted e-mail

service of process as an appropriate method when statutory methods have proven to be

ineffective or impossible. Although not directly set forth in the CPLR as a means of

service there is no prohibition provided appropriate circumstances exist.” Here, “the

Court finds that the father was deported from the United States to Jordan prior to the

child being removed from the mother’s care and his exact whereabouts are unknown.

Furthermore, upon the child being removed from the mother’s care the caseworker

maintained communication with the father through electronic mail and the father

requested additional information pertaining to the Court proceedings in e-mail

transmissions. At no time did the father provide any further information as to his

physical address to the caseworker. Based upon these findings the County has

sufficiently demonstrated that it is impractical for personal service of process to be

effectuated.” Accordingly, the Court concludes that the instant termination of parental

rights summons and petition may be served by e-mail upon the father.

Matter of Kevin B. v. Lorena B., N.Y.L.J., 1202778231573 (Fam.Ct. Suffolk Co. 2017)

(Loguercio, J.) – The Court here denies petitioner/father’s application to compel the

Suffolk County Child Support Enforcement Bureau to divulge the address of

respondent/mother so that he might serve process in this proceeding to modify a

judgment. For Social Services Law §111-v imposes strict confidentiality rules for the

prevention of domestic violence. However, exercising its discretion pursuant to CPLR

308(5), the Court permits service by e-mail, regardless whether respondent currently

resides in another country which is a party to the Hague Convention. Petitioner is not

required to demonstrate physical attempts to make service, where, as here, due to lack of

knowledge, such service is “impracticable.”

Qaza v. Alshalabi, 54 Misc 3d 691 (Sup.Ct. Kings Co. 2016)(Sunshine, J.) – The Court

here denies an application pursuant to CPLR 308(5) for service via Facebook. “Plaintiff

has failed to sufficiently authenticate the Facebook profile as being that of defendant and

has not shown that, assuming arguendo that it is defendant’s Facebook profile, that

defendant actually uses this Facebook page for communicating.” For, the profile

suggested by plaintiff “has not been updated since April 27, 2014.” And, “while

plaintiff’s counsel contends that plaintiff has communicated with defendant through

Facebook the plaintiff’s affidavit is entirely silent regarding any alleged communication


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with defendant through Facebook including any representation regarding dates when she

communicated with defendant or that she communicated with defendant through this

Facebook page. The Court notes that plaintiff did not annex copies of any of the alleged

Facebook correspondence with defendant that she contends link him to this Facebook

profile.” Allowing service via Facebook on these facts “would be akin to the Court

permitting service by nail and mail to a building that no longer exists.”

SERVICE PURSUANT TO THE VEHICLE AND TRAFFIC LAW

Ocean v. Gustave, N.Y.L.J., 1202768914711 (Sup.Ct. Kings Co. 2016)(Martin, J.) –

Vehicle and Traffic Law §253 provides an alternative method of service of process when

the cause of action arises from a non-resident’s use of an automobile in New York. But,

as the Court here holds, the provisions of that statute must be strictly complied with.

Where, as here, the required registered mail of the summons and complaint is returned as

“unclaimed,” plaintiff must file the original envelope and an affidavit within 30 days of

receipt of the return of the envelope from the postal authorities. Here, while plaintiff

averred that he complied with the statute, “he fails to offer any proof of when he actually

received notice that the initial mailing was ‘unclaimed.’ Indeed, the USPS printout

indicates that the initial mailing was returned over two months earlier.” Therefore,

plaintiff failed to demonstrate compliance with the statute.

SERVICE IN A FOREIGN COUNTRY

Mutual Benefits Offshore Fund v. Zeltser, 140 A D 3d 444 (1st Dept. 2016) – Back in

2001, the First Department, in Sardanis v. Sumitomo Corporation, 279 A D 2d 225 (1st

Dept. 2001), held that Article 10(a) of the Hague Convention, which provides that the

Convention “shall not interfere with” the “freedom to send judicial documents by postal

channels, directly to persons abroad” [emphasis added], does not permit service of

process by such “postal channels.” Relying upon a Third Department decision that that

Court would later overrule [Reynolds v. Koh, 109 A D 2d 97 (3d Dept. 1985)], the Court

concluded that “service” is a “term of art,” and not encompassed by the word “send.”

Sardanis remained the law in the First Department even though all of the other

Departments held to the contrary [Fernandez v. Univan Leasing, 15 A D 3d 343 (2d

Dept. 2005); New York State Thruway Authority v. French, 94 A D 3d 17 (3d Dept.

2012)(overruling Reynolds); Rissew v. Yamaha Motor Company, 129 A D 2d 94 (4th

Dept. 1987)]. Here, in Mutual Benefits, the First Department joins the other

Departments, overruling Sardanis. “We now join our sister Departments and hold that

service of process by mail ‘directly to persons abroad’ is authorized by article 10(a) of

the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in

Civil or Commercial Matters (20 UST 361, TIAS No. 5568 [1969][Hague Convention]),

so long as the destination state does not object to such service.”


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PROOF OF SERVICE

South Point, Inc. v. John, 140 A D 3d 1150 (2d Dept. 2016) – “While a process server’s

affidavit ordinarily constitutes a prima facie showing of proper service [citation omitted],

the document denominated by the plaintiff as an affidavit of service does not demonstrate

on its face that it was executed before a notary public, as the alleged notary’s illegible

signature was not accompanied by any of the information mandated by Executive Law

§137.” Accordingly, “the plaintiff failed to demonstrate the defendant’s default.”

APPEARANCE BY COUNSEL

Schoenefeld v. Schneiderman, 821 F.3d 273 (2d Cir. 2016) – The Second Circuit Court of

Appeals here reverses the judgment of the United States District Court for the Northern

District of New York [907 F.Supp.2d 252 (N.D.N.Y. 2011)] reported on in a prior year’s

“Update,” which had declared Judiciary Law §470 unconstitutional. The statute requires

that, to appear as counsel in New York, a nonresident of the State, who is a member of

the New York bar, must maintain an “office for the transaction of law business” within

the State. Last year’s “Update” reported on a decision of the New York Court of

Appeals, upon a certified question from the Second Circuit, interpreting that statute

[Schoenefeld v. State of New York, 25 N Y 3d 22 (2015)]. The Second Circuit asked the

New York Court of Appeals what are “the minimum requirements necessary to satisfy

the statutory directive that nonresident attorneys maintain an office within the State ‘for

the transaction of law business.’” The Court responded “that the statute requires

nonresident attorneys to maintain a physical office in New York.” The defendant State of

New York, “recognizing that there may be a constitutional flaw if the statute is

interpreted as written,” had urged the Court “to construe the statute narrowly in

accordance with the doctrine of constitutional avoidance [citations omitted]. In

particular, they suggest that the provision can be read merely to require nonresident

attorneys to have some type of physical presence for the receipt of service – either an

address or the appointment of an agent within the State. They maintain that interpreting

the statute in this way would generally fulfill the legislative purpose and would ultimately

withstand constitutional scrutiny.” However, the language and legislative history of the

statute make it “difficult to interpret the office requirement as defendants suggest. As the

Second Circuit pointed out, even if one wanted to interpret the term ‘office’ loosely to

mean someplace that an attorney can receive service, the additional phrase ‘for the

transaction of law business’ makes this interpretation much less plausible.” Now, armed

with the definitive interpretation of the demands of the statute, a divided Second Circuit

concludes “that §470 does not violate the Privileges and Immunities Clause because it

was not enacted for the protectionist purposes of favoring New York residents in their

ability to practice law. To the contrary, the statute was enacted to ensure that nonresident

members of the New York bar could practice in the state by providing a means, i.e., a


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New York office, for them to establish a physical presence in the state on a par with that

of resident attorneys, thereby eliminating a service-of-process concern. We identify no

protectionist intent in that action. Indeed, it is Schoenefeld who, in seeking to practice

law in New York without a physical presence in the state, is looking to be treated

differently from, not the same as, New York resident attorneys. Such differential

treatment is not required by the Privileges and Immunities Clause.”

Stegemann v. Rensselaer County Sheriff’s Office, ___ A D 3d ___, 2017 WL 3441312

(3d Dept. 2017) – The Court denies applications for “nunc pro tunc waivers of the law

office requirement of Judiciary Law §470 to enable [applicant attorneys] to practice

before this Court.” For “the Court of Appeals [has] held that, ‘by its plain terms,

Judiciary Law §470 requires nonresident attorneys practicing in New York to maintain a

physical law office here.’” And the requests for a waiver of the rule “‘finds no support in

the wording of the provision and would require us to take the impermissible step of

rewriting the statute’ [citation omitted]. In addition to holding that no statutory authority

exists for granting the waivers, we also find that creating an avenue for nonresident

attorneys to obtain a waiver of the law office requirement would amount to the type of

rulemaking reserved for the Court of Appeals.” However, “we reject plaintiff’s

contention that all of the work performed by [the out-of-state attorneys] in this action

should be declared void from the beginning. In reaching this conclusion, we adopt the

Second Department’s reasoning in Elm Mgt. Corp. v. Sprung (33 A D 3d 753 [2006]) the

‘the fact that a party has been represented by a person who was not authorized or

admitted to practice law under the Judiciary Law does not create a “nullity” or render all

prior proceedings void per se.’ [citations omitted], and we note our disagreement with the

First Department’s cases holding to the contrary.”

Arrowhead Capital Finance, Ltd v. Cheyne Specialty Finance Fund L.P., N.Y.L.J.,

1202764119157 (Sup.Ct. N.Y.Co. 2016)(Kornreich, J.) – Goldin, plaintiff’s attorney,

“lists what he refers to as his ‘main office’ in Pennsylvania (PA Office). When he filed

the summons and complaint in this action, on June 27, 2014, he listed his PA Office and

its telephone and fax numbers, as well as an address at 240 Madison Avenue, 3rd Floor,

NY, NY 10016 (240 Madison).” Defendant’s attorney avers that at 240 Madison

Avenue, there is “no visible sign for Goldin” outside or inside, or on the 3rd floor. Also,

“Goldin’s stationery letterhead” only lists the PA Office. The Madison Avenue address

is apparently the office of one of Goldin’s clients, that he “had use of” to receive

“documents, packages and boxes.” The Court notes that “numerous cases in the First

Department have held, before the recent Schoenefeld rulings [discussed directly above],

that a court should strike a pleading, without prejudice, where it is filed by an attorney

who fails to maintain a local office, as required by [Judiciary Law] §470.” And,

“receiving mail and documents is insufficient to constitute maintenance of an office.”

The action was therefore dismissed without prejudice.


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DeMartino v. Golden, 150 A D 3d 1200 (2d Dept. 2017) – “A corporation and limited

liability company must be represented by an attorney and cannot proceed pro se [citations

omitted]. Here, DeMartino Building Co., Inc. and 150 Centreville, LLC, did not appear

by an attorney when the summons and complaint were filed and served. Accordingly, the

complaint, insofar as asserted by them, was a nullity, and the action as to them was

improperly commenced.”

Jefferies, LLC v. A&R Trading Group, LLC, N.Y.L.J., 1202766487802 (Sup.Ct. N.Y.Co.

2016)(Bannon, J.) – The attorneys of record for the parties in this breach of contract

action agreed to electronic filing of all documents, and then stipulated to arbitrate the

dispute before the Financial Industry Regulatory Authority. Thereafter, while

defendants’ attorney of record “e-mailed FINRA and plaintiff’s counsel in August 2014

to inform them that she was withdrawing as the defendants’ attorney, she never moved

for leave to withdraw as attorney of record in this action, and the defendants never

executed or filed a substitution of attorney in this action.” Defendants appeared, by

different counsel, in the arbitration. After the arbitrators ruled in plaintiff’s favor,

“plaintiff moved pursuant to CPLR 7510 to confirm the arbitration award, and the

defendants’ attorney of record did not oppose the motion.” Now, seeking to vacate the

ensuing judgment, defendants “argue that the plaintiff’s failure to physically serve their

arbitration attorney with the papers constituting the motion to confirm the award

constituted a reasonable excuse for their default in opposing the motion.” The Court

disagrees. “‘From the standpoint of adverse parties, counsel’s authority as an attorney of

record in a civil action continues unabated until the withdrawal, substitution, or discharge

is formalized in a manner provided by CPLR 321’ [citations omitted]. This rule protects

adverse parties from the uncertainty of when or whether the authority of an opposing

attorney has been terminated [citations omitted], even when the adverse party is

informally aware that a discharge or substitution of an opposing counsel is pending or

imminent [citations omitted]. An attorney may not simply withdraw as attorney of record

without leave of court.” Thus, “since, here, the defendants’ litigation counsel never

obtained leave of court to withdraw as attorney of record, and was never formally

substituted, she remained attorney of record for the purposes of this litigation, and only

she, on behalf of the defendants, was entitled to notice of the plaintiff’s motion.”

Moreover, since the parties had consented to electronic filing, they were subject to 22

NYCRR 202.5-b(f)(2)(ii), which, as relevant, provides that “where parties to an action

have consented to e-filing, a party causes service of an interlocutory document to be

made upon another party participating in e-filing by filing the document electronically.”

And, “upon receipt of an interlocutory document, the NYSCEF site shall automatically

transmit electronic notification to all e-mail service addresses in such action.” Upon such

transmission, “each party receiving the notification shall be responsible for accessing the

NYSCEF site to obtain a copy of the document received.” The transmission of the

notification “shall constitute service of the document on the e-mail service addresses

identified therein.” Thus, “the failure of an attorney of record to check for or respond to


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papers that were properly e-filed” cannot “give rise to a reasonable excuse for the

defendants’ failure to oppose the plaintiff’s motion.”

DEFENDANT’S RESPONSE TO BEING SERVED

Wimbledon Financing Master Fund, Ltd. v. Weston Capital Management LLC, 150 A D

3d 427 (1st Dept. 2017) – The case law is well-settled that a defendant may not appear

and demand a complaint prior to being served. Here, the individual defendant was served

by substituted service pursuant to CPLR 308(2). Defendant served a demand for a

complaint after the summons was “left” and “mailed,” but before proof of service was

filed. “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.”

Matter of Williams v. Ponte, 145 A D 3d 1022 (2d Dept. 2016) – “Contrary to the

petitioner’s contention, the respondents’ attempts to procure an adjournment of the return

date of the petition did not constitute a formal appearance in the proceeding, nor amount

to a waiver of any objection to personal jurisdiction.”

Scanomat A/S v. Boies, Schiller & Flexner, N.Y.L.J., 1202779528329 (Sup.Ct. N.Y.Co.

2017)(Freed, J.) – The nonresident petitioner’s commencement of this proceeding to stay

arbitration invoked the Court’s jurisdiction, and gave it the power to consider

respondent’s counterclaims, upon sua sponte converting the special proceeding into a

plenary action.

Clement v. Durban, 147 A D 3d 39 (2d Dept. 2017) – “This appeal raises a constitutional

issue of first impression in the appellate courts. CPLR 8501(a) and 8503 require

nonresident plaintiffs maintaining lawsuits in New York courts to post security for the

costs for which they would be liable if their lawsuits were unsuccessful. On this appeal,

we are asked to determine whether this requirement violates the Privileges and

Immunities Clause of the United States Constitution (US Const, art IV, §2). We hold that

the statutes, insofar as they are challenged, do not deprive nonresident plaintiffs of

reasonable and adequate access to New York courts, and thus, do not violate the

Privileges and Immunities Clause.” That clause does not mandate “that state citizenship

or residency may never be used by a State to distinguish among persons [citations

omitted]. ‘Nor must a State always apply all its laws or all its services equally to anyone,

resident or nonresident, who may request it so to do’ [citations omitted]. ‘Rather, the

Privileges and Immunities Clause protects only those privileges and immunities that are

“fundamental.”’” And, here, “the challenged statutory provisions do not deprive

noncitizens of New York of reasonable and adequate access to New York courts. The


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requirement that a nonresident plaintiff who has not been granted permission to proceed

as a poor person post the modest sum of $500 as security for costs is reasonable to deter

frivolous or harassing lawsuits and to prevent a defendant from having to resort to a

foreign jurisdiction to enforce a costs judgment.”

Capital One Bank, N.A. v. Faracco, 149 A D 3d 590 (1st Dept. 2017) – “The filing of a

notice of appearance by counsel on defendant’s behalf, after the time to answer had

expired, and without making any objection to personal jurisdiction, waived defendant’s

challenge to such jurisdiction. Accordingly, the court properly denied defendant’s

motion, made four months after such appearance.” The Court cited Matter of Nicola v.

Board of Assessors of the Town of North Elba, 46 A D 3d 1161 (3d Dept. 2007). But that

case involved an RPTL Article 7 proceeding, in which the failure to answer results

automatically in deeming the allegations of the petition denied. And, more importantly,

while the Nicola Court quoted that “‘service of process can be waived by respondent

simply by appearing in the proceeding and submitting to the court’s jurisdiction,’” the

Court went on to accurately recite the law: “Such an appearance will operate to waive

objections to the court’s personal jurisdiction ‘unless an objection to jurisdiction under

CPLR 3211(a)(8) is asserted by motion or in the answer as provided in rule 3211’”

[emphasis added].

American Home Mortgage Servicing, Inc. v. Arklis, 150 A D 3d 1180 (2d Dept. 2017) –

After Supreme Court directed entry of a default judgment for defendant’s failure to

appear, “defendant’s attorney appeared at a foreclosure settlement conference and

executed a form notice of appearance, bearing the caption and index number of the

action, and stating the name, address, and contact information of the attorney’s firm.”

Almost two years later, plaintiff’s assignee moved for leave to enter a judgment of

foreclosure and sale, and defendant, represented by the same attorney, “cross-moved

pursuant to CPLR 3211(a)(8) to dismiss the complaint insofar as asserted against her for

lack of personal jurisdiction, arguing that she did not live at the subject property at the

time that service was purportedly made upon her at that address and, therefore, service

was not properly made upon her.” The Court holds that “the defendant waived any claim

that the Supreme Court lacked jurisdiction over her. Pursuant to CPLR 320(a), ‘the

defendant appears by serving an answer or a notice of appearance, or by making a motion

which has the effect of extending the time to answer.’ Subject to certain exceptions not

applicable here [citation omitted], ‘an appearance of the defendant is equivalent to

personal service of the summons upon him, unless an objection to jurisdiction under

CPLR 3211(a)(8) is asserted by motion or in the answer as provided in CPLR 3211’

[citation omitted]. ‘By statute, a party may appear in an action by attorney [citation

omitted], and such an appearance constitutes an appearance by the party for purposes of

conferring jurisdiction [citations omitted]. 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


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personal jurisdiction at that time or asserted lack of personal jurisdiction in a responsive

pleading [citations omitted]. Accordingly, the defendant waived any claim that the

Supreme Court lacked personal jurisdiction over her in this action [citations omitted]. To

the extent that prior decisions of this Court could be interpreted to require a different

result [citations omitted], they should no longer be followed.”

JP Morgan Chase Bank, National Association v. Venture, 148 A D 3d 1269 (3d Dept.

2017) – “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 by defendant’s assertion of a counterclaim unrelated to this action.”

STATUTE OF LIMITATIONS

PROFESSIONAL MALPRACTICE

Hahn v. Dewey & LeBoeuf Liquidation Trust, 143 A D 3d 547 (1st Dept. 2016) –

“Defendants established that the causes of action alleging legal malpractice accrued in

2000-2001, when they issued opinion letters and rendered advice that plaintiffs were not

required to register a tax shelter [citations omitted]. Although plaintiffs claim not to have

discovered that this advice was incorrect until years later, ‘what is important is when the

malpractice was committed, not when the client discovered it.’” And, “contrary to

plaintiffs’ argument, the special facts doctrine is inapplicable. The doctrine generally

applies to claims of fraud in sales transactions [citation omitted]. Further, at the time

defendants rendered erroneous tax advice, neither the applicable statute of limitations nor

precedent establishing the accrual date of malpractice claims [citation omitted] were

peculiarly within defendants’ knowledge [citation omitted], and that same information

could have been discovered by plaintiffs through the exercise of ordinary intelligence.”

Bronstein v. Omega Construction Group, Inc., 138 A D 3d 906 (2d Dept. 2016) –

“Regardless whether they are framed as claims sounding in contract or tort, allegations of

professional malpractice, are governed by a three-year statute of limitations [citations

omitted]. Accrual of a claim to recover for professional malpractice occurs upon the

completion of performance and the resulting termination of the professional

relationship.” Here, continuous representation extended the running of the limitations

period, because of “evidence of continuing communications between the parties, and of

efforts by [defendant] Cetera to remedy the alleged errors or deficiencies in the filed

plans.”

Brown v. Hampton Deck, N.Y.L.J., 1202753684483 (Sup.Ct. N.Y.Co. 2016)(Kern, J.) –

Plaintiff hired defendants to construct a deck at plaintiff’s residence, which was


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completed in 2005. “On or about July 10, 2012, Mr. Brown leaned against a portion of

the deck rail, the rail collapsed and he fell approximately fifteen feet to the ground,

sustaining injuries.” This action for personal injuries was commenced on March 5, 2015.

The Court rejects defendants’ claim that this action is time-barred pursuant to CPLR

214(6). First, defendants “failed to make a prima facie showing that they were an

architect or other professional to whom CPLR 214(6) would apply.” The shortened

professional malpractice statute does not apply to contractors. In any event, “the rule that

a cause of action for negligent design accrues upon completion of the construction is only

applicable where the cause of action is for damages to property which has its genesis in

the contractual relationship between the parties and it does not apply to actions for

personal injury. It is well established that a cause of action for personal injury, which is

what plaintiff is asserting in this action, has a three year statute of limitations which

accrues when the plaintiff is injured.” Hence, this action is timely.

Neuberger Berman Trust Co., N.A. v. Schlesinger, N.Y.L.J., 1202761664352 (Surr. Ct.

N.Y.Co. 2016)(Anderson, J.) – In this legal malpractice action, the claim is premised

upon an error in an estate tax return prepared by defendants which cost the estate almost

$3 million. The return was filed in 2003. However, defendants “continued to provide

legal services to the estate through April 2012.” The continuous representation doctrine

“tolls the limitations period ‘only where there is a mutual understanding of the need for

further representation on the specific subject matter underlying the malpractice claim,’”

and defendant urges that “the ‘specific legal matter’ was the preparation of the estate tax

return,” and that, therefore, the statute of limitations began to run when it was filed in

2003. The Court, however, holds that “when an estate fiduciary retains counsel in

connection with estate administration, it is reasonable for both the lawyer and the

client/fiduciary to contemplate that the lawyer’s responsibilities will continue until the

client’s fiduciary role has been completed. In the context of such a lawyer-client

relationship, the preparation of a tax return is but one point on a continuum, rather than a

separate matter that is distinct from any other service that the lawyer may be asked to

perform for the client.” Hence, the motion to dismiss the claim is denied.

Aaron v. Deloitte Tax LLP, 149 AD 3d 580 (1st Dept. 2017) – In this accountant’s

malpractice action, the engagement letter provided “that any action brought relating to

the engagement must be commenced within one year of the accrual of the cause of action.

The accrual of plaintiff’s accounting malpractice claim was on January 21, 2009, the date

decedent signed the last document that was part of the estate tax plan formulated by

defendant.” And, “plaintiffs may not avail themselves of the continuous representation

tolling doctrine because the limitations period was contractual, not statutory, and was

reasonable.”


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MEDICAL MALPRACTICE VS. NEGLIGENCE

Koster v. Davenport, 142 A D 3d 966 (2d Dept. 2016) – Plaintiff claims that defendant

doctor “was negligent because he unknowingly used Monocryl Plus to close plaintiff’s

surgical incision, rather than Monocryl, which he allegedly intended to use. The plaintiff

further alleged that the hospital was negligent for failing to comply with an order by

Davenport to provide Monocryl.” Contrary to plaintiff’s contention, the action sounds in

malpractice rather than negligence, notwithstanding that “the distinction between medical

malpractice and negligence is a subtle one.” For, “here the crux of the plaintiff’s case

concerns the defendants’ alleged failure to use and/or provide the correct suture material,

which is an allegation of medical malpractice. Indeed, a claim based upon the allegation

that the wrong suture material was used in suturing a surgical wound concerns the

‘performance of functions that are an integral part of the process of rendering medical

treatment to a patient.’”

THE FOREIGN OBJECT RULE

Knox v. St. Luke’s Hospital, 140 A D 3d 501 (1st Dept. 2016) – Last year’s “Update”

reported on Walton v. Strong Memorial Hospital, 25 N Y 3d 554 (2015). There, in its

first significant application of the foreign object rule in almost 20 years, the Court of

Appeals has, if not reversed its prior course with respect to that rule, at least significantly

shifted its emphasis. In 1986, at the age of three, plaintiff underwent surgical repair of

his heart. During the surgery, catheters and drainage tubes were placed in his body, to be

removed days later. When they were removed, a “nursing progress note” recorded that

the left atrial line “possibly broke off with a portion remaining” in plaintiff’s body. Some

17 years later, plaintiff suffered symptoms that ultimately led doctors to discover the

piece of catheter that had been left in his body. Supreme Court rejected defendants’

argument that the piece of catheter was a “fixation device,” and hence an exception to the

“foreign object” extension of the statute of limitations. For, “defendants make no

argument that the catheter provided any securing function.” Indeed, “it served no fixative

or fixation purpose. Its nature is not one which closes or fixates anything within a

patient’s body.” However, the Court agreed with defendants that the piece of catheter is

not a “foreign object,” although “the Court of Appeals has defined the term ‘foreign

object’ without any legislative guidance or any reference to a technical or commonly

understood meaning of the term. The court instead appears to speculate as to what the

Legislature intended and it did so with very scant evidence of legislative intent.”

Nevertheless, in LaBarbera v. New York Eye and Ear Infirmary, 91 N Y 2d 207 (1998),

the Court of Appeals held that an object initially left in the patient’s body for a continuing

medical purpose cannot become a “foreign object” by being negligently left behind when

it was later supposed to be removed. And “the Court is required to follow its

understanding of the holding” of the Court of Appeals. The Appellate Division affirmed,

“but our reasoning differs from that of the court [below].” The Appellate Division

concluded that the catheter was a “fixation device.” For, “fixation devices are ‘placed in


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the patient with the intention that they will remain to serve some continuing treatment

purpose’ [citation omitted], while foreign objects are ‘negligently left in the patient’s

body without any intended continuing treatment purpose.’” Here, the catheter “was a

fixation device and was not a foreign object because it was intentionally placed inside

plaintiff’s body to monitor atrial pressure for a few days after the surgery, i.e., it was

placed for a continuing treatment purpose.” The Court of Appeals reversed. The Court

agreed with nisi prius that the catheter was not a “fixation device.” For, it “performed no

securing or supporting role during or after surgery.” The catheter “functioned like a

sentinel, allowing medical personnel to monitor atrial pressure so that they might take

corrective measures as required; the catheters were, in the words of plaintiff’s expert, ‘a

conduit for information from plaintiff’s cardiovascular system.’” Thus, like clamps or

“other surgical paraphernalia,” the catheter was “introduced into a patient’s body solely

to carry out or facilitate a surgical procedure.” Since, therefore, the catheter was not a

fixation device, it was “not categorically excluded from the foreign object exception in

CPLR 214-a.” What remained was for the Court to distinguish this case from its prior

holding in LaBarbera. There, at the end of nasal surgery, the patient left the operating

room with a plastic stent and packing in his nose, which was supposed to be removed

some days later. By mistake, the stent was not removed. The Court held in LaBarbera

that, because the stent was intended to have a continuing function during the several days

after surgery, it was not initially left in the body inadvertently, and was therefore not a

foreign object. Now, the Court says that the stent in LaBarbera was “undeniably” a

fixation device, and leaving it in the body did not convert “a fixation device into a foreign

body.” And, here, “leaving the catheter in plaintiff’s body post-surgery did not convert a

surgical device into a fixation device.” Here, in Knox, “plaintiff acknowledges that the

catheter cuff, which was inserted into his chest to facilitate hemodialysis, was a fixation

device, but argues that when it was inadvertently left in his chest after the catheter tube

was removed, it became a ‘foreign object.’” That argument “is unavailing because only

objects temporarily used in the course of surgery qualify as foreign objects [citations

omitted]. ‘A fixation device cannot be transformed into a foreign object merely because

the continued presence of the fixation device is inadvertent.’”

Livsey v. Nyack Hospital and Rockland Thoracic and Vascular Associates, P.C., 54 Misc

3d 214 (Sup.Ct. Rockland Co. 2016)(Berliner, J.) – The malpractice claim in this action

is that, after surgery, defendants left a ureteral catheter/stent in plaintiff’s body.

Defendant’s expert averred that such a catheter/stent “is placed and left inside of the body

for up to six months in order to bypass an obstruction caused by strictures, stones or

tumors.” Plaintiff’s expert stated that this catheter/stent “was used as a surgical drain to

aid in the draining of fluids from the kidney while the ureteral repair healed and did not

serve a fixative purpose.” Based upon these statements, the Court concludes that the

catheter/stent here “performed no securing or supporting role during or after surgery and

thus does not constitute a fixation device. Its primary purpose was to drain fluids and

would have been introduced solely to facilitate a surgical procedure.” Thus, it was a


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“‘foreign object’ within the ambit of ‘other surgical paraphernalia’ identified in Walton,”

discussed above.

CONTINUOUS TREATMENT

Murray v. Charap, 150 A D 3d 752 (2d Dept. 2017) – According to defendant, during the

relevant period “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.’”

Flaherty v. Kantrowich, 144 A D 3d 542 (1st Dept. 2016) – Plaintiff presented to

defendant optometrist once each year from 2005 to 2012 for an eye examination and

prescription for contact lenses. Every year, defendant “noted the continued existence of

nerve pallor and optic neuropathy. Finally, in 2012, plaintiff saw a neuro-

ophthalmologist who diagnosed him with a meningioma, which caused him to lose sight

in one eye. Plaintiff does not get the benefit of the continuous treatment doctrine in his

malpractice action against defendant based on defendant’s failure to properly diagnose

his condition. “The continuous treatment doctrine does not operate to toll the statute of

limitations because Dr. Kantrowich was not engaged in treatment of plaintiff’s optic

neuropathy, but performed only ‘routine or diagnostic examinations,’ which, even when

conducted repeatedly over a period of time, are not ‘a course of treatment’ [citation

omitted]. The measurement of plaintiff’s nerve pallor annually did not itself amount to

continuous treatment [citation omitted], or reflect any agreement to monitor the

condition, but was part of the routine examination.”

Nisanov v. Khulpateea, 137 A D 3d 1091 (2d Dept. 2016) – In September 2004,

plaintiff’s deceased was referred by her gynecologist to defendant gynecological

oncologist. Defendant removed a polyp from the uterine cavity, which tested as benign,

and told her to return to her gynecologist for regular follow-up care. When plaintiff’s

deceased continued to experience pain, her gynecologist again referred her to defendant

for ultrasound, which revealed fluid in the endometrial cavity. In September 2005,

defendant performed an endometrial biopsy, and an examination which he found to be

“unremarkable.” The deceased was later diagnosed with, and died from, fallopian tube

cancer. This action was commenced in May 2007, claiming that defendant failed to

timely diagnose and treat the cancer. “‘Continuity of treatment is often found to exist

“when further treatment is explicitly anticipated by both physician and patient as

manifested in the form of a regularly scheduled appointment for the near future, agreed

upon during the last visit, in conformance with the periodic appointments which

characterized the treatment in the immediate past”’ [citations omitted]. Here, the plaintiff

failed to show that there was a continuous course of treatment. The diagnostic services


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performed by Khulpateea were discrete and complete, and not part of a course of

treatment [citations omitted]. Moreover, the plaintiff failed to submit evidence showing

that the decedent and Khulpateea contemplated further treatment after the follow-up visit

on September 24, 2004. The decedent did not schedule another appointment with

Khulpateea until she returned to see him in 2005, and she only did so then because [her

gynecologist] referred her to him.”

Pichichero v. Falcon, 142 A D 3d 981 (2d Dept. 2016) – Plaintiff’s dermatologist

referred him to defendant Spinowitz for surgery whenever he diagnosed plaintiff with a

basal cell or squamous cell carcinoma on plaintiff’s head or neck. Defendant

“demonstrated, prima facie, that the continuous treatment doctrine was inapplicable to

the plaintiff’s claims against him because his treatment of the plaintiff was not

continuous. Spinowitz rendered a discrete course of treatment in connection with each

Mohs surgery he performed on the plaintiff,” and “there was no mutual anticipation of

further treatment between them inasmuch as he discharged the plaintiff to [his

dermatologist] each time with no instructions to return.” And plaintiff did not return

except when specifically referred by his dermatologist. However, plaintiff raised an issue

of fact, sufficient to defeat Spinowitz’s motion for summary judgment, “as to whether

there was continuity of treatment because, during certain return visits to Spinowitz

between 2000 and 2009, he complained about and sought treatment for a matter relating

to an earlier scalp surgery.”

Lohnas v. Luzi, 140 A D 3d 1717 (4th Dept. 2016) – The majority of this divided Court

holds that “although the record contains evidence of a gap in treatment that exceeds the

2 1/2 year period of limitations, we conclude that there are issues of fact whether plaintiff

and defendant ‘reasonably intended plaintiff’s uninterrupted reliance upon defendant’s

observation, directions, concern, and responsibility for overseeing plaintiff’s progress.’”

The majority concluded that application of the continuous treatment doctrine was not

precluded by defendant’s understanding that plaintiff would return only “on an as needed

basis.” For, “the determination whether continuous treatment exists ‘must focus on the

patient’ [citation omitted] and, ‘in determining whether plaintiff raised an issue of fact

concerning the applicability of the continuous treatment doctrine, her version of the facts

must be accepted as true.’” And, here, “there is support in the record for a finding that

plaintiff ‘intended uninterrupted reliance’” on defendant. For, over the course of seven

years, “plaintiff underwent two surgeries, saw no other physician regarding her shoulder,

and returned to him for further treatment.” The dissent argued that continuity was

lacking, for, during a “gap of more than 2 1/2 years,” plaintiff “had no scheduled return

appointments, sought no patient-initiated appointments, received no treatment of any kind

from defendant, and no medications were prescribed or renewed by defendant on

plaintiff’s behalf. Plaintiff testified at her examination before trial that the reason for

such a long time between these appointments was that she ‘had gotten discouraged with

defendant. It was kind of learn to live with it, you’re going to have problems, kind of


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deal with it type of thing. It was like why keep going back to him, he’s going to keep

telling me the same thing.”

Freely v. Donnenfeld, 150 A D 3d 697 (2d Dept. 2017) – Defendant doctor “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 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.”

Caesar v. Brookman, 51 Misc 3d 743 (Sup.Ct. N.Y.Co. 2016)(Schlesinger, J.) – On

September 28, 2012, plaintiff presented to defendant physician with complaints “of a

possible foreign body in the bottom of his right heel.” Defendant removed a small shard

of glass, dressed the wound, and “instructed plaintiff to apply an antibiotic cream and

change the dressing every day.” On September 30, plaintiff sent an e-mail to defendant,

along with a photograph of the foot, detailing the condition of his foot, and relating that

he was also suffering from a sore throat, aching joints, numbness and weakness.

Defendant responded to the e-mail that same day, saying that the wound “looks good,”

that it was unlikely that the other symptoms were related, that plaintiff should take

antibiotics, and “let me know how you feel tomorrow.” On October 2, plaintiff was

admitted to the hospital as a result of a MRSA infection in the right heel. This

malpractice action was commenced on March 30, 2015. Thus, if the statute began to run

on September 28, 2012, it is time-barred, but if it began to run on September 30, it is

timely. The Court concludes that the continuous treatment doctrine postponed the

running of the statute of limitations until September 30. “The nature of the emails shows

that plaintiff considered defendant to be his doctor treating his foot injury even after his

September 28 visit. Defendant’s September 30 email to plaintiff further evidence such a

relationship, specifically defendant’s advice to ‘take the antibiotics just in case’ the fever

and chills are from the wound, and his request that plaintiff ‘Let me know how you feel

tomorrow.’” This was “‘a continuing effort by Dr. Brookman to treat plaintiff’s

particular right heel condition.’”

Matthews v. Barrau, 150 A D 3d 836 (2d Dept. 2017) – “With respect to failure-to-

diagnose cases, a physician ‘cannot escape liability under the continuous treatment


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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.’” Moreover, “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.”

Clifford v. Kates, N.Y.L.J., 1202784909482 (Sup.Ct. Monroe Co. 2017)(Doyle, J.) –

“Courts have held that when a plaintiff informs the defendant doctor that she is intending

on initiating legal process, the continuous treatment toll ends.”

PRODUCT LIABILITY

Via v. New York City Housing Authority, 137 A D 3d 465 (1st Dept. 2016) – “Plaintiff’s

bedbug claims are not governed by CPLR 214-c(3) because her injuries were not caused

by a ‘substance.’”

All Craft Fabricators, Inc. v. Syska Hennessy Group, Inc., 144 A D 3d 435 (1st Dept.

2016) – “Plaintiffs allege that they were harmed by defendant’s failure to advise them

that there was asbestos in wood panels and doors delivered to their facility for

refurbishment.” The Court rejects “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 plaintiff’s facility had not

yet occurred.” But the Court also rejects plaintiffs’ argument “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.” For, “‘the damage that

plaintiffs are seeking to “undo” is not the fact that they discovered asbestos, but the fact

of its incorporation in their buildings.’” And, the discovery rule of 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.”

Vasilatos v. Dzamba, 148 A D 3d 1275 (3d Dept. 2017) – “The key dispute between the

parties is whether the claimed injuries arising out of exposure to lead paint are patent, in

which the three-year limitations applies, or latent, within the embrace of CPLR 214-c(2).

We have previously recognized that ‘lead poisoning itself is an actionable injury’

[citation omitted], and, to that extent, a patent injury for purposes of the statute of

limitations. That said, we reach a different conclusion with respect to the claimed

cognitive impairments allegedly caused by the lead poisoning, which we agree are latent,

while fully recognizing that such deficits may evolve over a short period of time [citation

omitted]. Consequently, we conclude that CPLR 214-c(2) applies to plaintiff’s cognitive

impairment claim.”


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Wells v. 3M Company, 137 A D 3d 1556 (3d Dept. 2016) – For purposes of CPLR 214-c,

“‘discovery of the injury’ occurs ‘when the injured party discovers the primary condition

on which the claim is based’ [citations omitted], which ‘necessarily contemplates

something less than full awareness that one has been damaged as a result of exposure to a

particular toxic substance’ [citation omitted]. ‘A plaintiff must be considered to have

discovered such an injury when he or she is actually diagnosed as suffering from a

particular disease, even though unaware of its cause’ [citations omitted]. Finally,

‘separate and distinct diseases may constitute different injuries, each with its own time of

discovery.’”

Matter of New York City Asbestos Litigation (Feinberg v. Colgate-Palmolive Co.),

53 Misc 3d 579 (Sup.Ct. N.Y.Co. 2016)(Moulton, J.) – Determining “the date of

discovery of the injury” for purposes of CPLR 214-c can often be a knotty problem. In

the seminal case, Matter of New York County DES Litigation (Wetherill v. Eli Lilly &

Company), 89 N Y 2d 506 (1997), the Court of Appeals, having determined that the

proper test was the discovery of symptoms of the injury, rather than discovery that the

injury was the result of a tort, had no difficulty deciding the case before it. Plaintiff’s

claim was time-barred even if measured from when she was diagnosed with a T-shaped

uterus [a typical symptom of in utero DES exposure], and learned from her sister that she

was likely a DES daughter, rather than her earlier “symptoms” of dysplasia, miscarriages,

and an incompetent cervix. However, looking to potential future cases, the Court, in the

course of its Wetherill decision, stated that: “we recognize that there may be situations in

which the claimant may experience early symptoms that are too isolated or

inconsequential to trigger the running of the Statute of Limitations under CPLR 214-

c(2).” As the Court here in Feinberg aptly quotes, “‘Ay, there’s the rub.’” When do

“isolated or inconsequential” symptoms rise to “discovery of the injury”? How – since

this is a statute of limitations issue, and precision is critical – does a Court determine the

date of “discovery”? In Wetherill, the Court of Appeals did not “elaborate on the factors

which should be considered in determining” those questions. Synthesizing the relevant

case law, the Court here concludes that “the First Department looks to whether a plaintiff

sought regular medical treatment; whether a plaintiff is limited in physical activity or

misses time from work; and whether a plaintiff files a workers’ compensation claim.”

Similarly, “the Third Department and Fourth Department look to these factors,” while

“Second Department cases do not discuss the factors which are helpful in deciding where

the threshold lies.” Here, weighing the evidence adduced by both sides on defendant’s

motion for summary judgment, the Court concludes that “the issue of whether Mrs.

Feinberg’s symptoms were early symptoms which were too isolated or inconsequential

for her to have discovered the injury before February 28, 2008 [three years before this

action was commenced] must be decided by a jury. The evidence does not permit me to

decide the issue as a matter of law. While Mrs. Feinberg experienced many of the

symptoms that one would experience with mesothelioma, those symptoms may have been

attributable to other causes (like pneumonia or cardiomegaly). Therefore, there is an


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issue of fact as to whether the pain and effusions that she experienced prior to February

28, 2008 were in fact symptoms of malignant mesothelioma or, whether the symptoms

related to another illness. Additionally, even assuming that the symptoms were

attributable to mesothelioma, there is an issue of fact as to whether they were early

symptoms which were too isolated or inconsequential to trigger the statute of limitations.

While the CT scans reflected pleural thickening and effusion, the reports describe the

conditions a minimal, small, tiny, mild and/or without significant change.” Moreover,

“prior to February 28, 2008, there is no evidence that Mrs. Feinberg’s physical activity

was limited (in fact the evidence is to the contrary), no evidence that she missed time

from work through 2007 or filed a workers’ compensation claim, and there is no evidence

that she ceased working in 2008 (when she was 76) because of her health.” Finally, and

“most importantly, Dr. Marcoux testified that mesothelioma has a premalignant to a

malignant process, and that it is difficult to pinpoint when the malignant transformation

occurs.”

Malone v. Court West Developers, Inc., 139 A D 3d 1154 (3d Dept. 2016) – Plaintiff was

exposed to mold at his job site between January 2002 and June 2003. He sued for the

injuries he suffered in September 2005. “In order to establish its entitlement to summary

judgment dismissing the complaint on the basis of statute of limitations, defendant was

required to show, at a minimum, that plaintiff’s alleged exposure to a toxic substance did

not occur within three years of the commencement of the action [citation omitted]. If

defendant exposed or continued to expose plaintiff to a toxic substance within three years

of the commencement of the action, plaintiff could not have discovered any resulting

injuries from such exposure at a time that would be barred by CPLR 214-c(2). Given that

a plaintiff cannot discover the injurious effects of exposure to a toxic substance prior to

that exposure occurring, and considering defendant’s concession that plaintiff continued

to be exposed to the mold at a time less than three years prior to the commencement of

the action, defendant is not entitled to summary judgment dismissing the complaint on

statute of limitations grounds. Turning to the allegedly injurious exposure taking place

more than three years prior to the commencement of the action, we find that defendant

did not prove as a matter of law that plaintiff should have discovered his allergy and

asthma conditions at a time that is barred by CPLR 214-c(2). Although plaintiff

exhibited some symptoms, including skin and eye irritation and tightness in the throat, in

the spring and summer of 2002, plaintiff also explained that such symptoms ceased when

he would leave the building at the end of his shifts. Further, plaintiff averred that he did

not seek medical treatment for these symptoms, miss work as a result of the symptoms or

file a workers’ compensation claim until late October 2002. Viewing the evidence in the

light most favorable to plaintiff, the symptoms that plaintiff exhibited more than three

years prior to the commencement of the action were too intermittent and inconsequential

to trigger the running of the statute of limitations pursuant to CPLR 214-c(2).”


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Gordon v. ROL Realty Company, 150 A D 3d 466 (1st Dept. 2017) – “The motion court

erred in dismissing plaintiff’s claim for personal injury due to toxic mold. Plaintiff

sufficiently pleaded that, after August 2010 (within three years of commencing this

action), he suffered from ‘new’ symptoms and injuries, including, among other things,

eczema and significant fungal growth on his tongue and throat. Accordingly, defendants

failed to make a prima facie showing that this claim is time-barred [citation omitted].

While there are factual questions as to whether the sinus infections and related symptoms

suffered prior to August 2010 were ‘qualitatively different’ from plaintiff’s injuries after

August 2010 [citation omitted], at this procedural juncture it would be improper to

dismiss the claim.”

FRAUD

NYAHSA Services, Inc. Self-Insurance Trust v. Recco Home Care Services, Inc., 141

A D 3d 792 (3d Dept. 2016) – The Court here emphasizes that the statute of limitations

for fraud is the greater of 6 years from the fraud or 2 years from reasonably diligent

discovery. “Defendant alleges that Cool committed fraud and that all third-party

defendants committed fraudulent inducement between 1997 and 2009 by, among other

things, failing to disclose the true financial condition of the trust and misrepresenting

Cool’s ability to administer the trust. Defendant concedes in its brief that it discovered

the alleged fraud upon receipt of the first disputed adjustment on March 5, 2010, but it

did not commence this third-party action until July 2013. As defendant did not file the

third-party action within two years of discovery, the causes of action based in fraud are

time-barred under the discovery exception [citations omitted]. However, because the

greater of the two statutes of limitations applies, Supreme Court properly concluded that

certain of defendant’s fraud and fraudulent inducement claims are timely, but only those

that accrued within six years from the commencement of its third-party action.”

Aozora Bank, Ltd. v. Deutsche Bank Securities Inc., 137 A D 3d 685 (1st Dept. 2016) –

Plaintiff invested in “complex financial products backed by mortgages, including

collateralized debt obligations (CDO’s),” structured and sold by defendant. Plaintiff’s

fraud claims are untimely, unless the two year “discovery” rule of CPLR 213(8) applies.

The Court holds that the two year period expired before this action was commenced.

“‘Where the circumstances are such as to suggest to a person of ordinary intelligence the

probability that he has been defrauded, a duty of inquiry arises, and if he omits that

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.’” Here, “one of the

most significant sources of public information putting plaintiff on notice of its fraud

claims is the Senate Report and its associated emails, which actually form the centerpiece

of plaintiff’s complaint. In fact, the Senate Report contains a 45-page section on

Deutsche Bank entitled ‘Running the CDO Machine: Case Study of Deutsche Bank.”

Taken with all the other information available in the public domain, the Senate Report is


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more than sufficient to have placed Aozora on inquiry notice of possible fraud by April

2011 at the latest.”

Norddeutsche Landesbank Girozentrale v. Tilton, 149 A D 3d 152 (1st Dept. 2017) –

This narrowly-divided Court affirms the denial of defendants’ motion to dismiss

plaintiffs’ fraudulent misrepresentation claim as barred by the statute of limitations,

rejecting defendants’ argument that, as a matter of law, plaintiffs were on sufficient

notice to commence the two year discovery period under CPLR 213(8). “‘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, ‘it 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.”

Here, “we make no conclusive finding that plaintiffs were blind to the scheme they

accuse defendants of perpetrating. We merely determine, at this early stage of the

litigation, that the evidence presented by defendants can be interpreted in a myriad of

ways and does not facially clash with plaintiffs’ position that, even having some

knowledge that the Funds had an equity component to them, they could not have known

before the SEC proceeding that extent to which defendants used plaintiffs’ investment to

acquire and control to Portfolio Companies, or otherwise had an obligation, based on the

evidence, to investigate. Thus, Supreme Court properly declined to dismiss the

fraudulent misrepresentation complaint on statute of limitations grounds, and the viability

of the defense must await a fully developed factual record, at which point it can be either

decided as a matter of law on a motion for summary judgment, or at a trial.” The

dissenters argued that “viewing the wealth of information disclosed and available to

plaintiffs, a person of ordinary intelligence would have been aware that the Funds were

not being operated as typical CDOs and that they were acquiring substantial equity

interests in the portfolio companies, not incidental interests in limited circumstances. As

the wrongful acquisition of equity interests is the basis of plaintiffs’ fraud claim, a duty of

inquiry on this topic arose more than two years before the commencement of this action,

which plaintiffs did not satisfy.”

Cannariato v. Cannariato, 136 A D 3d 627 (2d Dept. 2016) – “Where a plaintiff relies

upon the two-year discovery exception to the six-year limitations period, ‘the burden of

establishing that the fraud could not have been discovered prior to the two-year period

before the commencement of the action rests on the plaintiff who seeks the benefit of the

exception’ [citations omitted]. Although the question of when a plaintiff could ‘with


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reasonable diligence have discovered the alleged fraud’ is ordinarily ‘a mixed question of

law and fact,’ summary dismissal is appropriate ‘where it conclusively appears that the

plaintiff has knowledge of facts which should have caused him or her to inquire and

discover the alleged fraud’ [citations omitted]. Thus, although ‘mere suspicion’ will not

substitute for knowledge of the fraudulent act [citation omitted], a plaintiff may not ‘shut

his or her eyes to facts which call for investigation.’”

Frattarola v. Swartz, N.Y.L.J., 1202773784452 (Sup.Ct. Westchester Co. 2016)

(Ruderman, J.) – “A fraud cause of action must be commenced within six years of the

fraud, or within two years from the time the plaintiff discovered the fraud, or could with

reasonable diligence have discovered it, whichever is later [citation omitted]. ‘The test as

to when a plaintiff should have discovered an alleged fraud is an objective one’ [citation

omitted]. A plaintiff will be held to have discovered the fraud when it is established that

plaintiff was possessed of knowledge of facts from which the fraud could be reasonably

inferred [citations omitted]. Here, dismissal is not warranted in view of the fact that the

plaintiff was a minor, or had just turned 18, when the operative notices were given to him

concerning the commencement of the structured settlement payments directly to him.

Given plaintiff’s alleged reliance on his aunt [a defendant in this action] for financial

advice and guidance, and plaintiff’s sworn statement that it would not have been unusual

to sign documents presented to him by his aunt, issues of fact exist as to whether he had

sufficient notice of the events so as to have discovered the fraud earlier than he did

[citation omitted]. Moreover, given ‘Aunt Jane’s’ alleged ‘cover story’ that she was

paying for plaintiff’s tuition with her own funds, issues of fact exist as to whether the fact

that plaintiff received account statements would have lead him to discover the fraud.”

CIFG Assurance North America, Inc. v. J.P. Morgan Securities LLC, 146 A D 3d 60 (1st

Dept. 2016) – “The statute of limitations for misrepresentation is six years, rendering the

claim timely [citations omitted]. Although Colon v. Banco Popular N. Am. (59 A D 3d

300, 300-301 [1st Dept. 2009]) applied a three-year statute of limitations to a

misrepresentation cause of action, that case recognized that if a misrepresentation claim

alleges fraud, as CIFG’s claim here does, a six-year period applies.”

Gerber v. Empire Scale, 147 A D 3d 1434 (4th Dept. 2017) – “‘It is axiomatic that a

cause of action for fraud does not arise where the fraud alleged relates to a breach of

contract’ [citations omitted], and ‘a fraud claim is not sufficiently stated where it alleges

that a defendant did not intend to perform a contract with a plaintiff when he made it’

[citation omitted]. Here, plaintiff’s cause of action for fraud is based upon allegations

that defendant made false representations that it was interested in purchasing plaintiff’s

business in order to gain plaintiff’s confidential information. Thus, that cause of action

fails because ‘the supporting allegations do not concern representations which are

collateral or extraneous to the terms of the parties’ agreement.’”


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Wal-Mart Stores, Inc. v. Visa U.S.A., Inc., N.Y.L.J., 1202781793571 (Sup.Ct. N.Y.Co.

2017)(Singh, J.) – “It is well-settled that ‘a claim for fraudulent inducement of contract

can be predicated upon an insincere promise of future performance only where the

alleged false promise is collateral to the contract the parties executed; if the promise

concerned the performance of the contract itself, the fraud claim is subject to dismissal as

duplicative of the claim for breach of contract’ [citation omitted]. The First Department

has held ‘collateral’ means not ‘directly related to a specific provision of the contract’”

[emphasis by the Court]. The case law from the Court of Appeals “only permit a fraud

claim where there is a misrepresentation of present material fact that is collateral to the

contract.”

BREACH OF CONTRACT

Kyer v. Ravena-Coeymans-Selkirk Central School District, 144 A D 3d 1260 (3d Dept.

2016) – “A breach of contract cause of action accrues and begins to run when the plaintiff

possesses a legal right to demand payment [citations omitted], and not when a plaintiff

actually bills a defendant.”

Elia v. Perla, 150 A D 3d 962 (2d Dept. 2017) – “‘Where, as here, the claim is for

payment of a sum of money allegedly owed pursuant to a contract, the cause of action

accrues when the plaintiff ‘possesses a legal right to demand payment’ [citations

omitted]. Since a lender who has made a loan which is repayable on demand has the

immediate legal right to demand payment upon the issuance of the loan [citations

omitted], courts have consistently held that ‘a cause of action to recover on a note which

is payable on demand accrues at the time of its execution’ [citations omitted]. Notably,

‘the statute of limitations in such cases is triggered when the party that was owed money

had the right to demand payment, not when it actually made the demand.’”

Bank of America, N.A. v. Fachlaev, N.Y.L.J., 1202754690793 (Sup.Ct. Queens Co. 2016)

(Pineda-Kirwan, J.) – “With respect to a mortgage payable in installments, separate

causes of action accrue for each installment that is not paid and the statute of limitations

begins to run on the date each installment becomes due [citations omitted]. The default

date was only the start of the statute of limitations as to the installment payment that

became due on that date. However, 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]. Where, as here, the acceleration of the debt is made optional to the holder of

the note and mortgage, some affirmative act must be taken in order to evidence the

holder’s election to accelerate the debt. Thus, the statute of limitations for the entire debt

did not begin to run until the plaintiff elected to accelerate under the acceleration clause

of the mortgage. It is undisputed that the plaintiff elected to accelerate the loan in the

complaint of the first action, which was filed on June 16, 2009. This action was not

commenced until July 16, 2015, which is more than six years after the acceleration in the

complaint and, thus, without any further action by the lender this complaint would be


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barred by the statute of limitations. A lender, however, may revoke its election to

accelerate all sums due under an optional acceleration clause in a mortgage provided that

there is no change in borrower’s position in reliance thereon. This must be done by an

affirmative act occurring within the statute of limitations period [citation omitted]. Here,

the plaintiff lender has submitted evidence that it sent a de-acceleration letter to the

borrower on April 21, 2015. This letter is sufficient on a motion to dismiss to constitute

proof raising an issue of fact as to an affirmative act of revocation.”

Bank of New York Mellon v. Smith, 54 Misc 3d 311 (Sup.Ct. Rensselaer Co. 2016)

(Zwack, J.) – “‘Although a lender may revoke its election to accelerate all sums due

under an optional acceleration clause provided there is no change in the borrower’s

position in reliance thereon’ [citation omitted], the revocation should be clear,

unequivocal, and give actual notice to the borrower of the lender's election to revoke in

sum, akin to the manner plaintiff gave notice to exercise the option to accelerate [citation

omitted] particularly where, as here, the ‘prior foreclosure action was never withdrawn by

the lender, but rather, dismissed sua sponte by the court and rather than seeking to revoke

its election to accelerate, the plaintiff made a failed attempt to revive the prior foreclosure

action.’” Here, “there is simply no merit to plaintiff’s claim that a failed 2009 trial

modification plan acted to revoke the 2006 acceleration of the subject debt. ‘The mere

acceptance of a partial payment of the accelerated debt is not an affirmative act revoking

the acceleration and thereby halting the running of the statute of limitations.’”

Goldman Sachs Mortgage Company v. Mares, 135 A D 3d 1121 (3d Dept. 2016) – “The

June 2007 default letter sent to defendants stated, in relevant part, that ‘failure to pay the

total amount past due, plus all other installments and other amounts becoming due

hereafter on or before the 30th day after the date of this letter may result in acceleration

of the sums secured by the mortgage’ [emphasis by the Court]. While the letter does

demand payment for all past due amounts, if falls far short of providing clear and

unequivocal notice to defendants that the entire mortgage debt was being accelerated

[citations omitted]. Indeed, with respect to acceleration, it is nothing more than a ‘letter

discussing a possible future event,’ which ‘does not constitute an exercise of the

mortgage’s optional acceleration clause’ [citation omitted]. Accordingly, we agree with

Supreme Court’s determination that the June 2007 letter did not commence the running

of the statute of limitations and, thus, plaintiff’s March 2014 foreclosure action is not

time-barred.”

Deutsche Bank National Trust Company v. Unknown Heirs of the Estate of Serge Souto,

N.Y.L.J., 1202763458396 (Sup.Ct. N.Y.Co. 2016)(Bluth, J.), aff’d sub nom, Deutsche

Bank National Trust Company v. Royal Blue Realty Holdings, Inc., 148 A D 3d 529 (1st

Dept. 2017) – Plaintiff claims that Souto breached the terms of a mortgage agreement by

failing to pay a June 1, 2008 installment, and subsequent installments. Plaintiff sent a

notice of default on January 15, 2009, and commenced a foreclosure action on March 17,


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2009, which was thereafter discontinued without prejudice. This foreclosure action was

commenced on March 16, 2015. Supreme Court holds that the six-year limitations period

for such an action “begins to run when the lender first has the right to foreclosure on the

mortgage, that is, the day after the maturity date of the underlying debt unless the

mortgage debt is accelerated in which case the entire amount is due and the statute of

limitations begins to run on the entire mortgage debt.” This case turns on whether the

January 15, 2009 default letter constituted such an acceleration. It stated: “If American

Home Mortgage Servicing, Inc. is not in possession of the amount that is necessary to

cure the default within 30 days of the date of this notice, American Home Mortgage

Serving, Inc. will accelerate the Loan balance and proceed with foreclosure” [emphasis

added]. “This,” says Supreme Court, “is not a wishy-washy notice.” There is “no

indication that there will be any other notices between the letter in the borrower’s hands

and the commencement of the foreclosure case. The thirty days is the last chance to

cure.” Thus, “this court finds that the January 15, 2009 notice was sufficient and the

statute of limitations began to run on the 31st day after the notice if payment was not

received. Therefore, the loan accelerated and the statute started to run on the 31st day,

February 15, 2009.” The Appellate Division has affirmed. “The motion court properly

determined that the actions are time-barred since they were commenced more than six

years from the date that all of the debt on the mortgages was accelerated [citation

omitted]. The letters from plaintiff’s predecessor-in-interest provided clear and

unequivocal notice that it ‘will’ accelerate the load balance and proceed with a

foreclosure sale, unless the borrower cured his defaults within 30 days of the letter.

When the borrower did not cure his defaults within 30 days, all sums became

immediately due and payable and plaintiff had the right to foreclose on the mortgages

pursuant to the letters. At that point, the statute of limitations began to run on the entire

mortgage debt.”

Puzzuoli v. JPMorgan Chase Bank, N.A., 55 Misc 3d 417 (Sup.Ct. Dutchess Co. 2017)

(Forman, J.) – “A mortgage is accelerated when the lender elects to exercise its right of

acceleration, not when the borrower receives notice of that election [citation omitted].

For instance, when a verified complaint contains an acceleration clause, the ‘unequivocal

act’ of filing that document in the courthouse constitutes a valid election of the right to

accelerate.” The Court rejects the lender’s argument here that “‘it is the filing and

service of the Complaint which accelerates the loan’” [emphasis by the Court]. For, “‘to

elect is to choose. The fact of election should not be confused with the notice or

manifestation of such election.’” The Court thus concludes that the acceleration occurred

when the complaint was verified, rather than the later dates when it was filed and served.

Nationstar Mortgage, LLC v. MacPherson, 56 Misc 3d 339 (Sup.Ct. Suffolk Co. 2017

(Whelan, J.) – The “notice to the borrower to accelerate the entire amount of the

mortgage debt must be ‘clear and unequivocal.’” Here, “the parties did not choose to use

the statutory form of acceleration set forth in Real Property Law §258, schedule M or N.”


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Instead, “the lender bargained away its right to demand payment in full simply upon a

default in an installment payment or the commencement of an action and has afforded the

borrower greater protections that that set forth in the statutory form of an acceleration

clause.” For, “under the express wording of the mortgage document, plaintiff has no

right to reject the borrower’s payment of arrears in order to reinstate the mortgage, until a

judgment is entered.” Thus, “under the contract terms at issue, plaintiff does not have a

legal right to require payment in full with the simple filing of a foreclosure action. The

borrower could pay the unpaid installments and the payment of same would destroy the

option to accelerate.” It is “a judgment that triggers the acceleration in full of the entire

mortgage debt.” Thus, the commencement of a prior foreclosure action did not amount to

an acceleration commencing the statute of limitations on the entire debt, and plaintiff may

have recovery of “those unpaid installments which accrued after September 17, 2008, that

is, the six-year period immediately preceding the commencement of this action.”

Lebedev v. Blavatnik, 144 A D 3d 24 (1st Dept. 2016) – When defendant had a “recurring

obligation to pay plaintiff his share of the profits generated by the joint venture,” the

failure to pay was a continuing wrong, and each failure generated its own statute of

limitations.

Affordable Housing Associates, Inc. v. Town of Brookhaven, 150 A D 3d 800 (2d Dept.

2017) – “The continuing wrong doctrine ‘is usually employed where there is a series of

continuing wrongs and serves to toll the running of a period of limitations to the date of

the commission of the last wrongful act’ [citation omitted]. The doctrine ‘may only be

predicated on continuing unlawful acts and not on the continuing effects of earlier

unlawful conduct [citations omitted]. ‘In contract actions, the doctrine is applied to

extend the statute of limitations when the contract imposes a continuing duty on the

breaching party’ [citations omitted]. Here, the alleged wrong was the Town entering into

contracts with Mid-Atlantic and, contrary to the court’s finding, there was no breach of a

recurring duty imposed on the Town under the Agreement.”

Henry v. Bank of America, 147 A D 3d 599 (1st Dept. 2017) – “The continuous wrong

doctrine is the exception to the general rule that the statute of limitations ‘runs from the

time of the breach [of contract] though no damage occurs until later’ [citation omitted].

The doctrine ‘is usually employed where there is a series of continuing wrongs and serves

to toll the running of a period of limitations to the date of the commission of the last

wrongful act’ [citation omitted]. Where applicable, the doctrine will save all claims for

recovery of damages but only to the extent of wrongs committed within the applicable

statute of limitations [citations omitted]. The doctrine ‘may only be predicated on

continuing unlawful acts and not on the continuing effects of earlier unlawful conduct.

The distinction is between a single wrong that has continuing effects and a series of

independent, distinct wrongs’ [citations omitted]. The doctrine is inapplicable where

there is one tortious act complained of since the cause of action accrues in those cases at


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the time that the wrongful act first injured plaintiff and it does not change as a result of

‘continuing consequential damages’ [citations omitted]. In contract actions, the doctrine

is applied to extend the statute of limitations when the contract imposes a continuing duty

on the breaching party [citations omitted]. Thus, where a plaintiff asserts a single breach

– with damages increasing as the breach continued – the continuing wrong theory does

not apply.”

Deutsche Bank National Trust Company v. Flagstar Capital Markets Corporation,

143 A D 3d 15 (1st Dept. 2016) – Last year’s “Update” reported on ACE Securities

Corporation v. DB Structured Products, Inc., 25 N Y 3d 581 (2015), an action for breach

of a contractual obligation “to repurchase certain non-conforming loans that were pooled,

deposited into a trust, securitized, and sold to investors.” The parties’ agreement

contained many warranties and representations by defendant, and provided that defendant

would cure any breach of a representation within 60 days of notice, or repurchase the

affected loan. Supreme Court rejected defendant’s argument that the statute of

limitations on plaintiff’s claim ran from the execution of the contract, as the

representations were false as of that moment. Instead, Supreme Court held that defendant

only breached the contract when it failed to repurchase in accordance with its obligation.

The Appellate Division reversed, holding that “the claims accrued on the closing date of

the [contract], on March 28, 2006, when any breach of the representations and warranties

contained therein occurred.” The Court of Appeals affirmed the Appellate Division.

“Where, as in this case, representations and warranties concern the characteristics of their

subject as of the date they are made, they are breached, if at all, on that date; DBSP’s

refusal to repurchase the allegedly defective mortgages did not give rise to a separate

cause of action.” For, defendant “represented and warranted certain facts about the

loans’ characteristics as of March 28, 2006, when the MLPA and PSA were executed,

and expressly stated that those representations and warranties did not survive the closing

date. DBSP’s cure or repurchase obligation was the Trust’s remedy for a breach of those

representations and warranties, not a promise of the loans’ future performance”

[emphasis by the Court]. Here, in Deutsche Bank, the facts are similar to those in ACE

Securities Corporation, except that the agreement between the parties further “included a

provision that purported to delay the accrual of a breach of contract claim until three

conditions were met. The accrual provision specified that any cause of action against

defendant relating to a breach of representations and warranties ‘shall accrue as to any

Mortgage Loan upon (i) discovery of such breach by the Purchaser or notice thereof by

the Seller to the Purchaser, (ii) failure by the Seller to cure, repurchase or substitute and

(iii) demand upon the Seller by the Purchaser for compliance with this Agreement.’” The

Court finds this provision unenforceable. “‘Statutes of limitation not only save litigants

from defending stale claims, but also “express a societal interest or public policy of

giving repose to human affairs”’ [citations omitted]. ‘Because of the combined private

and public interests involved, individual parties are not entirely free to waive or modify

the statutory defense’ [citation omitted]. Although parties may agree after a cause of


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action has accrued to extend the statute of limitations, an ‘agreement to extend the Statute

of Limitations that is made at the inception of liability will be unenforceable because a

party cannot “in advance, make a valid promise that a statute founded in public policy

shall be inoperative.”’” Moreover, enforcing this provision “would contravene the

principle that ‘New York does not apply the “discovery” rule to statutes of limitations in

contract actions [citation omitted; emphasis by the Court]. The accrual provision’s set of

conditions creates an imprecisely ascertainable accrual date – possibly occurring decades

in the future, since some of the loans extend for 30 years – which the Court of Appeals

has ‘repeatedly rejected in favor of a bright line approach.’” Finally, “the accrual

provision’s requirement that plaintiff make a demand on defendant for performance of

the agreement does not constitute a substantive condition precedent that could delay

accrual of the breach of contract action. As in ACE, plaintiff overlooks the significant

distinction between substantive and procedural demand requirements [citation omitted].

A demand ‘that is a condition to a party’s performance’ is a substantive condition

precedent, which can delay accrual of a claim, whereas ‘a demand that seeks a remedy

for a preexisting wrong’ is a procedural prerequisite to suit, which cannot” [emphasis by

the Court].

The Bank of N.Y. Mellon v. WMC Mortgage, LLC, 151 A D 3d 72 (1st Dept. 2017) – Last

year’s “Update” reported on the Supreme Court’s decision in this action [50 Misc 3d 229

(Sup.Ct. N.Y.Co. 2015)]. Supreme Court held that the date of accrual of the cause of

action provided for in ACE Securities Corporation v. DB Structured Products, Inc.,

discussed directly above, applies even in the face of a different accrual date contained in

the parties’ agreement. “There is much intuitive appeal to plaintiff’s position. Plaintiff is

basically arguing that the court should respect sophisticated parties’ express contractual

decisions with respect to accrual of their claims with the same level of deference courts

ordinarily provide to all other unambiguous contractual provisions.” However,

“intuition, as we know, does not always carry the day. The Court of Appeals has

reaffirmed this state’s longstanding public policy of providing for statute of limitations

rules that take precedence over competing contractual and equitable considerations.” The

Appellate Division, re-affirming its decision in Deutsche Bank National Trust Company

v. Flagstar Capital Markets Corporation, discussed directly above, has, as here relevant,

affirmed. “Statutes of limitations ‘express a societal interest or public policy “of giving

repose to human affairs”’ [citations omitted]. Parties may therefore agree to shorten the

time period within which to commence an action, but are not entirely free to waive or

modify the statutory defense. Thus, agreements made at the inception of liability to

waive or extent the statute of limitations are ‘unenforceable because a party cannot “in

advance, make a valid promise that a statute founded in public policy shall be

inoperative.”’”

Yarbro v. Wells Fargo Bank, N.A., 140 A D 3d 668 (1st Dept. 2016) – “Contrary to

plaintiff’s contention, the breach of contract causes of action accrued at the time of the


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breach, not on the date of discovery of the breach [citation omitted], and the six-year

statute of limitations applicable thereto had run before plaintiffs commenced this action.

The negligence claims, which allege a failure to properly record certain mortgages, are

governed by CPLR 214(4), a three-year statute of limitations [citations omitted].

‘Accrual time is measured from the day the actionable injury occurred, even though the

aggrieved party was then ignorant of the wrong or injury.’”

Nomura Asset Acceptance Corporation Alternative Loan Trust v. Nomura Credit &

Capital, Inc., 139 A D 3d 519 (1st Dept. 2016) – “The motion court erred to the extent it

found that the claims for breach of the loan representations accrued on May 1, 2006, the

date of the mortgage loan purchase agreements (MLPA) containing those representations.

While such claims typically accrue at the time the contract containing the representations

is executed [citation omitted], as the MLPA here specifically provides that defendant

made its loan representations ‘as of the Closing Date,’ which was May 25, 2006, the

claims accrued on that date and not earlier.”

Hagman v. Swenson, 149 A D 3d 1 (1st Dept. 2017) – “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.” Here, “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.” The

Court concludes 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.”

The contract “states that plaintiff will provide advice and design suggestions regarding

construction, cabinetry, painting and using the clients’ existing items. Plaintiff stated that

she designed most of the rooms throughout defendants’ Tuxedo Park house, and the

contract provides that she will select products and materials, show them to Ms. Swenson,

and then purchase them on her behalf. In addition, the contract provides that defendants

will be charged ‘List price,’ which plaintiff states is understood in the industry to include

both the cost of the materials as well as a percentage service fee. Moreover, the contract

acknowledges that certain ‘custom work’ will be done by ‘interior designers work

people,’ and a number of the invoices referenced such ‘custom made’ items. Finally,

plaintiff and Ms. Swenson also agreed that plaintiff could use and publish photographs of

the items to show off plaintiff’s work, which demonstrates that plaintiff’s value is

attributed to the selection of the various items and putting them together for a particular

scheme, not merely to her acting as a retailer.” Nor did it matter that the particular

unpaid invoices at issue in this action were mostly for goods purchased by plaintiff for

defendants. What matters is “the nature of the transaction.”


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WRONGFUL DEATH

Saintime v. Visiting Nurse Service of New York, N.Y.L.J., 1202771682877 (Sup.Ct. Kings

Co. 2016)(Silber, J.) – “‘As a general rule, pursuant to the provisions of EPTL 5-4.1, a

wrongful death action must be commenced within two years of the decedent’s death. In

addition to commencing the action within two years of decedent’s death, the decedent

must have had a viable cause of action against the defendant on the day he died. That is,

if the statute for personal injury had run at the time of decedent’s death, there is no cause

of action for wrongful death since the decedent himself would have been time-barred

from prosecuting an action had he lived. If the statute for personal injury had not run at

decedent’s death, but runs out prior to the timely commencement of a wrongful death

action, recovery can be for wrongful death only, and not personal injury. The limitations

period specifically provided for in wrongful death actions applies no matter what the

cause of death and no matter what the theory of liability.’”

INTENTIONAL TORTS

Kerzhner v. G4S Government Solutions, Inc., 138 A D 3d 564 (1st Dept. 2016) –

“Plaintiff alleges that, while visiting a Social Security Administration office concerning

his benefits, he was assaulted and thrown to the ground by a security guard, defendant

Eliot Ray, who was employed by defendants G4S and Wackenhut (the employer

defendants). On appeal, plaintiff does not challenge the dismissal of his intentional tort

and vicarious liability claims as barred by the one-year statute of limitations, but asserts

that he adequately pleaded claims sounding in negligence. Plaintiff cannot avoid the

statute of limitations by reframing his intentional tort claims as a claim based on breach

of the duty to keep the premises safe [citation omitted], especially in this case, in which

the employer defendants did not own or lease the premises. The motion court also

properly dismissed the negligent infliction of emotional distress claim, since it does not

differ from the intentional emotional distress claim, and did not adequately allege

extreme and outrageous conduct.”

Walker v. Lorch, 136 A D 3d 805 (2d Dept. 2016) – CPLR 215(8)(a) provides that

“whenever it is shown that a criminal action against the same defendant has been

commenced with respect to the event or occurrence from which a claim governed by this

section arises, the plaintiff shall have at least one year from the termination of the

criminal action as defined in section 1.20 of the criminal procedure law in which to

commence the civil action, notwithstanding that the time in which to commence such

action has already expired or has less than a year remaining.” Here, defendant’s deceased

was indicted in Massachusetts for a sexual assault upon plaintiff, but died before the

matter could be tried, leading to dismissal of the indictment. The Court rejects

defendant’s argument that CPLR 215(8) is applicable only to criminal charges brought in

New York. “The statute does not require that the underlying ‘criminal action’ be one that

was prosecuted in New York.” However, plaintiff’s claim for breach of fiduciary duty is


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not governed by CPLR 215, which only applies to intentional torts, and is therefore not

saved by CPLR 215(8).

Elliott v. Grant, 150 A D 3d 1080 (2d Dept. 2017) – CPLR 213-b provides that,

notwithstanding other time limitations, a “crime victim” may commence an action for

damages against the defendant “convicted of a crime which is the subject of such action”

up to 7 years from the commission of the crime. Here, 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.’ 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.”

LIABILITY CREATED BY STATUTE


Dept. 2016) – “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 ‘actions 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.”

People ex rel. Schneiderman v. Credit Suisse Securities (USA) LLC, 145 A D 3d 533 (1st

Dept. 2016) – Last year’s “Update” reported on the Supreme Court decision in this action

[N.Y.L.J., 1202717344324 (Sup.Ct. N.Y.Co. 2014)]. This is an action seeking injunctive

relief and damages on a claim that defendant violated the Martin Act [General Business

Law §352 et seq.] by having “committed fraudulent and deceptive acts in connection with

the creation and sale of residential mortgage-backed securities.” Defendant claims that

the 3-year statute of limitations provided by CPLR 214(2) governs, as the action seeks to

recover on a liability created by statute. Plaintiff argues that the 6-year fraud statute of

limitations, provided by CPLR 213(8) applies. Supreme Court held that, “it is well

settled that ‘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”’

[citations omitted]. Where the statute codifies or implements liabilities existing at

common law, ‘the Statute of Limitations for the statutory claim is that for the common-

law cause of action.’” And, “as the Court of Appeals has made clear, where a statute

does not ‘make unlawful the alleged fraudulent practices, but only provides standing in

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which pre-existed the statute,’ such a statute does ‘not create or impose new

obligations.’” Defendant argues that, here, the Martin Act claims are “substantially

different from claims cognizable at common-law,” since, under the statute, plaintiff “need

not plead two of the ‘hallmark’ elements of common-law fraud – namely, scienter and

reliance.” But “the cases do not hold that liability is imposed by statute, and that

application of CPLR 214(2) is required, whenever there is a divergence between the

elements of a common-law claim and the elements of the statutory claim.” Instead, “a

court must look to the essence of the claim, and not to the form in which it is pleaded, to

determine whether a liability was recognized by the common-law or is imposed by

statute.” Here, “the essence of plaintiff’s claims” is “that defendants made false

representations in order to induce investors to purchase their securities. These claims

thus seek to impose liability on defendants based on the classic, longstanding common-

law tort of investor fraud.” Supreme Court accordingly held that, “even in the absence of

allegations of scienter, the claims are subject to the six year statute of limitations.” A

narrowly-divided Appellate Division has affirmed. The majority holds that the statutes at

issue do not “encompass a significantly wider range of fraudulent activities than were

legally cognizable before the section’s enactment,” and that “the conduct at issue in this

action was, in fact, always subject to granting of relief under the courts’ equitable

powers.” For, the statutes “target wrongs that existed before the statutes’ enactment, as

opposed to targeting wrongs that were not legally cognizable before enactment.”

Moreover, “contrary to the dissent’s conclusion, the complaint sets forth the elements of

common-law fraud, including scienter or intent, reliance, and damages. The allegations

in the complaint describe a specific scheme whereby Credit Suisse ‘benefited itself at the

expense of investors.’ As the trial court correctly found, ‘these claims seek to impose

liability on Credit Suisse based on the classic, longstanding common-law tort of investor

fraud,’ thus invoking a six-year statute of limitations.” The dissenters argued that the

claims “as pleaded, fall within the category of claims that would not exist but for the

statutes, creating a new basis for liability, not a new remedy, and the three year statute of

limitations of CPLR 214(2) applies.” For, “none of the allegations of the complaint

accuses defendants of knowingly or recklessly misrepresenting a fact to an investor in

order to deceive that investor.” Thus, “the claim would not exist at common-law because

it makes ‘actionable conduct that does not necessarily rise to the level of fraud.’”

BREACH OF FIDUCIARY DUTY

Matter of Argondizza v. Argondizza, 137 A D 3d 670 (1st Dept. 2016) – A prior year’s

“Update” reported on DiRaimondo v. Calhoun, 131 A D 3d 1194 (2d Dept. 2015), in

which the Second Department reiterated that “‘New York law does not provide a single

statute of limitations for breach of fiduciary duty claims. Rather, the choice of the

applicable limitations period depends on the substantive remedy that the plaintiff seeks.

Where the remedy sought is purely monetary in nature, courts construe the suit as

alleging ‘injury to property’ within the meaning of CPLR 214(4), which has a three-year


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limitations period. Where, however, the relief sought is equitable in nature, the six-year

limitations period of CPLR 213(1) applies’ [citation omitted]. ‘Where an allegation of

fraud is essential to a breach of fiduciary duty claim, courts have applied a six-year

statute of limitations under CPLR 213(8)’ [citations omitted]. ‘An exception to this rule

is that “courts will not apply the fraud Statute of Limitations if the fraud allegation is only

incidental to the claim asserted; otherwise, fraud would be used as a means to litigate

stale claims”’ [citations omitted]. ‘Thus, where an allegation of fraud is not essential to

the cause of action pleaded except as an answer to an anticipated defense of Statute of

Limitations, courts look for the reality, and the essence of the action and not its mere

name.’” Here in Argondizza, the First Department concluded that, “the motion court

correctly concluded that the amended petition stated a claim for breach of fiduciary duty

that sought an equitable remedy – namely, a constructive trust and a return of decedent’s

interest in the apartment [citation omitted], and that the claim was timely under the

applicable six-year statute of limitations [citations omitted]. The statute of limitations did

not begin to run until respondent allegedly openly repudiated his fiduciary obligations by

transferring decedent’s interest in the apartment to himself.”

Cusimano v. Schnurr, 137 A D 3d 527 (1st Dept. 2016) – “‘A cause of action for breach

of fiduciary duty based on allegations of actual fraud is subject to a six-year limitations

period’ [citations omitted]. An exception to this rule exists ‘if the fraud allegation is only

incidental to the claim asserted’ [citations omitted]. Thus, ‘where an allegation of fraud

is not essential to the cause of action pleaded except as an answer to an anticipated

defense of Statute of Limitations, courts look for the reality, and the essence of the action

and not its mere name.’”

ACCRUAL AND LIMITATION PERIODS

Swain v. Brown, 135 A D 3d 629 (1st Dept. 2016) – “Under CPLR 214(3), the statutory

period of limitations for conversion and replevin claims is three years from the date of

accrual. The date of accrual depends on whether the current possessor is a good faith

purchaser or bad faith possessor. An action against a good faith purchaser accrues once

the true owner makes a demand and is refused [citation omitted]. This is ‘because a

good-faith purchaser of stolen property commits no wrong, as a matter of substantive

law, until he has first been advised of the plaintiff’s claim to possession and given an

opportunity to return the chattel’ [citation omitted]. By contrast, an action against a bad

faith possessor begins to run immediately from the time of wrongful possession, and does

not require a demand and refusal [citations omitted]. Thus, ‘where replevin is sought

against the party who converted the property, the action accrues on the date of

conversion.’”

Beck v. Christie’s Inc., 141 A D 3d 442 (1st Dept. 2016) – “Generally, a cause of action

accrues, thereby triggering the statute of limitations, ‘when all of the factual

circumstances necessary to establish a right of action have occurred, so that the plaintiff


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would be entitled to relief’ [citation omitted]. New York courts have applied CPLR

214(2)’s three-year period of limitations for statutory causes of action to General

Business Law §349 claims [citation omitted]. ‘The statute runs from the time when the

plaintiff was injured.’”

Setters v. AI Properties and Developments (USA) Corp., 139 A D 3d 492 (1st Dept.

2016) – “The three-year limitation period imposed by LLCL §508(c) does not override

the six-year statute of limitations for fraudulent conveyance claims brought under the

D[ebtor and] C[reditor] L[aw], since the plain language of section 508 indicates that the

statute applies to members of an LLC, holding them ‘liable to the limited liability

company’ for wrongful distributions’ [citations omitted]. The statute does not address

the claims of outside creditors.”

461 Broadway, LLC v. Village of Monticello, 144 A D 3d 1464 (3d Dept. 2016) – “To the

extent that plaintiff’s claim alleges that defendant negligently constructed and installed

the water and sewer main – work which was fully complete by December 2009 – we

agree with Supreme Court that it cannot be maintained.” For, “although plaintiff alleges

ongoing injury to its property as a result of defendant’s actions, the alleged tortious

conduct in that regard consisted of discrete acts of negligence that ceased upon

completion of the water and sewer main construction.” However, “we reach a different

conclusion with respect to plaintiff’s alternative claim that defendant failed to properly

maintain and/or repair its sewer and water mains. It is settled that a municipality is under

a continuing duty to maintain and repair its sewage and water systems [citations omitted],

and this duty is independent of the duty not to create a dangerous or defective condition.”

Thus, “defendant’s negligence, if any, in failing to maintain or repair its water and/or

sewage system constitutes a continuing wrong that gives rise to a new cause of action for

each injury that occurred.”

Mogul Media, LLC v. Ramsburgh, 150 A D 3d 487 (1st Dept. 2017) – “‘In cases against

architects or contractors, the accrual date for Statute of Limitations purposes is

completion of performance. No matter how a claim is characterized in the complaint –

negligence, malpractice, breach of contract – an owner’s claim arising out of defective

construction accrues on date of completion, since all liability has its genesis in the

contractual relationship of the parties.’”

Cahill v. State of New York Stony Brook University Hospital, 139 A D 3d 779 (2d Dept.

2016) – “Causes of action alleging violations of Executive Law §296 are governed by a

three-year statute of limitations [citations omitted]. While a cause of action alleging

discrimination on the basis of discrete adverse employment actions is timely only to the

extent that the adverse employment actions took place within the statute of limitations

period, a cause of action alleging hostile work environment is timely so long as one act

contributing to the cause of action occurred within the statute of limitations period.”


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Cruz v. City of New York, 148 A D 3d 617 (1st Dept. 2017) – “The three-year limitations

period on a [42 USC] section 1983 claim based on false arrest begins to run ‘when the

alleged false imprisonment ends’ – that is, when the arrestee becomes subject to the legal

process such as being ‘bound over by a magistrate or arraigned on charges.”

Matter of the City of New York (South Richmond Blue Belt, Phase 3), 141 A D 3d 672 (2d

Dept. 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.”

CONTRACTUAL LIMITATIONS PERIODS

D&S Restoration, Inc. v. Wenger Construction Co., Inc., 54 Misc 3d 763 (Sup.Ct. Nassau

Co. 2016)(Maron, J.) – Plaintiff was a subcontractor, and defendant the general

contractor, on a construction project for the New York City School Construction

Authority (“SCA”). The contract between the parties provides that “no action or

proceeding shall lie or shall be maintained by Subcontractor against Contractor, CM or

Owner unless such action shall be commenced within one (1) year after Substantial

Completion of Subcontractor’s work herein.” Plaintiff last furnished labor or material on

June 11, 2012. The SCA certified the project as substantially complete as of October 5,

2012. The SCA signed off on the completed work in December 2012. But it did not sign

off on the credits until June 24, 2016. Thus, payment did not become due to plaintiff

until that date. The Court rejects plaintiff’s argument that, under the circumstances, the

contractual statute of limitations was unreasonable and unenforceable. For, “what is

dispositive is that plaintiff was aware, or should have been aware, meaning it was

foreseeable, that final negotiations in public projects such as the one at issue here, can

and typically do take an extended period of time after the certification of substantial

completion.” Since these conditions “were simply not unforeseeable or unanticipated,”

the “doctrine of impossibility simply cannot be applied here.”

ACKNOWLEDGEMENT AND PART PAYMENT

PSP-NC, LLC v. Raudkivi, 138 A D 3d 709 (2d Dept. 2016) – “Raudkivi contends that

this mortgage foreclosure action is barred by the applicable six-year statute of limitations

[citation omitted]. He notes that the statute of limitations began to run in October 2001,

when Greenpoint accelerated the debt and commenced the first action to foreclose the

mortgage [citations omitted], and that the limitations period was tolled by the automatic

bankruptcy stay when he filed his bankruptcy petition in October 2002 [citations

omitted]. He contends that the limitations period began to run again when he was granted

his discharge in bankruptcy in October of 2006 [citation omitted], and ended in October

2011, by virtue of the one-year period between accrual of the claim in 2001 and the

beginning of the bankruptcy stay in 2002. However, Raudkivi’s Chapter 13 bankruptcy


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plan, in which he acknowledged the mortgage debt and promised to repay it, renewed the

limitations period [citations omitted]. The automatic bankruptcy stay, which was in

effect when Raudkivi executed his Chapter 13 bankruptcy plan, tolled the renewed

limitations period [citations omitted], so the renewed limitations period did not begin to

run until Raudkivi was granted his discharge in bankruptcy in October of 2006 [citation

omitted]. Since this action was commenced less than six years later, in July of 2012, this

action is not time-barred.”

U.S. Bank National Association v. Martin, 144 A D 3d 891 (2d Dept. 2016) – “In order to

demonstrate that the statute of limitations has been renewed by a partial payment, it must

be shown that the payment was ‘accompanied by circumstances amounting to an absolute

and unqualified acknowledgment by the debtor of more being due, from which a promise

may be inferred to pay the remainder’ [citations omitted]. Here, because the plaintiff

asserts that the payment was made as a condition to receiving an extension of a

bankruptcy stay, the payment did not constitute an unqualified acknowledgment of the

debt or manifest a promise to pay the remainder [citations omitted]. Moreover, the

payment history did not show by whom the payment was made, and thus, did not prove

that it was made by the debtor.”

The Bank of New York Mellon v. Bissessar, N.Y.L.J., 1202771804024 (Sup.Ct. Queens

Co. 2016)(Elliot, J.) – In this mortgage foreclosure action, plaintiff had accelerated the

debt by the commencement of an earlier action – later voluntarily discontinued – in 2008.

This action was commenced more than 6 years later. Plaintiff opposes defendant’s

motion to dismiss on grounds of statute of limitations by first urging that defendant made

a payment during the running of the limitations period, which caused the statute to run

anew. “In support, plaintiff annexes a paper to which its counsel refers as a copy of ‘the

business record, which makes evident that the “last pmt” made by Defendant was

received for this loan account was June 21, 2010 [sic].’ The exhibit consists of an

apparent photocopy of a computer screen shot entitled ‘Customer /Loan Inquiry’ which

indicates, inter alia, defendant as the borrower, the property address, and a ‘Last Pmt’ of

‘06/21/10.’ First, this document cannot be properly authenticated by counsel, and does

not qualify as competent evidence of any payment. But, in any event, even if competent,

it would not establish a “part payment” exception to the statute of limitations. “‘In order

that a part payment shall have the effect of tolling a time-limitation period, under the

statute or pursuant to a contract, it must be shown that there was a payment of a portion

of an admitted debt, made and accepted as such, accompanied by circumstances

amounting to an absolute and unqualified acknowledgment by the debtor of more being

due, from which a promise may be inferred to pay the remainder.’” And, here, “plaintiff

has provided nothing further to establish these additional requisite facts in opposition to

defendant’s motion, particularly those facts which would suggest defendant’s ‘absolute

and unqualified acknowledgment’ that more was due under the loan such that the

limitations period would have been renewed as of that date.” The Court also rejects


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plaintiff’s second argument, that defendant “re-acknowledged” the debt by sending a

“hardship letter” to plaintiff’s loan servicer, requesting a reduction in interest rate. The

letter does not “expressly and unconditionally” promise to pay the debt. It simply asked

for a loan modification. Thus while the letter may have, “arguably, acknowledged the

existing mortgage debt,” it was “accompanied by a condition precedent, to wit: the

preparation and execution of a modification agreement.” Accordingly, “any promise to

pay was conditional and, therefore, ineffectual to run the limitations period anew.”

U.S. Bank National Association v. Martinez, 2016 WL 7381807 (Sup.Ct. Kings Co.

2016)(Jimenez-Salta, J.) – To avoid the bar of the statute of limitations, plaintiff-

mortgagee argues that payments made by defendant-borrower as the result of a federal

Home Affordable Modification Program (HAMP) trial, constituted an acknowledgment

of the debt or partial payment, sufficient to re-start the running of the statute of

limitations. The Court disagrees. Such an acknowledgment requires “an express promise

to pay the mortgage debt.” And “a HAMP modification trial is ‘not an agreement for the

binding obligation of the parties going forward’ because it is ‘merely a trial

arrangement.’” And, here, the HAMP trial “does not contain Martinez’s express

acknowledgement of his indebtedness under the Freemont Mortgage and Note or

Martinez’s express promise to pay any of the outstanding debt. Instead, Martinez made a

conditional promise to make three payments” based on the servicer’s agreement “to

‘suspend any scheduled foreclosure sale’ during the three-month 2009 HAMP Trial

period during which it promised to review Martinez’s documented income to determine

whether Martinez qualified for a final HAMP modification.” And, “equally unavailing is

US Bank Trustee’s theory that the Statute of Limitations was tolled and/or renewed by

partial payments that were made under the 2009 Forbearance Plan. US Bank Trustee has

utterly failed to satisfy its burden of proving that Martinez made partial payments under

the 2009 Forbearance Plan ‘accompanied by circumstances amounting to an absolute and

unqualified acknowledgment by the debtor of more being due’”[emphasis by the Court].

Maidman Family Parking, LP v. Wallace Industries, Inc., 145 A D 3d 1165 (3d Dept.

2016) – “‘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 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.”


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ESTOPPEL

Picard v. Fish, 139 A D 3d 1331 (3d Dept. 2016) – “The doctrine of equitable estoppel

applies where a defendant’s fraudulent or deceptive conduct induces a plaintiff to refrain

from filing a timely action [citations omitted]. Here, plaintiffs’ only allegation that

defendant dissuaded them from bringing a timely action by affirmatively misrepresenting

her status as sole owner of the property is that, in 2010, plaintiff David Picard questioned

defendant about a ‘For Sale’ sign on a portion of the property. Defendant is alleged to

have responded that she was attempting to sell it because ‘we don’t use it and if we sell it

the three of us would be able to benefit financially.’ Even assuming the truth of this

allegation, the interaction occurred 22 years after defendant took title to the property,

making it irrelevant to plaintiffs’ failure to commence a timely action challenging the

validity of the 1988 conveyance.” The Court recognized that “‘concealment without

actual misrepresentation may form the basis for invocation of the doctrine of equitable

estoppel if there was a fiduciary relationship which gave the defendant an obligation to

inform the plaintiff of facts underlying the claim.’” But the majority of this closely-

divided Court found a lack of evidence of such a relationship, noting that “the evidence

of a familial relationship does not equate to a fiduciary relationship for equitable estoppel

purposes.” The dissenters agreed that a familial relationship, by itself, was insufficient to

create a fiduciary relationship, but argued that “plaintiff has averred facts sufficient to

support an alternate grounds for potentially finding a fiduciary relationship, arising from

the parties’ operation of a family business located upon the subject real property.”

Bacon v. Nygard, 140 A D 3d 577 (1st Dept. 2016) – “Plaintiff failed to establish that the

doctrine of equitable estoppel bars defendants from asserting a statute of limitations

defense to his time-barred defamation claims. He contends that defendants’ fraud and

misrepresentations prevented him from discovering defendants’ identity – not that he

‘was lulled into inaction by defendants in order to allow the statute of limitations to

lapse.’”

Beck v. Christie’s Inc., 141 A D 3d 442 (1st Dept. 2016) – “A defendant is estopped from

raising a statute of limitations defense to a cause of action under General Business Law

§349, where the plaintiff has alleged ‘both the tort that was the basis of the action and

later acts of deception’ that prevented the plaintiff from bringing a timely lawsuit

[citation omitted]. ‘The later fraudulent misrepresentation must be for the purpose of

concealing the former tort’ [citation omitted]. It is ‘fundamental to the application of

equitable estoppel for plaintiffs to establish that subsequent and specific actions by

defendant somehow kept them from timely bringing a suit.’” That defendant refused to

release, or concealed, information relevant to plaintiffs’ claim does not create an estoppel

when that conduct did not prevent them from commencing an action.

Botach Management Group v. Gurash, 138 A D 3d 771 (2d Dept. 2016) – “‘Evidence of

communications or settlement negotiations between an insured and its insurer either


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before or after expiration of a limitations period contained in a policy is not, without

more, sufficient to prove waiver or estoppel.’”

Cusimano v. Schnurr, 137 A D 3d 527 (1st Dept. 2016) – “Where the same alleged

wrongdoing that underlines the plaintiffs’ equitable estoppel argument is also the basis of

their tort claims, equitable estoppel will not lie [citation omitted]. Here, equitable

estoppel is inapplicable because the alleged fraudulent concealment forms the basis of

both plaintiff’s estoppel argument and the underlying claims.”

State of New York Workers’ Compensation Board v. Wang, 147 A D 3d 104 (3d Dept.

2017) – “Equitable estoppel may be invoked to defeat a statute of limitations defense so

long as the plaintiff establishes that it ‘was induced by fraud, misrepresentations or

deception to refrain from filing a timely action’ [citation omitted], and ‘that it was

diligent in commencing the action “within a reasonable time after the facts giving rise to

the estoppel have ceased to be operational”’ [citations omitted]. However, ‘equitable

estoppel does not apply where the misrepresentation or act of concealment underlying the

estoppel claim is the same act which forms the basis of the plaintiff’s underlying

substantive causes of action.’”

THE RELATION BACK DOCTRINE

Moezinia v. Ashkenazi, 136 A D 3d 990 (2d Dept. 2016) – “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]. The relation-back doctrine is

inapplicable where the original allegations did not provide the defendant notice of the

need to defend against the allegations of the amended complaint [citation omitted]. Here,

the plaintiff’s causes of action, as alleged in his initial complaint, were based on a written

agreement between Ashkenazi and the plaintiff, which was entered into on February 16,

2006, while the plaintiff’s causes of action, as alleged in the amended complaint, were

based on an alleged oral agreement entered into between the plaintiff and ABS at the

closing held on June 29, 2006. As the allegations contained in the initial complaint did

not provide ABS with notice of the need to defend against the allegations of the amended

complaint, the relation-back doctrine was inapplicable.”

Cady v. Springbrook NY, Inc., 145 A D 3d 846 (2d Dept. 2016) – Plaintiff’s original

complaint alleged that defendant facility negligently failed to supervise the person on

whose behalf the action was brought, resulting “in A.M.’s ingestion of multiple foreign

objects.” Now, after the running of the statute of limitations, plaintiff seeks to amend the

complaint to plead “intimidation by other residents; physical and psychological abuse

from staff members; failure to properly administer medication; causing A.M. to undergo

unauthorized and inappropriate medical treatment without informed consent; negligently


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administering an unauthorized influenza vaccination; and failure to implement A.M.’s

Individualized Education Plan.” The original complaint did not give adequate notice of

the claims sought to be added by the amendment. Therefore, they “did not relate back to

the original complaint and were, therefore, time-barred.”

Philadelphia Indemnity Insurance Company v. Citadel Services, Inc., N.Y.L.J.,

1202759880893 (Sup.Ct. Chautauqua Co. 2016)(Sedita, J.) – In this action against a

plumbing contractor for property damage resulting from allegedly negligent installation

of a steam pipe, plaintiff has insisted throughout the litigation that its claim is for

negligence, not breach of contract. Now, in the face of a motion to dismiss on statute of

limitations grounds, plaintiff cross-moves to amend the complaint to assert a breach of

contract cause of action. Plaintiff argues that the relation back doctrine should apply

because “the ‘same essential facts underpin’ both the original complaint’s negligence

claim and the proposed amended complaint’s breach of contract claim. Such an

argument overlooks the fact that plaintiff affirmatively and repeatedly advised the

defendant that it was pursuing a negligence claim only. Moreover, plaintiff did not

merely neglect to mention its breach of contract theory; to the contrary, it represented that

there was no contract between the parties. Clearly, the allegations of the original

complaint, as well as its companion pleadings, did not provide defendant with notice of

the need to defend against the allegations of the proposed amended complaint.”

Balanoff v. Doscher, 140 A D 3d 995 (2d Dept. 2016) – CPLR 203(d) “allows a

defendant to assert an otherwise untimely claim which arose out of the same transactions

alleged in the complaint, but only as a shield for recoupment purposes, and does not

permit the defendant to obtain affirmative relief [citations omitted]. The defendant’s

counterclaim alleging legal malpractice relates to the plaintiff’s performance under the

same retainer agreement pursuant to which the plaintiff would recover, and therefore this

counterclaim falls within the permissive ambit of CPLR 203(d) [citations omitted].

However, the counterclaim is permitted only to the extent that it seeks to offset any award

of legal fees to the plaintiff and not to the extent that it seeks affirmative relief.”

Kim v. Sim, N.Y.L.J., 1202773437858 (Sup.Ct. N.Y.Co. 2016)(Rakower, J.) – “‘Under

New York law, counterclaims are deemed timely if they were timely when the complaint

was initially brought [citation omitted], and are said to “relate back” to the original claim’

[citation omitted]. However, where a counterclaim is raised for the first time in an

amended answer, the relation back doctrine does not apply and the statute of limitations

is not tolled, unless the claim arises from the same transaction on which the plaintiff’s

claim is based.”

Beach v. Touradji Capital Management LLC, 142 A D 3d 442 (1st Dept. 2016) – CPLR

203(f) also applies to amendments of counterclaims. The amendment “relates back to the


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original counterclaims” so long as those original counterclaims gave adequate “notice” of

the claims asserted in the amendments.

Mitchell v. Olar, 138 A D 3d 1490 (4th Dept. 2016) – “CPLR 203(d) provides that ‘a

defense or counterclaim is not barred if it was not barred at the time the claims asserted in

the complaint were interposed.’ That section applies to cross claims as well as to

counterclaims [citation omitted]. Thus, although [defendant] Crisafulli did not answer

the complaint until after the limitations period had expired, we conclude that ‘the cross

claim was not barred by the statute of limitations as that claim was viable at the time the

underlying action was commenced’ [citations omitted]. Moreover, because Crisafulli’s

cross claim was viable at the time the underlying action was commenced, there is no need

to consider whether the cross claim arose out of the same transaction or occurrence as the

claim asserted in the complaint [citations omitted]. Indeed, the cross claim is

‘recoverable in full regardless of whether it is related to the transaction or occurrence

underlying plaintiff’s claim.’”

Town of North Hempstead v. County of Nassau, 149 A D 3d 1134 (2d Dept. 2017) –

“Pursuant to CPLR 203(d), a time-barred [counter] 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.”

DEFENDANTS “UNITED IN INTEREST”

Moran v. JRM Contracting, Inc., 145 A D 3d 1584 (4th Dept. 2016) – The Courts have

established a three-part test to determine if defendants are “united in interest,” thereby

permitting timely commencement of an action against one to be timely against the other

pursuant to CPLR 203(c). The test was first enunciated in Brock v. Bua, 83 A D 2d 61

(2d Dept. 1981), and adopted by the Court of Appeals in Mondello v. New York Blood

Center, 80 N Y 2d 219 (1992). To be united in interest, the parties’ liability must arise

out of the same conduct, the relationship between them must be such that neither has a

defense the other lacks [in Mondello, the Court appeared to hold that this branch of the

test is only met when the liability of one of the parties is vicarious], and, as modified by

the Court of Appeals in Buran v. Coupal, 87 N Y 2d 173 (1995), the third test is that the

late sued defendant knew or should have known that plaintiff only failed to timely sue it

by “mistake.” Here, in Moran, plaintiff initially commenced a breach of contract action

against “James Madalena, d/b/a JRM Construction.” However, JRM is a corporate entity,

and Madalena’s motion to dismiss on the ground that he was not a party to the contract

was granted. Three months later, but after the statute of limitations had run, plaintiff re-

commenced the action against the proper defendant. “Contrary to plaintiff’s contention,

the relation back doctrine does not apply herein [citation omitted]. ‘The relation back

doctrine allows a claim asserted against a defendant in an amended filing to relate back to


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claims previously asserted against a codefendant for statute of limitations purposes where

the two defendants are “united in interest”’ [citations 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 [below], the relation back doctrine cannot be ‘bootstrapped onto CPLR 205(a).’”

Mileski v. MSC Industrial Direct Co., Inc., 138 A D 3d 797 (2d Dept. 2016) – “‘In a

negligence action, “the defenses available to two defendants will be identical, and thus

their interests will be united, only where one is vicariously liable for the acts of the

other”’ [citations omitted]. ‘The fact that two defendants may share resources such as

office space and employees is not dispositive. They must also share exactly the same

jural relationship in the subject action.’”

Higgins v. City of New York, 144 A D 3d 511 (1st Dept. 2016) – In this action pursuant to

42 U.S.C. §1983, arising out of an alleged false arrest and use of excessive force by

defendant’s police officer employees, plaintiff seeks, after the running of the 3-year

statute of limitations applicable to such actions, to amend the complaint to add the

involved police officers as defendants. The Court denies the application. “The

requirement of unity of interest is ‘more than a notice provision’ [citation omitted]. The

test is whether ‘the interest of the parties in the subject-matter is such that they stand or

fall together and that judgment against one will similarly affect the other’ [citation

omitted]. Thus, unity of interest will not be found unless there is some relationship

between the parties giving rise to the vicarious liability of one for the conduct of the other

[citations omitted]. Unity of interest fails if there is a possibility that the new defendants

may have a defense unavailable to the original defendants.” Here, “the City cannot be

held vicariously liable for its employees’ violations of 42 U.S.C. §1983. Rather, the City

can be held liable under 42 U.S.C. §1983 only for violating that statute through an

unconstitutional official policy or custom [citations omitted]. Thus, it simply cannot be

said that the fortunes in this action of the City and of either Office Crocitto or Officer

Palmerini ‘stand or fall together and that judgment against one will similarly affect the

other’ [citation omitted]. Because the City has no vicarious liability for Officers

Crocitto’s and Palmerini’s alleged misconduct under 42 U.S.C. §1983, the two officers

are not united in interest with the City with respect to the federal false arrest and

excessive force claims against them, and the interposition of those claims against the

officers does not relate back to the commencement of the action against the City for

purposes of the statute of limitations.”

Branch v. Community College of the County of Sullivan, 148 A D 3d 1410 (3d Dept.

2017) – “It is not clear that the relation back doctrine, which ‘allows a claim asserted

against a defendant in an amended filing to relate back to claims previously asserted


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against a codefendant for statute of limitations purposes where the two defendants are

“united in interest,”’ applies to claims asserted in a new and independent action.” In any

event, here, plaintiff failed to timely sue the current defendant because of a mistake of

law – a “belief that defendant ‘was a department of the [timely-sued] county.’” A

mistake of law is “not the type of mistake contemplated by the relation back doctrine.”

Gil v. City of New York, 143 A D 3d 572 (1st Dept. 2016) – The third prong of the test for

united in interest is only applicable when the failure to timely name the late-sued

defendant is the result of a “mistake.” And, “a mistake of law is not the type of mistake

contemplated by the doctrine.” Here, plaintiff named and served only the New York City

Department of Parks and Recreation, and now seeks to add the City of New York as a

defendant. But plaintiff’s mistaken belief “that Parks was an entity subject to suit” is a

mistake of law, and plaintiff cannot get the benefit of the united in interest relation back

doctrine.

Berkeley v. 89th Jamaica Realty Company, L.P., 138 A D 3d 656 (2d Dept. 2016) – “The

plaintiff failed to satisfy the third condition [for united in interest], which required proof

that the new party knew or should have known that, but for an excusable mistake by the

plaintiff as to the identify or the proper parties, the action would have been brought

against it as well’” [emphasis added]. The Court cited Buran v. Coupal, 87 N Y 2d 173

(1995), which specifically held that the mistake need not be excusable.

TOLLS GENERALLY

Billiard Balls Management, LLC v. Mintzer Sarowitz Zeris, 54 Misc 3d 936 (Sup.Ct.

N.Y.Co. 2016)(Edmead, J.) – “While it is well established that a court may not extend a

Statute of Limitations or invent tolling principles, some tolling provisions are based upon

common-law, equitable doctrines [citations omitted]. Whenever some paramount

authority prevents a person from exercising his legal remedy, the time during which he is

thus prevented is not to be counted against him in determining whether the statute of

limitations has barred his right, even though the statute makes no specific exception in his

favor in such cases.” In this legal malpractice action, plaintiff claims that defendant law

firm permitted a default to be taken against plaintiff in an earlier action. That default was

then vacated by nisi prius, but was restored by the Appellate Division’s reversal. The

Court recognizes that a cause of action for malpractice accrues at the moment of the

malpractice, and that “accrual ‘is not delayed until the damages develop or become

quantifiable or certain.’” But, “contrary to the Firm’s contention, the Statute of

Limitations may be tolled as against a person unable to bring an action based on a prior

ruling.” Here, when the Trial Court vacated the default, plaintiff was “foreclosed from

exercising any legal remedy” against defendant. “Such order excused Billiard’s default,

thereby eliminating any actionable injury suffered by Billiard, and suspended the statute

of limitations until such injury was revived” by the Appellate Division reversal. “In other

words, Billiard no longer had a claim for malpractice upon the date of the Trial Court


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order. The Trial Court compelled [the] plaintiff [in the underlying action] to accept

Billiard’s answer, thereby nullifying Billiard’s default, and Billiard was restored to its

pre-default position in the underlying action. At such time, and notwithstanding that the

malpractice claim had already accrued, Billiard no longer had a complete cause of action.

As the statute of limitations was tolled” from the Trial Court’s order to the Appellate

Division reversal, the instant action was timely filed.

Britt v. Nestor, 145 A D 3d 544 (1st Dept. 2016) – CPLR 203(e) provides that “where a

defendant has served an answer containing a defense or counterclaim and the action is

terminated because of the plaintiff’s death or by dismissal or voluntary discontinuance,

the time which elapsed between the commencement and termination of the action is not a

part of the time within which an action must be commenced to recover upon the claim in

the defense or counterclaim or the time within which the defense or counterclaim may be

interposed in another action brought by the plaintiff or his successor in interest”

[emphasis added]. Here, “resolution of this appeal turns on the meaning of ‘termination

of the action’ as used in CPLR 203(e). We hold that a prior action terminates for

purposes of CPLR 203(e) when a nondiscretionary appeal, or an appeal taken as of right,

is exhausted. This is consistent with how the Court of Appeals has interpreted analogous

tolling statutes.”

THE “INSANITY” TOLL

Liberatore v. Greuner, 55 Misc 3d 361 (Sup.Ct. N.Y.Co. 2016)(Schlesinger, J.) – The

complaint alleges that defendant doctor committed malpractice by deliberately causing

plaintiff to become addicted to Demerol, in effect becoming her “drug dealer.” Her claim

is time-barred, unless saved by the “insanity” toll provided by CPLR 208. She provided

various affidavits attesting to her mental capacity during that period. But “against all of

this testimony is the fact that plaintiff was able to file for and navigate, however

inexpertly, a bankruptcy proceeding during the period for which she seeks a toll. In fact,

the bankruptcy judge found that Liberatore had the capacity to testify at a trial in the

bankruptcy proceedings in 2013. The bankruptcy judge noted, in her memorandum

opinion denying Liberatore a discharge of her debts, that ‘when she testified, she was

coherent and articulate.’” Courts have “long narrowly interpreted the toll for insanity

under CPLR 208.” And this “is not a good case to stretch the toll for insanity in CPLR

208 past its traditionally narrow construction.”

Vasilatos v. Dzamba, 148 A D 3d 1275 (3d Dept. 2017) – In this lead-paint ingestion

action, plaintiff simultaneously argued that she had legal capacity to sue, and that she was

entitled to the “insanity” toll under CPLR 208. The Court found that she had standing,

and rejected application of the insanity toll. “It is significant that at no point did

plaintiff’s counsel seek the appointment of a guardian ad litem pursuant to CPLR 1201,

which mandates such appointment for ‘an adult incapable of adequately prosecuting or

defendant his or her rights.’ Moreover, by her own submission, plaintiff has


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affirmatively demonstrated her ability to participate in this action. Plaintiff submitted her

two sworn affidavits – asserting in one that she ‘had never been adjudicated incompetent’

– and she never asserted that she lacks the capacity to function in society [citation

omitted]. In effect, plaintiff maintained that she has the legal capacity to pursue this

action, but was otherwise insane for purposes of tolling the statute of limitations. Simply

put, plaintiff cannot have it both ways, and we conclude that plaintiff’s reliance on the

toll provided by CPLR 208 is baseless.”

THE “DEATH” TOLL

Saintime v. Visiting Norse Service of New York, 1202771682877 (Sup.Ct. Kings Co.

2016)(Silber, J.) – CPLR 210(a) provides that “where a person entitled to commence an

action dies before the expiration of the time within which the action must be commenced

and the cause of action survives, an action may be commenced by his representative

within one year after his death.” The correct interpretation of this provision is that the

toll runs one year from the date of death “unless the decedent would have had a longer

period of time to sue, had she not died. The statutory toll cannot shorten the statute of

limitations. It is only applicable in situations where the claimant dies with less than one

year remaining for the relevant period of limitations.” Here, plaintiff’s claim sounds

either in negligence or medical malpractice. Plaintiff was last seen by defendant on May

1, 2013, and died on February 3, 2015. “Thus, with the toll in CPLR 210(a), the statute

ran on February 3, 2016, one year after the date of death, for medical malpractice claims,

and May 1, 2016 for negligence claims, as the three year statute is longer than the one

year toll.” This action was commenced on February 15, 2016. Accordingly, an action

sounding in malpractice is time-barred, but one for negligence (and wrongful death) is

timely.

CPLR 205(A)

ACE Securities Corporation v. DB Structured Products, Inc., 52 Misc 3d 343 (Sup.Ct.

N.Y.Co. 2016)(Friedman, J.) – CPLR 205(a) provides that when an action is dismissed

for any reason other than on the merits, for lack of personal jurisdiction, for want of

prosecution, or upon voluntary discontinuance, “the plaintiff, or, if the plaintiff dies, and

the cause of action survives, his or her executor or administrator, may commence a new

action upon the same transaction or occurrence” within six months of termination of the

first action, notwithstanding the running of the statute of limitations [emphasis added].

Here, the original, dismissed, action was brought by investment funds that held 25% of

the voting rights in a Residential Mortgage-Based Securities Trust. This new action has

been commenced by the Trustee of the Trust. The Court finds that CPLR 205(a) is

inapplicable. “‘The common thread running through cases applying CPLR 205 in cases

where the error in the dismissed action lies only in the identity of the plaintiff, is the fact

that it is the same person or entity whose rights are sought to be vindicated in both

actions. The plaintiff in the new lawsuit may appear in a different capacity, such as a


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duly appointed administrator, but the identity of the individual on whose behalf redress is

sought, must remain the same.’” Here, “the certificateholders cannot be found to have

possessed a cause of action against defendant Sponsor to which the Trustee succeeded.

As the Trustee does not merely succeed to the certificateholders’ cause of action, it does

not act, for purposes of this litigation, in a representative capacity akin to that of an

administrator who succeeds to the decedent’s own cause of action.” The purpose of

CPLR 205(a) “‘is to provide a second opportunity to the claimant who has failed the first

time around because of some error pertaining neither to the claimant’s willingness to

prosecute in a timely fashion nor to the merits of the underlying claim’ [citations

omitted]. CPLR 205(a) serves the important remedial purpose of ‘ameliorating the

potentially harsh effect of the Statute of Limitations’ [citation omitted]. Nevertheless, the

statute does not afford relief to a plaintiff, like the Trustee, that declined to bring the

action within the limitations period.”

Ciafone v. Jofs for NY, Inc., N.Y.L.J., 1202767926225 (Sup.Ct. Queens Co. 2016)

(Livote, J.) – The six-month period in which to recommence an action pursuant to CPLR

205(a) begins to run after “the termination” of the initial action. And “termination of the

prior action occurs when appeals as of right are exhausted.” Here, the appeal of the

dismissal of the initial action is still pending. “As a result of the continued viability of

the 2013 lawsuit, the instant action, brought under CPLR 205(a), was commenced

prematurely and must be dismissed.”

Arty v. New York City Health and Hospitals Corporation, 148 A D 3d 407 (1st Dept.

2017) – Plaintiff’s original action was commenced in the United States District Court for

the Southern District of New York, stating discrimination claims, and defamation. In

December 2013, the Court dismissed the discrimination claims, and declined to exercise

supplemental jurisdiction over the defamation claim, dismissing it without prejudice.

Plaintiff then moved, under the Federal Rules of Civil Procedure and the Court’s local

rules, for reconsideration. That motion was granted in August 2014 to the extent only of

making one of the other dismissals without prejudice. This action, restating the

defamation claim, was commenced in December 2014. “The broad remedial purpose of

CPLR 205(a) mandates a finding that plaintiff’s defamation claim was timely filed.

Under Federal Rules of Appellate Procedure rule 4(a)(4)(A)(iv), plaintiff’s motion for

reconsideration extended the time for him to file a nondiscretionary appeal as of right to

the United States Court of Appeals for the Second Circuit until 30 days after the Federal

Rules of Civil Procedure rule 59(c) motion was decided – that is, until 30 days after the

August 18, 2014 order granting plaintiff’s Federal Rules of Civil Procedure rule 59(c)

motion.” Thus, since plaintiff did not thereafter appeal to the Second Circuit, the 6-

month period to recommence, pursuant to CPLR 205(a), began on August 18, 2014, and

this action is timely.


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Weksler v. Weksler, 140 A D 3d 491 (1st Dept. 2016) – The Court rejects respondents’

claim that CPLR 205(a) does not here apply because the original dismissed action was “a

nullity.” For, “‘resolution of questions involving CPLR 205 (subd [a]) is not aided by

use of the word nullity’ [citation omitted]. ‘Indeed, the statute by its very nature is

applicable in those instances in which the prior action was properly dismissed because of

some fatal flaw; thus to suggest that it should not be applied simply because there was a

deadly defect in the prior action seems nonsensical’ [citation omitted]. Respondents

complain that the 2014 order effectively gave petitioner an 11-year statute of limitations.

However, the Court of Appeals has ‘declined to subordinate CPLR 205(a) and the policy

preference it embodies even where the effect of the court’s declination was to toll for a

substantial period a designedly brief limitations period’ [citation omitted]. We note that

‘at least one of the fundamental purposes of the Statute of Limitations has in fact been

served, and respondents have been given timely notice of the claim being asserted by

petitioner.’”

Wells Fargo Bank, N.A. v. Eitani, 148 A D 3d 193 (2d Dept. 2017) – The issue before

this narrowly-divided Court is “whether the plaintiff in this mortgage foreclosure action,

which was assigned the note and mortgage during the pendency of the prior foreclosure

action, is entitled to the savings provision – or grace period – of CPLR 205(a) even

though the prior action was commenced by a prior holder of the note.” The majority

holds that plaintiff “is entitled to the benefit of CPLR 205(a) where, as here, it is the

successor in interest as the current holder of the note.” The statute limits its benefits to

“the plaintiff.” But, since the assignment took place while the original action was

pending, Wells Fargo, as assignee, “had a statutory right, pursuant to CPLR 1018, to

continue the prior action in [plaintiff] 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).” The

dissenters argued that “in the case at bar, the identity of the entity on whose behalf

redress is sought has not remained the same. Wells Fargo is not Argent in a different

capacity.” Thus, “while Wells Fargo seeks the same relief that Argent sought, namely, to

foreclose on the mortgage, Wells Fargo seeks not to vindicate Argent’s rights but to

vindicate Wells Fargo’s rights.”

Pecker Iron Works, LLC v. Beys Specialty, Inc., N.Y.L.J., 1202774632823 (Sup.Ct.

N.Y.Co. 2016)(Rakower, J.) – After plaintiff’s counsel was permitted to withdraw, the

Court directed that a new attorney file a notice of appearance within 30 days, and

scheduled a conference for a date thereafter. No one appeared for plaintiff at that

conference, and the Court dismissed the action pursuant to 22 NYCRR 202.27. Plaintiff

recommenced within six months of the dismissal. The Court denies defendant’s motion

to dismiss, rejecting the argument that CPLR 205(a) is inapplicable. First, a Rule 202.27

dismissal is not a dismissal on the merits. Nor does the exception for “neglect to


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prosecute” apply. “While the November 16, 2015 Order dismissing the 2011 Action

noted that plaintiff had ‘failed to appear before the Court for a scheduled conference’ and

that plaintiff’s attorney had withdrawn two months earlier, the Supreme Court did not ‘set

forth on the record the specific conduct constituting the neglect’ which would

‘demonstrate a general pattern of delay in proceeding with the litigation.’” And, “absent

such record indicating a general pattern of delay, this court cannot conclude that the prior

action was dismissed for ‘neglect to prosecute’ in light of the 2008 amendment to CPLR

205(a).”

Matter of Westchester Joint Water Works v. Assessor of the City of Rye, 27 N Y 3d 566

(2016) – “This appeal presents the question whether a proceeding dismissed for an

unexcused failure to comply with the mailing requirements of Real Property Tax Law

§708(3) may be recommenced pursuant to CPLR 205(a). We conclude that it may not.”

Petitioner here failed to comply with the statute’s direction that, “within 10 days of the

service of the notice of petition and petition on a municipality, a petitioner must mail a

copy of the same documents to the superintendent of schools of ‘any school district

within which any part of the real property on which the assessment to be reviewed is

located.’” The initial petition was therefore dismissed. The Court of Appeals, resolving

a split in the Appellate Divisions – indeed, a split within the Second Department –

concludes that “RPTL 708(3) does not permit resort to the recommencement largess of

the CPLR.” First, because the RPTL “comprehensively addresses the result where a

proceeding is dismissed for failure to comply with the mailing requirements of that

section, a petitioner may not reach outside of the RPTL to recommence such a

proceeding.” For, the statute itself provides that “the dismissal for failure to comply with

the mailing provisions of that statute shall be excused only ‘for good cause shown.’”

And the CPLR governs “the procedure in civil judicial proceedings in all courts of the

state and before all judges, except where the procedure is regulated by inconsistent

statute.” Second, the Court’s conclusion “is consistent with the rule of statutory

construction requiring that ‘effect and meaning must, if possible, be given to all parts of a

statute.’” For, if CPLR 205(a) were to apply, the RPTL language requiring “good cause

shown” would be superfluous. Finally, the Court’s interpretation of RPTL 708(3) is

“consistent with the legislative intent of that statute.”

THE BORROWING STATUTE

2138747 Ontario, Inc. v. Samsung C&T Corporation, 144 A D 3d 122 (1st Dept. 2016) –

“On this appeal, we are called upon to decide whether a broadly drawn contractual

choice-of-law provision, that provides for the agreement to be ‘governed by, construed

and enforced’ in accordance with New York law, precludes the application of New

York’s borrowing statute (CPLR 202). We find that it does not. Where, as here, the

plaintiff is a nonresident, alleging an economic claim that took place outside of New

York, the time limitations provisions in the borrowing statute apply, regardless of


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whether the parties’ contractual choice of law agreement can be broadly construed to

include the application of New York’s procedural, as well as its substantive law.” For,

“the borrowing statute is itself a part of New York’s procedural law and is a statute of

limitations in its own right, existing as a separate procedural rule within the rules of our

domestic civil practice, addressing limitations of time.” Thus, “applying the borrowing

statute is perfectly consistent with a broad choice-of-law contract clause that requires

New York procedural rules to apply to the parties’ disputes.” The Court noted that the

agreement’s choice-of-law provision “does not expressly provide that the parties agree

only to apply New York’s six-year statute of limitations to their contract-based disputes.

In this regard, there is no need to resolve whether such a provision would be an

unenforceable extension of the otherwise applicable statute of limitations.” Finally, the

Court rejected application of the esoteric (indeed, perhaps metaphysical) concept of

renvoi. Thus, “we also reject plaintiff’s alternative argument, that even if the New York

borrowing statute applies, requiring application of Ontario law, Ontario law mandates

application of New York’s six-year statute of limitations because the parties have chosen

New York law. It does not require that we apply the borrowing statute of a foreign

jurisdiction [citation omitted]. CPLR 202 only concerns statutes of limitations, it does

not require that we consider the foreign jurisdiction’s borrowing law.”

CONDITIONS PRECEDENT

Bayne v. City of New York, 137 A D 3d 428 (1st Dept. 2016) – “Assuming, without

deciding, that the statute of limitations was tolled during the pendency of plaintiff’s

petition [for leave to serve a late notice of claim] [citation omitted], it began running

anew on September 13, 2013, when Supreme Court granted plaintiff leave to serve a late

notice of claim [citation omitted]. Accordingly, plaintiff was required to commence an

action against the City within 13 days, on or before September 26, 2013, which he failed

to do [citation omitted]. The order granting plaintiff leave to serve a late notice of claim

within 30 days of the order could not extend the statute of limitations.”

PARTIES TO AN ACTION

JOINDER

NYCTL, 2012-A Trust v. Philip, 145 A D 3d 684 (2d Dept. 2016) – “‘Pursuant to RPAPL

1311, the plaintiff in a mortgage foreclosure action is required to join, as a party

defendant, any person “whose interest is claimed to be subject and subordinate to the

plaintiff’s lien,” including “every person having an estate or interest in possession in the

property as tenant in fee.” Accordingly, tenants are necessary parties to a foreclosure

action” [citations omitted], including a foreclosure action based on a tax lien [citations

omitted]. Although CPLR 1001 provides that the nonjoinder of a necessary party may be

excused by the court under certain circumstances [citation omitted], the plaintiffs here


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failed to make any showing as to why the tenants (the John Doe defendants) could not be

joined, or why their nonjoinder should be excused. Moreover, the principles of judicial

efficiency and economy are best served when piecemeal litigation can be avoided at the

outset.”

Jennings v. Chase Home Finance, LLC, 136 A D 3d 444 (1st Dept. 2016) – “Plaintiff, a

feeholder of the residential property at issue, seeks, among other things, a declaratory

judgment as to the rights of the parties with regard to a loan and a mortgage on the

property. Third-party defendant Maryrose Mlayi, a feeholder and mortgagor of the

property, is a necessary party to this action [citations omitted]. Since plaintiff never

sought to have Mlayi added as a defendant, Supreme Court properly dismissed the action

[citations omitted]. Mlayi, who is allegedly absent from the state, could have been served

by publication, if necessary [citations omitted], and is therefore subject to Supreme

Court’s jurisdiction. Accordingly, there is no basis for permitting the action to proceed

without her.”

CONSOLIDATION AND SEVERANCE

McGinty v. Structure-Tone, 140 A D 3d 465 (1st Dept. 2016) – The two actions sought to

be consolidated, i.e., a personal injury action and an insurance coverage action, do not

involve common questions of law or fact [citation omitted]; they involve different

contracts, different parties, and different factual issues [citation omitted]. Moreover,

litigating an insurance coverage claim together with the underlying liability issues is

inherently prejudicial to the insurer.” For, unlike the cases relied on by plaintiff,

“consolidation in this case would result in a single action involving the insured, the

insurance policy, and the construction of that policy.”

Fontana v. The TJX Companies, Inc., N.Y.L.J., 1202778704179 (Sup.Ct. Queens Co.

2017)(Modica, J.) – Plaintiff sued, in one action, a storeowner in whose establishment

she slipped and fell in October 2013, and the driver of a vehicle that caused her injuries in

May 2014. The Court denies the storeowner’s motion for severance. “While it is true

that plaintiff was involved in two separate accidents, seven months apart, plaintiff

complains of similar injuries to the same body parts in each accident. Significantly,

[driver] Balfus alleged in his answer a cross claim that plaintiff’s injuries were caused by

the negligence of [storeowners] USM, TJ Maxx, and Millenium, and Millenium alleged

in its answer a cross claim that plaintiff’s injuries were caused by the negligence of

Balfus. A claim by the defendant in one of the actions that the plaintiff’s injuries were

caused by the negligence of the defendant in the other action mandates that the two

actions should be tried together, absent a particularized showing pf prejudice [citations

omitted]. Furthermore, USM, TJ Maxx, and Millenium have not sufficiently

demonstrated that prejudice would result in the absence of severance.”


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Longo v. Fogg, 150 A D 3d 724 (2d Dept. 2017) – “In view of the plaintiff’s allegations

in his bill of particulars that certain injuries which he sustained in the first automobile

accident were exacerbated by the second automobile accident, in the interest of justice

and judicial economy, and to avoid inconsistent verdicts, the two actions should be tried

jointly [citations omitted]. The respondents failed to demonstrate prejudice to a

substantial right if this action is tried jointly [citations omitted]. Although the plaintiff

moved to consolidate the two actions, the appropriate procedure is a joint trial,

particularly since each action contains a defendant not present in the other [citations

omitted]. Furthermore, in the absence of special circumstances, where the actions have

been commenced in different counties, the place of trial should be in the county where

venue of the first action was placed.”

M.T. Packaging, Inc. v. Hoo, N.Y.L.J., 1202771905606 (Sup.Ct. N.Y.Co. 2016)(Kern, J.)

– Plaintiff sues its suppliers for fraud, and its suppliers’ lawyer, for alleged violations of

Judiciary Law §487 in an earlier action between the parties. The Court grants the

lawyer’s motion for severance. First, the two claims do not involve common questions of

law or fact. “The facts underlying plaintiff’s fraud claims against Hoo and VN K’s relate

to the sale of packaging and bags in 2008 and 2009, while the facts underlying plaintiff’s

Judiciary Law §487(1) claim against Maidenbaum relate to its representation of its

codefendants in the related action, which was commenced in 2012, and the instant action,

which was commenced in 2014.” Moreover, the fraud defendants would be prejudiced in

the absence of severance. “A defendant has the right to be represented by counsel of its

choice and thus a court should avoid disqualifying a defendant’s counsel unless necessary

[citations omitted]. It is a near certainty that Maidenbaum, Hoo’s and VN K’s counsel,

will be called as a witness with regard to plaintiff’s Judiciary Law §487(1) claim against

it and thus will likely be disqualified from representing Hoo and VN K’s at trial under the

advocate-witness rule in the absence of severance.” Finally, “Hoo and VN K’s may be

prejudiced in the absence of severance for the additional reasons that trying plaintiff’s

unrelated claim against Maidenbaum premised on the alleged misconduct of Hoo’s and

VN K’s counsel alongside plaintiff’s claims against Hoo and VN K’s may cause jurors to

become confused or form a negative impression of Hoo and VN K’s.”

ADDITION OF PARTIES

Warner v. Kain, N.Y.L.J., 1202763336921 (Sup.Ct. St. Lawrence Co. 2016)(Muller, J.) –

“Plaintiffs’ failure to follow the procedural mandates of CPLR 1003 prior to the filing

and service of its amended summons and verified complaint, constitutes a fatal

procedural defect and, as such, plaintiffs’ amended pleading must be dismissed. The

joinder of an additional defendant by the filing of a supplemental summons and amended

complaint may be accomplished [if done after expiration of the time to so amend as of

right] only with prior judicial permission, and noncompliance renders the pleadings

jurisdictionally defective [citations omitted]. Plaintiffs’ counsel’s belief and reliance that


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an insurer or their legal counsel consented to the supplemental pleadings is of no avail.

Although a defendant may waive the ‘jurisdictional defect’ of improper joinder where the

defendant answers the amended complaint without raising an objection to the improper

joinder, and then delays until after the limitations period has run before moving to

dismiss [citations omitted], NC Pizza raised the improper joinder in its first affirmative

defense.”

SUBSTITUTION OF PARTIES

Aurora Bank FSB v. Albright, 137 A D 3d 1177 (2d Dept. 2016) – “‘Generally, the death

of a party divests a court of jurisdiction to act, and automatically stays proceedings in the

action pending the substitution of a legal representative for the decedent pursuant to

CPLR 1015(a)’ [citations omitted]. ‘Any determination rendered without such

substitution will generally be deemed a nullity’ [citations omitted]. Furthermore, ‘the

death of a party terminates the authority of the attorney for that person to act on his or her

behalf’ [citations omitted]. Here, the deceased defendant died before the plaintiff’s

motion was made and before the order appealed from was issued. The attorney who had

represented the deceased defendant prior to his death purportedly took this appeal on

behalf of, among others, the deceased defendant. However, since a substitution of parties

had not been effected prior to the filing of the notice of appeal, counsel lacked the

authority to act for the deceased defendant, and the purported appeal taken on behalf of

the deceased defendant must be dismissed [citations omitted]. Furthermore, since no

substitution was made prior to the entry of the order appealed from, the order appealed

from is a nullity to the extent that it pertains to the deceased defendant, and we vacate so

much of the order as granted that branch of the plaintiff’s motion which was for summary

judgment on the complaint insofar as asserted against the deceased defendant [citations

omitted]. Similarly, in this case, since a proper substitution had not been made, the

Supreme Court should not have determined the merits of the plaintiff’s motion, even to

the extent that the plaintiff sought relief against the other defendants.”

Velez v. New York Presbyterian Hospital, 145 A D 3d 632 (1st Dept. 2016) – The

surviving plaintiff was delayed in getting appointed as administrator of the estate of the

deceased plaintiff, and moved for substitution some 21 months after decedent’s death.

Supreme Court denied that motion, and granted defendants’ motion to dismiss the action

for timely substitution. “The court lacked jurisdiction to grant defendants’ motions to

dismiss the action, since, ‘before proceeding further,’ and ‘upon such notice as it may in

its discretion direct,’ the court was required to ‘order the persons interested in the

decedent’s estate to show cause why the action should not be dismissed’ [citations

omitted]. The persons interested in Velez’s estate who were entitled to notice included

Velez’s two adult children. In any event, in the absence of any prejudice to defendants,

and in light of the strong public policy of deciding cases on the merits, the motion to

substitute, made less than two years after Velez’s death, should have been granted


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[citations omitted]. Defendants failed to show that the delay in seeking substitution

resulted in undue prejudice, since this medical malpractice action ‘will likely rely on

medical records and other documentary evidence and not the testimony of

eyewitnesses.’”

Rosenblatt v. Doe, N.Y.L.J., 1202781108149 (App.Term 2d Dept. 2017) – The majority

affirms the grant of a motion for substitution made four years after the death of the

plaintiff. “Upon a review of the record, we are of the opinion that, under the

circumstances of this case, the Civil Court did not abuse its discretion in granting

plaintiff’s motion. The only issue raised by defendant on this appeal is a claim of

prejudice because ‘the evidence has gone cold.’ However, defendant fails to identify any

evidence that became unavailable as a result of the delay and therefore fails to show

prejudice.” The dissenter argued that “CPLR 1021 requires that a motion for substitution

be made within a reasonable time after the event requiring substitution occurs.” And,

“the determination of reasonableness requires consideration of several factors, including

the diligence of the party seeking substitution, the prejudice to the other parties, and

whether the party to be substituted has shown that the action or the defense has potential

merit.” Here, “in light of the more than 41-month delay in obtaining preliminary letters

testamentary, the further 7-month delay in seeking substitution, the failure to demonstrate

a reasonable excuse for the delays, the absence of an affidavit of merit, and the potential

prejudice to defendant,” the dissent would have reversed Civil Court and denied the

substitution motion.

Howlader v. Lucky Star Grocery, Inc., ___ A D 3d ___, 2017 WL 3401134 (2d Dept.

2017) – “‘CPLR 1021 requires a motion for substitution to be made within a reasonable

time’ [citations omitted]. ‘The determination of reasonableness requires consideration of

several factors, including the diligence of the party seeking substitution, the prejudice to

the other parties, and whether the party to be substituted has shown that the action or the

defense has potential merit’ [citations omitted]. Here, the plaintiff’s counsel failed to

demonstrate that he made any diligent efforts to substitute a representative for the

deceased plaintiff. Additionally, the plaintiff’s counsel did not demonstrate a reasonable

excuse for failing to seek a substitution. Further, the plaintiff’s counsel failed to submit

an affidavit of merit, and did not rebut the contention of the defendant 2100 White Plains

Road Corp. (hereinafter 2100), joined by the defendant City of New York, that they were

prejudiced in their ability to defend the case.” The Appellate Division affirms the

dismissal of the action.

Kastrataj v. Blades, 136 A D 3d 756 (2d Dept. 2016) – “‘The Supreme Court is a court of

general jurisdiction with the power to appoint a temporary administrator, and may do so

to avoid delay and prejudice in a pending action’ [citations omitted]. ‘The determination

of whether to exercise its authority to appoint a temporary administrator is committed to

the sound discretion of the Supreme Court.’” But when, as here, plaintiff failed to


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demonstrate any effort to obtain such appointment from Surrogate’s Court, or to contact

the readily identifiable son of the deceased, Supreme Court properly denied the

application to make an appointment.

Krysa v. Estate of Qyra, 136 A D 3d 760 (2d Dept. 2016) – “In this action to recover

damages for alleged injuries arising from a vehicular accident, the plaintiff did not

commence this action against the operator of the offending vehicle until several months

after the operator died. Since ‘a party may not commence a legal action or proceeding

against a dead person’ [citation omitted], the action was a nullity from its inception, and

the plaintiff was instead required to commence an action against the personal

representative of the decedent’s estate [citations omitted]. Moreover, the plaintiff’s

attempt to amend the caption of the void complaint to designate the decedent’s estate as

the defendant was invalid [citations omitted]. The plaintiff never properly commenced

an action against the decedent’s personal representative, and the time within which to do

so had expired prior to the defendant’s motion for summary judgment.”

US Bank National Association v. Cadeumag, 147 A D 3d 881 (2d Dept. 2017) – “Since a

party may not commence a legal action or proceeding against a dead person, the 2009

action was a nullity from its inception, and the plaintiff was instead required to

commence an action against the personal representative of the decedent’s estate [citations

omitted]. Accordingly, the order [denying a motion “purportedly made by the defendant”

to dismiss the complaint] appealed from is a nullity, and this Court has no jurisdiction to

hear and determine the appeal purportedly taken by the deceased defendant.”

Vello v. Liga Chilean de Futbol, 148 A D 3d 593 (1st Dept. 2017) – “The motion to

substitute the Public Administrator as a defendant was properly denied because no action

was ever brought against Tagle before his death [citation omitted]. Plaintiffs argue that

the action against Liga Chilean should be treated as one against Tagle, but any action

commenced against Tagle after his death would be a ‘nullity’ since ‘the dead cannot be

sued’ [citation omitted]. Instead, plaintiffs were required to commence a legal action

naming the personal representative of the decedent’s estate.”

INTERVENTION

Reif v. Nagy, 149 A D 3d 532 (1st Dept. 2017) – “This action arises from two pieces by

the artist Egon Schiele alleged to have been looted by the Nazis during World War II

from cabaret artist Fritz Grunbaum, who, along with his wife Elisabeth, was executed

during the Holocaust. The pieces came into the possession of art dealer Nagy sometime

after 2013.” ARIS Title Insurance Company, which has insured Nagy’s title, seeks to

intervene. The Court affirms the denial of that motion. While intervention is liberally

granted, ARIS’s interest as the title insurer to ‘Woman Hiding Her Face’ is purely

derivative, no different from that of any insurer. And since it is entitled to approve of


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counsel selected by Nagy, with whom its interests are aligned, its position is well

protected.”

Castle Peak 2012-1 Loan Trust v. Sattar, 140 A D 3d 1107 (2d Dept. 2016) –

“Intervention under CPLR 1012 and 1013 requires a timely motion [citations omitted].

Here, Shelepers purchased the subject property with the knowledge that this foreclosure

action was pending, and yet it waited over four months before seeking leave to intervene.

Under the circumstances of this case, Shelepers’ motion for leave to intervene in the

action was untimely.”

INTERPLEADER

Aetna Life Insurance Co. v. Andacky, N.Y.L.J., 1202784574440 (Sup.Ct. Suffolk Co.

2017)(Mayer, J.) – In this classic case for interpleader, plaintiff insurance company seeks

to “pay into Court, pursuant to CPLR 1006, life insurance proceeds pursuant to a life

insurance policy Aetna issued to Mel J. Faust,” because “a dispute exists between the

decedent’s widow” and “the decedent’s son” and mother. Because Aetna “is a mere

stakeholder with no interest in the policy proceeds,” which faces the potential of multiple

liability, the Court permits it to deposit the funds into Court, and to recover its fees and

disbursements in this action.

Zahavi v. JS Barkats PLLC, 138 A D 3d 618 (1st Dept. 2016) – The ultimately successful

claimant is entitled to interest from the “stakeholder” “from the date on which plaintiff

established that defendants lacked any good faith basis for retaining the principal sum in

escrow.” For, as of that date, defendants “could not be considered stakeholders within

the meaning of CPLR 1006(f).” And, “it is of no consequence that defendants received

no benefit from the money because it was held in their IOLA account.”

CLASS ACTIONS

Gerard v. Clermont York Associates, LLC, 143 A D 3d 478 (1st Dept. 2016) – “The

motion court providently exercised its discretion in deeming the motion for class

certification, which was filed 17 days after the stipulated deadline, timely filed. A court

may in its discretion deem a late-filed class certification motion timely upon a showing of

good cause.”

Vasquez v. National Securities Corp., 139 A D 3d 503 (1st Dept. 2016) – Last year’s

“Update” reported on the Supreme Court decision in this action [48 Misc 3d 597 (Sup.Ct.

N.Y.Co. 2015)]. Supreme Court held that, “New York law requires notice to the class

where, as here, an individual settlement is reached prior to a decision on the merits of a

motion to dismiss or a motion for class certification.” While “the wisdom of this rule has

been questioned by many, including the CPLR commentary,” and defendants “urge the

court to follow modern federal case law,” since, “as defendants correctly observe, it is

well established that our state courts look to Rule 23 of the Federal Rules of Civil


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Procedure to inform New York’s class action law,” nonetheless, “this action is brought

under Article 9, and this court must follow the Appellate Division’s clear precedent.”

However, “in light of the early posture of this case and the relatively small size of the

purported class, the court will only approve a cost effective, electronic notice, such as the

emails plaintiff recently sent to the purposed class via LinkedIn (albeit without prior

court approval). Most importantly, the costs shall be incurred by plaintiff’s counsel. The

public policy underlying the significant class notice expense a defendant is usually

compelled to pay, such as upon certification, or after a class settlement is reached, is

inapplicable in this case where only plaintiff and his counsel benefit.” The Appellate

Division has affirmed. “The motion court correctly required notice of the impending

dismissal of the putative class action even though the class had not been certified.” For,

“the legislature has not amended CPLR 908 to conform to the federal statute. Although

defendant-appellant raises policy arguments in support of its position, its remedy lies

with the legislature and not with this Court.”

Desrosiers v. Perry Ellis Menswear, LLC, 139 A D 3d 473 (1st Dept. 2016) – “Although

the time in which to seek class certification had expired pursuant to CPLR 902 by the

time defendants sought discontinuance of this case based on the settlement, the court

improperly denied plaintiff’s application to send CPLR 908 notice to the putative class

members.” For, “CPLR 908 is not rendered inoperable simply because the time for the

individual plaintiff to move for class certification has expired. Notice to the putative

class members of the compromise in the instant case is particularly important under the

present circumstances, where the limitations period could run on the putative class

members’ cases following discontinuance of the individual plaintiff’s action.”

Jiannaris v. Alfant, 27 N Y 3d 349 (2016) – A prior year’s “Update” reported on the

Appellate Division decision in this action. [124 A D 3d 582 (2d Dept. 2015)]. In this

action seeking essentially to undo a merger, a majority of the divided Appellate Division

affirmed the denial of approval of a settlement “because it did not afford nonresident

class members the opportunity to opt out of the settlement in order to preserve their right

to assert claims for damages.” The majority relied upon the Court of Appeals decision in

Matter of Colt Industries Shareholder Litigation, 77 N Y 2d 185 (1991), which held that

in a class action solely for equitable relief, a Court may bind nonresident members of the

class even without an opportunity to opt out, but that, in a class action including a

damages component, the Court may not bind nonresident members of the class without

an opt-out provision. The dissenting Justice argued that, here, the damages at issue “are

merely incidental to the equitable relief sought,” and that, therefore “the court was not

required to afford any class members the opportunity to opt out.” Moreover, the dissenter

“disagree[d] with the practice of affording only out-of-state class members the

opportunity to opt out, while denying that opportunity to in-state class members.” The

Court of Appeals has affirmed. “At issue on this appeal is a proposed settlement of class

action litigation arising out of the merger of defendants On2 Technologies and Google,


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Inc. The proposed settlement would release and extinguish any and all damage claims

relating to the merger without affording class members an opportunity to ‘opt out,’

thereby prohibiting class members from pursuing any individual claims that are separate

and apart from the class settlement. We hold that because the proposed settlement in this

instance would deprive out-of-state class members of a cognizable property interest, the

courts below properly refused to approve the settlement.” For, “while the complaint

seeks predominately equitable relief, the settlement would also release any damage

claims relating to the merger by out-of-state class members. The broad release

encompassed in the agreement bars the right of those class members to pursue claims not

equitable in nature, which under [Phillips Petroleum Co. v.] Shutts [472 U.S. 797 (1985)]

and Colt, are constitutionally protected property rights.” The Court rejected the argument

that “incidental damages” should be treated differently from “individualized damage

claims.”

Onadia v. City of New York, 56 Misc 3d 309 (Sup.Ct. Bronx Co. 2017)(Danziger, J.) –

Plaintiff seeks to certify a class of those “unlawfully detained” more than 48 hours after

conditions for release have been satisfied, because of a “detainer” requested by United

States Immigration and Customs Enforcement. The Court, applying the conditions

specified in CPLR 902, grants certification. The numerosity standard is met by the

conclusion of an IT consultant that upwards of 9,000 persons fall in this category. The

claims of those potential class members are essentially the same, as it is limited to “those

individuals who were held beyond their release date based solely on a detainer that either

(1) specifically indicated than an investigation had been commenced or was pending by

ICE, or (2) failed to indicate a reason for the continued detention.” The proposed class

does not include “those individuals whose detainers indicated that the individual should

be held based on a warrant of arrest, notice to appear, or a deportation/removal order.”

The named plaintiff’s claim is typical of the class. “Typicality is a question of the nature

of the claim and not of the damages suffered.” Plaintiff is also an adequate representative

of the class. And, finally, a class action is “superior to other available methods for the

fair and efficient adjudication of the controversy.”

Weinstein v. Jenny Craig Operations, Inc., 138 A D 3d 546 (1st Dept. 2016) – “Where, as

here, ‘the same types of subterfuge were allegedly employed to pay lower wages,’

commonality of the claims will be found to predominate, even though the putative class

members have ‘different levels of damages’ [citations omitted]. Class action is an

appropriate method of adjudicating wage claims arising from an employer’s alleged

practice of underpaying employees, given that ‘the damages allegedly suffered by an

individual class member are likely to be insignificant, and the costs of prosecuting

individual actions would result in the class members having no realistic day in court.’”


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UNKNOWN PARTIES

Hormann Flexon, LLC v. Rytec Corporation, ___ A D 3d ___, 2017 WL 3297258 (3d

Dept. 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.’” This plaintiff failed to do.

ARTICLE 16

Artibee v. Home Place Corporation, 28 N Y 3d 739 (2017) – Last year’s “Update”

reported on the Appellate Division decision in this action [132 A D 3d 96 (3d Dept.

2015). CPLR 1601(1) provides, inter alia, that “the culpable conduct of any person not a

party to the action shall not be considered in determining any equitable share herein if the

claimant proves that with due diligence he or she was unable to obtain jurisdiction over

such person in said action (or in a claim against the state, in a court of this state)”

[emphasis added]. Thus, for the calculation of percentage of fault, to determine whether

any defendant has gone over the magic 50% level, and is therefore jointly and severally

liable for non-economic loss, the jury may be instructed to ascribe a percentage of fault to

a non-party unless plaintiff shows that, despite due diligence, the plaintiff was unable to

obtain jurisdiction over that non-party. Here, the non-party is the State of New York.

Plaintiff cannot sue the State in this action, not because of lack of personal jurisdiction,

but because of the Court’s lack of subject matter jurisdiction. A divided Appellate

Division held that the exception is limited to situations where there is an absence of

personal jurisdiction, and that the jury should be permitted to ascribe responsibility to the

State for purposes of Article 16 calculations. “Although we recognize the possibility of

inconsistent verdicts as to the apportionment of fault in Supreme Court and in the Court

of Claims, we note that this risk arises regardless of whether or not the jury is entitled to

apportion liability between defendant and the State [citation omitted]. Given the

statutory purpose of CPLR 1601(1) to ‘limit a joint tortfeasor’s liability for noneconomic

losses to its proportionate share, provided that it is 50% or less at fault’ [citation omitted],

we find that juries in this scenario should be given the option to, if appropriate, apportion

fault between defendant and the State.” The dissenter argued that the apportionment, in

light of the “constitutionally-mandated empty chair,” will result in an “unfair – or, at

least, skewed – result.” A divided Court of Appeals has reversed. First, the Court

focused on the parenthetical language in CPLR 1601 quoted above, which was

“specifically requested by the office of the Attorney General.” And, “pursuant to that

language, as long as a claimant in the Court of Claims could have commenced an action


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against a private tortfeasor in any court in the State of New York, then the tortfeasor’s

culpable conduct can be considered by the Court of Claims in determining the State’s

equitable share of the total liability [citation omitted]. The statute does not, however,

contain similar, express enabling language to allow apportionment against the state in a

Supreme Court action” [emphasis by the Court]. Second, “inasmuch as no claimant can

obtain jurisdiction over the State in Supreme Court and the statute does not, by its terms,

otherwise authorize the apportionment of liability against the State in that court, we agree

with plaintiff that defendant was not entitled to a jury charge on apportionment in this

action. Initially, we reject any argument that plaintiff did not face a jurisdictional

limitation in impleading the State as a codefendant in this action.” For, “the doctrine of

sovereign immunity is jurisdictional in nature.” For, “‘jurisdiction is a word of elastic,

diverse, and disparate meanings’ [citation omitted]. It can refer to both subject matter

jurisdiction, relating to ‘a court’s competence to entertain an action,’ as well as to the

court’s ‘power to render a judgment on the merits,’ which does not relate to subject

matter jurisdiction [citation omitted]. ‘The rationale for the jurisdictional restriction in

CPLR 1601 is that if a diligent claimant were able to sue all tortfeasors but neglected to

do so, then it would not be unfair for the culpability of a nonparty to be considered even

though the claimant’s recovery might not be as complete as that provided by the

common-law rule of joint and several liability’ [citation omitted]. As a practical matter,

it makes no difference to the parties what type of jurisdiction is absent – regardless of

whether a defendant is not subject to long-arm jurisdiction or Supreme Court lacks

subject matter jurisdiction, the ‘claimant cannot with due diligence obtain jurisdiction

over such person in said action’ [citation omitted]. To read the word ‘personal’ into the

statute, as dissenters and defendant would have us do, results in an interpretation broader

than that required by the statutory language itself, which simply uses ‘the catchall word

“jurisdiction”’ [citation omitted]. Because CPLR 1601 is a statute in derogation of the

common law, it must be strictly construed [citations omitted]. By its terms, the statute

does not specify that the inability to obtain jurisdiction must have a particular cause. ‘If

the legislature intended that the term “jurisdiction” mean only “personal jurisdiction,” it

could have easily done so with the addition of that one word to the statute” [emphasis by

the Court]. The dissent argued that “the majority’s interpretation of CPLR 1601 is a

strained reading of the statutory language and contravenes the legislative goal of limiting

the liability of any and all tortfeasors who are responsible for 50% or less of the total

liability. The majority’s analysis gives the State a preferred status over other tortfeasors,

despite no indication that the legislature intended such a result, and notwithstanding that

the plain reading of the text indicates the legislature simply wanted to create parallel

rights of apportionment for state tortfeasors and non-state tortfeasors.” Indeed, “the

statute’s requirement that the plaintiff exercise due diligence to obtain jurisdiction over a

tortfeasor cannot possibly refer to a court’s subject matter jurisdiction, where the

plaintiff’s due diligence has no bearing because a plaintiff can do nothing to affect a

court’s subject matter jurisdiction over the parties’ claims. Instead, the phrase ‘due


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diligence’ only makes sense in relation to personal jurisdiction, where a plaintiff may or

may not exercise due diligence [citation omitted]. Similarly, the phrase ‘over such

person’ makes sense when ‘jurisdiction’ is read as ‘personal jurisdiction,’ as the phrase is

meaningless in the context of subject matter jurisdiction, which refers to the authority of

a court to hear particular claims. Hence, the reference to jurisdiction in the statute

logically refers only to personal jurisdiction” [emphasis by the Court]. Finally, “there is

no reason why the State should be permitted to demonstrate the culpability of non-parties

in the Court of Claims but defendants in Supreme Court should not have the parallel right

to demonstrate the State’s culpability.”

INDEMNIFICATION AND CONTRIBUTION

Eisman v. Village of East Hills, 149 A D 3d 806 (2d Dept. 2017) – Plaintiff sues the

Village of East Hills claiming that his property was damaged by flooding caused by

development of land near his property, which development was approved by the Village.

The Village asserted claims for indemnification and contribution against plaintiff’s

architect, contractor and landscaper. First, the Court dismisses the indemnification claim.

“‘“Where one is held liable solely on account of the negligence of another,

indemnification, not contribution, principles apply to shift the entre liability to the one

who was negligent.” Conversely, where a party is held liable at least partially because of

its own negligence, contribution against other culpable tortfeasors is the only available

remedy’ [citations omitted]. ‘Whether indemnity or contribution applies depends not

upon the parties’ designation but upon a “careful analysis of the theory of recovery

against each tort-feasor”’ [citations omitted] Here, since the evidence showed that the

Village may not be held vicariously or statutorily liable for any negligence of any of the

third-party defendants, the Supreme Court should have granted that branch of the third-

party defendants’ motion which was to dismiss the indemnification cause of action in the

third-party complaint.” As to contribution, “‘purely economic loss resulting from a

breach of contract does not constitute “injury to property” within the meaning of New

York’s contribution statute CPLR 1401’ [citations omitted]. ‘Accordingly, under the so-

called “economic loss doctrine,” “contribution under CPLR 1401 is not available where

the damages sought are exclusively for breach of contract”’ [citations omitted]. ‘The

existence of some form of tort liability is a prerequisite to application of CPLR 1401’

[citations omitted]. Here, the third-party defendants claim that the only duties they owed

to the plaintiffs in the main action were purely contractual. However, the plaintiffs seek

to recover damages from the Village based on causes of action sounding in tort, and the

Village, in its third-party complaint, alleges that the third-party defendants breached a

duty of care independent of any contractual duties they owed to the plaintiffs. Even

though the third-party defendants may not ultimately be held liable in tort, the Supreme

Court properly denied that branch of the third-party defendants’ motion which was to

dismiss the contribution cause of action.”


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Board of Managers of the A Building Condominium v. 13th & 14th Street Realty LLC,

137 A D 3d 505 (1st Dept. 2016) – Defendant’s cross-claims for contribution “are barred,

because plaintiffs’ complaint seeks to recover only economic losses resulting from breach

of contract.”

Martin v. New York City Health and Hospitals Corporation, 145 A D 3d 484 (1st Dept.

2016) – Plaintiff was injured in an automobile accident, and was taken to defendant’s

hospital where, the complaint alleges, he was the victim of malpractice. The Court

denies the hospital’s motion “to place the driver of the vehicle that struck plaintiff, who

settled prior to institution of the instant action, on the verdict sheet. Defendants are

subsequent tortfeasors, and the jury was correctly charged that its award was to be limited

to the exacerbation of the original injury caused by malpractice [citations omitted].

Defendants’ argument that plaintiff’s original injury and subsequent amputation were

indivisible is without merit, in that the experts testified as to what the condition of the leg

would have been if it had been saved.”

Brion v. Moreira, N.Y.L.J., 1202770237552 (Sup.Ct. N.Y.Co. 2016)(Cohen, J.) – In this

legal malpractice action, based upon defendant’s failure to obtain revocation of a will,

defendant seeks to implead, for contribution purposes, the lawyer who succeeded him in

representing plaintiff, claiming that successor counsel improperly advised plaintiff to

settle the probate matter, failed to seek the testimony of defendant in the probate matter,

and filed unnecessary motions in that matter, causing excessive fees. “It is well-settled

law that an attorney sued for malpractice may assert a claim for contribution against

another lawyer who advised the plaintiff on the same matter.” For, “the relevant question

under CPLR 1401 is not whether the third-party defendant owed a duty to defendant but

whether they each owed a duty to plaintiff and by breaching their respective duties each

contributed to the ultimate injuries.” Here, “if defendants are successful in their defense

of this matter, the claim for contribution will be academic as defendants will not be liable

for malpractice. If plaintiff is successful in this matter and defendants are found to be

liable for malpractice for its failure to revoke the 2010 will and reinstate the 2004 will,

defendants’ first two theories for contribution could not have had a part in causing,

exacerbating or augmenting plaintiff’s injuries.” For, “the malpractice injury solely

stems from defendants’ alleged (in)actions. There is no allegation that [subsequent

counsel] DeLaurentis augmented the injury by also failing to revoke-reinstate the wills in

question. In fact, based upon the facts presented, DeLaurentis’ involvement began with

the representation of plaintiff after the death of Miguel Brion and, thus, could not have

revoked the will and stopped the injury.” To the extent that defendants contend that

DeLaurentis’ advice was faulty and had DeLaurentis litigated the probate matter the

result would have been different, if that contention is correct then, defendants would not

be liable for malpractice. Plaintiff’s entire action for damages hinges on that very

question and plaintiff can only be successful if they prove otherwise, i.e., that the 2010

will was not revoked.” However, contribution is permissible upon plaintiff’s claims for


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legal fees relating to the probate matter. “Defendants’ contention that a portion of those

legal fees are higher than they should be because of wrongful motion practice, poor

advice and failure to seek defendants’ testimony all could have exacerbated the total legal

fees and thus, defendants have properly stated a cause of action for contribution.”

Lederer v. Daily News, L.P., N.Y.L.J., 1202763984447 (Sup.Ct. N.Y.Co. 2016)(Bannon,

J.) – This is a defamation action in which plaintiff alleges that defendant newspaper

published photographs of him mis-identifying him as a registered sex offender.

Defendant seeks contribution and indemnification against the photographer and

distributor of the photographs. Contribution “will lie whether or not the culpable parties

are allegedly liable for the injury under the same or different theories [citation omitted],

and ‘whether or not the party from whom contribution is sought is allegedly responsible

for the injury as a concurrent, successive, independent, alternative, or even intentional

tort-feasor [citation omitted]. Moreover, a cause of action for contribution may also be

stated where it is alleged a contributor breached a duty owed to the defendant whom the

plaintiff seeks to hold liable, even if no duty exists between the contributor and the

injured plaintiff [citations omitted]. Accordingly, a valid cause of action for contribution

exists here if the third-party defendants owed and breached a duty either to the plaintiff or

to the News defendants to properly verify the identity of individuals depicted in the

photographs they either took or made available for use by the media.” And, here, “the

Court need not determine at this juncture whether the third-party defendants owed a

common-law duty of care to the News defendants, since they owed a duty directly to the

plaintiff. The relationship between a commercial freelance news photographer and a

photographic licensing agency, on the one hand, and the subject of a photograph taken or

licensed by them, on the other, is such that the miscaptioning of a photograph to depict an

individual as a sex offender would result in foreseeable harm to the person so depicted.”

Defendant’s indemnification claim, however, lacks merit. “‘In the classic common-law

indemnification case, the one entitled to indemnity from another committed no wrong,

but by virtue of some relationship with the tortfeasor or obligation imposed by law, was

nevertheless held liable to the injured party’ [citation omitted]. Common-law, or implied,

indemnification ‘permits shifting the loss because to fail to do so would result in the

unjust enrichment of one party at the expense of another’ [citation omitted]. Here, the

News defendants repeatedly published photos of the plaintiff, identifying him as Epstein,

to accompany articles implying that he engaged in illegal and immoral conduct, which

reached thousands of readers. Since the standard for common-law indemnification

requires that the party claiming entitlement to indemnity be without fault, the News

defendants have not pleaded facts sufficient to make out such a cause of action, since

they do not and cannot allege that they are entirely without fault.”


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GENERAL OBLIGATIONS LAW §15-108

Bloostein v. Morrison Cohen LLP, 2017 WL 2482942 (Sup.Ct. N.Y.Co. 2017)(Singh, J.)

– The main action here is a claim for legal malpractice alleging that plaintiff’s lawyers,

defendant Morrison Cohen, failed to properly advise plaintiff concerning the relevant

transaction, resulting in “significant capital gains taxes.” Morrison Cohen impleaded

Stonebridge, which designed the transaction, and Brown Rudnick, one of Stonebridge’s

lawyers. The third-party claim against Brown Rudnick sought, inter alia, contribution on

the grounds that Brown Rudnick had been the principal drafter of the transaction, and had

issued a tax opinion letter. The claims against Stonebridge were subsequently dismissed,

but the contribution claim against Brown Rudnick remained extant. Brown Rudnick then

commenced a fourth-party action against Stroock, Stonebridge’s other counsel with

respect to the transaction, seeking contribution. Stonebridge, meanwhile, had

commenced an arbitration against Stroock, alleging legal malpractice with respect to the

same transaction. That arbitration was resolved by a settlement agreement. By the

present motion, Stroock sought dismissal of Brown Rudnick’s fourth-party action for

contribution, as barred by General Obligations Law §15-108. That motion is granted, the

Court rejecting Brown Rudnick’s claim that the injury in this action is not, in the

language of the statute for “the same injury” as that resolved by the arbitration settlement.

For, “the contribution claim brought in this action by Brown Rudnick against Stroock

stems from the same Transaction, Opinion Letter and losses as those addressed in the

Arbitration. This action and the Arbitration is predicated upon legal malpractice. Both

Brown Rudnick and Stroock may be held jointly or severally culpable to the plaintiff

investors for the same injury. Accordingly, GOL §15-108 and the release bars Brown

Rudnick from seeking contribution from Stroock.”

PLEADINGS


Dept. 2016) – “It is well settled that a misrepresentation claim must be pleaded with

particularity [citations omitted]. CPLR 3016(b) ‘imposes a more stringent standard of

pleading’ than otherwise applicable [citation omitted]. The purpose of this strict pleading

requirement is to clearly inform a defendant as to the complained-of incidents [citation

omitted]. Thus, ‘conclusory allegations are insufficient.’”

Hirsch v. Stellar Management, 148 A D 3d 588 (1st Dept. 2017) – “The motion court

correctly determined that plaintiff failed to plead a fraud claim with the requisite

specificity [citation omitted]. Although plaintiff alleged that defendants committed a

material misrepresentation of fact, plaintiff failed to allege specific details to demonstrate

that he justifiably relied on the misrepresentation to his detriment.”


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Parker Waichman LLP v. Squier, Knapp & Dunn Communications, Inc., 138 A D 3d 570

(1st Dept. 2016) – “The complaint’s boilerplate allegations that defendants disclosed

confidential information, thereby causing harm, are too vague and conclusory to sustain a

breach of contract cause of action [citation omitted]. Moreover, the complaint failed to

allege how the alleged breach caused any injury [citation omitted]. Dismissal of the

cause of action alleging breach of fiduciary duty was also warranted since plaintiff failed

to plead it with particularity, as required by CPLR 3016(b) [citation omitted], and the

claim was duplicative of the breach of contract claim [citation omitted]. The court

properly denied plaintiff’s request for leave to replead, as plaintiff failed to submit a

proposed amended pleading accompanied by an affidavit of merit.”

Lemieux v. Fox, 135 A D 3d 713 (2d Dept. 2016) – “CPLR 3016(a) requires that ‘in an

action for libel or slander, the particular words complained of shall be set forth in the

complaint’ [citation omitted]. ‘Compliance with CPLR 3016(a) is strictly enforced’

[citation omitted]. Therefore, ‘a cause of action sounding in defamation which fails to

comply with these special pleading requirements must be dismissed’ [citation omitted].

Here, the cause of action alleging defamation did not set forth the particular words

complained of and alleged only that the defendants made ‘defamatory statements to the

plaintiff, William Lemieux’s employer and others calling into question his character and

professionalism.’” Dismissal of the complaint was affirmed.

Skanska USA Building, Inc. v. Atlantic Yards B2 Owner, LLC, 145 A D 3d 1 (1st Dept.

2016) – “The CPLR does not require a party asserting a contract claim to plead

compliance with a condition precedent [citation omitted]. Instead, it is incumbent upon

the party resisting the contract claim to plead the failure to comply with the condition

precedent.”

High Definition MRI, P.C. v. Travelers Companies, Inc., 137 A D 3d 602 (1st Dept.

2016) – “Here, the complaint standing alone failed to apprise defendant insurance

companies of basic pertinent information to put them on notice of the claims against

them, such as the patients treated and the insurance policies issued by defendant, under

which plaintiff submitted claims, for treatment rendered. However, in opposition to

defendant insurance companies’ motion to dismiss, plaintiff submitted an affidavit from

its principal with an exhibit attached providing such information. Thus, the complaint

and affidavit submitted in opposition sufficiently apprise defendant insurance companies

of the ‘transactions, occurrences, or series of transactions’ that form the basis of the

complaint.”

Rudzinski v. Glashow, N.Y.L.J., 1202788193790 (Sup.Ct. Kings Co. 2017)(Rivera, J.) –

“CPLR 3024(b) permits a party to make a motion to strike a scandalous or prejudicial

matter unnecessarily inserted in a pleading [citation omitted]. In reviewing a motion to

strike scandalous or prejudicial matter unnecessarily inserted in a pleading, the inquiry is


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whether the purportedly scandalous or prejudicial allegations are relevant to a cause of

action [citation omitted]. Striking of the entire pleading is not an available remedy under

CPLR 3024(b). The movant may only strike that portion of the pleading that contains the

unnecessarily scandalous and prejudicial matter. As [defendant] Carter sought only to

strike the entire complaint and did not specify which paragraphs were scandalous or

prejudicial the motion is denied on the merits.”

Deluca v. Clockman, N.Y.L.J., 1202775025829 (Sup.Ct. Nassau Co. 2016)(Diamond, J.)

– “Defendant’s ninth affirmative defense appears to be a reservation of rights to assert

further defenses during the course of discovery. Such a defense, in the opinion of this

Court, is not a recognized affirmative defense in the State of New York; moreover, it is

implicit in CPLR 3025 that no such reservation of rights is a necessary prerequisite for a

party to move to amend his answer to assert additional defenses.”

East 10th Street Associates, LLC v. Ritter Antik, Inc., N.Y.L.J., 1202767685718 (Civ.Ct.

N.Y.Co. 2016)(Goetz, J.) – In this commercial non-payment proceeding, respondent-

tenant has counterclaimed for damages resulting from “constructive eviction.” The lease

agreement forbids counterclaims. “However, a no counterclaim provision in a

commercial lease will not operate as a bar to a tenant’s asserting counterclaims in a

summary proceeding when the counterclaims are ‘inextricably intertwined’ with the

landlord’s claim.” Here, however, the tenant’s claims with respect to conditions in the

building resulting in its counterclaims “relate to periods prior to the period of time for

which Petitioner seeks rent arrears. Since the allegations in support of Respondent’s

counterclaims are not temporally related to the petition, the Court holds that

Respondent’s counterclaims are not inextricably intertwined with Petitioner’s claim for

rent.” Accordingly, the counterclaims were dismissed.

Paramount Pictures Corporation v. Allianz Risk Transfer AG, 141 A D 3d 464 (1st Dept.

2016) – In 2008, despite a contractual covenant not to sue, the defendants in this action

sued the plaintiff in this action for fraud, in Federal Court, seeking to recoup losses on an

investment. That Court dismissed the action, finding that fraud had not been proved.

Neither side raised the covenant not to sue. In this action, plaintiff seeks damages for

defendants’ breach of the covenant not to sue. Defendants move to dismiss, claiming that

the claim was waived by plaintiff’s failure to assert it as a counterclaim in the Federal

action. “New York is a permissive counterclaim jurisdiction [citation omitted]. ‘Our

permissive counterclaim rule may save from the bar of res judicata those claims for

separate or different relief that could have been, but were not interposed in the parties’

prior action. It does not, however, permit a party to remain silent in the first action and

then bring a second one on the basis of a preexisting claim for relief that would impair

the rights or interests established in the first action.’” Here, “while we agree with

plaintiff that the relief it seeks in this action (i.e., attorneys’ fees incurred in the federal

action) would not ‘impair the rights or interests established’ in the federal action,


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meaning that New York’s permissive counterclaim rule would save it from the traditional

bar of res judicata, the inquiry does not end there where the prior action was adjudicated

in a compulsory counterclaim jurisdiction.” The Court concluded that, under the Federal

Rules of Civil Procedure, Rule 13(a), plaintiff’s claim would have been a compulsory

counterclaim in Federal Court. While noting that “there is no binding precedent which

holds that state courts must apply Federal Rules of Civil Procedure rule 13(a),” the Court

quoted from a Southern District opinion that “‘when the forum in which the prior

litigation occurred was a compulsory counterclaim jurisdiction, notions of judicial

economy and fairness require that a party be precluded from bringing all claims that it

earlier had the opportunity – exercised or not – to assert as counterclaims.” It also cited

dicta from the Court of Appeals decision in Gargiulo v. Oppenheim, 63 N Y 2d 843

(1984), in which the Court assumed “without deciding, that under the procedural

compulsory counterclaim rule in the Federal Courts [citation omitted] claim and issue

preclusion would extend to bar the later assertion in the present State court action of a

contention which could have been raised by way of a counterclaim.” Thus, the Court

concludes “that the later assertion in a state court action of a contention that constituted a

compulsory counterclaim [citation omitted] in a prior federal action between the same

parties is barred under the doctrine of res judicata.”

Mutual Benefits Offshore Fund v. Zeltser, 140 A D 3d 444 (1st Dept. 2016) – “A

counterclaim must assert a cause of action against the plaintiff [citations omitted].

Although the original counterclaims in this action named plaintiff as a counterclaim

defendant, the amended counterclaims, which are the operative pleadings [citation

omitted], do not. While a counterclaim may be made against ‘a person whom a plaintiff

represents’ [citation omitted], plaintiff is not a representative, executor, or administrator

of any of the counterclaim defendants [citation omitted]. Accordingly, the motion court

correctly dismissed the counterclaims with prejudice. Given the procedural requirements

for a third-party action (see CPLR 1007), the motion court properly declined to convert

the amended counterclaims into third-party claims. As the motion court noted, however,

dismissal of the counterclaims does not preclude defendants/counterclaim plaintiffs from

bringing a third-party action.”

Larke v. Moore, 150 A D 3d 1620 (4th Dept. 2017) – “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.”

Velasquez v. The Donado Law Firm PC, N.Y.L.J., 1202764214766 (Sup.Ct. Nassau Co.

2016)(Diamond, J.) – “Where a complaint charges allegations of what would be a crime,

a Defendant need not verify his pleading if doing so might incriminate him.”


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Putrelo Construction Company v. Town of Marcy, 137 A D 3d 1591 (4th Dept. 2016) –

Last year’s “Update” reported on Medina v. City of New York, 134 A D 3d 433 (1st Dept.

2015), in which the First Department held that, “since the limited proposed amendments

were clearly described in the moving papers, plaintiff’s failure to submit proposed

amended pleadings with his original moving papers (CPLR 3025[b]), was a technical

defect, which the court should have overlooked [citation omitted], particularly after

plaintiff provided those documents with his reply.” Here, in Putrelo, the Fourth

Department applies a similar standard: “Plaintiff failed to include an amended pleading

with its motion, as required by CPLR 3025(b). Under the circumstances of this case,

however, we conclude that the error was merely a technical defect that the court should

have disregarded [citation omitted], inasmuch as ‘the limited proposed amendment was

clearly described in the moving papers’ and did not prejudice defendant or third-party

defendant [citations omitted]. We further conclude that defendant and third-party

defendant failed to show that they would be prejudiced by the amendment. ‘In the

absence of prejudice, a motion to amend the ad damnum clause, whether made before or

after the trial, should generally be granted’ [citation omitted]. We reject the contention of

defendant and third-party defendant that the amendment was ‘palpably insufficient or

patently devoid of merit’ [citation omitted]. Defendant and third-party defendant rely

upon documents submitted by them in opposition to the motion, but ‘a court should not

examine the merits or legal sufficiency of the proposed amendment unless the proposed

pleading is clearly and patently insufficient on its face’ [citations omitted]. Finally, while

the delay in moving to amend was extensive and plaintiff provided no excuse for it, ‘mere

lateness is not a barrier to the amendment. It must be lateness coupled with significant

prejudice to the other side’ [citation omitted], which, as we previously concluded,

defendant and third-party defendant did not show.”

U.S. Bank National Association v. Shereshevsky, N.Y.L.J., 1202773822309 (Sup.Ct.

Kings Co. 2016)(Rivera, J.) – “An amended pleading, once served, supersedes the initial

pleading and becomes the only pleading in the case as though the initial pleading was

never served [citations omitted]. By amending the complaint and serving it upon

[defendant] Crockett, USBNA replaced the original complaint as if the original complaint

never existed. It was then USBNA’s obligation to serve the amended complaint on all

the defendants to trigger their respective obligation to answer the amended complaint.”

Thus, a co-defendant, who never responded to the original complaint served on her, was

not subject to a default, since plaintiff did not serve her with the amended complaint.

Moezinia v. Ashkenazi, 136 A D 3d 990 (2d Dept. 2016) – “Generally, a defense based

upon the statute of limitations is waived unless raised by pre-answer motion or in the

defendant’s answer [citation omitted]. A defendant, however, may assert a statute of

limitations defense for the first time in an answer served in response to a plaintiff’s

amended complaint [citation omitted]. Moreover, a party may amend its pleading once

without leave of court, among other circumstances, within 20 days after service of that


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pleading [citation omitted]. An amended answer, made as a matter of right pursuant to

CPLR 3025(a), may include a statute of limitations defense previously omitted.”

Commonwealth Land Title Insurance Company v. Sienna Abstract, LLC, 136 A D 3d 965

(2d Dept. 2016) – “Where ‘no prejudice or surprise results from the delay in seeking

leave to amend a pleading, such applications are to be freely granted unless the proposed

amendment is palpably insufficient or patently devoid of merit’ [citations omitted].

Lateness alone is not a barrier to an amendment [citation omitted]. Rather, lateness must

be coupled with significant prejudice to the other side, the very elements of the laches

doctrine.”

Makris v. Quartz Associates, N.Y.L.J., 1202763223476 (Sup.Ct. N.Y.Co. 2016)(Bluth,

J.) – Defendants’ motion to amend their answer to assert a statute of limitations defense

to some of the causes of action, made four years after their original answer, is denied.

For, “plaintiff has demonstrated that she would suffer substantial prejudice if this

amendment was permitted.” While “delay is not sufficient, by itself, to deny a request to

amend,” plaintiff “has demonstrated that she would have explored the united in interest

issue as a possible defense to the statute of limitations claim if it had been timely raised.

Further, plaintiff was prejudiced by expending more resources on discovery [citation

omitted]. If ABO had timely raised the statute of limitations defense, and was successful,

plaintiff would have focused only on the remaining causes of action. Instead, plaintiff

conducted discovery with all defendants on all causes of action and took 19 depositions.

Surely plaintiff may have taken some of these depositions anyway, but plaintiff’s

litigation strategy for the past several years would have changed dramatically had ABO

raised the statute of limitations in a timely manner.”

Civil Service Employees Association, A.F.S.C.M.E., Local 1000, A.F.L.-C.I.O. v. County

of Nassau, 144 A D 3d 1075 (2d Dept. 2016) – “We agree with the plaintiffs that the

Supreme Court improvidently exercised its discretion in granting the County’s motion for

leave to amend its answer to assert the statute of limitations as a defense and for summary

judgment dismissing the complaint as time-barred [citation omitted]. The County’s

motion was not made until approximately six years after service of its answer, after the

parties had completed discovery, and after the note of issue had been filed. Under these

circumstances, the plaintiffs have suffered significant prejudice from the County’s delay

in asserting the statute of limitations as a defense [citations omitted]. Moreover, the facts

set forth by the County in support of the proposed defense were known to the County at

the time that it served its answer, and no excuse has been offered for the delay.”

Harris v. Finster, Inc., N.Y.L.J., 1202754585220 (Sup.Ct. Greene Co. 2016)(Fisher, J.) –

Plaintiff belatedly seeks to amend his complaint to add new items of damage. But “there

is prejudice to defendants.” For, “it is without question that Defendants have not had an

opportunity to conduct disclosure regarding the newly alleged monetary damages, as well


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as Plaintiff’s loss of ‘use and enjoyment’ of his property now alleged in the amended

Complaint.” However, “given the extensive case law granting amendments, the Court is

permitting Plaintiff to amend his Complaint. However, the Court may award ‘costs and

continuances’ as ‘may be just’ in permitting such amendment, and elects to do so here

because of the prejudice on Defendants and the temporal delay by Plaintiff which could

have alleviated at least some of the prejudice. Therefore, Plaintiff shall pay for the costs

of all disclosure to occur due to this amendment, including the full cost of a further

deposition(s), transcript reproductions, any further paper disclosure, and other related

costs due to Plaintiff’s delayed amendment [citations omitted]. Additionally,

Defendants’ counsel may submit an affidavit of counsel fees and receive reasonable

compensation for the extra time expended on the matter due to the late amendment,

which includes counsel fees for further deposition(s), drafting/responding disclosure

demands or supplemental bill of particulars, and other related costs endured due to the

amendment only.”

Bleakley Platt & Schmidt, LLP v. Barbera, 136 A D 3d 725 (2d Dept. 2016) – After

plaintiff commenced this action for legal fees, defendant Barbera commenced a separate

action for legal malpractice. In her answer in the fee action, Barbera asserted as an

affirmative defense that the claims were barred by acts of professional negligence.

Thereafter, Barbera moved to consolidate the two actions. That motion was denied, “due

to the defendant’s record of delay with respect to discovery in this action and due to her

prior violation of a discovery order. The court also noted that this action and the legal

malpractice action were at completely different stages of discovery and that it had already

directed that there be no further delay in this action.” Now, Barbera moves to amend her

answer in this action to assert, as a counterclaim, everything she alleges in the

malpractice action. The Appellate Division affirms the denial of that motion.

Red Zone LLC v. Cadwalader, Wickersham & Taft LLP, 27 N Y 3d 1048 (2016) – Last

year’s “Update” reported on the Appellate Division decision in this action [118 A D 3d

581 (1st Dept. 2014)], and a prior year’s “Update” reported on the Supreme Court

decision [N.Y.L.J., May 21, 2013, 1202604831378 (Sup.Ct. N.Y.Co.)]. In this legal

malpractice action, defendant opposes plaintiff’s motion for summary judgment and

seeks to amend its answer to add a defense of assumption of the risk, based upon the

affidavit of one of its partners that the client agreed to the deal that caused its damages

against his advice. However, in a prior related litigation, that partner was deposed, and,

as Supreme Court noted, “he testified he gave instructions for a letter agreement with

certain terms; he testified it worked; and was clear. His affidavit now says the terms

were not there; it did not work, was not clear, and that he advised against accepting it.”

Although concluding that plaintiff would not be prejudiced by defendant’s delay in

seeking the amendment, “the court’s opinion is that granting the motion – taking into

account defendant’s new theory of defense and Mr. Block’s affidavit, which starkly

contradicts his prior deposition testimony – would gravely prejudice New York’s rules-


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based court system.” The Appellate Division affirmed. Because the affidavit in support

of the motion to amend “directly contradicts” the attorney’s earlier deposition testimony,

“the proposed amendment is patently devoid of merit.” The Court of Appeals has

modified, and essentially reversed. “While a party may not create a feigned issue of fact

to defeat summary judgment [citation omitted], contrary to plaintiff’s assertion here, the

affidavit of the attorney who represented plaintiff did not flatly contradict his prior

deposition testimony. Therefore, the affidavit should have been considered in opposition

to plaintiff’s motion.”

Genger v. Genger, N.Y.L.J., 1202769249714 (Sup.Ct. N.Y.Co. 2016)(Jaffe, J.) –

“Pleadings may be amended to conform them to the evidence before or after judgment,

‘upon such terms as may be just including the granting of costs and continuances’

[citation omitted]. The court may permit the amendment even if it ‘substantially alters

the theory of recovery’ [citations omitted]. That the judgment is summarily awarded

does not preclude such an amendment [citation omitted]. The sole consideration guiding

the court’s considerable discretion is whether the opposing party would be hindered in

preparing its case [citation omitted]. However, the liberality in granting a motion to

conform does not alter the rule that ‘a party is precluded from inequitably adopting a

position directly contrary to or inconsistent with an earlier assumed position in the same

proceeding’ [citations omitted]. Nor does it alter the law that a party is barred by res

judicata from relitigating an issue that was fully litigated.”

MOTION PRACTICE

MOTION PROCEDURE

First United Mortgage Banking Corp. v. Lawani, 147 A D 3d 912 (2d Dept. 2017) – “We

caution that a dismissal based almost entirely upon an independent Internet investigation

[by the Court], especially one conducted without providing notice or an opportunity to be

heard by any party, is improper and should not be repeated.”

Taylor v. Fashakin, 53 Misc 3d 1173 (Sup.Ct. Kings Co. 2016)(Rivera, J.) – On this

motion to dismiss the complaint, defendant’s “motion papers consist of a notice of

motion, a memorandum of law in support of the motion and six annexed exhibits. The

instant motion is unsupported by any testimony from anyone with personal knowledge of

the facts that it relies upon. Nor are there any sworn allegations of fact from anyone with

personal knowledge explaining what the six documents annexed to the motion are

purported to be. Although the memorandum of law in support of the motion is signed by

[defendant] Janet Fashakin before a notary public, it is not an affidavit. The

memorandum of law does not state that the facts alleged in the document are sworn under

penalty of perjury or that the document is true. An unsworn declaration neither made


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under penalty of perjury nor stating that the document is true is not an ‘affidavit’

[citations omitted]. Inasmuch as the facts and documents proffered to support the instant

motion are not admitted under oath by anyone with personal knowledge, the instant

motion fails to comply with the minimal requirements of CPLR 2214. It is therefore

denied without prejudice.”

Nieto v. Deveau, 51 Misc 3d 1027 (Civ.Ct. Kings Co. 2016)(Montelione, J.) – “Plaintiff

argues that Defendant’s motion should be denied as it failed to demonstrate timely

service of the Order to Show Cause. It is undisputed that Defendant’s Order to Show

Cause was served one day late. However, after oral argument, the Court granted Plaintiff

additional time to serve its opposition thereto. As such, Plaintiff’s argument that it is

prejudiced by virtue of the service of the Order to Show Cause by one day is

unpersuasive and is rejected.”

People ex rel. Schneiderman v. Ultimate Security Force, Inc., N.Y.L.J., 1202784121621

(Sup.Ct. N.Y.Co. 2017)(Jaffe, J.) – “The mode of service provided for in an order to

show cause must be followed literally and is jurisdictional in nature.” That the adversary

“received the papers or had notice of them is of no moment” if they are not served

pursuant to the dictates of the order.

Woodward v. Milbrook Ventures LLC, 148 A D 3d 658 (1st Dept. 2017) – The Appellate

Division affirms Supreme Court’s denial of defendants’ motion to change venue on the

ground that it was untimely. “Having consented to electronic filing, defendants were

required to serve their papers electronically [citation omitted], and indeed served their

demand for change of venue, together with their answer, by e-filing the documents on

July 14, 2015 [citation omitted]. Having served their demand, defendants were required

to bring their motion to change venue within 15 days, or by July 29, 2015 [citation

omitted]. 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.”

Oglesby v. Barragan, 135 A D 3d 1215 (3d Dept. 2016) – “Plaintiffs’ argument that they

are entitled to an extension of time for service [of process] in the interest of justice is not

properly before us [citation omitted]. As plaintiffs concede, they raised this argument for

the first time in their reply papers on the motion. Reply papers are intended to address

contentions raised in opposition to a motion and not to supplement a motion with new

arguments.”

Central Mortgage Company v. Jahnsen, 150 A D 3d 661 (2d Dept. 2017) – “Contrary to

the appellant’s contention, it was not error for the Supreme Court to consider the reply


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affidavit, which was submitted in reply to the appellant’s opposition. A party moving for

summary judgment generally cannot meet its prima facie burden by submitting evidence

for the first time in reply [citations omitted]. However, there are exceptions to this

general rule, including when the evidence is submitted in response to allegations raised

for the first time in the opposition papers or when the other party is given an opportunity

to respond to the reply papers [citations omitted]. Further, ‘the function of reply papers is

to address arguments made in opposition to the position taken by the movant’ [citations

omitted]. Here, the Supreme Court properly considered the reply affidavit because the

affidavit was offered in response to the appellant’s allegation in opposition to the motion

that the plaintiff never had possession of the note, and merely clarified the plaintiff’s

initial submissions as to its possession of the note at the time of commencement.”

Citimortgage, Inc. v. Dulgeroff, 138 A D 3d 419 (1st Dept. 2016) – “Contrary to the

motion court’s ruling, West Fork’s failure to attach the judgment of foreclosure to its

motion to intervene and to vacate the judgment is not a fatal defect. At most, the court

should have directed West Fork to supplement or resubmit its papers [citations omitted].

However, contrary to West Fork’s argument, the order on appeal need not be vacated for

failure to recite the papers on which it is based.”

Halley v. Servedio, N.Y.L.J., 1202752844157 (City Ct. Poughkeepsie 2016)(Mora, J.) –

“The rule is that where an attorney is a party to the action, the attorney must file an

affidavit, not an affirmation, in support of his papers. Specifically, the law provides that

an attorney may only file an affirmation when he is not a party to an action” [emphasis by

the Court].

L.H.M.B. v. D.A.M.Q., N.Y.L.J., 1202773784794 (Sup.Ct. N.Y.Co. 2016)(Helewitz,

Sp.Ref.) – “Knowledge of the English language, or lack thereof, is not a barrier to being

afforded the opportunity to present a matter to the court for adjudication. However

CPLR 2101(b) requires that when a paper is filed in a foreign language, it must be

accompanied by a certified translation. This same requirement of providing the court

with a certified translation applies even if the document is in English but is being filed by

a non-English speaking party. In the case at bar, the litigants do not read, write or speak

English and the service that they used to prepare their uncontested divorce papers,

knowing this, simply had them sign papers in the English language, apparently hoping

that the court would not discover that the parties did not understand, legally, what they

were signing. ‘The court has held that the absence of a translator’s affidavit, required of

foreign-language witnesses, renders the witness’s English-language affidavit facially

defective and inadmissible’ [citations omitted]. Consequently, both plaintiff’s ‘verified’

complaint and defendant’s ‘affidavit’ are legally insufficient to support the matter. Based

on the foregoing, this matter is dismissed.”


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Matter of Meighan v. Ponte, 144 A D 3d 917 (2d Dept. 2016) – A prior year’s “Update”

reported on Rosenblatt v. St. George Health and Racquetball Associates, LLC, 119 A D

3d 45 (2d Dept. 2014). There, the Second Department distinguished its earlier decision

in Tirado v. Miller, 75 A D 3d 153 (2d Dept. 2010). In Tirado, defendant moved to

quash a third-party subpoena. Nisi prius granted the motion, but on grounds different

from those urged by defendant. The Appellate Division held that, “trial courts are not

necessarily limited by the specific arguments raised by parties in their submissions,”

although “a court typically lacks the jurisdiction to grant relief that is not requested in the

moving papers.” However, “the presence of a general relief clause enables the court to

grant relief that is not too dramatically unlike that which is actually sought, as long as the

relief is supported by proof in the papers and the court is satisfied that no party is

prejudiced.” In Tirado, “the relief granted, of quashing the plaintiff’s subpoena and, in

effect, granting a protective order, is not only similar, but in fact identical, to the ultimate

relief demanded in the notice of motion, albeit on a different basis. We find that the

general relief clause in the notice of motion permitted the court to consider an alternative

ground for granting the motion, consistent with the ultimate relief that was requested, and

which was based upon material contained in the court’s own file.” The Court rejected the

argument that the Trial Court improperly acted sua sponte. “There is a critical distinction

between sua sponte relief not requested by any party, and sua sponte reasoning in

granting or denying nondispositive discovery relief that has been requested by a party.”

In Rosenblatt, on defendant’s motion for summary judgment, it relied upon plaintiff’s

unsigned and uncertified deposition transcript. Plaintiff argued that the transcript could

not be relied upon because it was “unverified.” Supreme Court, recognizing that

verification was unnecessary, nonetheless, sua sponte, concluded that, because the

transcript was uncertified, the motion must be denied. The Appellate Division reversed,

distinguishing Tirado. “The motion at issue in Tirado, which related to discovery, did

not have ‘dispositive import’ to that action [citation omitted]. By contrast, [defendant’s]

motion for summary judgment is dispositive in nature. Thus, Tirado is distinguishable

from the instant case. Here, the Supreme Court denied the subject motion for summary

judgment on a ground that the parties did not litigate. The parties did not have an

opportunity to address the issue relating to the certification of the plaintiff’s deposition

transcript, relied upon by the Supreme Court in denying that dispositive motion. The lack

of notice and opportunity to be heard implicates the fundamental issue of fairness that is

the cornerstone of due process.” For, “‘we are not in the business of blindsiding litigants,

who expect us to decide their appeals on rationales advanced by the parties, not

arguments their adversaries never made.’” Here, in Meighan, respondent moved to

dismiss this Article 78 proceeding on the ground that the petition failed to state a cause of

action. Supreme Court dismissed the proceeding on the ground that petitioner had failed

to file proof of service of the notice of petition and petition. The Appellate Division

reverses. First, “‘the failure to file proof of service is a procedural irregularity, not a

jurisdictional defect, that may be cured by motion or sua sponte by the court in its


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discretion pursuant to CPLR 2004.’” Moreover, respondent never contended “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 [citations omitted]. ‘The lack of

notice and opportunity to be heard implicates the fundamental issue of fairness that is the

cornerstone of due process.’”

North Oyster Bay Baymen’s Association v. Town of Oyster Bay, 150 A D 3d 865 (2d

Dept. 2017) – “Although a court ‘is generally limited to the issues or defenses that are the

subject of the motion’ if the motion is dispositive of the underlying action [citations,

including to Rosenblatt v. St. George Health and Racquetball Associates, LLC, discussed

above, omitted], a court may decide a nondispositive motion ‘upon grounds other than

those argues by the parties in their submissions’ where ‘the court’s grant or denial of

relief is confined to the specific family of relief sought in the motion’ [citing to Tirado v.

Miller, discussed above].”

Mew Equity, LLC v. Sutton Land Services, LLC, 144 A D 3d 874 (2d Dept. 2016) – On

this motion for summary judgment, moving defendants “submitted the complaint and

their answer, but did not submit the answers of the other defendants. The Mew plaintiffs,

in opposition, did not contend that this branch of the Sutton defendants’ motion should be

denied due to the Sutton defendants’ failure to fully comply with CPLR 3212(b).

Consequently, the court should not have raised the issue on the Mew plaintiffs’ behalf.”

Matter of Etna Prestige Technology, Inc. v. Long Island Railroad Company, 148 A D 3d

885 (2d Dept. 2017) – “The LIRR did not seek dismissal of the petition on the ground

that the petitioner failed to exhaust its administrative remedies and, thus, the denial of the

petition on that ground was not warranted.”

USAA Federal Savings Bank v. Calvin, 145 A D 3d 704 (2d Dept. 2016) – “In the order

appealed from, the Supreme Court granted [defendant] Ivette’s motion to stay the

foreclosure sale and granted her request, made in her reply affirmation, to vacate the

judgment of foreclosure and sale entered April 26, 2012, on condition that she pay a

certain sum of money. The court also, sua sponte, awarded related relief not requested by

the parties. The court may grant relief that is warranted pursuant to a general prayer for

relief contained in a notice of motion if the relief granted is not too dramatically unlike

the relief sought, the proof offered supports it, and there is no prejudice to any party

[citations omitted]. Here, Ivette’s application to vacate the final judgment of foreclosure

and sale, as well as the related relief awarded, sua sponte, by the Supreme Court, was

‘dramatically unlike’ the relief sought in Ivette’s motion, which only sought to stay the

impending foreclosure sale based on her pending contempt motion in the matrimonial

action. The function of reply papers is to address arguments made in opposition to the


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position taken by the movant and not to permit the movant to introduce new arguments in

support of, or new grounds or evidence for, the motion [citations omitted]. Here, Ivette’s

reply papers included new arguments in support of the motion, new grounds and evidence

for the motion, and expressly requested relief that was dramatically unlike the relief

sought in her original motion. Accordingly, those contentions, and the grounds and

evidence in support of them, were not properly before the Supreme Court. Similarly, the

court erred in, sua sponte, awarding related relief not requested by the parties.”

Messam v. Omeally, N.Y.L.J., 1202767664745 (App.Term 2d Dept. 2016) – “While oral

opposition to a motion is not prohibited per se [citation omitted], we note that a motion

court has several alternatives when confronted with a party’s failure to submit written

opposition to its adversary’s motion: the court may treat the party’s failure to submit

written opposition to its adversary’s motion as a default [citations omitted]; it may decide

not to hold the party in default and, instead, to extend that party’s time to submit written

opposition; or it may simply consider the oral arguments put forth by that party as that

party’s opposition [citation omitted]. Of course, if the court chooses not the treat the

party’s failure to submit written opposition as a default, sworn written opposition is the

preferred manner of proceeding, particularly if there is to be any meaningful appellate

review of the ensuing order. Nevertheless, in certain situations, an appellate court may

still review an order based on oral opposition alone, so long as the motion court did not

treat the party orally opposing the motion as being in default, and set forth in its order

exactly what arguments were orally presented.”

Pac Fung Feather Co., Ltd. v. Porthault NA LLC, 140 A D 3d 576 (1st Dept. 2016) – The

Court rejects the argument that the appeal is untimely, “since none of the copies of the

orders annexed to various instruments served below were stamped by a clerk with the

date and place of entry, nor did the instruments themselves draw attention to the entry

and note such a date.” Thus, service of the notice of entry – triggering the running of the

time in which to notice an appeal – was never made.

RENEWAL, REARGUMENT AND RESETTLEMENT

Matter of Quattrone v. Erie 2-Chautaudqua-Cattaraugus Board of Cooperative

Educational Services, 148 A D 3d 1553 (4th Dept. 2017) – “As a general rule, any

motion affecting a prior order, including a motion for leave to reargue a prior motion,

must be made ‘to the judge who signed’ the prior order, ‘unless he or she is for any

reason unable to hear it’ [citations omitted]. However, an exception to that statutory

mandate ‘exists where the Rules of the Chief Administrator of the Courts provide

otherwise [citations omitted], including those rules establishing and implementing the

IAS system. The IAS rules provide that ‘all motions,’ including those governed by

CPLR 2221, ‘shall be returnable before the assignment judge’ [citation omitted]. Thus,

‘by adoption of the IAS “the CPLR 2221 requirement of referral of motions to a Judge

who granted an order on a prior motion has been modified to provide for consistency


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with the mandate of the IAS that all motions in a case shall be addressed to the assigned

Judge.”’”

Rice v. Rice, 135 A D 3d 928 (2d Dept. 2016) – “CPLR 2221 does not permit reargument

of a decision made after trial and is limited to review of a court’s ruling on a prior

motion.” The appropriate remedy to set aside a decision after trial is a motion pursuant to

CPLR 4405, which must be made within 15 days of the decision.

Matter of Franco Belli Plumbing and Heating and Sons, Inc. v. New York City School

Construction Authority, 142 A D 3d 1011 (2d Dept. 2016) – “Since ‘a judgment

dismissing a CPLR article 78 petition is a final judgment terminating the proceeding,’

CPLR 2221 is not the proper procedural mechanism to address the judgment.” Rather, an

application to vacate the judgment pursuant to CPLR 5015 is required.

One Westbank, FSB v. Rodriguez, N.Y.L.J., 1202792787794 (Sup.Ct. Bronx Co. 2017)

(González, J.) – “A motion to reargue must be made within 30 days after service of a

copy of the order determining the prior motion and written notice of its entry [citation

omitted]. On June 2, 2016, defendants e-filed a copy of the May 24, 2016 Order with

Notice of Entry. Plaintiff e-filed a motion for reargument on July 5, 2016. Defendants

contend that plaintiff’s summary judgment is untimely because its 30-day period for

reargument expired on July 2, 2016. Plaintiff contends that the 30-day period was

extended pursuant to General Construction Law §20-a because July 2, 2016 was a

Saturday, the following Monday was July 4th, a holiday. General Construction Law §20-

a(1) provides that when any period of time falls on a Saturday, Sunday or public holiday,

such act may be done on the next succeeding business day. Defendants argue that no

such extension is available since Uniform Rule 202.5(d)(3)(i) provides that electronically

filed documents may be transmitted at any time of night or day to the NYCEF site. No

citation is proffered to buttress their argument. The court accordingly declines to adopt

defendants’ narrow construct. Plaintiff’s motion to reargue is deemed timely filed.”

Vanderbilt Brookland LLC v. Vanderbilt Myrtle, Inc., 147 A D 3d 1106 (2d Dept. 2017) –

“A motion for leave to reargue ‘shall be based upon matters of fact or law allegedly

overlooked or misapprehended by the court in determining the prior motion, but shall not

include any matters of fact not offered on the prior motion’ [citation omitted]. ‘Motions

for reargument are addressed to the sound discretion of the court which decided the prior

motion and may be granted upon a showing that the court overlooked or misapprehended

the facts or law or for some other reason mistakenly arrived at its earlier decision’

[citations omitted]. Contrary to the defendants’ contentions, the Supreme Court

providently exercised its discretion in granting that branch of Brookland’s motion which

was for leave to reargue, upon its determination that, in deciding the prior motion, it had

overlooked a provision of the purchase and sale agreement which prohibited the

recording of that agreement or any memorandum thereof.”


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Country Wide Home Loans, Inc. v. Dunia, 138 A D 3d 533 (1st Dept. 2016) – After

Supreme Court granted defendant’s motion – upon plaintiff’s default – to dismiss the

action for plaintiff’s failure to take steps to obtain a default judgment within a year of

defendant’s default in appearing in the action, pursuant to CPLR 3215(c), plaintiff moved

to renew, and upon renewal to deny the motion to dismiss. “The court properly denied

plaintiff’s motion since the prior order was granted on default, and the proper remedy for

plaintiff was to move to vacate the default pursuant to CPLR 5015, rather than by motion

to renew.”

Hernandez v. Nwaishienyi, 148 A D 3d 684 (2d Dept. 2017) – “‘A motion for leave to

renew shall be based upon new facts not offered on the prior motion that would change

the prior determination and shall contain reasonable justification for the failure to present

such facts on the prior motion’ [citations omitted]. The new or additional facts presented

‘either must have not been known to the party seeking renewal or may, in the Supreme

Court’s discretion, be based on facts known to the party seeking renewal at the time of

the original motion’ [citations omitted]. ‘However, in either instance, a reasonable

justification for the failure to present such facts on the original motion must be presented’

[citations omitted]. ‘Although the requirement that a motion for renewal must be based

on new facts is a flexible one, a motion to renew is not a second chance freely given to

parties who have not exercised due diligence in making their first factual presentation’

[citations omitted]. Accordingly, ‘the Supreme Court lacks discretion to grant renewal

where the moving party omits a reasonable justification for failing to present the new

facts on the original motion.’”

Barbieri v. Miles, 140 A D 3d 1692 (4th Dept. 2016) – “Although a court has discretion

to grant a motion for leave to renew ‘in the interest of justice, upon facts which were

known to the movant at the time the original motion was made,’ it may not exercise that

discretion unless the movant establishes a reasonable justification for the failure to

present such facts on the prior motion.’”

Amtrust-NP SFR Venture, LLC v. Vazquez, 140 A D 3d 541 (1st Dept. 2016) – “The court

also properly denied defendant’s motion on the ground that he offered no justification

whatsoever as to why he did not obtain the new evidence in time to submit it in

opposition to plaintiff’s original motion, and did not assert that he made any effort, let

alone a diligent effort, to obtain this new evidence, which was readily available.”

Matter of Kopicel v. Schnaier, 145 A D 3d 599 (1st Dept. 2016) – “Renewal should have

been denied where, as here, respondents offered no reasonable justification for failing to

proffer the ‘newly discovered’ evidence on the original order to show cause, when that

evidence had been in their possession for years [citations omitted]. It was further an

abuse of discretion to allow renewal where respondents used it as an opportunity to

change legal theories, after they had the court’s initial decision.”


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Trigoso v. Correa, 150 A D 3d 1041 (2d Dept. 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.”

Commissioners of the State Insurance Fund v. NY Minute Management Corp., 143 A D

3d 407 (1st Dept. 2016) – “Even if [plaintiff] SIF was not reasonably justified in

submitting revised audit reports with its motion to renew, which it claims could only be

generated after the court’s finding on the initial motion for summary judgment that the

drivers used by defendants were independent contractors, and thus not subject to

defendants’ workers’ compensation policy with SIF, it was an appropriate exercise of the

motion court’s discretion to grant the motion to renew in the interest of justice.”

490-492 Amsterdam Avenue Housing Development Fund Corporation v. O’Neal,

144 A D 3d 585 (1st Dept. 2016) – “Even if the ‘new facts not offered on the prior

motion’ were available to plaintiff at the time [citation omitted], the court exercised its

discretion providently in granting plaintiff’s motion for renewal in the interest of justice.”

Castor v. Cuevas, 137 A D 3d 734 (2d Dept. 2016) – “What is considered a ‘reasonable

justification’ [for the failure to submit the additional facts on the original motion] is

within the Supreme Court’s discretion [citations omitted]. ‘Law office failure can be

accepted as a reasonable excuse in the exercise of the court’s sound discretion.’” Here,

“the excuse of law office failure presented by the plaintiff was reasonable under the

circumstances.”

Brannon v. O’Neill, N.Y.L.J., 1202767130133 (Sup.Ct. N.Y.Co. 2016)(Bluth, J.) –

Plaintiff failed to demonstrate a reasonable excuse for failing to provide the medical

records that are the basis of this motion to renew upon the original motion. “Plaintiff’s

counsel simply states that he somehow thought that the DHD Medical records were

already before the Court. This is not a reasonable excuse; a cursory review of plaintiff’s

own opposition papers would have shown that the DHD Medical records were not

annexed to his opposition to defendant’s cross-motion or any other documents submitted

in connection with motion practice.” Moreover, plaintiff’s reliance on CPLR 2005,

which permits “law office failure” as an excuse for a default, does not aid him. “CPLR

2005, by its express terms, only applies to motions made pursuant to CPLR 3012(d)

(motions for extension of time to appear or plead) or CPLR 5015(a)(motions to vacate a

default judgment). Here, plaintiff does not seek relief under either of these sections;


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instead, he wants to correct a deficiency in his opposition to defendant’s threshold cross-

motion.”

Priant v. New York City Transit Authority, 142 A D 3d 491 (2d Dept. 2016) – “On a

postappeal motion for leave to renew, the movant bears a heavy burden of showing due

diligence in presenting the new evidence to the Supreme Court.”

Joseph v. Baksh, 137 A D 3d 1220 (2d Dept. 2016) – “Resettlement is generally intended

to remedy clerical errors or clear mistakes in an order or judgment when there is no

dispute about the substance of what that order or judgment should contain [citation

omitted]. It may be used where the order improperly reflects the decision or fails to

include necessary recitals, but cannot be used to obtain a ruling not adjudicated on the

original motion or to modify the decision which has been made [citations omitted]. Here,

in granting the defendants’ motion to resettle the order dated July 26, 2013, the Supreme

Court improperly changed the substance of that order. Although that order stated that the

plaintiff had only raised triable issues of fact regarding certain body parts, it stated

unambiguously that ‘the motion for summary judgment is denied.’ In granting the

defendants’ motion to resettle the order, the Supreme Court changed this outcome by, in

effect, granting the motion to the extent that it related to body parts other than the

plaintiff’s left shoulder and right hip. This is not the correction of a clerical error.

Accordingly, the Supreme Court should have denied the defendants’ motion.”

Jamaica Dedicated Medical Care, P.C. v. Tri-State Consumer Insurance Co., 52 Misc 3d

12 (App.Term 2d Dept. 2016) – Civil Court should have granted “defendant’s motion

seeking to resettle the order entered September 15, 2010 so as to delete the notation on

that order stating that it was made on ‘consent’ and is ‘not appealable.’” The motion was

a proper motion to resettle, and denial was appealable, “as defendant did not seek to

change the substantive decretal portions of the September 15, 2010 order, but rather to, in

essence, correct a factual recitation of that order.”

SEALING THE FILE

People ex rel. Qui Tam “The Bayrock Qui Tam Litigation Partnership” v. Bayrock

Group LLC, N.Y.L.J., 1202780892800 (Sup.Ct. N.Y.Co. 2017)(Singh, J.) – Individual

defendants seek an order permitting them to file their tax return documents in this action

under seal. The motion is granted. “Uniform Rules for Trial Courts (22 NYCRR)

section 216.1(a) provides that ‘a court shall not enter an order in any action or proceeding

sealing the court records, whether in whole or in part, except upon a written finding of

good cause, which shall specify the grounds thereof.’” And, “‘although the term “good

cause” is not defined, a sealing order should clearly be predicated upon a sound basis or

legitimate need to take judicial action’ [citation omitted]. ‘A finding of “good cause”


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presupposes that public access to the documents will likely result in harm to a compelling

interest of the movant’ [citation omitted]. Courts have consistently granted sealing orders

when the information sought to be sealed touches on a matter traditionally treated

confidentially, such as personal medical records [citation omitted]. Like medical records,

tax returns contain confidential, sensitive information. Medical records contain private

information about our personal health. Likewise, tax records contain private information

about our personal finances. Here, defendants maintain that: a) many of the underlying

tax return documents are jointly-filed returns; and b) the privacy interests of spouses who

are not parties to this litigation are in jeopardy. Accordingly, we find that defendants

have a legitimate expectation of privacy. By contrast, the plaintiff/relator has not

adequately identified any genuine, substantial public interest that would be served by

public access to the non-public information of the defendants. Where, as here, a sealing

order preserves the confidentiality of materials involving the internal finances of a party

and are of minimal public interest, good cause has been shown for documents to be filed

under seal.”

State ex rel. Banerjee v. Moody’s Corporation, 54 Misc 3d 705 (Sup.Ct. N.Y.Co. 2017)

(d’Auguste, J.) – A qui tam action is “placed under seal at its inception” under State

Finance Law §190(2)(b). But “the law requires that a qui tam complaint be unsealed if

the State has decided to participate in the qui tam action [citation omitted] or if the

plaintiff relator intends to proceed with the action, after the State and, if applicable, local

municipality, decline to participate.” Here, “because the State and City have both

declined to participate, the issue of whether the instant matter should be under seal is

governed by the same laws as with any other action – specifically, 22 NYCRR 216.1(a).”

Under that provision, “‘confidentiality is clearly the exception, not the rule, and the party

seeking to seal court records has the burden to demonstrate compelling circumstances to

justify restricting public access.’” While anonymity of a qui tam plaintiff may be

“justified in ‘compelling situations involving “highly sensitive matters” including “social

stigmatization,” real danger of “physical harm,” or “where the injury litigated against

would occur as a result of the disclosure of the plaintiff’s identity,”’” no such showing

has been made here.

SANCTIONS

CONTEMPT

Board of Directors of Windsor Owners Corp. v. Platt, 148 A D 3d 645 (1st Dept. 2017) –

“The validity of an order underlying a contempt proceeding may not be attacked except

on the ground that the court entering it was without jurisdiction to do so or that the order

had been stayed [citations omitted]. Accordingly, defendant’s arguments designed to

collaterally attack the preliminary injunction order will not be entertained.”


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People v. John, 150 A D 3d 889 (2d Dept. 2017) – “‘“To sustain a finding of criminal

contempt based on an alleged violation of a court order it is necessary to establish that a

lawful order of the court clearly expressing an unequivocal mandate was in effect” and

the order was disobeyed by a person having knowledge of the order’ [citations omitted].

The defendant’s knowledge of the terms of the order, as opposed to mere issuance of the

order, is an essential element of the crime [citation omitted]. Here, the People presented

evidence that the defendant had knowledge of the issuance of the order of protection, and

was told generally by the Supreme Court: ‘You’re getting a full order of protection; no

contact with the complaining witness.’ However, there was no evidence that the order of

protection, which was not signed by the defendant, was ever actually given to him, or that

he was orally advised as to the contents of the order, including a handwritten condition

that he would be in violation of the order if he came within 100 yards of the complainant,

even if invited by her. Under these circumstances, viewing the evidence in the light most

favorable to the People [citation omitted], there was insufficient evidence from which a

rational jury could conclude that the defendant had written or oral notice of the contents

of the order of protection and the conduct it prohibited.”

Rush v. Save My Home Corp., 145 A D 3d 930 (2d Dept. 2016) – Supreme Court found

defendant guilty of criminal contempt, and “imposed an intermittent sentence of 10

consecutive weekends in the Nassau County Correctional Center.” The Appellate

Division reverses. “Although the Supreme Court properly found the appellant to be in

criminal contempt, the sentence imposed is invalid. The maximum punishment

prescribed for criminal contempt is a definite sentence not to exceed 30 days.” Here, “in

imposing an intermittent sentence, the Supreme Court was bound by the procedures

applicable to intermittent sentences under the Penal Law [citations omitted]. Pursuant to

Penal Law §85.00(3), a sentence of intermittent imprisonment ‘may be for any term that

could be imposed as a definite sentence of imprisonment for the offense for which such

sentence is imposed. The term of the sentence shall commence on the day it is imposed

and shall be calculated upon the basis of the duration of its term, rather than upon the

basis of the days spent in confinement, so that no person shall be subject to any such

sentence for a period that is longer than a period that commences on the date the sentence

is imposed and ends on the date the term of the longest definite sentence for the offense

would have expired.’ The sentence imposed here violates the Penal Law by extending

the incarceration of the appellant beyond the period of 30 days from the day of

sentencing.”

S.P.Q.R. Co., Inc. v. United Rockland Holding Company, Inc., 136 A D 3d 610 (2d Dept.

2016) – “A court’s power to punish for civil contempt is found in Judiciary Law

§753(A)(3) [citation omitted]. ‘To sustain a finding of civil contempt, a court must find

that the alleged contemnor violated a lawful order of the court, clearly expressing an

unequivocal mandate of which that party had knowledge, and that, as a result of the

violation, a right of a party to the litigation was prejudiced’ [citations omitted]. Here,


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contrary to the defendants’ contentions, the judgment dated January 6, 2010, only

declared the ‘courses and distances defining defendants’ property’ as reflected in two

maps; it did not contain an unequivocal mandate such as an injunction [citations omitted].

As such, the plaintiffs cannot be found in contempt of the judgment.”

Dotzler v. Buono, 144 A D 3d 1512 (4th Dept. 2016) – “A finding of civil contempt must

be supported by four elements: (1) ‘a lawful order of the court, clearly expressing an

unequivocal mandate, was in effect’; (2) ‘it must appear, with reasonable certainty, that

the order has been disobeyed’; (3) ‘the party to be held in contempt must have had

knowledge of the court’s order, although it is not necessary that the order actually have

been served upon the party’; and (4) ‘prejudice to the right of a party to the litigation

must be demonstrated’ [citation omitted]. The party seeking an order of contempt has the

burden of establishing those four elements by clear and convincing evidence [citations

omitted]. Here, we agree with defendant that plaintiff failed to establish by the requisite

clear and convincing evidence that defendant had actual knowledge of the TRO at the

time he spent the proceeds from the sale of the mobile home [citation omitted]. We reject

plaintiff’s contention that defendant’s actual knowledge of the TRO is not necessary here

because she served the TRO upon defendant’s attorney [citation omitted]. ‘Actual

knowledge of a judgment or order is an indispensable element of a contempt proceeding’

[citations omitted], and the record establishes that defendant did not receive the TRO

before he spent the proceeds from the sale of the mobile home.”

S.M.S. v. D.S., 54 Misc 3d 779 (Sup.Ct. Richmond Co. 2016)(DiDomenico, J.) – “In

order to prevail on a motion for civil contempt, the moving party must prove: (1) the

existence of a clear and lawful mandate of the court; (2) that the party alleged to have

disobeyed the Order was aware of its terms, and (3) that the moving party’s rights were

prejudiced [citations omitted]. These elements must be established by the moving party

by clear and convincing evidence [citations omitted]. While ‘willfulness’ is an essential

element for a finding of ‘criminal contempt,’ the mere act of disobedience, regardless of

motive, is sufficient to establish ‘civil contempt’ if such disobedience ‘defeats, impairs,

impedes, or prejudices the rights or remedies of a party.’ Therefore a showing of

willfulness is unnecessary for a finding of civil contempt” [emphasis by the Court].

4720 15th Avenue LLC v. Jacobson, N.Y.L.J. 1202781884338 (Sup.Ct. N.Y.Co.

2017)(Levy, J.) – In the course of seeking to enforce a judgment, plaintiff served an

information subpoena on defendant, and seeks to hold defendant in civil contempt for his

failure to comply. The subpoena is a “non-judicial” subpoena, for “what distinguishes a

judicial from a non-judicial subpoena is where it is returnable.” Judicial subpoenas “are

those returnable in a court, and non-judicial subpoenas are those which are not returnable

in a court.” A non-judicial subpoena, as here, is governed by CPLR 2308(b), which

provides that when a person fails to comply with such a subpoena, the serving party “may

move in the supreme court to compel compliance.” Thus, “in the case of judicial


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subpoenas, a person who fails to comply runs the risk of being held in contempt based

directly on that failure to comply [citation omitted]. In contrast, a person who is served

with a non-judicial subpoena cannot be held in contempt for failure to comply unless and

until a court has issued an order compelling compliance, which order has been

disobeyed.” However, upon the defendant’s failure to comply with a non-judicial

subpoena, the Court “may impose costs and a penalty, each not to exceed $50.00, as well

as damages sustained by reason of the failure to comply.”

Matter of Fitzgerald (Rahmanan), 144 A D 3d 906 (2d Dept. 2016) – “Once the party

moving to hold another party in civil contempt establishes a knowing failure to comply

with a clear and unequivocal mandate, the burden shifts to the alleged contemnor to

refute the movant’s showing, or to offer evidence of a defense, such as an inability to

comply with the order [citation omitted]. A hearing is required only if the papers in

opposition raise a factual dispute as to the elements of civil contempt, or the existence of

a defense.”

Cantalupo Construction Corp. v. 2319 Richmond Terrace Corp., 141 A D 3d 626 (2d

Dept. 2016) – “Absent certain exceptions not applicable here, civil contempt is not

appropriate for the enforcement of a monetary judgment, which can be secured under the

provisions of article 52 of the CPLR.”

Matter of Gonnard v. Guido, 141 A D 3d 649 (2d Dept. 2016) – “Judiciary Law §773

permits recovery of attorney’s fees from the offending party by a party aggrieved by

contemptuous conduct [citations omitted]. The intent of Judiciary Law §773 is to

indemnify the aggrieved party for costs and expenses incurred as a result of the contempt

[citations omitted]. Attorney’s fees that are documented and directly related to the

contemptuous conduct are generally recoverable unless they are proven excessive or

reduced by the court in a reasoned decision.”

McCarthy v. Ciano, 50 Misc 3d 861 (Sup.Ct. Putnam Co. 2015)(Grossman, J.) – The

automatic stay provided by 11 USC §362 upon the filing of a bankruptcy petition does

not stay an application for criminal contempt. Such an application comes within the

federal statute’s exception for “a criminal action or proceeding against the debtor.”

Community Preservation Corporation v. Northern Blvd. Property, LLC, 139 A D 3d 889

(2d Dept. 2016) – “The Supreme Court erred in granting the receiver’s motion to hold the

appellant in civil contempt. Pursuant to Judiciary Law §756, a contempt application must

be in writing, must be made upon at least 10 days’ notice, and must contain on its face the

statutory warning that ‘FAILURE TO APPEAR IN COURT MAY RESULT IN

IMMEDIATE ARREST AND IMPRISONMENT FOR CONTEMPT OF COURT.’

Although the receiver’s motion was in writing and complied with the 10-day notice

requirement, it did not comply with the warning requirement. As such, the court was


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without jurisdiction to punish the appellant for contempt for failing to comply with its

prior order.”

Matter of Hartwich v. Chauvin, 140 A D 3d 1336 (3d Dept. 2016) – “A CPLR article 78

proceeding is an appropriate vehicle for review of an order of contempt when the conduct

giving rise to the contempt occurred ‘in the immediate view of the court’ and, as a result,

the court summarily punished the contemnor [citations omitted]. However, relief under

CPLR article 78 is not available where the misconduct occurred outside the presence of

the court, the finding of contempt was ‘made after due warning upon a record adequate

for appellate review’ and the contemnor was afforded ‘an opportunity to purge himself or

herself of the contempt’ [citations omitted]. In such cases, the contemnor must challenge

the order of contempt by way of a direct appeal.”

OTHER SANCTIONS

Lewis, Brisbois, Bisgaard & Smith, LLP v. Law Firm of Howard Mann, 141 A D 3d 574

(2d Dept. 2016) – “New York does not recognize an independent cause of action for the

imposition of sanctions relating to frivolous actions.”

Baxter v. Javier, 140 A D 3d 683 (2d Dept. 2016) – “CPLR 8303-a provides, in pertinent

part, that where, as here, a plaintiff has commenced a ‘frivolous’ claim in an action to

recover damages for injury to property, ‘the court shall award to the successful party

costs and reasonable attorney’s fees not exceeding ten thousand dollars.’ Thus, the

plaintiff is correct that the Supreme Court erred in basing its award on both CPLR 8303-a

and 22 NYCRR part 130, and in awarding attorney’s fees and costs in excess of the

statutory limit set forth in CPLR 8303-a [citation omitted]. Similarly, the court erred in

imposing a sanction upon the plaintiff pursuant to 22 NYCRR 130-1.1. However,

contrary to the contention of the plaintiff, the Supreme Court was not limited to making

only one $10,000 award under CPLR 8303-a. The statute specifically permits an award

of up to $10,000 to ‘the successful party’ against whom a frivolous claim is asserted.

Here, the plaintiff interposed frivolous claims for punitive damages against each of the

two defendants, and consequently, there are two ‘successful parties’ within the meaning

of CPLR 8303-a. Thus, each defendant is entitled to a separate award under CPLR 8303-

a of up to $10,000.”

Board of Managers of Foundry at Washington Park Condominium v. Foundry

Development Co., Inc., 142 A D 3d 1124 (2d Dept. 2016) – Last year’s “Update”

reported on Supreme Court’s decision in this matter [44 Misc 3d 550 (Sup.Ct. Orange

Co. 2014)]. Supreme Court held that, upon a finding of frivolous conduct, a Court may

award attorney’s fees as “costs,” even when the injured party will not itself be required to

pay those fees. “The purpose of the fee award was to compensate BSRB for the costs

incurred in defending itself against a frivolous action. The nature of the fee arrangement

between BSRB and its counsel does not provide a basis upon which Mr. Suarez can


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escape enforcement of the attorney’s fee award.” And “the fact that BSRB was

represented, in part, by counsel obtained and paid for by its malpractice carrier should not

inure to Mr. Suarez’s benefit.” The Appellate Division has affirmed. “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.’”

Moreover, “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.’”

Delidimitropoulos v. Karantinidis, 142 A D 3d 1038 (2d Dept. 2016) – “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.”

Place v. Chaffee-Sardinia Volunteer Fire Company, 143 A D 3d 1271 (4th Dept. 2016) –

“Pursuant to 22 NYCRR 130-1.1(a), a court may award to any party fees and costs

resulting from frivolous conduct, i.e., conduct that is ‘completely without merit in law

and cannot be supported by a reasonable argument for an extension, modification or

reversal of existing law; or that is undertaken primarily to delay or prolong the resolution

of the litigation, or to harass or maliciously injure another; or asserts material factual

statements that are false’ [citation omitted]. Factors to consider in determining whether

the conduct undertaken was frivolous include ‘the circumstances under which the

conduct took place,’ and whether ‘the conduct was continued when its lack of legal or

factual basis was apparent, should have been apparent, or was brought to the attention of

counsel or the party’ [citation omitted]. 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 sanction pursuant to 22 NYCRR 130-1.1, and we remit

the matter to Supreme Court for the determination of an appropriate sanction.”


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SEALING OF COURT FILES

Maxim, Inc. v. Feifer, 145 A D 3d 516 (1st Dept. 2016) – “This Court has previously held

that there is a ‘broad presumption that the public is entitled to access to judicial

proceedings and court records’ [citations omitted]. The right of public access includes

the right of the press to read and review court documents, unless those documents have

been sealed pursuant to a statutory provision or by a properly issued sealing order.”

Further, “because confidentiality is the exception and not the rule [citations omitted], ‘the

party seeking to seal court records has the burden to demonstrate compelling

circumstances to justify restricting public access.’” Here, “it appears that the motion

court sealed the second action because the parties stipulated to it. Before sealing, the

motion court should have made its own written finding of good cause, as is required by

the provisions of the Uniform Rules for Trial Courts (22 NYCRR) §216.1(a).”

Matter of Levy, N.Y.L.J., 1202754584966 (Surr.Ct. Dutchess Co. 2016)(Pagones, J.) –

“‘There is a presumption that the public has the right of access to the courts to ensure the

actual and perceived fairness of the judicial system, as the bright light cast upon the

judicial process by public observation diminishes the possibilities for injustice,

incompetence, perjury, and fraud’ [citation omitted]. Since confidentiality is the

exception, the court must make an independent determination of whether to seal court

records in whole or in part for ‘good cause’ [citation omitted]. This task involves

weighing the interests of the public against the interests of the parties [citation omitted].

The party seeking to seal documents must demonstrate compelling circumstances

[citation omitted]. A finding of ‘good cause’ presupposes that public access to the

documents at issue will likely result in harm to a compelling interest of the movant and

that no alternative to sealing can adequately protect the threatened interest [citation

omitted]. Here, the record is devoid of any justification for prohibiting disclosure of any

of the terms of the settlement other than the parties’ settlement is contingent upon an

agreement of confidentiality. While there is a strong public interest in encouraging the

settlement of private disputes, conclusory claims of the need for confidentiality of

settlement agreements are insufficient to seal a record.”

STAYING AN ACTION

Mook v. Homesafe America, Inc., 144 A D 3d 1116 (2d Dept. 2016) – “A motion

pursuant to CPLR 2201 to stay a civil action pending resolution of a related criminal

action is directed to the sound discretion of the trial court [citations omitted]. ‘Factors to

consider include avoiding the risk of inconsistent adjudications, duplication of proof and

potential waste of judicial resources. A compelling factor is a situation where a

defendant will invoke his or her constitutional right against self incrimination’ [citations


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omitted]. ‘Although the pendency of a criminal proceeding does not give rise to an

absolute right under the United States or New York State Constitutions to a stay of a

related civil proceeding there is no question but that the court may exercise its discretion

to stay proceedings in a civil action until a related criminal dispute is resolved’ [citation

omitted]. Here, this action and the criminal action against Samuel arise from the same

facts. While a stay may cause inconvenience and delay to the plaintiffs, the failure to

grant the stay would cause Samuel to ‘suffer the severe prejudice of being deprived of a

defense’ [citations omitted]. Moreover, a prior determination in the criminal proceeding

could have collateral estoppel effect in this action, thereby simplifying the issues [citation

omitted]. Accordingly, the Supreme Court providently exercised its discretion by, in

effect, granting a stay of the action insofar as asserted against Samuel pending resolution

of the related criminal proceeding against him.”

PROVISIONAL REMEDIES

ATTACHMENT

Hume v. 1 Prospect Park ALF, LLC, 137 A D 3d 1080 (2d Dept. 2016) – “Attachment is

a provisional remedy designed to secure a debt by preliminary levy upon the property of

the debtor to conserve it for eventual execution, and the courts have strictly construed the

attachment statute in favor of those against whom it may be employed [citations omitted].

In order to be granted an order of attachment under CPLR 6201(3), a ‘plaintiff must

demonstrate that the defendant has concealed or is about to conceal property in one or

more of several enumerated ways, and has acted or will act with the intent to defraud

creditors, or to frustrate the enforcement of a judgment that might be rendered in favor of

the plaintiff’ [citations omitted]. In addition to proving fraudulent intent, the plaintiff

must show a probability of success on the merits.” Here, plaintiff made an adequate

showing to warrant issuing an order of attachment, but “under the circumstances of this

case, the $500 bond fixed by the Supreme Court as an undertaking was inadequate to

protect the defendant’s interest during the pendency of this action [citations omitted],

and, accordingly, we increase it” to $2,500.

Citibank, N.A. v. Keenan Powers & Andrews PC, 149 A D 3d 484 (1st Dept. 2017) –

Having succeeded on the merits of the action, defendant “is entitled to the damages it

suffered as a result of the wrongful attachment [citation omitted]. 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).”


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PRELIMINARY INJUNCTION

Punwaney v. Punwaney, 148 A D 3d 489 (1st Dept. 2017) – “This action concerns the

disposition of assets held in several foreign bank accounts after the death of the primary

account holder.” Plaintiff “seeks to enjoin defendants from withdrawing or transferring

funds from the accounts.” CPLR 6301 “authorizes preliminary injunctive relief enjoining

violations of the plaintiff’s rights ‘respecting the subject of the action.’ The ‘subject of

the action’ requirement is satisfied here, because plaintiff claims entitlement to a specific

fund – namely the foreign bank accounts.”

Matter of Ezrine, N.Y.L.J., 1202784574131 (Surr.Ct. N.Y.Co. 2017)(Anderson, J.) –

“This is a contested administrator’s accounting in the estate of Ivan Ezrine. At issue is

the ownership of shares of a corporation which, in turn, owns a brownstone in

Manhattan.” The objectants assert that is an estate asset. The administrator contends

that, by agreement, she became owner of decedent’s interest in the corporation.

Objectants seek to enjoin the administrator from selling the brownstone. That motion is

denied. “According to movants, a preliminary injunction is necessary because the

administrator is marketing the brownstone before their interest in the Corporation has

been adjudicated. They challenge the bona fides of the Agreement as the basis for their

position and seek to preserve the status quo pending final disposition. They argue that,

once the administrator sells the Brownstone, ‘she can use the proceeds to pay for her

expenses – with no cap – until they are completely depleted.’ Movants also claim that

the administrator is prepared to sell the brownstone below its market value. This state of

affairs, they assert, constitutes ‘irreparable harm.’” However, “the injury that movants

describe is purely a monetary one. Movants do not seek preservation of the brownstone

for their use. They do not propose that they would buy the administrator’s interest in the

brownstone in the event they prevail on their objections.” Rather, “they request a

preliminary injunction as security for the surcharge they seek in this proceeding. The law

is clear, however, that injury ‘compensable in money and capable of calculation, albeit

with some difficulty, is not irreparable harm.’”

Canales v. Finger, 147 A D 3d 549 (1st Dept. 2017) – “The IAS court did not abuse its

discretion in setting an undertaking at $250,000 for the T[emporary] R[estraining

O[rder]. Based on the record before the court, this amount was reasonably related to

defendants’ potential harm from the pendency of the TRO [citation omitted]. However,

the court erred in vacating the undertaking when it denied the preliminary injunction and

dissolved the TRO. The purpose of the undertaking is to provide a source of recovery to

the nonmovant for damages suffered from the pendency of the restraint [citation omitted].

As such, the undertaking should be reinstated, in the amount of $250,000, pending a

determination of defendants’ damages, if any, from the pendency of the TRO.”

Rose v. Egan, N.Y.L.J., 1202763654560 (Sup.Ct. N.Y.Co. 2016)(Bannon, J.) – The Court

grants plaintiffs’ motion “to preliminarily enjoin the defendant from publishing


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communications which defame or disparage them or their businesses.” These

communications are not protected by the First Amendment, and “the potential harm

caused by defendant’s continued communications is irreparable, as it is capable of

injuring Rose’s reputation in all aspects of his personal and professional life.” And, “as

detailed in Rose’s affidavit, the degree of harm to be caused to plaintiffs if the conduct

continues unabated far exceeds any which may be caused to defendant if her publication

of the offending communications is enjoined pending the trial.”

Town of Brookhaven v. MMCCAS Holdings, Inc., 137 A D 3d 1258 (2d Dept. 2016) –

“‘To obtain preliminary injunctive relief based on a violation of its zoning ordinances, a

town need not satisfy the traditional three-part test for injunctive relief, but is required

“only to show that it has a likelihood of ultimate success on the merits and that the

equities are balanced in its favor”’ [citations omitted]. Here, although the Town

ultimately may be successful in this action, it failed to demonstrate that the balance of the

equities weighed in its favor. While the harm to the defendants if the injunction is

granted would prove substantially burdensome and likely irreversible, the harm to the

Town should the injunction be denied is more remote and uncertain [citations omitted].

Indeed, the Town’s evidence suggests that the defendants have been conducting

substantial composting and mulch-processing activities on the property since at least

2007. Further, granting the injunction would disturb the status quo, rather than maintain

it.”

Zoller v. HSBC Mortgage Corporation (USA), 135 A D 3d 932 (2d Dept. 2016) – “‘A

mandatory injunction, which is used to compel the performance of an act, is an

extraordinary and drastic remedy which is rarely granted and then only under unusual

circumstances where such relief is essential to maintain the status quo pending trial of the

action.” In this action by neighbors of the subject property, seeking to compel

remediation of conditions on that property, the Court denies a preliminary mandatory

injunction, concluding that “plaintiffs failed to demonstrate that the circumstances were

of such an extraordinary nature as to warrant mandatory injunctive relief pending the

resolution of the action.”

Pureform Movement, LLC v. 2374 Concourse Associates, LLC, N.Y.L.J., 1202773324891

(Sup.Ct. N.Y.Co. 2016)(Kenney, J.) – “A Yellowstone injunction maintains the status quo

so that a commercial tenant, when confronted by a threat of termination of its lease, may

protect its investment in the leasehold by obtaining a stay tolling the cure period so that

upon an adverse determination on the merits the tenant may cure the default and avoid a

forfeiture of the lease [citation omitted]. Additionally, the very nature of this kind of

injunction is designed to ‘forestall the cancellation of a lease to afford the tenant an

opportunity to obtain a judicial determination of its breach, the measures necessary to

cure it, and those required to bring the tenant in future compliance with the terms of the

lease [citations omitted]. To obtain Yellowstone relief a tenant need not show a


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likelihood of success on the merits [citation omitted]. It can simply deny the alleged

breach of its lease [citations omitted]. Yellowstone relief is available to protect against

leasehold forfeiture, provided that the tenant has the ability to cure by means short of

vacatur in the event the tenant is found to be in default of its obligations under a lease

[citation omitted]. This rationale is in line with this State’s public policy against the

forfeiture of leases [citation omitted]. This disinclination against leasehold forfeitures

serves to promote the economy and business in our City. This public policy concern

takes on greater weight when a tenant has asserted that it will diligently and in good faith

attempt to cure the defect, but through no inaction of its own, cannot do so without the

cooperation of defendant [citations omitted]. The Court of Appeals has acknowledged

that Courts routinely grant Yellowstone relief to reflect this State’s previously described

policy against forfeiture, and the Courts have done so by accepting ‘far less than the

normal showing required for preliminary injunctive relief.’”

NOTICE OF PENDENCY

Delidimitropoulos v. Karantinidis, 142 A D 3d 1038 (2d Dept. 2016) – “A notice of

pendency may be filed only when ‘the judgment demanded would affect the title to, or

the possession, use or enjoyment of, real property' [citations omitted]. ‘When the court

entertains a motion to cancel a notice of pendency in its inherent power to analyze

whether the pleading complies with CPLR 6501, it neither assesses the likelihood of

success on the merits nor considers material beyond the pleading itself; ‘the court’s

analysis is to be limited to the pleading’s face’ [citations omitted]. Here, on its face, the

complaint does not seek relief that would affect the title to, or the possession, use or

enjoyment of, real property. The plaintiff alleges that he has an ownership interest in the

defendant Hephaistos Building Supplies, Inc., an entity that is alleged to own the

properties listed in the subject notices of pendency.” Thus, plaintiff does not claim

“ownership interest in the real property itself,” and the claims “do not support the filing

of the notices of pendency.”

Bank of America v. Riccardi, N.Y.L.J., 1202759000512 (Sup.Ct. Suffolk Co. 2016)

(Whelan, J.) – “A conveyance of premises made pursuant to a judgment of foreclosure

and sale ‘is an entire bar against each of them and against each party to the action who

was duly summoned and every person claiming from, through or under a party by title

accruing after the filing of the notice of the pendency of the action.’” And, “it is

axiomatic that a person whose conveyance or encumbrance is recorded after the filing of

a notice of pendency is bound by all proceedings taken in the action after such filing to

the same extent as if he were a party [citations omitted], and a person holding an interest

that accrued prior to the filing of a notice of pendency, but not recorded until after the

filing of such notice, is also bound.”

Stout Street Fund I, L.P. v. Halifax Group, LLC, 148 A D 3d 749 (2d Dept. 2017) –

“‘Pursuant to CPLR 6501, the filing of a notice of pendency provides constructive notice


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of an action in which the judgment demanded may affect the title to real property’

[citation omitted]. ‘The statute further provides that a person whose conveyance is

recorded after the filing of a notice of pendency is bound by all proceedings taken in the

action after such filing to the same extent as if he or she were a party’ [citations omitted].

‘A person holding an interest that accrued prior to the filing of a notice of pendency, but

not recorded until after the filing of the notice, is still so bound’ [citation omitted]. ‘In

order to cut off a prior lien, such as a mortgage, the purchaser or encumbrancer must have

no knowledge of the outstanding lien and must win the race to the recording office.’”

Deutsch v. Grunwald, 138 A D 3d 915 (2d Dept. 2016) – “‘A notice of pendency is valid

for three years from the date of filing and may be extended for additional three-year

periods upon a showing of good cause’ [citations omitted]. Here, the plaintiff failed to

establish good cause. In this regard, the plaintiff failed to sufficiently explain the period

of inactivity of more than one year prior to the filing of his motion to extend the notice of

pendency. Under these circumstances, the Supreme Court should have denied the

plaintiff’s motion.”

Sudit v. Labin, 148 A D 3d 1077 (2d Dept. 2017) – “CPLR 6513 provides that a notice of

pendency is valid for three years from the date of filing and may be extended for

additional three-year periods ‘for good cause shown.’ The general rule is that the

extension must be requested, and the extension order ‘filed, recorded and indexed,’

before expiration of the prior notice [citation omitted]. ‘This is an exacting rule; a notice

of pendency that has expired without extension is a nullity’ [citations omitted]. The

general rule does not apply, however, to an action to foreclose a mortgage on real

property. Instead, CPLR 6516(a) specifically provides, in pertinent part, as follows”: ‘In

a foreclosure action, a successive notice of pendency may be filed to comply with section

thirteen hundred thirty-one of the real property actions and proceedings law,

notwithstanding that a previously filed notice of pendency in such action or in a previous

foreclosure action has expired pursuant to section 6513 of this article.’”

ACCELERATED JUDGMENT

CPLR 3211

CitiMortgage, Inc. v. Carter, 140 A D 3d 1663 (4th Dept. 2016) – A Court’s sua sponte

“‘power of dismissal must be restricted to the most extraordinary circumstances’ [citation

omitted], such as ‘a pattern of willful noncompliance with court-ordered deadlines,’ and

no such extraordinary circumstances are reflected in the record before us [citations

omitted]. ‘Although a litigant cannot ignore court orders with impunity, we conclude that

missing a single deadline by one week does not warrant the court’s exercise of its power

to dismiss a complaint sua sponte.’”


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Matter of Sheive v. Holley Volunteer Fire Company, 145 A D 3d 1584 (4th Dept. 2016) –

“Supreme Court improvidently exercised its discretion in sua sponte dismissing the

petition. ‘Use of the sua sponte power of dismissal must be restricted to the most

extraordinary circumstances’ and no such extraordinary circumstances are present in this

case [citations omitted]. In sua sponte dismissing the petition, ‘the court deprived

petitioner of notice of what was effectively the court’s own motion for summary

judgment, thereby depriving her of her opportunity to lay bare her proof and rendering

meaningful appellate review of the propriety of the court’s determination on the merits

impossible.’”

Ray v. Chen, 148 A D 3d 568 (1st Dept. 2017) – “‘The power of a nisi prius court to

dismiss an action sua sponte should be used sparingly and only in extraordinary

circumstances’ [citation omitted]. No such circumstances are present here. In the

absence of notice that plaintiffs would be required to respond to a motion to dismiss, ‘the

court was virtually without jurisdiction to grant the relief afforded to defendant.’”

Zhao v. Liu, 136 A D 3d 1025 (2d Dept. 2016) – At the time it moved to dismiss the

complaint, defendant VisionChina “was in default for failing to answer the complaint

within the 30-day period for service of a responsive pleading [citation omitted].

VisionChina did not seek relief from its default or make any showing of a reasonable

excuse for its default. Under such circumstances, the Supreme Court properly declined to

excuse VisionChina’s default and denied the motion as untimely.”

Chase Home Finance, LLC v. Garcia, 140 A D 3d 820 (2d Dept. 2016) – When they

made their motion to dismiss for lack of standing, defendants were in default in appearing

in the action. They “did not seek an extension of time to answer or appear in this action

[citation omitted], or request an extension of time within which to serve and file a pre-

answer motion pursuant to CPLR 3211 to dismiss the complaint insofar as asserted

against them. Further, they did not attempt to show good cause for their delay, or even

address the timeliness of their motion.” Accordingly, “they waived the defense of lack of

standing,” and Supreme Court properly denied their motion to dismiss.

Fagbuyi v. Accredit Home Lenders, Inc., 140 A D 3d 1011 (2d Dept. 2016) – “Contrary

to plaintiff’s contention, under the circumstances of this case, once the Supreme Court

granted the plaintiff’s motion for leave to serve and file a second amended complaint, it

was not erroneous for the court to consider U.S. Bank’s motion [to dismiss] as being

directed against the second amended complaint.”

Landes v. Provident Realty Partners II, L.P., 137 A D 3d 694 (1st Dept. 2016) – CPLR

3211(e) provides in part that a party may move to dismiss a pleading on “one or more of

the grounds set forth” in CPLR 3211(a), but that “no more than one such motion shall be

permitted.” Here, “given that defendants had the full opportunity to raise their current


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CPLR 3211(a) arguments on their original CPLR 3211(a) motion to dismiss, the IAS

court correctly denied the motion as violative of the ‘single motion rule” of CPLR

3211(e).”

Kinberg v. Schwartzapfel, Novick, Truhowsky, Marcus, PC, 136 A D 3d 431 (1st Dept.

2016) – “Defendant’s motion, properly treated as a motion for summary judgment

[citation omitted], is not precluded by the ‘single motion’ rule [citation omitted].

Although defendant previously moved to dismiss on other grounds, a ‘preanswer motion

to dismiss based on one of the grounds set forth in CPLR 3211(a) does not effect a

waiver of the other grounds set forth in CPLR 3211(a),’ which can then be raised in

support of a motion for summary judgment dismissing the complaint.”

Lin v. Lin, 52 Misc 3d 229 (Sup.Ct. Queens Co. 2016)(Buggs, J.) – Defendant’s answer

contained the affirmative defenses of res judicata and collateral estoppel. After the

answer was stricken “for willful failure to comply with discovery demands, defendant

moved, pursuant to CPLR 3211, to dismiss the complaint on those grounds. The Court

denies the motion. “Defendant cannot now make an end run around his stricken answer

by attempting to raise those defenses in a manner blatantly contrary to statutory

directives.”

Landmark Ventures, Inc. v. Birger, 147 A D 3d 497 (1st Dept. 2017) – “‘A contractual

forum selection clause is documentary evidence that may provide a proper basis for

dismissal pursuant to CPLR 3211(a)(1).’”

Hartnagel v. FTW Contracting, 147 A D 3d 819 (2d Dept. 2017) – “‘Judicial 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,’ qualify

as documentary evidence in proper cases; however, affidavits and letters are not

considered documentary evidence.’”

Gustavia Home, LLC v. Rutty, 2016 WL 6267961 (E.D.N.Y. 2016)(Cogan, J.) –

“Traditionally, the case law has held that, whether applied in state or federal court,

because of the possibility of an unconstitutional infringement of interstate commerce,

BCL 1312(a) required a higher degree of contact with or activity in New York than is

required for the presence of personal jurisdiction under New York CPLR 301 [citations

omitted], even though both tests use the words ‘doing business’ [citation omitted].

However, in light of the Supreme Court’s recent decision in Daimler AG v. Bauman, 134

S.Ct. 746 (2014), where the Court interpreted the due process clause as requiring

sufficiently extensive contacts to support ‘doing business’ for purposes of personal

jurisdiction such that the foreign corporation is essentially ‘at home’ in the forum, it may

be that these positions have become reversed, i.e., that BCL 1312(a) requires a lower

threshold of New York contacts before a license is required than CPLR 301 requires


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before personal jurisdiction can be found.” Thus, “no case law suggests that BCL

1312(a) requires the foreign company to be ‘at home’ in New York. Moreover, there is

some logic in requiring a lower standard of contacts to impose a licensing requirement on

a foreign litigant who voluntarily opts to sue in a New York court as opposed to a foreign

litigant who is involuntarily hailed into New York. It may be that the policy of

encouraging commerce reflected in the interstate commerce clause is less pressing than

the protection of liberty and property interests commanded by the due process clause.”

Small Step Day Care, LLC v. Broadway Bushwick Builders, L.P., 137 A D 3d 1102 (2d

Dept. 2016) – “Limited Liability Company Law §206 requires limited liability companies

to publish their articles of organization or comparable specified information for six

successive weeks in two local newspapers designated by the clerk of the county where

the limited liability company has its principal office, followed by the filing of an affidavit

with the Department of State, stating that such publication has been completed [citations

omitted]. Failure to comply with these requirements precludes a limited liability

company from maintaining any action or special proceeding in New York [citations

omitted]. Here, as the defendants correctly contend, since the plaintiff failed to comply

with the publication requirements of Limited Liability Company Law §206, it is

precluded from bringing the action.” Thus the motion to dismiss, pursuant to CPLR

3211(a)(3), was properly granted.

Insurance Company of North America v. ACCO Material Handling Solutions, Inc.,

N.Y.L.J., 1202782107977 (Sup.Ct. N.Y.Co. 2017)(Bransten, J.) – “CPLR 3211(a)(4)

provides that a party may move to dismiss one or more causes of action asserted against

him or her on the ground that ‘there is another action pending between the same parties

for the same cause of action in a court of any state.’ Whether to grant such dismissal is a

matter of discretion for the court [citations omitted]. ‘New York courts generally follow

the first-in-time rule, which instructs 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]. ‘Where another action is pending, a major concern, as a

matter of comity, is to avoid the potential for conflicts that might result from rulings

issued by courts of concurrent jurisdiction’ [citation omitted]. Dismissal under CPLR

3211(a)(4) is warranted when the relief sought is ‘the same or substantially the same’

with respect to the two pending actions [citation omitted]. This criterion is not met when

‘relief demanded is antagonistic and inconsistent, or purposes of two actions are entirely

different’ [citation omitted]. Further, in order to reach dismissal, ‘it is necessary that

there be sufficient identity as to both the parties and the causes of action asserted in the

respective actions.’”

GE Oil & Gas, Inc. v. Turbine Generation Services, L.L.C., 140 A D 3d 582 (1st Dept.

2016) – “With respect to CPLR 3211(a)(4), as the service of process in the New York

action preceded the service of process in the Louisiana action, the New York court was


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the first to take jurisdiction over this matter [citation omitted]. While the application of

the first-in-time rule is discretionary and not controlling, especially where, as here, the

competing actions were commenced within a short time [citation omitted], there is

another factor that weighs heavily in favor of maintaining jurisdiction in New York: the

New York action is based solely on the loan documents, while the pending Louisiana

action includes claims related to the purported joint venture [citation omitted]. Thus, the

court also providently exercised its discretion in declining to stay the action pursuant to

CPLR 2201.”

Seneca Specialty Insurance Co. v. T.B.D. Capital, LLC, 143 A D 3d 971 (2d Dept. 2016)

– “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.”

Wells Fargo Bank, N.A. v. Peña, 51 Misc 3d 241 (Sup.Ct. Kings Co. 2016)(Demarest, J.)

– “CPLR 3211(a)(4) is applicable to this action since it is undisputed that there is a

pending mortgage foreclosure action by plaintiff on the same debt [pending in New

Jersey]. Plaintiff has made its decision to foreclose on the mortgages and should not be

permitted to commence a second simultaneous action attempting to recover the same debt

before the New Jersey court has made a determination.”

Wachtell, Lipton, Rosen & Katz v. CVR Energy, Inc., 143 A D 3d 648 (1st Dept. 2016) –

Nisi prius “improvidently exercised its discretion in declining to dismiss the claim for a

declaratory judgment against defendant DVR Energy, Inc., since there is another action

pending between the parties for the same cause of action [citations omitted]. CVR’s

choice of a federal forum for its earlier filed legal malpractice action against plaintiff

(Wachtell) [citation omitted] is entitled to comity. Wachtell’s ‘use of a declaratory

judgment action to determine the viability of its defense, or the existence of merit to

CVR’s legal malpractice claim’ is an ‘unusual’ practice [citation omitted], strongly

suggestive of forum shopping, and does not warrant a deviation from the first-to-file

rule.”

IRX Therapeutics, Inc. v. Landry, 150 A D 3d 446 (1st Dept. 2017) – The Appellate

Division affirms Supreme Court’s dismissal of this action “based on the pendency of an

action in federal court in Texas concerning the same alleged contract.” Although this

action was filed first, “chronology is not dispositive, particularly since both actions are at

the earliest stages of litigation [citation omitted], and since the format of this action (i.e.,


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a declaratory judgment action) suggests that it was responsive to defendant’s threat of

litigation [citation omitted]. The record also suggests that plaintiff commenced this

action preemptively in an effort to gain a tactical advantage and deprive defendant of his

choice of forum.”

Quatro Consulting Group, LLC v. Buffalo Hotel Supply Company, Inc., 55 Misc 3d 615

(Sup.Ct. Monroe Co. 2017)(Rosenbaum, J.) – “BHS commenced its action by filing the

summons with notice in Erie County at least six days prior to Quatro commencing its

action in Monroe County. The belated verification and assignment of an index number

by the Erie County Clerk through its efiling systems should not disrupt the first-in-time

rule.” The Court rejects Quatro’s argument that “the Erie County filing was actually not

the ‘first-in-time’ since the filing of a summons with notice only, and not the complaint

does not constitute ‘another action pending,’” even though Quatro “cites several cases

from the First and Second Departments which held that CPLR 304 does not mandate

dismissal as a ‘prior action pending’ where a complaint has not been served.” For, “in

review of those cases, it is unclear why the appellate courts did not follow the clear

statutory language, that ‘an action is commenced by filing a summons and complaint or

summons with notice’ [citation omitted; emphasis by the Court]. The statute is clear that

commencement occurs with either the filing of the summons and complaint, or the filing

of a summons with notice. The Fourth Department in a factually similar case and filing

scenario made such a determination that the filing of a summons with notice was

commencement.”

Cash on the Spot ATM Services, LLC v. Camia, 144 A D 3d 961 (2d Dept. 2016) – Back

in the mid-1970’s, the Court of Appeals decided two important – and perhaps

contradictory – cases setting out the standards for the use of extrinsic material submitted

on motions to dismiss for failure to state a cause of action under CPLR 3211(a)(7). In

Rovello v. Orofino Realty Co., Inc., 40 N Y 2d 633 (1976), the Court, split 5-2, held that,

when a motion to dismiss is not converted into a summary judgment motion [CPLR

3211(c)], “affidavits may be received for a limited purpose only, serving normally to

remedy defects in the complaint, although there may be instances in which a submission

by plaintiff will conclusively establish that he has no cause of action. It seems that after

the amendment of 1973 [adding CPLR 3211(c), and the opportunity to convert a motion

to dismiss into a summary judgment motion], affidavits submitted by the defendant will

seldom if ever warrant the relief he seeks unless too the affidavits establish conclusively

that plaintiff has no cause of action” [emphasis added]. The dissenters characterized the

majority as having “ruled that on a motion to dismiss for failure to state a cause of action

pursuant to CPLR 3211 (sub. (a), par. 7), the trial court may not dismiss as long as the

complaint and the plaintiff’s affidavit, if there be any, state all the elements of a cause of

action, and that a defendant’s affidavit, clearly showing the absence of one of these

essential elements, is of no avail. In essence, the majority has abrogated the statute and

has revitalized the common law demurrer.” The dissenters urged that “a motion to


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dismiss for failure to state a cause of action is no longer, as it once was, limited to the

face of the complaint (CPLR 3211, subd. [c]). The question now is whether the plaintiff

has a cause of action, not simply whether he has stated one. Thus, the court may consider

affidavits and other extrinsic proof to determine whether a fact essential to the plaintiff’s

cause of action is lacking.” But, “today, however, this court has held that these affidavits

‘are not to be examined for the purpose of determining whether there is evidentiary

support for the pleading.’ Hence, the defendant can no longer move to dismiss under this

section no matter how conclusively he can show that the plaintiff’s cause of action,

though properly pleaded, has no basis in fact.” The following year, in Guggenheimer v.

Ginzburg, 43 N Y 2d 268 (1977), the Court – now with both Rovello dissenters joining a

unanimous decision – stated the test somewhat differently: “Initially, the sole criterion is

whether the pleading states a cause of action, and if from its four corners factual

allegations are discerned which taken together manifest any cause of action cognizable at

law a motion for dismissal will fail [citations, which did not include Rovello, omitted].

When evidentiary material is considered, the criterion is whether the proponent of the

pleading has a cause of action, not whether he has stated one, and, unless it has been

shown that a material fact as claimed by the pleader to be one is not a fact at all and

unless it can be said that no significant dispute exists regarding it, again dismissal should

not eventuate [citations, which again did not include Rovello, omitted; emphasis added].”

Since then, there has been much confusion as to the proper use to which extrinsic

evidence may be put in an unconverted motion to dismiss. Then, some 30 years later, in

Nonnon v. City of New York, 9 N Y 3d 825 (2007), in the course of a brief Memorandum

Opinion, the Court stated that, “while affidavits may be considered, if the motion has not

been converted to a 3212 motion for summary judgment, they are generally intended to

remedy pleading defects and not to offer evidentiary support for properly pleaded claims

[citation omitted; emphasis added]. By contrast, a motion for summary judgment, which

seeks a determination that there are no material issues of fact for trial, assumes a

complete evidentiary record.” The Court cited Rovello for this proposition, but did not

cite Guggenheimer. Then, in Lawrence v. Graubard Miller, 11 N Y 3d 588 (2008), the

Court of Appeals, citing Rovello, but neither Guggenheimer nor Nonnon, held that,

“affidavits submitted by a respondent will almost never warrant dismissal under CPLR

3211 unless they ‘establish conclusively that petitioner has no claim or cause of action’”

[emphasis by the Court]. More recently, in Miglino v. Bally Total Fitness of Greater New

York, Inc., 20 N Y 3d 342 (2013), the Court of Appeals held that “Bally has moved to

dismiss under CPLR 3211(a)(7), which limits us to an examination of the pleadings to

determine whether they state a cause of action. Further, we must accept facts alleged as

true and interpret them in the light most favorable to plaintiff; and, as Supreme Court

observed, plaintiff may not be penalized for failure to make an evidentiary showing in

support of a complaint that states a claim on its face [citing Rovello]. Here, the complaint

asserts that Bally did not ‘employ or properly employ lifesaving measures regarding

Miglino’ after he collapsed. Bally’s motion is supported by affidavits that contradict this


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claim, by purporting to show that the minimal steps adequate to fulfill a health club’s

limited duty to a patron apparently suffering a coronary incident – i.e., calling 911,

administering CPR and/or relying on medical professionals who are voluntarily

furnishing emergency care – were, in fact, undertaken. But, as noted before, this matter

comes to us on a motion to dismiss, not a motion for summary judgment. As a result, the

case is not currently in a posture to be resolved as a matter of law on the basis of the

parties’ affidavits, and Miglino has at least pleaded a viable cause of action at common

law.” In Basis Yield Alpha Fund (Master) v. Goldman Sachs Group, Inc., 115 A D 3d

128 (1st Dept. 2014), also reported on in a prior year’s “Update,” the issue that divided

the Court was the impact of Miglino. The majority held that “the concurrence’s

contention that this Court is limited to the pleadings, when reviewing a motion to dismiss

pursuant to CPLR 3211(a)(7), is not a completely accurate statement of the law. What

the Court of Appeals has consistently said is that evidence in an affidavit used by a

defendant to attack the sufficiency of a pleading ‘will seldom if ever warrant the relief the

defendant seeks unless such evidence establishes conclusively that plaintiff has no cause

of action’ [citations omitted; emphasis by the Court]. A CPLR 3211(a)(7) motion may be

used by a defendant to test the facial sufficiency of a pleading in two different ways. On

the one hand, the motion may be used to dispose of an action in which the plaintiff has

not stated a claim cognizable at law. On the other hand, the motion may be used to

dispose of an action in which the plaintiff identified a cognizable cause of action but

failed to assert a material allegation necessary to support the cause of action. As to the

latter, the Court of Appeals has made clear that a defendant can submit evidence in

support of the motion attacking a well-pleaded cognizable claim [citations omitted].

When documentary evidence is submitted by a defendant ‘the standard morphs from

whether the plaintiff stated a cause of action to whether it has one’ [citations omitted].

As alleged here, if the defendant’s evidence establishes that the plaintiff has no cause of

action (i.e., that a well-pleaded cognizable claim is flatly rejected by the documentary

evidence), dismissal would be appropriate.” The concurring Justice argued that “CPLR

3211(a)(1) may be invoked where it is claimed that ‘documentary evidence utterly refutes

plaintiff’s factual allegations, conclusively establishing a defense as a matter of law’

[citation omitted]. On the other hand, as recently stated by the Court of Appeals, a

motion under CPLR 3211(a)(7) ‘limits us to an examination of the pleadings to determine

whether they state a cause of action’ [citing Miglino]. Therefore, contrary to what the

majority holds today, the disclaimers and disclosures in the offering circulars and other

documents [defendant] relies upon are of no moment for purposes of this CPLR

3211(a)(7) motion. As [plaintiff] aptly argued below, there was no basis for the motion

court to consider documents outside the complaint at this stage of the proceeding.” That

same year’s “Update” also reported on the Fourth Department’s decision in Liberty

Affordable Housing, Inc. v. Maple Court Apartments, 125 A D 3d 85 (4th Dept. 2015).

There, the Court held that, in Rovello, “the Court of Appeals held that summary dismissal

is appropriate under CPLR 3211(a)(7) when the defendant’s evidentiary submissions


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‘establish conclusively that plaintiff has no cause of action.’ We now consider whether

that holding remains viable in light of the Court’s recent decision in Miglino.” Agreeing

with the majority in the First Department decision in Basis Yield, the Court concluded

that Miglino does not bar “the consideration of any evidentiary submissions outside the

four corners of the complaint.” For, “given its unqualified citation to Rovello, Miglino is

properly understood as a straightforward application of Rovello’s longstanding

framework. Miglino was ‘not currently in a posture to be resolved as a matter of law on

the basis of the parties’ affidavits’ [citation omitted] because the evidentiary submissions

were insufficiently conclusive, not because they were categorically inadmissible in the

context of a CPLR 3211(a)(7) motion.” Last year’s “Update” reported on Clarke v.

Laidlaw Transit, Inc., 125 A D 3d 920 (2d Dept. 2015), in which the Second Department

also assessed the impact of Miglino. “The plaintiff ‘may not be penalized for failure to

make an evidentiary showing in support of a complaint that states a claim on its face’

[citations omitted]. The plaintiff may stand on his or her pleading alone to state all of the

necessary elements of a cognizable cause of action, and, unless the motion to dismiss is

converted by the court to a motion for summary judgment, the plaintiff will not be

penalized because he or she has not made an evidentiary showing in support of the

complaint [citation omitted]. In light of these standards, it is clear that the defendant’s

motion should have been denied. The complaint stated a cause of action, and the

defendant’s submissions did not ‘establish conclusively that the plaintiff has no cause of

action.’” Here, in Cash on the Spot, the Second Department held that, “where a court

considers evidentiary material in determining a motion to dismiss a complaint pursuant to

CPLR 3211(a)(7), but does not convert the motion into one for summary judgment, the

criterion becomes whether the plaintiff has a cause of action, not whether the plaintiff has

stated one, and unless the movant shows that a material fact as claimed by the plaintiff is

not a fact at all and no significant dispute exists regarding the alleged fact, the complaint

shall not be dismissed.”

Gawrych v. Astoria Federal Savings and Loan, 148 A D 3d 681 (2d Dept. 2017) – “On a

motion to dismiss for failure to state a cause of action pursuant to CPLR 3211(a)(7), ‘the

sole criterion is whether the pleading states a cause of action, and if from its four corners

factual allegations are discerned which taken together manifest any cause of action

cognizable at law, a motion for dismissal will fail’ [citations omitted]. ‘The complaint

must be construed liberally, the factual allegations deemed to be true, and the nonmoving

party granted the benefit of every possible favorable inference’ [citations omitted]. ‘A

court may freely consider affidavits submitted by the plaintiff to remedy any defects in

the complaint’ [citations omitted], and upon considering such an affidavit, the facts

alleged therein must also be assumed to be true [citation omitted]. Nevertheless, ‘bare

legal conclusions and factual claims which are flatly contradicted by the record are not

presumed to be true’ [citations omitted]. Moreover, where evidentiary material is

submitted and considered on a motion to dismiss a complaint pursuant to CPLR

3211(a)(7), the question becomes whether the plaintiff has a cause of action, not whether


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the plaintiff has stated one, and unless it has been shown that a material facts 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.”

Hartnagel v. FTW Contracting, 147 A D 3d 819 (2d Dept. 2017) – “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), such evidence may only be considered

to determine whether the plaintiff ‘has a cause of action, not whether he has stated one’

[citations, including to Guggenheimer, 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.’”

Deutsche Bank, National Trust Company v. Acevedo, N.Y.L.J., 1202752091954 (Sup.Ct.

Kings Co. 2016)(Garson, J.) – CPLR 3211(e) provides in pertinent part that when

defendant asserts lack of personal jurisdiction in the answer, based on failure to properly

serve process, that defense is waived unless defendant moves for judgment on that

ground within 60 days of serving the answer, absent a showing of “undue hardship.”

Here, “while defendant served an answer containing a defense of lack of personal

jurisdiction on August 24, 2014, more than sixty days prior to bringing the instant motion

to dismiss, the answer was rejected by plaintiff as untimely. The court notes that the

letter of rejection appears facially valid and defendant does not dispute otherwise.

Although plaintiff served a reply to defendant’s counterclaims three weeks following its

letter of rejection, there is nothing in the record indicating that plaintiff communicated to

defendant’s counsel that the answer was deemed accepted or that plaintiff would not take

proceedings toward a default judgment. Under the circumstances, plaintiff may not hold

defendant to the sixty-day limitation for seeking dismissal.”

Vandashield Ltd. v. Isaacson, 146 A D 3d 552 (1st Dept. 2017) – “Since plaintiffs

submitted no proposed amendment [to the complaint in its opposition to defendant’s

motion to dismiss], the court properly denied their request – made in a footnote in their

brief – to replead.”

TIMING OF MOTIONS FOR SUMMARY JUDGMENT

Reutzel v. Hunter Yes, Inc., 135 A D 3d 1123 (3d Dept. 2016) – In Brill v. City of New

York, 2 N Y 3d 648 (2004), the Court of Appeals held that the Legislature meant what it

said when it amended CPLR 3212(a) to provide a time limit for summary judgment

motions. That statute provides that, unless the Court sets a different date (which may not

be earlier than 30 days after Note of Issue is filed), the last date to make a dispositive

motion is 120 days after filing of the Note of Issue, unless the Court extends the time “for

good cause shown.” In Brill, the Court of Appeals held: “We conclude that ‘good cause’

in CPLR 3212(a) requires a showing of good cause for the delay in making the motion –

a satisfactory explanation for the untimeliness – rather than simply permitting


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meritorious, non-prejudicial filings, however tardy.” Berating the “sloppy practice

threatening the integrity of our judicial system,” the Court declined to permit a violation

of the statutory deadlines. Soon after, in Miceli v. State Farm Mutual Automobile

Insurance Company, 3 N Y 3d 725 (2004) the Court re-affirmed its holding. “As we

made clear in Brill, and underscore here, statutory time frames – like court-ordered time

frames [citation omitted] – are not options, they are requirements, to be taken seriously

by the parties.” A prior year’s “Update” reported on Kershaw v. Hospital for Special

Surgery, 114 A D 3d 75 (1st Dept. 2013), in which the narrowly-divided Appellate

Division disagreed about the application of the rule of Brill to a medical malpractice case

in which plaintiff had sued two different hospitals that treated him at different times,

claiming that both failed to advise and perform necessary surgery. One timely moved for

summary judgment; the other belatedly “cross-moved” for summary judgment. The

majority affirmed Supreme Court’s denial of the untimely “cross-motion,” rejecting the

argument that “there is an exception to Brill for cases where a late motion or cross motion

is essentially duplicative of a timely motion.” For, “the Court of Appeals intended no

such exception, and to the extent this Court has created one, it did so, whether knowingly

or unwittingly, by relying on precedents which predate Brill and which, if followed, will

continue to perpetuate a culture of delay.” Thus, “it is true that since Brill was decided,

this Court has held, on many occasions, that an untimely but correctly labeled cross

motion may be considered at least as to the issues that are the same in both it and the

motion, without needing to show good cause [citations omitted]. Some decisions also

reason that because CPLR 3212(b) gives the court the power to search the record and

grant summary judgment to any party without the necessity of a cross motion, the court

may address an untimely cross motion at least as to the causes of action or issues that are

the subject of the timely motion.” But in Kershaw, the “cross-motion,” in addition to

being untimely, “is not a true cross motion.” A cross-motion, made pursuant to CPLR

2215, is “‘a motion by any party against the party who made the original motion, made

returnable at the same time as the original motion.’” But this “cross-motion” was

directed at the complaint, as opposed to any cross claims, and was not made returnable

the same day as the original motion. So, “it was not a cross motion as defined in CPLR

2215.” And, “allowing movants to file untimely, mislabeled ‘cross motions’ without

good cause shown for the delay, affords them an unfair and improper advantage. Were

the motions properly labeled they would not be judicially considered without an

explanation for the delay.” Finally, “we are concerned that the respect for court orders

and statutory mandates and the authoritative voice of the Court of Appeals are

undermined each time an untimely motion is considered simply by labeling it a ‘cross

motion’ notwithstanding the absence of a reasonable explanation for its untimeliness.”

The Kershaw dissenters argued that the majority’s interpretation of Brill constitutes “an

unnecessarily rigid application of CPLR 3212(a), contravening the sound policy

considerations underlying the decision and the intent expressed by the Legislature in

amending the statute.” For, “the practice sought to be deterred in Brill is delay


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occasioned by the submission of a summary judgment motion on the eve of trial, thereby

staying proceedings to the prejudice of litigants who have applied their resources in

preparation for trial of the issues.” Here, however, “the proceedings were already stayed

by the concededly timely summary judgment motion” Thus, “the primary objective of

Brill to discourage dilatory conduct is not implicated.” The dissent agreed with the

majority that the “cross-motion” was mislabeled a cross-motion, and was untimely

pursuant to CPLR 2215. “But to reject the motion on that ground, under the facts herein,

ignores the adverse consequences of imposing an overly restrictive rule, specifically,

consequences that are especially adverse to the courts.” For, no prejudice was shown,

and “the majority thereby dispenses with the salutary aspects of summary disposition

acknowledged in Brill for no apparent purpose.” Indeed, “rote application of the

summary judgment provision, which permits the court to ‘set a date after which no such

motion may be made,’ leads to the result advocated by the majority – strict rejection of

the motion as untimely without taking into consideration the circumstances of the case,

relegating the moving party to litigating its position at trial. However, it is a well-

established rule of statutory construction that a court should avoid any interpretation that

leads to absurd and unintended consequences.” Accordingly, the dissent would hold that

“a late motion filing is properly entertained when it raises nearly identical issues to one

timely made.” And, here, both the motion and the “cross-motion” “seek dismissal of the

complaint on the identical ground – that it was not a departure from good and accepted

medical practice to forego surgery in favor of a conservative treatment plan.” By

contrast, that year’s “Update” also reported on Derrick v. North Star Orthopedics, PLLC,

121 A D 3d 741 (2d Dept. 2014), in which one defendant timely moved for summary

judgment, and another defendant untimely “cross-moved” for summary judgment. The

latter “was improperly designated a cross motion [citation omitted] and was, in fact, an

untimely motion for summary judgment [citation omitted]. However, ‘an untimely

motion or cross motion for summary judgment may be considered by the court where a

timely motion for summary judgment was made on nearly identical grounds.’” Last

year’s “Update” reported on Ezzard v. One East River Place Realty Company, LLC, 129

A D 3d 159 (1st Dept. 2015) in which, despite its earlier holding in Kershaw, the First

Department held that “although untimely, NYE&E’s motion should have been considered

insofar as it presents nearly identical issues and proof as those raised by the owner and

Solow in their joint summary judgment motion.” Here in Reutzel, the Third Department

enters the fray, and holds that, “‘a cross motion for summary judgment made after the

expiration of the deadline for making dispositive motions may be considered by the court,

even in the absence of good cause, where a timely motion for summary judgment was

made seeking relief nearly identical to that sought by the cross motion’ [citations

omitted]. Here, both [third-party defendant] Paraco’s timely motion for summary

judgment dismissing the third-party complaint and defendant’s untimely cross motion for

summary judgment on its contractual indemnification claim were premised upon

essentially the same grounds – namely, the applicability and enforceability of the


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indemnification clause at issue. Under these circumstances, Supreme Court properly

considered the merits of defendant’s cross motion.”

Rubino v. 330 Madison Company, LLC, 150 A D 3d 603 (1st Dept. 2017) – “The court

should have denied as untimely Waldorf’s cross motion for summary judgment

dismissing appellants’ contractual indemnification claim against it without considering

the merits, since the motion was filed after the applicable deadline and Waldorf failed to

show good cause for the delay [citation omitted]. Waldorf’s purported cross motion

against appellants, nonmoving parties, was not a true cross motion [citing Kershaw v.

Hospital for Special Surgery, discussed above], and did not merely raise issues ‘nearly

identical’ to those raised by plaintiffs and Mazzeo in their timely motions.”

Kritzer v. Ventura Insurance Brokerage, Inc., 50 Misc 3d 832 (Sup.Ct. N.Y.Co. 2015)

(Billings, J.) – CPLR 3212(a), “permitting the court to ‘set a date after which no such

motion may be made,’ applies only to motions for summary judgment. No authority

permits the court to abrogate CPLR 3211(e)’s provision that a motion pursuant to CPLR

3211(a)(7), failure to state a claim, ‘may be made at any time’ [citation omitted]. While

the parties themselves stipulated to a deadline for ‘dispositive motions,’ [citation

omitted], plaintiffs maintain only that that defendant’s motion pursuant to CPLR 3212(b)

is untimely under section 3212(a) and not that its motion pursuant to CPLR 3211(a)(7) is

untimely under section 3211(e). Nor do plaintiffs offer any support for simply assuming

that ‘dispositive motions’ includes a motion pursuant to CPLR 3211(a)(7). Absent any

evidentiary or legal support for such an interpretation, CPLR 3211(e)’s authorization that

a motion based on CPLR 3211(a)(7) ‘may be made at any time’ and CPLR 3212(a)’s

limitation to motions for summary judgment, ‘dispositive motions’ in this context must

be interpreted as encompassing only motions for summary judgment.”

Mills v. City of New York, 144 A D 3d 644 (2d Dept. 2016) – “Contrary to the

defendants’ contention, since the note of issue was vacated while the plaintiff’s motion

[for summary judgment] was pending, the motion was not untimely, and the Supreme

Court properly considered it.”

Cullity v. Posner, 143 A D 3d 513 (1st Dept. 2016) – The Appellate Division reverses the

granting of defendant’s motion for summary judgment. “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.”

Waxman v. The Hallen Construction Co., Inc., 139 A D 3d 597 (1st Dept. 2016) – “The

motion for summary judgment should have been denied as untimely, as it was submitted


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more than 50 days after the expiration of the deadline imposed by a preliminary

conference order, and there was no showing of good cause for the late filing [citations

omitted]. The reassignment of the action to a different Justice’s part after entry of the

preliminary conference order is not good cause for the late filing, since there was no

subsequent order or directive explicitly providing for a different time limit, or stating that

the time limits of the new part’s rules would supersede the preliminary conference order.”

Bennett v. St. John’s Home, 26 N Y 3d 1033 (2015) – Last year’s “Update” reported on

the Appellate Division decision in this action [128 A D 3d 1428 (4th Dept. 2015)]. The

majority of the divided Appellate Division held that “by expressly consenting to the

timing of the motion before it was made,” plaintiff waived his challenge to the otherwise

late summary judgment motion. “While we agree with our dissenting colleague that the

court was not required to accept the express stipulation of the parties to extend the 120-

day deadline in CPLR 3212, we note that the court in fact did so in advance of the motion

[citation omitted]. Moreover, unlike our dissenting colleague, we do not view the timing

requirements applicable to motions for summary judgment as a matter of public policy

that may not be affirmatively waived by a party.” The dissenter argued that ‘‘the parties’

stipulation is insufficient to excuse a delay’ [citation omitted]. ‘Unless public policy is

violated, the parties are free to chart their own procedural course, and may fashion the

basis upon which a particular controversy will be resolved’ [citations omitted]. However,

as articulated by the legislature and the Court of Appeals, it is public policy to strictly

enforce the 120-day limit for summary judgment motions in the absence of leave of court

on good cause shown.” For, “although parties may stipulate away some statutory rights

[citation omitted], under CPLR 3212(a) and the decisions of the Court of Appeals in Brill

[v. City of New York, 2 N Y 3d 648 (2004)] and Miceli [v. State Farm Mutual Automobile

Insurance Company, 3 N Y 3d 725 (2004)], ‘the court has the exclusive authority to

extend the statutory deadline; mutual agreement of the parties without court approval will

not suffice’ [citation omitted], and the court may not approve of the delayed motion

without a showing of good cause.” The statute “does not permit courts to accept a

stipulation of the parties ‘in advance of the motion’ where there is no showing of good

cause.” The Court of Appeals has affirmed because, not surprisingly, given the

stipulation at Supreme Court, “the issue of timeliness was not preserved in Supreme

Court.” Thus, “the Court of Appeals lacks power to review either the Appellate

Division’s exercise of its discretion to reach the issue, or the issue itself.”

Zarnoch v. Luckina, 148 A D 3d 1615 (4th Dept. 2017) – “We agree with plaintiff that

the court erred in denying his pretrial cross motion to dismiss the special employment

affirmative defense as untimely under CPLR 3212(a) [citation omitted]. To the extent

that the cross motion sought relief pursuant to CPLR 3211(b), it was not subject to the

time limit for summary judgment motions under CPLR 3212(a).”


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American Transit Insurance Company v. Baucage, 146 A D 3d 413 (1st Dept. 2017) –

“Since Innovative Medical never properly filed an answer, it may not ask the court to

reach the merits of the action because CPLR 3212(a) expressly provides that a motion for

summary judgment may only be made after joinder of issue.”

SUMMARY JUDGMENT

Kolel Damsek Eliezer, Inc. v. Schlesinger, 139 A D 3d 810 (2d Dept. 2016) – “Generally,

successive motions for summary judgment are not permitted [citation omitted]. A court

may, however, properly entertain such a motion ‘when it is substantively valid and the

granting of the motion will further the ends of justice and eliminate an unnecessary

burden on the resources of the courts.’”

Dolan v. Frigidaire, N.Y.L.J., 1202753683906 (Sup.Ct. Nassau Co. 2016)(Feinman, J.) –

“It is well settled that every motion for summary judgment shall be supported by an

affidavit and a copy of all the pleadings and other available proof such as depositions and

written admissions [citation omitted]. The pleadings are a requisite part of the record of a

CPLR 3212 motion and omission of same mandates the denial of summary judgment

relief.”

Ingvarsdottir v. Bedi, N.Y.L.J., 1202785146664 (Sup.Ct. N.Y.Co. 2017)(Edmead, J.) –

“Plaintiff’s motion for summary judgment pursuant to CPLR 3212 is not barred by her

previous motion brought pursuant to CPLR 3213. CPLR 3213 provides that ‘When an

action is based upon an instrument for the payment of money only or upon any judgment,

the plaintiff may serve with the summons a notice of motion for summary judgment and

the supporting papers in lieu of a complaint.’ Inasmuch as summary relief pursuant to

CPLR 3213 is limited to an ‘instrument for the payment of money only’ whereas

summary relief pursuant to CPLR 3212 requires a searching of an entire record after the

joinder of issue, it cannot be said that this Court’s previous denial of plaintiff’s motion

under CPLR 3213 precludes or bears on the merits of plaintiff’s instant motion under

CPLR 3212.”

Messina v. Lippman, 55 Misc 3d 1 (App.Term 2d Dept. 2016) – Ordinarily, a motion for

summary judgment stays discovery pursuant to CPLR 3214(b), although “a court may

direct otherwise,” if “there were any legitimate need for discovery” during the motion’s

pendency. The stay does not apply at all here, where “plaintiff were in default in failing

to respond to defendant’s interrogatories” before the summary judgment motion was

made, and, hence, “before any stay could arise.” Civil Court should have granted

defendant’s motion to compel compliance despite the pendency of the summary

judgment motion.

Imrie v. Imrie, 145 A D 3d 1358 (3d Dept. 2016) – “‘A summary judgment motion is

properly denied as premature when the nonmoving party has not been given reasonable


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time and opportunity to conduct disclosure relative to pertinent evidence that is within the

exclusive knowledge of the movant or a codefendant’ [citations omitted]. As is relevant

to plaintiff’s claim, a party seeking reformation of a contract must establish, by clear and

convincing evidence, either that the writing at issue was executed under mutual mistake

or that there was a fraudulently induced unilateral mistake [citations omitted]. The

importance of documents and depositions that plaintiff sought but had not been provided

is readily apparent. The premise of plaintiff’s cause of action is that, in executing the

relevant insurance policy, the corporation and Erie both intended to include plaintiff as a

loss payee but that, by mutual mistake, he was omitted. Erie had exclusive knowledge of

its understanding of the intended coverage and any intended loss payees at the time of the

execution of the relevant insurance policy. Moreover, it is likely to be in exclusive

possession of any collateral documents memorializing the intended scope of the relevant

insurance policy. Further, plaintiff’s contention that Erie has exclusive possession of

employees and materials that could shed light on its intent as to the insurance policy is

patently reasonable and not merely speculation [citation omitted]. Under the

circumstances, Erie’s motion for summary judgment should have been denied without

prejudice as premature.”

Martino v. Midtown Trackage Ventures, LLC, 147 A D 3d 1040 (2d Dept. 2017) – “A

party should be afforded a reasonable opportunity to conduct discovery prior to the

determination of a motion for summary judgment [citations omitted]. Here, the

defendant Tishman Construction Corporation (hereinafter Tishman) moved, inter alia,

for summary judgment dismissing the complaint insofar as asserted against it about five

months after the plaintiff commenced this action. Under the circumstances of this case,

at this stage of the proceedings, the Supreme Court should have denied that branch of

Tishman’s motion with leave to renew after the completion of discovery.”

KNET, Inc. v. Ruocco, 145 A D 3d 989 (2d Dept. 2016) – Plaintiffs moved for summary

judgment on their claim that shares issued to defendants should be invalidated, as

allegedly issued for little or no consideration. Over defendants’ objection, the Court

directed a hearing on the motion, despite defendants’ claim to entitlement to a jury trial,

and, after the hearing, granted the motion. The Appellate Division reverses. “CPLR

3212(c), which, on a motion for summary judgment, authorizes a trial of certain issues

not related to the merits or related to damages, was not applicable here [citation omitted].

Where, as here, a triable issue of fact (except as to damages) arises on a motion for

summary judgment, the motion must be denied pursuant to CPLR 3212(b).”

Canals v. Tilcon New York, Inc., 135 A D 3d 683 (2d Dept. 2016) – “‘Generally, it is for

the trier of fact to determine the issue of proximate cause’ [citations omitted]. ‘However,

the issue of proximate cause may be decided as a matter of law where only one

conclusion may be drawn from the established facts.’”


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Rodriguez v. City of New York, 142 A D 3d 778 (1st Dept. 2016) – “In this case, we are

revisiting a vexing issue regarding comparative fault: whether a plaintiff seeking

summary judgment on the issue of liability must establish, as a matter of law, that he or

she is free from comparative fault. This issue has spawned conflicting decisions between

the judicial departments, as well as inconsistent decisions by different panels within this

Department.” A narrowly-divided Court concludes that “the original approach adopted

by this Department, as well as that followed in the Second Department, which requires a

plaintiff to make a prima facie showing of freedom from comparative fault in order to

obtain summary judgment on the issue of liability, is the correct one.” The dissenters

argued that plaintiff’s comparative negligence, unless enough to exonerate defendant

entirely, is irrelevant on this motion. For, “the comparative negligence doctrine does not

bear upon whether a defendant is liable; rather, it bears upon the extent of the defendant’s

liability, where both the defendant and the plaintiff engaged in culpable conduct resulting

in the injury” [emphasis by the Court]. Thus, “where a defendant fails to raise issues of

fact as to his or her own negligence, but succeeds in raising issues of fact as to the

plaintiff’s comparative negligence, partial summary judgment on liability with respect to

defendant’s negligence is warranted, because the defendant will be liable to the extent his

or her misconduct proximately caused the injury” [emphasis by the Court].

Kanfer v. Wong, 145 A D 3d 985 (2d Dept. 2016) – “Since there can be more than one

proximate cause of an accident, a plaintiff moving for summary judgment on the issue of

liability has the burden of establishing, prima facie, not only that the defendant was

negligent, but that the plaintiff was free from comparative fault.”

Oluwatayo v. Dulinayan, 142 A D 3d 113 (1st Dept. 2016) – “The primary issue in this

appeal is whether plaintiff, as an innocent driver, who was rear-ended by one or more

cars, is by virtue of such status, per se, entitled to summary judgment on liability against

any or all defendant drivers. Under the circumstances here, we find that plaintiff, an

innocent driver, is not entitled to summary judgment on liability against any defendant

driver because, as the party moving for summary judgment, plaintiff failed to meet his

burden to eliminate triable issues of fact as to how the accident happened and which

defendant driver was responsible for the rear end collision. Such an innocent plaintiff

driver, however, is entitled to summary judgment on his lack of culpable conduct on the

issue of liability pursuant to CPLR 3212(g).”

Lindsay-Thompson v. Montefiore Medical Center, 147 A D 3d 638 (1st Dept. 2017) – In

a concurring opinion in Pullman v. Silverman, 28 N Y 3d 1060 (2016), Judge Fahey

noted that “First Department jurisprudence” – conflicting with that of the Second

Department – provides that “if a defendant in a medical malpractice action establishes

prima facie entitlement to summary judgment, by a showing either that he or she did not

depart from good and accepted medical practice or that any departure did not proximately

cause the plaintiff’s injuries, plaintiff is required to rebut defendant’s prima facie


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showing ‘with medical evidence that defendant departed from accepted medical practice

and that such departure was a proximate cause of the injuries alleged’” [emphasis by the

Court]. Here, in Lindsay-Thompson, the First Department, citing the seminal Second

Department case with approval, holds that “because defendants failed to establish the

absence of a departure from the standard of care, plaintiffs were not required to raise a

triable issue of act as to whether there was a departure.”

Abrams v. Related, L.P., 137 A D 3d 655 (1st Dept. 2016) – Back in 2008, the Appellate

Division, Second Department, held, in Construction by Singletree, Inc. v. Lowe, 55 A D

3d 861 (2d Dept. 2008), that when a party had failed to comply with a demand for expert

disclosure pursuant to CPLR 3101(d)(1)(i), that party could not submit an expert affidavit

in opposition to a motion for summary judgment. Singletree was a quite controversial

decision. After commentators had commentated at great length about it, and after both

lower Courts and the Second Department itself had applied it in all sorts of conflicting

ways, the Second Department undertook to “clarify” Singletree, by essentially overruling

it, in Rivers v. Birnbaum, 102 A D 3d 26 (2d Dept. 2012). The Court there ultimately

concluded that accepting or rejecting the expert affidavit was a matter for the trial court’s

sound discretion. And, after Rivers, the Second Department seems to have suggested that

the best use of that discretion was to accept the affidavit [Begley v. City of New York, 111

A D 3d 5 (2d Dept. 2013)]. But, just as the Second Department was moving away from

Singletree, the First Department appeared to be adopting it, although without citing

it [Scott v. Westmore Fuel Company, Inc., 96 A D 3d 520 (1st Dept. 2012); Garcia v. City

of New York, 98 A D 3d 857 (1st Dept. 2012)]. The issue has, at last, been settled.

Effective December 11, 2015, the Legislature amended CPLR 3212(b), adding the

following language to the statute: “Where 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 subparagraph (i) of paragraph (1) of

subdivision (d) of section 3101 was not furnished prior to the submission of the

affidavit.” The amendment applies to all summary judgment motions made in pending

actions on or after the effective date, and to all actions commenced on or after that date.

Here, in Abrams, and despite the amendment to CPLR 3212(b), the Court holds that,

“absent any excuse for noncompliance, [plaintiff’s] failure to identify his experts during

discovery, as required by defendants’ demand, warrants rejection of the experts’

affidavits” on defendant’s motion for summary judgment. The Court cited Garcia v. City

of New York, 98 A D 3d 857 (1st Dept. 2012), mentioned above, which the amendment

seemingly was intended to legislatively overrule.

Yampolskiy v. Baron, 150 A D 3d 795 (2d Dept. 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


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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.”

Nelson v. Rosenkranz, N.Y.L.J., 1202760097615 (Sup.Ct. N.Y.Co. 2016)(Lebovits, J.) –

“In any action other than matrimonial action, ‘summary judgment may be granted in

favor of any one or more parties, to the extent warranted, on such terms as may be just.’”

Here, the Court grants defendant’s motion for “reverse summary judgment.” Plaintiff

claimed that defendant breached their agreement by failing to pay in accordance with its

terms. She sought damages and rescission to avoid her own obligations under the

agreement. Defendant moved to “withdraw that part of his verified answer denying the

breach of contract,” and to grant plaintiff judgment for the sums claimed due. The Court

grants that motion, finding that, under the circumstances, rescission was an inappropriate

remedy.

CPLR 3213

1270 Morris LLC v. Caballero, N.Y.L.J., 1202779114370 (Civ.Ct. Bronx Co. 2017)

(Kraus, J.) – The summons served on a motion for summary judgment in lieu of

complaint must be more than “the standard form summons.” Instead, “the summons

served with such motion papers shall require the defendant to submit answering papers

on the motion within the time provided in the notice of motion.” It “should not be

phrased merely to require the defendant to serve answering papers ‘within’ a certain

period; it should specifically advise the defendant to serve ‘answering papers’ at least X

days prior to the return day set by the notice of motion. The defect in failing to comply

with the statute and failing to advise the Defendant as to the requirement and time for

serving answering papers is a fatal defect requiring dismissal of the action.”

TD Bank, N.A. v. Excelsior Syndication of N.Y. LLC, N.Y.L.J., 1202755395466 (Sup.Ct.

N.Y.Co. 2016)(Freed, J.) – “A movant’s service of a summons and motion pursuant to

CPLR 3213 requires a defendant to serve answering papers by the time set forth in the

notice of motion, and ‘the minimum amount of time the plaintiff must give the defendant

to appear and oppose the motion is dependent upon the date and method of service’

which is calculated pursuant to CPLR 320 [citation omitted]. Under CPLR 320(a), unless

service is made in person, a defendant must appear within 30 days after service is

complete. Pursuant to CPLR 3213, a plaintiff may schedule a motion hearing date

beyond the minimum time and then require that responding papers be served within that

extended period, not exceeding 10 days before the return date. However, because service

is not complete until ten days after proof of service is filed with the clerk of the court

(CPLR 308[2]), ‘the minimum amount of time between service of the summons and

motion papers and the return date is 40 days.’” When “as here, defendants have not been

provided with the statutorily required time in which to respond to a motion brought


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pursuant to CPLR 3213, a court lacks the jurisdiction to hear the motion and it must be

denied without prejudice and the action must be dismissed.”

The Park Union Condominium v. 910 Union Street, LLC, 140 A D 3d 673 (1st Dept.

2016) – “Plaintiffs, a condominium and its board of managers, established that the

parties’ settlement agreement, covering claims related to defendants’ construction of the

condominium, constituted ‘an instrument for the payment of money only’ [citation

omitted] and that defendant defaulted by failing to make payment under its terms

[citation omitted]. In opposition, defendant failed to raise a triable issue as to a defense

to the instrument [citation omitted]. The agreement contained an unconditional promise

by defendant to pay plaintiffs upon the execution of releases attached to the agreement,

and it required no additional performance by plaintiffs as a condition precedent to

payment or otherwise made defendant’s promise to pay something other than

unconditional.”

Blumenstein v. Waspit Group, Inc., 140 A D 3d 620 (1st Dept. 2016) – Defendant’s

argument that the note at issue is not an instrument for the payment of money only “is

defeated by their failure to establish that the note and the deed of settlement executed

simultaneously with it were inextricably intertwined [citations omitted]. While the note

states that it was executed ‘pursuant to’ and ‘in consideration of’ the deed, it does not

state that it was ‘subject to the terms and conditions of’ the deed [citation omitted].

Nothing in the deed affects the value of the principal due under the note or otherwise

alters defendants’ obligations to pay under the note.”

PDL Biopharma, Inc. v. Wohlstadter, 147 A D 3d 494 (1st Dept. 2017) – “‘The

prototypical example of an instrument within the ambit of CPLR 3213 is of course a

negotiable instrument for the payment of money – an unconditional promise to pay a sum

certain, signed by the maker and due on demand or at a definite time’ [citation omitted].

CPLR 3213 is generally used to enforce ‘some variety of commercial paper in which the

party to be charged has formally and explicitly acknowledged an indebtedness,’ so that ‘a

prima facie case would be made out by the instrument and a failure to make the payments

called for by its terms’ [citation omitted]. A document does not qualify for CPLR 3213

treatment if the court must consult other materials besides the bare document and proof

on nonpayment, or if it must make a more than de minimis deviation from the face of the

document.’” 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.’ The term ‘obligations’

is not defined in either of the guaranties.” Accordingly, the guarantee at issue is not

entitled to CPLR 3213 treatment.


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CPLR 3211(C) CONVERSION

Fedele v. Qualified Personal Residence Trust of Doris Rosen Margett, Dated November

14, 2001, 137 A D 3d 965 (2d Dept. 2016) – “The plaintiffs correctly contend that the

Supreme Court improperly converted that branch of the Hospital’s motion which was to

dismiss the amended complaint into a motion for summary judgment without adequately

notifying the parties pursuant to CPLR 3211(c). The plaintiffs ‘were not put on notice of

their obligation to make a complete record and to come forward with any evidence that

could possibly be considered,’ or given an opportunity to do so [citation omitted]. The

record does not establish that the plaintiffs were laying bare their proof [citations

omitted] or that either party deliberately charted a summary judgment course [citations

omitted]. Yet, the Supreme Court ‘effectively treated the motion as one for summary

judgment, which requires disclosure of all of the evidence on the disputed issues.’”

Smithers v. County of Oneida, 138 A D 3d 1504 (4th Dept. 2016) – “We reject plaintiff’s

contention that the court was required to give the parties notice that it was treating the

motion as one for summary judgment. ‘A court may treat a motion to dismiss as a

motion for summary judgment when the parties have otherwise received adequate notice

by expressly seeking summary judgment or submitting facts and arguments clearly

indicating that they were deliberately charting a summary judgment course’ [citations

omitted]. Here, plaintiff was on notice that defendant was seeking summary judgment in

the alternative and, indeed, opposed that part of the motion.”

DEFAULTS

OBTAINING A DEFAULT JUDGMENT

Cukierwar v. College Central Network, Inc., 148 A D 3d 983 (2d Dept. 2017) – “‘A

default judgment may not award relief of a different kind than that demanded in the

complaint’ [citation omitted]. Moreover, ‘at an inquest, the court may not permit

amendments of the pleadings which would broaden the scope of the inquest and increase

the amount of damages provable by the plaintiff.’”

Roy v. 81 E. 98th KH Gym, LLC, 142 A D 3d 985 (2d Dept. 2016) – “On a motion for

leave to enter a default judgment pursuant to CPLR 3215, a plaintiff is required to submit

proof of service of the summons and complaint, proof of the facts constituting the cause

of action, and proof of the defendant’s default in answering or appearing [citations

omitted]. A plaintiff must allege enough facts to enable the court to determine that a

viable cause of action exists [citations omitted]. Here, in the plaintiff’s affidavit

submitted in support of his motion, he stated merely that he suffered electrical burns

while working as an intern for a third-party defendant, the New York City Department of

Education. The plaintiff failed to allege enough facts in his affidavit to enable the court

to determine that a viable cause of action exists against” defendants. Moreover,


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plaintiff’s “amended complaint was verified only by his attorney, and not by a party with

personal knowledge of the facts. Therefore, the amended complaint, by itself, was

insufficient to enable the court to determine that a viable cause of action exists” against

defendants.

Clarke v. Liberty Mutual Fire Insurance Co., 150 A D 3d 1192 (2d Dept. 2017) –

“Plaintiffs met all of the requirements for demonstrating their entitlement to enter a

default judgment against the defendant. The affidavit of service submitted in support of

the motion constituted prima facie evidence that the defendant was properly served

through the New York State Department of Financial Services pursuant to Insurance Law

§1212 [citations omitted]. Further, since the plaintiffs’ attorney had firsthand knowledge

of the facts constituting the plaintiffs’ cause of action pursuant to Insurance Law

§3420(a)(2) against the defendant [to recover the amount of an unsatisfied judgment in a

personal injury action against defendant’s insured] and proof of the defendant’s default in

answering the complaint, the Supreme Court improperly denied the plaintiffs’ motion on

the basis that their attorney’s affirmation and the complaint verified by him did not

provide a sufficient basis upon which to grant leave to enter a default judgment against

the defendant.”

Gantt v. North Shore-LIJ Health System, 140 A D 3d 418 (1st Dept. 2016) – “Any

irregularity in the affidavit of nonmilitary service submitted on plaintiff’s motion for a

default judgment did not rise to the level of a jurisdictional defect, since defendant

Hilario never made any pretense of either being on active military duty or being a

military dependent at the time of her default.”

Avis Rent a Car System, LLC v. Forbes, N.Y.L.J., 1202777935240 (Civ.Ct. Bronx Co.

2017)(Kraus, J.) – This case presents a textbook catalogue of errors in an application for

a default judgment. First, “although the moving papers assert a copy of the affidavit of

service for the summons and complaint are annexed as Exhibit ‘A’ in fact no such proof

of service is annexed to the moving papers. Only the affidavit confirming the additional

mailing as required by CPLR 3215(g)(3) is attached. Even that mailing appears

insufficient, as Plaintiff appears to have information about a different address for the

same defendant.” Second, “no legible copy of the contract sued upon was annexed to the

moving papers. A partial copy without signatures in tiny blurred print is attached as part

of Exhibit ‘B’ but is not legible.” Third, “the non-military information is stale as it is

dated from January 2015, approximately two years prior to the motion, and prior to the

commencement of this action.” And, “to the extent that movant relies upon the printout

from the Department of Defense, the affidavit must specifically state what information

was entered for this specific search. Instead the two year old affidavit states ambiguously

that ‘pertinent information’ was provided ‘such as date of birth and/or social security

number.” Finally, “and most disturbing of all, this is apparently the second law suit that

Plaintiff has commenced against Defendant for the same cause of action,” which fact


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plaintiff did not disclose in its papers. And, in the earlier lawsuit, which was dismissed

for failure to properly serve defendant, plaintiff alleged an entirely different address for

plaintiff than the one it claims now, with no explanation. Not surprisingly, the Court

denies the motion for a default judgment.

American Transit Insurance Company v. Baucage, 146 A D 3d 413 (1st Dept. 2017) –

“Innovative Medical’s claim that plaintiff accepted its untimely answer by failing to

reject it fails, because plaintiff moved for the default judgment within 13 days of its

receipt.”

Kim v. S&M Caterers, Inc., 136 A D 3d 755 (2d Dept. 2016) – “By defaulting, the

defendant admitted ‘all traversable allegations in the complaint, including the basic

allegation of liability’ [citations omitted]. As such, the sole issue to be determined at the

inquest was the extent of the damages sustained by the plaintiffs, and the Supreme Court

erred in considering the questions of whether the defendant owed the plaintiffs a duty of

care or whether the subject accident was caused by the defendant’s conduct.”

At Last Sportswear, Inc. v. North American Textile Co., LLC, N.Y.L.J., 1202765280751

(Sup.Ct. N.Y.Co. 2016)(Bransten, J.) – “When a defendant defaults on the action, it is

deemed to have ‘admitted all traversable allegations in the complaint, including the basic

allegation of liability, but does not admit the plaintiff’s conclusion of damages’ [citations

omitted]. Here, since Plaintiff has not attached evidence substantiating the amount of

damages that it alleges against Defendant Fortunex, a damages inquest is thus necessary

to calculate the amount of damages that Defendant Fortunex owes Plaintiff.”

NYCTL 2014-A Trust v. 774 Properties LLC, 54 Misc 3d 645 (Sup.Ct. Kings Co.

2016)(Rivera, J.) – “CPLR 3215(g) sets forth when and under what circumstances notice

of an application or motion for leave to enter a default judgment must be given. It

provides that any defendant who has appeared in an action but subsequently defaults ‘is

entitled to at least five days’ notice of the time and place’ of the motion for leave to enter

a default judgment. It further provides, as relevant to the instant motion, that if more than

one year has elapsed since the default any defendant who has not appeared is entitled to

the same notice unless the court orders otherwise. The failure of the plaintiff to give

notice to the defendants of its motion for leave to enter a default judgment pursuant to

CPLR 3215(g)(1) deprives the Supreme court of jurisdiction to entertain the motion.”

Bank of New York v. Kushnir, 150 A D 3d 946 (2d Dept. 2017) – “CPLR 3215(c)

provides, with regard to default judgments, in pertinent part, that ‘if the plaintiff fails to

take proceedings for the entry of judgment within one year after the default, the court

shall not enter judgment but shall dismiss the complaint as abandoned, without costs,

upon its own initiative or on motion, unless sufficient cause is shown why the complaint

should not be dismissed.’ ‘The language of CPLR 3215(c) is not, in the first instance,


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discretionary, but mandatory, inasmuch as courts “shall” dismiss claims [citation omitted]

for which default judgments are not sought within the requisite one-year period, as those

claims are then deemed abandoned’ [citations omitted]. ‘The one exception to the

otherwise mandatory language of CPLR 3215(c) is that the failure to timely seek a

default on an unanswered complaint or counterclaim may be excused if “sufficient cause

is shown why the complaint should not be dismissed”’ [citations omitted]. ‘This Court

has interpreted this language as requiring both a reasonable excuse for the delay in timely

moving for a default judgment, plus a demonstration that the cause of action is potentially

meritorious.’”

US Bank National Association v. Brown, 147 A D 3d 428 (1st Dept. 2017) – CPLR

3215(c) provides that unless plaintiff takes “proceedings for the entry of judgment within

one year after the [defendant’s] default,” no default judgment will be entered, and,

instead, the action will be dismissed. Here, the Court finds that plaintiff took sufficient

“proceedings” within the year. “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.’” This “timely application ‘even

if unsuccessful’ will not result in the dismissal of the complaint ‘as abandoned pursuant

to CPLR 3215(c).’”

US Bank National Association v. Konstantinovic, 147 A D 3d 1002 (2d Dept. 2017) – “It

is enough that the plaintiff timely takes ‘the preliminary step toward obtaining a default

judgment of foreclosure and sale by moving for an order of reference’ to establish that it

‘initiated proceedings for entry of a judgment within one year of the default’ for purposes

of satisfying CPLR 3215(c).”

VACATING A DEFAULT

Hutchinson Burger, Inc. v. Bradshaw, 149 A D 3d 545 (1st Dept. 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).”

Henderson-Jones v. City of New York, 55 Misc 3d 401 (Sup.Ct. N.Y.Co. 2016)(Billings,

J.) – Because the individual defendant appeared and opposed the motion for leave to

enter a default judgment against him, “CPLR 5015(a)(1) is unavailable to him as a basis

for vacating the judgment. Van Orden needed to avail himself of CPLR 5015(a)(2), (3),

(4) or (5) or to appeal the judgment.”

Snyder v. Singh, 146 A D 3d 1141 (3d Dept. 2017) – After being served with the

summons and complaint in this dental malpractice action, defendant’s office called


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plaintiff’s counsel, saying that it had been ten years since defendant treated plaintiff (that

was incorrect; defendant had two patients with the same name, and was referring to the

wrong file), and defendant thereafter took no steps to respond to the complaint until

served with a copy of the motion for a default judgment. The Court concludes that

Supreme Court did not abuse its discretion in denying defendant’s cross-motion seeking

to compel acceptance of a late answer. “A defendant’s mistaken belief that it has no

liability ‘does not constitute a reasonable excuse for its default.’”

John v. Arin Bainbridge Realty Corp., 147 A D 3d 454 (1st Dept. 2017) – “‘To obtain

relief from a default judgment under CPLR 5015(a)(1), a party is required to demonstrate

both a reasonable excuse for the default and a meritorious claim or defense to the action’

[citations omitted]. However, ‘the failure of a corporate defendant to receive service of

process due to breach of the obligation to keep a current address on file with the

Secretary of State [citation omitted] does not constitute a reasonable excuse’ [citation

omitted]. Thus, the court properly denied Arin’s motion to vacate the default judgment

under CPLR 5015(a)(1). CPLR 317 provides that ‘a person served with a summons other

than by personal delivery to him or to his agent for service under CPLR 318 who does

not appear may be allowed to defend the action within one year after he obtains

knowledge of entry of the judgment upon a finding of the court that he did not personally

receive notice of the summons in time to defend and has a meritorious defense.’ No

showing of a reasonable excuse is necessary [citation omitted]. Service upon a

corporation through the Secretary of State, pursuant to Business Corporation Law §306,

is not ‘personal service’ [citation omitted]. 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.”

Top Notch Drywall Corp. v. All Mine of Orange, Inc., 55 Misc 3d 25 (App.Term 2d Dept.

2017) – “While there is no per se rule under CPLR 5015 which precludes a corporation

from establishing, as its reasonable excuse for defaulting in an action, its failure to keep

current its address on file with the Secretary of State [citation omitted], courts should

consider, as one factor in determining whether such an excuse is reasonable, ‘the length

of time for which the address had not been kept current’ [citation omitted]. Since

defendant failed to update its address on file with the Secretary of State for over 12 years,

we find that defendant has not demonstrated a reasonable excuse for its default [citations

omitted]. While relief from a default judgment may be obtained pursuant to CPLR 317

where service was made in a manner other than be personal delivery and the defaulting

party did not receive actual notice of the summons in time to defend [citations omitted],

here, the fact that the incorrect address remained on file with the Secretary of State for

over 12 years, without any explanation by defendant as to why it had not provided the

Secretary of State with its changed address, should be deemed ‘a deliberate attempt to


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avoid notice’ [citation omitted]. Consequently, defendant’s motion to vacate the default

judgment was properly denied.”

Marston v. Cole, 147 A D 3d 678 (1st Dept. 2017) – The majority here notes that “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.” Two Justices

separately concurred, agreeing that Supreme Court properly denied the motion to vacate

the default because the motion was untimely, without a reasonable excuse. The

concurring Justices concluded that, in light of that conclusion, there was no need to

determine if plaintiff had made an adequate showing on the merits.

Gourvitch v. 92nd and 3rd Rest Corp., 146 A D 3d 431 (1st Dept. 2017) – “Plaintiff’s

noncompliance with the ‘additional service’ requirement of CPLR 3215(g)(4)(i) does not

warrant vacatur of the default judgment absent a showing of a reasonable excuse for the

default and a meritorious defense [citations omitted]. The motion court properly denied

vacatur on the ground that 92nd and 3rd Rest Corp.’s conclusory denial of receipt of the

summons and complaint was insufficient to rebut the presumption of service created by

the affidavit of service reflecting service through the Secretary of State.”

Matter of Limitone Enterprises, Inc. v. Walker, 139 A D 3d 951 (2d Dept. 2016) – “The

petitioners commenced this proceeding pursuant to CPLR article 78, inter alia, to compel

the respondent to rescind and annul the sale of certain real property sold pursuant to a

judgment of foreclosure and sale dated September 20, 2010, and entered, upon default, in

a related in rem tax lien foreclosure proceeding.” However, “the procedure for relief

from a default judgment generally is described in CPLR 317 and 5015(a), and,

specifically with regard to in rem tax lien foreclosure proceedings pursuant to article 11

of the Real Property Tax Law, in RPTL 1131. All of these provisions require the making

of a motion for relief in the original action.” This is, therefore, an attempt to “improperly

collaterally attack the default judgment by way of this proceeding pursuant to CPLR

article 78,” and the denial of relief is affirmed.

Deutsche Bank National Trust Company v. Karlis, 138 A D 3d 915 (2d Dept. 2016) –

Defendant here seeks to vacate his default pursuant to CPLR 5015(a)(4), contending that

the Court lacks jurisdiction over him because process was served upon him at a time

when his co-defendant was protected by the automatic stay provided for in the

Bankruptcy Law. The Court rejects that argument. “The automatic stay provided for in


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11 USC §362(a)(1) only acts to stay, among other things, ‘the commencement or

continuation, including the issuance or employment of process, of a judicial,

administrative, or other action or proceeding against the debtor’ in the bankruptcy

proceeding [citations omitted; emphasis by the Court]. ‘In general, only a debtor is

included within the protective umbrella afforded by the automatic stay that arises

pursuant to §362(a)(1). Third-party defendants or co-defendants are typically not

provided such protection.’”

Darbeau v. 136 West 3rd Street, LLC, 144 A D 3d 420 (1st Dept. 2016) – “Service upon

the LLC was complete upon service to the Secretary of State [citation omitted].

Moreover, because the LLC’s motion papers indicate that it chose to seek vacatur

pursuant to CPLR 317 and 5015(1), which presume jurisdiction, and not CPLR

5015(a)(4), it is precluded from arguing that any deficiency in service constituted a lack

of jurisdiction.”

Federal National Mortgage Association v. Zapata, 143 A D 3d 857 (2d Dept. 2016) –

“‘To extend the time to answer the complaint and to compel the plaintiff to accept an

untimely answer as timely, a defendant must provide a reasonable excuse for the delay

and demonstrate a potentially meritorious defense to the action’ [citation omitted]. ‘The

determination of what constitutes a reasonable excuse lies within the sound discretion of

the Supreme Court’ [citations omitted]. Here, Zapata’s participation in settlement

conferences and loan modification negotiations did not constitute a reasonable excuse for

his default [citations omitted]. Inasmuch as Zapata failed to demonstrate a reasonable

excuse for the default, we need not consider whether he offered a potentially meritorious

defense to the action.”

Ashley v. Ashley, 139 A D 3d 650 (2d Dept. 2016) – “A motion to vacate a judgment

pursuant to CPLR 5015(a)(1) on the ground of excusable default must be made within

one year after service upon the moving party of a copy of the judgment, with notice of its

entry [citation omitted]. Although the Supreme Court has the inherent authority to vacate

a judgment in the interest of justice even after the statutory one-year period has lapsed

[citations omitted], here, the Supreme Court providently exercised its discretion in

denying that branch of the defendant’s motion which was to vacate the judgment. The

defendant failed to present any excuse for her failure to move to vacate the judgment for

more than two years after its entry, and failed to present any potentially meritorious

defenses.”

Gage v. Village of Catskill, 144 A D 3d 1365 (3d Dept. 2016) – “In support of its motion

[to vacate its default], defendant submitted the affidavit of the Village Clerk who

acknowledged that she was served with a copy of the summons and complaint on August

20, 2013. She asserted that the summons and complaint were promptly forwarded to

defendant’s insurance agent, and defendant provided documentary evidence


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corroborating her assertion. She stated that, based on a November 2012 letter from

counsel assigned by SIC [the insurer] to represent defendant in connection with the notice

of claim and a March 2013 letter from an SIC representative regarding its counsel’s

response to plaintiff’s application to file a late notice of claim, she believed that

defendant’s legal interests were being represented by SIC’s counsel at the time that the

action was commenced. She further stated that, although she also received plaintiff’s

motion for a default judgment, she did not review its contents because, among other

things, she assumed that the motion was being handled by counsel. Defendant also

submitted the affirmation of its attorney, who averred that SIC had no record of the

summons and complaint having been received. 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.”

Kim v. Strippoli, 144 A D 3d 982 (2d Dept. 2016) – “The record supports the Supreme

Court’s determination that the defendants had a reasonable excuse for their failure to

serve a timely answer. The defendants, who had promptly notified their insurer of the

occurrence of the accident, of the service of the summons and complaint, and of the

service of the plaintiff’s motion for leave to enter a default judgment, reasonably relied

on their insurer to interpose an answer. Within two weeks after the subject accident, the

defendants’ insurer notified the plaintiffs of the defendants’ coverage and that the

insurer’s investigation of the accident led it to believe that the defendants were not liable

to the plaintiffs. In opposition to plaintiff’s motion [for a default judgment] and in

support of their own cross motion [for an extension of time to serve and file a late

answer], the defendants submitted evidence from their insurer demonstrating that the

insurer had always intended to fully defend the claim on the defendants’ behalf, but, due

to an administrative error, the summons and complaint were not assigned to an attorney,

notwithstanding that the defendants had promptly reported the suit to the insurer. Upon

receipt of the plaintiffs’ motion, the insurer promptly assigned an attorney, who engaged

in the instant motion practice. Under these circumstances, the Supreme court properly

found that the defendants had a reasonable excuse for their default.”

CPLR 3216

U.S. Bank National Association v. Bassett, 137 A D 3d 1109 (2d Dept. 2016) – “The

Supreme Court was without power to dismiss the action on the ground of a general lack


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of prosecution since a precondition set forth in CPLR 3216 – that issue must have been

joined – was not met [citations omitted]. The defendants had not served answers in the

action so issue had never been joined.”

The Board of Managers of the Lore Condominium v. Gaetano, 139 A D 3d 550 (1st Dept.

2016) – “The motion court erred when it effectively dismissed the complaint pursuant to

CPLR 3216(a) on the basis that plaintiff failed to file a note of issue and certificate of

readiness by October 18, 2013, as required by both a preliminary conference order and a

so-ordered stipulation entered into by the parties. A condition precedent to dismissal

pursuant to CPLR 3216(a) was not satisfied, since a written demand pursuant to CPLR

3216(b)(3) was never served upon plaintiff. Although court orders signed by the parties

may constitute a written demand under CPLR 3216(b)(3) [citation omitted], the

preliminary conference order does not qualify as such because it was unsigned by the

parties [citation omitted] and it did not give plaintiff the required 90 days to serve and file

the note of issue, or state that plaintiff’s failure to timely do so would serve as a basis for

a motion to dismiss [citations omitted]. The stipulation, while signed by both parties,

also fails to qualify as a written demand, because it does not contain the requisite

statutory language.”

Deutsche Bank National Trust Company v. Cotton, 147 A D 3d 1020 (2d Dept. 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.” 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”’ [citations 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 [citation omitted]. The Supreme Court thereafter erred in administratively

dismissing the action without further notice to the parties.”

US Bank National Association v. Saraceno, 147 A D 3d 1005 (2d Dept. 2017) – “The

order dated March 28, 2013, failed to constitute a valid 90-day demand under [CPLR

3216], 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


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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.”

Kamensky v. Savage, 55 Misc 3d 20 (App.Term 2d Dept. 2017) – District Court issued a

“Notice of CPLR 3216 Dismissal,” which provided: “Please be advised that more than

one year has elapsed since the joinder of issue in the above entitled action. Pursuant to

CPLR 3216, you are required to serve and file a notice of trial within ninety days of

receipt of this demand. Failure to timely comply with this demand will result in the

dismissal of the action by the Court.” Nine months later, no notice of trial having been

served or filed, the action was dismissed by the Clerk’s Office. The Appellate Term

reverses the denial of the motion to vacate the dismissal and restore the action to the

calendar. “District Court’s 90-day demand was not followed by any notice to the parties

or a formal order of dismissal.” And defendants’ motion to dismiss the action for failure

to comply with the 90-day demand should also be denied. “A condition precedent to

making a motion to dismiss on this basis is the service of a 90-day demand ‘by the party’

who ‘served said demand for dismissal.’” Since defendants did not serve the demand,

“they have failed to satisfy the precondition and, therefore, are not entitled to the

dismissal of the complaint.”

Suliman v. Rite-Aid Corporation, N.Y.L.J., 1202763654276 (Sup.Ct. Kings Co. 2016)

(Rivera, J.) – “CPLR 3216(a)(3) requires, amongst other things, that the notice be sent by

registered or certified mail. ‘It has been held that Federal Express – presumably,

therefore, any overnight service – may be used instead of the usual U.S. mails. Taking

this kind of liberty, however, in the face of a specific statutory instruction for registered

or certified mail is not wise, and should in no circumstances be tried when the statute

involved is prescribing service of process’ [citation omitted]. However, in situations

where the plaintiff has admitted to receipt of the 90-day notice, the failure to serve a

CPLR 3216 demand by registered or certified mail is a procedural irregularity and, absent

a showing of prejudice to a substantial right of plaintiff, courts should not deny, as

jurisdictionally defective, a defendant’s motion to dismiss for neglect to prosecute.”

Here, the demand was served by ordinary – rather than certified or registered – mail, and

plaintiff has defaulted on the motion to dismiss. Accordingly, “there is no reliable basis

for the Court to find that Rite Aid properly served Suliman with a demand in accordance

with the requirements of CPLR 3216(b). Accordingly, although there is no opposition to

the motion it is, nevertheless, denied without prejudice.”

Walker v. Gibbons, 137 A D 3d 483 (1st Dept. 2016) – “In this action for personal

injuries, we are satisfied that plaintiff’s failure to file a note of issue within 90 days of

defendant Arthur Gibbons’s CPLR 3216 demand was largely attributable to defendant’s

refusal to comply with the notices to take the outstanding deposition of its employee and

for an inspection of its premises [citation omitted]. Accordingly, defendant Arthur


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Gibbons’s motion to dismiss should have been denied. Also, defendants Back to

Jerusalem Pentecostal Mission and Lurena Felder Sutton’s cross motion for dismissal of

the complaint for failure to prosecute should have been denied for the additional reason

that they did not serve their own 90-day notice.”

JUDGMENT BY CONFESSION

Cash and Carry Filing Service, LLC v. Perveez, 149 A D 3d 578 (1st Dept. 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.”

Merchant Funding Services, LLC v. Volunteer Pharmacy, Inc., 55 Misc 3d 316 (Sup.Ct.

Westchester Co. 2016)(Everett, J.) – The Court here permits defendant to challenge a

judgment by confession by motion rather than requiring a separate plenary action.

“While cases dating back at least 65 years have held that a motion by ‘a judgment debtor

who seeks to set aside a judgment entered by confession, on grounds of fraud or

misconduct, must proceed by plenary action, not by motion,’ those cases ‘have so held,

on the grounds that sharply contested issues of fact should not be resolved upon

affidavits, but rather by trial in a plenary action’ [citation omitted]. In the instant case,

however, the submitted affidavits and exhibits clearly and unequivocally demonstrate that

the agreement is criminally usurious on its face, obviating the need for a superfluous

plenary action.” In particular, “by recognizing the lack of necessity for a plenary action

in cases where criminal usury is clear from the submissions attendant to a motion under

CPLR 5015(a)(3), the victims of predatory lending though such illegal loan agreements

are spared the needless cost in time and money or pursuing a plenary action, the outcome

of which would be the same.”

OFFER TO COMPROMISE OR LIQUIDATE DAMAGES

Saul v. Cahan, N.Y.L.J., 1202752649737 (Sup.Ct. Kings Co. 2016)(Demarest, J.) –

CPLR 3220 provides that “not later” than 10 days before trial, a defendant may serve

upon plaintiff an offer to allow judgment to be taken for a specified sum, if defendant

loses at trial. If the offer is accepted within 10 days, and plaintiff wins at trial, damages

will be awarded in accordance with the offer. The statute then provides that “if the offer

is not so accepted and the claimant fails to obtain a more favorable judgment, he shall

pay the expenses necessarily incurred by the party against whom the claim is asserted, for

trying the issue of damages from the time of the offer. The expenses shall be ascertained

by the judge or referee before whom the case is tried.” The issue here is whether a

defendant, whose offer was not accepted, is entitled to damages if the case was not tried.

“‘Although the plain language of the statute appears to contemplate at least the

commencement of a trial before a party could recover attorney’s fees pursuant to CPLR


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3220’ [citation omitted], the Third Department granted attorney’s fees pursuant to CPLR

3220 where a defendant obtained summary judgment dismissing a case after the joinder

of issue [citation omitted]. Accordingly, the doctrine of stare decisis requires this court

to follow the precedent of the Third Department Appellate Division until the Court of

Appeals or the Second Department Appellate Division pronounces a contrary rule.”

VOLUNTARY DISCONTINUANCE

A.K. v. T.K., 150 A D 3d 1091 (2d Dept. 2017) – “Under CPLR 3217(a), a party may

voluntarily discontinue an action without a court order by ‘serving upon all parties to the

action a notice of discontinuance at any time before a responsive pleading is served or, if

no responsive pleading is required, within twenty days after service of the pleading

asserting the claim’ [citation omitted]. ‘Where no pleadings have been served the

plaintiff has the “absolute and unconditional right” to discontinue the action by serving a

notice of discontinuance upon the defendant without seeking judicial permission’

[citations omitted]. 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.”

Marinelli v. Wimmer, 139 A D 3d 914 (2d Dept. 2016) – “A motion for leave to

discontinue an action is addressed to the sound discretion of the court [citations omitted],

and generally should be granted unless the discontinuance would prejudice a substantial

right of another party, circumvent an order of the court, avoid the consequences of a

potentially adverse determination, or produce other improper results.” Here, “the record

supports the conclusion that the requested discontinuance was improperly sought to avoid

the consequences of a potentially adverse determination with respect to the defendants’

motion to change venue [citations omitted], as well as to prejudice the defendants’ ability

to obtain venue in a proper county.”

US Bank National Association v. Cockfield, 143 A D 3d 889 (2d Dept. 2016) – “As

pertinent to this appeal, CPLR 3217(c) provides that, unless otherwise stated in the

notice, stipulation, or order, a voluntary discontinuance is ‘without prejudice, except that

a discontinuance by means of notice operates as an adjudication on the merits if the party

has once before discontinued by any method an action based on the same cause of action’

[citation omitted]. 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]. Instead, the Supreme Court should have exercised its discretion in

determining whether to issue an order of discontinuance, upon whatever ‘terms and

conditions the court deems proper.’”


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BILL OF PARTICULARS

Paterra v. Arc Development LLC, 136 A D 3d 474 (1st Dept. 2016) – “Defendants were

entitled to dismissal of all of plaintiff’s Labor Law claims, since plaintiff asserted the

Labor Law claims for the first time in his bill of particulars, and failed to allege them in

his complaint [citations omitted]. The purpose of the bill of particulars is to amplify the

pleadings [citation omitted], and ‘may not be used to supply allegations essential to a

cause of action that was not pleaded in the complaint’ [citation omitted]. Nor may the

bill of particulars ‘add or substitute a new theory or cause of action.’”

DISCLOSURE

MOTION PRACTICE

Jackson v. Hunter Roberts Construction Group, L.L.C., 139 A D 3d 429 (1st Dept. 2016)

– “The motion court improvidently exercised its discretion in striking the answer.

Plaintiffs’ motion was procedurally deficient, since it was not supported by an

affirmation of good faith [citation omitted]. Nor did the record show that ‘any further

attempt to resolve the dispute nonjudicially would have been futile’ [citation omitted].

Plaintiffs failed to identify any recent meaningful attempts to resolve the parties’

discovery disputes before raising them for the first time in their motion.”

Robins v. Procure Treatment Centers, Inc., N.Y.L.J., 1202785146388 (Sup.Ct. N.Y.Co.

2017)(Silver, J.) – “A party moving to compel discovery is required to submit an

affirmation that counsel for the moving party has made ‘a good faith effort to resolve the

issues raised by the motion’ with opposing party’s counsel [citation omitted]. To be

deemed sufficient, the affirmation must state the nature of the efforts made by the moving

party to resolve the issue with opposing counsel [citations omitted]. Here, Plaintiff’s

affirmation of good faith effort to resolve the dispute with Defendants does not

substantively comply with the requirements of 22 NYCRR 202.7 [citations omitted]. In

the affirmation in support of the motion, Plaintiff’s counsel stated there were good faith

efforts to proceed with disclosure, and highlighted a letter requesting discovery that was

sent to defense counsel for IBA and Procure. However, there is nothing in the letter

indicating the Plaintiff’s counsel actually conferred with defense counsel in a good faith

attempt to resolve the dispute [citations omitted]. Accordingly, the motion to compel

discovery is denied.”

SCOPE OF DISCLOSURE

Matter of Steam Pipe Explosion at 41st Street and Lexington Avenue (Tassa v. Team

Industrial Services, Inc.), 27 N Y 3d 985 (2016) – Last year’s “Update” reported on the


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Appellate Division decision in this action [127 A D 3d 554 (1st Dept. 2015)]. The

Appellate Division held that, “the words ‘material and necessary,’ as used in CPLR

3101(a) are ‘to be interpreted liberally to require disclosure of any facts bearing on the

controversy’ [citation omitted]. ‘The weight to be given evidence of other lawsuits or

claims on the issues of notice and causation, and indeed the very admissibility of such

evidence are not of concern in the context of disclosure’ [citation omitted]. In our view,

the motion court applied too harsh a standard in determining that documents concerning

the prior Diamond Shamrock incident are not discoverable. We are not concerned with

the ultimate admissibility of the evidence at trial, but with the discovery of information

concerning the prior incident, as to which a more liberal standard applies [citation

omitted]. The motion court’s reliance on cases involving the exclusion of testimony or

the evaluation of evidence submitted in opposition to a defendant’s motion for summary

judgment underscores that it applied a more restrictive standard in evaluating the

discoverability of evidence concerning Diamond Shamrock and other incidents.” The

Court of Appeals has affirmed. “The Appellate Division did not abuse its discretion in

granting the motion to compel Team Industrial Services, Inc. to produce its file related to

another action.”

Slomczewski v. Ross, 148 A D 3d 1648 (4th Dept. 2017) – “CPLR 3101(a) provides that,

‘generally, there shall be full disclosure of all matter material and necessary in the

prosecution or defense of an action, regardless of the burden of proof.’ ‘Although the

CPLR does not specifically mention the names and addresses of witnesses or create any

disclosure device for obtaining such information, it is within a court’s discretion to

require a party to disclose the names and addresses of witnesses to transactions,

occurrence, admissions and the like. Thus, a party may reasonably be required to

disclose the name and address of a witness whose identity it has learned in investigating a

case but of whom the opposing party is ignorant’ [citation omitted]. Here, in view of

defendants’ prolonged and almost complete disregard of their pretrial disclosure

obligations with regard to the identity of a known fact witness, it was reasonable for the

court to preclude the individual from testifying as a fact witness.”

INFORMAL DISCOVERY

Caminiti v. Extel West 57th Street LLC, 139 A D 3d 482 (1st Dept. 2016) – “In Arons [v.

Jutkowitz, 9 N Y 3d 393 (2007)], ‘the Court of Appeals provided the framework for

conducting discovery with regard to nonparty healthcare providers, which includes the

use of speaking authorizations’ [citation omitted]. An authorization is required because

physicians, pursuant to the Health Insurance Portability and Accountability Act of 1996

(HIPAA), ‘may not use or disclose an individual’s protected health information to third

parties without a valid authorization.’” Here, a non-physician work-site “medic,” who

examined plaintiff’s deceased and determined to call an ambulance to transport the

decedent to a hospital, fits within the broad definition of “treating physician,” and


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defendants’ motion to compel plaintiff to provide an authorization for an informal

interview with the medic is granted.

Rucinski v. More Restoration Co., Inc., 147 A D 3d 485 (1st Dept. 2017) – “Conflicting

accounts of how plaintiff’s accident took place appear in his medical records, and the

records, alone, do not clarify how the accident occurred.” Defendants therefore

“requested that plaintiff provide authorizations” pursuant to Arons v. Jutkowitz, discussed

directly above, “so that they could depose the medical providers who created the

records.” The Appellate Division affirms the denial of the motion to enforce that request.

“Here, defendants sought depositions of plaintiff’s medical providers pursuant to CPLR

3101(a)(4), not interviews.” Accordingly, “there was no need for plaintiff to provide

HIPAA-compliant authorizations.”

PRE-ACTION DISCLOSURE

Matter of Leff v. Our Lady of Mercy Academy, 150 A D 3d 1239 (2d Dept. 2017) –

“‘Before an action is commenced, disclosure to aid in bringing an action, to preserve

information or to aid in arbitration, may be obtained, but only by court order’ [citations

omitted]. ‘Disclosure to aid in bringing an action’ CPLR 3102(c) authorizes discovery

to allow a plaintiff to frame a complaint and to obtain the identity of the prospective

defendants’ [citations omitted]. However, pre-action disclosure ‘may not be used to

determine whether the plaintiff has a cause of action’ [citations omitted]. This limitation

is ‘designed to prevent the initiation of troublesome and expensive procedures, based

upon a mere suspicion, which may annoy and intrude upon an innocent party’ [citations

omitted]. ‘Where, however, the facts alleged state a cause of action, the protection of a

party’s affairs is no longer the primary consideration and an examination to determine the

identities of the parties and what form or forms the action should take is appropriate’

[citations omitted]. Accordingly, ‘a petition for pre-action discovery limited to obtaining

the identity of prospective defendants should be granted where the petitioner has alleged

facts fairly indicating that he or she has some cause of action.’”

Matter of Barillaro v. The City of New York, 53 Misc 3d 307 (Sup.Ct. Bronx Co.

2016)(Danziger, J.) – “CPLR 3102(c) provides that before an action is commenced,

disclosure to aid in bringing the action, to preserve information or to aid in arbitration,

may be obtained, but only by court order. The First Department has interpreted CPLR

3102(c) as allowing pre-action discovery in order to frame a complaint, to preserve

evidence, and to ascertain the identities of prospective defendants [citations omitted]. ‘A

petition for pre-action discovery should only be granted when the petitioner demonstrates

that he has a meritorious cause of action and that the information sought is material and

necessary to the actionable wrong [citations omitted]. The court has discretion to grant

pre-action disclosure, “to aid in bringing an action or to preserve information” in order to

assist a petitioner in framing his pleadings.’” Here, petitioner seeks production of a video

surveillance tape relating to his personal injury action. The action has not yet been


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commenced because of the condition precedent of a General Municipal Law §50-h

hearing. Hence, this application pursuant to CPLR 3102(c) for pre-action disclosure.

The Court rejects respondent’s argument that “the video is beyond the scope, boundaries

and purpose of the statute governing pre-action discovery,” since disclosure of videos,

pursuant to CPLR 3101(i), would seem to apply only “cases that are already in suit.” The

Court holds that to so limit pre-action disclosure here would put plaintiff at an unfair

disadvantage at the 50-h hearing, and grants the application.

NON-PARTY DISCLOSURE

Matter of Thomson v. Zillow, Inc., 51 Misc 3d 1050 (Sup.Ct. N.Y.Co. 2016)(Jaffe, J.) –

“An application for a protective order or to quash a subpoena issued [to a non-party]

under CPLR 3119 [for a deposition in New York in aid of an out-of-state litigation] must

comply with the rules or statutes of New York State [citation omitted], pursuant to which

the movant bears the burden of showing that the discovery sought is either ‘utterly

irrelevant’ of that the futility of uncovering anything legitimate is ‘inevitable or obvious’

[citations omitted]. If the movant meets its burden, the subpoenaing party must then

establish that the discovery sought is material and necessary, or relevant, to the

prosecution or defense of the action; it need not demonstrate that it cannot obtain the

requested discovery from other sources [citation omitted]. ‘Thus, so long as the

disclosure sought is relevant to the prosecution or defense of an action, it must be

provided by the nonparty.’” Here, “in arguing that respondents have not demonstrated

that they possess relevant information, petitioners attempt to shift the burden of proof on

their motion.”

Harden Street Medical, P.C. v. The Charter Oak Fire Insurance Company, N.Y.L.J.,

1202790388772 (Dist.Ct. Suffolk Co. 2017)(Mathews, J.) – A party to an action may not

seek to quash a subpoena served upon a non-party on the grounds of improper service,

when the non-party “accepted service of the subpoena without objection.”

EXPERT DISCLOSURE

Waldo v. Kang, 139 A D 3d 1365 (4th Dept. 2016) – “The [Supreme] Court improperly

precluded a physician from testifying at trial because of the lack of an expert disclosure.

‘Preclusion of expert testimony for failure to comply with CPLR 3101(d) is improper

unless there is evidence of intentional or willful failure to disclose and a showing of

prejudice by the opposing party’ and, here, defendants failed to provide any evidence of a

willful failure to disclose by plaintiff or any evidence of prejudice.”

Schmitt v. Oneonta City School District, 151 A D 3d 1254 (3d Dept. 2017) – “Unlike the

First, Second and Fourth Departments, this Court interprets CPLR 3101(d)(1)(i) as

‘requiring disclosure to any medical professional, even a treating physician or nurse, who

is expected to give expert testimony.’” And, “contrary to plaintiffs’ assertion, the


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transcript of [the treating physician’s] videotaped testimony cannot serve as a substitute

for the required statutory notice. Simply put, the burden of providing expert witness

disclosure and setting forth the particular details required by the statute lies with the party

seeking to utilize the expert; it is not opposing counsel’s responsibility to cull through

examination before trial testimony or, in this case, the transcript of videotaped trial

testimony to ferret out the qualifications of the subject expert, the facts or opinions that

will form the basis for his or her testimony at trial and/or the grounds upon which the

resulting opinion will be based.”

Rocco v. Ahmed, 146 A D 3d 836 (2d Dept. 2017) – Defendants “were required to

disclose ‘in reasonable detail the subject matter on which each expert is expected to

testify, the substance of the facts and opinions on which each expert is expected to testify

and a summary of the grounds for each expert’s opinion.’ Here, [defendant] Ahmed’s

expert witness disclosure only revealed expert testimony that [plaintiff] 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.” The Appellate Division therefore

reverses an order denying plaintiffs’ motion to set aside the verdict for defendants.

Rivera v. Montefiore Medical Center, 28 N Y 3d 999 (2016) – “The issue on this appeal

is whether the trial court abused its discretion as a matter of law in denying as untimely

plaintiff’s motion to preclude the testimony of defendant’s expert on the grounds that the

CPLR 3101(d) disclosure statement was deficient. We hold that it did not.” Plaintiff’s

deceased died at defendant hospital, allegedly as the result of a failure to properly

diagnose his illness. The autopsy report found the cause of death to be pneumonia,

complicated by diabetes. Defendant’s response to plaintiff’s expert discovery demand

stated that defendant’s expert would testify “on the issue of causation,” and the “possible

causes of the decedent’s injuries and contributing factors.” Plaintiff did not then

challenge the sufficiency of the disclosure. At trial, both the hospital treating physician

and plaintiff’s expert opined that the cause of death was either pneumonia or a cardiac

event, or both. Plaintiff then sought to preclude defendant’s expert “from giving any

testimony regarding any possible causes of the decedent’s death,” claiming that “the

disclosure statement ‘did not include any reasonable detail whatsoever as to what

possible causes’ led to decedent’s death.” The motion was denied as untimely, and the

expert testified that “the cause of death was sudden, lethal cardiac arrhythmia.” The

Appellate Division agreed that “plaintiff failed to timely object to the lack of specificity

in the expert disclosure statement and that plaintiff was not justified in assuming that the

defense expert’s testimony would comport with the autopsy report’s conclusion.” The

Court of Appeals has affirmed. “Plaintiff made her motion mid-trial immediately prior to


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the expert’s testimony. Plaintiff argues that at the time of the expert exchange, she had

no reason to object to the disclosure statement because the statement gave no indication

that defendant would challenge plaintiff’s theory of decedent’s cause of death. Assuming

defendant’s disclosure was deficient, such deficiency was readily apparent; the disclosure

identified ‘causation’ as a subject matter but did not provide any indication of a theory or

basis for the expert’s opinion. This is not analogous to a situation in which a party’s

disclosure was misleading or the trial testimony was inconsistent with the disclosure.

Rather, the issue here was insufficiency. The trial court’s ruling did not endorse the

sufficiency of the statement but instead addressed the motion’s timeliness. The lower

courts were entitled to determine, based on the facts and circumstances of this particular

case, that the time to challenge the statement’s content had passed because 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. Accordingly, there was no abuse

of discretion as a matter of law.”

Prutzman v. Albany Medical Center, N.Y.L.J., 1202756726113 (Sup.Ct. Warren Co.

2016)(Muller, J.) – In this medical malpractice case, defendant moves to preclude

plaintiff’s expert from testifying, claiming that the expert disclosure gave insufficient

detail as to the expert’s education and employment history. The Court notes that, in

1985, when CPLR 3101(d)(1)(i) was enacted, “the Advisory Committee on the CPLR

was ‘concerned with “unique problems” that mandatory pretrial identification of expert

witnesses in malpractice cases would pose, reasoning that disclosure of the names of

expert witnesses would allow doctors impermissibly to dissuade colleagues from

testifying for plaintiffs’ [citation omitted]. An additional consideration for concealing

identity was undoubtedly the locality rule with roots long set in Pike v. Honsinger, 155

N.Y. 201 [1898] within which the Court of Appeals articulated the requirement that the

medical expert was required to possess ‘that reasonable degree of learning and skill

ordinarily possessed by physicians and surgeons in the locality where he practices’

[citation omitted]. Doubtless, a local physician testifying against a local physician was

certainly next to impossible to coordinate when faced with disclosure amongst that local

community’s practitioners. In 1985 such nondisclosure – simply the omission of a name

– carried a sufficient guarantee that an expert’s identity was effectively shielded. Since

that time, however, has come the internet of many things. Commercial internet service

providers began to emerge in the very late 1980s and by the mid 1990s their traffic went

from a trickle to a tsunami, pushing at its crest wide-ranging and easily accessible

research tools in all of the disciplines – not envisioned three decades ago – including the

fee-based service ‘Board Certified Docs’ which the plaintiff sufficiently demonstrates

would easily come close to, if not precisely landing upon, their expert’s identity if the

defense were given the further details it seeks. The Advisory Committee could not then

have been aware of these for better – or worse – advances in information technology

applications throughout this state. Being guided here, however, by the Meade [v.

Rajadhyax Dental Group, 34 A D 3d 1139 (3d Dept. 2006)] standard plaintiffs in camera


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affirmation of counsel presents proof sufficient to support a finding of the reasonable

probability that the further information sought would lead to the disclosure of the actual

identity of the expert. Until CPLR 3101(d)(1) is freed from the ether of 1985 when it was

enacted it shall remain possible for defendants to seek to preclude and for plaintiffs to

move for protective orders in which the burden to demonstrate the need for nondisclosure

must be carefully carried, as has happened here. It cannot be left unobserved that one of

the primary reasons for the 1985 legislation, far from attained in 2016 as this decision

demonstrates, was to expedite the resolution of malpractice claims in order to reduce

litigation costs [citation omitted]. Defendants’ motion to preclude is denied. Plaintiff has

sufficiently disclosed her expert’s qualifications for the limited purposes of this CPLR

3101(d)(1) analysis.”

Conway v. Elite Towing & Flatbedding Corp., 135 A D 3d 893 (2d Dept. 2016) – “The

defendants’ expert disclosure statements sufficiently disclosed in reasonable detail the

subject matter and the substance of the facts and opinions on which the experts were

expected to testify, and a summary of the grounds for their opinions [citations omitted].

Contrary to the plaintiff’s contention, there is no requirement that the expert set forth the

specific facts and opinions upon which he or she is expected to testify, but rather only the

substance of those facts and opinions.”

Nieto v. Deveau, 51 Misc 3d 1027 (Civ.Ct. Kings Co. 2016)(Montelione, J.) – “The

failure to serve a CPLR 3101(d) notice with regard to a treating physician is not grounds

for preclusion of the physician’s expert testimony as to causation where there has been

disclosure of the physician’s records and reports, pursuant to CPLR 3121 and 22 NYCRR

202.17.”

PRIVILEGES

IN GENERAL

Matter of People v. PriceWaterhouseCoopers, LLP, 150 A D 3d 578 (1st Dept. 2017) –

“In this proceeding arising from an underlying investigation by the N[ew] Y[ork]

A[ttorney] G[eneral] into alleged fraud by respondent Exxon concerning its published

climate change information, the motion court properly found that the New York law on

privilege, rather than Texas law, applies, and that New York law does not recognize an

accountant-client privilege. We reject Exxon’s argument that an interest-balancing

analysis is required to decide which state’s choice of law should govern the evidentiary

privilege. Our current case law requires than when we are deciding privilege issues, we

apply the law of the place where the evidence will be introduced at trial, or the place

where the discovery proceeding is located [citations omitted]. In light of our conclusion

that New York law applies, we need not decide how this issue would be decided under

Texas law.”


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ATTORNEY-CLIENT PRIVILEGE

TD Bank, N.A. v. Interstate Fire Protection, Inc., N.Y.L.J., 1202756840676 (Sup.Ct.

N.Y.Co. 2016)(Helewitz, Sp.Ref.) – In this hearing to assess attorneys’ fees, plaintiff

sought to introduce heavily redacted invoices to prove the fees paid. “It is well-settled

that fee arrangements between an attorney and a ‘client do not ordinarily constitute a

confidential communication and thus are not privileged in the usual case.’” Moreover,

“the attorney-client privilege only attaches to the substance of the communication made

by the attorney to the client or the client to the attorney, not to the fact that the attorney

and the client had a communication [citation omitted]. Hence, counsel should only be

permitted to redact the legal advice appearing on the invoice, not the fact that a

conversation concerning a particular aspect of the subject litigation occurred.” Thus,

“since defendants are entitled to review the invoices to ascertain whether interviews,

conversations or correspondence with particular individuals were appropriately related to

the representation for which they were ordered to reimburse plaintiff, plaintiff’s counsel

was required to submit copies of the invoices in which only the actual communications

are redacted from the items.”

ACE Securities Corp. v. DB Structured Products, Inc., 55 Misc 3d 544 (Sup.Ct. N.Y.Co.

2016)(Bransten, J.) – “‘To the extent that the request for [legal] advice attaches business

records created in the ordinary course of business, those business records do not become

privileged because copies are also sent to counsel in connection with a request for

advice.’”

Stock v. Schnader Harrison Segal & Lewis LLP, 142 A D 3d 210 (1st Dept. 2016) – “The

primary issue on this appeal is whether attorneys who have sought the advice of their law

firm’s in-house general counsel on their ethical obligations in representing a firm client

may successfully invoke attorney-client privilege to resist the client’s demand for the

disclosure of communications seeking or giving such advice. We hold that such

communications are not subject to disclosure to the client under the fiduciary exception

to the attorney-client privilege [citation omitted] because, for purposes of the in-firm

consultation on the ethical issue, the attorneys seeking the general counsel’s advice, as

well as the firm itself, were the general counsel’s ‘real clients’ [citations omitted].

Further, we decline to adopt the ‘current client exception,’ under which a number of

courts of other jurisdictions [citations omitted] have held a former client entitled to

disclosure by a law firm of any in-firm communications relating to the client that took

place while the firm was representing that client.” For, “nothing in CPLR 4503 suggests

that consultations between a law firm, as client, and its in-house counsel, as attorney, are

not covered by the privilege.” And, “whether the fiduciary exception applies depends on

whether the ‘real client’ of the attorney from whom the fiduciary sought advice was the

beneficiary of the fiduciary relationship or, alternatively, the fiduciary in his or her

individual capacity.” The fiduciary exception “does not apply to the attorney-client


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communications of a fiduciary who seeks legal advice to protect his or her own

individual interests, rather than to guide the fiduciary in the performance of his or her

duties to the beneficiary.” The Court noted that “in recent years” the Courts of other

states “have held that the fiduciary exception to the attorney-client privilege, assuming

that the jurisdiction recognizes it, does not apply to communications between lawyers and

their firm’s in-house counsel addressing such concerns arising from the ongoing

representation of a firm client” [emphasis by the Court], as well as a similar resolution by

the American Bar Association. Thus, here, because the “attorneys were the ‘real clients’

for purposes of these attorneys’ consultation with Kipnes, the firm’s in-house general

counsel, whose time spent on the consultation was not billed to plaintiff and who never

worked on any matter for plaintiff,” the privilege applies, and the fiduciary exception

does not.

Fragin v. First Funds Holdings, LLC, N.Y.L.J., 1202765286210 (Sup.Ct. N.Y.Co. 2016)

(Bransten, J.) – “The crime-fraud exception [to the attorney-client privilege] encompasses

‘a fraudulent scheme, an alleged breach of fiduciary duty or an accusation of some other

wrongful conduct’ [citation omitted]. A party seeking to invoke the crime-fraud

exception must demonstrate that there is a factual basis for a showing of probable cause

to believe: (1) that a fraud or crime has been committed and (2) that the communications

in question were in furtherance of the fraud or crime.” The Court need not find that the

attorney “knowingly participated in [the] allegedly fraudulent conduct.” It is enough that

the documents sought in discovery “demonstrate work” by the attorney on behalf of the

client which relate to conduct by the client that fits within the exception.

ATTORNEY WORK PRODUCT

Cioffi v. S.M. Foods, Inc., 142 A D 3d 520 (2d Dept. 2016) – Last year’s “Update”

reported on Geffner v. Mercy Medical Center, 125 A D 3d 802 (2d Dept. 2015), in which

the Second Department held that, “attorney work product under CPLR 3101(c), which is

subject to an absolute privilege, is generally limited to materials prepared by an attorney,

while acting as an attorney, which contain his or her legal analysis, conclusions, theory,

or strategy [citations omitted]. ‘The mere fact that a narrative witness statement is

transcribed by an attorney is not sufficient to render the statement “work product”’

[citation omitted]. Contrary to the plaintiff’s contention, she did not meet her burden of

establishing that the audio recording of an interview she conducted with the defendant

Nicoletta Starks prior to the commencement of the instant action constituted attorney

work product. Among other things, the plaintiff failed to show that the recording

contained elements of opinion, analysis, theory, or strategy.” Similarly, here in Cioffi,

the Second Department holds that, “‘not every manifestation of a lawyer’s labors enjoys

the absolute immunity of work product. The exemption should be limited to those

materials which are uniquely the product of a lawyer’s learning and professional skills,

such as materials which reflect his or her legal research, analysis, conclusions, legal


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theory or strategy’ [citations omitted]. Here, the plaintiffs contend that materials

obtained by their attorney via requests pursuant to state and federal freedom of

information laws are privileged attorney work product. However, the material cannot be

characterized as being ‘uniquely the product of the plaintiffs’ counsel’s learning and

professional skills’ or as reflecting his ‘legal research, analysis, conclusion, legal theory

or strategy.’”


2016)(Bransten, J.) – To establish that documents are protected attorney work product,

the party seeking protection “must demonstrate that the documents were ‘primarily

prepared in anticipation of litigation and are, thus privileged matter.’” Here, defendant’s

“breach analysis” was not protected, even after counsel provided advice with respect to it,

because that was, “in effect, giving advice ‘about how to conduct the ordinary course of

defendant’s business,’” since defendant was contractually obligated to perform such

analyses. Thus, “neither the introduction of lawyers nor the fear of imminent litigation

converted that business function into work product.”

Peerenboom v. Marvel Entertainment, LLC, 148 A D 3d 531 (1st Dept. 2017) – Although

defendant’s e-mail correspondence with his attorney was on his employer’s computer

system, and the employer had specified that “it ‘owned’ all emails on its system,” with

the right to access and audit, “given the lack of evidence that Marvel viewed any of

Perlmutter’s personal emails, and the lack of evidence of any other actual disclosure to a

third party, Perlmutter’s use of Marvel’s email for personal purposes does not, standing

alone, constitute a waiver of attorney work product protection.” The Court, however,

held – as discussed infra – that the use of Marvel’s email in communications with

Perlmutter’s wife did waive the spousal privilege.

Miller v. Zara USA, Inc., 151 A D 3d 462 (1st Dept. 2017) – “Plaintiff lacked any

reasonable expectation of privacy in his personal use of the laptop computer supplied to

him by defendant Zara USA, Inc. (Zara), his employer, and thus lacked the reasonable

assurance of confidentiality that is fundamental to attorney-client privilege [citations

omitted]. Among other factors, Zara’s employee handbook, of which plaintiff, Zara’s

general counsel, had at least constructive knowledge [citations omitted], restricted use of

company-owned electronic resources, including computers, to ‘business purposes’ and

proscribed offensive uses. The handbook specified that ‘any data collected, downloaded

and/or created’ on its electronic resources was ‘the exclusive property of Zara,’

emphasized that ‘employees should expect that all information created, transmitted,

downloaded, received or stored in Zara’s electronic communications resources may be

accessed by Zara at any time, without prior notice,’ and added that employees ‘do not

have an expectation of privacy or confidentiality in any information transmitted or stored

in Zara’s electronic communication resources (whether or not such information is

password-protected).’ Plaintiff avers, and defendant does not dispute, however, that,


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while reserving a right of access, Zara in fact never exercised that right as to plaintiff’s

laptop and never actually viewed any of the documents stored on that laptop. Given the

lack of any ‘actual disclosure to a third party, plaintiff’s use of Zara’s computer for

personal purposes does not, standing alone, constitute a waiver of attorney work product

protections.’”

MATERIAL CREATED FOR LITIGATION

Hewitt v. Palmer Veterinary Clinic, PC, 145 A D 3d 1415 (3d Dept. 2016) – “Inasmuch

as ‘the purpose of liability insurance is the defense and settlement of claims once an

accident has arisen,’ documents contained in the insurance adjuster’s file are generally

protected by ‘a conditional immunity as material prepared for litigation’ [citations

omitted]. Accident reports that are prepared with ‘a mixed purpose and result at least in

part from the internal operations of the defendant’s business’ are not, however, exempt

from disclosure’ [citations omitted]. It is therefore incumbent upon ‘the party resisting

disclosure to, in the first instance, show that the materials sought were prepared solely for

litigation and this burden cannot be satisfied with wholly conclusory allegations.’”

Veltre v. Rainbow Convenience Store, Inc., 146 A D 3d 416 (1st Dept. 2017) – Here the

insurer’s claim 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.”

Curci v. Foley, 149 A D 3d 1388 (3d Dept. 2017) – Five days after the accident at issue,

defendant’s insurer’s claims representative contacted defendant, had a taped phone

conversation with him, and thereafter provided him with a transcript of that conversation.

The Appellate Division reverses the denial of defendant’s motion for a protective order

with respect to the transcript. “‘The purpose of liability insurance is the defense and

settlement of claims and, once an accident has arisen, there is little or nothing that the

insurer or its employees do with respect to accident reports except in preparation for

eventual litigation or for a settlement which may avoid litigation.’ [citation omitted]. As

such, an insurer’s file is generally protected by ‘a conditional immunity as material

prepared for litigation.’” Of course, “accident reports prepared with a mixed purpose,

however, are not exempt from disclosure.” But, here, there was “no indication that the

statement was taken for some purpose other than preparing for litigation.”

THE COMMON INTEREST “PRIVILEGE”

Peerenboom v. Marvel Entertainment, LLC, 148 A D 3d 531 (1st Dept. 2017) – The

“common interest doctrine” does not, in and of itself “constitute a source of privilege.” It

is merely an exception to the waiver rule of the attorney-client privilege.


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Ambac Assurance Corporation v. Countrywide Home Loans, Inc., 27 N Y 3d 616 (2016)

– A prior year’s “Update” reported on the Appellate Division decision in this action

[124 A D 3d 129 (1st Dept. 2014)]. The Appellate Division, rejecting a line of Second

Department cases [see, Hyatt v. State of California Franchise Tax Board, 105 A D 3d

186 (2d Dept. 2013); Hudson Valley Marine, Inc. v. Town of Cortlandt, 30 A D 3d 377

(2d Dept. 2006)], held that, “in today’s business environment, pending or reasonably

anticipated litigation is not a necessary element of the common-interest privilege. Our

conclusion holds particularly true in this case, where the parties have a common legal

interest because they were engaged in merger talks during the relevant period and now

have a completed and signed merger agreement.” To “properly understand the common-

interest doctrine, it is necessary to examine the purpose of the privilege from which it

descends – namely, the attorney-client privilege. The attorney-client privilege is ‘the

oldest among common-law evidentiary privileges’ [citation omitted]. The purpose of this

privilege ‘is to encourage full and frank communication between attorneys and their

clients and thereby promote broader public interests in the observance of law and

administration of justice.’” Further, “the ‘attorney-client privilege is not tied to the

contemplation of litigation,’ because ‘advice is often sought, and rendered, precisely to

avoid litigation, or facilitate compliance with the law, or simply to guide a client’s course

of conduct [citation omitted]. For that reason, and because of ‘the vast and complicated

array of regulatory legislation confronting the modern corporation, corporations, unlike

most individuals, constantly go to lawyers to find out how to obey the law, particularly

since compliance with the law in this area is hardly an instinctive matter.’” Accordingly,

the Appellate Division held that, “so long as the primary or predominant purpose for the

communication with counsel is for the parties to obtain legal advice or to further a legal

interest common to the parties, and not to obtain advice of a predominantly business

nature, the communication will remain privileged.” The cases holding to the contrary

“provide that when two parties with a common legal interest seek advice from counsel

together, the communication is not privileged unless litigation is within the parties’

contemplation; on the other hand, when a single party seeks advice from counsel, the

communication is privileged regardless of whether litigation is within anyone’s

contemplation. We cannot reconcile this contradiction, as it undermines the policy

underlying that attorney-client privilege.” A divided Court of Appeals has reversed.

“We hold today, as the courts in New York have held for over two decades, that any such

communication must also relate to litigation, either pending or anticipated, in order for

the [common interest] exception to apply.” Because the attorney-client privilege “shields

from disclosure pertinent information and therefore ‘constitutes an “obstacle” to the

truth-finding process,’ it must be narrowly construed.” The common interest privilege,

the majority noted, “has its roots in criminal law and, as originally conceived, ‘allowed

the attorneys of criminal co-defendants to share confidential information about defense

strategies without waiving the privilege as against third parties.’” The rationale was “that

the parties ‘had the same defense to make’ and therefore ‘the counsel of each was in


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effect the counsel of all’ [citation omitted]. Courts eventually replaced this ‘joint

defense’ doctrine, which applied to criminal codefendants, with a broader exception that

also protected communications between parties to civil litigation.” The Court declines to

extend the exception beyond that. “Disclosure is privileged between codefendants,

coplaintiffs or persons who reasonably anticipate that they will become colitigants,

because such disclosures are deemed necessary to mount a common claim or defense, at a

time when parties are most likely to expect discovery requests and their legal interests are

sufficiently aligned that ‘the counsel of each is in effect the counsel of all’ [citation

omitted]. When two or more parties are engaged in or reasonably anticipate litigation in

which they share a common legal interest, the threat of mandatory disclosure may chill

the parties’ exchange of privileged information and therefore thwart any desire to

coordinate legal strategy. In that situation, the common interest doctrine promotes candor

that may otherwise have been inhibited. The same cannot be said of clients who share a

common legal interest in a commercial transaction or other common problem but do not

reasonably anticipate litigation.” In sum, “we do not perceive a need to extend the

common interest doctrine to communications made in the absence of pending or

anticipated litigation, and any benefits that may attend such an expansion of the doctrine

are outweighed by the substantial loss of relevant evidence, as well as the potential for

abuse.” The dissenters argued that “given 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.”


2016)(Bransten, J.) – “The common interest privilege has protected documents shared by

parties ‘facing common problems in pending or threatened civil litigation’ [citations

omitted]. The determination of whether two parties share a common legal interest cannot

be made categorically [citations omitted]. Indeed, the privilege may exist despite an

adversarial relationship between the two parties asserting it [citations omitted]. ‘What is

important is not whether the parties theoretically share similar interests but rather whether

they demonstrate actual cooperation toward a common legal goal.’”

Matter of San Diego Gas & Electric Company v. Morgan Stanley Senior Funding, Inc.,

136 A D 3d 547 (1st Dept. 2016) – “The common interest privilege is an exception to the

rule that the presence of a third party will waive a claim that a communication is

confidential. It requires that the communication otherwise qualify for protection under

the attorney-client privilege and that it be made for the purpose of furthering a legal

interest or strategy common to the parties asserting it [citation omitted]. We find that

Morgan Stanley and NaturEner shared a common interest in their desire to have plaintiff


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comply with its contractual obligations under the Rim Rock agreements. The fact that

respondent and defendant were in a debtor-creditor relationship did not make their

interests adverse in all matters and at all times.”

Levy v. Arbor Commercial Funding, LLC, 138 A D 3d 561 (1st Dept. 2016) – “The

motion court incorrectly determined that an alleged conversation between the parties’

counsel during a federal forfeiture proceeding involving the condominium unit at issue in

this action is rendered inadmissible by the common-interest privilege. The common

interest privilege serves as an exception to the general rule that the presence of a third

party at a communication between counsel and client will waive a claim that a

communication is confidential [citations omitted]. ‘Under this doctrine, a third party may

be present at the communication between an attorney and a client without destroying the

privilege if the communication is for the purpose of furthering a nearly identical legal

interest shared by the client and the third party’ [citation omitted]. Here, while it may be

the case that during the federal action, plaintiff and defendants sought to establish the

validity of their mortgage interests in the condominium, as well as to expedite the sale of

the condominium to limit potential investment losses, this is of no moment, because the

common interest doctrine does not create a privilege. Rather, it operates only to prevent

waiver of the attorney client privilege and is, therefore, inapplicable in this case.”

Moreover, nothing in the caselaw suggests that “communications subject to the common

interest privilege are considered privileged as between the parties themselves in a later

dispute; rather, the communications between the parties are privileged with respect to

third parties.”

Deep Woods Holdings LLC v. Pryor Cashman LLP, N.Y.L.J., 1202760626735 (Sup.Ct.

N.Y.Co. 2016)(Scarpulla, J.) – In this legal malpractice action, the Court holds that

“under New York law, ‘attorney-client privilege may not be raised to prevent disclosure

of communications relevant to the common interest of former joint clients in subsequent

litigation’” brought by one of them.

OTHER PRIVILEGES

Carothers v. Progressive Insurance Company, 150 A D 3d 192 (2d Dept. 2017) – “While

a party’s invocation of the privilege against self-incrimination can generally be used to

draw an adverse inference against that party in a civil action [citations omitted], no such

inference may be drawn when, as here, the privilege is invoked by a nonparty witness.”

Matter of Murray Energy v. Reorg Research, N.Y.L.J., 55 Misc 3d 669 (Sup.Ct. N.Y.Co.

2017)(Edmead, J.), rev’d, ___ A D 3d ___, 2017 WL 2977781 (1st Dept. 2017) – This is

an application for pre-action disclosure pursuant to CPLR 3102(c). Petitioner seeks

information from respondent as to the source of information respondent published about

petitioner, claiming the information had to come from one of its investors, in violation of


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a confidentiality agreement. Respondent claims that it is entitled to the protection of the

“Shield Law,” Civil Rights Law §79-h. Supreme Court concludes that respondent is not

a “professional journalist” entitled to the law’s protection. Respondent has some 375

subscribers, who pay from $30,000 to $120,000 per year. Those subscribers must sign

confidentiality agreements, promising to withhold the information provided by

respondent from the general public. The statute defines a professional journalist as an

individual or organization “which has as one of its regular functions the processing and

researching of news intended for dissemination to the public” [emphasis by the Court].

Respondent does not fit within the statute’s scope or purpose, and is therefore not entitled

to the privilege. The Appellate Division has reversed. The features listed by Supreme

Court “are not uncommon among, and in fact are essential to the economic viability of,

specialty or niche publications that target relatively narrow audiences by focusing on a

topic not ordinarily covered by the general news media – such as the debt-distressed

market.” And, “significantly, respondent established that its editorial staff is solely

responsible for deciding what to report on and that it does not accept compensation for

writing about specific topics or permit its subscribers to dictate the content of its

reporting. Other courts have found the extent of a publication’s independence and

editorial control to be important in determining whether to apply the Shield Law.” In

sum, “extending protection to respondent under the Shield Law is consistent with New

York’s ‘long tradition, with roots dating back to the colonial era, of providing the utmost

protection of freedom of the press’ – protection that has been recognized as ‘the strongest

in the nation’ [citation omitted]. To condition coverage on a fact-intensive inquiry

analyzing a publication’s number of subscribers, subscription fees, and the extent to

which it allows further dissemination of information is unworkable and would create

substantial prospective uncertainty, leading to a potential ‘chilling’ effect.”

Peerenboom v. Marvel Entertainment, LLC, 148 A D 3d 531 (1st Dept. 2017) –

Defendant’s communications with his wife, using his employer’s e-mail system, do not

get the benefit of the spousal privilege. “Among other factors, while Marvel’s email

policies during the relevant time periods permitted ‘receiving e-mail from a family

member, friend, or other non-business purpose entity as a courtesy,’ the company

nonetheless asserted that it ‘owned’ all emails on its system, and that the emails were

‘subject to all Company rules, policies, and conduct statements.’ Marvel ‘reserved the

right to audit networks and systems on a periodic basis to ensure employees’ compliance’

with its email policies. It also ‘reserved the right to access, review, copy and delete any

messages or content,’ and ‘to disclose such message to any party (inside or outside the

Company).’ Given, among other factors, Perlmutter’s status as Marvel’s Chair, he was, if

not actually aware of Marvel’s email policy, constructively on notice of its contents.”

Thus, “Perlmutter’s use of Marvel’s email system for personal correspondence with his

wife waived the confidentiality necessary for a finding of spousal privilege.” In addition,

the Court noted that “there is no accountant-client privilege in this state.”


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Abraha v. Adams, 148 A D 3d 1730 (4th Dept. 2017) – In this medical malpractice

action, relating to defendants’ treatment of plaintiff after she was assaulted by her

husband, defendants seek records “from the shelter for domestic violence victims where

she was living at the time of the assault.” The Court concludes that “the shelter records

are not protected by any privilege, and they are thus subject to disclosure to the extent

that they are material and necessary to the defense of the action [citations omitted]. Even

assuming, arguendo, that the records were prepared by licensed social workers, which is

not evident from the records themselves, we conclude that plaintiff waived any privilege

afforded by CPLR 4508 by affirmatively placing her medical and psychological

condition in controversy through the broad allegations of injury in her bills of particulars

[citations omitted]. Inasmuch as defendants are not seeking disclosure of the street

address of the shelter, we reject plaintiff’s contention that Social Services Law §459-h

precludes disclosure of the records. Furthermore, 18 NYCRR 452.10(a), which renders

confidential certain information ‘relating to the operation of residential programs for

victims of domestic violence and to the residents of such programs,’ does not preclude

disclosure of the records because that regulation allows for access to such information ‘as

permitted by an order of a court of competent jurisdiction [citation omitted]. That

regulation does not preclude a court from ordering disclosure of shelter records that are

material and necessary to the defense of an action.”

Estate of Savage v. Kredentser, 150 A D 3d 1452 (3d Dept. 2017) – “Education Law

§6527(3) and Public Health Law §2805-m protect from disclosure records relating to

performance of a medical or quality assurance review function or participation in a

medical malpractice prevention program [citations omitted]. The party asserting these

statutory privileges bears the burden of establishing their applicability by demonstrating

that a review procedure was in place and that the requested documents were prepared in

accordance with such procedure.” Here, “defendants failed to meet their burden of

establishing the report’s privilege. Defendants did not submit an affidavit or other

information from anyone with first-hand knowledge establishing that a review procedure

was in place or that the report was obtained or maintained in accordance with any such

review procedure.” Thus, “in short, the purpose of the Education Law and Public Health

Law discovery exclusions is to encourage a candid peer review of physicians, and thereby

improve the quality of medical care and prevent malpractice [citations omitted], but such

protections are not automatically available and do not prevent full disclosure where it

should otherwise be provided.”

Phillips v. The City of New York, N.Y.L.J., 54 Misc 3d 294 (Sup.Ct. Bronx Co. 2016)

(Danziger, J.) – Plaintiff, a special education teacher employed at a hospital, sues for

injuries caused by an assault by a patient, and seeks production of the incident report

generated by the hospital. “‘Education Law §6527(3) exempts, inter alia, incident

reports prepared pursuant to Mental Hygiene Law §29.29 from disclosure. Incident

reports are defined as “reports of accidents and injuries affecting patient health and


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welfare.” Included in such reports are any allegations of “violent behavior exhibited by

either patients or employees.”’” Here, “the court finds that a charge of assault based

upon a patient’s conduct, as alleged here, clearly and automatically falls within the

category of items deemed confidential.” And, “plaintiff’s argument that the incident

report is exempted from the privilege to the extent that it contains statements made by the

plaintiff herself is unpersuasive. Education Law §6527(3) provides, inter alia, that ‘no

person in attendance at a meeting when an incident reporting function was performed,

including the investigation of an incident reported pursuant to section 29.29 of the Mental

Hygiene Law, shall be required to testify as to what transpired thereat. The prohibition

relating to discovery of testimony, shall not apply to statements made by any person in

attendance at such meeting who is a party to an action or proceeding the subject matter of

which was reviewed at such meeting.’ Plaintiff asserts that based upon the above cited

statute and because she is a party to this action, she is entitled to disclosure of the incident

report. The court disagrees. The statute, by its own clear language, applies to situations

where the discovery sought is the ‘testimony’ of an individual and not the incident report

itself.”

Jousma v. Kolli, 149 A D 3d 1520 (4th Dept. 2017) – Hospital credentialing files “‘fall

squarely within the materials that are made confidential by Education Law §6527(3) and

article 28 of the Public Health Law’ [citations omitted]. That privilege shields from

disclosure ‘the proceedings and the records relating to performance of a medical or a

quality assurance review function or participation in a medical malpractice prevention

program.’” Although “there is an exception to the privilege, the exception is limited to

those statements made by a doctor to his or her employer-hospital concerning the subject

matter of a malpractice action and pursuant to the hospital’s quality-control inquiry into

the incident underlying the action.”

Smith v. Watson, 150 A D 3d 487 (1st Dept. 2017) – “[Supreme] Court erred in denying

defendants’ motion [to compel production of documents by nonparty New York City

Police Department] outright because of the prior denials of their requests for the same

information under the Freedom of Information Law (FOIL). ‘CPLR article 31 is not a

statute “specifically exempting” public records from disclosure under FOIL’ and ‘no

provision of FOIL bars simultaneous use of both’ CPLR 3101 and FOIL to procure

discovery [citations omitted]. The ‘public interest’ privilege did not justify the outright

denial of defendants’ motion, because the court did not engage in the requisite balancing

of the public interest in encouraging witnesses to come forward to cooperate in pending

criminal investigations against defendants’ need for the documents to defend against

plaintiffs’ claim.”

Mosey v. County of Erie, 148 A D 3d 1572 (4th Dept. 2017) – The “deliberative process

privilege” is also known as “the ‘inter-agency or intra-agency materials’ exemption under

Public Officers Law §87(2)(g)’ [citation omitted]. The question is whether that statutory


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exemption contained in the Freedom of Information Law [citation omitted] also applies to

discovery in civil actions. We conclude that it does not. Both the CPLR and FOIL

provide for disclosure of documents. The former controls discovery between litigants in

court proceedings, and the latter permits disclosure of governmental records to the public

even in the absence of litigation. ‘When a public agency is one of the litigants, this

means that it has the distinct disadvantage of having to offer its adversary two routes into

its records’ [citations omitted]. The deliberative process privilege or exemption under

FOIL seeks ‘to protect the deliberative process of the government by ensuring that

persons in an advisory role will be able to express their opinions freely to agency

decision makers’ [citation omitted]. While some courts have applied that privilege

outside the FOIL context [citations omitted], we decline to do so inasmuch as the Court

of Appeals ‘has never created nor recognized a generalized “deliberative process

privilege”’ [citation omitted]. We ‘recognize the existence of some cases which all too

casually mention the “deliberative process privilege” and purport to apply it outside the

context of a FOIL proceeding’ [citation omitted]. Nevertheless, it is also important to

recognize that ‘privileges simply do not exist in the absence of either constitutional or

statutory authority, or, when created as a matter of jurisprudence’ [citation omitted].

Although the County seeks to assert ‘the so-called “deliberative process privilege”’ in the

context of a civil litigation, ‘neither the Court of Appeals’ case law nor that of the Fourth

Department can be construed as having created a distinct “deliberative process privilege”

outside the context of a FOIL proceeding.’”

PRIVILEGE LOGS

Arkin Kaplan Rice LLP v. Kaplan, N.Y.L.J., 1202780556815 (Sup.Ct. N.Y.Co.)

(Helewitz, Sp.Ref.) – A privilege log may itself be admissible, not for the content of any

of the assertedly privileged documents, but for the information contained on the log –

here demonstrating that the attorney met with the witness on particular days. The

privilege only extends to the “substance of the communication between counsel and

client,” not to the fact that it occurred.

DEPOSITIONS

Walker v. City of New York, 140 A D 3d 739 (2d Dept. 2016) – “Although a municipality,

in the first instance, has the right to determine which of its officers or employees with

knowledge of the facts may appear for a deposition, a plaintiff may demand production of

additional witnesses when (1) the officers or employees already deposed had insufficient

knowledge or were otherwise inadequate as witnesses, and (2) there is a substantial

likelihood that the person sought for deposition possesses information which is material

and necessary to the prosecution of the case [citations omitted]. The burden is upon the

examining party to make a showing as to both factors.”


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Matter of Empire Wine & Spirits LLC v. Colon, 145 A D 3d 1157 (3d Dept. 2016) –

Although decided in the context of an administrative proceeding, the Court’s analysis

here applies equally to depositions in civil litigation. “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’ [citations omitted]. [Witness] 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.’” For, “‘a subpoena will be quashed only where the futility of the process to

uncover anything legitimate is inevitable or obvious or where the information sought is

utterly irrelevant to any proper inquiry.’”

Torres v. Board of Education of City of New York, 137 A D 3d 1256 (2d Dept. 2016) –

“CPLR 3116(a) provides that a witness may make ‘changes in form or substance’ to his

or her deposition testimony as long as such changes are accompanied by ‘a statement of

the reasons given by the witness for making them.’ A correction will be rejected where

the proffered reason for the change is inadequate [citations omitted]. Further, material or

critical changes to testimony through the use of an errata sheet is also prohibited [citation

omitted]. Here, the defendants demonstrated that the plaintiff made numerous and

significant corrections to his deposition testimony on his errata sheets. Such corrections

sought to substantively change portions of the plaintiff’s deposition testimony which

would have been in conflict with his earlier testimony at his General Municipal Law §50-

h hearing on issues concerning the basis for the defendants’ alleged negligence as alleged

in the plaintiff’s pleadings [citation omitted]. Moreover, the plaintiff’s stated reasons that

he ‘mis-spoke’ and that he was clarifying his testimony were inadequate to warrant the

corrections.”

Murillo v. The City of New York, N.Y.L.J., 1202776765237 (Sup.Ct. N.Y.Co. 2016)

(d’Auguste, J.) – CPLR 3116(a) provides that “no changes to the transcript may be made

by the witness more than sixty days after the submission to the witness for examination.”

Here, “the deadline for plaintiff’s changes was April 7, 2016, yet the explanations to

plaintiff’s EBT changes and affidavit of translation were e-filed with his first set of

opposition papers on April 12, 2016. Although the Court may extend time under CPLR

2004, such relief is appropriate only upon a showing of good cause [citation omitted].

‘Courts should be circumspect about extending the 60-day period inasmuch as “an

indication from the courts that an extension will be allowed without a strong showing of

justification will quickly evolve a dilatory attitude than can undermine the purpose of

CPLR 3116(a)’s time limit altogether”’ [citation omitted]. Even though the second


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submission is untimely by a mere few days, plaintiff failed to give any justification for

the delay in providing reasons or explanations for the EBT changes. Therefore, the

motions could be granted on this basis alone.” But, “even if the Court were to consider

the untimely errata sheets, the motions [to strike the errata sheets] are still granted. First,

some of the corrections are not accompanied by a reason or explanation for the change;

therefore, those should not be permitted.” For example, “plaintiff already attempted to

correct the March 4th date [that he testified the accident occurred] to February 4th on the

record after a lunch break – and the current attempt to now claim that he ‘misspoke’ and

change the numerous instances when he said March 4th, prior to the lunch break, to read

as if he said February 4th, are suspect at best [citation omitted]. Additionally, any

changes sought to make plaintiff’s EBT consistent with his GML 50-h testimony should

also be rejected here [citation omitted]. Further, ‘the plaintiff’s assertion in his

opposition papers that the corrections were necessitated by confusion in the translation of

his testimony by an interpreter is not supported by the record’ [citation omitted]. Moving

defendants note, and this Court agrees, that any confusion from the translation was

cleared on the record – the questions were read back to plaintiff and there is no indication

that he did not understand after the interpreter explained what was being asked.

Moreover, there is no indication from the record that the adequacy of the interpreter was

challenged by plaintiff’s counsel.”

Grant v. Fadhel, 51 Misc 3d 1009 (Sup.Ct. Kings Co. 2016)(Rivera, J.) – Defendant

attached copies of his and plaintiff’s deposition transcripts to his motion for summary

judgment. Neither had been signed or certified by the court reporter. Since defendant

failed to demonstrate that the transcript of plaintiff’s deposition had been submitted to

plaintiff for signature, that transcript was inadmissible. Similarly, inasmuch as his own

transcript was not certified, it is “not rendered admissible pursuant to CPLR 3116(a)

because it is his own.”

PRODUCTION OF DOCUMENTS

Matter of Aidin V., N.Y.L.J., 1202763864016 (Fam.Ct. Suffolk Co. 2016)(Hoffmann, J.)

– In this child neglect proceeding, respondent sought document production from Suffolk

County. The County’s policy is to respond to document requests “via compact disc.”

This, the Court finds, “poses an undue burden upon the respondent’s attorney who lacks

the technological capacity to utilize such an antiquated device.” Accordingly, the Court

directs that, until the technological capacities of the County “mirror those of the federal

courts which have successfully implemented electronic information sharing in a system

that is regularly maintained and easily accessible to all computer users,” the County

provide discovery “in paper format or by any other means acceptable to the respondent.”

McMahon v. New York Organ Donor Network, Inc., 52 Misc 3d 201 (Sup.Ct. N.Y.Co.

2016)(Bluth, J.) – “In whistleblower actions, it is often difficult to ascertain an

employer’s motivation for terminating or taking other personnel action against an


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employee. Personnel records of employees in similar positions may serve as a useful

comparison with a plaintiff’s personnel file. ‘The use of comparison evidence allows a

plaintiff to discover an employer’s intent and test the proffered reason for taking the

adverse employment action’ [citation omitted]. Comparison ‘evidence may be relevant to

the issue of intent in a case such as the instant one where plaintiff is attempting to show

that she was discharged from employment because of her whistle blowing activities’

[citation omitted]. Reviewing the performance evaluations of other employees could

allow a plaintiff to show that the employer’s stated reasons for a plaintiff’s termination

were baseless or a pretext. Plaintiff’s personnel requests are reasonable. Although

defendant provided plaintiff with information relating to probationary employees who

were terminated or resigned, plaintiff’s personnel requests relating to employees who

were not discharged are also reasonable. Comparing plaintiff’s performance evaluations

with those of other transplant coordinators, both terminated and retained, might allow

plaintiff to show that other probationary employees with similar performance evaluations

were not terminated, thereby countering defendant’s claim that plaintiff was discharged

for poor performance” [emphasis by the Court].

Berkowitz v. 29 Woodmere Blvd. Owners’, Inc., 135 A D 3d 798 (2d Dept. 2016) –

“Where discovery demands are overbroad, the appropriate remedy is to vacate the entire

demand rather than to prune it.”

Stepping Stones Associates, L.P. v. Scialdone, 148 A D 3d 855 (2d Dept. 2017) – “Many

of the 266 requests made in the defendants’ first demands for discovery were of an

overbroad and burdensome nature, and were palpably improper. Under these

circumstances, ‘the appropriate remedy is to vacate the entire demand rather than to

prune it’ [citations omitted]. Therefore, even though some of the defendants’ requests

may have sought relevant information, the Supreme Court providently exercised its

discretion in granting the branch of the plaintiffs’ cross motion which was to strike, in

their entirety, the defendants’ first demands for discovery and denying that branch of the

defendants’ motion which was to compel the plaintiffs to respond to those demands.”

Jordan v. City of New York, 137 A D 3d 1084 (2d Dept. 2016) – “The defendants’ failure

to timely challenge the plaintiff’s demand foreclosed inquiry into the propriety of the

information sought except with regard to his requests that sought privileged information,

or as to requests which were palpably improper.” Requests may be “palpably improper”

when “they seek irrelevant information, are overbroad and burdensome [citations

omitted], or fail to specify with reasonable particularity many of the documents

demanded.”

Hackshaw v. Mercy Medical Center, 139 A D 3d 798 (2d Dept. 2016) – “The Supreme

Court was not barred from entertaining Mercy’s objections to the disclosure of the

training materials for the years 2010 and 2013 because Mercy failed to assert them within


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the time prescribed by CPLR 3122, as Mercy contended that the plaintiffs’ demands for

such materials sought information that was immaterial to their claims and, therefore, were

palpably improper.”

DISCLOSURE OF SOCIAL MEDIA

D’Alessandro v. Nassau Health Care Corporation, 137 A D 3d 1195 (2d Dept. 2016) –

Last year’s “Update” reported on Forman v. Henkin, 134 A D 3d 529 (1st Dept. 2015), in

which the Appellate Division, First Department, narrowly-divided over the issue of the

burden upon the party seeking discovery of otherwise private pages of social media. The

majority held, consistent with its prior decisions dealing with both documentary and

electronic discovery, that “it is incumbent on the party seeking disclosure to demonstrate

that the method of discovery sought will result in the disclosure of relevant evidence or is

reasonably calculated to lead to the discovery of information bearing on the claims,” and

“discovery demands are improper if they are based upon ‘hypothetical speculations

calculated to justify a fishing expedition.’” Thus, “we disagree with the dissent’s

position that we should reconsider the well-settled body of case law, from both this Court

and other Departments, governing the disclosure of social media information.” For,

“although we agree with the dissent that social media is constantly evolving, there is no

reason to alter the existing legal framework simply because the potential exists that new

social network practices may surface. Furthermore, there is no dispute that the features

of Facebook at issue here (i.e., the ability to post photographs and send messages) have

been around for many years. Contrary to the dissent’s view, this Court’s prior decisions

do not stand for the proposition that different discovery rules exist for social media

information. The discovery standard we have applied in the social media context is the

same as in all other situations – a party must be able to demonstrate that the information

sought is likely to result in the disclosure of relevant information bearing on the claims

[citations omitted]. This threshold factual predicate, or ‘reasoned basis’ in the words of

the dissent, stands as a check against parties conducting ‘fishing expeditions’ based on

mere speculation.” And, “the question of whether a court should conduct an in camera

review of social media information is not presented on this appeal. The court below did

not order an in camera review, nor do the parties on appeal request any such relief.

Further, the dissent is mistaken that our prior decisions in this area require a court to

conduct an in camera review in all circumstances where a sufficient factual predicate is

established. The decision whether to order an in camera review rests in the sound

discretion of the trial court, or in this Court’s discretion if we choose to exercise it.” The

dissenting Justices argued that the case law in this area was too recent to be considered

well-settled, and should be revisited. They argued that demands for discovery of social

media should be treated the same as other discovery demands, where, “assuming that the

demand is sufficiently tailored to the issues, and unless a claim of privilege is made,

normally the plaintiff must then search through those items to locate any items that meet

the demand, and provide those items. There is not usually a need for the trial court to sift


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through the contents of the plaintiff’s filing cabinets to determine which documents are

relevant to the issues raised in the litigation.” And, “there is no reason why the

traditional discovery process cannot be used equally well where a defendant wants

disclosure of information in digital form and under the plaintiff’s control, posted on a

social networking site. The demand, like any valid discovery demand, would have to be

limited to reasonably defined categories of items that are relevant to the issues raised.

Upon receipt of an appropriately tailored demand, a plaintiff’s obligation would be no

different than if the demand concerned hard copies of documents in filing cabinets. A

search would be conducted through those documents for responsive relevant documents,

and, barring legitimate privilege issues, such responsive documents would be turned

over; and if they could not be accessed, an authorization for them would be provided.”

Thus, urged the dissent, “as long as the item is relevant and responsive to an appropriate

discovery demand, it is discoverable. To the extent disclosure of contents of a social

media account could reveal embarrassing information, ‘that is the inevitable result of

alleging these sorts of injuries.’” Here, in D’Alessandro, the Second Department appears

to apply a more liberal threshold showing before permitting discovery of cellular phone

records. The Court reverses the denial of plaintiff’s motion for discovery of defendant-

driver’s cell phone records for the hour before and after the accident at issue. The

demand was “not premised on ‘bare allegations of relevancy’ [citation omitted]. Rather,

the plaintiff’s motion papers adequately demonstrated that the issue of whether the

defendant driver was using her cellular telephone at the time of the accident was relevant

to the plaintiff’s contention that the defendant driver was negligent in the operation of her

motor vehicle [citation omitted]. As such, the plaintiff’s request for the defendant

driver’s cellular telephone records was ‘reasonably calculated to lead to the discovery of

information bearing on the plaintiff’s claims’ [citation omitted], and this portion of the

plaintiff’s request for disclosure was ‘sufficiently related to the issues in litigation to

make the effort to obtain them in preparation for trial reasonable.’” The Court affirmed

Supreme Court’s denial of access to the cell phone records of the non-party husband of

defendant driver.

SURVEILLANCE VIDEOS

Koksal v. The City of New York, 55 Misc 3d 836 (Sup.Ct. N.Y.Co. 2017) (Bluth, J.) –

Plaintiff’s application to preclude defendant’s use of videos taken of plaintiff “walking

within New York County Civil Court” is granted. Rule 29.1(a) of the Rules of the Chief

Judge provides that “taking photographs, films or videotapes, or audiotaping,

broadcasting or telecasting, in a courthouse, including any courtroom, office or hallway

therefor, at any time or on any occasion, whether or not the court is in session, is

forbidden, unless permission of the Chief Administrator is first obtained.” Here, “the

City insists that the videos were taken by a private investigator and that one of the videos

shows plaintiff running down the steps of a stairwell in 111 Centre Street.” The Court

rejects defendant’s argument that, since the Rule does not provide a penalty for its


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violation, preclusion is inappropriate. For, “what purpose would the rules of the Chief

Judge serve if a violation did not have a consequence? It would not be equitable for a

party to simply ignore a rule that does not contain a penalty and use evidence obtained by

breaking a rule to the detriment of the other party.” And, “the appropriate consequence

under these circumstances is to preclude defendants from gaining an advantage through

improper means and preventing defendants from using the portions of the video at trial

that depict plaintiff inside 111 Centre Street.”

SPOLIATION

Arbor Realty Funding, LLC v. Herrick, Feinstein LLP, 140 A D 3d 607 (1st Dept. 2016)

– “It is undisputed that Arbor’s obligation to preserve evidence arose at least as early as

June 2008, when Arbor retained counsel in connection with its claims against Herrick.

However, Arbor did not issue a formal litigation hold until May 2010. As a consequence,

Arbor’s internal electronic record destruction policies, including recycling of backup

tapes, deletion of employees’ emails stored in their inboxes or sent items folders for 189

days, and erasure of employee hard drives and email accounts upon the employee’s

departure from the firm, were not suspended until May 2010. In addition, Arbor’s CEO

deleted his emails on a regular basis between June 2007 and June 2010, with the result

that only one of his emails from the relevant period was produced. Arbor produced no

emails from the relevant period from its Executive Vice President of Structured Finance,

who was involved in the transaction.” Supreme Court found this failure to be ordinary

negligence, and directed that defendant would be entitled to an adverse inference charge

at trial. Now, it has been discovered that an additional eight employees of plaintiff were

involved in the transaction at issue, as the result of the late disclosure of minutes from a

committee meeting held during the relevant time period. Defendant renewed its motion

to dismiss the complaint on spoliation grounds. The Appellate Division reverses the

granting of that motion. “Generally, dismissal of the complaint is warranted only where

the spoliated evidence constitutes ‘the sole means’ by which the defendant can establish

its defense [citation omitted], or where the defense was otherwise ‘fatally compromised’

[citation omitted] or defendant is rendered ‘prejudicially bereft’ of its ability to defend as

a result of the spoliation [citation omitted]. The record upon renewal does not support

such a finding, given the massive document production and the key witnesses that are

available to testify, including the eight additional persons identified in the minutes, on

whom Herrick had not yet served interrogatories or deposition notices at the time it filed

its renewal motion. Accordingly, an adverse inference charge is an appropriate sanction

under the circumstances [citations omitted], since it will permit the jury to (1) find that

the missing emails and other electronic records would not have supported Arbor’s

position, and would not have contradicted evidence offered by Herrick, and (2) draw the

strongest inference against Arbor.” In addition, “plaintiff shall be required to pay

discovery sanctions of $10,000 to defendant Herrick, Feinstein, LLP for its failure to


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produce the loan committee meeting minutes until after the motion court had decided the

initial spoliation motion.”

Cioffi v. S.M. Foods, Inc., 142 A D 3d 520 (2d Dept. 2016) – “The record supports the

Supreme Court’s conclusion that, at the time the Atlanta defendants destroyed the

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 [citations

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.”

Macias v. ASAL Realty, LLC, 148 A D 3d 622 (1st Dept. 2017) – “The motion court

exercised its discretion in a provident manner in ordering the lesser sanction of an

adverse inference charge. Defendant’s principal testified that the building superintendent

regularly viewed the lobby surveillance tapes, and the superintendent admitted knowing

that the video automatically erased itself approximately every two weeks. This

knowledge, coupled with the superintendent being at the scene of plaintiff’s fall in

defendant’s building immediately after it occurred, was a sufficient showing that

defendant’s destruction of the evidence was, at a minimum, negligent.”

Rokach v. Taback, 148 A D 3d 1195 (2d Dept. 2017) – Defendant’s principal “viewed a

surveillance video recording shortly [after the accident at issue] which allegedly revealed

that the plaintiff stood at the side of the vehicle as it back up and then sat down behind

the front tire, causing the vehicle to drive over her toes.” Although that principal “was

notified of an impending lawsuit by the plaintiff only two days after the incident, the

defendants took no steps to preserve the video recording, and it subsequently was

erased.” The Court concluded that “the plaintiff sustained her burden of establishing that

spoliation occurred, given that the defendants failed to preserve the surveillance video

despite their knowledge of a reasonable likelihood of litigation regarding the incident,

and the highly relevant nature of the video evidence to that litigation [citations omitted].

However, since the destruction of the evidence did not deprive the plaintiff of her ability

to prove her claim so as to warrant the drastic sanction of striking the defendants’ answer,

the appropriate sanction for the spoliation herein is to preclude the defendants from

offering any evidence in this action regarding the alleged contents of the erased

surveillance video.”


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Fischetti v. Savino’s Hideaway, Inc., N.Y.L.J., 1202791284026 (Sup.Ct. Suffolk Co.

2017)(Ford, J.) – One of defendant restaurant’s employees – and son of the owners – who

had been involved in the installation of a surveillance camera system, was present in the

restaurant at the time of plaintiff’s accident. He did not, however, review the video of the

accident. The system automatically erases footage after two weeks, and the ordinary

protocol is “to view the footage on an ad hoc basis, responding to allegations of theft or

vandalism.” Several months after the accident, plaintiff commenced this action, and her

counsel “sent a form demand letter” which did not request preservation of any evidence.

Plaintiff’s motion for spoliation sanctions is denied. “The Appellate Division has

recognized that a defendant who destroys documents in good faith and pursuant to

normal business practice should not be sanctioned unless the defendant is on notice that

the evidence might be needed for future litigation.” Here, “defendant was not on notice

of the reasonable possibility of future litigation so as to be under a duty to suspend its

regular 2 week video retention policy.”

Ferrara Bros. Building Materials Corp. v. FMC Construction LLC, 54 Misc 3d 529

(Sup.Ct. Queens Co. 2016)(Dufficy, J.) – In its defense to plaintiff’s claim that it

interfered with its contract with a third party, defendant asserted – and provided

documentary evidence – that its own contract with that third party pre-dated plaintiff’s.

Plaintiff claims that the produced document is backdated. Now, seven years into the

litigation, plaintiff seeks the “metadata” behind the document, to demonstrate when it

was created. Defendant responded that the metadata no longer exists because, at some

point during the litigation, it scrapped its computers for a new system. “The computer

was discarded during pending litigation, at a time when the defendant knew or should

have known, even absent a specific demand by the plaintiff, that the creation and

modification of the contract, via the defendant’s computer system, would bear upon the

parties’ dispute.” And, the delay in demanding the metadata does not constitute a waiver

of the right to it. Thus, here, “while the plaintiff is not entirely foreclosed from proving

its case based upon testimonial evidence, the opportunity to include a forensic analysis of

the metadata to demonstrate potentially that the defendant’s contract was created at a

time when it had notice of the plaintiff’s contract with the property developer is negated

by the destruction of the computer [citation omitted]. The plaintiff is not required to

accept that defendants’ assurances that the metadata would not add to its proof at trial.”

The Court concluded that a negative inference charge to the jury was the appropriate

sanction.

Doviak v. Finkelstein & Partners, LLP, 137 A D 3d 843 (2d Dept. 2016) – In this legal

malpractice action, plaintiffs allege that defendants, representing them in a personal

injury action, failed to convey a settlement offer that they would have accepted – and

which was substantially larger than the ultimate jury verdict. Defendants contend that

they in fact conveyed the offer, by handing the offering document to plaintiff wife, which

she handed back to defendant with her rejection. “During Mrs. Doviak’s deposition in


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this action, the defendants’ counsel handed her the original offer document. The

plaintiffs subsequently moved to impose sanctions on the defendants on the ground that

the defendants had failed to preserve the offer document for fingerprint analysis and had

made such analysis impossible.” The Court holds that “the record supports the Supreme

Court’s conclusion that the plaintiffs failed to demonstrate that the defendants

intentionally or negligently destroyed fingerprint evidence which was critical to their

case. The plaintiffs failed to demonstrate that they requested that the offer document be

tested for fingerprints, or that it be preserved for forensic testing prior to Mrs. Doviak’s

deposition, or otherwise informed the defendants of their desire to conduct fingerprint

analysis. The plaintiffs’ boilerplate demand during discovery that they be permitted to

examine original documents on request does not satisfy this requirement, nor is it

reasonable to contend that the defendants should have anticipated the plaintiffs’ desire for

forensic testing of the offer documents.” In any event, “the plaintiffs failed to

demonstrate that, by failing to preserve the offer document for forensic testing, the

defendants had fatally compromised the plaintiffs’ ability to prove their claims [citations

omitted]. Therefore, the court providently exercised its discretion in denying the

plaintiffs’ motion for sanctions for spoliation.”

Golan v. North Shore-Long Island Jewish Health System, Inc., 147 A D 3d 1031 (2d

Dept. 2017) – “A day after the decedent underwent quadruple vessel coronary artery

bypass grafting performed by [defendant] Manetta, a cardiothoracic surgeon, the

decedent experienced an acute onset of massive bleeding. Thereafter, during a second

operation to resuscitate the decedent and repair the anastomosis, Manetta observed that a

stitch had broken at the base of the knot. The stitch was discarded during the second

operation and was not sent to any laboratory for analysis. The plaintiff moved to impose

sanctions against the defendants based on spoliation of evidence, contending that the

destruction of the broken suture deprived her of vital evidence necessary to respond to

any defense claim that a defective suture or other force was the cause of the failed

anastomosis and not a departure from good medical and surgical care. In response to the

plaintiff’s motion, the defendants submitted the affirmation of a medical expert, who

opined that the defendants did not depart from the standard of care by discarding the

broken suture and that preservation of the broken suture was immaterial to determining

the cause of the failed anastomosis. Under the circumstances presented, the Supreme

Court improvidently exercised its discretion in granting the plaintiff’s motion to impose

sanctions against the defendants for the willful spoliation and destruction of evidence, as

the plaintiff failed to demonstrate that the defendants were obligated to preserve the

broken suture at the time of its destruction, that the suture was destroyed with a ‘culpable

state of mind,’ and/or that the destroyed suture was relevant to the plaintiff’s claim

[citation omitted]. In any event, the plaintiff failed to establish that the defendants were

on notice that the suture might be needed for future litigation.”


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Atiles v. Golub Corporation, 141 A D 3d 1055 (3d Dept. 2016) – Plaintiffs seek sanctions

against defendants for failure to produce video surveillance footage of the accident scene

for the two hours following the accident. “Plaintiffs failed to establish a prima facie case

for entitlement to sanctions. Although it is uncontested that defendants are not in

possession of any video of the scene of the accident for the full two-hour period after the

accident, plaintiffs failed to put forth any evidence establishing why the video was not

preserved. More specifically, the record contains no evidence related to the maintenance,

or lack thereof, of any video related to the security cameras and explanation for how the

disputed video came to be lost or destroyed. Therefore, plaintiffs failed to prove that

defendants intentionally or willfully destroyed the video while under obligation to

preserve it [citation omitted]. Accordingly, and regardless of whether plaintiffs proved

some lesser culpable mental state, they retained the burden of proving the relevancy of

the portion of the video that they did not receive.” Plaintiffs failed to establish relevancy.

Kleinberg v. 516 West 19th LLC, 138 A D 3d 549 (1st Dept. 2016) – “In light of the

record of water penetrating into plaintiffs’ units for many months and the issuance by the

Department of Buildings of violations and directives to repair the roof, the removal and

replacement of the roof does not constitute spoliation, because it ‘was not done in bad

faith to harm [third-party defendant] KNS’s litigation posture, but rather for purposes of

mitigation of damages.’”

Mahiques v. County of Niagara, 137 A D 3d 1649 (4th Dept. 2016) – The subject

accident, involving a video slot machine at a casino, occurred in December 2005.

Plaintiff commenced the action in 2007, naming a John Doe corporation as manufacturer

of the machine. In 2008, an amended complaint named defendant IGT as manufacturer.

In 2010, plaintiff requested that IGT maintain the condition of the machine, but did not

seek to examine it until 2011, at which time “IGT then informed plaintiffs that the

machine was one of several video slot machines that had been removed from the casino

in 2008 at the casino defendants’ request to create more open space in the casino, and that

the subject machine and approximately 140 other machines were scrapped in the normal

course of business in June 2008.” The Appellate Division modifies Supreme Court’s

order striking IGT’s answer. “We conclude that plaintiffs established that some sanction

is warranted because IGT negligently failed to preserve the machine, but plaintiff failed

to show that the destruction of the machine was intentional or contumacious, to warrant

the sanctions imposed by the court.” Plaintiffs “failed to establish that the machine was

destroyed before they had an opportunity to inspect it, and thus plaintiff failed to

establish that the extreme sanctions of striking IGT’s answer and granting plaintiffs

partial summary judgment on liability against IGT were warranted.” For “plaintiffs did

not request that the machine be preserved or attempt to view it in the two years after the

accident and prior to the commencement of the action [citations omitted], nor did they do

so in the ensuing year between when the action was commenced and the machine was

scrapped. Indeed, plaintiffs did not seek to examine the machine for an additional two


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years after IGT was joined as a defendant.” Nor did destruction of the machine “deprive

plaintiffs of the ability to establish their causes of action.” Accordingly, the Court

concluded that a negative inference charge was the appropriate sanction.

Scott v. Henny Penny Corporation, 54 Misc 3d 238 (Sup.Ct. Onondaga Co. 2015) –

Plaintiff was injured using a fryer manufactured by defendant. Shortly thereafter,

plaintiff retained counsel and counsel, with a professional engineer, tested the fryer.

During the testing, the fryer was damaged. And, thereafter, certain component parts

became missing. The then prospective defendant was not notified of the testing.

Defendant seeks spoliation sanctions. “Where a plaintiff negligently or intentionally

destroys or loses evidence prior to the commencement of an action, spoliation sanctions

are appropriate.” And, here, “it does not appear that plaintiff, through counsel, made any

good faith attempt to locate or preserve these component parts which were damaged

during the unnoticed inspection.” Accordingly, the appropriate sanction is “the

preclusion of any expert testimony regarding the defective nature of the subject fryer.”

Sarach v. M&T Bank Corporation, 140 A D 3d 1721 (4th Dept. 2016) – In response to

plaintiff’s application for pre-action disclosure, defendant “represented to Supreme Court

that it had voluntarily undertaken preservation of certain evidence,” and ultimately

consented to an “order of preservation.” Defendant later revealed that the materials had

not been preserved. A divided Appellate Division majority agrees with nisi prius that

defendant “wilfully failed to disclose information,” but concluded that “the court abused

its discretion in striking defendant’s answer.” Instead, since the lost evidence did not

deprive plaintiff of the ability to prove his case at trial, “we conclude that an appropriate

sanction is that an adverse inference charge be given at trial.” The dissenter found that

“willfulness” had not been “‘conclusively shown’ or established by a ‘clear showing,’ or

by ‘clear and convincing evidence,’” as prior precedent required. The dissent would have

imposed the sanction of preclusion rather than an adverse inference.

ELECTRONIC DISCLOSURE

Chan v. Cheung, 138 A D 3d 484 (1st Dept. 2016) – In recent years, the Appellate

Division, First Department, has decided a number of significant cases dealing with

Electronic Disclosure. In U.S. Bank, N.A. v. GreenPoint Mortgage Funding, Inc.,

94 A D 3d 58 (1st Dept. 2012), the Court held that “we are persuaded that Zubulake [v.

UBS Warburg LLC, 220 F.R.D. 212 (S.D.N.Y. 2003)] should be the rule in this

Department, requiring the producing party to bear the cost of production [of both ESI and

physical documents] to be modified by the IAS court in the exercise of its discretion on a

proper motion by the producing party.” For, “requiring the producing party to bear its

own cost of discovery, including the searching, retrieving and producing of ESI, supports

‘the strong public policy favoring resolving disputes on their merits’ [citing Zubulake].

The alternative of having the requestor pay ‘may ultimately deter the filing of potentially

meritorious claims’ particularly in circumstances where the requesting party is an


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individual.” Then, in Voom HD Holdings LLC v. EchoStar Satellite L.L.C., 93 A D 3d 33

(1st Dept. 2012), the Court concluded that “the Zubulake standard is harmonious with

New York precedent in the traditional discovery context, and provides litigants with

sufficient certainty as to the nature of their obligations in the electronic discovery context

and when those obligations are triggered.” Thus, “once a party reasonably anticipates

litigation, it must, at a minimum, institute an appropriate litigation hold to prevent the

routine destruction of electronic data [citation omitted]. Regardless of its nature, a hold

must direct appropriate employees to preserve all relevant records, electronic or

otherwise, and create a mechanism for collecting the preserved records so they might be

searched by someone other than the employee. The hold should, with as much specificity

as possible, describe the ESI at issue, direct that routine destruction policies such as auto-

delete functions and rewriting over e-mails cease, and describe the consequences for

failure to so preserve electronically stored evidence. In certain circumstances, like those

here, where a party is a large company, it is insufficient, in implementing such a litigation

hold, to vest total discretion in the employee to search and select what the employee

deems relevant without the guidance and supervision of counsel.” The Court rejected

defendant’s (and amicus’s) argument that “reasonably anticipates” is too vague, and that

no sanctions for destruction of electronically stored information should be imposed “in

the absence of pending litigation.” For, “to adopt a rule requiring actual litigation or

notice of a specific claim ignores the reality of how business relationships disintegrate.

Sides to a business dispute may appear, on the surface, to be attempting to work things

out, while preparing frantically for litigation behind the scenes. EchoStar and amicus’s

approach would encourage parties who actually anticipate litigation, but do not yet have

notice of a ‘specific claim’ to destroy their documents with impunity.” The Court

defined “reasonable anticipation of litigation” as “such time when a party is on notice of

a credible probability that it will become involved in litigation.” Most recently, last

year’s “Update” reported on the Court of Appeals decision in Pegasus Aviation I, Inc. v.

Varig Logistica S.A., 26 N Y 3d 543 (2015). There, Supreme Court granted plaintiff’s

motion for an adverse inference instruction at trial against defendants as a sanction for

spoliation of electronic evidence. A splintered Appellate Division reversed. The Court

unanimously agreed upon the standard – when the spoliation is intentional, or the result

of gross negligence, the adverse party need not demonstrate prejudice flowing from the

spoliation. But when the spoliation is merely negligent, the adverse party must show that

it has been harmed for sanctions to be awarded. The 3-Justice majority concluded that

defendant here was merely negligent, and that plaintiff failed to demonstrate prejudice.

“The motion court’s finding of gross negligence apparently was based on a statement by

a federal district court of the Southern District of New York that, when litigation is

anticipated, ‘the failure to issue a written litigation hold constitutes gross negligence

because that failure is likely to result in the destruction of relevant information’ [citation

omitted (emphasis by the Court)]. To the extent the district court meant by this that

failure to institute a litigation hold, in all cases and under all circumstances, constitutes


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gross negligence per se, the statement has been disapproved by the Second Circuit

[citation omitted]. The per se rule apparently articulated in [the Southern District

decision], and followed by the motion court, has never to our knowledge been adopted by

a New York state appellate court.” One Justice agreed that only ordinary negligence had

been shown, “however, because a court may, in its discretion, impose a spoliation

sanction for the negligent destruction of evidence, I disagree with the majority’s

conclusion that no sanction is warranted, and would remand for a determination as to the

extent to which plaintiffs have been prejudiced by the loss of the evidence, and the

sanction, if any, that should be imposed.” Another Justice dissented entirely, finding that

defendant’s “failure to take any meaningful steps to preserve evidence constitutes gross

negligence and therefore that the order imposing the sanction of an adverse inference

should be affirmed.” A divided Court of Appeals reversed. The majority agreed with the

Appellate Division majority that defendant was merely negligent in its spoliation of

evidence, and that when “evidence is determined to have been negligently destroyed, the

party seeking spoliation sanctions must establish that the destroyed documents were

relevant to the party’s claim or defense.” The Court found, however, that the Appellate

Division majority erred in failing to consider plaintiff’s evidence as to the relevance of

the destroyed material. And, “although the Appellate Division possesses the authority to

make findings of fact that are as broad as the trial court, in this instance, where it all but

ignored Pegasus’s arguments concerning the relevance of the documents, we conclude

that the prudent course of action is to remit the matter to Supreme Court for a

determination as to whether the negligently destroyed ESI was relevant to Pegasus’s

claims against the MP defendants and, if so, what sanction, if any, is warranted.” The

Court also disagreed with the Appellate Division majority that “a trial adverse inference

charge in an alter ego case such as this one would be ‘tantamount to granting Pegasus

summary judgment’ [citation omitted]. Such adverse inference charges have been found

to be appropriate even in situations where the evidence has been found to have been

negligently destroyed.” The dissenters in the Court of Appeals “part ways with the

majority over its determination that the MP defendants’ ‘culpable state of mind’

amounted to, at most, simple negligence.” They concluded that defendants were grossly

negligent. And, the dissenters “further disagree with the majority’s view that relevance is

not to be presumed because the evidence was not intentionally or wilfully destroyed.”

For, “‘destruction that is the result of gross negligence’ also ‘is sufficient to presume

relevance.’” The dissenters thus “would remit to the Appellate Division for consideration

of whether, in its discretion, a sanction is warranted.” Here, in Chan, a defamation

action, plaintiffs allege that defendant published a defamatory affidavit via e-mail.

“Upon receipt of correspondence, dated July 13, 2009, threatening litigation, and

certainly upon service of the complaint herein, defendant should have placed a litigation

hold on relevant electronic data in order to preserve it.” Instead, the Court found,

defendant intentionally destroyed all potentially relevant e-mails. Thus, “it is impossible

to determine the universe of recipients of the subject affidavit, and thus to determine the


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extent of damage to plaintiffs.” This conduct “warrants the sanction of striking her

pleadings.”

Gilbert v. Highland Hospital, 52 Misc 3d 555 (Sup.Ct. Monroe Co. 2016)(Doyle, J.) – In

this medical malpractice case, plaintiff claims that defendant hospital released plaintiff’s

deceased from its emergency room without her condition being evaluated by a physician.

Plaintiff seeks disclosure of the “audit trail” of the deceased’s medical records. The audit

trail is essentially metadata, which indicates, inter alia, when the records were accessed,

by who, and for how long a period. The Court concludes that, on these facts, the audit

trail is discoverable. While “system metadata” is generally not subject to disclosure,

here, “the plaintiff’s request is relevant to the allegations made in the complaint;

specifically, the allegation that the decedent was not seen or evaluated by a medical

doctor, prior to discharge.”

Matter of Nunz, 53 Misc 3d 483 (Surr.Ct. Erie Co. 2016)(Howe, J.) – In this estate

dispute, discovery is sought of the hard-drive of the computer of the attorney who drafted

the will, and then “deleted” the file relating to it. The Court finds that the discovery is

appropriate, but “given the potential harm in the forensic examination process, I am not

prepared to allow any e-discovery request predicated on the assertion that counsel ‘has a

guy who thinks he can restore the hard drive and retrieve almost all of it’ [emphasis by

the Court]. Similarly, I am not prepared to allow indiscriminate access to an attorney’s

computer where there may be attorney-client privilege issues involved, or unrelated

confidential information on it, based on the mere assertion by Morse that ‘his computer

tech guy can operate under a non-disclosure order.’ These are sensitive issues, and they

need to be carefully explored and resolved first before any forensic examination of the

computer is permitted” [emphasis by the Court]. The Court accordingly directed the

proponent of the discovery to submit an affidavit from his expert, detailing: “(1) the

expert’s name, address, qualifications and credentials; (2) the expert’s opinion regarding

the ability to retrieve the relevant ESI from Perla’s computer, including, if being sought,

what type of metadata is at issue * * *; (3) how long the process of ESI discovery and

examination of Perla’s computer would take to complete, whether it can be done at

Perla’s office, or whether some other approach or place is either necessary or desirable;

(4) what exactly the expert would need to accomplish the data retrieval; and (5) how the

expert proposes to identify and protect ESI on Perla’s computer which may be subject to

the attorney-client privilege or to other confidentiality considerations; (6) What the expert

proposes with respect to the considerations set out in the Commercial Division, Nassau

County Guidelines for Discovery of Electronically Stored Information (ESI), section C,

items 3, 5, 6, 8, 9, 11, 13 and 15 (available online at

www.nycourts.gov/courts/comdiv/PDFs/Nassau-E-Filing-Guidelines.pdf)” [emphasis by

the Court].

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Iris Mediaworks, Ltd. v. Vasisht, N.Y.L.J., 1202791048431 (Sup.Ct. N.Y.Co. 2017)

(Chan, J.) – The forensic evidence demonstrated that, at the beginning of this litigation,

defendant hacked plaintiffs’ computer system, causing its e-mails – including e-mails to

and from their counsel – to be automatically forwarded to an address that then

automatically forwarded them to defendant. “The hacking of plaintiffs’ email during

litigation can only be seen as an attempt to undermine plaintiffs’ case. It is also

indicative of Vasisht’s disregard for the judicial process. While striking a defendant’s

answer is an extreme sanction, it is warranted here as hacking plaintiffs’ email to obtain

information during litigation without going through proper discovery channels is an

egregious act and sidesteps discovery procedures.”

MEDICAL RECORDS AND EXAMINATIONS

Barber v. Franzon, N.Y.L.J., 1202773234294 (Sup.Ct. Clinton Co. 2016)(Muller, J.) –

“‘A plaintiff mother does not waive her physician-patient privilege with respect to her

own medical history, other than for that period when the infant was in utero, merely by

acting in a representative capacity in an action in which the infant is the real party in

interest [citations omitted]. In such cases, the mother will be deemed to have waived her

privilege when, by her conduct, such as by answering questions relating to her medical

history during an examination before trial, she has affirmatively placed her own medical

history into issue [citation omitted]. Even then, however, disclosure is limited to records

covering the period when the infant was in utero, unless evidence is presented that the

mother’s medical history covering other periods is relevant.’”

Greco v. Wellington Leasing Limited Partnership, 144 A D 3d 981 (2d Dept. 2016) –

“Because the plaintiff affirmatively placed her entire medical condition in controversy

through broad allegations of physical injuries and claimed loss of enjoyment of life due to

those injuries, which included impairment of her nervous system and requirement of

neurological care, the nature and severity of her previous psychiatric conditions and her

history of treatment for substance abuse are matters material and necessary to the issue of

damages [citations omitted]. However, the Supreme Court properly denied that branch of

the defendants’ motion which was to compel the production of records pertaining to the

plaintiff’s child custody status and child support payments, as they failed to establish that

such records contained information that was material and necessary in the prosecution or

defense of this action.”

Cianciullo-Birch v. Champlain Centre North LLC, N.Y.L.J., 1202760199252 (Sup.Ct.

Clinton Co. 2016)(Muller, J.) – “A claim for loss of enjoyment of life is not a separate

element of damages, but rather ‘a factor to be considered by the jury in assessing

damages for conscious pain and suffering’ [citation omitted], by weighing ‘the frustration

and anguish caused by the inability to participate in activities that once brought pleasure’

[citation omitted]. The question thus framed is whether plaintiff has waived the

physician patient privilege concerning her entire medical history – but particularly


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records pertaining to her mental health – by having alleged a loss of enjoyment of life.”

The Appellate Divisions “have not at all been uniform in their dissection of this issue.”

But, “this level of disclosure is more consistently favored than not, and this Court

therefore finds the mental health records sought are ‘material and necessary’ and likely to

‘assist preparation for trial by sharpening the issues.’” However, the Court limits the

period for which records must be produced, beginning with the “date testified to by the

plaintiff as a time of onset of her depression.”

Josphe v. Dermatology Associates of Rochester, P.C., 52 Misc 3d 528 (Sup.Ct. Monroe

Co. 2016)(Rosenbaum, J.) – Plaintiff claims that defendants’ malpractice caused

permanent scarring to her arm, resulting, inter alia, in “psychological damages and loss

of enjoyment of life.” Defendants seek “virtually all medical records from any

encounters with medical professionals over the last 20 years.” A plaintiff’s mental health

records are discoverable “where ‘her broad allegations of injury, including her alleged

limited ability to perform normal daily functions and social activities, as well as her

alleged “inability and limited ability to engage in life’s enjoyments and loss of

employment and career,” could have resulted from physical injuries sustained in the

accident, her preexisting mental condition or some combination thereof.’” Thus, the

records are, here, relevant. “However, the court is cognizant that the alleged injuries,

regardless of their significance, do not warrant a carte blanche, wholesale entitlement to

all of plaintiff’s medical records from the beginning of time. Defendants’ request for

plaintiff’s primary care records, including those almost a quarter of a century old, is

overly broad, burdensome and unlikely to lead to relevant evidence.” The Court noted

that the usual judicial response to such competing interests is “an in camera submission.”

But, “an in camera review of every file could become a monumental task. In an attempt

to creatively deal with the potential judicial backlog if these issues arise more frequently,

and to preserve judicial resources, while protecting the competing rights of the parties, a

streamlined process could reasonably resolve the competing interests and goals. In

following the guidance bestowed by the Appellate Division, regarding which cases

require an in camera review, this court implements the following process, subject to any

comments which the parties believe may be of assistance. The objected to pretreatment

(injury) records including those requested from the area hospitals shall be submitted to

the court for an in camera review. However, to assist in the process, plaintiff’s counsel

shall request a copy of the records, review them and determine which particular records

or entries they object to being disclosed. Counsel shall draft a privilege log describing

the contents of the records, their objection to the release and the legal basis thereof. In

this particular matter, the court would limit the discovery to five years prior to the alleged

negligence, but if defendants find materials in those records which would warrant further

discovery, an application can be made thereon if the parties cannot agree otherwise.”

James v. 1620 Westchester Avenue LLC, 147 A D 3d 575 (1st Dept. 2017) – A closely-

divided Appellate Division holds that “defendants did not meet their burden of showing a


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‘compelling need’ for medical records concerning HIV; they failed to submit evidence

that would establish a connection between plaintiff’s claimed HIV status and her future

enjoyment of life [citations omitted]. Similarly, defendants failed to meet their burden of

showing that ‘the interests of justice significantly outweigh the need for confidentiality’

such to permit discovery of mental health, alcohol abuse, or substance abuse records.”

For, “plaintiff’s alleged general anxiety and mental anguish from back and leg injuries do

not place her entire mental and physical health into contention.” The dissenters argued

that “plaintiff’s injuries were allegedly caused by a trip and fall on a hazardous condition

on defendant’s property, but more than just plaintiff’s physical condition is in issue; she

also alleges anxiety and mental anguish, and seeks an award of future pain and suffering,

which may incorporate a calculation of life expectancy or an assessment of enjoyment of

life.” Records “regarding any treatment plaintiff recently received for her mental health

or for alcohol or substance abuse are sufficiently relevant to satisfy the material and

necessary standard of CPLR 3101, and by putting her emotional or psychological

condition in controversy plaintiff has waived any protection applicable to such records.”

The dissent also noted that, “it may bear repeating that the discoverability of such records

does not mean they are necessarily admissible at trial.”

McMahon v. New York Organ Donor Network, Inc., 56 Misc 3d 467 (Sup.Ct. N.Y.Co.

2017)(Bluth, J.) – “The instant motion appears to raise an issue of first impression –

whether an O[rgan] P[rocurement] O[rganization] that is not covered by HIPAA must

produce medical records it obtained from a covered entity because this information is

required in order to run its organization. The reason that defendant receives medical

records is that it needs the information to process organ donations. Defendant must know

certain information about a donor’s medical history in order to ensure that a donation is

successful. However, defendant is not a covered entity and, therefore, must turn over the

requested information. Defendant failed to identify a federal regulation or case law that

would prevent this court from requiring disclosure.”

Colindres v. Carpenito, 55 Misc 3d 856 (Sup.Ct. Westchester Co. 2017)(Lefkowitz, J.) –

“Section 202.17(b)(1) of the Uniform Rules for Trial Courts (22 NYCRR) obligates a

party, who has been served with a notice for a physical examination, to provide, at least

20 days prior to the examination or other date directed by the court, reports from their

treating and examining medical providers, which shall (1) include a recital of injuries and

conditions as to which testimony will be offered at trial, and (2) set forth a description of

the injuries, a diagnosis and a prognosis. Contrary to plaintiff’s contention, the rule does

not apply ‘predominantly’ to toxic tort actions, but instead applies to all personal injury

and wrongful death actions as noted in the title of the rule, to wit, ‘Exchange of medical

reports in personal injury and wrongful death actions.’ It is undisputed that plaintiff

failed to provide a report from her treating psychologist, Ms. Henry, either prior to or

subsequent to her IME by defendants’ designated psychologist. The fact that a treating or

examining medical provider, such as here, has not drafted a report does not obviate a


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plaintiff’s obligation to provide such a report under the rules.” Moreover, “contrary to

plaintiff’s contention, the fact that defendants conducted plaintiff’s psychological IME

without first receiving a report from plaintiff’s treating psychologist did not waive

defendants’ entitlement to a medical report from plaintiff’s treating psychologist. Unlike

other items of discovery which must be affirmatively sought be a party, the exchange of

medical reports in a personal injury action, including reports of a plaintiff’s treating

medical providers, is required, without demand, by section 202.17 of the Uniform Rules

for Trial Courts (22 NYCRR). With respect to the reports of a plaintiff’s treating medical

providers, a plaintiff’s obligation under the rule to exchange such reports is triggered

when plaintiff is served with a notice fixing the time and place of a physical

examination.” The Court directed prompt exchange of a report by the treating

psychologist.

Kaous v. Lutheran Medical Center, 138 A D 3d 1065 (2d Dept. 2016) – This medical

malpractice action challenges the defendants’ conduct during the birth of the infant

plaintiff, Sophia. “The Supreme Court properly determined that the defendants were

entitled to perform genetic testing and a physical examination of Sophia. In a medical

malpractice action, where the physical condition of a party is in controversy, ‘any party

may serve notice on another party to submit to a physical, mental or blood examination

by a designated physician’ [citation omitted]. Here, the defendants challenge the

plaintiffs’ allegation that Sophia’s injuries were caused by the defendants’ purported

malpractice and not Fraser Syndrome or any other genetic predisposition. Given that

Sophia’s physical and mental condition is in dispute, the Supreme Court properly granted

those branches of the defendants’ motions which were to permit genetic testing and a

physical examination of Sophia [citation omitted]. In addition, the Supreme Court

properly granted those branches of the defendants’ motions which were for authorizations

for the medical records of Sophia’s siblings. CPLR 3101(a) provides for ‘full disclosure

of all matter material and necessary in the prosecution or defense of an action.’ The

terms ‘material’ and ‘necessary’ are liberally construed to further the disclosure ‘of any

facts bearing on the controversy which will assist preparation for trial by sharpening the

issues and reducing delay and prolixity’ [citations omitted]. Here, defendants

demonstrated that the siblings’ medical records are material and necessary by submitting

an expert affirmation explaining that these records would ensure that Sophia is properly

diagnosed and that the claimed injuries were not caused by any other genetic conditions

to which she was predisposed.”

Steinbok v. City of New York, N.Y.L.J., 1202769722634 (Sup.Ct. N.Y.Co. 2016)

(d’Auguste, J.) – The Court rejects a defendant’s attempt to limit to an attorney the

person who can accompany plaintiff to a medical examination. “A plaintiff is entitled to

have a non-attorney, colloquially known as an IME watchdog, present at an independent

medical examination.” Defendant’s proposed limitation “has been raised in multiple

prior litigations and has been specifically rejected by the Appellate Division, First


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Department in Guerra v. McBean, 127 A D 3d 462 (1st Dept. 2015).” Indeed, these very

attorneys lost that case. Thus, “it is apparent to this Court that Baker McEvoy knew that

its argument regarding the presence of a non-attorney at an IME was meritless because it

had been raised in the Guerra litigation and rejected by the Appellate Division prior to

submitting the instant motion. Accordingly, the demand served by Baker McEvoy was a

legal nullity because it contained improper conditions.” Since that demand was a nullity,

and the time to make such a demand has now expired, the Court concludes that a medical

examination has been waived.

Henderson v. Ross, 147 A D 3d 915 (2d Dept. 2017) – The same defendant’s law firm as

in Steinbok, directly above, sought to similarly limit plaintiff to being accompanied by an

attorney. The limitation is here also rejected. “A plaintiff ‘is entitled to be examined in

the presence of his or her attorney or other legal representative, as well as an interpreter,

if necessary, so long as they do not interfere with the conduct of the examination

[citations omitted]. Here, the defendant failed to meet his burden of establishing that the

plaintiff’s representative would improperly interfere with the conduct of the injured

plaintiff’s physical examination.”

Vargas v. City of New York, 146 A D 3d 917 (2d Dept. 2017) – “While ‘a plaintiff will

normally be entitled to have his or her attorney present at an IME,’ ‘permission to employ

the additional measure of videotaping the examination will be granted only where the

plaintiff establishes the existence of special and unusual circumstances.” The Court cited

its decision in Bermejo v. New York City Health and Hospitals Corporation, 135 A D 3d

116 (2d Dept. 2015), reported on in last year’s “Update,” in which the Court held that, as

“appellate courts in other departments have recognized, there is no express statutory

authority for the videotaping of medical examinations, either in the discovery statute

authorizing physical examinations of parties [citation omitted] or in the court rule

governing such examinations [citations omitted]. Indeed, the Appellate Division, Third

Department, has commented that ‘authorization of videotaping was intentionally left out

of 22 NYCRR 202.17 and such intent should be accorded deference’ [citation omitted].

Requests for permission to videotape IMEs have been made on a case-by-case basis, and

‘videotaping has not been allowed in the absence of special and unusual circumstances.’”

Thus, the caselaw contemplates that “a plaintiff will normally be entitled to have his or

her attorney present at an IME, but that permission to employ the additional measure of

videotaping the examination will be granted only where the plaintiff establishes the

existence of special and unusual circumstances. The latter proposition presupposes that a

request for the court’s permission to engage in videotaping will be made. What the law

of this state does not contemplate is plaintiffs’ attorneys taking it upon themselves to

surreptitiously videotape an IME, without the knowledge of the examining physician,

without notice to the defendants’ counsel, and without seeking permission from the court.

Contrary to the assertions made by the plaintiff’s attorneys in Supreme Court,

surreptitious videotaping of IMEs, without court approval or even notice to the court or


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opposing counsel, cannot be regarded as an ‘appropriate tool’ or an activity that attorneys

should feel free to engage in ‘all the time.’” Thus, “the failure of plaintiff’s counsel to

seek and obtain the Supreme Court’s permission to videotape the second IME was, by

itself, a sufficient reason to prohibit the use of the recording at trial. Further

compounding the improper conduct of plaintiff’s counsel in making the recording

without procuring the court’s approval in advance was the failure to disclose the

recording to defense counsel prior to trial, which was a clear violation of CPLR 3101.”

The Bermejo Court directed a new IME, and sanctions against plaintiff’s counsel.

Hayes v. Bette & Cring, LLC, 135 A D 3d 1058 (3d Dept. 2016) – “While we previously

held that there is ‘no statutory authority to compel the examination of an adverse party by

a nonphysician vocational rehabilitation specialist’ (Mooney v. Osowiecky, 215 A D 2d

839, 839 [1995]), the Court of Appeals has since confirmed that the mandate for broad

disclosure is not necessarily limited by the more specific provision of the CPLR that

allows a defendant to demand that a plaintiff submit to a physical or mental examination

‘by a designated physician’ [citation omitted] where his or her medical condition is at

issue [citation omitted]. Accordingly, the circumstances of a case may allow such a

demand even in the absence of express statutory authority [citations omitted]. We agree

with the conclusion reached by the other Departments that such circumstances are not

limited to those cases where a plaintiff has retained a vocational rehabilitation expert to

establish damages, although, generally, such testing ‘might well be unduly burdensome’

[citations omitted]. We recognize that Supreme Court relied upon our prior decision in

Mooney [citation omitted] in denying the motion to compel, but the ruling in that case

should no longer be followed. Hayes placed his ability to work in controversy by

claiming that, as a result of his injuries, he suffered loss of future wages and reduced

earning capacity and by testifying at his examination before trial that his future career

opportunities were limited [citations omitted]. Further, at the time of the demand, Hayes

did not object or otherwise complain that he would be prejudiced or burdened by such

examination and no note of issue had been filed. In our view, therefore, Hayes should be

directed to appear before a vocational rehabilitation expert.”

ENFORCING DISCLOSURE ORDERS

Stewart v. Makhani, 146 A D 3d 703 (1st Dept. 2017) – “While delays in discovery are

frustrating, a trial court has the responsibility ‘to fashion an order consistent with its

obligation to bring discovery to an end as quickly as possible. Marking a case off or

striking a case during the discovery phase does not further that obligation because it only

encourages inaction by the parties and counsel in completing discovery. Ultimately,

marking a case off during discovery leads to unnecessary motion practice, loss of

valuable time for discovery, and a waste of judicial resources.’”

Luo v. Yang, 150 A D 3d 726 (2d Dept. 2017) – “‘A conditional order of preclusion

requires a party to provide certain discovery by a date certain, or fact the sanctions


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specified in the order’ [citations omitted]. Here, the so-ordered stipulation entered into

by the parties in this action functioned as a conditional order of preclusion, which became

absolute upon the defendant’s failure to comply with it [citations omitted], unless the

defendant demonstrated a reasonable excuse for failure to comply with its terms and the

existence of a potentially meritorious cause of action or defense [citations omitted]. The

defendant, who offered bare allegations of neglect by his prior counsel, failed to

demonstrate a reasonable excuse for his failure to comply with the so-ordered stipulation

[citations omitted]. Inasmuch as the defendant failed to demonstrate a reasonable excuse

for his failure to comply with the so-ordered stipulation, we need not consider whether he

offered a potentially meritorious cause of action or defense to the action.”

Viruet v. The Mount Sinai Medical Center, Inc., 143 A D 3d 558 (1st Dept. 2016) –

“Although plaintiff eventually, albeit belatedly, provided or addressed many of the

outstanding items listed in Supreme Court’s fifth and final order of discovery, she still

did not supplement the bill of particulars to articulate the basis for her malpractice claims

or demand for special damages, even though five years had passed since the

commencement of the action. She also failed to provide completed HIPAA authorization

forms. Nevertheless, ‘striking 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 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 [citations omitted]. We,

therefore, modify to reinstate the complaint, direct plaintiff within 45 days of this order to

pay a monetary sanction of $1,500, and afford plaintiff a final opportunity to supplement

her bill of particulars and to provide complete HIPAA authorizations.”

Crooke v. Bonofacio, 147 A D 3d 510 (1st Dept. 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


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are precisely tailored to the discovery abuse at issue [citation omitted], and find that the

court herein crafted an appropriate remedy.”

Arbor Realty Funding, LLC v. Herrick, Feinstein LLP, 145 A D 3d 624 (1st Dept. 2016)

– The Appellate Division modifies Supreme Court’s dismissal of the complaint.

“Although plaintiffs produced responsive material, it was imbedded in large amounts of

otherwise irrelevant documents. Over 30,000 documents were produced. The trial court

then gave plaintiffs ample time and opportunity to further produce the documents in an

electronically searchable format and to organize its responses in the form that defendant

requested them. Plaintiffs failed to comply with the court’s directions. Under these

circumstances, the trial court properly concluded that plaintiffs’ failure to comply with its

orders was willful [citation omitted]. Given, however, plaintiffs’ partial compliance and

the strong public policy in favor of disposing of cases on the merits, we find that

dismissal of the action is too severe a sanction at this time and that a less severe sanction,

of a monetary fine in the amount of $10,000 plus costs is appropriate, along with a final

30-day opportunity for plaintiffs to provide the discovery in the format ordered by the

trial court.”

Lucas v. Stam, 147 A D 3d 921 (2d Dept. 2017) – A divided Appellate Division reverses

Supreme Court’s order imposing a monetary sanction for defendants’ discovery failures,

and, instead, directs that their answers be stricken. Defendants’ counsel attempted to

excuse the misstatement that a surgical broker had left defendant hospital’s employ as

“an honest mistake.” Counsel also attempted to excuse its failure to provide the identity

of another surgical broker as “an oversight,” even though counsel had interviewed that

broker. Counsel also failed to comply with Court orders to provide certain forms, and to

submit an affidavit of compliance. “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.” And, “‘parties, where necessary,

will be held responsible for the failure of their lawyers to meet court-ordered deadlines

and provide meaningful responses to discovery demands.’” Ultimately, “in determining

the appropriate sanction to impose, we are guided by CPLR 3126, which permits courts

to, among other things, ‘order that the issues to which the information is relevant shall be

deemed resolved for purposes of the action in accordance with the claims of the party

obtaining the order’ (CPLR 3126[1]), issue a preclusion order (see, CPLR 3126[2]), or

strike a pleading (see, CPLR 3126[3]). 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


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[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

dissenter argued that Supreme Court did not abuse its discretion in limiting the

punishment to a monetary sanction. “‘Dismissal is a harsh penalty imposed on a client

for his or her lawyer’s failures’ [citations omitted], 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.”

Schiller v. Sunharbor Acquisition I, LLC, 152 A D 3d 612 (2d Dept. 2017) – “Almost

four years after she commenced the action, the plaintiff moved, inter alia, pursuant to

CPLR 3126 to strike the defendants’ answer on the ground that the defendants were

willful and contumacious in their failure to respond to the plaintiff’s repeated demands

for the decedent’s entire medical record and the Supreme Court’s orders related to the

same.” The Appellate Division affirms the granting of that motion. “The striking of a

pleading may be appropriate where there is a clear showing that the failure to comply

with discovery demands or court-ordered discovery is willful and contumacious [citations

omitted]. The willful and contumacious character of a party’s conduct can be inferred

from the party’s repeated failure to comply with discovery demands or orders without a

reasonable excuse.” Moreover, here, “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.”

McHugh v. City of New York, 150 A D 3d 561 (1st Dept. 2017) – “The City’s and the

MTA’s unexplained noncompliance with a series of court-ordered disclosure mandates

over a period of nearly three years constituted willful and contumacious behavior,

warranting the striking of their answer [citations omitted]. Defendants’ belated

production of ‘a witness’ for deposition on behalf of all three defendants failed to satisfy

the requirements of the July 2015 order, since the witness produced was unprepared and

had knowledge only on behalf of defendant Parsons. While the court thus providently

exercised its discretion in declining to sanction Parsons, the order on appeal directing the

City and the MTA yet again to produce a witness with knowledge was insufficient.

Given the City’s and the MTA’s prolonged and willful failure to provide a ‘timely

response and one that evinces a good-faith effort to address the requests meaningfully’

[citation omitted], the striking of their answer is appropriate.”


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Muboyayi v. Quintero, 136 A D 3d 497 (1st Dept. 2016) – “After plaintiff failed to

comply with a court order mandating that his deposition be completed on March 20,

2014, and failed to provide a reasonable excuse for this failure, the court providently

exercised its discretion in issuing the conditional order of preclusion [citations omitted].

Although defendant’s counsel promptly requested that plaintiff’s counsel identify the

dates on which plaintiff would be available to complete his deposition on or before the

August 29 deadline date set by the conditional order, plaintiff’s counsel failed to respond.

Instead, it was not until August 28 that plaintiff’s counsel called defendant’s counsel and

advised him that he had unilaterally scheduled plaintiff’s deposition for the deadline date

of August 29. Defense counsel replied that he could not proceed with the deposition on

such short notice and asked for a date on or before September 12. Plaintiff’s counsel

refused and did not respond to defense counsel’s subsequent request to reschedule. On

this record, the motion court correctly determined that plaintiff’s counsel’s conduct was

egregious and that plaintiff failed to comply in good faith with the conditional order.

Accordingly, the motion court ‘applied the correct legal standards, properly considered

all the facts and circumstances of the case, and did not abuse its discretion is dismissing

plaintiff’s action pursuant to CPLR 3126(3).’”

Vaca v. Village View Housing Corporation, 145 A D 3d 504 (1st Dept. 2016) – The

Appellate Division modifies Supreme Court’s order “which granted plaintiff’s motion to

strike defendants’ answers, and directed that the answers not be reinstated unless

defendants respond to plaintiff’s discovery demands.” The Court found that “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.”

Dedushaj v. 3175-77 Villa Avenue Housing Development Fund Corporation, 135 A D 3d

421 (1st Dept. 2016) – “The record shows that defendants failed to comply with a

conditional preclusion order directing them to produce an appropriate search affidavit.

The affidavit defendants provided did not explain what efforts, if any, were made to

preserve the requested documents, nor did it indicate whether the documents were

routinely destroyed [citation omitted]. However, the sanction of precluding defendants

from denying notice of the allegedly dangerous condition on the steps in the cooperative

building owned by the corporate defendant was not proportionate to defendants’

misconduct [citation omitted]. The requested documents were not relevant to notice.

Moreover, plaintiff has not been deprived of his ability to prove his case [citation


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omitted]. The individual defendant (the president of the cooperative’s board) was

produced for deposition and plaintiff was able to obtain information from her concerning

notice and maintenance procedures. Under the circumstances, a monetary sanction is

appropriate.”

Piemonte v. JSF Realty, LLC, 140 A D 3d 1145 (2d Dept. 2016) – “When a plaintiff fails

to timely comply with a conditional order of preclusion, the conditional order becomes

absolute [citations omitted]. ‘To obtain relief from the dictates of a conditional order that

will preclude a party from submitting evidence in support of a claim or defense, the

defaulting party must demonstrate (1) a reasonable excuse for the failure to produce the

requested items and (2) the existence of a meritorious claim or defense.” When, after a

conditional order becomes absolute, defendant moves for summary judgment based upon

the preclusion, counsel need not “file a good faith affirmation pursuant to 22 NYCRR

202.7(a)(2). The plain language of 22 NYCRR 202.7(a)(2) indicates that the affirmation

requirement applies only ‘with respect to a motion relating to disclosure or to a bill of

particulars’ [citation omitted]. A motion for summary judgment is not a discovery-

related motion requiring an affirmation of good faith.”

STIPULATIONS AND SETTLEMENT

Catsiapis v. Giano, N.Y.L.J., 1202758573856 (Sup.Ct. Queens Co. 2016)(Butler, J.) –

After this action was settled in open court, the parties disputed whether its provision to

keep “this matter” confidential referred to the entire lawsuit, or merely the terms of the

settlement. “There is ambiguity as to whether the parties intended the confidentiality of

‘this matter’ to mean that only the terms of the stipulation of settlement are confidential,

or the terms of the stipulation of settlement and all allegations forming the basis of the

claim are confidential. This Court cannot reform the stipulation of settlement to conform

to what it thinks is proper. Accordingly, the branches of the motion to reform the

stipulation of settlement and compel payment and the branch of the cross motion to

compel execution of the agreements are denied. The branch of the motion to vacate the

stipulation of settlement and schedule a trial date is granted.”

GLM Medical, P.C. v. Geico General Insurance Company, 50 Misc 3d 104 (App.Term

2d 2015) – “A notation on the New York State Unified Court System eCourts public

website indicates that the matter was ‘settled’ on March 9, 2009. Approximately 3 1/2

years later, plaintiff, asserting that the case was mistakenly marked ‘settled,’ moved to

restore the action to the trial calendar.” Although “the eCourts website, of which we may

take judicial notice [citations omitted], states that this matter was settled on March 9,

2009, such a notation on the website ‘does not constitute a sufficient memorialization of

the terms of the alleged settlement so as to satisfy the open-court requirement of CPLR

2104’ [citations omitted]. Furthermore, as there is no indication that the purported


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settlement was reduced to a writing and signed by the parties, or made in open court, an

enforceable settlement agreement cannot be determined from the record before us.”

Lopez v. Muttana, 144 A D 3d 871 (2d Dept. 2016) – “Stipulations of settlement,

particularly those entered into in open court pursuant to CPLR 2104, are favored by the

courts and will not be cast aside lightly [citations omitted]. In order to be relieved of the

consequences of a stipulation, a party must establish grounds to invalidate a contract,

such as duress, fraud, mistake, or accident [citations omitted]. ‘Repudiation of an

agreement on the ground that it was procured under duress requires the showing of a

wrongful threat and the preclusion of the exercise of free will’ [citations omitted].

Moreover, an agreement which is the product of duress must be promptly repudiated

[citations omitted]. Here, the plaintiff failed to allege any unlawful or wrongful threat by

his former counsel or by the trial court that could serve as the basis for a claim of duress

[citations omitted]. In any event, even if the plaintiff had adequately alleged duress, his

substantial and inexcusable delay [of more than 18 months] in seeking to repudiate the

stipulation of settlement warranted denial of his motion.”

Azbel v. County of Nassau, 149 A D 3d 1020 (2d Dept. 2017) – The parties entered into

an unconditional settlement of this personal injury action. Thereafter, the County

Legislature “authorized the County Attorney to settle the action ‘provided that a bond

ordinance to finance such settlement is adopted by this Legislature and any borrowing

pursuant to such bond ordinance is approved by the Nassau County Interim Finance

Authority, if such approval is required.’” The bond ordinance was not approved, and, by

the time defendant paid the amount of the settlement, from a different source, the 90 days

provided for such payment under CPLR 5003-a(b) had expired. Plaintiff accordingly

sought “interest, costs and disbursements” pursuant to CPLR 5003-a(e). The Court

denies the application. While the language of the settlement agreement contained no

condition to payment by 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,” and “‘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.’”

PRE-TRIAL PROCEEDINGS

Greco v. Wellington Leasing Limited Partnership, 144 A D 3d 981 (2d Dept. 2016) –

“The plaintiff’s certificate of readiness incorrectly stated that medical reports had been

exchanged, that there were no outstanding requests for discovery, and that discovery

known to be necessary had been completed, with the sole exception of ‘depositions of

certain party witnesses’ and ‘expert exchanges and discovery.’ Because this was a


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misstatement of a material fact, the filing of the note of issue and certificate of readiness

was a nullity, and the note and certificate should have been vacated.”

Florexile-Victor v. Douglas, 135 A D 3d 903 (2d Dept. 2016) – The plaintiff, acting pro

se, commenced an action for, inter alia, declaratory relief, and damages for assault. The

Court directed that, with respect to certain claims, plaintiff’s remedy was to commence

an Article 78 proceeding, and to file a petition, and a new summons and complaint.

Plaintiff failed to do so, and, eventually, the case was marked “disposed.” More than a

year later, plaintiff seeks to restore the case to the calendar. “Contrary to the [defendant]

hospital’s contention, CPLR 3404 does not apply to this pre-note of issue case [citations

omitted]. Furthermore, there was no 90-day notice pursuant to CPLR 3216, nor was

there any order directing the dismissal of the complaint pursuant to 22 NYCRR 202.27

[citations omitted]. Accordingly, the plaintiff’s motion to restore the case to the calendar

should have been granted.”

Ortiz v. Wakefern Food Corp., 145 A D 3d 1024 (2d Dept. 2016) – After discovery was

conducted, and a note of issue served and filed, “the parties agreed to strike the note of

issue and remove the action from the trial calendar. The plaintiff subsequently moved,

inter alia, to restore the action to active status, and the Supreme Court granted the

motion. Contrary to the appellants’ contentions, the plaintiff was not required to

establish his entitlement to restoration of the action under the standard applicable to

automatic dismissals pursuant to CPLR 3404. Where, as here, the note of issue has been

vacated, the case reverts to its pre-note of issue status, and CPLR 3404 is not applicable

[citations omitted]. In the absence of a 90-day demand pursuant to CPLR 3216, the

plaintiff was entitled to have the action restored to active status.”

Salatino v. Pompa, 134 A D 3d 692 (2d Dept. 2015) – “Under CPLR 3404, a case not

restored within a year after being marked off the trial calendar is deemed abandoned and

automatically dismissed for neglect to prosecute. After the plaintiff undertook little or no

action to prosecute the case during the ensuing two years after it was marked off the

calendar, the defendant moved, inter alia, to dismiss the complaint as abandoned. To

successfully oppose the defendant’s motion, the plaintiff was required to demonstrate a

potentially meritorious cause of action, a reasonable excuse for the delay in prosecuting

the action, a lack of intent to abandon the action, and a lack of prejudice to the

defendant.” Here, plaintiff failed to demonstrate any of these.

Hayes v. Village of Middleburgh, 140 A D 3d 1359 (3d Dept. 2016) – Pursuant to 22

NYCRR 202.27, “‘At any scheduled call of a calendar or at any conference if the

defendant appears but the plaintiff does not, the judge may dismiss the action.’” And,

“cases evaluating the propriety of a dismissal under 22 NYCRR 202.27 routinely

reference CPLR 5015(a)(1) [citations omitted], upon which the parties here also rely.

CPLR 5015 provides, in relevant part, that a court may vacate a judgment or order upon


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the ground of ‘excusable default, if such motion is made within one year after service of a

copy of the judgment or order with written notice of its entry upon the moving party’

[citations omitted] – provided the defaulting party demonstrates both a reasonable excuse

for the default and the existence of a potentially meritorious cause of action.” Here,

plaintiff did not move to vacate the 202.27 dismissal order until more than two years after

notice of its entry. “While it is true, as plaintiff points out, that Supreme Court retains

inherent authority to vacate its own judgment or order ‘in the interest of justice, even

where the statutory one-year period under CPLR 5015(a)(1) has expired’ [citations

omitted], plaintiff’s motion papers fail to articulate any reasonable excuse for his more

than two-year delay in bringing the underlying motion to vacate.”

Pak v. Lancaster, N.Y.L.J., 1202787244698 (Sup.Ct. Queens Co. 2017)(Modica, J.) –

Plaintiff seeks a trial preference pursuant to CPLR 3403(a)(4) on the ground that plaintiff

is 70 years of age or older. But plaintiff failed to provide any documentary proof of age,

other than his own affidavit. Accordingly, even though the motion is unopposed, it is

denied with leave to renew. For, “in the interest of protecting the rolls of litigants waiting

their turn patiently for their long-awaited ‘day in court,’ this Court, therefore, will not

take the word of the plaintiff as to his age.”

TRIAL AND JUDGMENT

JURY ISSUES

Moyal v. Sleppin, 139 A D 3d 605 (1st Dept. 2016) – “Supreme Court erred in finding

that plaintiff in this shareholders’ derivative action was entitled to a jury trial, since the

claims brought in his capacity as a shareholder were ‘derivative and therefore equitable in

nature’ [citations omitted]. Contrary to plaintiff’s contention, the motion was not

untimely, since a motion to strike a demand for a jury trial may be made at any time up to

the opening of trial [citation omitted], and we find no prejudice in defendants’ delay of a

few months, following the restoration of the case to the calendar, in making their

motion.”

Security Pacific National Bank v. Evans, 148 A D 3d 465 (1st Dept. 2017) – “The motion

court properly determined that defendant has no right to a jury trial on the triable issues

identified by this Court of a prior appeal [citation omitted]. Since both parties sought

equitable relief – that is, specific performance of their settlement agreement or injunctive

relief – defendant is not entitled to a jury trial [citations omitted]. Even if defendant now

asserts a claim for money damages, and even if she were to withdraw her equitable

claims, that would not revive or create a right to a trial by jury that was waived by

asserting equitable claims with respect to the same transaction.”


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Cicco v. Durolek, 147 A D 3d 1486 (4th Dept. 2017) – “Plaintiff appeals from an order

granting defendants’ motion for leave to serve and file a late demand for a jury trial

pursuant to CPLR 4102(e). Contrary to plaintiff’s contention, Supreme Court did not err

in granting the motion. The decision ‘whether to relieve a party from failing to timely

comply with CPLR 4102(e) lies within the sound discretion of the trial court’ [citation

omitted]. ‘The only limitation on the court’s discretion appears to be that any decision to

forgive such a waiver should not unduly prejudice the other party or parties.’” Here, no

such prejudice was shown.

People v. Bridgeforth, 28 N Y 3d 567 (2016) – “This appeal requires us to consider

whether skin color [“as a separate and distinct classification from ‘race’”] of a

prospective juror is a cognizable classification upon which a challenge to a prosecutor’s

use of peremptory strikes under Batson v. Kentucky (476 U S 79 [1986]) may be based.

We recognize the existence of discrimination on the basis of one’s skin color, and

acknowledge that under this State’s Constitution and Civil Rights Law, color is a

classification upon which a Batson challenge may be lodged.”

VERDICTS

Oh v. Koon, 140 A D 3d 861 (2d Dept. 2016) – “Absent exceptional circumstances, a

juror’s affidavit may not be used to attack a jury verdict [citations omitted]. The use of

post-discharge juror affidavits to attack the verdict is ‘patently improper’ where the

record is devoid of any evidence of external influence, juror confusion, or ministerial

error in reporting the verdict [citations omitted]. Here, the plaintiffs acknowledged that

the jury was properly charged and there was absolutely no evidence on the record of any

juror confusion regarding any issue related to the Supreme Court’s instructions. It is

undisputed that the jurors never requested a read-back of any portion of the court’s

instructions. Under these circumstances, the use of juror affidavits in an attempt to attack

the verdict is patently improper.”

Russo v. Levat, 143 A D 3d 966 (2d Dept. 2016) – “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]. The trial court must decide

whether substantial justice has been done, and must look to common sense, experience,

and sense of fairness in arriving at a decision [citation omitted]. Here, the Supreme Court

erred in granting that branch of the plaintiff’s motion which was pursuant to CPLR

4404(a) to set aside the verdict in the interest of justice and for a new trial as to the causes

of action against Morimoto. The court’s original denial of the plaintiff’s request for a

missing witness charge as untimely was not error since it was made after the close of all

the evidence.”


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Killon v. Parrotta, 28 N Y 3d 101 (2016) – “The Appellate Division may not disregard a

jury verdict as against the weight of the evidence unless ‘the evidence so preponderated

in favor of the moving party that it could not have been reached on any fair interpretation

of the evidence’ [citation omitted]. Where the Appellate Division determines that a

verdict is against the weight of the evidence, the remedy is to remit for a new trial. By

contrast, 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’ [citation

omitted]. To conclude that a verdict is utterly irrational, requiring vacatur of the verdict,

the Court must determine that ‘there is simply no valid line of reasoning and permissible

inferences which could possibly lead a rational person to the conclusion reached by the

jury on the basis of the evidence presented at trial’ [citation omitted]. ‘When it can be

said that “it would not be utterly irrational for a jury to reach the result it determined, the

court may not conclude that the verdict is as a matter of law not supported by the

evidence.”’” Here, the Appellate Division set aside a verdict for defendant and

concluded that “as a matter of law” defendant “was the initial aggressor in the physical

altercation between the parties, rendering a justification defense unavailable to defendant

during retrial of the case. We hold that the Appellate Division did not apply the ‘utterly

irrational’ test required to make that determination as a matter of law. Applying that test

to the trial evidence and in consideration of the jury instruction given, we hold that it was

not utterly irrational for the jury to find that defendant was not the initial aggressor and

that he acted in self-defense. We therefore reverse and remit to Supreme Court for

retrial.”

INTEREST

Mahoney v. Brockbank, 142 A D 3d 200 (2d Dept. 2016) – CPLR 5002 provides that, in

personal injury actions, “interest shall be recovered upon the total sum awarded,

including interest to verdict, report or decision, in any action, from the date the verdict

was rendered or the report or decision was made to the date of entry of final judgment”

[emphasis added]. Thus, when “determination of liability and damages are bifurcated,

the general rule is that prejudgment interest under CPLR 5002 runs from the date of the

‘verdict, report or decision’ as to liability, rather than from the date of the ‘verdict, report

or decision’ as to damages [citations omitted]. The rationale for this rule is that the

plaintiff’s right to recover damages became fixed in law on the date that liability was

determined. From that date forward, the defendant is considered to be in possession of

the plaintiff’s property, namely, the amount that the plaintiff is entitled to recover.” Here,

liability was fixed not by trial, but by a stipulation that had other provisions as well. And,

rules the Court, “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.” And, “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.”


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Accordingly, interest here runs from the damages verdict. “The plaintiff’s argument is

well-founded, but ultimately unavailing because we must apply CPLR 5002, not amend

it. As the Court of Appeals said with regard to prejudgment interest in a different context,

we ‘may not rewrite the statute to achieve more “fairness” than the Legislature chose to

enact.’”

New York State Thruway Authority v. Allied Waste Services of North America, LLC,

143 A D 3d 1145 (3d Dept. 2016) – “Prejudgment ‘interest shall be recovered upon a

sum awarded’ by virtue of, among other things, an act that interferes with ‘title to, or

possession or enjoyment of, property’ [citations omitted]. Such interest is calculated

‘from the earliest ascertainable date the cause of action existed, except that interest upon

damages incurred thereafter shall be computed from the date incurred [citations omitted].

The earliest ascertainable date a cause of action for damage to property exists is the time

at which the injury occurs [citations omitted]. The earliest date plaintiff’s cause of action

existed was March 23, 2011, as that was the date on which plaintiff sustained damages to

its bridge as a result of defendants’ negligence, despite the fact that plaintiff waited to

expend funds to make permanent repairs until after defendant paid the revised cost

estimate [citations omitted]. Inasmuch as all of the damage to the bridge was sustained

on the day of the accident and no further damages were incurred thereafter, the exception

to CPLR 5001(b) does not apply.”

Castle Restoration & Construction, Inc. v. Castle Restoration, LLC, 149 A D 3d 692 (2d

Dept. 2017) – “‘When a contract provides for interest to be paid at a specified rate until

the principal is paid, the contract rate of interest, rather than the legal rate set forth in

CPLR 5004, governs until payment of the principal or until the contract is merged in a

judgment’ [citations omitted]. Here, because the promissory note provides for interest at

a rate of 3% annually, the Supreme Court properly calculated prejudgment interest at that

rate.”

POWERS OF REFEREES

Bauer v. Special Brands NY, Inc., 138 A D 3d 1048 (2d Dept. 2016) – “Inasmuch as the

order of reference, which was made on consent, directed the referee to hear and

determine [citation omitted], rather than to hear and report on [citation omitted], the

division of legal fees, the referee possessed ‘all the powers of a court in performing a like

function’ [citation omitted], and the referee’s determination of that issue stands as the

decision of a court [citations omitted]. Consequently, the Supreme Court lacked the

authority to review the referee’s substantive determination, and any attempt to reargue

the substantive issue decided by the referee should have been directed to the referee.”

Daly v. Courten, N.Y.L.J., 1202767549454 (Sup.Ct. Kings Co. 2016)(Rivera, J.) – The

parties here stipulated to referral to a referee “to hear and determine.” Thereafter, the

parties reached a settlement agreement, providing, as pertinent, that the referee “retain


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jurisdiction to resolve any dispute in the enforcement of the settlement.” Since “a referee

appointed to hear and determine an issue has all the powers of the court in performing a

like function, including entertaining post-trial motions pursuant to CPLR article 44,” this

motion, relating to the enforcement of the settlement, must be referred to the referee.

JUDGMENTS

Matter of Pulte Homes of New York, LLC v. Planning Board of Town of Carmel,

136 A D 3d 643 (2d Dept. 2016) – “Trial courts and appellate courts have discretion

pursuant to CPLR 5019(a) to correct mistakes, defects, or irregularities so as to modify an

order or judgment [citation omitted]. ‘Where a movant seeks to change an order or

judgment in a substantive manner, rather than correcting a mere clerical error, CPLR

5019(a) is not the proper procedural mechanism to be employed, and relief should be

sought through a direct appeal or by motion to vacate pursuant to CPLR 5015(a).’”

Matter of Franco Belli Plumbing and Heating and Sons, Inc. v. New York City School

Construction Authority, 142 A D 3d 1011 (2d Dept. 2016) – “Supreme Court properly

denied that branch of the petitioner’s motion which was to vacate the judgment [entered

December 21, 2012] pursuant to CPLR 5015(a)(2). In support of its motion, the

petitioner submitted certain interrogatory responses dated May 14, 2013, and the

transcript of a deposition conducted on July 16, 2013. Those submissions did not

constitute newly discovered evidence within the meaning of CPLR 5015(a)(2) since they

were not in existence at the time the judgment was issued.”

ARTICLE 78 PROCEEDINGS

GENERAL CONSIDERATIONS

Matter of Adoui v. Commissioner of Permit and Inspection Services, 147 A D 3d 1404

(4th Dept. 2017) – “‘Should the body or officer fail either to file and serve an answer or

move to dismiss [an Article 78 proceeding], the court may either issue a judgment in

favor of the petitioner or order that an answer be submitted’ [citation omitted]. In light of

this State’s policy against annulling an administrative body’s determination on the basis

of a failure to answer the petition [citation omitted], we vacate the order insofar as it

transferred the proceeding to this Court and remit the matter to Supreme Court with

instructions to direct respondents to file an answer with the complete administrative

record.”

Matter of Tonawanda Seneca Nation v. Noonan, 27 N Y 3d 713 (2016) – A prior year’s

“Update” reported on the Appellate Division decision in this proceeding [122 A D 3d

1334 (4th Dept. 2014)]. The Appellate Division held that, “contrary to petitioner’s

contention, respondent is the duly elected Surrogate for Genesee County, a position not


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specifically delineated in CPLR 506(b)(1) and, therefore, a proceeding against him

[pursuant to CPLR Article 78] must be commenced in Supreme Court. Even if we

assume, arguendo, that respondent was elected as a County Court Judge and was

thereafter assigned to ‘be and serve as’ a Surrogate [citation omitted], petitioner is

seeking to prohibit respondent from acting in the role of Surrogate. We thus conclude

that jurisdiction remains in Supreme Court.” The Court of Appeals has affirmed. “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.”

Matter of Clark v. Newbauer, 148 A D 3d 260 (1st Dept. 2017) – Respondent Justice

ruled, in a criminal proceeding, that the Grand Jury’s indictment of the criminal

defendant of robbery in the third degree, and failure to indict on a charge of robbery in

the first degree, acted as collateral estoppel to preclude petitioner District Attorney from

adducing evidence that the defendant was armed. Petitioner sought a writ of prohibition.

The Court grants the writ. “A writ of prohibition is an extraordinary remedy, only

available to prevent a court from either acting without jurisdiction or in excess of its

authorized powers in a proceeding over which it otherwise has jurisdiction [citations

omitted]. Prohibition is not available to review mere errors of law, even when the errors

are truly egregious [citation omitted]. ‘Although the distinction between legal errors and

actions made in excess of authority is not always easily made, abuses of power may be

identified by their impact on the entire proceeding as distinguished from an error in a

proceeding itself’ [citation omitted]. The trial court’s ruling in this case was an error that

affected the entire proceeding and thus constituted an excess of the court’s authority. The

rule prevents the People from proving the element of force required under third degree

robbery because the gun was the only evidence of force that was presented to the grand

jury.” Thus, “a writ of prohibition will lie where a trial court’s erroneous ruling affects

the proceeding in a conclusive manner, by terminating the case [citation omitted]. At bar,

although the ruling did not actually terminate the case, it effectively terminated the ability

of the People to prosecute the highest count in the indictment [citations omitted]. We

therefore find that the court’s ruling is reviewable by way of a writ of prohibition.” Of

course, “even where, as here, the remedy of prohibition is available, the decision to

prohibit is still a matter within this Court’s discretion [citation omitted]. Extraordinary

remedies, including prohibition will not lie if there is an available remedy at law [citation

omitted]. If, however, the ruling is not reviewable, that is an important consideration but

alone may not necessarily provide a basis for reviewing errors by way of a collateral

proceeding [citation omitted]. The preclusion order challenged in this petition is not

appealable, and absent the granting of this writ, the prosecution has no remedy or way to

obtain appellate review.”

Matter of Raiser & Kenniff, P.C. v. Nassau County Sheriff’s Department, 149 A D 3d

1084 (2d Dept. 2017) – Petitioner sought “to prohibit the Nassau County District

Attorney’s Office from ordering recordings of conversations of inmates housed at the


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Nassau County Correctional Facility without a subpoena issued upon notice to defense

counsel,” and “mandamus to compel the Nassau County Sheriff’s Department” to

“deliver such recordings only after receiving a properly issued subpoena.” The Appellate

Division affirms dismissal of the petition. As to the writ of prohibition, “‘the remedy is

confined to judicial or quasi-judicial action rather than to legislative, executive,

administrative or ministerial acts’ [citations omitted]. Here, the petitioner failed to

demonstrate that the conduct sought to be prohibited pertained solely to quasi-judicial

action, as opposed to an investigative function performed in an executive capacity.” As

to mandamus to compel, that “extraordinary remedy” will lie “only to compel the

performance of a ministerial act, and only where there exists a clear legal right to the

relief sought.” That was not demonstrated here.

Matter of Masullo v. City of Mount Vernon, 141 A D 3d 95 (2d Dept. 2016) – “Since the

petition raised a substantial evidence question, and the remaining points raised by the

petitioner that were determined by the Supreme Court were not objections that could

have terminated the proceeding within the meaning of CPLR 7804(g), the Supreme Court

should have transferred the entire proceeding to this Court.” Accordingly, the Appellate

Division vacated the portion of Supreme Court’s order that decided those other issues,

and will “consider de novo all of the issues raised in the petition.”

Parker v. Town of Alexandria, 138 A D 3d 1467 (4th Dept. 2016) – “‘It is “well

established that a CPLR article 78 proceeding is not the proper vehicle to test the validity

of a legislative enactment.’” Accordingly, Supreme court erred in applying the

procedural rules of Article 78 to this “hybrid” action. “Inasmuch as the cause of action

and counterclaim seek declaratory relief, the court ‘erred in issuing a judgment declaring

that those legislative enactments are invalid by using a summary procedure that pertains

only to CPLR article 78 proceedings.’”

STATUTE OF LIMITATIONS

Matter of Brennan Center for Justice at NYU School of Law v. New York State Board of

Elections, 52 Misc 3d 246 (Sup.Ct. Albany Co. 2016)(Fisher, J.) – “Where the [Article

78] petition challenges an agency’s quasi-legislative function, such as the issuance of

regulations or decisions/opinions, New York courts have consistently held the accrual

date to be the date of such promulgation or issuance rather than the date the individual

petitioner was aggrieved by such regulation or opinion’s application.”

Matter of Knavel v. West Seneca Central School District, 149 A D 3d 1614 (4th Dept.

2017) – A splintered Appellate Division concludes that petitioners’ Article 78 proceeding

is not time-barred. Petitioners are retired employees of respondent School District. The

challenged act was the determination by respondent, contained in a letter mailed on June

5, 2014, addressed to “Retirees Under age 65 carrying Blue Cross Blue Shield Health

Insurance,” and stating that “effective July 1, 2014, West Seneca Central School District


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will no longer offer Under Age 65 retirees the option of carrying their health insurance

through the active employee Blue Cross Blue Shield plan.” The Court was unanimous

that “the ‘determination to be reviewed’ in this proceeding is the decision embodied in

the undated letter sent on June 5, 2014.” What divided the Court was whether the date of

mailing, or the date of receipt, began the running of the statute of limitations. The two-

Justice plurality opinion rejected respondent’s argument 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.” For, “a quasi-legislative-type administrative determination is one

having an impact far beyond the immediate parties at the administrative stage [citations

omitted]. Thus, where a quasi-legislative determination is challenged, ‘actual notice of

the challenged determination is not required in order to start the statute of limitations

clock’ [citations omitted]. The policy underlying the rule is that actual notice to the

general public is not practicable [citation omitted]. Instead, the statute of limitations

begins to run once the administrative agency’s quasi-legislative determination of the

issue becomes ‘readily available’ to the complaining party [citation omitted]. On the

other hand, where the public at large is not impacted by a determination, actual notice

commonly in the form of receipt of a letter or other writing containing the final and

binding determination, is required to commence the statute of limitations.” Here, “the

determination clearly had no impact upon the public at large.” Therefore, “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.” One Justice concurred in result only.

She agreed with the dissenters that respondent’s determination “was a quasi-legislative

determination.” For, “the nature of the determination, i.e., the decision of a school

district to discontinue offering certain of its retirees enrollment access to a particular

health insurance plan, has none of the hallmarks of quasi-judicial decision-making.”

However, the concurring Justice concluded that merely placing a letter in a mailbox did

not render “the determination contained in that letter readily ascertainable to the affected

retirees on that same date. The record does not establish that respondents undertook any

other notification procedures to disseminate the subject information that would have

adequately provided petitioners with constructive notice of the District’s determination

on that date.” The two-Justice dissent argued that, “inasmuch as the nature of the action

taken by the District was quasi-legislative, the undisputed date of the determination’s

mailing is, as a matter of public policy, the accrual date.”

Matter of Granto v. City of Niagara Falls, 148 A D 3d 1694 (4th Dept. 2017) – The

majority of this divided Court holds that “it is well settled that where, as here, the

proceeding is in the nature of mandamus to compel, it ‘must be commenced within four

months after refusal by respondent, upon demand of petitioner, to perform its duty’

[citations omitted]. ‘A petitioner, however, may not delay in making a demand in order

to indefinitely postpone the time within which to institute the proceeding. The petitioner


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must make his or her demand within a reasonable time after the right to make it occurs, or

after the petitioner knows or should know of the facts which give him or her a clear right

to relief, or else, the petitioner’s claim can be barred by the doctrine of laches’ [citation

omitted]. Inasmuch as ‘the problem is one of the statute of limitations, it is immaterial

whether or not the delay causes any prejudice to the respondent’ [citations omitted].

Thus, to the extent that we held in Matter of Degnan v. Rahn (2 A D 3d 1301, 1302

[2003]) that a respondent is required to make a showing of prejudice to establish that a

proceeding in the nature of mandamus to compel is barred by the doctrine of laches, that

case is no longer to be followed. ‘The four-month limitations period of CPLR article 78

proceedings has been “treated as a measure of permissible delay in making of the

demand.’”” The dissenting Justice argued that “‘the sole test for courts to consider is

whether, under the circumstances of the case, the petitioners’ delay in making the

demand was unreasonably protracted.” And, “in my view, however, this 10-month delay

in making the demand was not so unreasonable as to deprive petitioners of their day in

court.” And, the dissent was “concerned that the majority’s decision seeks to draw a hard

and fast line rather than following long-established precedent requiring that we apply a

facts-and-circumstances test to determine whether the excuse for delay is reasonable.”

Lancman v. De Blasio, N.Y.L.J., 1202781108093 (Sup.Ct. N.Y.Co. 2017)(Bluth, J.) – In

this declaratory judgment action, plaintiffs challenge the creation of the Alliance for

Flushing Meadows-Corona Park, claiming that its license agreement with the City, and its

by-laws, violate §18-137(b) of the City Administrative Code, which “requires that there

be at least one voting board member from each overlapping City Council district and one

representative for every two abutting districts.” Defendants, claiming that the proceeding

is, in effect, one pursuant to CPLR Article 78, seeks dismissal on statute of limitations

grounds. “‘When the proceeding has been commenced in the form of a declaratory

judgment action, for which no specific Statute of Limitations is prescribed, “it is

necessary to examine the substance of that action to identify the relationship out of which

the claim arises and the relief sought” in order to resolve which Statute of Limitations is

applicable.’” Here, “the facts of the instant lawsuit do not support” defendants’

argument. For, “defendants are unable to identify a specific determination made by the

Alliance that could be raised in an Article 78 proceeding.” Indeed, “the plaintiffs are

challenging the inherent structure and funding scheme of the Alliance rather than a

distinct, discrete finding made by the Alliance.” Plaintiffs “seek a declaration that the

current by-laws and funding scheme of the Alliance violate the law. That is not in the

nature of an Article 78 proceeding and therefore, a six-year statute of limitations applies.”

ARBITRATION


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ARBITRABILITY

Matter of Monarch Consulting, Inc. v. National Union Fire Insurance Company of

Pittsburgh, PA, 26 N Y 3d 659 (2016) – “‘Arbitration is a matter of contract and a party

cannot be required to submit to arbitration any dispute which he or she has not agreed so

to submit’ [citations omitted]. As the United States Supreme Court has stated,

‘challenges to the validity of arbitration agreements can be divided into two types,’

namely, ‘challenges specifically to the validity of the agreement to arbitrate’ and

‘challenges to the contract as a whole, either on a ground that directly affects the entire

agreement (e.g., the agreement was fraudulently induced) or on the ground that the

illegality of one of the contract’s provisions renders the whole contract invalid’ [citation

omitted]. ‘Attacks on the validity of the contract, as distinct from attacks on the validity

of the arbitration clause, itself, are to be resolved “by the arbitrator in the first instance,

not by a federal or state court”’ [citations omitted]. The Supreme Court has also held that

arbitration agreements must be enforced according to their terms, and that ‘parties can

agree to arbitrate “gateway” questions of “arbitrability”’ [citations committed]. Such

‘delegation clauses’ are enforceable where ‘there is “clear and unmistakable” evidence’

that the parties intended to arbitrate arbitrability issues [citations omitted]. ‘When

deciding whether the parties agreed to arbitrate a certain matter (including arbitrability),

courts generally should apply ordinary state-law principles that govern the formation of

contracts’ [citation omitted]. Further, ‘courts treat an arbitration clause as severable from

the contract in which it appears and enforce it according to its terms unless the party

resisting arbitration specifically challenges the enforceability of the arbitration clause

itself’ [citations omitted]. This rule of severability extends to delegation clauses, which

are severable from larger arbitration provisions [citations omitted]. Thus, where a

contract contains a valid delegation to the arbitrator of the power to determine

arbitrability, such a clause will be enforced absent a specific challenge to the delegation

clause by the party resisting arbitration.”

Garthon Business Inc. v. Stein, 138 A D 3d 587 (1st Dept. 2016) – The majority of this

closely-divided Court holds that, “although this Court does not appear to have directly

addressed the issue, the other Departments have held that, where some of a group of

claims are covered by an arbitration agreement, it is appropriate to litigate the entire

group in court if all of the claims were already asserted in court and the claims not

subject to arbitration would be ‘inextricably bound together’ with the claims that are

subject to arbitration.” The dissenters argued that, under the agreement at issue, the

question of arbitrability should be decided by the arbitrators.

Skyline Steel, LLC v. PilePro LLC, 139 A D 3d 646 (1st Dept. 2016) – “Both the

arbitration clause and the JAMS rule incorporated therein confer on the arbitrators the

power to resolve arbitrability [citation omitted]. These provisions, governing the specific

issue, take precedence over the arbitration clause’s generic incorporation of the “New


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York statutes governing arbitration’ [citations omitted]. The issues of whether the parties

manifested an intent that the arbitration clause survive termination of the settlement

agreement containing it [citation omitted] and whether the agreement was induced by

fraud [citation omitted] are also to be resolved by the arbitrators.”

ARBITRATION AGREEMENTS

Wolf v. Wahba, N.Y.L.J., 1202770765837 (Sup.Ct. Kings Co. 2016)(Knipel, J.) –

Plaintiff is the widow of a former partner of defendant. She claims she was fraudulently

induced to sell her inherited interest in the partnership’s real property to defendant. The

original partnership agreement contained an arbitration provision. “Parties may not be

compelled to arbitrate unless the evidence establishes a clear, explicit and unequivocal

agreement to arbitrate.” Here, “the record shows no agreement to arbitrate signed by

plaintiff.” Accordingly the motion to compel arbitration is denied.

Resorb Networks, Inc. v. YouNow.com, 51 Misc 3d 975 (Sup.Ct. N.Y.Co. 2016)(Reed, J.)

– Defendant seeks to enforce an arbitration agreement entered into by means of an

internet “License Agreement.” “In regard to online contracts, courts look for evidence

that a website user had actual or constructive notice of the terms of using the website

[citation omitted]. Where the supposed assent to terms is mostly passive, as it usually is

online, courts seek to know ‘whether a reasonably prudent offeree would be on notice of

the term at issue’ [citation omitted], and whether the terms of the agreement were

‘reasonably communicated’ to the user.” Here, defendant has failed to make such a

showing, and the motion to compel arbitration is denied.

CPLR VS. FEDERAL ARBITRATION ACT

Johnson v. Ace Home Inspections of Upstate New York, N.Y.L.J., 1202778462427 (City

Ct. Cohoes 2017)(Marcelle, J.) – Defendant moves to stay this small claims action,

seeking $600 on a claim of negligent inspection of a roof, because the contract between

the parties provided that “in matters of dispute, the ‘client’ agrees to submit to binding

arbitration by mutually agreed upon party(s)(sic).” The Court concludes that, under New

York law, “‘the defendant cannot by “contract” deny access to small claims court without

a specific and agreed-to written waiver by the consumer.’ In other words, for an

arbitration clause to eradicate small claims jurisdiction, the parties must explicitly waive

the right to proceed in small claims court. That did not happen here – the clause has no

effect – at least under New York law.” However, “the federal issue is not so effortlessly

disposed of.” For, “to begin with, the Court cannot simply conclude that small claims

matters trump the FAA. In a brigade of cases, the Supreme Court has made it

unrelentingly clear that when state law prohibits outright the arbitration of a particular

type of claim (like small claims), the analysis is straightforward: The conflicting rule is

displaced by the FAA.” And, since the Supreme Court has held “that activities that


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‘substantially affect’ commerce may be regulated [by the FAA] so long as they

substantially affect interstate commerce in the aggregate, even if their individual impact

on interstate commerce is minimal,” the inspection here, which “facilitates the home’s

purchase,” affects commerce. “Although the FAA creates no exceptions for small

claims, under the particular circumstances of this case to enforce arbitration is to enforce

absurdity. The cost of arbitration is prohibitive in relationship to the amount of

Johnson’s claim. Johnson must spend thousands of dollars to recover hundreds – she

cannot win. Where the fee to arbitrate exceeds the maximum possible recovery, such

clauses perpetrate an irreconcilable injustice – compelling arbitration in this case does not

seem fair. Nevertheless, while this Court may express its disagreement with an Act of

Congress or a decision of the United States Supreme Court, it may not dissociate itself

from federal law. The FAA is the law of the United States and must be faithfully adhered

to [citation omitted]. It is the Court’s hope, however, that the Congress will see fit to

exempt small claims actions from the inflexible reins of the FAA. Until then, however,

the FAA controls. Arbitration will be compelled.”

WAIVER OF ARBITRATION

Trombley Painting Corp. v. Global Industrial Services, Inc., N.Y.L.J., 1202763984277

(Sup.Ct. Clinton Co. 2016)(Muller, J.) – “Defendant has waived its right to compel

arbitration under the dispute resolution provision of the Agreement. Defendant clearly

reviewed the Agreement upon commencement of the action and – rather than proceeding

with a motion to dismiss based upon plaintiff’s failure to comply with the dispute

resolution provision – defendant moved to change venue under the forum selection

clause. Then, when that motion was denied, defendant participated in a preliminary

conference, exchanged discovery and established a date for depositions. The instant

motion was not filed until one week prior to the scheduled date of depositions. These

actions are not consistent with an assertion of the right to arbitrate. Rather, defendant’s

participation in this litigation manifests its affirmative acceptance of the judicial forum.”

COMPELLING OR CHALLENGING ARBITRATION

Kindred Nursing Centers Limited Partnership v. Clark, ___ U.S. ___, 137 S.Ct. 1421

(2017) – “In the decision below, the Kentucky Supreme Court declined to give effect to

two arbitration agreements executed by individuals holding ‘powers of attorney’ – that is,

authorizations to act on behalf of others. According to the court, a general grant of power

(even if seemingly comprehensive) does not permit a legal representative to enter into an

arbitration agreement for someone else; to form such a contract, the representative must

possess specific authority to ‘waive his principal’s fundamental constitutional rights to

access he courts and to trial by jury’ [citation omitted]. Because that rule singles out

arbitration agreements for disfavored treatment, we hold that it violates the F[ederal]

A[rbitration] A[ct].” For, “a court may invalidate an arbitration agreement based on

‘generally applicable contract defenses’ like fraud or unconscionability, but not on legal


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rules that ‘apply only to arbitration or that derive their meaning from the fact that an

agreement to arbitrate is at issue’ [citation omitted]. The FAA thus preempts any state

rule discriminating on its fact against arbitration – for example, a ‘law prohibiting

outright the arbitration of a particular type of claim’ [citation omitted]. And not only

that: The Act also displaces any rule that covertly accomplishes the same objective by

disfavoring contracts that (oh so coincidentally) have the defining features of arbitration

agreements.” Justice Thomas dissented, continuing “to adhere to the view that the

Federal Arbitration Act [citation omitted] does not apply to proceedings in state courts.”

Gold v. New York Life Insurance Co., ___ A D 3d ___, 2017 WL 3026906 (1st Dept.

2017) – A narrowly divided Appellate Division concludes that employees cannot “be

obliged to arbitrate collective disputes such as class actions regarding wage disputes with

their employers,” because “that obligation would run afoul of the National Labor

Relations Act.” In so holding, the majority agreed with the United States Courts of

Appeal for the Seventh and Ninth Circuits, and disagreed with contrary holdings by the

Second, Fifth and Eighth Circuits, noting that in a more recent case, the Second Circuit,

though concluding that it was bound by its own prior precedent, “stated that if it were

writing on a clean slate, it might ‘well be persuaded’ to join the Seventh and Ninth

Circuits in finding that a waiver of collective action is unenforceable.” The dissenters

argued that the requirement of arbitration in the subject employment contracts “are

enforceable under the Federal Arbitration Act.” The question will soon become

academic, as the Supreme Court of the United States granted certiorari in Seventh and

Ninth Circuit cases on this issue for argument in the October 2017 Term.

Markowits v. Friedman, 144 A D 3d 993 (2d Dept. 2016) – “A broad arbitration

provision is separable from the substantive provisions of a contract such that the

agreement to arbitrate is valid even if the substantive provisions of the contract were

induced by fraud [citations omitted]. ‘The issue of fraud in the inducement affects the

validity of the arbitration clause only when the fraud relates to the arbitration provision

itself, or was “part of a grand scheme that permeated the entire contract.”’”

Scanomat A/S v. Boies, Schiller & Flexner, N.Y.L.J., 1202779528329 (Sup.Ct. N.Y.Co.

2017)(Freed, J.) – “Respondent’s argument that petitioner’s application [to stay

arbitration] must be denied because the latter failed to move to stay arbitration within 20

days after it was served with the D[emand]F[or]A[rbitration] is without merit. CPLR

7503(c) provides, inter alia, that a notice of intention to arbitrate or a demand for

arbitration must state that ‘unless the party served applies to stay to arbitration within

twenty days after such service it shall thereafter be precluded from objecting that a valid

agreement was not made or has not been complied with’ and that ‘an application to stay

arbitration must be made by the party served within twenty days after service upon it of

the notice or demand for arbitration, or it shall be so precluded.’ Here, it is undisputed

that petitioner did not move to stay arbitration within the 20-day period. However, the


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petition to stay arbitration was not time-barred because respondent failed to include in the

DFA the requisite statutory language warning petitioner that it had 20 days in which to

move for such a stay.” Nor did the fact that respondent had filed for arbitration and paid

both sides’ fees for arbitration before this application was made waive petitioner’s right

to seek a stay.

Matter of Allstate Insurance Company (Cappadonia), 143 A D 3d 1266 (4th Dept. 2016)

– “Although the 20-day time limit of CPLR 7503(c) does not apply if the parties never

had ‘any agreement to arbitrate’ (Matter of Matarasso [Continental Cas. Co.], 56 N Y 2d

264, 268 [1982]), the ‘Matarasso exception is inapplicable’ because ‘the contract at issue

in this case contains 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 ‘contends that there is no coverage

under the policy’s SUM provisions is outside the Matarasso exception.’”

BGC Notes, LLC v. Gordon, 142 A D 3d 435 (1st Dept. 2016) – A non-party to an

agreement containing an arbitration clause may be compelled to arbitrate a dispute

relating to that agreement, when it received a “direct benefit” from it. Here, as part of an

employment agreement between defendant and BGC Financial, the employer agreed to

“cause” plaintiff, a related entity, to make a loan to defendant, which would be payable if

he left the employment before expiration of the agreement’s term. The employment

agreement contained an arbitration clause, although the note agreement did not. The

Court holds that plaintiff is bound by the arbitration agreement as it “received all the

benefits that an entity ordinarily receives upon the giving of a loan [citation omitted].

Thus, BGC Notes derived benefits from the employment agreement,” and is bound by its

arbitration clause.

CONFIRMING OR VACATING THE AWARD

Matter of BMW of North America, LLC v. Burgos, 143 A D 3d 980 (2d Dept. 2016) –

“‘Under CPLR 7511, an arbitration award may be vacated only if (1) the rights of a party

were prejudiced by corruption, fraud or misconduct in procuring the award, or by the

partiality of the arbitrator; (2) the arbitrator exceeded his or her power or failed to make a

final and definite award; or (3) the arbitration suffered from an unwaived procedural

defect’ [citations omitted]. Where, as here, parties are subject to compulsory arbitration,

the award must satisfy an additional layer of judicial scrutiny – it must have evidentiary

support and cannot be arbitrary and capricious.”

Daesang Corporation v. The NutraSweet Company, N.Y.L.J., 1202788875727 (Sup.Ct.

N.Y.Co. 2017)(Ramos, J.) – “An award may be vacated under federal law only if it

violates a ground set forth in Section 10 of the Federal Arbitration Act (“FAA”) [citation

omitted]. In addition to the grounds set forth in the FAA, a court may vacate an

arbitration award ‘if it was rendered in manifest disregard of the law’ [citation omitted].


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A court must determine whether ‘the arbitrators knew of a governing legal principle yet

refused to apply it or ignored it altogether,’ and whether the governing law ignored was

‘well defined, explicit, and clearly applicable to the case’ [citation omitted]. Merely an

error or misunderstanding of the applicable law does not constitute manifest disregard

[citation omitted]. Judicial review of arbitration awards is extremely limited [citation

omitted]. An arbitration award must be upheld when the arbitrator ‘offers even a barely

colorable justification for the outcome reached.’”

Matter of Kirchhoff-Consigli Construction Management, LLC v. Mechtronics

Corporation, 144 A D 3d 682 (2d Dept. 2016) – “A party seeking to overturn an

arbitration award on one or more grounds stated in CPLR 7511(b)(1) bears a heavy

burden [citations omitted]. That party must establish a ground for vacatur by clear and

convincing evidence [citations omitted]. An award is irrational only where there is no

proof whatever to justify the award.”

Country-Wide Insurance Co. v. TC Acupuncture, P.C., 140 A D 3d 643 (1st Dept. 2016)

– “Supreme Court erred in vacating the master arbitrator’s award on the ground that the

master arbitrator mistakenly applied the wrong burden of proof to petitioner’s Mallela

defense. Even assuming, without deciding, that that the master arbitrator applied the

wrong burden of proof, the award is not subject to vacatur on that ground.”

Matter of Isernio v. Blue Star Jets, LLC, 140 A D 3d 480 (1st Dept. 2016) – “In

concluding that the arbitrator had failed to consider a contractual provision and by

drawing its own factual and legal determinations, the motion court exceeded its statutory

power of review.”

Matter of City of Buffalo (Buffalo Police Benevolent Association, Inc.), 150 A D 3d 1641

(4th Dept. 2017) – After a Buffalo police officer confessed to operating a “marijuana

‘grow operation,’” the Commissioner served charges on him and promptly terminated his

employment prior to holding a disciplinary hearing. The Collective Bargaining

Agreement provides that a disciplinary penalty may only be imposed “after a hearing

upon stated charges.” Upon the grievance filed by respondent, the arbitrator concluded

that “petitioner had violated the ‘very clear procedure’ delineated in the CBA and

awarded the officer back pay.” The Court concludes “that petitioner failed to meet its

‘heavy burden’ of demonstrating that the award should be vacated” on “public policy”

grounds. For, “a court may vacate an award on that ground ‘where strong and well-

defined policy considerations embodied in constitutional, statutory or common law

prohibit a particular matter from being decided or certain relief from being granted by an

arbitrator’ [citations omitted]. Vacatur of an award may not be granted ‘on public policy

grounds when vague or attenuated considerations of a general public interest are at stake’

[citation omitted]. The court [below] properly determined that petitioner’s proffered

public policy considerations do not preclude the relief granted by the arbitrator.


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Petitioner’s arguments in that regard constitute little more than vague considerations of a

general public interest, which are insufficient to support vacatur of an award [citations

omitted]. Although the underlying facts make the size of the award distasteful – over two

years of back pay for a police officer who allegedly confessed to committing crimes both

before and after becoming a police officer – ‘our public policy analysis cannot change

because the facts or implications of a case might be disturbing, or because an employee’s

conduct is particularly reprehensible.”

Matter of O’Flynn (Monroe County Deputy Sheriff’s Association, Inc.), 141 A D 3d 1097

(4th Dept. 2016) – The arbitration agreement contained in the relevant Collective

Bargaining Agreement provided that an arbitrator “shall review the record of the

disciplinary hearing and determine if the finding of guilt was based upon clear and

convincing evidence.” But, here, “at arbitration the arbitrator found that certain evidence,

including the chemical test results measuring [the deputy sheriff’s] blood alcohol content

at .18%, was inadmissible.” Accordingly, the arbitrator dismissed charges that had been

sustained by the hearing panel, and reduced the penalty imposed. The Court affirmed the

vacatur of the award. “Rather than comply with [the CBA’s] mandate and review the

record from the hearing, the arbitrator considered a portion of the record only, deciding to

exclude certain evidence from the review. Having failed to review that which he was

required to review, the [Supreme] court properly concluded that the arbitrator exceeded

his authority and vacated the arbitration award.”

Matter of Piller v. Schwimmer, 135 A D 3d 766 (2d Dept. 2016) – “Pursuant to CPLR

7511(b)(1)(ii), an arbitration award may be vacated if the rights of a party were

prejudiced by the partiality of the arbitrator [citation omitted]. An arbitrator designated

by parties to a private contract may have a preexisting business or social relationship with

a party to the contract, and that fact, without more, is not sufficient to disqualify the

arbitrator – particularly where that relationship is known by the ‘other side’ [citation

omitted]. Indeed, if the parties so agree, the relationship of an arbitrator to the party

selecting the arbitrator or to the matters in dispute will not disqualify the arbitrator

[citation omitted]. Thus, where a party becomes aware of a relationship between an

arbitrator and the other party or to the matters in dispute that could lead to bias, if the

party continues to participate in the arbitration, the party has waived his or her right to

object to the award on this ground.”

A&L Village Market, Inc. v. 344 Village, Inc., 140 A D 3d 804 (2d Dept. 2016) – “The

arbitrator should have disclosed to the parties that he had been the arbitrator in a prior

unrelated proceeding in which [defendant] Vested was a party [citation omitted].

Although the seller’s attorney learned of the prior arbitration from the brokers’ attorney a

week after the hearing, the seller continued to actively participate in the arbitration

process without raising any objection to the arbitrator. Under these circumstances, the

seller waived any claims related to the alleged partiality of the arbitrator [citations


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omitted]. In any event, the seller failed to establish that the prior arbitration had any

effect upon the arbitrator’s ability to be neutral in the instant matter.”

Matter of Pinkesz v. Wertzberger, 139 A D 3d 1071 (2d Dept. 2016) – The parties agreed

to arbitrate their dispute before a rabbinical court. “In an arbitration award dated May 5,

2011, the rabbinical court, inter alia, directed Wertzberger to pay Pinkesz the sum of

$425,000. In an arbitration award dated July 22, 2013, the rabbinical court, based upon

new information, directed Wertzberger to pay Pinkesz the sum of $3,750,000 regarding

the same dispute.” The Court affirms the vacatur of the later award. “After an arbitrator

renders an award, he or she is generally without power to render a new award or to

modify the original award [citations omitted]. Here, because the arbitration award dated

May 5, 2011 was final and definite within the meaning of CPLR 7511 [citations omitted],

the rabbinical court exceeded its authority in modifying the original award by rendering

the new arbitration award dated July 22, 2013.”

Matter of Woods v. State University of New York, 149 A D 3d 1358 (3d Dept. 2017) –

“‘An arbitrator’s authority extends to only those issues that are actually presented by the

parties. Thus, an arbitrator may not reconsider an award – regardless of whether the

request is couched as a clarification or modification – if the matter was not previously

raised in arbitration.”

ENFORCEMENT OF JUDGMENTS

Pensmore Investments, LLC v. Gruppo, Levey & Co., 137 A D 3d 558 (1st Dept. 2016) –

Plaintiff-judgment creditor of Hugh Levey seeks to enforce the judgment against personal

property in premises he once shared with his estranged wife Wendy Levey, and which

she now occupies. “We agree with Wendy that because Hugh was not in physical

possession of the property which is the subject of the turnover order, the enforcement

proceeding should have been brought as a special proceeding pursuant to CPLR 5225(b).

Wendy was required to have been named as a party and separately served with the

petition, because she is the one in actual possession of the disputed property [citations

omitted]. Although Pensmore did not properly name Wendy, the error could have been

cured by permitting Wendy to intervene, so long as the burden of proof remained on the

judgment creditor (Pensmore) to establish that the judgment debtor (Hugh) has an interest

in the property that is superior to the person in actual possession (Wendy).”

New York State Commissioner of Taxation and Finance v. TD Bank, N.A., 55 Misc 3d

395 (Sup.Ct. Albany Co. 2016)(Hartman, J.) – CPLR 5225(b) provides that when a

judgment creditor commences a turnover proceeding against a person in possession of

property owned by the judgment debtor, the judgment debtor must be served “in the same

manner as a summons or by registered or certified mail, return receipt requested.” The


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Court here rules that “certified mailing, return receipt requested, does not satisfy the

service requirement of CPLR 5225(b) unless the completed and signed return receipt or

other evidence shows actual delivery to a suitable person at the debtor’s last known

address.” For, “if service were deemed successfully completed by the mere mailing of

notice with a request for return receipt, regardless of whether the return receipt shows

that the notice was delivered, the requirement for a return receipt would serve no purpose,

and notice could as effectively be served by first-class mail [citations omitted]. CPLR

5225(b) contemplates that the judgment debtor may intervene. Compliance with the

return receipt requirement is necessary to ensure that the judgment debtor has reasonable

notice and the opportunity to seek intervention in the turnover proceeding. Due process

requires as much.”

Matter of Sirotkin v. Jordan, LLC, 141 A D 3d 670 (2d Dept. 2016) – The judgment

creditor here sought an order, pursuant to CPLR 5225(b), directing respondent LLC to

turn over the judgment debtor’s interest in it. Supreme Court granted the petition only to

the extent of entering an order, pursuant to Limited Liability Company Law §607,

charging the judgment debtor’s membership interest in the LLC with payment of the

amount of the judgment. The Appellate Division affirms. “Under CPLR 5201(b), ‘a

money judgment may be enforced against any property which could be assigned or

transferred, whether it consists of a present or future right or interest and whether or not it

is vested.’ 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 ‘except as provided in the operating agreement a membership interest

is assignable in whole or in part’ [citation omitted]. 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

[judgment debtor] 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, limited, 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 ‘to 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.”


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Matter of Agai v. Diontech Consulting, Inc., 138 A D 3d 736 (2d Dept. 2016) – “Equity

will intervene to pierce the corporate veil and permit the imposition of individual liability

on owners for the obligations of their corporations in order to avoid fraud or injustice

[citation omitted]. A party seeking to pierce the corporate veil must establish that (1) the

owners exercised complete domination of the corporation with respect to the transaction

at issue, and (2) such domination was used to commit a fraud or wrong against the party

seeking to pierce the corporate veil which resulted in the injury to that party [citations

omitted]. The decision whether to pierce the corporate veil in a given instance will

depend on the circumstances of the case.” Here, petitioners established a prima facie

entitlement to piercing the corporate veil “by submitting evidence showing, inter alia,

that the appellants dominated Diontech, that Diontech did not adhere to any corporate

formalities such as holding regular meetings and maintaining corporate records and

minutes, that the appellants used corporate funds for personal purposes, and that the

appellants stripped Diontech of assets as they wound down the business, leaving it

without sufficient funds to pay its creditors, including the petitioners.”

Jackson v. Bank of America, N.A., 149 A D 3d 815 (2d Dept. 2017) – “Insofar as is

relevant here, CPLR 5222(i), which is entitled, ‘Effect of restraint on judgment debtor’s

banking institution account,’ provides that a restraining notice ‘shall not apply to an

amount equal to or less than $1,740 at the time the subject accounts were restrained

except such part thereof as a court determines to be unnecessary for the reasonable

requirements of the judgment debtor and his or her dependents’ [citation omitted]. It

further provides that if an ‘account contains an amount equal to or less than 90% of

$1,740 at the time the subject accounts were restrained, the account shall not be

restrained and the restraining notice shall be deemed void, except as to those funds that a

court determines to be unnecessary for the reasonable requirements of the judgment

debtor and his or her dependents.’” In this action seeking damages for improper restraint

of bank accounts, “the plaintiffs, pointing to the Legislature’s use of the term ‘account’ in

the singular in CPLR 5222(i), contend that CPLR 5222(i) should be applied separately to

each account. Therefore, the plaintiffs urge, even though the total balance of their

respective bank accounts was greater than $1740, BOA could not lawfully restrain any of

their accounts that contained 90% of $1,740 or less and the first $1740 of each of their

accounts containing over $1,740 was exempt from restraint or execution. BOA, pointing

to the Legislature’s use of the phrase ‘amount equal to or less than $1,740’ in the statute,

contends that the total amount in restrained bank accounts must be aggregated to

calculate the statutory exemption.” Finding the language of the statute ambiguous “as to

whether it applies to an ‘amount’ on deposit at a bank or to each ‘account’ maintained at

a bank,” the Court turns to the legislative history of the statute. And, “the legislative

history, as reflected in the bill jacket, particularly in a letter in support of the bill written

by the bill’s Assembly sponsor, Helene Weinstein, indicates that the statute applies to

each account.”


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Benzemann v. Citibank N.A., 149 A D 3d 586 (1st Dept. 2017) – “This case arises from

the retraining notices issued by defendants and the resulting restraints placed on

plaintiff’s bank accounts in 2008 and 2011.” Plaintiff’s claims for “wrongful

attachment” are dismissed. Those claims allege “that the defendants were collectively

responsible for plaintiff’s property being wrongfully restrained.” But, “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. ‘There 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.”

Northern Leasing Systems, Inc. v. Wells Fargo Bank, N.A., 51 Misc 3d 954 (Civ.Ct.

N.Y.Co. 2016)(Goetz, J.) – “A restraining notice [pursuant to CPLR 5222] ‘is just an

enforcement device, and it is deemed an adjunct of the action that gave rise to the

judgment and bears the caption of that action’ [citation omitted]. Therefore, the court

holds that where, as here, a judgment creditor seeks leave to serve an additional

restraining notice under CPLR 5222(c), the judgment creditor is not permitted to request

such leave by way of a special proceeding pursuant to CPLR article 4. Instead the

judgment creditor must seek leave to serve its additional restraining notice pursuant to

CPLR 5222(c) by bringing a motion in the underlying action giving rise to the

judgment.”

Southern Chautauqua County Federal Credit Union v. Moore, 54 Misc 3d 285 (Sup.Ct.

Chautauqua Co. 2016)(Sedita, J.) – “Debtors’ prisons were banned under federal law in

1833.” However, “there are some circumstances, albeit extremely limited ones, when the

deprivation of a citizen’s liberty is permissible in the course of civil litigation. A finding

of contempt is the most common example.” And, “pursuant to CPLR 5224(3)(iv), failure

to comply with an information subpoena is governed by CPLR 2308. Pursuant to CPLR

2308(a), failure to comply with a subpoena is punishable as a contempt. Pursuant to

CPLR 2308(b), the court ‘may’ issue a warrant (i.e., warrant issuance lies with the court’s

discretion) directing the sheriff to bring the alleged contemnor before the court.” Here,

the judgment creditors’ request that the judgment debtors be arrested for failure to

comply with an information subpoena is denied. For “although there is sufficient proof

to support the claim that legal documents were mailed to defendants’ last known

addresses, there is no proof that any of the defendants actually received and read the

information subpoena, the questionnaire, the notices of motion or any contempt

warnings.” And, “mailing alone is insufficient to prove the required element of

knowledge by clear and convincing evidence and plaintiffs fail to meet their burden in the

absence of additional proof that the information subpoena was signed for by the named

defendant or actually received by the named defendant.” In sum, “before sanctioning an

enterprise better suited for the Sheriff of Nottingham than the Sheriff of Chautauqua, the

court must be assured the debtor/defendant is being knowingly contemptuous. The court

is not.”


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[email protected]

229 NY 76592344v1

George v. Albi, 148 A D 3d 1119 (2d Dept. 2017) – “CPLR 5240 provides the court with

broad discretionary power to control and regulate the enforcement of a money judgment

under CPLR article 52 to prevent ‘unreasonable annoyance, expense, embarrassment,

disadvantage or other prejudice’ [citation omitted]. Nevertheless, an application to quash

a subpoena should be granted only where ‘the futility of the process to uncover anything

legitimate is inevitable or obvious [citation omitted], or where the information sought is

‘utterly irrelevant to any proper inquiry’ [citations omitted]. It is the burden of the party

seeking to quash a subpoena to conclusively establish that it lacks information to assist

the judgment creditor in obtaining satisfaction of the judgment.”

Morin Boats v. Acierno, 150 A D 3d 844 (2d Dept. 2017) – “The Full Faith and Credit

Clause requires that a New York court afford the judgment of a sister State the same

credit, validity, and effect that it would have in the State that rendered it [citations

omitted]. Where, as here, the out-of-state judgment was entered upon default, the

plaintiff may proceed pursuant to CPLR 3213 for summary judgment in lieu of

complaint.”

Cerrato v. Peter T. Roach & Associates, P.C., 51 Misc 3d 39 (App.Term 2d Dept. 2016)

– Last year’s “Update” reported on the District Court’s decision in this action [N.Y.L.J.,

1202638796049 (Dist.Ct. Nassau Co. 2014)]. The District Court held that, “New York

courts will not domesticate a default judgment entered in a sister state where the sister

state did not have personal jurisdiction over the defendant.” Here, the Connecticut

plaintiff sued the New York law firm defendant in Connecticut for having made

“numerous and persistent telephone calls on her cell phone, at home and at her place of

employment” in an attempt “to collect the money alleged to be owed” to defendant’s

client, Citibank, in violation of the Federal Fair Debt Collection Practices Act. The

District Court held that although Connecticut’s long arm statute reaches to the limits of

due process, it does not grant jurisdiction on these facts. “In order for an out-of-state

attorney to be subject to the jurisdiction of the courts in Connecticut, the attorney must

engage in more than simply communicating with a Connecticut resident.” Additionally,

“traditional notions of fair play and substantial justice establish a New York State law

firm is not subject to the jurisdiction of the courts of another state relating to activities

performed in New York. If Cerrato’s premise is accepted by this Court, then any New

York attorney who makes a business related telephone call into another state would be

subject to the jurisdiction of that state. This court concludes Roach’s conduct is

insufficient both on a transaction of business basis or on a substantial justice basis to

subject it to the jurisdiction of the courts of Connecticut. Therefore, the judgment entered

in favor of Cerrato cannot be domesticated in New York.” The Appellate Term has

affirmed. For, “under Connecticut law, telephone contacts, standing alone, are generally

considered jurisdictionally insufficient to establish long-arm jurisdiction over a foreign

defendant, unless the defendant by those means purposefully avails itself of the benefits

and protections of Connecticut’s laws.” Here, “we conclude that the District Court


Burton N. Lipshie


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230 NY 76592344v1

correctly found that defendant had not engaged in sufficient purposeful activity in

Connecticut to be subject to jurisdiction under the transaction of business branch of

Connecticut’s long-arm statute.” Thus the Court did not reach the question whether the

exercise of jurisdiction over defendant would comport with constitutional mandates, nor

whether jurisdiction would be available under “the tort branch of the Connecticut long-

arm statute.”