Month: November 2009

CPLR R. 3117 and the Missing Witness Charge

CPLR R. 3117 Use of depositions
(a) Impeachment of witnesses; parties; unavailable witness
(4)  the deposition of a person authorized to practice medicine may be used by any party without the necessity of showing unavailability or special circumstances, subject to the right of any party to move pursuant to section 3103 to prevent abuse

Lauro v City of New York, 2009 NY Slip Op 08186 (App. Div., 2nd, 2009)

Additionally, contrary to the defendants' contentions, the Supreme Court properly gave a missing witness instruction (see Taveras v Martin, 54 AD3d 667; Brown v City of New York, 50 AD3d 937). " [W]hen a doctor who examines an injured plaintiff on the defendant's behalf does not testify at trial, an inference generally arises that the testimony of such witness would be unfavorable to the defendant. The defendant may defeat this inference by demonstrating that the testimony would be merely cumulative, the witness was unavailable or not under the defendant's control, or the witness would address matters not in dispute'" (Hanlon v Campisi, 49 AD3d 603, 604, quoting Brooks v Judlau Contr., Inc., 39 AD3d 447, 449, revd 11 NY3d 204). Here, the defendants failed to defeat the inference (see Taveras v Martin, 54 AD3d 667; Brown v City of New York, 50 AD3d 937).

How do you go about getting the charge.  Taveras is instructive,

The Supreme Court did not err in granting the defendant's request for a missing-witness charge for Leo F. Taveras. A party seeking a missing-witness charge must "promptly notify the court that there is an uncalled witness believed to be knowledgeable about a material issue pending in the case, that such witness can be expected to testify favorably to the opposing party and that such party has failed to call him to testify" (People v Gonzalez, 68 NY2d 424, 427 [1986]). As the party opposing the missing-witness charge, the appellant failed to demonstrate that Leo F. Taveras was "unavailable, not under [his] control, or that [his] testimony would be cumulative" (Adkins v Queens Van-Plan, 293 AD2d 503, 504 [2002]). Leo F. Taveras was the operator of the vehicle in which the appellant was a passenger and he is also the appellant's brother. Thus, it is clear that Leo F. Taveras is favorably disposed to the appellant and under his control (see People v Marsalis, 22 AD3d 866, 868-869 [2005]). The appellant failed to demonstrate that Leo F. Taveras remained ill after his hospital release or was otherwise unavailable (compare People v Turner, 294 AD2d 192 [2002]).

And bringing it on home is Brown,

Contrary to the defendants' contention, the Supreme Court properly granted the plaintiffs' request for a missing witness charge with respect to the defendant Julio A. Torro, the driver of the vehicle that allegedly struck the van of the injured plaintiff Joe S. Brown. Torro, who at all relevant times was represented by counsel, and who had previously given deposition testimony, inexplicably failed to appear at the trial to testify. A jury may, but is not required to, draw the strongest inference that the opposing evidence permits against a party who fails to testify at trial (see Crowder v Wells & Wells Equip., Inc., 11 AD3d 360, 361 [2004]; Farrell v Labarbera, 181 AD2d [*2]715, 716 [1992]; see also Noce v Kaufman, 2 NY2d 347, 353 [1957]).
What happens in cases where a party takes the testimony of a non-treating doctor, perhaps a IME doctor or a peer review doctor, and uses that deposition at trial under CPLR R. 3117(a)(4)?  And assume the doctor is available to testify.  And of course, unavailable doesn't mean that the doctor might have something better to do that day.  What then?  Get your missing witness charge (PJI 1:75).  To sort of conclude:  Can you use the deposition?  Probably.  Can the other side get a missing witness charge?  Probably.  The next question is:  Is it worth it?  I'll get into that in a minute.

*intermission* Or, for the few no-fault types who read this blog, consider the case of the re-peer. */intermission*

A couple of months ago I tried to do some research on 3117(a)(4).  I was more or less trying to understand the impetus behind the provision.  As it turns out, I'm terrible at researching this.  I had a research librarian trying to help me out and I really couldn't get anything on it.  That said, I'm pretty sure it is a patient treating mechanism, not a money saving mechanism.  The only reason to have a rule that allows for doctors' depositions to be used at trial is to keep them out of court and in their offices, treating patients.  Lately, a few insurance companies have been using it as a money saving mechanism.  Have one doctor in their (ins co lawyer's) office all day doing depositions for various cases–the doctors get paid a fixed (lower) rate, and the insurance companies don't have to pay the doctors to appear at trial.  At trial, the insurance company lawyer reads the deposition into the record.  There is no doubt that CPLR R. 3117(a)(4) is being used as a money saving mechanism.  From experience, I can tell you that the doctors are available to testify.  There are days where they are in court to testify on over five cases for various insurers.  Do I blame them?  No, everyone needs to make a living. The point is, they aren't treating patients.  The depositions aren't allowing them to treat more patients.  They still come to court and testify on cases where depositions weren't held.

Like I said, and I could be wrong (but I doubt it) CPLR R. 3117(a)(4) was not intended to be a money saving mechanism.

Finally, and I alluded to this before, is this something a party really wants to do?  Depositions are a completely different animal than trials.  It's part of discovery.  Accordingly, there is a lot of leeway.  All those questions that you could never get away with at trial; you can ask them.  If the insurance company refuses to allow their doctor to answer and bust the deposition, well, that will be their problem.  Th
ere is a lot of interplay between IME doctors, Peer Review doctors, the vendors that work in-between the doctors and the insurance companies, and the insurance companies.  Do you really want these questions asked?  Do you want the answers memorialized?  I'd guess no.  But, I could always be wrong.  In the end, it could wind up costing far more than it would save.

Finally, using this rule is a ballsy move.  One that most parties wouldn't make but for desperation.  We can all agree that a jury wouldn't like it.  Would a Judge?  Would anyone feel comfortable telling the trier of fact, especially one that went to law school, and one who is smarter than your average Joe that, "Yes your honor, I didn't think it important that you see the witness.  No, you don't have to worry about the witness' demeanor.  It's fine, trust me".  And if the other side asked for a missing witness charge, how would you respond?

Something to think about.

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CPLR § 3218(b) Judgment by confession not filed within 3 years

CPLR § 3218 Judgment by confession

Shasho v Pruco Life Ins. Co. of N.J., 2009 NY Slip Op 08000 (App. Div., 2nd, 2009)

The plaintiff seeks a preliminary injunction based, in part, on her
contention that the confession of judgment was obtained in connection
with a usurious promissory note. "No law regulating the maximum rate of
interest which may be charged, taken or received shall apply to any
loan or forebearance in the amount of two million five hundred thousand
dollars or more" (General Obligations Law § 5-501[6][b]). Thus, the
plaintiff failed to establish a likelihood of success on her claim that
a promissory note that she and her late husband executed in favor of
the defendant, and upon which the confession of judgment was
predicated, is usurious, as the face of the note provides that the
amount owed was $3,500,000 (see General Obligations Law 5-501[6][b]; Tides Edge Corp. v Central Fed. Sav., 151 AD2d 741; see also Ujueta v Euro-Quest Corp., 29 AD3d 895; Hochman v LaRea, 14
AD3d 653, 654). Moreover, the confession of judgment was signed and
notarized on December 31, 2005, and, thus, at the time that the Supreme
Court determined that branch of plaintiff's motion which was for a
preliminary injunction, the three-year period for filing the confession
of judgment (see CPLR 3218[b]) had yet to lapse. Consequently,
the Supreme Court properly denied that branch of the plaintiff's motion
which was for a preliminary injunction enjoining the defendant from
entering, filing, and enforcing the confession of judgment. Further,
the Supreme Court properly permitted the release of the proceeds from
certain life insurance policies to the defendant.

Nonetheless, the defendant failed to file the confession of
judgment by December 31, 2008, and thus failed to file it within three
years after the plaintiff's affidavit of confession was executed.
Accordingly, the confession of judgment became void after that date (see CPLR 3218[b]; Ray v Ray, 61
AD3d 442, 443). Thus, in the order dated March 12, 2009, the Supreme
Court erred in granting that branch of the defendant's application
which was, in effect, to permit him to enter, file, and enforce the
confession of judgment.

The bold is mine

UPDATE (after argument): SCOTUS grants cert on CPLR § 901(b) issue

The Civil Procedure & Federal Courts Blog is on top of it.  The SCOTUS blog is all over it as well.

I posted about this case a little while ago here  and it was in the NYLJ Wrap-Up. I’m sure you’ve been wondering about it. I have.

You can read the transcript HERE.
Or, if you don’t want to get it from me, you can go over to The Civil
Procedure & Federal Courts Blog, and get it from them.

This post is a work in progress.  There will be additions and commentary as I continue to review the case and receive (or find) additional information.

CPLR 901(b) Unless a statute creating or imposing a penalty, or a minimum measure
of recovery specifically authorizes the recovery thereof in a class
action1, an action to recover a penalty, or minimum measure of recovery
created or imposed by statute may not be maintained as a class action.

FRCP 23 Class Actions

The Supreme Court of the United States recently granted cert in Shady Grove Orthopedic Associates, P.A. v. Allstate Ins. Co., 129 S.Ct. 2160, 173 L.Ed.2d 1155, 77 USLW 3472, 77 USLW 3605, 77 USLW 3609 (U.S. May 04, 2009) (NO. 08-1008).  It made its way there through the Eastern District (466 F.Supp.2d 467) and the Second Circuit Court of Appeals (549 F.3d 137)

What's this all about? 

The short version:

Shady Grove (a Maryland corporation) brought a class action against Allstate (a Illinois corporation)  in Federal court suing for interest that is overdue from no-fault claims.  The underlying lawsuit involved a New York policy.  Those claims were paid, but for the interest.  Shady Grove argued that it could get into Federal Court through 28 U.S.C. § 1332(d)(2)(A), which gives the federal courts original jurisdiction in a class action where the amount in controversy is more that five-million dollars and diversity exists, and FRCP 23 allows class certification.

Allstate moved to dismiss, arguing that because interest is a "penalty", CPLR § 901(b) expressly prohibits such a class action2 and that because CPLR § 901(b) is a substantive rule, the Federal Court must apply it. Shady Grove argued that (1) it is a procedural rule and it is in conflict with FRCP 23 (the federal equivalent of CPLR § 901), which contains no identical or similar restriction;  (2) because it is a procedural rule, an Erie3 analysis requires that the Federal Court apply its own rule; and (3) it argued that the "unless clause" (see FN 1) of CPLR § 901(b) permits the lawsuit, even if the court finds it to be a substantive rule.

The district court agreed with Allstate and dismissed the action. It found that CPLR § 901(b) is substantive and therefore does not invoke either the Supremacy Clause4 or Erie.  Without class certification, Shady Grove was unable to maintain diversity jurisdiction.

At the Second Circuit, Shady Grove added an argument5 (a request really) in its reply brief; that the Court should certify the following question to the New York Court of Appeals: whether the interest provision is a "penalty within the meaning of CPLR § 901(b)."  The Second Circuit, upon Allstate's motion, struck that portion of the brief, because it should have been brought up in the initial brief.

The Second Circuit discussed each of Shady Grove's arguments.

The Court first addressed the Erie situation.  It found that FRCP 23 does not conflict with CPLR § 901(b); that there is no "direct collision" with § 901.  It reasoned that, because FRCP 23 does not determine which actions can or cannot be brought, "it leaves room for the operation of § 901(b)," finding it to be a substantive rule. 

But would the application of CPLR § 901(b) "serve the twin aims6 of Erie?  The Court answered in the affirmative. Not applying the rule would, according to the Court, encourage plaintiff' to file in the Federal Courts, rather than in New York.  And it would allow them to recover in Federal Court, when they could not in New York.

The Court then discussed Shady Grove's argument that under N.Y. Ins. Law § 5106(a)7 the lawsuit can be maintained via class action because 11 NYCRR § 65-3.9(c)8 contemplated class actions in this context, and therefore satisfies the exception clause of CPLR § 901(b).  In rejecting this argument, the Court found that § 65-3.9(c) did not specifically authorize9 class actions.  "At most,[the] regulation contemplates the recovery of a penalty in a class action."

The "questions presented" in the petition for cert are:

1. Can a state legislature properly prohibit the federal courts from using the class action device for state
law claims?

2. Can state legislatures dictate procedure in the federal courts?

3. Could state-law class actions eventually disappear altogether, as more state legislatures declare them offlimits to the federal courts?

——————-

1.  This is the unless clause.

2.  "…an action to recover a penalty, or minimum measure of recovery
created or imposed by statute may not be maintained as a class action."  CPLR § 901(b)

3. 
Erie Railroad Co. v. Tompkins, 304 U.S. 64 (1938).  Under Erie, when a Federal Court sits in diversity jurisdiction, it must apply a states substantive law and the federal procedural law.  It's more complicated than it seems.  More information can be found on the case and the issue on wikipedia.

4. U.S. Const. art. VI, Cl. 2

This Constitution, and the Laws of the United States which shall be
made in Pursuance thereof; and all Treaties made, or which shall be
made, under the Authority of the United States, shall be the supreme
Law of the Land; and the Judges in every State shall be bound thereby,
any Thing in the Constitution or Laws of any State to the contrary
notwithstanding.

5. Shady Grove cited to Sperry v. Crompton Corp., 8 N.Y.3d 204 (Ct. App., 2007) in support of its request for certification.

6. (1) to discourage forum shopping and (2) inequitable administration of the laws.

7. § 5106(a) provides:

(a)
Payments of first party benefits and additional first party benefits
shall be made as the loss is incurred. Such benefits are overdue if not
paid within thirty days after the claimant supplies proof of the fact
and amount of loss sustained. If proof is not supplied as to the entire
claim, the amount which is supported by proof is overdue if not paid
within thirty days after such proof is supplied. All overdue payments
shall bear interest at the rate of two percent per month. If a valid
claim or portion was overdue, the claimant shall also be entitled to
recover his attorney's reasonable fee, for services necessarily
performed in connection with securing payment of the overdue claim,
subject to limitations promulgated by the superintendent in regulations.

8. § 65-3.9(c) provides:

(c) If
an applicant does not request arbitration or institute a lawsuit within
30 days after the receipt of a denial of claim form or payment of
benefits calculated pursuant to Insurance Department regulations,
interest shall not accumulate on the disputed claim or element of claim
until such action is taken. If any applicant is a member of a class in
a class action brought for payment of benefits, but is not a named
party, interest shall not accumulate on the disputed claim or element
of claim until a class which includes such applicant is certified by
court order, or such benefits are authorized in that action by
Appellate Court decision, whichever is earlier. (emphasis added)

9.  The Court is referring to this portion of CPLR § 901(b) (which is quoted in its entirety at the top of this post): "Unless a statute creating or imposing a penalty, or a minimum measure
of recovery specifically authorizes the recovery thereof in a class
action." (emphasis added).  See FN 1.

Forum Non Con: CPLR R. 327

CPLR R. 327 Inconvenient forum

Tiger Sourcing (HK) Ltd. v GMAC Commercial Fin. Corporation-Canada, 2009 NY Slip Op 07828 (App. Div., 2nd, 2009)

CPLR 327 "permits a court to stay or dismiss such actions where it is determined that the action, although jurisdictionally sound, would be better adjudicated elsewhere" (Islamic Republic of Iran v Pahlavi, 62 NY2d 474, 478-479, cert denied 469 US 1108). The defendant bears the burden in a motion to dismiss on the ground of forum non conveniens to "demonstrate relevant private or public interest factors which militate against accepting the litigation" (id.). On such a motion, the Supreme Court is to weigh the parties' residencies, the location of the witnesses and any hardship caused by the choice of forum, the availability of an alternative forum, the situs of the action, and the burden on the New York court system (see Prestige Brands, Inc. v Hogan & Hartson, LLP, 65 AD3d 1028; Turay v Beam Bros. Trucking, Inc., 61 AD3d 964, 966). No one factor is dispositive (see Turay v Beam Bros. Trucking, Inc., 61 AD3d at 966; Brinson v Chrysler Fin., 43 AD3d 846, 848). The Supreme Court's determination should not be disturbed unless the court improvidently exercised its discretion or failed to consider the relevant factors (see Smolik v Turner Constr. Co., 48 AD3d 452, 453-454; Brinson v Chrysler Fin., 43 AD3d at 848).

Under the circumstances of this case, the Supreme Court providently exercised its discretion in granting that branch of the defendants' joint motion which was to dismiss the complaint on the ground of forum non conveniens (see Islamic Republic of Iran v Pahlavi, 62 NY2d 474; Prestige Brands, Inc. v Hogan & Hartson, LLP, 65 AD3d 1028; Turay v Beam Bros. Trucking, Inc., 61 AD3d 964; Smolik v Turner Constr. Co., 48 AD3d 452; Stravalle v Land Cargo, Inc., 39 AD3d 735, 736).

The bold is mine.

Post Appeal Motion to Renew: CPLR R. 2221(e)

CPLR R. 2221(e) Motion for Leave to Renew

Estate of Anna K. Essig v 5670 58 St. Holding Corp., 2009 NY Slip Op 07581 (App. Div., 2nd, 2009)

On prior appeals, this Court, inter alia, affirmed an order granting that branch of the plaintiffs' prior motion which was for summary judgment on their cause of action for a judgment declaring that they are the owners of 225 shares of the capital stock of the defendant 5670 58 Street Holding Corp. and affirmed an order denying the respondents' prior motion for leave to renew their opposition to that branch of the plaintiffs' prior motion (see Estate of Essig v 5670 58 St. Holding Corp., 50 AD3d 948). Thereafter, the respondents moved again for leave to renew based upon documents discovered four months earlier. The Supreme Court granted the motion and, upon renewal, vacated the judgment entered August 7, 2008, and denied that branch of the plaintiffs' prior motion which was for summary judgment on their declaratory judgment cause of action. We reverse.

Pursuant to CPLR 2221(e), 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" (CPLR 2221[e][2],[3]). Moreover, while "a court of original jurisdiction may entertain a motion to renew or to vacate a prior order or judgment on the ground of newly discovered evidence even after an appellate court has affirmed the original order or judgment . . . on [a] postappeal motion [to renew] the [movant] bears a heavy burden of showing due diligence in presenting the new evidence to the [*2]Supreme Court in order to imbue the appellate decision with a degree of certainty" (Levitt v County of Suffolk, 166 AD2d 421, 422-423 [citations omitted][emphasis added]). Here, the respondents failed to offer a reasonable explanation for their failure to present the "new facts" in conjunction either with their opposition to that branch of the plaintiffs' prior motion which was for summary judgment on their declaratory judgment cause of action or with their first motion for leave to renew (see Elder v Elder, 21 AD3d 1055; Renna v Gullo, 19 AD3d 472, 473). Accordingly, the respondents' motion for leave to renew should have been denied.

The bold is mine.

It’s almost impossible to wiggle your way out of a stipulation–CPLR R. 2104

Far more parties are finding their stipulations to be oppressive than in the past few months.  I guess that's not true, but there are more appellate decisions on the issue than there have been in the past few months.  And that's close enough for me.  One of the benefits of blogging is that I have the opportunity to notice patterns in appellate law as it develops.  Eventually I hope to see one.  But for now, I'll keep on noting the obvious.  And hopefully, having made you read this, I've made you a little dumber than you were before.  You're welcome.

CPLR R. 2104 Stipulations

ABA Consulting, LLC v Liffey Van Lines, Inc., 2009 NY Slip Op 07923 (App. Div., 1st, 2009)

Next, defendant urges that the settlement agreement should be
vacated on the ground of mutual mistake, arguing that the parties must
have contemplated reimbursement for tax arrears. However, while mutual
mistake may furnish grounds for vacating a written agreement, there is
a " heavy presumption that a deliberately prepared and executed written
instrument manifest[s] the true intention of the parties'" and the
"proponent of reformation must show in no uncertain terms, not only
that mistake or fraud exists, but exactly what was really agreed upon
between the parties'" (Chimart Assoc. v Paul, 66 NY2d 570, 574 [1986], quoting Backer Mfg. Corp. v Acme Quilting Co.,
46 NY2d 211, 219 [1978]). Defendant has not established that the
parties came to any agreement, or even contemplated the refund of
payments recouped by the taxing authorities, or that either had any
knowledge, at the time the settlement agreement was executed, that
defendant would be audited. Accordingly, the settlement agreement
cannot be vacated on the ground of mutual mistake.

Defendant next argues that the settlement agreement should be
vacated on the ground of unilateral mistake, contending that it was
induced to pay fees upon the mistaken belief that any audit reducing
its tax refunds would entitle it to a proportional refund or credit
from plaintiff. However defendant presents no evidence that plaintiff
fraudulently induced it to enter into the settlement agreement upon the
false representation that it would adjust its fees if additional taxes
were found due, as required for a finding that the contract was the
product of unilateral mistake (Rosen Auto Leasing, Inc. v Jacobs, 9 AD3d 798,
800 [2004]). In fact, the settlement agreement was an arm's length
transaction between businessmen who were represented by counsel, and
the terms of plaintiff's compensation was consistent with that set
forth in the parties original [*3]consulting agreement. We find no basis on this record for vacating that agreement (see Greater N.Y. Mut. Ins. Co. v United States Underwriters Ins. Co., 36 AD3d 441, 443 [2007]).

Dubi v Skiros Corp., 2009 NY Slip Op 07793 (App. Div., 2nd, 2009)

"Stipulations entered into in open court are favored by the courts and
are to be set aside only where there is cause sufficient to invalidate
a contract such as fraud, duress, collusion, or mistake" (Feuer v Darkanot, 36 AD3d 753, 753-754; see Ramnarain v Ramnarain, 46 AD3d 655; Hallock v State of New York, 64 NY2d 224, 230; Chernow v Chernow, 51 AD3d 705, 706; Feuer v Darkanot, 36 AD3d 753, 753-754; Desantis v Ariens Co., 17
AD3d 311). In order to vacate a stipulation on the ground of duress, a
party "must demonstrate that threats of an unlawful act compelled his
or her performance of an act which he or she had the legal right to
abstain from performing'" (Feuer v Darkanot, 36 AD3d at 754, quoting Polito v Polito, 121 AD2d 614, 614-615). "Generalized contentions that a party felt pressured by the court are insufficient" (Desantis v Ariens Co., 17 AD3d at 311; see Matter of Blackstock v Price, 51 AD3d 914; Ross v Clyde Beatty-Cole Bros. Circus, 26 AD3d 321, 322; Shuler v Dupree, 14 AD3d 548, 549; Cavalli v Cavalli, 226
AD2d 666, 667). In the present case, the record fails to support the
plaintiff's contention that the stipulation of settlement was the
product of duress.

Castellano v Castellano, 2009 NY Slip Op 07784 (App. Div., 2nd, 2009)

"Stipulations of settlement are favored by the courts and are not lightly cast aside" (Hallock v State of New York, 64 NY2d 224, 230; see Matter of Siegel, 29 AD3d 914; Shapira v Shapira, 283
AD2d 477, 478 ). "[A]n oral stipulation of settlement with respect to
property issues in a matrimonial action, if spread upon the record and
found to be fair and reasonable by the court, is not to be disturbed
absent a showing of one of the traditional' grounds for vacatur, e.g.,
fraud, duress, mistake or overreaching" (Zafran v Zafran, 28 AD3d 752, 753, quoting Harrington v Harrington, 103 AD2d 356, 359; see Korngold v Korngold, 26 AD3d 358; Leahy v Leahy, 9 AD3d 351, 352).

Applying these principles to the matter at bar, the Supreme
Court properly determined that the plaintiff failed to meet her burden
in seeking to set aside the parties' stipulation of settlement (see Dimino v Dimino, 39 AD3d 799, 800; Brennan-Duffy v Duffy, 22 AD3d 699; Jacobs v Jacobs, 234 AD2d 425), and failed to establish that the stipulation of settlement was the result of duress or [*2]overreaching on the part of the defendant (see Garner v Garner, 46 AD3d 1239, 1240; Rubin v Rubin, 33 AD3d 983, 985-986; Chambers v McIntyre, 5 AD3d 344, 345). Accordingly, the court correctly denied the motion to set aside the stipulation of settlement.

Montgomery Trading LLC v Siegel, 25 Misc 3d 128(A) (App. Term, 1st, 2009)

Civil Court properly denied tenants' motion to vacate the two-attorney, so-ordered
stipulation of settlement resolving the underlying nonpayment summary proceeding since tenants
failed to demonstrate legal cause for such relief, e.g., fraud, collusion, mistake or accident
(see Hallock v State of New York, 64 NY2d 224, 230 [1984]). The belated attempt by
tenants' incoming counsel to inject into the settled litigation an (unpleaded) rent forfeiture
defense not referenced in the stipulation does not provide a proper basis to vacate the binding
stipulation, assented to by tenants upon advice of prior counsel.

Parties should think long and hard before they enter into stipulations, because, once they do, it is extremely difficult to get out of it.  It takes more than a sad story or hindsight.  Much more. 

In some cases, what you thought was an email, might very well be a stipulation.  See, Williamson v Delsener, 2009 NY Slip Op 01333 (App. Div., 1s, 2009).  Remember that.

NTA (CPLR § 3123) and Formal Judicial Admissions

Formal Judicial Admission

CPLR § 3123(a) Notice to admit; admission unless denied or denial excused

Zegarowicz v Ripatti, 2009 NY Slip Op 08004 (App. Div., 2nd, 2009)

Facts admitted by a party's pleadings constitute formal judicial admissions (see Falkowski v 81 & 3 of Watertown, 288
AD2d 890, 891; Prince, Richardson on Evidence § 8-215, at 523-524
[Farrell 11th ed]). Formal judicial admissions are conclusive of the
facts admitted in the action in which they are made (see Coffin v Grand Rapids Hydraulic Co., 136 NY 655).

Here, HVT made a formal judicial admission that it was listed as
owner on the certificate of title. A certificate of title is prima
facie evidence of ownership (see Vehicle and Traffic Law § 2108[c]; Switzer v Aldrich, 307 NY 56; Corrigan v DiGuardia, 166 AD2d 408; Salisbury v Smith, 115
AD2d 840). Although this presumption of ownership is not conclusive,
and may be rebutted by evidence which demonstrates that another
individual owned the vehicle in question (see Aronov v Bruins Transp., 294 AD2d 523; Dorizas v Island Insulation Corp., 254
AD2d 246), there was no evidence in the record to rebut that
presumption. "In reviewing a determination made after a nonjury trial,
the power of this Court is as broad as that of the trial court, and
this Court may render the judgment it finds warranted by the facts,'
bearing in mind that in a close case, the trial judge had the advantage
of seeing the witnesses" (Stevens v State of New York, 47 AD3d 624, 624-625, quoting Northern Westchester Professional Park Assoc. v Town of Bedford, 60
NY2d 492, 499). Based on our review of the evidence, judgment in favor
of the plaintiff and against HVT on the issue of liability is
warranted.

Morreale v Serrano, 2009 NY Slip Op 07992 (App. Div., 2nd, 2009)

The Supreme Court properly denied the plaintiff's motion for summary
judgment on the complaint, inasmuch as the plaintiff failed to meet his
initial burden of establishing, by admissible evidence, his prima facie
entitlement to judgment as a matter of law (see Alvarez v Prospect Hosp.,
68 NY2d 320, 324). To the extent that the plaintiff relied on the
defendant's response to his notice to admit, that notice improperly
sought the defendant's admissions to facts that went to "the heart of
the matter" (Lolly v Brookdale Univ. Hosp. & Med. Ctr., 45 AD3d 537, 537; see Glasser v City of New York,
265 AD2d 526). In light of our determination, we need not examine the
sufficiency of the papers submitted by the defendant in opposition to
the motion (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853).

Sanctions (22 NYCRR 130-1.1) and Contempt. A non-party can’t be sanctioned under 130-1.1

Thankfully, these are short decisions.

22 NYCRR 130-1.1 Costs; sanctions

Singer v New York City Tr. Auth., 2009 NY Slip Op 07956 (App. Div., 1st, 2009)

Supreme Court providently exercised its discretion in denying
plaintiff's motion for sanctions, which was brought eight months after
the trial had concluded with a verdict in plaintiff's favor. While the
trial court had stated that plaintiff could move for sanctions
"whenever [she] wish[ed] to," this remark did not provide plaintiff
with an unlimited period of time to bring the motion, and as the court
found, the eight-month delay was unreasonable.

Ficus Invs., Inc. v Private Capital Mgt., L.L.C., 2009 NY Slip Op 07493 (App. Div., 1st, 2009)

Order, Supreme Court, New York County (Bernard J. Fried, J.), entered
September 10, 2008, which, to the extent appealed from as limited by
the brief, granted plaintiffs' motion to hold defendant Christopher
Chalavoutis in civil contempt, unanimously affirmed, with costs.

The record demonstrates that in February 2008 defendant was
instrumental in negotiating the conveyance of certain mortgages without
providing notice to plaintiffs, thereby disobeying an order of the
court, entered December 21, 2007, that prohibited defendant from taking
any action with respect to the subject mortgages "without first
providing 48 hour[] written notice" to counsel for plaintiffs. The
record further demonstrates that defendant's actions were calculated to
impair, impede or prejudice plaintiffs' rights (see Matter of McCormick v Axelrod, 59 NY2d 574, 583 [1983]).

Joan 2000, Ltd. v Deco Constr. Corp., 2009 NY Slip Op 07593 (App. Div., 2nd, 2009)

Pursuant to 22 NYCRR 130-1.1, sanctions may be imposed against a party or the attorney for a party for frivolous conduct (see
22 NYCRR 130-1.1[b]). Conduct is frivolous if it is completely without
merit in law or fact and cannot be supported by a reasonable argument
for the extension, modification, or reversal of existing law; it is
taken to primarily delay or prolong the resolution of the litigation,
or harass or maliciously injure another; or it asserts material factual
statements that are false (see 22 NYCRR 130-1.1[c]; Mascia v Maresco, 39 AD3d 504; Greene v Doral Conference Ctr. Assoc.,
18 AD3d 429, 431). Here, the Supreme Court improvidently exercised its
discretion in imposing a sanction upon Eric W. Berry, the attorney for
the defendant WBP Central Associates, LLC, as his conduct was not
frivolous within the meaning of 22 NYCRR 130-1.1 (see Wagner v Goldberg, 293 AD2d 527; Matter of Gavilanes v Dilan, 281 AD2d 546).

Additionally, the Supreme Court had no authority to impose a sanction
upon Anthony Piazza pursuant to 22 NYCRR 130-1.1, since he is neither a
party to this action nor an attorney (see Brock v Wagner, 283 AD2d 535; Saastomoinen v Pagano, 278 AD2d 218).

G&T Term. Packaging Co. Inc. v Western Growers Assn., 2009 NY Slip Op 07503 (App. Div., 1st, 2009)

The IAS court did not abuse its discretion by determining that
plaintiffs' conduct was frivolous within the meaning of 22 NYCRR
130-1.1(c)(2) (see Pickens v Castro, 55 AD3d 443,
444 [2008]). Contrary to plaintiffs' claim, courts take into
consideration the entire dispute between the parties, not just the
lawsuit in which sanctions are imposed (see Murray v National Broadcasting Co., 217 AD2d 651, 653 [1995]; Matter of Jemzura v Mugglin, 207 AD2d 645 [1994], appeal dismissed
84 NY2d 977 [1994]). If plaintiffs wished to litigate the underlying
merits of the parties' dispute, e.g., the quality of the produce sold
by one of the defendants to one of the plaintiffs (see 56 AD3d 266 [2008], appeal dismissed 12 NY3d 729 [2009]), they should have
pursued their federal appeals (see generally Jason v Chusid, 172 AD2d 172, 173 [1991], lv dismissed 78 NY2d 1008 [1991]).

The bold is mine.

22 NYCRR § 208.14(c); CPLR R. 3404; an interesting (but wrong) theory re: law of the case

Law of the case

22 NYCRR § 208.14 Calendar default; restoration; dismissal

(c) Actions stricken from the calendar may be restored to the calendar only upon stipulation of all parties so ordered by the court or by motion on notice to all other parties, made within one year after the action is stricken. A motion must be supported by affidavit by a person having firsthand knowledge, satisfactorily explaining the reasons for the action having been stricken and showing that it is presently ready for trial.

CPLR R. 3404 Dismissal of abandoned cases

Bowman v Beach Concerts, Inc., 2009 NY Slip Op 07747 (App. Div., 1st, 2009)

As plaintiff concedes, the showing of merit required on a motion to restore is less than that required to defend a motion for summary judgment (see Kaufman v Bauer, 36 AD3d 481, 482 [2007]). Indeed, this Court has previously held that a finding of merit sufficient to vacate a plaintiff's default does not preclude a subsequent granting of summary judgment to defendants (see Gamiel v Curtis & Reiss-Curtis, P.C., 60 AD3d 473, 474 [2009], lv dismissed __ NY3d __ [2009], 2009 NY LEXIS 3484; see also Embraer Fin. Ltd. v Servicios Aereos Profesionales, S.A., 42 AD3d 380, 381 [2007]). Thus, plaintiff's argument that this Court's prior order was "law of the case" precluding summary judgment in respondents' favor, or an "implicit recognition" of the merits of his claims, is without merit.

Deltejo v St. Nicholas Venture Inc., 2009 NY Slip Op 07689 (App. Div., 1st, 2009)\

Because the dismissal order, under CPLR 3404, did not result from an order on notice, it is not appealable as of right. However, we deem the notice of appeal to be a motion for leave to appeal, and exercise our discretion (CPLR 5701[c]) to grant leave and consider the merits of this appeal (see Jun-Yong Kim v A & J Produce Corp., 15 AD3d 251 [2005]; Mulligan v New York Cornell Med. Ctr., 304 AD2d 492 [2003]).

The matter is restored to the trial calendar without prejudice to defendants' seeking preclusion relief. It is apparent that another Justice on a prior motion for restoration had intended that the matter go to trial, and that if plaintiff could not produce certain medical evidence, defendants' remedy would be issue preclusion, not an order striking the complaint. Defendants argue that the prior order was wrongly decided and the motion to restore should have been denied outright. However, defendants did not appeal from that order, and in any event, their argument is without merit (see Burgos v 2915 Surf Ave. Food Mart, 298 AD2d 282 [2002]).

.

CPLR R. 3211 Roundup: CPLR R. 3211(a)(1,3,5,7); CPLR R. 3211(e) and CPLR § 205 with CPLR § 321

In Pari Delicto 

CPLR R. 3211

(a)(1) defense is founded upon documentary evidence

(a)(3) the party asserting the cause of action has not legal capacity to sue

(a)(5) the
cause of action may not be maintained because of arbitration and award,
collateral estoppel, discharge in bankruptcy, infancy or other
disability of the moving party, payment, release, res judicata, statute
of limitations, or statute of frauds

(a)(7)  pleading fails to state a cause of action

CPLR § 205 Termination of action

(a) New action by plaintiff.

CPLR § 321 Attorneys
(a) Appearance in person or by attorney

Symbol Tech., Inc. v Deloitte & Touche, LLP, 2009 NY Slip Op 07826 (App. Div., 2nd, 2009)

To obtain a dismissal pursuant to CPLR 3211(a)(1), the defendant
must establish that the documentary evidence which forms the basis of
the defense be such that it resolves all factual issues as a matter of
law and conclusively disposes of the plaintiff's claim (see Leon v Martinez, 84 NY2d 83; see also Sheridan v Town of Orangetown, 21 AD3d 365).

CPLR 3211(a)(7) permits the court to dismiss a complaint that
fails to state a cause of action. The complaint must be liberally
construed and the plaintiff given the benefit of every favorable
inference (see Leon v Martinez, 84 NY2d 83; Aberbach v Biomedical Tissue Serv., Ltd., 48 AD3d 716; Mitchell v TAM Equities, Inc., 27
AD3d 703). The court must also accept as true all of the facts alleged
in the complaint and any factual submissions made in opposition to the
motion (see 511 West 232nd Owners Corp. v Jennifer Realty Co., 98 NY2d 144; Sokoloff v Harriman Estates Dev. Corp., 96 NY2d 409; Alsol Enters., Ltd. v Premier Lincoln-Mercury, Inc., 11
AD3d 493). If the court can determine that the plaintiff is entitled to
relief on any view of the facts stated, its inquiry is complete and the
complaint must be declared legally sufficient (see Campaign for Fiscal Equity v State of New York, 86 NY2d 307, 318; see also Sokoloff v Harriman Estates Dev. Corp., 96 NY2d 409; Stucklen v Kabro Assoc., 18
AD3d 461). While factual allegations contained in the complaint are
deemed true, bare legal conclusions and facts flatly contradicted on
the record are not entitled to a presumption of truth (see Lutz v Caracappa, 35 AD3d 673, 674l; Matter of Loukoumi, Inc., 285 AD2d 595).

Finally, CPLR 3211(a)(5) permits the defendant to seek and
obtain a dismissal of one or more causes of action asserted against it
on the ground that the cause of action is barred by the statute of
limitations.

***

The doctrine of in pari delicto is an equitable defense based on
agency principles which bars a plaintiff from recovering where the
plaintiff is itself at fault (see Ross v Bolton, 904 F2d 819, 824-825; Matter of Food Management Group v Rattet, 380 BR 677, 693-694; Albright v Shapiro, 214 AD2d 496; Bullmore v Ernst & Young Cayman Is., 20
Misc 3d 667, 670). Moreover, the misconduct of managers acting within
the scope of their employment will normally be imputed to the
corporation (see Wight v Bank America Corp., 219 F3d 79, 86; Center v Hampton Affiliates, 66 NY2d 782, 784; Christopher S. v Douglaston Club, 275
AD2d 768, 769). The underlying concept is that the actions of an agent
can be imputed to a corporation when its agent acts within the scope of
his or her employment (see Center v Hampton Affiliates, 66 NY2d at 784).

Under New York law, the doctrine of in pari delicto is subject to the "adverse interest" exception [FN2] (see Center v Hampton Affiliates, 66
NY2d 782). In this case, Symbol's amended complaint is sufficient to
trigger the adverse interest exception to the in pari delicto doctrine.

The "adverse interest" exception is a method by which a
plaintiff corporation can demonstrate that its agent's actions should
not be imputed to it. The corporation must show that the agent's fraud
was entirely self-interested and that the corporation did not benefit
in any way (see 546-552 West 146th St., LLC v Arfa, 54 AD3d 543; Capital Wireless Corp. v Deloitte & Touche, 216
AD2d 663, 666). If the agent was acting solely for his or her own
benefit and to the detriment of the corporation, it cannot be said that
the agent was acting in the scope of his or her employment (see Center v Hampton Affilliates, 66 [*4]NY2d at 784).

This exception has been defined very narrowly in New York (see 546-552 West 146th St., LLC v Arfa, 54
AD3d 543). Under this narrow exception, management misconduct will not
be imputed to the corporation if the officer acted entirely in his own
interest and adversely to the interest of the corporation (see Center v Hampton Affiliates, 66
NY2d at 785). "The theory is that where an agent, though ostensibly
acting in the business of the principal, is really committing a fraud
for his own benefit, he is acting outside of the scope of his agency,
and it would therefore be most unjust to charge the principal with
knowledge of it" (Wight v Bank America Corp., 219 F3d 79, 87).
The adverse interest exception applies only when the agent has "totally
abandoned" the principal's interests and is acting entirely for his own
or another's purposes (Center v Hampton Affiliates, 66 NY2d at 785).

Credigy Receivables, Inc. v Agiwal, 2009 NY Slip Op 07790 (App. Div., 2nd, 2009)

The appeal from the intermediate order dated February 7, 2008, must
be dismissed because the right of direct appeal therefrom terminated
with the entry of judgment in the action (see Matter of Aho, 39 NY2d 241, 248). The issues raised on appeal from that order are brought up for [*2]review and have been considered on appeal from the judgment (see CPLR 5501[a][1]).

The defendant's motion to dismiss the complaint based on lack of
personal jurisdiction was properly denied on the ground that the
objection of improper service of the summons and complaint was waived
by the defendant's failure to move to dismiss on that ground within 60
days of service of the answer (see CPLR 3211[e]).

In its motion for summary judgment, the plaintiff established
its entitlement to judgment as a matter of law against the defendant in
the principal sum of $55,682.32, and the defendant failed to raise a
triable issue of fact in response thereto (see Alvarez v Prospect Hosp., 68 NY2d 320).

Moran Enters., Inc. v Hurst, 2009 NY Slip Op 07807 (App. Div., 2nd, 2009)

The Supreme Court erred in dismissing the complaint pursuant to CPLR
3211(a)(5). The principle of res judicata bars relitigation of claims
where a judgment on the merits exists from a prior action between the
same parties involving the same subject matter (see Matter of Hunter,
4 NY3d 260, 269). Dismissal of the prior action insofar as asserted by
MEI was upheld by this Court on the ground that MEI failed to appear by
an attorney as required by CPLR 321(a) (see Moran v Hurst, 32
AD3d 909). Such was not a

Continue reading “CPLR R. 3211 Roundup: CPLR R. 3211(a)(1,3,5,7); CPLR R. 3211(e) and CPLR § 205 with CPLR § 321”