Author: DMG

CPLR 3211(c)

Karimian v Time Equities, Inc., 2018 NY Slip Op 05583 [2d Dept 2018]

With respect to the defendants' cross appeal, CPLR 3211(c) provides, "[u]pon the hearing of a motion made under subdivision (a) or (b), either party may submit any evidence that could properly be considered on a motion for summary judgment. Whether or not issue has been joined, the court, after adequate notice to the parties, may treat the motion as a motion for summary judgment." Although the path the defendants took in moving pursuant to CPLR 3211(c) was procedurally questionable, they charted their own course in this instance. There was no need to give the plaintiff an opportunity to file additional papers because the defendants failed to establish their prima facie entitlement to judgment as a matter of law by failing to tender sufficient evidence to eliminate any issues of fact with respect to those causes of action. Accordingly, the defendants were properly denied summary judgment, without regard to the sufficiency of the opposition papers (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853).

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CPLR 2103(b)(2) CPLR 2103(b)(6), no sua sponte dismissal

Moran v BAC Field Servs. Corp., 2018 NY Slip Op 05586 [2d Dept 2018]

Contrary to the Supreme Court's determination, CPLR 2103(b)(2) does not apply to render BAC's motion timely since BAC did not attempt service of its motion by using "the post office or official depository under the exclusive care and custody of the United States Postal Service within the state" (CPLR 2103[f][1]). Rather, BAC utilized Federal Express. CPLR 2103(b)(6) provides that "[s]ervice by overnight delivery service shall be complete upon deposit of the paper . . . into the custody of the overnight delivery service for overnight delivery" (emphasis added). The record demonstrates that BAC failed to use Federal Express's overnight delivery service, and instead deposited its papers with Federal Express on Friday for weekday delivery on Monday. Accordingly, the court should have denied BAC's motion as untimely.

We agree with the Supreme Court's denial, as untimely, of the plaintiff's cross motion for leave to enter a default judgment against BAC, since the plaintiff failed to serve his cross motion within the time period required by CPLR 2215(b).

However, the Supreme Court should not have, sua sponte, directed the dismissal of the complaint insofar as asserted against Omega, and should have granted the plaintiff's separate motion for leave to enter a default judgment against Omega. " On a motion for leave to enter a default judgment pursuant to CPLR 3215, the movant is required to submit proof of service of the summons and complaint, proof of the facts constituting the claim, and proof of the defaulting party's default in answering or appearing'" (Dupps v Betancourt, 99 AD3d 855, quoting Atlantic Cas. Ins. Co. v RJNJ Servs., Inc., 89 AD3d 649, 651; see CPLR 3215[f]). Here, in support of his motion, the plaintiff met all of these requirements as to Omega. Further, Omega never appeared in the action and failed to move to vacate its default (see BAC Home Loans Servicing, LP v Reardon, 132 AD3d 790).

The Supreme Court also should not have, sua sponte, directed the dismissal of the complaint insofar as asserted against Boehm. There was no motion before the court seeking such relief, and the plaintiff was not on notice that such relief could be granted by the court (see Abinanti v Pascale, 41 AD3d 395).

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CPLR 7804(g)

Matter of Fildon, LLC v Planning Bd. of the Inc. Vil. of Hempstead, 2018 NY Slip Op 05591 [2d Dept 2018]

Initially, the Supreme Court should not have transferred this proceeding to this Court pursuant to CPLR 7804(g) because the determination to be reviewed was "not made after a trial-type hearing held pursuant to direction of law at which evidence was taken" (Matter of M & V 99 Franklin Realty Corp. v Weiss, 124 AD3d 783, 784; see CPLR 7803[4]; Village Law § 7-725-a[11]; Matter of Navaretta v Town of Oyster Bay, 72 AD3d 823, 824; Matter of Halperin v City of New Rochelle, 24 AD3d 768, 769). Municipal land use agencies are "quasi-legislative, quasi-administrative bodies," and "the public hearings they conduct are informational in nature and [do] not involve the receipt of sworn testimony or taking of evidence within the meaning of CPLR 7803(4)" (Matter of Halperin v City of New Rochelle, 24 AD3d at 770 [internal quotation marks and citations omitted]). "Accordingly, determinations of such agencies are reviewed under the arbitrary and capricious' standard of CPLR 7803(3), and not the substantial evidence' standard of CPLR 7803(4)" (id.; see Matter of M & V 99 Franklin Realty Corp. v Weiss, 124 AD3d at 784). In the interest of judicial economy, this Court will nevertheless decide the petition on the merits, as the full administrative record is before this Court (see Matter of M & V 99 Franklin Realty Corp. v Weiss, 124 AD3d at 784; [*2]Matter of Halperin v City of New Rochelle, 24 AD3d at 772-773).

Rescission – material misrep

Piller v Otsego Mut. Fire Ins. Co. 2018 NY Slip Op 05615 [2d Dept 2018]

"To establish the right to rescind an insurance policy, an insurer must show that its insured made a material misrepresentation of fact when he or she secured the policy" (Joseph v Interboro Ins. Co., 144 AD3d 1105, 1106 [internal quotation marks omitted]; see Interboro Ins. Co. v Fatmir, 89 AD3d 993, 993-994; Novick v Middlesex Mut. Assur. Co., 84 AD3d 1330, 1330; Varshavskaya v Metropolitan Life Ins. Co., 68 AD3d 855, 856). "A representation is a statement as to past or present fact, made to the insurer by, or by the authority of, the applicant for insurance or the prospective insured, at or before the making of the insurance contract as an inducement to the making thereof" (Insurance Law § 3105[a]; see Morales v Castlepoint Ins. Co., 125 AD3d 947, 948). "A misrepresentation is material if the insurer would not have issued the policy had it known the facts misrepresented" (Interboro Ins. Co. v. Fatmir, 89 AD3d at 994; see Insurance Law § 3105[b][1]; Novick v Middlesex Mut. Assur. Co., 84 AD3d at 1330; Varshavskaya v Metropolitan Life Ins. Co., 68 AD3d at 856). "To establish materiality as a matter of law, the insurer must present documentation concerning its underwriting practices, such as underwriting manuals, bulletins, or rules pertaining to similar risks, that show that it would not have issued the same policy if the correct information had been disclosed in the application" (Morales v Castlepoint Ins. Co., 125 AD3d at 948 [internal quotation marks omitted] ; see Joseph v Interboro Ins. Co., 144 AD3d at 1106; Interboro Ins. Co. v Fatmir, 89 AD3d at 994; Schirmer v Penkert, 41 AD3d 688, 690-691).

Otsego Mutual established its prima facie entitlement to judgment as a matter of law by submitting evidence demonstrating that the plaintiffs' application for insurance contained a material misrepresentation regarding whether the townhouse would be owner-occupied and that it would not have issued the subject policy if the application had disclosed that the townhouse would not be owner-occupied (see Joseph v Interboro Ins. Co., 144 AD3d at 1106; Morales v Castlepoint Ins. Co., 125 AD3d at 948; Interboro Ins. Co. v. Fatmir, 89 AD3d at 993-994).

In opposition, the plaintiffs failed to raise a triable issue of fact. The plaintiffs' contention that Otsego Mutual was required to establish that their misrepresentation was willful lacks merit. With limited exception not applicable here, "a material misrepresentation, even if innocent or unintentional, is sufficient to warrant rescission of an insurance policy" (Joseph v Interboro Ins. Co., 144 AD3d at 1107; see Smith v Guardian Life Ins. Co. of Am., 116 AD3d 1031, 1032; Security Mut. Ins. Co. v Perkins, 86 AD3d 702, 703; Precision Auto Accessories, Inc. v Utica First Ins. Co., 52 AD3d 1198, 1201; McLaughlin v Nationwide Mut. Fire Ins. Co., 8 AD3d 739, 740; see also Insurance Law § 3105).

 

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CPLR 1021

Laroche v Laroche, 2018 NY Slip Op 04708 [2d Dept 2018]

"If a party dies and the claim for or against him [or her] is not thereby extinguished the court shall order substitution of the proper parties" (CPLR 1015[a]). "A motion for substitution may be made by the successors or representatives of a party or by any party" (CPLR 1021). Further, "[i]f the event requiring substitution occurs before final judgment and substitution is not made within a reasonable time, the action may be dismissed as to the party for whom substitution should have been made" (CPLR 1021). "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" (Dieye v Royal Blue Servs., Inc., 104 AD3d 724, 726). The determination whether to exercise its authority to appoint a temporary administrator is addressed to the broad discretion of the Supreme Court (see Rosenfeld v Hotel Corp. of Am., 20 NY2d 25, 28; Lambert v Estren, 126 AD3d 942, 943; see e.g. Meczkowski v E.W. Howell Co., Inc., 63 AD3d 803). "In most instances the personal representative of the decedent's estate should be substituted in the action" (Weinstein-Korn-Miller, NY Civ Prac, ¶ 1015.06; see Grillo v Tese, 113 AD2d 871, 873).

Here, contrary to Allstate's contention, CPLR 1021 did not give Allstate authority to move to dismiss the complaint, but rather only gave permission to "any party" to move for substitution. Further, Allstate did not submit any proof that it gave notice to the persons interested in the defendant's estate of its motion as required by statute (see CPLR 1021). Moreover, CPLR 1021 provides that an action may be dismissed as to the party for whom substitution should have been made if substitution is not made within a reasonable time. "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" (Terpis v Regal Hgts. Rehabilitation & Health Care Ctr., Inc., 108 AD3d 618, 619; see Alejandro v North Tarrytown Realty Assoc., 129 AD3d 749, 749; Riedel v Kapoor, 123 AD3d 996; Largo-Chicaiza v Westchester Scaffold Equip. Corp., 90 AD3d 716, 717). Absent from the record are any details regarding the diligence employed in seeking substitution, any demonstration that the defense would be prejudiced by the substitution, or a showing of the merits of either the complaint or the defense (cf. Borruso v New York Methodist Hosp., 84 AD3d 1293, 1295). Accordingly, the Supreme Court should have denied Allstate's motion pursuant to CPLR 1021 to dismiss the complaint.

However, with respect to the cross motion, the plaintiff failed to demonstrate any reasonable excuse for the delay in moving for the appointment and substitution of a representative for the defendant's estate. The plaintiff only cross-moved for the appointment and substitution in response to Allstate's motion to dismiss the complaint, and did not submit an affidavit of merit (see Alejandro v North Tarrytown Realty Assoc., 129 AD3d at 750; Terpis v Regal Hgts. Rehabilitation & Health Care Ctr., Inc., 108 AD3d at 619). Moreover, the plaintiff did not demonstrate the steps taken to secure the appointment of a personal representative or show that it was necessary for the Supreme Court to appoint a temporary administrator to avoid delay and prejudice in the pending action where issue had yet to be joined and Karen L. Lawrence had not appeared on behalf of the defendant (see CPLR 1015[a]; Kastrataj v Blades, 136 AD3d 756, 758; Lambert v Estren, 126 AD3d at 944). Accordingly, we agree with the Supreme Court's denial of the plaintiff's cross motion under the circumstances presented.

Personal Jurisdiction

Matter of Wilson v Brown, 2018 NY Slip Op 04743 [2d Dept 2018]

"An appearance by a defendant in an action is deemed to be the equivalent of personal service of a summons upon him [or her], and therefore confers personal jurisdiction over him [or her], unless he [or she] asserts an objection to jurisdiction either by way of motion or in his [or her] answer" (Countrywide Home Loans Servicing, LP v Albert, 78 AD3d 983, 984 [internal quotation marks omitted]; see National Loan Invs., L.P. v Piscitello, 21 AD3d 537, 537-538). " By statute, a party may appear in an action by attorney (CPLR 321), and such an appearance constitutes an appearance by the party for purposes of conferring jurisdiction'" (National Loan Invs., L.P. v Piscitello, 21 AD3d at 537-538, quoting Skyline Agency v Coppotelli, Inc., 117 AD2d 135, 140). Here, by actively participating in the proceedings through her counsel, the mother waived any claim that the Family Court did not acquire personal jurisdiction over her (see Matter of Tylan C. [Patricia H.], 140 AD3d 1161, 1162; Matter of El-Sheemy v El-Sheemy, 35 AD3d 738, 739; Matter of Borggreen v Borggreen, 13 AD3d 756, 757; Matter of Fallon v Fallon, 4 AD3d 426, 427; Matter of Brozzo v Brozzo, 192 AD2d 878, 880).

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CPLR 5015 (repeated neglect and not so repeated neglect)

Zovko v Quittner Realty, LLC, 2018 NY Slip Op 04775 [2d Dept 2018]

A defendant seeking to vacate an order awarding a default must demonstrate both a reasonable excuse for the default and the existence of a potentially meritorious defense (see CPLR 5015[a][1]; Skutelsky v JN Natural Fruit Corp., 138 AD3d 1099, 1100; Orwell Bldg. Corp. v Bessaha, 5 AD3d 573, 574; Quis v Bolden, 298 AD2d 375). The defendant failed to demonstrate a reasonable excuse for its default. The defendant's mistaken belief that its insurer would provide a defense and answer the summons and complaint on its behalf was unreasonable given its insurer's reservation of rights letter and request for a copy of any summons served upon the defendant, and the plaintiffs' motion for leave to enter a default judgment (see Medas v Rochpark Realty, LLC, 150 AD3d 1221, 1223; Spitzer v Landau, 104 AD3d 936, 936-937; Trepel v Greenman-Pedersen, Inc., 99 AD3d 789, 791; Jackson v Professional Transp. Corp., 81 AD3d 602, 603; Lemberger v Congregation Yetev Lev D'Satmar, Inc., 33 AD3d 671, 672). Furthermore, this alleged mistake was not an isolated error, but part of a pattern of "repeated neglect" (Roussodimou v Zafiriadis, 238 AD2d 568, 569; see Wells Fargo Bank, N.A. v Krauss, 128 AD3d 813, 814; Alterbaum v Shubert Org., Inc., 80 AD3d 635, 636; Majestic Clothing Inc. v East Coast Stor., LLC, 18 AD3d 516, 518). In this regard, the defendant was aware of the default order, but took no steps to vacate the default until five months after its insurer disclaimed coverage (see Wells Fargo Bank, N.A. v Krauss, 128 AD3d at 815; Miller v Ateres Shlomo, LLC, 49 AD3d 612, 613; Thompson v Steuben Realty Corp., 18 AD3d 864, 865; Robinson v 1068 Flatbush Realty, Inc., 10 AD3d 716, 716-717). Since the defendant failed to demonstrate a reasonable excuse for its default, we need not reach the issue of whether it demonstrated the existence of a potentially meritorious defense (see Medas v Rochpark Realty, LLC, 150 AD3d at 1223; Jing Shan Chen v R & K 51 Realty, Inc., 148 AD3d 689, 691; Bernstein v Geiss, 111 AD3d 774, 775).

New York Vein Ctr., LLC v Dovlaryan, 2018 NY Slip Op 04744 [2d Dept 2018]

In seeking to vacate their defaults in appearing at a compliance conference and in opposing the plaintiff's motion to strike their answer, the defendants were required to demonstrate both a reasonable excuse for their defaults and a potentially meritorious defense (see CPLR 5015[a][1]; 22 NYCRR 202.27[a]; 555 Prospect Assoc., LLC v Greenwich Design & Dev. Group Corp., 154 AD3d 909; Prudence v White, 144 AD3d 655, 656). The defendants failed to establish a reasonable excuse for their failure to (1) appear at the compliance conference, (2) oppose the plaintiff's motion to strike their answer, (3) respond to their former attorney's motion to withdraw as counsel, and (4) appear at the inquest on the issue of damages. Moreover, the record shows that the defendants took no steps to ascertain the status of this case for a period of more than two years. Furthermore, where, as here, there is a pattern of default and neglect, the negligence of the defendants' former attorney is properly imputed to the client (see Carillon Nursing & Rehabilitation Ctr., LLP v Fox, 118 AD3d 933, 934; Santiago v Santana, 54 AD3d 929, 930; Dave Sandel, Inc. v Specialized Indus. Servs. Corp., 35 AD3d 790, 791; Edwards v Feliz, 28 AD3d 512, 513; MRI Enters. v Amanat, 263 AD2d 530, 531). Since the defendants failed to demonstrate a reasonable excuse for their defaults, we need not reach the issue of whether they demonstrated the existence of a potentially meritorious defense to the action or the plaintiff's motion to strike their answer (see Bernstein v Geiss, 111 AD3d 774, 775).

Lee v Latendorf, 2018 NY Slip Op 04709 [2d Dept. 2018]

In order to vacate a default in appearing at a scheduled court conference, a plaintiff must demonstrate both a reasonable excuse for the default and a potentially meritorious cause of action (see CPLR 5015[a][1]; Stein v Doukas, 157 AD3d 743, 744; One West Bank, FSB v Singer, 153 AD3d 714, 715; Gallery v Messerschmitt, 151 AD3d 940; Wright v City of Poughkeepsie, 136 AD3d 809). "A determination of whether an excuse is reasonable lies within the sound discretion of the Supreme Court" (Stein v Doukas, 157 AD3d 743, 744). Although a court has discretion to accept law office failure as a reasonable excuse (see CPLR 2005), "a pattern of willful default and neglect should not be excused" (Prudence v White, 144 AD3d 655, 656; see Whitestone Constr. Corp. v Nova Cas. Co., 129 AD3d 831, 832). A claim of law office failure must be supported by a detailed and credible explanation of the default at issue, as mere neglect is not a reasonable excuse (see Ki Tae Kim v Bishop, 156 AD3d 776; One West Bank, FSB v Singer, 153 AD3d at 716; Onishenko v Ntansah, 145 AD3d 910).

Here, the Supreme Court providently exercised its discretion in determining that the plaintiffs did not offer a reasonable excuse for their default. The excuse proffered by the plaintiffs' former attorney, that he failed to appear at the May 19, 2015, conference due to a malfunctioning GPS system and that he "got lost," was unreasonable under the circumstances, as it was not a detailed and credible explanation for the claimed law office failure. Moreover, the plaintiffs failed to set forth any excuse, let alone a reasonable one, for their former attorney's failure to appear at the compliance conference scheduled for February 18, 2015, or why he arrived late for the adjourned conference on February 26, 2015.

Since the plaintiffs failed to offer a reasonable excuse for their default, the issue of whether they had a potentially meritorious cause of action need not be addressed (see Stein v Doukas, 157 AD3d 743; Ki Tae Kim v Bishop, 156 AD3d 776).

Chase Manhattan Bank v Nath, 2018 NY Slip Op 04695 [2d Dept 2018]

Moreover, the defendant's contention that the plaintiff fraudulently obtained the judgment of foreclosure and sale by making false allegations in the complaint about its standing and capacity to commence the action and by submitting fraudulent documents to the court amount to an allegation of intrinsic fraud (see PennyMac Corp. v Weiss, 152 AD3d 712, 714; US Bank N.A. v Galloway, 150 AD3d 1174, 1175; U.S. Bank, N.A. v Peters, 127 AD3d 742, 742-743). The defendant failed to provide any evidence of fraud, mistake, inadvertence, surprise, or excusable neglect that would constitute a basis for vacatur of the judgment of foreclosure and sale in the interests of substantial justice (see Wells Fargo Bank Minn., N.A. v Coletta, 153 AD3d 757, 758).

In addition, lack of standing and lack of capacity are not defects that deprive a court of subject matter jurisdiction for purposes of CPLR 5015(a)(4) (see Behringer v 19407 Linden, LLC, 139 AD3d 777, 778; Mortgage Elec. Registration Sys., Inc. v Gifford, 133 AD3d 429, 430-431; Wells Fargo Bank, N.A. v Rooney, 132 AD3d 980, 983; Wells Fargo Bank Minn., N.A. v Mastropaolo, 42 AD3d 239). In any event, the defendant waived these defenses by failing to assert them in his answer or a pre-answer motion to dismiss (see Bank of Am., N.A. v Cudjoe, 157 AD3d 653; Wells Fargo Bank, N.A. v Erobobo, 127 AD3d 1176, 1177; Security Pac. Natl. Bank v Evans, 31 AD3d 278, 280).

Additionally, the defendant failed to demonstrate his entitlement to vacatur pursuant to CPLR 5015(a)(2) based on newly discovered evidence. Even if the evidence proffered was new within the meaning of the statute, the defendant failed to establish that the newly discovered evidence probably would have produced a different result (see Bank of N.Y. v Tobing, 155 AD3d 596, 596; US Bank N.A. v Galloway, 150 AD3d at 1175; IMC Mtge. Co. v Vetere, 142 AD3d 954, 955; Washington Mut. Bank v Wade, 119 AD3d 930, 931).

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CPLR 1018

JPMorgan Chase Bank N.A. v Wenegieme, 2018 NY Slip Op 04541 [2d Dept. 2018]

The plaintiff, who is the original lender, established its prima facie entitlement to judgment as a matter of law through the production of the mortgage, the unpaid note, and evidence of the defendant's default (see Wells Fargo Bank, N.A. v Ali, 122 AD3d 726, 726; Midfirst Bank v Agho, 121 AD3d 343, 347). In opposition, the defendant failed to raise a triable issue of fact.

Contrary to the defendant's contention, in the absence of a court order directing otherwise, the plaintiff had the capacity to continue this action after assigning the mortgage and note (see CPLR 1018; Woori Am. Bank v Global Universal Group Ltd., 134 AD3d 699, 700; Wells Fargo Bank, N.A. v Hudson, 98 AD3d 576, 577-578).

CPLR 5511

U.S. Bank, N.A. v Hossain, 2018 NY Slip Op 04593 [2d Dept. 2018]

This appeal was taken by notice of appeal dated February 18, 2016, and served on February 19, 2016. The notice of appeal was signed by an attorney from a law firm which identified itself as the attorneys for "Plaintiff's assignee," the assignee being identified as Wilmington Trust, National Association, not in its individual capacity but as Trustee for ARLP Securitization Trust Series 2015 (hereinafter Wilmington Trust). The brief filed in support of the appeal by Wilmington Trust characterizes Wilmington Trust as "Nonparty-Appellant." According to the brief, the subject mortgage was assigned by the plaintiff to Christiana Trust, a Division of Wilmington Savings Fund Society, FSB, not in its individual capacity but as Trustee of ARLP Trust 2 (hereinafter Christiana Trust), by assignment dated April 19, 2016, and recorded on July 18, 2016. Further, the brief asserts that the mortgage was assigned by Christiana Trust to Wilmington Trust by assignment dated May 18, 2016, and recorded on June 23, 2016.

The appeal must be dismissed as, according to the information provided by the appellant, it was neither a party to the action nor an assignee of a party at the time the appeal was taken (see CPLR 5511).

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Hernstat v Anthony's Windows on the Lake, Inc., 2018 NY Slip Op 04311 [2d Dept. 2018]

The plaintiff commenced this personal injury action after she fell from an interior staircase at the defendants' premises. The defendants subsequently moved for summary judgment dismissing the complaint based on spoliation of evidence. The defendants contended that their efforts to defend against the action by arguing that the high-heeled shoes worn by the plaintiff at the time of her accident caused or contributed to her fall were fatally compromised by the plaintiff's disposal of the shoes shortly after her accident. In opposition to the motion, the plaintiff contended that the sanction of dismissal was unwarranted, and proposed the imposition of the lesser sanction of an adverse inference charge to be given to the jury at trial. The Supreme Court denied the defendants' motion and imposed the lesser sanction of an adverse inference charge, as requested by the plaintiff. The plaintiff appeals.

The appeal must be dismissed, as the plaintiff is not aggrieved by the order appealed from, which denied the defendants' motion for summary judgment and imposed the lesser sanction of an adverse inference charge in accordance with the plaintiff's request (see CPLR 5511; Pillai v Pillai, 153 AD3d 1290).