Category: CPLR

counsel were primarily engaged in claims handling [CPLR 3126]

CPLR 3126

National Union Fire Ins. Co. of Pittsburgh, Pennsylvania v TransCanada Energy USA, Inc., 19 AD3d 492 [1st Dept. 2014]

The record shows that the insurance companies retained counsel to provide a coverage opinion, i.e. an opinion as to whether the insurance companies should pay or deny the claims. Further, the record shows that counsel were primarily engaged in claims handling—an ordinary business activity for an insurance company. Documents prepared in the ordinary course of an insurer's investigation of whether to pay or deny a claim are not privileged, and do not become so " 'merely because [the] investigation was conducted by an attorney' " (see Brooklyn Union Gas Co. v American Home Assur. Co., 23 AD3d 190, 191 [1st Dept 2005]).

We need not reach the question of whether the common interest exception to the attorney client privilege applies, because the documents at issue are not privileged.

CPLR 2003

CPLR 2003

Mooring Capital Fund, LLC v Bronx Miracle Gospel Tabernacle, Inc., 119 AD3d 490 [1st Dept. 2014]

In the order on appeal, Bronx Miracle's fourth motion was granted. Citing CPLR 2003, the motion court (Aarons, J.), reasoned that a discrepancy between the foreclosure Referee's testimony that the property was sold on October 18, 2010 and the Memorandum of Sale on which the date of July 15, 2010 is typewritten was sufficient to set aside the sale, pursuant to the court's equitable powers to prevent fraud, collusion, mistake or misconduct.

We reverse, and deny the motion. CPLR 2003 provides as follows: "At any time within one year after a sale made pursuant to a judgment or order, but not thereafter, the court, upon such terms as may be just, may set the sale aside for a failure to comply with the requirements of the civil practice law and rules as to the notice, time or manner of such sale, if a substantial right of a party was prejudiced by the defect."

Bronx Miracle's motion was made outside the one-year statutory time limit. Even if it had been timely, we would deny it. The typographical error in the Memorandum of Sale, which was executed following the sale, appears to have been a scrivener's error and does not constitute the kind of irregularity contemplated by CPLR 2003. In addition, Bronx Miracle's claimed prejudice resulting from the unconscionably low sale price is unrelated to the scrivener's error, and the alleged inadequacy of the sale price alone "does not furnish sufficient grounds for vacating a sale" (Guardian Loan Co. v Early, 47 NY2d 515, 521 [1979]).

This is often ignored

CPLR 3212

Hecht v Saccoccio, 014 NY Slip Op 05628 [2nd Dept. 2014]

To demonstrate prima facie entitlement to judgment as a matter of law in a premises liability case, a defendant owner must establish that it did not create the condition that allegedly caused the fall or have actual or constructive notice of that condition (see Gordon v American Museum of Natural History, 67 NY2d 836, 837). Only after the defendant has satisfied his or her threshold burden will the court examine the sufficiency of the plaintiff's opposition (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851). On a defendant's motion for summary judgment, it is not the plaintiff's burden in opposing the motion to establish that the defendants had actual or constructive notice of the hazardous condition; rather, it is the defendant's burden to establish the lack of notice as a matter of law (see Giuffrida v Metro N. Commuter R.R. Co., 279 AD2d 403, 404). Thus, a defendant seeking summary judgment dismissing the complaint based on the lack of notice must establish, prima facie, the absence of notice (see Goldin v Riker, 273 AD2d 197, 198).

 

CPLR § 5205

CPLR 5205(j)(2)

Country Bank v Broderick, 2014 NY Slip Op 05621 [2nd Dept. 2014]

The Supreme Court providently exercised its discretion in granting the plaintiff's motion pursuant to CPLR 5240 for a determination that the funds sought to be levied upon—college savings accounts established under the laws of the State of New Hampshire (see NH Rev Stat Ann, ch 195-H)—are not exempt from levy in connection with the satisfaction of an underlying Connecticut money judgment that was docketed in New York pursuant to CPLR 5402.

The parties do not dispute that the protection from creditors afforded by CPLR 5205(j)(2) to college tuition savings program accounts defined in 26 USC § 529 (hereinafter 529 savings plans) does not apply where, as here, the accounts are not qualified college savings program accounts established pursuant to the New York State College Choice Tuition Saving Program, as set forth in Education Law article 14-A. The Supreme Court correctly concluded that the distinction made in CPLR 5205(j) between 529 savings plans established under the laws of New York, and those established in other states, or under the laws of other states, does not violate the equal protection clause of the United States Constitution. Since the classification "is not based on an inherently suspect characteristic and does not impermissibly interfere with the exercise of a fundamental right, it need only rationally further a legitimate state interest to be upheld as constitutional" (Affronti v Crosson, 95 NY2d 713, 718-719; see Nordlinger v Hahn, 505 US 1, 10; New Orleans v Dukes, 427 US 297, 303; Archbishop Walsh High School v Section VI of the N.Y. State Pub. High School Athletic Assn., 88 NY2d 131, 136). Applying this standard of rational basis review, the court properly determined that CPLR 5205(j) was not unconstitutional, as the disparate treatment is not " so unrelated to the achievement of any combination of legitimate purposes'" as to be irrational (Affronti v Crosson, 95 NY2d at 719, quoting Kimel v Florida Bd. of Regents, 28 US 62, 84).

Contrary to the defendant's contention, the statute is not antithetical to the public policy of the State of New York, and "the choice between conflicting policy values is best made by the Legislature" (Anonymous v Bureau of Professional Med. Conduct/State Bd. for Professional Med. Conduct, 2 NY3d 663, 669 [internal quotation marks omitted]).

CPLR 3012; 3216

CPLR 3012

CPLR 3216

Dutchess Truck Repair, Inc. v Boyce, 2014 NY Slip Op 05768 [2nd Dept. 2014]

"Upon the application of a party, the court may extend the time to appear or plead, or compel the acceptance of a pleading untimely served, upon such terms as may be just and upon a showing of reasonable excuse for delay or default" (CPLR 3012[d]; see EHS Quickstops Corp. v [*2]GRJH, Inc., 112 AD3d 577, 578). Similarly, a court may relieve a party from an order on the basis of "excusable default, if such motion is made within one year after service of a copy of the . . . order with written notice of its entry upon the moving party" (CPLR 5015[a][1]). However, relief from a default is proper only where the party seeking relief demonstrates a reasonable excuse for the default and a potentially meritorious defense (see Farhadi v Qureshi, 105 AD3d 990, 991; Deutsche Bank Natl. Trust Co. v Gutierrez, 102 AD3d 825; Deutsche Bank Natl. Trust Co. v Pietranico, 102 AD3d 724, 725).

Here, even assuming that the plaintiffs' excuse of law office failure was sufficient to excuse their failure to serve a timely reply to the counterclaim of the defendants Joe Boyce, Sally Boyce, and Trans Star Enterprises, Inc. (hereinafter collectively the defendants) (see Michaels v Sunrise Bldg. & Remodeling, Inc., 65 AD3d 1021, 1023; CPLR 2005), the Supreme Court properly declined to vacate their default and to compel acceptance of their reply. The record establishes that, after the defendants' rejection of the plaintiffs' reply to the counterclaim and the court's finding that they were in default, the plaintiffs waited nearly two years before moving to vacate their default and to compel the defendants to accept their reply. Because the plaintiffs proffered no reasonable excuse for their failure to promptly seek relief, the court providently exercised its discretion in denying those

branches of the plaintiffs' motion (see Nash v Port Auth. of N.Y. & N.J., 22 NY3d 220, 226; Karalis v New Dimensions HR, Inc., 105 AD3d 707, 708).

"Where a party unreasonably neglects to proceed generally in an action or otherwise delays in the prosecution thereof against any party who may be liable to a separate judgment, or unreasonably fails to serve and file a note of issue, the court, on its own initiative or upon motion, may dismiss the party's pleading on terms" (CPLR 3216[a]). Before doing so, the court or the party seeking such relief must serve a written demand to resume prosecution and to serve and file a note of issue within 90 days of receipt of such demand, and further advise the party upon whom such notice was served that failure to do so may result in dismissal of the action (see CPLR 3216[b][3]). Pursuant to 22 NYCRR 202.21(a), an action will not be deemed ready for trial or inquest unless a note of issue is first filed, accompanied by a certificate of readiness stating that there are no outstanding requests for discovery and the case is ready for trial (see 22 NYCRR 202.21[a], [b]; Furrukh v Forest Hills Hosp., 107 AD3d 668, 669).

On March 26, 2012, the Supreme Court, on its own initiative, and based upon the plaintiffs' repeated failure to file a compliant note of issue as directed, issued a 90-day notice requiring the plaintiffs to produce all outstanding discovery and file a note of issue. Although the plaintiffs filed a note of issue on June 9, 2012, the accompanying certificate of readiness, which stated that an appeal was pending with respect to discovery issues, did not comply with 22 NYCRR 202.21(a) and (b) (see Furrukh v Forest Hills Hosp., 107 AD3d at 669; Brown v Astoria Fed. Sav., 51 AD3d 961, 962; Blackwell v Long Is. Coll. Hosp., 303 AD2d 615, 615-616). The plaintiffs also failed to demonstrate that the complaint should not be dismissed based upon their failure to prosecute the action by proffering "a justifiable excuse for the delay and a meritorious cause of action" (Blackwell v Long Is. Coll. Hosp., 303 AD2d at 616; see Sharpe v Osorio, 21 AD3d 467, 468). Accordingly, the court properly granted that branch of the defendants' motion which was to strike the note of issue and, upon so doing, providently exercised its discretion granting that branch of the defendants' motion which was to dismiss the complaint insofar as asserted against them pursuant to CPLR 3216 for failure to prosecute (see Blackwell v Long Is. Coll. Hosp., 303 AD2d at 616; Perez v Long Is. Jewish-Hillside Med. Ctr., 173 AD2d 530, 530-531).

Bennett v Patel Catskills, LLC, 2014 NY Slip Op 05616 [2nd Dept. 2014]

The process server's affidavit of service created a rebuttable presumption that the plaintiffs served the defendant by delivering a copy of the summons and complaint to the Secretary of State (see CPLR 311-a[a]; Limited Liability Company Law § 303; Kolonkowski v Daily News, L.P., 94 AD3d 704, 705; Thas v Dayrich Trading, Inc., 78 AD3d 1163, 1164; Trini Realty Corp. v Fulton Ctr. LLC, 53 AD3d 479). In opposition, the defendant denied receipt of the summons and complaint. The fact that the summons and complaint, which had been sent by certified mail, return receipt requested, to the address on file with the New York Secretary of State, had been returned to the Secretary of State as "unclaimed," raised a triable issue of fact as to whether the defendant received notice of the certified mail sent to it by the Secretary of State, and the matter must be remitted for a hearing and new determination of that issue and of the motion and cross motion (see Avila v Distinctive Dev. Co., LLC, ___ AD3d ___ [decided herewith]; Henniger v L.B.X. Excavating, 176 AD2d 917, 918; Rodriguez v Bridge Realty, 155 AD2d 271, 272; Rifenburg v Liffiton Homes, 107 AD2d 1015, 1016).

Contrary to the defendant's contention, the plaintiffs did not waive the issue of the late service of the answer and the alleged default when they failed to reject the answer in a timely manner. Since the plaintiffs notified the defendant that it was in default prior to service of an answer and promptly moved for leave to enter a default judgment after receiving the answer, the plaintiffs could not be deemed to have thereafter waived the issue of late service and the alleged default (see Hosten v Oladapo, 44 AD3d 1006, 1007; Katz v Perl, 22 AD3d 806, 807).

CPLR 3216 [need new notice after NOT/NOI is vacated or stricken]

CPLR 3216

Diemer v Eben Ezer Med. Assoc., 2014 NY Slip Op 05832 [2nd Dept. 2014]

CPLR 3216 permits a court to dismiss an action for want of prosecution only after the court or the defendant has served the plaintiff with a written demand requiring the plaintiff to resume prosecution of the action and to serve and file a note of issue within 90 days after receipt of the demand, and also stating that the failure to comply with the demand will serve as a basis for a motion to dismiss the action. As CPLR 3216 is a legislative creation and not part of a court's inherent power, a court may not dismiss an action for want of prosecution where the plaintiff was not served with the requisite 90-day demand pursuant to CPLR 3216(b) (see Chase v Scavuzzo, 87 NY2d 228, 233; Airmont Homes v Town of Ramapo, 69 NY2d 901, 902; Arroyo v Board of Educ. of City of N.Y., 110 AD3d 17, 20).

Here, the defendants Select Physicians, P.C., and Daniel Reinharth (hereinafter together the defendants) failed to serve a 90-day demand pursuant to CPLR 3216 after the last note of issue was vacated on September 8, 2011, and the action reverted to its pre-note of issue status (see Montalvo v Mumpus Restorations, Inc., 110 AD3d 1045, 1046; Dokaj v Ruxton Tower Ltd. Partnership, 55 AD3d 661, 661-662; Andre v Bonetto Realty Corp., 32 AD3d 973, 974-975; Travis v Cuff, 28 AD3d 749, 750). Contrary to the defendants' contention, the certification orders issued by the Supreme Court, directing the plaintiffs to file a note of issue within 90 days, failed to satisfy CPLR 3216, as each of these orders predated vacatur of the note of issue on September 8, 2011. Further, the plaintiffs complied with each of these certification orders when they served and filed a note of issue within the respective 90-day periods (see CPLR 3216[c]; Darty v Hempstead Vil. Hous. Assoc., 95 AD3d 1161, 1162). Accordingly, the defendants' motion pursuant to CPLR 3216 to dismiss the complaint insofar as asserted against them should have been denied (see Montalvo v Mumpus Restorations, Inc., 110 AD3d at 1046; Sellitto v Women's Health Care Specialists, 58 AD3d 828, 829; Travis v Cuff, 28 AD3d at 750).

CPLR 2001 [must be merely technical]; CPLR 5015(a)(4)

CPLR 2001

CPLR 5015(a)(4)

Segway of N.Y., Inc. v Udit Group, Inc., 2014 NY Slip Op 05971 [2nd Dept. 2014]

However, the Supreme Court erred in applying CPLR 2001 so as to disregard the facial defects in the summons and notice of motion that were identified by the defendants. That section "may be used to cure only a technical infirmity'" (Ruffin v Lion Corp., 15 NY3d 578, 582, quoting Matter of Miller v Board of Assessors, 91 NY2d 82, 87). "In deciding whether a defect in service is merely technical, courts must be guided by the principle of notice to the defendant—notice that must be reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections" (Ruffin v Lion Corp., 15 NY3d at 582 [internal quotation marks omitted]). Where a defect creates a "greater possibility" of frustrating the core principles of notice to the defendant, the defect must be regarded as substantial and courts may not disregard it under CPLR 2001 (id. at 583; see Brown v State of New York, 114 AD3d 632, 633).

Here, the notice of motion for summary judgment in lieu of complaint did not provide timely notice of the motion to the defendant Andrew Udit, who was served by substituted service pursuant to CPLR 308(2), inasmuch as the notice of motion set a return date that was prior to the expiration of the 30-day period within which that defendant was statutorily entitled to appear (see CPLR 320[a]; 3213). Furthermore, the copies of the notice of motion served upon the defendants with the summons pursuant to CPLR 3213 contained an affirmative misstatement of the address at which the motion could be defended (cf. CPLR 2214[a]). We deem it appropriate to take judicial notice (see Consolidated Edison Co. of N.Y. v Public Serv. Commn. of State of N.Y., 47 NY2d 94, 110, revd on other grounds, 447 US 530 and revd sub nom. on other grounds Central Hudson Gas & Elec. Corp. v Public Serv. Comm'n of N.Y., 447 US 557; Appelbaum v Deutsch, 111 AD2d 21, 22, affd 66 NY2d 975; Dougherty v 425 Dev. Assoc., 93 AD2d 438, 447; see also Jerome Prince, Richardson on Evidence §§ 2-202, 2-203 [Farrell 2008]) of the fact that the incorrect address given in the notice of motion pertained to an actual roadway located in Mineola, New York, and was not merely a misspelling of the correct address for the relevant courthouse. As such, the motion for summary judgment in lieu of complaint was made returnable to a location in Mineola at which the Supreme Court was not located, and at which the motion could not have been opposed. These defects in the notice of motion, under the particular circumstances of this case and in the context of an action commenced pursuant to CPLR 3213, created a greater possibility of frustrating the core principles of notice to the defendants (see Ruffin v Lion Corp., 15 NY3d at 583; Brown v State of New York, 114 AD3d at 633). Accordingly, these defects constitute "jurisdictional defect[s] that courts may not overlook" pursuant to CPLR 2001 (Ruffin v Lion Corp., 15 NY3d at 582; see Matter of Cartier v County of Nassau, 281 AD2d 477, 478; Matter of Hawkins v McCall, 278 AD2d 638, 638; Matter of Lincoln Plaza Tenants Corp. v Dinkins, 171 AD2d 577, 577; Matter of Common Council of City of Gloversville v Town Bd. of Johnstown, 144 AD2d 90, 92). Since the Supreme Court failed to acquire personal jurisdiction, "all subsequent proceedings are thereby rendered null and void" (Emigrant Mtge. Co., Inc. v Westervelt, 105 AD3d 896, 897 [internal quotation marks omitted]), and the default judgment entered against the defendants is "a nullity" (Prudence v Wright, 94 AD3d 1073, 1074; see Krisilas v Mount Sinai Hosp., 63 AD3d 887, 889; Harkless v Reid, 23 AD3d 622, 623; Steele v Hempstead Pub Taxi, 305 AD2d 401, 402).

Accordingly, the defendants' motion to vacate the judgment dated January 13, 2012, and thereupon to dismiss the action for lack of personal jurisdiction, should have been granted (see CPLR 5015[a][4]).

CPLR 3212(f); 3126; staged accident

CPLR 3212(f)

CPLR 3126

Johnson v Richardson, 2014 NY Slip Op 05956 [2nd Dept. 2014]

"A party opposing summary judgment is entitled to obtain further discovery when it appears that facts supporting the opposing party's position may exist but cannot then be stated" (James v Aircraft Serv. Intl. Group, 84 AD3d 1026, 1027 [internal quotation marks omitted]; see CPLR 3212[f]; Wesolowski v St. Francis Hosp., 108 AD3d 525, 526; Jones v American Commerce Ins. Co., 92 AD3d 844, 845; Juseinoski v New York Hosp. Med. Ctr. of Queens, 29 AD3d 636, 637). "This is especially so where the opposing party has not had a reasonable opportunity for disclosure prior to the making of the motion" (Baron v Incorporated Vil. of Freeport, 143 AD2d 792, 793; see Wesolowski v St. Francis Hosp., 108 AD3d at 526; James v Aircraft Serv. Intl. Group, 84 AD3d at 1027).

Here, the plaintiffs' motion for leave to reargue was made prior to the parties conducting depositions. U-Haul asserts that the accident was "staged" by the plaintiffs and Richardson, and, thus, U-Haul was not liable for negligence. Since U-Haul had no personal knowledge of the relevant facts, it should be afforded the opportunity to conduct discovery, including depositions of the plaintiffs and the defendant Richardson. Accordingly, it was premature to award summary judgment at this stage of the action (see Wesolowski v St. Francis Hosp., 108 AD3d at 526; Jones v American Commerce Ins. Co., 92 AD3d at 845; Gardner v Cason, Inc., 82 AD3d 930, 931-932; Adler v City of New York, 52 AD3d 549, 549-550).

 

Judgments [money and real]

CPLR 211

CPLR 5203

CPLR 5014

Guerra v Crescent St. Corp., 2014 NY Slip Op 05948 [2nd Dept. 2014]

"Since a money judgment is viable for 20 years, but a lien on real property is only effective for 10 years (see CPLR 211[b]; 5203[a]), the Legislature enacted CPLR 5014 to allow a judgment creditor to apply for a renewal of the lien by commencing an action for a renewal judgment" (Schiff Food Prods., Co, Inc., v M & M Import Export, 84 AD3d 1346, 1347-1348; see Gletzer v Harris, 12 NY3d 468, 473; Rose v Gulizia, 104 AD3d 757, 757-758; Premier Capital, LLC v Best Traders, Inc., 88 AD3d 677, 678). "Pursuant to CPLR 5014(1), an action upon a money judgment may be maintained between the original parties where ten years have elapsed since the judgment was originally docketed" (Pangburn v Klug, 244 AD2d 394, 395; see Premier Capital, LLC v Best Traders, Inc., 88 AD3d at 678). Thus, an action for a renewal judgment is not time-barred even when it is commenced more than 10 years after the original judgment was docketed (see Schiff Food Prods. Co., Inc. v M & M Import Export, 84 AD3d at 1348).

Here, instead of commencing a new action, as required by CPLR 5014, the plaintiff moved in the instant, original action to renew the judgment lien. In view of the plaintiff's failure to commence a new action and thereby satisfy the procedural requirement of CPLR 5014, the Supreme Court properly denied that branch of her motion which was to renew the judgment lien on the subject property.