Category: Judicial estoppel

Judicial Estoppel

Bihn v Connelly, 2018 NY Slip Op 03956 [2d Dept. 2018]

Under the doctrine of judicial estoppel, also known as estoppel against inconsistent positions, a party may not take a position in a legal proceeding that is contrary to a position he or she took in a prior proceeding, simply because his or her interests have changed (see Festinger v Edrich, 32 AD3d 412, 413; McCaffrey v Schaefer, 251 AD2d 300, 301; Ford Motor Credit Co. v Colonial Funding Corp., 215 AD2d 435, 436). The doctrine applies only where the party secured a judgment in his or her favor in the prior proceeding (see State Farm Mut. Auto. Ins. Co. v Allston, 300 AD2d 669, 670; Tilles Inv. Co. v Town of Oyster Bay, 207 AD2d 393, 394). This doctrine "rests upon the principle that a litigant should not be permitted . . . to lead a court to find a fact one way and then contend in another judicial proceeding that the same fact should be found otherwise'" (Ford Motor Credit Co. v Colonial Funding Corp., 215 AD2d at 436, quoting Environmental Concern v Larchwood Constr. Corp., 101 AD2d 591, 593). "The doctrine is invoked to estop parties from adopting such contrary positions because the judicial system cannot tolerate this playing fast and loose with the courts" (Ford Motor Credit Co. v Colonial Funding Corp., 215 AD2d at 436 [internal quotation marks omitted]).

Judicial Estoppel

Wells Fargo Bank N.A. v Webster Bus. Credit Corp., 2014 NY Slip Op 00412 [1st Dept. 2014]

Contrary to defendant's argument, plaintiffs' previous assertion of their own claim for contractual indemnification does not judicially estop them from denying that defendant is entitled to indemnification of attorneys' fees under the agreement. The doctrine of judicial estoppel " precludes a party who assumed a certain position in a prior legal proceeding and who secured a judgment in his or her favor from assuming a contrary position in another action simply because his or her interests have changed'" (Jones Lang Wootton USA v LeBoeuf, Lamb, Greene & MacRae, 243 AD2d 168, 176 [1st Dept 1998], lv dismissed 92 NY2d 962 [1998] [quoting Ford Motor Credit Co. v Colonial Funding Corp., 215 AD2d 435, 436 [2d Dept 1995]). As plaintiffs did not prevail on their contractual indemnification claim, the doctrine of judicial estoppel does not apply (see Kvest LLC v Cohen, 86 AD3d 481, 482 [1st Dept 2011]; Gale P. Elston, P.C. v Dubois, 18 AD3d 301, 303 [1st Dept 2005]).

Nor does plaintiffs' prior claim for contractual indemnification, standing alone, constitute a "judicial admission" that attorneys' fees are recoverable in inter-party disputes. On the contrary, plaintiffs' former construction of the agreement was a legal argument, and not a "fact" amenable to treatment as a "formal judicial admission" (GJF Constr., Inc. v Sirius Am. Ins. Co., 89 AD3d 622, 626 [1st Dept 2011]).

Emphasis is mine (the bolded portion only) (italics in original).

Rj and CJ and JE and EE

DirecTV Latin Am., LLC v Pratola, 2012 NY Slip Op 03098 (1st Dept., 2012)

The issue whether New York courts have personal jurisdiction over defendants Pratola and Clemente pursuant to CPLR 301 and 302 was determined in the prior federal action and, pursuant to the doctrine of collateral estoppel, may not be relitigated (see Keeler v West Mtn. Corp., 105 AD2d 953, 955 [1984]). Although plaintiff Latin American Sports, LLC was not a party to the federal action, it may be collaterally estopped because it is a
limited liability company wholly owned by DirecTV, and its interests with respect to the claims against defendants are identical to those of DirecTV (see D'Arata v New York Cent. Mut. Fire Ins. Co., 76 NY2d 659, 664 [1990]).

No determination was made in the federal action as to personal jurisdiction over defendant Zunda, allegedly a citizen of the United States with a domicile in Argentina, who, until his termination, was employed as a senior officer at DirecTV Argentina, a subsidiary of DirecTV. Plaintiffs' sole allegation in support of their position is that defendants deposited funds into a New York bank account owned by Clemente, from which they funneled money to Pratola and Zunda. This is insufficient to invoke personal jurisdiction over Zunda pursuant to CPLR 302(a)(l), which authorizes exercise of personal jurisdiction over a non-domiciliary who "transacts any business within the state" (see Pramer S.C.A. v Abaplus Intl. Corp., 76 AD3d 89, 96 [2010]).

Gonzalez v City of New York, 2012 NY Slip Op 02791 (1st Dept., 2012)

Contrary to plaintiff's argument, the City is not equitably estopped from claiming that it is not a proper party. In its answer, the City specifically denied plaintiff's allegations that it controlled, maintained, or managed the school premises, or had any duty to remove snow and ice from the grounds (see Flores v City of New York, 62 AD3d 506 [2009]). That denial should have alerted plaintiff that she had sued the wrong party, and, when the City served the answer, plaintiff had adequate time to seek leave to file a late notice of claim naming the correct defendant.

The circumstances of this case can be readily distinguished from those of Padilla v Department of Educ. of the City of N.Y. (90 AD3d 458 [2011]), which concerned another injury on the grounds of a City public school. In Padilla, we held that the doctrine of equitable estoppel barred the City from denying that it was a proper party because its answer did not alert the plaintiff that it lacked control over the school premises, but instead merely objected that the attempted service of the notice of claim was improper (90 AD3d at 458). We also found that, [*2]after the notice of claim was filed, the City's wrongful or negligent actions discouraged the plaintiff from serving a timely amended notice of claim (id. at 459).

Truong v Litman, 2012 NY Slip Op 02172 (1st Dept., 2012)

Dismissal of this action was proper as it is barred by the doctrine of res judicata (see generally O'Brien v City of Syracuse, 54 NY2d 353 [1981]). The transactions upon which this action is premised were the subject of prior claims brought by and concluded against plaintiffs in both state and federal court (see id. at 357; Elias v Rothschild, 29 AD3d 448 [2006]). Contrary to plaintiffs' argument, the claims alleging violations of plaintiffs' civil rights under 42 USC § 1983 and § 1985 were decided against plaintiffs on the merits and the breach of contract claim was fully litigated and decided against plaintiffs in Civil Court, New York County.

Pierre v Mary Manning Walsh Nursing Home Co., Inc., 2012 NY Slip Op 02060 (1st Dept., 2012)

Defendants' federal preemption claim is unavailing, as the Labor Management Relations Act (29 USCS § 185) has preclusive effect only when resolution of a state law claim is substantially dependent upon the analysis of a CBA (Allis-Chalmers Corp. v Lueck, 471 US 202, 220 [1985]). Here, as explained, the CBA relied upon by defendants when seeking to compel arbitration is not applicable to plaintiffs. Contrary to defendants' urging, plaintiffs' subsequent action to compel arbitration, which was unsuccessful, does not compel invocation of the doctrine of judicial estoppel, as they have not "secured a judgment in [their] favor" by assuming "a certain position in a prior legal proceeding," and then assumed "a contrary position in another action simply because [their] interests have changed" (Jones Lang Wootton USA v LeBoeuf, Lamb, Greene & MacRae, 243 AD2d 168, 176 [1998], lv dismissed 92 NY2d 962 [1998]).

Zurich Am. Ins. Co. v Illinois Natl. Ins. Co., 2012 NY Slip Op 02065 (1st, 2012)

Plaintiffs' argument that Illinois National is equitably estopped to deny coverage to Moretrench is unsupported by the record (see River Seafoods, Inc. v JPMorgan Chase Bank, 19 AD3d 120, 122 [2005]). The documentary evidence does not establish that Illinois National (through its agents) ever conceded that Moretrench was covered during the relevant period (2006). Nor could Moretrench have relied on any such concession years after the underlying complaint was filed and Illinois National disclaimed coverage. Moreover, Moretrench cannot invoke equitable estoppel against Illinois National on the basis of promises made by defendant [*2]Urban Foundation Engineering, LLC (the contractor that subcontracted with Moretrench).

Anderson v New York City Dept. of Educ., 2012 NY Slip Op 02056 (1st Dept., 2012)

The complaint was properly dismissed as barred by the doctrine of res judicata. Plaintiff's action arose out of the same set of circumstances as his prior article 78 proceeding, which was dismissed. "[O]nce a claim is brought to a final conclusion, all other claims arising out of the same transaction or series of transactions are barred, even if based upon different theories or if seeking a different remedy" (O'Brien v City of Syracuse, 54 NY2d 353, 357 [1981]; see Daved Fire Sys. Inc. v New York City Health & Hosps. Corp., 46 AD3d 364 [2007]).

Gomez v Brill Sec., Inc., 2012 NY Slip Op 01877 (1st Dept., 2012)

Hough v USAA Cas. Ins. Co., 2012 NY Slip Op 01549 (1st Dept., 2012)

Defendant's disclaimer of its duty to defend its insured in the underlying action does not bar it from asserting that its insured injured plaintiff intentionally, because that assertion is not a defense extending to the merits of plaintiff's personal injury claims against the insured (see Robbins v Michigan Millers Mut. Ins. Co., 236 AD2d 769, 771 [1997]). Since the underlying action culminated in a default judgment and the issue whether the insured's acts were intentional or negligent was not litigated, defendant is not collaterally estopped to assert in this action that its insured caused plaintiff's injuries intentionally (see id.). There is support for this assertion in the record (compare Rucaj v Progressive Ins. Co., 19 AD3d 270, 273 [2005] [insurer's defenses rejected as a matter of law]).

Since issues of fact exist whether the underlying incident was an "occurrence" within the meaning of the policy, i.e., an accident, or an intentional act outside the scope of coverage, which would render a disclaimer pursuant to Insurance Law § 3420(d) unnecessary, it cannot yet be determined whether defendant's noncompliance with the statute precludes it from disclaiming coverage (see Matter of Worcester Ins. Co. v Bettenhauser, 95 NY2d 185, 188-189 [2000]; Seneca Ins. Co. v Naprawa, 294 AD2d 183 [2002]).

Estoppels abound

Maybaum v Maybaum, 2011 NY Slip Op 07816 (2nd Dept., 3011)

The Supreme Court erred in granting that branch of the plaintiff's motion which was to strike stated paragraphs of the defendant's counterclaim on the grounds of res judicata, collateral estoppel, and equitable estoppel. The allegations in the defendant's counterclaim for a divorce on the ground of cruel and inhuman treatment, and the allegations in the plaintiff's family offense petition, did not arise out of the same transaction or series of transactions. "It is not always clear whether particular claims are part of the same transaction for res judicata purposes. A pragmatic' test has been applied to make this determination—analyzing whether the facts are related in time, space, origin, or motivation, whether they form a convenient trial unit, and whether their treatment as a unit conforms to the parties' expectations or business understanding or usage'" (Xiao Yang Chen v Fischer, 6 NY3d 94, 100-101, quoting Restatement [Second] of Judgments § 24[2]; see Smith v Russell Sage Coll., 54 NY2d 185, 192-193). Applying this test, we conclude that the family offense petition and counterclaim for a divorce on the ground of cruel and inhuman treatment do not form a convenient trial unit. Thus, the defendant is not precluded from litigating her counterclaim for a divorce on the ground of cruel and inhuman treatment in the separate action in the Supreme Court. 

"Collateral estoppel, or issue preclusion, precludes a party from relitigating in a subsequent action or proceeding an issue clearly raised in a prior action or proceeding and decided against that party . . . , whether or not the tribunals or causes of action are the same'" (Parker v Blauvelt Volunteer Fire Co., 93 NY2d 343, 349, quoting Ryan v New York Tel. Co., 62 NY2d 494, 500). "The doctrine applies if the issue in the second action is identical to an issue which was raised, necessarily decided and material in the first action, and the plaintiff had a full and fair opportunity to litigate the issue in the earlier action" (Parker v Blauvelt Volunteer Fire Co., 93 NY2d at 349). "[C]ollateral estoppel effect will only be given to matters actually litigated and determined in a prior action" (Kaufman v Eli Lilly & Co., 65 NY2d 449, 456 [internal quotation marks omitted]). "An issue is not actually litigated if, for example, there has been a default, a confession of liability, a failure to place a matter in issue by proper pleading or even because of a stipulation" (id. at 456-457). Here, the issue of whether the plaintiff committed certain acts against the defendant was never determined in the Family Court proceeding, and the defendant's participation in the stipulation to withdraw her family offense petition, with prejudice, cannot be construed to be the kind of determination following a full and fair opportunity to litigate the issues that would be necessary to collaterally estop the defendant from establishing that the plaintiff committed the alleged acts (see North Shore-Long Is. Jewish Health Sys., Inc. v Aetna US Healthcare, Inc., 27 AD3d 439, 440-441; Singleton Mgt. v Compere, 243 AD2d 213, 216-218).

Further, "[t]he circumstances set forth by plaintiff simply do not rise to a level of unconscionability warranting application of equitable estoppel" (American Bartenders School v 105 Madison Co., 59 NY2d 716, 718; see Geller v Reuben Gittelman Hebrew Day School, 34 AD3d 730, 731-732).

Since the doctrines of res judicata, collateral estoppel, and equitable estoppel do not preclude the defendant from litigating certain of the allegations in her counterclaim that were alleged in her family offense petition, the Supreme Court should have granted that branch of the defendant's cross motion which was pursuant to CPLR 3211(b) to dismiss the plaintiff's fourth affirmative defense alleging that the defendant's counterclaim was barred in whole or in part by the doctrines of res judicata, collateral estoppel, and equitable estoppel, as that defense has no merit.

The Supreme Court further erred in granting that branch of the plaintiff's motion which was to strike stated paragraphs of the defendant's counterclaim, in effect, as time-barred on the ground they alleged acts occurring more than five years prior to the commencement of the action. The allegations in the counterclaim relating to incidents occurring more than five years before the commencement of the action may be properly included to the extent that those allegations may be relevant to an evaluation of a party's claim for a divorce on the ground of cruel and inhuman treatment in the context of the entire marriage (see Vestal v Vestal, 273 AD2d 461, 462; Miglio v Miglio, 147 AD2d 460, 460-461). Further, the Supreme Court erred in granting that branch of the plaintiff's motion which was pursuant to CPLR 3016(c) to strike stated paragraphs in the counterclaim for lack of specificity and thereupon directing the defendant to serve and file an amended counterclaim. The "allegations sufficiently apprised the [plaintiff] of the accusations against him so as to enable him to prepare a defense" (Nolletti v Nolletti, 2 AD3d 421, 422; see Kapchan v Kapchan, 104 AD2d 358; Pfeil v Pfeil, 100 AD2d 725). Therefore, the Supreme Court also should have granted that branch of the defendant's cross motion which was pursuant to CPLR 3211(b) to dismiss the plaintiff's third affirmative defense alleging that the counterclaim was insufficiently specific to meet the requirements of CPLR 3016(c).

Farren v Lisogorsky, 2011 NY Slip Op 06366 (2nd Dept., 2011)

Prior to answering, the defendant moved to dismiss the complaint pursuant to CPLR 3211(a)(5) and (7), for summary judgment dismissing the complaint, and for an award of sanctions. The Supreme Court, inter alia, granted that branch of the motion which was to dismiss the complaint pursuant to CPLR 3211(a)(5), holding that the doctrine of res judicata precluded the instant action. We reverse the order insofar as appealed from. 

" [T]he general doctrine of res judicata gives binding effect to the judgment of a court of competent jurisdiction and prevents the parties to an action, and those in privity with them, from subsequently relitigating any questions that were necessarily decided therein'" (Landau, P.C. v LaRossa, Mitchell, & Ross, 11 NY3d 8, 13, quoting Matter of Grainger [Shea Enters.], 309 NY 605, 616). Although the doctrine of res judicata may be invoked where there is either a final judgment in an action between the parties, or a stipulation of settlement withdrawing a complaint or cause of action with prejudice (see Liberty Assoc. v Etkin, 69 AD3d 681, 682-683), to establish "privity" of the kind required for the application of res judicata, the party raising a res judicata defense must demonstrate a connection between the party to be precluded and a party to the prior action "such that the interests of the nonparty can be said to have been represented in the prior proceeding" (Green v Santa Fe Indus., 70 NY2d 244, 253).

The doctrine of res judicata is inapplicable to the instant action, as the plaintiffs never asserted any claim against the defendant in his capacity as an employee of Metropolitan, and seek here to hold him liable solely in his professional capacity as a pharmacist (see City of New York v Welsbach Elec. Corp., 9 NY3d 124, 127-128; Pawling Lake Prop. Owners Assn., Inc. v Greiner, 72 AD3d 665). The fact that the plaintiffs sued one tortfeasor, Metropolitan, does not automatically preclude them from suing another tortfeasor, such as the defendant herein, in a subsequent action (see Seaman v Fichet-Bauche N. Am., 176 AD2d 793, 794). In addition, the defendant inaptly sought to invoke res judicata against the plaintiffs based on his alleged privity with Metropolitan. Since there was an insufficient basis upon which to conclude that the defendant was in privity with Metropolitan, the Supreme Court incorrectly granted that branch of the defendant's motion which was pursuant to CPLR 3211(a)(5) to dismiss the complaint based on the doctrine of res judicata.

Uzamere v Senator Ehigie Edobor Uzamere, 2011 NY Slip Op 08583 (2nd Dept., 2011)

The Supreme Court properly directed dismissal of the complaint based on the doctrine of res judicata. The plaintiff previously commenced two prior federal court actions, one in the Eastern District of New York (hereinafter the Eastern District action) and one in the Southern District of New York based on the same alleged facts that form the basis of the complaint herein. In light of authority stating that a court should apply the rules of res judicata followed in the jurisdiction that rendered the earlier court decision (see Insurance Co. of State of Pa. v HSBC Bank USA, 10 NY3d 32, 38 n 3, citing Marrese v American Academy of Orthopaedic Surgeons, 470 US 373, 380-381; Langerman v Langerman, 303 NY 465, 474; Restatement [Second] of Conflict of Laws § 95, Comment[e]), we apply federal res judicata law in determining whether the doctrine of res judicata bars this action.

"In federal court, subsequent litigation is prohibited if a prior court ruling was (1) a final judgment on the merits, (2) by a court of competent jurisdiction, (3) in a case involving the same parties or their privies, and (4) involving the same cause of action'" (Insurance Co. of State of Pa. v HSBC Bank USA, 10 NY3d at 37, quoting EDP Med. Computer Sys., Inc. v United States, 480 F3d 621, 624).

Here, the Eastern District action resulted in a dismissal of the complaint for failure to state a claim upon which relief could be granted, and that dismissal was a final adjudication on the merits by a court of competent jurisdiction (see Federated Department Stores, Inc. v Moitie, 452 US 394, 399 n 3; Angel v Bullington, 330 US 183, 190). Furthermore, the Eastern District action and this action involve the same parties or their privies (see Akhenaten v Najee, LLC, 544 F Supp 2d 320, 328-329), and involve the same cause of action. Specifically, the Eastern District complaint and the instant complaint arise out of the same "nucleus of operative facts" and, thus, the causes of action asserted in this litigation could have been asserted in the Eastern District action (Waldman v Village of Kiryas Joel, 207 F3d 105, 108). Moreover, under the circumstances of this case, it is not clear that the Eastern District would have, as a matter of discretion, declined to exercise supplemental jurisdiction over the State law causes of action asserted herein (see Troy v Goord, 300 AD2d 1086; cf. McLearn v Cowen & Co., 48 NY2d 696, 698; Urlic v Insurance Co. of State of Penn., 259 AD2d 1, 4).

Sumry Judments with a little RJ and JE, all in the 1st Department. One bit of EE in the 2nd.

CPLR R. 3212

Lance Intl., Inc. v First Natl. City Bank, 2011 NY Slip Op 05982 (1st Dept., 2011) 

Contrary to defendant's contention, its defense is that plaintiff lacks capacity to sue, not that the court lacks subject matter jurisdiction (see Security Pac. Natl. Bank v Evans, 31 AD3d 278, 279-280 [2006], appeal dismissed 8 NY3d 837 [2007]). Contrary to plaintiff's contention, Civil Court did not raise the issue of lack of capacity sua sponte.

While a defense that a party lacks capacity to sue (see CPLR 3211[a][3]) is waived if not raised in a pre-answer motion or in a responsive pleading (see CPLR 3211[e]), plaintiff's lack of capacity did not arise until after joinder of issue, and therefore, defendant did not waive that defense (see George Strokes Elec. & Plumbing v Dye, 240 AD2d 919, 920 [1997]).

A defendant may move for summary judgment based on an unpleaded defense (see e.g. Rogoff v San Juan Racing Assn., 54 NY2d 883, 885 [1981]). Plaintiff can hardly claim prejudice or surprise from defendant's assertion that it lacked capacity to sue. In 1995, it moved to substitute its president as the plaintiff, arguing that he was "the real party in interest by virtue of the dissolution of the corporation."

Defendant's underlying motion for summary judgment was timely (see CPLR 3212[a]). Plaintiff has supplied no proof in the record that Civil Court required defendant to file its summary judgment motion by July 21, 2008. Even if, arguendo, one judge of the Civil Court ordered defendant to file its motion by July 21, 2008, this order was superseded by the parties' October 16, 2008 stipulation, which set a briefing schedule for the motion and was so-ordered by another judge of the Civil Court.

Plaintiff's original note of issue, which was filed on October 19, 2007, "was, in effect, nullifed" (Negron v Helmsley Spear, Inc., 280 AD2d 305 [2001]) when the action was removed from the trial calendar. Therefore, the operative note of issue is the one filed on April 25, 2008 (see Williams v Peralta, 37 AD3d 712, 713 [2007]), and the motion was timely.

Montolio v Negev LLC, 2011 NY Slip Op 05985 (1st Dept., 2011)

Furthermore, although Negev's answer is contained in the record, it is verified only by counsel. The motion also is supported only by counsel's affirmation; no submission was made by anyone with personal knowledge (Lopez v Crotona Ave. Assoc., LP, 39 AD3d 388, 390 [2007]).

 

RJ and JD

 

UBS Sec. LLC v Highland Capital Mgt., L.P., 2011 NY Slip Op 05979 (1st Dept., 2011)

The parties appealed, presenting us with the question whether and to what extent the doctrine of res judicata applies to these circumstances. The doctrine dictates that, "as to the parties in a litigation and those in privity with them, a judgment on the merits by a court of competent jurisdiction is conclusive of the issues of fact and questions of law necessarily decided therein in any subsequent action" (Gramatan Home Inv. Corp. v Lopez, 46 NY2d 48l, 485 [1979]). It used to be the rule that, even if the two actions arose out of an identical course of dealing, the second was not barred by res judicata if "the requisite elements of proof and hence the evidence necessary to sustain recovery var[ied] materially" (Smith v Kirkpatrick, 305 NY 66, 72 [1953]). However, the Court of Appeals expressly rejected that method of analysis in O'Brien v City of Syracuse (54 NY2d 353 [1981]). There it held that "once a claim is brought to a final conclusion, all other claims arising out of the same transaction or series of transactions are barred, even if based upon different theories or if seeking a different remedy" (54 NY2d at 357). The Court further stated: 

"[w]hen alternative theories are available to recover what is essentially the same relief for harm arising out of the same or related facts such as would constitute a single factual grouping' (Restatement, Judgments 2d, § 61 [Tent Draft No. 5]), the circumstance that the theories involve materially different elements of proof will not justify presenting the claim by two different actions" (id. at 357-358).

Notably, regarding this point, the Court stated in a footnote that, insofar as Smith (305 NY at 66) "may be to the contrary, it is overruled" (id.). Whether facts are deemed to constitute a single factual grouping for res judicata purposes "depends on how the facts are related in time, space, origin, or motivation, whether they form a convenient trial unit, and whether . . . their treatment as a unit conforms to the parties' expectations or business understanding or usage" (Smith v Russell Sage Coll., 54 NY2d 185, 192-193 [1981] [internal quotation marks and citations omitted]).

Here, to the extent the claims against Highland in the new complaint implicate events alleged to have taken place before the filing of the original complaint, res judicata applies. That is because UBS's claims against Highland in the original action and in this action all arise out of the restructured warehousing transaction. While the claim against Highland in the original action was based on Highland's alleged obligation to indemnify UBS for actions taken by the affiliated funds, and the claims against Highland in the second action arose out of Highland's alleged manipulation of those funds, they form a single factual grouping. Both are related to the same business deal and to the diminution in the value of the securities placed with UBS as a result of that deal. Thus, the claims form a convenient trial unit. Moreover, it can hardly be said that the claims in the two actions are so unrelated that reasonable business people, not to mention the parties themselves, would have expected them to be tried separately (see Smith, 54 NY2d at 192-193). Also, we note that, when seeking permission to amend the complaint, UBS itself asserted that "the new causes of action arise out of the same or related circumstances and events as UBS's pending claims."

Further, the Court of Appeals' holding in Xiao Yang Chen v Fischer (6 NY3d 94 [2005]) [*6]does not support UBS's position. Nor does it represent a shift in res judicata jurisprudence, as UBS argues. The circumstances of this case bear no resemblance to those in Xiao Yang Chen, which involved a woman who, in a previously filed separate action, was granted a divorce on the ground of cruel and inhuman treatment. In the divorce action, the plaintiff supported her cruel and inhuman treatment claim with an allegation that her husband had slapped her, causing injury. While the divorce action was pending, the plaintiff commenced a separate personal injury action seeking damages for the intentional infliction of emotional distress and injuries arising out of the alleged assault. In finding that res judicata did not bar the personal injury action, the Court of Appeals noted that the two actions sought different types of relief and did not constitute a convenient trial unit. The Court of Appeals also noted other significant distinctions, such as the facts that divorce actions are typically decided by a judge and that attorneys in personal injury actions may be compensated by a contingency fee, and the policy consideration of expediting divorce proceedings. None of those considerations applies here, where the action seeks money damages arising only in connection with a commercial transaction. 

While we have concluded that res judicata bars the claims in this action, we still must address UBS's assertion that it would be fundamentally unfair to apply res judicata under the circumstances of this case. UBS bases this argument primarily on the contention that it would have moved to amend the complaint in the original action while that action was still in existence (i.e., before this Court dismissed it), but for the necessity that it comply with the Commercial Part rules requiring that it first seek permission in a letter. However, this argument fails because, even had they made such a motion, the ultimate result would have been the same. As evidenced by the affidavit of its former employee, UBS was aware of the facts that support the claims in this action as long ago as November 2008. That was before UBS filed the original action.

Indeed, the evidence that the former employee admits had been gathered by UBS at that time supports all the claims asserted against Highland in this action. That UBS received additional evidence in the document production that Highland made shortly before UBS sought to amend its complaint is irrelevant. The proper inquiry for res judicata purposes is when UBS could have raised a cause of action, not when it had enough evidence to prove the claim at trial (see Castellano v City of New York, 251 AD2d 194, 195 [1998], lv denied 92 NY2d 817 [1998], cert denied 526 US 1131 [1999]). In this regard, we note that, based on what it admits it knew in November 2008, UBS could have pleaded its fraud claim with the requisite particularity at that time, since the facts available would have permitted a "reasonable inference of the alleged conduct" (Pludeman v Northern Leasing Sys., Inc., 10 NY3d 486, 492 [2008]). Because UBS could have asserted the instant claims in the original complaint or moved to amend well before that complaint was dismissed by this Court, we are not persuaded that the Rules of the Commercial Part affected the eventual result. Nevertheless, to the extent that the third and fourth causes of action, alleging breach of the covenant of good faith and fair dealing and fraudulent conveyance, respectively, rely on conduct alleged to have occurred after the commencement of the prior action, such claims should be allowed.

Nor do we share the motion court's concern that it is unfair to apply res judicata where Highland remains a party to the action by dint of its counterclaims. It would likewise be unjust to hold that a defendant that chooses to assert a counterclaim forfeits its right to assert the defense of res judicata with respect to the main claims. Indeed, to so hold would deal a blow to judicial economy since counterclaims are not compulsory in New York (67-25 Dartmouth St. Corp. v Syllman, 29 AD3d 888, 889 [2006]), and defendants would merely assert their own [*7]claims in separate actions to avoid the application of res judicata.

Kvest LLC v Cohen, 2011 NY Slip Op 05984 (1st Dept., 2011)

Plaintiff is not barred by the doctrine of judicial estoppel from asserting that the disclaimer is valid because it did not prevail in the declaratory judgment action (see Rothstein & Hoffman Elec. Serv., Inc. v Gong Park Realty Corp., 37 AD3d 206, 207 [2007], lv denied 8 NY3d 812 [2007]; Jones Lang Wootton USA v LeBoeuf, Lamb, Greene & MacRae, 243 AD2d 168, 176 [1998], lv dismissed 92 NY2d 962 [1998]). However, contrary to plaintiff's argument, the doctrine of collateral estoppel does not bind defendants to the declaratory judgment court's determination that defendants did not timely notify the carrier of the claim letter. Defendants were not parties to that action. The doctrine of collateral estoppel is binding only upon parties or their privies who have had a full and fair opportunity to litigate issues determined in prior proceedings (see Gramatan Home Invs. Corp. v Lopez, 46 NY2d 481, 485-486 [1979]).

Defendants state in their affidavit that they mailed a copy of the claim letter to the carrier [*2]on May 6, 2004, two days after they received it from plaintiff. However, a notice of occurrence/claim form prepared by defendants on October 2, 2004 indicates that the claim had not previously been reported. This raises a triable issue of fact as to whether defendants timely notified the carrier of the claim letter. 

Contrary to defendants' assertion, the damages recoverable in this action can include plaintiff's reasonable attorneys' fees incurred in defending the carrier's declaratory judgment action in its effort to mitigate its damages (see Martini v Lafayette Studio Corp., 273 AD2d 112, 114 [2000]). On the other hand, the breach of fiduciary duty cause of action was properly dismissed as the facts establish that the parties had nothing more than a typical insurance broker-customer relationship (see e.g. Murphy v Kuhn, 90 NY2d 266, 270-271 [1997]).

Equitable estoppel

Giannetto v Knee, 82 AD3d 1043 (2nd Dept. 2011)

The Supreme Court erred, however, in granting that branch of the defendants' motion which was for summary judgment dismissing the malpractice cause of action against Knee on the basis of the statute of limitations. Although the defendants established, prima facie, that the action was commenced well beyond the 2½-year statute of limitations applicable to claims alleging dental malpractice (see CPLR 214-a), the plaintiff raised a triable issue of fact as to whether Knee should be equitably estopped from raising the defense of the statute of limitations. "Equitable estoppel is appropriate where the plaintiff is prevented from filing an action within the applicable statute of limitations due to his or her reasonable reliance on deception, fraud or misrepresentations by the defendant" (Putter v North Shore Univ. Hosp., 7 NY3d 548, 552-553 [2006]; see Simcuski v Saeli, 44 NY2d at 448-449). Whether equitable estoppel applies is generally a question of fact (see Vigliotti v North Shore Univ. Hosp., 24 AD3d 752, 755 [2005]), and a mere failure to disclose malpractice or diagnose a condition does not give rise to equitable estoppel (see Rizk v Cohen, 73 NY2d 98 [1989]; Simcuski v Saeli, 44 NY2d at 450; Reichenbaum v Cilmi, 64 AD3d 693, 695 [2009]; Bevinetto v Steven Plotnick, M.D., P.C., 51 AD3d 612, 614 [2008]; Dombroski v Samaritan Hosp., 47 AD3d 80 [2007]; Coopersmith v Gold, 172 AD2d 982, 983 [1991]). Here, the plaintiff's sworn allegations raised a triable issue of fact as to whether Knee concealed his malpractice by knowingly misrepresenting her condition and by bonding tooth number 21, a procedure that the plaintiff alleges he knew was not effective (see Vigliotti v North Shore Univ. Hosp., 24 AD3d at 755; Szajna v Rand, 131 AD2d 840, 841 [1987]). Additionally, the plaintiff raised a triable issue of fact as to whether she commenced the action within a reasonable time after her discovery of the alleged malpractice (see Edmonds v Getchonis, 150 AD2d 879, 882 [1989]).

 

Judicial estoppel

Ferreira v Wyckoff Hgts. Med. Ctr., 2011 NY Slip Op 00641 (App. Div., 2nd 2011)

WHMC's contention that the doctrine of judicial estoppel barred the plaintiff from arguing at trial that the decedent was stillborn is without merit. The doctrine of judicial estoppel will [*2]be applied when a party has secured a judgment in his or her favor by adopting the prior position, and then has sought to assume a contrary position simply because his or her interests have changed (see Matter of One Beacon Ins. Co. v Espinoza, 37 AD3d 607; Matter of State Farm Mut. Auto. Ins. Co. v Allston, 300 AD2d 669; Bono v Cucinella, 298 AD2d 483). Although the plaintiff previously argued that the decedent was born alive, the plaintiff never obtained a judgment in her favor by adopting that position. Therefore, judicial estoppel did not bar the plaintiff from arguing at trial that the decedent was stillborn.

The bold is mine.