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THE FRAUDULENT-CONVEYANCE CAUSES OF ACTION INVOLVED CONNECTICUT PROPERTIES AND WERE TIME-BARRED IN CONNECTICUT; NEW YORK’S BORROWING STATUTE RENDERED THE ACTIONS TIME-BARRED IN NEW YORK (FIRST DEPT).

The First Department, reversing Supreme Court, determined the fraudulent-conveyances causes of action should have been dismissed as time-barred under New York’s borrowing statute. The properties which were conveyed are in Connecticut and the action is time-barred under Connecticut law:

Plaintiff’s claims are time-barred pursuant to CPLR 202, New York’s borrowing statute. Under CPLR 202, where a nonresident plaintiff asserts causes of action in a New York court, “the claim must be timely under both New York and the jurisdiction where the action accrued” … . “Consequently, . . . it is the shorter of the two states’ statutes of limitations that controls the timeliness of the action” … . For purposes of CPLR 202, “a cause of action accrues at the time and in the place of the injury” and “[w]hen an alleged injury is purely economic, the place of injury is usually where the plaintiff resides and sustains the economic impact of the loss” … .

Here, plaintiff is a resident of Connecticut and alleges only economic injury. Moreover, it does not dispute that, under Connecticut law, where the claims accrued for purposes of the borrowing statute, the statute of limitations for the asserted causes of action has expired (see Conn Gen Stat § 52-552j …). National Auditing Servs. & Consulting, LLC v Assa, 2023 NY Slip Op 03198, First Dept 6-13-23

Practice Point: Causes of action which accrued in another state must be timely under both that state’s and New York’s statutes of limitations.

 

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