Page 1059 – New York Appellate Digest

DATE OF LOSS MEANS THE DATE OF THE DENIAL OF THE CLAIM, NOT THE DATE OF THE EVENT TRIGGERING THE CLAIM, CAUSE OF ACTION NOT BARRED BY TWO YEAR STATUTE OF LIMITATIONS 4TH DEPT.

The Fourth Department, reversing Supreme Court, overruling Fourth Department precedent, determined causes of action stemming from a 2009 home burglary should not have been dismissed as barred by the two year statute of limitation. The term “date of loss” in the policy was interpreted to mean the date of the claim denial, not the date of the burglary:

Plaintiff commenced this action more than two years after the 2009 theft. Interpreting the phrase “date of loss” as the date on which the theft occurred, defendant contends that the action is time-barred under the terms of the policy. Plaintiff, on the other hand, interprets the phrase “date of loss” as the date on which the claim was denied and, as a result, contends that the action was timely commenced. We agree with plaintiff. Despite cases holding that “date of loss” means the date of the underlying catastrophe, including cases from this Department (see Baluk v New York Cent. Mut. Fire Ins. Co., 114 AD3d 1151; Klawiter v CGU/OneBeacon Ins. Group, 27 AD3d 1155), the Court of Appeals has found a distinction between the generic phrase “date of loss,” and the term of art “inception of loss” (see Medical Facilities v Pryke, 95 AD2d 692, 693, affd 62 NY2d 716; Proc v Home Ins. Co., 17 NY2d 239, 243-244, rearg denied 18 NY2d 751; Steen v Niagara Fire Ins. Co., 89 NY 315, 322-325). As the Second Circuit noted in Fabozzi v Lexington Ins. Co. (601 F3d 88, 91), those cases have not been overruled or disavowed in any way.

Indeed, as the 1st Department recognized in Medical Facilities, “nothing in [Proc] suggests an intention to alter [the] general rule” … , which is “that an action for breach of contract commences running at the time the breach takes place” … . Thus, only the very specific “inception of loss” or other similarly “distinct language” permits using the catastrophe date as the limitations date … . Here, the policy did not contain the specific “inception of loss” or other similarly distinct language, and we thus disavow our decisions in Baluk and Klawiter to the extent that they hold otherwise.

Inasmuch as ” [a]mbiguities in an insurance policy are to be construed against the insurer’ ” … , we conclude that the two-year limitations period contained in the policy did not begin to run until “the loss [became] due and payable” … . Lobello v New York Cent. Mut. Fire Ins. Co., 2017 NY Slip Op 05543, 4th Dept 7-7-17

INSURANCE LAW (DATE OF LOSS MEANS THE DATE OF THE DENIAL OF THE CLAIM, NOT THE DATE OF THE EVENT TRIGGERING THE CLAIM, CAUSE OF ACTION NOT BARRED BY TWO YEAR STATUTE OF LIMITATIONS 4TH DEPT)/CIVIL PROCEDURE (INSURANCE LAW, STATUTE OF LIMITATIONS, DATE OF LOSS MEANS THE DATE OF THE DENIAL OF THE CLAIM, NOT THE DATE OF THE EVENT TRIGGERING THE CLAIM, CAUSE OF ACTION NOT BARRED BY TWO YEAR STATUTE OF LIMITATIONS 4TH DEPT)/STATUTE OF LIMITATIONS (INSURANCE LAW, DATE OF LOSS MEANS THE DATE OF THE DENIAL OF THE CLAIM, NOT THE DATE OF THE EVENT TRIGGERING THE CLAIM, CAUSE OF ACTION NOT BARRED BY TWO YEAR STATUTE OF LIMITATIONS 4TH DEPT)

July 07, 2017

/ Family Law

EVIDENCE MOTHER HAD BEEN ARRESTED FOR A DRUG OFFENSE WAS ENOUGH TO WARRANT A HEARING ON FATHER’S PETITION FOR A CUSTODY MODIFICATION 4TH DEPT.

The Fourth Department determined father’s petition to modify custody should not have been denied without a hearing. The evidence that mother had been arrested for a drug offense, in addition to allegations of corporal punishment by mother’s boyfriend, were enough to warrant a hearing:

We … agree with the father that he made a sufficient evidentiary showing of a change in circumstances to require a hearing with respect to certain remaining allegations in the amended petition. It was undisputed that the mother was facing prosecution for criminal possession of a controlled substance in Georgia. Although the mother submitted a negative drug test in support of her motion, the drug test was performed on a hair follicle sample that she submitted well after her arrest, and the assertions by the mother’s attorney regarding how far back such a test could detect drug use raises an issue to be resolved at an evidentiary hearing, not on a motion to dismiss. Considering the mother’s history of drug and alcohol addiction, as acknowledged by the parties in the parenting agreement, we conclude that the allegation that the mother was arrested and being prosecuted for criminal possession of a controlled substance is sufficient to warrant a hearing … , inasmuch as such conduct, including the mother’s possible unlawful use of a controlled substance, “is plainly relevant to her fitness as a parent” … . Matter of Farner v Farner, 2017 NY Slip Op 05545, 4th Dept 7-7-17

FAMILY LAW (CUSTODY, EVIDENCE MOTHER HAD BEEN ARRESTED FOR A DRUG OFFENSE WAS ENOUGH TO WARRANT A HEARING ON FATHER’S PETITION FOR A CUSTODY MODIFICATION 4TH DEPT)/CUSTODY (FAMILY LAW, EVIDENCE MOTHER HAD BEEN ARRESTED FOR A DRUG OFFENSE WAS ENOUGH TO WARRANT A HEARING ON FATHER’S PETITION FOR A CUSTODY MODIFICATION 4TH DEPT)

July 07, 2017

/ Civil Procedure, Environmental Law

DEC CONTRACTORS HAD THE RIGHT TO ENTER PROPERTY TO TEST FOR GASOLINE CONTAMINATION WITHOUT SIGNING THE PROPERTY OWNER’S ACCESS AGREEMENT, BECAUSE ONLY A CHANGE IN FORM WAS REQUIRED, THE DEC’S ACTION WAS CONVERTED TO A DECLARATORY JUDGMENT ACTION 4TH DEPT.

The Fourth Department, reversing Supreme Court, determined the Department of Environmental Conservation (DEC) and its contractors had the right to enter respondent’s property to test for gasoline contamination without signing an access agreement with the property owner. The property owner had refused entry to DEC contractors because its proposed access agreement was rejected by the DEC. The Fourth Department further determined a declaratory judgment action was the appropriate vehicle for the relief requested by the DEC and converted the action accordingly:

We … agree with the DEC that the Oil Spill Act authorizes it and its contractors or agents to enter suspected spill sites. Navigation Law § 178 provides, in pertinent part, that “[t]he department is hereby authorized to enter and inspect any property or premises for the purpose of inspecting facilities and investigating either actual or suspected sources of discharges or violation of this article or any rule or regulation promulgated pursuant to this article. * * *

Where an unregulated discharge takes place, … the “person” responsible “shall immediately undertake to contain such discharge” … . As this does not always occur, “the [DEC] may undertake the removal of such discharge and may retain agents and contractors who shall operate under the direction of [the DEC] for such purposes” … , and in reading the Act’s sections together to best effectuate the Legislature’s intended objectives … , we conclude that the DEC’s contractors who “operate under the direction of [the DEC]” to investigate and remediate suspected and actual discharges of petroleum are authorized by statute, like the DEC, to enter the subject property for such purposes without acceding to landowner access agreements, but remaining subject only to restrictions imposed by law. Matter of State of New York (Essex Prop. Mgt., LLC), 2017 NY Slip Op 05525, 4th Dept 7-7-17

ENVIRONMENTAL LAW (NAVIGATION LAW, GASOLINE CONTAMINATION, DEC CONTRACTORS HAD THE RIGHT TO ENTER PROPERTY TO TEST FOR GASOLINE CONTAMINATION WITHOUT SIGNING THE PROPERTY OWNER’S ACCESS AGREEMENT, BECAUSE ONLY A CHANGE IN FORM WAS REQUIRED, THE DEC’S ACTION WAS CONVERTED TO A DECLARATORY JUDGMENT ACTION 4TH DEPT)/CIVIL PROCEDURE (BECAUSE ONLY A CHANGE IN FORM WAS REQUIRED, THE DEC’S ACTION WAS CONVERTED TO A DECLARATORY JUDGMENT ACTION 4TH DEPT)/NAVIGATION LAW (GASOLINE CONTAMINATION, DEC CONTRACTORS HAD THE RIGHT TO ENTER PROPERTY TO TEST FOR GASOLINE CONTAMINATION WITHOUT SIGNING THE PROPERTY OWNER’S ACCESS AGREEMENT, BECAUSE ONLY A CHANGE IN FORM WAS REQUIRED, THE DEC’S ACTION WAS CONVERTED TO A DECLARATORY JUDGMENT ACTION 4TH DEPT)/OIL SPILL LAW (NAVIGATION LAW, GASOLINE CONTAMINATION, DEC CONTRACTORS HAD THE RIGHT TO ENTER PROPERTY TO TEST FOR GASOLINE CONTAMINATION WITHOUT SIGNING THE PROPERTY OWNER’S ACCESS AGREEMENT, BECAUSE ONLY A CHANGE IN FORM WAS REQUIRED, THE DEC’S ACTION WAS CONVERTED TO A DECLARATORY JUDGMENT ACTION 4TH DEPT)/GASOLINE CONTAMINATION (NAVIGATION LAW, GASOLINE CONTAMINATION, DEC CONTRACTORS HAD THE RIGHT TO ENTER PROPERTY TO TEST FOR GASOLINE CONTAMINATION WITHOUT SIGNING THE PROPERTY OWNER’S ACCESS AGREEMENT, BECAUSE ONLY A CHANGE IN FORM WAS REQUIRED, THE DEC’S ACTION WAS CONVERTED TO A DECLARATORY JUDGMENT ACTION 4TH DEPT)

July 07, 2017

/ Environmental Law, Municipal Law

LOCAL LAW WHICH CONFLICTED WITH THE STATE ENVIRONMENTAL QUALITY REVIEW ACT WAS PROPERLY DECLARED INVALID 4TH DEPT.

The Fourth Department determined Supreme Court properly declared invalid a local law which conflicted with the State Environmental Quality Review Act (SEQRA). The local law allowed the classification of a restaurant with a drive-through window as a Type I project. However, the Fourth Department held the intent of SEQRA was to classify such a restaurant as a Type II project:

We … conclude that the court properly declared that Local Law No. 9-2014 is invalid inasmuch as it is inconsistent with 6 NYCRR 617.5 (c) (7) to the extent that it classifies “[d]rive-through stations or windows” such as “restaurants” as Type I actions under SEQRA. A local law that is “inconsistent with SEQRA” must be invalidated … . Here, although 6 NYCRR 617.5 (c) (7) does not explicitly include the construction of a restaurant with a drive-through window as a Type II action, we conclude that the Department of Environmental Conservation contemplated restaurants with drive-through windows as Type II actions when it promulgated that regulation … . We similarly conclude that the court properly annulled defendant’s classification of the project as a Type I action on the ground that the classification was affected by an error of law inasmuch as Local Law No. 9-2014 is inconsistent with SEQRA … . Nonetheless, the court should have declined to accept, without a revised review by defendant, plaintiff’s contention that the project should be classified as a Type II action … . We therefore modify the judgment by annulling the determination that the project is a Type II action, and we remit the matter to defendant for a new determination. Miranda Holdings, Inc. v Town Bd. of Town of Orchard Park, 2017 NY Slip Op 05554, 4th Dept 7-7-17

ENVIRONMENTAL LAW (LOCAL LAW WHICH CONFLICTED WITH THE STATE ENVIRONMENTAL QUALITY REVIEW ACT WAS PROPERLY DECLARED INVALID 4TH DEPT)/STATE ENVIRONMENTAL QUALITY REVIEW ACT (SEQRA) (LOCAL LAW WHICH CONFLICTED WITH THE STATE ENVIRONMENTAL QUALITY REVIEW ACT WAS PROPERLY DECLARED INVALID 4TH DEPT)/MUNICIPAL LAW (ENVIRONMENTAL LAW, LOCAL LAW WHICH CONFLICTED WITH THE STATE ENVIRONMENTAL QUALITY REVIEW ACT WAS PROPERLY DECLARED INVALID 4TH DEPT)/SEQRA (LOCAL LAW WHICH CONFLICTED WITH THE STATE ENVIRONMENTAL QUALITY REVIEW ACT WAS PROPERLY DECLARED INVALID 4TH DEPT)

July 07, 2017

/ Criminal Law, Evidence

TROOPER DID NOT HAVE A REASONABLE SUSPICION OF CRIMINAL ACTIVITY WHEN DEFENDANT WAS QUESTIONED ABOUT THE CONTENTS OF BAGS IN HIS VEHICLE, DEFENDANT’S NERVOUSNESS AND INCONSISTENT ANSWERS DID NOT JUSTIFY THE QUESTIONING, MOTION TO SUPPRESS SHOULD HAVE BEEN GRANTED 4TH DEPT.

The Fourth Department, reversing defendant’s conviction and dismissing the indictment, determined the trooper who stopped defendant’s vehicle did not have a founded suspicion of criminal activity at the time the trooper asked questions which amounted to a De Bour level two inquiry:

Defendant appeals from a judgment convicting him upon his plea of guilty of possessing or transporting 30,000 or more unstamped cigarettes … . When a State Trooper pulled over defendant for speeding on Interstate 81, he noticed “several large nylon bags” with “square edged contours” filling the area behind the driver’s seat. The Trooper initially asked defendant what was inside the bags, i.e., whether there was luggage in the bags, and defendant gave a series of increasingly implausible answers, including “clothing,” “presents,” “riding toys,” and “bicycles.” Defendant asked if he could leave, but the Trooper instead requested that he exit the vehicle while the Trooper spoke to two passengers. When the Trooper returned to speak to defendant, but before he advised defendant of his Miranda rights, defendant admitted that the bags contained nearly 300 cartons of untaxed cigarettes purchased from an Indian reservation.

We conclude that the court erred in refusing to suppress the physical evidence and statements at issue. Contrary to defendant’s contention, however, our rationale is not grounded in custody and/or Miranda issues. “In light of the heightened dangers faced by investigating police officers during traffic stops, a police officer may, as a precautionary measure and without particularized suspicion, direct the occupants of a lawfully stopped vehicle to step out of the car” … . Here, defendant was not in custody during his temporary roadside detention, and it was permissible for the Trooper to engage in a reasonable interrogation of defendant without first advising him of his Miranda rights … .

We conclude, however, that the Trooper’s initial inquiry concerning the contents of the bags constituted a level two common-law inquiry, which required a founded suspicion of criminality that was not present at the time … . Indeed, we note that nervousness, fidgeting, and illogical or contradictory responses to level one inquiries do not permit an officer to escalate an encounter to a level two De Bour confrontation … . Here, the facts are even more strongly in favor of defendant inasmuch as defendant’s evasive and inconsistent answers were themselves induced by a level two inquiry from the Trooper. Because a founded suspicion of criminality did not arise until after the Trooper asked defendant what was inside the bags, the court erred in refusing to suppress the evidence. People v Gates, 2017 NY Slip Op 05549, 4th Dept 7-7-17

CRIMINAL LAW (STREET STOP, SUPPRESSION, TROOPER DID NOT HAVE A REASONABLE SUSPICION OF CRIMINAL ACTIVITY WHEN DEFENDANT WAS QUESTIONED ABOUT THE CONTENTS OF BAGS IN HIS VEHICLE, DEFENDANT’S NERVOUSNESS AND INCONSISTENT ANSWERS DID NOT JUSTIFY THE QUESTIONING, MOTION TO SUPPRESS SHOULD HAVE BEEN GRANTED 4TH DEPT)/STREET STOPS (SUPPRESSION, TROOPER DID NOT HAVE A REASONABLE SUSPICION OF CRIMINAL ACTIVITY WHEN DEFENDANT WAS QUESTIONED ABOUT THE CONTENTS OF BAGS IN HIS VEHICLE, DEFENDANT’S NERVOUSNESS AND INCONSISTENT ANSWERS DID NOT JUSTIFY THE QUESTIONING, MOTION TO SUPPRESS SHOULD HAVE BEEN GRANTED 4TH DEPT)/SUPPRESS, MOTION TO (STREET STOP, TROOPER DID NOT HAVE A REASONABLE SUSPICION OF CRIMINAL ACTIVITY WHEN DEFENDANT WAS QUESTIONED ABOUT THE CONTENTS OF BAGS IN HIS VEHICLE, DEFENDANT’S NERVOUSNESS AND INCONSISTENT ANSWERS DID NOT JUSTIFY THE QUESTIONING, MOTION TO SUPPRESS SHOULD HAVE BEEN GRANTED 4TH DEPT)/TRAFFIC STOPS (SUPPRESSION, TROOPER DID NOT HAVE A REASONABLE SUSPICION OF CRIMINAL ACTIVITY WHEN DEFENDANT WAS QUESTIONED ABOUT THE CONTENTS OF BAGS IN HIS VEHICLE, DEFENDANT’S NERVOUSNESS AND INCONSISTENT ANSWERS DID NOT JUSTIFY THE QUESTIONING, MOTION TO SUPPRESS SHOULD HAVE BEEN GRANTED 4TH DEPT)/DE BOUR (LEVEL TWO INQUIRY, TROOPER DID NOT HAVE A REASONABLE SUSPICION OF CRIMINAL ACTIVITY WHEN DEFENDANT WAS QUESTIONED ABOUT THE CONTENTS OF BAGS IN HIS VEHICLE, DEFENDANT’S NERVOUSNESS AND INCONSISTENT ANSWERS DID NOT JUSTIFY THE QUESTIONING, MOTION TO SUPPRESS SHOULD HAVE BEEN GRANTED 4TH DEPT)

July 07, 2017

/ Criminal Law, Evidence

THE FAILURE TO PLACE THE PHOTOGRAPH WHICH WAS THE BASIS FOR THE POLICE OFFICER’S IDENTIFICATION OF THE DEFENDANT IN EVIDENCE RENDERED THE OFFICER’S IDENTIFICATION TESTIMONY UNRELIABLE, NEW TRIAL ORDERED 4TH DEPT.

The Fourth Department, over a dissent, determined the identification testimony by a police officer was unreliable because the photograph upon which the officer’s identification was based was not put in evidence at the hearing. A new trial was ordered. The dissent noted that this is the first case holding an identification unreliable where an unduly suggestive police identification procedure was not involved:

At the hearing, the People attempted to introduce in evidence a photograph that was allegedly used by the undercover officer. The court refused to admit the photograph in evidence, however, on the grounds that the People failed to produce it during discovery and that, in their discovery responses, the People expressly denied the existence of any photographs in the People’s possession. Thus, the photograph, i.e., the linchpin to the undercover officer’s identification of defendant, was not before the court, and we conclude that its absence created a presumption of unreliability in the pretrial identification of defendant by the undercover officer … .

We further note that the People failed to adduce any evidence detailing the procedures used to obtain the photograph at issue … . The undercover officer testified that he was given the name “Kevin Reeves” by a confidential informant. The confidential informant did not testify. Significantly, the officer could not recall if the confidential informant gave him any identifying factors about “Kevin Reeves” such as height, description, or skin color. The officer testified that he entered the name “Kevin Reeves” into a law enforcement computer database and that his search resulted in a photograph that he printed and viewed after the drug transaction. The officer did not testify, however, as to which search criteria he used, how many photos he viewed in response to his search criteria, and how he may have distinguished among more than one photograph generated by his search. As a result of the above shortcomings in the People’s evidence, we conclude that the People failed to rebut the presumption of unreliability of the pretrial identification created by the absence of the photograph … .

FROM THE DISSENT:

I do not believe that there is any legal basis to suppress identification testimony of a defendant based on the alleged unreliability of the witness’s identification unless the identification is the product of unduly suggestive police procedures … . Indeed, a suppression court is not required to make “a threshold inquiry into the reliability of . . . identification testimony” … , and “the reliability of untainted in-court identification testimony presents an issue of fact for jury resolution’ “… .

This is the first reported case in New York where identification testimony has been suppressed in the absence of a finding that the identification was influenced by unduly suggestive police procedures. People v Reeves, 2017 NY Slip Op 05526, 4th Dept 7-7-17

CRIMINAL LAW (IDENTIFICATION, THE FAILURE TO PLACE THE PHOTOGRAPH WHICH WAS THE BASIS FOR THE POLICE OFFICER’S IDENTIFICATION OF THE DEFENDANT IN EVIDENCE RENDERED THE OFFICER’S IDENTIFICATION TESTIMONY UNRELIABLE, NEW TRIAL ORDERED 4TH DEPT)/EVIDENCE (CRIMINAL LAW, IDENTIFICATION, THE FAILURE TO PLACE THE PHOTOGRAPH WHICH WAS THE BASIS FOR THE POLICE OFFICER’S IDENTIFICATION OF THE DEFENDANT IN EVIDENCE RENDERED THE OFFICER’S IDENTIFICATION TESTIMONY UNRELIABLE, NEW TRIAL ORDERED 4TH DEPT)/IDENTIFICATION (CRIMINAL LAW, THE FAILURE TO PLACE THE PHOTOGRAPH WHICH WAS THE BASIS FOR THE POLICE OFFICER’S IDENTIFICATION OF THE DEFENDANT IN EVIDENCE RENDERED THE OFFICER’S IDENTIFICATION TESTIMONY UNRELIABLE, NEW TRIAL ORDERED 4TH DEPT)/PHOTOGRAPHS (CRIMINAL LAW, IDENTIFICATION, THE FAILURE TO PLACE THE PHOTOGRAPH WHICH WAS THE BASIS FOR THE POLICE OFFICER’S IDENTIFICATION OF THE DEFENDANT IN EVIDENCE RENDERED THE OFFICER’S IDENTIFICATION TESTIMONY UNRELIABLE, NEW TRIAL ORDERED 4TH DEPT)

July 07, 2017

/ Appeals, Criminal Law

FAILURE TO FOLLOW PROCEDURE FOR SENTENCING A SECOND FELONY OFFENDER RENDERED THE SENTENCE ILLEGAL, SENTENCE CANNOT STAND DESPITE FAILURE TO RAISE THE ISSUE ON APPEAL 4TH DEPT.

Although the issue was not raised on appeal, the Fourth Department determined the failure to follow the procedure for sentencing a second felony offender required resentencing:

We address the illegality of “the sentence . . . despite defendant’s failure to raise the issue in the trial court or on appeal” … . The presentence report available to the court and uncontested by the parties at sentencing indicates that defendant had been convicted of a prior felony for which he may have been sentenced within the 10-year period preceding commission of the first count of CSCS in the third degree, as tolled by Penal Law § 70.06 (1) (b) (v) and excluding from that statutory period the time during which defendant was incarcerated on the prior felony … . Where, as here, “information available to the court or to the [P]eople prior to sentencing for a felony indicate[d] that . . . defendant may have previously been subjected to a predicate felony conviction” … , “the People were required to file a second felony offender statement in accordance with CPL 400.21 and, if appropriate, the court was then required to sentence defendant as a second felony offender” … The People nevertheless failed to file a second felony offender statement herein, and the court illegally sentenced defendant, a known predicate felon, as a first felony drug offender … . Moreover, as the People correctly concede, if defendant was properly sentenced as a first felony drug offender, the imposition of three years of postrelease supervision is illegal because the applicable period for such an offender upon conviction of a class B felony is “not less than one year and no more than two years” … . Inasmuch as we cannot allow an illegal sentence to stand, we modify the judgment by vacating the sentence imposed, and we remit the matter to County Court for the filing of a predicate felony offender statement and resentencing in accordance with the law. People v Mattice, 2017 NY Slip Op 05558, 4th Dept 7-7-17

CRIMINAL LAW (SENTENCING, SECOND FELONY OFFENDER, FAILURE TO FOLLOW PROCEDURE FOR SENTENCING A SECOND FELONY OFFENDER RENDERED THE SENTENCE ILLEGAL, SENTENCE CANNOT STAND DESPITE FAILURE TO RAISE THE ISSUE ON APPEAL 4TH DEPT)/APPEALS (SENTENCING, SECOND FELONY OFFENDER, FAILURE TO FOLLOW PROCEDURE FOR SENTENCING A SECOND FELONY OFFENDER RENDERED THE SENTENCE ILLEGAL, SENTENCE CANNOT STAND DESPITE FAILURE TO RAISE THE ISSUE ON APPEAL 4TH DEPT)/SENTENCING (SECOND FELONY OFFENDER, FAILURE TO FOLLOW PROCEDURE FOR SENTENCING A SECOND FELONY OFFENDER RENDERED THE SENTENCE ILLEGAL, SENTENCE CANNOT STAND DESPITE FAILURE TO RAISE THE ISSUE ON APPEAL 4TH DEPT)/SECOND FELONY OFFENDERS (FAILURE TO FOLLOW PROCEDURE FOR SENTENCING A SECOND FELONY OFFENDER RENDERED THE SENTENCE ILLEGAL, SENTENCE CANNOT STAND DESPITE FAILURE TO RAISE THE ISSUE ON APPEAL 4TH DEPT)

July 07, 2017

/ Criminal Law

A JURY’S FAILURE TO RENDER A VERDICT ON A COUNT OF AN INDICTMENT IS THE EQUIVALENT OF AN ACQUITTAL ON THAT COUNT 4TH DEPT.

The Fourth Department noted that the absence of a verdict on a count of an indictment is the equivalent of an acquittal on that count:

Defendant contends that the judgment must be modified by reversing those parts convicting him under counts 9 and 10 of the indictment because he was not indicted in count 9, which charged two codefendants with criminal possession of a weapon in the second degree, and the jury did not render a verdict on count 10. As the People correctly concede, defendant is correct. It is well settled that “[t]he New York State Constitution guarantees that [n]o person shall be held to answer for a[n] infamous crime . . . unless on indictment of a grand jury’ ” … , and defendant was not charged in count 9 of the indictment. Although defendant was charged with criminal possession of a weapon in the second degree in count 10 of the indictment, the jury did not render a verdict on that count. It is well settled that a jury’s failure to render a verdict upon every count upon which it was instructed to do so “constitutes an acquittal on every count on which no verdict was rendered”… . We therefore modify the judgment by reversing those parts convicting defendant under counts 9 and 10, and by dismissing count 10 of the indictment with respect to defendant. People v Samuel, 2017 NY Slip Op 05542, 4th Dept 7-7-17

CRIMINAL LAW (A JURY’S FAILURE TO RENDER A VERDICT ON A COUNT OF AN INDICTMENT IS THE EQUIVALENT OF AN ACQUITTAL ON THAT COUNT 4TH DEPT)/VERDICTS (CRIMINAL LAW, A JURY’S FAILURE TO RENDER A VERDICT ON A COUNT OF AN INDICTMENT IS THE EQUIVALENT OF AN ACQUITTAL ON THAT COUNT 4TH DEPT)

July 07, 2017

/ Limited Liability Company Law

COMPLAINT STATED A CAUSE OF ACTION AGAINST THE LEGAL OWNER OF A LIMITED LIABILITY COMPANY UNDER THE ALTER EGO DOCTRINE BUT NOT AGAINST AN EQUITABLE OWNER OF THE COMPANY 4TH DEPT.

The Fourth Department, reversing Supreme Court, over a concurrence, determined plaintiff had stated a cause of action against McDonald, the sole owner, officer and member of a limited liability company (Hyperion). The complaint alleged McDonald had rendered the LLC judgment proof such that it could not satisfy a debt owed to plaintiff. The court further found that the allegations against another party, who was alleged to be an “equitable owner” of the LLC, were not sufficient. Implicit in that ruling was the principle that a non-owner could be liable under a “piercing the corporate veil” or “alter ego” theory. The concurrence noted the issue whether the “piercing the corporate veil” or “alter ego” theory could apply to an “equitable” as opposed to “legal” owner of a corporate entity has not been determined in New York:

Plaintiff sufficiently alleges in the amended complaint that McDonald, “through [his] domination of [Hyperion], abused the privilege of doing business in the corporate form to perpetrate a wrong or injustice against [her]” … Plaintiff specifically alleged that McDonald took actions calculated to make Hyperion judgment-proof by undercapitalizing the LLC … , and dissolving and thereafter diverting the assets of Hyperion to a new entity … , without reserving funds to satisfy the judgment debt … . We therefore conclude that, at this stage of the litigation, plaintiff sufficiently alleged that McDonald “engaged in acts amounting to an abuse or perversion of the LLC form to perpetrate a wrong or injustice against [her]” to survive his motion to dismiss the amended complaint … .

FROM THE CONCURRENCE:

While the principle that a nonshareholder may be liable as an equitable owner has been used by other courts in cases involving piercing the corporate veil … , the Court of Appeals has not expressly decided the issue… . The adoption of that concept by the Court of Appeals would involve wide-ranging policy considerations inasmuch as it would expand the pool of potential defendants subject to an alter ego theory to include non-owners (such as affiliated business entities, managers and employees), and could potentially reduce the protections afforded when forming a business entity. That concern may be even more significant to a limited liability company that, if the members so provide in their articles of organization, may be under the control of a manager or managers, rather than under the control of the members (see Limited Liability Company Law § 408 [a]). Grigsby v Francabandiero, 2017 NY Slip Op 05539, 4th Dept 7-7-17

CORPORATION LAW (LIMITED LIABILITY COMPANY, ALTER EGO, COMPLAINT STATED A CAUSE OF ACTION AGAINST THE LEGAL OWNER OF A LIMITED LIABILITY COMPANY UNDER THE ALTER EGO DOCTRINE BUT NOT AGAINST AN EQUITABLE OWNER OF THE COMPANY 4TH DEPT)/LIMITED LIABILITY COMPANY (ALTER EGO, COMPLAINT STATED A CAUSE OF ACTION AGAINST THE LEGAL OWNER OF A LIMITED LIABILITY COMPANY UNDER THE ALTER EGO DOCTRINE BUT NOT AGAINST AN EQUITABLE OWNER OF THE COMPANY 4TH DEPT)/PIERCING THE CORPORATE VEIL (LIMITED LIABILITY COMPANY, COMPLAINT STATED A CAUSE OF ACTION AGAINST THE LEGAL OWNER OF A LIMITED LIABILITY COMPANY UNDER THE ALTER EGO DOCTRINE BUT NOT AGAINST AN EQUITABLE OWNER OF THE COMPANY 4TH DEPT)/ALTER EGO (LIMITED LIABILITY COMPANY, COMPLAINT STATED A CAUSE OF ACTION AGAINST THE LEGAL OWNER OF A LIMITED LIABILITY COMPANY UNDER THE ALTER EGO DOCTRINE BUT NOT AGAINST AN EQUITABLE OWNER OF THE COMPANY 4TH DEPT)

July 07, 2017

/ Appeals, Civil Procedure

ACTION SEEKING INJUNCTION WAS NOT STARTED WITH A SUMMONS AND COMPLAINT, COURTS DID NOT HAVE JURISDICTION OVER THE MATTER, THE PAPERS WERE NOT APPEALABLE 4TH DEPT.

The Fourth Department determined that the town’s attempt obtain an injunction requiring respondents to tear down structures which violated the zoning code was invalid. The action was brought by an order to show cause, but no summons or complaint had been filed. Therefore the courts did not have jurisdiction over the matter:

“[T]he valid commencement of an action is a condition precedent to [Supreme Court’s] acquiring the jurisdiction even to entertain an application for a[n] . . . injunction”… . Here, however, there is no action supporting the application for an injunction. Indeed, the order to show cause and supporting papers themselves constitute the only request for an injunction. While ” courts are empowered and indeed directed to convert a civil judicial proceeding not brought in the proper form into one which would be in proper form, rather than to grant a dismissal’ “… , more than improper form is involved here … . Converting the order to show cause and supporting papers into a summons and complaint in these circumstances would effectively permit the Town to seek an injunction by motion, a result that is at odds with the well-established principle that “[t]he pendency of an action is an indispensable prerequisite to the granting of a[n] . . . injunction” … . We thus conclude that the court lacked jurisdiction to entertain the Town’s request … . Without an underlying action the order putatively on appeal does not constitute an appealable paper… . The appeal must therefore be dismissed. Matter of Town of Cicero v Lakeshore Estates, LLC, 2017 NY Slip Op 05524, 4th Dept 7-7-17

CIVIL PROCEDURE (ACTION SEEKING INJUNCTION WAS NOT STARTED WITH A SUMMONS AND COMPLAINT, COURTS DID NOT HAVE JURISDICTION OVER THE MATTER, THE PAPERS WERE NOT APPEALABLE 4TH DEPT)/APPEALS (ACTION SEEKING INJUNCTION WAS NOT STARTED WITH A SUMMONS AND COMPLAINT, COURTS DID NOT HAVE JURISDICTION OVER THE MATTER, THE PAPERS WERE NOT APPEALABLE 4TH DEPT)/INJUNCTIONS (ACTION SEEKING INJUNCTION WAS NOT STARTED WITH A SUMMONS AND COMPLAINT, COURTS DID NOT HAVE JURISDICTION OVER THE MATTER, THE PAPERS WERE NOT APPEALABLE 4TH DEPT)/JURISDICTION (SUMMONS AND COMPLAINT, ACTION SEEKING INJUNCTION WAS NOT STARTED WITH A SUMMONS AND COMPLAINT, COURTS DID NOT HAVE JURISDICTION OVER THE MATTER, THE PAPERS WERE NOT APPEALABLE 4TH DEPT)

July 07, 2017

Search Results

DATE OF LOSS MEANS THE DATE OF THE DENIAL OF THE CLAIM, NOT THE DATE OF THE EVENT TRIGGERING THE CLAIM, CAUSE OF ACTION NOT BARRED BY TWO YEAR STATUTE OF LIMITATIONS 4TH DEPT.

EVIDENCE MOTHER HAD BEEN ARRESTED FOR A DRUG OFFENSE WAS ENOUGH TO WARRANT A HEARING ON FATHER’S PETITION FOR A CUSTODY MODIFICATION 4TH DEPT.

DEC CONTRACTORS HAD THE RIGHT TO ENTER PROPERTY TO TEST FOR GASOLINE CONTAMINATION WITHOUT SIGNING THE PROPERTY OWNER’S ACCESS AGREEMENT, BECAUSE ONLY A CHANGE IN FORM WAS REQUIRED, THE DEC’S ACTION WAS CONVERTED TO A DECLARATORY JUDGMENT ACTION 4TH DEPT.

LOCAL LAW WHICH CONFLICTED WITH THE STATE ENVIRONMENTAL QUALITY REVIEW ACT WAS PROPERLY DECLARED INVALID 4TH DEPT.

TROOPER DID NOT HAVE A REASONABLE SUSPICION OF CRIMINAL ACTIVITY WHEN DEFENDANT WAS QUESTIONED ABOUT THE CONTENTS OF BAGS IN HIS VEHICLE, DEFENDANT’S NERVOUSNESS AND INCONSISTENT ANSWERS DID NOT JUSTIFY THE QUESTIONING, MOTION TO SUPPRESS SHOULD HAVE BEEN GRANTED 4TH DEPT.

THE FAILURE TO PLACE THE PHOTOGRAPH WHICH WAS THE BASIS FOR THE POLICE OFFICER’S IDENTIFICATION OF THE DEFENDANT IN EVIDENCE RENDERED THE OFFICER’S IDENTIFICATION TESTIMONY UNRELIABLE, NEW TRIAL ORDERED 4TH DEPT.

FAILURE TO FOLLOW PROCEDURE FOR SENTENCING A SECOND FELONY OFFENDER RENDERED THE SENTENCE ILLEGAL, SENTENCE CANNOT STAND DESPITE FAILURE TO RAISE THE ISSUE ON APPEAL 4TH DEPT.

A JURY’S FAILURE TO RENDER A VERDICT ON A COUNT OF AN INDICTMENT IS THE EQUIVALENT OF AN ACQUITTAL ON THAT COUNT 4TH DEPT.

COMPLAINT STATED A CAUSE OF ACTION AGAINST THE LEGAL OWNER OF A LIMITED LIABILITY COMPANY UNDER THE ALTER EGO DOCTRINE BUT NOT AGAINST AN EQUITABLE OWNER OF THE COMPANY 4TH DEPT.

ACTION SEEKING INJUNCTION WAS NOT STARTED WITH A SUMMONS AND COMPLAINT, COURTS DID NOT HAVE JURISDICTION OVER THE MATTER, THE PAPERS WERE NOT APPEALABLE 4TH DEPT.

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