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Loan Secured by Shares in a Cooperative Apartment Was Not a “Home Loan” Subject to the Pre-Foreclosure Settlement Conference Required by CPLR 3408

The Second Department determined defendant was not entitled to a pre-foreclosure settlement conference under CPLR 3408. The underlying loan was secured by shares in the cooperative apartment where defendant resided. Such a loan was not a “home loan” within the meaning of Real Property Actions and Proceedings Law (RPAPL) 1304, and therefore was not subject to the mandatory settlement conference under the CPLR:

CPLR 3408 requires, in relevant part, that a court hold a mandatory settlement conference in “any residential foreclosure action involving a home loan as such term is defined in section thirteen hundred four of the real property actions and proceeding law” (CPLR 3408[a]). RPAPL 1304 does not include, in its definition of “home loan,” a loan secured by shares of stock and a proprietary lease from a corporation formed for the purpose of cooperative ownership in real estate (RPAPL 1304[5][a][iii]; cf. Banking Law §§ 6-l[1][e][iv]; 6-m[1][d][iv]). Accordingly, because the subject loan is not a home loan within the meaning of RPAPL 1304, the plaintiff is not entitled to a mandatory settlement conference pursuant to CPLR 3408. DaCosta-Harris v Aurora Bank, FSB, 2015 NY Slip Op 06879, 2nd Dept 9-23-15

 

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Defense Counsel’s Conduct Did Not Warrant Setting Aside the Verdict

The Second Department determined Supreme Court abused its discretion when it set aside the verdict in a personal injury trial based upon the conduct of the defense attorney:

The plaintiffs moved to set aside the verdict pursuant to CPLR 4404(a): (1) in the interest of justice, contending that defense counsel’s improper and inflammatory remarks during summation deprived them of a fair trial; and (2) contending that the verdict as to damages was contrary to the weight of the evidence. The Supreme Court granted the motion on the first ground, and the defendants appeal.

Under CPLR 4404(a), a trial court has the discretion to order a new trial “in the interest of justice” (CPLR 4404[a]…). In considering whether to exercise its discretionary power to order a new trial based on errors at trial, the court “must decide whether substantial justice has been done, whether it is likely that the verdict has been affected . . . and must look to [its] own common sense, experience and sense of fairness rather than to precedents in arriving at a decision’ … . On appeal, however, this Court is invested with the power to decide whether the trial court providently exercised its discretion … .

Here, we conclude that the Supreme Court improvidently exercised its discretion in ordering a new trial. The plaintiffs’ claims regarding defense counsel’s conduct center on remarks made by defense counsel during her summation, although they also challenge her cross-examination of certain witnesses. Some of the challenged conduct was certainly improper, and we do not condone it … . Nonetheless, viewing defense counsel’s conduct in the context of the entire trial, we conclude that it was not pervasive or prejudicial, or so inflammatory as to deprive the plaintiffs of a fair trial … . Lariviere v New York City Tr. Auth., 2015 NY Slip Op 06894, 2nd Dept 9-23-15

 

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Forum Selection Clause in a “Release of Liability” Form Is Enforceable

The Second Department determined the forum selection clause in an “Equipment Rental Form and Release of Liability” signed by plaintiff prior to taking snowboarding lessons at defendant ski resort was enforceable. Plaintiff alleged injury caused by improper instruction and argued the form was an invalid contract of adhesion:

Contrary to the plaintiff’s contentions, the “Equipment Rental Form and Release of Liability” was not an unenforceable contract of adhesion, and enforcement of the forum selection clause contained therein does not contravene public policy … . Karlsberg v Hunter Mtn. Ski Bowl, Inc., 2015 NY Slip Op 06890, 2nd Dept 9-23-15

 

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Unlike a “State Human Rights Law” Cause of Action, a “New York City Human Rights Law” Cause of Action Is Supported If Racial Bias Played “Any Role” (As Opposed to a “Motivating and Substantial Role”) In the Discriminatory Action

The plaintiff alleged he was terminated from employment due to racial bias and sued under the Executive Law (New York State Human Rights Law) and under New York City Human Rights Law. Plaintiff acknowledged that he was sleeping on the job, a legitimate reason for termination. Plaintiff’s New York State Human Rights Law cause of action was dismissed because plaintiff could not show that racial bias played a “motivating or substantial role” in the termination. But, because the criteria for a cause of action under the New York City Human Rights Law are broader, the New York City Human Rights Law cause of action survived summary judgment. Under the New York City Human Rights Law, if termination was motivated “in part” by racial bias, even though there was a legitimate reason for termination, the termination is actionable:

The Court of Appeals has recognized that the New York City Human Rights Law must be construed “broadly in favor of discrimination plaintiffs, to the extent that such a construction is reasonably possible” … . Thus, the New York City Human Rights Law is to be more broadly interpreted than similarly worded federal or State antidiscrimination provisions … . The Appellate Division, First Department, has interpreted the New York City Human Rights Law as requiring that unlawful discrimination play ” no role'” in an employment decision … . Our Court has expressed general agreement with the First Department’s interpretation of the New York City Human Rights Law … . Thus, under the broadly worded and broadly interpreted New York City Human Rights Law, if the supervisor’s decision to report the plaintiff was motivated by racial or ethnic animus, even in part, the defendant may be held liable.

The evidence undisputedly established that the plaintiff’s employment was terminated by the defendant because the plaintiff was found to be asleep while on duty, in violation of its rules. Additionally, there was evidence that the defendant had a zero-tolerance policy with respect to violations of that rule. Further, it is also not disputed that the defendant’s no-tolerance policy regarding the termination of the employment of employees found sleeping while on duty is a legitimate policy. Nevertheless, the plaintiff presented evidence that his supervisor reported him to the defendant’s management in part out of racial animus, and did not report other, non-Indian employees who were found sleeping while on duty. Thus, the plaintiff raised a triable issue of fact as to whether his supervisor’s unlawful discrimination, which is to be imputed to the defendant, played a role in the termination of the plaintiff’s employment. Accordingly, the Supreme Court erred in granting that branch of the defendant’s motion which was for summary judgment dismissing the cause of action alleging a violation of the New York City Human Rights Law … . Singh v Covenant Aviation Sec., LLC, 2015 NY Slip Op 06911, 2nd Dept 9-23-15

 

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Rare Example of Sufficiently Pled Cause of Action for Prima Facie Tort—Elements of Tortious Interference with a Contract Outlined

The Second Department determined plaintiff had stated a cause of action for prima facie tort and tortious interference with a contract. The complaint alleged the defendant set up websites and organized public protests accusing plaintiff of child abuse and had communicated with plaintiff’s employer, causing plaintiff to be terminated without cause. The decision is noteworthy because it demonstrates the extreme nature of allegations deemed sufficient to support a prima facie tort cause of action. With respect to the tortious interference with contract cause of action, the court explained:

The elements of tortious interference with a contract are: “(1) the existence of a contract between plaintiff and a third party; (2) defendant’s knowledge of the contract; (3) defendant’s intentional inducement of the third party to breach or otherwise render performance impossible; and (4) damages to plaintiff” … . The amended complaint sufficiently sets forth a cause of action based on tortious interference with a contract, alleging, in pertinent part, that [defendant’s] intentional interference with the subject employment contract rendered performance impossible. Hersh v Cohen, 2015 NY Slip Op 06888, 2nd Dept 9-23-15

 

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Town Has Duty to Defend Former Town Clerk Accused of Sexual Harassment Within the Scope of Employment

The Second Department determined the Town Law required the town to pay for the defense of the former town clerk accused of sexual harassment within the scope of his employment:

The duty to defend is broader than the duty to indemnify …, and it is triggered if the civil complaint includes allegations that the employee was acting within the scope of his or her employment at the time of the alleged wrongdoing … . Here, the underlying federal complaint specifically alleges, among other things, that the petitioner committed sexual harassment while acting in the scope of his employment as the Town Clerk, the Town facilitated a hostile work environment, and the Town failed to prevent workplace harassment. Contrary to the Town’s contention, the Supreme Court correctly determined that the allegations in the federal complaint were sufficient to trigger the Town’s broad duty to defend the petitioner … . Matter of Bonilla v Town of Hempstead, 2015 NY Slip Op 06916, 2nd Dept 9-23-15

 

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Relation Back Doctrine Did Not Apply to Causes of Action in Amended Complaint—Amendment Should Not Have Been Allowed

The Second Department determined Supreme Court should not have allowed the amendment of a medical malpractice complaint to add causes of action for negligent hiring and supervision. The negligent hiring and supervision allegations were time barred and were different from the medical malpractice allegations such that the relation back doctrine did not apply:

Pursuant to CPLR 203(f), claims asserted in an amended complaint are “deemed to have been interposed at the time the claims in the original pleading were interposed, unless the original pleading does not give notice of the transactions, occurrences, or series of transactions or occurrences, to be proved pursuant to the amended pleading” (CPLR 203[f]). Thus, when the nature of a newly asserted cause of action is distinct from the causes of action asserted in the original complaint, and requires different factual allegations as to the underlying conduct than were contained in the original complaint, the new claims will not “relate back” in time to the interposition of the causes of action in the original complaint … . Here, the Supreme Court erred in determining that the allegations in the original complaint in support of the causes of action alleging medical malpractice and lack of informed consent gave [defendant] notice of the “transactions, occurrences, or series of transactions or occurrences, to be proved” with respect to the claims of negligent hiring and supervision … . The causes of action alleging medical malpractice and lack of informed consent are distinct not only as to the conduct alleged, but also as to the dates on which the conduct occurred and who engaged in it … . The mere reference to “negligence” in the original complaint did not give [defendant] notice of the transactions, occurrences, or series of transactions or occurrences, to be proved with respect to the proposed causes of action alleging negligent hiring and negligent supervision. Thus, those proposed causes of action could not be deemed to relate back to the interposition of the causes of action in the original complaint … . Calamari v Panos, 2015 NY Slip Op 06875, 2nd Dept 9-23-15

 

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Trustees Were Not Required by Town Law to Turn Over to the Town Board Trust Revenues Generated by Water Management in the Town of Southampton

In a detailed decision which traces the history of a trust and statutes governing town finances in the Town of Southampton from pre-colonial times to the present, the Second Department determined that the “Trustees of the Freeholders and Commonality of the Town of Southampton” (Trustees) were not obligated by Town Law to turn over trust revenues from water management to the Town Board:

For nearly 400 years, the Trustees of the Freeholders and Commonalty of the Town of Southampton (hereinafter the Trustees or the Trust) have had the right, derived from royal land grants and patents, to control and manage the waters of the town. In the present day, the Trustees raise revenue from issuing licenses for activities including commercial fishing, charging permit fees for seasonal boat docking, dock and bulkhead construction, and dredging, and selling sand excavated from Mecox Bay. The Trustees deposit their revenues into several bank accounts, which, at the time this action was commenced, had an aggregate balance of close to $1 million. On this appeal, we are called upon to determine whether Town Law § 64(1) requires the Trustees to turn over control of their revenues to the Town Board of the Town of Southampton (hereinafter the Town Board) and whether the expenditure of such revenues must therefore comply with the same statutes which govern town finances and expenditures. We conclude that Town Law § 64(1) does not require the Trustees to turn over control of their revenues to the Town Board, and that the statutes governing town finances and expenditures relied upon by the plaintiffs are inapplicable to the Trust. Gessin v Throne-Holst, 2015 NY Slip Op 06885, 2nd Dept 9-23-15

 

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Under the Facts, the Prosecutor Was Not Obligated to Present Exculpatory Evidence to the Grand Jury—Defendant Did Not Exercise His Right to Testify Before the Grand Jury

The First Department determined defendant’s motion to set aside the verdict on the ground the prosecutor did not charge the grand jury on the justification defense was properly denied. The indictment alleged the defendant attacked the victim, Valdez, with a machete. At trial, the defendant testified that Valdez attacked him with a baton and he used a knife in self-defense. It was revealed at trial that Valdez did in fact have a baton at the time of incident, that Valdez had not told the police about the baton, and that, months later, he told the prosecutor about the baton before the matter was presented to the grand jury. The defendant chose not to testify before the grand jury. No mention of the baton, or that the defendant made a statement claiming he acted in self-defense, was made in the grand jury proceedings and the grand jury was not instructed on the justification defense. The First Department held that the prosecutor’s failure, in the grand jury proceedings, to present evidence the victim had a baton, or that defendant stated he acted in self-defense, did not amount to misconduct justifying the dismissal of the indictment. The court emphasized the defendant’s failure to exercise his right to testify before the grand jury to present exculpatory evidence, and explained the nature of the prosecutor’s duty to present exculpatory evidence to the grand jury:

It is axiomatic that a prosecutor, in presenting evidence and potential charges to a grand jury, is ” charged with the duty not only to secure indictments but also to see that justice is done'” … . The role of the grand jury is not only to investigate criminal activity to see whether criminal charges are warranted but also to protect individuals from needless and unfounded charges … . For that reason, justification, as an exculpatory defense that if accepted eliminates any grounds for prosecution, should be presented to the grand jury when warranted by the evidence … . However, a prosecutor, in presenting a case to a grand jury, is “not obligated to search for evidence favorable to the defense or to present all evidence in [the People’s] possession that is favorable to the accused . . . In the ordinary case, it is the defendant who, through the exercise of his own right to testify . . . , brings exculpatory evidence to the attention of the Grand Jury” … . Thus, a prosecutor is not obligated to present to the grand jury a defendant’s exculpatory statement made to the police upon arrest … . Where, however, a prosecutor introduces a defendant’s inculpatory statement to the grand jury, he is obligated to introduce an exculpatory statement given during the course of the same interrogation which amplifies the inculpatory statement if it supports a justification defense … . * * *

Assuming arguendo that, as claimed by defendant and denied by the People, the ADA did know about the … baton at the time of the grand jury proceedings, dismissal of the indictment based on the failure to charge the grand jury on justification still would not be warranted. “[A] Grand Jury proceeding is not a mini trial . . . The prosecutor . . . need not disclose certain forms of exculpatory evidence . . . [Nor is] the prosecutor . . . obligated to present the evidence or make statements to the grand jurors in the manner most favorable to the defense” … . As previously noted, a prosecutor is “not obligated to search for evidence favorable to the defense or to present all evidence in [the People’s] possession that is favorable to the accused . . . In the ordinary case, it is the defendant who, through the exercise of his own right to testify . . . , brings exculpatory evidence to the attention of the Grand Jury”… . People v Morel, 2015 NY Slip Op 06865, 1st Dept 9-22-15

 

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Question of Fact Whether Former Tenants Entitled to Pass Apartment to Their Son Under the Rent Stabilization Law

The First Department determined there was a question of fact whether former tenants had stopped using their apartment as a primary residence, or whether they had permanently vacated the apartment. Under the terms of an agreement (Settlement Agreement), if the former tenants had permanently vacated the apartment, they were entitled to pass the apartment to their son, who had been living there most of his life. If, on the other hand, the former tenants merely stopped using the apartment as their primary residence, they could not pass the apartment to their son. The former tenants had moved to Uganda, where they had a home. They returned to New York every year to visit and used the apartment during the visits:

Although the parents no longer have rights to the apartment, there are still disputed issues of fact regarding whether at the time the parents moved to Uganda, they permanently vacated the apartment or continued to use the apartment as nonprimary residents. This issue and disputed facts directly affect the son’s right (if any) to a successor tenancy. If the parents permanently vacated, then the son would have rights as a successor. If, however, the parents continued to use the apartment as non-primary residents, the son’s claim would fail This issue precludes the grant of summary judgment to either side on the issue of whether the son has successor rights.  Waterside Plaza Ground Lessee, LLC v Rwambuya, 2015 NY Slip Op 06867, 1st Dept 9-22-15

 

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