The Second Department determined the trial court quashing of an subpoena served upon a defense witness deprived defendant of his constitutional right to present a defense and required a new trial. People v Eastment, 2013 NY Slip Op 03687, 2nd Dept, 5-22-13
There was a collision involving a car self-insured by Hertz, the petitioner. The respondent driver of the Hertz car alleged she collided with another car which left the scene. Based on a description of the other vehicle and the last four digits of the license number. Hertz determined the owner, Morrison, and insurer, Travelers, of the other car. Morrison denied involvement in the accident and Travelers denied the respondent’s property damage claim on that basis. The respondent sought supplementary uninsured motorist arbitration with Hertz. Hertz then commenced a proceeding to temporarily stay arbitration pending a framed-issue hearing to determine if Morrison was involved in the collision. In determining Hertz petition should have been granted, the Second Department wrote:
“The party seeking a stay of arbitration has the burden of showing the existence of sufficient evidentiary facts to establish a preliminary issue which would justify the stay”…. Thereafter, the burden is on the party opposing the stay to rebut the prima facie showing…. Where a triable issue of fact is raised, the Supreme Court, not the arbitrator, must determine it in a framed-issue hearing, and the appropriate procedure under such circumstances is to temporarily stay arbitration pending a determination of the issue …. Here, the documents submitted by Hertz in support of the petition demonstrated the existence of sufficient evidentiary facts to establish a preliminary issue justifying a temporary stay. In opposition to the petition, Morrison denied any involvement in the accident. As the evidence submitted by the parties raised a triable issue of fact as to whether Morrison’s vehicle was involved in the subject accident, the Supreme Court should have conducted a framed-issue hearing on that issue before rendering a determination on the petition … . Matter of Hertz Corp v Holmes, 2013 NY Slip Op 03674, 2nd Dept, 5-22-13
TRAFFIC ACCIDENTS
The Second Department determined that plaintiff-wife’s stipulation that variable supplement fund (VSF) benefits were not marital property should be upheld, even though the law was unclear at the time of the stipulation and the Court of Appeals subsequently determined the benefits were marital property:
The Referee was correct in noting that, at the time of the parties’ stipulation of settlement, the law on the issue of whether VSF benefits were subject to equitable distribution was unclear. The law was later clarified when the Court of Appeals held that VSF benefits were marital property subject to equitable distribution …. However, the fact that the plaintiff did not have definitive guidance on the issue of whether VSF benefits were subject to equitable distribution is not a sufficient basis upon which she may avoid the effects of her otherwise knowing and voluntary waiver. Thus, it was error to permit the defendant to avoid the consequences of her waiver of any interest in the VSF. Lamassa v Lamassa, 2013 NY Slip Op 03639, 2nd Dept, 5-22-13
In finding the homeowner’s exemption of Labor Law 240(1) and 240 applied to work on a single-family house in which the business owners lived and from which the defendant business derived no income, the Second Department wrote:
Labor Law §§ 240(1) and 241, which impose certain nondelegable safety duties upon “contractors[,] owners and their agents,” specifically exempt “owners of one and two-family dwellings who contract for but do not direct or control the work.” Here, Green Chimneys [defendant] demonstrated its prima facie entitlement to judgment as a matter of law with respect to, inter alia, its claim that it was entitled to the homeowner’s exemption of Labor Law §§ 240(1) and 241 by establishing that the Founder’s House was a single-family dwelling used solely as a residence for Green Chimneys’ founder and his wife, the house served no commercial or business use for Green Chimneys, which received no income from the house, and Green Chimneys did not direct or control the work being performed…. Parise v Green Chimneys Children’s Servs, Inc, 2014 NY Slip Op 03649, 2nd Dept, 5-22-13
Plaintiff was struck by a small piece of sheetrock a worker dropped from the third floor. In affirming the dismissal of the Labor Law 240(1) cause of action, the Second Department wrote:
As the Court of Appeals has observed, not every injury caused by a falling object at a construction site is covered by the extraordinary protections of Labor Law § 240(1)…. Rather, in a “falling object” case under Labor Law § 240(1)…, a plaintiff must show that, at the time the object fell, it was “being hoisted or secured” … or “required securing for the purposes of the undertaking”…. The plaintiff also must show that the object fell “because of the absence or inadequacy of a safety device of the kind enumerated in the statute”…. The statute does not apply in situations in which a hoisting or securing device of the type enumerated in the statute would not be necessary or expected…. Moncayo v Curtis Partition Corp, 2013 NY Slip Op 03644, 2nd Dept, 5-22-13
In determining plaintiff’s use of a step ladder that was not unfolded did not warrant dismissal of the Labor Law 240(1) cause of action for a fall from the ladder, the First Department wrote:
Plaintiff established prima facie entitlement to summary judgment on his Labor Law § 240(1) claim as against defendants …by his testimony that: (1) the ladder was the only one available; (2) the ladder could not be properly opened into an A-frame stance due to excess debris in his narrowly confined work space; (3) he asked his foreman for another ladder, to no avail; (4) the ladder was unusual in that the step treads contained spikes which unexpectedly caught hold of his shoe as he was descending the improperly leaning ladder; (5) he was caused to fall backwards, from a height of approximately six feet; and (6) his right shoulder was injured when it struck the wooden work-zone barrier as he fell. Keenan v Simon Prop Group, Inc, 2013 NY Slip Op 03622, 1st Dept, 5-22-13
In determining the appropriate surcharge to be imposed upon an executor which breached its duty to preserve decedent’s tangible property, as well as the appropriate interest rate to impose with respect to a delay in distributing assets, the Second Department wrote:
“[A] nominated executor has the duty to preserve estate assets for the protection of those persons eventually entitled to receive them” … . * * * [W]e find no reason to disturb the Surrogate’s finding that the petitioner breached its duty, thereby warranting the imposition of a surcharge. * * *
Where a surcharge is imposed for a breach of fiduciary duty, it is a matter within the discretion of the trial court whether to award interest upon the surcharge, and at what rate (see CPLR 5001[a]; 5004;…). While the highest rate of interest might be appropriate where the trustee’s breach of duty is willful or characterized by bad faith…, here, the record reflects that the petitioner’s failure in its duty to secure the decedent’s tangible personal property constituted an honest mistake. …
As a general matter, legacies are payable seven months after issuance of letters testamentary unless otherwise directed by the testator or required by the circumstances of the estate, including the executor’s need to retain sufficient funds to cover administrative costs and debts of the decedent (see EPTL 11-1.5[a]…). Under certain circumstances, an executor may retain a disposition as a setoff for a debt owed by the beneficiary to the decedent or the estate …. In a proceeding to compel payment of a disposition or distributive share, “[t]he rate of interest to be paid on a pecuniary bequest is governed by EPTL 11-1.5” …. The court may fix interest on any disposition awarded at the rate of 6% (see EPTL 11-1.5[d]), or, upon the court’s additional finding that the fiduciary’s “delay in payment was unreasonable” (EPTL 11-1.5[e]), the court may fix interest at the annual rate of 9% set forth in CPLR 5004 …. Matter of Marsh, 2013 NY Slip Op 03679, 2nd Dept, 5-22-13
In determining Surrogate’s Court properly determined mortgages secured by notes represented personal property and not “interests in real property” within the meaning of the will, the Second Department wrote:
Here, as the Surrogate’s Court properly recognized, notes secured by mortgages are generally construed to be personal property…, and there is nothing in the language of the decedent’s will that manifests an intent to include the subject notes within the clause devising his “interests in real property” to the petitioner. The construction suggested by the petitioner cannot be accepted since the court should not rewrite a will or supply an omission not necessarily implied by the language used, even though intestacy with respect to a particular asset results … . Matter of Cincotta, 2013 NY Slip Op 03671, 2nd Dept, 5-22-13
The Second Department explained that an action for fraud can not be based on breach of contract allegations:
“The elements of a cause of action sounding in fraud are a material misrepresentation of an existing fact, made with knowledge of the falsity, an intent to induce reliance thereon, justifiable reliance upon the misrepresentation, and damages” …. However, “a cause of action premised upon fraud cannot lie where it is based on the same allegations as the breach of contract claim” …. Where a claim to recover damages for fraud is premised upon an alleged breach of contractual duties, and the allegations with respect to the purported fraud do not concern representations which are collateral or extraneous to the terms of the parties’ agreement, a cause of action sounding in fraud does not lie …. Further, “[g]eneral allegations that defendant entered into a contract while lacking the intent to perform it are insufficient to support [a] claim” of fraudulent inducement… . Fromowitz v W Park Assoc, Inc, 2013 NY Slip Op 03633, 5-22-13
The Second Department determined that causes of action alleging fraudulent conveyances pursuant to Debtor & Creditor Law 276 should not have been dismissed on statute of limitations grounds because the defendants failed to establish when plaintiff should have first become aware of the alleged fraud:
“A cause of action based upon actual fraud under Debtor and Creditor Law § 276 must be brought within six years of the date that the fraud or conveyance occurs, or within two years of the date the fraud should have been discovered, whichever is longer” …. Here, it is undisputed that the verified complaint did not allege the occurrence of any fraudulent conveyances within six years prior to the commencement of the action. However, since it is unclear when the plaintiff should have first been aware of the alleged fraud, the defendants failed to establish that the causes of action alleging actual fraud under Debtor and Creditor Law § 276 should be dismissed as time-barred …. Felshman v Yamali, 2013 NY Slip Op 03632, 2nd Dept, 5-22-13
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