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A PUTATIVE CLASS ACTION SUIT ALLEGING MUSEUM ADMISSION TICKETS FAILED TO DISCLOSE THE FULL PRICE OF THE TICKET PROPERLY SURVIVED A MOTION TO DISMISS; THE “VOLUNTARY PAYMENT DOCTRINE” DID NOT APPLY (SECOND DEPT).

The Second Department, in a full-fledged opinion by Justice Ottley, in a matter of first-impression, affirming the denial of the motion to dismiss, determined plaintiff stated a cause of action for a violation of the Arts and Cultural Affairs Law and had standing to bring a class action suit. The essence of the violation was the purported failure to disclose the full price of a ticket for admission to a museum, which included taxes and fees, prior to the ticket purchase. The cause of action is statutory. The “voluntary payment doctrine” was deemed inapplicable:

Arts and Cultural Affairs Law § 25.07(4) provides that the defendant shall disclose the total cost of the ticket, including ancillary fees, prior to the ticket being selected for purchase and that the “service charge, or any other fee or surcharge to the purchaser” be “disclosed in a clear and conspicuous manner” (id.). Arts and Cultural Affairs Law § 25.33 provides that “any person who has been injured by reason of a violation of this article may bring an action in his or her own name to enjoin such unlawful act, an action to recover his or her actual damages or fifty dollars, whichever is greater, or both such actions. The court may award reasonable attorney’s fees to a prevailing plaintiff.” * * *

The voluntary payment doctrine “bars recovery of payments voluntarily made with full knowledge of the facts, and in the absence of fraud or mistake of material fact or law” … .

… [W]e conclude … the voluntary payment doctrine does not bar the plaintiff’s claims alleging violations of Arts and Cultural Affairs Law § 25.07(4) because such claims are predicated on a lack of full disclosure … . Cammayo v 1AND8, Inc., 2026 NY Slip Op 05762, Second Dept 10-7-26

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A PRECLUSION ORDER DOES NOT HAVE THE SAME EFFECT AS STRIKING THE ANSWER; THE DEFENDANT CAN STILL PRESENT LEGAL ARGUMENTS SUPPORTING A MOTION TO DISMISS; HERE THE DEFENDANT CITY AMBULANCE SERVICE WAS PERFORMING A GOVERNMENTAL FUNCTION WHEN DECEDENT WAS INJURED AND WAS ENTITLED TO IMMUNITY IN THE NEGLIGENCE ACTION (SECOND DEPT).

The Second Department, reversing (modifying) Supreme Court, determined the city was entitled to dismissal of the negligence action because the ambulance service was performing a governmental function and no special duty was owed by the city to the decedent. Here the city had failed to meet its discovery obligations and Supreme Court precluded the city from offering evidence. However the city was entitled to make legal arguments in an attorney affirmation to support its motion to dismiss the complaint:

… [A]n order precluding the submission of evidence, unlike the striking of an answer, does not relieve the plaintiff of his or her obligation to establish a prima facie case in the first instance … . The purpose of a preclusion order is to make the demanding party whole … . To further preclude the defendants from asserting defenses which require only general denials, despite the existence of a genuine factual dispute, deprives the defendants of their day in court and gives the plaintiff more relief than is warranted by the defendants’ failure to comply with their disclosure obligations … . Thus, contrary to the plaintiff’s contention, the order … precluding the defendants “from offering any evidence . . . and/or affidavits in support of or in opposition to any dispositive motion,” did not preclude the defendants from submitting legal arguments in an attorney affirmation or from referring to the parties’ pleadings.

When a municipality provides ambulance service by emergency medical technicians in response to a 911 call for assistance, it performs a governmental function and cannot be held liable unless it owed a special duty to the injured party … . As relevant here, a municipality will be held to have voluntarily assumed a duty or special relationship with the plaintiff where there is (1) an assumption by the municipality, through promises or actions, of an affirmative duty to act on behalf of the party who was injured; (2) knowledge on the part of the municipality’s agents that inaction could lead to harm; (3) some form of direct contact between the municipality’s agents and the injured party; and (4) that party’s justifiable reliance on the municipality’s affirmative undertaking … . It is the plaintiff’s obligation to prove that the government defendant owed a special duty of care to the injured party because the duty is an essential element of the negligence claim itself … . Davis v City of New York, 2026 NY Slip Op 05766, Second Dept 10-7-26

Practice Point: Here the city defendant failed to meet its discovery obligations and the court issued an order precluding the city from presenting evidence. However the city was not precluded from making legal arguments in support of its successful motion to dismiss.

Practice Point: The city was entitled to immunity because the city ambulance service was performing a governmental function and there was no special relationship between the city and the decedent.

 

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PLAINTIFF DID NOT DEMONSTRATE THE PROCESS SERVER ACTED WITH “DUE DILIGENCE” BEFORE RESORTING TO “NAIL AND MAIL” SERVICE; THE COURT THEREFORE DID NOT ACQUIRE PERSONAL JURISDICTION OVER DEFENDANT; CRITERIA EXPLAINED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the plaintiff did not demonstrate the process server acted with “due diligence” before resorting to “nail and mail” service:

“Service of process upon a natural person must be made in strict compliance with the statutory methods of service set forth in CPLR 308” … . “Service pursuant to CPLR 308(4) may be used only where personal service under CPLR 308(1) and (2) cannot be made with due diligence” … . “To satisfy the ‘due diligence’ requirement, the plaintiff must demonstrate that the process server made genuine inquiries about the defendant’s whereabouts and place of employment” … . “The failure to serve process in an action leaves the court without personal jurisdiction over the defendant, and all subsequent proceedings are thereby rendered null and void” … .

Here, the plaintiff failed to demonstrate that the process server acted with due diligence before relying on affix and mail service pursuant to CPLR 308(4) … . The process server resorted to service pursuant to CPLR 308(4) after only twice attempting personal service at the defendant’s residence during weekday hours when it could reasonably have been expected that the defendant was either working or in transit to or from work … . Moreover, there was no evidence that the process server made any genuine inquiries about the defendant’s whereabouts and place of business … . Citibank, N.A. v Sagastume, 2026 NY Slip Op 05765, Second Dept 10-7-26

Practice Point: Consult this decision for a clear explanation of the criteria for the exercise of due diligence by a process server. Here the process server made no inquiries about the defendant’s whereabouts or place of business before resorting to “nail and mail.”

 

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THE “DOCTRINE OF PRIMARY JURISDICTION” APPLIED TO THIS BREACH OF CONTRACT ACTION BETWEEN UTILITY PROVIDERS; THE UNDERLYING ACTION SHOULD HAVE BEEN STAYED, NOT DISMISSED, PENDING A RULING BY THE PUBLIC SERVICE COMMISSION (PSC) (FOURTH DEPT).

The Fourth Department, reversing (modifying) Supreme Court, applying the “doctrine of primary jurisdiction,” determined the underlying breach of contract action between the utility providers should have been stayed (not dismissed without prejudice) pending a ruling by the Public Service Commission (PSC):

Although “[t]here is no fixed formula governing the application of the doctrine to the facts of a particular case . . . [,] the court must determine in each case whether the reasons for the doctrine are present and whether the purposes of the doctrine will be served by its application” … . Factors considered by courts in determining whether the doctrine applies include, “(1) whether the question at issue is within the conventional experience of judges or whether it involves technical or policy considerations within the agency’s particular field of expertise; (2) whether the question at issue is particularly within the agency’s discretion; (3) whether there exists a substantial danger of inconsistent rulings; and (4) whether a prior application to the agency has been made” … . * * *

… [W]e conclude that the PSC has primary jurisdiction over plaintiff’s claims because “the determination of the issues involved, under a regulatory scheme, depends upon the specialized knowledge and experience of th[at] agency” … . * * *

… [T]he court abused its discretion to the extent that it dismissed the complaint without prejudice instead of staying the action pending the PSC’s determination in the proceedings pending before it. In determining the appropriate disposition where the primary jurisdiction doctrine applies, “[a] court in its discretion may choose to dismiss the case without prejudice—but only if the parties would not be unfairly disadvantaged” … .  * * * … [B]y dismissing the complaint without prejudice instead of staying the action, the court would unfairly disadvantage plaintiff because, if plaintiff were to commence another action after the PSC issued its determination, the court might dismiss some of its claims on statute of limitations grounds … . Agway Energy Servs., LLC v Central Hudson Gas & Elec. Corp., 2026 NY Slip Op 05621, Fourth Dept 10-2-26

Practice Point: Consult this decision for an in-depth discussion of the applicability of the “primary jurisdiction doctrine” which allows an agency (here the Public Service Commission) to rule before court liligation proceeds.

Practice Point: Whether to stay the court proceedings or dismiss the proceedings without prejudice pending the agency ruling is a matter of discretion. Here the action should have been stayed, not dismissed, because the statute of limitations might preclude plaintiff from alleging certain causes of action in a new complaint.

 

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THE $1 BILLION SETTLEMENT REACHED BY FORMER NFL FOOTBALL PLAYERS AND THE NFL FOR CONCUSSION-RELATED INJURIES WAS DEEMED REASONABLE BY THE FIRST DEPARTMENT (FIRST DEPT). ​

The First Department, modifying Supreme Court, in a full-fledged opinion by Justice Pitt-Burke, determined the class action settlement in the federal multidistrict litigation (MDL) brought by former football players against the National Football League (NFL) for concussion-related injuries was reasonable. The opinion lays out the lengthy history of this litigation and addresses several insurance-contract-interpretation issues which are too complex to fairly summarize here:

While this Court is not bound by the findings of the federal courts on this issue, their determinations provide guidance as to the question of reasonableness before us. Although the MDL settlement was projected to cost $1 billion over its lifetime, given the claims asserted, the extensive publicity and media coverage of the case, and the defense costs, we cannot say the settlement was objectionably unreasonable. In fact, a main contention of the objectors to the settlement in the federal action was that the settlement amount was too lenient (id. at 440). Thus, taking into account the complexity of the claims, “it cannot be said . . . that there was no possibility that litigating the case to the end would result in a judgment . . . in an amount greater than the settlement” … . Discover Prop. & Cas. Co. v National Football League, 2026 NY Slip Op 05595, First Dept 10-1-26

 

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THE DEATH OF A DEFENDANT IN THIS FORECLOSURE PROCEEDING AFFECTED THE MERITS OF THE ACTION; THEREFORE THE DEATH TRIGGERED A STAY OF THE PROCEEDINGS PENDING SUBSTITUTION OF A REPRESENTATIVE; HERE ALL THE DETERMINATIONS OF SUPREME COURT MADE AFTER DEFENDANT’S DEATH WERE A NULLITY (SECOND DEPT).

The Second Department, reversing Supreme Court in this foreclosure action, determined the death of a defendant affected the merits of the action triggering a stay of all proceedings. Therefore the determinations made by Supreme Court after defendant’s death were a nullity:

“Generally, the death of a party divests a court of jurisdiction to act, and automatically stays proceedings in the action pending the substitution of a personal representative for the decedent” … . “Any determination rendered without such a substitution is ordinarily deemed a nullity” … . However, “if a party’s death does not affect the merits of a case, there is no need for strict adherence to the requirement that the proceedings be stayed pending substitution” … . “A judgment of foreclosure and sale entered against a defendant is final as to all questions at issue between the parties, and concludes all matters of defense which were or might have been litigated in the foreclosure action” … . However, “[a] judgment of foreclosure and sale does not divest the mortgagor of its title and interest in the property until the sale is actually conducted” … .

Here, the decedent answered the complaint and was entitled to service of all papers in the action, including any motions to extend the time in which to conduct the foreclosure sale and any notice of sale (see CPLR 2103 …). … [T]he decedent’s death did affect the merits of this action and triggered a stay of all proceedings in the action pending substitution of a legal representative … . Any determinations made by the Supreme Court after the decedent’s death were a nullity, including the amended order and judgment of foreclosure and sale and the orders appealed from … . Real Estate Mtge. Network, Inc. v Perez, 2026 NY Slip Op 05562, Second Dept 9-30-26

Practice Point: Where a defendant’s death affects the merits of the action, the action is stayed pending substitution of a representative.

Practice Point: All rulings made while the action was stayed were a nullity.

Practice Point: A judgment of foreclosure and sale does not divest a mortgagor of title to and interest in the property until the sale is conducted.

 

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THE PARTIES IN THIS FAMILY OFFENSE PROCEEDING HAD NO DIRECT RELATIONSHIP, DEPRIVING FAMILY COURT OF JURISDICTION; THERE MUST BE AN “INTIMATE RELATIONSHIP” BETWEEN THE PARTIES TO CONFER JURISDICTION (SECOND DEPT).

The Second Department, reversing Family Court in this family offense proceeding, determined the petitioner and the appellant (the mother of petitioner’s boyfriend) have no direct relationship. Therefore Family Court did not have jurisdiction over the family offense proceeding (which requires an “intimate relationship”):

Pursuant to Family Court Act § 812(1), the Family Court’s jurisdiction in family offense proceedings is limited to certain prescribed acts that occur “between spouses or former spouses, or between parent and child or between members of the same family or household” … . “[M]embers of the same family or household” include, among others, “persons who are not related by consanguinity or affinity and who are or have been in an intimate relationship regardless of whether such persons have lived together at any time” … . Expressly excluded from the ambit of “intimate relationship” are “casual acquaintance[s]” and “ordinary fraternization between two individuals in business or social contexts” … . Beyond those delineated exclusions, what qualifies as an intimate relationship within the meaning of Family Court Act § 812(1)(e) is determined on a case-by-case basis, and the factors a court may consider include “the nature or type of relationship, regardless of whether the relationship is sexual in nature; the frequency of interaction between the persons; and the duration of the relationship” … .

Here, the parties have no direct relationship and are connected only through a third party, who is the petitioner’s former boyfriend and the appellant’s son … . Additionally, the parties never resided together and their contact with one another was minimal and related only to a few visits between the appellant and the petitioner’s daughter … . Matter of Monahan v Zindman, 2026 NY Slip Op 05538, Second Dept 9-30-26

Practice Point: Here the parties in this family offense proceeding, petitioner and petitioner’s boyfriend’s mother, had no direct relationship. To confer jurisdiction to Family Court in a family offense matter, the parties must have an “intimate relationship.”

 

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THE EVIDENCE PRESENTED BY DEFENDANT WAS NOT SUFFICIENT TO REBUT THE PRIMA FACIE PROOF OF PROPER SERVICE PRESENTED IN THE PROCESS SERVER’S AFFIDAVIT (SECOND DEPT).

The Second Department, reversing Supreme Court, determined defendant’s affidavit was not sufficient to rebut the prima facie demonstration of proper service in the process server’s affidavit:

… [T]he affidavit of service constituted prima facie evidence of valid service pursuant to CPLR 308(1) … . The process server alleged therein that on July 24, 2010, at 8:50 a.m., at the premises, he served the summons and complaint and RPAPL 1303 notice on the defendant by delivery to the defendant personally.

… [T]he defendant failed to rebut the presumption of proper service established by the affidavit of service. In her affidavit submitted in support of the motion, the defendant generally denied receipt of service but failed to specifically address the alleged service at the premises on July 24, 2010 … , or aver that she did not meet the description included in the affidavit of service … . The defendant further provided a letter from the New York City Police Department, Human Resources Division. Although the defendant averred that she was at work at the time she allegedly was served, the evidence submitted failed to establish that she was not at the premises at the time of service … . Rather, the letter merely established that she was employed as a “Police Comm Tech” from July 20, 1987, to January 26, 2018, and that she worked 35 hours per week. Wilmington Sav. Fund Socy., FSB v Bryant, 2026 NY Slip Op 05570, Second Dept 9-30-26

Practice Point: Consult this decision for insight into the nature of the evidence necessary to rebut the prima facie proof of proper service presented in a process server’s affidavit. Here, defendant failed to rebut the presumption of proper service.​

 

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HERE THE DEFENDANT’S AFFIDAVIT SHOULD NOT HAVE BEEN REJECTED BECAUSE IT WAS MADE BY A PARTY; THE AFFIDAVIT WAS BASED ON FIRSTHAND KNOWLEDGE AND WAS COMPETENT TO RAISE A QUESTION OF FACT (FIRST DEPT).

The First Department, reversing Supreme Court, determined that the affidavit which raised a question of fact should not have been rejected because it was made by a party, here the defendant:

… [Defendant’s] affidavit was competent to raise issues of fact as to the parties’ 2007 loan agreement sufficient to preclude summary judgment on [plaintiff’s] breach of contract claim. As we have recognized, “[t]hat an affidavit is submitted by a party or other interested person does not detract from its sufficiency as competent evidence” … . Such is the case here. Indeed, [defendant’s] affidavit provided firsthand knowledge of the transaction with [plaintiff]. .Tahari v Narkis, 2026 NY Slip Op 05505, First Dept 9-29-26

Practice Point: Here an affidavit by a party (defendant) was based on firsthand knowledge and was deemed competent to raise a question of fact.

 

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HERE THE EVIDENCE SUBMITTED BY AN ATTORNEY AFFIRMATION WAS REJECTED BECAUSE IT DID NOT STATE THAT IT WAS MADE “UNDER THE PENALTIES OF PERJURY UNDER THE LAWS OF NEW YORK, WHICH MAY INCLUDE A FINE OR IMPRISONMENT” (FIRST DEPT).

The First Department, reversing Supreme Court, determined the evidence submitted by attorney affirmation was not in admissible form:

… [P]laintiff failed to proffer evidence in admissible form, as all of its evidence was submitted by way of an attorney affirmation that failed to substantially conform to the language of CPLR 2106, which requires any affirmation to explicitly state that it is made “under the penalties of perjury under the laws of New York, which may include a fine or imprisonment” … . Interasian Digital Tech. Holdings Ltd. v In Jin Moon Park, 2026 NY Slip Op 05478, First Dept 9-29-26

Practice Point: Evidence submitted by attorney affirmation will be rejected if the affirmation does not include the language mandated by CPLR 2106.