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ALTHOUGH THE ORDER ADDRESSING A MOTION TO SET ASIDE THE VERDICT WAS ISSUED AFTER JUDGMENT AND THEREFORE CANNOT BE SUBSUMED IN THE JUDGMENT, THE ORDER IS APPEALABLE; PRECEDENT TO THE CONTRARY OVERRULED (FOURTH DEPT).

The Fourth Department, in a full-fledged opinion by Justice Troutman, overruling precedent, determined that an order issued after judgment, here an order on a motion to set aside the verdict, can be appealed:

… [W]e must consider whether a party may appeal directly from an order denying a CPLR 4404 motion when that order was entered after entry of a final judgment. In some of our previous cases, we have concluded that such an order is “subsumed in the judgment and the right to appeal directly therefrom terminated” (Paul Revere Life Ins. Co. v Campagna, 233 AD2d 954, 955 [4th Dept 1996] …). We now conclude that the rule set forth in Paul Revere Life Ins. Co. is inconsistent with the statutory framework and with Court of Appeals precedent, and should no longer be followed. Accordingly, we hold that an order otherwise appealable as of right (see CPLR 5701 [a]) entered after the entry of a final judgment is not subsumed in the judgment, but is independently appealable.

An appeal may be taken as of right from an order that, inter alia, “involves some part of the merits,” “affects a substantial right,” or “refuses a new trial” (CPLR 5701 [a] [2] [iii]-[v]). If, however, a court enters an “intermediate order” and subsequently enters a final judgment, the Court of Appeals has held that the entry of the judgment terminates the right to appeal from the order … . Although the right of appeal terminates, the order is not beyond review. There is a statutory remedy. An appeal from the final judgment “brings up for review,” inter alia, “any non-final judgment or order which necessarily affects the final judgment” or “any order denying a new trial” (CPLR 5501 [a] [1], [2]). Thus, CPLR 5501 (a) salvages the ability of aggrieved parties to seek review of the intermediate order on appeal.

On the other hand, orders entered after the entry of a final judgment cannot conceptually merge into the judgment. The rule in Aho [39 NY2d 241] applies only to an “intermediate order” … , which the Court of Appeals has defined as an order “made after the commencement of the action and before the entry of judgment” … . Consequently, inasmuch as the right of appeal from a post-judgment order remains in effect, we conclude that the appeal from the order here is properly before us. Knapp v Finger Lakes NY, Inc., 2020 NY Slip Op 03353, Fourth Dept 6-12-20

 

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THE MEDICAL RECORDS SUBMITTED FOR THE FIRST TIME IN REPLY CAN BE CONSIDERED BECAUSE RESPONDENTS ADDRESSED THE RELEVANT ISSUES AT ORAL ARGUMENT; THE MEDICAL RECORDS DEMONSTRATED RESPONDENTS HAD TIMELY NOTICE OF THE NATURE OF THE CLAIM; ALTHOUGH THE EXCUSE FOR DELAY WAS NOT ADEQUATE, THE DEFECT DID NOT REQUIRE DENIAL OF THE APPLICATION FOR LEAVE TO FILE A LATE NOTICE OF CLAIM; THE APPLICATION SHOULD NOT HAVE BEEN DENIED (FOURTH DEPT).

The Fourth Department, reversing Supreme Court, over a two-justice dissent, determined claimant’s application for leave to file a late notice of claim in this medical malpractice action should have been granted. The court noted that the medical records submitted for the first time in a reply were properly considered because the respondents addressed the relevant issues at oral argument. Both the majority and the dissent noted that the excuse for failure to timely file the notice of claim was inadequate but that defect did not require denial of the application. The majority found claimant demonstrated respondents were not prejudiced by the delay. The dissent disagreed with the majority’s finding that the medical records demonstrated respondents had timely notice of the nature of the claim:

… [W]e reject the contention of respondents and the dissent that it is inappropriate under the circumstances of this case to consider the medical records submitted by claimant for the first time in his reply papers. In general, ” [t]he function of reply papers is to address arguments made in opposition to the position taken by the movant and not to permit the movant to introduce new arguments in support of, or new grounds [or evidence] for the motion [or application]’ ” … . “This rule, however, is not inflexible, and a court, in the exercise of its discretion, may consider a claim or evidence offered for the first time in reply where the offering party’s adversaries responded to the newly presented claim or evidence” … . …

… “[T]he medical records . . . evince that [respondents’] medical staff, by its acts or omissions, inflicted an[ ] injury on [claimant]’ ” … . The medical records indicate that, following the surgical skin graft procedure, claimant developed swelling beneath the dressings that became constrictive of blood flow to the leg and ultimately caused necrosis, and that respondents’ medical staff, for various reasons, had failed to recognize the ischemic nature of the leg and claimant’s development of compartment syndrome, thereby eventually necessitating partial amputation of the leg … . We thus conclude that respondents timely acquired actual knowledge of the essential facts constituting the claim … . Matter of Dusch v Erie County Med. Ctr., 2020 NY Slip Op 03351, Fourth Dept 7-12-20

 

VENUE WAS IMPROPER; DEFENDANTS FOLLOWED THE STATUTORY PROCEDURE AND MOVED FOR A CHANGE OF VENUE; NO OTHER PARTY MOVED FOR A CHANGE OF VENUE; THE MOTION SHOULD HAVE BEEN GRANTED (FIRST DEPT).

The First Department, reversing Supreme Court, determined the defendants’ (Transit Authorities’) motion to change venue should have been granted. Venue was improper, the Transit Authorities followed the correct procedure, and no other party made a motion to change venue:

After plaintiffs commenced this action in Bronx County, the Transit Authorities timely served a demand for a change of venue as of right to New York County, where one of them has its principal office (see CPLR 505[a]; 511). Plaintiffs did not respond to the demand, and the Transit Authorities timely moved to change venue (see CPLR 510[1]; 511[b]). In opposition to the motion, plaintiffs did not dispute that their choice of venue was improper, but requested that venue be placed in Kings County, where the accident occurred. No other defendant timely appeared in opposition to the motion, although the City defendants submitted a belated affirmation asserting that venue should be placed in Kings County under CPLR 504(3).

By failing to respond to the Transit Authorities’ demand to change venue to a proper forum, plaintiffs forfeited their right to select venue … . Further, no party moved to transfer venue to an alternate county … . Thus, once the Transit Authorities had followed the procedure set forth in CPLR 511 and established that the county chosen by plaintiffs was improper, their motion to change venue to New York County as of right should have been granted … . Richardson v City of New York, 2020 NY Slip Op 03281, First Dept 6-11-20

 

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CAYMAN ISLANDS LAW APPLIES IN THIS FRAUDULENT CONVEYANCE ACTION, CRITERIA EXPLAINED (FIRST DEPT).

The First Department, reversing Supreme Court, determined the motion to dismiss this fraudulent conveyance action should have been granted because Cayman Islands law applied and the cause of action was not adequately pled:

“In the context of tort law, New York utilizes interest analysis to determine which of two competing jurisdictions has the greater interest in having its law applied in the litigation” .. . “Given that fraudulent conveyance laws are conduct regulating,’ the law of the jurisdiction where the tort occurred will generally apply because that jurisdiction has the greatest interest in regulating behavior within its borders'” … . ” [T]he locus jurisdiction’s interests in protecting the reasonable expectations of the parties who relied on it to govern their primary conduct[,] and in the admonitory effect that applying its law will have on similar conduct in the future[,] assume critical importance . . . .” … . Further, as “the purpose of fraudulent conveyance laws is to aid creditors who have been defrauded by the transfer of property,” consideration of the residency of the parties, particularly the creditors, is also required to determine their reasonable expectations … . Applying these principles, the law of the Cayman Islands applies to petitioner’s fraudulent conveyance claim. Petitioner, who is the creditor allegedly injured by the fraudulent transfer of the funds at issue, is a Cayman Islands domiciliary. Moreover, petitioner is seeking the return of funds which were allegedly fraudulently transferred to Weston, also a Cayman Islands domiciliary. Additionally, the Cayman Islands has the greatest interest in protecting the reasonable expectations of its residents, both petitioner and respondent Weston, who relied on Cayman Islands law to govern their conduct. Although SIP, the transferor of the funds, is domiciled in Texas, and the bank account into which the funds were transferred is located in New York, it is the Cayman Islands that has the most significant contacts with the matter in dispute. Thus, Cayman Islands law should apply. Matter of Wimbledon Fund, SPC (Class TT) v Weston Capital Partners Master Fund II, Ltd., 2020 NY Slip Op 03279, First Dept 6-11-20

 

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DEFENDANT’S MOTION FOR SUMMARY JUDGMENT IN THIS ASBESTOS-INJURY CASE SHOULD NOT HAVE BEEN GRANTED, PROPER BURDEN OF PROOF EXPLAINED (FIRST DEPT).

The First Department, reversing Supreme Court, determined the defendant’s motion for summary judgment in this asbestos -injury case should not have been granted and, alternatively, even if the motion were properly granted, leave to renew should have been granted based on additional evidence:

In connection with a motion for summary judgment in an action based on exposure to asbestos, defendant has the initial burden of showing “unequivocally” that its product could not have contributed to the causation of decedent’s asbestos-related injury … .

Defendant Burnham failed to sustain its initial burden of demonstrating that its products could not have contributed to decedent’s mesothelioma. Decedent’s testimony identified defendant as the manufacturer of greenhouses in which he worked and cited three possible sources of asbestos: transite benches in the greenhouses, window glazing and the greenhouse boiler. Burnham provided no evidence demonstrating that its products could not have been the source of the asbestos that caused decedent’s illness. It only pointed to gaps in plaintiffs’ proof, which was insufficient to meet its burden … . Even if the burden had shifted, plaintiffs’ evidence in opposition raised an issue of fact as to whether Burnham had sold, distributed, and recommended asbestos-containing products such as those used in plaintiffs’ family’s gardening business. While hearsay, that evidence could be considered by the court since it was not the sole basis of the opposition … .

Alternatively, even if the summary judgment motion had been properly granted, the court should have granted leave to renew in the interests of fairness and justice since plaintiffs presented an affidavit of decedent’s estranged brother, which supplied crucial evidence linking decedent’s illness to Burnham’s products. Fischer v American Biltrite, Inc., 2020 NY Slip Op 03277, First Dept 6-11-20

 

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MOTION FOR CLASS CERTIFICATION BASED UPON ALLEGEDLY ADULTERATED FUEL OIL SHOULD NOT HAVE BEEN GRANTED BECAUSE THE NUMEROSITY REQUIREMENT WAS NOT SUPPORTED BY ADMISSIBLE EVIDENCE; DISMISSAL WAS WITHOUT PREJUDICE AND LEAVE TO RENEW WAS GRANTED (FIRST DEPT).

The First Department, reversing Supreme Court, determined the motion for class certification should have been denied because the proof of the numerosity prerequisite was not in admissible form. The dismissal was without prejudice because it appeared the evidence could be properly presented:

The gravamen of plaintiffs’ claim, and that for which they seek class certification, is that defendant provided them and others similarly situated “with inferior, adulterated heating oil, i.e. that the fuel oil that was delivered to them contained oils of lesser value mixed into the ordered grade of fuel oil, so that the delivered product did not meet the standards of the parties’ contracts” … . Contrary to defendant’s contention, this is the predominant question of law and fact in this case, and it is common among the class. In any event, “the fact that questions peculiar to each individual may remain after resolution of the common questions is not fatal to the class action” … . Moreover, “CPLR article 9 affords the trial court considerable flexibility in overseeing a class action,” and the court could even “decertify the class at any time before a decision on the merits if it becomes apparent that class treatment is inappropriate” … . Supreme Court is more than able to recognize if its class certification becomes unduly cumbersome, and, if so, how best to fashion a remedy.

Nevertheless, “[t]he proponent of class certification bears the burden of establishing the criteria promulgated by CPLR 901(a) and must do so by tender of evidence in admissible form” … . Here, plaintiffs failed to submit admissible evidence demonstrating that the numerosity prerequisite to class certification was satisfied. However, the record suggests that such evidence is in plaintiffs’ possession but simply was not submitted in connection with their motion. Accordingly, plaintiffs are given leave to renew their motion for class certification, upon admissible evidence providing a sufficient basis for determining the size of the potential class. Mid Is. LP v Hess Corp., 2020 NY Slip Op 03270, First Dept 6-11-20

 

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ACCOUNTING CAUSE OF ACTION IN THIS SHAREHOLDERS’ DERIVATIVE SUIT SHOULD NOT HAVE BEEN DISMISSED; ALTHOUGH SUA SPONTE ORDERS ARE NOT APPEALABLE, THE APPEAL WAS HEARD IN THE INTEREST OF JUSTICE; PROPER WAY TO HANDLE A SUA SPONTE ORDER IS TO MOVE TO VACATE AND THEN APPEAL (FIRST DEPT).

The First Department, reversing Supreme Court in this shareholders’ derivative action against a low-income Housing Development Fund Corporation (HDFC), determined: (1) although a sua sponte order is not appealable, the appeal of the dismissal of the cause of action for an accounting is heard in the interest of justice; (2) the proper way to handle a sua sponte order is to move to vacate it and then appeal; (3) there was no need to amend the complaint because the accounting cause of action included the right to damages for wrongdoing (here the alleged failure to account for the sale of an apartment for $90,000):

An order issued sua sponte is not appealable as of right (see CPLR 5701[a][2] …). Plaintiffs’ remedy is to move to vacate the court’s order, and, if the motion is denied, appeal from that order (CPLR 5701[a][3] …). …

… [W]e find that Supreme Court erred in dismissing the complaint because the cause of action for an equitable accounting was not moot. Supreme Court conflated the first cause of action for the inspection of the HDFC’s books and records with the second cause of action for an equitable accounting … . Defendants failed to demonstrate what happened to the $90,000 from the sale of Apartment 6A, and the funds do not appear in the HDFC’s financials. Defendants’ affidavits did not address this glaring deficiency.

… An equitable accounting involves a remedy “designed to require a person in possession of financial records to produce them, demonstrate how money was expended and return pilfered funds in his or her possession” … . Available relief includes a personal judgment against the wrongdoer … . Hall v Louis, 2020 NY Slip Op 03268, First Dept 6-11-20

 

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NO APPEAL LIES FROM DECLINING TO SIGN AN ORDER TO SHOW CAUSE (FIRST DEPT).

The First Department noted that no appeal lies from declining to sign an order to show cause:

No appeal lies from an order declining to sign an order to show cause, since it is an ex parte order that does not decide a motion made on notice (CPLR 5701[a][2] … ). To the extent defendant seeks review of the ex parte order pursuant to CPLR 5704, such relief is denied. Review under CPLR 5704 would not, in any event, address the merits of the motion defendant sought to make by order to show cause … .

To the extent defendant contends that we should review the order or grant leave to appeal in the interest of justice, we decline to do so. Chi Young Lee v Osorio, 2020 NY Slip Op 03186, First Dept 6-4-20

 

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RARE CASE WHERE PLAINTIFF’S SUMMARY JUDGMENT MOTION ON LABOR LAW 200 AND COMMON-LAW NEGLIGENCE CAUSES OF ACTION WAS APPROPRIATELY GRANTED (FIRST DEPT).

The First Department determined this was a rare case where summary judgment was appropriate on a Labor Law 200, common-law negligence cause of action:

Here, PSJV, the entities responsible for site cleanliness and trade coordination, at a time when the project was open to the elements, covered a recessed area of the third floor, where rainwater regularly collected, with non-waterproof planking, and never inspected it for water accumulation. Further, PSJV did not warn plaintiff or his employer that he was working under the recessed area, and when he drilled into the second floor ceiling to affix electrical equipment, the sludgy, oily water poured down onto him, causing him to lose his balance and injure himself. Thus, plaintiffs made a prima showing that the accident occurred due to a defective condition on the premises of which PSJV had actual notice, having caused and created it … . In response, PSJV failed to adduce credible evidence that anyone else, including plaintiff electrician, negligently caused the accident … . Langer v MTA Capital Constr. Co., 2020 NY Slip Op 03171, First Dept 6-3-20

 

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COMPLAINT IN PUTATIVE CLASS ACTION ALLEGING DISCRIMINATION AGAINST PERSONS WHO CANNOT USE STAIRS PROPERLY SURVIVED MOTIONS TO DISMISS; 360 OF 427 NYC SUBWAY STATIONS ARE ACCESSIBLE ONLY BY STAIRS (FIRST DEPT).

The First Department, in a full-fledged opinion by Justice Gische, determined that the transit authority’s and the city’s motions to dismsiss the complaint in this putative class action were properly denied. The complaint, brought pursuant to the NYC Human Rights Law (NYCHRL), alleged discrimination against persons with disabilities which prevent them from using stairs. 360 of the 427 subway stations in NYC are accessible only by stairs. The First Department held: (1) the action was not time-barred because the continuous violation doctrine applied; (2) the action was not preempted by either Transportation Law 15-b or Public Authorities Law 1266 (8); (3) the controversy is justiciable; and (4) the city, which owns the stations, was not entitled to pre-discovery dismissal. With respect to the continuous violation doctrine, the court wrote:

… [T]he reach of the continuous violation doctrine under NYCHRL is broader than under either federal or state law. A broad interpretation is consistent with a “rule that neither penalizes workers who hesitate to bring an action at the first sign of what they suspect could be discriminatory trouble, nor rewards covered entities that discriminate by insulating them[selves] from challenges to their unlawful conduct that continues into the limitation period” … . Thus, defendants’ claimed failure to provide an accessible subway system is a continuous wrong for purposes of tolling the statute of limitations under the NYCHRL Center for Independence of the Disabled v Metropolitan Transp. Auth., 2020 NY Slip Op 03203, First Dept 6-4-20

 

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