You are here: / Civil Procedure
,

SELF-EXECUTING CONDITIONAL DISCOVERY ORDER BECAME ABSOLUTE UPON NON-COMPLIANCE; A MOTION TO VACATE, NOT AN APPEAL, IS THE PROPER PROCEDURE TO CONTEST THE ORDER ON THE GROUND OF EXCUSABLE DEFAULT; DEFENDANTS TOOK NO ACTION TO AVOID THE DEFAULT (FIRST DEPT).

The First Department noted that defendants’ failure to comply with a self-executing, conditional order striking the answer became absolute. The proper way to contest such an order is to move to vacate, not appeal:

When defendants failed to comply with the self-executing, conditional order striking their answer if they did not produce a witness for deposition by a date certain, the order became absolute ( … CPLR 3126[3]). Defendants’ proper recourse was to move to vacate the conditional order on the ground of excusable default (… CPLR 5015[a]). They did not seek that relief. In any event, the excuses for failing to comply with the court’s order that defendants asserted in opposition to plaintiff’s motion were not reasonable, and defendants failed to seek an adjournment from the court or take any other action to avoid their knowing default. Humble Monkey, LLC v Rice Sec., LLC, 2020 NY Slip Op 03470, First Dept 6-18-20

 

, , ,

THE IMMEDIATE NEIGHBORS HAD STANDING TO CONTEST THE APPROVAL OF THE CONSTRUCTION OF A DOLLAR STORE; THE PLANNING BOARD DID NOT NEED TO SEND THE MATTER TO THE ZONING BOARD OF APPEALS TO INTERPRET A ZONING ORDINANCE WHICH WAS ONLY A GUIDELINE CONCERNING THE ALLOWED LENGTH OF A BUILDING FACADE; THE PLANNING BOARD TOOK THE REQUISITE HARD LOOK PURSUANT TO THE STATE ENVIRONMENTAL QUALITY REVIEW ACT (SEQRA) (THIRD DEPT).

The Third Department, reversing Supreme Court, noting that the abutting neighbors (Cady and Crawley) had standing to contest the town planning board’s approval of the construction of a Dollar Store, determined Supreme Court should not have found that the matter must be sent to the Zoning Board of Appeals (ZBA) for a variance proceeding. Because the zoning ordinance in question, concerning the length of a building facade, was only a guideline, it was not necessary to involve the ZBA to interpret it:

Cady and Cawley’s residence is directly adjacent to the proposed construction site, and the proposed retail store would be directly across the woods from their property. The store’s main parking lot, which is located behind the store, is in the line of sight of Cady and Cawley’s property. As a result, the store is likely to obstruct or interfere with the scenic views within the scenic viewshed overlay district from Cady and Cawley’s property. Cady and Cawley have standing because they have demonstrated that they would suffer an “injury in fact – i.e., actual harm by the action challenged that differs from that suffered by the public at large — and that such injury falls within the zone of interests, or concerns sought to be promoted or protected by the statutory provision under which the agency has acted” … . * * *

… [T]he Town zoning code states that “the length of any faÇade should generally not exceed 50 feet maximum [horizontal dimension]”. Insofar as the subject provision lacks any compulsory language, … this provision is deliberately phrased …  as a guideline, rather than as a prohibition; in other words, there was no requirement for a referral to the ZBA to determine the plain language of the statute. …

… [O]ur review of the record reveals that the Planning Board underwent a nearly four-year process that involved in-depth environmental impact reports, multiple draft EISes [environmental impact statements] and public hearings, which formed the basis of the FEIS [final environments impact statement] and SEQRA [State Environmental Quality Review Act] findings statement. Accordingly, we find that the Planning Board complied with its procedural and substantive requirements under SEQRA … . Matter of Arthur M. v Town of Germantown Planning Bd., 2020 NY Slip Op 03440, Third Dept 6-18-20

 

,

ONCE A STIPULATION OF DISCONTINUANCE WAS FILED SUPREME COURT LACKED ANY SUPERVISORY CONTROL OVER THE PROCEEDING AND THE MOTION PRACTICE SEEKING TO SET ASIDE THE SETTLEMENT SHOULD HAVE BEEN DENIED ON THAT GROUND; A PLENARY ACTION WAS REQUIRED (THIRD DEPT). ​

The Third Department, reversing Supreme Court, determined once the stipulation of discontinuance was filed Supreme Court lacked any supervisory control over the proceedings. So the subsequent motions dealing with the allocation of settlement proceeds to the plaintiffs and their attorney should have been denied. After the stipulation of discontinuance a plenary action was required to enforce or set aside the settlement:

As contemplated by the stipulation and order, counsel for the parties executed a stipulation of discontinuance that was filed with the Albany County Clerk (see CPLR 3217 [a] [2]). The filing occurred before any of the motion practice at issue and, as a result, a plenary action was required “to enforce [or set aside] the settlement since the court does not retain the power to exercise supervisory control over previously terminated actions and proceedings” … . Indeed, “[w]hen an action is discontinued, it is as if it had never been,” and Supreme Court lacked authority to grant any of the requested relief … . It follows that both motions should have been denied in their entirety. DeLap v Serseloudi, 2020 NY Slip Op 03443, Third Dept 6-18-20

 

, , ,

UNDER THE TERMS OF THE EMPLOYMENT AGREEMENT AND THE APPLICABLE INSURANCE LAW PROVISIONS, AND UNDER THE PRINCIPLES OF UNJUST ENRICHMENT, PLAINTIFF EMPLOYEE, NOT DEFENDANT EMPLOYER, WAS ENTITLED TO THE DEMUTUALIZATION PROCEEDS WHEN THE MEDICAL MALPRACTICE INSURANCE CARRIER CONVERTED FROM A MUTUAL TO A STOCK INSURANCE COMPANY, DESPITE THE FACT THAT THE DEFENDANT EMPLOYER PAID THE POLICY PREMIUMS (THIRD DEPT).

The Third Department, reversing Supreme Court, in a full-fledged opinion by Justice Mulvey, dealt with insurance law, employment law, contract law, unjust enrichment and stare decisis in this dispute between defendant employer and plaintiff employee over the “demutualization” proceeds of an insurance policy. Plaintiff was employed as a certified nurse midwife by defendant. As part of the employment agreement defendant was required to maintain and pay the premiums for a malpractice insurance policy. When the insurance company (MLMIC) converted from a mutual insurance company to a stock insurance company (demutualization) the policyholder was entitled to nearly $75,000. Plaintiff-employee claimed the money was hers and brought an action for a declaratory judgment. Supreme Court agreed with plaintiff but, because there was no on-point appellate decision by the Court of Appeals or the Third Department, Supreme Court was required to follow a First Department decision and, based on that decision, found in favor of defendant-employer. The Third Department noted that it, unlike Supreme Court, was not bound by stare decisis and reversed:

… [P]er the relevant statute [(Insurance Law § 7307 [e] [3])] and the conversion plan’s definitions, plaintiff was entitled to the cash consideration … . * * *

… [T]he parties’ employment agreement provided that plaintiff would perform professional services for defendant. In exchange, defendant would pay her a stated salary and provide specified benefits including, as relevant here, obtaining and paying the premiums for professional liability insurance covering plaintiff. The record indicates that defendant purchased, controlled and maintained such a policy from MLMIC in plaintiff’s favor. Defendant was the policy administrator, selected the coverage and terms, and was responsible for all financial aspects of the policy. Notably, defendant paid annual premiums of approximately $25,710; plaintiff paid nothing toward the premiums and those amounts were not counted as income to plaintiff. Defendant received from MLMIC dividends, premium reductions and the return of premiums when the policy was canceled upon plaintiff leaving defendant’s employ, all without any objection by plaintiff. * * *

The reality is that neither party here bargained for the demutualization proceeds. Moreover, neither party actually paid for them, because membership interests in a mutual insurance company are not paid for by policy premiums; such rights are “acquired . . . at no cost, but rather as an incident of the structure of mutual insurance policies,” through operation of law and the company’s charter and bylaws … . * * *

Neither party changed its position based on demutualization and plaintiff’s conduct was neither tortious nor fraudulent. … [W]e conclude that defendant failed to meet its burden to establish its affirmative defense and counterclaim alleging unjust enrichment. Schoch v Lake Champlain OB-GYN, P.C., 2020 NY Slip Op 03444, Third Dept 6-18-20

 

, ,

ALTHOUGH THE RELEASE EXECUTED BY PLAINTIFF WITH RESPECT TO TWO DEFENDANTS PRECLUDED AN ACTION FOR CONTRIBUTION BY A THIRD DEFENDANT WHICH WAS NOT A PARTY TO THE RELEASE, IT DID NOT PRECLUDE AN ACTION FOR COMMON-LAW INDEMNIFICATION (THIRD DEPT).

The Third Department, reversing (modifying) Supreme Court, determined the release executed by plaintiff in this workplace injury case precluded a contribution action by a defendant which was not a party to the release, but did not preclude an action for common-law indemnification:

In 2016, plaintiff was allegedly injured while working at a commercial construction site. Plaintiff accepted $2,000 in settlement of his claims against third-party defendants, Village Air and Electric, Inc. and Jimerico Construction, Inc. — his employer and the contractor that retained it to do work at the construction site, respectively — and executed a release agreeing to hold them harmless. He then commenced this action against defendant, another contractor whose employees had allegedly caused the condition that led to his injuries. Defendant answered and impleaded Village Air and Jimerico, claiming that it was entitled to contribution and/or indemnification.

Jimerico moved … to dismiss the third-party complaint on the ground that the release executed by plaintiff defeated the contribution and indemnification claims (see CPLR 3211 [a] [5]; General Obligations Law § 15-108) … .

… [T]he release executed by plaintiff “relieve[d] [Jimerico] from liability to any other person for contribution” pursuant to CPLR article 14 and, as a result, Supreme Court should have dismissed defendant’s contribution claim against Jimerico (General Obligations Law § 15-108 [b] …). In contrast, Jimerico’s “settlement with . . . plaintiff did not preclude [defendant] from seeking common-law indemnification from” it … . Koretnicki v Northwoods Concrete, Inc., 2020 NY Slip Op 03445, Third Dept 6-18-20

 

, , ,

SUPREME COURT WAS BOUND TO FOLLOW A FIRST DEPARTMENT DECISION BECAUSE THERE WERE NO ON-POINT DECISIONS FROM THE THIRD DEPARTMENT OR THE COURT OF APPEALS; HOWEVER THE THIRD DEPARTMENT IS NOT SO BOUND; SUPREME COURT REVERSED (THIRD DEPT).

The Third Department, reversing Supreme Court, dealt with the issue of stare decisis in this dispute between defendant employer and plaintiff employee over the “demutualization” proceeds of an insurance policy. Plaintiff was employed as a certified nurse midwife by defendant. As part of the employment agreement defendant was required to maintain and pay the premiums for a malpractice insurance policy. When the insurance company converted from a mutual insurance company to a stock insurance company (demutualization) the policyholder was entitled to nearly $50,000. Plaintiff-employee claimed the money was hers and brought an action for a declaratory judgment. Supreme Court agreed with plaintiff but, because there was no on-point appellate decision by the Court of Appeals or the Third Department, Supreme Court was required to follow a First Department decision and, based on that decision, found in favor of defendant-employer. The Third Department noted that it, unlike Supreme Court, was not bound by stare decisis and reversed:

Initially, Supreme Court was “bound by the doctrine of stare decisis to apply precedent established in another Department,” as no relevant precedent was available from this Court or the Court of Appeals … . However, this Court is not so bound … . We agree with Supreme Court’s inclinations — although that court was constrained by stare decisis not to follow them — and disagree with the First Department’s holding in Matter of Schaffer, Schonholz & Drossman, LLP v Title (171 AD3d at 465 …). Therefore, for the reasons stated in our decision in Schoch v Lake Champlain OB-GYN, P.C. (___ AD3d ___ [decided herewith]), we reverse. Shoback v Broome Obstetrics & Gynecology, P.C., 2020 NY Slip Op 03447, Third Dept 6-18-20

 

, ,

PLAINTIFF SOUGHT ONLY CANCELLATION OF A MORTGAGE; THE JUDGE SHOULD NOT HAVE, SUA SPONTE, CANCELLED THE NOTE AS WELL (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the judge should not have, sua sponte, granted relief that was not asked for by the plaintiff. Plaintiff sought cancellation and discharge of a mortgage pursuant to Real Property Actions and Proceedings Law (RPAPL) 1501(4). The judge cancelled the mortgage and the note:

“The court may grant relief that is warranted pursuant to a general prayer for relief contained in a notice of motion if the relief granted is not too dramatically unlike the relief sought, the proof offered supports it, and there is no prejudice to any party” … . Here, the plaintiff only sought cancellation and discharge of the subject mortgage, not cancellation of the note. The Supreme Court should not have granted additional relief sua sponte … . We note that the plaintiff lacked standing to seek cancellation of the note, as it was not a party to it. Trenton Capital, LLC v Bank of N.Y. Mellon, 2020 NY Slip Op 03416, Second Dept 6-17-20

 

,

ALTHOUGH AN INCOMPLETE CHANGE-OF-ATTORNEY STIPULATION WAS FILED BEFORE THE STIPULATION OF DISCONTINUANCE WAS FILED, THE STIPULATION OF DISCONTINUANCE REMAINED VALID AND ENFORCEABLE (SECOND DEPT).

The Second Department, reversing Supreme Court, determined a stipulation of discontinuance executed by the plaintiff’s then attorney, and filed after plaintiff’s change-of-attorney stipulation was filed, was valid and enforceable. Plaintiff’s change-of-attorney stipulation was not signed by an agent or representative of the plaintiff:

” [A]n attorney of record in an action may only withdraw or be changed or discharged in the manner prescribed by statute'” … . Pursuant to CPLR 321(b), an attorney of record may be changed either by filing with the clerk a consent to the change signed by the retiring attorney and signed and acknowledged by the party, with notice of the change given to the attorneys for all parties in the action, or by order of court upon notice to all parties. ” Until an attorney of record withdraws or is changed or discharged in the manner prescribed by CPLR 321, his [or her] authority as attorney of record for his [or her] client continues, as to adverse parties, unabated'” … .

Here, the stipulation of discontinuance was executed by an attorney with the plaintiff’s then attorney of record … (hereinafter outgoing counsel). Though the plaintiff’s stipulation to change its attorney was filed prior to the date on which the stipulation of discontinuance was filed, and was signed by outgoing counsel and incoming counsel, no agent or representative of the plaintiff signed the change-of-attorney stipulation. Nor does the record establish that notification of the plaintiff’s change in attorney was provided to any other party, or to the appellant, prior to the date on which the stipulation of discontinuance was filed. Accordingly, the plaintiff neither filed a properly signed consent to change attorney form nor sought a court order permitting outgoing counsel to withdraw as the plaintiff’s attorney of record in accordance with CPLR 321(b) prior to the filing of the stipulation of discontinuance.  GMAC Mtge., LLC v Galvin, 2020 NY Slip Op 03405, Second Dept 6-17-20

 

, ,

PLAINTIFF WAS NOT BARRED FROM SEEKING RENT OVERCHARGES BASED UPON A 1986 RENT REDUCTION ORDER (SECOND DEPT).

he Second Department, reversing Supreme Court, determined plaintiff could seek rent overcharges based upon a 1986 rent reduction order:

… [T]he plaintif’s first cause of action to recover damages for rent overcharges based upon the May 1, 1986, rent reduction order was not barred by the then-applicable four-year statute of limitations and the “look-back rule,” precluding examination of the rental history prior to the four-year period preceding commencement of the action (see former Rent Stabilization Law of 1969 [Administrative Code of City of NY] § 26-516[a][2]; former CPLR 213-a; Matter of Regina Metro. Co., LLC v New York State Div. of Hous. & Community Renewal, _____ NY3d _____, 2020 NY Slip Op 02127). Since rent reduction orders impose a continuing obligation on landlords, tenants are entitled to recover for any rent overcharges occurring during the applicable limitations period by reference to rent reduction orders that remain in effect during that period, even if the rent reduction order was initially issued outside the limitations period … . Santana v Fernandez, 2020 NY Slip Op 03383, Second Dept 6-17-20

 

, ,

PLAINTIFF WAS WORKING ON A ROOF WHEN HE ALLEGEDLY CONTACTED AN ELECTRIC WIRE LEADING TO THE HOME AND WAS KILLED; THE UTILITIES’ (CON EDISON’S) MOTION TO DISMISS FOR FAILURE TO STATE A CAUSE OF ACTION ON THE GROUND IT OWED NO DUTY TO PLAINTIFF’S DECEDENT SHOULD NOT HAVE BEEN GRANTED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the complaint against the Con Edison defendants in this electrocution case should not have been dismissed for failure to state a cause of action. Plaintiff was working on a roof when he alleged came into contact with an electric wire attached to the home and was killed. Con Edison argued it did not owe a duty to plaintiff’s decedent:

“[T]he existence and scope of a duty is a question of law requiring courts to balance sometimes competing public policy considerations” …. Contrary to Con Edison’s contention, it failed to establish that it owed no duty to the decedent … . Viewing the allegations in the light most favorable to the plaintiff, since the plaintiff alleged that Con Edison authorized the installation of an improper and non code-compliant connection between its electrical lines and the homeowner’s electrical system, such actions gave rise to Con Edison’s duty to the decedent who reasonably could be expected to come into contact with the property’s electrical wires … . Thus, Con Edison did not establish that the plaintiff failed to state a cause of action to recover damages for negligence. Sucre v Consolidated Edison Co. of N.Y., Inc., 2020 NY Slip Op 03377, Second Dept 6-17-20

 

Categories

Sign Up for the Mailing List to Be Notified When the Site Is Updated.

  • This field is for validation purposes and should be left unchanged.

Copyright © 2026 New York Appellate Digest, Inc.
Site by CurlyHost | Privacy Policy