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CONTRACT WAS ENFORCEABLE DESPITE PARTIES’ EXPECTATION A MORE FORMAL CONTRACT WOULD BE EXECUTED LATER, PLAINTIFF’S MOTION TO CONFORM THE COMPLAINT TO THE PROOF AT TRIAL SHOULD HAVE BEEN GRANTED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined an enforceable real estate purchase contract had been formed and plaintiff’s motion to conform the complaint to the proof at trial should have been granted. The court noted that the parties’ expectation that a more formal contract will be executed later is not really relevant:

Although Berger [defendant’s principal] testified that he expected that a final contract would be signed after it had been put in “proper form” by an attorney, “the existence of a binding contract is not dependent on the subjective intent of [the parties]” … . “In determining whether the parties entered into a contractual agreement and what were its terms, it is necessary to look, rather, to the objective manifestations of the intent of the parties as gathered by their expressed words and deeds” … . Notably, the …  contract contains all of the essential terms of a contract for the sale of real property, designated the parties, and identified and described the subject matter of the contract . The contract was signed … , and all changes to the contract were initialed … . Moreover, the contract contained no provision indicating that an additional signed agreement would be necessary to create a binding agreement … and, even where the parties “anticipat[e] that a more formal contract will be executed later, the contract is enforceable if it embodies all the essential terms of the agreement” … . …

The Supreme Court improvidently exercised its discretion in denying the plaintiff’s motion to conform its complaint to the proof at trial (see CPLR 3025[c]). “[A]bsent prejudice, courts are free to permit amendment even after trial” … . “The burden of establishing prejudice is on the party opposing the amendment” … . “Prejudice, of course, is not found in the mere exposure of the defendant to greater liability. Instead, there must be some indication that the defendant has been hindered in the preparation of his case or has been prevented from taking some measure in support of his position” … . Here, in opposition to the plaintiff’s motion, the defendants failed to show that the amendment would hinder the preparation of their cases or prevent them from taking some measure in support of their positions at trial and, therefore, the plaintiff’s motion to conform its complaint to the proof should have been granted. Metropolitan Lofts of NY, LLC v Metroeb Realty 1, LLC, 2018 NY Slip Op 02319, Second Dept 4-4-18

​CONTRACT LAW CONTRACT WAS ENFORCEABLE DESPITE PARTIES’ EXPECTATION A MORE FORMAL CONTRACT WOULD BE EXECUTED LATER (SECOND DEPT))/CIVIL PROCEDURE (PLAINTIFF’S MOTION TO CONFORM THE COMPLAINT TO THE PROOF AT TRIAL SHOULD HAVE BEEN GRANTED (SECOND DEPT))/COMPLAINT (CONFORM TO PROOF AT TRIAL, PLAINTIFF’S MOTION TO CONFORM THE COMPLAINT TO THE PROOF AT TRIAL SHOULD HAVE BEEN GRANTED (SECOND DEPT))/EVIDENCE (CIVIL PROCEDURE, COMPLAINT, PLAINTIFF’S MOTION TO CONFORM THE COMPLAINT TO THE PROOF AT TRIAL SHOULD HAVE BEEN GRANTED (SECOND DEPT))/CONFORM TO PROOF AT TRIAL (CIVIL PROCEDURE, COMPLAINT, PLAINTIFF’S MOTION TO CONFORM THE COMPLAINT TO THE PROOF AT TRIAL SHOULD HAVE BEEN GRANTED (SECOND DEPT))

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FAILURE TO LIST CAUSE OF ACTION AGAINST DEFENDANT IN A BANKRUPTCY SCHEDULE OF ASSETS PRECLUDED SUIT UNDER THE DOCTRINE OF JUDICIAL ESTOPPEL, MOTION TO AMEND ANSWER TO INCLUDE JUDICIAL ESTOPPEL DEFENSE PROPERLY GRANTED (SECOND DEPT).

The Second Department determined defendant’s (Hurst’s) motion to amend her answer and her motion to dismiss on judicial estoppel grounds were properly granted. Plaintiff had failed to list a cause of action against defendant in her bankruptcy proceeding. Judicial estoppel therefore precluded plaintiff’s action against defendant:

In the absence of prejudice or surprise to the opposing party, leave to amend a pleading should be freely granted unless the proposed amendment is palpably insufficient or patently devoid of merit (see CPLR 3025[b]…). Lateness alone is not a barrier to the amendment … .” It must be lateness coupled with significant prejudice to the other side, the very elements of the laches doctrine'”… . The determination to permit or deny amendment is committed to the sound discretion of the trial court … .

Contrary to the plaintiff’s contention, Hurst’s proposed judicial estoppel defense based on its failure to schedule its current claims against her in its third bankruptcy proceeding was not palpably insufficient or patently devoid of merit. The doctrine of judicial estoppel precludes a party from taking a position in one legal proceeding which is contrary to that which it took in a prior proceeding, simply because its interests have changed … . “The twin purposes of the doctrine are to protect the integrity of the judicial process and to protect judicial integrity by avoiding the risk of inconsistent results in two proceedings'”… . “[T]he integrity of the bankruptcy system depends on full and honest disclosure by debtors of all of their assets”… . By failing to list causes of action on bankruptcy schedules of assets, the debtor represents that it has no such claims … . Thus, the doctrine of judicial estoppel may bar a party from pursuing claims which were not listed in a previous bankruptcy proceeding … . Moran Enters., Inc. v Hurst, 2018 NY Slip Op 02321, Second Dept 4-4-18

​CIVIL PROCEDURE (AMEND ANSWER, JUDICIAL ESTOPPEL, FAILURE TO LIST CAUSE OF ACTION AGAINST DEFENDANT IN A BANKRUPTCY SCHEDULE OF ASSETS PRECLUDED SUIT UNDER THE DOCTRINE OF JUDICIAL ESTOPPEL, MOTION TO AMEND ANSWER TO INCLUDE JUDICIAL ESTOPPEL DEFENSE PROPERLY GRANTED (SECOND DEPT))/ANSWER, AMEND (FAILURE TO LIST CAUSE OF ACTION AGAINST DEFENDANT IN A BANKRUPTCY SCHEDULE OF ASSETS PRECLUDED SUIT UNDER THE DOCTRINE OF JUDICIAL ESTOPPEL, MOTION TO AMEND ANSWER TO INCLUDE JUDICIAL ESTOPPEL DEFENSE PROPERLY GRANTED (SECOND DEPT))/JUDICIAL ESTOPPEL (BANKRUPTCY, FAILURE TO LIST CAUSE OF ACTION AGAINST DEFENDANT IN A BANKRUPTCY SCHEDULE OF ASSETS PRECLUDED SUIT UNDER THE DOCTRINE OF JUDICIAL ESTOPPEL, MOTION TO AMEND ANSWER TO INCLUDE JUDICIAL ESTOPPEL DEFENSE PROPERLY GRANTED (SECOND DEPT))/BANKRUPTCY (SCHEDULE OF ASSETS, JUDICIAL ESTOPPEL, FAILURE TO LIST CAUSE OF ACTION AGAINST DEFENDANT IN A BANKRUPTCY SCHEDULE OF ASSETS PRECLUDED SUIT UNDER DOCTRINE OF JUDICIAL ESTOPPEL, MOTION TO AMEND ANSWER TO INCLUDE JUDICIAL ESTOPPEL DEFENSE PROPERLY GRANTED (SECOND DEPT))/SCHEDULE OF ASSETS (BANKRUPTCY, JUDICIAL ESTOPPEL (FAILURE TO LIST CAUSE OF ACTION AGAINST DEFENDANT IN A BANKRUPTCY SCHEDULE OF ASSETS PRECLUDED SUIT UNDER THE DOCTRINE OF JUDICIAL ESTOPPEL, MOTION TO AMEND ANSWER TO INCLUDE JUDICIAL ESTOPPEL DEFENSE PROPERLY GRANTED (SECOND DEPT))/CPLR 3025 (AMEND ANSWER, JUDICIAL ESTOPPEL, FAILURE TO LIST CAUSE OF ACTION AGAINST DEFENDANT IN A BANKRUPTCY SCHEDULE OF ASSETS PRECLUDED SUIT UNDER THE DOCTRINE OF JUDICIAL ESTOPPEL, MOTION TO AMEND ANSWER TO INCLUDE JUDICIAL ESTOPPEL DEFENSE PROPERLY GRANTED (SECOND DEPT))

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IN A DECISION POTENTIALLY AFFECTING HUNDREDS OF RECENT SUMMARY JUDGMENT RULINGS, THE COURT OF APPEALS HELD THAT A PLAINTIFF NEED NOT DEMONSTRATE FREEDOM FROM COMPARATIVE FAULT TO BE ENTITLED TO PARTIAL SUMMARY JUDGMENT ON LIABILITY IN NEGLIGENCE CASES, COMPARATIVE NEGLIGENCE IS PURELY A DAMAGES ISSUE (CT APP).

The Court of Appeals, in a full-fledged opinion by Judge Feinman, over a three-judge dissenting opinion, reversing the appellate division (and potentially affecting hundreds of recent rulings on summary judgment motions in negligence cases), determined that a plaintiff need not demonstrate the absence of comparative fault to be entitled to partial summary judgment on liability. Whether the plaintiff was comparatively negligent is, under the controlling statutes, is a damages issue:

CPLR 3212, which governs summary judgment motions, provides that “[t]he motion shall be granted if . . . the cause of action . . . [is] established sufficiently to warrant the court as a matter of law in directing judgment in favor of any party” … . The motion for summary judgment must also “show that there is no defense to the cause of action” … . Further, subsection [c] of the same section sets forth the procedure for obtaining partial summary judgment and states that “[i]f it appears that the only triable issues of fact arising on a motion for summary judgment relate to the amount or extent of damages . . . the court may, when appropriate for the expeditious disposition of the controversy, order an immediate trial of such issues of fact raised by the motion” … .

Article 14-A of the CPLR contains our State’s codified comparative negligence principles. CPLR 1411 provides that:

“In any action to recover damages for personal injury, injury to property, or wrongful death, the culpable conduct attributable to the claimant or to the decedent, including contributory negligence or assumption of risk shall not bar recovery, but the amount of damages otherwise recoverable shall be diminished in the proportion which the culpable conduct attributable to the claimant or decedent bears to the culpable conduct which caused the damages.” … .

CPLR 1412 further states that “[c]ulpable conduct claimed in diminution of damages, in accordance with [CPLR 1411], shall be an affirmative defense to be pleaded and proved by the party asserting the defense.” Placing the burden on the plaintiff to show an absence of comparative fault is inconsistent with the plain language of CPLR 1412. Rodriguez v City of New York, 2018 NY Slip Op 02287, CtApp 4-3-18

​NEGLIGENCE (COMPARATIVE NEGLIGENCE, SUMMARY JUDGMENT, IN A DECISION POTENTIALLY AFFECTING HUNDREDS OF RECENT SUMMARY JUDGMENT RULINGS, THE COURT OF APPEALS HELD THAT A PLAINTIFF NEED NOT DEMONSTRATE FREEDOM FROM COMPARATIVE FAULT TO BE ENTITLED TO PARTIAL SUMMARY JUDGMENT ON LIABILITY IN NEGLIGENCE CASES, COMPARATIVE NEGLIGENCE IS PURELY A DAMAGES ISSUE (CT APP))/CIVIL PROCEDURE (NEGLIGENCE, SUMMARY JUDGMENT, IN A DECISION POTENTIALLY AFFECTING HUNDREDS OF RECENT SUMMARY JUDGMENT RULINGS, THE COURT OF APPEALS HELD THAT A PLAINTIFF NEED NOT DEMONSTRATE FREEDOM FROM COMPARATIVE FAULT TO BE ENTITLED TO PARTIAL SUMMARY JUDGMENT ON LIABILITY IN NEGLIGENCE CASES, COMPARATIVE NEGLIGENCE IS PURELY A DAMAGES ISSUE (CT APP))/SUMMARY JUDGMENT (NEGLIGENCE, COMPARATIVE NEGLIGENCE, IN A DECISION POTENTIALLY AFFECTING HUNDREDS OF RECENT SUMMARY JUDGMENT RULINGS, THE COURT OF APPEALS HELD THAT A PLAINTIFF NEED NOT DEMONSTRATE FREEDOM FROM COMPARATIVE FAULT TO BE ENTITLED TO PARTIAL SUMMARY JUDGMENT ON LIABILITY IN NEGLIGENCE CASES, COMPARATIVE NEGLIGENCE IS PURELY A DAMAGES ISSUE (CT APP))/COMPARATIVE NEGLIGENCE (SUMMARY JUDGMENT, IN A DECISION POTENTIALLY AFFECTING HUNDREDS OF RECENT SUMMARY JUDGMENT RULINGS, THE COURT OF APPEALS HELD THAT A PLAINTIFF NEED NOT DEMONSTRATE FREEDOM FROM COMPARATIVE FAULT TO BE ENTITLED TO PARTIAL SUMMARY JUDGMENT ON LIABILITY IN NEGLIGENCE CASES, COMPARATIVE NEGLIGENCE IS PURELY A DAMAGES ISSUE (CT APP))/DAMAGES (NEGLIGENCE, COMPARATIVE NEGLIGENCE, SUMMARY JUDGMENT, IN A DECISION POTENTIALLY AFFECTING HUNDREDS OF RECENT SUMMARY JUDGMENT RULINGS, THE COURT OF APPEALS HELD THAT A PLAINTIFF NEED NOT DEMONSTRATE FREEDOM FROM COMPARATIVE FAULT TO BE ENTITLED TO PARTIAL SUMMARY JUDGMENT ON LIABILITY IN NEGLIGENCE CASES, COMPARATIVE NEGLIGENCE IS PURELY A DAMAGES ISSUE (CT APP))

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INSUFFICIENT EVIDENCE OF HOW THE ACCIDENT OCCURRED IN THIS LABOR LAW 240 (1) ACTION, DISCOVERY MAY AID THE INQUIRY, SUMMARY JUDGMENT AWARD WAS PREMATURE (CT APP).

The Court of Appeals, in a memorandum which did not describe the facts, reversing the appellate division, determined the award of summary judgment to the plaintiff in this Labor Law 240 (1) action was premature. There was insufficient evidence of how the accident occurred and discovery might aid in that regard:

Here, where there is insufficient evidence concerning how the accident occurred, the requested discovery could aid in establishing what happened, and the note of issue was not due to be filed for another six months, summary judgment was prematurely granted … . Somereve v Plaza Constr. Corp., 2018 NY Slip Op 02288, CtApp 4-3-18

​LABOR LAW-CONSTRUCTION LAW (INSUFFICIENT EVIDENCE OF HOW THE ACCIDENT OCCURRED IN THIS LABOR LAW 240 (1) ACTION, DISCOVERY MAY AID THE INQUIRY, SUMMARY JUDGMENT AWARD WAS PREMATURE (CT APP))/CIVIL PROCEDURE (SUMMARY JUDGMENT, INSUFFICIENT EVIDENCE OF HOW THE ACCIDENT OCCURRED IN THIS LABOR LAW 240 (1) ACTION, DISCOVERY MAY AID THE INQUIRY, SUMMARY JUDGMENT AWARD WAS PREMATURE (CT APP))/EVIDENCE (SUMMARY JUDGMENT, LABOR LAW-CONSTRUCTION LAW, INSUFFICIENT EVIDENCE OF HOW THE ACCIDENT OCCURRED IN THIS LABOR LAW 240 (1) ACTION, DISCOVERY MAY AID THE INQUIRY, SUMMARY JUDGMENT AWARD WAS PREMATURE (CT APP))/CIVIL PROCEDURE (SUMMARY JUDGMENT, INSUFFICIENT EVIDENCE OF HOW THE ACCIDENT OCCURRED IN THIS LABOR LAW 240 (1) ACTION, DISCOVERY MAY AID THE INQUIRY, SUMMARY JUDGMENT AWARD WAS PREMATURE (CT APP))/SUMMARY JUDGMENT (LABOR LAW-CONSTRUCTION LAW, EVIDENCE, INSUFFICIENT EVIDENCE OF HOW THE ACCIDENT OCCURRED IN THIS LABOR LAW 240 (1) ACTION, DISCOVERY MAY AID THE INQUIRY, SUMMARY JUDGMENT AWARD WAS PREMATURE (CT APP))/DISCOVERY (LABOR LAW-CONSTRUCTION LAW, SUMMARY JUDGMENT, INSUFFICIENT EVIDENCE OF HOW THE ACCIDENT OCCURRED IN THIS LABOR LAW 240 (1) ACTION, DISCOVERY MAY AID THE INQUIRY, SUMMARY JUDGMENT AWARD WAS PREMATURE (CT APP))

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DOCUMENTARY EVIDENCE DID NOT UTTERLY REFUTE PLAINTIFF’S CORRESPONDENCE-EVIDENCE THAT AN EMPLOYMENT CONTRACT HAD BEEN ENTERED AND BREACHED BY THE DEFENDANT, DEFENDANT’S MOTION TO DISMISS PROPERLY DENIED (CT APP).

The Court of Appeals, in a full-fledged opinion by Judge Stein, determined that an exchange of correspondence supported plaintiff’s allegation of the existence of an employment contract and a breach of that contract. The documentary evidence submitted by the defendant did not utterly refute the allegations in the complaint. Therefore the defendant’s motion to dismiss was properly denied:

… [W]e conclude that, based on all the documentary evidence proffered by defendant, a reasonable fact-finder could determine that a binding contract was formed. Ertel’s [the CEO’S] initial email to plaintiff stated that “[t]he terms of our offer are the same [as the] terms of your existing contract” — apart from “a clarification” concerning an issue that plaintiff characterizes as minor — and outlined the core terms that were included in the 2009 Agreement. He added that, if plaintiff had “[a]ny further questions” he should consult his “existing contract.” Inasmuch as this email explained that “the terms of the offer” were to be nearly identical to the terms of plaintiff’s existing contract, a reasonable fact-finder could interpret it as evincing an objective manifestation of defendant’s intent to enter into a bargain, such that plaintiff was justified “in understanding that his assent to that bargain [was] invited and [would] conclude it”… . Put differently, it could reasonably be inferred that Ertel’s email constituted a valid offer by defendant. In response to that email, plaintiff wrote “I accept. pls [sic] send contract,” to which Ertel replied, “Mazel. Looking forward to another great run.”… Affording plaintiff the benefit of every favorable inference, this exchange — in essence, we “offer” and “I accept,” followed by an arguably congratulatory exclamation, coupled with a forward-looking statement about the next stage of the parties’ continuing relationship — sufficiently evinces an objective manifestation of an intent to be bound for purposes of surviving a motion to dismiss … . Although Ertel’s email referenced one outstanding “clarification,” the parties’ further communications indicate that such clarification was incorporated into the first draft of the new agreement sent by Zeliger [general counsel] to plaintiff, and no evidence was offered to suggest that plaintiff resisted that change to the terms of the 2009 Agreement. We reject defendant’s argument that plaintiff’s contract claim should have been dismissed because the additional correspondence defendant proffered in support of its motion to dismiss reflects a lack of mutual assent to material terms — such as plaintiff’s minimum guaranteed compensation and the length of the non-compete term — and that this indefiniteness renders the purported contract invalid as a matter of law. As the Appellate Division concluded, that correspondence does not conclusively refute contract formation … . Kolchins v Evolution Mkts., Inc., 2018 NY Slip Op 02209, CtApp 3-29-18

CONTRACT LAW (CORRESPONDENCE, DOCUMENTARY EVIDENCE DID NOT UTTERLY REFUTE PLAINTIFF’S CORRESPONDENCE-EVIDENCE THAT AN EMPLOYMENT CONTRACT HAD BEEN ENTERED AND BREACHED BY THE DEFENDANT, DEFENDANT’S MOTION TO DISMISS PROPERLY DENIED (CT APP))/EMPLOYMENT LAW (CONTRACT LAW, DOCUMENTARY EVIDENCE DID NOT UTTERLY REFUTE PLAINTIFF’S CORRESPONDENCE-EVIDENCE THAT AN EMPLOYMENT CONTRACT HAD BEEN ENTERED AND BREACHED BY THE DEFENDANT, DEFENDANT’S MOTION TO DISMISS PROPERLY DENIED (CT APP))/CIVIL PROCEDURE (MOTION TO DISMISS, DOCUMENTARY EVIDENCE DID NOT UTTERLY REFUTE PLAINTIFF’S CORRESPONDENCE-EVIDENCE THAT AN EMPLOYMENT CONTRACT HAD BEEN ENTERED AND BREACHED BY THE DEFENDANT, DEFENDANT’S MOTION TO DISMISS PROPERLY DENIED (CT APP))/CPLR 3211 (DOCUMENTARY EVIDENCE DID NOT UTTERLY REFUTE PLAINTIFF’S CORRESPONDENCE-EVIDENCE THAT AN EMPLOYMENT CONTRACT HAD BEEN ENTERED AND BREACHED BY THE DEFENDANT, DEFENDANT’S MOTION TO DISMISS PROPERLY DENIED (CT APP))/CORRESPONDENCE (CONTRACT LAW,  DOCUMENTARY EVIDENCE DID NOT UTTERLY REFUTE PLAINTIFF’S CORRESPONDENCE-EVIDENCE THAT AN EMPLOYMENT CONTRACT HAD BEEN ENTERED AND BREACHED BY THE DEFENDANT, DEFENDANT’S MOTION TO DISMISS PROPERLY DENIED (CT APP))/EMAILS (CONTRACT LAW,  DOCUMENTARY EVIDENCE DID NOT UTTERLY REFUTE PLAINTIFF’S CORRESPONDENCE-EVIDENCE THAT AN EMPLOYMENT CONTRACT HAD BEEN ENTERED AND BREACHED BY THE DEFENDANT, DEFENDANT’S MOTION TO DISMISS PROPERLY DENIED (CT APP))/LETTERS (CONTRACT LAW,  DOCUMENTARY EVIDENCE DID NOT UTTERLY REFUTE PLAINTIFF’S CORRESPONDENCE-EVIDENCE THAT AN EMPLOYMENT CONTRACT HAD BEEN ENTERED AND BREACHED BY THE DEFENDANT, DEFENDANT’S MOTION TO DISMISS PROPERLY DENIED (CT APP))

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HOMEOWNER WAIVED THE DEFENSE OF LACK OF PERSONAL JURISDICTION, JUDGE SHOULD NOT HAVE, SUA SPONTE, DISMISSED THE FORECLOSURE ACTION ON THAT GROUND (SECOND DEPT).

The Second Department, reversing Supreme Court in this foreclosure proceeding, determined the homeowner had waived the defense of lack of personal jurisdiction and therefore the judge erred by, sua sponte, dismissing the complaint on that ground:

The Supreme Court erred in sua sponte raising and considering the defense of lack of personal jurisdiction. The homeowner waived this defense by failing to move to dismiss the complaint on this ground within 60 days of serving his answer … . As the homeowner waived this defense, it was error for the court, sua sponte, to direct dismissal of the complaint on this basis … .

Since, in the order appealed from, the plaintiff’s motion, inter alia, for summary judgment on the complaint and for an order of reference was, in effect, denied as academic in light of the Supreme Court’s directing dismissal of the complaint, we remit the matter to the Supreme Court, Queens County, for a determination of the plaintiff’s motion on the merits … . Wells Fargo Bank, N.A. v Cajas, 2018 NY Slip Op 02159, Second Dept 3-28-18

FORECLOSURE (HOMEOWNER WAIVED THE DEFENSE OF LACK OF PERSONAL JURISDICTION, JUDGE SHOULD NOT HAVE, SUA SPONTE, DISMISSED THE FORECLOSURE ACTION ON THAT GROUND (SECOND DEPT))/CIVIL PROCEDURE (DEFENSE OF LACK OF PERSONAL JURISDICTION, FORECLOSURE, HOMEOWNER WAIVED THE DEFENSE OF LACK OF PERSONAL JURISDICTION, JUDGE SHOULD NOT HAVE, SUA SPONTE, DISMISSED THE FORECLOSURE ACTION ON THAT GROUND (SECOND DEPT))/JURISDICTION, LACK OF PERSONAL (JUDGES, FORECLOSURE, HOMEOWNER WAIVED THE DEFENSE OF LACK OF PERSONAL JURISDICTION, JUDGE SHOULD NOT HAVE, SUA SPONTE, DISMISSED THE FORECLOSURE ACTION ON THAT GROUND (SECOND DEPT))/JUDGES (SUA SPONTE DISMISSAL, FORECLOSURE, HOMEOWNER WAIVED THE DEFENSE OF LACK OF PERSONAL JURISDICTION, JUDGE SHOULD NOT HAVE, SUA SPONTE, DISMISSED THE FORECLOSURE ACTION ON THAT GROUND (SECOND DEPT))/SUA SPONTE (LACK OF PERSONAL JURISDICTION, FORECLOSURE, HOMEOWNER WAIVED THE DEFENSE OF LACK OF PERSONAL JURISDICTION, JUDGE SHOULD NOT HAVE, SUA SPONTE, DISMISSED THE FORECLOSURE ACTION ON THAT GROUND (SECOND DEPT))

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PLAINTIFF’S TWICE FILING FOR BANKRUPTCY TOLLED THE STATUTE OF LIMITATIONS FOR OVER FOUR YEARS, FORECLOSURE ACTION WAS THEREFORE TIMELY (SECOND DEPT).

The Second Department determined plaintiff’s twice filing for bankruptcy tolled the statute of limitations for the foreclosure action, making the foreclosure action timely. Therefore, the bank’s motion to dismiss plaintiff’s Real Property Actions and Proceedings Law (RPAPL) 1501 action to cancel and discharge the mortgage was properly granted:

Section 362 of the 1978 Bankruptcy Code (11 USC) provides that the filing of a petition in bankruptcy “operates as a stay, applicable to all entities, of . . . the commencement or continuation . . . of a judicial, administrative, or other action or proceeding against the debtor that was or could have been commenced before the commencement of the case under this title” … . The filing of a petition for protection under the Bankruptcy Code imposes “an automatic stay of any mortgage foreclosure actions” … . CPLR 204(a) provides that “[w]here the commencement of an action has been stayed . . . by statutory prohibition, the duration of the stay is not a part of the time within which the action must be commenced.” Pursuant to CPLR 204(a), the Bankruptcy Code’s automatic stay tolls the limitations period for foreclosure actions … .

Here, in support of its motion to dismiss pursuant to CPLR 3211(a)(7), U.S. Bank submitted copies of the plaintiff’s petitions filed in the Bankruptcy Court, together with copies of the orders dismissing the first bankruptcy proceeding and releasing the subject property from the bankruptcy estate in the second bankruptcy proceeding, thereby establishing that, pursuant to CPLR 204(a), the statute of limitations had been tolled for over 4½ years. Lubonty v U.S. Bank N.A., 2018 NY Slip Op 02153, Second Dept 3-28-18

FORECLOSURE (PLAINTIFF’S TWICE FILING FOR BANKRUPTCY TOLLED THE STATUTE OF LIMITATIONS FOR OVER FOUR YEARS, FORECLOSURE ACTION WAS THEREFORE TIMELY (SECOND DEPT))/BANKRUPTCY (FORECLOSURE, PLAINTIFF’S TWICE FILING FOR BANKRUPTCY TOLLED THE STATUTE OF LIMITATIONS FOR OVER FOUR YEARS, FORECLOSURE ACTION WAS THEREFORE TIMELY (SECOND DEPT))/CIVIL PROCEDURE (STATUTE OF LIMITATIONS, FORECLOSURE, PLAINTIFF’S TWICE FILING FOR BANKRUPTCY TOLLED THE STATUTE OF LIMITATIONS FOR OVER FOUR YEARS, FORECLOSURE ACTION WAS THEREFORE TIMELY (SECOND DEPT))/STATUTE OF LIMITATIONS (FORECLOSURE, BANKRUPTCY, PLAINTIFF’S TWICE FILING FOR BANKRUPTCY TOLLED THE STATUTE OF LIMITATIONS FOR OVER FOUR YEARS, FORECLOSURE ACTION WAS THEREFORE TIMELY (SECOND DEPT))/CPLR 204 (FORECLOSURE, BANKRUPTCY, PLAINTIFF’S TWICE FILING FOR BANKRUPTCY TOLLED THE STATUTE OF LIMITATIONS FOR OVER FOUR YEARS, FORECLOSURE ACTION WAS THEREFORE TIMELY (SECOND DEPT))/REAL PROPERTY ACTIONS AND PROCEEDINGS LAW (RPAPL) (FORECLOSURE, RPAPL 1501 ACTION TO CANCEL AND DISCHARGE MORTGAGE, PLAINTIFF’S TWICE FILING FOR BANKRUPTCY TOLLED THE STATUTE OF LIMITATIONS FOR OVER FOUR YEARS, FORECLOSURE ACTION WAS THEREFORE TIMELY (SECOND DEPT))

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ALTHOUGH THE STATUTE OF LIMITATIONS FOR THE FORECLOSURE ACTION WAS TOLLED WHEN THE BANKRUPTCY PROCEEDINGS WERE ACTIVE, IT WAS NOT TOLLED WHEN A TEMPORARY RESTRAINING ORDER PROHIBITING SALE OF THE PROPERTY WAS IN EFFECT, FORECLOSURE ACTION WAS THEREFORE TIME-BARRED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined that the statute of limitations for bringing a foreclosure action, although tolled when bankruptcy proceedings were active, was not tolled when a temporary restraining order prohibiting the sale of the property was in effect. Therefore the foreclosure action was time-barred:

Under CPLR 204(a), “[w]here the commencement of an action has been stayed by a court or by statutory prohibition, the duration of the stay is not a part of the time within which the action must be commenced” … . The bankruptcy stay of 11 USC § 362(c) operates under CPLR 204(a) to stay the commencement, or continuation, of a foreclosure action … . Thus, the periods during which bankruptcy stays were in effect were not part of the time counted in the calculation of the running of the statute of limitations … . Contrary to the plaintiff’s contention, however, the time during which the temporary restraining order was in effect when the [borrowers] moved to dismiss the first foreclosure action did not toll the running of the statute of limitations. That order prevented the plaintiff from selling the property at auction, but only in the context of the first foreclosure action. The temporary restraining order did not prevent the plaintiff from discontinuing the first foreclosure action and commencing a new action… . Thus, the plaintiff was not entitled under CPLR 204(a) to have the time during which the temporary restraining order was in effect excluded from the statute of limitations, and the total time elapsed from the acceleration of the mortgage debt until the second foreclosure action was commenced exceeded six years, even when the periods attributable to the bankruptcy stays are excluded. U.S. Bank N.A. v Joseph, 2018 NY Slip Op 02155, Second Dept 3-28-18

FORECLOSURE (STATUTE OF LIMITATIONS, ALTHOUGH THE STATUTE OF LIMITATIONS FOR THE FORECLOSURE ACTION WAS TOLLED WHEN THE BANKRUPTCY PROCEEDINGS WERE ACTIVE, IT WAS NOT TOLLED WHEN A TEMPORARY RESTRAINING ORDER PROHIBITING SALE OF THE PROPERTY WAS IN EFFECT, FORECLOSURE ACTION WAS THEREFORE TIME-BARRED (SECOND DEPT))/BANKRUPTCY (FORECLOSURE, STATUTE OF LIMITATIONS, ALTHOUGH THE STATUTE OF LIMITATIONS FOR THE FORECLOSURE ACTION WAS TOLLED WHEN THE BANKRUPTCY PROCEEDINGS WERE ACTIVE, IT WAS NOT TOLLED WHEN A TEMPORARY RESTRAINING ORDER PROHIBITING SALE OF THE PROPERTY WAS IN EFFECT, FORECLOSURE ACTION WAS THEREFORE TIME-BARRED (SECOND DEPT))/CIVIL PROCEDURE (STATUTE OF LIMITATIONS, FORECLOSURE, ALTHOUGH THE STATUTE OF LIMITATIONS FOR THE FORECLOSURE ACTION WAS TOLLED WHEN THE BANKRUPTCY PROCEEDINGS WERE ACTIVE, IT WAS NOT TOLLED WHEN A TEMPORARY RESTRAINING ORDER PROHIBITING SALE OF THE PROPERTY WAS IN EFFECT, FORECLOSURE ACTION WAS THEREFORE TIME-BARRED (SECOND DEPT))/CPLR 204 (STATUTE OF LIMITATIONS, FORECLOSURE, ALTHOUGH THE STATUTE OF LIMITATIONS FOR THE FORECLOSURE ACTION WAS TOLLED WHEN THE BANKRUPTCY PROCEEDINGS WERE ACTIVE, IT WAS NOT TOLLED WHEN A TEMPORARY RESTRAINING ORDER PROHIBITING SALE OF THE PROPERTY WAS IN EFFECT, FORECLOSURE ACTION WAS THEREFORE TIME-BARRED (SECOND DEPT))/STATUTE OF LIMITATIONS (FORECLOSURE, ALTHOUGH THE STATUTE OF LIMITATIONS FOR THE FORECLOSURE ACTION WAS TOLLED WHEN THE BANKRUPTCY PROCEEDINGS WERE ACTIVE, IT WAS NOT TOLLED WHEN A TEMPORARY RESTRAINING ORDER PROHIBITING SALE OF THE PROPERTY WAS IN EFFECT, FORECLOSURE ACTION WAS THEREFORE TIME-BARRED (SECOND DEPT))

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NUISANCE AND TRESPASS ACTIONS BASED UPON SURFACE WATER WERE NOT CONTINUING TORTS AND WERE THEREFORE TIME-BARRED, CRITERIA FOR CONTINUING TORTS IN THIS CONTEXT EXPLAINED (FOURTH DEPT).

The Fourth Department determined the nuisance and trespass actions based upon the alleged diversion of surface water were not continuing torts and were therefore time-barred:

Defendants established that the nuisance and trespass causes of action accrued, at the latest, in June 2010, which is when plaintiff received the information from the USACE [US Army Corps of Engineers] and the damage to its property was apparent … .

Plaintiff contends that, because the water flows continually onto its property, the torts are continuous in nature and, as a result, plaintiff’s causes of action for nuisance and trespass are not time-barred. We reject that contention. Courts will apply the continuing wrong doctrine in cases of ” nuisance or continuing trespass where the harm sustained by the complaining party is not exclusively traced to the day when the original objectionable act was committed’ “… . Here, plaintiff’s allegations establish that its damages may be traced to a specific, objectionable act, i.e., the implementation of the remedial plan. Where, as here, there is an original, objectionable act, “the accrual date does not change as a result of continuing consequential damages” … . EPK Props., LLC v PFOHL Bros. Landfill Site Steering Comm., 2018 NY Slip Op 02085, Fourth Dept 3-23-18

REAL PROPERTY LAW (NUISANCE AND TRESPASS ACTIONS BASED UPON SURFACE WATER WERE NOT CONTINUING TORTS AND WERE THEREFORE TIME-BARRED, CRITERIA FOR CONTINUING TORTS IN THIS CONTEXT EXPLAINED (FOURTH DEPT))/CIVIL PROCEDURE (STATUTE OF LIMITATIONS, CONTINUING TORTS, NUISANCE AND TRESPASS ACTIONS BASED UPON SURFACE WATER WERE NOT CONTINUING TORTS AND WERE THEREFORE TIME-BARRED, CRITERIA FOR CONTINUING TORTS IN THIS CONTEXT EXPLAINED (FOURTH DEPT))/STATUTE OF LIMITATIONS (CONTINUING TORTS, NUISANCE AND TRESPASS ACTIONS BASED UPON SURFACE WATER WERE NOT CONTINUING TORTS AND WERE THEREFORE TIME-BARRED, CRITERIA FOR CONTINUING TORTS IN THIS CONTEXT EXPLAINED (FOURTH DEPT))/NUISANCE (SURFACE WATER, CONTINUING TORTS, NUISANCE AND TRESPASS ACTIONS BASED UPON SURFACE WATER WERE NOT CONTINUING TORTS AND WERE THEREFORE TIME-BARRED, CRITERIA FOR CONTINUING TORTS IN THIS CONTEXT EXPLAINED (FOURTH DEPT))/TRESPASS (SURFACE WATER, CONTINUING TORTS, NUISANCE AND TRESPASS ACTIONS BASED UPON SURFACE WATER WERE NOT CONTINUING TORTS AND WERE THEREFORE TIME-BARRED, CRITERIA FOR CONTINUING TORTS IN THIS CONTEXT EXPLAINED (FOURTH DEPT))/SURFACE WATER (NUISANCE AND TRESPASS ACTIONS BASED UPON SURFACE WATER WERE NOT CONTINUING TORTS AND WERE THEREFORE TIME-BARRED, CRITERIA FOR CONTINUING TORTS IN THIS CONTEXT EXPLAINED (FOURTH DEPT))

, , ,

MEDICAL MALPRACTICE ACTION BASED UPON CANCER MISDIAGNOSIS PRIOR TO THE RELEVANT AMENDMENT OF THE STATUTE OF LIMITATIONS WAS TIME-BARRED, FRAUD-RELATED CAUSES OF ACTION BASED UPON THE MEDICAL MALPRACTICE REJECTED (FOURTH DEPT).

The Fourth Department, reversing Supreme Court, determined that plaintiff’s medical malpractice cause of action based upon a cancer misdiagnosis was time-barred. The misdiagnosis was made before the statute of limitations for cancer misdiagnosis was changed (it now runs from when the plaintiff knew or should have known of the misdiagnosis). The court rejected the attempt to extend the statute of limitations by asserting fraud-related causes of action based upon the malpractice and alleged concealment of the misdiagnosis:

Defendants … contend that plaintiff failed to state a cause of action for fraud or fraudulent concealment, and that they are not estopped from invoking the statute of limitations against plaintiff’s medical malpractice cause of action. We agree. “The elements of a cause of action for fraud in connection with charges of medical malpractice are knowledge on the part of the physician of the fact of his [or her] malpractice and of [the] patient’s injury in consequence thereof, coupled with a subsequent intentional, material misrepresentation by [the physician] to [the] patient known by [the physician] to be false at the time it was made, and on which the patient [justifiably] relied to his [or her] damage’ ” … . “The damages resulting from the fraud must be separate and distinct from those generated by the alleged malpractice” … . Additionally, “a defendant may be estopped to plead the [s]tatute of [l]imitations where [the] plaintiff was induced by fraud, misrepresentations or deception to refrain from filing a timely action”… . However, “without more, concealment by a physician or failure to disclose his [or her] own malpractice does not give rise to a cause of action in fraud or deceit separate and different from the customary malpractice action, thereby entitling the plaintiff to bring his [or her] action within the longer period limited for such claims” … . Forbes v Caris Life Sciences, Inc., 2018 NY Slip Op 02086, Fourth Dept 3-23-18

NEGLIGENCE (MEDICAL MALPRACTICE ACTION BASED UPON CANCER MISDIAGNOSIS PRIOR TO THE RELEVANT AMENDMENT OF THE STATUTE OF LIMITATIONS WAS TIME-BARRED, FRAUD-RELATED CAUSES OF ACTION BASED UPON THE MEDICAL MALPRACTICE REJECTED (FOURTH DEPT))/MEDICAL MALPRACTICE  (MEDICAL MALPRACTICE ACTION BASED UPON CANCER MISDIAGNOSIS PRIOR TO THE RELEVANT AMENDMENT OF THE STATUTE OF LIMITATIONS WAS TIME-BARRED, FRAUD-RELATED CAUSES OF ACTION BASED UPON THE MEDICAL MALPRACTICE REJECTED (FOURTH DEPT))/FRAUD (MEDICAL MALPRACTICE ACTION BASED UPON CANCER MISDIAGNOSIS PRIOR TO THE RELEVANT AMENDMENT OF THE STATUTE OF LIMITATIONS WAS TIME-BARRED, FRAUD-RELATED CAUSES OF ACTION BASED UPON THE MEDICAL MALPRACTICE REJECTED (FOURTH DEPT))/CIVIL PROCEDURE (STATUTE OF LIMITATIONS, MEDICAL MALPRACTICE ACTION BASED UPON CANCER MISDIAGNOSIS PRIOR TO THE RELEVANT AMENDMENT OF THE STATUTE OF LIMITATIONS WAS TIME-BARRED, FRAUD-RELATED CAUSES OF ACTION BASED UPON THE MEDICAL MALPRACTICE REJECTED (FOURTH DEPT))/STATUTE OF LIMITATIONS (CANCER MISDIAGNOSIS, MEDICAL MALPRACTICE ACTION BASED UPON CANCER MISDIAGNOSIS PRIOR TO THE RELEVANT AMENDMENT OF THE STATUTE OF LIMITATIONS WAS TIME-BARRED, FRAUD-RELATED CAUSES OF ACTION BASED UPON THE MEDICAL MALPRACTICE REJECTED (FOURTH DEPT))/CANCER MISDIAGNOSIS (STATUTE OF LIMITATIONS, MEDICAL MALPRACTICE ACTION BASED UPON CANCER MISDIAGNOSIS PRIOR TO THE RELEVANT AMENDMENT OF THE STATUTE OF LIMITATIONS WAS TIME-BARRED, FRAUD-RELATED CAUSES OF ACTION BASED UPON THE MEDICAL MALPRACTICE REJECTED (FOURTH DEPT))

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