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MOTION TO COMPEL ACCEPTANCE OF A LATE ANSWER SHOULD HAVE BEEN GRANTED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined defendant’s motion to compel plaintiff to accept an answer which was two days late should have been granted pursuant to CPLR 2004:

CPLR 2004 provides that, “[e]xcept where otherwise expressly prescribed by law, the court may extend the time fixed by any statute, rule or order for doing any act, upon such terms as may be just and upon good cause shown, whether the application for extension is made before or after the expiration of the time fixed.” Given the strong public policy favoring the resolution of cases on the merits, “the Supreme Court may compel a plaintiff to accept an untimely answer (see CPLR 2004, 3012[d]) where the record demonstrates that there was only a short delay in appearing or answering the complaint, that there was no willfulness on the part of the defendant, that there would be no prejudice to the plaintiff, and that a potentially meritorious defense exists”… . Here, in light of the defendant’s brief and unintentional delay in serving its answer, the lack of prejudice to the plaintiff, and the existence of a potentially meritorious defense, the Supreme Court improvidently exercised its discretion in denying the defendant’s motion pursuant to CPLR 2004 to compel the plaintiff to accept its late answer … . Baldwin Rte. 6, LLC v Bernad Creations, Ltd., 2018 NY Slip Op 01039, Second Dept 2-14-18

CIVIL PROCEDURE (MOTION TO COMPEL ACCEPTANCE OF A LATE ANSWER SHOULD HAVE BEEN GRANTED (SECOND DEPT))/ANSWER (CIVIL PROCEDURE, MOTION TO COMPEL ACCEPTANCE OF A LATE ANSWER SHOULD HAVE BEEN GRANTED (SECOND DEPT))/CPLR 2004 (MOTION TO COMPEL ACCEPTANCE OF A LATE ANSWER SHOULD HAVE BEEN GRANTED (SECOND DEPT))

NO SPECIAL RULES APPLY TO DISCOVERY OF FACEBOOK POSTS IN A PERSONAL INJURY ACTION, THE SCOPE OF DISCOVERY SHOULD BE BASED UPON RELEVANCE TO THE ACTION BALANCED AGAINST PRIVACY CONCERNS (CT APP).

The Court of Appeals, in a full-fledged opinion by Judge DiFiore, reversing the appellate division, clarified the standards to be applied to a defendant’s discovery request for Facebook posts in a personal injury case. Plaintiff was injured falling from defendant’s horse and alleged her cognitive and physical abilities were diminished significantly by her injuries. Plaintiff had posted pictures reflecting her lifestyle on her Facebook page, which was deactivated six months after the accident. Defendant sought plaintiff’s entire “private” Facebook account, arguing that photographs and written postings (showing her cognitive abilities) were material and necessary to the defense (CPLR 3101(a)). “Supreme Court granted the motion to compel to the limited extent of directing plaintiff to produce all photographs of herself privately posted on Facebook prior to the accident that she intends to introduce at trial, all photographs of herself privately posted on Facebook after the accident that do not depict nudity or romantic encounters, and an authorization for Facebook records showing each time plaintiff posted a private message after the accident and the number of characters or words in the messages. … [The appellate division] modified by limiting disclosure to photographs posted on Facebook that plaintiff intended to introduce at trial (whether pre- or post-accident) and eliminating the authorization permitting defendant to obtain data relating to post-accident messages …”. In reinstating Supreme Court’s order, the Court of Appeals held that no special rules apply to Facebook accounts and courts should allow discovery based upon relevance, balanced against privacy concerns:

… [C]ourts should first consider the nature of the event giving rise to the litigation and the injuries claimed, as well as any other information specific to the case, to assess whether relevant material is likely to be found on the Facebook account. Second, balancing the potential utility of the information sought against any specific “privacy” or other concerns raised by the account holder, the court should issue an order tailored to the particular controversy that identifies the types of materials that must be disclosed while avoiding disclosure of nonrelevant materials. In a personal injury case such as this it is appropriate to consider the nature of the underlying incident and the injuries claimed and to craft a rule for discovering information specific to each. …

With respect to the items Supreme Court ordered to be disclosed (the only portion of the discovery request we may consider), defendant more than met his threshold burden of showing that plaintiff’s Facebook account was reasonably likely to yield relevant evidence. At her deposition, plaintiff indicated that, during the period prior to the accident, she posted “a lot” of photographs showing her active lifestyle. Likewise, given plaintiff’s acknowledged tendency to post photographs representative of her activities on Facebook, there was a basis to infer that photographs she posted after the accident might be reflective of her post-accident activities and/or limitations. …

… [I]t was reasonably likely that the data revealing the timing and number of characters in posted messages would be relevant to plaintiffs’ claim that she suffered cognitive injuries that caused her to have difficulty writing and using the computer, particularly her claim that she is painstakingly slow in crafting messages. Forman v Henkin, 2018 NY Slip Op 01015, CtApp 2-13-18

CIVIL PROCEDURE (DISCOVERY, FACEBOOK, NO SPECIAL RULES APPLY TO DISCOVERY OF FACEBOOK POSTS IN A PERSONAL INJURY ACTION, THE SCOPE OF DISCOVERY SHOULD BE BASED UPON RELEVANCE TO THE ACTION BALANCED AGAINST PRIVACY CONCERNS (CT APP))/DISCOVERY (FACEBOOK,  NO SPECIAL RULES APPLY TO DISCOVERY OF FACEBOOK POSTS IN A PERSONAL INJURY ACTION, THE SCOPE OF DISCOVERY SHOULD BE BASED UPON RELEVANCE TO THE ACTION BALANCED AGAINST PRIVACY CONCERNS (CT APP))/FACEBOOK (DISCOVERY, NO SPECIAL RULES APPLY TO DISCOVERY OF FACEBOOK POSTS IN A PERSONAL INJURY ACTION, THE SCOPE OF DISCOVERY SHOULD BE BASED UPON RELEVANCE TO THE ACTION BALANCED AGAINST PRIVACY CONCERNS (CT APP))

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PLAINTIFF’S ASSERTION OF A NEW THEORY OF LIABILITY IN THE PAPERS ANSWERING DEFENDANT HOSPITAL’S MOTION FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN CONSIDERED, SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (FOURTH DEPT).

The Fourth Department, reversing Supreme Court, determined the hospital’s (Crouse Hospital’s) motion for summary judgment in this medical malpractice action should have been granted. The defendant doctor was not a hospital employee and no hospital employee was named in the complaint or bill of particulars. The plaintiff, in answering the hospital’s summary judgment motion, claimed for the first time that two nurses were negligent. That new theory of recovery could not defeat the motion:

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Following discovery, the hospital moved for summary judgment dismissing the complaint against it, contending that the physician defendant was not its employee and that the hospital therefore could not be held vicariously liable for his alleged negligence. In opposing the motion, plaintiff did not address the hospital’s contention with respect to the physician defendant’s employment status and instead argued for the first time that two of the hospital’s nurses were negligent and that the hospital was vicariously liable for their actions. In our view, that is a new theory of recovery and thus could not be used by plaintiff to defeat the hospital’s motion … . We note that plaintiff did not move to amend the bill of particulars to allege that the hospital was vicariously liable for the nurses’ negligence. Inasmuch as plaintiff did not dispute that the hospital was not vicariously liable for the alleged negligence of the physician defendant, there was no basis to deny the motion, which we now grant. DeMartino v Kronhaus, 2018 NY Slip Op 00974, Fourth Dept 2-9-18

NEGLIGENCE (MEDICAL MALPRACTICE, PLAINTIFF’S ASSERTION OF A NEW THEORY OF LIABILITY IN THE PAPERS ANSWERING DEFENDANT HOSPITAL’S MOTION FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN CONSIDERED, SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (FOURTH DEPT))/MEDICAL MALPRACTICE (CIVIL PROCEDURE, PLAINTIFF’S ASSERTION OF A NEW THEORY OF LIABILITY IN THE PAPERS ANSWERING DEFENDANT HOSPITAL’S MOTION FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN CONSIDERED, SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (FOURTH DEPT))/CIVIL PROCEDURE (MEDICAL MALPRACTICE,  PLAINTIFF’S ASSERTION OF A NEW THEORY OF LIABILITY IN THE PAPERS ANSWERING DEFENDANT HOSPITAL’S MOTION FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN CONSIDERED, SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (FOURTH DEPT))/SUMMARY JUDGMENT (ANSWERING PAPERS,  PLAINTIFF’S ASSERTION OF A NEW THEORY OF LIABILITY IN THE PAPERS ANSWERING DEFENDANT HOSPITAL’S MOTION FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN CONSIDERED, SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (FOURTH DEPT))

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FAMILY COURT SHOULD NOT HAVE REFUSED TO ALLOW A SETTLEMENT OF THIS CHILD SUPPORT PROCEEDING, MOTHER AGREED FATHER’S JAIL SENTENCE SHOULD BE SUSPENDED IN RETURN FOR FATHER’S AGREEMENT TO PAY (FOURTH DEPT).

The Fourth Department, reversing Family Court, determined Family Court should not have refused to allow a settlement of this child support proceeding by stipulation. The court had directed that father be jailed for six months for failure to pay child support. Mother agreed that the jail sentence should be suspended in return for immediate payment of $3000 and future payments father could make because of a construction job he had just started:

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We agree with the father that the court erred in refusing to allow the parties to enter into the settlement agreement … . “Stipulations of settlement are favored by the courts and not lightly cast aside” … . “As a general matter, open court stipulations are especially favored by the courts inasmuch as they promote efficient dispute resolution, timely management of court calendars, and the integrity of the litigation process’ ” …  Under the circumstances of this case, we conclude that the court erred in refusing to allow the parties to settle the matter, and we therefore reverse the order and remit the matter to Family Court for further proceedings. If the parties no longer wish to settle, we direct the court to hold a new confirmation hearing. Matter of Soldato v Feketa, 2018 NY Slip Op 00989, Fourth Dept 2-9-18

FAMILY LAW (CHILD SUPPORT, FAMILY COURT SHOULD NOT HAVE REFUSED TO ALLOW A SETTLEMENT OF THIS CHILD SUPPORT PROCEEDING, MOTHER AGREED FATHER’S JAIL SENTENCE SHOULD BE SUSPENDED IN RETURN FOR FATHER’S AGREEMENT TO PAY (FOURTH DEPT))/CHILD SUPPORT (STIPULATION, FAMILY COURT SHOULD NOT HAVE REFUSED TO ALLOW A SETTLEMENT OF THIS CHILD SUPPORT PROCEEDING, MOTHER AGREED FATHER’S JAIL SENTENCE SHOULD BE SUSPENDED IN RETURN FOR FATHER’S AGREEMENT TO PAY (FOURTH DEPT))/CIVIL PROCEDURE (FAMILY COURT, STIPULATION, CHILD SUPPORT, FAMILY COURT SHOULD NOT HAVE REFUSED TO ALLOW A SETTLEMENT OF THIS CHILD SUPPORT PROCEEDING, MOTHER AGREED FATHER’S JAIL SENTENCE SHOULD BE SUSPENDED IN RETURN FOR FATHER’S AGREEMENT TO PAY (FOURTH DEPT))/STIPULATION (FAMILY COURT, CHILD SUPPORT, FAMILY COURT SHOULD NOT HAVE REFUSED TO ALLOW A SETTLEMENT OF THIS CHILD SUPPORT PROCEEDING, MOTHER AGREED FATHER’S JAIL SENTENCE SHOULD BE SUSPENDED IN RETURN FOR FATHER’S AGREEMENT TO PAY (FOURTH DEPT))/SETTLEMENT (FAMILY COURT, CHILD SUPPORT, STIPULATION, FAMILY COURT SHOULD NOT HAVE REFUSED TO ALLOW A SETTLEMENT OF THIS CHILD SUPPORT PROCEEDING, MOTHER AGREED FATHER’S JAIL SENTENCE SHOULD BE SUSPENDED IN RETURN FOR FATHER’S AGREEMENT TO PAY (FOURTH DEPT))

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NONPARTY, WHICH WISHED TO PURCHASE PROPERTY FOR USE AS A LAND FILL, PROPERLY ALLOWED TO INTERVENE IN A LAWSUIT BY THE PROPERTY OWNERS SEEKING TO DECLARE INVALID A LOCAL LAW WHICH PROHIBITED EXPANSION OF THE LAND FILL (FOURTH DEPT).

The Fourth Department determined a waste management company (Sealand), which had sought to purchase property for use as a land fill, was properly allowed to intervene in an action to determine the validity of a local law which prohibited expansion of the existing land fill:

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Upon a timely motion, a nonparty is permitted to intervene as of right in an action involving property where the nonparty “may be affected adversely by the judgment” … . Additionally, after considering “whether the intervention will unduly delay the determination of the action or prejudice the substantial rights of any party,” a court may, in its discretion, permit a nonparty to intervene when, inter alia, the nonparty’s “claim or defense and the main action have a common question of law or fact” … . “Whether intervention is sought as a matter of right under CPLR 1012 (a), or as a matter of discretion under CPLR 1013, is of little practical significance since a timely motion for leave to intervene should be granted, in either event, where the intervenor has a real and substantial interest in the outcome of the proceedings” … . * * *

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Here, although Sealand did not seek to intervene until several years after it knew its interests in the property may be implicated in the dispute, we conclude that the court did not abuse its discretion in granting the motion inasmuch as Sealand’s intervention will not delay resolution of the action and defendants will not suffer prejudice … . Sealand does not seek to assert any new claims or to conduct extensive additional discovery but rather, in essence, seeks only to continue the challenge to the 2007 Law on causes of action that remain unresolved despite lengthy litigation … . Where, as here, there is no “showing of prejudice resulting from delay in seeking intervention, the motion should not be denied as untimely” … . Jones v Town of Carroll, 2018 NY Slip Op 01010, Fourth Dept 2-9-18

ENVIRONMENTAL LAW (LAND FILL, CIVIL PROCEDURE, NONPARTY, WHICH WISHED TO PURCHASE PROPERTY FOR USE AS A LAND FILL, PROPERLY ALLOWED TO INTERVENE IN A LAWSUIT BY THE PROPERTY OWNERS SEEKING TO DECLARE INVALID A LOCAL LAW WHICH PROHIBITED EXPANSION OF THE LAND FILL (FOURTH DEPT))/CIVIL PROCEDURE (ENVIRONMENTAL LAW, LAND FILL, NONPARTY, WHICH WISHED TO PURCHASE PROPERTY FOR USE AS A LAND FILL, PROPERLY ALLOWED TO INTERVENE IN A LAWSUIT BY THE PROPERTY OWNERS SEEKING TO DECLARE INVALID A LOCAL LAW WHICH PROHIBITED EXPANSION OF THE LAND FILL (FOURTH DEPT))/LAND FILL (ENVIRONMENTAL LAW, CIVIL PROCEDURE, NONPARTY, WHICH WISHED TO PURCHASE PROPERTY FOR USE AS A LAND FILL, PROPERLY ALLOWED TO INTERVENE IN A LAWSUIT BY THE PROPERTY OWNERS SEEKING TO DECLARE INVALID A LOCAL LAW WHICH PROHIBITED EXPANSION OF THE LAND FILL (FOURTH DEPT))/INTERVENE, MOTION TO  (ENVIRONMENTAL LAW, CIVIL PROCEDURE, NONPARTY, WHICH WISHED TO PURCHASE PROPERTY FOR USE AS A LAND FILL, PROPERLY ALLOWED TO INTERVENE IN A LAWSUIT BY THE PROPERTY OWNERS SEEKING TO DECLARE INVALID A LOCAL LAW WHICH PROHIBITED EXPANSION OF THE LAND FILL (FOURTH DEPT))/CPLR 1012, 1013 (MOTION TO INTERVENE, ENVIRONMENTAL LAW, LAND FILL, NONPARTY, WHICH WISHED TO PURCHASE PROPERTY FOR USE AS A LAND FILL, PROPERLY ALLOWED TO INTERVENE IN A LAWSUIT BY THE PROPERTY OWNERS SEEKING TO DECLARE INVALID A LOCAL LAW WHICH PROHIBITED EXPANSION OF THE LAND FILL (FOURTH DEPT))

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PLAINTIFF CORPORATION’S FAILURE TO MAKE A REASONABLE EFFORT TO PRODUCE A FORMER EMPLOYEE FOR DEPOSITION BY DEFENDANT WARRANTED PRECLUDING PLAINTIFF FROM PRESENTING TESTIMONY BY THE FORMER EMPLOYEE PURSUANT TO CPLR 3126, HOWEVER PRECLUSION OF SECONDARY AND HEARSAY EVIDENCE RELATING TO THE FORMER EMPLOYEE, WHICH WOULD PRECLUDE PLAINTIFF FROM ASSERTING ITS CLAIM, WAS AN ABUSE OF DISCRETION (FOURTH DEPT).

The Fourth Department determined Supreme Court properly found that plaintiff corporation did not make sufficient efforts to produce a former employer to be deposed by defendant in this breach of contract action, and therefore properly precluded plaintiff from presenting the former employee’s testimony. However, the Fourth Department held that Supreme Court abused its discretion when it precluded any secondary or hearsay evidence related to the former employee, which would preclude plaintiff from asserting its claim:

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Generally, where there is no evidence that a corporation exercises control over a former employee, that corporation cannot be held responsible for the former employee’s refusal to appear for a deposition … . Here, however, the firm representing plaintiff undertook the representation of that former employee, implicitly conceding control over the former employee … . When the court ordered plaintiff’s attorney to make every reasonable effort to secure the former employee’s appearance for a deposition, plaintiff’s attorney merely sent a letter notifying the former employee that the attorney was supposed to make additional efforts to secure her presence. There is no evidence that any actual efforts to secure her appearance were made. We thus agree with the court that plaintiff should be precluded from presenting testimony from the former employee.

We conclude, however, that the court abused its discretion in precluding plaintiff from relying on any secondary or hearsay evidence related to the former employee. There was no order compelling the production of such evidence that plaintiff was alleged to have violated, and the court did not find a willful failure to disclose such evidence. Hypercel Corp. v Stampede Presentation Prods., Inc., 2018 NY Slip Op 00936, Fourth Dept 2-9-18

CIVIL PROCEDURE (EVIDENCE, PLAINTIFF’S FAILURE TO MAKE A REASONABLE EFFORT TO PRODUCE A FORMER EMPLOYEE FOR DEPOSITION BY DEFENDANT WARRANTED PRECLUDING PLAINTIFF FROM PRESENTING TESTIMONY BY THE FORMER EMPLOYEE, HOWEVER PRECLUSION OF SECONDARY AND HEARSAY EVIDENCE RELATING TO THE FORMER EMPLOYEE, WHICH WOULD PRECLUDE PLAINTIFF FROM ASSERTING ITS CLAIM, WAS AN ABUSE OF DISCRETION (FOURTH DEPT))/EVIDENCE (CIVIL PROCEDURE,  PLAINTIFF’S FAILURE TO MAKE A REASONABLE EFFORT TO PRODUCE A FORMER EMPLOYEE FOR DEPOSITION BY DEFENDANT WARRANTED PRECLUDING PLAINTIFF FROM PRESENTING TESTIMONY BY THE FORMER EMPLOYEE, HOWEVER PRECLUSION OF SECONDARY AND HEARSAY EVIDENCE RELATING TO THE FORMER EMPLOYEE, WHICH WOULD PRECLUDE PLAINTIFF FROM ASSERTING ITS CLAIM, WAS AN ABUSE OF DISCRETION (FOURTH DEPT))/CPLR 3126 EVIDENCE, PLAINTIFF’S FAILURE TO MAKE A REASONABLE EFFORT TO PRODUCE A FORMER EMPLOYEE FOR DEPOSITION BY DEFENDANT WARRANTED PRECLUDING PLAINTIFF FROM PRESENTING TESTIMONY BY THE FORMER EMPLOYEE, HOWEVER PRECLUSION OF SECONDARY AND HEARSAY EVIDENCE RELATING TO THE FORMER EMPLOYEE, WHICH WOULD PRECLUDE PLAINTIFF FROM ASSERTING ITS CLAIM, WAS AN ABUSE OF DISCRETION (FOURTH DEPT))/CORPORATION LAW (CIVIL PROCEDURE, EVIDENCE, PLAINTIFF’S FAILURE TO MAKE A REASONABLE EFFORT TO PRODUCE A FORMER EMPLOYEE FOR DEPOSITION BY DEFENDANT WARRANTED PRECLUDING PLAINTIFF FROM PRESENTING TESTIMONY BY THE FORMER EMPLOYEE, HOWEVER PRECLUSION OF SECONDARY AND HEARSAY EVIDENCE RELATING TO THE FORMER EMPLOYEE, WHICH WOULD PRECLUDE PLAINTIFF FROM ASSERTING ITS CLAIM, WAS AN ABUSE OF DISCRETION (FOURTH DEPT))

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OHIO GUN DEALER WHO SOLD GUN USED TO SHOOT PLAINTIFF IN NEW YORK DID NOT HAVE THE REQUISITE MINIMUM CONTACTS WITH NEW YORK, EXERCISING JURISDICTION OVER THE OHIO GUN DEALER, THEREFORE, WOULD VIOLATE DUE PROCESS (FOURTH DEPT).

The Fourth Department, in a full-fledged opinion by Justice Peradotto, reversing Supreme Court, determined New York courts could not exercise jurisdiction over an Ohio gun dealer, Brown, who, in Ohio, sold a handgun to an illegal gun trafficker from New York (Bostic). The handgun was ultimately used in New York to shoot the plaintiff. The Fourth Department, applying a federal due process “minimum contacts” analysis, concluded that to exercise jurisdiction over Brown would violate due process:

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… CPLR 302 (a) (3) (ii) requires an evaluation of whether Brown “expect[ed] or should reasonably [have] expect[ed his] act[s] to have consequences in [New York].” … * * *

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… [W]e conclude that Brown lacks the minimum contacts with New York that are a prerequisite to the exercise of jurisdiction over him. Brown’s submissions established that Great Lakes was an Ohio retailer permitted to sell guns within Ohio only and, during the relevant period from 1996 to 2005, it did not maintain a website, had no business telephone listing, did not advertise in New York, and made its retail sales and transfers to customers present in Ohio … . The evidence submitted by plaintiffs in opposition does not tend to establish that Brown “purposefully reach[ed] out beyond’ ” Ohio and into New York … . Brown did not, for example, engage in a purposeful distribution arrangement thereby evincing an effort to serve the market for firearms in New York … .

… Brown’s knowledge that guns sold to Bostic might end up being resold in New York if Bostic’s ostensible plan or hope came to fruition in the future is insufficient to establish the requisite minimum contacts with New York because such circumstances demonstrate, at most, Brown’s awareness of the mere possibility that the guns could be transported to and resold in New York … . Williams v Beemiller, Inc., 2018 NY Slip Op 00939, Fourth Dept 2-9-18

CIVIL PROCEDURE (LONG ARM JURISDICTION, OHIO GUN DEALER WHO SOLD GUN USED TO SHOOT PLAINTIFF IN NEW YORK DID NOT HAVE THE REQUISITE MINIMUM CONTACTS WITH NEW YORK, EXERCISING JURISDICTION OVER THE OHIO GUN DEALER, THEREFORE, WOULD VIOLATE DUE PROCESS (FOURTH DEPT))/CONSTITUTIONAL LAW (LONG ARM JURISDICTION, DUE PROCESS, OHIO GUN DEALER WHO SOLD GUN USED TO SHOOT PLAINTIFF IN NEW YORK DID NOT HAVE THE REQUISITE MINIMUM CONTACTS WITH NEW YORK, EXERCISING JURISDICTION OVER THE OHIO GUN DEALER, THEREFORE, WOULD VIOLATE DUE PROCESS (FOURTH DEPT))/DUE PROCESS (LONG ARM JURISDICTION, MINIMUM CONTACTS, OHIO GUN DEALER WHO SOLD GUN USED TO SHOOT PLAINTIFF IN NEW YORK DID NOT HAVE THE REQUISITE MINIMUM CONTACTS WITH NEW YORK, EXERCISING JURISDICTION OVER THE OHIO GUN DEALER, THEREFORE, WOULD VIOLATE DUE PROCESS (FOURTH DEPT))/MINIMUM CONTACTS  (LONG ARM JURISDICTION, OHIO GUN DEALER WHO SOLD GUN USED TO SHOOT PLAINTIFF IN NEW YORK DID NOT HAVE THE REQUISITE MINIMUM CONTACTS WITH NEW YORK, EXERCISING JURISDICTION OVER THE OHIO GUN DEALER, THEREFORE, WOULD VIOLATE DUE PROCESS (FOURTH DEPT))/LONG ARM JURISDICTION (MINIMUM CONTACTS,  OHIO GUN DEALER WHO SOLD GUN USED TO SHOOT PLAINTIFF IN NEW YORK DID NOT HAVE THE REQUISITE MINIMUM CONTACTS WITH NEW YORK, EXERCISING JURISDICTION OVER THE OHIO GUN DEALER, THEREFORE, WOULD VIOLATE DUE PROCESS (FOURTH DEPT))/JURISDICTION, LONG ARM OHIO GUN DEALER WHO SOLD GUN USED TO SHOOT PLAINTIFF IN NEW YORK DID NOT HAVE THE REQUISITE MINIMUM CONTACTS WITH NEW YORK, EXERCISING JURISDICTION OVER THE OHIO GUN DEALER, THEREFORE, WOULD VIOLATE DUE PROCESS (FOURTH DEPT))/CPLR 302 (LONG ARM JURISDICTION, OHIO GUN DEALER WHO SOLD GUN USED TO SHOOT PLAINTIFF IN NEW YORK DID NOT HAVE THE REQUISITE MINIMUM CONTACTS WITH NEW YORK, EXERCISING JURISDICTION OVER THE OHIO GUN DEALER, THEREFORE, WOULD VIOLATE DUE PROCESS (FOURTH DEPT))

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PLAINTIFF ALLEGED CONTINUING BREACHES OF CONTRACT, AIDING AND ABETTING FRAUD, NEGLIGENT MISREPRESENTATION AND AIDING AND ABETTING BREACH OF FIDUCIARY DUTY FOR THE DURATION OF THE DEBT-RIDDEN WORKERS’ COMPENSATION TRUST, WHICH WAS TERMINATED 25 DAYS BEFORE THE EXPIRATION OF THE SIX YEAR STATUTE OF LIMITATIONS, THOSE CAUSES OF ACTION SHOULD NOT HAVE BEEN DISMISSED (THIRD DEPT).

The Third Department, modifying Supreme Court, determined the causes of action for breach of contract, aiding and abetting fraud and negligent misrepresentation, and aiding and abetting a breach of fiduciary duty should not have been dismissed as time barred. The underlying suit is based on the allegation that defendant insurance broker was on the board of a Workers’ Compensation trust, which plaintiff had joined, and which was $82 million in debt. The Third Department held that the six-year statute of limitations applied to all the (above-described) causes of action and the complaint alleged continuing breaches throughout the period of membership in the trust, which terminated 25 days before the expiration of the statute of limitations (i.e., the six-year period before the suit was brought extended back to March 24, 2008, and the trust was terminated on April 17, 2008):

… [T]he amended complaint alleges continuing contractual obligations on the part of defendant and specifies that the various acts and omissions constituting the breaches occurred “[t]hroughout the entire course of [p]laintiff’s membership in the [t]rust.” Deeming these allegations as true and according them every favorable inference, as we must … , we conclude that defendant failed to make the requisite prima facie showing that plaintiff’s breach of contract claim is time-barred in its entirety … . …

[P]laintiff’s causes of action for negligent misrepresentation and aiding and abetting fraud are timely insofar as they allege conduct occurring [during the 25 day window]. …

… [W]e disagree with Supreme Court’s conclusion that the entirety of plaintiff’s aiding and abetting breach of fiduciary duty claim is governed by a three-year statute of limitations. Because plaintiff does not seek equitable relief, a six-year statute of limitations period applies to a breach of fiduciary duty cause of action if “an allegation of fraud is essential to” such claim … . While a claim of fraud generally requires an affirmative misrepresentation, “fraud may also result from a fiduciary’s failure to disclose material facts when the fiduciary had a duty to disclose and acted with the intent to deceive” … . Krog Corp. v Vanner Group, Inc., 2018 NY Slip Op 00876, Third Dept 2-8-18

 

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PLAINTIFF DID NOT DEMONSTRATE ANY BASIS FOR IN PERSONAM OR IN REM JURISDICTION BY THE NEW YORK COURTS, PROCEEDING TO ENFORCE AN ALBANIAN MONEY JUDGMENT PURSUANT TO ARTICLE 53 OF THE CPLR SHOULD HAVE BEEN DISMISSED (FIRST DEPT).

The First Department, in an extensive full-fledged opinion by Justice Friedman, reversing Supreme Court, determined New York courts did not have jurisdiction to enforce an Albanian judgment. The opinion is too detailed to fairly summarize here. The court explained the criteria for the enforcement of foreign money judgments under article 53 of the CPLR (Uniform Foreign Money-Judgments Recognition Act), and the applicability of Daimler AG v Bauman, 571 US ___, 134 S Ct 746 (2014) and Abu Dhabi Commercial Bank PJSC v Saad Trading, Contr. & Fin. Servs. Co.m 117 AD3d 609 (1st Dept 2014) to a CPLR article 53 proceeding. The plaintiff did not claim it had any basis for in personam or in rem jurisdiction in New York and relied upon the Abu Dhabi case for the argument such a jurisdictional demonstration was not required:

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To go beyond Abu Dhabi and hold, as [plaintiff] urges, that no jurisdictional nexus is ever required for a proceeding under article 53, even if the defendant asserts substantive defenses to recognition of the foreign judgment, would be a substantial departure from the prior general understanding of the law. For example, the Restatement (Third) of Foreign Relations Law takes the position that the creditor on a foreign country judgment “must establish a basis for the exercise of jurisdiction by the enforcing court over the judgment debtor or his property” (§ 481, Comment g). AlbaniaBEG Ambient Sh.p.k. v Enel S.p.A., 2018 NY Slip Op 00928, First Dept 2-8-18

CIVIL PROCEDURE (FOREIGN MONEY JUDGMENTS, PLAINTIFF DID NOT DEMONSTRATE ANY BASIS FOR IN PERSONAM OR IN REM JURISDICTION BY THE NEW YORK COURTS, PROCEEDING TO ENFORCE AN ALBANIAN MONEY JUDGMENT PURSUANT TO ARTICLE 53 OF THE CPLR SHOULD HAVE BEEN DISMISSED (FIRST DEPT))/DEBTOR-CREDITOR  (FOREIGN MONEY JUDGMENTS, PLAINTIFF DID NOT DEMONSTRATE ANY BASIS FOR IN PERSONAM OR IN REM JURISDICTION BY THE NEW YORK COURTS, PROCEEDING TO ENFORCE AN ALBANIAN MONEY JUDGMENT PURSUANT TO ARTICLE 53 OF THE CPLR SHOULD HAVE BEEN DISMISSED (FIRST DEPT))/CORPORATION LAW (FOREIGN MONEY JUDGMENTS, PLAINTIFF DID NOT DEMONSTRATE ANY BASIS FOR IN PERSONAM OR IN REM JURISDICTION BY THE NEW YORK COURTS, PROCEEDING TO ENFORCE AN ALBANIAN MONEY JUDGMENT PURSUANT TO ARTICLE 53 OF THE CPLR SHOULD HAVE BEEN DISMISSED (FIRST DEPT))/FOREIGN MONEY JUDGMENTS (PLAINTIFF DID NOT DEMONSTRATE ANY BASIS FOR IN PERSONAM OR IN REM JURISDICTION BY THE NEW YORK COURTS, PROCEEDING TO ENFORCE AN ALBANIAN MONEY JUDGMENT PURSUANT TO ARTICLE 53 OF THE CPLR SHOULD HAVE BEEN DISMISSED (FIRST DEPT))/JURISDICTION (CIVIL PROCEDURE, FOREIGN MONEY JUDGMENTS, PLAINTIFF DID NOT DEMONSTRATE ANY BASIS FOR IN PERSONAM OR IN REM JURISDICTION BY THE NEW YORK COURTS, PROCEEDING TO ENFORCE AN ALBANIAN MONEY JUDGMENT PURSUANT TO ARTICLE 53 OF THE CPLR SHOULD HAVE BEEN DISMISSED (FIRST DEPT))/CPLR ARTICLE 53  (FOREIGN MONEY JUDGMENTS, PLAINTIFF DID NOT DEMONSTRATE ANY BASIS FOR IN PERSONAM OR IN REM JURISDICTION BY THE NEW YORK COURTS, PROCEEDING TO ENFORCE AN ALBANIAN MONEY JUDGMENT PURSUANT TO ARTICLE 53 OF THE CPLR SHOULD HAVE BEEN DISMISSED (FIRST DEPT))

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OKAY FOR BANK TO SUBMIT RENEWED POWER OF ATTORNEY IN REPLY PAPERS, POWER OF ATTORNEY SUBMITTED WITH MOTION PAPERS HAD APPARENTLY EXPIRED AND DEFENDANTS RAISED THE ISSUE IN ANSWERING PAPERS (SECOND DEPT).

The Second Department determined Supreme Court properly considered the submission of a renewed power of attorney in reply papers in this foreclosure proceeding. Apparently the power of attorney submitted with the bank’s motion papers had expired:

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Contrary to the appellants’ contention, the Supreme Court properly considered a renewed power of attorney submitted by the plaintiff in reply to the appellants’ opposition to its motion. “The function of reply papers is to address arguments made in opposition to the position taken by the movant”… . Here, the renewed power of attorney submitted by the plaintiff was offered in response to the appellants’ argument made in opposition that the plaintiff’s affidavit of merit, signed by the assistant vice president of its servicing agent, was invalid because it was signed after the original power of attorney submitted by the plaintiff had expired. The renewed power of attorney merely clarified that the plaintiff’s servicing agent continued to have the authority to act on behalf of the plaintiff at the time the affidavit was signed … . Bank of N.Y. Mellon v Hoshmand, 2018 NY Slip Op 00818, Second Dept 2-7-18

CIVIL PROCEDURE (REPLY PAPERS, OKAY FOR BANK TO SUBMIT RENEWED POWER OF ATTORNEY IN REPLY PAPERS, POWER OF ATTORNEY SUBMITTED WITH MOTION PAPERS HAD APPARENTLY EXPIRED AND DEFENDANTS RAISED THE ISSUE IN ANSWERING PAPERS (SECOND DEPT))/REPLY PAPERS (CIVIL PROCEDURE, OKAY FOR BANK TO SUBMIT RENEWED POWER OF ATTORNEY IN REPLY PAPERS, POWER OF ATTORNEY SUBMITTED WITH MOTION PAPERS HAD APPARENTLY EXPIRED AND DEFENDANTS RAISED THE ISSUE IN ANSWERING PAPERS (SECOND DEPT))/FORECLOSURE (CIVIL PROCEDURE, REPLY PAPERS, OKAY FOR BANK TO SUBMIT RENEWED POWER OF ATTORNEY IN REPLY PAPERS, POWER OF ATTORNEY SUBMITTED WITH MOTION PAPERS HAD APPARENTLY EXPIRED AND DEFENDANTS RAISED THE ISSUE IN ANSWERING PAPERS (SECOND DEPT))

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