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WINNING A MOTION TO DISMISS DOES NOT TRIGGER THE AWARD OF ATTORNEY’S FEES UNDER CPLR 3220 (SECOND DEPT).

The Second Department determined the successful motion to dismiss a civil suit did not mandate the award of attorney’s fees under the CPLR:

… “[U]nder the American Rule as applied to statutory entitlement to attorneys’ fees, the [United States] Supreme Court has held that we follow a general practice of not awarding fees to a prevailing party absent explicit statutory authority”… . * * *

The relevant phrase of CPLR 3220 stating that the claimant “shall pay the expenses necessarily incurred by the party against whom the claim is asserted, for trying the issue of damages from the time of the offer” demonstrates the Legislature’s intent that, where the claimant has not accepted the offer, the commencement of a trial is a condition precedent to imposing liability upon the claimant for the opposing party’s expenses. This phrase also defines the recoverable expenses as those “necessarily” expended “for trying the issue of damages.” CPLR 3220 further provides that those expenses should be determined by the judge “before whom the case is tried.” Accordingly, the plain language of CPLR 3220 does not explicitly authorize an award of attorney’s fees and costs to a party … who merely prevailed in seeking dismissal of a cause of action alleging breach of contract. Even if CPLR 3220 could arguably support an implied right to the attorney’s fees and costs … , the public policy of the American Rule militates against adoption of that interpretation … . Saul v Cahan, 2017 NY Slip Op 06391, Second Dept 8-30-17

CIVIL PROCEDURE (WINNING A MOTION TO DISMISS DOES NOT TRIGGER THE AWARD OF ATTORNEY’S FEES UNDER CPLR 3220 (SECOND DEPT))/ATTORNEYS (FEES, CIVIL PROCEDURE, WINNING A MOTION TO DISMISS DOES NOT TRIGGER THE AWARD OF ATTORNEY’S FEES UNDER CPLR 3220 (SECOND DEPT))

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FURTHER DISCOVERY NECESSARY TO DETERMINE RELATIONSHIP BETWEEN SIGNATORIES AND NON-SIGNATORIES TO A CONTRACT WITH A FORUM SELECTION CLAUSE, IF THE RELATIONSHIP IS CLOSE ENOUGH, NON-SIGNATORIES WILL BE COVERED BY THE CLAUSE (FIRST DEPT).

The First Department, in a full-fledged opinion by Justice Kapnick, determined further jurisdictional discovery was required before certain causes of action could be dismissed on jurisdictional grounds. If the relationship with signatories of a contract with a forum selection clause is close enough, non-signatories will be covered by the clause. Discovery was necessary to determine how close the relationship was. The opinion is too detailed and complex to fully summarize here. The crux of the action is the alleged failure of the corporations to pay interest due on notes held by shareholders:

“Under New York law, a signatory to a contract may invoke a forum selection clause against a non-signatory if the non-signatory is closely related’ to one of the signatories such that enforcement of the forum selection clause is foreseeable by virtue of the relationship between the signatory and the party sought to be bound'” … . If the nonsignatory party has an ownership interest or a direct or indirect controlling interest in the signing party … , or, the entities or individuals consulted with each other regarding decisions and were intimately involved in the decision-making process… , then, a finding of personal jurisdiction based on a forum selection clause may be proper, as it achieves the “rationale behind binding closely related entities to the forum selection clause [which] is to promote stable and dependable trade relations.'” … .

Here, plaintiffs allege that the individual defendants, by virtue of their senior management positions, power and decision-making authority, and B & B, as the parent company of BTEL and as a principal shareholder of 39.6% of BTEL’s stock, had actual knowledge at the time of the offering that BTEL was insolvent and would be incapable of meeting its obligations under the notes; that they authorized, participated in, and promoted the offering; and that they caused the offering memoranda to be distributed into the marketplace. This is enough, at this stage, to permit jurisdictional discovery as to the nature of B & B’s and the individual defendants’ actual knowledge and role in the offering of the notes, and their responsibilities connected thereto, because this information, which may result in a determination that the nonsignatories are indeed “closely related” to the signing parties, is a fact that cannot be presently known to plaintiffs, but rather, is within the exclusive control of defendants …. . Universal Inv. Advisory SA v Bakrie Telecom PTE, Ltd., 2017 NY Slip Op 06344, First Dept 8-29-17

 

CIVIL PROCEDURE (JURISDICTION, DISCOVERY, FORUM SELECTION CLAUSE,  FURTHER DISCOVERY NECESSARY TO DETERMINE RELATIONSHIP BETWEEN SIGNATORIES AND NON-SIGNATORIES TO A CONTRACT WITH A FORUM SELECTION CLAUSE, IF THE RELATIONSHIP IS CLOSE ENOUGH, NON-SIGNATORIES WILL BE COVERED BY THE CLAUSE (FIRST DEPT))/JURISDICTION (DISCOVERY, FORUM SELECTION CLAUSE,  FURTHER DISCOVERY NECESSARY TO DETERMINE RELATIONSHIP BETWEEN SIGNATORIES AND NON-SIGNATORIES TO A CONTRACT WITH A FORUM SELECTION CLAUSE, IF THE RELATIONSHIP IS CLOSE ENOUGH, NON-SIGNATORIES WILL BE COVERED BY THE CLAUSE (FIRST DEPT))/DISCOVERY (CIVIL PROCEDURE, JURISDICTION,  FORUM SELECTION CLAUSE,  FURTHER DISCOVERY NECESSARY TO DETERMINE RELATIONSHIP BETWEEN SIGNATORIES AND NON-SIGNATORIES TO A CONTRACT WITH A FORUM SELECTION CLAUSE, IF THE RELATIONSHIP IS CLOSE ENOUGH, NON-SIGNATORIES WILL BE COVERED BY THE CLAUSE (FIRST DEPT))/CONTRACT LAW (FORUM SELECTION CLAUSE,  FURTHER DISCOVERY NECESSARY TO DETERMINE RELATIONSHIP BETWEEN SIGNATORIES AND NON-SIGNATORIES TO A CONTRACT WITH A FORUM SELECTION CLAUSE, IF THE RELATIONSHIP IS CLOSE ENOUGH, NON-SIGNATORIES WILL BE COVERED BY THE CLAUSE (FIRST DEPT))/FORUM SELECTION CLAUSE (CONTRACT LAW, (JURISDICTION, DISCOVERY, FORUM SELECTION CLAUSE,  FURTHER DISCOVERY NECESSARY TO DETERMINE RELATIONSHIP BETWEEN SIGNATORIES AND NON-SIGNATORIES TO A CONTRACT WITH A FORUM SELECTION CLAUSE, IF THE RELATIONSHIP IS CLOSE ENOUGH, NON-SIGNATORIES WILL BE COVERED BY THE CLAUSE (FIRST DEPT))/CORPORATION LAW (FORUM SELECTION CLAUSE, JURISDICTION, DISCOVERY, FORUM SELECTION CLAUSE,  FURTHER DISCOVERY NECESSARY TO DETERMINE RELATIONSHIP BETWEEN SIGNATORIES AND NON-SIGNATORIES TO A CONTRACT WITH A FORUM SELECTION CLAUSE, IF THE RELATIONSHIP IS CLOSE ENOUGH, NON-SIGNATORIES WILL BE COVERED BY THE CLAUSE (FIRST DEPT))

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SUPREME COURT SHOULD NOT HAVE RULED PLAINTIFF’S EXPERT WAS NOT QUALIFIED, EXPERT WAS QUALIFIED AND THE ISSUE WAS NOT RAISED BY THE PARTIES, QUESTION OF FACT WHETHER PLAINTIFF GAVE INFORMED CONSENT (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the dentist who provided an affidavit for plaintiff was an expert, the expert raised a question of fact whether defendant departed from the accepted standard of care, and a question of fact was raised about whether plaintiff gave informed consent to the procedure. The court noted that plaintiff’s expert’s qualifications were not questioned in defendant’s reply papers. Therefore, the court should not have raised the issue on its own and used the issue to support granting  summary judgment to the defendant. With regard to informed consent, the court wrote:

“A cause of action predicated on a lack of informed consent is meant to redress a failure of the person providing the professional treatment or diagnosis to disclose to the patient such alternatives thereto and the reasonably foreseeable risks and benefits involved as a reasonable medical . . . practitioner under similar circumstances would have disclosed, in a manner permitting the patient to make a knowledgeable evaluation”… .. To establish a cause of action to recover damages for malpractice based on lack of informed consent, a plaintiff must prove (1) that the person providing the professional treatment failed to disclose alternatives thereto and failed to inform the patient of reasonably foreseeable risks associated with the treatment, and the alternatives, that a reasonable medical practitioner would have disclosed in the same circumstances, (2) that a reasonably prudent patient in the same position would not have undergone the treatment if he or she had been fully informed, and (3) that the lack of informed consent is a proximate cause of the injury … .

Here, the defendant failed to submit proof sufficient to establish, prima facie, that he had informed the plaintiff of the reasonably foreseeable risks associated with the treatment, and, in any event, that a reasonably prudent patient in the same position would have undergone the treatment if he or she had been fully informed … . Dyckes v Stabile, 2017 NY Slip Op 06252, Second Dept 8-23-17

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NEGLIGENCE (DENTAL MALPRACTICE, SUPREME COURT SHOULD NOT HAVE RULED PLAINTIFF’S EXPERT WAS NOT QUALIFIED, EXPERT WAS QUALIFIED AND THE ISSUE WAS NOT RAISED BY THE PARTIES, QUESTION OF FACT WHETHER PLAINTIFF GAVE INFORMED CONSENT (SECOND DEPT))/MEDICAL MALPRACTICE (DENTAL MALPRACTICE, SUPREME COURT SHOULD NOT HAVE RULED PLAINTIFF’S EXPERT WAS NOT QUALIFIED, EXPERT WAS QUALIFIED AND THE ISSUE WAS NOT RAISED BY THE PARTIES, QUESTION OF FACT WHETHER PLAINTIFF GAVE INFORMED CONSENT (SECOND DEPT))/DENTAL MALPRACTICE (SUPREME COURT SHOULD NOT HAVE RULED PLAINTIFF’S EXPERT WAS NOT QUALIFIED, EXPERT WAS QUALIFIED AND THE ISSUE WAS NOT RAISED BY THE PARTIES, QUESTION OF FACT WHETHER PLAINTIFF GAVE INFORMED CONSENT (SECOND DEPT))/EXPERT OPINION  (DENTAL MALPRACTICE, SUPREME COURT SHOULD NOT HAVE RULED PLAINTIFF’S EXPERT WAS NOT QUALIFIED, EXPERT WAS QUALIFIED AND THE ISSUE WAS NOT RAISED BY THE PARTIES, QUESTION OF FACT WHETHER PLAINTIFF GAVE INFORMED CONSENT (SECOND DEPT))/INFORMED CONSENT (DENTAL MALPRACTICE, SUPREME COURT SHOULD NOT HAVE RULED PLAINTIFF’S EXPERT WAS NOT QUALIFIED, EXPERT WAS QUALIFIED AND THE ISSUE WAS NOT RAISED BY THE PARTIES, QUESTION OF FACT WHETHER PLAINTIFF GAVE INFORMED CONSENT (SECOND DEPT))/CIVIL PROCEDURE (ISSUES NOT RAISED BY THE PARTIES, DENTAL MALPRACTICE, SUPREME COURT SHOULD NOT HAVE RULED PLAINTIFF’S EXPERT WAS NOT QUALIFIED, EXPERT WAS QUALIFIED AND THE ISSUE WAS NOT RAISED BY THE PARTIES, QUESTION OF FACT WHETHER PLAINTIFF GAVE INFORMED CONSENT (SECOND DEPT))/SUMMARY JUDGMENT  (ISSUES NOT RAISED BY THE PARTIES, DENTAL MALPRACTICE, SUPREME COURT SHOULD NOT HAVE RULED PLAINTIFF’S EXPERT WAS NOT QUALIFIED, EXPERT WAS QUALIFIED AND THE ISSUE WAS NOT RAISED BY THE PARTIES, QUESTION OF FACT WHETHER PLAINTIFF GAVE INFORMED CONSENT (SECOND DEPT))/EVIDENCE  (DENTAL MALPRACTICE, SUPREME COURT SHOULD NOT HAVE RULED PLAINTIFF’S EXPERT WAS NOT QUALIFIED, EXPERT WAS QUALIFIED AND THE ISSUE WAS NOT RAISED BY THE PARTIES, QUESTION OF FACT WHETHER PLAINTIFF GAVE INFORMED CONSENT (SECOND DEPT))

CERTIFICATE OF READINESS WHICH INDICATED FURTHER DISCOVERY WAS NECESSARY RENDERED THE FILING OF THE NOTE OF ISSUE A NULLITY (SECOND DEPT).

The Second Department determined that the filing of note of issue accompanied by a certificate of readiness which indicated more discovery was required was a nullity:

Pursuant to Uniform Rules for Trial Courts (22 NYCRR) § 202.21, a note of issue must be accompanied by a certificate of readiness, which must state that there are no outstanding requests for discovery and the case is ready for trial … .

Here, the plaintiffs’ certificate of readiness stated, among other things, that discovery proceedings had not been completed, that there were outstanding requests for discovery, and that the case was not ready for trial. Since the certificate of readiness failed to materially comply with the requirements of 22 NYCRR 202.21, the filing of the note of issue was a nullity … . Rizzo v Balish & Friedman, 2017 NY Slip Op 06307, Second Dept 8-23-17

 

CIVIL PROCEDURE (CERTIFICATE OF READINESS WHICH INDICATED FURTHER DISCOVERY WAS NECESSARY RENDERED THE FILING OF THE NOTE OF ISSUE A NULLITY (SECOND DEPT))/CERTIFICATE OF READINESS (CERTIFICATE OF READINESS WHICH INDICATED FURTHER DISCOVERY WAS NECESSARY RENDERED THE FILING OF THE NOTE OF ISSUE A NULLITY (SECOND DEPT))/NOTE OF ISSUE  (CERTIFICATE OF READINESS WHICH INDICATED FURTHER DISCOVERY WAS NECESSARY RENDERED THE FILING OF THE NOTE OF ISSUE A NULLITY (SECOND DEPT))

CALIFORNIA STATUTE IS A PROCEDURAL STATUTE OF LIMITATIONS, NOT A SUBSTANTIVE STATUTE OF REPOSE, THEREFORE THE STATUTE WOULD NOT BE APPLIED IN A NEW YORK ACTION (SECOND DEPT).

The Second Department determined a California statute was a statute of limitations, not a statute of repose. A statute of limitations, unlike a statute of repose, is considered procedural in New York. Therefore the California statute would not be applied in a New York action. Because the California statute of limitations would not apply to the underlying New York action, the defendant-attorneys’ failure to raise the statute of limitations as a defense did not constitute malpractice:

“In New York, Statutes of Limitation are generally considered procedural because they are [v]iewed as pertaining to the remedy rather than the right” … . A statute of limitations “does not begin to run until a cause of action accrues” … . In contrast, “a statute of repose begins to run when the specified event or events takes place, regardless of whether a potential claim has accrued or, indeed, whether any injury has occurred” … . “The repose period serves as an absolute barrier that prevents a plaintiff’s right of action” … . “In other words, the period of repose has the effect of preventing what might otherwise have been a cause of action from ever arising” … . Statutes of repose “exhibit a substantive texture, nature and consequence that distinguishes them from ordinary limitation provisions” … . … [I]f a statute creates a cause of action and attaches a time limit to its commencement, the time is an ingredient of the cause” … . In contrast, when a cause of action “was cognizable at common law or by other statute law, a statutory time limit is commonly taken as one of limitations and must be asserted by way of defense” … . …

… California Code of Civil Procedure § 366.3 is a statute of limitations, not a statute of repose. Unlike a statute of repose, section 366.3 begins to run at the time the cause of action to recover on the promise to make a testamentary disposition accrues, namely, the date of the promisor’s death … . Nestor v Putney Twombly Hall & Hirson, LLP, 2017 NY Slip Op 06284, Second Dept 8-23-17

 

CIVIL PROCEDURE (CHOICE OF LAW, CALIFORNIA STATUTE IS A PROCEDURAL STATUTE OF LIMITATIONS, NOT A SUBSTANTIVE STATUTE OF REPOSE, THEREFORE THE STATUTE WOULD NOT BE APPLIED IN A NEW YORK ACTION (SECOND DEPT))/CHOICE OF LAW ( CALIFORNIA STATUTE IS A PROCEDURAL STATUTE OF LIMITATIONS, NOT A SUBSTANTIVE STATUTE OF REPOSE, THEREFORE THE STATUTE WOULD NOT BE APPLIED IN A NEW YORK ACTION (SECOND DEPT))/STATUTE OF LIMITATIONS  (CHOICE OF LAW, CALIFORNIA STATUTE IS A PROCEDURAL STATUTE OF LIMITATIONS, NOT A SUBSTANTIVE STATUTE OF REPOSE, THEREFORE THE STATUTE WOULD NOT BE APPLIED IN A NEW YORK ACTION (SECOND DEPT))/STATUTE OF REPOSE (CHOICE OF LAW, CALIFORNIA STATUTE IS A PROCEDURAL STATUTE OF LIMITATIONS, NOT A SUBSTANTIVE STATUTE OF REPOSE, THEREFORE THE STATUTE WOULD NOT BE APPLIED IN A NEW YORK ACTION (SECOND DEPT))

WHEN A PRELIMINARY INJUNCTION IS GRANTED THE PLAINTIFF MUST GIVE AN UNDERTAKING (SECOND DEPT).

The Second Department noted that when a court grants a preliminary injunction the plaintiff must give an undertaking:

A party seeking the drastic remedy of a preliminary injunction has the burden of demonstrating, by clear and convincing evidence, (1) a likelihood of ultimate success on the merits, (2) the prospect of irreparable injury if the provisional relief is withheld, and (3) a balancing of the equities in the movant’s favor … . The decision to grant or deny a preliminary injunction lies within the sound discretion of the Supreme Court … . Here, where the plaintiff established a likelihood of success on the merits and the irreparable harm it would suffer should the preliminary injunction not be granted, the equities tip in favor of the plaintiff and the court properly granted that branch of the plaintiff’s motion which sought a preliminary injunction … .

However, upon the granting of a preliminary injunction, a plaintiff “shall give an undertaking in an amount to be fixed by the court, that the plaintiff, if it is finally determined that he or she was not entitled to an injunction, will pay to the defendant all damages and costs which may be sustained by reason of the injunction” (CPLR 6312[b] … ). Mobstub, Inc. v www.staytrendy.com, 2017 NY Slip Op 06265, Second Dept 8-23-17

 

CIVIL PROCEDURE (WHEN A PRELIMINARY INJUNCTION IS GRANTED THE PLAINTIFF MUST GIVE AN UNDERTAKING (SECOND DEPT))/PRELIMINARY INJUNCTION (WHEN A PRELIMINARY INJUNCTION IS GRANTED THE PLAINTIFF MUST GIVE AN UNDERTAKING (SECOND DEPT))/UNDERTAKING (WHEN A PRELIMINARY INJUNCTION IS GRANTED THE PLAINTIFF MUST GIVE AN UNDERTAKING (SECOND DEPT))

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SEX AND DISABILITY EMPLOYMENT DISCRIMINATION COMPLAINT PROPERLY AMENDED UNDER THE RELATION BACK STATUTE WITH OTHERWISE UNTIMELY CAUSES OF ACTION ALLEGING SEXUAL ORIENTATION DISCRIMINATION (FIRST DEPT).

The First Department, in a full-fledged opinion by Justice Acosta, over an extensive two-justice dissent, determined the relation-back statute (CPLR 203 (f)) allowed the amendment of a sex-and-disability-discrimination complaint to allege otherwise untimely employment discrimination causes of action based upon plaintiff’s sexual orientation. The original sex-and-disability-discrimination complaint did not mention plaintiff was a lesbian and had suffered discrimination because of her sexual orientation. The First Department held that the wording of the relation-back statute, which refers to “transactions” or “occurrences,” not “claims,” allowed the amendment in the absence of prejudice:

All of plaintiff’s claims are based on the same occurrences — namely the underlying employment actions taken against her – and the original complaint put defendants on notice of those occurrences. To be sure, plaintiff’s original complaint did not allege the specific facts that she is a lesbian, that defendants were aware of her sexual orientation, that defendants discriminated against her on that basis, or that another lesbian colleague was demoted for supporting her internal dispute … . Nevertheless, the motion court correctly determined that the new claims are based on “the same subject matter alleged in the original complaint.” Defendants need not have been put on notice of every factual allegation on which the subsequent claims depend, because the original complaint put them on notice of the occurrences that underlie those claims … .

Viewing “transactions [or] occurrences” through this broad lens for the purposes of relation back under CPLR 203(f) is especially important in the context of anti-discrimination actions – particularly those actions brought under the City HRL [Human Rights Law] – in which it is frequently difficult for plaintiffs to articulate their employers’ motivations for treating them less well than other employees … . O’Halloran v Metropolitan Transp. Auth., 2017 NY Slip Op 06237, First Dept 8-22-17

 

EMPLOYMENT LAW (HUMAN RIGHTS LAW, SEX AND DISABILITY EMPLOYMENT DISCRIMINATION COMPLAINT PROPERLY AMENDED UNDER THE RELATION BACK STATUTE WITH OTHERWISE UNTIMELY CAUSES OF ACTION ALLEGING SEXUAL ORIENTATION DISCRIMINATION (FIRST DEPT))/HUMAN RIGHTS LAW (GENDER AND SEXUAL ORIENTATION DISCRIMINATION, SEX AND DISABILITY EMPLOYMENT DISCRIMINATION COMPLAINT PROPERLY AMENDED UNDER THE RELATION BACK STATUTE WITH OTHERWISE UNTIMELY CAUSES OF ACTION ALLEGING SEXUAL ORIENTATION DISCRIMINATION (FIRST DEPT))/GENDER DISCRIMINATION  (HUMAN RIGHTS LAW, SEX AND DISABILITY EMPLOYMENT DISCRIMINATION COMPLAINT PROPERLY AMENDED UNDER THE RELATION BACK STATUTE WITH OTHERWISE UNTIMELY CAUSES OF ACTION ALLEGING SEXUAL ORIENTATION DISCRIMINATION (FIRST DEPT))/SEXUAL ORIENTATION DISCRIMINATION (HUMAN RIGHTS LAW, SEX AND DISABILITY EMPLOYMENT DISCRIMINATION COMPLAINT PROPERLY AMENDED UNDER THE RELATION BACK STATUTE WITH OTHERWISE UNTIMELY CAUSES OF ACTION ALLEGING SEXUAL ORIENTATION DISCRIMINATION (FIRST DEPT))/SEX DISCRIMINATION (HUMAN RIGHTS LAW, SEX AND DISABILITY EMPLOYMENT DISCRIMINATION COMPLAINT PROPERLY AMENDED UNDER THE RELATION BACK STATUTE WITH OTHERWISE UNTIMELY CAUSES OF ACTION ALLEGING SEXUAL ORIENTATION DISCRIMINATION (FIRST DEPT))

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LAW OFFICE CONFUSION NOT A SUFFICIENT EXCUSE FOR BANK ATTORNEY’S FAILURE TO ATTEND A SETTLEMENT CONFERENCE, DEFAULT JUDGMENT DISMISSING THE COMPLAINT SHOULD NOT HAVE BEEN VACATED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the bank’s (OneWest’s) motion to vacate a default judgment dismissing the complaint should not have been granted. One West’s attorney did not show up for a scheduled settlement conference:

OneWest moved pursuant to CPLR 5015(a)(1) to vacate the order entered upon its default in appearing at the conferences and to restore the action to the active calendar. In support of its motion, OneWest alleged that it was unaware of the scheduled conferences “due to law office confusion” following the substitution of counsel. The Supreme Court granted the motion. [Defendant] appeals.

A plaintiff seeking to vacate a default in appearing at a conference is required to demonstrate both a reasonable excuse for its default and a potentially meritorious cause of action… . Although “[a] motion to vacate a default is addressed to the sound discretion of the motion court” … , the defaulting party must submit evidence in admissible form establishing both a reasonable excuse and a potentially meritorious cause of action or defense … .

A court has the discretion to accept law office failure as a reasonable excuse for a party’s default … . However, “it was not the Legislature’s intent to routinely excuse such defaults” … , and mere neglect is not a reasonable excuse… .

Contrary to OneWest’s contention, it failed to provide a detailed and credible explanation of the default… . Rather, counsel’s affirmation in support of the motion contained only the conclusory and undetailed allegation of “law office confusion” after being substituted as counsel for OneWest, which does not constitute a reasonable excuse… . No other evidence was submitted to corroborate the allegation. OneWest, therefore, failed to demonstrate a reasonable excuse for its default … . OneWest Bank, FSB v Singer, 2017 NY Slip Op 06184, Second Dept 8-16-17

 

FORECLOSURE (LAW OFFICE CONFUSION NOT A SUFFICIENT EXCUSE FOR BANK ATTORNEY’S FAILURE TO ATTEND A SETTLEMENT CONFERENCE, DEFAULT JUDGMENT DISMISSING THE COMPLAINT SHOULD NOT HAVE BEEN VACATED (SECOND DEPT))/CIVIL PROCEDURE (FORECLOSURE, SETTLEMENT CONFERENCE, LAW OFFICE CONFUSION NOT A SUFFICIENT EXCUSE FOR BANK ATTORNEY’S FAILURE TO ATTEND A SETTLEMENT CONFERENCE, DEFAULT JUDGMENT DISMISSING THE COMPLAINT SHOULD NOT HAVE BEEN VACATED (SECOND DEPT))/ATTORNEYS (FORECLOSURE, LAW OFFICE CONFUSION NOT A SUFFICIENT EXCUSE FOR BANK ATTORNEY’S FAILURE TO ATTEND A SETTLEMENT CONFERENCE, DEFAULT JUDGMENT DISMISSING THE COMPLAINT SHOULD NOT HAVE BEEN VACATED (SECOND DEPT))/SETTLEMENT CONFERENCE LAW OFFICE CONFUSION NOT A SUFFICIENT EXCUSE FOR BANK ATTORNEY’S FAILURE TO ATTEND A SETTLEMENT CONFERENCE, DEFAULT JUDGMENT DISMISSING THE COMPLAINT SHOULD NOT HAVE BEEN VACATED (SECOND DEPT))(FORECLOSURE)

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LETTERS PURPORTING TO CONSTITUTE TIME OF THE ESSENCE NOTICE DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH CAN SUPPORT A MOTION TO DISMISS, ALTHOUGH NOT RAISED BELOW THE DOCUMENTARY EVIDENCE ISSUE WAS A PROPER BASIS FOR REVERSAL ON APPEAL (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the letters evincing a “time of the essence” notification in the underlying real estate transaction did not constitute “documentary evidence” which would support a motion to dismiss. Although he “documentary evidence” argument was not raised below, the court properly considered it as the basis for reversal as a matter of law:

“A motion pursuant to CPLR 3211(a)(1) to dismiss based on documentary evidence may be appropriately granted only where the documentary evidence utterly refutes the plaintiff’s factual allegations, thereby conclusively establishing a defense as a matter of law”… . “The evidence submitted in support of such motion must be documentary or the motion must be denied” … . “In order for evidence submitted in support of a CPLR 3211(a)(1) motion to qualify as documentary evidence,’ it must be unambiguous, authentic, and undeniable'”… .

“[J]udicial records, as well as documents reflecting out-of-court transactions such as mortgages, deeds, contracts, and any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence in the proper case” … . “At the same time, [n]either affidavits, deposition testimony, nor letters are considered documentary evidence within the intendment of CPLR 3211(a)'” … .

Here, the letters submitted by the defendant did not constitute documentary evidence within the meaning of CPLR 3211(a)(1), and should not have been relied upon by the Supreme Court as a basis for granting the defendant’s motion to dismiss the complaint. The only documentary evidence submitted in support of the defendant’s motion was the purchase agreement, which did not “utterly refute” the plaintiffs’ allegations or conclusively establish a defense as a matter of law. Contrary to the defendant’s contention, the issue of whether the letters constitute documentary evidence within the intendment of CPLR 3211(a)(1) can be raised for the first time on appeal because it is one of law which appears on the face of the record and could not have been avoided if it had been raised at the proper juncture … . Feldshteyn v Brighton Beach 2012, LLC, 2017 NY Slip Op 06160, Second Dept 8-16-17

CIVIL PROCEDURE (MOTION TO DISMISS, LETTERS PURPORTING TO CONSTITUTE TIME OF THE ESSENCE NOTICE DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH CAN SUPPORT A MOTION TO DISMISS (SECOND DEPT))/EVIDENCE (MOTION TO DISMISS, LETTERS PURPORTING TO CONSTITUTE TIME OF THE ESSENCE NOTICE DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH CAN SUPPORT A MOTION TO DISMISS (SECOND DEPT))/APPEALS (LETTERS PURPORTING TO CONSTITUTE TIME OF THE ESSENCE NOTICE DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH CAN SUPPORT A MOTION TO DISMISS, ALTHOUGH NOT RAISED BELOW THE DOCUMENTARY EVIDENCE ISSUE WAS A PROPER BASIS FOR REVERSAL ON APPEAL (SECOND DEPT))/REAL ESTATE (LETTERS PURPORTING TO CONSTITUTE TIME OF THE ESSENCE NOTICE DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH CAN SUPPORT A MOTION TO DISMISS, ALTHOUGH NOT RAISED BELOW THE DOCUMENTARY EVIDENCE ISSUE WAS A PROPER BASIS FOR REVERSAL ON APPEAL (SECOND DEPT))/DISMISS, MOTION TO (CIVIL PROCEDURE,  (LETTERS PURPORTING TO CONSTITUTE TIME OF THE ESSENCE NOTICE DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH CAN SUPPORT A MOTION TO DISMISS (SECOND DEPT))/DOCUMENTARY EVIDENCE (CIVIL PROCEDURE, MOTION TO DISMISS, LETTERS PURPORTING TO CONSTITUTE TIME OF THE ESSENCE NOTICE DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH CAN SUPPORT A MOTION TO DISMISS (SECOND DEPT))/EVIDENCE (MOTION TO DISMISS, LETTERS PURPORTING TO CONSTITUTE TIME OF THE ESSENCE NOTICE DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH CAN SUPPORT A MOTION TO DISMISS (SECOND DEPT))

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ATTORNEY LETTERS DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH WOULD SUPPORT A MOTION TO DISMISS (SECOND DEPT).

The Second Department determined attorney letters did not constitute documentary evidence which would support a motion to dismiss in this insurance-coverage dispute:

A motion to dismiss a complaint pursuant to CPLR 3211(a)(1) may be granted only if the documentary evidence submitted utterly refutes the factual allegations of the complaint and conclusively establishes a defense to the claims as a matter of law … . In order for evidence to qualify as documentary, it must be unambiguous, authentic, and undeniable … . Neither affidavits, deposition testimony, nor letters are considered documentary evidence within the intendment of CPLR 3211(a)(1) … . Accordingly, the letters from the attorney and claims services relied upon by [the insurer] do not constitute documentary evidence for the purposes of CPLR 3211(a)(1). Additionally, the insurance policy, which does constitute documentary evidence, did not utterly refute the factual allegations of the complaint and did not conclusively establish a defense to the claims as a matter of law. Fox Paine & Co., LLC v Houston Cas. Co., 2017 NY Slip Op 06162, Second Dept 8-16-17

CIVIL PROCEDURE (MOTION TO DISMISS, DOCUMENTARY EVIDENCE, ATTORNEY LETTERS DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH WOULD SUPPORT A MOTION TO DISMISS (SECOND DEPT))/DISMISS, MOTION TO (EVIDENCE, ATTORNEY LETTERS DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH WOULD SUPPORT A MOTION TO DISMISS (SECOND DEPT))/EVIDENCE (MOTION TO DISMISS, DOCUMENTARY EVIDENCE, ATTORNEY LETTERS DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH WOULD SUPPORT A MOTION TO DISMISS (SECOND DEPT))/DOCUMENTARY EVIDENCE (MOTION TO DISMISS, ATTORNEY LETTERS DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH WOULD SUPPORT A MOTION TO DISMISS (SECOND DEPT))/INSURANCE LAW (CIVIL PROCEDURE, MOTION TO DISMISS, ATTORNEY LETTERS DID NOT CONSTITUTE DOCUMENTARY EVIDENCE WHICH WOULD SUPPORT A MOTION TO DISMISS (SECOND DEPT))

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