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CAUSES OF ACTION AGAINST ACCOUNTANTS STEMMING FROM A WORKERS’ COMPENSATION TRUST FOUND TO BE $8 MILLION IN DEBT SURVIVED MOTIONS TO DISMISS, SIX YEAR STATUTE OF LIMITATIONS APPLIES TO INTENTIONAL (AS OPPOSED TO NEGLIGENT) CONDUCT.

The Third Department determined Supreme Court should not have dismissed the breach of fiduciary duty cause of action against defendant accountants (Fuller) stemming from a workers’ compensation trust found to be more than $8 million in debt. The 2nd Department also found Supreme Court properly applied the six year statute of limitations to the allegedly intentional acts by the defendant accountants (designed to conceal the debt). The defendant accountants unsuccessfully argued the three-year (negligence/malpractice) statute of limitations should apply. Regarding the breach of fiduciary duty cause of action, the 2nd Department explained:

Although the duty owed by an accountant is generally not fiduciary in nature … , a fiduciary relationship exists where the accountant is “under a duty to act for or to give advice for the benefit of [the client] upon matters within the scope of the relation” … . This inquiry is “necessarily fact-specific” … , and the dispositive factor is whether there is “confidence on one side and resulting superiority and influence on the other” … . Plaintiff alleged that Fuller held itself out to have the requisite skill and expertise to maintain the trust’s financial records, provide auditing services and — importantly — provide advice to the trust regarding the trust’s financial status. According to plaintiff, Fuller breached its fiduciary duty by knowingly and consistently concealing the trust’s true financial condition and failing to properly advise the trust regarding its solvency, causing over $8 million in damages. Accepting these allegations as true and giving plaintiff the benefit of every favorable inference … , we find that plaintiff’s cause of action for breach of fiduciary duty is sufficiently stated to survive Fuller’s motion to dismiss … .  New York State Workers’ Compensation Bd. v Fuller & LaFiura, CPAs, P.C., 2017 NY Slip Op 00225, 3rd Dept 1-12-17

 

WORKERS’ COMPENSATION LAW (CAUSES OF ACTION AGAINST ACCOUNTANTS STEMMING FROM A WORKERS’ COMPENSATION TRUST FOUND TO BE $8 MILLION IN DEBT SURVIVED MOTIONS TO DISMISS)/FRAUD (CAUSES OF ACTION AGAINST ACCOUNTANTS STEMMING FROM A WORKERS’ COMPENSATION TRUST FOUND TO BE $8 MILLION IN DEBT SURVIVED MOTIONS TO DISMISS)/CIVIL PROCEDURE (SIX YEAR STATUTE OF LIMITATIONS APPLIED TO INTENTIONAL ACTS BY ACCOUNTANTS, CAUSES OF ACTION AGAINST ACCOUNTANTS STEMMING FROM A WORKERS’ COMPENSATION TRUST FOUND TO BE $8 MILLION IN DEBT SURVIVED MOTIONS TO DISMISS)/FIDUCIARY DUTY (BREACH OF FIDUCIARY DUTY CAUSE OF ACTION AGAINST ACCOUNTANTS STEMMING FROM A WORKERS’ COMPENSATION TRUST FOUND TO BE $8 MILLION IN DEBT SHOULD HAVE SURVIVED MOTION TO DISMISS)/ACCOUNTANTS (CAUSES OF ACTION AGAINST ACCOUNTANTS STEMMING FROM A WORKERS’ COMPENSATION TRUST FOUND TO BE $8 MILLION IN DEBT SURVIVED MOTIONS TO DISMISS, SIX YEAR STATUTE OF LIMITATIONS APPLIED TO INTENTIONAL ACTS BY ACCOUNTANTS)/STATUTE OF LIMITATIONS CAUSES OF ACTION AGAINST ACCOUNTANTS STEMMING FROM A WORKERS’ COMPENSATION TRUST FOUND TO BE $8 MILLION IN DEBT SURVIVED MOTIONS TO DISMISS, SIX YEAR STATUTE OF LIMITATIONS APPLIED TO INTENTIONAL ACTS BY ACCOUNTANTS)

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DEFENDANT’S SUMMARY JUDGMENT MOTION WAS PREMATURE, PIERCING THE CORPORATE VEIL MIGHT BE AN ISSUE DETERMINING WHETHER WORKERS’ COMPENSATION IS THE SOLE REMEDY, FURTHER DISCOVERY NEEDED.

The Third Department determined defendant’s summary judgment motion in this wrongful death action should have been denied as premature. Plaintiff’s decedent was killed in a workplace accident and workers’ compensation death benefits were paid out. In addition to arguing that workers’ compensation was plaintiff’s sole remedy, defendant argued the corporation plaintiff sued had been dissolved and assets transferred to another corporation. Because piercing the corporate veil might be an issue, the Third Department held that plaintiff was entitled to discovery to flesh out the relationship among plaintiff’s decedent and the two corporations:

“[A] summary judgment motion is properly denied as premature when the nonmoving party has not been given reasonable time and opportunity to conduct disclosure relative to pertinent evidence that is within the exclusive knowledge of the movant or a codefendant” … . Although we have held that, “in certain situations, . . . more than one entity may be considered a plaintiff’s employer for purposes of workers’ compensation” … , defendant’s submissions fall far short of establishing that premise as a matter of law. A determination as to whether two entities are alter egos of each other requires a far more detailed record than is present here … . Pringle v AC Bodyworks & Sons, LLC, 2016 NY Slip Op 08924, 3rd Dept 12-29-16

CIVIL PROCEDURE (DEFENDANT’S SUMMARY JUDGMENT MOTION WAS PREMATURE, PIERCING THE CORPORATE VEIL MIGHT BE AN ISSUE, FURTHER DISCOVERY NEEDED)/CORPORATION LAW (DEFENDANT’S SUMMARY JUDGMENT MOTION WAS PREMATURE, PIERCING THE CORPORATE VEIL MIGHT BE AN ISSUE, FURTHER DISCOVERY NEEDED)/WORKERS’ COMPENSATION LAW (DEFENDANT’S SUMMARY JUDGMENT MOTION WAS PREMATURE, PIERCING THE CORPORATE VEIL MIGHT BE AN ISSUE TO DETERMINE WHETHER WORKERS’ COMPENSATION IS THE SOLE REMEDY, FURTHER DISCOVERY NEEDED)/NEGLIGENCE (DEFENDANT’S SUMMARY JUDGMENT MOTION WAS PREMATURE, PIERCING THE CORPORATE VEIL MIGHT BE AN ISSUE TO DETERMINE WHETHER WORKERS’ COMPENSATION IS THE SOLE REMEDY, FURTHER DISCOVERY NEEDED)/WRONGFUL DEATH (DEFENDANT’S SUMMARY JUDGMENT MOTION WAS PREMATURE, PIERCING THE CORPORATE VEIL MIGHT BE AN ISSUE TO DETERMINE WHETHER WORKERS’ COMPENSATION IS THE SOLE REMEDY, FURTHER DISCOVERY NEEDED)

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DEFENDANT DID NOT DEMONSTRATE DOCUMENTS SOUGHT BY A DISCOVERY DEMAND WERE ENTITLED TO CONDITIONAL IMMUNITY AS DOCUMENTS PREPARED IN ANTICIPATION OF LITIGATION, MATTER REMITTED FOR COURT REVIEW OF THE DOCUMENTS.

In an action against a veterinary clinic stemming from an alleged attack by a dog in the waiting room, the Third Department determined the clinic did not demonstrate documents sought by plaintiff’s discovery demands were entitled to conditional immunity as documents prepared for litigation. The matter was remitted for court review of the documents:

Inasmuch as “[t]he purpose of liability insurance is the defense and settlement of claims . . . once an accident has arisen,” documents contained in the insurance adjuster’s file are generally protected by “a conditional immunity . . . as material prepared for litigation” … . Accident reports that are prepared with “a mixed purpose and result at least in part from the internal operations of the defendant’s business” are not, however, exempt from disclosure … . It is therefore incumbent upon “the party resisting disclosure to[, in the first instance,] show that the materials sought were prepared solely for litigation and this burden cannot be satisfied with wholly conclusory allegations” … . Hewitt v Palmer Veterinary Clinic, PC, 2016 NY Slip Op 08926, 3rd Dept 12-29-16

INSURANCE LAW (DEFENDANT DID NOT DEMONSTRATE DOCUMENTS SOUGHT BY A DISCOVERY DEMAND WERE ENTITLED TO CONDITIONAL IMMUNITY AS DOCUMENTS PREPARED IN ANTICIPATION OF LITIGATION, MATTER REMITTED FOR COURT REVIEW OF THE DOCUMENTS)/NEGLIGENCE (DEFENDANT DID NOT DEMONSTRATE DOCUMENTS SOUGHT BY A DISCOVERY DEMAND WERE ENTITLED TO CONDITIONAL IMMUNITY AS DOCUMENTS PREPARED IN ANTICIPATION OF LITIGATION, MATTER REMITTED FOR COURT REVIEW OF THE DOCUMENTS)/CIVIL PROCEDURE (DISCOVERY, CONDITIONAL IMMUNITY, DEFENDANT DID NOT DEMONSTRATE DOCUMENTS SOUGHT BY A DISCOVERY DEMAND WERE ENTITLED TO CONDITIONAL IMMUNITY AS DOCUMENTS PREPARED IN ANTICIPATION OF LITIGATION, MATTER REMITTED FOR COURT REVIEW OF THE DOCUMENTS)/CONDITIONAL IMMUNITY (DEFENDANT DID NOT DEMONSTRATE DOCUMENTS SOUGHT BY A DISCOVERY DEMAND WERE ENTITLED TO CONDITIONAL IMMUNITY AS DOCUMENTS PREPARED IN ANTICIPATION OF LITIGATION, MATTER REMITTED FOR COURT REVIEW OF THE DOCUMENTS)/PRIVILEGE (DEFENDANT DID NOT DEMONSTRATE DOCUMENTS SOUGHT BY A DISCOVERY DEMAND WERE ENTITLED TO CONDITIONAL IMMUNITY AS DOCUMENTS PREPARED IN ANTICIPATION OF LITIGATION, MATTER REMITTED FOR COURT REVIEW OF THE DOCUMENTS)/ACCIDENT REPORTS (DEFENDANT DID NOT DEMONSTRATE DOCUMENTS SOUGHT BY A DISCOVERY DEMAND WERE ENTITLED TO CONDITIONAL IMMUNITY AS DOCUMENTS PREPARED IN ANTICIPATION OF LITIGATION, MATTER REMITTED FOR COURT REVIEW OF THE DOCUMENTS)

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CRITERIA FOR DENIAL OF A MOTION FOR SUMMARY JUDGMENT AS PREMATURE ILLUSTRATED.

CIVIL PROCEDURE, INSURANCE LAW, CONTRACT LAW.

The Third Department determined defendant insurance company’s motion for summary judgment should have been denied as premature. Plaintiff was seeking reformation of the insurance contract to add plaintiff as an insured. Plaintiff held a mortgage on the insured property when the property was destroyed by fire:

Erie’s [the insurance company’s] motion for summary judgment should have been denied as premature. “[A] summary judgment motion is properly denied as premature when the nonmoving party has not been given reasonable time and opportunity to conduct disclosure relative to pertinent evidence that is within the exclusive knowledge of the movant or a codefendant” … . As is relevant to plaintiff’s claim, a party seeking reformation of a contract must establish, by clear and convincing evidence, either that the writing at issue was executed under mutual mistake or that there was a fraudulently induced unilateral mistake … .

The importance of documents and depositions that plaintiff sought but had not been provided is readily apparent. The premise of plaintiff’s cause of action is that, in executing the relevant insurance policy, the corporation and Erie both intended to include plaintiff as a loss payee but that, by mutual mistake, he was omitted. Erie had exclusive knowledge of its understanding of the intended coverage and any intended loss payees at the time of the execution of the relevant insurance policy. Moreover, it is likely to be in exclusive possession of any collateral documents memorializing the intended scope of the relevant insurance policy. Further, plaintiff’s contention that Erie has exclusive possession of employees and materials that could shed light on its intent as to the insurance policy is patently reasonable and not merely speculation … . Imrie v Ratto, 2016 NY Slip Op 08907, 3rd Dept 12-29-16

CIVIL PROCEDURE (CRITERIA FOR DENIAL OF A MOTION FOR SUMMARY JUDGMENT AS PREMATURE ILLUSTRATED)/SUMMARY JUDGMENT (CRITERIA FOR DENIAL OF A MOTION FOR SUMMARY JUDGMENT AS PREMATURE ILLUSTRATED)/INSURANCE LAW (REFORMATION OF POLICY, CRITERIA FOR DENIAL OF A MOTION FOR SUMMARY JUDGMENT AS PREMATURE ILLUSTRATED)/CONTRACT (REFORMATION, CRITERIA FOR DENIAL OF A MOTION FOR SUMMARY JUDGMENT AS PREMATURE ILLUSTRATED)/REFORMATION (INSURANCE POLICY, CRITERIA FOR DENIAL OF A MOTION FOR SUMMARY JUDGMENT AS PREMATURE ILLUSTRATED)

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ORDER WHICH IS NOT ISSUED PURSUANT TO A MOTION ON NOTICE IS NOT APPEALABLE, A MOTION TO VACATE IS THE PROPER PROCEDURE.

 

The Third Department, reversing Supreme Court, noted that an order which is not issued pursuant to a motion on notice is not appealable. The proper procedure is to move to vacate the order and, if the motion is denied, appeal the denial:

… [P]laintiff followed the appropriate procedure in moving to vacate the … order. Contrary to Supreme Court’s determination, plaintiff could not have challenged the order by taking a direct appeal. As the order was made in response to plaintiff’s letter and did not decide a motion made upon notice, it was not appealable as of right (see CPLR 5701 [a] [2]…). Such an order is properly challenged by moving on notice for vacatur, as plaintiff did here, and then by taking an appeal as of right if the requested relief is denied (see CPLR 5701 [a] [3]…). Thus, the court should have addressed the merits of plaintiff’s motion to vacate the … order, and the application should not have been denied based upon the standards applicable to motions pursuant to CPLR 5015 and 2221. Novastar Mtge., Inc. v Melius, 2016 NY Slip Op 08928, 3rd Dept 12-29-16

 

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DEFENDANTS’ SUMMARY JUDGMENT MOTION WAS PREMATURE, PLAINTIFF ENTITLED TO DISCOVERY TO FLESH OUT RELATIONSHIP AMONG PARTIES, RELATION-BACK DOCTRINE ALLOWED AMENDMENT OF COMPLAINT TO ADD PARTY, NOTICE OF CLAIM REQUIRED FOR SUIT AGAINST LONG ISLAND POWER AUTHORITY.

CIVIL PROCEDURE, MUNICIPAL LAW.

The Second Department, reversing Supreme Court, determined defendants’ motion for summary judgment in this rear-end collision case was premature. The truck which struck plaintiff’s vehicle was registered to Long Island Power Authority (LIPA) but the driver was an employee of National Grid, which was under contract with LIPA. Plaintiff never served a notice of claim on LIPA, as required by the Public Authorities Law and the General Municipal Law. The Second Department held that plaintiff was entitled to discovery concerning the relationship between LIPA and National Grid, and further held that the relation-back doctrine allowed the amendment of the complaint to add National Grid as a defendant:

A party who contends that a motion for summary judgment is premature must “demonstrate that discovery might lead to relevant evidence or that the facts essential to justify opposition to the motion were exclusively within the knowledge and control of the movant” … . In opposition to the defendants’ motion for summary judgment, the plaintiff demonstrated that the defendants had not revealed that, at the time of the subject accident, the defendant driver was actually employed by National Grid LLC, and not LIPA, until the defendants filed their summary judgment motion. The award of summary judgment dismissing the complaint insofar as asserted against the defendant driver was therefore premature, inasmuch as substantial discovery with respect to the relationship between the National Grid LLC and the defendant driver, as well as the nature of the business the defendant driver was conducting at the time of the subject accident, remains outstanding … . Marrone v Miloscio, 2016 NY Slip Op 08856, 2nd Dept 12-28-16

CIVIL PROCEDURE (DEFENDANTS’ SUMMARY JUDGMENT MOTION WAS PREMATURE, PLAINTIFF ENTITLED TO DISCOVERY TO FLESH OUT RELATIONSHIP AMONG PARTIES, RELATION-BACK DOCTRINE ALLOWED AMENDMENT OF COMPLAINT TO ADD PARTY)/CIVIL PROCEDURE (RELATION-BACK DOCTRINE ALLOWED AMENDMENT OF COMPLAINT TO ADD PARTY)/SUMMARY JUDGMENT (DEFENDANTS’ SUMMARY JUDGMENT MOTION WAS PREMATURE, PLAINTIFF ENTITLED TO DISCOVERY TO FLESH OUT RELATIONSHIP AMONG PARTIES)/MUNICIPAL LAW (NOTICE OF CLAIM REQUIRED FOR SUIT AGAINST LONG ISLAN POWER AUTHORITY)/NOTICE OF CLAIM (SUIT AGAINS LONG ISLAND POWER AUTHORITY)

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AN ORDER IS NOT ABANDONDED PURSUANT TO 22 NYCRR 202.48 UNLESS THE ORDER DIRECTS THAT IT BE SETTLED OR SUBMITTED FOR SIGNATURE.

The Second Department, reversing Supreme Court, determined dismissal of a motion to enter a default judgment as abandoned pursuant to 22 NYCTT 202.48(b) was improper because the underlying order did not direct that it be settled or submitted for signature:

The Supreme Court incorrectly, sua sponte, dismissed the action as abandoned pursuant to 22 NYCRR 202.48(b) because … its determination of the plaintiff’s 2014 motion did not expressly direct that the proposed judgment or order be settled or submitted for signature (see 22 NYCRR 202.48[a]; Funk v Barry, 89 NY2d 364, 367). HSBC Bank USA, N.A. v Moley, 2016 NY Slip Op 08844, 2nd Dept 12-28-16

CIVIL PROCEDURE (AN ORDER IS NOT ABANDONDED PURSUANT TO 22 NYCRR 202.48 UNLESS THE ORDER DIRECTS THAT IT BE SETTLED OR SUBMITTED FOR SIGNATURE)/ABANDONMENT (CIVIL PROCEDURE, ORDERS AND JUDGMENTS, AN ORDER IS NOT ABANDONDED PURSUANT TO 22 NYCRR 202.48 UNLESS THE ORDER DIRECTS THAT IT BE SETTLED OR SUBMITTED FOR SIGNATURE)/ORDERS (ABANDONMENT, (AN ORDER IS NOT ABANDONDED PURSUANT TO 22 NYCRR 202.48 UNLESS THE ORDER DIRECTS THAT IT BE SETTLED OR SUBMITTED FOR SIGNATURE)

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PLAINTIFF NEED NOT ELIMINATE ALL OTHER POSSIBLE CAUSES OF INJURY TO MAKE OUT A PRIMA FACIE CASE OF MEDICAL MALPRACTICE, MOTION FOR A DIRECTED VERDICT SHOULD NOT HAVE BEEN GRANTED.

The Third Department, in a full-fledged opinion by Justice Peters, determined certain causes of action in this medical malpractice suit should have been allowed to go to the jury. Defendant’s motion for a directed verdict should not have been granted. Most of the opinion is fact-generated and cannot be summarized here. The law surrounding a directed verdict in this context, including the applicability of the doctrine of res ipsa loquitur, was explained. A plaintiff is not required to eliminate all other possible causes of injury to make out a prima facie case:

A directed verdict is only appropriate “when, viewing the evidence in a light most favorable to the nonmoving part[y] and affording such part[y] the benefit of every inference, there is no rational process by which a jury could find in favor of the nonmovant[]” … . “[A] plaintiff asserting a medical malpractice claim must demonstrate that the doctor deviated from acceptable medical practice, and that such deviation was a proximate cause of the plaintiff’s injury” … . “[T]o establish proximate causation, the plaintiff must demonstrate that the defendant’s deviation from the standard of care was a substantial factor in bringing about the injury” … . A plaintiff in a medical malpractice action may also rely on the doctrine of res ipsa loquitur … , which “permits the jury to infer negligence and causation sufficient to establish a prima facie case based on circumstantial evidence” … . “Notably, a plaintiff is not required to eliminate all other possible causes of the injury in order to establish a prima facie case” of medical malpractice … . * * *

“Whether or not res ipsa loquitur was applicable here, plaintiff presented sufficient evidence of negligence to go to the jury” on two of her three theories of liability … . Upon the evidence submitted, Supreme Court properly rejected plaintiff’s first theory of liability as a matter of law at the close of plaintiff’s proof, yet provided no explanation for dismissing the entire complaint, and we can perceive none under the circumstances of this case given the existence of two viable and independent theories of liability that were supported by sufficient trial proof … . Majid v Cheon-Lee, 2016 NY Slip Op 08572, 3rd Dept 12-22-16

 

NEGLIGENCE (PLAINTIFF NEED NOT ELIMINATE ALL OTHER POSSIBLE CAUSES OF INJURY TO MAKE OUT A PRIMA FACIE CASE OF MEDICAL MALPRACTICE, MOTION FOR A DIRECTED VERDICT SHOULD NOT HAVE BEEN GRANTED)/MEDICAL MALPRACTICE (PLAINTIFF NEED NOT ELIMINATE ALL OTHER POSSIBLE CAUSES OF INJURY TO MAKE OUT A PRIMA FACIE CASE OF MEDICAL MALPRACTICE, MOTION FOR A DIRECTED VERDICT SHOULD NOT HAVE BEEN GRANTED)/CIVIL PROCEDURE (DIRECTED VERDICT, MEDICAL MALPRACTICE, PLAINTIFF NEED NOT ELIMINATE ALL OTHER POSSIBLE CAUSES OF INJURY TO MAKE OUT A PRIMA FACIE CASE OF MEDICAL MALPRACTICE, MOTION FOR A DIRECTED VERDICT SHOULD NOT HAVE BEEN GRANTED)/DIRECTED VERDICT (MEDICAL MALPRACTICE, PLAINTIFF NEED NOT ELIMINATE ALL OTHER POSSIBLE CAUSES OF INJURY TO MAKE OUT A PRIMA FACIE CASE OF MEDICAL MALPRACTICE, MOTION FOR A DIRECTED VERDICT SHOULD NOT HAVE BEEN GRANTED)

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FALSE ARREST AND 42 USC 1983 CAUSES OF ACTION SHOULD HAVE BEEN DISMISSED, ARREST STEMMING FROM A WARRANT WAS PRIVILEGED.

The Second Department determined the city’s motion to dismiss the complaint as a matter of law, made at the close of plaintiff’s proof, should have been granted. Plaintiff was stopped by the police for urinating in public. Based on an outstanding warrant for plaintiff’s arrest, plaintiff was arrested and detained. After dismissal of the charges, plaintiff sued alleging false arrest and civil rights violations (42 USC 1983). Because plaintiff’s arrest was pursuant to a warrant, the arrest was privileged and could not form the basis of the false arrest and 42 USC 1983 causes of action:

To be awarded judgment as a matter of law pursuant to CPLR 4401, a defendant must show that, upon viewing the evidence in the light most favorable to the plaintiff, there is no rational basis by which the jury could find for the plaintiff against the moving defendant … . The plaintiff’s evidence must be accepted as true, and the plaintiff is entitled to every favorable inference that can be reasonably drawn therefrom … .

Where the confinement or detention of an individual against his or her will is privileged, a cause of action alleging false arrest will not lie … . One instance in which the privilege applies is when the confinement is based on a facially valid arrest warrant, issued by a court having jurisdiction … .

Here, the plaintiff did not contest the fact that the warrant was facially valid, and was issued by a court of competent jurisdiction. Ali v City of New York, 2016 NY Slip Op 08490, Second Dept 12-22-16

MUNICIPAL LAW (FALSE ARREST AND 42 USC 1983 CAUSES OF ACTION SHOULD HAVE BEEN DISMISSED, ARREST STEMMING FROM A WARRANT WAS PRIVILEGED)/CIVIL RIGHTS (FALSE ARREST AND 42 USC 1983 CAUSES OF ACTION SHOULD HAVE BEEN DISMISSED, ARREST STEMMING FROM A WARRANT WAS PRIVILEGED)/FALSE ARREST (FALSE ARREST AND 42 USC 1983 CAUSES OF ACTION SHOULD HAVE BEEN DISMISSED, ARREST STEMMING FROM A WARRANT WAS PRIVILEGED)/42 USC 1983 (FALSE ARREST AND 42 USC 1983 CAUSES OF ACTION SHOULD HAVE BEEN DISMISSED, ARREST STEMMING FROM A WARRANT WAS PRIVILEGED)

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COURTS OF EQUITY HAVE BROAD POWERS TO ACT IN THE INTEREST OF JUSTICE, FORECLOSURE IS EQUITABLE IN NATURE, MOTION TO VACATE DEFAULT SHOULD HAVE BEEN GRANTED.

The Second Department, reversing Supreme Court, determined that defendant’s motion to vacate a default judgment in this foreclosure action should have been granted in the interest of justice. The court explained the “interest of justice” powers in this context:

“In addition to the grounds set forth in section 5015(a), a court may vacate its own judgment for sufficient reason and in the interests of substantial justice” … . Moreover, “[a] foreclosure action is equitable in nature and triggers the equitable powers of the court … . “Once equity is invoked, the court’s power is as broad as equity and justice require” … . Thus, a court may rely on “its inherent authority to vacate [a judgment] in the interest of substantial justice, rather than its statutory authority under CPLR 5015(a),” as the “statutory grounds are subsumed by the court’s broader inherent authority” … . U.S. Bank Natl. Assn. v Losner, 2016 NY Slip Op 08560, 2nd Dept 12-21-16

CIVIL PROCEDURE (COURTS OF EQUITY HAVE BROAD POWERS TO ACT IN THE INTEREST OF JUSTICE, FORECLOSURE IS EQUITABLE IN NATURE, MOTION TO VACATE DEFAULT SHOULD HAVE BEEN GRANTED)/FORECLOSURE (COURTS OF EQUITY HAVE BROAD POWERS TO ACT IN THE INTEREST OF JUSTICE, FORECLOSURE IS EQUITABLE IN NATURE, MOTION TO VACATE DEFAULT SHOULD HAVE BEEN GRANTED)/EQUITY (COURTS OF EQUITY HAVE BROAD POWERS TO ACT IN THE INTEREST OF JUSTICE, FORECLOSURE IS EQUITABLE IN NATURE, MOTION TO VACATE DEFAULT SHOULD HAVE BEEN GRANTED)/DEFAULT, MOTION TO VACATE (FORECLOSURE, COURTS OF EQUITY HAVE BROAD POWERS TO ACT IN THE INTEREST OF JUSTICE, FORECLOSURE IS EQUITABLE IN NATURE, MOTION TO VACATE DEFAULT SHOULD HAVE BEEN GRANTED)

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