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“Intrinsic” Versus “Extrinsic” Fraud as the Basis of a Motion to Open a Default Judgment/Lack of Standing Not a Jurisdictional Defect

In the context of a mortgage foreclosure, the defendant made a motion pursuant to CPLR 5015(a)(3) to open a default judgment.  The Second Department determined the motion was properly denied and explained the difference between allegations of “intrinsic” and “extrinsic” fraud as the basis of the motion.  The court noted that a lack of standing is not a jurisdictional defect:

The defendant alleged, pursuant to CPLR 5015(a)(3), that the plaintiff committed “intrinsic fraud,” by submitting fraudulent documents in support of its claim for a judgment of foreclosure and sale … . She did not allege “extrinsic fraud,” which is “a fraud practiced in obtaining a judgment such that a party may have been prevented from fully and fairly litigating the matter” … . Therefore, the defendant was required to show a reasonable excuse for her default … . However, she failed to offer any excuse for her default … . U.S. Bank, N.A. v Peters, 2015 NY Slip Op 02757, 2nd Dept 4-1-15

 

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Court Properly Declined to Exercise Jurisdiction Over Child Custody/Access Matters Because the Children No Longer Had a Sufficient Connection with New York State

The Second Department determined Supreme Court properly refused to consider child custody/access matters because the children no longer had a significant connection with New York:

New York is the children’s “home state,” since they resided here for six consecutive months before the commencement of the child custody proceeding (Domestic Relations Law § 76[1][a]; see Domestic Relations Law § 76-a…). The judgment of divorce, which determined the parties’ child custody issues, confers continuing jurisdiction over the children with the New York Courts (see Domestic Relations Law §§ 76, 76-a). However, a New York court may decline to exercise jurisdiction where, as here, neither of the parents nor any of the children retain a significant connection with New York and substantial evidence is no longer available in this state concerning the children’s care, protection, training, and personal relationships (see Domestic Relations Law § 76-a[1][a]…). A court may also decline to exercise jurisdiction where it determines that the children or the children’s parents no longer reside in New York (see Domestic Relations Law § 76-a[1][a], [b]…). Under Domestic Relations Law § 76-f, a court may decline to exercise jurisdiction if it determines, after an evaluation of statutory factors, that New York is an inconvenient forum and that another state provides a more appropriate forum … . Here, since the defendant resides in California, and the plaintiff and children moved to Maryland in November 2012, the Supreme Court, after considering the statutory factors set forth in Domestic Relations Law § 76-f(2)(a) through (h), properly declined to exercise jurisdiction over the issues concerning the defendant’s access to the children. Pelgrim v Pelgrim,2015 NY Slip Op 02738, 2nd Dept 4-1-15

 

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Plaintiff’s Allegations of Injuries in the Bill of Particulars Were Not So Broad as to Constitute a Waiver of the Physician-Patient Privilege for Plaintiff’s Entire Medical History

The Fourth Department determined plaintiff’s allegations of injuries in the bill of particulars was not so broad as to place plaintiff’s entire medical history in controversy:

In bringing the action, plaintiff waived the physician/patient privilege only with respect to the physical and mental conditions affirmatively placed in controversy” … . Indeed, that waiver ” does not permit wholesale discovery of information regarding [plaintiff’s] physical and mental condition’ ” … . Contrary to defendants’ contention, the allegations in the bill of particulars that plaintiff sustained “serious and permanent injuries, including: toxic keratitis; bilateral corneal abrasions; severe bilateral photophobia; impaired vision; decrease in vision; need for corneal transplants; loss of enjoyment of life; disability; and pain and suffering” “do not constitute such broad allegations of injury’ that they place plaintiff’s entire medical history in controversy” … . The court properly conducted an in camera review to redact irrelevant information …, and properly limited disclosure to the “conditions affirmatively placed in controversy” … . Reading v Fabiano, 2015 NY Slip Op 02634, 4th Dept 3-27-15

 

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Town, Not the Town Board, Was the Proper Party/Town Could Not Use Article 78/Declaratory Judgment to Enforce a Contract/Town Entitled to Specific Performance of Contract

The Fourth Department, in the context of an action by the town for specific performance of a contract with a volunteer fire department, determined: (1) the town, not the town board, was the proper party to bring the action; (2) the hybrid Article 78/declaratory judgment action could not be brought by the town to enforce a contract; (3) the action should have been brought as one seeking specific performance; (4) the town was entitled to specific performance of the contract:

…[T]he Town Board lacks capacity to bring this proceeding/action.  As “artificial creatures of statute,” governmental entities such as the Town Board “have neither an inherent nor a common-law right to sue. Rather, their right to sue, if it exists at all, must be derived from the relevant enabling legislation or some other concrete statutory predicate” … . Here, Town Law § 65 (1) provides in relevant part that “[a]ny action or special proceeding for or against a town, or for its benefit, . . . shall be in the name of the town,” and that “[t]he town board of any town may authorize and direct any town officer or officers to institute, defend or appear, in any action or legal proceeding, in the name of the town, as in its judgment may be necessary, for the benefit or protection of the town” … . Under the circumstances of this case, we exercise our power pursuant to CPLR 2001 to correct that irregularity and to amend the caption by substituting the Town for the Town Board, “on behalf of” the Town … . …

… [A]lthough a CPLR article 78 proceeding may be brought against public or private corporations that “take on a quasi-governmental status” …, such “a . . . proceeding is not the proper vehicle to resolve contractual rights’ ” … . Moreover, a declaratory judgment action is also not a proper vehicle to resolve the contractual rights herein because ” a full and adequate remedy is already provided by another well-known form of action’ ” … . Pursuant to CPLR 103 (c), however, “[i]f a court has obtained jurisdiction over the parties, a civil judicial proceeding shall not be dismissed solely because it is not brought in the proper form, but the court shall make whatever order is required for its proper prosecution.” We thus exercise our discretion under CPLR 103 (c) and convert this hybrid CPLR article 78 proceeding/declaratory judgment action to an action for specific performance … .

“Specific performance is a discretionary remedy which is an alternative to the award of damages as a means of enforcing the contract’ . . . The right to specific performance is not automatic . . . The equitable remedy of specific performance is available in the court’s discretion when the remedy at law is inadequate . . . Finally, . . . the party seeking equity must do equity, i.e., he must come into court with clean hands” … . Here, the Town met its burden of proving that it “substantially performed [its] contractual obligations . . . within the time specified in the [2011 Contract, and] that [it] is ready, willing and able to perform those contractual obligations not yet performed and not waived by the [West Brighton Fire Department (WBFD)]” …, and the WBFD failed to raise a triable issue of fact in opposition thereto … . Matter of Town Bd. of Town of Brighton v West Brighton Fire Dept., Inc., 2015 NY Slip Op 02581, Fourth Dept 3-27-15

 

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Felony Convictions in Other Jurisdictions Need Not Have a New-York-Felony Counterpart to Be Considered Under the Persistent Felony Offender Statute

The Court of Appeals, in a full-fledged opinion by Judge Read, determined the persistent-felony-offender statute does not require that felonies committed in other jurisdictions have a felony-counterpart in New York in order to be considered re:  persistent-felony-offender status:

New York’s persistent felony offender statute, by its plain terms, does not require that, in order to classify someone as a persistent felony offender, an out-of-state predicate felony must have a New York counterpart. Section 70.10’s silence with regard to New York equivalency is dispositive. As the Second Circuit explained in Griffin, when holding that section 70.10 was rational as applied to the defendant in that case, “[s]ection 70.10 (1) (b) does not distinguish among felony convictions that arise under federal, New York State, or out-of-state law. Thus, if the acts constitute a felony under federal or another state’s law, they will be deemed a felony for purposes of persistent offender status under [s]ection 70.10 even if there is no counterpart felony in New York law” (Griffin, 156 F3d at 290 [emphasis added]…). People v Jones, 2015 NY Slip Op 02553, CtApp 3-26-15

 

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Plaintiff’s Motion to Appoint a Temporary Administrator after Defendant’s Death Properly Denied—Relevant Law Explained

In affirming the denial of plaintiff’s motion to appoint a temporary administrator after the defendant in a lead-paint action had died, the Second Department explained the relevant law:

“If a party dies and the claim for or against him [or her] is not thereby extinguished the court shall order substitution of the proper parties” (CPLR 1015[a]…). “A motion for substitution may be made by the successors or representatives of a party or by any party” (CPLR 1021…). “Generally, the death of a party divests a court of jurisdiction to act, and automatically stays proceedings in the action pending the substitution of a personal representative for the decedent” … .

In most instances a personal representative appointed by the Surrogate’s Court should be substituted in the action to represent the decedent’s estate … . However, in the event no such representative exists, an appropriate appointment may be made by the Supreme Court and that individual may be substituted in place of the decedent … . Indeed, “[t]he Supreme Court is a court of general jurisdiction with the power to appoint a temporary administrator, and may do so to avoid delay and prejudice in a pending action” … . The determination of whether to exercise its authority to appoint a temporary administrator is committed to the sound discretion of the Supreme Court, and will not be disturbed by this Court so long as the determination does not constitute an improvident exercise of discretion … .

Under the circumstances of this case, the Supreme Court providently exercised its discretion in denying the plaintiff’s motion, inter alia, to appoint a temporary administrator (see CPLR 1015[a]…). Although in most instances the personal representative of the decedent’s estate should be substituted, here, the plaintiff failed to demonstrate what steps she had taken to secure the appointment of a personal representative in the appropriate Surrogate’s Court or that resort to the appropriate Surrogate’s Court was otherwise unfeasible … . Furthermore, the plaintiff did not contend that this action, which is based on events occurring nearly 20 years ago, was trial-ready … . Under the circumstances presented here, the plaintiff failed to adequately demonstrate why the appointment of a temporary administrator was needed to avoid undue delay and prejudice. Lambert v Estren, 2015 NY Slip Op 02454, 2nd Dept 3-25-15

 

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Referee’s Authority Exceeded—Authority Comes from Consent of the Parties

The Second Department determined the referee had exceeded his authority in a custody proceeding:

“A referee derives authority from an order of reference by the court (see CPLR 4311), which can be made only upon the consent of the parties, except in limited circumstances,” which are not applicable here … . Here, the parties did not consent to the determination of any issues by a referee, and the order of reference directed the referee to hear and report (see CPLR 4317[a]). Absent the parties’ consent, the referee had the power only to hear and report his findings (see CPLR 4317[a]…). Thus, the referee exceeded his authority in signing an order to show cause pursuant to which the defendant, in effect, sought leave to submit a motion to modify a prior order of custody and to stay the enforcement of an order entered in a related custody proceeding commenced in the Family Court, pending her appeal of that order. The referee further exceeded his authority in temporarily restraining the enforcement of the Family Court’s order and all proceedings in the Family Court pending the determination of that branch of the defendant’s motion which was for a stay … .  Albert v Albert, 2015 NY Slip Op 02439, 2nd Dept 3-25-15

 

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Summary Judgment May Be Based Upon an Unpled Affirmative Defense/Oral Waiver May Be Effective in the Face of a “Written Waiver” Requirement in the Contract

The First Department noted that a motion for summary judgment can be based upon an unpleaded affirmative defense in the absence of surprise and determined there was a question of fact whether an oral waiver was effective in the face of a contract provision requiring any waiver to be in writing:

Defendants’ failure to plead the affirmative defense of waiver in their answer did not preclude them from asserting such defense for the first time on summary judgment, since “[t]here is no prohibition against moving for summary judgment based on an unpleaded defense where the opposing party is not taken by surprise and does not suffer prejudice as a result” … . * * *

Although the management agreement contained a provision that any waivers must be in writing, “a contracting party may orally waive enforcement of a contract term notwithstanding a provision to the contrary in the agreement. Such waiver may be evinced by words or conduct, including partial performance”… . Matthew Adam Props., Inc. v The United House of Prayer for All People of the Church on the Rock of the Apostolic Faith, 2015 NY Slip Op 02419, 1st Dept 3-24-15

 

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County Must Seek a Medical Income Execution Order (to Pay for a Child’s Health Insurance) Where No Medical Income Execution Order Has Yet Been Issued in the Case

The Fourth Department determined petitioner-county must seek a judicial medical income execution order (to pay for a child’s health insurance) and cannot simply issue an income execution on its own where no medical income execution has previously been issued in the matter:

Petitioner contends that, pursuant to CPLR 5241 (b) (2) (ii), it may issue a medical income execution to a new employer of the parent without going to court, and it was therefore error for the Support Magistrate to include the provision that a medical income execution “shall not [be issued] without such Court Order.” We conclude that petitioner’s reliance on CPLR 5241 (b) (2) (ii) is misplaced. A plain reading of that statute shows that it is not applicable here because neither parent provided health insurance coverage for the child at the time the Support Magistrate issued the order. The statute specifically provides that, “where the [parent] provides such coverage and then changes employment,” an amended medical income execution may be issued by petitioner without returning to court (id. [emphasis added]). Inasmuch as there was no medical income execution that was issued in this case, there was nothing to “amend.” Contrary to petitioner’s further contention, a medical income execution can be issued only where a court has ordered a parent to provide health insurance benefits, and that has not occurred yet inasmuch as the Support Magistrate determined that such benefits are not available (see CPLR 5241 [b] [2] [i]…). Matter of Chautauqua County Dept. of Health & Human Servs. v Matteson, 2015 NY Slip Op 02259, 4th Dept 3-20-15

 

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Garage Not Used Exclusively for an Exempt Purpose Not Entitled to Tax Exemption/Supreme Court Should Not Have Deemed the “Statement of Undisputed Material Facts” to Have Been Admitted by the Respondent, Despite Respondent’s Failure to Provide a Paragraph by Paragraph Response As Required by the Rule

The Fourth Department determined that property (a parking garage) was not entitled to tax exempt status because it was not used exclusively for an exempt purpose, noting that parking for private-practice physician’s offices was not exempt (parking for a hospital is). The Fourth Department further held that the respondent city did not admit to the petitioner’s “Statement of Undisputed Material Facts,” even though the city did not submit a paragraph by paragraph response as required by the relevant Rule of the Commercial Division:

It is well settled that, pursuant to the RPTL, “[r]eal property owned by a corporation or association organized or conducted exclusively for . . . hospital . . . purposes . . . and used exclusively for carrying out thereupon . . . such purpose[] . . . shall be exempt from taxation” (RPTL 420-a [1] [a]). Here, respondents concede that petitioner is organized for an exempt purpose, as a hospital, and thus only the second prong of the statute is at issue. “[T]he test of entitlement to tax exemption under the used exclusively clause of [RPTL 420-a (1) (a)] is whether the particular use is reasonably incident[al] to the [primary or] major purpose of the [corporation] . . . Put differently, the determination of whether the property is used exclusively for the statutory purposes depends upon whether its primary use is in furtherance of the permitted purposes” … . “The burden of establishing that the property is entitled to a tax exemption rests with the taxpayer” … . Additionally, when a taxpayer in a tax certiorari proceeding seeks summary judgment, “it is necessary that the movant establish his cause of action or defense sufficiently to warrant the court as a matter of law in directing judgment in his favor . . . , and he must do so by tender of evidentiary proof in admissible form” … .

Here, we agree with respondents that petitioner failed to establish that the primary use of the subject parcels is for exempt purposes, and thus it failed to meet its burden on the motion. Indeed, the evidence submitted by petitioner in support of the motion established that an undetermined portion of the people who used the garage did so for purposes associated with nonexempt uses such as the adjacent private physicians’ offices. Inasmuch “[a]s the private practice of medicine by a hospital’s attending physicians is primarily a commercial enterprise, and such physicians’ offices are not entitled to a tax exemption under RPTL 420-a . . . , the parking spaces subleased to those offices cannot be said to so further the hospital’s purposes as to create an entitlement to an exemption” … . * * *

…[W]e conclude that the court abused its discretion in deeming respondents to have admitted all the information in petitioner’s “Statement of Undisputed Material Facts” submitted pursuant to Rule 19-a of the Rules of the Commercial Division of the Supreme Court ([hereafter, 19-a Statement] see 22 NYCRR 202.70 [g] [Rule 19-a (a)]). The 19-a Statement was merely an almost verbatim repetition of an affidavit submitted by one of petitioner’s employees in support of the motion, and respondents clearly disputed the content of the information in it. Further, petitioner failed to submit sufficient evidence in admissible form in support of the 19-a Statement, as required by the Rule (see 22 NYCRR 202.70 [g] [Rule 19-a (d)]; …). Although “the rule gives a motion court the discretion to deem facts admitted, the court is not required to do so” … . Consequently, although “it would have been better for [respondents] to submit a paragraph-by-paragraph response to [petitioner’s] statement” as required by the regulation (… see 22 NYCRR 202.70 [g] [Rule 19-a (b)]), under the circumstances the court abused its discretion in deeming the entire statement admitted. The evidence submitted in support of petitioner’s motion failed to eliminate all “triable issues of fact and the court was not compelled to grant summary judgment solely on the basis of blind adherence to the procedure set forth in Rule 19-a” … . Matter of Crouse Health Sys., Inc. v City of Syracuse, 2015 NY Slip Op 02258, 4th Dept 3-20-15

 

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