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Adjournment Which Would Not Affect Trial Date Should Have Been Granted

The First Department determined Supreme Court should not have denied a request for a one-day adjournment to conduct an independent medical examination (IME):

The court improvidently exercised its discretion by denying defendants a one-day adjournment to conduct the already scheduled IME, as there is no evidence that the failure to conduct it previously was willful, and no evidence that plaintiff would have been prejudiced by the delay …. Moreover, the court could have allowed the IME without vacating the note of issue…, thereby causing no delay in the trial. …  Pickering v Union 15 Rest Corp, 2013 NY Slip Op 04122, 1st Dept, 6-6-13

 

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“Crime-Fraud” Exception to Attorney-Client Privilege Re: Studies Funded by Defendant Casting Doubt on Relationship Between Asbestos and Cancer

In a full-fledged opinion by Justice Andrias, the First Department determined plaintiffs, as part of discovery in this asbestos litigation, were entitled to an in camera review of defendant’s internal communications and to the data underlying published research studies funded by the defendant. The studies purported to cast doubt on whether chrysotile asbestos caused cancer.  In the course of the opinion, the First Department explained the “crime-fraud” exception to the attorney-client privilege (the basis of the request for in camera review of defendant’s internal communications):

The motion court providently exercised its broad discretion …when it  …granted in camera review of the documents to determine whether the crime-fraud exception to the attorney-client privilege applied … .

The crime-fraud exception encompasses ” a fraudulent scheme, an alleged breach of fiduciary duty or an accusation of some other wrongful conduct'”…. “[A]dvice in furtherance of a fraudulent or unlawful goal cannot be considered sound.’ Rather advice in furtherance of such goals is socially perverse, and the client’s communications seeking such advice are not worthy of protection”….

A party seeking “to invoke the crime-fraud exception must demonstrate that there is a factual basis for a showing of probable cause to believe that a fraud or crime has been committed and that the communications in question were in furtherance of the fraud or crime” … .However, “[a] lesser evidentiary showing is needed to trigger in camera review than is required ultimately to overcome the privilege”… .

To permit in camera review of the documents to analyze whether the communications were used in furtherance of such wrongful activity, there need only be “a showing of a factual basis adequate to support a good faith belief by a reasonable person that in camera review of the materials may reveal evidence to establish the claim that the crime-fraud exception applies” …. “Once that showing is made, the decision whether to engage in in camera review of the evidence rests in the sound discretion of the [] court” …. Matter of New York City Asbestos Litig, 2013 NY Slip Op 04127, 1st Dept, 6-6-13

 

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30-Day Time-Limit for Bringing Article 78 Proceeding Pursuant to Public Health Law Runs from Date of Determination, Not Date of Written Notice of Determination

The Third Department upheld the Appalachian Regional Emergency Medical Services Council’s determination that petitioner’s Article 78 action was untimely. Although the proceeding was brought within 30 days of the written notice of the Council’s determination, and the Council had a policy of issuing written notice, the Third Department determined the 30 day time-limit started when the determination was made, not when written notice was received:

Public Health Law  §  3008  (5) requires that an appeal be taken within 30 days of when a regional council makes its determination, and there is no statutory requirement that the determination be  in writing (see Public Health Law § 3008 [4]… .  Matter of Richmondville Volunteer Emergency Squad, Inc v NYS Department of Health…, 515688, 3rd Dept, 6-6-13

 

Nature of Motion to Resettle Explained

In dismissing the appeal from the denial of a motion to resettle or clarify, the Third Department explained the nature of a motion to resettle and some aspects of motions to reargue and renew:

Petitioner’s motion was one to resettle and/or clarify Supreme Court’s prior judgment regarding back pay. Such a motion is designed “not for substantive changes [in, or to amplify a prior decision of, the court], but to correct errors or omissions in form, for clarification or to make the [judgment] conform more accurately to the decision” … .  Such  motions  rest on  the inherent power  of courts to  “‘cure mistakes,  defects  and  irregularities that  do  not  affect substantial rights of [the] parties'” Here, petitioners’ motion  sought, unsuccessfully, to amplify and substantively amend, not merely to clarify, Supreme Court’s prior judgment  … Under established precedent, no appeal lies from the “‘denial of a motion to resettle [or clarify] a substantive portion of an order'” … .Moreover, even were we to view petitioners’ motion as one to reargue, which Supreme Court indicated would have been untimely (see CPLR 2221 [d] [3]), the motion was not “identified specifically as such” (CPLR  2221  [d] [1]), as required, and, in any event, no appeal lies from the denial of a motion to reargue ….  The motion likewise was not denominated as one seeking renewal (see CPLR 2221 [e] [1]) and was not based upon “new facts” or “a change in the law” (CPLR 2221 [e] [2]).  Accordingly, the appeal must be dismissed.  Matter of Torpey v Town of Colonie, 515902, 3rd Dept, 6-6-13

 

Certification Order Requiring Filing of Note of Issue in 70, Rather than 90, Days Could Not Be Basis of Dismissal

The Second Department determined that a certification order which required a note of issue be filed within 70 days, rather than 90 days, could not be the basis for dismissal of the action:

The certification order dated March 2, 2010, did not constitute a valid 90-day demand pursuant to CPLR 3216 because it directed the plaintiff to file a note of issue within 70 days, rather than 90 days, of the date of the order. Since the order failed to conform with a statutorily mandated condition precedent to dismissal of the action, the Supreme Court was not authorized to dismiss the action pursuant to CPLR 3216… . Although the plaintiff raises this issue for the first time on appeal, it involves a question of law that appears on the face of the record, and could not have been avoided if brought to the attention of the Supreme Court… . Gu v Hatsis, 2013 NY Slip Op 03970, 2nd Dept, 6-5-13

 

Note of Issue Which States Discovery Not Complete Is a Nullity

The Second Department determined a note of issue which indicates discovery is not complete is 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 (see 22 NYCRR 202.21[a], [b]). While the filing of a note of issue within 90 days after service upon the plaintiff of a written demand to serve and file the note of issue precludes a court from dismissing the action …, here, the plaintiffs’ certificate of readiness stated, inter alia, that discovery proceedings now known to be necessary were not 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, and that branch of the appellant’s motion which was to vacate the note of issue was properly granted… .  Furrukh v Forest Hills Hosp, 2013 NY Slip Op 03968, 2nd Dept, 6-5-13

 

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Failure to Allege Specific Facts to Rebut Process Server Affidavit Required Denial of Motion to Vacate Judgment w/o Hearing

The Second Department upheld Supreme Court’s denial of a motion to vacate a judgment on the ground defendant was not served.  No hearing was necessary because defendant did not swear to specific facts to rebut the facts in the process server’s affidavit:

“Although a defendant’s sworn denial of receipt of service generally rebuts the presumption of proper service established by the process server’s affidavit and necessitates an evidentiary hearing, no hearing is required where the defendant fails to swear to specific facts to rebut the statements in the process server’s affidavits'”…. Since the appellant never denied the specific facts contained in the process server’s affidavit, no hearing was required… .  Bank of NY v Samuels, 2013 NY Slip Op 03958, 2nd Dept, 6-5-13

 

Forum Non Conveniens Doctrine Applied

In affirming the dismissal of the action on forum non conveniens grounds, the First Department described the criteria and relevant facts as follows:

The doctrine of forum non conveniens, as codified under CPLR 327, permits a court to stay or dismiss an action “where it is determined that the action, although jurisdictionally sound, would be better adjudicated elsewhere” …. The doctrine rests on considerations of justice, fairness and convenience … . * * *

The subject matter of this action – insurance coverage for liability relating to the manufacture of products in Massachusetts – has no substantial connection to New York. When the policies were issued, Warren was a Massachusetts corporation and had its principal place of business in that state. Liberty Mutual, the insurer under the policies at issue, is a Massachusetts corporation that has its principal place of business in that state. Both plaintiffs are foreign corporations that maintain their principal places of business in other states… . Century Indem Co v Liberty Mut Ins Co, 2013 NY Slip Op 03953, 1st Dept, 6-4-13

 

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Appellate Court Can Grant Summary Judgment to Nonappealing Party

In the course of a decision awarding partial summary judgment to the defendant, the Third Department noted that “this Court has the authority to grant summary judgment to a nonappealing party” and did so with regard to a nonappealing defendant as well.  Shree Shiv Shakti Corp… v Khalid Properties, LLC, 515810, 3rd Dept 5-30-13

 

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Statute of Limitations for Fraud Applies to Forgery​

The Second Department noted that the statute of limitations provisions for fraud are applied to forgery:

Contrary to the plaintiff’s contention, the statute of limitations for a fraud cause of action applies to a cause of action alleging forgery … .The statute of limitations for a fraud-based cause of action requires that the action be commenced within six years after the allegedly fraudulent act or within two years after discovery, whichever is later….   Faison v Lewis, 2013 NY Slip OP 03813, 2nd Dept, 5-29-13

 

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