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STATEMENTS BY SHOOTING VICTIM SHOULD NOT HAVE BEEN ADMITTED AS DYING DECLARATIONS BECAUSE THEY REFLECTED SPECULATION, NOT FACTS; WHETHER STATEMENTS ARE DYING DECLARATIONS IS NOT A JURY QUESTION.

The First Department, reversing defendants’ convictions, determined statements made by the shooting victim should not have been admitted as dying declarations because the statements reflected speculation, not facts. Whether the statements were admissible as dying declarations was not a question of fact for the jury. The defendants were not present at the shooting. The prosecution was based upon the theory the defendants hired the shooter:

… [W]e reverse the judgments and order a new trial because the court erred in admitting, as dying declarations, the victim’s statements implicating defendants, since they were his “mere expression of belief and suspici[ons]” that defendants were involved in his shooting rather than “statements of facts to which a living witness would have been permitted to testify, if placed upon the stand” … . Although the dying declarant may accuse his or her killer in conclusory language, “[t]he declaration is kept out if the setting of the occasion satisfies the judge, or in reason ought to satisfy him [or her], that the speaker is giving expression to suspicion or conjecture, and not to known facts” … .

… Contrary to the People’s argument, the question of what the victim was referring to when he implicated these defendants was not a proper jury question, nor did the lack of specificity merely go to the weight to be accorded this evidence.

The admission of the statements, which was over defendants’ timely and specific objection, was not harmless. Although some facts that may have led the victim to suspect that defendants were involved in his murder were part of the trial evidence, there was nothing to prevent the jury from speculating that the victim was privy to other information, outside the record, connecting defendants to the crime. We also note that the jury, which issued several deadlock notes during its very lengthy deliberations, twice requested to hear the dying declaration evidence. People v Gumbs, 2016 NY Slip Op 06424, 1st Dept 10-4-16

CRIMINAL LAW (STATEMENTS BY SHOOTING VICTIM SHOULD NOT HAVE BEEN ADMITTED AS DYING DECLARATIONS BECAUSE THEY REFLECTED SPECULATION, NOT FACTS; WHETHER STATEMENTS ARE DYING DECLARATIONS IS NOT A JURY QUESTION)/EVIDENCE (CRIMINAL LAW, STATEMENTS BY SHOOTING VICTIM SHOULD NOT HAVE BEEN ADMITTED AS DYING DECLARATIONS BECAUSE THEY REFLECTED SPECULATION, NOT FACTS; WHETHER STATEMENTS ARE DYING DECLARATIONS IS NOT A JURY QUESTION)/DYING DECLARATIONS (CRIMINAL LAW, (STATEMENTS BY SHOOTING VICTIM SHOULD NOT HAVE BEEN ADMITTED AS DYING DECLARATIONS BECAUSE THEY REFLECTED SPECULATION, NOT FACTS; WHETHER STATEMENTS ARE DYING DECLARATIONS IS NOT A JURY QUESTION)

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HEARING ON MOTION TO VACATE CONVICTION REQUIRED TO DETERMINE THE CREDIBILITY OF DEFENDANT’S CLAIM HE WOULD HAVE REJECTED THE PLEA BARGAIN HAD HE KNOWN OF THE RISK OF DEPORTATION.

The First Department determined defendant’s motion to vacate his conviction (by guilty plea), based upon defense counsel’s failure to advise defendant of the possibility of deportation, should not have been denied without a hearing. The decision includes a concise yet complete summary of the federal and state criteria for ineffective assistance and the burdens of proof re: a motion to vacate a conviction by plea. The court noted that credibility questions, here whether defendant’s claim he would have rejected the plea had he known of the risk of deportation, can only be resolved by a hearing:

The issue before us thus turns on whether counsel’s lack of advice on the deportation consequences of defendant’s guilty plea resulted in sufficient prejudice to warrant the withdrawal of his guilty plea. In order to prevail, a defendant must demonstrate a “reasonable probability that, [had counsel properly advised him of the implication of his plea on his immigration status], he would not have pleaded guilty and would have insisted on going to trial” … . … [D]efendant alleges that he would have gone to trial, despite its hazards and the potentially significant incarceration that a conviction would entail, had he been advised he would be deported. Although to have done so would have meant the rejection of “the very beneficial deal” his counsel had negotiated, the motion court erred in finding that defendant’s claim was not “credible,” given the length of time defendant resided legally in the United States, and the other factors raised in his motion papers. Such credibility determinations should be made only after a hearing … . People v Samuels, 2016 NY Slip Op 06423, 1st Dept 10-4-16

CRIMINAL LAW (HEARING ON MOTION TO VACATE CONVICTION REQUIRED TO DETERMINE THE CREDIBILITY OF DEFENDANT’S CLAIM HE WOULD HAVE REJECTED THE PLEA BARGAIN HAD HE KNOWN OF THE RISK OF DEPORTATION)/ATTORNEYS (INEFFECTIVE ASSISTANCE, HEARING ON MOTION TO VACATE CONVICTION REQUIRED TO DETERMINE THE CREDIBILITY OF DEFENDANT’S CLAIM HE WOULD HAVE REJECTED THE PLEA BARGAIN HAD HE KNOWN OF THE RISK OF DEPORTATION)/INEFFECTIVE ASSISTANCE (HEARING ON MOTION TO VACATE CONVICTION REQUIRED TO DETERMINE THE CREDIBILITY OF DEFENDANT’S CLAIM HE WOULD HAVE REJECTED THE PLEA BARGAIN HAD HE KNOWN OF THE RISK OF DEPORTATION)/EVIDENCE (CRIMINAL LAW, MOTION TO VACATE CONVICTION, HEARING ON MOTION TO VACATE CONVICTION REQUIRED TO DETERMINE THE CREDIBILITY OF DEFENDANT’S CLAIM HE WOULD HAVE REJECTED THE PLEA BARGAIN HAD HE KNOWN OF THE RISK OF DEPORTATION)/VACATE CONVICTION, MOTION TO (HEARING ON MOTION TO VACATE CONVICTION REQUIRED TO DETERMINE THE CREDIBILITY OF DEFENDANT’S CLAIM HE WOULD HAVE REJECTED THE PLEA BARGAIN HAD HE KNOWN OF THE RISK OF DEPORTATION)

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EXPERT’S INABILITY TO QUANTIFY THE EXTENT TO WHICH DEFENDANTS’ CONDUCT DIMINISHED PLAINTIFF’S DECEDENT’S CHANCE OF A BETTER OUTCOME DID NOT JUSTIFY GRANTING DEFENDANTS’ MOTION FOR A JUDGMENT AS A MATTER OF LAW.

The Fourth Department, reversing Supreme Court, determined defendants’ motion for a judgment as a matter of law (on the issue of causation) should not have been granted. Plaintiff alleged the delay in diagnosing or failure to diagnose plaintiff’s decedent’s condition diminished plaintiff’s decedent’s chance of a better outcome. Plaintiff’s expert’s inability to quantify the extent to which defendants’ conduct diminished the chance of a better outcome did not render the proof insufficient:

In order to 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” (PJI 2:70…). Where, as here, the plaintiff alleges that the defendant negligently failed or delayed in diagnosing and treating a condition, a finding that the negligence was a proximate cause of an injury to the patient may be predicated on the theory that the defendant thereby “diminished [the patient’s] chance of a better outcome,” in this case, survival … . In that instance, the plaintiff must present evidence from which a rational jury could infer that there was a “substantial possibility” that the patient was denied a chance of the better outcome as a result of the defendant’s deviation from the standard of care … . However, “[a] plaintiff’s evidence of proximate cause may be found legally sufficient even if his or her expert is unable to quantify the extent to which the defendant’s act or omission decreased the [patient’s] chance of a better outcome . . . , as long as evidence is presented from which the jury may infer that the defendant’s conduct diminished the [patient’s] chance of a better outcome’ … . Clune v Moore, 2016 NY Slip Op 06331, 4th Dept 9-30-16

 

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NO FOUNDATION FOR RECANTATION EVIDENCE COULD BE LAID BECAUSE THE ALLEGED VICTIM REFUSED TO TESTIFY; TRIAL COURT SHOULD NOT HAVE ALLOWED VICTIM’S TESTIMONY FROM THE FIRST TRIAL TO BE ADMITTED WITHOUT EXPLORING WHETHER THE TESTIMONY SHOULD BE STRUCK BECAUSE IT WAS CENTRAL TO THE PROSECUTION’S CASE; TRIAL COURT ACTED VINDICTIVELY BY IMPOSING A HARSHER SENTENCE AFTER RETRIAL.

The Fourth Department, reversing defendant’s conviction, determined that allowing the alleged victim’s testimony from the first trial to be read into evidence in the second trial violated the defendant’s right to confrontation. After the first trial, the victim recanted and told defense counsel and the prosecutor someone else committed the offense. At defendant’s second trial, the victim refused to testify, exercising her 5th amendment right to remain silent. Because the victim could not be asked about her recantation, and therefore no foundation for the recantation evidence could be laid, the victim’s testimony from the first trial was deemed admissible. However, under the facts, the victim’s assertion of her 5th amendment rights required the trial judge to explore whether her testimony in the first trial should be struck because her testimony was central to the prosecution’s case. In addition, the Fourth Department determined the trial judge acted vindictively when a greater sentence was imposed after the second trial:

… [The defendant’s] Sixth Amendment right to confrontation was violated when the victim exercised her Fifth Amendment right to remain silent and refused to answer defense counsel’s questions regarding the recantation of her testimony because the court failed in its duty “[to] explore whether [she] ha[d] essentially refused to testify on questions of matters so closely related to the commission of the crime[s] that [some or all of her] testimony . . . [from the first trial] should be stricken” … . We note, too, that the victim’s testimony is central to the People’s case … and, given that we have previously determined that the evidence against defendant is “less than overwhelming” … , we cannot conclude that the court’s error is harmless … .

We therefore reverse the judgment and grant a new trial on counts one, two and four of the indictment. In the interest of judicial economy, we exercise our power to review as a matter of discretion in the interest of justice defendant’s contention that the court failed to rebut the presumption of vindictiveness when it imposed a greater sentence than was imposed following the first trial … . The People correctly concede that the court failed to identify ” conduct on the part of the defendant occurring after the time of the original sentencing proceeding’ ” to justify an increased sentence … , and thus we conclude that the court erred in increasing the sentence after the retrial … . People v Hicks, 2016 NY Slip Op 06334, 4th Dept 9-30-16

 

CRIMINAL LAW (NO FOUNDATION FOR RECANTATION EVIDENCE COULD BE LAID BECAUSE THE ALLEGED VICTIM REFUSED TO TESTIFY; TRIAL COURT SHOULD NOT HAVE ALLOWED VICTIM’S TESTIMONY FROM THE FIRST TRIAL TO BE ADMITTED WITHOUT EXPLORING WHETHER THE TESTIMONY SHOULD BE STRUCK BECAUSE IT WAS CENTRAL TO THE PROSECUTION’S CASE; TRIAL COURT ACTED VINDICTIVELY BY IMPOSING A HARSHER SENTENCE AFTER RETRIAL)/EVIDENCE (CRIMINAL LAW, NO FOUNDATION FOR RECANTATION EVIDENCE COULD BE LAID BECAUSE THE ALLEGED VICTIM REFUSED TO TESTIFY; TRIAL COURT SHOULD NOT HAVE ALLOWED VICTIM’S TESTIMONY FROM THE FIRST TRIAL TO BE ADMITTED WITHOUT EXPLORING WHETHER THE TESTIMONY SHOULD BE STRUCK BECAUSE IT WAS CENTRAL TO THE PROSECUTION’S CASE; TRIAL COURT ACTED VINDICTIVELY BY IMPOSING A HARSHER SENTENCE AFTER RETRIAL)/RECANTATION (CRIMINAL LAW, NO FOUNDATION FOR RECANTATION EVIDENCE COULD BE LAID BECAUSE THE ALLEGED VICTIM REFUSED TO TESTIFY; TRIAL COURT SHOULD NOT HAVE ALLOWED VICTIM’S TESTIMONY FROM THE FIRST TRIAL TO BE ADMITTED WITHOUT EXPLORING WHETHER THE TESTIMONY SHOULD BE STRUCK BECAUSE IT WAS CENTRAL TO THE PROSECUTION’S CASE; TRIAL COURT ACTED VINDICTIVELY BY IMPOSING A HARSHER SENTENCE AFTER RETRIAL)/SENTENCING (TRIAL COURT ACTED VINDICTIVELY BY IMPOSING A HARSHER SENTENCE AFTER RETRIAL)

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EVIDENCE SEIZED FROM DEFENDANT’S PERSON BEFORE THERE WAS PROBABLE CAUSE TO ARREST SHOULD HAVE BEEN SUPPRESSED; HOWEVER EVIDENCE COLLECTED AFTER THERE WAS PROBABLE CAUSE WAS NOT THE FRUIT OF THE POISONOUS TREE.

The Fourth Department determined items seized from defendant’s person at the time he was detained should have been suppressed. However, a subsequent show-up identification, statements, and items found where defendant was initially seized were not fruit of the poisonous tree:

Defendant contends that he was unlawfully arrested prior to the showup identification procedure and that all of the physical evidence, as well as the identification testimony and his statements, must be suppressed as fruit of the poisonous tree. We agree with defendant that the items seized from his person should have been suppressed because the police did not have probable cause at that time to arrest him and conduct a search incident to an arrest. We conclude that the police had reasonable suspicion to pursue defendant and detain him for the purpose of the showup identification … . But although the police were permitted at that time to conduct a pat frisk of defendant … , they were not permitted to search him.

We reject defendant’s contention, however, insofar as he asserts that the remaining evidence must be suppressed as fruit of the poisonous tree. It is well settled that “only evidence which is the fruit of the poisonous tree’ should be excluded” … . In other words, “only evidence which has been come at by exploitation of that illegality should be suppressed” … . Here, defendant did not meet his burden of establishing that the showup identification of him, his statements to the police, and the items seized in the courtyard, were causally related to his unlawful arrest prior to the showup identification procedure … , i.e., that such evidence was ” obtained by exploitation’ ” of the illegal arrest … . People v Ashford, 2016 NY Slip Op 06365, 4th Dept 9-30-16

 

CRIMINAL LAW (EVIDENCE SEIZED FROM DEFENDANT’S PERSON BEFORE THERE WAS PROBABLE CAUSE TO ARREST SHOULD HAVE BEEN SUPPRESSED; HOWEVER EVIDENCE COLLECTED AFTER THERE WAS PROBABLE CAUSE WAS NOT THE FRUIT OF THE POISONOUS TREE)/EVIDENCE (CRIMINAL LAW, EVIDENCE SEIZED FROM DEFENDANT’S PERSON BEFORE THERE WAS PROBABLE CAUSE TO ARREST SHOULD HAVE BEEN SUPPRESSED; HOWEVER EVIDENCE COLLECTED AFTER THERE WAS PROBABLE CAUSE WAS NOT THE FRUIT OF THE POISONOUS TREE)/SUPPRESSION (CRIMINAL LAW, EVIDENCE SEIZED FROM DEFENDANT’S PERSON BEFORE THERE WAS PROBABLE CAUSE TO ARREST SHOULD HAVE BEEN SUPPRESSED; HOWEVER EVIDENCE COLLECTED AFTER THERE WAS PROBABLE CAUSE WAS NOT THE FRUIT OF THE POISONOUS TREE)

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CONSCIOUS PAIN AND SUFFERING CAUSE OF ACTION SHOULD NOT HAVE BEEN DISMISSED, EXPERT OPINION EVIDENCE SHOULD NOT HAVE BEEN ACCORDED ANY PROBATIVE FORCE.

The Second Department, in this wrongful death case, determined the defendant’s motion for summary judgment dismissing the cause of action for damages for conscious pain and suffering should not have been granted. The physician’s (Yong-Myun Rho’s) letter did not demonstrate relevant expertise and was conclusory and speculative:

The letter did not set forth what skill, training, knowledge, or experience Yong-Myun Rho had in the relevant areas of medicine so as to ensure the reliability of the opinion regarding the decedent’s time of death and whether the decedent suffered conscious pain before her death.

Further, the opinion of Yong-Myun Rho was conclusory and speculative and, thus, should have been accorded no probative force … . Essentially, based on the “findings” that the decedent had no vital sign when brought to the hospital, that there were open skull fractures showing the contused and lacerated brain tissue, and that the hospital certified the decedent’s death as traumatic cardiac arrest, Yong-Myun Rho opined that the decedent died immediately after the collision due to severe brain injury, and that she did not suffer any conscious pain before her death. Yong-Myun Rho added that the brain was the “essential organ that feels the pain.” Yong-Myun Rho did not adequately explain how these findings led to the conclusion that the decedent died immediately after the collision and did not suffer conscious pain before her death. Mazella v Hauser, 2016 NY Slip Op 06066, 2nd Dept 9-21-16

 

NEGLIGENCE (WRONGFUL DEATH, CONSCIOUS PAIN AND SUFFERING CAUSE OF ACTION SHOULD NOT HAVE BEEN DISMISSED, EXPERT OPINION EVIDENCE SHOULD NOT HAVE BEEN ACCORDED ANY PROBATIVE FORCE)/EVIDENCE (WRONGFUL DEATH, CONSCIOUS PAIN AND SUFFERING CAUSE OF ACTION SHOULD NOT HAVE BEEN DISMISSED, EXPERT OPINION EVIDENCE SHOULD NOT HAVE BEEN ACCORDED ANY PROBATIVE FORCE)/EXPERT OPINION EVIDENCE (WRONGFUL DEATH, CONSCIOUS PAIN AND SUFFERING CAUSE OF ACTION SHOULD NOT HAVE BEEN DISMISSED, EXPERT OPINION EVIDENCE SHOULD NOT HAVE BEEN ACCORDED ANY PROBATIVE FORCE)/WRONGFUL DEATH (CONSCIOUS PAIN AND SUFFERING CAUSE OF ACTION SHOULD NOT HAVE BEEN DISMISSED, EXPERT OPINION EVIDENCE SHOULD NOT HAVE BEEN ACCORDED ANY PROBATIVE FORCE)CONSCIOUS PAIN AND SUFFERING (WRONGFUL DEATH, CONSCIOUS PAIN AND SUFFERING CAUSE OF ACTION SHOULD NOT HAVE BEEN DISMISSED, EXPERT OPINION EVIDENCE SHOULD NOT HAVE BEEN ACCORDED ANY PROBATIVE FORCE)

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FOUNDATION REQUIREMENTS FOR BUSINESS RECORDS EXCEPTION TO THE HEARSAY RULE NOT MET. BANK’S SUMMARY JUDGMENT MOTION SHOULD NOT HAVE BEEN GRANTED.

The Second Department determined the plaintiff bank failed to satisfy the foundation for the business records exception to the hearsay rule. The bank’s motion for summary judgment should have been denied. Although the affiant (Roesner) stated he was familiar with the successor-in-interest’s record keeping system, he did not allege he was familiar with the plaintiff bank’s record keeping practices and procedures:

Roesner averred, inter alia, that his knowledge of the relevant facts was based on his “examination of the financial books and business records made in the ordinary course of business maintained by or on behalf of the successor in interest to the Plaintiff,” and that he was “familiar with the record keeping systems that [the] successor in interest to the Plaintiff and/or its loan servicer use[d] to record and create information related to the residential mortgage loans that it services.” …

* * * On its motion for summary judgment, a plaintiff has the burden of establishing, by proof in admissible form, its prima facie entitlement to judgment as a matter of law … .

The plaintiff failed to demonstrate the admissibility of the records relied upon by Roesner under the business records exception to the hearsay rule (see CPLR 4518[a]), and, thus, failed to establish the appellant’s default in payment under the note. “A proper foundation for the admission of a business record must be provided by someone with personal knowledge of the maker’s business practices and procedures”… . Roesner, who was employed by the loan servicer …, did not allege that he was personally familiar with the plaintiff’s record keeping practices and procedures. Thus, Roesner failed to lay a proper foundation for the admission of records concerning the appellant’s payment history… . HSBC Mtge. Servs., Inc. v Royal, 2016 NY Slip Op 05973, 2nd Dept 9-14-16

 

FORECLOSURE (FOUNDATION REQUIREMENTS FOR BUSINESS RECORDS EXCEPTION TO THE HEARSAY RULE NOT MET. BANK’S SUMMARY JUDGMENT MOTION SHOULD NOT HAVE BEEN GRANTED)/EVIDENCE (FORECLOSURE. FOUNDATION REQUIREMENTS FOR BUSINESS RECORDS EXCEPTION TO THE HEARSAY RULE NOT MET. BANK’S SUMMARY JUDGMENT MOTION SHOULD NOT HAVE BEEN GRANTED)/BUSINESS RECORDS EXCEPTION TO HEARSAY RULE, (FORECLOSURE. FOUNDATION REQUIREMENTS FOR BUSINESS RECORDS EXCEPTION TO THE HEARSAY RULE NOT MET. BANK’S SUMMARY JUDGMENT MOTION SHOULD NOT HAVE BEEN GRANTED)

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FAILURE TO PRESERVE VIDEO OF UNDERLYING INCIDENT DID NOT WARRANT STRIKING THE ANSWER.

The Second Department, modifying Supreme Court, determined striking the answer was too severe a sanction for failure to preserve a video of the underlying incident (spoliation). The court noted that the plaintiff could still prove his case without the video recording. Therefore, an adverse inference jury instruction was an appropriate sanction:

“Under the common-law doctrine of spoliation, a party may be sanctioned where it negligently loses or intentionally destroys key evidence” … . “The party requesting sanctions for spoliation has the burden of demonstrating that a litigant intentionally or negligently disposed of critical evidence, and fatally compromised its ability to'” prove its claim or defense … . However, ” striking a pleading is a drastic sanction to impose in the absence of willful or contumacious conduct'” and, thus, the courts must ” consider the prejudice that resulted from the spoliation to determine whether such drastic relief is necessary as a matter of fundamental fairness'” … . “When the moving party is still able to establish or defend a case, a less severe sanction is appropriate” … . Peters v Hernandez, 2016 NY Slip Op 05983, 2nd Dept 9-14-16

CIVIL PROCEDURE (FAILURE TO PRESERVE VIDEO OF UNDERLYING INCIDENT DID NOT WARRANT STRIKING THE ANSWER)/EVIDENCE (SPOLIATION, FAILURE TO PRESERVE VIDEO OF UNDERLYING INCIDENT DID NOT WARRANT STRIKING THE ANSWER)/SPOLIATION (FAILURE TO PRESERVE VIDEO OF UNDERLYING INCIDENT DID NOT WARRANT STRIKING THE ANSWER)

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SUMMARY JUDGMENT CANNOT REST ON GAPS IN THE OPPOSING PARTY’S PAPERS; MOVING PARTY MUST ADDRESS EVERY NECESSARY ELEMENT WITH SUBSTANTIVE PROOF.

The Second Department, in a dispute among business partners, determined certain motions for summary judgment should not have been granted. The court explained that summary judgment cannot rest on gaps in the opposing party’s proof. A defendant bringing the motion must make out a prima facie case by addressing every issue raised in the pleadings. Where every issue is not addressed with substantive proof, the motion must be denied without reference to the opposing papers:

“[T]he prima facie showing which a defendant must make on a motion for summary judgment is governed by the allegations of liability made by the plaintiff in the pleadings” … . In this case, the individual defendants failed to affirmatively demonstrate, prima facie, that they did not breach any fiduciary duty owed to the plaintiffs during the course of all of the transactions or occurrences described in the amended complaint … . Similarly, the individual defendants failed to affirmatively establish, prima facie, that the plaintiffs did not sustain any damages as a result of their alleged misconduct … .

Furthermore, the submissions of the individual defendants were insufficient to establish, prima facie, that the application of the business judgment rule protected all of the transactions or occurrences described in the amended complaint from judicial scrutiny. * * * The individual defendants’ representations that all of the challenged conduct outlined in the amended complaint was performed in furtherance of the Partnership’s legitimate interests were conclusory, unsubstantiated, and, without more, amounted to bare legal conclusions that were insufficient to establish that the business judgment rule barred judicial inquiry into these matters … . Katz v Beil, 2016 NY Slip Op 05977, 2nd Dept 9-14-16

 

CIVIL PROCEDURE (SUMMARY JUDGMENT, EVIDENCE, SUMMARY JUDGMENT CANNOT REST ON GAPS IN THE OPPOSING PARTY’S PAPERS; MOVING PARTY MUST ADDRESS EVERY NECESSARY ELEMENT WITH SUBSTANTIVE PROOF)/EVIDENCE (SUMMARY JUDGMENT, SUMMARY JUDGMENT CANNOT REST ON GAPS IN THE OPPOSING PARTY’S PAPERS; MOVING PARTY MUST ADDRESS EVERY NECESSARY ELEMENT WITH SUBSTANTIVE PROOF)/SUMMARY JUDGMENT (SUMMARY JUDGMENT CANNOT REST ON GAPS IN THE OPPOSING PARTY’S PAPERS; MOVING PARTY MUST ADDRESS EVERY NECESSARY ELEMENT WITH SUBSTANTIVE PROOF)

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HOMEOWNERS ASSOCIATION’S EXERCISE OF RIGHT OF FIRST REFUSAL PROPER UNDER THE BUSINESS JUDGMENT RULE.

The Second Department determined Supreme Court properly rejected plaintiffs’ challenge of defendant homeowners association’s exercise of a right of first refusal. Plaintiffs had entered a purchase contract for a home within the association, but, pursuant the provisions of the purchase contract and the association’s declaration and restrictive covenants (Declaration), the association purchased the property. Applying the business judgment rule, the Second Department held the association had the authority to purchase the home:

In reviewing the actions of a homeowners’ association, a court should apply the business judgment rule and should limit its inquiry to whether the action was authorized and whether it was taken in good faith and in furtherance of the legitimate interests of the association … . The business judgment doctrine does not apply when a board acts outside the scope of its authority … . * * *

The contract … specifically provided that the purchaser acknowledged that the transaction was subject to the waiver, or deemed waiver, of the right of first refusal held by the Association as set forth in the Declaration. Further, the Board, on behalf of the Association, exercised the right of first refusal within the time period set forth in the Declaration. 19 Pond, Inc. v Goldens Bridge Community Assn., Inc., 2016 NY Slip Op 05979, 2nd Dept 9-14-16

REAL ESTATE (HOMEOWNERS ASSOCIATION’S EXERCISE OF RIGHT OF FIRST REFUSAL PROPER UNDER THE BUSINESS JUDGMENT RULE)/EVIDENCE (HOMEOWNERS ASSOCIATION’S EXERCISE OF RIGHT OF FIRST REFUSAL PROPER UNDER THE BUSINESS JUDGMENT RULE)/BUSINESS JUDGMENT RULE (HOMEOWNERS ASSOCIATION’S EXERCISE OF RIGHT OF FIRST REFUSAL PROPER UNDER THE BUSINESS JUDGMENT RULE)

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