You are here: / First Department

Tag Archive for: First Department

,

CONTRACT ALLEGATIONS DUPLICATED FRAUD ALLEGATIONS, FRAUD CAUSE OF ACTION SHOULD HAVE BEEN DISMISSED (FIRST DEPT).

The First Department, in a full-fledged opinion by Justice Friedman, over a dissenting opinion, determined the fraud cause of action should have been dismissed as duplicative of the breach of contract cause of action. The action is between two telecommunications companies. The allegations involve the responsibility for payment for fraudulent phone calls. Plaintiff (Cronos) alleged the contract required defendant (XComIP) to indemnify it for fraudulent calls. The complaint stated a cause of action for breach of contract. However, the fraud allegations were based on speculation about defendant’s intent, i.e., that defendant entered into the contract with the intention to avoid paying for fraudulent calls:

​

Cronos’s fraud cause of action falls short under the principle that a fraud claim is not stated by allegations that simply duplicate, in the facts alleged and damages sought, a claim for breach of contract, enhanced only by conclusory allegations that the pleader’s adversary made a promise while harboring the concealed intent not to perform it. This Court has held numerous times that a fraud claim that “ar[ises] from the same facts [as an accompanying contract claim], s[eeks] identical damages and d[oes] not allege a breach of any duty collateral to or independent of the parties’ agreements” is subject to dismissal as “redundant of the contract claim”… . Thus, where a fraud claim was supported by allegations that the defendants had “misrepresented . . . their intentions with respect to the manner” in which they would perform their contractual duties, we dismissed the fraud claim as duplicative of the plaintiffs’ contract claim because the fraud claim was “based on the same facts that underlie the contract cause of action, [was] not collateral to the contract, and d[id] not seek damages that would not be recoverable under a contract measure of damages” … .

​

… Cronos’s fraud claim is duplicative of its claim for breach of contract, inasmuch as the only fraud alleged is XComIP’s unkept promise to perform certain of its preexisting obligations under the parties’ contract (as alleged by Cronos), for which Cronos seeks exactly the same damages as are sought under the rubric of the claim for breach of contract. Based on Cronos’s own allegations, Cronos’s fraud claim is plainly redundant of its breach-of-contract cause of action. Cronos Group Ltd. v XComIP, LLC, 2017 NY Slip Op 06515, 1st Dept 9-19-17

 

CONTRACT LAW (FRAUD, CONTRACT ALLEGATIONS DUPLICATED FRAUD ALLEGATIONS, FRAUD CAUSE OF ACTION SHOULD HAVE BEEN DISMISSED (FIRST DEPT))/FRAUD (CONTRACT ALLEGATIONS DUPLICATED FRAUD ALLEGATIONS, FRAUD CAUSE OF ACTION SHOULD HAVE BEEN DISMISSED (FIRST DEPT))

, ,

MULTI-MILLION DOLLAR VERDICTS AGAINST THE OWNER PERSONALLY AND HIS COMPANIES WARRANTED, WORKER SAFETY DISREGARDED WHEN REPAIR TO CONSTRUCTION CRANE UNDERTAKEN, CRANE OPERATOR AND CO-WORKER ON THE GROUND KILLED WHEN CRANE FELL (FIRST DEPT).

The First Department, in a full-fledged opinion by Justice Webber, determined the corporate veil was properly pierced, a defense expert’s testimony was properly excluded, and millions in damages for pre-impact terror, conscious pain and suffering, as well as punitive damages, were warranted. However, the court deemed the damages awarded by the jury excessive. The defendants were responsible for ordering a new part for a construction crane defendants provided at a construction site. There was evidence the manufacturer of the part was known to be incompetent but was chosen by the defendants anyway to cut costs. The defendants were aware of serious flaws in a similar part made by the same manufacturer. There was evidence the required testing procedures for the new part were deliberately circumvented by the defendants. The evidence supported the jury’s conclusion that the new part failed causing the crane to fall 200 feet, fatally injuring the plaintiffs, the crane operator (Leo) and a co-worker (Kurtaj) on the ground:

​

… [O]ne individual (Lomma) exercised domination and control over three separate corporations which he treated as one entity.

There was … sufficient evidence to permit the jury to assess personal liability against Lomma. Contrary to Lomma’s arguments, plaintiffs presented substantial evidence of Lomma’s personal participation in the corporate defendants’ affirmatively tortious acts launching the dangerous instrumentality that caused the deaths of plaintiffs’ decedents … . …

The trial court properly precluded the proposed testimony of defense expert James Wiethorn, which not only was not based on facts in the record, but also contradicted facts in the record … . * * *

​

Preimpact terror is a sub-category of conscious pain and suffering … . * * *

​

While Lomma and his companies, which dominated the crane rental market in New York, may not have intended to cause plaintiffs’ deaths, these deaths nevertheless arose from a series of calculated decisions made by Lomma over a period of months, during which time Lomma placed profit over the safety of construction workers and the public, despite having multiple opportunities to change course. * * *

​

“[I]t is the duty of the court to keep a verdict for punitive damages within reasonable bounds considering the purpose to be achieved as well as the mala fides of the defendant in the particular case”… . Moreover, “[a]lthough states possess considerable discretion over the imposition of punitive damages, the United States Supreme Court has emphasized that there are constitutional limitations on such awards, and that the Due Process Clause of the Fourteenth Amendment prohibits the imposition of grossly excessive or arbitrary punishments upon a tortfeasor” … . Matter of 91st St. Crane Collapse Litig., 2017 NY Slip Op 06419, First Dept 9-12-17

NEGLIGENCE (MULTI-MILLION DOLLAR VERDICTS AGAINST THE OWNER PERSONALLY AND HIS COMPANIES WARRANTED, WORKER SAFETY DISREGARDED WHEN REPAIR TO CONSTRUCTION CRANE UNDERTAKEN, CRANE OPERATOR AND CO-WORKER ON THE GROUND KILLED WHEN CRANE FELL (FIRST DEPT))/CORPORATION LAW (PIERCE CORPORATE VEIL, MULTI-MILLION DOLLAR VERDICTS AGAINST THE OWNER PERSONALLY AND HIS COMPANIES WARRANTED, WORKER SAFETY DISREGARDED WHEN REPAIR TO CONSTRUCTION CRANE UNDERTAKEN, CRANE OPERATOR AND CO-WORKER ON THE GROUND KILLED WHEN CRANE FELL (FIRST DEPT))/PIERCE CORPORATE VEIL (MULTI-MILLION DOLLAR VERDICTS AGAINST THE OWNER PERSONALLY AND HIS COMPANIES WARRANTED, WORKER SAFETY DISREGARDED WHEN REPAIR TO CONSTRUCTION CRANE UNDERTAKEN, CRANE OPERATOR AND CO-WORKER ON THE GROUND KILLED WHEN CRANE FELL (FIRST DEPT))CRANES (MULTI-MILLION DOLLAR VERDICTS AGAINST THE OWNER PERSONALLY AND HIS COMPANIES WARRANTED, WORKER SAFETY DISREGARDED WHEN REPAIR TO CONSTRUCTION CRANE UNDERTAKEN, CRANE OPERATOR AND CO-WORKER ON THE GROUND KILLED WHEN CRANE FELL (FIRST DEPT))/LABOR LAW-CONSTRUCTION LAW  (MULTI-MILLION DOLLAR VERDICTS AGAINST THE OWNER PERSONALLY AND HIS COMPANIES WARRANTED, WORKER SAFETY DISREGARDED WHEN REPAIR TO CONSTRUCTION CRANE UNDERTAKEN, CRANE OPERATOR AND CO-WORKER ON THE GROUND KILLED WHEN CRANE FELL (FIRST DEPT))

, ,

FAMILY COURT EXERCISED THE PROPER LEVEL OF CONSIDERATION OF THE AMERICANS WITH DISABILITIES ACT IN THIS TERMINATION OF PARENTAL RIGHTS PROCEEDING, THE MOOTNESS EXCEPTION APPLIED TO THE APPEAL (FIRST DEPT).

The First Department determined Family Court gave proper consideration to the Americans with Disabilities Act (ADA) in evaluating the termination of parental rights. The main issue raised at the permanency hearing was “to what degree the [foster care] agency was required to accommodate the parents’ cognitive disabilities when discharging its obligation to pursue the goal of return to parent.” The First Department also found that the mootness exception applied to the appeal (the issue is likely to come up again):

​

While Family Court correctly determined that the ADA is not applicable to this proceeding (see Matter of La’Asia Lanae S., 23 AD3d 271 [1st Dept 2005]), the law makes clear, as Family Court recognized and the parties in this case agreed, that “the agencies’ efforts towards a permanency plan must be tailored to the particular circumstances and individuals in a given case” … . As the Family Court held in La’Asia  … (91 Misc 2d 28, 42-43 …) , in the context of termination of parental rights actions, a court may properly look to the ADA’s standards for guidance in evaluating whether “diligent efforts” were made by the agency under Social Services Law § 384-b(7). The Family Court here acknowledged that it was required to consider the mother’s special needs when determining if the agency’s efforts were reasonable in this case. After evaluating the agency’s efforts in that light, the court found that the agency satisfied its obligation to tailor its efforts to the mother’s needs … and that the agency’s reunification efforts were reasonable under the circumstances … .

In precluding litigation of ADA claims during the permanency hearing, but considerate of its purpose to guide the reasonable efforts analysis, the Family Court properly complied with the requirements as set forth by the court in the La’Asia case. Matter of Lacee L. (Stephanie L.–Dekodia L.), 2017 NY Slip Op 06418, First Dept 9-12-17

 

FAMILY LAW (FAMILY COURT EXERCISED THE PROPER LEVEL OF CONSIDERATION OF THE AMERICANS WITH DISABILITIES ACT IN THIS TERMINATION OF PARENTAL RIGHTS PROCEEDING, THE MOOTNESS EXCEPTION APPLIED TO THE APPEAL (FIRST DEPT))/PARENTAL RIGHTS (FAMILY COURT EXERCISED THE PROPER LEVEL OF CONSIDERATION OF THE AMERICANS WITH DISABILITIES ACT IN THIS TERMINATION OF PARENTAL RIGHTS PROCEEDING, THE MOOTNESS EXCEPTION APPLIED TO THE APPEAL (FIRST DEPT))/APPEALS (MOOTNESS EXCEPTION, FAMILY COURT EXERCISED THE PROPER LEVEL OF CONSIDERATION OF THE AMERICANS WITH DISABILITIES ACT IN THIS TERMINATION OF PARENTAL RIGHTS PROCEEDING, THE MOOTNESS EXCEPTION APPLIED TO THE APPEAL (FIRST DEPT))/MOOTNESS EXCEPTION  (APPEALS, FAMILY COURT EXERCISED THE PROPER LEVEL OF CONSIDERATION OF THE AMERICANS WITH DISABILITIES ACT IN THIS TERMINATION OF PARENTAL RIGHTS PROCEEDING, THE MOOTNESS EXCEPTION APPLIED TO THE APPEAL (FIRST DEPT))/AMERICANS WITH DISABILITIES ACT (ADA)  (FAMILY COURT EXERCISED THE PROPER LEVEL OF CONSIDERATION OF THE AMERICANS WITH DISABILITIES ACT IN THIS TERMINATION OF PARENTAL RIGHTS PROCEEDING, THE MOOTNESS EXCEPTION APPLIED TO THE APPEAL (FIRST DEPT))

,

QUESTION OF FACT WHETHER LANDLORD’S FAILURE TO UPGRADE 1930’S ELECTRICAL SYSTEM BREACHED A DUTY OWED TO THE TENANT TO KEEP THE APARTMENT SAFE, PLAINTIFF TENANT WAS INJURED IN A FIRE WHICH STARTED IN THE ELECTRICAL WIRING (FIRST DEPT).

The First Department, over a two-justice dissent, determined there was a question of fact whether the defendant landlord had breached its duty to keep plaintiff’s apartment reasonably safe. Plaintiff was injured in a fire in his apartment which was determined to have started in electrical wiring. Plaintiff had complained over the years about the inadequacy of the number of electrical outlets and the condition of the outlets. Plaintiff used extension cords and a power strip compensate for the allegedly inadequate outlets. The issue is whether the landlord’s failure to upgrade the 1930’s electrical system in the apartment breached a duty owed plaintiff:

​

There is a triable issue of fact as to whether defendant had actual or constructive notice that a dangerous condition existed in plaintiff’s apartment that it failed to remedy … . Specifically, plaintiff’s expert raised factual issues as to whether the building’s 1930s electrical system constituted a dangerous condition and whether defendant was on notice of same. Although the expert, a professional engineer, did not personally inspect the premises, he based his opinion that the fire was caused by overloaded electrical wires on specific factual evidence in the record and his knowledge of consumers’ changed needs since the 1930s because of the invention and development of power-hungry personal appliances that simply require more electrical power … . Daly v 9 E. 36th LLC, 2017 NY Slip Op 06404, First Dept 9-5-17

LANDLORD-TENANT (NEGLIGENCE, QUESTION OF FACT WHETHER LANDLORD’S FAILURE TO UPGRADE 1930’S ELECTRICAL SYSTEM BREACHED A DUTY OWED TO THE TENANT TO KEEP THE APARTMENT SAFE, PLAINTIFF TENANT WAS INJURED IN A FIRE WHICH STARTED IN THE ELECTRICAL WIRING (FIRST DEPT))/NEGLIGENCE (LANDLORD-TENANT, QUESTION OF FACT WHETHER LANDLORD’S FAILURE TO UPGRADE 1930’S ELECTRICAL SYSTEM BREACHED A DUTY OWED TO THE TENANT TO KEEP THE APARTMENT SAFE, PLAINTIFF TENANT WAS INJURED IN A FIRE WHICH STARTED IN THE ELECTRICAL WIRING (FIRST DEPT))/ELECTRICAL WIRING (LANDLORD-TENANT, NEGLIGENCE, QUESTION OF FACT WHETHER LANDLORD’S FAILURE TO UPGRADE 1930’S ELECTRICAL SYSTEM BREACHED A DUTY OWED TO THE TENANT TO KEEP THE APARTMENT SAFE, PLAINTIFF TENANT WAS INJURED IN A FIRE WHICH STARTED IN THE ELECTRICAL WIRING (FIRST DEPT))

, ,

FAILURE TO CLEARLY INFORM DEFENDANT THAT PLEADING GUILTY TO AN AGGRAVATED FELONY TRIGGERS DEPORTATION CONSTITUTED INEFFECTIVE ASSISTANCE OF COUNSEL, MERELY TELLING DEFENDANT THERE WAS A RISK OF DEPORTATION WAS NOT ENOUGH (FIRST DEPT).

The First Department, over a dissent, determined defendant should be given the opportunity to move to vacate his guilty plea because defense counsel did not make it clear that pleading guilty to an aggravated felony triggered deportation. Informing defendant of a risk of deportation was not sufficient and constituted ineffective assistance of counsel:

​

Since an aggravated felony results in mandatory deportation … , counsel is under a duty to provide clear advice as to that consequence. It is thus ineffective assistance to advise a noncitizen of a mere risk or possibility that he “could be deported” … . People v Doumbia, 2017 NY Slip Op 06402, First Dept 9-5-17

CRIMINAL LAW (ATTORNEYS, FAILURE TO CLEARLY INFORM DEFENDANT THAT PLEADING GUILTY TO AN AGGRAVATED FELONY TRIGGERS DEPORTATION CONSTITUTED INEFFECTIVE ASSISTANCE OF COUNSEL, MERELY TELLING DEFENDANT THERE WAS A RISK OF DEPORTATION WAS NOT ENOUGH (FIRST DEPT))/ATTORNEYS (CRIMINAL LAW,  FAILURE TO CLEARLY INFORM DEFENDANT THAT PLEADING GUILTY TO AN AGGRAVATED FELONY TRIGGERS DEPORTATION CONSTITUTED INEFFECTIVE ASSISTANCE OF COUNSEL, MERELY TELLING DEFENDANT THERE WAS A RISK OF DEPORTATION WAS NOT ENOUGH (FIRST DEPT))/INEFFECTIVE ASSISTANCE (CRIMINAL LAW, FAILURE TO CLEARLY INFORM DEFENDANT THAT PLEADING GUILTY TO AN AGGRAVATED FELONY TRIGGERS DEPORTATION CONSTITUTED INEFFECTIVE ASSISTANCE OF COUNSEL, MERELY TELLING DEFENDANT THERE WAS A RISK OF DEPORTATION WAS NOT ENOUGH (FIRST DEPT))

,

JURY SHOULD HAVE BEEN INSTRUCTED ON THE INNOCENT POSSESSION OF A WEAPON DEFENSE, NEW TRIAL ORDERED (FIRST DEPT).

The First Department, in a full-fledged opinion by Justice Kapnick, reversing defendant’s conviction for possession of a weapon, determined the jury should have been instructed on the innocent possession of a weapon defense. There was evidence that the defendant had taken the pistol away from decedent, who had struck him with it. Defendant walked away with the pistol. Three minutes later defendant was grabbed from behind by a man who was with the decedent. There was evidence the defendant shot the man and the decedent. The jury was instructed on the justification defense and acquitted the defendant of manslaughter:

​

When this evidence is viewed in the light most favorable to defendant, nothing he did or failed to do in the very brief interval between excusably obtaining the pistol and being confronted by the decedent and his companions constituted “us[ing the pistol] in a dangerous manner” … . Given the justification defense, which, as the court correctly determined, warranted a justification charge, the fact that defendant shot the decedent did not constitute a “dangerous use” barring the court from giving a temporary lawful possession charge. Courts have found that the firing of shots did not negate a defendant’s entitlement to a temporary lawful possession instruction where the shooting was justified and the possession was otherwise lawful. People v Bonilla, 2017 NY Slip Op 06405, First Dept 9-5-17

CRIMINAL LAW (JURY SHOULD HAVE BEEN INSTRUCTED ON THE INNOCENT POSSESSION OF A WEAPON DEFENSE, NEW TRIAL ORDERED (FIRST DEPT))/EVIDENCE (CRIMINAL LAW, JURY SHOULD HAVE BEEN INSTRUCTED ON THE INNOCENT POSSESSION OF A WEAPON DEFENSE, NEW TRIAL ORDERED (FIRST DEPT))/JURY INSTRUCTIONS (CRIMINAL LAW, JURY SHOULD HAVE BEEN INSTRUCTED ON THE INNOCENT POSSESSION OF A WEAPON DEFENSE, NEW TRIAL ORDERED (FIRST DEPT))/WEAPON, POSSESSION OF (JURY SHOULD HAVE BEEN INSTRUCTED ON THE INNOCENT POSSESSION OF A WEAPON DEFENSE, NEW TRIAL ORDERED (FIRST DEPT))/INNOCENT POSSESSION OF A WEAPON (JURY SHOULD HAVE BEEN INSTRUCTED ON THE INNOCENT POSSESSION OF A WEAPON DEFENSE, NEW TRIAL ORDERED (FIRST DEPT))

,

DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN DISMISSED FOR FAILURE TO MEET 60-DAY DEADLINE IMPOSED BY A LOCAL COURT RULE, QUESTION OF FACT WHETHER THE CONTINUOUS TREATMENT DOCTRINE TOLLED THE STATUTE OF LIMITATIONS, LACK OF INFORMED CONSENT DOES NOT APPLY TO FAILURE TO DIAGNOSE (FIRST DEPT).

The First Department, reversing Supreme Court, over an extensive dissent, determined Supreme Court should not have dismissed defendants’ motions for summary judgment in this medical malpractice. The motions were dismissed on procedural grounds because they were filed and served a few days after the 60-day deadline imposed by the local court rules. The courts had been closed when the papers were supposed to be filed due to a storm. The 2nd Department went on to determine the merits. Plaintiff had experienced headaches over a period of years and had sought treatment for them. Eventually a benign brain tumor was discovered. In removing the tumor plaintiff was rendered legally blind. The malpractice action alleged a negligent failure to diagnose the tumor, and lack of informed consent. The court held that the continuing treatment doctrine tolled the statute of limitations even though the treatment was for headaches, not the tumor, because the presence of the tumor had not been diagnosed. The court went on to find that the informed consent cause of action was not viable because the alleged malpractice was a failure to diagnose, not the negligent performance of a surgical procedure:

… [T]he record presents issues of fact as to continuous treatment. As is well established, “the continuous treatment doctrine tolls the Statute of Limitations for a medical malpractice action when the course of treatment which includes the wrongful acts or omissions has run continuously and is related to the same original condition or complaint” … . In addition, “[w]here the malpractice claim is based on an alleged failure to properly diagnose a condition, the continuous treatment doctrine may apply as long as the symptoms being treated indicate the presence of that condition” … . * * *

… [T]he informed consent claim lacks merit. As we have held, “[a] failure to diagnose cannot be the basis of a cause of action for lack of informed consent unless associated with a diagnostic procedure that involve[s] invasion or disruption of the integrity of the body'” … . Lewis v Rutkovsky, 2017 NY Slip Op 06342, First Dept 8-29-17

 

NEGLIGENCE (MEDICAL MALPRACTICE, DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN DISMISSED FOR FAILURE TO MEET 60-DAY DEADLINE IMPOSED BY A LOCAL COURT RULE, QUESTION OF FACT WHETHER THE CONTINUOUS TREATMENT DOCTRINE TOLLED THE STATUTE OF LIMITATION, LACK OF INFORMED CONSENT DOES NOT APPLY TO FAILURE TO DIAGNOSE (FIRST DEPT))/MEDICAL MALPRACTICE (DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN DISMISSED FOR FAILURE TO MEET 60-DAY DEADLINE IMPOSED BY A LOCAL COURT RULE, QUESTION OF FACT WHETHER THE CONTINUOUS TREATMENT DOCTRINE TOLLED THE STATUTE OF LIMITATION, LACK OF INFORMED CONSENT DOES NOT APPLY TO FAILURE TO DIAGNOSE (FIRST DEPT))/CONTINUOUS TREATMENT DOCTRINE  (MEDICAL MALPRACTICE, DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN DISMISSED FOR FAILURE TO MEET 60-DAY DEADLINE IMPOSED BY A LOCAL COURT RULE, QUESTION OF FACT WHETHER THE CONTINUOUS TREATMENT DOCTRINE TOLLED THE STATUTE OF LIMITATION, LACK OF INFORMED CONSENT DOES NOT APPLY TO FAILURE TO DIAGNOSE (FIRST DEPT))/INFORMED CONSENT  (MEDICAL MALPRACTICE, DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN DISMISSED FOR FAILURE TO MEET 60-DAY DEADLINE IMPOSED BY A LOCAL COURT RULE, QUESTION OF FACT WHETHER THE CONTINUOUS TREATMENT DOCTRINE TOLLED THE STATUTE OF LIMITATION, LACK OF INFORMED CONSENT DOES NOT APPLY TO FAILURE TO DIAGNOSE (FIRST DEPT))/CIVIL PROCEDURE (DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN DISMISSED FOR FAILURE TO MEET 60-DAY DEADLINE IMPOSED BY A LOCAL COURT RULE (FIRST DEPT))

, ,

ALTHOUGH THE ASBESTOS LIABILITY RELEASE SIGNED BY PLAINTIFF’S DECEDENT IN 1997 MENTIONED MESOTHEMIOLA, THE LANGUAGE OF THE RELEASE WAS DEEMED TO BE BOILERPLATE WHICH DID NOT PRECLUDE THE INSTANT SUIT ALLEGING DEATH FROM MESOTHEMIOLA (FIRST DEPT).

The First Department, over an extensive dissent, determined a release plaintiff’s decedent (South) agreed to in 1997 did not preclude the instant suit. South alleged he had been exposed to asbestos made by Texaco on board ships during his long career in the Merchant Marine. South died of mesothelioma. The 1997 release mentioned mesothelioma as a possible result of asbestos exposure but the First Department determined it was not clear South knew he was suffering from mesothemiola at the time he signed the release (in return for $1750.00). The case was analyzed under federal admiralty law law (Jones Act):

… [W]e find that the release does not pass muster. To tease out the true intent South had when he signed the release, it is necessary to consider the context in which he did so. The 1997 complaint, while making generalized allegations that South had been exposed to asbestos, is exceedingly vague as to whether he had actually contracted an asbestos-related disease. To be sure, it mentions a “devastating pulmonary disease Plaintiff now suffers” and an exhaustive grab-bag of asbestos-related diseases, from asbestosis to mesothelioma to brain cancer. However, it is impossible to conclude from the complaint that South had actually received a diagnosis. Indeed, the “meager” consideration he received for resolving the claim suggests that he had not been diagnosed with an asbestos-related disease, much less one even approaching the severity of the mesothelioma that the complaint specifically alleges he had. The complaint leaves open that possibility, to the extent it seeks relief for fear of an asbestos-related disease and not for the disease itself. Accordingly, the risk of contracting an actual asbestos-related disease remained hypothetical to South, and we decline to read the release as if South understood the implications of such a disease but chose nonetheless to release Texaco from claims arising from it.

Further, if South had not received a definitive diagnosis at the time the 1997 complaint was filed, then the release, to the extent it warns him of the possibility of “a new and different diagnosis from the diagnosis as of the date of this Release,” does not reflect the actual circumstances known to him, since the words “new” and “different” suggest that South had already been diagnosed with a disease when he executed the release. Rather, the lack of an actual diagnosis reveals the language in the release as mere boilerplate, and not the result of an agreement the parameters of which had been specifically negotiated and understood by South. Matter of New York City Asbestos Litig., 2017 NY Slip Op 06343  First Dept 8-29-17

CONTRACT LAW (RELEASES, ALTHOUGH THE ASBESTOS LIABILITY RELEASE SIGNED BY PLAINTIFF’S DECEDENT IN 1997 MENTIONED MESOTHEMIOLA, THE LANGUAGE OF THE RELEASE WAS DEEMED TO BE BOILERPLATE WHICH DID NOT PRECLUDE THE INSTANT SUIT ALLEGING DEATH FROM MESOTHEMIOLA (FIRST DEPT))/NEGLIGENCE (ASBESTOS, RELEASES, ALTHOUGH THE ASBESTOS LIABILITY RELEASE SIGNED BY PLAINTIFF’S DECEDENT IN 1997 MENTIONED MESOTHEMIOLA, THE LANGUAGE OF THE RELEASE WAS DEEMED TO BE BOILERPLATE WHICH DID NOT PRECLUDE THE INSTANT SUIT ALLEGING DEATH FROM MESOTHEMIOLA (FIRST DEPT))/TOXIC TORTS (ASBESTOS, ALTHOUGH THE ASBESTOS LIABILITY RELEASE SIGNED BY PLAINTIFF’S DECEDENT IN 1997 MENTIONED MESOTHEMIOLA, THE LANGUAGE OF THE RELEASE WAS DEEMED TO BE BOILERPLATE WHICH DID NOT PRECLUDE THE INSTANT SUIT ALLEGING DEATH FROM MESOTHEMIOLA (FIRST DEPT))/ASBESTOS (TOXIC TORTS, RELEASES, ALTHOUGH THE ASBESTOS LIABILITY RELEASE SIGNED BY PLAINTIFF’S DECEDENT IN 1997 MENTIONED MESOTHEMIOLA, THE LANGUAGE OF THE RELEASE WAS DEEMED TO BE BOILERPLATE WHICH DID NOT PRECLUDE THE INSTANT SUIT ALLEGING DEATH FROM MESOTHEMIOLA (FIRST DEPT))/ASBESTOS (TOXIC TORTS, RELEASES, ALTHOUGH THE ASBESTOS LIABILITY RELEASE SIGNED BY PLAINTIFF’S DECEDENT IN 1997 MENTIONED MESOTHEMIOLA, THE LANGUAGE OF THE RELEASE WAS DEEMED TO BE BOILERPLATE WHICH DID NOT PRECLUDE THE INSTANT SUIT ALLEGING DEATH FROM MESOTHEMIOLA (FIRST DEPT))/MESOPTHEMIOLA (ASBESTOS, RELEASES, ALTHOUGH THE ASBESTOS LIABILITY RELEASE SIGNED BY PLAINTIFF’S DECEDENT IN 1997 MENTIONED MESOTHEMIOLA, THE LANGUAGE OF THE RELEASE WAS DEEMED TO BE BOILERPLATE WHICH DID NOT PRECLUDE THE INSTANT SUIT ALLEGING DEATH FROM MESOTHEMIOLA (FIRST DEPT))

,

FOR CAUSE FORFEITURE TERM OF DEFERRED COMPENSATION AGREEMENT NOT ELIMINATED BY A SUBSEQUENT FORM EXTENDING THE DUE DATE OF THE DEFERRED COMPENSATION (FIRST DEPT).

The First Department determined defendant-employees’ motions for summary judgment were properly denied. Defendants were subject to deferred compensation agreements (DCA’s) which called for the “for cause” forfeiture of the deferred compensation. Here it was alleged the defendants violated a non-solicitation, non-competition clause and therefore forfeited the deferred compensation. The defendants argued a subsequent document, an “election form” which extended the date on which the deferred compensation was due and payable, and which did not include a “for cause” forfeiture provision, should control. The courts disagreed:

… [T]he Election Forms, by their express language, provide that any deferral of payment of deferred compensation is to be made “in accordance with the terms of the Deferred Compensation Agreement . . . .” The DCAs, as noted, clearly provide in paragraph 4 that deferred compensation is forfeited if the employee is terminated for cause, including violation of non-solicitation or noncompetition covenants. There is no mention in the Election Forms of any intent to override this provision.

Additionally, paragraph 5 of the DCAs specifically provides that their terms “may not be altered, modified, or amended except by written instrument signed by the parties hereto.” At a minimum, it is commercially reasonable to view the Election Forms, on their face, to be informal human resources administrative forms. In any case, they are not “written instrument[s] signed by the parties [to the DCAs],” as they lack any signature of plaintiffs, as required by paragraph 5 in order to amend the DCAs. Perella Weinberg Partners LLC v Kramer,2017 NY Slip Op 06341, First Dept 8-29-17

CONTRACT LAW (FOR CAUSE FORFEITURE TERM OF DEFERRED COMPENSATION AGREEMENT NOT ELIMINATED BY A SUBSEQUENT FORM EXTENDING THE DUE DATE OF THE DEFERRED COMPENSATION (FIRST DEPT))/EMPLOYMENT LAW (CONTRACT LAW, FOR CAUSE FORFEITURE TERM OF DEFERRED COMPENSATION AGREEMENT NOT ELIMINATED BY A SUBSEQUENT FORM EXTENDING THE DUE DATE OF THE DEFERRED COMPENSATION (FIRST DEPT))/DEFERRED COMPENSATION AGREEMENT (FOR CAUSE FORFEITURE TERM OF DEFERRED COMPENSATION AGREEMENT NOT ELIMINATED BY A SUBSEQUENT FORM EXTENDING THE DUE DATE OF THE DEFERRED COMPENSATION (FIRST DEPT))

, ,

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))

Categories

Sign Up for the Mailing List to Be Notified When the Site Is Updated.

  • This field is for validation purposes and should be left unchanged.

Copyright © 2026 New York Appellate Digest, Inc.
Site by CurlyHost | Privacy Policy