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BUYER WAS ENTITLED TO SPECIFIC PERFORMANCE OF A CONTRACT FOR THE SALE OF “INCLUSIONARY AIR RIGHTS” (IAR’S); IAR’S DICTATE THE ALLOWED SQUARE FOOTAGE OF BUILDINGS ON A PARCEL OF LAND (THE ALLOWED NUMBER OF FLOORS FOR EXAMPLE) (FIRST DEPT).

The First Department, reversing (modifying) Supreme Court, in a full-fledged opinion by Justice Gonzalez, determined that a contract for the purchase of “inclusionary air rights” (IAR’s) was subject to specific performance. “Air rights” are controlled by zoning regulations. For example, if a 10,000 square-foot parcel of land is allowed 50,000 square feet of floor space, the air rights for that 10,000 square-foot parcel constitute 40,000 square feet. Here the contract for the purchase of air rights between sophisticated real estate developers was deemed to be subject to specific performance. Defendant seller tried to back out of the deal because the selling price was too low:

… New York courts have consistently considered air rights an “interest in real property” … . … [S]pecific performance is not solely limited to real property; the remedy may also apply in other instances, such as a conveyance of shares of stock in a close corporation or an agreement to sell shares in a cooperative real estate corporation … .

… [S]pecific performance may be available in actions where the market is opaque and the price of the goods is subject to intense fluctuation … . … [S]pecific performance is warranted because of the parties’ incorporation of a specific performance in their agreement, defendant’s willful breach of the agreement, the absence of an inequitable or disproportionate burden, and the admitted uncertainty of valuing IARs.  301 E. 60th St. LLC v Competitive Solutions LLC, 2023 NY Slip Op 02842, First Dept 5-30-23

Practice Point: A contract for the sale of “inclusionary air right” (IAR’s) which, for example, dictate the number of floors allowed in a building constructed on a parcel of land, can be subject to specific performance.

 

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THE “NO ACTION” PROVISION IN THE CONTRACT PRECLUDED PLAINTIFFS FROM BRINGING A JUDICIAL BREACH OF CONTRACT ACTION; THE AVAILABLE CONTRACTUAL REMEDIES WERE DEEMED EXCLUSIVE (FIRST DEPT). ​

The First Department, reversing the appellate division, in a full-fledged opinion by Justice Oing, over a two-justice dissent, determined the complaint seeking a judicial determination whether the contingent resource payment (CRP) agreement was breached when Exxon purchased InterOil Corporation was properly dismissed. Exxon successfully argued that plaintiffs’ only recourse was contractual under the terms of the CRP. The opinion is far too detailed to fairly summarize here:

[The CRP] § 8.05’s penultimate sentence not only provides that plaintiffs cannot bring a class action to challenge any aspect of the CRP agreement, but it also bars them from bringing any action or proceeding altogether, “[n]otwithstanding anything to the contrary in this Agreement . . . no individual Holder or other group of Holders will be entitled to exercise such rights.” Such “rights,” written in the plural as opposed to in the singular, refer to those set out in the beginning of the sentence — namely, “institut[ing] any action or proceeding at law or in equity or in bankruptcy or otherwise upon or under or with respect to this Agreement.” Mulacek v ExxonMobil Corp., 2023 NY Slip Op 02829, First De[t 5-25-23

Practice Point: Here a provision in the contract providing that no court action for breach of contract could be brought, a so-called “no action” clause, precluded plaintiffs’ lawsuit.

 

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WHERE A JURY NOTE DOES NOT UNAMBIGUOUSLY DESCRIBE A REQUESTED EXHIBIT, THE NOTE MUST BE READ OR SHOWN TO THE PARTIES AND THE PARTIES MUST BE ALLOWED INPUT RE: THE PROPER RESPONSE; HERE THE JUDGE DID NOT FOLLOW THAT PROCEDURE AND THE CONVICTIONS WERE REVERSED (FIRST DEPT).

The First Department, reversing defendant’s convictions and ordering a new trial, determined the judge did not follow proper procedure re: notes received from the jury during deliberations:

The court did not follow the procedures set forth in People v O’Rama (78 NY2d 270[1991]) with regard to several jury notes. The record does not reflect that the court read or showed four of the jury’s notes to the parties or afforded them an opportunity to provide input regarding the proper response to the notes. Indeed, the record contains no indication that these four notes, each of which sought trial exhibits, were responded to at all. While “[n]otes that only require the ministerial act of sending exhibits into the jury room do not implicate the requirements of O’Rama” and CPL 310.30 … , notes that do not unambiguously describe the requested exhibits warrant input from counsel and are subject to O’Rama’s requirement of meaningful notice. Here, at least two of the notes that the court did not address fall into this latter category. Because of this mode of proceedings error, a new trial is called for. People v Baptiste, 2023 NY Slip Op 02835, First Dept 5-25-23

Practice Point: Although the judge need not share with the parties a note from the jury which requires only a ministerial act, the judge must share a note which is ambiguous about which exhibits are requested. The failure to share the note requires reversal and a new trial.

 

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THE PROOF OF DOMESTIC VIOLENCE AT THE FORTHCOMING CUSTODY TRIAL SHOULD NOT HAVE BEEN LIMITED TO INCIDENTS OCCURRING AFTER THE HAGUE CONVENTION PROCEEDINGS IN CYPRUS (FIRST DEPT). ​

The First Department, reversing (modifying) Family Court, determined the proof of domestic violence at the upcoming custody trial should not have been limited to incidents occurring after the Hague Convention proceedings in Cyprus:

… [T]hat aspect of the order that limits the proof of domestic violence that the mother may try to introduce at the forthcoming custody trial to incidents that have occurred since conclusion of the Hague Convention proceedings, is vacated. The court correctly recognized “[a] decision under the Convention is not a determination on the merits of any custody issue, but leaves custodial decisions to the courts of the country of habitual residence” … . However, it then effectively vested the Hague Convention proceedings with preclusive effect as to claims of domestic violence, by ruling that, at the impending custody hearing, the mother could only seek to introduce evidence of domestic violence that has occurred since those proceedings’ conclusion. There should have been no such temporal limitation imposed on the domestic violence evidence the mother may seek to introduce. Gould v Kontogiorge, 2023 NY Slip Op 02824, First Dept 5-25-23

Practice Point: Here Family Court should not have limited proof of domestic violence at the upcoming custody trial to incidents occurring after the Hague Convention proceedings in Cyprus. A Hague Convention is not a determination on the merits of any custody issue.

 

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THE FACT THAT THE PEOPLE WERE HELPING THE COMPLAINANT PROCURE A U VISA WHICH WOULD ALLOW THE COMPLAINANT TO STAY IN THE US AND APPLY FOR PERMANENT RESIDENCE WAS BRADY MATERIAL WHICH SHOULD HAVE BEEN PROVIDED TO THE DEFENSE; U VISAS ARE AVAILABLE TO ALIENS WHO SUFFER ABUSE FROM CRIMINAL ACTIVITY; CONVICTIONS REVERSED AND INDICTMENTS DISMISSED (FIRST DEPT).

The First Department, in a full-fledged opinion by Justice Moulton, determined defendants’ convictions should be reversed and the indictments dismissed because the People failed to reveal they were helping the complainant procure a U visa which would allow the complainant to remain in the United States and apply for permanent residence. A U visa is available to an alien who has suffered abuse as a victim of criminal activity. The defendants have already served their sentences and have been deported:

A U visa is available to an alien who “has suffered substantial physical or mental abuse as a result of having been a victim of criminal activity[,] . . . possesses information concerning criminal activity . . . [and] . . . has been helpful, is being helpful, or is likely to be helpful” to a Federal, State, or local law enforcement official, prosecutor, judge, or other authority prosecuting criminal activity … . * * *

To obtain a U visa from the United States Citizenship and Immigration Services, an applicant must first acquire a certification from a Federal, State, or local law enforcement official, prosecutor, judge, or other Federal, State, or local authority investigating criminal activity (see 8 USC § 1184 [p][1]). The certification must confirm that the applicant for a U visa “‘has been helpful, is being helpful, or is likely to be helpful'” in the investigation or prosecution of criminal activity … . Without a certification, the applicant cannot obtain a U visa. Law enforcement is not mandated to issue the certification … .

The U visa is a valuable benefit. Under Section 245(m) of the Act, after three years of continuous presence in the United States (in which the recipient also receives work authorization), the recipient may apply for lawful permanent residence in the United States. * * *

… [W]e cannot know what a jury would have done with further, material, impeachment arising from the U visa evidence. It might have found the U visa evidence fatally undermined [the complainant’s] credibility. We find that there is reasonable probability that had the jury considered the U visa evidence, it would have raised enough reasonable doubt to produce a different outcome. People v Flores, 2023 NY Slip Op 02768, First Dept 5-23-23

Practice Point: The People did not inform the defense they were helping the complainant procure a U visa which would allow the complainant to remain in the US and apply for permanent residence. A U visa is available to an alien who suffered abuse as a victim of criminal activity. The U-visa-information was Brady material which could have affected the outcome of the trial. The convictions were reversed and the indictments dismissed.

 

​ DEFENDANT WAS SENTENCED VIRTUALLY AND DID NOT WAIVE HIS RIGHT TO BE PRESENT; RESENTENCING ORDERED (FIRST DEPT).

The First Department determined defendant was entitled to be resentenced because the sentencing was virtual and defendant did not waive his right to be present:

… [D]efendant is entitled to be resentenced because he had a right to be personally present at his sentencing, and he did not expressly waive that right during the virtual proceeding (see CPL 380.40[1] …). People v Barksdale, 2023 NY Slip Op 02744, First Dept 5-18-23

Practice Point: For a virtual sentencing to be valid, the defendant must waive his right to be present.

 

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PLAINTIFF WAS DEEMED TO HAVE READ THE INFORMATION WHICH WAS HYPERLINKED; THEREFORE PLAINTIFF WAS DEEMED TO HAVE AGREED TO ARBITRATION (FIRST DEPT).

The First Department, reversing Supreme Court, determined plaintiff agreed to arbitrate based upon the hyperlinks in the document plaintiff reviewed:

Uber [defendant] sustained its burden of demonstrating that the parties had an explicit and unequivocal agreement to arbitrate. … [P]laintiff had agreed to be bound by the arbitration agreement when he affirmatively indicated and confirmed, by taking two separate actions, that he had reviewed and agreed to Uber’s updated terms of use, which were overtly hyperlinked as part of the pop-up screen and sufficient to form a binding contract … .

… [P]laintiff was on inquiry notice of the updated Terms of Use that required any disputes between the parties to be resolved by arbitration. Although a clickwrap agreement’s terms and conditions must be clear and conspicuous, they need not all be simultaneously and immediately visible; the terms may be binding and enforceable even if they are only accessible through a hyperlink … . The keys to enforceability are a reasonable indication of the existence of the additional terms and the user’s being required to manifest assent to them … . Brooks v Lang Yang, 2023 NY Slip Op 02610, First Dept 5-15-23

Practice Point: Here the plaintiff was deemed to have read information which was hyperlinked and therefore was deemed to have agreed to arbitrate.

 

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THE HOSTILE WORK ENVIRONMENT AND SEX DISCRIMINATION CLAIMS WERE NOT UNTIMELY BECAUSE A CONTINUING COURSE OF CONDUCT LEADING UP TO THE FILING OF THE COMPLAINT WAS ALLEGED (FIRST DEPT). ​

The First Department, reversing (modifying) Supreme Court, determined plaintiff’s hostile work environment and sex discrimination claims should not have been dismissed as untimely because a continuing pattern was sufficiently alleged:

The allegations supporting plaintiff’s hostile work environment and sex discrimination claims are timely, as she has sufficiently alleged facts comprising “a single continuing pattern of unlawful conduct extending into the [limitations] period immediately preceding the filing of the complaint” … . The complaint alleges that, following Corn’s sexual assault on plaintiff in February 2015, he continued to stare at her, lurked by her desk, made inappropriate, flirtatious comments toward her, disclosed intimate details about his marriage, and frequently pressured her to go out drinking, within the limitations period. It cannot be said that, as a matter of law, these acts were not part of a single continuing pattern of unlawful conduct supporting her hostile work environment and discrimination claims … .

Moreover, under the New York City Human Rights Law (Administrative Code of City of NY § 8-107) and amended New York State Human Rights Law (Executive Law § 296[h]), the allegations that Corn sexually assaulted plaintiff in 2015 and engaged in a pattern of gender-based misconduct in the workplace, demonstrate that she was subjected to inferior terms, conditions, or privileges of employment on the basis of her gender … . Crawford v American Broadcasting Co., Inc., 2023 NY Slip Op 02611, First Dept 5-16-23

Practice Point: Here the hostile work environment and sex discrimination claims should not have been dismissed as untimely because a continuing course of conduct up until the filing of the complaint was alleged.

 

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ALTHOUGH THE NYC ADMININSTRATIVE CODE MAKES TENANTS RESPONSIBLE FOR REMOVING ICE AND SNOW FROM SIDEWALKS, IT DOES NOT IMPOSE TORT LIABILITY FOR FAILURE TO DO SO; THE ADMINISTRATIVE CODE ALSO MAKES PROPERTY OWNERS RESPONSIBLE FOR SNOW AND ICE REMOVAL; THE LEASE SPECIFICALLY STATED DEFENDANT WAS NOT RESPONSIBLE FOR CLEARING SNOW AND ICE FROM THE SIDEWALK; DEFENDANT’S MOTION FOR SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (FIRST DEPT).

The First Department, reversing Supreme Court, determined the tenant, 185th Operating, was not liable for a sidewalk ice and snow slip and fall. Although the NYC Administrative Code makes tenants responsible for removing ice and snow from sidewalks, it does not impose tort liability for a failure to do so. Here the lease explicitly stated the tenant is not responsible for clearing ice and snow:

Although the applicable statute requires tenants to clear snow and ice from the sidewalks around their premises, the statute does not impose tort liability for noncompliance (Administrative Code of the City of New York § 16-123[a] …). Furthermore, Administrative Code § 7-210(a), which requires property owners to maintain the sidewalk abutting their property, does not impose liability on 185 Operating, as 185 Operating is a tenant of the premises, not the owner. Not only did 185th Operating’s lease with defendant owner … specifically state that 185th Operating was not responsible for maintaining the sidewalks adjacent to the premises, but [the owner’s] lease with defendant Staples …, a tenant occupying the same building as 185th Operating, expressly made Staples responsible for clearing snow and ice from the sidewalk where the icy condition had occurred.

The record does not present any evidence that 185th Operating’s earlier voluntary snow removal created or exacerbated a hazardous condition that then caused plaintiff’s injury … . Cruz v Heights Broadway, LLC, 2023 NY Slip Op 02612, First Dept 5-16-23

Practice Point: Here the lease specifically stated the defendant tenant was not responsible for removing ice and snow from the sidewalk. The NYC Administrative Code requires tenants to remove ice and snow but does not impose tort liability for the failure to do so. The code also requires owners to remove ice and snow. The tenant’s motion for summary judgment should have been granted.

 

PLAINTIFF, AN EDITORIAL DIRECTOR AT GAWKER, DID NOT SUFFICIENTLY ALLEGE THE DAILY BEAST REPORTERS WHO WROTE AN ARTICLE ABOUT GAWKER VIOLATED THE “GROSS IRRESPONSIBILITY STANDARD” IN MAKING STATEMENTS ABOUT PLAINTIFF; THE DEFAMATION COMPLAINT WAS DISMISSED (FIRST DEPT).

The First Department, reversing Supreme Court, determined plaintiff, an editor, did not sufficiently allege the reporters who wrote a story about the company where plaintiff worked acted in a “grossly irresponsible manner,” the standard for defamation in this context:

Plaintiff, who at the time of the article was employed by BDG Media as the editorial director of the digital media website Gawker, alleges that the article contained misleading excerpts of her communications with her colleagues at Gawker, omitting relevant context in order to inaccurately portray her as racist, homophobic, xenophobic, and transphobic. Plaintiff further alleges that the statements published in the article were false, misleading, or, to the extent they contained literal truth, taken out of context to place her in a defamatory light. Plaintiff maintains that … BDG Media terminated her employment as a result of the article.

… [P]laintiff’s defamation cause of action withstands dismissal only if she adequately alleges that defendants, all of whom are members of the media, “‘acted in a grossly irresponsible manner without due consideration for the standards of information gathering and dissemination ordinarily followed by responsible parties'” in writing and publishing the article … The “gross irresponsibility standard demands no more than that a publisher utilize methods of verification that are reasonably calculated to produce accurate copy” and does not require “exhaustive research [or] painstaking judgments” … . Furthermore, the alleged falsity or defamatory meaning of certain statements is not probative of whether defendants acted with gross irresponsibility … . Griffith v Daily Beast, 2023 NY Slip Op 02614, First Dept 5-16-23

Practice Point: Where matters of legitimate public concern are implicated, a plaintiff alleging defamation by reporters must allege the reporters violated the “gross irresponsibility standard;” the complaint here failed to do so.

 

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