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THE FLAWS IN PLAINTIFF’S PROOF OF STANDING TO BRING THE FORECLOSURE ACTION DID NOT ENTITLE DEFENDANT TO SUMMARY JUDGMENT ON THE CROSS MOTION; SUMMARY JUDGMENT CANNOT BE GRANTED TO A MOVING PARTY BASED UPON FLAWS IN THE OPPOSING PAPERS.

The Second Department, modifying Supreme Court’s order, determined defendant was not entitled to summary judgment in a foreclosure proceeding. Defendant alleged plaintiff, Aurora Loan Services, did not have standing to bring the action (i.e., did not have possession of the note at the time the action was commenced). Aurora Loan Services was unable to demonstrate standing because the evidence submitted did not meet the requirements of the business records exception to the hearsay rule. Aurora’s summary judgment motion was therefore properly denied. However, the flaws in Aurora’s proof of standing did not entitle defendant to summary judgment on defendant’s cross motion. In the summary judgment context, the court first looks only at the moving party’s papers to determine whether the moving party has made a prima facie showing justifying summary judgment. Here the defendant’s papers did not demonstrate Aurora lacked standing. Therefore the cross motion should have been denied, notwithstanding the flaws in the plaintiff’s opposing papers.

… Supreme Court erred in granting the defendant’s cross motion for summary judgment dismissing the complaint insofar as asserted against him for lack of standing and to cancel the notice of pendency filed against the subject property. “[T]he burden is on the moving defendant to establish, prima facie, the plaintiff’s lack of standing, rather than on the plaintiff to affirmatively establish its standing in order for the motion to be denied. To defeat a defendant’s motion, the plaintiff has no burden of establishing its standing as a matter of law” … . Here, the defendant, as the moving party, failed to make a prima facie showing that the plaintiff lacked standing … . Aurora Loan Servs., LLC v Mercius, 2016 NY Slip Op 02599, 2nd Dept 4-6-16

FORECLOSURE FLAWS IN PLAINTIFF’S PROOF OF STANDING TO BRING THE FORECLOSURE ACTION DID NOT ENTITLE DEFENDANT TO SUMMARY JUDGMENT ON THE CROSS MOTION; SUMMARY JUDGMENT CANNOT BE GRANTED TO THE MOVING PARTY BASED UPON FLAWS IN THE OPPOSING PAPERS)/EVIDENCE (SUMMARY JUDGMENT MOTIONS, FORECLOSURE, FLAWS IN PLAINTIFF’S PROOF OF STANDING TO BRING THE FORECLOSURE ACTION DID NOT ENTITLE DEFENDANT TO SUMMARY JUDGMENT ON THE CROSS MOTION; SUMMARY JUDGMENT CANNOT BE GRANTED TO THE MOVING PARTY BASED UPON FLAWS IN THE OPPOSING PAPERS)/SUMMARY JUDGMENT MOTIONS (SUMMARY JUDGMENT CANNOT BE GRANTED TO THE MOVING PARTY BASED UPON FLAWS IN THE OPPOSING PAPERS)/CIVIL PROCEDURE (SUMMARY JUDGMENT MOTIONS, FORECLOSURE, FLAWS IN PLAINTIFF’S PROOF OF STANDING TO BRING THE FORECLOSURE ACTION DID NOT ENTITLE DEFENDANT TO SUMMARY JUDGMENT ON THE CROSS MOTION; SUMMARY JUDGMENT CANNOT BE GRANTED TO THE MOVING PARTY BASED UPON FLAWS IN THE OPPOSING PAPERS)

SAME-SEX SPOUSE OF BIOLOGICAL MOTHER HAD STANDING TO SEEK VISITATION WITH CHILDREN CONCEIVED BY ARTIFICIAL INSEMINATION; CALIFORNIA MARRIAGE RECOGNIZED UNDER PRINCIPLES OF COMITY.

The Second Department, in a full-fledged opinion by Justice Roman, affirming Family Court, determined one of the parties to a California same-sex marriage, Kelly S., had standing to seek visitation with the couple’s children, now in New York with the birth mother, Farah M., notwithstanding the parties’ failure to comply with California’s artificial insemination law. The two children named in the visitation proceedings were conceived by artificial insemination performed in the home by the mother, Farah M. All three of the couple’s children were fathered by the same sperm donor, a friend who maintained a relationship with the children. The Second Department held that Kelly S., who moved to Arizona after the couple separated, under principles of comity, had standing to bring an action for visitation in New York:

Here, the parties first entered into a registered domestic partnership in California in 2004, prior to the birth of Z.S., and thus, Kelly S. was the presumed parent of Z.S. by virtue of the parties’ status as registered domestic partners (see Cal Fam Code §§ 297.5[d]; 7611[a]). Moreover, Kelly S. gave her consent to be named as a parent on the birth certificate of Z.S., and the parties were later married in California in August 2008, making Kelly S. the presumed parent of Z.S. pursuant to California Family Code § 7611(c)(1). After the parties’ marriage, the child E.S. was born. Thus, Kelly S. is presumed to be the natural parent of E.S. by virtue of the parties’ marriage pursuant to California Family Code § 7611(a). Furthermore, the Family Court, as a matter of comity, properly recognized Kelly S. as the parent of the subject children under New York law … . Matter of S. v Farah M., 2016 NY Slip Op 02676, 2nd Dept 4-6-16

FAMILY LAW (SAME-SEX SPOUSE OF BIOLOGICAL MOTHER HAD STANDING TO SEEK VISITATION WITH CHILDREN CONCEIVED BY ARTIFICIAL INSEMINATION; CALIFORNIA MARRIAGE RECOGNIZED UNDER PRINCIPLES OF COMITY)/SAME-SEX MARRIAGE (SAME-SEX SPOUSE OF BIOLOGICAL MOTHER HAD STANDING TO SEEK VISITATION WITH CHILDREN CONCEIVED BY ARTIFICIAL INSEMINATION; CALIFORNIA MARRIAGE RECOGNIZED UNDER PRINCIPLES OF COMITY)/COMITY (SAME-SEX SPOUSE OF BIOLOGICAL MOTHER HAD STANDING TO SEEK VISITATION WITH CHILDREN CONCEIVED BY ARTIFICIAL INSEMINATION; CALIFORNIA MARRIAGE RECOGNIZED UNDER PRINCIPLES OF COMITY)/VISITATION  (SAME-SEX SPOUSE OF BIOLOGICAL MOTHER HAD STANDING TO SEEK VISITATION WITH CHILDREN CONCEIVED BY ARTIFICIAL INSEMINATION; CALIFORNIA MARRIAGE RECOGNIZED UNDER PRINCIPLES OF COMITY)

E-MAILS CONSTITUTED NONACTIONABLE OPINION AND POSTED FLYERS PROTECTED BY COMMON INTEREST PRIVILEGE.

The Second Department, reversing Supreme Court, determined the defendant residential cooperative members and board were entitled to summary judgment in this defamation action. E-mails concerning plaintiff’s behavior and performance on the board were nonactionable expressions of opinion. A flyer indicating which shareholders were alleged to be in arrears was protected by the “common interest” qualified privilege:

“Expressions of an opinion, false or not, libelous or not, are constitutionally protected and may not be the subject of private damage actions'” … . “The issue of distinguishing between actionable fact and non-actionable opinion is a question of law for the court” … . Here, the statements contained in the two emails alleged to be defamatory amounted to subjective characterizations of the plaintiff’s behavior and an evaluation of her performance as a member of the Board, and thus constituted non-actionable expressions of opinion … . Accordingly, the email statements cannot serve as a basis for the imposition of liability.

The defendants further demonstrated that the challenged statements set forth in the “Shareholders In Arrears” flyers posted in the building lobby, which listed the apartment numbers of shareholders who allegedly owed arrears and the amount of those arrears, were protected by the qualified common-interest privilege … . Although a qualified privilege may be lost by proof that the defendant acted out of malice …, in opposition to the defendants’ motion, the plaintiff failed to raise a triable issue of fact as to whether the challenged statements in the flyers were motivated solely by malice … . Galanova v Safir, 2016 NY Slip Op 02617, 2nd Dept 4-6-16

DEFAMATION (E-MAILS CONSTITUTED NONACTIONABLE OPINION AND POSTED FLYERS PROTECTED BY COMMON INTEREST PRIVILEGE)/PRIVILEGE (DEFAMATION, POSTED FLYERS PROTECTED BY COMMON INTEREST PRIVILEGE)/COMMON INTEREST PRIVILEGE (DEFAMATION, POSTED FLYERS PROTECTED BY COMMON INTEREST PRIVILEGE)

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ACKNOWLEDGING DEBT IN BANKRUPTCY PLAN RENEWED THE STATUTE OF LIMITATIONS WHICH STARTED TO RUN UPON GRANT OF DISCHARGE IN BANKRUPTCY.

The Second Department determined the statute of limitations re: a default on a note secured by a mortgage was renewed when defendant (Raudkivi) acknowledged the debt in his bankruptcy plan. The statute therefore began to run when defendant was granted a discharge in bankruptcy, which occurred less than six years before suit was brought:

Raudkivi’s Chapter 13 bankruptcy plan, in which he acknowledged the mortgage debt and promised to repay it, renewed the limitations period (see General Obligations Law § 17-105[1]…). The automatic bankruptcy stay, which was in effect when Raudkivi executed his Chapter 13 bankruptcy plan, tolled the renewed limitations period (see CPLR 204[a]…), so the renewed limitations period did not begin to run until Raudkivi was granted his discharge in bankruptcy in October of 2006 (see 11 USC § 362[c][2][C]). Since this action was commenced less than six years later, in July of 2012, this action is not time-barred. PSP-NC, LLC v Raudkivi, 2016 NY Slip Op 02632, 2nd Dept 4-6-16

DEBTOR-CREDITOR (ACKNOWLEDGING DEBT IN BANKRUPTCY PLAN RENEWED THE STATUTE OF LIMITATIONS WHICH STARTED TO RUN UPON GRANT OF DISCHARGE IN BANKRUPTCY)/BANKRUPTCY (ACKNOWLEDGING DEBT IN BANKRUPTCY PLAN RENEWED THE STATUTE OF LIMITATIONS WHICH STARTED TO RUN UPON GRANT OF DISCHARGE IN BANKRUPTCY)/CIVIL PROCEDURE (ACKNOWLEDGING DEBT IN BANKRUPTCY PLAN RENEWED THE STATUTE OF LIMITATIONS WHICH STARTED TO RUN UPON GRANT OF DISCHARGE IN BANKRUPTCY)

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DETECTIVE SHOULD NOT HAVE BEEN ALLOWED TO TESTIFY AS AN EXPERT ABOUT THE ROLES PLAYED BY THE PEOPLE OVERHEARD IN RECORDED PHONE CALLS IN THIS DRUG CONSPIRACY CASE, ERROR DEEMED HARMLESS HOWEVER.

Although deemed harmless error in this drug conspiracy prosecution, the Second Department determined a detective should not have been allowed to testify (as an expert) about the alleged roles played by people overheard in recorded phone calls:

It was proper to permit the detective to describe certain practices and define certain terms that have a “fixed meaning . . . within the narcotics world” … . However, it was error to permit the prosecutor to elicit testimony as to the roles played by the individuals overheard in the phone calls, and the relationships among them, for example, that several were “runners or workers” for the defendant or codefendant, and the meanings of certain “case-specific” terms that he had discovered in the course of the investigation. As the Court of Appeals cautioned in People v Inoa, where, as here, “the trial court qualifie[s] a government agent, intimately involved in the investigation of the case and development of the prosecution, to testify as an expert,” there is a danger that the agent will end up “testifying beyond any cognizable field of expertise as an apparently omniscient expositor of the facts of the case” (id. at 473), thereby usurping the role of the jury. Also improper was the testimony, elicited by the prosecutor from members of the surveillance teams who observed the defendant and his associates at the locations described in the phone calls, that what they witnessed was consistent with a drug transaction … . Nevertheless, we find that the improperly admitted testimony was harmless, as the proof of the defendant’s commission of the charged crimes was overwhelming, and there is “no significant probability that, but for the error, the verdict . . . would have been less adverse” … . People v Melendez, 2016 NY Slip Op 02667, 2nd Dept 4-6-16

CRIMINAL LAW DETECTIVE SHOULD NOT HAVE BEEN ALLOWED TO TESTIFY AS AN EXPERT ABOUT THE ROLES PLAYED BY THE PEOPLE OVERHEARD IN RECORDED PHONE CALLS IN THIS DRUG CONSPIRACY CASE, ERROR DEEMED HARMLESS HOWEVER)/EVIDENCE (CRIMINAL LAW, DETECTIVE SHOULD NOT HAVE BEEN ALLOWED TO TESTIFY AS AN EXPERT ABOUT THE ROLES PLAYED BY THE PEOPLE OVERHEARD IN RECORDED PHONE CALLS IN THIS DRUG CONSPIRACY CASE, ERROR DEEMED HARMLESS HOWEVER)/EXPERT OPINION (CRIMINAL LAW, DETECTIVE SHOULD NOT HAVE BEEN ALLOWED TO TESTIFY AS AN EXPERT ABOUT THE ROLES PLAYED BY THE PEOPLE OVERHEARD IN RECORDED PHONE CALLS IN THIS DRUG CONSPIRACY CASE, ERROR DEEMED HARMLESS HOWEVER)

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CORPORATE VEIL PIERCED TO ENFORCE JUDGMENTS.

The Second Department determined petitioners were properly granted summary judgment piercing the corporate (Diontech) veil to enforce judgments:

Equity will intervene to pierce the corporate veil and permit the imposition of individual liability on owners for the obligations of their corporations in order to avoid fraud or injustice … . A party seeking to pierce the corporate veil must establish that (1) the owners exercised complete domination of the corporation with respect to the transaction at issue, and (2) such domination was used to commit a fraud or wrong against the party seeking to pierce the corporate veil which resulted in the injury to that party … . The decision whether to pierce the corporate veil in a given instance will depend on the circumstances of the case … .

Here, the petitioners demonstrated their prima facie entitlement to judgment as a matter of law on so much of the petition as sought to pierce Diontech’s corporate veil by submitting evidence showing, inter alia, that the appellants dominated Diontech, that Diontech did not adhere to any corporate formalities such as holding regular meetings and maintaining corporate records and minutes, that the appellants used corporate funds for personal purposes, and that the appellants stripped Diontech of assets as they wound down the business, leaving it without sufficient funds to pay its creditors, including the petitioners… . Matter of Agai v Diontech Consulting, Inc., 2016 NY Slip Op 02646, 2nd Dept 4-6-16

CORPORATION LAW (CORPORATE VEIL PIERCED TO ENFORCE JUDGMENTS AGAINST PRINCIPALS)/CIVIL PROCEDURE (CORPORATE VEIL PIERCED TO ENFORCE JUDGMENTS AGAINST PRINCIPALS)/DEBTOR-CREDITOR (CORPORATE VEIL PIERCED TO ENFORCE JUDGMENTS AGAINST PRINCIPALS)/PIERCING CORPORATE VEIL (CORPORATE VEIL PIERCED TO ENFORCE JUDGMENTS AGAINST PRINCIPALS)

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PLAINTIFF-CONTRACTOR’S FAILURE TO PROVE THE VALUE OF THE WORK PRECLUDED RECOVERY UNDER THE LIEN LAW AND UNDER A QUANTUM MERUIT THEORY; CRITERIA FOR AMENDMENT OF A COMPLAINT TO CONFORM TO TRIAL PROOF DESCRIBED.

In an action to foreclose a mechanic’s lien, the Second Department determined Supreme Court properly allowed amendment of the pleadings to conform with the proof, which was consistent with an action for quantum meruit. Plaintiff contractor was unable to show the value of the work performed, so plaintiff’s Lien Law and quantum meruit actions failed. Similarly, the defendants failed to prove they ended up paying more than the original agreed price for the work. So defendants’ counterclaims for breach of contract and damages failed. With respect to the amendment of the complaint to conform to the proof, and the flaws in plaintiff’s proof of the value of plaintiff’s work, the court wrote:

Pursuant to Lien Law § 3, a contractor who performs labor or furnishes materials for the improvement of real property with the consent, or at the request of, the owner “shall have a lien for the principal and interest, of the value, or the agreed price, of such labor . . . or materials upon the real property improved or to be improved and upon such improvement.” “A lienor may seek amounts due from both written contracts and from change orders for extras, depending on whether the owner gave his consent for the extra work” … . The lienor’s right to recover is limited by the contract price or the reasonable value of the labor and materials provided … . The lienor has the burden of establishing the amount of the outstanding debt by proffering proof either of the price of the contract or the value of labor and materials supplied … .

… [P]laintiff failed to offer bills, invoices, receipts, time sheets, checks, or any other evidence which would establish the cost of materials, work done by subcontractors, or the number of hours he worked on the job and proffered no explanation for his failure to present this evidence. He likewise failed to provide any detailed description of the work performed, the cost of any portion of the work, or the hourly rate at which he valued his labor. Indeed, at trial, the plaintiff admitted that the sum asserted in his lien was only an estimate. … .

Pursuant to CPLR 3025(c), a trial court may permit the amendment of pleadings before or after judgment to conform them to the evidence “upon such terms as may be just” … .Here, although the complaint sought recovery in the form of foreclosure on his mechanic’s lien, at trial, the plaintiff sought to conform the pleadings to the proof and assert a cause of action for recovery in quantum meruit. The Supreme Court granted that motion, and therefore, contrary to the defendants’ contention, that theory of recovery was properly before the court. * * *

Here, although the plaintiff presented evidence satisfying … three elements [of quntum meruit], this cause of action must fail for the same reason that the cause of action to foreclose his mechanic’s lien must fail; namely, his failure to present any evidence of the value of the materials supplied or services rendered. DiSario v Rynston, 2016 NY Slip Op 02611, 2nd Dept 4-6-16

CONTRACT LAW (PLAINTIFF-CONTRACTOR’S FAILURE TO PROVE THE VALUE OF THE WORK PRECLUDED RECOVERY UNDER THE LIEN LAW AND UNDER A QUANTUM MERUIT THEORY)/QUANTUM MERUIT (PLAINTIFF-CONTRACTOR’S FAILURE TO PROVE THE VALUE OF THE WORK PRECLUDED RECOVERY UNDER THE LIEN LAW AND UNDER A QUANTUM MERUIT THEORY)/MECHANIC’S LIEN (PLAINTIFF-CONTRACTOR’S FAILURE TO PROVE THE VALUE OF THE WORK PRECLUDED RECOVERY UNDER THE LIEN LAW AND UNDER A QUANTUM MERUIT THEORY)/LIEN LAW (PLAINTIFF-CONTRACTOR’S FAILURE TO PROVE THE VALUE OF THE WORK PRECLUDED RECOVERY UNDER THE LIEN LAW AND UNDER A QUANTUM MERUIT THEORY)/EVIDENCE (PLAINTIFF-CONTRACTOR’S FAILURE TO PROVE THE VALUE OF THE WORK PRECLUDED RECOVERY UNDER THE LIEN LAW AND UNDER A QUANTUM MERUIT THEORY)/CIVIL PROCEDURE (CRITERIA FOR AMENDMENT OF A COMPLAINT TO CONFORM TO TRIAL PROOF DESCRIBED)/COMPLAINT, AMENDMENT OF (CRITERIA FOR AMENDMENT OF A COMPLAINT TO CONFORM TO TRIAL PROOF DESCRIBED)

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UNLICENSED CONTRACTOR CAN NOT RECOVER UNDER HOME IMPROVEMENT CONTRACT OR IN QUANTUM MERUIT.

The Second Department affirmed the dismissal of plaintiff contractor’s complaint seeking quantum meruit and recovery under the lien law because the contractor did not allege it was duly licensed in Nassau County when the home improvement services were rendered:

” An unlicensed contractor may neither enforce a home improvement contract against an owner nor seek recovery in quantum meruit'” … . “Pursuant to CPLR 3015(e), a complaint that seeks to recover damages for breach of a home improvement contract or to recover in quantum meruit for home improvement services is subject to dismissal under CPLR 3211(a)(7) if it does not allege compliance with the licensing requirement” … .

Here, the complaint did not allege that the plaintiff was duly licensed in Nassau County at the time of the services rendered (see Nassau County Administrative Code § 21-11.2). Moreover … the plaintiff conceded that it did not possess the necessary license. Therefore, the plaintiff was not entitled to enforce its contract against the defendant or to recover in quantum meruit … . Holistic Homes, LLC v Greenfield, 2016 NY Slip Op 02619, 2nd Dept 4-6-16

CIVIL PROCEDURE (UNLICENSED CONTRACTOR CAN NOT RECOVER UNDER HOME IMPROVEMENT CONTRACT OR IN QUANTUM MERUIT)/CONTRACT LAW  (UNLICENSED CONTRACTOR CAN NOT RECOVER UNDER HOME IMPROVEMENT CONTRACT OR IN QUANTUM MERUIT)/LIEN LAW (UNLICENSED CONTRACTOR CAN NOT RECOVER UNDER HOME IMPROVEMENT CONTRACT OR IN QUANTUM MERUIT)/CONTRACT LAW (UNLICENSED CONTRACTOR CAN NOT RECOVER UNDER HOME IMPROVEMENT CONTRACT OR IN QUANTUM MERUIT)/MECHANIC’S LIEN (UNLICENSED CONTRACTOR CAN NOT RECOVER UNDER HOME IMPROVEMENT CONTRACT OR IN QUANTUM MERUIT)/QUANTUM MERUIT (UNLICENSED CONTRACTOR CAN NOT RECOVER UNDER HOME IMPROVEMENT CONTRACT OR IN QUANTUM MERUIT)

DEFENDANTS WAIVED ANY OBJECTION TO PLAINTIFF’S ATTORNEY BY PARTICIPATING IN THE LITIGATION FOR MORE THAN TWO YEARS AND EIGHT MONTHS WITH KNOWLEDGE OF THE ALLEGED CONFLICT OF INTEREST.

The Second Department determined the Brach defendants' motion to disqualify counsel for the plaintiff limited-liability-company (Goldberg) was properly denied. Plaintiff sued defendant Brach, a member of the company, alleging Brach violated his duties to the company. After more than two years and eight months of litigation, the Brach defendants moved to disqualify Goldberg, alleging a conflict of interest. The Brach defendants were aware of the alleged conflict from the beginning. Therefore the Brach defendants had waived any objection to Goldberg's representation. The Second Department explained the relevant law:

“Where a party seeks to disqualify counsel of an adversary in the context of ongoing litigation, courts consider when the challenged interests became materially adverse to determine if the party could have moved at an earlier time” … . If the party moving for disqualification knew or should have known of the facts underlying the alleged conflict of interest for a prolonged period before bringing the motion, that party may be found to have waived any objection to the other party's representation … . Further, where a motion to disqualify is brought in the middle of litigation where the moving party was aware of the alleged conflict of interest well before bringing the motion, it can be inferred that the motion was made to secure a tactical advantage … . Ike & Sam's Group, LLC v Brach, 2016 NY Slip Op 02620, 2nd Dept 4-6-16


FAILURE TO DEMONSTRATE WHEN AREA WAS LAST CLEANED OR INSPECTED REQUIRED DENIAL OF DEFENDANT’S MOTION FOR SUMMARY JUDGMENT IN THIS SLIP AND FALL CASE.

The Second Department determined defendant's motion for summary judgment in a slip and fall case was properly denied. The defendant failed to demonstrate when the area was last cleaned and inspected. Evidence of routine maintenance is not enough:

Here, although the defendant's evening maintenance employee testified at his deposition about his regular cleaning routine for the building, he had no independent recollection of having cleaned the floor in question on the date of the plaintiff's accident. Furthermore, no deposition testimony was provided describing the condition of the floor in question on the date of the accident, including whether the maintenance employee had observed a water condition upon it. Since the defendant did not submit evidence regarding any specific inspection or cleaning of the area on the date of the accident, the defendant failed to establish that it did not have constructive notice of the alleged dangerous condition … . The defendant's submissions also failed to eliminate all triable issues of fact as to whether it created the alleged dangerous condition … . Ansari v MB Hamptons, LLC, 2016 NY Slip Op 02305, 2nd Dept 3-30-16

NEGLIGENCE (SLIP AND FALL, FAILURE TO DEMONSTRATE WHEN AREA WAS LAST CLEANED OR INSPECTED REQUIRED DENIAL OF DEFENDANT'S MOTION FOR SUMMARY JUDGMENT)/SLIP AND FALL (FAILURE TO DEMONSTRATE WHEN AREA WAS LAST CLEANED OR INSPECTED REQUIRED DENIAL OF DEFENDANT'S MOTION FOR SUMMARY JUDGMENT)/CONSTRUCTIVE NOTICE (SLIP AND FALL, FAILURE TO DEMONSTRATE WHEN AREA WAS LAST CLEANED OR INSPECTED REQUIRED DENIAL OF DEFENDANT'S MOTION FOR SUMMARY JUDGMENT)

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