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Supreme Court Erred In Refusing to Appoint a Guardian—However, Petitioner Was Not the Appropriate Choice for the Guardian

Reversing Supreme Court, the Second Department determined the appointment of a guardian for Mae R, who was 91, was necessary. The Second Department further found that the petitioner was not the appropriate choice for a guardian.  [In addition, the court noted that, in absence of bad faith, it was an abuse of discretion for Supreme Court to order petitioner to pay the fees for the court evaluator and appointed attorney.]  The court explained the relevant law and the facts:

Under Mental Hygiene Law article 81, a court may appoint a guardian for a person or a person's property upon determining, by clear and convincing evidence, that the requirements of article 81 have been met (see Mental Hygiene Law §§ 81.02[a][2], 81.12[a]…). Before a court may appoint a guardian, it must determine (1) that a guardian is “necessary to provide for the personal needs of that person, including food, clothing, shelter, health care, or safety and/or to manage the property and financial affairs of that person”; and (2) that “the person agrees to the appointment, or that the person is incapacitated” within the meaning of the statute (Mental Hygiene Law § 81.02[a][1], [2]…). The statute specifies the relevant considerations and issues in the determination of the need for a guardian, and expressly requires that the court consider the report of the court evaluator (see Mental Hygiene Law § 81.02[a]) and the “sufficiency and reliability of available resources” that may satisfy the needs of the proposed ward without requiring the appointment of a guardian (Mental Hygiene Law § 81.02[a][2]…). Even where the court finds that appointment of a guardian is necessary, it is not required to appoint the person proposed by the petitioner … .

Here, contrary to the Supreme Court's determination, which rejected the recommendation of the court evaluator, the petitioner demonstrated by clear and convincing evidence that Mae R. is an incapacitated person as defined in Mental Hygiene Law § 81.02(b). The evidence at the hearing established that Mae R., a 91-year-old woman who presently resides by herself in her two-family home in Queens, is likely to suffer harm because she is unable to provide for her personal needs and manage her property, and does not adequately understand and appreciate the nature and consequences of her limited abilities (see Mental Hygiene Law § 81.02[b][1], [2]…).

The evidence established, among other things, that, until recently, Mae R. managed her person and property with the daily assistance of a tenant who previously resided with her, and Mae R.'s grandniece, both of whom testified at the hearing and were interviewed by the court evaluator. The evidence further established that, subsequently, Mae R. executed a health care proxy and power of attorney in favor of a neighbor, and a last will and testament bequeathing her entire estate to this neighbor, who procured the attorney who drafted the alleged directives and testamentary instrument. At an interview with the court-appointed evaluator, however, Mae R. did not recall issuing the directives and testamentary instrument. Indeed, she told the court-appointed evaluator that she wished to leave her estate to family members. Further, witnesses at the hearing had heard Mae R. say that the same neighbor “makes me say things I don't mean and then I forget.” Matter of Loftman …, 2014 NY Slip Op 08998, 2nd Dept 12-24-14

 

If the Accident Was Staged by the Insured, the Insurer Would Not Be Required to Cover a Party Injured In the Collision, Even If that Party Was Not Involved in the Staging

Reversing Supreme Court, the Second Department determined that the insurer could disclaim coverage if the accident was staged by the insured (Robinson), even with respect to a party not shown to have been involved in the staging (Pontoon).  Here Robinson's vehicle side-swiped the vehicle in which Pontoon was a passenger:

Robinson's vehicle was covered under an automobile liability insurance policy issued by the proposed additional respondent Government Indemnity Company (hereinafter GEICO). Pontoon sought coverage for the incident from GEICO. GEICO disclaimed coverage on the ground, inter alia, that the collision was staged, and thus resulted from an intentional act. Pontoon then sought arbitration under the uninsured motorist provision of Nelson's policy, which was issued by Nationwide General Insurance Company (hereinafter Nationwide). Nationwide initiated this proceeding under CPLR article 75 seeking to permanently stay the arbitration on the ground that GEICO was required to provide coverage for Pontoon's injuries, and thus Robinson was not “uninsured.” * * *

The referee incorrectly concluded that GEICO was required to submit evidence that Pontoon was involved in staging the collision in order to support a disclaimer of coverage. Contrary to the referee's conclusion, if GEICO can prove that the collision was staged by Robinson, its insured, it would not be obligated to provide coverage under the policy regardless of whether Pontoon was an innocent third party … . Nationwide Gen Ins v Pontoon, 2014 NY Slip OP 09001, 2nd Dept 12-24-14

 

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2 1/2 Year Delay In Correcting Location of the Slip and Fall Described in the Notice of Claim Prejudiced the Defendant/Motion for Leave to File an Amended Notice Properly Denied

The Second Department determined plaintiffs' motion to amend the notice of claim to change the location of the accident (slip and fall on ice and snow) was properly denied. Although the error was not made in bad faith, the 2 1/2 year delay in correcting the error prejudiced the defendant town agency:

Pursuant to General Municipal Law § 50-e(6), a court has discretion to grant leave to serve an amended notice of claim where the error in the original notice was made in good faith and where the other party has not been prejudiced thereby … . Here, while there is no indication that the error regarding the location of the subject accident in the original notice of claim was made in bad faith, the record demonstrates prejudice to the respondent, the defendant Town of Babylon Industrial Development Agency (hereinafter the Agency), as a result of the error. The original notice of claim misidentified the location of the accident as the “walkway/pathway” in front of 595 Smith Street, East Farmingdale, rather than the correct location, the “roadway/parking lot” at 540 Smith Street, East Farmingdale. Furthermore, the subsequent complaint, bill of particulars, photographs of the purported accident location, supplemental bill of particulars, and even a second supplemental bill of particulars served almost 2½ years after the accident, all of which continued to misidentify the accident location, failed to dissipate the prejudice to the Agency in its attempt to conduct a timely and meaningful investigation … . The plaintiffs contend that the Agency's ability to conduct a physical examination of the snow and ice condition that allegedly caused the injured plaintiff's accident was not affected by the error in the notice of claim, since that condition undoubtedly had changed by the time the original notice was served. However, the record reveals that the Agency's ability to investigate other aspects of the occurrence and to interview witnesses was hampered by the plaintiffs' delay of more than 2½ years in serving a third supplemental bill of particulars identifying the correct accident location and in moving for leave to serve an amended notice of claim … . Torres v Town of Babylon, 2014 NY Slip Op 08901, 2nd Dept 12-24-14

 

Emergency Doctrine Does Not Apply Where Party Invoking It Contributed to the Creation of the Emergency

The Second Department affirmed Supreme Court's ruling that the emergency doctrine did not apply to the defendant (Smith). Defendant crossed over the grassy median from the southbound lane striking plaintiff's vehicle in the northbound lane. Defendant argued that the emergency doctrine applied because defendant's vehicle was struck from behind, causing it to leave its lane of traffic.  The Second Department determined the emergency doctrine did not apply because defendant contributed to the rear-end collision by slowing down without signaling at a time when defendant was aware the vehicle behind was tail-gating:

…[T]he defendants failed to raise a triable issue of fact as to whether the emergency doctrine applied … . The emergency doctrine is not a defense available to the defendants because the emergency condition was partially created by Smith's disregard of existing traffic conditions … . Smith had a duty not to stop suddenly or slow down without proper signaling so as to avoid a collision … . At his deposition, Smith admitted that he was aware that the unidentified vehicle had been tailgating him for about 10 to 20 seconds. Despite being aware that he was being tailgated on a highway, he deliberately slowed his vehicle by disengaging the cruise control without proper signaling. Then, the unidentified vehicle hit the rear of his vehicle. Under these circumstances, it was foreseeable that slowing down without proper signaling could result in a rear-end collision. Accordingly, as Smith contributed to the creation of the emergency situation, the emergency doctrine is not applicable. Pearson v Northstar Limousine Inc, 2014 NY Slip Op 08968, 2nd Dept 12-24-14

 

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Bank Properly Reversed Wire Transfer to Plaintiff’s Account After Learning Payment Was Not Authorized by the Holder of the Account from Which the Money Was Transferred—Plaintiff, Which Had Provided the Fake Buyer with Products Ostensibly Purchased with the Funds Initially Transferred to Plaintiff’s Account, Was Not Entitled to Those Funds Because the Funds Had Been Properly Returned by the Defendant Banks Pursuant to the Wire-Transfer Provisions of the UCC

The Second Department determined summary judgment in favor of the defendant banks (TD Bank and Eastern Bank) was properly granted.  Plaintiff, Golden Door, sold watches worth $71,000 to a fake buyer after the money was wired from the ostensible buyer's (MHIC's) account at defendant Eastern Bank to plaintiff's account in defendant TD Bank.  It turned out that the wire transfer was the result of the “hacking” of ostensible buyer's account. When Eastern Bank was notified the buyer had not authorized the transfer, Eastern Bank notified TD Bank which then reversed the transfer of the $71,000. Plaintiff sued for the $71,000.  The Second Department found that, under the wire-transfer provisions of the UCC, plaintiff was not entitled to the $71,000:

Under Article 4-A, a funds transfer is initiated by a “payment order,” which is an instruction from the person making the payment (the “originator”), to a “receiving” or “intermediary” bank to transfer the funds to the bank account of the beneficiary, normally in the “beneficiary's bank” (UCC 4-A-103, 4-A-104). Here, MHIC was indicated as the originator, Eastern Bank was the receiving bank, Golden Door was the beneficiary, and TD Bank was the beneficiary's bank.

Under Article 4-A, “a beneficiary's bank accepts a payment order when the bank pays the beneficiary by crediting the beneficiary's account and notifying the beneficiary of the right to withdraw the credit” (…see UCC 4-A-209[a]; 4-A-405[1][i]). Once the beneficiary's bank accepts the payment order, a cancellation of the order is not effective unless the beneficiary's bank agrees and, as relevant here, the order was unauthorized in the first place (see UCC 4-A-211[3][b]…). “If the payment order is cancelled . . . the beneficiary's bank is entitled to recover from the beneficiary any amount paid to the beneficiary to the extent allowed by the law governing mistake and restitution” (UCC 4-A-211[3][b]). Once cancelled, “the acceptance [of the payment order] is nullified and no person has any right or obligation based on the acceptance” (UCC 4-A-211[5], Comment 4, Case #1).

In support of their motion for summary judgment dismissing the complaint, the defendants established prima facie that the cancellation of the payment order was effective. The defendants submitted evidence that TD Bank, the beneficiary's bank, agreed to the cancellation, and that MHIC had not authorized the transfer (see UCC 4-A-211[3][b], Comment 1). The defendants further established prima facie that TD Bank was authorized to recover payment from Golden Door in the amount of the cancelled transfer in accordance with the “law governing mistake and restitution” (UCC 4-A-211[3][b]). The applicable doctrine of restitution is the “discharge for value” rule. Under that rule, ” [a] creditor of another or one having a lien on another's property who has received from a third person any benefit in discharge of the debt or lien, is under no duty to make restitution therefor, although the discharge was given by mistake of the transferor as to his interests or duties, if the transferee made no misrepresentation and did not have notice of the transferor's mistake'” (…quoting Restatement of Restitution § 14[1]). Although Golden Door had made no misrepresentation, the defendants established that Golden Door had notice that the transfer from MHIC was given by “mistake,” or was unauthorized. Specifically, the transfer order indicated that the transferor was MHIC, which was not Golden Door's “customer,” was not indebted to Golden Door, and had no apparent relationship with it or its “customer” (see UCC 4-A-211, Comment 4, Cases #2-#4…). Accordingly, Golden Door could not, under the discharge for value rule, retain the funds that had been transferred into its account. In opposition to the defendants' prima facie showing, Golden Door failed to raise a triable issue of fact. Golden Door V & I Inc v TD Bank, 2014 NY Slip Op 08960, 2nd Dept 12-24-14


 

Although There Was Evidence the Plaintiff Failed to Yield the Right-of-Way, There Was a Triable Question of Fact Whether Defendant Could Have Taken Steps to Avoid the Collision

The Second Department reversed Supreme Court finding that, although there was evidence failed to yield the right-of-way in violation of Vehicle & Traffic Law 1142 (a), defendant (Tiao) failed to demonstrate the absence of comparative fault on his part:

A driver who has the right-of-way is entitled to anticipate that other drivers will obey traffic laws that require them to yield (see Vehicle and Traffic Law § 1141…). Moreover, a driver is negligent where he has failed to see that which through proper use of his senses he should have seen … . At the same time, a driver traveling with the right-of-way may nevertheless be found to have contributed to the happening of the accident if he or she did not use reasonable care to avoid the accident … . “There can be more than one proximate cause of an accident” …, and the issue of comparative fault is generally a question for the jury to decide … . Thus, a movant seeking summary judgment is required to make a prima facie showing that he or she is free from comparative fault … .

In support of their motion, the defendants relied upon, inter alia, the deposition transcripts of the plaintiff and Tiao. While the defendants submitted evidence that the plaintiff failed to yield the right-of-way to their vehicle in violation of Vehicle and Traffic Law § 1142(a), their submissions in support of their motion failed to establish Tiao’s freedom from comparative fault and that the plaintiff’s violation was the sole proximate cause of the accident… . Tiao recalled at his deposition that, prior to entering the intersection, when he was about five to eight feet therefrom, he observed the plaintiff’s vehicle stopped at the stop sign on 72nd Street. Thereafter, he testified that three to four seconds elapsed between his seeing the plaintiff’s vehicle initially and the collision. Tiao did not testify as to the movement of the plaintiff’s vehicle from the point he initially observed it to the point of impact between the vehicles, and he admitted that he could not recall where he was looking at the point of impact. He further admitted that he did not take any evasive action to avoid the impact with the plaintiff’s vehicle in the intersection. Based on Tiao’s testimony, the defendants failed to eliminate all triable issues of fact as to whether Tiao took reasonable care to avoid the collision with the plaintiff’s vehicle in the intersection… . Arias v Tiao, 2014 NY Slip Op 08796, 2nd Dept 12-17-14

Similar issue and result in Canales v Arichabala, 2014 NY Slip Op 08803, 2nd Dept 12-17-14

 

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Elevator Company Which Agrees to Keep Elevator in a Safe Operating Condition May Be Liable to Injured Passenger

The Second Department reversed Supreme Court finding an elevator company which agreed to maintain an elevator in a safe condition may be liable to an injured passenger:

“An elevator company which agrees to maintain an elevator in safe operating condition may be liable to a passenger for failure to correct conditions of which it has knowledge or failure to use reasonable care to discover and correct a condition which it ought to have found” … . Here, the defendant submitted maintenance records for the subject elevator, including work tickets for a period of approximately one year preceding the plaintiff’s accident and a “callout report,” which indicated that approximately six months before the accident, the defendant was called to repair the alarm bell. The defendant also submitted the plaintiff’s deposition transcript, wherein he testified that, prior to his accident, there were times when the alarm bell and strobe light did not activate and that two other individuals had been struck on the head by the gate prior to his accident. Thus, the defendant’s submissions failed to establish, prima facie, that it did not have actual or constructive notice concerning the defective operation of the elevator’s gate, alarm bell, and strobe light … . Since the defendant failed to establish its prima facie entitlement to judgment as a matter of law, its motion should have been denied regardless of the sufficiency of the plaintiff’s opposition papers … . Papapietro v Knoe Inc, 2014 NY Slip Op 08817, 2nd Dept 12-17-14

 

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Abutting Landowners Are Not Required, Pursuant to the NYC Administrative Code, to Remove Ice and Snow from Pedestrian Ramps—The Ramps Are Not Part of the Sidewalk

In reversing Supreme Court, the Second Department explained that pedestrian ramps are not part of the sidewalk and therefore abutting landowners are not required to remove ice and snow from a pedestrian ramp:

“Administrative Code of the City of New York § 7-210, which became effective September 14, 2003, shifted tort liability for injuries arising from a defective sidewalk from the City of New York to the abutting property owner” … . “However, pedestrian ramps are not part of the sidewalk for the purpose of imposing liability on abutting landowners pursuant to that provision” … . Stanziale v City of New York, 2014 Slip Op 08825, 2nd Dept 12-17-14

 

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Question of Fact Raised About Whether Contract for the Installation of Marble Staircase Landings Gave Rise to Tort Liability to Third Party (Plaintiff) Stemming from the Collapse of a Landing

The Second Department determined a question of fact had been raised about whether a contract for the installation of marble staircase landings (by defendant Suli) gave rise to tort liability for injury to plaintiff resulting from the collapse of the landing:

Ordinarily, the breach of a contractual obligation is not sufficient in and of itself to impose tort liability upon the promisor to noncontracting parties … . However, a party who enters into a contract to render services may be said to have assumed a duty of care and, thus, would be potentially liable in tort to third persons when the contracting party, in failing to exercise reasonable care in the performance of its duties, launches an instrument of harm or creates or exacerbates a hazardous condition … . Here, Suli demonstrated its prima facie entitlement to judgment as a matter of law by presenting evidence that it properly installed the marble slab, that it never received any complaints about the work prior to the accident, and that no defects in the marble were observed prior to the accident. However, in opposition, the plaintiff and the building defendants raised a triable issue of fact as to whether Suli created the hazardous condition that caused the accident through the affidavit of an experienced marble setter and installer. That expert explained that marble could weaken over time due to stress fractures, and opined that Suli should have supported the marble slab with an additional “angle iron” in the center of the slab, and that Suli’s failure to do so was a substantial contributing factor in the happening of the accident … . Torres v 63 Perry Realty LLC, 2014 NY Slip Op 08830, 2nd Dept 12-17-14

 

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Condition Precedent to Arbitration Re: a Hit-and-Run Accident Involving an Unidentified Vehicle Is Physical Contact with Unidentified Vehicle—Lack of Proof of Physical Contact Justified Permanent Stay of Arbitration

The Second Department noted that a condition precedent to an arbitration based upon a hit-and-run accident involving an unidentified vehicle is physical contact.  Here there was insufficient evidence of physical contact with the unidentified vehicle:

The appellant sought uninsured motorist benefits under a policy of insurance issued by the petitioner for physical injuries allegedly sustained by him in a hit-and-run accident. The petitioner commenced this proceeding pursuant to CPLR article 75 to permanently stay arbitration of the claim.

Physical contact is a condition precedent to an arbitration based upon a hit-and-run accident involving an unidentified vehicle (see Insurance Law § 5217…). “The insured has the burden of establishing that the loss sustained was caused by an uninsured vehicle, namely, that physical contact occurred, that the identity of the owner and operator of the offending vehicle could not be ascertained, and that the insured’s efforts to ascertain such identity were reasonable” … . Matter of Progressive Northwestern Ins Co v Scott, 2014 NY Slip Op 08847, 2nd Dept 12-17-14

 

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