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Son of Sam Law Required Murderer’s Police Pension Be Paid to Daughter and Estate of the Murder Victim

The Second Department determined that the “Son of Sam Law” required that the pension to which a convicted murderer was entitled be paid to the estate of the murder victim.  The plaintiff is the daughter of the murder victim.  The murderer is plaintiff’s father. The father fraudulently transferred his pension rights to his second wife.  Plaintiff, individually and as the administrator of her mother’s estate, procured a wrongful death judgment against her father. The court affirmed Supreme Court’s ruling that the transfer of the pension to the father’s second wife was fraudulent under Florida law (where the transfer was made) and the “Son of Sam Law” trumped the Retirement and Social Security Law such that the father’s pension was payable to the plaintiff:

“Under the full faith and credit clause . . . , where collateral attack on the ground of fraud would be permitted in the courts of the foreign State in which the judgment had been rendered, our courts will entertain a similar challenge” … . Here, Florida law permits a collateral attack on the defendant’s transfer of his pension to [second wife] on the ground that it constituted a fraudulent transfer … . * * *

Next, we reject [the second wife’s] contention that the defendant’s pension is not subject to execution or attachment by virtue of section 110(2) of the Retirement and Social Security Law or under certain provisions of the Administrative Code of the City of New York (see Administrative Code of City of NY §§ 13-181, 13-212, 13-264). As [the second wife] correctly contends, section 110(2) of the Retirement and Social Security Law provides that the right of a person to a pension “[s]hall not be subject to execution, garnishment, attachment, or any other process whatsoever” (Retirement and Social Security Law § 110[2]). In 2001, however, the Legislature amended the Son of Sam law to subject the “[f]unds of a convicted person” to an action for damages by a crime victim, a crime victim’s representative, or certain other persons (L 2001, ch 62, § 1; see Executive Law § 632 a[1][a], [c], [d]; [3]). The phrase “funds of a convicted person” was broadly defined as “all funds and property received from any source” (Executive Law § 632 a[1][c] [emphasis added]).

We conclude, for the reasons stated by our colleagues in the Appellate Division, [3rd] Department [97 AD3d 235]…, that the defendant’s pension is subject to execution under the Son of Sam law. Both the clear statutory language and the legislative history of the 2001 amendments to the Son of Sam law evince the Legislature’s intent to permit crime victims to recover assets from convicted persons, including pensions, regardless of the source of the convicted person’s funds … . As the [3rd] Department concluded, a contrary holding would “directly thwart[ ] the Legislature’s stated intent of holding convicted criminals financially … . Kane v Galtiere, 2014 NY Slip Op 07476, 2nd Dept 11-5-14

 

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Purchase of Property Encumbered by an Unsatisfied Mortgage Gave Rise to Negligence, Negligent Misrepresentation, Fraud, and Civil Conspiracy Causes of Action Against Title Insurance Company

Third-party plaintiff, Drummond, purchased property that was encumbered by an unsatisfied mortgage held by plaintiff bank. Drummond sued the title company, third-party defendant New York Land, as well as the company from which she procured her mortgage, Residential, and the bank to which the mortgage was transferred, Wells Fargo.  The third-party defendants brought CPLR 3211 motions to dismiss. The Second Department determined the causes of action against New York Land for negligence and negligent misrepresentation properly survived a motion to dismiss because the relationship between Drummond and New York Title was “so close as to approach privity,” but no such relationship was demonstrated with Residential and Wells Fargo.  The Second Department further determined the fraud and civil conspiracy causes of action against New York Land should not have been dismissed, explaining the pleading requirements. In addition, the Second Department determined that the suit was not “consumer-related” and therefore the General Business Law 349 cause of action was properly dismissed:

Although there was no contract between Drummond and New York Land, affording the pleadings a liberal construction and accepting all facts alleged as true …, the third-party complaint supports Drummond’s contention that the relationship between these two parties was so close as to approach privity .. . Indeed, the pleading alleges that New York Land was aware that the abstract and title report that it prepared were to be used for the specific purpose of facilitating a sale or mortgage of the property, that New York Land knew that Drummond was a member of a definable class who would rely on the certification in furtherance of that purpose, and that there was conduct between New York Land and Drummond evincing New York Land’s understanding of Drummond’s reliance … . Accordingly, the Supreme Court properly denied those branches of New York Land’s motion which were to dismiss, for failure to state a cause of action, the third-party causes of action alleging negligence and negligent misrepresentation insofar as asserted against it. * * *

“The elements of a cause of action sounding in fraud are a material misrepresentation of an existing fact, made with knowledge of the falsity, an intent to induce reliance thereon, justifiable reliance upon the misrepresentation, and damages” … . “All of the elements of a fraud claim must be supported by factual allegations containing the details constituting the wrong’ in order to satisfy the pleading requirements of CPLR 3016(b)” … . In certain circumstances, however, it may be “almost impossible to state in detail the circumstances constituting a fraud where those circumstances are peculiarly within the knowledge of [an adverse] party” … . “Under such circumstances, the heightened pleading requirements of CPLR 3016(b) may be met when the material facts alleged in the complaint, in light of the surrounding circumstances, are sufficient to permit a reasonable inference of the alleged conduct’ including the adverse party’s knowledge of, or participation in, the fraudulent scheme” … . Here, accepting all facts alleged as true … , the third-party complaint contains sufficient allegations of fact from which it can be inferred that New York Land was aware of the alleged fraudulent scheme and intended to aid in the commission thereof … . * * *

“Although New York does not recognize civil conspiracy to commit a tort . . . as an independent cause of action, a plaintiff may plead the existence of a conspiracy in order to connect the actions of the individual defendants with an actionable, underlying tort and establish that those actions were part of a common scheme” … . Again, affording the third-party complaint a liberal construction, Drummond alleged sufficient facts from which it may be inferred that New York Land knowingly participated, with certain other third-party defendants, in the alleged fraudulent scheme … . * * *

General Business Law § 349 is a broad consumer protection statute, which declares “deceptive acts or practices in the conduct of any business, trade or commerce” to be unlawful (General Business Law § 349[a]…). A party claiming the benefit of General Business Law § 349 must, as a threshold matter, ” charge conduct that is consumer oriented'” … . “The single shot transaction, which is tailored to meet the purchaser’s wishes and requirements, does not, without more, constitute consumer-oriented conduct for the purposes of this statute” … . Rather, the defendant’s acts or practices “must have a broad impact on consumers at large” … . Here, Drummond’s General Business Law § 349 cause of action is predicated upon allegations that the third-party defendants fraudulently induced her to purchase the subject property and finance it with a mortgage loan from [Residential]. As the Supreme Court properly concluded, these factual allegations do not amount to conduct that has an impact on the public at large and, as such, do not state a cause of action for violation of General Business Law § 349 … . JP Morgan Chase Bank NA v Hall, 2014 NY Slip Op 07475, 2nd Dept 11-5-14

 

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Motion to Dismiss Pursuant to CPLR 3211 (a)(1) [Documentary Evidence] Should Not Have Been Granted—Plaintiff Rebutted the Presumption of Validity of the Forum Selection Clause of the Relevant Contract

The Second Department determined Supreme Court should not have granted defendants’ motion to dismiss based upon the forum selection clause in the relevant contract.  Plaintiff rebutted the presumption of the validity of the clause:

A party seeking dismissal of a complaint under CPLR 3211(a)(1) must submit documentary evidence that ” conclusively establishes a defense to the asserted claims as a matter of law'” … . A contract provision may constitute documentary evidence under CPLR 3211(a)(1) …, and a forum selection clause contained in a contract may provide a proper basis for dismissal of a complaint under CPLR 3211(a)(1) … . A forum selection clause is “prima facie valid and enforceable unless it is shown by the challenging party to be unreasonable, unjust, in contravention of public policy, invalid due to fraud or overreaching, or it is shown that a trial in the selected forum would be so gravely difficult that the challenging party would, for all practical purposes, be deprived of its day in court” … . Accordingly, a forum selection clause will be given effect in the absence of a ” strong showing'” that it should be set aside … .

Here, the plaintiff has made the requisite strong showing that the forum selection clause in the nondisclosure agreement was “unreasonable.” Specifically, the plaintiff has contended, without contradiction, that neither the parties nor the agreement has any connection to the State of Delaware: none of the parties is located in Delaware, the nondisclosure agreement was not executed in Delaware, and performance of the agreement was not to take place in Delaware … . Accordingly, the prima facie enforceability and validity of the forum selection clause has been rebutted and, therefore, that clause does not “conclusively establish[ ] a defense to the asserted claims as a matter of law”… . US Mdse Inc v L & R Distribs Inc, 2014 NY Slip Op 07495, 2nd Dept 11-5-14

 

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Presumption Vehicle Was Operated with Owner’s Consent Not Overcome—Defendant Not Entitled to Summary Judgment

The Second Department determined the defendant was not entitled to summary judgment on the ground that the unknown driver of defendant’s vehicle did not have the defendant’s consent to operate the vehicle:

Vehicle and Traffic Law § 388 creates a strong presumption that the driver of a vehicle is operating it with the owner’s consent, which can only be rebutted by substantial evidence demonstrating that the vehicle was not operated with the owner’s express or implied permission … . The defendant, on its motion for summary judgment, has the burden of demonstrating its prima facie entitlement to judgment as a matter of law … . Thus, to obtain summary judgment on its defense that the vehicle was used without its permission, the defendant was required to present substantial evidence that the vehicle was used without its permission … . “The uncontradicted testimony of a vehicle owner that the vehicle was operated without his or her permission, does not, by itself, overcome the presumption of permissive use” … . The question of consent is ordinarily one for the jury … . Ultimately, “whether summary judgment is warranted depends on the strength and plausibility of the disavowals [of permission], and whether they leave room for doubts that are best left for the jury” …

Here, the defendant failed to sufficiently rebut the strong presumption that the driver was operating the subject vehicle with its permission. The deposition testimony of the defendant and some, but not all, of its employees that the driver only had permission to drive the vehicle for work-related purposes did not, by itself, overcome the presumption of permissive use … . In addition, the defendant failed to establish that the vehicle was stolen … . Han v BJ Laura & Son Inc, 2014 NY Slip Op 07480, 2nd Dept 11-5-14

 

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Damages for “Loss of Fetus” Under Insurance Law 5102 Are Not Available When the Baby Is Born Alive

The Second Department determined that the “loss of fetus” provision of Insurance Law 5102 did not apply to the birth of a live child allegedly induced by a car accident:

[Plaintiff] was pregnant at the time of the accident, and she alleges that she suffered a placental abruption which caused her son, the infant plaintiff, to be born prematurely and delivered by caesarean section. * * *

The defendants subsequently moved, inter alia, for summary judgment dismissing so much of the complaint as alleged that [plaintiff], individually, sustained a serious injury under the “loss of a fetus” category of Insurance Law § 5102(d) as a result of the subject accident * * *. …[T]he Supreme Court concluded, in essence, that the phrase “loss of a fetus” encompassed any termination of a pregnancy caused by an accident, regardless of whether the fetus was born alive.

In cases involving statutory construction, legislative intent is the controlling principle … . “The Court’s threshold inquiry in this regard is how to discern the legislative intent. When an enactment displays a plain meaning, the courts construe the legislatively chosen words so as to give effect to that Branch’s utterance” … . Contrary to the Supreme Court’s determination, the plain meaning of the term “loss of a fetus” does not include the premature birth of a living child. Rather, this category of damages is applicable where, as a result of an automobile accident, a viable pregnancy terminates with loss of the fetus … .

We note that this determination is consistent with legislative history, which reveals that the “loss of a fetus” category was added to Insurance Law § 5102(d) in 1984 in response to Raymond v Bartsch (84 AD2d 60). In that case, the Appellate Division, [3rd] Department, held that Insurance Law § 5102(d), as then constituted, did not permit a woman, who was nine months pregnant at the time of her accident, to recover damages resulting from her delivery of a stillborn baby. The “loss of a fetus” category was added to the statute in recognition that “[a] woman who is involved in an automobile accident that results in the termination of her pregnancy has suffered a serious injury and should have the right to recover from a negligent operator for her non-economic loss” (Sponsor’s Mem, Bill Jacket, L 1984, ch 143). The policy considerations underlying the 1984 amendment of Insurance Law § 5102(d) are not implicated when a child is born alive. Leach v Ocean Black Car Corp, 2014 NY Slip Op 07477, 2nd Dept 11-5-14

 

Criteria for Allowing Late Claim Described

The Second Department determined the Court of Claims should have granted claimant’s request to file a late claim:

Court of Claims Act § 10(6) permits a court, in its discretion, upon consideration of the enumerated factors, to allow a claimant to file a late claim … . “No one factor is deemed controlling, nor is the presence or absence of any one factor determinative” … .

Here, the Court of Claims improvidently exercised its discretion in denying that branch of the claimants’ motion which was for leave to file a late claim on behalf of the claimant … . It is undisputed that the State received actual notice of the essential facts constituting the claim within 90 days after the claimant[‘s] …  accident, and there is no indication that the State would suffer substantial prejudice if the claimants were permitted to file a late claim … . Furthermore, notwithstanding the existence of a factual issue as to which governmental entity bears responsibility for maintenance of the roadway and guardrail where the accident occurred, the claimants’ submissions were sufficient, at this point, to demonstrate that there appears to be merit to their claim within the meaning of Court of Claims Act § 10(6) … . Tucholski v State of New York, 2014 NY Slip Op 07494, 2nd Dept 11-5-14

 

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Where Deportation As a Result of a Guilty Plea Is Not Mentioned by the Court, Preservation of the Error Is Not Required

The Second Department noted that, where the court does not mention the prospect of deportation as a result of a guilty plea, the error need not be preserved and the defendant should be given the opportunity to demonstrate to the court the guilty plea would not have been entered if the possibility of deportation were known. People v Al-Mulwallad, 2014 NY Slip OP 07361, 2nd Dept 10-29-14

 

Insufficient Proof Plaintiff Was Defendant’s Special Employee

The Second Department determined the defendant did not demonstrate plaintiff was its special employee.  Therefore summary judgment dismissing plaintiff’s personal injury suit based upon plaintiff’s receiving Workers’ Compensation benefits from his general employer should not have been granted:

“The receipt of Workers’ Compensation benefits from a general employer precludes an employee from commencing a negligence action against a special employer” … . In determining whether a special employment relationship exists, a court should consider factors such as the right to control the employee’s work, the method of payment, the furnishing of equipment, and the right to discharge … . “A significant and weighty factor . . . is who controls and directs the manner, details and ultimate result of the employee’s work'” … .

Contrary to the determination of the Supreme Court, the defendant failed to come forward with sufficient evidence of a special employment relationship to demonstrate its prima facie entitlement to judgment as a matter of law, since its submissions on the motion did not establish, inter alia, that it controlled and directed the manner, details, and ultimate result of the plaintiff’s work … . Nolan v Irwin Contr Inc, 2014 NY Slip Op 07339, 2nd Dept 10-29-14

 

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Criteria for Dismissal of a Complaint Pursuant to CPLR 3211(a)(1) [Defense Based Upon Irrefutable Documentary Evidence] and CPLR 3211(a)(7) [Failure to State a Cause of Action] Explained

In the context of a legal  malpractice action, in affirming the denial of motions to dismiss, the Second Department explained the criteria for motions to dismiss pursuant to CPLR 3211(a)(1) [defense founded on documentary evidence] and CPLR 3211(a)(7) [failure to state a claim]:

A party seeking relief pursuant to CPLR 3211(a)(1) on the ground that his or her defense is founded upon documentary evidence ” has the burden of submitting documentary evidence that resolves all factual issues as a matter of law, and conclusively disposes of the plaintiff’s claim'” … . In the instant matter, the documentary evidence submitted by the defendants, consisting of the orders issued by the Supreme Court in the underlying action, failed to utterly refute the plaintiff’s allegations of malpractice or conclusively establish a defense as a matter of law in the instant action … . * * *

On a motion to dismiss pursuant to CPLR 3211(a)(7), the facts alleged in the complaint must be accepted as true, the plaintiff is accorded the benefit of every possible favorable inference, and the court’s function is to determine only whether the facts as alleged fit within any cognizable legal theory … . “Whether the complaint will later survive a motion for summary judgment, or whether the plaintiff will ultimately be able to prove [his or her] claims, of course, plays no part in the determination of a prediscovery CPLR 3211 motion to dismiss” … . Here, the plaintiff alleged that, but for the defendants’ negligence, including their failure to assert “appropriate claims against the proper parties, . . . the Plaintiff’s medical malpractice claim would have succeeded and resulted in a different, better and/or more positive outcome.” Construing the complaint liberally, accepting the facts alleged in the complaint as true, and according the plaintiff the benefit of every possible inference, as required, the plaintiff stated a cause of action to recover damages for legal malpractice … . Tooma v Grossbarth, 2014 NY Slip Op 07347, 2nd Dept 10-29-14

 

An “Administrative Evaluation,” As Opposed to a Formal Disciplinary Reprimand, Can Remain in a Teacher’s File Even though the Evaluation Was Issued In the Absence of the Formal Notice and Hearing Requirements of Education Law 3020-a

The Second Department determined an “administrative evaluation,” opposed to a formal disciplinary reprimand, could remain in a teacher’s file, even though the evaluation was issued in the absence of the formal notice and hearing procedures mandated by Education Law 3020-a:

In New York, a tenured teacher may not be “disciplined” without being afforded the procedures set forth in Education Law § 3020-a, which requires that formal charges first be referred to the board of education for a determination of probable cause, after which the teacher is given written notice of the charges and an opportunity for a hearing (Education Law § 3020; see Education Law § 3020-a). However, section 3020-a does not “insulat[e] tenured teachers from all written critical comment from their supervisors” … . While a formal disciplinary reprimand may not be issued without compliance with section 3020-a, a critical “administrative evaluation” may properly be included in a teacher’s personnel file without resort to such procedures … .

Here, the letter the petitioner sought to have removed from his personnel file “[fell] within [the] permissible range of administrative evaluation,” and the respondent Elmsford Union Free School District did not act unlawfully in making it part of the petitioner’s personnel file without complying with Education Law § 3020-a… . Matter of Weinberger v Elmsford Union Free School District, 2014 NY Slip Op -7360, 2nd Dept 10-29-14

 

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