New York Civil Procedure

Fourth Department Addresses Conflict of Law Issue

Conflict of law issues can sometimes be confusing, so it's always helpful to review the applicable law.  In a recent  Fourth Department decision, the Court considered the issue of whether New York law or the laws of Ontario applied in Marillo v Benjamin Moore & Co., 2006 NY Slip Op 07007.  In this case, the plaintiff, who lived in New York, was injured while unloading a truck at a manufacturing facility owned by one of the defendants in Ontario, Canada.  Both corporate defendants, one of whom was the parent company of the other, were domiciled in New Jersey.

The conflicting laws related to the cap on the amount of noneconomic damages recoverable by the plaintiff, and thus the parties agreed that the the conflicting laws were loss-allocating rather than substantive.

Thus, as the Fourth Department stated:

(O)ne of the three Neumeier rules applies (Neumeier v Kuehner, 31 NY2d 121, 128; see Cooney v Osgood Mach., 81 NY2d 66, 72; Dorsey v Yantambwe, 276 AD2d 108, 110, lv denied 96 NY2d 712). The determination of which rule applies depends, in the first instance, on the domiciles of the parties (see Cooney, 81 NY2d at 73-74).

The Court determined that pursuant to the third rule set forth in  Neumeier, New York law applied in this case:

Ontario has no interest in the application of its limitation on the recovery of noneconomic damages in an action between nondomiciliaries (see King v Car Rentals, Inc., 29 AD3d 205, 214), but New York has "an important interest in protecting its own residents injured in a foreign [jurisdiction]" by ensuring that they may receive full compensation for their injuries...

4th Dept.--Two Cases of Interest

The Fourth Department recently handed down a number of decisions.  I'll be highlighting a few of the cases over the next few days.  For today, two decisions of interest, one addressing an evidentiary issue and the other a venue issue:

  • Foley v West-herr Ford, Inc., 2006 NY Slip Op 06723--The Fourth Department held that the lower court properly concluded that information collected by the defendants' experts was not discoverable:
    • Supreme Court did not abuse its discretion in denying plaintiffs' motion to compel disclosure of, inter alia, the factual findings, calculations, measurements and diagrams collected by defendants' experts from the accident scene (see generally Nyhlen v Millard Fillmore Hosps., 275 AD2d 943). The information sought is immune from disclosure because it constitutes material prepared in anticipation of litigation, and plaintiffs failed to demonstrate a substantial need for such information and that they were unable to obtain its substantial equivalent without undue hardship (see CPLR 3101 [d] [2]).
  • Eber-ndc, LLC v Star Indus., Inc., 2006 NY Slip Op 06940--The Fourth Department held that the trial court erred when it consolidated actions pending in two counties and changed the venue to its county:
    • Pursuant to CPLR 511 (c) and 2201, once Star moved in the Nassau Court to change venue in the Monroe action, that court had the authority to stay the proceedings in the Monroe action. Despite the Nassau Court's order staying all proceedings in that action, which was then pending in Monroe County, the Monroe Court nevertheless granted Eber's motion to consolidate and, "incidently," changed the venue of the Nassau County action to Monroe County. We conclude that the Monroe Court erred in failing to give effect to the stay ordered by the Nassau Court. Even if the stay were improperly granted, the proper procedure would have been for Eber to move to vacate the stay. (Internal citations omitted.)

REMINDER: On October 1, New York Deposition Rules To Be Amended

I previously posted about the new amendments to the New York Uniform Civil Rules  here.  The new rules go into effect on October 1, 2006.  Here are some important changes to be aware of, as explained in this New York Law Journal article:


  • Attorneys barred from coaching witnesses by making lengthy "speaking objections"
  • Situations in which attorneys may stop a deposition are limited
  • Layers barred from making objections solely on the grounds or relevance, hearsay or competence
  • Before interrupting a deposition an attorney must "clearly and succinctly" state the reason for the interruption

Settlement conferences:

  • Judges are now empowered to order insurance company representatives to participate in settlement conferences
  • Judges may compel participation of others with an interest in the outcome of the litigation, such as lien holders

Ex parte relief:

  • Parties barred from seeking ex parte relief absent significant prejudice
  • Judges barred from granting restraining orders unless a party demonstrates a significant reason why an adversary must be kept in the dark
  • Where a party cannot justify an ex parte order, an new procedure will be adopted that requires lawyers to, at the very least, advise their adversaries of the time and place they will be asking for a restraining order

Rule 202.8:

  • This rule, which was only recently amended in January 2006, as I'd posted about here, will again be amended as set forth in this order.  The new rule provides that the Deputy Chief Administrator for the Courts will send a reminder to the judge if a decision on a pending motion was not decided within 60 days of its submission to the court.  Apparently, allowing lawyers to badger judges about their failure to hand down timely decisions on pending motions wasn't exactly a popular procedure.

New Amendments to the Uniform Civil Rules in New York

According to this New York Law Journal article, the New York Uniform Civil Rules will be amended, effective October 1, 2006, including rule 202.8, which was only just recently amended as I'd posted about previously.  (Hat tip:  New York Attorney Malpractice Blog).  Apparently, allowing lawyers to badger judges about their failure to hand down timely decisions on pending motions wasn't quite working out.

The new amendments will affect a number of areas of practice, including the ways in which depositions are handled, the ways in which pre-trial conferences are managed, and motion practice.  The NYLJ article indicates that some of the new rules are intended to curb lawyer abuses during depositions, in addition to allowing judges to require that representatives of insurance companies participate in settlement conferences.  Another rule change bars an attorney from seeking ex parte relief unless there is a showing of significant prejudice.

From the article, regarding the new rules for depositions:

The deposition standard seeks to bar attorneys from coaching witnesses by making lengthy "speaking objections" in which they suggest an answer to an adversary's question. They also limit situations in which attorneys may stop a deposition and instruct the witness not to answer a question...

Under the rules, lawyers will be barred from making objections solely on the grounds of relevance, hearsay or competence. Lawyers will be permitted to instruct witnesses not to answer when the questions delve into an area of privilege; stray into an area barred by prior court order; or raise a question that "is plainly improper" and would cause "significant prejudice."

To deter the cessation of questioning on what Zauderer called a "frivolous basis," attorneys will be required to instruct witnesses to remain silent to provide "clear and succinct" statements on the record of the reason the instruction is being given.

Attorneys will only be permitted to interrupt a deposition when the questioning veers into one of the prohibited areas. And as is the case when instructing a witness not to answer, a new requirement specifies that, before interrupting a deposition, an attorney will have to "clearly and succinctly" state the reason for intervening.

From the article, regarding the new rules for settlement conferences:

Empowering judges to order insurance company representatives to participate in settlement conferences is an effort to stop insurers from waiting until jury selection is completed before they come forward with their best offer, said Zauderer...

Some insurance companies, he said, have publicly embraced a policy of announcing early in a case "a best and last offer" and sticking with it through trial if the offer is not accepted. But other insurers, even when they voluntarily send a representative to court, will not send someone with authority to offer a high enough figure to settle a case until after the jury is selected, added McDonough, a partner at Cozen O'Connor...

The rules will empower judges to compel the participation of parties and others who have an interest in the outcome of litigation, such as the holders of liens on an award. Judges are given the option of allowing participation over the telephone.

From the article, regarding ex parte relief:

The rule barring a party from seeking ex parte relief absent a showing of "significant prejudice" is designed to bring New York practice in line with that of the federal courts and many other states, said Zauderer. The state's practice of allowing attorneys to routinely request restraining orders without notifying their adversaries has been "rife with abuses," he said.

Under the rule, judges will be barred from granting restraining orders unless a party demonstrates a significant reason why an adversary must be kept in the dark. For instance, Carpinello said that an ex parte order would be justified where a request is being made to restrain funds and there is a likelihood that notice of the application would lead an adversary to secrete the funds before an order could be obtained.

Similarly, an ex parte order would be appropriate where a party is seeking to restrain the demolition of a building and notice would likely lead to the destruction of the building, said Carpinello.

A new procedure will be established for situations where a party cannot justify obtaining an ex parte order. Instead of proceeding ex parte, lawyers will, at a minimum, advise their adversaries of the time and place they will be asking for a restraining order. The rule does not specify how much advance notice will be required but says it must be "sufficient" to allow opposition.

The only rule change that is currently available at the New York Court's web site is the order amending Rule 202.8.

The additional amendments can be found here.

Ouch!--NY Court of Appeals Dismisses Unjust Conviction Claim Against State

In Long v. State of New York, 2006 NY Slip Op 05231, Mr. Long was convicted of Rape, Robbery, and Sexual Abuse in 1995 and sentenced to prison for 8-24 years.  In 2000 he was released and his conviction was vacated pursuant to CPL s. 440.10 as a result of an investigation by the DA's Office which determined that he was the "wrong man."  In 2002 he failed a claim against the State of New York in the Court of Claims alleging unjust conviction and imprisonment. 

The Court first clarified that "the Court of Claims Act requires a claimant to establish only that the vacatur of the judgment was predicated upon one of the statutory grounds" rather than requiring a claimant to establish that the vacatur of the judgment and dismissal of the indictment were based on one of the grounds specified in Court of Claims Act § 8-b (3) (b) (ii) and CPL 440.10 (1).

However, unfortunately for Mr. Long, the next issue considered by the Court was not decided in his favor, and is yet another example of a failure to err on the side of caution when it comes to procedural matters--especially when filing a claim in the Court of Claims.

In this case, the claim was not verified by Mr. Long, but rather was verified by his attorney on his behalf, pursuant to pursuant to CPLR 3020 (d) (3), which permits an attorney to verify a claim if the client "is not in the county where the attorney has his office."  The Court concluded that, unlike other types of claims against the State, the Court of Claims Act specifically required a Claim verified only by the claimant in cases alleging unjust conviction and imprisonment:

Claimant's reliance on Lepkowski is misplaced. That case involved section 11 (b) of the Court of Claims Act, the general verification requirement that specifically incorporates CPLR procedures by providing that a claim "be verified in the same manner as a complaint in an action in the supreme court." We concluded that a defectively verified claim under section 11 (b) should be treated no differently than a defective verification in supreme court, and that CPLR 3022's remedy for an invalid verification is available (see Lepkowski, 1 NY3d at 210). In contrast, the verification requirement in Court of Claims Act § 8-b (4) is specific to claims for unjust conviction and imprisonment and makes no reference to the rules governing supreme court practice. Hence, CPLR 3020 (d) (3) and 3022 have no application to this case.

Wow.  That's gotta hurt.  Talk about unjust results.  Poor Mr. Long.  At least he only served 5 years in prison prior to the vacatur of his sentence, as opposed to the unlucky people who aren't released for 15-20 years.  But, I suppose that's not much consolation, now, is it?

Do E-mails Sent to NY Businesses Constitute "Conducting Business" for Jurisdictional Purposes?

In Deutsche Bank Sec., Inc. v Montana Bd. of Invs., 2006 NY Slip Op 04338, the New York Court of Appeals considered the issue of whether long-arm jurisdiction applied to a commercial entity's use of e-mail and instant messages to communicate with businesses located in New York.

The litigation in this case arose from what was essentially a breach of contract action between a bank based in Manhattan and a Montana state agency.  A number of instant messages (sent through the Bloomberg Instant Messaging System), were exchanged over a 2 day period relating to a possible large scale bond trade which ultimately fell through.

In determining whether long-arm jurisdiction applied to the transactions, the Court first set forth the appropriate standard for long-arm jurisdiction in New York:

New York's long-arm statute provides that "a court may exercise personal jurisdiction over any non-domiciliary . . . who in person or through an agent . . . transacts any business within the state or contracts anywhere to supply goods or services in the state" (CPLR 302 [a] [1]). By this "'single act statute' . . . proof of one transaction in New York is sufficient to invoke jurisdiction, even though the defendant never enters New York, so long as the defendant's activities here were purposeful and there is a substantial relationship between the transaction and the claim asserted" (Kreutter v McFadden Oil Corp., 71 NY2d 460, 467 [1988])...

"(S)o long as a party avails itself of the benefits of the forum, has sufficient minimum contacts with it, and should reasonably expect to defend its actions there, due process is not offended if that party is subjected to jurisdiction even if not 'present' in that State" (id. at 466).

The Court noted that its past decisions had extended long-arm jurisdiction to commercial actors using electronic and telephonic means to project themselves into New York in order to conduct business transactions.  The Court extended this line of reasoning and, in a unanimous decision, concluded that:

As distinct from an out-of-state individual investor making a telephone call to a stockbroker in New York ), MBOI is a sophisticated institutional trader that entered New York to transact business here by knowingly initiating and pursuing a negotiation with a DBSI employee in New York that culminated in the sale of $15 million in bonds.

In short, when the requirements of due process are met, as they are here, a sophisticated institutional trader knowingly entering our state — whether electronically or otherwise — to negotiate and conclude a substantial transaction is within the embrace of the New York long-arm statute. (Internal quotations and citations omitted).

The Court also rejected the argument that a Montana statute that purported to vest exclusive jurisdiction with Montana courts applied:

We continue to hold that where, as here, a lawsuit arises from a commercial transaction in which another state, or its agent, has knowingly projected itself into New York to take advantage of our financial markets, New York courts should not dismiss the action as a matter of comity.

This case and its underlying facts are discussed in more detail in this article from the New York Law Journal and in this Newsday article.

Fourth Department Addresses Statute of Limitations Issue

The Court of Appeals handed down another set of decisions yesterday, and I plan to address a number of the decisions in the coming weeks.  I still have a few leftover cases from the last round of decisions that I haven't gotten to yet, as well.  However, there is always a dry spell in the summer, so I'll have plenty of time to cover the Court of Appeal's decisions, as well as decisions from all four Appellate Divisions in the upcoming months.

In the meantime, the Fourth Department recently considered an interesting issue in Schoemann v Adams, 2006 NY Slip Op 03345.  In this case, the plaintiff commenced an action seeking to recover for personal injuries by filing a summons with notice.  An affidavit of service upon the defendant was never filed and the defendants never appeared in the action, so it was deemed dismissed after 120 days had passed. 

Pursuant to CPLR s. 306-b(b), the plaintiff had 120 days after the dismissal to commence a new action, even though the statute of limitations had expired between the time that the action was initially commenced and then dismissed. 

During the second 120 day period, the plaintiff filed a complaint and second summons with the County Clerk's office, and was re-issued the same index number that had been issued in the first action.

The defense made a motion to dismiss the second action on the grounds that it had not been commenced within the three year statute of limitations since the plaintiff had failed to "to purchase a new index number and file new initiatory papers under a new index number prior to the expiration of the statute of limitations ... or within 120 days after the [first action was deemed dismissed]."

The Court concluded that the re-issuance of the same index number by the County Clerk's office did not invalidate the commencement of the action.  The Court stated that:

Plaintiff established that he paid the requisite filing fee and secured "an index number" for the new action. Defendants failed to preserve for our review their present contention that the receipt submitted by plaintiff to prove that he paid the second filing fee constitutes inadmissible hearsay. We thus conclude that, although the index number given to plaintiff by the County Clerk's office was not a "new" index number, plaintiff complied with the "absolute necessity of purchasing an index number to commence [the] action".  (Internal citations omitted)

This is a prime example of why, in my opinion, an action should never be commenced by the filing of a summons with notice--especially when the statute of limitations is about to run.  Too many things can go wrong and some things are entirely out of your control, such as the situation that occurred in this case.  And if that happens, then you're quite possibly out of luck and so is your client.

Professor David Siegal hammered that point home in my New York Practice class in law school, and I've never forgotten it.  As he always used to stress--play it safe in your cases and let the appellate courts decide the law in SEC (someone else's case).

The plaintiff got lucky in this case.  Why risk it?  File a summons and complaint and forego the summons with notice and all the potential pitfalls inherent in that method of commencing a case.

Notice of Claim Pitfalls

A recent Third Department case, Forrest v Berlin Cent. School Dist., 2006 NY Slip Op 04124, is a great example of the dangers of proceeding pro se and the pitfalls that can be encountered when faced with the very specific Notice of Claim requirements set forth in General Municipal Law s. 50-e.

In Forrest, the pro se plaintiff alleged that he'd been defamed by employees of the defendant on October 9, 2002.  He incorrectly filed a Notice of Claim regarding the incident by filing it with the County Clerk in February of 2003, and based upon an alleged misunderstanding of the law, did not serve it upon the defendant until  October 8, 2003, nearly one year after the accrual of the cause of action.

The plaintiff subsequently moved for leave to file a late notice of claim and for leave to file a summons and amended complaint, and the trial court denied his motion.

The Third Department set forth the factors to be considered in determining whether the trial court's decision was an abuse of discretion:

The determination of such a motion is discretionary and involves consideration of several factors including, as relevant here, whether defendant acquired actual knowledge of the facts essential to the claim within 90 days after its accrual, any reasonable excuse offered for delay in filing and prejudice to defendant due to the late notice.

The Court noted that the plaintiff's alleged ignorance of the law was no excuse and that the plaintiff had failed to offer an acceptable reason for the delay.  Accordingly, the Court concluded that the trial court did not abuse its discretion when it denied the motion and that the defendant had suffered prejudice as a result of the delay:

Although defendant was aware that its employees made a report that plaintiff potentially neglected his child, and that plaintiff disagreed with that report, defendant was not aware of the facts alleged by plaintiff to support his claim, namely that this report was false and made with malice, thereby defaming plaintiff and causing him emotional injuries. Without such awareness, defendant had no reason to conduct an investigation.  (Internal citations omitted).

In a final twist of the knife, the Court noted that, in any event, the claim itself was "patently meritless" and that permitting him to serve a late notice of claim would have been "an exercise in futility."

Ouch.  It was a bad day for Mr. Forrest--a bad day, indeed.

Practice Tips for Fourth Department Practitioners

I attended a CLE yesterday at which the presiding justice of the Appellate Division Fourth Department, Hon. Eugene Pigott, spoke and I learned a few things that might be of interest to Rochester and Fourth Department practitioners.

First, the Fourth Department will be instituting a Civil Appeals Settlement Program as of May 1, 2006.  The new  Rule 1010.1 et. seq. can be found here.

As explained in the Notice to the Bar:

The purpose of CASP is to identify appeals that may be amenable to settlement or to a limitation of issues to be presented on appeal. For each appeal covered by CASP, the appellant will be required to file a precalendarstatement at the time that the notice of appeal is filed. The failure to file a precalendar statement may result in the dismissal of an appeal.

Selected appeals will be subject to precalendar conferences before Judicial Hearing Officers selected by the Court. In addition, CASP includes a mechanism whereby a party to a particular appeal may request a precalendar conference.

Additionally, the following may be of interest to those who practice in Rochester, NY.  The presiding Justice of the Commercial Division in Monroe County, Hon. Kenneth R. Fisher, has signed a General and Standing Order regarding the new Commercial Division Rules that I'd previously posted about here.   His Order modifies Rule 17, Rule 19, Rule 19-a and Rule 22 of the new Commercial Division Rules by making them inapplicable in the 7th Judicial District.

Court of Appeals Addresses Requirement That a Separate Index Number Be Purchased for Each Proceeding

In Harris v. Niagara Fall Board of Educ., 2006 NY Slip Op 01113, the Court of Appeals considered the issue of whether the Complaint was time barred pursuant to CPLR 3211 due to the plaintiff's use of an index number from a prior special proceeding. 

In this case, the plaintiff was injured in an automobile accident and failed to serve a notice of claim within 90 days of the accident.  Accordingly, he commenced a special proceeding seeking to serve a late notice of claim and purchased an index number in the process.  Shortly thereafter, the plaintiff retained different counsel, who commenced a second special proceeding using the original index number and again sought leave to serve a late notice of claim .  The Court granted the request, the plaintiff then served a late notice of claim and subsequently commenced a personal injury action against the defendants using the same index number that was used in both prior special proceedings.

The Court stated that:

Under the procedure mandated by the CPLR, "service of process without first paying the filing fee and filing the initiatory papers is a nullity, the action or proceeding never having been properly commenced"

Accordingly, the Court concluded that the claim should be dismissed as time-barred since the plaintiff failed  to purchase a new index number and instead used the index number from the prior special proceedings, thus failing to comply with the commencement-by-filing system.

The New York Civil Law blog also posted about this case here.