JUST RELEASED

December Page III

Summaries of Recently Released Decisions to Be Included In the Next Issue of the Digest (uncorrected)

 

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COURT OF APPEALS

 

ADMINISTRATIVE LAW/ANIMAL LAW

 

Rule Allowing Testing of Horses for Speed-Enhancing Drugs at Times Other than Just Before a Race Is a Valid Exercise of Racing & Wagering Board's Authority

 

The Court of Appeals, in a full-fledged opinion by Judge Lippman, determined that the NYS Racing & Wagering Board did not exceed its authority when it promulgated rules allowing testing horses for the presence of speed-enhancing drugs at times other than immediately preceding a race:

 

While it is true that an administrative agency within the executive branch may not under the guise of rule-making engage in basic policy determinations reserved to the Legislature ..., it is also true that the Legislature "has considerable latitude in determining the reasonable and practicable point of generality in adopting a standard for administrative action and, thus, [that] a reasonable amount of discretion may be delegated to . . . administrative officials" ... . Here, the Legislature, in drafting Racing Law § 301 (2), was at pains to be explicit that that subsection was not to be construed as a limitation upon respondent's powers "to supervise generally all harness race meetings in this state at which pari-mutuel betting is conducted" and in that connection to "adopt rules and regulations . . . to carry into effect its [respondent's] purposes and provisions and to prevent circumvention or evasion thereof" (Racing Law § 301 [1]). Thus, not only does section 301 when read in its entirety make plain that the Legislature had no purpose of restricting respondent's general supervisory power over pari-mutuel harness race meetings, but it specifically authorizes regulatory action to prevent the circumvention or evasion of existing rules, necessarily including those whose object, sensibly understood, is "effectually" to prevent horses from racing under the influence of speed-enhancing doping agents. Out-of-competition drug testing, which, as noted, has as its raison d'etre the plugging of a loophole created in the pre-existing regulatory regimen by the introduction of doping agents capable of affecting competitive performance while eluding race day detection, is precisely the sort of measure contemplated by section 301 (1). As for section 902 (1), it too has no apparent limiting purpose — its designation of a laboratory to perform equine drug testing at race meetings does not reasonably signify that such testing may be required by respondent only at race meetings. Matter of Ford v NYS Racing & Wagering Board, 2014 NY Slip Op 08870, CtApp 12-18-14

 

 

CRIMINAL LAW/EVIDENCE

 

Even Though Probable Cause for a DWI Arrest Existed, the Arresting Officer Testified He Was Not Going to Arrest the Defendant Until He Found a Switchblade Knife During a Pat-Down Search---Therefore the Search Could Not Be Justified As a Search Incident to Arrest and the Switchblade Should Have Been Suppressed

 

The Court of Appeals, in a full-fledged opinion by Judge Smith, over a dissent, determined that a switch-blade found in a pat-down search of the defendant after a vehicle stop should have been suppressed. The way the defendant was driving and the officer's observations of defendant after the stop provided probable cause for a DWI arrest.  However, at the suppression hearing, the arresting officer (Merino) testified that he was not going to arrest the defendant prior to the pat-down search and only arrested him because the knife was found.  The Court of Appeals held that the search, therefore, could not be a "search incident to arrest" and could not be otherwise justified:

 

It is not disputed that, before conducting the search, Merino could lawfully have arrested defendant for driving while intoxicated. And it is clear that the search was not unlawful solely because it preceded the arrest, since the two events were substantially contemporaneous (see Rawlings v Kentucky, 448 US 98, 111 [1980] ["Where the formal arrest followed quickly on the heels of the challenged search . . ., we do not believe it particularly important that the search preceded the arrest rather than vice versa"]; People Evans, 43 NY2d 160, 166 [1977] ["The fact that the search precedes the formal arrest is irrelevant as long as the search and arrest are nearly simultaneous so as to constitute one event"]). Nor is it decisive that the police chose to predicate the arrest on the possession of a weapon, rather than on driving while intoxicated (see Devenpeck v Alford, 543 US 146 [2004]). The problem is that, as Merino testified, but for the search there would have been no arrest at all.

 

Where that is true, to say that the search was incident to the arrest does not make sense. It is irrelevant that, because probable cause existed, there could have been an arrest without a search. A search must be incident to an actual arrest, not just to probable cause that might have led to an arrest, but did not ... . People v Reid, 2014 NY Slip Op 08759, CtApp 12-16-14

 

 

CRIMINAL LAW/APPEALS

 

Overruling Long-Standing Precedent, The Court of Appeals Determined It Has the Power to Review the Summary Denial of a 440 Motion for Abuse of Discretion/The Trial Court Abused Its Discretion in this Case/The Matter Was Sent Back for a Hearing

 

The Court of Appeals, in a full-fledged opinion by Judge Pigott, overruling long-standing precedent, held that the Court of Appeals has the power to review the summary denial of a motion to vacate a conviction based upon newly discovered evidence [Criminal Procedure Law (CPL) 440.10(1)(g)]. The defendant had already completed his sentence for rape when he had trial evidence---hairs and fingernail scrapings---subjected to DNA analysis.  The DNA results excluded the defendant.  The trial court summarily denied the motion to vacate and the Appellate Division affirmed.  The Court of Appeals reversed and sent the matter back for a hearing:

 

...[T]his Court is empowered to conduct a review of the lower courts' summary denial of a defendant's CPL 440.10 (1) (g) motion, and to determine whether that denial constituted an abuse of discretion as a matter of law without running afoul of the jurisdictional limitations set forth in NY Constitution, article VI, § 3 (a). Although we are prohibited from weighing facts and evidence in noncapital cases, we are not precluded from exercising our "power to determine whether in a particular judgmental and factual setting there has been an abuse of discretion as a matter of law" because, in so doing, we are not "passing on facts as such, but rather considering them to the extent that they are a foundation for the application of law" ... . * * *

 

On this record, there is a dispute between defendant and the People concerning the reliability of the mtDNA testing, what the results of such testing actually mean and the weight to be given those results in light of the eyewitness identification. As such, defendant should have been afforded a hearing so he could have at the very least an opportunity of "proving by a preponderance of the evidence every fact essential to support [his] motion" (CPL 440.30 [6]), including his assertion that had such DNA evidence been presented at trial, he would have received a more favorable verdict. We reach this conclusion not by weighing the facts or the inferences drawn therefrom, but by examining the parties' submissions and concluding that the People failed to counter defendant's prima facie showing that he was entitled to a hearing. Not every CPL 440.10 motion brought by a defendant will warrant a hearing, nor will every summary denial of such a motion constitute an abuse of discretion, but where, as here, there is significant DNA evidence favorable to the defendant and the People proffer no admissible evidence in opposition to that evidence, defendant is, at the very least, entitled to a hearing on his motion. People v Jones, 2014 NY Slip Op 08760, CtApp 12-16-14

 

 

CRIMINAL LAW

 

CPL 330.30 Motions Based Upon Matters Outside the Record Properly Denied/Although Not the Case Here, Such Motions Might Be Deemed Premature CPL 440.10 Motions and, As Such, Considered by the Trial Court/Concurring/Dissenting Opinions Disagreed About Whether the Persistent Felony Offender Statute, Which Allows the Judge to Exercise Discretion in Applying the Statute, Violates Apprendi v New Jersey (Requiring Facts Upon Which an Enhanced Sentence May Be Based to Be Decided by the Jury Under a Beyond a Reasonable Doubt Standard)

 

The Court of Appeals, in a brief memorandum decision, determined that motions to set aside the verdict (Criminal Procedure Law [CPL] 330.30) made in two the cases before the court were properly denied because they raised issues which were outside the record. The court further determined that the persistent felony offender statute (PFO) at issue in one of the cases was properly applied. The court noted that, in some situations, 330.30 motions might be deemed (premature) motions to vacate the conviction (CPL 440.10) and considered by the trial court in that context, but no attempt to invoke CPL 440.10 was made here.  Concurring and dissenting opinions dealt with whether the persistent felony offender statute (PFO) violated Apprendi v New Jersey, 530 US 466 (2000), because factual findings supporting an enhanced sentence are made by the judge, not the jury, and whether the motion to set aside the verdict on the ground that the courtroom was closed to the public for part of the trial should have been considered as a (premature) CPL 440.10 motion to set aside the conviction. People v Giles, 2014 NY Slip Op 08871, CtApp 12-18-14

 

 

CRIMINAL LAW/MUNICIPAL LAW/CONSTITUTIONAL LAW

 

Code Provision Prohibiting the Placement of Signs on Public Property Is a Constitutional, Content-Neutral Restriction of Speech Which Was Severable from the Rest of the Code Chapter---There Was, Therefore, No Need to Assess the Constitutionality of the Entire Chapter (As the Appellate Division Had)

 

Reversing the Appellate Division, the Court of Appeals determined that section 57A-11 of the Town Code, which prohibited the placement of signs on public property, could be severed from the rest of chapter and was a valid, content-neutral regulation of speech.  The Appellate Division had held that section 57A-11, which was valid standing on its own, could not be severed from the rest of the chapter and that the chapter as a whole was unconstitutional because it favored commercial over noncommercial speech. The defendant here had pled guilty to violating section 57A-11:

 

"In a statutory context, our test for severability has been whether the Legislature would have wished the statute to be enforced with the invalid part exscinded, or rejected altogether" ... . In Superfund Coalition, for example, the unconstitutional portion was at the "core" of the statute, and "interwoven inextricably through the entire regulatory scheme" (id.). By contrast, section 57A-11 deals only with signs posted on public property, a discrete regulatory topic and regime. This is reinforced by section 57A-11 (A), which explains the provision's purpose and focuses entirely on the unique problems posed by signs on public right-of-ways. In light of section 57A-11's independent legislative purpose, this provision can be severed from any unconstitutional portions of chapter 57A. We therefore need not and do not consider the constitutionality of any part of chapter 57A except section 57A-11. * * *

 

Section 57A-11 of the Town Code * * * imposes a content- neutral ban on all signs on public property, and applies to both commercial and non-commercial signs without consideration of their content. Further, it directly serves the Town's valid interests in traffic safety and aesthetics, as expressly articulated in section 57A-11 (A). People v On Sight Mobile Opticians, 2014 NY Slip Op 08761, CtApp 12-16-14

 

 

 

CRIMINAL LAW/ATTORNEYS

 

Where Defendant Is Represented on a Pending Charge and Seeks Leniency by Cooperation with Police in the Investigation of An Unrelated Offense, the Police Cannot Question the Defendant About the Unrelated Offense in the Absence of Counsel Unless Defendant Affirmatively Waives His Right to Counsel In Counsel's Presence

 

The Court of Appeals, in a full-fledged opinion by Judge Smith, over a dissent, determined that defendant, who was represented by counsel in a pending criminal matter, should not have been questioned in the absence of counsel about another crime.  Defendant, in an attempt to gain leniency, told the police he knew that a friend had committed a stabbing. The police met with the defendant to "wire him up" for a meeting with his friend.  Defendant's attorney, Schwarz, knew defendant was meeting with the police for that purpose.  During the meeting, the defendant was questioned about the stabbing and eventually he admitted he had committed that crime.  He was then read his Miranda rights, which he waived.  The Court of Appeals held that none of the questioning about defendant's involvement with the stabbing should have be done without defendant's affirmative waiver of his right to counsel, in the presence of defendant's attorney:

 

Defendant relies on the rule, long established in New York, that "[o]nce an attorney enters the proceeding, the police may not question the defendant in the absence of counsel unless there is an affirmative waiver, in the presence of the attorney, of the defendant's right to counsel" ... . The People respond that this rule does not apply here because the "proceeding" in which the police questioned defendant on ...---their investigation of the supermarket stabbing —---was one that no attorney had entered. Schwarz, in the People's view, represented defendant only in the burglary case, about which he was not questioned.

 

We do not find this a viable distinction. The stabbing investigation cannot be neatly separated from Schwarz's representation of defendant in the burglary case. Defendant had pinned his hopes for a favorable result in the burglary case on his cooperation with the police investigation of the stabbing. Under these circumstances, Schwarz's duty to his client required him to concern himself with both cases.

 

Schwarz was not, of course, retained to defend the stabbing case: before the April 19 meeting, defendant had not been charged with the stabbing, and no such charge seemed likely. But Schwarz's obligation in defending the burglary case included an obligation to be alert to, and to avert if he could, the possibility that defendant's cooperation would hurt rather than help him. No responsible lawyer in Schwarz's situation would concern himself with the burglary case alone, indifferent to the disaster that might strike defendant if he incriminated himself in the stabbing.

 

We therefore conclude that defendant's right to counsel encompassed his conversations with police about the stabbing, as long as those conversations were part of an effort to obtain leniency in the burglary case in which Schwarz represented him. Thus, unless the right to counsel was waived, the police should not have questioned defendant about the stabbing in his lawyer's absence. People v Johnson, 2014 NY Slip Op 08787, CtApp 12-17-14

 

 

LANDLORD-TENANT/CONTRACT LAW

 

Although the Landlord Can Sue Pursuant to the Accelerated Rent Clause and Is Not Under a Duty to Mitigate, the Out-of-Possession Tenant Should Be Afforded a Hearing On Whether the Accelerated Rent/Liquidated Damages Clause, Under the Facts, Constitutes an Unenforceable Penalty Because It Results In Recovery Grossly Disproportionate to the Landlord's Actual Damages

 

The Court of Appeals, in a full-fledged opinion by Judge Rivera, determined that, where the tenant has breached the lease and left the premises, the landlord can sue to enforce the rent acceleration clause and is under no duty to mitigate.  However, under the facts here, the tenant was entitled to a hearing to address whether the acceleration clause allows liquidated damages which are grossly disproportionate to the actual losses, and therefore constitutes an unenforceable penalty:

 

As a general matter parties are free to agree to a liquidated damages clause "provided that the clause is neither unconscionable nor contrary to public policy" ... . Liquidated damages that constitute a penalty, however, violate public policy, and are unenforceable ... . A provision which requires damages "grossly disproportionate to the amount of actual damages provides for a penalty and is unenforceable" ... .

 

Whether a provision in an agreement is "an enforceable liquidation of damages or an unenforceable penalty is a question of law, giving due consideration to the nature of the contract and the circumstances" ... . "The burden is on the party seeking to avoid liquidated damages[] to show that the stated liquidated damages are, in fact a penalty" ... . Where a party establishes a penalty, the proper recovery is the amount of actual damages established by the party ... .

 

Defendants claim that because the acceleration clause permits [the landlord] to hold possession and immediately collect all rent due, the damages are grossly disproportionate to the landowner's actual damages. They contend this is a windfall that allows [the landlord] to double dip—--get the full rent now and hold the property. On its face this argument is compelling because arguably the ability to obtain all future rent due in one lump sum, undiscounted to present-day value, and also enjoy uninterrupted possession of the property provides the landowner with more than the compensation attendant to the losses flowing from the breach—--even though such compensation is the recognized purpose of a liquidated damages provision ... . 172 Van Duzer Realty Corp v Globe Alumni Student Assistance Assn Inc, 2014 NY Slip Op 08872, CtApp 12-18-14

 

 

LIEN LAW

 

In the Absence of Prejudice, a Notice of Lien May Be Amended to Correct a Misdescription of the True Property Owner

 

The Court of Appeals, in a full-fledged opinion by Judge Lippman, determined, in the absence of prejudice, a notice of mechanic's lien can be amended nunc pro tunc to reflect the true owner of the property:

 

Here, the true owner is the sole shareholder of the listed owner, the conveyance of the property in question from the listed owner to the true owner was not at arm's length, and the public and certainly the true owner here were on notice that a lien had been placed on the property. The subject notice of lien also provided means for third parties to contact the true owner. And, significantly, the true owner and listed owner consented to the underlying work that allegedly went uncompensated. Under the particular circumstances presented, the misnomer is a misdescription that does not constitute a jurisdictional defect and is curable by amendment. * * *

 

Article 2 of the Lien Law provides that it "is to be construed liberally to secure the beneficial interests and purposes thereof" (Lien Law § 23), which include "provid[ing] security for laborers and materialmen and . . . provid[ing] notice and a degree of certainty to subsequent purchasers" ... . It states that "substantial compliance . . . shall be sufficient for the validity of a lien and to give jurisdiction to the courts to enforce the same" (Lien Law § 23) and "[a] failure to state the name of the true owner . . . or a misdescription of the true owner, shall not affect the validity of the lien" (Lien Law § 9 [7]). The Lien Law also authorizes amendment provided it does not "prejudice . . . an existing lienor, mortgagee or purchaser in good faith" (Lien Law § 12-a [2]). Thus, read together, it explicitly provides that it should be construed liberally, states that a misdescription of the true owner shall not invalidate a lien, and allows amendment where a third party would not be prejudiced. Matter of Rigano v Vibar Constr Inc, 2014 NY Slip Op 08762, CtApp 12-16-14

 

 

 

MENTAL HYGIENE LAW/CRIMINAL LAW

 

Sex Offender Who Has Difficulty Controlling Sexual Urges, As Opposed to a Sex Offender Who Is Unable to Control Sexual Urges, Should Be Placed Under Strict and Intensive Supervision, Not Confined

 

The Court of Appeals, in a full-fledged opinion by Judge Pigott, determined that respondent sex offender should not be confined in a mental health facility after serving his prison sentence, but rather should be placed under "strict and intensive supervision."  After finding the "least restrictive alternative doctrine" does not apply to Article 10 (Mental Hygiene Law) proceedings, the Court of Appeals determined the evidence did not support the conclusion respondent was a "dangerous sex offender requiring confinement."  The evidence demonstrated respondent had, with difficultly, been able to control his sexual urges, but did not demonstrate that he was unable to control them (the requirement for confinement):

 

The Mental Hygiene Law defines "mental abnormality" as "a congenital or acquired condition, disease or disorder that affects the emotional, cognitive, or volitional capacity of a person in a manner that predisposes him or her to the commission of conduct constituting a sex offense and that results in that person having serious difficulty in controlling such conduct" (MHL § 10.03 [i] [emphasis added]). By contrast, a "dangerous sex offender requiring confinement" is defined in the Mental Hygiene Law as "a person who is a detained sex offender suffering from a mental abnormality involving such a strong predisposition to commit sex offenses, and such an inability to control behavior, that the person is likely to be a danger to others and to commit sex offenses if not confined to a secure treatment facility" (MHL § 10.03 [e] [emphasis added]). The statute — which goes on to describe a "sex offender requiring strict and intensive supervision" as a "detained sex offender who suffers from a mental abnormality but is not a dangerous sex offender requiring confinement" (MHL § 10.03 [r]) — clearly envisages a distinction between sex offenders who have difficulty controlling their sexual conduct and those who are unable to control it. The former are to be supervised and treated as "outpatients" and only the latter may be confined. Matter of State of New York v Michael M, 2014 NY Slip Op 08789, CtApp 12-17-14

 

 

MUNICIPAL LAW/LABOR LAW

 

Violation of Labor Law Can Serve as a Basis for a Damages Action by a Police Officer Against the City Re: Injuries Suffered on the Job

 

The Court of Appeals, in a full-fledged opinion by Judge Rivera, over a dissent, determined that a violation of Labor Law 27-a can serve as the basis of a damages action by a police officer injured while on the job.  Plaintiff officer was injured when she fell off a truck while loading wooden barricades:

 

With [the] understanding of the legislative intent to give broad application to GML § 205-e, we turn to defendants' challenge to plaintiff's cause of action for damages. To succeed on their summary judgment motion, defendants must establish "a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact" ... . For the reasons we discuss, defendants have failed to meet their burden.

 

In order to assert a claim under GML § 205-e, a plaintiff "must [1] identify the statute or ordinance with which the defendant failed to comply, [2] describe the manner in which the [police officer] was injured, and [3] set forth those facts from which it may be inferred that the defendant's negligence directly or indirectly caused the harm" ... . Defendants allege plaintiff cannot satisfy the first requirement because the Labor Law may not serve as a basis for her cause of action. We disagree.

 

As a predicate to her GML damages cause of action plaintiff relies specifically on Labor Law § 27-a (3) (a) (1), which provides that "[e]very employer shall: (1) furnish to each of its employees, employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to its employees and which will provide reasonable and adequate protection to the lives, safety or health of its employees."

 

Defendants counter that because [Labor Law 27-a] lacks a private right of action plaintiff cannot base her GML § 205-e claim on section 27-a. However, that is exactly what GML § 205-e permits and what the Legislature intended. While it is true that [the Labor Law]  does not contain an express private right of action ..., GML § 205-e does not require that the predicate for a police officer's action contain an existing right to sue. Gammons v City of New York, 2014 NY Slip Op 08869, CtApp 12-18-14

 

 

REAL PROPERTY LAW/REAL ESTATE/TAX LAW/COOPERATIVES/CORPORATION LAW/MUNICIPAL LAW

 

Privatization of a Mitchell-Lama Cooperative Housing Corporation Is Not a Taxable Conveyance Subject to the Real Property Transfer Tax

 

The Court of Appeals, in a full-fledged opinion by Judge Abdus-Salaam, determined that the reconstitution of a cooperative housing corporation [Trump Village], changing from a Mitchell-Lama corporation pursuant to the Private Housing Finance Law [PHFL] to a corporation pursuant to the Business Corporation Law, was not a conveyance of real property subject to the Real Property Transfer Tax [RPTT]. The NYC Department of Finance characterized the change as a taxable conveyance and was seeking over $21,000,000 in tax and penalties.  The Court of Appeals held that the amendment to the certificate of incorporation did not create a new corporation and that the amended certificate did not constitute a deed:

 

In support of their position that the privatization of Trump Village is a taxable event, defendants argue that an amendment to a certificate of incorporation is a "deed." Defendants also assert that Trump Village is a new corporation and that there was actually a conveyance of real property to a different corporation, with Trump Village being both the grantor and grantee. However, defendants' construction of the RPTT cannot be reconciled with the plain language of the statute. Furthermore, even if there were any ambiguities regarding the application of the RPTT to this situation, "doubts concerning [a taxing statute's] scope and application are to be resolved in favor of the taxpayer"... . Thus, we reject defendants' strained interpretation of section 11-2102(a) of the Administrative Code of the City of New York. ...

 

Trump Village ..., is the same corporation that was named in the original certificate of incorporation. The Business Corporation Law distinguishes between amending a certificate of incorporation (§ 801 et seq.) and formation of a corporation (§ 401 et seq.). Section 801 (14) provides that a certificate of incorporation may be amended "to strike out, change or add any provision . . . relating to the business of the corporation, its affairs, its right or powers . . . ."...

 

The PHFL provides that a Mitchell-Lama corporation "may be voluntarily dissolved" and "[t]hat upon dissolution, title to the project may be conveyed in fee to the owner or owners of its capital stock or to any corporation designated by it or them for that purpose, or the company may be reconstituted pursuant to appropriate laws relating to the formation and conduct of corporations"(PHFL § 35 [3][emphasis added]). Accordingly, there are two options for the process of privatization, and plaintiff chose the second option - - reconstitution through amendment of its certificate of incorporation [FN1]. Defendants posit that the legislature intended the word "reconstitute" to mean the same thing as "reincorporate." However, as long ago as 1857, it was recognized that reincorporation "cannot be deemed the formation of a new corporation, but should be regarded as the continuation of the existing one"... . Trump Vil Section 3 v City of New York, 2014 NY Slip Op 08788, CtApp 12-17-14

 

APPELLATE DIVISION

 

CIVIL PROCEDURE

 

Motion for a Change of Venue Made in the Wrong County--Statutory Procedure Explained

 

The Second Department determined that, given plaintiff's response to the demand to change venue, defendants' motion for a change of venue should have been made in the county where action was pending.  The court explained the applicable law:

 

"CPLR 511(b) provides a mechanism pursuant to which a defendant may serve a demand to change the place of a trial upon the ground of improper venue to a county the defendant specifies as being proper" ... . If the plaintiff does not consent to the change, "the defendant may move to change the place of trial within fifteen days after service of the demand" (CPLR 511[b]). The defendant may notice such motion to be heard as if the action were pending in the county he or she specified, unless the plaintiff, within five days after service of the demand, serves an affidavit showing either that the county specified by the defendant is not proper or that the county designated by the plaintiff is proper (see id.).

 

Here, in response to the defendants' demand to change venue, the plaintiff timely served an affidavit of her attorney containing factual averments that were prima facie sufficient to show that the county designated by her was proper (see CPLR 503[a]; 511[b]...). Accordingly, the defendants' motion pursuant to CPLR 510(1) should have been made in the Supreme Court, Kings County, where the action was pending, and the Supreme Court, Nassau County, erred in granting the motion ... .  King v CSC Holdings LLC, 2014 NY Slip OP 08813, 2nd Dept 12-17-14

 

 

 

CIVIL PROCEDURE/DEBTOR-CREDITOR

 

Criteria for Accelerated Relief Re: a Promissory Note Explained--Conclusory Allegations of Fraud in the Inducement Insufficient to Defeat Summary Judgment

 

Reversing Supreme Court, the Second Department determined plaintiff was entitled to accelerated summary judgment on a promissory note because the defendant's conclusory allegations of fraud in the inducement were not sufficient to defeat the motion.  The court explained the availability of accelerated relief:

 

"Pursuant to CPLR 3213, a party may obtain accelerated relief by moving for summary judgment in lieu of complaint, provided that the action is based upon an instrument for the payment of money only or upon any judgment'" ... . " A promissory note is an instrument for the payment of money only, provided that it contains an unconditional promise by the borrower to pay the lender over a stated period of time'" ... . "An instrument does not qualify for accelerated relief under CPLR 3213 if outside proof is needed, other than simple proof of nonpayment or a similar de minimis deviation from the face of the document'" ... . "Therefore, a plaintiff makes a prima facie showing of entitlement to judgment as a matter of law pursuant to CPLR 3213 by showing that the defendant executed the subject instrument, the instrument contains an unconditional promise to repay the plaintiff upon demand or at a definite time, and the defendant failed to pay in accordance with the instrument's terms" ... . Once the plaintiff establishes its prima facie entitlement to judgment as a matter of law, the burden shifts to the defendant to submit admissible evidence to establish the existence of a triable issue of fact with respect to a bona fide defense ... .

 

Here, the plaintiff established its prima facie entitlement to judgment as a matter of law by showing that the defendant executed the subject instruments, which contained unconditional promises to repay the plaintiff upon demand or at a definite time, and the defendant failed to pay in accordance with the terms of the instruments ... . Contrary to the Supreme Court's determination, in opposition, the defendant failed to establish the existence of a triable issue of fact with respect to a bona fide defense. The defendant claimed that the plaintiff fraudulently induced it to execute the promissory notes. However, the evidence submitted by the defendant failed to raise a triable issue of fact in this regard. Moreover, the defendant's conclusory allegations of fraud were insufficient to defeat the plaintiff's entitlement to summary judgment ... . Sun Convenient Inc v Sarasamir Corp, 2014 NY Slip Op 08827, 2nd Dept 12-17-14

 

 

CIVIL PROCEDURE/APPEALS

 

Only Parties "Aggrieved Within the Meaning of CPLR 5511" May Appeal

 

In finding that the appeal must be dismissed because the appellant was not "aggrieved within the meaning of CPLR 5511," the Second Department explained the meaning of "aggrieved" in this context:

 

"A person is aggrieved within the meaning of CPLR 5511 when he or she asks for relief but that relief is denied in whole or in part,' or, when someone asks for relief against him or her, which the person opposes, and the relief is granted in whole or in part'" ... . Saccheri v Cathedral Props Corp, 2014 NY Slip OP 08821, 2nd Dept 12-17-14

 

 

 

CIVIL PROCEDURE/FORECLOSURE

 

Bank Properly Sanctioned for Not Negotiating in Good Faith in Mandatory Foreclosure Settlement Conferences

 

The Second Department determined plaintiff bank had not negotiated in good faith in the mandatory foreclosure settlement conferences (required by CPLR 3408(f)).  The bank was sanctioned by precluding it from collecting interest on the mortgage for a period of several months:

 

Pursuant to CPLR 3408(f), the parties at a mandatory foreclosure settlement conference are required to negotiate in good faith to reach a mutually agreeable resolution (see CPLR 3408[f]; Wells Fargo Bank, N.A. v Meyers, 108 AD3d 9, 11). " The purpose of the good faith requirement in [CPLR 3408] is to ensure that both plaintiff and defendant are prepared to participate in a meaningful effort at the settlement conference to reach resolution'" (US Bank N.A. v Sarmiento, 121 AD3d 187, 200, quoting 2009 Mem of Governor's Program Bill, Bill Jacket, L 2009, ch 507, at 11). To conclude that a party failed to negotiate in good faith pursuant to CPLR 3408(f), a court must determine that "the totality of the circumstances demonstrates that the party's conduct did not constitute a meaningful effort at reaching a resolution" ... .

 

Here, the totality of the circumstances supports the referee's finding that the plaintiff failed to negotiate in good faith. The referee's finding was based, in part, upon the plaintiff's failure to follow guidelines pursuant to the federal Home Affordable Mortgage Program (hereinafter HAMP). The applicable guidelines required the plaintiff, as a lender participating in HAMP, to attempt to obtain a waiver of an investor prohibition or restriction in lowering the interest rate and to keep such evidence in the loan file (see Making Home Affordable Program, Handbook for Servicers of Non-GSE Mortgages, version 4.0, ch 2, § 6.5 at 99 [August 17, 2012]). However, despite repeated requests by the referee to produce evidence that the plaintiff attempted to obtain a waiver of the investor's restrictions in the PSA, the plaintiff failed to do so for more than one year. Therefore, the plaintiff failed to demonstrate that it followed HAMP regulations and guidelines, which, as several trial courts have concluded, constitutes a failure to negotiate in good faith pursuant to CPLR 3408(f)... . US Bank NA v Smith, 2014 NY Slip Op 08832, 2nd Dept 12-17-14

 

CONTRACT LAW

 

Breach of Contract Lawsuit Precluded by Claimant's Failure to Comply With Notice Requirements Which Were Conditions Precedent---Alleged Misconduct by Defendant Did Not Prevent Compliance with Conditions Precedent---Conditions Precedent Not Waived by Defendant's Participation In an Attempt to Resolve the Dispute

 

The Third Department noted that, absent any claim that defendant's misconduct prevented claimant from fulfilling the notice requirements in the contract, the notice requirements were conditions precedent which, because they were not met, precluded the breach of contract lawsuit:

 

Claimant alleged seven specific items of damages, each of which was subject to contract provisions requiring that notice be provided to defendant within 10 work days and that certain records be kept and submitted to defendant. The contract provided that "[t]he notification and record-keeping provisions of this Contract shall be strictly complied with for disputes of any nature and are a condition precedent to any recovery" ... . No party can prevail on a breach of contract claim if that party has failed to perform a specified condition precedent ... . According to the contract, the contractor's failure to supply the required notice and submit the required records is deemed a waiver of any related claim by the contractor, "notwithstanding the fact that [defendant] may have actual notice of the facts and circumstances which comprise such dispute and is not prejudiced by said failure."

 

Defendant established its entitlement to summary judgment by submitting proof that claimant did not comply with the condition precedent, in that claimant did not provide timely notice for the alleged items of damages and did not timely submit the required records ... . In response, claimant did not provide proof that it complied with the notice and record-keeping requirements, but argued that defendant waived noncompliance, had actual knowledge of the disputed items and prevented claimant from complying with those requirements. Those arguments are unavailing. Fahs Constr Group Inc v State of New York, 2014 NY Slip Op 0885, 3rd Dept 12-18-14

 

 

CONTRACT LAW/REAL PROPERTY LAW

 

Contract Giving Plaintiff Option to Sell the Property Back to the Defendants If Rezoning Not Obtained Was Ambiguous About When the Option Must Be Exercised Raising a Question of Fact About the Timeliness of Plaintiff's Exercise of the Option

 

The Second Department determined the contract rider which allowed plaintiff-purchaser to sell the property back to the defendants-sellers if rezoning and subdivision approvals were not obtained within 15 months was an option contract.  The defendants argued that the option must be exercised within a reasonable time and the plaintiff's failure to do so entitled defendants to summary judgment.  Supreme Court disagreed and granted plaintiff summary judgment (specific performance). The Second Department found that the contract was ambiguous concerning the time within which the option must be exercised, raising a triable question of fact:

 

An option contract is an agreement to hold an offer open; it confers upon the optionee, for consideration paid, the right to purchase--—or, less commonly, to sell --at a later date ... . Whether an agreement is an option contract or a bilateral contract is determined by reference to its various terms ... .

 

Here, as the defendants correctly contend, section 8(a) of the rider to the subject contract giving the plaintiff the right to sell the property back to [the defendants if plaintiff] failed to obtain certain rezoning and subdivision approvals was an option contract, as it conferred upon the plaintiff the right to sell the property back to Fairview at a later date.

 

However, in order for there to be an enforceable contract for the sale of land upon which an action for specific performance can be based, an optionee must exercise an option in accordance with its terms, within the time and the manner specified in the option ... .

 

Here, the plaintiff interprets the option contained in section 8(a) of the rider as providing it with an open-ended right to exercise same, and the Supreme Court agreed. The defendants, however, interpret the same provision as limiting the plaintiff's time to exercise the option to "a reasonable time" after the expiration of the aforementioned 15-month period in which to obtain the specified rezoning and subdivision approvals, and contend that the plaintiff failed to timely exercise its rights.

 

"Contract language which is clear and unambiguous must be enforced according to its terms" ... . However, ambiguity in a written agreement exists if there is more than one reasonable interpretation of the language at issue ... . The test for determining whether contract language is ambiguous is "whether the agreement on its face is reasonably susceptible of more than one interpretation" ... . Whether an agreement is ambiguous is a question of law to be resolved by the court ... . Here, we conclude that section 8(a) of the rider is ambiguous and subject to more than one interpretation regarding the time within which the plaintiff had to exercise the option. Since a triable issue of fact exists as to the intention of the parties, the Supreme Court erred in granting the plaintiff's motion for summary judgment on the cause of action for specific performance ... . IPE Asset Mgt LLC v Fairview Block & Supply Corp, 2014 NY Slip Op 08811, 2nd Dept 12-17-14

 

 

 

CORPORATION LAW/TAX LAW/LANDLORD-TENANT

 

Officer of Corporation Dissolved Pursuant to the Tax Law Is Personally Liable for Corporation's Lease Obligations

 

The Second Department determined that defendant, an officer of the defendant dissolved corporation, was personally liable for the dissolved corporation's lease obligations:

 

Pursuant to Tax Law § 203-a, the Secretary of State may dissolve a corporation by proclamation for the nonpayment of franchise taxes. Upon dissolution, the corporation's legal existence terminates and it is prohibited from carrying on new business (see ... Business Corporation Law § 1005[a][1]). It retains a limited de jure existence solely for the purpose of winding up its affairs (see ... Business Corporation Law §§ 1005[a][1], 1006). A person who purports to act on behalf of a dissolved corporation is personally responsible for the obligations incurred ... . Personal liability is not limited to the person who executes a contract on behalf of a dissolved corporation, but extends to the officers of the dissolved corporation ... . 80-02 Leasehold LLC v CM Realty Holdings Corp, 2014 NY Slip Op 08805, 2nd Dept 12-17-14

 

 

 

CRIMINAL LAW

 

Attempted Murder and Attempted Robbery Convictions, Under the Facts, Required Concurrent, Not Consecutive, Sentences---Applicable Law Described in Some Depth

 

The Second Department determined defendant, who was convicted of attempted murder and attempted robbery, must be sentenced to concurrent, not consecutive, terms of imprisonment for those two offenses.  The defendant displayed a handgun and demanded money from the victim.  When the victim refused, the defendant struck and shot the victim:

 

Penal Law § 70.25(2) provides that concurrent sentences must be imposed "for two or more offenses committed through a single act or omission, or through an act or omission which in itself constituted one of the offenses and also was a material element of the other." "Thus, sentences of imprisonment imposed for two or more offenses may not run consecutively (1) where a single act constitutes two offenses, or (2) where a single act constitutes one of the offenses and a material element of the other" ... . However, "trial courts retain consecutive sentence discretion when separate offenses are committed through separate acts, though they are part of a single transaction" ... . 

 

Here, consecutive sentences may not be imposed because the act which constituted the offense of attempted murder in the second degree was a material element of the offense of attempted robbery in the first degree. A person is guilty of attempted murder in the second degree when, with intent to commit murder, he or she engages in conduct which tends to cause the death of another person (see Penal Law §§ 110.00, 125.25[1]). A person is guilty of attempted robbery in the first degree, under the Penal Law section charged here, when he or she attempts to forcibly steal property and is armed with a deadly weapon (see Penal Law § 160.15[2]). A person forcibly steals when he or she, in the course of committing a larceny, uses or threatens the immediate use of physical force to prevent or overcome resistance to the taking of the property or to compel the owner to deliver the property (see Penal Law § 160.00[1], [2]). Here, the actus reus of the attempted murder charge was the firing of three shots at Moore, and the actus reus of the attempted robbery charge was the use or threatened use of physical force to attempt to steal property while armed with a deadly weapon. The act which constitutes attempted murder in the second degree is subsumed within the element of using force. Thus, the act constituting attempted murder in the second degree can be a material element of attempted robbery in the first degree ... .

 

In addition, the People have failed to establish that the acts constituting the attempted robbery in the first degree were separate and distinct from the acts constituting the attempted murder in the second degree ... . Here, consecutive sentences could not be imposed because it is impossible to determine whether the firing of three gun shots at Moore, which formed the basis of the verdict of guilt on the attempted murder charge, was also the use of force which formed the basis of the jury's verdict of guilt on the attempted robbery charge ... . Therefore, the People have failed to establish that the acts constituting attempted robbery in the first degree were separate and distinct from those constituting attempted murder in the second degree. People v Grant, 2014 NY Slip Op 08859, 2nd Dept 12-17-14

 

 

CRIMINAL LAW

Reference to Statute in Indictment Cures Any Omission from the Indictment's Description of the Elements of the Offense

 

The Third Department noted that failure to include an element of an offense in the description of the offense in the indictment is cured by a reference (in the indictment) to the relevant statute:

 

To be sure, defendant's claim that the indictment at issue is jurisdictionally defective survives both his guilty plea and his waiver of the right to appeal ... . That said, "[w]here an indictment count incorporates by reference the statutory provision applicable to the crime intended to be charged, it has been repeatedly held that this is sufficient to apprise the defendant of the charge and, therefore, renders the count jurisdictionally valid" ... .

 

Here, defendant pleaded guilty under count 1 of the indictment to the reduced charge of attempting promoting prison contraband in the first degree (see Penal Law §§ 110.00, 205.25 [1]). While it is true that count 1 of the indictment did not allege that defendant "knowingly and unlawfully" introduced dangerous contraband into the correctional facility where he was incarcerated, said count did expressly incorporate by reference the provisions of Penal Law § 205.25 (1), thereby rendering such count jurisdictionally valid... . People v Cane, 2014 NY Slip Op 08879, 3rd Dept 12-18-14

 

 

CRIMINAL LAW/EVIDENCE/VEHICLE AND TRAFFIC LAW

 

In a DWI Case, Operation Proved by Circumstantial Evidence

 

[Although Not Summarized Here, the Decision, Which Affirmed the Conviction, Includes In Depth Discussions of a Juror Selection Issue (Failure to Address Bias Was Error but Not Reversible Error Even though Peremptory Challenges Exhausted), a Juror Qualification Issue (Juror Related to Witness Brought to Court's Attention When Witness Testified), and Related Ineffective Assistance Issues]

 

The Third Department determined circumstantial evidence the defendant had been driving while intoxicated was sufficient.  The defendant went to a witness' home seeking assistance after his car ended up in a ditch.  [Although not summarized here, the decision, which affirmed the conviction, also has in depth discussions of errors in juror selection (failure to address bias expressed by a juror re: a DWI case where peremptory challenges eventually exhausted), the criteria for juror disqualification when a juror is related to a witness but does not realize it until the witness testified, and related ineffective assistance claims.]: 

 

A defendant need not be driving to operate a vehicle for purposes of the Vehicle and Traffic Law; it is enough if the evidence shows that he or she is behind the wheel with the engine running ... . The testimony was that when defendant arrived on [a witness'] doorstep to request assistance with getting the car out of the ditch, he was alone and smelled of alcohol. In addition to the testimony of [witnesses] describing his efforts, defendant acknowledged that he was behind the wheel of the car, and that the car was running with the wheels spinning as he attempted to drive the car out of the ditch. These factors are sufficient to establish that defendant was operating a motor vehicle on a public highway ... . People v Colburn, 2014 NY Slip Op 08875, 3rd Dept 12-18-14

 

 

CRIMINAL LAW/EVIDENCE/CONSTITUTIONAL LAW

 

Admission Into Evidence of Nontestifying Codefendant's Grand Jury Testimony Violated Defendant's Sixth Amendment 
Right of Confrontation

 

The First Department reversed defendant's conviction, finding that the admission into evidence of the codefendant's grand jury testimony violated the rule announced in Bruton v US, 391 US 123:

 

Under Bruton v United States, "a defendant is deprived of his Sixth Amendment right of confrontation when the facially incriminating confession of a nontestifying codefendant is introduced at their joint trial, even if the jury is instructed to consider the confession only against the codefendant" ... . Since the rule only applies where the codefendant's statement was "incriminating on its face, and [not where it] became so only when linked with evidence introduced later at trial" ..., the question before us is whether the codefendant's grand jury testimony was facially incriminating as to defendant, rather than incriminating only when linked to other evidence. * * *

 

Although the codefendant's grand jury testimony was intended as an innocent explanation of the events surrounding the alleged robbery, and admitted no wrongdoing, nevertheless it was "facially incriminating" as to defendant within the meaning of Bruton.

 

The codefendant's narrative placed defendant with the codefendant throughout the relevant events and, specifically referring to defendant approximately 40 times, described defendant's conduct. Among other things, the statement recounted that, after defendant's return to the codefendant's car following an absence to "get food," the alleged robbery victim (an undercover officer) appeared at the car window, asked where the "stuff" was, and dropped prerecorded buy money (the property allegedly stolen in the charged robbery) into the car. This narrative suffices to create an inference that defendant, while outside the codefendant's vehicle, had purported to set up a deal for a sale of contraband that was to culminate in the vehicle, but did not fulfill the deal once he entered the vehicle.  People v Johnson, 2014 NY Slip Op 08765, 1st Dept 12-16-14

 

 

CRIMINAL LAW/EVIDENCE/CONSTITUTIONAL LAW/APPEALS

 

Out-of-Court Statement Leading to Discovery of the Weapon Did Not Violate Defendant's Right of Confrontation Because There Was No "Direct Implication" the Statement Involved the Defendant's Possession of the Weapon

 

The Second Department determined that the right of confrontation issue was preserved for appeal because, although not raised directly, the issue was specifically determined by Supreme Court.  The court further determined that the testimony which alluded to an out-of-court statement leading to the discovery of a blood-covered knife did not violate defendant's right of confrontation:

 

Contrary to the People's contention, the Confrontation Clause (see US Const, 6th amend) issue is preserved for appellate review. While the issue was not "plainly present[ed]" to the Supreme Court ..., the court's ruling on the defendant's objection demonstrates that the court specifically considered and resolved this issue ... .

 

The defendant's constitutional right to be confronted with the witnesses against him prohibits the "admission of testimonial statements of a witness who did not appear at trial unless he [or she] was unavailable to testify and the defendant ha[s] had a prior opportunity for cross-examination" ... . Here, however, Sergeant Tribble's testimony and the subsequent testimony relating to the discovery of the weapon did not violate the Confrontation Clause, since there was no direct implication that the nontestifying witness told the police that the defendant possessed the knife, disposed of it, or tried to conceal it ... . People v Richberg, 2014 NY Slip Op 08863, 2nd Dept 12-17-14

 

 

 

DISCIPLINARY HEARINGS (INMATES)

 

"Possession of Unauthorized Medication" Charge Could Not Stand---Chain of Custody of the Pills Not Demonstrated

 

The Third Department determined the inmate's "possession of unauthorized medication" charge could not stand because the chain of custody of the pills was not demonstrated:

 

The procedure to be followed when a suspected contraband drug is found dictates that correction officials prepare "a request for test of suspected contraband drugs" and that "[e]ach person handling the suspected substance shall make an appropriate notation on the form to document . . . the chain of custody of the substance until it is identified" (7 NYCRR 1010.4 [b]). Petitioner sought a copy of the request form with proof of chain of custody and, indeed, sought to have the charges against her dismissed because that document had not been provided to her. Despite her complaints, the Hearing Officer made no effort to obtain either the request form or any other proof to establish the chain of custody... . Matter of Sanabria v Annucci, 2014 NY Slip Op 08893, 3rd Dept 12-18-14

 

 

 

FAMILY LAW/CONTRACT LAW

 

Criteria for Challenge to Prenuptial Agreement Not Met

 

The First Department determined Family Court properly denied plaintiff's request to extend the time for challenging a prenuptial agreement.  The court explained the analytical criteria for such a challenge:

 

New York has a long-standing "strong public policy favoring individuals ordering and deciding their own interests through contractual arrangements" ... . It is axiomatic that a duly executed prenuptial agreement is presumed to be valid and controlling unless and until the party challenging it meets his or her very high burden to set it aside ... . However, in many instances, "agreements addressing matrimonial issues have been subjected to limitations and scrutiny beyond that afforded contracts in general" ... . Although "there is a heavy presumption that a deliberately prepared and executed written instrument manifests the true intention of the parties" ..., an agreement between prospective spouses may be invalidated if the party challenging the agreement demonstrates that it was the product of fraud, duress, or other inequitable conduct ... . Nevertheless, such results remain the exception rather than the rule. The burden of producing evidence of such fraud, duress or overreaching is on the party asserting the invalidity of the agreement ... . Anonymous v Anonymous, 2014 NY Slip Op 08766, 1st Dept 12-16-14

 

 

CIVIL PROCEDURE/MUNICIPAL LAW

 

Article 78 Is Proper Mechanism for Seeking Return of Property Held by the Police Department/Here Petitioner Was Not Entitled to Return of Firearm Not Licensed in New York/Firearms Owners' Protection Act Did Not Apply

 

The Second Department determined that, although an Article 78 proceeding can be used to seek the return of property from the police department, the proceeding can not be used to seek the return of contraband.  Under the facts here, the firearm at issue was contraband because the petitioner did not have a license to possess it in New York, in spite of the fact the firearm had been legally purchased and possessed in California. In addition, the court held that the petitioner was not simply transporting the firearm through New York, an act protected by the Firearms Owners' Protection Act (18 USC 926A):

 

Under the circumstances of this case, the Supreme Court correctly determined that the Firearm Owners' Protection Act (18 USC § 926A) was not applicable. "Section 926A permits a licensee, in certain circumstances, to transport a firearm from any place where he may lawfully possess and carry such firearm to any other place where he may lawfully possess and carry such firearm'" ... . The firearm owner must be actually engaging in travel or acts incidental to travel ..., and during the transportation, the weapon and ammunition must not be readily accessible ... . Here, the petitioner failed to establish that he was only engaged in travel through New York so as to invoke the protection of section 926A ... . Matter of Khoshneviss v Property Clerk of NYC Police Dept, 2014 NY Slip Op 08844, 2nd Dept 12-17-14

 

 

MALICIOUS PROSECUTION/FALSE ARREST/MUNICIPAL LAW/EVIDENCE

 

Deeply Divided Court Reverses Plaintiff's Malicious Prosecution-False Arrest Verdict and Orders a New Trial/Error Not to Allow Unredacted Autopsy Report Into Evidence/The Nature of the Evidence Necessary to Demonstrate Probable Cause to Arrest Was the Core of the Disagreement Among the Justices

 

The First Department, over a two-justice dissent, reversed a plaintiff's verdict and ordered a new trial.  Plaintiff's baby died a few weeks after birth.  The medical examiner concluded that the baby died of malnutrition that was not due to a detectable defect in her digestive system.  The plaintiff was charged with the baby's death, but the charges were dropped about a month later. Plaintiff sued the city, alleging malicious prosecution and false arrest.  Both causes of action require a finding that the police did not have probable cause to arrest.  The probable cause determination was left to the jury (which concluded the police did not have probable cause).  The majority decided it was reversible error not to admit the full autopsy report, including the redacted conclusion that the "manner of death" had been "homicide (parental neglect)."  The dissent vehemently argued that the arresting officer had enough information, both from the autopsy report and his investigation, to conclude that the baby had been adequately fed and that, therefore, the jury's finding the officer did not have probable cause to arrest was supported by the evidence. The concurring decision vehemently disagreed with the dissent, arguing that the arresting officer had probable cause as a matter of law:

 

From the concurrence:

 

"Probable cause exists if the facts and circumstances known to the arresting officer warrant a prudent person in believing that the offense has been committed" ... . "The evidence necessary to establish probable cause to justify an arrest need not be sufficient to warrant a conviction" ... . And, as previously discussed, conflicting evidence as to guilt or innocence, and discrepancies in the case being built against the arrested person, while relevant to the prosecution's ability to prove guilt beyond a reasonable doubt at trial, are not relevant to the determination of whether there was probable cause for an arrest ... . Further, "when the facts and circumstances are undisputed, when only one inference [concerning probable cause] can reasonably be drawn therefrom and when there is no problem as to credibility . . . , the issue as to whether they amount to probable cause is a question of law" ... . Since there is no dispute about either (1) plaintiff's status as the infant's sole custodian, (2) the contents of the autopsy report, or (3) the detective's reliance upon the autopsy report in making the arrest and initiating the subsequently aborted prosecution, probable cause for plaintiff's arrest and prosecution existed as a matter of law. It follows that this case should not have been submitted to the jury and that the City's motion for judgment notwithstanding the verdict should have been granted. * * *

 

From the dissent:

 

The evidence demonstrated that notwithstanding the conclusion in the autopsy report that the child died of malnutrition, the detective testified that two medical professionals who viewed the child's body saw no apparent signs of neglect or abuse, found food in the child's stomach, and concluded that she appeared to be well fed. Thus, there was no indication that plaintiff had either intentionally, recklessly or negligently starved the infant. The jury reasonably could have found that, at the time of arrest, there was no basis for a prudent person to believe that an offense had been committed. That is, that the mother did not act recklessly or negligently in feeding the child and/or not realizing that the child was malnourished, or did not in fact commit any offense whatsoever. * * * ... [T]he contents of the report along with the other evidence did not provide probable cause to believe that a crime had been committed. Moreover, under the circumstances of this case, it cannot be said that "it was reasonable, as a matter of law," for the detective to discredit plaintiff's account. Cheeks v City of New York, 2014 NY Slip Op 08764, 1st Dept 12-16-14

 

 

 

INSURANCE LAW/ARBITRATION

 

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

 

 

INSURANCE LAW/NEGLIGENCE/LANDLORD-TENANT

 

Insurer of Lessee Obligated to Defend and Indemnify the Owner/Lessor of the Premises (Named as an Additional Insured) Re: a Slip and Fall on the Sidewalk in Front of the Premises/Use of the Sidewalk Constitutes "Use of the Leased Premises" Within the Meaning of the Policy

 

The Second Department determined the insurer, Continental, was obligated to defend and indemnify the plaintiff-owner of the premises re: a slip and fall on the sidewalk in front of the premises. The premises was leased to the insured, "White Plains," and sublet to "Pretty Girl," a retail store.  The owner/lessor was named as an additional insured in the Continental policy:

 

The Continental policy contains an endorsement stating that a lessor of premises is an additional insured with respect to liability arising out of the ownership, maintenance, or use of the specific part of the premises leased. The plaintiffs, who are the owners and lessors of the subject premises, established that their potential liability in the underlying action arises out of the ownership, maintenance, or use of the specific part of the premises leased to Continental's insured, White Plains Sportswear Corp., and sublet to Pretty Girl, Inc.

 

Inasmuch as New York City Administrative Code § 7-210 imposes liability on owners of commercial property for defective conditions on sidewalks, the plaintiffs' potential liability arises from their ownership of the leased premises ... . The underlying claim arises out of the maintenance or use of the leased premises, as the sidewalk was necessarily used for access in and out of the leased building ... . Frank v Continental Cas Co, 2014 NY Slip Op 08808, 2nd Dept 12-17-14

 

 

 

MUNICIPAL LAW/NEGLIGENCE/CIVIL PROCEDURE

 

Complaint Can Not Be Deemed a Late Notice of Claim/Application to File a Late Notice of Claim Can Not Be Granted After the Statute of Limitations Has Run/City Is Not Required to Plead the Failure to File a Notice of Claim as a Defense/Participation in Discovery Did Not Preclude the City from Moving to Dismiss Based Upon Plaintiff's Failure to File a Notice of Claim (After the Statute of Limitations Had Run)

 

The Second Department reversed Supreme Court's determination that the complaint be deemed a late notice of claim against the city in a slip and fall case.  The court noted that Supreme Court did not have the power to accept the complaint as a late notice of claim, did not have the power to grant an application to file a late notice of claim after the statute of limitations had passed, the city was under no obligation to plead the absence of a notice of claim as a defense, and the city was not precluded from raising the defense by participating in discovery:

 

Here ... the Housing Authority ... was "under no obligation to plead, as an affirmative defense, the plaintiff's failure to comply with the statutory notice of claim requirement" ... . "Furthermore . . . participation in pretrial discovery did not preclude [it] from raising the untimeliness of the notice of claim" ... . In short, there is no evidence in the record demonstrating that the Housing Authority engaged in any misleading conduct which would support a finding of equitable estoppel ... . Furthermore, there is no indication in the record that the plaintiff relied upon any alleged act or omission of the Housing Authority or that such reliance caused the plaintiff to change her position to her detriment or prejudice ... . Accordingly, the Supreme Court should have granted the Housing Authority's motion for summary judgment dismissing the complaint on the ground that the plaintiff failed to serve a timely notice of claim, and denied that branch of the plaintiff's cross motion which was to deem the complaint to be a late notice of claim and to deem it to have been timely served nunc pro tunc.  Feliciano v NYC Hous Auth, 2014 NY Slip OP 08807, 2nd Dept 12-17-14

 

 

NEGLIGENCE

 

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

 

 

NEGLIGENCE/MUNICIPAL LAW

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

 

 

NEGLIGENCE/EMPLOYMENT LAW

Negligent Training and Supervision Causes of Action Properly Survived Summary Judgment/Lawsuit Stemmed from Sexual Contact Between an Employee of Defendant Residential Facility and Plaintiff, Who Was 14 Years Old

 

In a case stemming from an employee's (Williams') sexual contact with the plaintiff, a 14-year-old resident of defendant Berkshire Farm Center and Services for Youth, the Third Department determined the negligent training and supervision causes of action properly survived summary judgment:

 

In order to succeed on a claim of negligent training and supervision of an employee, it must be demonstrated that the employer "knew or should have known of the employee's propensity for the conduct which caused the injury" ... and that the allegedly deficient supervision or training was a proximate cause of such injury ... . In support of its motion seeking the dismissal of plaintiff's negligent training and supervision claims, defendant presented testimony from its employees — including those who assumed supervisory positions — indicating that there were no prior indicia or reports of any inappropriate conduct by Williams toward the youths residing in the detention facility and that the news of the incident with plaintiff came as a complete surprise ... . * * *

 

...Review of the testimony of defendant's employees reveals that there was a general reluctance on the part of several staff members to report policy violations to supervisors or register complaints regarding staff conduct. Two staff members, in particular, testified that the director was not responsive to reports of improper conduct and she disregarded staff concerns regarding, among other things, scheduling male counselors to work alone during overnight shifts while there were female residents — some of whom were characterized as highly sexually active — in the facility. One staff member testified that he was aware of an incident in which Williams told plaintiff that she was "sexy" as she was returning to her room in a towel after having taken a shower, but he did not confront Williams or report it to his supervisors. Other evidence exists evincing Williams' propensity to engage in inappropriate contact with youths in the facility, including one occasion where it was discovered that a female resident had written Williams' phone number on a slip of paper. Rather than make a comprehensive inquiry about the matter, defendant limited its investigation to questioning the female and Williams. Despite the nature of the incident, defendant's director denied having any concerns about Williams' interaction with the residents. Other testimony by staff members described Williams as a counselor who appeared to relish having authority over the children and he acted aggressively toward them and without apparent concern for their interests. Specifically, one counselor averred that he observed Williams tell a female resident that he would "be with her" under different circumstances and that, although this staff member reported the exchange to a supervisor, Williams was not disciplined. Other complaints to supervisors regarding Williams' improper conduct appear to have gone unaddressed, causing one counselor to opine during his deposition that such reports "went in one ear and out the other." Viewing this evidence, as well as counselor testimony that defendant did not test or otherwise ensure that its staff members were knowledgeable and compliant with its written policies and instructional materials, in a light most favorable to plaintiff, we find that material issues of fact preclude summary judgment on these causes of action ... . Hicks v Berkshire Farm Ctr & Servs for Youth, 2014 NY Slip Op 0889, 3rd Dept 12-18-14

 

 

 

NEGLIGENCE/ACCOUNTANT MALPRACTICE/AGENCY

 

Adverse Interest Exception to In Pari Delicto Defense May Apply---The Two Concepts Are Briefly Explained

 

In an accounting malpractice action, the Second Department determined the defendants' motion to dismiss based upon the defense of in pari delicto defense was properly denied because the adverse interest exception may apply.  The court explained the two concepts:

 

The defendants contend that [the accounting malpractice] cause of action is barred by the doctrine of in pari delicto, "which mandates that the courts will not intercede to resolve a dispute between two wrongdoers" ... . However, the adverse interest exception to the doctrine of in pari delicto provides that "when an agent is engaged in a scheme to defraud his principal, either for his own benefit or that of a third person, the presumption that knowledge held by the agent was disclosed to the principal fails because he cannot be presumed to have disclosed that which would expose and defeat his fraudulent purpose" ... . Here, the documentary evidence submitted by the defendants did not conclusively foreclose the application of the adverse interest exception to the in pari delicto defense ... . Schwartz v Leaf Salzman Mangenelli Pfiel, & Tendler LLP, 2014 NY Slip Op 08823, 2nd Dept 12-17-14

 

 

NEGLIGENCE/CONTRACT LAW

 

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

 

 

NEGLIGENCE/CONTRACT LAW

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

 

 

NEGLIGENCE/CONTRACT LAW/CIVIL PROCEDURE

 

In the Absence of Allegations in the Pleadings Supporting an "Espinal" Exception to the Rule that Tort Liability to Third Persons Does Not Arise from a Contract, No Question of Fact Was Raised About a Duty Owed by the Defendant to the Plaintiff

 

The Second Department determined the complaint in a slip and fall case was properly dismissed.  There apparently was a contract between the defendant cleaning services company, One-A, and plaintiff's employer.  Plaintiff slipped and fell on a wet floor. The court explained the Espinal criteria for tort liability to third parties arising from a contract and then found that, because plaintiff was not a party to the cleaning-services contract, the cleaning-services company did not owe her a duty of care:

 

Generally, a contractual obligation, standing alone, will not give rise to tort liability in favor of a third party ... . Nonetheless, the Court of Appeals has recognized three exceptions to this general rule: (1) where the contracting party, in failing to exercise reasonable care in the performance of his or her duties, launches a force or instrument of harm; (2) where the plaintiff detrimentally relies on the continued performance of the contracting party's duties; and (3) where the contracting party has entirely displaced another party's duty to maintain the premises safely ... . As part of its prima facie showing, a contracting defendant is only required to negate the applicability of those Espinal exceptions that were expressly pleaded by the plaintiff or expressly set forth in the plaintiff's bill of particulars ... . Here, given the allegations in the complaint and the plaintiff's bill of particulars, One-A established its prima facie entitlement to judgment as a matter of law simply by offering sufficient proof that the plaintiff was not a party to its contract to clean the floor of the premises, and that it thus owed her no duty of care ... . In opposition, the plaintiff failed to raise a triable issue of fact ... . Glover v John Tyler Eters Inc, 2014 NY Slip Op 08809, 2nd Dept 12-17-14

 

 

NEGLIGENCE/EVIDENCE

 

Although Plaintiff Could Not Identify the Cause of Her Fall, A Question of Fact Was Raised Re: the Cause by Circumstantial Evidence

 

The Second Department determined that, although the plaintiff was unable to identify the cause of her fall, she was able to raise a question of fact about the cause from circumstantial evidence:

 

In a trip-and-fall case, a defendant may establish its prima facie entitlement to judgment as a matter of law by submitting evidence that the plaintiff cannot identify the cause of his or her fall ... . However, that a defective or dangerous condition was the proximate cause of an accident can be established in the absence of direct evidence of causation and may be inferred from the facts and circumstances underlying the injury ... .

 

Here, the defendants met their burden of establishing their prima facie entitlement to judgment as a matter of law by demonstrating that the plaintiff was unable to identify the cause of her accident without engaging in speculation ... . However, in opposition, the plaintiff raised a triable issue of fact, inter alia, through circumstantial evidence, as to whether the cause of her fall was a cracked and/or unlevel condition on the defendants' driveway ... . Buglione v Spagnoletti, 2014 NY Slip Op 08801, 2nd Dept 12-17-14

 

 

NEGLIGENCE/MUNICIPAL LAW

 

Sheriff's Deputy's Driving During an Emergency Operation Did Not Rise to the "Reckless Disregard" Standard for Liability

 

The Third Department determined summary judgment was properly granted in favor of the sheriff's department because the conduct of the sheriff's deputy (Curry) involved in the vehicle accident did not meet the "reckless disregard" standard for vehicles involved in "emergency operations."  The accident happened when the deputy made a U-turn because he noticed a police officer who appeared to be "having trouble with" a detained suspect:

 

"Vehicle and Traffic Law § 1104 (a) exempts the drivers of authorized emergency vehicles from the requirements of certain traffic laws when they are 'involved in an emergency operation'" ... . This statutory qualified immunity "precludes the imposition of liability for otherwise privileged conduct except where the conduct rises to the level of recklessness" ... . By statute, "[e]very . . . police vehicle" is an "authorized emergency vehicle" within the meaning of Vehicle and Traffic Law § 1104 (a) and (b) (Vehicle and Traffic Law § 101 [emphasis added]), and the fact that Curry's police vehicle was unmarked does not compel a contrary conclusion (see Vehicle and Traffic Law § 101...), although it may be relevant to the inquiry into whether he acted recklessly ... . 

 

We further find that Curry was exempt from certain traffic laws because he was engaged in an "emergency operation" (Vehicle and Traffic Law §§ 114-b, 1104 [a]...). Specifically, among other privileges, Curry was entitled to "[d]isregard regulations governing directions of movement or turning in specified directions" (Vehicle and Traffic Law § 1104 [b] [4]) and to "[s]top" his vehicle regardless of other traffic laws (Vehicle and Traffic Law § 1104 [b] [1]). Thus, while U-turns were not permitted at this location, Curry was permitted to stop or slow his vehicle in traffic and to make a U-turn, provided he did not act recklessly ... . The evidence is undisputed that Curry, having acted to assist an officer who appeared to be having trouble with a detained suspect, was undertaking an "emergency operation."  Jones v Albany County Sheriff's Dept, 2014 NY Slip Op 08895, 3rd Dept 12-18-14

 

 

 

REAL PROPERTY TAX LAW

 

Reassessment of Improved Property Was Not an Unconstitutional Selective Assessment

 

Reversing Supreme Court, the Second Department determined the reassessment of petitioner's property after the construction of improvements on the property was not an unconstitutional selective assessment:

 

Contrary to the determination of the Supreme Court, the petitioner failed to establish that there was an unconstitutional selective reassessment of the subject property. "It is well settled that a system of selective reassessment that has no rational basis in law violates the equal protection provisions of the Constitutions of the United States and the State of New York. Nevertheless, reassessment upon improvement is not illegal in and of itself . . . [n]or is the use of the purchase price or the current market value to reach a tax assessment in and of itself unconstitutional so long as the implicit policy is applied even-handedly to all similarly situated property" (Matter of Leone Props., LLC v Board of Assessors for Town of Cornwall, 81 AD3d 649, 650-651 [internal quotation marks omitted]). Here, the assessor testified at trial that whenever a new house is constructed on property, she visits the property and estimates the market value of the property, while considering comparable sales of improved property, land sales, and the construction costs of typical homes. The petitioner failed to submit any evidence demonstrating that the City assessed newly constructed property at a higher percentage of market value than existing property ... . Matter of Carroll v Assessor of City of Rye NY, 2014 NY Slip Op 08837, 2nd Dept 12-17-14

 

 

 

WORKER'S COMPENSATION/ARBITRATION/APPEALS

 

Worker's Compensation Award Made by Arbitrator Pursuant to an Authorized Dispute Resolution Program Is Reviewed Under the Appellate Court's Limited Arbitration-Review Powers (Not Under the Usual "Substantial Evidence" Standard)

 

The Third Department noted that a worker's compensation award made by an arbitrator pursuant to an authorized dispute resolution program is not reviewed by the Worker's Compensation Board and is reviewed by the appellate court under the court's limited arbitration-review powers:

 

Workers' compensation claims generally reach this Court on direct appeal from decisions of the Workers' Compensation Board and are subject to the substantial evidence standard of review (see Workers' Compensation Law § 23...). On the other hand, determinations of workers' compensation claims by arbitrators pursuant to an authorized alternative dispute resolution program are not reviewed by the Board, but may be appealed directly to this Court (see Workers' Compensation Law § 25 [2-c] [d]; 12 NYCRR 314.3 [b]). The substantial evidence standard does not apply to appeals of claims reaching us through the latter procedural route ... . Instead, these cases are reviewed under the standard applicable to review of arbitration awards in general (see CPLR 7511).

 

Pursuant to that standard, courts have limited power to review an arbitrator's award ... . Courts may vacate an arbitration award only if it was procured by "corruption, fraud or misconduct," if the arbitrator was biased (CPLR 7511 [b] [1] [i]; see CPLR 7511 [b] [1] [ii]) or "if [the award] violates a strong public policy, is irrational, or clearly exceeds a specifically enumerated limitation on the arbitrator's power" ... . "[A]n arbitrator's award should not be vacated for errors of law and fact committed by the arbitrator and the courts should not assume the role of overseers to mold the award to conform to their sense of justice"..., nor should courts "otherwise pass upon the merits of the dispute" ... . Matter of Diaz, v Kleinknecht Elec, 2014 NY Slip Op 0882, 3rd Dept 12-18-14