In Sultan v. Connery, New York County Supreme Court Justice Marcy Friedman addressed an array of claims that had been filed against Sean Connery (of James Bond fame), his family, lawyers, and contractors for repair work performed on the Connerys' condominium. Playing the role of “Dr. No,” Justice Friedman dismissed a large chunk of the case and chastised the parties for their “slash and burn” tactics.

(We wouldn't have expected less from the former "spy.")

The Sultans and Connerys share a two-unit condominium townhouse in Manhattan. In 2001, the Connerys undertook renovations to their unit and sought the Sultans’ approval to repair the roof. Eventually, the parties submitted their dispute to arbitration and the arbitrator allowed the Connerys to proceed with the work, but directed that the Sultans be compensated for damage incurred during the renovation process.

Dissatisfied with that outcome, the Sultans filed a series of civil lawsuits and a summary eviction proceeding against the Connerys. (Those cases were dismissed for various defects.)

The Connerys countered with six lawsuits of their own against the Sultans -- seeking to enforce the arbitration award, appoint a receiver, and evict the Sultans. Particularly galling to Friedman was the Connerys’ attempt to start a suit in Nassau County, rather than in Manhattan where the property was situated. And, the Connerys reportedly violated a court rule by failing to list all of the parties' related litigation on a form which had been filed with the court when one of the lawsuits had been filed.

In this latest chapter of this saga, the Sultans sued the Connerys and their contractors for personal injury and property damage resulting from the 2001 repair work, and also asserted a claim against the Connerys’ lawyers for frivolous litigation practices. The Connerys, on the other hand, asked the court to dismiss the case, to prohibit the Sultans from filing additional litigation, and for an award of sanctions.

While the Court dismissed most of the relief sought by the Sultans, either for failure to state a legally cognizable basis for relief or because the matters had been addressed in prior litigation, a few claims against the Connerys, and some of their contractors, were allowed to survive.

Interestingly, the Court sanctioned the Sultans and their counsel for frivolous practices, and awarded attorneys’ fees to the contractors whose work had been performed prior to 2001. (Since a "time bar" or "statute of limitations" applied, any relief sought against those parties was not viewed as meritorious.)

Justice Friedman declined to award attorneys’ fees to the Connerys, or to reimburse their counsel for the latter’s own defense costs. And, while the Court refused to prohibit the Sultans from further litigation, it ordered the parties to disclose all prior lawsuits to the court clerk should either side opt to file another case in the future.

Finally, and most importantly, Justice Friedman urged the parties to mediate their differences in order to “restore normalcy to this most unfortunate situation in which the neighbors have wholly lost the ability to cooperate” with the other.

While that was certainly sound advice, it ain't likely to bond ... James Bond.

To download a copy of the Supreme Court's decision, please use this link: Sultan v. Connery 

-----------------------------

Special thanks to our friend, Gines Pasamonte, for flagging this case to us.

Posted by Lucas A. Ferrara, Esq. at 8:25 AM | Permalink | TrackBacks (0) | Comments (7)

In Wilkie v. Robbins, the U.S. Supreme Court held that a rancher harassed by the Bureau of Land Management (BLM) could not seek recompense by way of a Racketeer Influenced and Corrupt Organizations Act (RICO) suit or by way of a constitutional claim.

In May 1994, Frank Robbins purchased the High Island Ranch, a resort in Wyoming that allows guests to take part in cattle drives. The Ranch stretches across a patchwork of 40 miles of land, with sections accessible only through tracts belonging to private owners, the state of Wyoming, and the U.S. government.

In March 1994, George Nelson, the previous owner of the Ranch, negotiated reciprocal easements with the BLM, allowing both landowners to access isolated tracts of their land. However, the BLM did not record its easement, so when Robbins purchased the property, he acquired it free of any encumbrances.

In June 1994, BLM official Joseph Vessels contacted Robbins, asking him for the easement rights that had not been recorded. When Robbins advised he would consider the request for a price, Vessels responded by saying, “the Federal Government does not negotiate.” 

The following “campaign of harassment” ensued:

• Vessels ordered BLM officials to trespass on Robbins’s property to survey the desired easement and then bragged to Robbins about it. 
  
• BLM officials were instructed to monitor Robbins closely, to ensure his employees and guests did not trespass onto neighboring lands. (One BLM employee, Edward Parodi, testified that he retired early rather than participate in that activity.) 
  
• In October 1995, Robbins’s 5-year license to graze livestock on federal land was revoked, and replaced with one requiring annual review. (He subsequently lost that license.) 
  
• In July 1997, federal employees again entered Robbins’s property, this time leading to an altercation. Robbins was charged with two counts of knowingly and forcibly impeding and interfering with a federal employee, punishable by up to a year in prison. A jury deliberated just 30 minutes before acquitting Robbins, with many jurors appalled at the government’s actions.
  
• In August 2000, federal employees videotaped the Ranch’s guests (even while they relieved themselves).

The nation’s highest court noted that Robbins had failed to exhaust all available remedies during that time period. (For instance, he did not appeal the revocation of his grazing license.) Instead, Robbins opted to file suit in U.S. District Court against a group of government officials, asking for damages under the RICO statute and under a “Bivens-like” theory which sought monetary damages for the violation of his constitutionally guaranteed property rights. While the District Court and the Court of Appeals for the Tenth Circuit allowed Robbins’s claims to survive dismissal, the U.S. Supreme Court overturned and ended Robbins’s case.

RICO is typically used to criminally convict organized crime bosses for “racketeering,” and also provides civil damages to extortion victims. While the Supremes acknowledged that RICO may be applied to government officials, they must engage in criminal acts for their own benefit.  Since Robbins did not allege the officials acted with self-interest, his RICO claim faltered.

In Bivens v. Six Unknown Federal Narcotics Agents, a plaintiff, whom federal agents arrested, interrogated, and strip searched without a warrant, was permitted to sue those officers for redress of Fourth Amendment violations. Although no federal law provided a basis for relief, the U.S. Supreme Court held that a remedy derived from the Constitution itself. Since Bivens, individuals faced with constitutional violations have argued for its application and extension.

In declining to apply a Bivens-like remedy to the case, the U.S. Supreme Court noted that federal or state law provided redress for most, if not all, of Robbins’s alleged injuries. (For instance, Robbins could have sued for trespass, or appealed his license’s revocation.)

In this instance, the majority also envisaged considerable hurdles fashioning a cause of action since Robbins’s fundamental complaint was that the government “pushed too hard” in its easement related negotiations. The Court feared that divining a distinction between hard-nosed negotiation and harassment would ultimately work to hinder government officials and swamp courts with frivolous suits.

In a dissent, Justice Ginsburg disputed the majority’s characterization of BLM’s actions. BLM was not just acting as a landowner, but as a government body with incredible power over Robbins’s life. Additionally, Robbins’s other remedies -- a number of lengthy lawsuits in different forums -- would have been cost prohibitive and ineffective. In Ginsburg's view, a Bivens-like remedy was needed to deter the government from improperly wielding its immense power against small landowners.

Don't know about you, the only ranch we ever get near is on someone else's salad.

 

Posted by Lucas A. Ferrara, Esq. at 12:00 PM | Permalink | TrackBacks (0) | Comments (0)

Our friends Upstate have been keeping us posted on their efforts to secure changes to the law of "adverse possession." And, it appears that they may have achieved some measure of success.

Here's an e-mail I received last night from Aaron Robinson (who himself was the recipient of an unfavorable decision in an adverse possession case):

Dear Mr. Ferrara,

Just a quick note to let you know that both the New York State Senate and Assembly passed parallel bills to preclude a land claim by adverse possession when the claimant knows that another party owns the property. Based on the overwhelming support for this change (The Senate vote was 59 Yes / 2 No and the Assembly vote was unanimous!) it is obvious our lawmakers found the concept as appalling as did the victims.

Denise Pryzbylo of the famed 'Walling v. Pryzbylo' New York State Court of Appeals decision headed the charge of lobbying the lawmakers for the change, together with myself and another potential adverse possession victim. We didn't get the comprehensive changes we initially sought but the change we did get is a matter of ethics and partially closes the door to those unscrupulous people preying on innocent legitimate unsuspecting tax paying landowners. We just need the Governor's signature to make it the 'law of the land.'

Best Regards,

Aaron Robinson

A quick look at the New York State Senate's bill suggests that it may not be the panacea property owners were hoping for.

According to the proposed legislation, a person with "actual knowledge" that another holds "title" to property will be unable to assert an adverse possession claim to that parcel. Unfortunately, a key term -- "actual knowledge" -- is left undefined.

That ambiguity leaves us cause for concern since there may be a distinction which our friends and legislators have overlooked.

Courts may not view someone's "knowledge" or "general awareness" as comparable to having actual or constructive "notice" of another's property interest -- the latter being triggered by way of a publicly recorded document or deed.

In our opinion, "actual knowledge" continues to leave the standard too subjective. And, if nothing else, would appear to encourage a blind indifference to the truth. (After all, unless the facts in the property dispute are conceded, who is to say whether a claimant had "actual knowledge" of another's ownership rights?)

Is this a distinction with(out) a difference?

We're not a(d)verse to hearing your reactions.

------------------------------

A copy of the Senate Bill (S05364) follows:

2007-2008 Regular Sessions

IN  S E N A T E

April 25, 2007
 ___________

       Introduced  by  Sen.  LITTLE -- read twice and ordered printed, and when
       printed to be committed to the  Committee  on  Judiciary  --  reported
       favorably  from  said  committee,  ordered to first and second report,
       ordered to a third reading, amended and ordered  reprinted,  retaining
       its place in the order of third reading

       AN  ACT  to  amend  the  real  property  actions and proceedings law, in
       relation to adverse possession

       THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:

    1    Section  1.   Section 511 of the real property actions and proceedings
    2  law, as added by chapter 312 of the laws of 1962, is amended to read  as
    3  follows:
    4    S 511. Adverse possession under written instrument or judgment.  Where
    5  the  occupant  or  those  under  whom  he OR SHE claims entered into the
    6  possession of the premises under claim of title, exclusive of any  other
    7  right,  founding the claim upon a written instrument, as being a convey-
    8  ance of the premises in question, or upon the decree or  judgment  of  a
    9  competent   court,  and  there  has  been  a  continued  occupation  and
   10  possession of the premises included in the instrument, decree  or  judg-
   11  ment,  or  of  some  part  thereof, for ten years, under the same claim,
   12  WITHOUT HAVING ACQUIRED ACTUAL KNOWLEDGE THAT SUCH  CLAIM  OF  TITLE  IS
   13  INVALID  OR  VOID, the premises so included are deemed to have been held
   14  adversely; except that when they consist of a tract divided  into  lots,
   15  the possession of one lot is not deemed a possession of any other lot.
   16    S  2. Section 521 of the real property actions and proceedings law, as
   17  amended by chapter 116 of the laws  of  1965,  is  amended  to  read  as
   18  follows:
   19    S  521.  Adverse  possession  under  claim of title not written. Where
   20  there has been an actual continued occupation of premises under a  claim
   21  of  title,  exclusive of any other right, but not founded upon a written
   22  instrument or a judgment or decree, the premises  so  actually  occupied

EXPLANATION--Matter in ITALICS (underscored) is new; matter in bracket { } is old law to be omitted.
LBD10687-05-7

       S. 5364--A                          2

    1  FOR  TEN  YEARS,  and no others, are deemed to have been held adversely,
    2  EXCEPT TO THE EXTENT THAT THE CLAIMANT  HAS  ACQUIRED  ACTUAL  KNOWLEDGE
    3  THAT ANOTHER PERSON IS THE TITLE OWNER.
    4    S  3.  This  act  shall  take  effect  immediately  and shall apply to
    5  proceedings commenced on or after such date.

-----------------------------

For our other blog posts on this topic, please use this link: Adverse Possession

Posted by Lucas A. Ferrara, Esq. at 4:00 PM | Permalink | TrackBacks (0) | Comments (0)

Steven L. Ploski, doing business as Bellwether Company, sued Harry Langer and H. L. Langer & Company, Inc., for their failure to pay for Ploski's services.

There were a couple of problems with Ploski's case.

Ploski's contract and billing invoices reflected the name of a completely different corporate entity which (for some undisclosed reason) hadn't been made a party to the lawsuit. So, when the defendants moved to dismiss the case brought against them, that request was granted by the New York County Civil Court.

On appeal, the Appellate Term, First Department, affirmed and also indicated that Ploski's claim was time-barred by the governing "statute of limitations."

While the law will usually provide a remedy if you've been injured or harmed in a significant way, you don't have an open-ended time frame within which to seek relief. Contract disputes must be initiated in an appropriate judicial forum within six years of a party's breach. Failure to be proactive, could work to your detriment (as Ploski can attest).

Is Ploski v. Langer a legal bellwether?

(Not!)

For a copy of the Appellate Term's decision, please use this link: Ploski v. Langer

Posted by Jonathan H. Newman, Esq. at 8:25 AM | Permalink | TrackBacks (0) | Comments (0)

In Wuhu Import & Export Corp. v. Capstone Capital, LLC, a container of men's apparel shipped to the United States went unclaimed by the buyer due to the lack of financing. Capstone later agreed to buy a portion of those goods from Wuhu for the sum of $1,350,000.

In August of 2000, Capstone made a payment on account of $298,333.36, but withheld the balance when "substantial defects" with the merchandise were uncovered. In October of 2000, Wuhu agreed to reduce the sales price to $598,335.36 and applied the prior payment made to that latter amount.

When the $300,000 balance went unpaid, in June 2005, Wuhu filed suit against Capstone in New York County Supreme Court. Interestingly, the court boohooed Wuhu's efforts and dismissed the case, finding the claim time-barred by operation of a statute known as the Uniform Commercial Code (UCC).

The UCC governs "commercial" -- or "merchant to merchant" -- transactions and defines the rights and obligations of businesses faced with contract breaches, defective goods or services, the loss or destruction of goods (while in transit), and an array of other issues that typically arise in those kinds of deals, including (but not limited to) letters of credit and payment methods.

While a typical contract dispute must be filed with a court within six years of a violation or breach, a four-year period applies to commercial transactions governed by the UCC. [UCC 2-725(1)]. Since the Supreme Court "appropriately applied the four-year statute" to this case, the Appellate Division, First Department, affirmed the dismissal on appeal.

With that, Wuhu's case was zippered shut.

For a copy of the Appellate Division's decision, please use this link: Wuhu Import & Export Corp. v. Capstone Capital, LLC

Posted by Lucas A. Ferrara, Esq. at 12:00 PM | Permalink | TrackBacks (0) | Comments (0)

If you think landlord-tenant cases are wacky, try bringing a lawsuit against the State of New York. 

Kolnacki v. State of New York, a recent decision issued by the New York State Court of Appeals, illustrates just a few of the hurdles you can expect to encounter.

First, a little context. 

At common law, a state could act with impunity or reckless disregard of its duties or responsibilities because the doctrine of sovereign immunity shielded it from suits. Thus, someone injured by a state’s negligence was left without a legal remedy. (It’s great to be the king, ain’t it?)

Fortunately, New York State waived some of its immunity by way of a statute known as of the Court of Claims Act.* That law details the circumstances under which a claim may be brought and outlines what a plaintiff must do to successfully sue the State. For instance, in its pleadings a party must state the time and place of the accident, the nature of the claim, the injuries sustained, and the “total sum” of damages sought.

On July 8, 2000, Betty Kolnacki slipped and fell at Artpark, an outdoor theater/park in Western New York. Kolnacki sustained a knee fracture, damage to her teeth, and some cuts and bruises.  She later filed a negligence claim against New York State to recover monetary damages for her injuries. Kolnacki’s pleading did not, include a “total sum” of damages she was seeking to recover. Instead, her complaint indicated that the “[t]he full extent of claimant’s injuries are not yet known.”

While the Court of Claims found the State partially at fault, it still dismissed Kolnacki’s claim for violating Section 11(b) of the Court of Claims Act since her papers did not proffer the “total sum" of damages sought.

The Appellate Division, Fourth Department, overturned the dismissal, reasoning that since the damages were difficult for Kolnacki to determine, the stated language was sufficient. Our state’s highest court reversed the AD4 and dismissed the case.

The New York State Court of Appeals indicated that it would accept “nothing less than strict compliance with the jurisdictional requirements of the Court of Claims Act.” It described these requirements as “substantive conditions on the State’s waiver of sovereign immunity.” Should a plaintiff fail to comply, then the State remains immune and the Court of Claims “lacks jurisdiction” to hear the case.

Since the governing standards are immalleable, litigants are left with little choice but to estimate their damages and then amend their pleadings when the precise sums become known.

Excelsior?

For a copy of the Court of Appeal's decision, please use this link: Kolnacki v. State of New York

-----------------------------

*To access an electronic copy of the Court of Claims Act, select the statute identified with the initials CTC appearing toward the bottom of this list: New York State Laws

Posted by Lucas A. Ferrara, Esq. at 3:25 PM | Permalink | TrackBacks (0) | Comments (0)

Are you looking to avoid painful nicks and bumps?*  Then you better read the case of W 54-7 LLC v Schick.

Prior to Schick, landlords were able to argue that any defects in a predicate notice -- particularly as they related to service of that document -- were waived if not preserved in a tenant's responsive pleading or pre-answer motion to dismiss.

In this particular instance, the appellate court was of the opinion that the tenant's failure to preserve a defense relating to the legal sufficiency of a cure notice did not negate the landlord's eventual burden, at trial, to demonstrate that an appropriate predicate notice had issued in the holdover case.  As the AT noted in its decision:

Tenant's pre-trial motion to dismiss the holdover petition was properly granted, there being no serious dispute that landlord's service by mail of the 10-day notice to cure was untimely under the rule enunciated in Matter of ATM One, LLC v Landaverde, 2 NY3d 472 (2004). Compliance with statutory notice requirements represents a condition precedent to maintenance of a summary eviction proceeding (see 170 W. 85th St. Tenants Assn. v Cruz, 173 AD2d 338,339 [1991]), and the burden remains with the landlord to prove that element of its case at trial (see generally Siegel, New York Practice, § 215, at 353 [4th ed]). Thus, the tenant's failure to raise the notice issue in his initial dismissal motion or to plead it with specificity in his answer did not serve to relieve landlord of its trial burden to establish compliance with the Landaverde rule — a burden which, as indicated, landlord could not meet were this case to proceed to trial. Landlord's reliance on Priel v Priel (NYLJ, March 5, 1993, at 25, col 3 [App Term, lst Dept]) for the proposition that tenant waived the right to object to the untimely service of the cure notice, is misplaced, since that case was fully tried and a possessory judgment was issued before tenant sought to dismiss the petition via a post-trial motion to "reargue" based upon the absence of a predicate notice.

The outcome of this case is at odds with the prior appellate precedent which holds that objections pertaining to the adequacy or sufficiency of a "condition precedent" are waivable. 

How does one reconcile the outcome of this case?   Beats us!

What does one come away with from the decision?  To avoid getting marred, a landlord better get the elements of its case right, the first time.

For a copy of the Appellate Term's decision in W 54-7 LLC v Schick, please click on the following link: http://www.nycourts.gov/reporter/3dseries/2006/2006_26499.htm

*To be directed to (the other) Schick's website, please click on the following link: http://www.shaving.com/home.asp

Posted by Lucas A. Ferrara, Esq. at 8:25 AM | Permalink | TrackBacks (0) | Comments (0)

Wendnew LLC, was sued by its landlord -- The Gallery at Fulton Street, LLC -- for monetary damages arising from Wendnew's breach of its commercial lease. Within the context of a New York County Supreme Court case, the tenant disclaimed liability for $514,039.97 (some three years of rent being sought) since it had allegedly suffered a "constructive eviction" which annulled any obligation to remit payments.

Typically, a "constructive eviction" occurs when a landlord's "wrongful acts substantially and materially deprive the tenant of the beneficial use and enjoyment of the premises ... The tenant, however, must abandon possession in order to claim there was a constructive eviction." Barash v. Pennsylvania Terminal Real Estate Corp., 26 NY2d 77 (1970).

In this particular case, both the Supreme Court, and the Appellate Division, First Department, found a few problems with Wendnew's claim.

First, the tenant had an opportunity to raise the "constructive eviction" defense in a previously initiated summary nonpayment proceeding, but failed to do so. In fact, the tenant defaulted in that litigation -- that is, failed to appear in court to oppose the summary proceeding -- and a court-ordered eviction ensued. As a result, both the Supreme Court and the Appellate Division were of the opinion that this inaction prevented or "estopped" the tenant from raising the constructive-eviction defense in the Supreme Court case later filed by the landlord.

Second, since the tenant did not abandon the subject space (prior to the court-ordered eviction), its constructive-eviction defense was not supportable as a matter of law. As the appellate court observed:

The prior summary proceeding, wherein plaintiff's petition for possession was granted, necessarily decided that defendants remained in possession and plaintiff had properly terminated the lease. A default judgment in a summary proceeding for non-payment of rent is conclusive between the parties as to any facts alleged in the petition or affidavit that are required to be alleged as a basis for the proceeding ... Defendants' continued possession was such a fact, and negates their constructive eviction defense.

And, finally, although the landlord-tenant relationship had been terminated by the issuance of a warrant of eviction in the nonpayment case, neither that termination nor the language of the parties' agreement relieved the tenant of its continuing liability under the lease.

This particular case clearly demonstrates that turning a blind eye to legal papers one receives -- even within a nonpayment or holdover proceeding -- could have severe consequences and forever foreclose a litigant's ability to wend anew.

For a copy of the Appellate Division's decision in Gallery at Fulton St., LLC v. Wendnew LLC, please click on the following link:
http://www.nycourts.gov/reporter/3dseries/2006/2006_04773.htm

Posted by Daniel Finkelstein, Esq. at 8:25 AM | Permalink | TrackBacks (0) | Comments (0)

Anybody can sue you for anything, particularly if you let them. And, according to a recent appellate case, you can even be sued by a company that no longer exists.

In Security Pacific National Bank v. Evans, a defunct bank was permitted to maintain a foreclosure proceeding against a homeowner who had defaulted on a mortgage.

How is that possible, you ask?

Well, ultimately, it all boiled down to the fact that the homeowner failed -- within the context of the case -- to timely object to the bank's status and thereby forfeited the right to question the bank's ability to bring the case.

In 1988, Tracie Evans obtained a loan from First Nationwide Bank, secured by a home mortgage on her cooperative apartment. One year later, this mortgage was assigned to the Security Pacific National Bank (Security Pacific). In 1992, Security Pacific merged with Bank of America National Trust and Savings Association (Bank of America), and Security Pacific ceased operations. After the merger, Evans defaulted on her mortgage. For some unknown reason, the foreclosure proceedings against Evans were commenced in the New York County Supreme Court by the defunct bank (rather than Bank of America). And, on July 21, 1994, the court granted Security Pacific's motion for summary judgment and entered a judgment of foreclosure against Evans.

Apparently, Evans refused to vacate the unit and a holdover proceeding in the New York County Civil Court ensued. Eventually, by stipulation of settlement, dated November 19, 1998, Evans agreed to surrender possession on April 19, 1999. Rather than leave, as represented, Evans moved the Civil Court for an order vacating the agreement on the grounds that the bank lacked the requisite legal ability or "capacity" to maintain a court case against her. When the Civil Court disagreed, Evans returned to Supreme Court and reiterated the "capacity" argument in that forum where the court was of the opinion that the defense had been waived. And, on appeal, the Appellate Division, First Department, concurred. As the AD noted:

The record, however, demonstrates that Evans waived the defense of lack of capacity. The issue of lack of capacity does not implicate the jurisdiction of the court; it is merely a ground for dismissal if timely raised as a defense ... The statute is clear that the defense of lack of capacity must be raised in a pre-answer motion to dismiss or the answer, or else it will be waived ... Here, despite the fact that the merger preceded the commencement of this action, Evans never moved to dismiss based on lack of capacity and never included such defense in her answer. Instead, she first raised the defense four years later in a related holdover proceeding commenced by plaintiff. Based on these undisputed facts, the defense was waived and she is barred from raising it in this action.

In a dissent, two Justices of the Appellate Division were of the opinion that the bank's "defunct" status, deprived the court of "subject matter jurisdiction." As the dissenters observed:

The majority's contention that the Court has jurisdiction because New York Supreme Court is of original, unlimited and unqualified jurisdiction is irrelevant to a resolution of the dispute. While it is true that New York Supreme Court has subject matter jurisdiction over foreclosure brought pursuant to the RPAPL, it is not competent to hear a suit brought by a nonexistent party, foreclosure or not, because there is no aggrieved party and thus no genuine controversy. The court has no subject matter jurisdiction where there is no genuine controversy.

We believe the majority got it right and that "subject matter jurisdiction" was not truly in controversy. (After all, the Supreme Court has the power to hear foreclosure disputes.) The issue was whether Evans had timely objected to an entity's capacity to maintain a lawsuit against her -- a waivable defense. Once waived, a litigant should not be permitted to resurrect "lost" claims or defenses in the guise of a "subject matter jurisdiction" argument. (Such an outcome would render provisions of New York Civil Practice Law and Rules -- such as, CPLR 3211 -- meaningless and ineffective.)

Hopefully, if this case makes it to the state's highest court, the Court of Appeals will afford litigants (and their counsel) some procedural certainty and affirm the AD's decision.

For a copy of the Appellate Division's decision in Security Pacific National Bank v. Evans, please click on the following link:
http://www.nycourts.gov/reporter/3dseries/2006/2006_05721.htm

For our prior blog posts on "subject matter jurisdiction," please use the following links: Tenant Allowed to Challenge HPD's Decision in Housing Court, When Subject Matter Matters, Security Ain't Rent.

Posted by Daniel Finkelstein, Esq. at 8:25 AM | Permalink | TrackBacks (0) | Comments (0)

The powers of New York's various courts are defined by statute and our state's Constitution. And, in some instances, this authority is severely limited or circumscribed.

By way of example, a litigant filing a case in the New York City Civil Court may not assert a claim in excess of $25,000. (The exceptions are countersuits--or counterclaims--asserted in that forum, and proceedings brought in the Civil Court's Landlord-Tenant Parts. No dollar limitations apply in those instances and the sums sought to be recovered may be of any amount.)

When a dispute exceeds the monetary ceiling, the court is without "subject matter jurisdiction" to entertain the dispute and the matter must either be dismissed (without prejudice to the refiling of the dispute in the appropriate forum) or transferred to the correct courthouse.

In 1443 York Avenue Realty Co. v. Ronning, landlord 1443 York Avenue Realty Company sued Nancy Ronning, the guarantor of a residential lease, for monies due under that agreement. Ms. Ronning and her daughers--who were the named tenants--commenced a separate lawsuit against the owner, seeking damages for rent overcharge; a claim, when tripled, totaled $75,000.

While the facts are somewhat complicated--in that two cases were eventually combined or consolidated "for all purposes"--of import to our analysis is that the consolidation did not enable the Ronnings to maintain their $75,000 claim in the Civil Court. As the Appellate Term, First Department, observed:

A demand for treble damages, much like a demand for punitive damages, is parasitic in nature and does not constitute a separate cause of action distinct from the substantive cause upon which it is grounded ... Inasmuch as the rent overcharge complaint pleaded not separate, distinct claims, but a single cause of action in excess of the court's $25,000 monetary ceiling...the court was without subject matter jurisdiction over the matter ... In such circumstances, the proper course was to transfer the consolidated actions to Supreme Court pursuant to Article VI, Section 19(f) of the New York State Constitution ....

Thus, according to the AT, the Civil Court may neither play host to costly parasitic claims nor permit litigants to impermissibly leech that forum's judicial resources.

For a copy of the Appellate Term's decision in 1443 York Avenue Realty Co. v. Ronning, please click on the following link:
http://www.nycourts.gov/reporter/3dseries/2006/2006_51401.htm

For a copy of the New York State Constitution, please click on the following link:
http://www.dos.state.ny.us/info/pdfs/cons2004.pdf

Posted by Lucas A. Ferrara, Esq. at 8:25 AM | Permalink | TrackBacks (0) | Comments (0)

Few appreciate the technical hurdles that await those who wish to sue a municipality like the City of New York (or one of its related entities). Before a lawsuit may be brought, the party seeking to sue must first file a "Notice of Claim"--a sworn, written document which outlines each injured individual's name and address, counsel's name and address, the factual particulars (date, time, place, and manner of injury), and the requested relief. And, you have only ninety (90) days--typically measured from when the loss or injury is incurred--to file that special notice. The theory behind this expedited, advance-notice requirement is to allow the City an opportunity to investigate the claim while the incident is relatively recent and the pertinent information and evidence are still readily available and accessible to the municipality.

Because it is an absolute precondition to a case's commencement, many refer to the Notice of Claim as a "condition precedent"--something that must first occur or the lawsuit may be dismissed. [For example, with respect to claims filed against the City of New York, a law known as the General Municipal Law (GML) governs the process. And that's where you will find that 90-day filing requisite. GML section 50(e)(1)(a).]

While the law typically excuses inconsequential errors or omissions in the Notice, failing to properly serve the document or to ensure its timely filing may be fatal. And, while there are appellate cases allowing Notices to be filed "late"--outside of the 90-day window--they should be viewed as the exceptions rather than the norm.

Some of the grounds which may excuse a late filing include:

death;

infancy;

mental or physical incapacity;

reasonable reliance on settlement representations (made by the municipality or an insurer); and

excusable error regarding the name of the public corporation.

Be forewarned: This analysis is not exhaustive. As a result, readers are encouraged to consult with counsel to confirm whether or not the criteria and timeframes discussed in this blog post apply to their particular case.

A case which reinforces the harsh realities of this area of the law is Astree v. New York City Transit Authority, (NYCTA). While the Queens County Supreme Court granted Ms. Astree's request to serve a late Notice of Claim, on appeal, the Appellate Division, Second Department, summarily discounted Astree's excuses--which included her inability to speak English, law office failure, and her lack of familiarity with the law's notice of claim requirements--and reversed the lower court's order, citing "prejudice" to the NYCTA as a result of the agency's inability to conduct a "prompt investigation" and "maintain a defense."

A bit draconian, wouldn't you agree?

For a copy of the Appellate Division's decision in Astree v. New York City Transit Authority, please click on the following link:
http://www.nycourts.gov/reporter/3dseries/2006/2006_05736.htm

Posted by Lucas A. Ferrara, Esq. at 8:25 AM | Permalink | TrackBacks (0) | Comments (0)

Once an administrative agency issues a determination, a party will usually have an opportunity to appeal that decision by way of an internal review process. Once those steps have been exhausted, if one remains dissatisfied with the end result, that outcome may then be challenged by way of a special court case, known as an "Article 78" proceeding. Typically, in landlord-tenant and real-estate related disputes, such lawsuits are filed with the supreme court in the county in which the property is situated. If that administrative appeal is not timely brought, (or if the court challenge is unsuccessful), the agency's determination is accorded considerable deference and will be honored and enforced by the courts.

In Westwood Houses, Inc. v. Hayes, the New York City Department of Housing Preservation and Development (HPD) denied Keith Hayes's succession claim to a Mitchell-Lama apartment. Although Mr. Hayes timely filed an Article 78 proceeding, the New York County Supreme Court dismissed his case on the basis that the "Civil Court is the proper forum for the landlord and tenant dispute." (Apparently, the Supreme Court punted.)

When Westwood subsequently commenced its eviction proceeding against Hayes, the Housing Court judge refused to entertain Hayes's succession claim presumptively since the Civil Court is not an appropriate forum within which to review HPD's decision. On appeal, the Appellate Term, First Department, reversed, finding that since Mr. Hayes had been denied a "meaningful review" of his claim, and "the Supreme Court had expressly deferred the succession issue to Civil Court," Hayes was entitled to his day in court and should have been allowed to assert his succession claim as a defense to the landlord's holdover case.

This case raises a number of disturbing questions and concerns. First, it is unresolved whether Mr. Hayes filed an appeal from the Supreme Court's order dismissing his Article 78 proceeding. Clearly, an appeal to the Appellate Division would have been the appropriate procedural course to address the Supreme Court's error. But, if Hayes opted not to do so, he was arguably precluded from seeking further relief in any forum, including the Civil Court.

Since the Civil Court is a court of limited jurisdiction, it lacks the authority to annul or modify administrative determinations. Thus, not only are we are troubled by the Supreme Court's "punt," but we question the attempt to confer power upon a lower court divested of the requisite statutory authority to review (or modify) an agency's decision. The governing statute only confers the power on the "supreme court" to adjudicate Article 78 proceedings.

While the judges of the Appellate Term were clearly attempting to do the "right thing," and fashion a creative remedy to some pretty unfortunate facts and circumstances, we respectfully submit that, this time, they got it wrong. As we have previously observed, "subject matter jurisdiction" can not be capriciously conferred upon a court, not even by an appellate court.

For a copy of the Court's decision in Westwood Houses, Inc. v. Hayes, please click on the following link:
http://www.courts.state.ny.us/reporter/3dseries/2006/2006_50928.htm

Posted by Lucas A. Ferrara, Esq. at 8:25 AM | Permalink | TrackBacks (0) | Comments (4)

Normally, we don't know when our time is up. But, the law does afford us some degree of certainty.

When someone is injured in an accident or otherwise suffers damage or loss, there is a limited period of time within which a lawsuit may brought. These timeframes (known as "statutes of limitations") are stringently enforced and vary based on the nature of the claim.

By way of example, in New York State, you have only one (1) year to bring a claim for "assault, battery, false imprisonment, malicious prosecution, libel, and slander." (CPLR section 215) With certain exceptions, an action based on "medical, dental or podiatric malpractice" must be commenced within two years and six months. (CPLR section 214-a). A person typically has three (3) years from an injury's incurrence or discovery to seek judicial intervention. (CPLR section 214). A residential rent-overcharge complaint must be filed within four (4) years of the alleged overcharge. (CPLR section 213-a) And, you have six (6) years to sue for breach of contract. [Be forewarned:This list is not exhaustive. Readers are strongly encouraged to consult with counsel to determine if the governing time parameters (and any applicable exceptions) apply to the facts of their particular dispute.]

If relief is not timely sought, the claim may be forever lost or time-barred. As a result, the people who are alleged to have caused the injury or loss (and who are defendants in a lawsuit) will frequently argue that the case should have been brought earlier, thereby relieving them of liability.

This kind of bandy occurred in Barrell v. Glen Oaks Village Owners, Inc, wherein the plaintiffs claimed to have been injured as a result of the negligent installation of a hot-water hose connected to a washing machine installed in the plaintiffs' apartment unit. The plumbing company responded by asserting that since the work had been performed over three years prior to the incident, the case was barred by the governing three-year statute of limitations. In response to motion practice, the Queens County Supreme Court refused to strike the plumbing company's defense. On appeal, the Appellate Division, Second Department, reversed noting that the clock had started to tick from the date of the injury, not from when the work had been performed.

As the Appellate Division observed:

As a general rule "a cause of action for personal injuries, whether sounding in negligence, malpractice, or products liability, accrues at the time of injury"..."Stated another way, accrual occurs when the claim becomes enforceable, i.e., when all elements of the tort can be truthfully alleged in a complaint"...The plaintiffs seek to recover damages for personal injuries sustained by the injured plaintiff when a hose supplying hot water to a washing machine in the plaintiffs' apartment burst. Contrary to the conclusion reached by the Supreme Court, the plaintiffs' claim against the defendant plumbing company for negligent installation of the washing machine and attendant plumbing accrued on the date the injury was sustained, and not on the date the work was performed...Accordingly, the plaintiffs' claim against the plumbing company to recover damages based on negligence is not barred by the applicable three-year statute of limitations (see CPLR 214).

No point plumbing any further into this case.

For a copy of the Appellate Division's decision in Barrell v. Glen Oaks Village Owners, Inc., please click on the following link:
http://www.nycourts.gov/reporter/3dseries/2006/2006_03704.htm

Posted by Jonathan H. Newman, Esq. at 8:25 AM | Permalink | TrackBacks (0) | Comments (0)