In S* H*, Inc. v. P*, the Appellate Term, Second Department, addressed a dispute arising from a holdover summary proceeding in which the petitioner sought possession of a property from L & D. P*, along with unnamed undertenants. The case took a procedural turn when the occupants moved to dismiss the petition, arguing that the matter was barred by "res judicata" due to a prior dismissal of a similar proceeding. The petitioner countered that the earlier dismissal had been "without prejudice" and therefore did not preclude the current case.
After a brief adjournment, the occupants withdrew their motion to dismiss. However, S* H*, Inc. then moved for sanctions against both the occupants and their attorney, claiming that the motion to dismiss had been frivolous and intended to delay the litigation. The Civil Court denied the request for sanctions, and the landlord appealed that portion of the order.
On its review, the AT2 examined the dispute under the framework of 22 NYCRR § 130-1.1, which allows courts to impose financial sanctions for frivolous conduct. Conduct is considered frivolous if it either lacks merit in law or fact and cannot be supported by a reasonable legal argument, or is undertaken primarily to delay or prolong litigation.
Although the appellate court acknowledged that the occupants’ motion lacked merit, it emphasized that the motion had been withdrawn promptly after a short adjournment. Furthermore, the Civil Court had already cautioned counsel against similar conduct in the future. Given these circumstances, the AT2 concluded that the trial court had not abused its discretion in denying the request for sanctions.
This decision highlights the court’s measured approach to sanctioning parties for procedural missteps. Even when a motion is weak or unfounded, the court may decline to impose penalties if the conduct is corrected quickly and does not significantly disrupt the proceedings. The ruling reinforces the principle that sanctions are reserved for truly egregious or obstructive behavior, not merely for unsuccessful legal arguments.
Sanction request: the legal version of “nice try."
# # #
DECISION