Perez v. Paramount Communications, Inc., 92 N.Y.2d 749 (1999)
Under New York’s commencement-by-filing system, the Statute of Limitations is tolled when a plaintiff files a motion for leave to amend a complaint to add a defendant, attaching the proposed supplemental summons and amended complaint, until the court rules on the motion.
Summary
Plaintiff Carlos Perez sued Paramount Communications for negligence, alleging injuries from a construction accident at Madison Square Garden. Discovering that Madison Square Garden, L.P. (MSG) actually owned the premises, Perez moved to amend his complaint to add MSG as a defendant, including a copy of the proposed supplemental summons and amended complaint. The motion was filed before the Statute of Limitations expired, but the court’s order granting leave to amend came after. The New York Court of Appeals held that filing the motion to amend tolled the Statute of Limitations until the order granting the amendment was entered, making the action against MSG timely. This decision harmonizes New York law with federal practice and promotes judicial economy.
Facts
Carlos Perez was injured on November 20, 1990, while working on a scaffold during renovations at Madison Square Garden. On November 27, 1992, Perez sued Paramount Communications, Inc., believing them to be the owner/operator of Madison Square Garden. During discovery, Perez learned that Madison Square Garden, L.P. (MSG) owned the premises and that Herbert/HRH Construction were the general contractors. On June 16, 1993, Perez moved to amend the complaint to add MSG as a defendant, attaching the proposed supplemental summons and amended complaint. The motion was filed with the court and copies were mailed to Paramount. The order granting the amendment was entered on November 3, 1993, after the Statute of Limitations would have expired. The supplemental summons and complaint were served on November 1, 1993, and filed with proof of service on December 2, 1993.
Procedural History
Perez filed a separate action against Herbert/HRH Construction on November 29, 1993, and successfully moved to consolidate the cases. All defendants moved to dismiss. Paramount’s motion was granted because they did not own or operate MSG. Herbert/HRH’s motion was granted based on the Statute of Limitations. The Supreme Court initially found the claim against MSG untimely but held that MSG and Paramount were united in interest, thus making the claim timely. The Appellate Division affirmed, disagreeing on the united-in-interest point but finding the claim timely because the motion to amend was filed before the Statute of Limitations expired. The Court of Appeals granted leave to appeal.
Issue(s)
- Whether the filing of a motion for leave to amend the complaint to add a defendant to a pending action, including a copy of the proposed supplemental summons and amended complaint, tolls the Statute of Limitations as against the party sought to be added until the court rules on the motion.
Holding
- Yes, because under New York’s commencement-by-filing system, the filing of the motion tolls the Statute of Limitations until the court rules on the motion to amend.
Court’s Reasoning
The Court of Appeals overruled its prior precedent in Arnold v Mayal Realty Co., which held that service of motion papers alone was insufficient to stop the Statute of Limitations. The court reasoned that under the modern commencement-by-filing system, requiring a party to wait for a court’s decision before the Statute of Limitations is tolled would be unjust. The court adopted a rule that filing a motion for leave to amend, accompanied by the proposed supplemental summons and amended complaint, tolls the Statute of Limitations until the court rules on the motion. This approach aligns with federal practice and the policies of judicial economy and preventing a multiplicity of suits, as well as being consistent with the holdings in Matter of Fry v Village of Tarrytown and Matter of Gershel v Porr. The court stated that “Statutes of Limitation are designed to promote justice by preventing prejudice through the revival of stale claims…That goal would not be served by a rule which would render the timeliness of a claim dependent upon the speed with which a court decides a motion.”