Benson Realty Corp. v. Walsh, 50 N.Y.2d 418 (1980)

When a motion is transferred to the Albany Supreme Court as an Article 78 proceeding, the underlying action is not necessarily transferred, and dismissing the complaint in the original action based on the Article 78 proceeding’s outcome is an error if the original action is still pending.

Summary

Benson Realty Corp. initially filed an action in New York County Supreme Court, which was then converted into an Article 78 proceeding and transferred to Albany County Supreme Court. The Appellate Division, reviewing the Albany County decision, dismissed the original New York County complaint. The Court of Appeals held this was an error because the transfer only pertained to the motion converted to an Article 78 proceeding, not the entire underlying action. The Court of Appeals modified the order to remove the dismissal of the complaint, clarifying that the plaintiff could still pursue the original action if it was pending.

Facts

Benson Realty Corp. commenced an action in New York County Supreme Court. During the proceedings, a motion was made that the court determined was more appropriately addressed via an Article 78 proceeding. The New York County Supreme Court then transferred the motion, framed as an Article 78 proceeding, to the Albany County Supreme Court.

Procedural History

1. Action commenced in New York County Supreme Court.
2. Motion converted to Article 78 proceeding and transferred to Albany County Supreme Court.
3. Appellate Division reviewed the Albany County judgment and dismissed the original New York County complaint.
4. Court of Appeals modified the Appellate Division’s order, reinstating the possibility of pursuing the original action.

Issue(s)

1. Whether the transfer of a motion, reframed as an Article 78 proceeding, from one Supreme Court to another (New York County to Albany County) also transfers the underlying action.
2. Whether it is appropriate for an appellate court reviewing a judgment in an Article 78 proceeding to dismiss the complaint in the original action when the record does not definitively establish the status of the original action.

Holding

1. No, because the transfer only pertained to the motion converted to an Article 78 proceeding, not the entire underlying action.
2. No, because dismissing the complaint in the original action is an error if the original action is still pending, as the record did not clearly indicate its status.

Court’s Reasoning

The Court of Appeals focused on the limited nature of the transfer. The New York County Supreme Court only transferred the motion, which it recharacterized as an Article 78 proceeding. This transfer did not automatically include the entire underlying action. The Court emphasized that the record failed to show whether the original New York County action was still pending. Consequently, the Appellate Division erred in dismissing the complaint in that action based solely on the outcome of the Article 78 proceeding. The Court modified the Appellate Division’s order to remove the dismissal, allowing Benson Realty Corp. to pursue the original action if it remained active. The amendment to the remittitur further clarified that the dismissal was “without prejudice to plaintiff raising the issues sought to be litigated in the article 78 proceeding in such other litigation as plaintiff may be advised to pursue, including, if it be still pending, the action originally brought in New York County.” This highlights the importance of accurately determining the scope of a transfer between courts and the potential prejudice to a litigant if a pending action is dismissed without proper justification. This case serves as a cautionary tale against assuming the transfer of an entire action based on the transfer of a related motion.