New York Law Review

Tag: 2014

  • Matter of French Oaks Condominium v. Town of Amherst, 23 N.Y.3d 170 (2014): Rebutting Presumption of Validity in Property Tax Assessment

    Matter of French Oaks Condominium v. Town of Amherst, 23 N.Y.3d 170 (2014)

    A taxpayer challenging a property tax assessment must present substantial evidence, based on sound theory and objective data, to rebut the presumption of validity that attaches to the taxing authority’s valuation.

    Summary

    The French Oaks Condominium challenged the Town of Amherst’s property tax assessment, arguing it was excessive. The Board’s appraiser used an income capitalization method but relied on “forecast financials” for comparable properties without providing verifiable data. The referee accepted the Board’s capitalization rate, but the Court of Appeals reversed, holding that the Board failed to rebut the presumption of validity because its appraiser’s capitalization rate lacked objective support. This case underscores the need for appraisals to be supported by verifiable data and not merely the appraiser’s personal knowledge.

    Facts

    The French Oaks Condominium, a 39-unit residential complex, was assessed at $5,176,000 by the Town of Amherst for the 2009-2010 tax year. The Condominium’s Board of Managers initiated a Real Property Tax Law (RPTL) article 7 proceeding, claiming the assessment was too high. Their appraisal report valued the property at $4,265,000, using an income capitalization method, treating the units as rental properties. The appraiser identified four comparable apartment complexes to determine a capitalization rate but relied on “forecast financials” for income and expenses, lacking verifiable documentation.

    Procedural History

    The Board initiated an RPTL article 7 proceeding. A referee held a hearing and initially denied the Town’s motion to dismiss, finding the Board rebutted the presumption of validity. Supreme Court ordered the Town to amend its tax roll. The Appellate Division affirmed. Two justices dissented. The Town appealed to the New York Court of Appeals based on the two-justice dissent.

    Issue(s)

    Whether the Board presented substantial evidence to rebut the presumption of validity that attaches to the Town’s property tax assessment.

    Holding

    No, because the Board’s appraisal, specifically the capitalization rate derived from comparable properties, lacked sufficient objective data to substantiate the appraiser’s calculations, and therefore failed to rebut the presumption of validity.

    Court’s Reasoning

    The Court emphasized that a property tax assessment carries a presumption of validity, and the taxpayer bears the initial burden of presenting substantial evidence of overvaluation. This evidence must demonstrate a valid and credible dispute regarding valuation and be based on sound theory and objective data. The court cited 22 NYCRR 202.59(g)(2), requiring appraisals to include facts, figures, and calculations supporting the appraiser’s conclusions, set forth with sufficient particularity. The Court found that the Board’s appraiser failed to provide verifiable data for the income and expense figures used to calculate the capitalization rate. The appraiser’s reliance on “forecast financials” and “personal exposure” without supporting documentation was insufficient. The Court stated: “[A]n appraiser cannot simply list financial figures of comparable properties in his or her appraisal report that are derived from alleged personal knowledge; he or she must subsequently ‘prove’ those figures to be facts at trial.” Because the capitalization rate was not adequately supported, the Board failed to rebut the presumption that the tax assessment was valid. The court emphasized that while the substantial evidence standard is not a heavy one, “the documentary and testimonial evidence proffered by petitioner [must be] based on sound theory and objective data”.

  • People v. Sibblies, 22 N.Y.3d 1174 (2014): Limits on Excluding Time After Off-Calendar Readiness Declaration

    People v. Sibblies, 22 N.Y.3d 1174 (2014)

    When the prosecution declares readiness for trial off-calendar but then declares unreadiness at the next court appearance, the intervening time is not excluded from the speedy trial period unless the unreadiness stems from exceptional circumstances arising after the initial declaration.

    Summary

    Defendant was arrested and charged with felony and misdemeanor offenses. After the felony charge was dismissed and replaced with a misdemeanor information, the People filed an off-calendar certificate of readiness. At the next court appearance, the People stated they were not ready due to awaiting medical records. The Court of Appeals held that the time between the off-calendar declaration of readiness and the subsequent declaration of unreadiness is chargeable to the People unless their unreadiness is caused by exceptional circumstances that arose after the initial declaration of readiness. The court reversed the Appellate Division order and dismissed the misdemeanor information.

    Facts

    Marsha Sibblies was arrested on November 27, 2006, and charged with felony and misdemeanor offenses stemming from an altercation during a traffic stop.

    On February 8, 2007, the People dismissed the felony charge and replaced it with a misdemeanor information, which started the 90-day speedy trial period.

    On February 22, 2007, the People filed an off-calendar certificate of readiness and a supporting deposition.

    On March 2, 2007, the People requested the injured officer’s medical records.

    On March 28, 2007, the People stated they were not ready because they were awaiting the officer’s medical records.

    The People filed a second certificate of readiness on May 23, 2007, 104 days after the speedy trial period began.

    Procedural History

    The Supreme Court denied the defendant’s motion to dismiss the misdemeanor information, excluding the time between the People’s declaration of readiness and the March 28 appearance from the 104-day period.

    The defendant was convicted of obstructing governmental administration and resisting arrest, but acquitted of assault.

    The Appellate Division affirmed, holding the People were ready on February 22, 2007, because they could have made a prima facie case without the medical records.

    The Court of Appeals granted the defendant leave to appeal.

    Issue(s)

    Whether the period between the People’s off-calendar declaration of readiness and their subsequent statement of unreadiness at the next court appearance should be excluded from the speedy trial period under CPL 30.30 when the unreadiness is not due to exceptional circumstances arising after the initial declaration.

    Holding

    No, because such a period of prosecutorial readiness may not be excluded from the speedy trial period unless the People’s unreadiness is occasioned by an exceptional fact or circumstance that arose after the declaration of readiness.

    Court’s Reasoning

    The Court reasoned that CPL 30.30 obligates the People to prepare promptly for trial. To be ready, the People must declare readiness and be in fact ready to proceed. An off-calendar certificate of readiness allows the People to declare readiness even if the statutory period expires before the next court date. However, readiness requires more than simply “mouthing” the words. The inquiry is whether the People have done all that is required of them to bring the case to a point where it may be tried.

    The Court emphasized that if the People are not ready at the court appearance, the defendant cannot ask the court to set the matter for trial, rendering the readiness ineffective and potentially harmful to the defendant by delaying the running of the statutory period. CPL 30.30 demands prosecutorial readiness to reduce delays in criminal prosecutions.

    The Court held that if challenged, the People must demonstrate that some exceptional fact or circumstance arose after their declaration of readiness so as to render them presently not ready for trial. The requirement of an exceptional fact or circumstance should be the same as that contained in CPL 30.30 (3) (b), which preserves the readiness period when “some exceptional fact or circumstance,’ [including, but not limited to, the sudden unavailability of evidence material to the People’s case,] occurring after the initial readiness response, makes it impossible for the People to proceed” (People v. Anderson, 66 NY2d at 534, quoting CPL 30.30 [3] [b]). If the People cannot demonstrate an exceptional fact or circumstance, then the time between the filing and the following appearance cannot be excluded.

    In this case, the People’s unreadiness was not due to the type of “exceptional fact or circumstance” contemplated by CPL 30.30 (3) (b). It was not occasioned by, for example, the sudden unavailability of a material witness or material evidence, merely the People’s desire to strengthen their case. The 34-day period from the People’s off-calendar declaration of readiness to their in-court statement of unreadiness is chargeable to the People, thus exceeding the 90-day statutory period.

    The Court noted that allowing declarations of readiness off-calendar and subsequent declarations of unreadiness at the next appearance without scrutiny creates the possibility that this scenario could be reenacted ad seriatim, which would undermine the purpose of CPL 30.30 to expedite trials. As Chief Judge Lippman stated, “CPL 30.30 is not a mechanism for filibustering trials.”

  • Palladino v. CNY Centro, Inc., 23 N.Y.3d 140 (2014): Continued Adherence to the Martin v. Curran Rule for Suits Against Unions

    23 N.Y.3d 140 (2014)

    New York adheres to the rule established in Martin v. Curran, requiring a plaintiff suing an unincorporated association (like a union) to demonstrate that every single member of the association authorized or ratified the conduct giving rise to the cause of action.

    Summary

    Eugene Palladino, a bus driver, sued his union, Amalgamated Transit Union, Local 580, alleging a breach of the duty of fair representation after he was terminated. The Appellate Division dismissed the complaint, citing Martin v. Curran, because Palladino failed to allege that every union member ratified the union’s conduct. The Court of Appeals affirmed, declining to overrule Martin, emphasizing the principle of stare decisis and the Legislature’s role in modifying existing statutory interpretations. The court acknowledged criticisms of the Martin rule, but ultimately deferred to the legislature to determine whether to change the requirements for suing unincorporated associations.

    Facts

    Eugene Palladino, a bus driver for CNY Centro, Inc. (Centro), was a member of Amalgamated Transit Union, Local 580 (the Union). Centro terminated Palladino for incidents in 2007 and 2008, including allegedly misrepresenting his whereabouts and actions. The Union initially filed grievances on Palladino’s behalf, but later withdrew them based on Palladino’s lack of cooperation. Palladino did not accept a settlement agreement negotiated by the Union regarding the second incident, which ultimately led to his termination. Palladino claimed that his termination occurred just before he would have become eligible for early retirement and lifetime health insurance benefits.

    Procedural History

    Palladino filed two separate actions against Centro and the Union, which were consolidated. Supreme Court denied the Union’s motion for summary judgment on the breach of duty of fair representation claim. The Appellate Division reversed, finding Palladino’s claim “fatally defective” under Martin v. Curran. Palladino appealed to the New York Court of Appeals.

    Issue(s)

    Whether the rule in Martin v. Curran, requiring proof that every member of an unincorporated association authorized or ratified the conduct giving rise to the cause of action, applies to a union member’s suit against the union for breach of the duty of fair representation, and whether the Court of Appeals should overrule Martin v. Curran.

    Holding

    No, because the rule in Martin v. Curran applies, and the Court declines to overrule its precedent, emphasizing the principles of stare decisis and the role of the legislature in modifying statutory interpretations.

    Court’s Reasoning

    The Court reaffirmed the Martin v. Curran rule, which treats unincorporated associations, including labor unions, as aggregates of individual members. Under this rule, a plaintiff must prove that each member of the union authorized or ratified the allegedly wrongful conduct to hold the union liable. The Court acknowledged criticisms of the Martin rule, noting that it has been described as an “onerous and almost insurmountable burden” for plaintiffs suing unions. The Court distinguished the present case from Madden v. Atkins, where an exception to the Martin rule was created for wrongful expulsion cases involving a vote by the membership.

    The Court emphasized the importance of stare decisis, particularly in cases involving statutory interpretation. General Associations Law § 13, which governs actions against unincorporated associations, was interpreted in Martin to limit suits against association officers to cases where the individual liability of every single member can be alleged and proven. The Court noted that since the Martin decision, the legislature has not acted to correct or clarify that interpretation. The Court stated that while it was willing to overrule precedent involving statutory interpretation, it did not believe that it was best course of action here. It argued that the legislature is best suited to address the policy concerns and to limit the applicability of any new rule removing or amending the requirements for maintaining an action against unincorporated associations. The Court stated that “the Legislature has limited . . . suits against association officers, whether for breaches of agreements or for tortious wrongs, to cases where the individual liability of every single member can be alleged and proven.”

    The court also observed that public employees in New York have an alternative remedy: they can bring an improper practice charge before the New York State Public Employment Relations Board pursuant to the Taylor Law (Civil Service Law § 200 et seq.).

  • Mashreqbank PSC v. Ahmed Hamad Al Gosaibi & Bros. Co., 23 N.Y.3d 131 (2014): Forum Non Conveniens and International Transactions

    Mashreqbank PSC v. Ahmed Hamad Al Gosaibi & Bros. Co., 23 N.Y.3d 131 (2014)

    The mere passage of funds through New York banks in an international transaction, without other significant connections to New York, does not automatically create a compelling state interest sufficient to preclude dismissal on forum non conveniens grounds.

    Summary

    Mashreqbank, located in Dubai, sued AHAB, a Saudi Arabian partnership, in New York to recover funds from a foreign exchange swap transaction. AHAB filed a third-party complaint against Al-Sanea, alleging fraud. Al-Sanea moved to dismiss based on forum non conveniens. The Supreme Court dismissed both the complaint and third-party complaint. The Appellate Division reversed, finding the dismissal improper without a formal motion and emphasizing New York’s interest in protecting its banking system. The Court of Appeals reversed, holding that while a formal motion is generally required, the lack of one here was not fatal given the full opportunity to argue the issue, and the case lacked sufficient connection to New York to justify the forum.

    Facts

    Mashreqbank (Mashreq), a bank in Dubai, agreed to a foreign exchange swap transaction with Ahmed Hamad Al Gosaibi & Brothers Company (AHAB), a Saudi Arabian partnership. Mashreq transferred $150 million to AHAB’s account at Bank of America in New York. AHAB allegedly failed to pay Mashreq the equivalent value in Saudi Arabian riyals as agreed. AHAB alleged that Al-Sanea, an employee, engaged in a scheme to loot AHAB, and that Mashreq aided this fraud. The $150 million was transferred from Bank of America to Awal Bank’s account at a New York bank.

    Procedural History

    Mashreq sued AHAB in New York Supreme Court. AHAB filed an answer and a third-party complaint against Al-Sanea and Awal Bank. Al-Sanea moved to dismiss the third-party complaint based on forum non conveniens. The Supreme Court, sua sponte, raised the issue of dismissing the entire case on forum non conveniens grounds and directed briefing on the issue. The Supreme Court dismissed both the complaint and the third-party complaint. The Appellate Division reversed, holding that dismissal of the main action was improper without a formal motion and that the third-party complaint should not have been dismissed. The Court of Appeals reversed the Appellate Division, reinstating the Supreme Court’s dismissal.

    Issue(s)

    1. Whether a court can dismiss a complaint on forum non conveniens grounds when no formal motion for such dismissal has been made by a party?

    2. Whether the use of New York banks for fund transfers in an international transaction, standing alone, is sufficient to preclude dismissal on forum non conveniens grounds?

    3. Whether New York law should apply to a claim by a Saudi Arabian company against a Saudi citizen for fraudulent acts allegedly committed in Saudi Arabia?

    Holding

    1. No, not necessarily, because CPLR 327(a) requires a motion from a party, but where the issue is fully briefed and argued without objection and no prejudice results from the lack of a formal motion, the dismissal is not barred.

    2. No, because New York’s interest in the integrity of its banks is not significantly threatened every time one foreign national moves dollars through a bank in New York effecting a transaction that is allegedly fraudulent.

    3. No, because Saudi Arabia is the domicile and residence of both parties and the place where the allegedly tortious conduct occurred, giving it the greatest interest in resolving the issues.

    Court’s Reasoning

    The Court of Appeals distinguished its prior holding in VSL Corp. v. Dunes Hotels & Casinos, emphasizing that in VSL, the forum non conveniens issue was raised sua sponte by the Appellate Division without any party addressing it. In this case, while no formal motion was made regarding the main complaint, the issue was fully briefed and argued. The court reasoned that CPLR 327(a)’s requirement of a “motion” should not be interpreted to prohibit a dismissal where only the formality of a “notice of motion” was lacking and where the opposing party was neither prejudiced nor objected to the omission.

    The court rejected the Appellate Division’s reliance on J. Zeevi & Sons v. Grindlays Bank (Uganda), stating that merely using New York banks for dollar transfers does not automatically implicate New York’s compelling interest in protecting its banking system. The court stated that New York’s interest in its banking system “is not a trump to be played whenever a party to such a transaction seeks to use our courts for a lawsuit with little or no apparent contact with New York.” The court emphasized that Zeevi was a choice of law case, not a forum non conveniens case, and its holding was based on the fact that the repudiation of the obligation occurred in New York.

    The court found that New York law should not apply to AHAB’s claims against Al-Sanea. Applying New York’s “interest analysis” approach, the court concluded that Saudi Arabia has the greatest interest in resolving the issues, as both parties are domiciled there, and the allegedly tortious conduct occurred there.

    The court determined that dismissal on forum non conveniens grounds was required as a matter of law due to the lack of any significant connection to New York. “Apart from the use of New York banks to facilitate dollar transfers — a fact which, as we have said, is of minor importance here — we see nothing in this case to justify resort to a New York forum.” The court noted the availability of alternative forums and the pendency of related litigations in other countries, making New York an inappropriate forum.

  • People v. Rivera, 23 N.Y.3d 112 (2014): Jury Instructions on Lesser Included Offenses

    23 N.Y.3d 112 (2014)

    A trial court is not required to submit a charge of reckless manslaughter (second-degree) as a lesser included offense of intentional homicide (e.g., second-degree murder) unless there is a reasonable view of the evidence to support a finding that the defendant acted recklessly, meaning the record doesn’t automatically require a reckless manslaughter charge even if it doesn’t completely exclude the possibility of recklessness.

    Summary

    Enrique Rivera was convicted of first-degree manslaughter for the stabbing death of Edgar Ojeda in a bar. Rivera argued the trial court erred by not submitting second-degree manslaughter (reckless manslaughter) to the jury. The New York Court of Appeals affirmed the conviction, holding that there was no reasonable view of the evidence to support a finding that Rivera acted recklessly. The court emphasized that the nature of the victim’s wounds and the defendant’s own statements indicated an intent to cause serious physical injury, precluding a finding of mere recklessness. The court reiterated that a lesser included offense instruction is only required when there is a rational basis for the jury to reject evidence establishing the greater crime while accepting evidence of the lesser crime.

    Facts

    Rivera and Ojeda were both at a Brooklyn bar. Rivera approached Ojeda, and after a brief verbal exchange, Rivera stabbed Ojeda multiple times. Eyewitnesses saw Rivera strike or push Ojeda in the chest. Ojeda died from a stab wound to the chest that pierced his lung and a rib. Rivera initially told police he swung a knife at the crowd in self-defense but didn’t know if he had hurt anyone. At trial, Rivera testified that he did not bring the knife and did not stab Ojeda.

    Procedural History

    Rivera was charged with second-degree murder and criminal possession of a weapon. At trial, he requested that the court also submit charges of second-degree manslaughter and criminally negligent homicide. The trial court refused to submit second-degree manslaughter to the jury. The jury acquitted Rivera of murder but convicted him of first-degree manslaughter. The Appellate Division affirmed. The New York Court of Appeals granted leave to appeal and affirmed the Appellate Division’s order.

    Issue(s)

    Whether the trial court erred in refusing to submit a charge of second-degree manslaughter to the jury as a lesser included offense of second-degree murder.

    Holding

    No, because there was no reasonable view of the evidence that would support a finding that Rivera acted recklessly rather than intentionally causing serious physical injury, as required for first-degree manslaughter.

    Court’s Reasoning

    The Court of Appeals applied the two-pronged test for determining whether a lesser included offense should be charged: (1) the crime must be a lesser included offense, and (2) there must be a reasonable view of the evidence to support a finding that the defendant committed the lesser offense but not the greater. The Court acknowledged that second-degree manslaughter is a lesser included offense of second-degree murder. However, the Court found that Rivera failed to satisfy the second prong because there was no reasonable view of the evidence to suggest recklessness. The court considered the forensic pathologist’s testimony that the wounds were stab wounds, not the result of merely “waving” a knife. Further, the court noted the depth and location of the wounds, which indicated an intent to cause at least serious physical injury. The Court rejected Rivera’s argument that his initial statement suggested recklessness, finding it inconsistent with the nature of the wounds and the circumstances of the stabbing. The Court emphasized that jury instructions should not invite the jury to compromise or return an unwarranted verdict. Quoting People v. Scarborough, 49 NY2d 364, 369-370 (1980), the court stated that “if, on the whole record, there is not some identifiable, rational basis on which the jury could reject a portion of the prosecution’s case which is indispensable to establishment of the higher crime and yet accept so much of the proof as would establish the lesser crime, then the lesser included offense may not be submitted”. The court found no such rational basis here.

  • Kaslow v. New York City Employees’ Retirement System, 23 N.Y.3d 80 (2014): Determining Pension Benefits Based on Tier and Credited Service

    23 N.Y.3d 80 (2014)

    The calculation of pension benefits for New York City employees depends on the specific retirement tier and plan applicable to the employee, and the definition of “credited service” varies accordingly.

    Summary

    David Kaslow, a Tier 3 correction officer, sought to include his prior civilian service with the New York City Department of Environmental Protection (DEP) in the calculation of his pension benefits. The New York City Employees’ Retirement System (NYCERS) denied this request, arguing that his pension was solely defined by Retirement and Social Security Law § 504-a (c) (2), which does not account for prior civilian service. The Court of Appeals reversed the lower courts’ decisions, holding that NYCERS properly calculated Kaslow’s pension, as the relevant statute defined “credited service” in a way that excluded his prior civilian employment. This case highlights the importance of understanding the nuanced rules governing pension benefits in New York, where eligibility and calculation methods vary significantly based on the employee’s retirement tier and specific plan provisions.

    Facts

    David Kaslow worked for DEP from September 1987 to April 1991, during which he was a Tier 4 NYCERS member.
    In April 1991, he became a correction officer with the Department of Correction (DOC), placing him in the Tier 3 CO-20 retirement plan because his DOC employment began after December 19, 1990.
    Kaslow bought back service credit for three years of military service in 2001.
    Prior to retirement, Kaslow was informed by NYCERS that his DEP service would not be included in his pension calculation.

    Procedural History

    Kaslow filed an Article 78 proceeding against the City and NYCERS, seeking to include his DEP service in his pension calculation.
    Supreme Court granted Kaslow’s petition, ordering NYCERS to recalculate his pension to include his DEP service.
    The Appellate Division affirmed the Supreme Court’s decision, finding NYCERS’ interpretation of “credited service” unreasonable.
    The Court of Appeals granted leave to appeal and reversed the Appellate Division, dismissing Kaslow’s petition.

    Issue(s)

    Whether NYCERS properly calculated Kaslow’s pension benefits by excluding his prior civilian service with DEP, based on the provisions of Retirement and Social Security Law § 504-a (c) (2).

    Holding

    No, because Kaslow’s pension is defined entirely by Retirement and Social Security Law § 504-a (c) (2), which does not include a component to reflect any previous civilian government service.

    Court’s Reasoning

    The Court of Appeals reasoned that NYCERS’ interpretation of “credited service” in the context of section 504-a (b) (4) and the Tier 3 CO-20 program is entitled to deference because NYCERS is the expert agency managing the City’s public employee retirement plans. The court emphasized that “What constitutes ‘credited service’ obviously differs from plan to plan.”
    The Court noted that for Tier 3 employees who became subject to Article 14 after December 19, 1990, the term “credited service” should be applied in the same manner as it would be applied to a similarly situated correction officer governed by Article 11 and participating in the Tier 2 CO-20 plan under Retirement and Social Security Law § 445-a.
    The court found that NYCERS’ explanation of how section 504-a (b) (4) applies and fits into the overall statutory design is coherent and reasonable. The court stated that Kaslow’s interpretation conflicted with Retirement and Social Security Law § 504-a (c) (2). Specifically, the court said that Kaslow’s approach of “claiming a benefit for non-uniformed service under section 13-155 (a) (3) (c) but electing to apply the higher fraction in section 504-a (c) (2) (i) (B) to compute the amount owed him for additional correction service — would maximize his pension but does not create a harmonious whole.” The court, therefore, deferred to NYCERS’ interpretation of the statute and upheld its decision to exclude Kaslow’s prior civilian service from his pension calculation.

  • Kapon v. Koch, 23 N.Y.3d 16 (2014): Burden on Non-Parties Moving to Quash Subpoenas

    Kapon v. Koch, 23 N.Y.3d 16 (2014)

    A non-party moving to quash a subpoena bears the initial burden of showing that the requested discovery is utterly irrelevant or futile, after which the subpoenaing party must show the discovery is material and necessary to the action.

    Summary

    This case clarifies the burden of proof when a non-party moves to quash a subpoena under CPLR 3101(a)(4). William Koch subpoenaed John Kapon and Justin Christoph, non-parties, for disclosure in a California fraud action. Kapon and Christoph moved to quash the subpoenas. The New York Court of Appeals held that the non-parties (Kapon and Christoph) had the initial burden to demonstrate that the requested deposition testimony was irrelevant to the California action. If this burden is met, the subpoenaing party (Koch) must then establish that the discovery sought is material and necessary to the prosecution or defense of the action.

    Facts

    William Koch commenced a fraud action in California against Rudy Kurniawan, alleging the sale of counterfeit wine. Koch also had a separate action against Acker, Merrall & Condit Company (AMC) in New York regarding alleged counterfeit wine consigned by Kurniawan. Koch, seeking disclosure for the California action, served subpoenas on John Kapon and Justin Christoph, who were associated with AMC but were not parties to the California lawsuit. The subpoenas included copies of the amended complaint in the California action.

    Procedural History

    Kapon and Christoph commenced a special proceeding to quash the subpoenas. Supreme Court denied the motion to quash, but allowed objections to questions divulging confidential information. The Appellate Division affirmed, finding Kapon and Christoph failed to show the requested testimony was irrelevant. The Court of Appeals granted leave to appeal and affirmed the Appellate Division’s order.

    Issue(s)

    Whether, on a non-party’s motion to quash a subpoena, the subpoenaing party has the initial burden of demonstrating a need for the disclosure in order to prepare for trial?

    Holding

    No, because the non-party moving to quash the subpoena bears the initial burden of showing that the discovery sought is utterly irrelevant or that the futility of the process to uncover anything legitimate is inevitable or obvious.

    Court’s Reasoning

    The Court of Appeals analyzed CPLR 3101(a)(4), which governs disclosure from non-parties. The court acknowledged the 1984 amendment that eliminated the requirement of a court order based on “adequate special circumstances” before seeking disclosure from a non-party, intending to ease discovery from any person possessing material and necessary evidence. The court addressed the split among the appellate divisions regarding the “circumstances or reasons” required for non-party disclosure. It adopted the First and Fourth Departments’ “material and necessary” standard, aligning with New York’s policy of liberal discovery, referencing Allen v. Crowell-Collier Publ. Co., 21 NY2d 403, 406 (1968), stating that the words “material and necessary” as used in section 3101 must “be interpreted liberally to require disclosure, upon request, of any facts bearing on the controversy which will assist preparation for trial by sharpening the issues and reducing delay and prolixity”. The Court emphasized that CPLR 3119(e) requires applications to quash subpoenas to comply with state rules and statutes. It reiterated the established principle from Anheuser-Busch, Inc. v. Abrams, 71 NY2d 327, 331-332 (1988), that a subpoena should be quashed only when the process is inevitably futile or the information utterly irrelevant. The court clarified that while the subpoenaing party must initially state the “circumstances or reasons” for the disclosure, as required by 3101(a)(4), this does not shift the burden of proof on a motion to quash to the subpoenaing party. Instead, this requirement ensures the non-party is informed about why the disclosure is sought. The court concluded that the subpoenas satisfied the notice requirement by including copies of the amended complaint, providing sufficient information for the non-parties to challenge the subpoenas. The court emphasized the importance of the moving party establishing that the subpoena should be vacated, citing Matter of Dairymen’s League Coop. Assn., 274 App Div at 595-596. The court noted that Kapon and Christoph failed to meet their burden of demonstrating that their deposition testimonies were irrelevant to the California action.

  • Hoover v. New Holland N. Am., Inc., 23 N.Y.3d 41 (2014): Product Liability and Substantial Modification Defense

    Hoover v. New Holland N. Am., Inc., 23 N.Y.3d 41 (2014)

    A manufacturer is not automatically shielded from liability for a design defect merely because a safety feature was modified post-sale if there is evidence the safety feature was defectively designed at the time of sale.

    Summary

    Jessica Hoover was severely injured by a post hole digger when her clothing became entangled in its rotating driveline after the safety shield had been removed. Hoover sued CNH America LLC (CNH) and Niagara Frontier Equipment Sales, Inc. (Niagara), alleging a design defect. The defendants claimed the “substantial modification” defense, arguing that the owner’s removal of the shield was a post-sale modification that relieved them of liability. The New York Court of Appeals held that summary judgment was not appropriate for the defendants because there were triable issues of fact regarding whether the safety shield was defectively designed initially, regardless of the subsequent modification. The court emphasized that the defense does not apply when the plaintiff shows the product was dangerous from the outset because of a defectively designed safety feature.

    Facts

    Plaintiff Jessica Hoover was helping her stepfather, Gary Hoover, dig post holes using a tractor-driven post hole digger. The digger’s safety shield, originally made of plastic, had been removed by the previous owner, Peter Smith, after it broke due to wear and tear. While Jessica was holding the gearbox to steady the auger, her jacket became caught in the rotating driveline near the universal joint (U-joint), which had a protruding nut and bolt. She sustained severe injuries, including the amputation of her right arm.

    Procedural History

    Hoover sued CNH and Niagara, among others, alleging negligence and strict products liability based on design defect, manufacturing defect, and failure to warn. The Supreme Court dismissed the manufacturing defect and failure to warn claims but allowed the design defect claim against CNH and Niagara to proceed. After a jury trial, a verdict was rendered in favor of Hoover. The Appellate Division affirmed. The Court of Appeals granted leave to appeal.

    Issue(s)

    Whether the defendants were entitled to summary judgment based on the substantial modification defense, given the evidence of a potential design defect in the safety shield of the post hole digger.

    Holding

    No, because the plaintiff presented sufficient evidence to raise triable issues of fact as to whether the safety shield was defectively designed at the time of sale, precluding summary judgment based on the substantial modification defense.

    Court’s Reasoning

    The Court of Appeals reasoned that the substantial modification defense, articulated in Robinson v. Reed-Prentice Div. of Package Mach. Co., does not automatically absolve a manufacturer of liability if the plaintiff presents evidence that the product was defectively designed at the time of sale. The Court emphasized that, to prevail on a substantial modification defense, the defendant must first demonstrate the product was “not defective” when manufactured and sold. If the defendant makes this showing, they must then show that a post-sale modification rendered the otherwise safe product defective and that the modification was the proximate cause of the plaintiff’s injuries.

    Here, Smith testified that the shield had been destroyed by normal wear and tear, suggesting it was not effectively designed to last. Hoover also presented expert testimony that the plastic shield was inadequately tested and not reasonably safe, and that a safer alternative design was feasible. The court found this was sufficient to create a triable issue of fact. Quoting Robinson, the Court stated that the substantial modification defense is intended to insulate manufacturers “from liability for injuries that would never have arisen but for the post-sale modification of a safety feature on an otherwise safe product.” The Court distinguished Robinson, explaining that in that case, the injured party did not demonstrate that the safety gate was defectively designed. The Court noted that a manufacturer must “use reasonable care” in designing a product that is reasonably safe for all of its intended uses and foreseeable misuses.

  • Melcher v. Greenberg Traurig, LLP, 23 N.Y.3d 10 (2014): Statute of Limitations for Attorney Deceit Claims

    Melcher v. Greenberg Traurig, LLP, 23 N.Y.3d 10 (2014)

    An action for attorney deceit under Judiciary Law § 487 is governed by the six-year statute of limitations in CPLR 213(1), not the three-year statute of limitations in CPLR 214(2), because the cause of action existed at common law prior to statutory enactment, even if it originated in English statute.

    Summary

    Plaintiff Melcher sued defendants, a law firm and one of its attorneys, for attorney deceit under Judiciary Law § 487. The defendants moved to dismiss, arguing that the action was barred by the three-year statute of limitations in CPLR 214(2). Melcher argued for the six-year “catch-all” statute of limitations in CPLR 213(1). The Court of Appeals held that the six-year statute of limitations applies because the cause of action for attorney deceit existed at New York common law before the first New York statute governing attorney deceit was enacted in 1787, even if the claim originated in the first Statute of Westminster.

    Facts

    Melcher brought an action against Greenberg Traurig, LLP and Leslie Corwin for attorney deceit under Judiciary Law § 487. The defendants allegedly engaged in deceitful conduct during prior litigation involving Melcher.

    Procedural History

    The Supreme Court denied the defendants’ motion to dismiss, concluding the defendants were equitably estopped from asserting the statute-of-limitations defense, though agreeing that CPLR 214(2) applied. The Appellate Division reversed, granting the motion to dismiss, finding equitable estoppel inapplicable and the claim time-barred. Two justices dissented, disagreeing on the timeliness of the claim but not addressing equitable estoppel. Melcher appealed to the Court of Appeals.

    Issue(s)

    Whether an action for attorney deceit under Judiciary Law § 487 is governed by the three-year statute of limitations in CPLR 214(2) or the six-year statute of limitations in CPLR 213(1).

    Holding

    No, an action for attorney deceit is governed by the six-year statute of limitations in CPLR 213(1) because liability for attorney deceit existed at New York common law prior to 1787, even if the claim originated in the first Statute of Westminster.

    Court’s Reasoning

    The Court reasoned that while Amalfitano v. Rosenberg (12 N.Y.3d 8 (2009)) established that Judiciary Law § 487 did not derive from common-law fraud but rather from the first Statute of Westminster, this did not automatically mean that the three-year statute of limitations in CPLR 214(2) applied. The Court emphasized that English statutory and common law became New York common law through the Colonial-era incorporation of English law. The Court quoted Bogardus v. Trinity Church, 4 Paige Ch. 178, 198 (1833), stating that statutes in force at the time of colonization become part of the common law of the colony if applicable. The Court noted that a cause of action for attorney deceit existed as part of New York’s common law before the 1787 statute, which merely enhanced penalties by adding treble damages. Citing State of New York v. Cortelle Corp., 38 N.Y.2d 83, 85 (1975), the Court stated that statutes providing only additional remedies do not create new obligations within the meaning of CPLR 214(2). Therefore, even if attorney deceit originated in the Statute of Westminster, liability existed at New York common law prior to 1787, making the six-year statute of limitations in CPLR 213(1) applicable. As the court stated, “Statutory provisions which provide only additional remedies or standing do not create or impose new obligations.” Because of this ruling, the court did not address Melcher’s other arguments.

  • Jacobsen v. New York City Health and Hospitals Corp., 22 N.Y.3d 824 (2014): Employer’s Duty to Engage in Interactive Process for Disability Accommodation

    22 N.Y.3d 824 (2014)

    An employer’s failure to engage in a good faith interactive process to explore reasonable accommodations for a disabled employee generally precludes summary judgment in the employer’s favor on disability discrimination claims under New York State and City Human Rights Laws.

    Summary

    William Jacobsen sued New York City Health and Hospitals Corporation (HHC), alleging disability discrimination under the State and City Human Rights Laws after he was terminated following a diagnosis of pneumoconiosis. Jacobsen requested accommodations, including a transfer to a less hazardous location and respiratory equipment. HHC moved for summary judgment, which was granted by the Supreme Court and affirmed by the Appellate Division. The Court of Appeals reversed, holding that HHC’s failure to engage in a good faith interactive process regarding Jacobsen’s requested accommodations created a triable issue of fact, precluding summary judgment. The court emphasized that employers must consider an employee’s proposed accommodations and engage in a dialogue about their feasibility.

    Facts

    William Jacobsen worked for HHC as a health facilities planner since 1979. His job involved site visits to construction projects. In 2005, he was transferred to a location with more frequent site visits and was diagnosed with pneumoconiosis due to asbestos exposure. Jacobsen requested a three-month medical leave and, upon his return, requested accommodations including protective respiratory equipment and a transfer back to the central office where he had previously worked with less exposure to construction sites. These requests were largely unmet, and he was eventually placed on unpaid medical leave and then terminated.

    Procedural History

    Jacobsen filed a complaint alleging disability discrimination under the State and City Human Rights Laws, as well as gross negligence. The Supreme Court granted HHC’s motion for summary judgment, dismissing the complaint. The Appellate Division affirmed. The Court of Appeals granted leave to appeal and certified the question of whether the Appellate Division’s order was properly made.

    Issue(s)

    1. Whether an employer’s failure to engage in a good faith interactive process regarding a disabled employee’s request for reasonable accommodation precludes summary judgment in favor of the employer on claims under the New York State Human Rights Law.
    2. Whether an employer’s failure to engage in a good faith interactive process regarding a disabled employee’s request for reasonable accommodation precludes summary judgment in favor of the employer on claims under the New York City Human Rights Law.

    Holding

    1. Yes, because the employer must demonstrate it considered the requested accommodation and engaged in interactions revealing deliberation on its viability to obtain summary judgment on a State HRL claim.
    2. Yes, because the City HRL provides broader protections against disability discrimination, unquestionably foreclosing summary judgment where the employer has not engaged in a good faith interactive process.

    Court’s Reasoning

    The Court of Appeals reasoned that both the State and City Human Rights Laws require employers to engage in a good faith interactive process when an employee requests a reasonable accommodation. The court emphasized the individualized standard required by the State HRL, meant to move away from generalized assumptions about disabilities. The court cited the legislative intent behind the HRL amendments, which sought to encourage fair-minded discussion and voluntary integration of disabled employees into the workplace. The court held that HHC failed to demonstrate that it engaged in such a process with Jacobsen. Regarding the City HRL claim, the court noted the employer bears the burden to show the unavailability of any safe and reasonable accommodation. The court pointed to conflicting evidence regarding Jacobsen’s ability to perform his job duties at the central office, and HHC’s failure to adequately consider his request for a respirator. The court stated, “The relevant inquiry is whether the employee was capable of performing the core functions of the employee’s position at the time that the employer refused to accommodate the employee’s disability.” The court concluded that, at the very least, a material issue of fact existed as to whether HHC reasonably accommodated Jacobsen’s disability.
    The Court rejected the argument that Jacobsen’s eventual total disability relieved HHC of liability, stating that the statutes are designed to protect workers from being forced to choose between their health and their livelihood. While the court acknowledged the burden of proof at trial would be on Jacobsen to prove a reasonable accommodation existed under the State HRL, HHC had not met its burden on summary judgment of showing, as a matter of law, that no such accommodation was available. The court explicitly rejected an interpretation of Phillips v City of New York that a good faith interactive process is an independent element which, if lacking, automatically compels summary judgment for the employee. The lack of such a process is a factor in determining whether an accommodation was available.