Marco v. Sachs, 271 N.E.2d 248 (N.Y. 1971)

An action should not be automatically dismissed for failure to prosecute under Rule 302 when it was removed from the calendar due to a settlement agreement that ultimately failed; the Appellate Division has discretion to dismiss based on the facts of the delay, considering the circumstances surrounding the settlement attempt and subsequent inaction.

Summary

This case addresses whether a negligence action, initially marked “dismissed” due to an ineffectual settlement agreement, should be automatically dismissed for failure to prosecute. The New York Court of Appeals held that the action was incorrectly marked as dismissed because the removal from the calendar stemmed from the settlement attempt. The court modified the Appellate Division’s order, remanding the case to allow the Appellate Division to determine, based on the specific facts and exercising its discretion, whether the administratrix’s delay in seeking to restore the action to the calendar after the settlement failed warranted dismissal.

Facts

The plaintiff filed a negligence action for a sidewalk fall. A contingent settlement agreement was reached where the defendant would pay $3,250 if the plaintiff executed a general release personally. The stipulation was recorded, and the court indicated that the plaintiff’s attorney could accept the settlement or proceed to trial, which would likely result in dismissal due to the plaintiff’s disappearance. Eleven years later, the plaintiff’s wife was appointed administratrix based on an affidavit stating the plaintiff was last seen in 1950. She had obtained an Enoch Arden divorce in 1958. As administratrix, she moved to restore the action after the defendant’s motion to dismiss.

Procedural History

The case was at issue in February 1950. In 1952, a settlement agreement was made but not fulfilled. In 1963, plaintiff’s wife was appointed administratrix. In 1965, she moved to restore the action to the calendar. Her motion for judgment on the settlement agreement was denied. The Appellate Division dismissed the complaint. The Court of Appeals reviewed the Appellate Division’s decision.

Issue(s)

Whether the negligence action was correctly marked “dismissed” under Rule 302 of the former Rules of Civil Practice, given its removal from the calendar due to a settlement agreement that ultimately proved ineffectual.

Holding

No, because the action was removed from the calendar because of the settlement agreement which proved to be ineffectual. Therefore, the case was incorrectly marked as dismissed. The Appellate Division has the discretion to dismiss based on the facts of the administratrix’s delay in seeking to restore the action to the calendar after learning that the settlement agreement was ineffectual.

Court’s Reasoning

The Court of Appeals reasoned that the initial removal from the calendar was directly tied to the settlement attempt. Because the settlement failed, the case should not have been automatically dismissed under Rule 302, which typically applies to cases abandoned due to neglect. The court emphasized the importance of considering the context of the settlement negotiations. The court remanded the case to the Appellate Division, granting it the discretion to decide whether the administratrix’s delay in pursuing the case after the settlement fell through warranted dismissal. The court acknowledged that the Appellate Division could consider the facts of the delay and exercise its discretion, aligning with precedents like Thomas v. Melbert Foods and Commercial Credit Corp. v. Lafayette Lincoln-Mercury. The Court emphasized a fact-specific inquiry is needed, not a rote application of dismissal rules. There were no dissenting or concurring opinions noted.