New York Law Review

Tag: statute of limitations

  • Medical Facilities, Inc. v. Pryke, 62 N.Y.2d 716 (1984): Enforceability of Shortened Limitations Period in Insurance Policy

    Medical Facilities, Inc. v. Pryke, 62 N.Y.2d 716 (1984)

    An insurer cannot enforce a shortened limitations period for commencing suit if the insurance policy fails to include the statutorily mandated language or any reference to such a period.

    Summary

    Medical Facilities, Inc. sued John William Pryke’s underwriters to recover for business interruption and rent loss under a fire insurance policy. The fire occurred six years and three days before the suit was filed. The insurance policy lacked the standard language mandated by New York Insurance Law § 168(5) regarding a shortened limitations period. Pryke argued the suit was untimely. The court held that because the policy omitted the required language, the standard six-year statute of limitations for contract actions applied, making the suit timely. Actual notice of a shortened period, even if provided, does not cure the defect of omitting it from the policy itself.

    Facts

    Medical Facilities, Inc. operated a health care facility covered by a fire insurance policy issued by underwriters represented by John William Pryke. A fire occurred at the facility. Medical Facilities, Inc. filed a claim for business interruption and rent loss under the policy. Six years and three days after the fire, Medical Facilities, Inc. commenced a lawsuit to recover under the policy.

    Procedural History

    The trial court denied Pryke’s motion to dismiss the complaint as untimely. Pryke appealed. The Appellate Division affirmed the trial court’s decision. Pryke then appealed to the New York Court of Appeals. The Court of Appeals affirmed the Appellate Division’s order.

    Issue(s)

    1. Whether an insurer can enforce a shortened statute of limitations in an insurance policy when the policy does not contain the language mandated by New York Insurance Law § 168(5) or any reference to a shortened limitations period.

    Holding

    1. No, because an insurer who issues a policy omitting reference to the shortened limitations period, in violation of statutory mandate, cannot claim the benefit of its own omission, for an insured would otherwise have no notice that his time to commence suit was different from that provided by law for any contract action.

    Court’s Reasoning

    The court reasoned that because the insurance policy did not include the “165 lines” required by Insurance Law § 168(5), or any reference to a shortened statute of limitations, the general six-year statute of limitations for breach of contract actions under CPLR 213(2) applied. The court emphasized that an insurer cannot benefit from its own failure to comply with the statutory mandate to include the shortened limitations period in the policy. The court stated that without such notice, an insured would not be aware that the time to commence a lawsuit was different from the standard contractual period. The court rejected the argument that actual notice of a shortened limitations period, allegedly given within two years of the fire, could cure the defect of omitting the shortened period from the contract itself, stating that “even actual notice would not have cured the insurer’s failure to make a shortened limitations period part of the insurance contract.” The court clarified the accrual date for a cause of action against an insurer: “A cause of action against an insurer will accrue on the date of the fire if the policy so provides (Proc v Home Ins. Co., 17 NY2d 239), but in the absence of any provision regarding accrual in the contract of insurance the Statute of Limitations for breach of contract generally begins to run upon breach.” Since the policy required claims to be paid within 30 days of proof of loss and the lawsuit was filed six years and three days after the fire, the lawsuit was timely.

  • Markoff v. South Nassau Community Hospital, 61 N.Y.2d 283 (1984): Recommencement Statute Requires Valid Initial Service

    Markoff v. South Nassau Community Hospital, 61 N.Y.2d 283 (1984)

    CPLR 205(a), the statute allowing for recommencement of an action after dismissal, requires that the initial action be timely commenced with proper service; an action dismissed for lack of personal jurisdiction due to improper service is not considered “commenced” for the purposes of the statute, even if the defendant had actual notice.

    Summary

    Plaintiff sued defendants for medical malpractice and wrongful death. The initial attempt at service was deemed invalid, and the ex parte order authorizing expedient service was vacated. After the statute of limitations had expired, the plaintiff properly served the defendants. The Court of Appeals held that CPLR 205(a) did not apply because the original action was never properly commenced due to the lack of valid service. The Court emphasized that actual notice to the defendant does not cure a failure to comply with the prescribed methods of service. Therefore, the action was time-barred.

    Facts

    Milton Markoff was treated at South Nassau Community Hospital by defendant doctors in October 1978. He died eight months later, allegedly due to the defendants’ malpractice. Plaintiff Ruth Markoff, individually and as executrix, attempted to commence an action for medical malpractice and wrongful death.

    Procedural History

    Plaintiff initially attempted service on July 14, 1980, which was unsuccessful. On March 19, 1981, plaintiff obtained an ex parte order authorizing expedient service. Summonses were left at the hospital for the defendant doctors on March 30, 1981. The defendants asserted lack of personal jurisdiction and moved to vacate the ex parte order, which was granted in May 1981. The action was terminated on September 23, 1981, for lack of personal jurisdiction. In late August and early September 1981, the plaintiff personally served the defendants. The defendants raised the statute of limitations as a defense. The plaintiff argued the answer was untimely and that CPLR 205 applied. The defendants successfully moved to vacate the default and to dismiss the action based on the statute of limitations. The Appellate Division affirmed the vacatur of the ex parte order and the dismissal of the complaint. The Court of Appeals then reviewed the case.

    Issue(s)

    Whether CPLR 205(a) applies to allow recommencement of an action when the initial action was dismissed for lack of personal jurisdiction due to improper service, even if the defendant had actual notice of the action.

    Holding

    No, because CPLR 205(a) requires that the initial action be timely commenced, and an action dismissed for lack of personal jurisdiction due to improper service is not considered “commenced” under the statute, regardless of actual notice.

    Court’s Reasoning

    The Court of Appeals reasoned that CPLR 205(a) allows a plaintiff to commence a new action within six months of the termination of a prior action if the prior action was “timely commenced.” The Court stated that an action is “commenced” when there has been service of a summons, but such service is only effective when made pursuant to the appropriate method authorized by the CPLR. The Court emphasized that “actual notice alone will not sustain the service or subject a person to the court’s jurisdiction when there has not been compliance with prescribed conditions of service.” The Court distinguished this situation from cases where the court had subject matter jurisdiction, noting that here, the lack of personal jurisdiction in the first action meant it was never properly “commenced.” The Court stated it was not creating a new exception to CPLR 205(a), but rather clarifying that a timely commencement is a condition precedent to invoking the statute. Because the ex parte order authorizing alternative service was vacated, the initial service was nullified, and the plaintiff’s later service occurred after the statute of limitations had run, barring the action.

  • State of New York v. Lundin, 60 N.Y.2d 987 (1983): Statute of Limitations for Contract Claims Begins at Substantial Completion

    State of New York v. Lundin, 60 N.Y.2d 987 (1983)

    A cause of action for breach of contract accrues, and the statute of limitations begins to run, when the contract is substantially completed, regardless of when the final payment is due or made.

    Summary

    The New York Court of Appeals held that the State’s breach of contract claim against a contractor, Lundin, was time-barred because the action was commenced more than six years after Lundin substantially completed the work, even though the final payment and related disputes occurred later. The court reasoned that the cause of action accrued upon substantial completion, not upon final payment or resolution of payment disputes. This case clarifies that the focus for statute of limitations purposes is on when the work was done, not when the money was (or wasn’t) paid.

    Facts

    In April 1967, the plaintiff, was awarded a contract to build an ice skating rink at Clove Lake Park in Staten Island. The contract was a unit-price contract, meaning the actual cost was to be determined after construction. The contractor did not present the premises for a final inspection until September 28, 1971. In January 1978, the plaintiff commenced an action seeking to recover for extra materials, additional work, losses due to project delays, and alleging a total breach of contract.

    Procedural History

    The defendant answered and asserted that the action was barred by the Statute of Limitations. Both the Supreme Court and the Appellate Division denied the defendant’s motion to dismiss the complaint. The Court of Appeals reversed, granting the motion to dismiss.

    Issue(s)

    Whether a breach of contract action accrues, for statute of limitations purposes, upon substantial completion of the contract or upon the final determination of payment owed under the contract.

    Holding

    No, because a cause of action in contract accrues when a breach occurs, and in construction contracts, the breach typically occurs when the work is substantially completed, regardless of when payment is finalized or disputes are resolved.

    Court’s Reasoning

    The Court of Appeals determined that the State’s cause of action accrued when the contractor substantially completed the work in 1971. The court emphasized that “a cause of action accrues when a breach of contract occurs.” The court rejected the argument that the cause of action accrued when the final payment was determined or when the State disputed the amount owed. The court reasoned that the liability arose out of the contract and the alleged improper performance thereof, and not out of the nonperformance of payment. The court distinguished between a suit on “liability arising out of the contract” and one for “nonperformance of payment,” stating that the gravamen of any contract action is that one party claims that it is owed certain obligations because of the agreement and that the other party has not performed those obligations. A dissenting opinion argued that the cause of action for payment does not accrue until the owner refuses to pay all that was requested, viewing the owner’s audit and determination of payment as a condition precedent to the contractor’s right to sue for final payment. However, the majority did not accept this argument. The court found the action was commenced more than six years after the completion, it was time-barred.

  • In the Matter of Schlaifer v. Kaiser, 61 N.Y.2d 752 (1984): Distinguishing Contract Modification from Novation

    In the Matter of Schlaifer v. Kaiser, 61 N.Y.2d 752 (1984)

    Whether a subsequent agreement constitutes a novation or merely a modification of a prior contract depends on the parties’ intent; absent extrinsic evidence, this determination is a question of law for the court, assessed by comparing the agreements.

    Summary

    This case concerns whether a 1976 agreement between Schlaifer and Kaiser was a novation that extinguished their 1974 contract, or simply a modification. The Court of Appeals held it was a modification. The court also addressed the timeliness of Kaiser’s demand for arbitration seeking rescission based on fraud. The court determined that the arbitration demand was time-barred under CPLR 213(1) and 203(f) because it was filed more than six years after the contract date and more than two years after Kaiser discovered the alleged fraud. Therefore, the Court affirmed the Appellate Division’s decision to stay arbitration.

    Facts

    Schlaifer and Kaiser entered into a contract on June 18, 1974. Later, in 1976, they entered into another agreement. In August 1981, Kaiser served a demand for arbitration, seeking rescission of the 1974 contract based on allegations of fraud.

    Procedural History

    Kaiser sought arbitration of the 1974 agreement based on fraud. The Appellate Division stayed the arbitration. The Court of Appeals reviewed the Appellate Division’s order pursuant to Section 500.4 of the Rules of the Court of Appeals and affirmed the stay.

    Issue(s)

    1. Whether the 1976 agreement constituted a novation of the 1974 agreement, or merely a modification.
    2. Whether Kaiser’s demand for arbitration, seeking rescission of the 1974 agreement based on fraud, was timely.

    Holding

    1. No, the 1976 agreement was a modification, not a novation, because comparison of the two agreements indicates an intent to modify rather than extinguish the 1974 contract.
    2. No, the demand for arbitration was untimely because it was served more than six years after the contract date and more than two years after the discovery of the alleged fraud, exceeding the limitations periods specified in CPLR 213(1) and 203(f).

    Court’s Reasoning

    The Court reasoned that whether the 1976 agreement was a novation or a modification depends on the intent of the parties. Absent extrinsic evidence of intent, the determination is a question of law for the court. The Court stated, “Comparison of the two agreements establishes that what was intended was modification rather than extinguishment of the 1974 contract.” The court relied on Mallad Constr. Corp. v County Fed. Sav. & Loan Assn., 32 NY2d 285, 288, 293 for the principle that intent determines whether a subsequent agreement is a novation or modification. The Court further reasoned that arbitration of a claim for rescission for fraud must be commenced within six years after the date of the contract, or within two years after the fraud was or with reasonable diligence could have been discovered, citing CPLR 213(1) and 203(f), as well as 35 Park Ave. Corp. v Campagna, 48 NY2d 813. Because Kaiser’s demand was served after both of these deadlines, the Court found the Appellate Division was correct in staying arbitration.

  • Giblin v. Nassau County Medical Center, 61 N.Y.2d 69 (1984): Tolling Statute of Limitations During Late Notice of Claim Application

    Giblin v. Nassau County Medical Center, 61 N.Y.2d 69 (1984)

    The Statute of Limitations for municipal tort liability is tolled while a plaintiff’s application for permission to file a late notice of claim is pending, even after the 1976 amendment to General Municipal Law § 50-e.

    Summary

    This case addresses whether the Statute of Limitations is tolled when a plaintiff applies for permission to file a late notice of claim against a municipality. The Court of Appeals held that the Statute of Limitations is indeed tolled during the pendency of such an application. This ruling reaffirms the principle established in Barchet v. New York City Transit Authority, despite a 1976 amendment to General Municipal Law § 50-e. The amendment, which allowed late notice applications even after an action’s commencement, did not eliminate the statutory impediments to suit that prevent proper commencement until permission to file a late notice is granted.

    Facts

    In Giblin, Martin Giblin was treated at Nassau Medical Center on November 16, 1980, for a wrist injury. He applied for permission to file a late notice of claim against the county and the Medical Center on August 13, 1981, alleging he discovered a fracture in June 1981 that was initially treated as a sprain. The motion was granted on September 15, 1981, and the notice of claim was filed soon after. However, the summons and complaint were not served until March 4, 1982.

    In Davis, Glen Davis was injured on May 17, 1980, falling between subway cars. He applied for leave to file a late notice of claim against the New York City Transit Authority on December 29, 1980. The motion was granted on March 25, 1981, and his notice of claim was deemed served. He commenced the action by serving the summons and complaint on October 1, 1981.

    Procedural History

    In Giblin, the Supreme Court, Nassau County, denied the defendant’s motion to dismiss, holding the Statute of Limitations was tolled during the application for leave to file a late notice of claim. The Appellate Division, Second Department, reversed and dismissed the complaint. Plaintiff appealed based on the reversal.

    In Davis, the Supreme Court, Kings County, denied the motion to dismiss and granted the cross-motion, relying on Barchet. The Appellate Division, Second Department, reversed, citing its decision in Giblin as dispositive. Plaintiff appealed based on the reversal.

    Issue(s)

    Whether the Statute of Limitations for municipal tort liability is tolled while a plaintiff’s application for permission to file a late notice of claim is pending, considering the 1976 amendment to General Municipal Law § 50-e.

    Holding

    Yes, because the 1976 amendment did not eliminate the statutory impediments to suit that prevent a plaintiff from properly commencing an action until permission to file a late notice of claim is granted. Therefore, the rationale of Barchet still applies, and CPLR 204(a) tolls the Statute of Limitations during the pendency of the motion.

    Court’s Reasoning

    The Court of Appeals reasoned that the 1976 amendment to General Municipal Law § 50-e, which allows for late notice of claim applications to be made even after an action has commenced, did not fully eliminate the need for the Barchet rule. Prior to the amendment, a plaintiff was effectively prohibited from commencing an action until the court granted permission to file a late notice of claim. The amendment only removed the obstacle of applying for late notice after commencing an action, but it did not alter the underlying requirement that a notice of claim must be served and that a specified period must elapse before suit can be brought. The court emphasized that these requirements still function as conditions precedent to suit. As stated in the opinion, these requirements do not “specifically proscribe the prosecution of the action * * * they prescribe procedures which have the same effect”. Because statutory impediments to commencing the action remained, the Court found the Barchet rationale still valid and CPLR 204(a) should toll the Statute of Limitations. The Court also reviewed the legislative history of the amendment, finding it supported the conclusion that the amendment was not intended to abolish the Barchet rule. The court disagreed with the Appellate Division’s reliance on Corey v. County of Rensselaer, noting that the Corey decision failed to acknowledge the Barchet decision. Ultimately, the Court of Appeals reversed the Appellate Division’s orders and reinstated the Supreme Court’s orders in both the Giblin and Davis cases, affirming the tolling of the Statute of Limitations during the application process.

  • State v. Lundin, 60 N.Y.2d 987 (1983): Accrual of Construction Defect Claims

    60 N.Y.2d 987 (1983)

    In a construction defect case, the cause of action accrues upon the physical completion of the construction project, not the issuance of a final certificate, especially when the owner controls the issuance of that certificate.

    Summary

    The State of New York sued a general contractor and architect for allegedly defective construction and design of the Empire State Plaza. The defendants argued the statute of limitations had expired, as the lawsuit was filed more than six years after the project’s completion. The Court of Appeals affirmed the lower court’s grant of summary judgment for the defendants, holding that the cause of action accrued upon the actual physical completion of construction, not the issuance of the final certificate of acceptance. The court reasoned that the state fully occupied the building before July 31, 1973, it had assumed responsibility for building security, and it had permitted fire and liability insurance carried by the contractor to be canceled. The Court found that, despite some paperwork continuing after that date, the construction was demonstrably complete before July 31, 1973. Since the suit was filed July 31, 1979, it was time-barred.

    Facts

    The State of New York contracted with a general contractor and architect for the construction of the Empire State Plaza. The State later claimed the construction was defective. The State fully occupied the building, assumed responsibility for building security, and allowed the contractor’s insurance to lapse before July 31, 1973. A lawsuit was filed on July 31, 1979, alleging improper design, installation, and supervision of the marble facing on the Swan Street building.

    Procedural History

    The Supreme Court granted the defendants’ motions for summary judgment, concluding construction was completed before July 31, 1973. The Appellate Division affirmed this decision. The New York Court of Appeals granted leave to appeal and affirmed the Appellate Division’s order.

    Issue(s)

    Whether the State’s cause of action for defective construction accrued more than six years before the commencement of the action, thus barring the claim under the statute of limitations.

    Holding

    Yes, because the cause of action for defective construction accrues upon the actual physical completion of the work, which occurred before July 31, 1973, making the lawsuit filed on July 31, 1979, time-barred.

    Court’s Reasoning

    The Court of Appeals held that the cause of action accrued upon the completion of the actual physical work. The Court distinguished this case from Board of Educ. of Tri-Valley Cent. School Dist. v Celotex Corp., noting that here, the owner (the State) controlled the issuance of the final certificate, unlike the architect-controlled certification in Tri-Valley. The Court found that the ongoing relationship between the State, architect, and contractor after July 31, 1973, related to post-construction price negotiations and incidental matters, not the performance of contractual duties. The Court considered the fact that the State had fully occupied the building, assumed security responsibilities, and allowed the contractor’s insurance to be canceled, all before July 31, 1973, as strong evidence that construction was complete. The Court dismissed arguments based on contractor forms indicating later payroll periods, finding they did not specify actual work done after July 31, 1973. Even a minimal amount of work done after that date couldn’t change the fact that the project was demonstrably complete before then. The Court emphasized that despite volumes of affidavits and exhibits, there was no mention of any actual ongoing construction after July 31, 1973, but only paperwork. Judge Jasen dissented, arguing the record contained sufficient evidence of work continuing after July 31, 1973, to warrant a hearing. He pointed to supplemental agreements for supervisory services, vouchers submitted by the architect, and affidavits from the contractor and subcontractors indicating work performed beyond that date. He also noted applications for payment certifying work performed after July 31, 1973. The majority dismissed the dissent’s arguments, stating the payment applications reflected equitable adjustments, supplemental agreements, and retainage, rather than work performed.

  • Matter of Biondo v. New York City Bd. of Educ., 56 N.Y.2d 971 (1982): Statute of Limitations in Article 78 Proceedings

    Matter of Biondo v. New York City Bd. of Educ., 56 N.Y.2d 971 (1982)

    For a determination to be final and trigger the statute of limitations for an Article 78 proceeding, it must be clear that the petitioner seeking review has been aggrieved by it.

    Summary

    This case concerns the statute of limitations for Article 78 proceedings in New York. The petitioner, Biondo, was terminated from his position with the New York City Board of Education due to issues with his teaching license. He argued that the statute of limitations should not bar his claim because of misstatements regarding his license and his attempts to seek reconsideration and file a grievance. The Court of Appeals held that the statute of limitations began to run when Biondo was initially informed of his termination and that his subsequent actions did not toll or revive the limitations period. The Court emphasized that the key inquiry is when the petitioner was clearly aggrieved by the administrative determination.

    Facts

    Biondo’s employment with the New York City Board of Education was based on a teaching license he obtained in 1972.

    On April 21, 1976, Biondo was informed that his services were being terminated because he did not meet the requirements of his 1972 license.

    Biondo directed correspondence to the respondents, which the court viewed as, at most, a request for reconsideration.

    Biondo also attempted to invoke a grievance proceeding under the United Federation of Teachers collective bargaining agreement, but it was determined that this avenue was not available to him.

    Procedural History

    Biondo commenced an Article 78 proceeding to challenge his termination.

    The lower courts dismissed the proceeding as time-barred.

    The Court of Appeals affirmed the dismissal, holding that the four-month statute of limitations had expired.

    Issue(s)

    Whether the four-month statute of limitations for commencing an Article 78 proceeding began to run when Biondo was initially notified of his termination based on issues with his teaching license.

    Whether respondents’ misstatements and subsequent clarification concerning petitioner’s 1973 license should be viewed as relevant to respondents’ decision, in 1976 to rescind petitioner’s 1972 license and terminate his services.

    Whether Biondo’s correspondence, viewed as a request for reconsideration, tolled or revived the statute of limitations.

    Whether Biondo’s attempt to invoke a grievance proceeding tolled the statute of limitations.

    Holding

    1. No, because the statute of limitations begins to run when the petitioner is clearly aggrieved by the determination being challenged.

    2. No, Inasmuch as petitioner’s appointment was based on his 1972 license, respondents’ misstatements and subsequent clarification concerning petitioner’s 1973 license cannot be viewed as relevant to respondents’ decision, in 1976 to rescind petitioner’s 1972 license and terminate his services.

    3. No, because a request for reconsideration does not toll or revive the statute of limitations.

    4. No, because the invocation of a grievance proceeding that is ultimately deemed unavailable does not toll the statute of limitations.

    Court’s Reasoning

    The Court relied on CPLR 217, which states that an Article 78 proceeding must be commenced within four months after the determination becomes final and binding.

    The Court stated, “For a determination to be final it must be clear that the petitioner seeking review has been aggrieved by it.” Matter of Martin v Ronan, 44 NY2d 374, 380.

    The Court reasoned that Biondo was clearly aggrieved when he was informed of his termination on April 21, 1976. Therefore, the statute of limitations began to run from that date.

    The Court further reasoned that the Board of Education’s alleged misstatements and subsequent clarifications regarding Biondo’s 1973 license did not affect the initial determination to terminate him based on his 1972 license.

    The Court cited Matter of De Milio v Borghard, 55 NY2d 216, in support of its holding that a request for reconsideration does not toll or revive the statute of limitations.

    The Court also held that Biondo’s attempt to invoke a grievance proceeding, which was ultimately deemed unavailable under the collective bargaining agreement, did not toll the statute of limitations.

  • Martin v. Edwards Labs, 57 N.Y.2d 422 (1982): Statute of Limitations for Implanted Devices Runs from Injury

    57 N.Y.2d 422 (1982)

    The statute of limitations for personal injury caused by a malfunctioning prosthetic or contraceptive device implanted or inserted into the body runs from the date of the injury resulting from the malfunction, not necessarily from the date of implantation or insertion.

    Summary

    These consolidated cases, Martin v. Edwards Labs and Lindsey v. A.H. Robins Co., concern the statute of limitations for injuries caused by implanted medical devices. Martin involved a malfunctioning heart valve, while Lindsey involved a Daikon Shield IUD. The key issue was whether the statute of limitations began running at the time of implantation/insertion or at the time the injury occurred due to the device’s malfunction. The New York Court of Appeals held that the statute of limitations runs from the date of the injury-causing malfunction, balancing the manufacturer’s need for repose with the injured party’s right to a reasonable chance to assert their claim. This rejects a strict ‘date of implantation’ rule.

    Facts

    In Martin, an artificial aortic valve was implanted in Michael Martin in 1976. Martin died in 1979, and a lawsuit was filed in 1981 alleging that Teflon particles from the valve lodged in his brain, contributing to his death. In Lindsey, Joyce Lindsey had a Daikon Shield IUD inserted in 1971. In 1973, she developed a pelvic infection, causing permanent damage and infertility. She filed suit in 1976.

    Procedural History

    In Martin, the Supreme Court initially dismissed the case as time-barred but reinstated it on reargument. The Appellate Division then modified, dismissing the personal injury cause of action. In Lindsey, Special Term dismissed the complaint against Robins (the manufacturer) but not entirely against Ullman (the doctor). The Appellate Division modified, denying Robins’ motion to dismiss. Both cases reached the New York Court of Appeals due to the significance of the statute of limitations issue.

    Issue(s)

    1. Whether the statute of limitations for a product liability action involving a medical device implanted or inserted into the body begins to run at the time of implantation/insertion or at the time of injury caused by the device’s malfunction.
    2. (Lindsey only) Whether the plaintiff presented sufficient evidence to establish a malfunction within three years prior to the lawsuit.
    3. (Lindsey only) Whether the plaintiff’s motion to amend the complaint to include a fraud cause of action should have been granted.

    Holding

    1. No, the statute of limitations begins with the injury-causing malfunction of the product because before the injury, the plaintiff has no cause to complain.
    2. Yes, the physician’s affidavit was sufficient to create a triable issue of fact regarding when the injury occurred because the defendant has the burden to prove the injury occurred outside the limitations period.
    3. No, the motion to amend was untimely because the plaintiff had evidence of the alleged fraud more than two years before the motion.

    Court’s Reasoning

    The court balanced the manufacturer’s interest in defending claims before their ability to do so deteriorates with the injured person’s interest in not being deprived of a claim before a reasonable chance to assert it. The court distinguished between inhaled, ingested, or injected substances (where the harm begins upon entry into the body) and implanted devices (where no harm occurs until malfunction). Applying the date-of-injury rule from Victorson v. Bock Laundry Mach. Co. was deemed most appropriate. The court reasoned that like the user of a machine, until a malfunction occurs, the plaintiff has no cause to complain. The availability of the device post-malfunction mitigates concerns about stale claims. The court stated, “[T]he proper rule to be applied with respect to products implanted or inserted in the human body is neither time of implantation or insertion nor time of discovery, but Victorson’s date of injury rule, which will most often be the date when the product malfunctions.” In Lindsey, the court found the physician’s affidavit sufficient to raise a triable issue of fact as to when the injury occurred, noting the defendant’s burden of proof on the statute of limitations defense. However, the motion to amend the complaint was deemed untimely as the plaintiff possessed evidence of fraud more than two years before seeking to amend. The court emphasized that the original complaint failed to sufficiently state the circumstances constituting fraud.

  • Antone v. General Motors Corp., 64 N.Y.2d 930 (1985): Borrowing Statute Includes Tolling Provisions

    Antone v. General Motors Corp., 64 N.Y.2d 930 (1985)

    When New York’s borrowing statute (CPLR 202) is invoked to apply a foreign state’s statute of limitations, the foreign state’s tolling provisions are also borrowed, and a defendant asserting the foreign statute bears the burden of proving they were present in that state to avoid the tolling provision.

    Summary

    This case addresses the application of New York’s borrowing statute when a plaintiff seeks to enforce a judgment obtained in another state. The Court of Appeals held that when New York borrows a foreign statute of limitations, it also borrows the foreign state’s tolling provisions. Furthermore, a defendant who claims the benefit of the foreign statute of limitations, while admitting non-residency in that state, bears the burden of proving their presence in the foreign jurisdiction to demonstrate that the statute was not tolled. This decision clarifies the procedural aspects of applying foreign statutes of limitations in New York courts.

    Facts

    The plaintiff, an Alabama resident, obtained a judgment in Alabama against a dissolved Delaware corporation. The plaintiff then sued the former officers of the corporation, who were New York residents, in New York to enforce the Alabama judgment.

    Procedural History

    The defendants moved to dismiss the action as untimely under Alabama law, invoking New York’s borrowing statute (CPLR 202). The lower court granted the motion, but the Court of Appeals reversed, holding that the defendants failed to establish a prima facie defense that the action was time-barred.

    Issue(s)

    Whether, when New York’s borrowing statute (CPLR 202) is invoked to apply a foreign state’s statute of limitations, the foreign state’s tolling provisions are also borrowed, and whether the defendant bears the burden of proving presence in the foreign state to avoid the tolling provision.

    Holding

    Yes, because in borrowing the Alabama Statute of Limitations, its tolling statute is also borrowed. Further, the defendants failed to provide evidence that they were in Alabama after the plaintiff’s cause of action accrued; therefore, they did not establish a prima facie defense that the action was time-barred.

    Court’s Reasoning

    The Court reasoned that when New York borrows a foreign statute of limitations, it must also borrow the foreign state’s tolling provisions. This principle is rooted in the idea that the entire statutory scheme of the foreign jurisdiction should be applied consistently. The court cited Hanna v. Stedman, 230 N.Y. 326 (1920), and Klotz v. Angle, 220 N.Y. 347 (1917), to support this proposition.

    The Court emphasized that a defendant who concedes non-residency in the foreign jurisdiction has the burden of proving their presence there to avoid the tolling statute. The Court stated, “A defendant who concedes nonresidency in New York is presumed to have been absent from the State and, therefore, is required to prove his or her presence here in order to avoid New York’s tolling statute (CPLR 207) and obtain the protection of New York’s Statutes of Limitation (Beresovksi v Warszawski, 28 NY2d 419, 422, 425-426).” This presumption and burden of proof are considered procedural matters governed by the law of the forum (New York). The Court cited Kilberg v. Northeast Airlines, 9 N.Y.2d 34 (1961), to underscore that procedural matters are governed by the law of the forum.

    In this case, the defendants admitted residency in New York and failed to provide evidence of their presence in Alabama after the cause of action accrued. Therefore, they did not meet their burden of establishing a prima facie defense that the action was time-barred under Alabama law. The Court concluded that it was inappropriate to dismiss the complaint on this ground.

  • Matter of Biondo v. New York State Board of Parole, 60 N.Y.2d 832 (1983): Statute of Limitations Tolled Until Notice of Determination

    Matter of Biondo v. New York State Board of Parole, 60 N.Y.2d 832 (1983)

    The statute of limitations for challenging an administrative determination does not begin to run until the petitioner receives notice of the determination, as the petitioner is not “aggrieved” until they are aware of it.

    Summary

    Biondo, a parolee, sought judicial review of the Parole Board’s decision to dismiss his appeal as moot after his sentence expired while the appeal was pending. The New York Court of Appeals held that the statute of limitations for challenging the board’s determination did not begin to run until Biondo received notice of the determination. The court reasoned that a petitioner cannot be considered “aggrieved” by a determination until they are aware of it. The court reversed the Appellate Division’s order and remitted the case for a hearing to determine when Biondo was informed of the appeal board’s decision, and clarified that because Biondo was found to have been a parole violator, which may have lasting consequences despite the expiration of his sentence, the proceeding was not moot.

    Facts

    Biondo was a parolee whose sentence expired while his appeal to the New York State Board of Parole was pending. The Board of Parole dismissed Biondo’s appeal as moot, presumably because his sentence had expired.

    Procedural History

    Biondo sought judicial review of the Parole Board’s decision via an Article 78 proceeding. The lower courts concluded that the four-month statute of limitations began to run immediately upon the issuance of the Parole Board’s determination, and thus dismissed the claim. The Court of Appeals reversed, finding that the statute of limitations did not begin to run until Biondo received notice of the Board’s determination.

    Issue(s)

    1. Whether the four-month statute of limitations for challenging an administrative determination begins to run upon the issuance of the determination, or upon the petitioner’s receipt of notice of the determination.

    2. Whether the proceeding was rendered moot after the sentence expired while the petitioner’s case was pending before the appeal board.

    Holding

    1. No, because the petitioner is not “aggrieved” by the determination until they receive notice of it.

    2. No, because the petitioner was found to have been a parole violator, which may have lasting consequences despite the expiration of his sentence.

    Court’s Reasoning

    The Court of Appeals reasoned that the four-month statute of limitations does not begin to run until the petitioner receives notice of the appeal board’s determination. The court stated, “the running of the statutory period began to run immediately upon the issuance of the determination, overlooks the additional requirement that the petitioner be ‘aggrieved’ by the determination.” The court referenced Matter of Martin v. Ronan, 44 NY2d 374, 381, and further explained, “We have previously held that for the purposes of the commencement of the statutory period, the petitioner cannot be said to be aggrieved by the mere issuance of a determination when the agency itself has created an ambiguity as to whether or not the determination was intended to be final.” The court found a similar principle should apply when the petitioner has received no notice. The Court emphasized fairness, stating, “fundamental fairness would seem to compel the conclusion that a petitioner should not be held to have been dilatory in challenging a determination of which he was not aware.” The Court held that the sentence expiring while the petitioner’s case was pending before the appeal board did not render the proceeding moot, since “petitioner was found to have been a parole violator which may have lasting consequences despite the expiration of his sentence.”