THE BREAKDOWN OF ATTORNEY CLIENT RELATIONSHIP

FRUHLING v. WESTREICH, 2020 NY Slip Op 32080 - NY: Supreme Court June 26, 2020:

"In motion sequence number 009, the law firm of Alonso, Andalkar & Facher, P.C. (AAF) moves to withdraw as counsel for plaintiff Adam Hochfelder and requests a 30-day to stay.

In support, AAF submits the affirmation of Mark J. Alonso, Esq. (NYSCEF Doc. No. [NYSCEF] 197, Affirmation of Alonso.) Alonso asserts that AAF and Hochfelder have "had major disagreements as to strategy, communications with Defendant's counsel, direction of AAF, and client conduct within the context of proceedings." (Id. ¶ 4.) Alonso further states that Hochfelder "has engaged two lawyers (Jed Rubenfeld, Esq. of Yale Law School and Michael Fruhling, Esq.) as respectively his `special counsel' and `private counsel' which has created a further irrevocable deterioration of the attorney-client relationship." (Id.) Additionally, Alonso asserts that Hochfedler "has failed, refused, or has been unable to compensate [AAF] for its time and the costs and disbursements incurred herein." (Id. ¶ 7.) Lastly, Alonso requests that pending the resolution of motion sequence number 008, the court should direct that the terms of December 13, 2019 Confidentiality Stipulation previously signed by the attorneys on behalf of the parties shall govern the treatment of any documents produced by any party or non-party in this case. (Id. ¶ 1.)

Hochfelder does not dispute that AAF has not been paid. (NYSCEF 215, Hochfelder Aff. ¶ 26.) Hochfelder appends the affirmation of his "personal" counsel Michael Fruhling whose role is allegedly "limited to acting as an intermediary between AAF and ... Hochfelder." (NYSCEF 214, Affirmation of Fruhling ¶ 4.) Despite being the "personal attorney" for Hochfelder, Fruhling admits that he nor his firm have been retained for this matter. (Id.) Hochfelder and Fruhling also argue that Hochfelder would be prejudiced if AAF were to withdraw at this juncture because Hochfelder "cannot possibly retain replacement counsel and bring them up to speed prior to ... the meeting with the Taxing Authorities. Nor will there be enough time for them to learn the facts of the case and argue the motions necessary to obtain production of the worksheets ... and comply with the NYS Department of Finance's timetable." (Id. ¶ 25.)

Alonso replies that Fruling was needed to serve as a mediator between Hochfelder and Hochfelder's retained counsel AAF because Hochfelder allegedly fired AAF several times after February 21, 2020. (NYSCEF 216, Second Affirmation of Alonso ¶ 6.) Apparently, Hochfelder fired AAF because he was not pleased with what appears to be AAF's reasonable explanation as to why AAF could not argue a particular motion if this court had not scheduled that motion for argument. (Id.) Nevertheless, Fruhling subsequently communicated to AAF that Alonso wanted AAF to continue representing Hochfelder in this matter. (Id. ¶ 8.)

In yet another bizarre turn of events, Alonso asserts in reply that this court should only make any decision permitting AAF leave to withdraw operative after this court decides motion sequence number 008. (Id. ¶ 15.) The reason is that AAF wishes to continue working on certain matters concerning motion sequence number 008. (Id. ¶ 14.) Indeed, Alonso states, "As much as I and my attorneys with [sic] to be done with this, we believe that the best result would be for us to complete the task for which we were hired — to obtain the explanatory documents and shepherd them safely to Plaintiff's accountant and then to the taxing authorities." (Id. ¶ 13.)

CPLR 321(2) provides, "An attorney of record may withdraw or be changed by order of the court in which the action is pending, upon motion on such notice to the client of the withdrawing attorney, to the attorneys of all other parties in the action or, if a party appears without an attorney, to the party, and to any other person, as the court may direct." "[A]n attorney may withdraw as counsel of record upon a showing of good and sufficient cause, and reasonable notice to the client." (Mason v MTA New York City Transit, 832 NYS2d 153, 154 [1st Dept 2017]).

AAF's requests to this court are contradictory. First, AAF requests permission to withdraw. Second, AAF wishes to continue for an indeterminate period of time ending when documents are delivered to the taxing authority. (NYSCEF 216, Second Affirmation of Alonso ¶ 13.) While AAF may wish to complete certain matters not yet resolved in connection with its representation of Hochfelder, it is clear to this court that continuing this attorney client relationship is impossible. The record demonstrates an attorney and client who are not able to communicate without an intermediary. Clearly, communication between attorney and client has broken down. The client is admittedly not compensating this attorney for its work.

Meanwhile, other attorneys are popping into this case without filing notices of appearances. CPLR 321(a) provides that a party may "prosecute or defend a civil action in person or by an attorney." However, where there is no appearance, an attorney lacks authority to make any motion on behalf of a party. (Worme v Merrill, 24 Misc 2d 1006, 1007 [Sup Ct, Nassau County 1960.) To the extent that a party appears by an attorney, such party may not act in person in the action except by consent of the court. (CPLR 321[a].) Here, neither Rubenfeld, nor Fruhling have filed a notice of appearance for Hochfelder. Until now, only AAF has filed an appearance and only AAF has had authority to represent Hochfelder. While there is legal authority that would recognize the email communications with this court by Rubenfeld (March 17, 18 and 23, 2020) and Fruhling (June 15, 2020) on behalf of Hochfelder as notices of appearance, the attorneys argue against such a reading. As Judge McLaughlin pointed out in his practice commentaries to McKinney's Consolidated Laws of N.Y., Book 7B [CPLR C320:1, p. 363] "(t)here is no express provision as to the contents of a notice of appearance. A notice from an attorney or even a litigant indicating a willingness to litigate any question in connection with the lawsuit should suffice, no matter what form it takes." (Viera v Uniroyal, Inc., 142 Misc 2d 1099, 1108 [Sup Ct, NY County 1988], aff'd, 148 AD2d 349 [1st Dept 1989].) This court prefers clear intent to represent a party.


Hochfelder shall represent himself unless an attorney files a notice of appearance. The court will not recognize or give attention to any communications by attorneys on behalf of Hochfelder unless that attorney has filed with the court in NYSCEF a notice of appearance in this case."

STD AND THE LAW

JI YOUNG CHUNG v. GULRAJANI, 2020 NY Slip Op 32386 - NY: Supreme Court July 20, 2020:

"Plaintiff commenced this action alleging that defendant knowingly and intentionally transmitted genital warts and the Human Papalova Virus ("HPV") to her. Defendant denies plaintiff's accusations asserting that it is impossible for him to have knowingly transmitted these conditions because he does not and has not ever had them.

Defendant moves to dismiss the complaint, pursuant to CPLR 3211(a)(1), on the grounds that the action is barred by documentary evidence, and pursuant to CPLR 3211(a)(7) asserting that plaintiff's allegations do not state a cognizable cause of action.

In support of his motion, defendant argues that the complaint relies on bare legal conclusions as to the elements of the causes of action, as those conclusions contradict indisputable scientific principles and fact.

Plaintiff's first cause of action is negligence. Plaintiff asserts that transmission of a sexual transmitted disease (STD) is grounds to support claims of negligence and fraud. She claims that her negligence cause of action is based on defendant's transmission of HPV and genital warts to her and that her claim is further supported by the specific facts alleged in the complaint.

The complaint states that plaintiff was a virgin when she first met defendant in July 2017. They first engaged in unprotected sex in December 2017. Prior to that encounter, she had not exhibited any symptoms of, or never had been diagnosed with an STD. The complaint asserts that she asked defendant if he had an STD and lie denied having one. They continued to engage in unprotected sex from December 2017 through February 2018.

In January 2018, plaintiff states that she saw a prescription in defendant's apartment and did not know what it was. At that time, she also observed genital waits on defendant's penis, but did not know if they were transmittable. Plaintiff argues that these undisputed facts are sufficient to support the allegations in her complaint and preclude dismissal.

Defendant argues that plaintiff's claims fail to assert facts in support of any element of her claim of negligence. He argues that her claims do not show that he owed a duty to plaintiff, that he breached that duty and that she suffered damages as a result of said breach. Defendant further asserts that the complaint does not show that his alleged negligence was a proximate, or legal cause of the event that produced the harm allegedly sustained by plaintiff.

Defendant further argues that plaintiff's alleged injuries were neither foreseeable nor knowable to him because, as defendant it is a factual impossibility for him to know that he had or has HPV. Defendant avers that, according to Planned Parenthood and the Centers for Disease Control ("CDC"), there is no medical test which can diagnose a male human for HPV. Defendant states that plaintiff's claims are contradicted by the documentary evidence and do not show that his alleged negligence was a proximate or legal cause of the event that produced plaintiff's harm. In addition, defendant asserts that plaintiff's cause of action for fraudulent inducement cannot stand, as that there is no proof that he knowingly misrepresented a material present fact, intended to deceive and induce her to act on it which resulted in an injury.

Defendant further states that plaintiff possesses his HIPPA forms, which show that he has never been diagnosed with either genital warts or HPV. Defendant further states that plaintiff's injury does not exist, as her medical records show that she is not a carrier of the two types of HPV which cause cancer.

Defendant also argues that in New York, it is well settled in cases involving an alleged sexually transmitted disease or infection, that an affirmative legal duty to disclose has only been held to exist in cases where a party's medical records show that the party has been diagnosed with HPV or genital warts. Maharam v. Maharam, 123 AD3d 165 [1st Dept. 1986]. Thus, defendant states that if one could not know that one carries around the HPV or genital waits it is impossible for one to foresee the risk of harm of transmitting the HPV or genital wafts.

Defendant states that there is no proof that he caused her ailments, as HPV can be spread by means other than sex. According to the American Cancer Society, HPV can also be spread by skin to skin contact with the area of the body infected with HPV and that there may be other ways to become infected that aren't yet clear and that having HPV does not mean that a person will get cancer.

Plaintiff opposes the motion arguing that transmission of a sexual transmitted disease ("STD") is grounds to support claims for negligence and fraud. Specifically, defendant knew that he had genital watts and should have informed her of their possible physical effects to her body. In addition to outlining her non-existent sexual history prior to her unprotected encounters with defendant and the fact that she was never diagnosed with an STD, meet the standard to survive defendant's motion.
Plaintiff also argues that the uncertified medical records submitted in support of defendant's motion do not support the kind of documentary evidence that would support a CPLR 3211(a)(1) motion. Specifically, plaintiff asserts that the documents are not in admissible form and that none of the documents refute any of the claims in the complaint.

When a party brings moves to dismiss a complaint based on documentary evidence, pursuant to CPLR 3222(a)(1), that motion will only be granted where the documentary evidence refutes the plaintiff's factual allegations, establishing a defense as a matter of law. The documents must flatly contradict allegations or conclusively establish defense as a matter of law. Goshen v. Mutual Life Ins. Co. of New York, 98 NY2d 314 (2002). If the court doesn't find the submissions "documentary", the motion must be denied.

Contrary to movants assertions, plaintiff's allegations state a cognizable cause of action. Plaintiff correctly states that the transmission of an STD does support claims of negligence and fraud. In addition, the items submitted, by defendant, in support of the motion are not such that resolve all of the pertinent issues in this case. Each item; the plaintiff's medical chart of Dr. Wong, defendant's health insurance payment record, and defendant's Urgent Care receipt do not go the heart of plaintiff's claim, which alleges defendant's negligence in the transmission of an STD. The items do not show that defendant did not transmit the HPV virus to plaintiff. In fact, they raise questions as to whether the items are relevant to this case. Although this is not a motion for summary judgment, wherein the count must decide if issues of fact exist warranting a decision by the trier of fact, the items submitted by the movant raise questions about his defense and the arguments made by plaintiff show that dismissal of this complaint is not warranted."

UNEMPLOYMENT INSURANCE - WHEN YOU HAVE TWO JOBS

About 13 million American workers have more than one job, because either they need extra income or they want to gain more experience or explore different interests.

MATTER OF VARGAS v. MASON ESC LLC, 2020 NY Slip Op 4220, NY: Appellate Div., 3rd Dept. July 23, 2020:

"Claimant was employed part time as a medical assistant by the employer at its ambulatory surgical center for about one year. She initially began her shift at 7:00 a.m., but her hours were changed to permit her to begin work at 8:00 a.m. at her request, and she thereafter worked Wednesdays and Fridays from 8:00 a.m. until 3:00 p.m. Claimant was also employed at an ophthalmology office also owned by the employer but operated as a separate entity under a different employer identification number. On July 28, 2018, claimant met with her supervisors at the surgical center and was admonished in writing for tardiness and absenteeism in that position. Claimant indicated to her supervisors that she could not arrive by the scheduled start time at the surgical center and voluntarily separated from that position, but continued to work in her other position at the office, which began at 8:30 a.m.^[1] After claimant's application for unemployment insurance benefits was granted, the employer requested a hearing, contending that claimant should be disqualified from receiving benefits because she had voluntarily quit her employment at the surgical center without good cause.

A hearing was held at which claimant failed to appear and the employer's administrator offered uncontradicted testimony. The Unemployment Insurance Appeal Board ultimately ruled that, although claimant had "voluntarily separated" from her part-time surgical position, she continued in her other office position and, thus, her separation was under nondisqualifying circumstances and she was eligible for benefits. The Board relied on the principle that "the Unemployment Insurance Law does not require a claimant to work two jobs concurrently to establish eligibility for benefits," and that a claimant who quits a part-time job, while still employed at another job, has quit under nondisqualifying circumstances." The employer appeals.

The employer argues that claimant is ineligible for unemployment insurance benefits because she voluntarily separated from her surgical position without good cause, whereas claimant argues that she had good cause for her separation. "Whether a claimant has voluntarily left his or her employment without good cause is a factual issue for the Board to resolve and its decision will be upheld if supported by substantial evidence" (Matter of Xavier [Commissioner of Labor], 172 AD3d 1812, 1813 [2019] [internal quotation marks and citations omitted]). Here, however, the Board never ruled on whether claimant had good cause to leave her position with the employer, only finding that she had "voluntarily separated" from that position. Rather, the Board based its ruling on the fact that claimant, after leaving her position at the surgical center, continued her concurrent employment, which it found rendered her separation nondisqualifying. Given that "[j]udicial review of an administrative determination is limited to the grounds invoked by the agency and a reviewing court which finds those grounds insufficient or improper may not sustain the determination by substituting what it deems to be a more appropriate or proper basis," our analysis will only address the grounds relied upon by the Board (Matter of Parkmed Assoc. v New York State Tax Commn., 60 NY2d 935, 936 [1983]; see Matter of Scherbyn v Wayne—Finger Lakes Bd. of Coop. Educ. Servs., 77 NY2d 753, 758 [1991]; Matter of Tarasek [Commissioner of Labor], 44 AD3d 1204, 1205 [2007]).

In finding claimant eligible for benefits, the Board relied upon three of its prior decisions in which claimants had two concurrent jobs, quit one of the jobs under what were deemed nondisqualifying conditions and, as a result, were found to be eligible for benefits. However, each of these decisions are readily distinguishable from the circumstances presented here. In the first cited decision, the Board made an express finding that the claimant had voluntarily separated from his employment with good cause, in contrast to the Board's decision here (Matter of Appeal Board Decision No. 585851, https://uiappeals.ny.gov/system/files/documents/585851-appeal-decision.pdf [June 24, 2015] [the claimant quit his job because the work schedule conflicted with a second, part-time job; the claimant was eligible for benefits]). In the second cited decision, the Board held that where a claimant quit one of two jobs for health reasons and not for the purpose of collecting benefits, his employment ended under nondisqualifying circumstances and he was entitled to benefits, reversing a finding that he had quit without cause (Matter of Appeal Board Decision No. 564564, https://uiappeals.ny.gov/system/files/ documents/564564-appeal-decision.pdf [Jan. 9, 2013]). Similarly, in the third cited decision, the Board held that where a claimant quit a part-time job and continued to work in her full-time job, from which she was later unexpectedly laid off, her part-time employment ended under nondisqualifying circumstances, and she was entitled to benefits, reversing a finding that she had quit without good cause (Matter of Appeal Board Decision No. 565000, https://uiappeals.ny.gov/system/files/documents/565000-appeal-decision.pdf [Sept. 21, 2012]). Thus, the cited decisions fail to support claimant's entitlement to benefits here.

Although the Board decisions hold that a claimant is not required to work two jobs concurrently in order to be eligible for benefits, this does not mean that every claimant who works two jobs and quits one of them is automatically entitled to benefits. Entitlement to benefits does not turn on the existence or number of concurrent positions held but, rather, on the circumstances of the separation. Ordinarily, one who voluntarily separates without good cause is disqualified from receiving benefits (see Labor Law § 593[1][a]; Matter of Gruber [New York City Dept. of Personnel-Sweeney], 89 NY2d 225, 228, 232-233 [1996]; Matter of Franklin [Commissioner of Labor], 141 AD3d 1067, 1068 [2016]); the fact that a person continues in what had been a concurrent job does not automatically make him or her eligible for benefits for the employment terminated without cause.
Whether a claimant left the first position with or without cause may affect later entitlement to benefits for the second position (see Matter of Rose [Commissioner of Labor], 19 AD3d 752, 753 [2005]). The Board did not cite, and we are unable to find, authority for the rule applied by the Board here.

Accordingly, we do not find substantial record evidence to support the Board's determination.

ORDERED that the decision is reversed, without costs, and matter remitted to the Unemployment Insurance Appeal Board for further proceedings not inconsistent with this Court's decision.


[1] The record and the decision of the Unemployment Insurance Appeal Board are not clear as to the hours and days that claimant worked at the office position while concurrently working at the surgical center. Both claimant's brief and the employer's brief indicate that she worked part time at the office on the remaining days of the week. Also, the record does not reflect what hours she worked at the office after departing from the surgical position; the employer's counseling form indicates that the plan after her departure from the surgical center was for claimant to work 8:30 a.m. to 4:00 p.m. at the office but it does not indicate the number of days to be worked. There is no support in the record for the finding that claimant worked full time for the office after quitting the surgical center."

AFTER TROPICAL STORM ISAIAS - SOME "TREE" LAW

Looking outside after the storm stopped...the many fallen trees.

Russo v. Jay, 2020 NY Slip Op 50157 - NY: Appellate Term, 2nd Dept. January 3o, 2020:

"Plaintiffs commenced this small claims action against defendant, the owner of property abutting plaintiffs' property, to recover for damage that plaintiffs sustained after a limb from a tree, which was allegedly on defendant's property, fell into plaintiffs' yard in April of 2018, damaging their fence. Defendant counterclaimed to recover damages resulting from plaintiffs' workers trespassing on his property.

At a nonjury trial, plaintiffs testified that, in 2016, debris from a tree on defendant's property had fallen into their yard and damaged their pool fence. They had sent defendant a certified letter in 2016, informing defendant that he had several dead trees on his property, which represented a hazard to plaintiffs' property, but defendant did not accept the letter. Plaintiffs offered photographs taken in 2016 to support their position that the trees in defendant's yard had been in a deteriorated condition. Defendant asserted, among other things, that, in 2016, the debris from the tree fell as a result of an "act of God," and that plaintiffs had not shown that a dangerous condition existed in 2018 or that defendant had had notice of such a condition. As limited by the brief, defendant appeals from so much of a judgment of the Justice Court as awarded plaintiffs the principal sum of $568.67.
In a small claims action, our review is limited to a determination of whether "substantial justice has . . . been done between the parties according to the rules and principles of substantive law" (UJCA 1807; see UJCA 1804; Ross v Friedman, 269 AD2d 584 [2000]; Williams v Roper, 269 AD2d 125 [2000]).

To establish defendant's liability, plaintiffs bore the burden of demonstrating, among other things, that a defective condition existed and that defendant had affirmatively created the condition, or had actual or constructive notice of its existence (see Skalafuris v Arpadi, 43 Misc 3d 128[A], 2014 NY Slip Op 50484[U] [App Term, 2d Dept, 9th & 10th Jud Dists 2014]). "Constructive notice that a tree or limb is dangerous may be based upon signs of decay or other defects that are readily observable by someone on the ground or that a reasonable inspection would have revealed" (Babcock v County of Albany, 85 AD3d 1425, 1426 [2011]; see Ivancic v Olmstead, 66 NY2d 349, 351 [1985] [the manifestation of a tree's "decay must be readily observable in order to require a landowner to take reasonable steps to prevent harm"]; Michaels v Park Shore Realty Corp., 55 AD3d 802 [2008]; Lillis v Wessolock, 50 AD3d 969 [2008]). There is no duty to consistently and constantly check for non-visible decay. Although plaintiffs testified that debris had fallen from defendant's overhanging tree limbs in the past and that they had sought to advise defendant of that on one occasion two years earlier, they failed to provide any evidence that the particular tree from which the limb fell onto their property in 2018 was unhealthy or that defendant had actual or constructive notice of any defect in that tree. Thus, we conclude that plaintiffs failed to make out a prima facie case (see Skalafuris v Arpadi, 43 Misc 3d 128[A], 2014 NY Slip Op 50484[U]; Rosenbaum v Mount Hebron Cemetery, 42 Misc 3d 147[A], 2014 NY Slip Op 50366[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2014]; see also Goldman v Severe, 31 Misc 3d 151[A], 2011 NY Slip Op 51124[U] [App Term, 2d Dept, 9th & 10th Jud Dists 2011]).

In any event, even if the testimony had established that the tree limb fell from defendant's rotted tree and that it was the overhanging limb that plaintiffs had previously complained to defendant about in 2016, plaintiffs failed to avail themselves of their right to self-help by pruning the tree branches to the extent that they were overhanging plaintiffs' property (see Kuney v Christian, 42 Misc 3d 136[A], 2014 NY Slip Op 50120[U] [App Term, 2d Dept, 9th & 10th Jud Dists 2014]; Hileman-Rizzo v Krysty, 10 Misc 3d 135[A], 2005 NY Slip Op 52118[U] [App Term, 2d Dept, 9th & 10th Jud Dists 2005]; see also 1 NY Jur 2d, Adjoining Landowners § 65). In view of the foregoing, we find that the judgment in favor of plaintiffs failed to render substantial justice between the parties according to the rules and principles of substantive law (see UJCA 1804, 1807)."

COLLECTING ATTORNEY FEES?

Then comply with Part 137 arbitration rules.

FILEMYR v. Hall, 2020 NY Slip Op 4238 - NY: Appellate Div., 1st Dept. 2020:

This action presents a question of first impression for this Court. Indeed, there appears to be very few cases which have addressed the issue presented.

We find that Supreme Court properly dismissed the action. Supreme Court correctly concluded that, by waiting to provide notice of right to arbitrate more than two years after legal services had been rendered, plaintiff deprived defendants of the right to arbitrate, and thus violated 22 NYCRR 137 (see e.g. Pascazi Law Offs., PLLC v Pioneer Natural Pools, Inc., 136 AD3d 878, 879 [2d Dept 2016], lv dismissed and denied 27 NY3d 1047 [2016]); Julien v Machson, 245 AD2d 122 [1st Dept 1997].

22 NYCRR 137 gives clients the right to demand arbitration of any fee dispute in an amount between $1,000 and $50,000 (22 NYCRR 137.1[b][2]). The failure of an attorney to participate in fee arbitration is a violation of the ethical rules (Rules of Professional Conduct 22 NYCRR 1200.00) rule 1.4; (see 22 NYCRR 137.11). 137.1 sets out the limitations on the disputes that will be heard by the Committee. This includes matters outside the dollar range, claims inextricably intertwined with malpractice claims, and as relevant here, claims where no legal services have been performed in the prior two years (22 NYCRR 137.1[b][6]).

In Borah, Goldstein, Altschuler, Schwartz, & Nahins, P.C. v Lubnitzki (13 Misc 3d 823, 826 [Civ Ct, NY County 2006]), plaintiff commenced an action for fees more than two years after legal services had been rendered. Plaintiff ultimately obtained a default judgment for the fees. Defendant successfully moved to vacate the default and, in her answer, pleaded an affirmative defense that plaintiff had not complied with Part 137. The court granted plaintiff leave to amend its complaint. In its amended complaint, plaintiff then alleged that Part 137 was inapplicable because it was more than two years since legal services had been rendered.

In rendering its decision, the court reasoned that 22 NYCRR 137 reflects an administrative preference for arbitrators and mediators to decide disputes which have not become stale. "[T]hose responsible for establishing the Part could not have intended that the mere passage of time warrants litigation in court, and thus, it ought not cure [a] plaintiff's initial failure to notify defendant of [their] right to arbitrate or mediate fee disputes" (id. at 826). The court sua sponte dismissed the action stating that:

"plaintiff ought not be permitted to seek refuge from a dismissal despite the two years that passed before it amended its complaint solely to allege an exemption that was inapplicable when it first brought the action. To permit plaintiff the benefit of the exemption in these circumstances would give insufficient consideration to the [Part 137's] intent that clients be given notice of the availability of arbitration and mediation, something that was concededly not done here" (id at 826).

Fee arbitration is mandatory if requested by a client or a former client. It is a right of the client. Where, as in this case, an attorney, through their own delay deprives the client of that right, the attorney cannot in good faith claim compliance with the procedures of Part 137. Not only would this effectively give counsel the option of whether to arbitrate, because counsel could control whether the dispute began in two years or less, it would also be directly contrary to the rules, which provide that it is the client's choice.

Plaintiff also argues that missing the two-year deadline did not necessarily bar arbitration, because the Committee determines whether a dispute is within the ambit of Part 137. Again, this argument ignores the right of the client to decide whether or not to arbitrate as it would leave it to the discretion of attorneys whether to provide the notice of right to arbitrate (see Lorin v 501 Second St., 2 Misc 3d 646, 649 [Civ Ct, Kings County 2003]). In Lorin, plaintiff brought suit without complying with Part 137. Defendants asserted a counterclaim for malpractice, as well as for failure to comply with Part 137. Plaintiff argued that his failure to comply was harmless, because malpractice claims were excluded from arbitration, and defendants had asserted plaintiff's malpractice as an affirmative defense. The court reasoned that it was the client's choice to either have a streamlined process for the fee dispute and forgo the malpractice claim or choose to assert malpractice and litigate. As the court noted, "it is for the Local Administrative Body,' not the lawyer, to make the determination that the defense of malpractice is inextricably intertwined with the plaintiff's claim for payment, and then issue a letter declining jurisdiction and giving the attorney the right to sue,' after first evaluating the case" (id. at 649).


Supreme Court properly declined to dismiss the affirmative defenses of laches, waiver and unclean hands. Plaintiff's violation of Part 137 constituted unethical conduct sufficient to constitute unclean hands (see National Distillers & Chem. Corp. v Seyopp Corp., 17 NY2d 12, 15 [1966]). The loss of the right to arbitrate that resulted from plaintiff's delay sufficiently supported the defense of laches (see Matter of Linker, 23 AD3d 186, 189 [1st Dept 2005]). Finally, by the aforementioned conduct, we find that plaintiff waived his right to initiate an action in court (Jefpaul Garage Corp. v Presbyterian Hosp. in City of N.Y., 61 NY2d 442, 446 [1984]).

TERMINATING A COMMERCIAL MONTH TO MONTH TENANCY

The "Housing Stability and Tenant Protection act of 2019" offers some additional defenses and protections to both commercial and residential tenants but not all apply to commercial leases.

Aviv Dev. Corp. v. Weathers, NYLJ July 29, 2020, Date filed: 2020-07-16, Court: Civil Court, Queens ,Judge: Judge Sally Unger, Case Number: 50385/20;

"Upon the foregoing cited papers and after oral argument, the Decision/Order on the pre-answer motion to dismiss the petition, is as follows: Aviv Development Corp., (hereinafter “Aviv” or “petitioner”) is the owner of the commercial premises located at 107-21 Guy R. Brewer Boulevard, Jamaica, NY 11433 (hereinafter “subject premises”). Respondent Neal Weathers (hereinafter “Weathers” or “respondent”) is the commercial tenant of the subject premises. The parties did not execute a written lease for the subject premises, but rather established a month to month tenancy which undisputedly commenced approximately ten years ago. The petitioner served the respondent with a thirty-day notice of termination (hereinafter “NOT”) and commenced the instant holdover summary eviction proceeding thereafter.

On January 8, 2020, the petitioner commenced the instant holdover summary eviction proceeding against the respondent seeking a judgment of possession, a money judgment, and related relief. The notice of petition and petition were served on January 13, 2020. Respondent’s pre-answer motion was served and filed with the court on March 5, 2020, in accordance with the schedule set by the Court.
The instant motion is premised upon an alleged notice requirement pursuant to Real Property Law §232-a, which provides that, regarding tenancies within the City of New York,

No monthly tenant, or tenant from month to month, shall hereafter be removed from any lands or buildings in the city of New York on the grounds of holding over the tenant’s term unless pursuant to the notice period required by subdivision two of section two hundred twenty-six-c of this article, or for a tenancy other than a residential tenancy at least thirty days before the expiration of the term, the landlord or the landlord’s agent serve upon the tenant, in the same manner in which a notice of petition in summary proceedings is now allowed to be served by law, a notice in writing to the effect that the landlord elects to terminate the tenancy and that unless the tenant removes from such premises on the day designated in the notice, the landlord will commence summary proceedings under the statute to remove such tenant therefrom. (Emphasis supplied)

The issue raised by respondent is whether a landlord of a commercial tenant in occupancy as a month to month tenant in excess of two years is required to serve a 90 day NOT prior to commencing a summary eviction holdover proceeding, rather than the 30 day NOT employed in the case at bar.
Respondent relies upon the statute’s reference to RPL §226-c as the measure of the amount of notice required to be afforded to residential tenancies in its effort to apply RPL §226-c to commercial tenancies. The amount of notice required in RPL §226-c is a progressive measure based upon the length of time of a tenant’s occupancy. Respondent seems to view the interplay of the two statutes as a means to latch onto the more generous notice given to residential tenants and utilize it for commercial tenancies.

Respondent’s basic theory is that based upon the awkward wording of the statute, that provision of the RPL pertains to commercial tenancies as well as residential ones. Respondent argues that the commencement of the sentence with the phrase “No monthly tenant” does not allow for an exception to that general application of the statute. Respondent also discusses the diction of the statute at length and criticizes the Legislature for its placement of the word “or”. According to respondent’s premise, where a term stating an absolute begins a sentence, a qualifier or exception cannot follow in the same sentence, or if it does, it must be ignored or viewed as an ambiguity at best. Respondent asserts that the wording of the statute created an ambiguity and the “plain language” of the statute must lead to the conclusion that there is no restriction on its applicability.

The petitioner takes the position that the legislative history is relevant to the intent behind the enactment of the statute. From the historical perspective, the petitioner posits that the New York State Standing Committee on Housing, Construction and Community Development, the group that proposed the bill, made clear in their annual report of 2019 that certain amendments such as RPL §232-a were drafted for all residential tenants. Petitioner contends that the intent of the Legislature was to provide increased notice provisions for residential tenants only.

While respondent’s interpretation of RPL §232-a is creative, it is simply not valid. The Court does not recognize any alleged ambiguity raised by respondent. To follow respondent’s reasoning, none of the provisions of the 2019 new statutory scheme should apply to commercial tenancies, because the title of the act is literally “Housing Stability and Protections Act”. Based upon the respondent’s reasoning, the respondent’s necessary conclusion, based upon the title of the entire act, would preclude application of any portion of it to commercial tenancies, because there is no reference to commercial tenancies in the title. Clearly, this is not so. The Legislature drafted some provisions which apply to all tenancies and others that only are applicable in residential ones.

RPL §232-a merely contains what is referred to as a “carve out” for commercial tenancies. While the opening of the sentence refers to all month to month tenancies in the City of New York as requiring the amount of notice set forth in RPL §226-c (i.e. a minimum of 30, 60 or 90 days depending on the length of the tenancy), the statute then carves out commercial tenancies as an exception in which a 30 day notice is sufficient, regardless of the length of time of the tenant’s occupancy. There is nothing ambiguous about it.

Moreover, RPL §226-c, which provides the various time frames for service of the NOT based upon length of tenancy, specifically discusses residential tenancies. The title of the section is “Notice of rent increase or non-renewal of residential tenancy”. The first paragraph of the statute refers to renewal of “the tenancy of an occupant in a residential dwelling unit”. The second paragraph of that statute opens with a discussion of the “cumulative amount of time the tenant has occupied the residence”. RPL §226-c is wholly inapplicable to all commercial month to month tenancies.

Conclusion

The wording of RPL §232-a is crystal clear. Reference to legislative intent is not necessary in this circumstance, because there is no ambiguity in the wording of the statute. The intertwining of RPL §232-a with RPL §226-c to determine the appropriate measure of time to serve a NOT is limited to residential tenants. Landlords of commercial month to month tenants in New York City are not required to serve a NOT 60 or 90 days in advance of termination. A 30 day NOT suffices.
The respondent’s motion is denied. Respondent shall have 10 days from the date of this decision to serve and file his answer."

EMAIL SETTLEMENT CAN BE BINDING

Was there a deal or just "buyers remorse"?

McCalla v. LIBERTY LIFE ASSURANCE COMPANY OF BOSTON, Dist. Court, ED New York, February 6, 2020:

"A. Procedural Posture of the Case

Plaintiff Hensley K. McCalla ("Plaintiff"), represented by counsel, commenced this action in the New York State Supreme Court, County of Nassau, asserting a claim for disability benefits against the defendant Liberty Life Assurance Company of Boston ("Defendant"). (ECF No. 1.) Defendant asserted that the claims were preempted by ERISA, 29 U.S.C. §§ 1001, et seq., and removed the case to Federal Court on April 2, 2018. (Id.) It was assigned to District Court Judge Sandra J. Feuerstein. Plaintiff filed an amended complaint and Defendant responded with an answer and counterclaims, alleging an overpayment of disability benefits. (ECF Nos. 10, 11.)

At a status conference before Judge Feuerstein on July 23, 3018, the parties discussed discovery deadlines and a date by which to serve dispositive motions. (ECF No. 16.) Approximately two months later, defense counsel wrote jointly with plaintiff's counsel to notify the Court that the parties "have reached an agreement in principle," and to request that the Court vacate all deadlines pending submission of the dismissal paperwork. (ECF No. 17.)

The Court granted this request and marked the case closed. (Electronic Order, 9/27/18.) On November 1, 2018, plaintiff's counsel moved to withdraw as counsel for Plaintiff, citing irreconcilable differences, a request which Judge Feuerstein denied. (ECF No. 17.) On December 21, 2018, Defendant filed a fully briefed "Motion for Settlement," asserting that the parties had entered into a binding settlement agreement and asking the Court to enforce that settlement. (ECF Nos. 21-26.) The filing included a Memorandum in Opposition filed by plaintiff's counsel. (ECF No. 24.)
While the Motion for Settlement was pending, Plaintiff, proceeding — pro se, filed an identical action in New York State Supreme Court, Nassau County, which Defendant again removed to Federal Court and then requested it be consolidated with the instant action. (See ECF Nos. 29, 30.) Judge Feuerstein consolidated the second-filed case (Docket 19-cv-4180) with the instant case, which she reopened. (Electronic Order, 7/25/2019.)

A few weeks later, plaintiff's counsel moved to be relieved as counsel for the second time, including a signed stipulation from Plaintiff indicating that he would proceed pro se. (ECF Nos. 36, 37.) Judge Feuerstein granted this request and scheduled a conference. (Electronic Order 8/21/2019.) Plaintiff appeared pro se before Judge Feuerstein on October 8, 2019 and the case was reassigned to the undersigned on October 15, 2019. (ECF No. 39.) The undersigned reviewed the pending motion papers and scheduled a conference for February 4, 2020 to address the requested relief, at which time the Court granted Defendant's Motion for Settlement. (ECF No. 40.)

B. Settlement Discussions and Agreement

According to the papers submitted with the Motion for Settlement, plaintiff's counsel made an initial settlement offer to defense counsel via email on June 28, 2018. (Sibbernsen Decl., Ex. A., ECF No. 23.) He then made three revised settlement offers on July 20, 2018, September 13, 2018, and September 14, 2018. (Sibbernsen Decl., Exs. A, B, C.) In each email he stated, "[a]fter further discussion with our client, we have revised our settlement offer" and noted that the parties had agreed that the settlement would also waive Defendant's claims against Plaintiff.^[1] (Id.) Following the September 14, 2018 offer, defense counsel countered, stating "[i]n exchange for a release of all claims and an agreement to usual and customary terms of a settlement agreement (including confidentiality and non-disparagement), my client offers to waive its counterclaim against Mr. McCalla (approx. $35K) and pay Mr. McCalla an additional $9,000." (Sibbernsen Decl., Ex. D.) Later that same day, plaintiff's counsel reduced the demand amount. (Id.) Three days later, on September 17, 2018, plaintiff's counsel stated, "Mr. McCalla will accept $12,500.00. This is our best and final offer." (Id.)

The next morning, defense counsel indicated that his client would accept the demand of $12,500.00 and waive its counterclaims in exchange for a release of all claims and agreement to usual and customary terms of a settlement agreement. (Id.) He indicated that he would draft a settlement agreement, asked to whom the settlement check should be made out, and requested an executed Form W-9 for plaintiff's counsel's firm. (Id.) An hour and a half later, plaintiff's counsel responded with the signed W-9 and stated that the settlement check should be payable to his firm, as attorney. (Id.) Approximately a week later, defense counsel asked if he could submit the letter notifying the Court of the settlement, to which plaintiff's counsel responded, "Letter is fine." (Id.)

Over the next few weeks, defense counsel asked clarifying questions about the preferred designation for the settlement check and sent a settlement agreement. (Sibbernsen Decl., Ex. E.) He followed up with plaintiff's counsel about the status of the settlement agreement on October 19, 2018, and plaintiff's counsel responded, "I expect my client in next week." (Id.)

According to subsequent email exchanges, plaintiff's counsel then informed defense counsel that Mr. McCalla intended to back out of the settlement agreement and defense counsel stated, by email, Defendant's position that the parties entered into a binding settlement agreement reflected in their email exchanges. (Sibbernsen Decl., Ex. F.) Plaintiff's counsel contended it was not a binding settlement agreement because the emails stated, "FOR SETTLEMENT PURPOSES ONLY WITHOUT PREJUDICE — NOT TO BE USED IN LITIGATION" and the letter to the Court indicated that the settlement had been reached only "in principle." (Id.)

DISCUSSION

The Court has considered the parties' motion papers together with the statements made on the record at the Conference.^[2] The Court first addresses counsel's authority to enter into the settlement agreement. "[B]ecause of the unique nature of the attorney-client relationship, and consistent with the public policy favoring settlements, we presume that an attorney-of-record who enters into a settlement agreement, purportedly on behalf of a client, had authority to do so. In accordance with that presumption, any party challenging an attorney's authority to settle the case . . . bears the burden of proving by affirmative evidence that the attorney lacked authority." Pereira v. Sonia Holdings (In re Artha Mgmt.), 91 F.3d 326, 329 (2d Cir. 1996).

In its opening brief, Defendant argued that plaintiff's counsel had authority to settle on behalf of Plaintiff. (ECF No. 22.) Plaintiff was still represented by counsel when he opposed the motion and his opposition papers did not contest this argument. (ECF No. 24.) Accordingly, any such claim is waived. However, at the Conference, Plaintiff claimed for the first time that his counsel did not have his authority to settle for $12,500.00. Even if this claim was not waived by failing to raise it in his motion papers, the Court does not find Plaintiff's statement credible, particularly given the email exchanges between counsel and the lack of opposition to Defendant's actual authority argument in the papers submitted to the Court.

Next, to determine if the settlement agreement was binding, "[t]he court is to consider (1) whether there has been an express reservation of the right not to be bound in the absence of a writing; (2) whether there has been partial performance of the contract; (3) whether all of the terms of the alleged contract have been agreed upon; and (4) whether the agreement at issue is the type of contract that is usually committed to writing." Winston v. Mediafare Entm't Corp., 777 F.2d 78, 80 (2d Cir. 1985). No single factor is dispositive. Id. Based on these factors, the Court finds that the parties entered into a binding settlement agreement. The Court is particularly persuaded by the case Pruiett v. City of New York, 2012 U.S. Dist. LEXIS 103793 (S.D.N.Y. May 31, 2012), which presents a very similar set of facts. The arguments raised by Plaintiff in his opposition papers, or on the record at the Conference, do not persuade the Court otherwise. Notably, at the Conference, Plaintiff did not contest any terms of the settlement other than the settlement amount—his only defense to the Motion for Settlement was that he did not want to settle the case for $12,500.00, which was clearly agreed to in the email exchanges.

Accordingly, the Court GRANTS Defendant's Motion for Settlement, (ECF No. 21), and finds that the parties agreed to settle this action for a sum of $12,500.00 to be paid by Defendant to Plaintiff which will release all claims and counterclaims in this consolidated action. Defendant shall issue a check made payable to Plaintiff for the full settlement amount by March 5, 2020 (30 days from the date of the conference), at which time the releases shall become effective.

CONCLUSION

As this matter has settled, the case is dismissed. The Clerk of the Court is directed to mail a copy of this order to Plaintiff at his last known address and to mark this case closed.
SO ORDERED.
[1] The Court notes that the July 20, 2018 email did not include the word "further." (Sibbernen Decl., Ex. A.)

[2] The Court rejects Plaintiff's argument that it lacks jurisdiction over the Motion for Settlement. (See ECF No. 24 at 10-12.) The enforceability of the settlement is properly before the Court in the instant action, which was removed to this Court on April 2, 2018. Moreover, even if it were not, the Court would have jurisdiction to address the enforceability of the settlement as part of the newly-filed identical case, 19-cv-4180-SJF-SIL, which already has been consolidated into the instant action."

MORTGAGE FORECLOSURE - EFFECT OF BANK'S DELAY

A balancing of interests.

Chase Home Fin., LLC v Berger, 2020 NY Slip Op 04289, Decided on July 29, 2020, Appellate Division, Second Department:

"In March 2004, Abraham Berger (hereinafter the defendant) borrowed the sum of $300,000 from the plaintiff's predecessor in interest. The loan was evidenced by a note and secured by a mortgage on certain real property located in Spring Valley. In October 2009, the plaintiff commenced this action against the defendant and others alleging, inter alia, that the defendant defaulted in his payment obligations under the note and mortgage.

In August 2010, the plaintiff obtained a default judgment of foreclosure and sale against the defendant. Four years later, the plaintiff attempted to enforce the judgment of foreclosure and sale by moving, inter alia, for leave to substitute the affidavit of merit. The Supreme Court granted the motion in an order dated February 20, 2015. Thereafter, the defendant moved to vacate, among other things, an order of reference dated April 6, 2010, and the judgment of foreclosure and sale, and pursuant to CPLR 3211(a) to dismiss the complaint insofar as asserted against him on the ground, inter alia, that he had never been served with the summons and complaint. In late 2017, the plaintiff moved, among other things, pursuant to CPLR 306-b to extend the time to serve the defendant with the summons and complaint.

After the plaintiff admitted that its original affidavit of service was erroneous and failed to produce its process server when the parties appeared for a hearing to determine the validity [*2]of service of process, the Supreme Court denied the plaintiff's motion and granted the defendant's motion, inter alia, to dismiss the complaint insofar as asserted against him. The plaintiff now appeals and argues, among other things, that the court should have granted its motion in the interest of justice.

CPLR 306-b provides, in relevant part, that "[s]ervice of the summons and complaint . . . shall be made within one hundred twenty days after the commencement of the action." CPLR 306-b further provides that, "[i]f service is not made upon a defendant within the time provided in this section, the court, upon motion, shall dismiss the action without prejudice as to that defendant, or upon good cause shown or in the interest of justice, extend the time for service."

"An extension of time for service is a matter within the Court's discretion" (Leader v Maroney, Ponzini & Spencer, 97 NY2d 95, 101). In applying the CPLR 306-b interest of justice standard, which is distinct from the good cause standard (see State of New York Mtge. Agency v Braun, 182 AD3d 63), the court must engage in " a careful judicial analysis of the factual setting of the case and a balancing of the competing interests presented by the parties'" (BAC Home Loans Servicing, L.P. v Herbst, 180 AD3d 980, 981, quoting Leader v Maroney, Ponzini & Spencer, 97 NY2d at 105). In so doing, " the court may consider diligence, or lack thereof, along with any other relevant factor in making its determination, including expiration of the Statute of Limitations, the [potentially] meritorious nature of the cause of action, the length of delay in service, the promptness of a plaintiff's request for the extension of time, and prejudice to defendant'" (BAC Home Loans Servicing, L.P. v Herbst, 180 AD3d at 981, quoting Leader v Maroney, Ponzini & Spencer, 97 NY2d at 105-106).


Here, we agree with the Supreme Court that the plaintiff's delay of nearly five years between obtaining a default judgment of foreclosure and sale against the defendant and its attempt to enforce that judgment, during which time the statute of limitations expired, weighed against extending the time to serve the defendant with the summons and complaint by approximately nine years. In addition, the court found that the plaintiff was seeking relief pursuant to CPLR 306-b to avoid the consequences of its inability to produce its process server on the scheduled date of the hearing. Under these circumstances, the court providently exercised its discretion in determining that granting the plaintiff's motion would not serve the interest of justice. Likewise, we agree with the court's determination granting the defendant's motion, inter alia, to dismiss the complaint insofar as asserted against him on the ground that he had not been properly served with the summons and complaint."

ORAL JOINT VENTURE AND THE STATUTE OF FRAUDS

Get it in writing.

MacKay v Paesano, 2020 NY Slip Op 04155, Decided on July 22, 2020, Appellate Division, Second Department:

"According to the plaintiff, he entered into an oral joint venture agreement with the defendant Michael Paesano (hereinafter the defendant) in which the plaintiff would refer potential investors to the defendant, who would provide them with financial consulting services and investment opportunities for which the defendant would receive fees and commissions. In exchange for the plaintiff's referrals, the defendant allegedly agreed to pay the plaintiff an annual referral fee of 0.5% of all revenues generated from the plaintiff's referrals. The plaintiff alleges that he was never compensated by the defendant despite referring approximately 200 investors to him.

The plaintiff commenced this action, inter alia, to recover damages for breach of contract. The defendant moved, inter alia, pursuant to CPLR 3211(a) to dismiss the complaint insofar as asserted against him. The Supreme Court granted that branch of the defendant's motion.

"The essential elements of a joint venture are an agreement manifesting the intent of the parties to be associated as joint venturers, a contribution by the coventurers to the joint undertaking (i.e., a combination of property, financial resources, effort, skill or knowledge), some degree of joint proprietorship and control over the enterprise; and a provision for the sharing of profits and losses" (Mawere v Landau, 130 AD3d 986, 988 [internal quotation marks omitted]; see Clarke v Sky Express, Inc., 118 AD3d 935, 936). The plaintiff failed to state a cause of action based on a joint venture agreement because he failed to allege "a mutual promise or undertaking to share the burden of the losses of the alleged enterprise" (Rocchio v Biondi, 40 AD3d 615, 616). Moreover, the complaint failed to allege joint control over the purported enterprise (see Kaufman v Torkan, 51 AD3d 977). Since the complaint fails to make a showing sufficient to establish the existence of an enforceable joint venture agreement, it also fails to make a showing sufficient to establish the [*2]existence of a fiduciary obligation owed to the plaintiff by the defendant (see Kidz Cloz, Inc. v Officially For Kids, Inc., 320 F Supp 2d 164, 176 [SD NY]). Therefore, accepting the facts as alleged in the complaint as true, and according the plaintiff the benefit of every possible inference (see CPLR 3211[a][7]), we agree with the Supreme Court's determination to dismiss the causes of action alleging breach of a joint venture agreement and breach of fiduciary duty insofar as asserted against the defendant.

We agree with the Supreme Court's determination to dismiss the cause of action alleging breach of contract insofar as asserted against the defendant since enforcement of the alleged oral agreement is barred by the statute of frauds (see General Obligations Law § 5-701[a][10]; JF Capital Advisors, LLC v Lightstone Group, LLC, 25 NY3d 759). Similarly, the causes of action sounding in unjust enrichment and quantum meruit are barred by the statute of frauds (see Snyder v Bronfman, 13 NY3d 504).


Further, we agree with the Supreme Court's determination to dismiss the causes of action alleging fraudulent misrepresentation and promissory estoppel insofar as asserted against the defendant. Those causes of action are duplicative of the unenforceable breach of contract cause of action and, thus, constitute an impermissible attempt to circumvent the statute of frauds (see Martin Greenfield Clothiers, Ltd. v Brooks Bros. Group, Inc., 175 AD3d 636; Gorman v Fowkes, 97 AD3d 726)."

A FORECLOSURE SALE UNDER THE UCC

It differs from a real property mortgage foreclosure sale.

Laskaratos v Bay Ridge Hoyt Lender, LLC, 2020 NY Slip Op 04152, Decided on July 22, 2020, Appellate Division, Second Department:

"In an action, inter alia, to recover damages for breach of contract, the plaintiff appeals from a judgment of the Supreme Court, Kings County (Lawrence Knipel, J.), dated August 3, 2018. The judgment, upon an order of the same court dated July 28, 2017, granting the defendants' motion for summary judgment dismissing the complaint and on their counterclaims for a deficiency judgment and an award of attorneys' fees, is in favor of the defendants and against the plaintiff in the sum of $979,932.62.

ORDERED that the judgment is affirmed, with costs.

On or about October 15, 2014, the plaintiff and her limited liability company Konstan Realty, LLC (hereinafter Konstan Realty), entered into a loan agreement as borrowers with the defendant Bay Ridge Hoyt Lender, LLC (hereinafter Lender), for the sum of $1,525,000. The plaintiff pledged and guaranteed, inter alia, her 100% interest in Konstan Realty as collateral for the loan. The plaintiff defaulted on her January 2015 loan payment. The plaintiff contends that Davin Vounasis, an agent of Lender, advised her that she could forego paying the January 2015 installment because she was in the process of refinancing the loan. The defendants foreclosed on the plaintiff's 100% ownership interest in Konstan Realty and offered the interest for sale at a public auction. Lender purchased the interest in Konstan Realty, reportedly for $10,000.

The plaintiff commenced the instant action alleging, inter alia, breach of contract on the basis of the defendants' purported failure to conduct a commercially reasonable sale under the UCC, as required under the loan agreement. The defendants moved for summary judgment dismissing the complaint and on their counterclaims for a deficiency judgment and an award of attorneys' fees. The Supreme Court granted the motion, and an inquest was held on the defendants' counterclaims for a deficiency judgment and an award of attorneys' fees. The court, relying upon the defendants' expert appraiser, determined that the value of the collateral was $1,650,000, which was to be set off against the debt owed, and awarded the defendants attorneys' fees in the sum of $212,717.90. The plaintiff appeals from the judgment entered following the inquest.

The defendants established their prima facie entitlement to judgment as a matter of law dismissing the causes of action alleging breach of contract and breach of the implied covenant [*2]of good faith and fair dealing by submitting evidence showing that the plaintiff entered into a loan agreement with Lender and guaranteed the loan by pledging, among other things, her shares in Konstan Realty, that the plaintiff defaulted on the loan agreement by failing to make payments starting in January 2015, that Lender exercised its right to sell the shares of Konstan Realty at public auction, and that Lender adhered to the terms and conditions imposed by the loan agreement and security pledge upon the plaintiff's default (see Staffenberg v Fairfield Pagma Assoc., L.P., 95 AD3d 873; see generally Canzona v Atanasio, 118 AD3d 837). The defendants established their prima facie entitlement to judgment as a matter of law dismissing the cause of action alleging promissory or equitable estoppel by demonstrating the existence of a valid and enforceable written loan agreement and security pledge (see Pacella v Town of Newburgh Volunteer Ambulance Corps., Inc., 164 AD3d 809). The defendants established their prima facie entitlement to judgment as a matter of law dismissing the cause of action alleging tortious interference with the plaintiff's economic expectancy by demonstrating that they did not interfere with the anticipated refinancing of the loan and, instead, provided the plaintiff with the requested documents to assist in the refinancing closing (see NBT Bancorp v Fleet/Norstar Fin. Group, 87 NY2d 614, 621).

In opposition, the plaintiff proffered only conclusory and unsupported allegations. Bald, conclusory assertions, which are unsupported by the record, are insufficient to defeat summary judgment (see S.J. Capelin Assoc. v Globe Mfg. Corp., 34 NY2d 338, 342; Orellana v 7 W. 34th St., LLC, 173 AD3d 886). In addition, the plaintiff admitted that she failed to make the January 2015 payment, which constitutes a default under the loan agreement. The plaintiff's contention that she relied to her detriment upon an alleged discussion with Lender's agent, wherein he advised that because of an anticipated refinancing of the loan, Lender would accept payoff of the loan at the closing of the refinancing in lieu of the plaintiff making the payment due for January 2015, contradicts a contemporaneous email sent by Lender to the plaintiff. In any event, pursuant to the loan agreement, no modification or waiver of any provision therein was effective unless in writing signed by the party against whom enforcement is sought (see Bank of Smithtown v Boglino, 254 AD2d 319).

Accordingly, the Supreme Court properly granted the defendants' motion for summary judgment.

Contrary to the plaintiff's contention, an inquest on damages was proper upon the grant of summary judgment (see e.g. Simon v Maximum Sec. Brokerage, 198 AD2d 491). The plaintiff's contention that the report proffered by the defendants' expert appraiser was inadmissible and insufficient to establish the value of the collateral is unpreserved for appellate review. The plaintiff's remaining contentions are without merit."

LITIGATION - COMMENCE THE ACTION AGAINST THE ESTATE NOT THE DECEASED

Federal Natl. Mtge. Assn. v Tudor, 2020 NY Slip Op 04149, Decided on July 22, 2020, Appellate Division, Second Department:

"In April 2014, the plaintiff commenced this action to foreclose a mortgage executed by the defendant Gladys Tudor. Tudor passed away approximately two years prior to the commencement of the action. Tudor's daughter, Vanise Elliott, was served with the summons and complaint, purportedly as the recipient of substituted service on behalf of her mother, and purportedly as a "John Doe" occupant of the subject premises. Elliott did not answer the complaint, although she appeared for at least two settlement conferences.

In May 2015, the plaintiff moved, inter alia, for leave to enter a default judgment against Elliott and for an order of reference. The Supreme Court granted the motion without opposition.
Subsequently, the plaintiff moved for a judgment of foreclosure and sale. Elliott appeared at a conference and produced a death certificate for her mother, whereupon the plaintiff withdrew its motion.

On or about September 28, 2016, the plaintiff moved, inter alia, to amend the complaint to add additional defendants. The plaintiff sought to add any additional heirs of Tudor as defendants and to serve any such parties by publication. The plaintiff also sought to amend the complaint to reflect the "capacity" of Elliott as an heir of the defendant Tudor, rather than as a mere occupant of the subject premises. Elliott cross-moved to vacate the default judgment and for leave to serve a late answer. In an order dated September 13, 2018, the Supreme Court, among other things, denied the plaintiff's motion, and, sua sponte, directed the dismissal of the complaint.

"A party may not commence a legal action or proceeding against a dead person" (Jordan v City of New York, 23 AD3d 436, 437; see Krysa v Estate of Qyra, 136 AD3d 760, 760). Thus, where a mortgagor dies prior to the commencement of a foreclosure action, the action is a "legal nullity," insofar as asserted against the deceased mortgagor (see Citigroup Global Mkts. Realty Corp. v LaGreca, 167 AD3d 842; U.S. Bank N.A. v Cadeumag, 147 AD3d 881; Dime Sav. Bank of N.Y. v Luna, 302 AD2d 558; cf. HSBC Bank USA v Ungar Family Realty Corp., 111 AD3d 673, 673-674). Accordingly, the instant action was a legal nullity, insofar as asserted against Tudor, the sole property owner and mortgagor.

In any event, the proposed amendment of the complaint to amend the "capacity" of Elliott to reflect that she was sued as a purported heir to Tudor, and to add any additional heirs of Tudor as defendants, would not serve to effectuate jurisdiction over the estate of Tudor, for purposes of a mortgage foreclosure action (see Wendover Fin. Servs. v Ridgeway, 93 AD3d 1156; see also Deutsche Bank Natl. Trust Co. v Faden, 172 AD3d 817).




Consequently, we agree with the Supreme Court's determination to deny leave to amend the complaint and to direct dismissal of the complaint."

A BAD MARRIAGE ENDS IN A BAD DIVORCE - PART 3 - VEXATIOUS LITIGATION HAS A PRICE

JESSICA T. v. KIETH T., 2020 NY Slip Op 50673, NY: Supreme Court, Suffolk County, June 12, 2020:

"In addition, the Court cannot ignore the role the Defendant has played in wasting precious time these last several years that the Plaintiff could have utilized for training, education or building her resume. His bullying tactics enumerated above were born out of spite and ill will. He perverted the judicial process to exact some sort of revenge upon the Plaintiff and alienated his own son as a result of his actions. This Court must redress the Defendant's misbehavior in a way not to penalize the Defendant, as such would require various due process procedures such as notice absent here.^[13] This Court however, must compensate the Plaintiff for the Defendant's frivolous conduct and abuse of her through the legal system.

Federal courts have "inherent powers," not conferred by rule or statute, "to manage their own affairs so as to achieve the orderly and expeditious disposition of cases" (Link v Wabash R. Co., 370 US 626, 630-631, 82 SCt 1386, 8 LEd2d 734 [1962]). That authority includes "the ability to fashion an appropriate sanction for conduct which abuses the judicial process" (Chambers v NASCO, Inc., 501 US 32, 44-45, 111 SCt 2123, 115 LEd2d 27 [1991]). The United States Supreme Court has made clear that such a sanction, when imposed pursuant to civil procedures, must be compensatory rather than punitive in nature (see Mine Workers v Bagwell, 512 US 821, 826-830, 114 SCt 2552, 129 LEd2d 642 [1994]).

Similarly, this Court has the discretion to impose financial sanctions upon any party or attorney in a civil action or proceeding who engages in frivolous conduct (22 NYCRR 130-1.1[a]; see Rhodes v Rhodes, 169 AD3d 841, 844, 94 N.Y.S.3d 123, 127 [2d Dept 2019]). Conduct is frivolous and sanctions may be awarded if "it is completely without merit in law" or fact and "cannot be support by a[ny] reasonable argument for an extension, modification or reversal of existing law" (22 NYCRR 130-1.1[c][1]). Furthermore, if conduct "is undertaken primarily to delay or prolong the resolution of the litigation, or to harass or maliciously injure another" (22 NYCRR 130-1.1 [c] [2]) or if such conduct "asserts material factual statements that are false" (22 NYCRR 130-1.1 [c] [3]) sanctions may be warranted (see Weissman v. Weissman, 116 AD3d 848, 849, 985 N.Y.S.2d 93 [2d Dept 2014]). In light of the fact that the Defendant has abused the Plaintiff throughout the litigation with his manipulation of the court process by his blatant disregard of the truth, pressing frivolous claims, wasting court time with witnesses that had at best merely uninformed opinions, causing drawn out conferences and examinations of witnesses that were not probative, making specious arguments and accusations including parent alienation, refusing to pay timely support payments until threatened with incarceration, refusing to help save the marital home from foreclosure, harassing and annoying the Plaintiff and J., refusing to pay his share of the court-ordered business evaluation which precluded the Plaintiff from demonstrating any potential increase in business' value during the marriage, and by prolonging this case by creating unnecessary litigation, the court will award financial compensation to the Plaintiff (see id. at 850).^[14]


Therefore, pursuant to the Court's above consideration of the factors necessary to award an amount and duration of maintenance, and in order to do justice in this case and compensate the Plaintiff for some of the injuries that the Plaintiff has suffered as a result of the Defendant's malicious, vexatious/abusive litigation, and as a sanction for the Defendant's completely frivolous conduct throughout this case and certainly during this trial, the Court will award the Plaintiff ten years of maintenance payments. Furthermore, while normally the years and amounts paid during the pendente lite period are accounted for in formulating post-divorce maintenance, here, because of the Defendant's own actions and vexatious litigation which purposefully attenuated this proceeding, and the need to compensate the Plaintiff, the Defendant will receive no credit for the approximately last 6 years of pendente lite payments.^[15] There is simply no other way to accomplish justice in this case as the Defendant's malicious, egregious and conscience-shocking conduct toward the Plaintiff and the parties' son J. needs to be addressed. While the Court could under these egregious circumstances equitably distribute all of the assets to the Plaintiff as a penalty (see Howard S. v Lillian S., 14 NY3d 431, 436, 928 NE2d 399, 402, 902 NYS2d 17, 20 [2010]), it is necessary for future payment purposes to award the Defendant his business (which is addressed below).
.......

(FOOTNOTES TO ABOVE)

[13] Indeed, the only notice to the Defendant regarding the possibility of punishment was given in the Plaintiff's contempt motion that was referred to this trial, which addressed his failure to pay money, not his abuse of her through the judicial process. The Court does note, however, that over the course of this case, the Plaintiff did repeatedly request that the Court stop the Defendant from delaying the case, from harassing her with motion practice and in other ways, and from allegedly giving away her pertinent personal information to the Father's Rights groups he associated with which she found on the Group's social media. The Court, however, does not deem that to be sufficient notice.

[14] The Defendant's vexatious behavior in this case is akin to a prima facie tort or an abuse of process. A prima facie tort consists of four elements: (1) intentional infliction of harm, (2) causing special damages, (3) without excuse or justification, (4) by an act or series of acts that would otherwise be lawful (Burns J.son Miller Summit & Spitzer v Lindner, 59 NY2d 314, 332, 464 N.Y.S.2d 712, 451 N.E.2d 459 [1983]). An abuse of process has three essential elements: (1) regularly issued process, either civil or criminal, (2) an intent to do harm without excuse or justification, and (3) use of the process in a perverted manner to obtain a collateral objective (Lynn v McCormick, 153 AD3d 688, 688, 60 N.Y.S.3d 316, 317 [2d Dept 2017])."

A BAD MARRIAGE ENDS IN A BAD DIVORCE - PART 2

The case is JESSICA T. v. KIETH T., 2020 NY Slip Op 50673, NY: Supreme Court, Suffolk County, June 12, 2020 and this is how Justice Leis describes the background:

"The parties were married on August 26, 1999 and have 2 children, J. (age 17) and C. (age 15). Their assets consist of the marital home and the Defendant's landscaping business Woodstock Estate Maintenance, Ltd. ("Woodstock"). This divorce case was commenced in December of 2013.

This case has a tortured history. Both parties are pro se having exhausted hundreds of thousands of dollars in counsel fees. At present, the Court has spent 62 days on trial in this matter consisting of 29 Hearing days to determine contempt and alleged parent alienation motions, 12 Trial days to determine permanent custody of the boys and visitation issues, and 21 days on this equitable distribution phase of the Trial wherein the parties introduced a total of 164 exhibits.

This Court was assigned this matter June 8, 2017 as an M.S.R.P. case.^[1] On June 16, 2017 the Court conducted its first contempt hearing pursuant to the Plaintiff's application to hold the Defendant in contempt for his failure to pay support. During the hearing, the Defendant and his attorney provided no defense to the Plaintiff's allegations. Accordingly, on a Friday the Defendant was found in contempt and sentenced to incarceration for his failure to pay thousands of dollars in court-ordered child support and maintenance. The Defendant purged the contempt by Monday morning. The Court conducted a second contempt hearing, which should have only taken several days, but lasted 29 days because of the Defendant's frivolous and false allegations that the Plaintiff had engaged in parent alienation. After hearing from numerous experts, the Plaintiff, the Defendant and J. (in-camera), the Court concluded that the Defendant's allegations of parental alienation by the Plaintiff were totally false and without merit.^[2]

The Court notes that the experts called during that proceeding by the Defendant had never spoken to J. or the Plaintiff so could not give an opinion on whether parent alienation had occurred.

Nevertheless, to this date, the Defendant persists in his allegation of parental alienation by the Plaintiff.

The Court next conducted a custody trial which lasted 12 days after which the Court granted full custody of both C. and J. to the Plaintiff and found that the Defendant was solely responsible for J.'s refusal to visit with him.^[3] Based on the conduct of the Defendant, the Court terminated all ongoing reunification therapy between J. and the Defendant and terminated all court-ordered visitation between J. and the Defendant.

Finally, the Court has concluded the equitable distribution trial. With no assets other than the marital home and the Defendant's landscaping business, and with no expert witnesses^[4], the matter has been unnecessarily prolonged by the Defendant for a total of 21 days of trial.

The main reason this divorce action has moved so slowly is the Defendant's efforts to delay, prolong and obfuscate the proceeding. Despite repeated directions by the Court to refrain from extended diatribes and cross-examination on immaterial and collateral matters, the Defendant has refused to obey the directions of the Court. The Court was therefore forced on numerous occasions to end the Defendant's examination on irrelevant topics with witnesses in the hope of moving this case toward a final determination. The Defendant's arguments, that his collateral inquiries bear relevance on this proceeding because they deal with credibility issues, are not genuine. The Defendant's main desire seems to be to inflict some sort of harm upon the Plaintiff in any manner possible as displayed throughout the entirety of this case. Indeed, in the final stages of this equitable distribution Trial, the Defendant brought another motion to recuse the Court and another motion to hold the Plaintiff in contempt. The recusal motion was the Defendant's second written motion for recusal. The Court found in its decision dated February 19, 2020 that it was frivolous, baseless and brought solely to delay and prolong this equitable distribution Trial. The application to hold the Plaintiff in contempt was made a year and a half after the alleged contumacious conduct, and was found by this Court in a decision dated February 19, 2020 to be totally baseless, frivolous and likewise made solely to delay and prolong this proceeding.^[5]

From the inception of this divorce action, the Defendant has refused to timely pay court-ordered maintenance and support. The Defendant's resentment toward the Plaintiff's boyfriend, (who frequents the marital house but does not live there), is obsessive. The Defendant has allowed utilities to be shut off in the marital home resulting in a lack of heat in the winter in his deliberative effort to punish the Plaintiff for filing a divorce action and having a relationship with another man. The Defendant has totally lost his relationship with his older son J. by his conduct and actions, and he possibly would have lost his relationship with his younger son C. but for the Plaintiff's concerted efforts to foster the relationship.

The Defendant's penchant for intimidation of the Plaintiff and J. has evolved into attempts to intimidate the court-appointed Attorney For the Children, the attorneys involved in the case (including his own), and the Court itself by filing a frivolous Federal lawsuit seeking billions of dollars from each of the defendants named therein, including this Jurist. The Defendant's use of all aspects of both the State and Federal Judiciary to harass and annoy those whom he has set out to attack cannot be condoned or tolerated.

Although this Court has handled thousands of domestic violence cases over the course of its 34 years on the bench, in both Family Court and as a Justice of the Supreme Court (assigned to the Integrated Domestic Violence Court, Guardianship, Matrimonial and Civil cases), this case stands out as one of the most insidious. Here, the harassment did not stop at the commencement of the action or with the parties' separation, but accelerated exponentially and has continued for more than six years after the summons and notice were filed.

The Defendant has used the very system that is supposed to provide justice and protection to victims of domestic violence to terrorize and emotionally abuse the Plaintiff and the parties' oldest child, J. What the Court did not realize during the many hours spent with J. and his attorney in the in-camera interviews trying to persuade J. to visit with his father, was the malignancy and magnitude of the Defendant's vexatious/abusive litigation tactics^[6] perpetrated against this child and his mother. During the three separate proceedings held in this matter, the Defendant's actions, statements and conduct have vacillated between the absurd and the delusional. This is fully observable in his summation in this matter wherein he requested $344,860.00 in support and maintenance, and $140,000.00 for attorneys fees from the unemployed, stay-at-home, non-monied Plaintiff. One thing remains clear, however, the Defendant's conduct never waivers from the malicious which runs through the core of his concerted efforts. His compulsive lying, demonstrated throughout these proceedings, is insidious and is just one of the many things that J. dislikes in his father.

In its attempt to provide fairness and due process to the Defendant and give him a full opportunity to prove his case, the Court has unwittingly permitted the Defendant to continue to harass the Plaintiff and their son J. by prolonging this matter. This decision can now provide some form of compensatory justice to the Plaintiff and call the Defendant to task for his malignant use of the judicial process."

A BAD MARRIAGE ENDS IN A BAD DIVORCE - PART 1

In this case, life almost imitates art, as we explore a recent decision with this introductory statement by the court:

"This case is unique as it details a type of domestic violence which generally goes unnoticed in our judicial system and goes beyond the usual parameters of physical, emotional, or economic abuse occurring during the period of time that the parties reside together. This form of domestic violence is by proxy and it uses the very judicial system which is supposed to protect individuals from domestic violence, to continue the perpetrators' need for control well after the parties' separation and commencement of the divorce action. This case demonstrates the repercussions and consequences that await an individual who engages in this very insidious form of domestic violence committed through vexatious/abusive litigation."

DIVORCE - STATUTE OF LIMITATIONS FOR RAISING NUPITAL AGREEMENT AS DEFENSE

New York Domestic Relations Law § 250 provides:

"1. The statute of limitations for commencing an action or proceeding or for claiming a defense that arises from an agreement made pursuant to subdivision three of part B of section two hundred thirty-six of this article entered into (a) prior to a marriage or (b) during the marriage, but prior to the service of process in a matrimonial action or proceeding, shall be three years.

2. The statute of limitations shall be tolled until (a) process has been served in such matrimonial action or proceeding, or (b) the death of one of the parties.

3. The provisions of this section shall not apply to a separation agreement or an agreement made during the pendency of a matrimonial action or in settlement thereof."

Washiradusit v Athonvarangkul, 2020 NY Slip Op 03562, Decided on June 24, 2020, Appellate Division, Second Department:

"The parties were married in February 2001 and subsequently purchased certain real property in Woodside (hereinafter the property). Prior to the closing, the parties entered into a "Property Agreement" dated November 18, 2002 (hereinafter the postnuptial agreement). The postnuptial agreement required the parties to put the property up for sale "no later than 90 days after filing by either party for divorce or separation," and provided that the parties would split 50/50 any proceeds remaining after satisfaction of the mortgage and other costs.

In November 2011, the plaintiff commenced this action for a divorce and ancillary relief. The defendant answered the complaint, seeking spousal maintenance and counsel fees. No claims were asserted in the pleadings regarding the postnuptial agreement. In October 2016, the defendant moved, inter alia, to enforce the postnuptial agreement. In opposition, the plaintiff asserted that the defendant's claim to enforce the postnuptial agreement was time-barred pursuant to Domestic Relations Law § 250. Alternatively, the plaintiff cross-moved, among other things, in effect, to set aside the postnuptial agreement as unconscionable. The Supreme Court granted that branch of the defendant's motion which was to enforce the postnuptial agreement, and denied that branch of the plaintiff's cross motion which was, in effect, to set aside the postnuptial agreement as unconscionable. The plaintiff appeals.

Contrary to the Supreme Court's determination, the six-year statute of limitations that pertains to breach of contract causes of action (see CPLR 213[2]) is not applicable. Rather, the [*2]applicable statute of limitations is provided for in Domestic Relations Law § 250. Pursuant to Domestic Relations Law § 250, the statute of limitations for claims arising from prenuptial and postnuptial agreements is three years and that period is tolled, as relevant here, until process has been served in a matrimonial action. The language of the statute makes it broadly applicable to claims arising from prenuptial and postnuptial agreements, such that it applies equally where a party seeks to invalidate the agreement and where a party seeks to enforce it (see Domestic Relations Law § 250[1]; Alan D. Scheinkman, Practice Commentaries, McKinney's Cons Laws of NY, Domestic Relations Law C250).

Here, the defendant did not assert his claim to enforce the postnuptial agreement until more than 4½ years after he was served with process in the matrimonial action. Accordingly, the defendant's claim is untimely, and should have been rejected.

Further, since the defendant is no longer entitled to enforce the postnuptial agreement, that branch of the plaintiff's cross motion which was, in effect, to set aside the agreement as unconscionable should have been denied as academic."