Pleading the pandemic as an affirmative defense.

In this loan default action, defendants plead, as an affirmative defense, that plaintiff's damages result from circumstances beyond defendants' control, and, therefore, are barred by the doctrines of impossibility and frustration of purpose. Defendants also plead a counterclaim which asks the court to declare that defendants' obligations to plaintiff pursuant to the loans are discharged because the sharp reduction in revenue that taxicabs suffered due to plummeting ridership during the COVID-19 pandemic excuses defendants' contractual obligations. However, defendants do not show that the financial hardship they suffered is tantamount to the destruction of the subject matter" of the loan agreements or that their reasons for performing under the loan agreements ceased to exist, such that the doctrines of impossibility or frustration of purpose would apply. 

What is more, defendants' invocation of the pandemic as grounds for application of the doctrines of frustration of purpose or impossibility is an approach that has been squarely rejected, even where, because of the pandemic, the business of the party seeking application of such doctrines was temporarily suspended. 

Pentagon Fed. Credit Union v. Popovic, NY Slip Op 03076 (1st Dep't June 8, 2023)

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Extending time to serve process.

 CPLR 306-b provides, in pertinent part, that "[s]ervice of the summons and complaint . . . shall be made within one hundred twenty days after the commencement of the action . . . . If 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." The interest of justice standard requires a careful judicial analysis of the factual setting of the case and a balancing of the competing interests as presented by the parties. Unlike an extension request premised on good cause, a plaintiff need not establish reasonably diligent efforts at service as a threshold matter. However, the court may consider diligence, or the lack thereof, along with any other relevant factor in making its determination, including expiration of the Statute of Limitations, the meritorious nature of the cause of action, the length of delay in service, the promptness of the plaintiff's request for the extension of time, and prejudice to the defendant. No single factor is determinative. 

Deutsche Bank Trust Co. Ams., v. Lottihall, NY Slip Op 02999 (2d Dep't June 7, 2023)

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Dismissal of a complaint as abandoned.

CPLR 3215(c) provides that if a plaintiff fails to take proceedings for the entry of judgment within one year after the defendant's default, the court shall not enter judgment but shall dismiss the complaint as abandoned, without costs, upon its own initiative or on motion, unless sufficient cause is shown why the complaint should not be dismissed. In order to avoid dismissal pursuant to the statute, it is not necessary for the plaintiff actually to obtain a default judgment within one year. The plaintiff is not even required to specifically seek a default judgment within the year. As long as the plaintiff has initiated proceedings for the entry of a judgment within one year of the default, there is no basis for dismissal of the complaint pursuant to CPLR 3215(c). The statutory language is not discretionary, but mandatory, inasmuch as courts "shall" dismiss claims for which default judgments are not sought within the requisite one-year period, as those claims are then deemed abandoned. The one exception to the otherwise mandatory language of CPLR 3215(c) is that the failure to timely seek a default on an unanswered complaint or counterclaim may be excused if sufficient cause is shown why the complaint should not be dismissed. The Second Department has interpreted this language as requiring both a reasonable excuse for the delay in timely moving for a default judgment, plus a demonstration that the cause of action is potentially meritorious.   The determination of whether an excuse is reasonable in any given instance is committed to the sound discretion of the Supreme Court. 

Bank of N.Y. v. Pieloch, NY Slip Op 02996 (2d Dep't June 7, 2023)

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Contract law.

A defendant's failure to read the agreement before executing it is not a defense to a claim for breach of contract because a party is under an obligation to read a document before he signs it.

Walber 82 St. Assoc., L.P. v. Fisher, NY Slip Op 02993 (1st Dep't June 6, 2023)

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A premature motion for summary judgment.

The court denies the pre-discovery motion as premature based on plaintiff's showing that facts essential to justify opposition to defendant's motion may lie within defendant's exclusive knowledge or control, pursuant to CPLR 3212[f].

North Flatts LLC v. Belkin Burden Goldman, LLP, NY Slip Op 02954 (1st Dep't June 1, 2023)

Here is the decision.

Leave to intervene.

A motion seeking leave to intervene, whether made pursuant to CPLR 1012 or 1013, must include the would-be intervenor's proposed pleading, as required by CPLR 1014. Here, the movant did not submit a proposed pleading with the motion for leave to intervene. Neither did the movant submit an affidavit which in some cases may excuse the failure to attach a proposed pleading. The motion is denied.

U.S. Bank Trust N.A. v. 21647 LLC, NY Slip Op 02955 (1st Dep't June 1, 2023)

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Defaulting on a real estate contract.

A party to a contract cannot rely on another's failure to perform a condition precedent where he himself has frustrated or prevented the occurrence of the condition. Therefore, absent a breach on the part of the seller, a purchaser who defaults on a real estate contract without lawful excuse cannot recover its down payment.

Agosta v. Abraham, NY Slip Op 02934 (1st Dep't June 1, 2023)

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Slips, trips, and falls.

Generally, the issue of whether a dangerous or defective condition exists depends on the particular facts of each case, and is properly a question of fact for the jury to decide. However, injuries resulting from trivial defects are not actionable and may be decided as a matter of law. A defendant seeking dismissal of a complaint on the basis that the alleged defect is trivial must make a prima facie showing that, under the circumstances of the case, the defect is physically insignificant and that the characteristics of the defect or the surrounding circumstances do not increase the risks it poses. On that showing, the burden shift to the plaintiff to establish an issue of fact so as to survive dismissal. In determining whether a defect is trivial, the court must examine all of the facts presented, including the defect's width, depth, elevation, irregularity, and appearance, along with the time, place, and circumstance of the injury. Photographs which fairly and accurately represent the accident site may be used to establish that a defect is trivial and, therefore, not actionable.

Balbo v. Greenfield's Mkt. of Bethpage, LLC, NY Slip Op 02860 (2d Dep't May 31, 2023)

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Motion practice.

Pursuant to the Uniform Civil Rules for the Supreme Court and the County Court, at 22 NYCRR 202.8-b[a], [c], moving papers must include a word-count certification. Failure to submit the certification is a technical defect that the motion court should overlook.  However, failure to comply with the requirements of 22 NYCRR 202.7 cannot be overlooked. Pursuant to that rule, a discovery motion must be accompanied by moving counsel's affirmation that he or she has conferred with opposing counsel in a good-faith effort to resolve the issues raised by the motion. The purpose of this rule is to avoid the unnecessary expenditure of limited judicial resources in circumstances where, through constructive dialogue, the attorneys could resolve the issues that otherwise would be raised in a motion. The affirmation must indicate the time, place, and nature of the consultation and the issues discussed and their resolution, or good cause why no such conferral was held.  The failure to submit the affirmation warrants denial of the motion.

Anuchina v. Marine Transp. Logistics, Inc., NY Slip Op 02858 (2d Dep't May 31, 2023)

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Default judgments.

Pursuant to CPLR 3215(f), an applicant for a default judgment against a defendant must submit proof of service of the summons and complaint, proof of the facts constituting the claim, and proof of the defaulting defendant's failure to answer or appear. In order to demonstrate the facts constituting the claim, the movant need only submit sufficient proof to enable a court to determine that there is a viable cause of action. In opposition to a motion for leave to enter a default judgment, the defendant who has failed to timely appear or answer the complaint must provide a reasonable excuse for the default and demonstrate a potentially meritorious defense to the action.  Whether a proffered excuse is reasonable is a sui generis determination to be made by the court based on all relevant factors, including the extent of the delay, whether there has been prejudice to the opposing party, whether there has been willfulness, and the strong public policy in favor of resolving cases on the merits. The determination of what constitutes a reasonable excuse lies within the discretion of the motion court. Where the defendant fails to demonstrate a reasonable excuse for its default, the court need not consider whether the defendant possesses a potentially meritorious defense to the action.  

Cartessa Aesthetics, LLC v. Demko, NY Slip Op 03328 (2d Dep't June 21, 2023)

Here is the decision.

Liquidated damages.

Whether an early termination fee is an enforceable liquidation of damages or an unenforceable penalty is a question of law, giving due consideration to the nature of the contract and the circumstances. A liquidated damages clause is enforceable if the amount liquidated bears a reasonable proportion to the probable loss and the amount of actual loss is incapable or difficult of precise estimation. The burden is on the party seeking to avoid liquidated damages to show that the stated damages are, in fact, a penalty. This burden is met with evidence establishing that actual damages were readily ascertainable at the time the contract was entered into or that the liquidated damages are conspicuously disproportionate to foreseeable or probable losses.

Pool Doctor Mgt. Serv., Inc. v. Board of Mgrs. of the Meadowlands Estates Condominium, Inc., NY Slip Op 02800 (2d Dep't May 24, 2023)

Here is the decision.