Spoliation.

On a motion for spoliation sanctions involving the destruction of electronic evidence, the party seeking sanctions must establish that: (1) the party with control over the evidence had an obligation to preserve it at the time it was destroyed; (2) the records were destroyed with a culpable state of mind;  and (3) the destroyed evidence was relevant to the moving party's claim or defense.

Here, Supreme Court providently exercised its discretion in imposing sanctions against plaintiff on the ground that plaintiff's majority shareholder had deliberately deleted relevant emails. At a hearing, defendant showed that the shareholder had deleted the emails after June 7, 2022, the date on which plaintiff had sent a prelitigation notice of default and demand for payment, threatening imminent litigation. The evidence at the hearing further showed that the emails were permanently removed from the hard drive by taking affirmative steps to delete them from the deleted items folder or recycle bin. This evidence was sufficient to demonstrate that the emails were deleted deliberately.

Coney Is. Auto Holdings, Corp. v. Parts Auth., LLC, NY Slip Op 04900 (1st Dep't October 8, 2024)

Here is the decision.

Discovery sanctions.

Pursuant to CPLR 3126, a court may impose discovery sanctions, including the striking of a pleading or preclusion of evidence, where a party refuses to obey an order for disclosure or willfully fails to disclose information which the court finds ought to have been disclosed. The nature and degree of the penalty is a matter within the discretion of the motion court.  However, the Appellate Division is vested with its own discretion and corresponding power to substitute its own discretion for that of the trial court, even in the absence of abuse.

Public policy strongly favors the resolution of actions on the merits whenever possible.  Thus, before a court invokes the remedy of precluding evidence, there must be a clear showing that the failure to comply with discovery was willful and contumacious. The willful or contumacious character of a party's conduct can be inferred from the party's repeated failure to respond to demands or to comply with discovery orders, and the absence of any reasonable excuse for its failures.

Gibson v. Delemos, NY Slip Op 04761 (2d Dep't October 2, 2024)

Here is the decision.

Rescission.

A unilateral mistake can be the basis for rescission if failing to rescind would result in unjust enrichment of one party at the expense of the other, and the parties can be returned to the status quo ante without prejudice.

Gaetano v. 1210 Troy Schenectady Rd., LLC, NY Slip Op 04760 (2d Dep't October 2, 2024)

Here is the decision.

Adding a party.

Pursuant to CPLR 1003, "[p]arties may be added at any stage of [an] action by leave of court or by stipulation of all parties who have appeared." CPLR 3025(b) provides that "[a] party may amend [its] pleading . . . at any time by leave of court or by stipulation of all parties." A plaintiff's failure to comply with CPLR 1003 when attempting to add a new defendant is a jurisdictional defect, and an amended complaint that is not filed in accordance with CPLR 1003 and 3025 is a legal nullity.

Braylovskaya v. Skazka Rest., NY Slip Op 04756 (2d Dep't October 2, 2024)

Here is the decision.

Suing the Housing Authority.

Service of a notice of claim within 90 days after accrual of the claim is a condition precedent to commencing an action against NYCHA. Pursuant to General Municipal Law § 50-e(5), upon application, the Supreme Court, in its discretion, may extend the time to serve a notice of claim upon a public corporation as required by General Municipal Law § 50-e(1).

In determining whether to grant leave to serve a late notice of claim or to deem a late notice of claim timely served nunc pro tunc, the court must consider all relevant circumstances, including whether: (1) the public corporation acquired actual knowledge of the essential facts constituting the claim within 90 days from its accrual or a reasonable time thereafter; (2) the injured child was an infant at the time the claim arose, and, if so, whether there was a nexus between the infancy and the failure to serve a timely notice of claim; (3) the plaintiff demonstrated a reasonable excuse for the failure to serve a timely notice of claim; and (4) the public corporation was substantially prejudiced by the delay in its ability to maintain a defense on the merits. No single factor is determinative, although it is generally recognized that the question of whether the public corporation timely acquired actual knowledge is of great importance. 

In order to have actual knowledge of the essential facts constituting the claim, the public corporation must have knowledge of the facts that underlie the legal theory on which liability is predicated in the notice of claim; the public corporation need not have specific notice of the theory. Here, the record did not demonstrate that NYCHA acquired timely, actual knowledge of the essential facts constituting the claim that the infant plaintiff sustained personal injuries as a result of NYCHA's negligence. Moreover, the plaintiffs failed to provide a reasonable excuse for their failure to serve a timely notice of claim. 

J.B. v. City of New York, NY Slip Op 04755 (2d Dep't October 2, 2024)

Here is the decision.

Indemnification.

A finding of negligence nullifies any common-law indemnity claim.

Ace Am. Ins. Co. v. Consolidated Edison Co. of N.Y., Inc., NY Slip Op 04800 (1st Dep't October 3, 2024)

Here is the decision.

Summary judgment motions.

The non-movant's mere hope or speculation that evidence sufficient to defeat a motion for summary judgment may be uncovered during the discovery process is insufficient to warrant denial of the motion.

Carmona v. Preston, NY Slip Op 04757 (2d Dep't October 2, 2024)

Here is the decision.

Appellate practice.

To the extent that plaintiff seeks affirmative relief, such as sanctions and striking of defendants' answer, in his opposition to defendants' motion to compel, the Appellate Division declines to grant that relief, as plaintiff did not cross-move for it before the motion court.  Similarly, the Appellate Division declines plaintiff's request to vacate prior orders, as plaintiff did not take an appeal from them.

Schwartz v. Mount Sinai Hosp., NY Slip Op 04750 (1st Dep't October 4, 2024)

Here is the decision.

Motions to dismiss.

In order to prevail on a motion pursuant to CPLR 3211(a)(1), the movant's evidence must utterly refute the plaintiff's factual allegations, conclusively establishing a defense as a matter of law. Contracts and any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence. 

When reviewing a motion to dismiss a complaint pursuant to CPLR 3211(a)(7), the court must afford the pleading a liberal construction, accept the facts as alleged in the complaint as true, accord the plaintiff the benefit of every favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory. 

Plymouth Capital, LLC v. Montage Fin. Group, Inc., NY Slip Op 04583 (2d Dep't September 25, 2024)

Here is the decision.

Account stated.

An account stated claim is an account balanced and rendered, with an assent to the balance, express or implied, so that the demand is essentially the same as if a promissory note had been given for the balance. A defendant's receipt and retention of invoices seeking payment for goods or services rendered, without objection within a reasonable time, gives rise to an actionable claim.

TH Fashion Ltd. v. Vince Holding Corp., NY Slip Op 04630 (1st Dep't September 26, 2024)

Here is the decision.

Arbitration.

While American Arbitration Association rules delegate to the arbitrator the issue of whether a particular dispute is subject to an arbitration agreement, it is for the courts to determine, in the first instance, whether the parties have entered into a binding agreement to arbitrate.

Matter of Whythe Berry, LLC v. Goldman, NY Slip Op 04632 (1st Dep't September 26, 2024)

Here is the decision.