Whistleblower suits and notices of claim.

Practice point:  A party bringing a whistleblower claim, and seeking both legal and equitable remedies, must file a notice of claim pursuant to General Municipal Law §§ 50-e, 50-i, even though the Whistleblower Statute is not a tort statute and technically does not fall within the categories described in General Municipal Law § 50-i.  However, a plaintiff whose claim falls under the jurisdiction of General Municipal Law § 50-e, or other narrow statutory notice requirements, may pursue an equitable claim, including one for reinstatement, absent the notice of claim.

Student note: The Whistleblower Law forbids retaliatory personnel action by public employers against their employees who disclose to a governmental body information regarding violations of regulations that would present a specific danger to public health or safety, or about what the employee believes to be an improper governmental action, pursuant to Civil Service Law § 75-b[1][d]; [2][a]. A whistleblower claim may seek both monetary damages and equitable relief, including an injunction to restrain continued violation of the law; reinstatement to the same or equivalent position as before, with full fringe benefits and seniority rights; compensation for lost wages, benefits and other remuneration; and reasonable costs, disbursements and attorney's fees, pursuant to Civil Service Law § 75-b[3][c], referencing Labor Law § 740[5].

Case:  Rose v New York City Health & Hosps. Corp., NY Slip Op 06013 (1st Dept. 2014)

Here is the decision.

Monday's issue: The plaintiff's identifying the cause of the fall.

Attorney-defendants' alleged participation in a fraudulent corporate scheme.

Practice point:  Plaintiffs allege that the attorney-defendants, who were retained as the attorneys for the allegedly fraudulent corporation, were complicit in the fraudulent scheme by drafting documents and a shareholder agreement designed to give plaintiffs the impression that the corporation was legitimate, and by dealing directly with plaintiffs in reviewing the documents and giving them "accompanying legal advice and counsel."

The Appellate Division determined that, as against the attorney-defendants, the causes of action sounding in constructive fraud and negligent misrepresentation causes of action were deficient, as they failed to to allege the requisite fiduciary or special relationship between plaintiffs and defendants. The Appellate Division noted that the attorneys for a corporation represent the corporate entity, not the shareholders, and here the parties did not expressly agree otherwise. Plaintiffs' subjective belief did not create an attorney-client relationship or a close relationship approaching privity that imposed on defendants a duty to impart correct information.

Student note:  To the extent that the causes of action, as pleaded, could be fairly interpreted as including liability for aiding and abetting fraud, they are still deficient because they fail to allege that the attorney-defendants had actual knowledge of the fraud and provided substantial assistance in its commission. The allegation that the attorneys "knew or should have known" of the fraud is conclusory, and alleges mere constructive knowledge. The allegations that the attorneys prepared merger documents and a shareholder agreement are allegations of ordinary professional activity, not substantial assistance.

Case: Gregor v. Rossi, NY Slip Op 06012 (1st Dept. 2014)

Here is the decision.

Tomorrow's issue: Whistleblower suits and notices of claim.

Emails, affidavits, and documentary evidence.

Practice point::  A cause of action may be dismissed pursuant to CPLR 3211(a)(1) only where the documentary evidence utterly refutes the plaintiff's factual allegations, conclusively establishing a defense as a matter of law, and definitely disposing of the plaintiff's claim.

Student note:  In a proper case, email correspondence can suffice as documentary evidence for purposes of CPLR 3211(a)(1).  However, factual affidavits are not documentary evidence within the meaning of the statute.

Case:  Art & Fashion Group Corp. v. Cyclops Prod., Inc., NY Slip Op 06008 (1st Dept. 2014)

Here is the decision.

Tomorrow's issue:  Attorney-defendants' alleged participation in a fraudulent corporate scheme.

Moving for a change of venue.

Practice point:  To effect a change of venue pursuant to CPLR 510(1), a defendant must show that the plaintiff's choice of venue is improper and that defendant's choice of venue is proper. To succeed on his motion here, the defendant was obligated to demonstrate that, on the date that this action was commenced, neither of the parties resided in the county that the plaintiff designated. Only if the defendant made such a showing was the plaintiff required to establish, in opposition, via documentary evidence, that the venue he had selected was proper.

The only evidence that the defendant submitted with respect to the issue of the plaintiff's residence was the police accident report on the accident. This evidence merely showed that, at the time the accident occurred, the plaintiff had a residence in Texas. This evidence did not demonstrate that the plaintiff did not maintain a residence in Kings County when the action was commenced, two months after the accident. Therefore, the defendant failed to meet his initial burden.

Student note:   A plaintiff may choose venue based solely on a defendant's address, as set forth in a police accident report.  However, that report, standing alone, is not enough to demonstrate that, on the date that an action is commenced, a plaintiff does not reside in the county where he or she elects to place venue.

Case:  Chehab v. Roitman, NY Slip Op 05939 (2d Dept. 2014)

Here is the decision.

Tomorrow's issue:  Emails, affidavits, and documentary evidence.

Court holiday.

Triangle Shirtwaist Factory

The courts are closed to mark Labor Day.

Tomorrow's issue:  Moving for a change of venue.








                                                                                                                         

Commencing a tort action against a municipality.

Practice point:  In order to commence a tort action against a municipality, General Municipal Law § 50-e(1)(a) requires a claimant to serve a notice of claim upon that municipality within 90 days after the date that the claim arose. General Municipal Law § 50-e(5) permits a court, in its discretion, to extend the time to serve a notice of claim. Whether the public corporation acquired timely actual knowledge of the essential facts constituting the claim within 90 days after the claim arose or a reasonable time thereafter is seen as a factor which should be accorded great weight in determining whether or not to grant leave to serve a late notice of claim.  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 or theories on which liability is predicated in the notice of claim; the public corporation need not have specific notice of the theory or theories themselves.

Student note:  Other factors a court must consider in determining whether to grant leave to serve a late notice of claim are: (1) whether the claimant was an infant or mentally or physically incapacitated; (2) whether the claimant had a reasonable excuse for the failure to serve a timely notice of claim; and (3) whether the delay would substantially prejudice the public corporation in maintaining its defense (see General Municipal Law § 50-e[5].

Case:  Kellman v. Hauppauge Union Free School Dist., NY Slip Op 05844 (2d Dept. 2014)

Here is the decision..

Tuesday's issue: Moving for a change of venue.

Standing in a mortgage foreclosure action.

Practice point:  In a mortgage foreclosure action, a plaintiff has standing where it is the holder or assignee of both the subject mortgage and of the underlying note at the time the action is commenced. Either a written assignment of the underlying note or the physical delivery of the note prior to the commencement of the foreclosure action is sufficient to transfer the obligation.

Student note:  Where, as here, standing is put into issue by a defendant, the plaintiff must prove its standing in order to be entitled to relief.

Case:  Federal Natl. Mtge. Assn. v. Cappelli, NY Slip Op 05836 (2d Dept. 2014)

Here is the decision.

Tomorrow's issue: Commencing a tort action against a municipality.

Dismissal pursuant to CPLR 3216.

Practice point:  CPLR 3216 permits a court to dismiss an action for want of prosecution only after the court or the defendant has served the plaintiff with a written demand requiring the plaintiff to resume prosecution of the action and to serve and file a note of issue within 90 days after receipt of the demand, and also stating that the failure to comply with the demand will serve as a basis for a motion to dismiss the action.

Student note  As CPLR 3216 is a legislative creation and not part of a court's inherent power, a court may not dismiss an action for want of prosecution where the plaintiff was not served with the requisite 90-day demand pursuant to CPLR 3216(b).

Case:  Diemer v. Eben Ezer Med. Assoc., NY Slip Op 058323 (2d Dept. 2014)

Here is the decision.

Tomorrow's issue: Standing in a mortgage foreclosure action.

The service requirements of a foreclosure action.

Practice point:. RPAPL 1304[1] requires that "at least ninety days before a lender, an assignee or a mortgage loan servicer commences legal action against the borrower, including mortgage foreclosure, such lender, assignee or mortgage loan servicer shall give notice to the borrower in at least fourteen-point type."  The statute sets forth the requirements for the content of the notice, and further provides that the notice must be sent by registered or certified mail, and also by first-class mail, to the last known address of the borrower, pursuant to RPAPL 1304[2].

Student note:  Proper service of the RPAPL 1304 notice on the borrower or borrowers is a condition precedent to the commencement of a foreclosure action.

Case:  Deutsche Bank Natl. Trust Co. v. Quinn, NY Slip Op 05829 (2d Dept. 2014)

Here is the decision.

Tomorrow's issue: Dismissal pursuant to CPLR 3216.

Sanctions for spoilation of evidence.

Practice point:  The Supreme Court has broad discretion in determining what, if any, sanction should be imposed for spoliation of evidence, and it may mpose a sanction even if the destruction occurred through negligence rather than wilfulness, and even if the evidence was destroyed before the spoliator became a party, provided the spoliator was on notice that the evidence might be needed for future litigation.

Here, the Appellate Division determined that the Supreme Court providently exercised its discretion in striking the defendant's answers and thereupon awarding the plaintiffs summary judgment on the issue of liability pursuant to CPLR 3126. The record demonstrates that the defendant disposed of the grate involved in the accident after having received a written demand from one of the infant plaintiff's attorneys that the grate be preserved for inspection by the plaintiffs and their experts. Moreover, the plaintiffs demonstrated that they were unduly prejudiced by the defendant's conduct in disposing of the grate.

Student note:  Under the common-law doctrine of spoliation, when a party negligently loses or intentionally destroys key evidence, that party may be sanctioned under CPLR 3126.

Case:  Biniachvili v. Yeshivat Shaare Torah, Inc., NY Slip 05826 (2d Dept. 2014)

Here is the decision.

Tomorrow's issue: The service requirements of a foreclosure action.

A worker's fall from a ladder.

Practice point:  The mere fact that a plaintiff fell from a ladder does not, in and of itself, establish that proper protection was not provided. There must be evidence that the ladder was defective or inadequately secured and that the defect, or the failure to secure the ladder, was a substantial factor in causing the plaintiff's injuries.

Student note:  Labor Law § 240(1) imposes upon owners and general contractors, including their agents, a nondelegable duty to provide safety devices necessary to protect workers from the risks inherent in elevated work-sites.

Case: Karanikolas v. Elias Taverna, LLC, NY Slip Op 05774 (2d Dept. 2014)

Here is the decision.

Monday's issue: Sanctions for spoilation of evidence.