Vacatur of a default judgment denied.

Practice point:  The Appellate Division reversed, and denied the motion to vacate. For one thing, defendants failed to demonstrate a reasonable excuse for their default. Defendants' counsel never substantiated or explained the nature of the "serious family matter" that purportedly caused the default. At most, counsel had an ex parte communication with the motion court about the facts of the action, and, during that communication, may or may not have revealed the facts surrounding the alleged family matter. This ex parte communication is an insufficient basis upon which to vacate a default judgment, especially where, as here, the details of the communication are not known.

Defendants also failed to explain why their counsel's family matter was so serious that it kept him from either interposing an answer or responding to plaintiff's motion for a default judgment.  The record contains no adequate explanation for why the law firm representing defendants failed to communicate with plaintiff's counsel for nearly five months, even to inform counsel that a family emergency prevented defendants from timely responding to the litigation. In addition, two attorneys, only one of whom was affected by a family emergency, were representing defendants, and defendants do not explain why the other attorney representing them could not have taken the necessary steps to advance the litigation.

For another thing, defendants' assertion that they were entitled to a premium payment because they executed and posted a bail bond does not present a meritorious defense to plaintiff's action. Although execution of the bond is a condition precedent for retaining a premium payment, defendants failed to present any documentary evidence that they had actually executed and posted any bond. Neither did defendants present any evidence that the motion court ever conducted an examination of surety.

Student note:  While there is a strong public policy in favor of disposing of cases on their merits, this policy does not relieve a party moving to vacate a default from satisfying the two-pronged test of showing both (1) a reasonable excuse for the default; and (2) a meritorious defense to the action.

Case:  Johnson-Roberts v. Ira Judelson Bail Bonds, NY Slip Op 04785 (1st Dep't June 16, 2016)

Here is the decision.

Monday's issue:  Res judicata and a judgment of foreclosure and sale.

Obtaining a preliminary injunction.

Practice point:  To obtain a preliminary injunction, the moving party must establish, by clear and convincing evidence, the following: (1) a likelihood of success on the merits; (2) irreparable injury absent the injunction; and (3) that the equities balance is in the movant's favor.

Student note:  The decision to grant or deny the injunction lies within the sound discretion of the Supreme Court.

Case:  Chase Home Fin., LLC v. Cartelli, NY Slip Op 04685 (2d Dep't June 15, 2016)

Here is the decision.

Tomorrow's issue: Vacatur of a default judgment denied.

A 3211(a)(7) motion to dismiss.

Practice point:  Where evidentiary material is submitted and considered on a motion pursuant to CPLR 3211(a)(7), and the motion is not converted into one for summary judgment, the question is whether the plaintiff has a cause of action, not whether the plaintiff has stated one.  Unless it has been shown that a material fact claimed by the plaintiff is not a fact at all, and unless it can be said that no significant dispute exists regarding it, the complaint should not be dismissed.

Student note:  Affidavits submitted in support of the motion may not be examined for the purpose of determining whether there is evidentiary support of the pleading.

Case:  Anglero v. Hanif, NY Slip Op 04683 (2d Dep't June 15, 2016)

Here is the decision.

Tomorrow's issue:  Obtaining a preliminary injunction.

Dismissal of a complaint, and denial of a cross-motion for spoilation sanctions.

Practice point:  The Appellate Division affirmed dismissal where defendant satisfied its initial burden on summary judgment by establishing, prima facie, that any alleged defect in the stairway at issue and/or in its premises lighting was not a proximate cause of plaintiff's accident, and plaintiff failed to raise a triable issue of fact relating his accident and injuries to either.

The Appellate Division also found that court properly denied the cross motion for spoliation sanctions. Plaintiff failed to specify a particular defect that caused him to fall, and even if defendant should have maintained its video footage of the subject staircase, plaintiff cannot establish that the failure to preserve it left him without appropriate means to present a claim with incisive evidence, as is required for the imposition of sanctions.

Student note:  The court properly declined to consider the errata sheet even though it was timely served, because plaintiff made changes to his testimony without explaining why he was making them, as required by CPLR 3116(a).

Case:  Cataudella v. 17 John St. Assoc., LLC, NY Slip Op 04784 (1st Dep't June 16, 2016)

Here is the decision.

Tomorrow's issue: A 3211(a)(7) motion to dismiss.

A motion to change venue.

Practice point:  The Appellate Division reversed the denial of the motion to change and the granting of the cross-motion to retain venue, and ordered that the matter be remanded for a hearing to resolve the factual issues raised in the motions.

The Appellate Division found that the denial of defendants' motion to change venue from Bronx County to Westchester County without a hearing was an improvident exercise of discretion. Once a movant establishes in a venue motion that the plaintiff's residence was other than that claimed in the complaint, the plaintiff opposing a motion for a change of venue must establish through documentary evidence his claimed residence. Here, substantial documentary evidence produced in discovery and submitted by defendants on their motion indicated that on the date of the accident plaintiff resided in Westchester County. These documents include hospital records from the time of plaintiff's accident, the incident report from the day of the accident, plaintiff's employment records, tax records and forms from the Internal Revenue Service, pharmacy records, Department of Motor Vehicle records, and automobile insurance records, all of which indicate that his address is in New Rochelle, Westchester County. In response, plaintiff's assertion that he resides at the Bronx residence that he co-owns with his fiancée, while buttressed by the affidavits of his fiancée and a neighbor, was not supported by any objective documentation. The only document plaintiff provided, which he describes as a water bill, is merely an undated commercial solicitation sent to him as a listed homeowner.

Student note:  Although a person may have more than one residence, for venue purposes, there must be evidence that the plaintiff actually resided at the claimed residence at the time the action was commenced. An ownership interest in property does not alone demonstrate residence at that property.

Case:  Crovato v. H&M Hennes & Mauritz, L.P., NY Slip Op 04660 (1st Dep't June 14, 2016)

Here is the decision.

Tomorrow's issue:  Dismissal of a complaint, and denial of a cross-motion for spoilation sanctions.

Discovery and the production of eletronic documents.

Practice point:  The Appellate Division determined that it was not an improvident exercise of the Supreme Court's discretion to deny that branch of the appellants' motion which was to compel the production of electronic documents in a different format than that in which the documents were previously produced.

Student note: It is well settled that a party is not entitled to unlimited, uncontrolled, unfettered disclosure, and the supervision of discovery is left to the trial court's broad discretion.

Case:  Aalco Transp. & Stor., Inc. v. DeGuara, NY Slip Op 04368 (2d Dep't June 8, 2016)

Here is the decision.

Monday's issue:  A motion to change venue

Vacating a default judgment.

Practice point:  The Appellate Division reversed the denial of defendant's motion to vacate a default judgment against him, finding that the suspension of defendant's counsel during the pendency of this action resulted in an automatic stay of the proceedings against defendant until thirty days after notice to appoint another attorney was served upon him, or until the court granted leave to resume proceedings, pursuant to CPLR 321[c].  Because there was no compliance with the leave or notice requirements of CPLR 321(c), and defendant did not retain new counsel until February 2014, the automatic stay was in place when the November 22, 2013 judgment was entered based upon defendant's default. Accordingly, the judgment must be vacated.

Student note:  Defendant's failure to invoke CPLR 321(c) until submission of his reply papers on his motion does not result in a waiver of his argument.  Neither was he required to submit an affidavit of merit.

Case:  Duandre Corp. v. Golden Krust Caribbean Bakery & Grill, NY Slip Op 04461 (1st Dep't June 9, 2016)

Here is the decision.

Tomorrow's issue: Discovery and the production of electronic documents.

An owner's liability for a fall in a lessee's bar.

Practice point:  The Appellate Division affirmed dismissal of the complaint as against the owner which established prima facie that it was not responsible for repairing the leak in the window that the lessee claims was the source of the pool of water in which plaintiff allegedly slipped. The lease provides that the owner is responsible only for structural repairs, the definition of which does not include windows. Nor did the lessee identify any significant structural or design defect that was contrary to a specific statutory safety provision.

Student note:  As the owner owed no duty to plaintiff to repair the window, whether it had actual or constructive notice of the leak is immaterial.

Case:  Syrko v. Jertom Inc., NY Slip Op 04448 (1st Dep't June 9, 2016)

Here is the decision.

Tomorrow's issue:  Vacating a default judgment.

Vacatur of an arbitration award pursuant to CPLR 7511.

Practice point:  In this contract action between the seller of a business and the broker, the seller moved to vacate the arbitration award and the broker cross-moved to confirm the award.  The Appellate Division determined that the seller failed to establish its entitlement to vacatur, pursuant to CPLR 7511(b)(1)(i), (ii), or (iii), on the ground of partiality, misconduct, or irrationality.

The arbitrator should have disclosed to the parties that he had been the arbitrator in a prior unrelated proceeding in which the broker was a party. Although the seller's attorney learned of the prior arbitration from the brokers' attorney a week after the hearing, the seller continued to actively participate in the arbitration process without raising any objections to the arbitrator. Under these circumstances, the seller waived any claims related to the alleged partiality of the arbitrator. In any event, the seller failed to establish that the prior arbitration had any effect upon the arbitrator's ability to be neutral in the instant matter. The seller also failed to demonstrate that the arbitrator committed misconduct, or that the arbitration award was irrational.

Student note:  CPLR 7511(b)(1)(i) and (ii) provide that an arbitration award shall be vacated upon the motion of a party if the court finds that the rights of that party were prejudiced by misconduct in procuring the award or partiality of an arbitrator appointed as a neutral.  In addition, an arbitration award may be vacated pursuant to CPLR 7511(b)(1)(iii) where an arbitrator exceeds his or her power, which includes only those narrow circumstances in which the award violates public policy, is irrational, or clearly exceeds a specifically enumerated limitation on the arbitrator's power. Outside of these narrowly circumscribed exceptions, courts lack authority to review arbitral decisions, even where an arbitrator has made an error of law or fact.

Case:  A & L Vil. Mkt., Inc. v. 344 Vil., Inc., NY Slip Op 04368 (2d Dep't June 8, 2016)

Here is the decision.

Tomorrow's issue:  An owner's liability for a fall in a lessee's bar.

An ineffective employment agreement and post-termination commissions.

Practice point:  The Appellate Division affirmed dismissal, finding that plaintiff's breach of contract claim, which alleged that the corporate defendant breached the parties' employment agreement by failing to pay her certain compensation and benefits upon the termination of her employment in 2013, was correctly dismissed. The employment agreement expired in December 2007, and it unambiguously provided that any extension of the agreement needed to be in writing. Because there was no writing extending the agreement, her breach of contract claim fails as a matter of law.

Plaintiff's unjust enrichment claim seeking post-termination commissions fails because, on the expiration of her employment agreement, plaintiff became an at-will employee, and at-will employees are not entitled to post-termination commissions.

Plaintiff's claims for promissory estoppel, fraud, and negligent misrepresentation fail, since, in the absence of a signed employment agreement, she could not have reasonably relied upon defendants' alleged oral representations regarding the terms of her employment.

Student note:  The Appellate Division rejected plaintiff's assertion that the motion court should have allowed her to conduct further discovery under CPLR 3211(d) so that she could obtain documents confirming that her employment was renewed after the expiration of her employment agreement. As any renewal had to be in writing, and plaintiff alleged in her complaint that the parties did not execute any further written amendments to the employment terms after the agreement expired, there was no basis for further discovery.

Case:  Holahan v. 488 Performance Group, Inc., NY Slip Op 04311 (1st Dep't June 2, 2016)

Here is the decision.

Tomorrow's issue:  Vacatur of an arbitration award pursuant to CPLR 7511.

A fatally flawed motion for summary judgment in lieu of complaint.

Practice point:  The plaintiffs commenced this action to recover on a promissory note by motion for summary judgment in lieu of complaint pursuant to CPLR 3213. However, they made the motion returnable on a date prior to the expiration of the time within which the defendant had to appear in the action, which was a fatal jurisdictional defect.  The Appellate Division determined that the Supreme Court properly granted that branch of the defendant's motion which was to dismiss the action.

Student note:   The Appellate Division will not consider an appellant's contentions that are raised for the first time on appeal.

Case:  Bhanti v. Jha, NY Slip Op 04166 (2d Dep't June 1, 2016)

Here is the decision. 

Monday's issue:  An ineffective employment agreement and post-termination commissions.