theCPLRblog

Estoppels abound

Maybaum v Maybaum, 2011 NY Slip Op 07816 (2nd Dept., 3011)

The Supreme Court erred in granting that branch of the plaintiff's motion which was to strike stated paragraphs of the defendant's counterclaim on the grounds of res judicata, collateral estoppel, and equitable estoppel. The allegations in the defendant's counterclaim for a divorce on the ground of cruel and inhuman treatment, and the allegations in the plaintiff's family offense petition, did not arise out of the same transaction or series of transactions. "It is not always clear whether particular claims are part of the same transaction for res judicata purposes. A pragmatic' test has been applied to make this determination—analyzing whether the facts are related in time, space, origin, or motivation, whether they form a convenient trial unit, and whether their treatment as a unit conforms to the parties' expectations or business understanding or usage'" (Xiao Yang Chen v Fischer, 6 NY3d 94, 100-101, quoting Restatement [Second] of Judgments § 24[2]; see Smith v Russell Sage Coll., 54 NY2d 185, 192-193). Applying this test, we conclude that the family offense petition and counterclaim for a divorce on the ground of cruel and inhuman treatment do not form a convenient trial unit. Thus, the defendant is not precluded from litigating her counterclaim for a divorce on the ground of cruel and inhuman treatment in the separate action in the Supreme Court. 

"Collateral estoppel, or issue preclusion, precludes a party from relitigating in a subsequent action or proceeding an issue clearly raised in a prior action or proceeding and decided against that party . . . , whether or not the tribunals or causes of action are the same'" (Parker v Blauvelt Volunteer Fire Co., 93 NY2d 343, 349, quoting Ryan v New York Tel. Co., 62 NY2d 494, 500). "The doctrine applies if the issue in the second action is identical to an issue which was raised, necessarily decided and material in the first action, and the plaintiff had a full and fair opportunity to litigate the issue in the earlier action" (Parker v Blauvelt Volunteer Fire Co., 93 NY2d at 349). "[C]ollateral estoppel effect will only be given to matters actually litigated and determined in a prior action" (Kaufman v Eli Lilly & Co., 65 NY2d 449, 456 [internal quotation marks omitted]). "An issue is not actually litigated if, for example, there has been a default, a confession of liability, a failure to place a matter in issue by proper pleading or even because of a stipulation" (id. at 456-457). Here, the issue of whether the plaintiff committed certain acts against the defendant was never determined in the Family Court proceeding, and the defendant's participation in the stipulation to withdraw her family offense petition, with prejudice, cannot be construed to be the kind of determination following a full and fair opportunity to litigate the issues that would be necessary to collaterally estop the defendant from establishing that the plaintiff committed the alleged acts (see North Shore-Long Is. Jewish Health Sys., Inc. v Aetna US Healthcare, Inc., 27 AD3d 439, 440-441; Singleton Mgt. v Compere, 243 AD2d 213, 216-218).

Further, "[t]he circumstances set forth by plaintiff simply do not rise to a level of unconscionability warranting application of equitable estoppel" (American Bartenders School v 105 Madison Co., 59 NY2d 716, 718; see Geller v Reuben Gittelman Hebrew Day School, 34 AD3d 730, 731-732).

Since the doctrines of res judicata, collateral estoppel, and equitable estoppel do not preclude the defendant from litigating certain of the allegations in her counterclaim that were alleged in her family offense petition, the Supreme Court should have granted that branch of the defendant's cross motion which was pursuant to CPLR 3211(b) to dismiss the plaintiff's fourth affirmative defense alleging that the defendant's counterclaim was barred in whole or in part by the doctrines of res judicata, collateral estoppel, and equitable estoppel, as that defense has no merit.

The Supreme Court further erred in granting that branch of the plaintiff's motion which was to strike stated paragraphs of the defendant's counterclaim, in effect, as time-barred on the ground they alleged acts occurring more than five years prior to the commencement of the action. The allegations in the counterclaim relating to incidents occurring more than five years before the commencement of the action may be properly included to the extent that those allegations may be relevant to an evaluation of a party's claim for a divorce on the ground of cruel and inhuman treatment in the context of the entire marriage (see Vestal v Vestal, 273 AD2d 461, 462; Miglio v Miglio, 147 AD2d 460, 460-461). Further, the Supreme Court erred in granting that branch of the plaintiff's motion which was pursuant to CPLR 3016(c) to strike stated paragraphs in the counterclaim for lack of specificity and thereupon directing the defendant to serve and file an amended counterclaim. The "allegations sufficiently apprised the [plaintiff] of the accusations against him so as to enable him to prepare a defense" (Nolletti v Nolletti, 2 AD3d 421, 422; see Kapchan v Kapchan, 104 AD2d 358; Pfeil v Pfeil, 100 AD2d 725). Therefore, the Supreme Court also should have granted that branch of the defendant's cross motion which was pursuant to CPLR 3211(b) to dismiss the plaintiff's third affirmative defense alleging that the counterclaim was insufficiently specific to meet the requirements of CPLR 3016(c).

Farren v Lisogorsky, 2011 NY Slip Op 06366 (2nd Dept., 2011)

Prior to answering, the defendant moved to dismiss the complaint pursuant to CPLR 3211(a)(5) and (7), for summary judgment dismissing the complaint, and for an award of sanctions. The Supreme Court, inter alia, granted that branch of the motion which was to dismiss the complaint pursuant to CPLR 3211(a)(5), holding that the doctrine of res judicata precluded the instant action. We reverse the order insofar as appealed from. 

" [T]he general doctrine of res judicata gives binding effect to the judgment of a court of competent jurisdiction and prevents the parties to an action, and those in privity with them, from subsequently relitigating any questions that were necessarily decided therein'" (Landau, P.C. v LaRossa, Mitchell, & Ross, 11 NY3d 8, 13, quoting Matter of Grainger [Shea Enters.], 309 NY 605, 616). Although the doctrine of res judicata may be invoked where there is either a final judgment in an action between the parties, or a stipulation of settlement withdrawing a complaint or cause of action with prejudice (see Liberty Assoc. v Etkin, 69 AD3d 681, 682-683), to establish "privity" of the kind required for the application of res judicata, the party raising a res judicata defense must demonstrate a connection between the party to be precluded and a party to the prior action "such that the interests of the nonparty can be said to have been represented in the prior proceeding" (Green v Santa Fe Indus., 70 NY2d 244, 253).

The doctrine of res judicata is inapplicable to the instant action, as the plaintiffs never asserted any claim against the defendant in his capacity as an employee of Metropolitan, and seek here to hold him liable solely in his professional capacity as a pharmacist (see City of New York v Welsbach Elec. Corp., 9 NY3d 124, 127-128; Pawling Lake Prop. Owners Assn., Inc. v Greiner, 72 AD3d 665). The fact that the plaintiffs sued one tortfeasor, Metropolitan, does not automatically preclude them from suing another tortfeasor, such as the defendant herein, in a subsequent action (see Seaman v Fichet-Bauche N. Am., 176 AD2d 793, 794). In addition, the defendant inaptly sought to invoke res judicata against the plaintiffs based on his alleged privity with Metropolitan. Since there was an insufficient basis upon which to conclude that the defendant was in privity with Metropolitan, the Supreme Court incorrectly granted that branch of the defendant's motion which was pursuant to CPLR 3211(a)(5) to dismiss the complaint based on the doctrine of res judicata.

Uzamere v Senator Ehigie Edobor Uzamere, 2011 NY Slip Op 08583 (2nd Dept., 2011)

The Supreme Court properly directed dismissal of the complaint based on the doctrine of res judicata. The plaintiff previously commenced two prior federal court actions, one in the Eastern District of New York (hereinafter the Eastern District action) and one in the Southern District of New York based on the same alleged facts that form the basis of the complaint herein. In light of authority stating that a court should apply the rules of res judicata followed in the jurisdiction that rendered the earlier court decision (see Insurance Co. of State of Pa. v HSBC Bank USA, 10 NY3d 32, 38 n 3, citing Marrese v American Academy of Orthopaedic Surgeons, 470 US 373, 380-381; Langerman v Langerman, 303 NY 465, 474; Restatement [Second] of Conflict of Laws § 95, Comment[e]), we apply federal res judicata law in determining whether the doctrine of res judicata bars this action.

"In federal court, subsequent litigation is prohibited if a prior court ruling was (1) a final judgment on the merits, (2) by a court of competent jurisdiction, (3) in a case involving the same parties or their privies, and (4) involving the same cause of action'" (Insurance Co. of State of Pa. v HSBC Bank USA, 10 NY3d at 37, quoting EDP Med. Computer Sys., Inc. v United States, 480 F3d 621, 624).

Here, the Eastern District action resulted in a dismissal of the complaint for failure to state a claim upon which relief could be granted, and that dismissal was a final adjudication on the merits by a court of competent jurisdiction (see Federated Department Stores, Inc. v Moitie, 452 US 394, 399 n 3; Angel v Bullington, 330 US 183, 190). Furthermore, the Eastern District action and this action involve the same parties or their privies (see Akhenaten v Najee, LLC, 544 F Supp 2d 320, 328-329), and involve the same cause of action. Specifically, the Eastern District complaint and the instant complaint arise out of the same "nucleus of operative facts" and, thus, the causes of action asserted in this litigation could have been asserted in the Eastern District action (Waldman v Village of Kiryas Joel, 207 F3d 105, 108). Moreover, under the circumstances of this case, it is not clear that the Eastern District would have, as a matter of discretion, declined to exercise supplemental jurisdiction over the State law causes of action asserted herein (see Troy v Goord, 300 AD2d 1086; cf. McLearn v Cowen & Co., 48 NY2d 696, 698; Urlic v Insurance Co. of State of Penn., 259 AD2d 1, 4).

RJ and CE and EE

Breslin Realty Dev. Corp. v Shaw, 2010 NY Slip Op 00087 (App. Div., 2nd, 2010)

II. Res Judicata and Collateral Estoppel

Under the doctrine of res judicata, a final judgment precludes reconsideration of all claims which could have or should have been litigated in the prior proceedings against the same party (see Parker v Blauvelt Volunteer Fire Co., 93 NY2d 343, 347). The doctrine of collateral estoppel, a narrower species of res judicata, precludes a party from relitigating in a subsequent action or proceeding an issue clearly raised in the prior action or proceeding, and decided against that party or those in privity, whether or not the tribunals or causes of action are the same (see Ryan v New York Tel. Co., 62 NY2d 494, 501-502). Once the party seeking the benefit of collateral estoppel establishes that the identical issue was "material" (emphasis supplied) to a prior judicial or quasi-judicial determination, the party to be estopped bears the burden of establishing the absence of a full and fair opportunity to litigate the issue in the prior action or proceeding (id.). Contrary to the determination of the Supreme Court, the proponent of the doctrine of collateral estoppel need not demonstrate that the particular theory in support of a cause of action was actually raised and litigated in the prior action or proceeding (see Matter of Schulz v New York State Legislature, 278 AD2d 710, 711; Williams v Steinberg, 211 AD2d 597; Lanzano v City of New York, 202 AD2d 378, 379; Sokol v Sokol, 113 F3d 303, 306).

Where the prior adjudication involved the same parties and the same cause of action, res judicata applies. "Under res judicata, or claim preclusion, a valid final judgment bars future actions between the parties on the same cause of action . . . As a general rule, once a claim is brought to a final conclusion, all other claims arising out of the same transaction or series of transactions are barred, even if based upon different theories or if seeking a different remedy'" (Parker v Blauvelt Volunteer Fire Co., 93 NY2d 343, 347, quoting O'Brien v City of Syracuse, 54 NY2d 353, 357; see Insurance Co. of State of Pa. v HSBC Bank USA, 10 NY3d 32).

Union St. Tower, LLC v Richmond, 2011 NY Slip Op 03834 (App. Div., 2nd 2011)

The doctrine of res judicata " operates to preclude the renewal of issues actually litigated and resolved in a prior proceeding as well as claims for different relief which arise out of the same factual grouping or transaction and which should have or could have been resolved in the prior proceeding'" (Luscher v Arrua, 21 AD3d 1005, 1006-1007, quoting Koether v Generalow, 213 AD2d 379, 380). To determine what "factual grouping" constitutes a "transaction," the court must consider how " the facts are related in time, space, origin, or motivation, whether they form a convenient trial unit, and whether . . . their treatment as a unit conforms to the parties' expectations or business understanding or usage'" (Smith v Russell Sage Coll., 54 NY2d 185, 192-193, quoting Restatement, Judgments 2d [Tent Draft No. 1], § 61; see Braunstein v Braunstein, 114 AD2d 46, 53). Under New York's transactional approach to the doctrine of res judicata, "once a claim is brought to a final conclusion, all other claims arising out of the same transaction or series of transactions are barred, even if based upon different theories or if seeking a different remedy" (O'Brien v City of Syracuse, 54 NY2d 353, 357).

The first and second counterclaims in this action are barred by res judicata because those claims could have been resolved in the March 2004 action (see Jennings v City of Glens Falls Indus. Dev. Agency, 9 AD3d 773, 774). These counterclaims, when compared with the causes of action in the March 2004 action "are related in time, space, origin, [and] motivation" (Smith v Russell Sage Coll., 54 NY2d at 192-193). They (1) originate from the identical agreement, (2) span the same period of time, (3) involve the same chief participants, and (4) involve the same motivation of Richmond to reclaim an ownership interest in Lot 4. "Under these circumstances, it is almost impossible to resist the conclusion that the over-all transaction here formed a convenient trial unit and that this view conforms to reasonable expectations" (Smith v Russell Sage Coll., 54 NY2d at 193 [internal quotation marks omitted]).

Vitello v Amboy Bus Co., 83 AD3d 932 (App. Div., 2nd 2011)

Under the doctrine of collateral estoppel, a party is precluded from "relitigating in a subsequent action or proceeding an issue clearly raised in a prior action or proceeding and decided against that party or those in privity, whether or not the tribunals or causes of action are the same" (Ryan v New York Tel. Co., 62 NY2d 494, 500 [1984]). Two elements must be established: (1) that "the identical issue was necessarily decided in the prior action and is decisive in the present action"; and (2) that the precluded party "must have had a full and fair opportunity to contest the prior determination" (D'Arata v New York Cent. Mut. Fire Ins. Co., 76 NY2d 659, 664 [1990]). Collateral estoppel is applicable to quasi-judicial determinations of administrative agencies, including the WCB (see Ryan v New York Tel. Co., 62 NY2d at 499; O'Gorman v Journal News Westchester, 2 AD3d 815, 816 [2003]; Rigopolous v American Museum of Natural History, 297 AD2d 728, 729 [2002]).

Here, the Decision of the WCB does not collaterally estop the defendant from arguing that it was the plaintiff's employer, because there is no indication in the record that this was a disputed issue at the workers' compensation proceeding or that the WCB specifically adjudicated this issue (see Weitz v Anzek Constr. Corp., 65 AD3d 678, 679 [2009]; Caiola v Allcity Ins. Co., 257 AD2d 586, 587 [1999]). Therefore, the Supreme Court improperly concluded that the defendant was collaterally estopped from arguing that it was the plaintiff's employer.

John Hollings, Inc. v Nick & Duke, LLC, 83 AD3d 444 (App. Div., 1st 2011)

The issue whether plaintiff was wrongfully deprived of its use of the subject premises was fully and fairly litigated, and necessarily decided, in the prior Civil Court proceeding (see Ryan v New York Tel. Co., 62 NY2d 494, 500 [1984]). Plaintiff's eviction was based on uncured lease violations alone and had no connection to the wrongs it alleges against defendants in this action.

We find that plaintiff's conduct in commencing this action was frivolous within the meaning of 22 NYCRR 130-1.1.

Town of Huntington v Beechwood Carmen Bldg. Corp., 82 AD3d 1203 (App. Div., 2nd 2011)

"Under the doctrine of res judicata, a disposition on the merits bars litigation between the same parties or those in privity with them of a cause of action arising out of the same transaction or series of transactions as a cause of action that either was raised or could have been raised in the prior proceeding" (Goldstein v Massachusetts Mut. Life Ins. Co., 32 AD3d 821, 821 [2006]; see Greenstone/Fontana Corp. v Feldstein, 72 AD3d 890, 893 [2010]). "A stipulation of discontinuance with prejudice without reservation of right or limitation of the claims disposed of is entitled to preclusive effect under the doctrine of res judicata" (Liberty Assoc. v Etkin, 69 AD3d 681, 682-683 [2010]; see Greenstone/Fontana Corp. v Feldstein, 72 AD3d at 893). Here, the Town's current claims against SBJ were either raised or could have been raised in the previous action which was discontinued with prejudice against SBJ and, thus, the Town is precluded under principles of res judicata from litigating claims against SBJ arising from the same transaction. Accordingly, the complaint was properly dismissed insofar as asserted against SBJ.

OrthoTec, LLC v Healthpoint Capital, LLC, 2011 NY Slip Op 04533 (App. DIv., 1st 2011)

To be sure, "collateral estoppel will bar the subsequent independent action . . . if . . . the moving party was in fact given a hearing on the motion that was the equivalent of a trial with oral testimony" (id. at 668, 123 Cal Rptr 2d at 170-171 [emphasis added]). However, plaintiff was not given such a hearing. It was given the opportunity for a hearing, but it chose not to exercise that opportunity.

Defendants' reliance on Barker v Hull (191 Cal App 3d 221, 226, 236 Cal Rptr 285, 289 [1987]) is unavailing, since the evidence on the motion which led to the decision to which defendants seek to give preclusive effect was indeed restricted.

Dier v Suffolk County Water Auth., 2011 NY Slip Op 03993 (App. Div., 2nd 2011)

The Supreme Court erred in concluding that the appellant is estopped from asserting a defense based on the plaintiff's failure to serve a timely notice of claim. Equitable estoppel against a public corporation will lie only when the conduct of the public corporation was calculated to, or negligently did, mislead or discourage a party from serving a timely notice of claim, and when that conduct was justifiably relied upon by that party (see Bender v New York City Health & Hosps. Corp., 38 NY2d 662; Dorce v United Rentals N. Am., Inc., 78 AD3d 1110, 1111; Vandermast v New York City Tr. Auth., 71 AD3d 1127; Mohl v Town of Riverhead, 62 AD3d 969; Wade v New York City Health & Hosps. Corp., 16 AD3d 677). Here, the plaintiff failed to demonstrate that the appellant engaged in any misleading conduct that would support a finding of equitable estoppel (see Dorce v United Rentals N. Am., Inc., 78 AD3d at 1111; Wade v New York City Health & Hosps. Corp., 16 AD3d 677; Walter H. Poppe Gen. Contr. v Town of Ramapo, 280 AD2d 667, 668; Cappadonna v New York City Tr. Auth., 187 AD2d 691, 692; Nicholas v City of New York, 130 AD2d 470). The fact that the appellant conducted an examination pursuant to General Municipal Law § 50-h prior to making its motion to dismiss does not justify a finding of estoppel (see Hochberg v City of New York, 63 NY2d 665; Wade v New York City Health & Hosps. Corp., 16 AD3d 677; Rodriguez v City of New York, 169 AD2d 532, 533; Ceely v New York City Health & Hosps. Corp., 162 AD2d 492). Accordingly, the appellant's motion, in effect, to dismiss the complaint insofar as asserted against it for the plaintiff's failure to serve a timely notice of claim pursuant to General Municipal Law § 50-e(5) should have been granted.

Collateral Estoppel and Article 75

Matter of Falzone (New York Cent. Mut. Fire Ins. Co., 2010 NY Slip Op 07417 (Ct. App. 2010)

At the hearing in the SUM arbitration, held about two months after the decision in the no-fault arbitration, respondent again argued that the injury was unrelated to the accident, while petitioner countered that the SUM arbitrator was bound by the prior determination of the no-fault arbitrator under the doctrine of collateral estoppel. After the hearing, in August 2008, the SUM arbitrator issued an award in favor of respondent denying SUM benefits. In a finding directly opposite that of the no-fault arbitrator, the SUM arbitrator concluded that petitioner's injury was not caused by the accident, and also found that her recovery from the other driver was more than adequate compensation for any injuries sustained in the accident.

***

In this appeal, we are merely applying this State's well-established rule that an arbitrator's rulings, unlike a trial court's, are largely unreviewable (see Board of Educ. of Patchogue-Medford Union Free School Dist. v Patchogue-Medford Congress of Teachers (48 NY2d 812, 813 [1979] [this Court, addressing the doctrine of res judicata, held that if a grievance is within the scope of the arbitration agreement and would do no harm to the State's public policy in favor or arbitration, further judicial inquiry into arbitrability is foreclosed and "any remaining questions, including whether a prior award constitutes a bar to the relief sought, are within the exclusive province of the arbitrator to resolve" [citations omitted]; Matter of City School Dist. of City of Tonowanda v Tonawanda Educ. Assn., 63 NY2d 846, 848 [1984] ["The effect, if any, to be given to an earlier arbitration award in subsequent arbitration proceedings is a matter for determination in that forum."]; compare with Clemens v Apple, 65 NY2d 746 [1985] and Matter of American Ins. Co. [Messinger—Aetna Cas. & Sur. Co.], 43 NY2d 184, 191 [1977] [holding that if an issue between identical parties is resolved in an arbitration proceeding, the determination as to that issue may be binding on subsequent court proceedings under the doctrine of collateral estoppel where the parties have had a full and fair opportunity to litigate the issue]). Thus, if a court makes an error and fails to properly apply collateral estoppel, the issue can be reviewed and corrected on appeal. By contrast, if an arbitrator erred in not applying collateral estoppel, the general limitation on judicial review of arbitral awards precludes a court from [*4]disturbing the decision unless the resulting arbitral award violates a strong public policy, is irrational, or clearly exceeds a specifically enumerated limitation on the arbitrator's power.

Here, the prior (no-fault) arbitration award involved the same parties, the same accident, the same injuries, and resolution of the same issue (causation) as the subsequent (SUM) arbitration award. Respondent insurer, a party to the prior arbitration, lost on the causation issue. Petitioner, the prevailing party on that issue in the prior arbitration, reasonably argued that collateral estoppel should apply to bar relitigation of the causation issue in the subsequent SUM arbitration. The SUM arbitrator rejected petitioner's argument, had the parties relitigate the causation issue and, contrary to the no-fault arbitrator's determination, found in respondent insurer's favor on the causation issue.

It is not for us to decide whether the SUM arbitrator erred in not applying collateral estoppel (i.e., not giving preclusive effect to the no-fault arbitrator's determination on the issue of causation). Because the SUM arbitration award was not patently irrational or so egregious as to violate public policy, the instant SUM arbitration award (and whether the SUM arbitrator erred or exceeded his authority) is beyond this Court's review powers.

Since the instant claim involves the doctrine of collateral estoppel, not res judicata, petitioner's reliance on Appellate Division decisions barring subsequent arbitrations on res judicata grounds is misplaced.

Note the dissent.

 

The bold is mine.

 

Collateral Estoppel

This case, by itself, doesn't tell you much.  But if you look at the links, well, that helps.

Verch v Peter Charles Assoc., Ltd., 2010 NY Slip Op 06788 (App. Div., 2nd 2010)

Contrary to the plaintiffs' contention, the doctrine of collateral estoppel is inapplicable to the instant case, as there was no prior action in which the respondents had a full and fair opportunity to litigate the issues raised in the sixth cause of action of the amended complaint (see Kaufman v Eli Lilly & Co., 65 NY2d 449, 455; Sneddon v Koeppel Nissan, Inc., 46 AD3d 869, 870; G. Rama Constr. Enters., Inc. v 80-82 Guernsey St. Assoc., LLC, 43 AD3d 863, 865; Fischer v Sadov Realty Corp., 34 AD3d 632, 633)

The bold is mine.

On Collateral Estoppel

Frankel v J. P. Morgan Chase & Co., 2010 NY Slip Op 06476 (App. Div., 2nd 2010)

We reject the appellants' argument that the Second Circuit's order should be given collateral estoppel effect on the issue of whether the powers of attorney were in fact irrevocable. For collateral estoppel to be invoked, "[t]here must be an identity of issue which has necessarily been decided in the prior action and is decisive of the present action, and there must have been a full and fair opportunity to contest the decision now said to be controlling" (Buechel v Bain, 97 NY2d 295, 303-304, cert denied 535 US 1096; see Tydings v Greenfield, Stein & Senior, LLP, 11 NY3d 195, 199). Furthermore, collateral estoppel is available "only when it is clear that the prior determination squarely addressed and specifically decided the issue" (O'Connor v G & R Packing Co., 53 NY2d 278, 280). The Second Circuit's order does not expressly determine the issue of whether the powers of attorney are revocable, nor, under the circumstances, can we say that the order "necessarily decided" that issue (see Buechel v Bain, 97 NY2d at 303). It is not appropriate to speculate as to what questions may have been considered by the Second Circuit and, therefore, we reach the issue of whether the powers of attorney were revocable.

The bold is mine.

Oral Decision, Not Reduced to Writing, Does Not Get Res Judicata Effect (last case)

Res Judicata
Collateral Estoppel
Law of the Case

Specialized Indus. Servs. Corp. v Carter, 2009 NY Slip Op 09018 (App. Div., 2nd, 2009)

In the underlying action, judgment was entered against the plaintiff upon its default in answering or appearing. The plaintiff obtained an order vacating the default judgment, which was ultimately reversed by this Court (see Dave Sandel, Inc. v Specialized Indus. Servs. Corp., 35 AD3d 790). Generally, a party who has lost a case as a result of alleged fraud or false testimony cannot collaterally attack the judgment in a separate action for damages against the party who adduced the false evidence, and the plaintiff's remedy lies exclusively in moving to vacate the default judgment (see North Shore Envtl. Solutions, Inc. v Glass, 17 AD3d 427; Retina Assoc. of Long Is. v Rosberger, 299 AD2d 533; New York City Tr. Auth. v Morris J. Eisen, P.C., 276 AD2d 78, 87; Yalkowsky v Century Apts. Assoc., 215 AD2d 214, 215). Under an exception to that rule, a separate lawsuit may be brought where the [*2]alleged perjury or fraud in the underlying action was "merely a means to the accomplishment of a larger fraudulent scheme" (Newin Corp. v Hartford Acc. & Indem. Co., 37 NY2d 211, 217) which was "greater in scope than the issues determined in the prior proceeding" (Retina Assoc. of Long Is. v Rosberger, 299 AD2d at 533 [internal quotation marks omitted]). The plaintiff here, in its amended verified complaint and supplemental affidavits, has sufficiently alleged a larger fraudulent scheme to fit within the exception to the rule against collateral attack (see New York City Tr. Auth. v Morris J. Eisen, P.C., 276 AD2d at 80, 87-88; cf. North Shore Envtl. Solutions, Inc. v Glass, 17 AD3d at 428).

Contrary to the defendant's contention, the first cause of action in the amended verified complaint is not barred by the doctrine of res judicata since the Judiciary Law cause of action did not arise out of the factual transaction which was the subject matter of that action (see Matter of Hodes v Axelrod, 70 NY2d 364, 372; Mahler v Campagna, 60 AD3d at 1011; Lazides v P & G Enters., 58 AD3d 607, 609; Triboro Fastener & Chem. Prods. Corp. v Lee, 236 AD2d 603, 603-604). Nor is the first cause of action precluded by principles of collateral estoppel in that the claim was not litigated in the underlying action and much of the evidence upon which the plaintiff relies was discovered subsequent to entry of the default judgment in the underlying action (see Kaufman v Eli Lilly & Co., 65 NY2d 449, 456-457; Izko Sportswear Co., Inc. v Flaum, 25 AD3d at 537; Chambers v City of New York, 309 AD2d 81, 85).

Man Choi Chiu v Chiu, 2009 NY Slip Op 08792, (App. Div., 2nd, 2009)

On a prior appeal in this action, this Court affirmed, inter alia, the Supreme Court's determination to award an attorney's fee to the plaintiffs (see Man Choi Chiu v Chiu, 38 AD3d 619). Thus, the doctrine of the law of the case (see People v Evans, 94 NY2d 499, 502) precludes consideration of whether the plaintiffs were properly awarded an attorney's fee (see Matter of Pantelidis v New York City Bd. of Stds. & Appeals, 43 AD3d 314, affd 10 NY3d 846; Toyos v City of New York, 54 AD3d 628; Combier v Anderson, 34 AD3d 333).

As a general rule, we do not consider any issue raised on a subsequent appeal that was raised, or could have been raised, in an earlier appeal that was dismissed for lack of prosecution, although we have the inherent jurisdiction to do so (see Rubeo v National Grange Mut. Ins. Co., 93 NY2d 750; Bray v Cox, 38 NY2d 350). Here, the defendants appealed from an order of the Supreme Court dated September 7, 2007, which, inter alia, denied their motion to cancel the hearing on the issue of the amount of attorney's fees to be awarded. That appeal was dismissed by decision and order on motion of this Court dated June 18, 2008, for failure to prosecute. We decline to exercise our discretion to determine the merits of that appeal on the instant appeal from the judgment, as amended (see Bray v Cox, 38 NY2d [*2]350; Blue Chip Mtge. Corp. v Strumpf, 50 AD3d 936, 937).

Jespersen v Li Sheng Liang, 2009 NY Slip Op 09000 (App. Div., 2nd, 2009)

As a general rule, a dismissal "with prejudice" signifies that the court intended dismiss the action "on the merits" (Yonkers Contr. v Port Auth. Trans Hudson Corp., 93 NY2d 375, 380). However, an oral decision which has never been reduced to a written order or judgment is not entitled to res judicata effect and thus is ineffective as a bar to subsequent proceedings (see Towne v Asadourian, 277 AD2d 800; Begelman v Begelman, 170 AD2d 562; see also 73 NY Jur 2d, Judgments §§ 354, 436, 437). Moreover, it is clear from the hearing transcript, as well as from the order appealed from, that the Supreme Court did not intend its dismissal of the first action to be on the merits. In addition, while a "duplicate" action is subject to dismissal pursuant to CPLR 3211(a)(4), there was no procedural bar to the plaintiff commencing the second action before the first action had been dismissed.

The bold is mine.

Res Judicata, Collateral Estoppel, and Law of the Case

Res Judicata

Collateral Estoppel

Law of the Case

State Farm Ins. Co. v Frias, 2009 NY Slip Op 07825 (App. Div., 2nd, 2009)

State Farm argued that, because the three nondefaulting defendants had not proposed a counter-judgment, had not opposed State Farm's proposed judgment, had not moved for leave to renew or reargue, had not moved to vacate the judgment, and had not appealed from the judgment, they were estopped from challenging the declarations contained in it. Luccme and Urena opposed State Farm's motion and, in an order entered April 10, 2008, the Supreme Court granted the motion based on the failure of the nondefaulting defendants to oppose the proposed judgment. Luccme and Urena appeal from the resulting judgment. We reverse.

Inasmuch as State Farm initially moved for leave to enter a default judgment against the defaulting defendants only, the resulting judgment binds only those defendants, and may not be given preclusive effect to deprive Luccme and Urena, who appeared in the action, of their right to litigate the issues pertaining to coverage (see American Motorists Ins. Co. v North Country Motors, 57 AD2d 158, 160). Accordingly, we reverse the order insofar as appealed from.

But what about privity.

Shelley v Silvestre, 2009 NY Slip Op 07822 (App. Div., 2nd, 2009)

"Under the doctrine of res judicata, a final disposition on the merits bars litigation between the same parties of all other claims arising out of the same transaction or out of the same or related facts, even if based upon a different theory involving materially different elements of proof. The rule applies not only to claims litigated but also to claims that could have been raised in the prior litigation" (Matter of City of New York v Schmitt, 50 AD3d 1032, 1033 [citations omitted]; see Matter of Reilly v Reid, 45 NY2d 24, 30). The claims raised in the instant complaint were raised or could have been raised during a prior action between the same parties, which was disposed of on the merits. Accordingly, the plaintiffs' complaint was properly dismissed as barred by the doctrine of res judicata (see Town of New Windsor v New Windsor Volunteer Ambulance Corps, Inc., 16 AD3d 403, 404-405; Slavin v Fischer, 160 AD2d 934, 934-935).

Lighthouse 925 Hempstead, LLC v Citibank, N.A., 2009 NY Slip Op 07597 (App. Div., 2nd, 2009)

"Res judicata serves to bar future litigation between the same parties or those in privity with the parties of a cause of action arising out of the same transaction or series of transactions as a cause of action that was raised in a prior proceeding" (Winkler v Weiss, 294 AD2d 428, 429; see Matter of ADC [*2]Contr. & Constr., Inc. v Town of Southampton, 50 AD3d 1025, 1026). The fact that causes of action may be stated separately or invoke different legal theories will not permit relitigation of claims (see Matter of Hodes v Axelrod, 70 NY2d 364, 372; see also Matter of ADC Contr. & Constr., Inc. v Town of Southampton, 50 AD3d at 1025).

Here, both this action and the prior action arise from the same transaction, namely the defendants' alleged failure to remove a drive-thru ATM. The fact that Lighthouse now invokes the legal theory of trespass instead of breach of contract, which it argued in the prior action, will not permit it to relitigate the claim. Therefore, the Supreme Court properly granted the defendants' motion for summary judgment dismissing the complaint on the ground that it was barred by res judicata.

Frankson v Brown & Williamson Tobacco Corp., 2009 NY Slip Op 06799 (App. Div., 2nd, 2009)

As a general rule, the law of the case doctrine precludes this Court from re-examining an issue which has been raised and decided against a party on a prior appeal where that party had a full and fair opportunity to address the issue (see People v Evans, 94 NY2d 499, 502; Allison v Allison, 60 AD3d 711; Lipp v Port Auth. of N.Y. and N.J., 57 AD3d 953, 954; Town of Massena v Healthcare Underwriters Mut. Ins. Co., 40 AD3d 1177, 1197). Unlike res judicata and collateral estoppel, which "are rigid rules of limitation," the law of the case doctrine "is a judicially crafted policy that expresses the practice of courts generally to refuse to reopen what has been decided, [and is] not a limit to their power'" (People v Evans, 94 NY2d at 503, quoting Messenger v Anderson, 225 US 436, 444). Thus, while the law of the case doctrine is intended to foster "orderly convenience" (Foley v Roche, 86 AD2d 887, 887), it is not an absolute mandate which limits an appellate court's power to reconsider issues where there are extraordinary circumstances, "such as subsequent evidence affecting the prior determination or a change of law" (Lipp v Port Auth. of N.Y. and N.J., 57 AD3d at 954; see People v Evans 94 NY2d at 503; J-Mar Serv. Ctr., Inc. v Mahoney, Connor & Hussey, 45 AD3d 809; Foley v Roche, 86 AD2d at 887).

Guided by these principles, we agree that the law of the case doctrine precludes us from reconsidering the issues of whether the trial court applied an appropriate standard for the admissibility of scientific evidence, and whether punitive damages were properly assessed against the Tobacco Institute and the Tobacco Council. These issues were raised by the defendants and decided against them on the prior appeals, and there are no new factual circumstances or change in the law which would warrant our reconsideration (see Pekich v James Lawrence, Inc., 38 AD3d 632, 633; Quinn v Hillside Dev. Corp., 21 AD3d 406, 407; Wendy v Spector, 305 AD2d 403).

All the bold is mine.

Collateral Estoppel & Law of the Case & CPLR § 3215(c)

Collateral Estoppel

Law of the Case

CPLR § 3215(c) Failure to take a default within a year

New York Cent. Mut. Fire Ins. Co. v Barry, 2009 NY Slip Op 05096 (App. Div., 2nd, 2009)

The facts of this case are set forth in prior appeals to this Court relating to this matter (see Barry v Hildreth, 9 AD3d 341; New York Cent. Mut. Fire Ins. Co. v Hildreth, 40 AD3d 602).

Contrary to the defendant's contention, the plaintiff established its entitlement to judgment as a matter of law. The plaintiff's claim for equitable subrogation was not barred by the general release executed by the plaintiff's insured (see Fasso v Doerr, 12 NY3d 80, 88; Aetna Cas. & Sur. Co. v Bekins Van Lines Co., 67 NY2d 901, 902; Ocean Acc. & Guar. Corp. v Hooker Electrochemical Co., 240 NY 37; Group Health, Inc. v Mid-Hudson Cablevision, Inc., 58 AD3d 1029; New York Cent. Mut. Fire Ins. Co. v Hildreth, 40 AD3d 602; Travelers Prop. Cas. v Giorgio, 21 AD3d 1086; Lesnick & Mazarin v Cutler, 255 AD2d 367; Silinsky v State-Wide Ins. Co., 30 AD2d 1, 3). Further, the plaintiff's claim was not barred by collateral estoppel. The plaintiff's insured's apparent abandonment, pursuant to CPLR 3215( c), of a counterclaim against the defendant for contribution cannot be characterized as an adjudication on the merits (see Sanders v Marino Falcone Brick Contr., 133 AD2d 342), precluding further litigation (see Bank of N.Y. v LS Monticello JV, 209 AD2d 464; see Peterson v Troy, 96 AD2d 856). In opposition, the defendant failed to raise a triable issue of fact.

Northbay Constr. Co., Inc. v Bauco Constr. Corp., 2009 NY Slip Op 05753 (App. Div., 2nd, 2009)

On a prior appeal by the defendants in both actions (hereinafter the defendants) (see Northbay Constr. Co., Inc. v Bauco Constr. Corp., 38 AD3d 737), this Court reversed an interlocutory judgment in favor of the plaintiffs in both actions (hereinafter the plaintiffs) directing an accounting and imposing a constructive trust, and remitted the matter to the Supreme Court, Westchester County, for a new trial, with costs to abide the event. In response to this determination, the defendants moved by order to show cause for summary judgment based, inter alia, upon the decision and order of this Court and arguments that the plaintiffs failed to submit sufficient evidence at the trial. Prior to the commencement of the new trial, the plaintiffs cross-moved for summary judgment, contending that the testimony of the defendant Dominick Bauco at the first trial established their entitlement to judgment as a matter of law. [*2]

The Supreme Court, in the order appealed from, awarded the plaintiffs partial summary judgment in the sum of $27,345.50, based upon a concession by the defendants, but otherwise denied the motion and cross motion on the ground, inter alia, that the decision of this Court in Northbay Constr. Co., Inc. v Bauco Constr. Corp. (38 AD3d 737), constituted law of the case.

The doctrine of law of the case requires a court to follow the determinations of a court of coordinate jurisdiction (see Mosher-Simons v County of Alleghany, 99 NY2d 214, 219). Therefore this Court is not bound by prior orders of the Supreme Court in this matter. However, this Court is bound by our own prior decisions and orders in this case (see Aames Funding Corp. v Houston, 57 AD3d 808). Further, the Supreme Court was bound to follow the remittitur of this Court (see Matter of Davis, 56 AD3d 553; Sweeney, Cohn, Stahl & Vaccaro v Kane, 33 AD3d 785), which directed a new trial. Upon remittitur, the parties submitted no new information which would warrant a different determination (see Stone v Bridgehampton Race Circuit, 244 AD2d 403).

Accordingly, the order must be affirmed insofar as appealed and cross-appealed from, and the parties should proceed to trial (see Northbay Constr. Co., Inc. v Bauco Constr. Corp., 38 AD3d 737).

The bold is mine.