Judicial Reports:

RENT CONTROL MAVERICKS
By Mark Thompson
Posted 02-23-07
A pair of judges went out on a limb on behalf of the tenants in a rent-controlled building. The Appellate Division has hauled them back in. The wayward New York County Supreme Court justices, Paul Feinman and Faviola Soto, ruled that a provision in the city’s rent stabilization law and code that allows owners to take over “one or more dwelling units” for personal use can’t possibly mean that an owner can take over as many as six units, at least not when that is the total number of rent-controlled units left in a building.

Catherine Economakis, her husband and two children, the owners of a 15-unit building at 47 East 3rd Street in Manhattan, had been trying to do just that since 2003. They sent eviction notices to the tenants in the last six rent-controlled units, which they said they needed for themselves and other members of their extended family, who are presently packed into the top floor of a Brooklyn brownstone.

In 2005, Feinman, a judge on the Manhattan Civil Court, granted their motion for an injunction to block the eviction. Soto affirmed Feinman’s ruling. In Pultz v. Economakis a ruling handed down February 15, the Appellate Division reversed.

Feinman and Soto maintained that taking over all of the rent-controlled units in a building was the equivalent of removing the entire building from the rental market. That can’t be done without the approval of the Division of Housing and Community Renewal, and the Economakis family had obtained no such approval. In support of their interpretation, Feinman and Soto cited the city legislature’s long-standing interest in preserving the supply of regulated housing in New York City. But as the Appellate Division noted, while both judges “correctly summarized this legislative policy, they overlooked that the same legislative body also enacted a provision expressly permitting an owner to recover dwelling units for personal use and occupancy, and did so without imposing any limitation on the number of units that may be recovered.”

Others judges have considered the same issue, and come to the opposite conclusion. “With the exception of the two rulings of Supreme Court in this case, every court that has considered this issue in this Department has concluded . . . that the Legislature has never imposed a limit on the number of units that may be recovered in an owner occupancy proceeding,” the Appellate Division said.

While tenants undoubtedly appreciated the attempt by the two judges to carve out a new interpretation of the law, the Rent Stabilization
Association of New York City didn’t. The trade group for property owners filed an amicus brief asking the Appellate Division to bring the two trial judges back into line, and the appellate court obliged.

QUEENS COUNTY

INSURANCE: Justice Jaime Rios allowed Marin Mesic to proceed to arbitration with an uninsured motorist claim, even though Mesic failed to file a sworn statement with his insurance company after the alleged hit-and-run accident. That is a requirement for coverage under the supplemental uninsured motorist endorsement of his insurance policy, and his failure to take that mandatory step precludes him from making a claim, the Appellate Division said. Matter of Eveready Ins. Co. v. Mesic (February 13)

TORT: Someone removed a stop sign from an intersection, precipitating a collision between two cars. But the culprit couldn’t have been anyone working for the Brooklyn Union Gas Company, said the Appellate Division, reversing Justice Phyllis Flug for declining to let the company out of the ensuing lawsuit. The company proved that it didn’t do any work at that particular intersection around the time of the accident, so Flug should have granted its motion to dismiss. Baker v. Punancy (February 13)

DIVORCE: Justice Jeffrey Lebowitz last made an appearance in the Reversal Report in December when the Appellate Division concluded that the spousal support he ordered an ex-husband to pay was 30 percent too low, and he also should have ordered the man to hand over another $10,000 in attorney’s fees to his ex-wife. Lebowitz was reversed again in February, this time for rejecting Erika Sandy’s claim that she was entitled to a divorce on account of her ex-husband’s surly behavior. “Based upon our review of the record,” said the Appellate Division panel, “we conclude that the plaintiff established her cause of action for divorce on the ground of cruel and inhuman treatment, and should have been granted a divorce on that ground.” Sandy v. Giusto (February 13)

MEDICAL MALPRACTICE: Justice Allan Weiss allowed the attorneys for Constantine Tsatsakis to wait until after the trial had begun to tell attorneys for the doctors and hospital the name of a medical expert who they intended to call to the stand to testify about an anaesthesiologist’s alleged errors in responding when a patient went into cardiac arrest. Since the plaintiff’s attorneys had no excuse for failing to properly disclose the identity of the expert “within a reasonable time after she had been retained,” Weiss shouldn’t have allowed her to testify. The fact that he accepted her testimony was just one of the errors that Weiss made. He also failed to throw out a part of the jury’s verdict finding that the absence from the medical team of a “code leader” was a proximate cause of the plaintiff's injuries. No reasonable jury could have reached that conclusion, in the Appellate Division’s opinion. In light of the errors, the anaesthesiologist deserves a new trial, the appellate judges said. Tsatsakis v. Booth Memorial Medical Center (February 13)
 
OTHER NOTABLE REVERSALS

NEW YORK COUNTY

LANDLORD TENANT: Justice Walter B. Tolub slapped sanctions on a tenant’s attorney who sought an injunction against the landlord after the time for seeking such an injunction had expired. Tolub ruled correctly on the underlying issue regarding the untimeliness of the injunction, but there was an “insufficient basis” for the penalty Tolub imposed on the attorney, the Appellate Division said, modifying the judgment accordingly. 319 Smile Corp. v. Forman Fifth, LLC (February 13)

TORT: Justice Robert D. Lippmann should have granted Lanie Alexopoulos’s motion to compel the transit authority to produce two additional officials for depositions in a suit she filed on behalf of a family member who was killed when he fell from a packed subway platform into the path of an oncoming train. Alexopoulos made a detailed showing of the necessity for the additional depositions of the agency employees, who were in charge of safety planning and hazard assessment, because the evidence uncovered so far suggested that they had knowledge of decisions that were made to alleviate the overcrowding that authorities knew would ensue during construction on the platform. Since that issue was central to the case, Lippman should have granted the plaintiff’s request for the depositions, the Appellate Division said. Alexopoulos v. Metropolitan Transportation Authority (February 13)

INSURANCE: Justice Marcy S. Friedman insisted that the tenant in this lawsuit has a duty, spelled out in the insurance covenant of its lease, to obtain coverage for acts of terrorism. The Appellate Division disagreed. The covenant, which was added to the lease in 1989, lists a number of perils that must be insured against, including “actual physical contact of an aircraft or vehicle with the property.” It also lists hazards that can be excluded from coverage, including radioactive contamination and acts of war. Terrorism is neither included nor excluded, said the appellate judges, proceeding to point out that a contract cannot be extended beyond its plain meaning. Thus, just because the lease requires coverage for one specific type of terrorist act, an aircraft striking the building, “does not dictate the conclusion that the endorsement affords coverage for all terrorist acts, irrespective of the precipitating cause of loss,” they said in reversing Friedman’s interpretation of the insurance covenant. Tag 380, LLC v. ComMet 380, Inc. (February 13)

CRIMINAL PROCEDURE: Justice William A. Wetzel vacated a 1993 assault conviction obtained against William Cuadrado through a plea agreement on grounds that the prosecution, in an apparent oversight, failed to submit that charge along with other charges, including a murder count, to the grand jury. Though one member of the appellate panel sided with Wetzel in a lengthy dissenting opinion, the four others on the Appellate Division panel concluded that the erroneous submission to the jury of a felony offense that is not charged in the indictment and is not a lesser included offense of a crime charged in the indictment does not, in the absence of a timely objection, require that a conviction for that offense be vacated. The error was not jurisdictional, so it did not affect the court's competence to convict Cuadrado of that crime, the appellate judges said, in reinstating the conviction on the assault count. People v. Cuadrado (February 13)

ATTORNEYS FEES: Justice Marylin G. Diamond gave an outgoing law firm a 5 percent cut of a contingency fee even though the case record, as the Appellate Division saw it, demonstrated that the firm “did absolutely nothing to advance the litigation during its limited period of involvement.” The appellate panel concluded that the outgoing firm, Salzman & Winer, didn’t deserve a penny for its “extremely minimal” work on the case.  Reyes v. Wootos Realty, Inc. (February 15)

REAL ESTATE: Justice Bernard Fried concluded that the plaintiff’s consent was required for a refinancing. The Appellate Division disagreed, concluding that unambiguous language in a real estate investment agreement makes it clear that the plaintiff's consent was not required for a refinancing that satisfied the three conditions specified in the agreement. Since the 1999 refinancing at issue in the suit satisfied those conditions, it could proceed against the plaintiff’s wishes. RM 14 FK Corp. v. Bank One Trust Co., N.A. (February 15)

LABOR LAW: Justice Carol Edmead thought the owner of a building in lower Manhattan should be held to account for the injury sustained by Jorge Campoverde, an employee of an asbestos removal contractor that helped clean up the building after the Sept. 11 terrorist attack. The Appellate Division, however, noted that it was the city's Department of Environmental Protection, not the building’s owner, that evacuated the building, solicited bids for decontamination work, hired the asbestos removal firm and supervised the work, so Edmead should have dismissed the owner from the lawsuit. Campoverde v. Liberty, LLC  (February 15)

SENTENCING:  The 25-year prison term that Justice Ronald A. Zweibel imposed on Eric Edwards for his conviction on a charge of first-degree assault was “excessive,” said the Appellate Division, which cut the sentence to 15 years. People v. Edwards (February 15)

SENTENCING: Justice William A. Wetzel ruled that some of the sentences for the various sex crimes that Clarence Wood was convicted of committing should run consecutively, resulting in an aggregate term of 61 years in prison. Even prosecutors, however, conceded that the sentence for “course of sexual conduct” should run concurrently with the sentence for one of the counts of sexual abuse, since they related to the same incident, resulting in a reduction of Wood’s aggregate sentence to 47 years. People v. Wood (February 15)

BRONX COUNTY

JUVENILE: Justice Alma Cordova decided that Andre T., a recalcitrant juvenile delinquent, should remain in a detention facility, even though the Office of Children and Family Services waited until the last minute to file a petition to extend his stay until his 18th birthday, in violation of rules requiring that any such petition must be filed at least 60 days before a term in custody expires. The Appellate Division said Cordova shouldn’t have let the agency off the hook for its procedural error. If the office had only recently learned that Andre wasn’t ready for release, that might have served as a sufficient excuse for the late petition. But counselors knew well before the deadline that, as one had written, there was “no way he’s ready to be under [his mother’s] supervision at this time,” given his continued behavioral problems. The missed deadline, therefore, was “more akin to administrative neglect or failure, which excuse, without more, does not constitute good cause” for the late petition, the appellate judges concluded, reversing Cordova’s decision and releasing Andre from detention, whether he’s ready or not. Matter of Andre T. (February 13)

MEDICAL MALPRACTICE: Justice Alison Y. Tuitt meted out undeservedly harsh punishment on a medical center for failing to preserve a small object retrieved from the shoulder of a patient. The executor of the patient’s estate, who is suing the center for medical malpractice, insisted that the object may have been a drill tip mistakenly left behind after surgery. Tuitt agreed, and granted the executor’s motion to strike the defendant's answer, setting the stage for a default judgment in favor of the plaintiff. The center’s lawyers, however, insisted that it was just a suture anchor, not evidence of malpractice. The appellate judges were sympathetic to that side of the story. Since there was no indication that the doctors intentionally destroyed evidence, they concluded, the motion to strike was “more punitive than was warranted under the circumstances.” Diaz v. Rose  (February 13)

KINGS COUNTY

DEFAULT: Justice Donald Kurtz must have a soft spot in his heart for litigants who blame insurance companies for their own procrastination. He was reversed last October vacating a default judgment entered against a defendant in a personal injury suit, who blamed an insurer for its failure to answer to the suit. Kurtz was recently reversed again under similar circumstance. While he was satisfied with landlord Pearleel Gregory’s excuse for failing to respond to a lawsuit, the Appellate Division wasn’t.  Gregory blamed her failure to appear in the action — brought by a tenant who is accusing the landlord of breaching the warrant of habitability — on her insurance carrier for its delay in determining coverage, and also for her personal attorney’s neglect of the case. That excuse was “bereft of detail and corroboration,” the appellate judges said. Moreover, Gregory has given no indication that she has a meritorious defense in the case, so the default judgment that Kurtz vacated must be reinstated, they said. Canty v. Gregory (February 13)

INSURANCE: Justice Martin Schneier allowed a stevedoring company to proceed with a claim against its insurer for the partial collapse of a concrete deck under a policy provision that excludes coverage for obvious rust, corrosion and deterioration but covers structural failures attributable to “hidden decay.” The Appellate Division judges hinted that Schneier might need to check his eyesight. When they took a look at photos of the accident site, they saw abundant signs of decay that were “plainly visible.” The deck collapse, in short, was “precipitated by conditions and occurrences specifically excluded from coverage,” they concluded in dismissing the claim. Catucci v. Greenwich Insurance Co. (February 13)

INSURANCE: Justice Lawrence Knipel interpreted an ambiguous insurance policy in the insurer’s favor, in defiance of a general rule that ambiguities must be interpreted in favor of the policy holder, the Appellate Division said. As a general rule, an ambiguous policy also must be given a meaning that a reasonable policy holder would expect it to have. Knipel, however, ruled that Evanston Insurance had no duty to defend or indemnify the city in a suit filed by an employee of a contractor because, as Knipel interpreted the policy, it kicks in only if the contractor is 100 percent at fault. “Such extremely narrow coverage would be, at best, of minimal value to the reasonable businessperson,” the Appellate Division concluded, reversing Knipel and ordering the insurer to step up and defend the city in the lawsuit. City of New York v. Evanston Insurance Co. (February 13)

TORT: Justice Knipel prematurely dismissed a personal-injury suit filed by Christine Rivera, who slipped on apple juice on the floor of a gymnasium used for a summer camp. The Appellate Division concluded that there was sufficient evidence that the apple juice had been on the floor for two hours before the accident, in which case the camp counselors’ failure to clean up the gym after lunch was arguably to blame for the accident. Rivera should have been allowed to make that case in a trial, the appellate judges said. Rivera v. YMCA of Greater New York (February 13)

TORT: Justice Ira Harkavy declined to dismiss a suit against Richard Hockfield. In fact, Hockfield “established, as a matter of law, that he did not negligently operate his vehicle,” said the Appellate Division, reversing Harkavy and dismissing the complaint. Gershman v. Habib (February 13)

TORT: Justice Diana Johnson agreed with the defendants that Allan Gerson did not sustain a serious injury within the meaning of Insurance Law and dismissed his lawsuit. The Appellate Division disagreed. The orthopedic surgeon retained by the defendants to examine the plaintiff asserted that Gerson had a normal range of motion in his spine. But the surgeon failed to compare the results of the tests on Gerson with results that are considered normal, the appellate judges said. Gerson v. C.L.S. Transportation, Inc.  (February 13)

TORT: After a jury found the defendants at fault for injuries sustained by Patrick Gilbert when an elevator door closed on his hand, Justice Larry Martin threw out the verdict and ordered a new trial, accepting the defendants’ argument that the verdict was internally inconsistent. Trouble is, they waited until after the jury was dismissed to make that claim, allowing the judge with no opportunity to ask the jurors to clarify their verdict. The alleged inconsistency was “obviously known to the defendants before the jury was discharged and yet they chose not to object to the verdict at that time,” the Appellate Division noted. Martin, therefore, erred in granting their motion to set aside the verdict. Gilbert v. Kingsbrook Jewish Center (February 13)

TORT: Justice Yvonne Lewis was reversed for the fifth time in five months for failing to dismiss a suit that she should have dismissed.  This time, Lewis granted Zulaikho Iskhakova’s inexcusably tardy motion for a default judgment against a defendant who had failed to respond to a lawsuit. As the Appellate Division noted, Iskhakova “offered no reasonable excuse for failing to enter a judgment against the appellants within one year of their failure to answer,” so Lewis should have denied the motion. Iskhakova v. Klages (February 13)

TORT: Justice Arthur Schack tossed out a $76,000 judgment entered in favor of Norman E. McIntyre against a church based on the word of the pastor that the church was never served with a copy of the suit. The pastor claimed in an affidavit that the person to whom the process server delivered the suit was unknown to anyone at the church. That affidavit raises a question about whether the church was ever served, the Appellate Division agreed. But the conflicting evidence should have been aired out in a hearing before the judgment is vacated. McIntyre v. Emanuel Church of God in Christ, Inc. (February 13)

MEDICAL MALPRACTICE: Justice Joseph Levine should have tossed out a $675,650 jury verdict in favor of Oliver Pierre in a medical malpractice case, based on testimony presented by the plaintiff himself, the Appellate Division said. “Neither party's expert witness in obstetrics testified that the appellant's failure to diagnose gestational diabetes led to fetal distress in this case,” the appellate judges observed. Pierre v. Lieber (February 13)

TORT: Justice Francois Rivera declined to dismiss Sheron Stackhouse’s lawsuit despite the fact that her testimony was, as the Appellate Division put it, “confusing and imprecise.” At one point, she said a structural defect in an exterior step in front of the premises where she resided caused her to fall. She later asserted that an accumulation of ice was to blame, though she did not assert that the defendants were responsible for the ice. Given her own confusion about how she fell and who was to blame, Rivera should have dismissed Stackhouse’s complaint, the Appellate Division said. Stackhouse v. Fairfield Presidential Assoc., LP (February 13)

RICHMOND COUNTY

LABOR LAW: Justice Eric Vitaliano concluded that Michael Miano had only himself to blame for injuries he sustained when he took a spill while trying to get to the basement where he was working by stepping on the forms that had been constructed in preparation for pouring a concrete staircase. Miano, who worked for a subcontractor, should have known the forms were never intended to be used as stairs, Vitaliano reasoned. In fact, as the appellate judges noted, the general contractor’s representative at the worksite cavalierly dismissed concerns about lack of access to the basement, telling the subcontractors they would have to jump through a window, if necessary, though that wasn’t a safe alternative either.  Under the circumstances, it was unfair of Vitaliano to hold the injured worker solely responsible for his plight, the appellate judges said. Miano v. Skyline New Homes Corp. (February 13)

Posted by Dirk on February 22, 2007 07:04 PM to Judicial Reports