Commercial litigants often seek the provisional and equitable remedy of a preliminary injunction under Article 63 of the CPLR to protect the client’s rights that are difficult to monetize and quantify. The relief sought typically involves a party restraining from certain conduct and maintaining the status quo where it “appears that the defendant threatens or
Altering a Confession of Judgment? Think Again!
A confession of judgment has often been viewed as an important tool in settling a litigation or finalizing a transaction. In 2019, the New York State Legislature made some significant amendments to the Confession of Judgment law (CPLR § 3218), particularly eliminating the ability of creditors to file confessions of judgment against non-New York residents. As a result, the amended CPLR § 3218 provides that the confession must state the county in which “the defendant resided when it was executed,” and that the confession may only be filed in that county or, if the defendant moved to a different county within New York after signing the confession, “where the defendant resided at the time of filing.” In a recent decision, Kings County Commercial Division Justice Leon Ruchelsman addressed the damaging consequences of altering a confession of judgment to meet the “residency” requirements of CPLR § 3218.
Background
In Porges v Kleinman, plaintiff commenced an action stemming from a real estate investment opportunity in New Jersey. Specifically, plaintiff alleged that defendant pressured plaintiff to obtain a high cost loan to finance the purchase of the property while not allowing plaintiff to conduct any due diligence. Following the closing, plaintiff alleged that defendant pressured him into signing a promissory note and confession of judgment for $675,000.00. Approximately a year after the closing, defendant commenced a separate action, which was later consolidated with the present action, to enforce the confession of judgment due to plaintiff’s alleged failure to make any payments towards the promissory note.
During the course of the litigation, plaintiff brought a motion to vacate the confession of judgment, arguing that the confession of judgment (i) did not specify the county in which plaintiff resided; and (ii) was altered by striking out “County of New York” and writing in “County of Kings” in the caption. In opposition, defendant argued that the alteration of the caption was made at the express instruction of the Kings County Clerk’s office to allow for the confession of judgment to be filed in the appropriate venue.
Continue Reading Altering a Confession of Judgment? Think Again!Where’s the Beef? Causation and Culpability Are Fatal Pitfalls in Zaycon Foods Lawsuit
When representing an aggrieved plaintiff in a commercial matter, there are certain business torts that I tend to rely on more heavily than others. If business torts were foods, for example, a claim like breach of contract would be an entrée, while tortious interference with prospective business relations would be more of a side dish. Those types of tort-lite claims are difficult to plead (and even more difficult to prove) because they require a showing of causation and culpability, the lack of which is fatal if not appropriately pleaded as Justice Robert R. Reed reminds us in Braddock v Shwarts and Vertical Group, Supreme Court, New York County (Index No. 158142/2018).
Continue Reading Where’s the Beef? Causation and Culpability Are Fatal Pitfalls in Zaycon Foods LawsuitThe Evidence Behind E-SIGS
The COVID-19 pandemic has unsurprisingly resulted in many people in the business community, including lawyers, transacting business remotely. With that uptick comes more contracts utilizing electronic signatures and remote depositions and notarizations. Not only is the use of an e-signature generally more convenient for the parties involved in a transaction, but an e-sig provides many more layers of security and protection from claims of forgery than a wet-signature because the process requires the user to confirm her identity to bind her signature to that identity through a digital certificate.
So what happens when there’s a contractual dispute, and one of the parties is seeking to enforce a contract while the counterparty is claiming that its electronic signature has been forged? On October 26, 2023, Justice Daniel J. Doyle of the Monroe County Commercial Division dealt with just that in AJ Equity Group LLC v Office Connection, Inc., in which he held that the defendant’s mere denial that she e-signed an agreement was not sufficient to dismiss a breach of contract claim, but also that the plaintiff was not entitled to summary judgment on its breach claim for failure to explain the relevance and significance of the signature certificate showing that the electronic signature was valid.
Continue Reading The Evidence Behind E-SIGSWhat’s Your Contribution? A Cautionary Tale Surrounding Third-Party Complaints
As many practitioners know, it is common to dismiss a complaint for pleading defects that are readily apparent. However, another type of complaint has recently caused a significant amount of confusion in the Commercial Division – the third-party complaint. A recent decision from Bronx Commercial Division Justice Fidel E. Gomez confirms as much, dismissing a third-party complaint where the third-party plaintiffs failed to plead any claims against the third-party defendant that were “rooted in indemnity or contribution.”
Continue Reading What’s Your Contribution? A Cautionary Tale Surrounding Third-Party ComplaintsIf the Service Was Poor, You’ll Have to Do More – How Much Diligence Is Due for Affix and Mail Service?
The burden of establishing personal jurisdiction over a defendant rests with the plaintiff. Service of process is a necessary component of jurisdiction, and it is not complete until proof of service is filed. Ordinarily, defective service of process is not a jurisdictional defect and does not warrant dismissal. But when it comes to “affix and mail” service under CPLR § 308(4), the statutory requirement of “due diligence” must be strictly observed, otherwise dismissal may result. A recent decision from Manhattan Commercial Division Justice Robert Reed in Arena Special Opportunities Fund, LLC v McDermott discusses just how much diligence is required.
Continue Reading If the Service Was Poor, You’ll Have to Do More – How Much Diligence Is Due for Affix and Mail Service?Keep it Secret, Keep it Safe: Commercial Division Protects Corporate Client Communications Under the Common-Interest Doctrine
The attorney-client privilege is an old and well-known evidentiary privilege. It fosters candor between attorney and client, protects confidential information from being revealed to others, and ensures that the attorney can render accurate and competent legal advice. On occasion, the privilege extends to third parties. For instance, the “common interest doctrine” may protect communications between business entities with common interests in a lawsuit. A recent decision from Manhattan Commercial Division Justice Robert R. Reed, West 87 LP v. Paul Hastings LLP, exemplifies how instrumental the doctrine can be in commercial practice.
Continue Reading Keep it Secret, Keep it Safe: Commercial Division Protects Corporate Client Communications Under the Common-Interest Doctrine“C’mon Ref!” – Right and Wrong Ways to Challenge the Call in a Supervised Disclosure Proceeding
Section 3104 of the CPLR authorizes courts to appoint a judge or referee to supervise disclosure proceedings. The appointed referee enjoys “all the powers of the court” to resolve discovery disputes. A party seeking review of a referee’s order must, within five days after the order is made, file a motion in the court in which the action is pending. Lawyers involved in supervised disclosure proceedings should be familiar with the requirements for review contained in CPLR 3104(d). In a recent decision from New York County’s Commercial Division, Justice Robert R. Reed reminds us that only strict adherence to those requirements will suffice to obtain review.
Continue Reading “C’mon Ref!” – Right and Wrong Ways to Challenge the Call in a Supervised Disclosure ProceedingRule Change Redux, 2022 Edition
Did you know that the New York State United Court System publishes an annual report covering the advances, challenges, and achievements in and by our New York State courts over the past year? If you did not, now is the time to head over to the NYCourts website and browse the recently released 45th Annual
A Reminder From The Commercial Division That Disloyalty Doesn’t Pay … Literally!
It is no secret that employees are often the most likely people to misappropriate an employer’s confidential information or valuable trade secrets. In this particular situation, employers have many options at their disposal, including asserting a claim under the faithless-servant doctrine. In a recent decision from the Manhattan Commercial Division, Justice Melissa A. Crane