Latest Decisions from the Appellate Division, Second Department

May 20, 2024 Robert Abruzzese, Courthouse Editor
Recently, the Appellate Division, Second Department issued decisions on cases involving the partial overruling of a dismissal in a fraudulent conveyance case, denial of summary judgment in a medical gloves payment dispute, upholding of a Child Victims Act lawsuit, modification of a custody order regarding educational decisions, and denial of a motion to amend a legal malpractice complaint. Brooklyn Eagle file photo by Rob Abruzzese
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Appellate Division partially overrules dismissal in fraudulent conveyance case

The Appellate Division, Second Department, has modified a Kings County Supreme Court decision and allowed several claims in a fraudulent conveyance lawsuit against 1152 53 Management, LLC, and Etty Salamon to proceed.

In August 2018, the plaintiff’s predecessor initiated a lawsuit to set aside an allegedly fraudulent conveyance by Salamon, who transferred her interest in Brooklyn property to 1152 53 Management while an action was pending against her. The plaintiff alleged the transfer was fraudulent under Debtor and Creditor Law §§ 273 to 276. The Kings County Supreme Court had dismissed the complaint against both defendants.

The Appellate Division ruled that Salamon’s motion to dismiss was untimely, as it was made after the time to serve an answer had expired without an extension request, warranting denial of her motion.

The court also found that the allegations against 1152 53 Management sufficiently stated causes of action for fraudulent conveyance under Debtor and Creditor Law §§ 273, 273-a, and 275 and that the documentary evidence provided did not conclusively refute the plaintiff’s claims. However, the court upheld the dismissal of the claim under § 274, as the complaint did not allege that Salamon was engaged in or about to engage in a business transaction for which the transfer left her with insufficient capital. Additionally, the claim under § 276 was dismissed for lacking the required particularity in its allegations of fraudulent intent.

This decision emphasizes the need for precise and timely pleadings in legal disputes over fraudulent conveyances and allows key claims to advance in the legal process.

– Old Republic National Title Insurance Company v. 1152 53 Management, LLC – 

 

Appellate Division denies summary judgment in dispute over medical gloves payment

The Appellate Division, Second Department, has modified part of, and upheld the rest of, a Kings County Supreme Court decision in the case of Kitchen Winners NY, Inc. v. David Triptow et al., ruling that the plaintiff’s motion for summary judgment was improperly granted.

In this action, Kitchen Winners NY, Inc. sought to recover a $450,000 deposit for undelivered medical gloves under a guaranty executed by the defendants. The plaintiff moved for summary judgment in lieu of a complaint, while the defendants sought to stay the action pending resolution of a related legal proceeding in China.

The Kings County Supreme Court originally granted summary judgment for the plaintiff and denied the defendants’ motion to stay. However, the Appellate Division found that the guaranty did not meet the requirements of CPLR 3213, as the determination of the defendants’ obligations required more than simple proof of nonpayment. The guaranty referenced differing deposit amounts and did not clearly establish the repayment trigger date, necessitating outside proof beyond the face of the document.

The Appellate Division upheld the lower court’s decision to deny the stay, noting that the actions in New York and China did not share complete identity of parties, claims, and reliefs sought. As a result, the Appellate Division denied the plaintiff’s motion for summary judgment and allowed the case to proceed, explaining the need for further examination of the facts.

– Kitchen Winners NY, Inc. v. Triptow – 

 

Appellate Division upholds denial of motion to dismiss in child victims act case

The Appellate Division, Second Department, has upheld a Kings County Supreme Court decision denying the defendant’s motion to dismiss a lawsuit alleging sexual assault under the Child Victims Act (CVA).

In April 2021, the plaintiff filed a lawsuit seeking damages for alleged sexual assaults committed by the defendant between 1971 and 1976, starting when the plaintiff was 11 years old. The defendants moved to dismiss the complaint, arguing the allegations were too old to be actionable.

The Kings County Supreme Court, in June 2023, denied the motion, finding the allegations fell within the revival window provided by CPLR 214-g of the CVA. The Appellate Division affirmed this decision, stating the complaint sufficiently alleged a sexual offense under Penal Law article 130, thus meeting the criteria for the CVA’s revival window.

The court emphasized that, at this stage, the allegations must be accepted as true and viewed in the light most favorable to the plaintiff. This ruling allows the case to proceed, highlighting the continuing impact of the Child Victims Act in enabling survivors to seek justice for historical abuse.

– Profeta v. Caulo – 

 

Appellate Division modifies custody order, denies father’s authority over child’s education

The Appellate Division, Second Department, modified a Kings County Supreme Court decision in the case of Mahoney v. Hughes, ruling that while the father should have decision-making authority over the child’s medical needs, he should not have final authority over educational decisions.

In this family law proceeding, Ryan Patrick Mahoney sought to modify a 2022 custody stipulation granting joint legal custody but final decision-making authority to the mother, Lauren Rita Hughes. The Kings County Supreme Court had granted Mahoney final decision-making authority over both medical and educational needs after finding a significant change in circumstances.

However, the Appellate Division determined there was a sound basis for granting the father authority over medical needs due to his demonstrated ability and interest, particularly given the mother’s refusal to enroll the child in necessary therapy. Conversely, it found no substantial basis for altering the mother’s decision-making power regarding education, citing the parents’ general agreement on educational matters. The decision reaffirms the principle that custody modifications must prioritize the child’s best interests based on the totality of circumstances.

– Matter of Mahoney v. Hughes – 

 

Appellate Division denies motion to amend complaint in legal malpractice case

The Appellate Division, Second Department, upheld a Kings County Supreme Court decision denying the plaintiff’s motion to amend his legal malpractice complaint against the defendant.

In this action, the plaintiff sought damages for alleged legal malpractice and excessive billing by the defendant, who represented him in three related legal matters. The plaintiff moved to amend his second amended complaint to reincorporate allegations of legal malpractice that had been previously omitted and to add new factual details. The Kings County Supreme Court denied this motion, citing undue delay and prejudice to the defendant.

The Appellate Division affirmed the lower court’s decision, noting that the plaintiff waited more than three years after filing the second amended complaint to seek further amendments. During this time, extensive discovery had taken place, and the plaintiff had already moved for summary judgment based on the existing complaint. The court found that allowing the amendment at this stage would unfairly surprise and prejudice the defendant, upholding the Supreme Court’s discretion in denying the motion.

This ruling emphasizes the importance of timely and consistent pleadings in litigation, particularly in complex legal malpractice cases.

– Ofman v. Bluestone – 


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