Justia New York Court of Appeals Opinion Summaries

In this dispute between two Major League Baseball (MLB) teams and their co-owned regional sports network the Court of Appeals affirmed as modified the judgment of the court of appeals affirming the confirmation of a second arbitration award and directed that a money judgment be vacated, holding that the highly sophisticated parties were bound to the terms of their agreement.In this dispute regarding the fair market value of certain telecast rights Plaintiffs sought to vacate an arbitration award granted by the MLB's Revenue Sharing Definitions Committee (RSDC). Supreme Court vacated the arbitration award based on the RSDC's evident partiality, and the appellate division affirmed. After a second hearing, the RSDC entered a second award. Supreme Court affirmed, and the appellate division affirmed. The Court of Appeals affirmed as modified, holding (1) the courts below correctly confirmed the second arbitration award; and (2) the order must be modified because Supreme Court erred by awarding prejudgment interest and rendering a money judgment. View "TCR Sports Broadcasting Holding, LLP v. WN Partner, LLC" on Justia Law

The Court of Appeals reversed the judgment of the appellate division affirming the judgment of Supreme Court granting Defendant's motion to dismiss this breach of contract action for lack of personal jurisdiction, holding that jurisdiction was proper under New York's long-arm statute, N.Y. C.P.L.R. 302(a)(1).Defendant, a Delaware corporation headquartered in Michigan, designed and manufactured unmanned aerial vehicles (UAV). Defendant sold two UAVs to the State University of New York at Stony Brook for delivery in Madagascar. The State commenced this action on behalf of the university following a dispute regarding the operability of the UAVs, alleging breach of contract and other claims. Supreme Court granted the motion, and the appellate division affirmed. The Court of Appeals reversed, holding that there was personal jurisdiction over Defendant pursuant to the "transacts any business" clause of New York's long-arm statute. View "State v. Vayu, Inc." on Justia Law

The Court of Appeals held that Plaintiffs' original complaint alleging that Defendant breached the parties' written insurance policy and that Plaintiffs had fully complied with the requirements contained in the policy failed to give Defendant the requisite notice of the "transactions, occurrences, or series of transactions or occurrences, to be proved" in support of Plaintiff's reformation claim, as required under N.Y. C.P.L.R. 203(f).Defendant, an insurance company, issued Plaintiffs, two limited liability companies, a multi-million dollar, written insurance policy covering many of Plaintiffs' vacant commercial properties. Plaintiffs later brought this action for breach of contract seeking damages based on Defendant's failure to cover damages incurred after a fire on the premises. A jury returned a verdict in favor of Plaintiffs on the reformation claim, and the appellate division affirmed. The Court of Appeals reversed, holding that Plaintiffs' complaint failed to give notice to Defendant of the transactions or occurrences on which Plaintiffs based their reformation claim. View "34-06 73, LLC v. Seneca Insurance Co." on Justia Law

The Court of Appeals reversed the order of the appellate division in this case, holding that an indemnification provision in the partnership agreement between Plaintiff and Defendant lacked express language or indicia of the parties' "unmistakably clear" intent to indemnify each other for attorney's fees in an action between them concerning the contract.After Defendant unsuccessfully brought a partnership dissolution action Plaintiff commenced this action seeking attorney's fees and costs incurred defending the dissolution action, claiming that Defendant waived the benefit of the American Rule, under which a prevailing party in litigation generally may not recover attorney's fees from the losing party, by agreeing to the indemnification provision in the parties' partnership agreement. Supreme Court granted summary judgment for Defendant, and appellate division affirmed. The Court of Appeals affirmed, holding that nothing in the agreement made "unmistakably clear" that the partners intended to permit recovery for attorney's fees in an action between them on the contract. View "Sage Systems, Inc. v. Liss" on Justia Law

In response to questions certified to it by the United States Court of Appeals for the Second Circuit, the Court of Appeals held that inferences of vesting of retiree health insurance rights when construing a collective bargaining agreement (CBA) are inconsistent with New York's established contract interpretation principles.In Kolbe v. Tibbetts, the Court of Appeals left open the question of whether a New York court should infer vesting of retiree health insurance rights when construing a collective bargaining agreement (CBA). The Supreme Court rejected such inferences as incompatible with ordinary contract principles under federal law, thus repudiating International Union, United Automobile, Aerospace, & Agriculture Implement Workers of America v. Yard-Man, Inc., 716 F2d 1476 (6th Cir 1983). In answering the questions certified to it in this case, the Court of Appeals (1) held that it maintains its traditional contract interpretation principles, including those set forth in Kolbe; but (2) clarified that New York's contract law does not recognize Yard-Man-type inferences. View "Donohue v. Cuomo" on Justia Law

In these four appeals turning on the timeliness of a mortgage foreclosure claim and involving the intersection of contracts affecting real property ownership and the application of the statute of limitations, the Court of Appeals held that the Appellate Division order in each case must be reversed.In two cases, the issue was when the maturity of the debt was accelerated, commencing the six-year statute of limitations period. The remaining issues in the other cases turned on whether the noteholder's voluntary discontinuance of a prior foreclosure action revoked acceleration of the debt, thus reinstating the borrower's right under contract to repay the loan in installments. The Court of Appeals held (1) in the first case, the default letter in question did not accelerate the debt; (2) in the second case, two complaints in prior discontinued foreclosure actions that failed to reference the pertinent loan were not sufficient to constitute a valid acceleration; and (3) as to the remaining issues, where the maturity of the debt has been validly accelerated by commencement of a foreclosure action, the noteholder's voluntary withdrawal of that action revokes the election to accelerate. View "Freedom Mortgage Corp. v. Engel" on Justia Law

In this residential mortgage-backed securities (RMBS) action the Court of Appeals reversed the order of the Appellate Division and reinstated the order of Supreme Court, holding that, in a breach of contract action, the public policy rule prohibiting parties from insulating themselves from damages caused by grossly negligent conduct applies only to exculpatory clauses or provisions that limit liability to a nominal sum.At issue was a contract that contained a sole remedy provision that purported to limit, but not eliminate, the remedies available to Plaintiff in the event of a breach. Plaintiff sought to avoid the provision by alleging that Defendants breached the contract with gross negligence. Supreme Court held that the sole remedy provision was enforceable. The Appellate Division reversed, concluding that Plaintiff's allegations of gross negligence were sufficient to render the sole remedy provision unenforceable. The Court of Appeals reversed, holding (1) in a breach of contract case, grossly negligent conduct will render unenforceable only exculpatory or nominal damages clauses; and (2) because the sole remedy provision at issue was not an exculpatory or nominal damages clause and was not subject to the gross negligence public policy exception, the allegations of gross negligence did not render the sole remedy provision unenforceable. View "In re Part 60 Put-Back Litigation" on Justia Law

The Supreme Court affirmed the order of the Appellate Division affirming Supreme Court's grant of summary judgment, holding that a liquidated damages provision in a Surrender Agreement between Columbia University and D'Agostino Supermarkets was an unenforceable penalty in contravention of public policy.D'Agostino and Columbia University entered into a commercial lease for D'Agostino's rental of certain floors of a building owned by Columbia. The parties later entered a Surrender Agreement that terminated the lease in exchange for D'Agostino's surrender of the premises and a staggered payment of $261,752. Columbia later commenced the underlying action to enforce the damages provision in the Surrender Agreement. Supreme Court granted D'Agostino's cross-motion for summary judgment for the requested amount and interest. The Appellate Division affirmed. The Court of Appeals affirmed, holding that the damages sought were grossly disproportionate to the amount due upon full performance of the Surrender Agreement, and therefore, there was no error in rejecting Columbia's liquidated damages provision. View "Trustees of Columbia University in City of New York v. D'Agostino Supermarkets, Inc." on Justia Law

The Court of Appeals affirmed the order of the Appellate Division affirming the judgment of Supreme Court dismissing this declaratory judgment action brought by commercial tenants who unambiguously agreed to waive the right to commence a declaratory judgment action as to the terms of their leases, holding that, under the circumstances of this case, the waiver clause was enforceable, requiring dismissal of the complaint.Plaintiffs executed two commercial leases with the predecessor-in-interest of Defendant. Each lease incorporated a rider provided that the tenant waived its right to bring a declaratory judgment action with respect to any provision of the lease. After Defendant sent notices to Plaintiffs alleging various defaults Plaintiffs commenced this action seeking a declaratory judgment that they were not in default. Supreme Court granted Defendant's motion for summary judgment and dismissed the action. The Appellate Division affirmed, determining that the declaratory judgment waiver was enforceable and barred Plaintiffs' action. The Court of Appeals affirmed, holding that the declaratory judgment waiver was enforceable, and therefore, the action was properly dismissed. View "159 MP Corp. v Redbridge Bedford, LLC" on Justia Law

The Court of Appeals accepted a question certified to it by the federal court of appeals and answered that, pursuant to the Court’s Rule 500.27, if a bond issuer remains obligated to make biannual interest payments until the principal is paid, including after the date of maturity, enforceable claims for such biannual interest do not continue to accrue after a claim for principal of the bonds is time-barred.In 1997, Defendant, the Province of Mendoza, issued bonds valued at $250 million. Plaintiff Moshe Marcel Ajdler was the beneficial owner of $7,050,000 of the principal amount. Plaintiff did not receive any scheduled interest payments or payment of his share of his principal on the maturity date. In 2017, Plaintiff brought this action seeking to collect his share of principal and interest payments to which he was entitled. The district court granted Defendant’s motion to dismiss, concluding that all claims for principal and any accrued interest were time-barred. The Second District concluded that Plaintiff’s claim for principal was untimely but certified questions as to the viability of Plaintiff’s claims to recover interest. The Court of Appeals held that in the absence of a timely action to recover principal, a bondholder cannot enforce the conditional obligation to make post-maturity interest payments. View "Ajdler v. Province of Mendoza" on Justia Law