New York Civil Law

New York State Governor Kathy Hochul Vetoes "Grieving Families Act" - Proposed Amendment to New York's Wrongful-Death Statute

Gerber Ciano Kelly Brady LLC's Brendan Fitzpatrick reports on the recent development on the proposed "Grieving Families Act" in New York:

New York’s Governor Kathy Hochul vetoed the “Grieving Families Act” (Senate Bill S74A), which would have amended New York’s wrongful-death statute. According to the Governor’s veto, the proposed bill would have “substantially” changed the nature of wrongful death claims in New York by expanding (1) the persons entitled to seek damages, “distributees,” to “surviving close family members” as determined by a jury; and (2) the categories of recoverable damages because damages would no longer be limited to pecuniary loss and would include losses for grief, anguish, loss of love, society, protection, comfort, and consortium, loss of guidance and counsel. The bill would have also extended the statute of limitations for wrongful-death claims from two years after the decedent's death to three years and six months.

Governor Hochul stated in the veto that while the bill is “well-intentioned, [it] represents an extraordinary departure from New York’s wrongful death jurisprudence and may result in significant unintended consequences.” The Governor identified the “indefinite class of beneficiaries” and the “broad and perhaps overlapping, categories of damages” that would have caused confusion. Governor Hochul recognized the potential for confusion because the bill applied to pending cases, possibly resulting in “claimants and courts” being “forced to grapple with new competing claims asserted by ‘close family members’ as well as protracted discovery and increased litigation costs, potentially upending cases far along the judicial process.” The Governor acknowledged that the bill “would increase already-high insurance burdens on families and small businesses and strain already-distressed healthcare workers and institutions. The increased costs would be particularly challenging for struggling hospitals in underserved communities.”

The Governor noted that the bill passed “without a serious evaluation of the impact of these massive changes on the economy, small businesses, individuals, and the State’s complex health care system.”  While the Governor expressed support for the intent of the bill, she cautioned that there needed to be more investigation into the potential impact on the State.

We fully expect the New York Legislature to re-visit this statute. What remains to be seen is whether the Legislature will pass a version of the statute that includes some of the changes requested by the Governor to amend New York’s existing, 170-year-old, wrongful-death statute.  

Brendan is the chair of Gerber Ciano Kelly Brady LLP's Appellate Advocacy Practice Group.

Photo credit: KC Kratt

New York State Governor Hochul Vetoes New York Bill on Wrongful Death Statute - The Grieving Families Act

New York's Governor Kathy Hochul recently vetoed The Grieving Families Act of 2023  (Download NY Gov. veto message on 2023 wrongful death bill). Governor Hochul vetoed a similar bill in 2022. The Act aimed to allow families of wrongful death victims to receive compensation for emotional anguish. New York's wrongful death statute currently limits compensation in a wrongful death action to pecuniary losses -- i.e., damages calculated based on the monetary contributions that the deceased person would have made to their family had he or she lived. The 2023 Act also sought to extend the time to commence a wrongful death action and expand the scope of eligible family members who could recover in a wrongful death action.

The justification for the Act stemmed from the claimed shortcomings of New York's wrongful death statute, which denies families the ability to seek compensation for emotional suffering caused by the loss of a loved one. The justification section of the bill stated, "The current law, over 170 years old, only awards damages for pecuniary loss, disproportionately affecting children, seniors, women, and people of color who may have little or no income. The law's narrow and inhumane language values family members solely based on their financial contributions, disregarding the emotional support, love, companionship, advice, and guidance they provide."

Vetoing the bill, Governor Hochul emphasized that the Act had the potential of significant unintended consequences, that is, "increased insurance premiums for the vast majority of consumers, as well as risk the financial well-being of [New York's] health care facilities -- most notably, for public hospitals that serve disadvantaged communities."

Governor Hochul expressed her willingness in the veto memo to consider future legislation to amend the wrongful death statute. The third time's the charm, so expect the Legislature the pass another bill either this term or in the near future. 

 

 

New York Governor Hochul Vetoes Bill Concerning General Jurisdiction Over Foreign Corporations - Doing Business in New York State

New York Governor Hochul recently vetoed a bill that could have affected companies doing business in the state. The New York Legislature may revisit a similar bill in the future, so businesses should stay vigilant.

The bill focused on New York courts' jurisdiction over lawsuits involving foreign corporations, referring to the court's authority in the state to hear cases related to those companies.

Under the bill, a foreign corporation applying to do business in New York would imply consent to the jurisdiction of New York courts. New York law does not give a straightforward definition of the term, foreign corporation—i.e., “Every corporation that is not a domestic corporation is a foreign corporation.“ “A ‘domestic corporation’ is a corporation created by or under the laws of the state, or a corporation located in [New York] and created by or under the laws of the United States, or a corporation created by or pursuant to the laws in force in [New York before April 19, 1775].”

Governor Hochul's veto prevented potential costs and inconveniences for foreign corporations, as the bill would have subjected them to lawsuits in New York regardless of their connection to the state. Hochul explained the veto aimed to avoid uncertainty for businesses and prevent burdening the judicial system. (Download Veto Message) 

General jurisdiction is not the sole way a New York court can have authority over a foreign company. The court can also consider a foreign company's connections with New York when determining jurisdictional issues. For foreign companies facing a New York lawsuit, consulting with an attorney is advisable to discuss jurisdictional issues.

New York's Justice for Injured Workers Act - New York Workers' Compensation Law

New York Governor Kathy Hochul signed a bill at the end of 2022 that impacts workers’ compensation and personal-injury lawsuits in New York. “The Justice for Injured Workers Act” adds a new section of New York’s Workers Compensation Law that bars a court or other forum from granting preclusive or collateral estoppel effect to decisions by the Workers’ Compensation Board in any other action or proceeding. The Act will impact construction-site/Labor Law personal-injury lawsuits.

Consider a litigant who claims he was injured at a construction site as an employee of a concrete subcontractor. The litigant claims he fell from a height because he was not provided with appropriate safety devices. The subcontractor has no record of the litigant’s employment or his presence at the jobsite, and has no record or report of the claimed accident. The Workers’ Compensation Board determines in the litigant’s workers’ compensation claim that he was not the subcontractor’s employee and was not present at the jobsite.

Prior to the Act, the owner, general contractor, or employer could argue in the litigant’s personal-injury action (separate from the workers’ compensation claim) that the Board’s findings precluded the litigant from arguing he was the subcontractor’s employee and was injured at the jobsite. The Act now bars a court from granting preclusive effect to the Board’s decisions except on a determination of whether there was an employer/employee relationship.

The Act cuts both ways for the plaintiffs’ and defense bar. The Act’s stated intent was to protect workers and the “no fault” nature of workers’ compensation claims, thereby favoring plaintiffs in personal-injury actions. The Act’s justification notes the “lightning-fast administrative hearings before a Worker’s Compensation Law Judge” were designed to provide quick and consistent benefits for injured workers. It also notes that the hearings “sacrifice[d]” basic procedures and evidentiary rules of  trials “to swiftly decide the claims.” Thus, the Act seeks to protect workers from having less-formal, quick administrative determinations impinge on a workers personal-injury action. As opposed to workers’ compensation claims, personal-injury actions abide by rules of evidence and allow for discovery to flesh out the issues.

The glass is half full for the defense bar, however. The Act now prevents alleged injured workers from arguing in their personal-injury lawsuits that the Board’s determination on whether the work-related accident happened or how it happened precludes the defense from proffering evidence to demonstrate otherwise. The Act’s unintended effect benefits the defense bar in the construction litigation realm, where there are frequent fraudulent claims of unwitnessed, gravity-related accidents. The plaintiffs’ bar can no longer argue that the Board’s findings on the foregoing issues are final.

The Act certainly gives the plaintiffs’ bar a boon. A plaintiff can now argue that the Board’s determination on the existence of an employer/employee relationship precludes the Supreme Court from ruling on the same issue in the plaintiff’s personal-injury lawsuit. Considering the large number of fraudulent construction-site claims in New York, many of them are questionable on the employer/employee relationship issue. In that respect, the Act helps the plaintiffs’ bar.

The Act’s impact on personal-injury lawsuits is one more reason for the insured (owner, general contractor, and subcontractors), the general liability defense attorney, and the workers’ compensation defense attorney to work closely with each other at the early stages of the litigant’s claim. The defense can stem a fraudulent claim at its inception by proving to the Board that there was no employer/employee relationship between the litigant who is claiming injuries at a construction site and the general contractor or subcontractor. Considering the plaintiff-friendly protections under Labor Law §§ 240 (1) and 241 (6), disputing every meritorious issue counts.

The Act is effective immediately.

Photo credit: Arne Hoel / World Bank (license)

New York Court of Appeals Will Hear Appeal on Applicability of Business Corporation Law § 630 to Foreign Corporations/Personal Exposure of a Corporation’s 10 Largest Shareholders

Stuto v. Kerber (Motion for leave granted on Feb. 15, 2011) 77 A.D.3d 1233 (3d Dep’t 2010)

This appeal will not only offer an analysis of Business Corporation Law § 630, it will likely also provide practitioners with a good explanation of legislative history and the interpretation of statutes. In Stuto, the plaintiff worked for the defendant, which was a defunct closely-held foreign corporation incorporated in Delaware. The plaintiff obtained a judge in Supreme Court, Albany County against the defendant based on a claim for unpaid wages. Thereafter, the plaintiff commenced the action at hand against three of the 10 largest shareholders of the defendant corporation. Supreme Court granted the defendants’ motion to dismiss the plaintiff’s complaint, holding that Business Corporation Law § 630 did not apply to foreign corporations.

The Third Department upheld Supreme Court’s dismissal, observing that section 630 “is essentially the reenactment of former Stock Corporation Law § 71 and provides that ‘[t]he [10] largest shareholders’ of a nonpublicly traded company ‘shall jointly and severally be personally liable for all debts, wages or salaries due and owing to any of its laborers, servants or employees other than contractors, for services performed by them for such corporation.” Notably, the Third Department pointed out that the former Stock Corporation Law § 71 did not apply to foreign corporations. As such, the Third Department noted that the legislative history of a particular enactment must be reviewed in light of the existing decision law which the Legislature is presumed to be familiar with and to the extent it left it unchanged, that it accepted.

The Court of Appeals will determine whether Business Corporation Law § 630 applies to foreign corporations.

 

New York Court of Appeals Hears Oral Argument on Sole Proximate Cause within Labor Law sec. 240(1) Context

The New York Court of Appeals just yesterday heard oral arguments in Gallagher v. New York Post, which concerns an issue of the sole proximate cause defense within the Labor Law context.  In Gallagher, the plaintiff injured worker fell into an opening in decking floor after the blade of a circular cut-off saw he was using became bound up in steel decking that he was cutting.  The plaintiffs moved for summary judgment on the issue of liability on their Labor Law sec. 240(1) cause of action.

The Appellate Division, First Department Majority held that the trial court properly denied the plaintiffs' motion because material issues of fact existed on whether the worker chose not to use an available safety device.  The Majority held that the evidence proffered in opposition to motion demonstrated more than "[m]ere generic statements of the availability of safety devices."  The Majority hinged this conclusion on the testimony of the worker's employer's assistant project manager, who stated that (1) he had weekly meetings with the safety specialist hired to oversee the construction project in question; (2) the ironworkers were required to use certain safety devices, such as lanyards, cables or harnesses, when working near open areas; (3) the devices were used to prevent injury in case a worker fell through an opening or off an elevated surface; (4) the safety devices were available on the job site the day the worker was injured; and (5) a standing order was in place that all workers operating around any opening in the floor were to be in a harness and tied off.

Justice Catterson, with Justice Moskowtiz joining, dissented in part and concluded that the motion should have been granted because no triable issues of fact existed regarding whether the requisite safety equipment was made available and, if so, whether the injured worker chose not to make use of it.  Justice Catterson observed that no evidence existed in the record that the worker chose not to use an available safety device.  He reasoned that every worker except the worker's employer's assistant project manager testified that no safety devices were provided to the ironworkers.  Justice Catterson pointed out that the assistant project manager's testimony did not state that the worker was told to use certain safety devices and that he declined and that he had "no good reason not to do so."

The Court of Appeals' decision will likely provide more clarification to its holdings in Montgomery v. Federal Express Corp., Cahill v. Triborough Bridge & Tunnel Auth., and Blake v. Neighborhood Hous. Servs. of N.Y. 

New York Civil Law will keep you apprised of the Court's decision.

New York Senate Considering Bill on Collateral Sources that Helps Plaintiffs and Defendants Reach Settlement

Have you had to perform the collateral source dance as a plaintiff's and defense attorney?  The parties are ready to settle but that inevitable lien puts a halt on negotiations because plaintiff's attorney wants to protect his or her client and the defense attorney doesn't want his or her client to be exposed to liability from the lienholder.

The New York Senate has referred A8114-A to its Rules Committee (see text of Bill and other information on it here: Download SCAN_35301050_000.pdf ), as the New York Assembly has passed the bill.  The bill addresses the impact of collateral source payments upon  tort claims  for  personal injury,  property  damage or wrongful death, and upon related subrogation claims.  It is worth reading the Bill's language; however, the crux of the Bill is that where the parties negotiate a settlement, it is assumed that the plaintiff has not settled in derogation of the contract between the lien-holder, and the defendant will not be subject to reimbursement for a claim from a collateral source payor, unless that payor has a statutory right to do so (i.e., a workers' compensation lien).  The Bill also addresses how collateral sources are handled where the action goes to verdict.

Notably, this Bill is one in a series of measures being introduced at the request of  the Chief Administrative Judge upon the recommendation of his Advisory Committee on Civil Practice.  Its sponsor is Kenneth Zebrowski.

New Bill Passed On City and District Court Practice - Effective Tomorrow, September 8, 2005

Effective September 8, 2005 (30 days from when Governor Pataki signed the bill), chapter 452 (see bill here: Download SCAN_35301006_000.pdf ) will go into effect, amending the New York City Civil Court Act, the Uniform District Court Act and the Uniform City Court Act, in relation to the method of commencing and filing a lawsuit.

Under chapter 452, the New York City Civil Court Act, the Uniform District Court Act and the Uniform City Court Act are amended to provide that an action is commenced by filing a summons and complaint, and a special proceeding is commenced by filing a notice of petition and petition (or order to show cause and petition).  New York's Insurance Law (sec. 5106(d)) and Workers' Compensation Law (sec. 142(7)) are also amended to provide expedited forum on whether an accident occur ed during the course of employment (Workers' Compensation Law) and an expedited eligibility hearing in a multi-carrier situation, to designate the insurer for first party benefits.