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Posted: May 15, 2015

Prior Action Terminates for CPLR 205(a) Purposes When Appeal is Dismissed, Not When Underlying Order is Entered

On May 14, 2015, the Court of Appeals issued a decision in Malay v. City of Syracuse, 2015 NY Slip Op. 04164, holding that a “prior action terminates for the purposes of CPLR 205(a) when the intermediate appellate court dismisses the appeal, not when the underlying order appealed from is entered.”  (Emphasis added).

CPLR 205(a) provides:

If an action is timely commenced and is terminated in any other manner than by a voluntary discontinuance, a failure to obtain personal jurisdiction over the defendant, a dismissal of the complaint for neglect to prosecute the action, or a final judgment upon the merits, the plaintiff, or, if the plaintiff dies, and the cause of action survives, his or her executor or administrator, may commence a new action upon the same transaction or occurrence or series of transactions or occurrences within six months after the termination provided that the new action would have been timely commenced at the time of commencement of the prior action and that service upon defendant is effected within such six-month period. Where a dismissal is one for neglect to prosecute the action made pursuant to rule thirty-two hundred sixteen of this chapter or otherwise, the judge shall set forth on the record the specific conduct constituting the neglect, which conduct shall demonstrate a general pattern of delay in proceeding with the litigation.

In Malay, the plaintiff brought an action in federal court, which ultimately was dismissed, as to her federal claims, on summary judgment on September 30, 2011. The district court declined to assert jurisdiction over her state law claims, and so dismissed them. The plaintiff appealed to the Second Circuit, but her appeal was dismissed, effective July 10, 2012, for failing to perfect the appeal.

On June 25, 2012, before the Second Circuit dismissed her appeal, the plaintiff brought an action in state court asserting her state law claims. The trial court dismissed her claims on statute of limitations grounds, holding that they were untimely as of the filing date of the action and that the plaintiff was not entitled to the benefit of CPLR 205’s tolling provisions because nine months had elapsed between the district court’s dismissal of her claims and the commencement of the state court action. The Appellate Division affirmed. The Court of Appeals reversed, explaining:

Tracing its roots to seventeenth century England, the remedial concept embodied in CPLR 205(a) has existed in New York law since at least 1788. The statute and its predecessors were designed to insure to the diligent suitor the right to a hearing in court till he reaches a judgment on the merits, by remedying what might otherwise be the harsh consequence of applying a limitations period where the defending party has had timely notice of the action. The statute’s broad and liberal purpose is not to be frittered away by any narrow construction.

. . .

[Prior cases decided by the Court of Appeals] involved appellate court decisions on the merits . . . and this Court has not addressed the issue of when a prior action terminates for purposes of CPLR 205(a) where, as here, an appeal is taken as of right but is dismissed by the intermediate appellate court due to the plaintiff’s failure to perfect. We resolve that question now by adhering to the Lehman Bros. decision and holding that, where an appeal is taken as of right, the prior action terminates for purposes of CPLR 205 (a) when the nondiscretionary appeal is truly exhausted, either by a determination on the merits or by dismissal of the appeal, even if the appeal is dismissed as abandoned.

This interpretation of CPLR 205 is in keeping with the statute’s remedial purpose of allowing plaintiffs to avoid the harsh consequences of the statute of limitations and have their claims determined on the merits where, as here, a prior action was commenced within the limitations period, thus putting defendants on notice of the claims. In interpreting the statute, we are also mindful of judicial economy. Defendants acknowledge that attorneys routinely file notices of appeal from adverse determinations as a matter of course, and defendants posit no reasonable basis for their concern that plaintiffs will be motivated to unduly delay making a determination regarding whether to pursue their appeal or commence a new action. To the contrary, plaintiffs are generally motivated to obtain a determination on the merits in their favor as quickly as possible. Indeed, plaintiff here did not even wait until the Second Circuit’s order of dismissal was rendered before commencing her action in state court. Rather, after the pre-briefing conference, plaintiff decided to commence a state court action due, in part, to her realization that the state negligence claims would be resolved much more quickly if she commenced the new action.

Defendants’ concern that this interpretation of the statute will encourage plaintiffs to take frivolous appeals as of right that they have no intention of perfecting, while not unreasonable, is similarly overblown. A plaintiff who engages in such behavior would not be able to do so for long, inasmuch as the dismissal of the nondiscretionary appeal due to failure to perfect generally would foreclose any subsequent appeal of the same issues. Furthermore, the intermediate appellate court presumably would not vacate the dismissal of the appeal without a compelling reason to do so.

(Internal quotations and citations omitted).

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