Commercial Division Blog

Posted: April 1, 2018 / Categories Commercial, Jurisdiction, Settlements

Court Lacks Jurisdiction to Decide Motions Filed After Action Voluntarily Discontinued

On March 13, 2018, Justice Knipel of the Kings County Commercial Division issued a decision in Nemirovsky v. Brailovskiy, 2018 NY Slip Op. 30432(U), dismissing motions filed after an action was voluntarily discontinued for lack of jurisdiction, explaining:

Based upon the review of the parties' submissions and the record adduced in this matter, it is the finding of this court that because the instant action was discontinued by stipulation of discontinuance signed by counsel for all parties and filed on March 17, 2016, the court is without jurisdiction to determine the motions presently before it. CPLR 3217(a)(2) provides:

(a) Without an order. Any party asserting a claim may discontinue it without an order
* * *
2. by filing with the clerk of the court before the case has been submitted to the court or jury a stipulation in writing signed by the attorneys of record for all parties, provided that no party is an infant, incompetent person for whom a committee has been appointed or conservatee and no person not a party has an interest in the subject matter of the action.

Although a trial court has the power to exercise supervisory control over all phases of pending actions and proceedings, it lacks jurisdiction to entertain a motion after the action has been unequivocally terminated by the execution of an express, unconditional stipulation of discontinuance.

When an action is discontinued, it is as if it had never been; everything done in the action is annulled and all prior orders in the case are nullified. Because the court is divested of jurisdiction by reason of the discontinuance, it may not even entertain a motion to vacate the stipulation of discontinuance and restore the action; the movant must instead commence a new plenary action.

(Internal quotations and citations omitted) (emphasis added).

The courts favor voluntary settlements of disputes; indeed, most complex commercial litigations settle before trial. As this decision shows, once an action is discontinued, it is as if it had never occurred. Contact Schlam Stone & Dolan partner John Lundin at if you or a client have questions regarding the effect of an earlier settlement and discontinuance.