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Current Developments in the Commercial Divisions of the
New York State Courts by Schlam Stone & Dolan LLP
Posted: July 2, 2018

Court Should Have Transferred Case; Plaintiff Failed to Show That Chosen Venue Was Proper

On June 27, 2018, the Second Department issued a decision in Patiwana v. Shah, 2018 NY Slip Op. 04746, holding that the Supreme Court should have transferred a case because the plaintiffs failed to show that their chosen venue was proper, explaining:

CPLR 503(a) provides, in pertinent part, except where otherwise prescribed by law, the place of trial shall be in the county in which one of the parties resided when it was commenced. Here, since the plaintiff and the defendants, the only parties to this derivative action, were residents of Nassau County when it was commenced, venue was improperly placed in Queens County. Contrary to the plaintiff’s contention, the fact that two of the corporations and the LLC are located in Queens County did not make Queens County a proper venue to commence this action, since those entities are not parties to the action.

Furthermore, venue could not have been properly placed in Queens County pursuant to CPLR 507. While CPLR 507 mandates that venue of an action which seeks a judgment that will affect the title to, or the possession, use or enjoyment of, real property shall be placed in the county where the property is located, here, the action seeks, inter alia, a determination of the plaintiff’s membership interest in the LLC. In opposition to the motion, the plaintiff failed to demonstrate that the relief he is seeking will affect real property in Queens County.

The plaintiff failed to move by notice of cross motion to retain venue in Queens County pursuant to CPLR 510(3), and we decline to review the plaintiff’s informal request in the exercise of discretion.

(Internal quotations and citations omitted).

New York procedural law dictates which county an action can be brought in. The rules are flexible, but as this decision shows, it is possible to run afoul of them and have a lawsuit transferred to a county you did not want to be in. Contact Schlam Stone & Dolan partner John Lundin at jlundin@schlamstone.com if you or a client face a situation where you are unsure where in New York an action may properly be brought.

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