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PLUDEMAN v. NORTHERN LEASING SYSTEMS, INC.
74 A.D.3d 420 (2010)
904 N.Y.S.2d 372
KEVIN PLUDEMAN et al., Appellants-Respondents,
v.
NORTHERN LEASING SYSTEMS, INC., et al., Respondents-Appellants.
2065A & 2065, 101059/04.
Appellate Division of the Supreme Court of New York, First Department.
Decided June 1, 2010.
Concur—MAZZARELLI, J.P., SWEENY, MOSKOWITZ, MANZANET-DANIELS and ROMÁN, JJ.
Plaintiffs are small business owners who leased credit card point of sale (POS) equipment from Northern Leasing, which is in the business of leasing such equipment. The POS equipment was purportedly leased pursuant to a four page lease. Plaintiffs contend that the first page of the lease represents the entire agreement and that this page failed to disclose, inter alia, that plaintiffs were subject to a loss damage waiver (LDW) fee. Plaintiffs contend that Northern Leasing breached the equipment lease by charging and collecting LDW payments that were not disclosed on the first page of the lease. Plaintiff's claims sound in breach of contract and fraud. The motion court granted plaintiffs' application for class certification with respect to the breach of contract claim, finding that plaintiffs had satisfied the requisites of CPLR 901 and 902. The motion court also granted plaintiffs' application seeking that Northern Leasing bear the cost associated with providing court approved notices to all members of the class. Plaintiffs appeal the portion of the motion court's order that limited the class definition to any lessees who entered into leases with Northern Leasing prior to commencement of this action and to any lessees who made LDW payments. Plaintiffs also appeal the motion court's failure to include in the class definition any lessees whose leases were assigned to Northern Leasing. Lastly, plaintiffs appeal the motion court's exclusion from the class definition of those lessees whose leases made reference to LDW on the first page. Northern Leasing appeals the motion court's decision to certify the class, alleging error in the court's conclusion that common issues predominate over those pertaining to individual class members and that the named plaintiffs are typical of the class, as well as its decision that Northen Leasing should bear the expense of providing court approved notices to all class members. CPLR 902 states that a class action can only be maintained if the prerequisites promulgated by CPLR 901 (a) are met (Weinberg v Hertz Corp., 116 A.D.2d 1, 4 [1986], affd 69 N.Y.2d 979 [1987]). Those prerequisites are (1) that the class is so numerous that joinder of all members is impracticable (numerosity); (2) questions of law or fact common to the class predominate over questions of law or fact affecting individual class members (commonality); (3) the claims or defenses of the class representatives
are typical of those in the class (typicality); (4) the class representatives will fairly and adequately protect the interests of the class; and (5) a class action represents the superior method of adjudicating the controversy (superiority) (id.; CPLR 901 [a]). If the prerequisites set out in CPLR 901 (a) are met, the court, in deciding whether to grant class action certification should then consider the additional factors promulgated by CPLR 902 such as the interest of individual class members in maintaining separate actions and the feasability thereof; the existence of pending litigation regarding the same controversy; the desirability of the proposed class forum; and the difficulties likely to be encountered in managing the class action (CPLR 902; Ackerman v Price Waterhouse, 252 A.D.2d 179, 191 [1998]). Whether the facts presented on a motion for class certification satisfy the statutory criteria is within the sound discretion of the trial court (Small v Lorillard Tobacco Co., 94 N.Y.2d 43, 52 [1999]; CLC/CFI Liquidating Trust v Bloomingdale's, Inc., 50 A.D.3d 446, 447 [2008]; Wilder v May Dept. Stores Co., 23 A.D.3d 646, 649 [2005]; Klein v Robert's Am. Gourmet Food, Inc., 28 A.D.3d 63, 70 [2006]; Ackerman at 191; Lauer v New York Tel. Co., 231 A.D.2d 126, 130 [1997]). However, this Court is also vested with the same discretion and may exercise it even if there has been no abuse by the trial court (Small at 52-53; CLC/CFI Liquidating Trust at 447; Klein at 70). The proponent of class certification bears the burden of establishing the criteria promulgated by CPLR 901 (a) (CLC/CFI Liquidating Trust at 447; Ackerman at 191), and must do so by the tender of evidence in admissible form (Feder v Staten Is. Hosp., 304 A.D.2d 470, 471 [2003]). Conclusory assertions are insufficient to satisfy the statutory criteria (id.; Chimenti v American Express Co., 97 A.D.2d 351, 352 [1983]). In determining whether an action should proceed as a class action, it is appropriate to consider whether the claims have merit (Bloom v Cunard Line, 76 A.D.2d 237, 240 [1980]). However this "inquiry is limited" (id.) and such threshold determination is not intended to be a substitute for summary judgment or trial (Kudinov v Kel-Tech Constr. Inc., 65 A.D.3d 481, 482 [2009]). Class action certification is thus appropriate if on the surface there appears to be a cause of action which is not a sham (Brandon v Chefetz, 106 A.D.2d 162, 168 [1985]). CPLR 901 (a) (2) requires that questions of law or fact common to the class predominate over any such questions affecting individual class members. Thus, when individualized proof is required for the claims alleged or individual factual questions
with respect to individual class members preponderate, commonality is lacking (CLC/CFI Liquidating Trust at 447; DeFilippo v Mutual Life Ins. Co. of N.Y., 13 A.D.3d 178, 180-181 [2004], lv dismissed 5 N.Y.3d 746 [2005]; Banks v Carroll & Graf Publs., 267 A.D.2d 68, 69 [1999]). However, the rule requires predominance not identity or unanimity among class members (Friar v Vanguard Holding Corp., 78 A.D.2d 83, 98 [1980]). Thus, commonality is not merely an inquiry into whether common issues outnumber individual issues but rather "whether the use of a class action would achieve economies of time, effort, and expense, and promote uniformity of decision as to persons similarly situated" (id. at 97 [internal quotation marks and citations omitted]). Class certification is appropriate even when there are questions of law or fact not common to the class (id.; Weinberg at 6; Kudinov at 482; Freeman v Great Lakes Energy Partners, L.L.C., 12 A.D.3d 1170, 1171 [2004]).
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