40000/88 -190215/11 -190262/11, 15678, 190293/11, 190294/11, 190299/11, 190311/11, 15677, 15676, 15675

130 A.D.3d 489 (2015)

13 N.Y.S.3d 398

2015 NY Slip Op 06027


Appellate Division of the Supreme Court of New York, First Department.

Decided July 9, 2015.

In this New York City Asbestos Litigation (NYCAL), the Case Management Order (CMO) was amended in 1996 by the Coordinating Justice to add section XVII which provides that "[c]ounts for punitive damages are deferred until such time as the Court deems otherwise, upon notice and hearing" (emphasis added). In April 2013, all plaintiffs jointly moved to modify section XVII to read: "Plaintiffs are permitted to seek punitive damages against defendants upon application to the assigned Trial Court." The NYCAL defendants jointly opposed the motion and moved to vacate and declare inapplicable the CMO, asserting, inter alia, that the CMO could not be amended without their consent. In July 2013, six NYCAL plaintiffs moved for permission to allege punitive damages claims and proffer related evidence against the defendants in their cases. The defendants in those six cases, and amici curiae, including the NYCAL defendants, opposed the motion.

The motion court had the authority to modify the CMO. New York's Uniform Rules for Trial Courts (22 NYCRR) § 202.69 allows the Coordinating Justice to "issue case management orders after consultation with counsel." The court reached its determination after consulting with counsel, and hearing and considering defense counsel's objections.

The April order did not constitute an improper "advisory opinion." The order modified the CMO, something which the court was empowered to do. Unlike in Cuomo v Long Is. Light. Co. (71 N.Y.2d 349 [1988]), the parties to the NYCAL are involved in an actual dispute in New York courts, and the April order did not give advice, it set parameters for that litigation.

However, we find that the court exceeded its authority to the extent that the April order directs that applications for permission to charge the jury on the issue of punitive damages "shall be made at the conclusion of the evidentiary phase of the trial upon notice to the affected defendant(s), to which such defendant(s) shall have an opportunity to respond" (Matter of New York City Asbestos Litig., 2014 NY Slip Op 33525[U], *20 [Sup Ct, NY County 2014]). Due process requires that a defendant be provided with an "opportunity to conduct discovery and establish a defense with respect to this ... damage[s] claim" since such claims involve "different elements and standards of proof and potentially subject defendants to a far greater and different dimension of liability than would otherwise [be] the case" (Heller v Louis Provenzano, Inc., 303 A.D.2d 20, 23 [1st Dept 2003]). The April order deprives defendants of their rights to due process by leaving them guessing, until the close of evidence at trial, whether or not punitive damages will be sought. Even plaintiffs, in their proposed modification of section XVII, recognized the need for pretrial resolution of the punitive damages issue. We therefore modify to delete the second sentence of the first decretal paragraph of the April order and remand the matter to the Coordinating Justice for a determination of procedural protocols by which plaintiffs may apply for permission to charge the jury on the issue of punitive damages. We note, however, that this decision does not preclude the Coordinating Justice, after consultation with the parties, from reconsidering other aspects of the April order, including the determination whether to permit claims for punitive damages under the CMO, in the exercise of the court's discretion, either upon application or at its own instance.

In a subsequent order, entered December 18, 2014, the motion court denied defendants' motion for a stay and found, inter alia, "there is nothing . . . that prohibits discovery requests tailored to punitive damages issues . . . Nor does the Order or the CMO contain any prohibition against a defendant's moving to dismiss counts for punitive damages." These explanations do not resolve the issue arising from the April order. Defendants cannot seek discovery in connection with, and the court cannot dismiss, a claim which a plaintiff has not yet actively asserted.

Finally, no appeal lies from the denial of reargument (see D'Andrea v Hutchins, 69 A.D.3d 541 [1st Dept 2010]), and defendants have abandoned their appeal from the portion of the order denying renewal (see Mehmet v Add2Net, Inc., 66 A.D.3d 437, 438 [1st Dept 2009]).


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