The Law and Technology

    It is always fascinating to watch the law play catch-up with technological change.
   Under New York's Statute of Frauds a contract for the conveyance of real property is not enforceable unless it is in writing. General Obligations Law § 5-703. There is an extensive body of case law on what constitutes a "writing" which satisfies the Statute of Frauds.
    Last week the Appellate Division, First Department, addressed the question of whether an e-mail can constitute a writing which meets the requirements of the General Obligations Law. Justice David Friedman's careful analysis concludes that it can. I recommend the opinion as a good example of how courts seek to fit new technologies into existing law. The ruling, Naldi v. Grunberg, can be found here .  

Two Appellate Wins in One Day

It is always nice to win an appeal, especially when representing the appellant. It is doubly nice to win two in one day.

First, the morning mail brought the news that I had prevailed in the Appellate Term, Second Department, in an unusual case, Sneddon v. Greene. In April, 2008, the trial judge had granted my motion that he recuse himself on the grounds there was an appearance he was not impartial. Four months later, however, the judge sua sponte vacated the order of recusal, put himself back in the case, and ordered a trial be held before him.

The Appellate Term granted my motion for a stay of the trial, and in the appellant's brief I argued that once the judge had recused himself he had no further jurisdiction or authority to participate in the case. The Appellate Term agreed.

There is little New York case law on the jurisdiction of a judge after he has recused himself. The Appellate Term decision in Sneddon v. Greene is in accord with the views of courts in other states which have addressed the question.

The second appellate success today came in the decision of the Appellate Division, First Department, regarding a fee dispute between attorney and client. I had been waiting for a ruling since I argued the case on March 10, 2009.

At the conclusion of a real estate transaction a law firm held in escrow approximately $310,000 which it claimed was the fee owed by the client. The client disputed the fee, and the matter went to arbitration under the Rules of the Chief Administrator of the Courts. See, 22 NYCRR § 137.0 et seq.

The arbitrators awarded the firm $280,000 without interest. But instead of paying itself the $280,000 from the escrow account and remitting the balance to the client, the firm persuaded Supreme Court, New York County, to grant it two years' interest on the fee award. It then entered judgment for the total amount, and with interest running on the judgment, the client was required to pay even more to satisfy the judgment.

I represented the appealing client, and the Appellate Division agreed that it was improper for a court to award the firm interest denied to it by the arbitrators. The Appellate Division also agreed that after the arbitrators' decision the firm should have paid itself the $280,000 from the funds in the escrow account and promptly remitted the balance to the client. Under the ruling the firm is directed to repay to the client, with interest, all sums received from the client above the $280,000 awarded by the arbitrators.

The Appellate Division ruling is also noteworthy because it cites provisions of the Rules of Professional Conduct to support its conclusion that the law firm acted improperly. The opinion offers useful guidance on the responsibility of attorneys involved in fee disputes with clients. The decision, Levin & Glasser v. Kenmore Property, LLC, can be found here.

It would be nice to say that having won two cases I can take the rest of the day off. But alas, there is always something else to do.

First Department: When Is a Child "Emancipated"

Pursuant to Family Court Act § 413(1)(a) a parent has the duty to support his child until the child reaches the the age of 21. This duty, however, will terminate if the child is "emancipated" before he reaches the age of 21. Matter of Roe v. Doe, 29 N.Y.2d 188 (1971).

An Appellate Division, First Department, ruling today, Matter of Thomas B. v. Lydia D., contains a valuable discussion of when a child under the age of 21 is emancipated because he is fully self-supporting and economically independent of his parents. The decision can be found here.

When is a Bar "Overcrowded"?

As the warm weather approaches, New York City's bar scene will flourish. Whether sophisticated or raucous, bars are subject to a host of regulations from the Fire Department, the Department of Buildings, and the State Liquor Authority (SLA), not to mention Penal Law provisions regarding disorderly conduct.

The Appellate Division, First Department, divided today 3-2 on what constitutes substantial evidence that a bar is overcrowded in violation of SLA rules. Mtr. of 47 Ave. B. v. New York State Liq. Auth. In the view of the majority, testimony that patrons were standing "shoulder to shoulder" is an inadequate basis to find overcrowding and to revoke a bar's liquor license.

The bar's certificate of occupancy permitted 61 people in the cellar, and 135 on the first floor. The majority noted that the SLA investigator did not use a counting device, nor did he take an actual headcount of the people in the bar, so there is no way to determine whether the number of patrons exceeded the number permitted by the certificate of occupancy.  A "guesstimate," said the majority, is not substantial evidence.

In the dissent's view the investigator's estimate that there were 75 to 100 patrons in the bar's cellar, and patrons standing throughout the bar "shoulder to shoulder," together with a police officer summons that there were 300 patrons in the bar, is sufficient evidence to establish the claim of overcrowding. The majority noted, however, that the summons was unsworn and was dismissed in court, so all that is left is evidence that patrons were "shoulder to shoulder."

The "substantial evidence" test for reviewing administrative agency determinations calls for a minimum of judicial oversight of agency rulings which seriously affect livelihoods and licenses. Rejecting the "shoulder to shoulder" evidence is sound. As the majority observed, "It does not warrant further conjecture as to the consequences of finding every bar/restaurant in Manhattan to be in violation of the SLA Law based solely upon evidence that patrons were standing 'shoulder to shoulder.'" 

I'll drink to that.