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A07600 Summary:

Amd 3215, CPLR
Relates to the permitted submissions in a default judgment, permitting the party entitled to judgment to submit additional proof of damages.
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A07600 Actions:

05/13/2019referred to judiciary
05/21/2019reported referred to codes
05/30/2019advanced to third reading cal.560
06/05/2019passed assembly
06/05/2019delivered to senate
06/19/2019SUBSTITUTED FOR S6471
06/19/20193RD READING CAL.1725
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A07600 Memo:

submitted in accordance with Assembly Rule III, Sec 1(f)
SPONSOR: Abinanti
  TITLE OF BILL: An act to amend the civil practice law and rules, in relation to the permitted submissions in a default judgment This is one of a series of measures being introduced at the request of the Chief Administrative Judge upon the recommendation of his Advisory Committee on Civil Practice. This measure would amend CPLR 3215(b) to outline the procedure for an inquest on a default judgment. A defendant who defaults in appearing concedes only liability. See Roki- na Opt. Co. v. Camera Kings, 63 N.Y.2d 728, 730 (1984) ("a defendant whose answer is stricken as a result of a default admits all traversable allegations in the complaint, including the basic allegation of liabil- ity, but does not admit the plaintiffs conclusion as to damages"); Glen- wood Mason Supply Co., Inc. v. Frantellizzi, 138 A.D.3d 925 (2d Dep't 2016). Therefore, the defaulting defendant may still contest damages at an inquest. The CPLR does not contain a detailed procedure for conduct- ing an inquest, but there are provisions in the Uniform Rules for the Supreme and County Courts ("Uniform Rules") addressing the issue. These provisions permit the plaintiff to put in paper proof of damages at the inquest and do not require live testimony. Section 202.46 of the Uniform Rules (22 NYCRR 202.46), entitled: "Damages, inquest after default; proof', provides: (a) In an inquest to ascertain damages upon a default, pursuant to CPLR 3215, if the defaulting party fails to appear in person or by represen- tative, the party entitled to judgment, whether a plaintiff, third-party plaintiff, or a party who has plead a cross-claim or counterclaim, may be permitted to submit, in addition to the proof required by CPLR 3215(e) (sic; should be CPLR 3215(0), properly executed affidavits as proof of damages. (emphasis added) (b) In any action where it is necessary to take an inquest before the court, the party seeking damages may submit the proof required by oral testimony of witnesses in open court or by written statements of the witnesses, in narrative or question-andanswer form, signed and sworn to. (emphasis added) See Archer v. Motor Veh. Accident Idem. Corp., 2012 NY Slip OP 33568(U), 2012 WL 10816412 (Sup. Ct., Queens County 2012)(setting down matter for inquest but noting "(i)n lieu thereof, plaintiff may submit properly executed affidavits as proof of damages (22 NYCRR 202.46)"), aff'd on other grounds 188 A.D3d 5 (2d Dep't 2014); see also Siegel, New York Practice § 295 ("Papers on Default Application")("Even at an inquest on damages conducted after the defendant has conceded liability by failing to appear, the plaintiff may put in paper proof of damages; live testi- mony is not indispensable."). There are similar Uniform Rules in other courts. See 22 NYCRR 208.32 ("Damages, inquest after default; proof') (Uniform Civil Rule for the New York City Civil Court permitting submission of proof at inquest by affidavits); see also 22 NYCRR 202.70(g), Commercial Division Rule 32(a)("Direct Testimony by Affidavit")(allowing testimony by affidavit at a contested non-jury trial or evidentiary hearing, not just an inquest upon a default). Despite the existence of these procedures in the Uniform Rules governing default judgment applications, we understand that courts and lawyers may not be aware of their existence. Furthermore, the procedure allowed by the plain language of these rules may not sufficiently respect the due process right of a defaulting party to fully cross-examine witnesses testifying as to damages. In Rokina Opt. Co. v Camera King, supra, the Court of Appeals held that "judgment against a defaulting party may be entered only upon applica- tion to the court along with notice to the defaulting party and 'a full opportunity to cross-examine witnesses, give testimony and offer proof in mitigation of damages'." Quoting from Rokina in Conteh v. Hand, 234 AD2d 96 (1st Dep't 1996), the First Department ruled that Supreme Court improperly refused to permit the defendants to call a witness at an inquest on damages after the completion of plaintiff s testimony. The court remanded the matter for a new inquest on damages. In Ruzal v. Mohammad, 283 A.D.2d 318, 319, (1st Dep't 2001), the First Department ruled that Supreme Court "erred in holding an inquest on submissions only without defendant having first defaulted on a formal inquest proceeding (22 NYCRR § 202.46(a))." Quoting again from Rokina and citing to Conteh, the First Department ordered "the matter restored to the trial calendar for a proper inquest on damages." There also is case law interpreting the Uniform Rules, which holds that the plaintiff can only proceed on documentary proof if a defaulting defendant does not contest damages at the inquest. In Suleiman v. Miamor Transp. Corp., 13 Misc.3d 1230(A), 2006 WL 3068963 (Sup.Ct., Bronx Coun- ty 2006), for example, the trial court refused to allow plaintiffs to submit affidavits from their doctors as proof of damages in lieu of their testimony. Interpreting Uniform Rule 202.46, the court concluded that the rule does not permit the plaintiff to submit proof of damages at an inquest in documentary form if the defendant appears at the inquest. Similarly, in Rivera v. Serrata, 19 Misc. 3d 379 (Sup. Ct., Bronx County 2008), where the inquest was conducted before a jury, the court held that the presentation of written statements pursuant to Uniform Rule 202.46 in lieu of live testimony "would not sufficiently assist the jurors in determining whether plaintiff suffered a 'serious injury' and in their assessment of the amount of damages." The court read the phrase 'before the court' in the rule, 22 NYCRR 202.46(b), as providing that plaintiff may present such documentary evidence only in a non jury proceeding, since the court, as finder of fact, would be in a position to properly evaluate and weigh such evidence, along with that, if any, presented by the defendant." The court's decision in Suleiman relies on language in Rokina, Conteh and Ruzal to reach the conclusion that a plaintiff is not permitted to submit proof of damages on papers alone if the defendant appears at the inquest. We believe that this interpretation of the relevant Uniform Rules is unnecessarily restrictive, as a party applying for a default judgment before the court should be permitted to submit proof in affida- vit form. See Rawlings v. Gillert, 104 A.D.3d 929 (2d Dep't 2013)(while noting that "the defendant is entitled to a 'full opportunity to cross- examine witnesses, give testimony and offer proof in mitigation of damages,' the court also ruled that "plaintiff should have been permit- ted to submit evidence, including affidavits (see 22 NYCRR 202.46), supporting her claims for (damages)"). The defaulting party must, howev- er, be afforded the opportunity to fully cross-examine any damages witnesses, regardless of whether they have provided oral testimony or have submitted proof in affidavit form. Given the conflicting case law in this area, we request enactment of the instant measure to ensure clarity and due process in default judgment actions. This measure, which would have no fiscal impact, would take effect imme- diately.   2017-18 LEGISLATIVE HISTORY: A10363 (Abinanti) (2018-referred to codes)
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A07600 Text:

                STATE OF NEW YORK
                               2019-2020 Regular Sessions
                   IN ASSEMBLY
                                      May 13, 2019
        Introduced  by  M. of A. ABINANTI, DINOWITZ -- (at request of the Office
          of Court Administration) -- read once and referred to the Committee on
        AN ACT to amend the civil practice law and rules,  in  relation  to  the
          permitted submissions in a default judgment

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. Subdivision (b) of section 3215 of the civil  practice  law
     2  and  rules, as amended by chapter 749 of the laws of 1965, is amended to
     3  read as follows:
     4    (b) Procedure before court. The court, with or  without  a  jury,  may
     5  make  an  assessment or take an account or proof, or may direct a refer-
     6  ence. The party entitled to judgment may  be  permitted  to  submit,  in
     7  addition to the proof required by subdivision (f) of this section, prop-
     8  erly  executed  affidavits or affirmations as proof of damages, provided
     9  that if the defaulting party gives reasonable notice that it will appear
    10  at the inquest, the party seeking damages may submit any such  proof  by
    11  oral  testimony  of the witnesses in open court or, after giving reason-
    12  able notice that it will do so,  by  written  sworn  statements  of  the
    13  witnesses,  but shall make all such witnesses available for cross-exami-
    14  nation. When a reference is directed, the  court  may  direct  that  the
    15  report  be  returned to it for further action or, except where otherwise
    16  prescribed by law, that judgment be entered by the clerk  in  accordance
    17  with the report without any further application. Except in a matrimonial
    18  action, no finding of fact in writing shall be necessary to the entry of
    19  a judgment on default. The judgment shall not exceed in amount or differ
    20  in  type  from  that  demanded  in the complaint or stated in the notice
    21  served pursuant to subdivision (b) of rule 305 of this chapter.
    22    § 2. This act shall take effect immediately.
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
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