Court of Appeals Arguments of Interest for the Week of November 17, 2014

Arguments the week of November 17, 2014, in the Court of Appeals that may be of interest to commercial litigators.

  • No. 223: Rigano v. Vibar Construction, Inc. (Proceeding No. 1) and Vibar Construction Corp. v. Fawn Builders, Inc. (Proceeding No. 2) (To be argued Tuesday, November 18, 2014) (considering whether misidentification of the true owner on a mechanics lien is a jurisdictional defect which cannot be cured by an amendment). The Second Department decision is available here.
  • No. 228: 172 Van Duzer Realty Corp. v. Globe Alumni Student Assistance Association, Inc. (To be argued Wednesday, November 19, 2014) (considering whether a lease’s acceleration clause constituted an unenforceable penalty). The First Department decision is available here.

CLE Program: Commercial Division Practice: What You Need to Know

On December 5, 2014, Schlam Stone & Dolan partners Jeffrey Eilender and John Lundin will co-chair the New York State Bar Association CLE program: Commercial Division Practice: What You Need to Know. Among the panelists will be Justice Bransten of the New York County Commercial Division.

Transcripts and Videos of Arguments in the Court of Appeals for the Week of October 20, 2014, Now Available

On October 20, 2014, we noted three cases of interest from the oral arguments for the week of October 20, 2014:

  • No. 197Kimso Apartments, LLC v. Gandhi (considering whether Supreme Court improvidently exercised its discretion in permitting the defendant to “conform the pleadings to the proof” by amending his answer to assert an “intrinsic,” but formally unasserted, counterclaim). See the transcript and the video.
  • No. 216: Sierra v. 4401 Sunset Park, LLC (considering whether insurance company complied with disclaimer requirements of Section 3420(d)(2) of the Insurance Law by providing notice of disclaimer of insurance to insured’s primary insurer, but not directly to the insured). See the transcript and the video.
  • No. 203: Strauss Painting, Inc. v. Mt. Hawley Insurance Company (considering whether an insured satisfied the policy’s notice requirement by notifying its broker of the claim with the expectation that the broker would notify the carrier). See the transcript and the video.

Court of Appeals Arguments of Interest for the Week of October 20, 2014

Arguments the week of October 20, 2014, in the Court of Appeals that may be of interest to commercial litigators.

  • No. 197Kimso Apartments, LLC v. Gandhi (To be argued Tuesday, October 21, 2014) (considering whether Supreme Court improvidently exercised its discretion in permitting the defendant to “conform the pleadings to the proof” by amending his answer to assert an “intrinsic,” but formally unasserted, counterclaim). The Second Department decision is available here.
  • No. 216: Sierra v. 4401 Sunset Park, LLC (To be argued Wednesday, October 22, 2014) (considering whether insurance company complied with disclaimer requirements of Section 3420(d)(2) of the Insurance Law by providing notice of disclaimer of insurance to insured’s primary insurer, but not directly to the insured). The Second Department decision is available here.
  • No. 203: Strauss Painting, Inc. v. Mt. Hawley Insurance Company (To be argued Wednesday, October 22, 2014) (considering whether an insured satisfied the policy’s notice requirement by notifying its broker of the claim with the expectation that the broker would notify the carrier). The First Department decision is available here.

Transcripts and Videos of Arguments in the Court of Appeals for the Week of September 15, 2014, Now Available

On September 8, 2014, we noted two cases of interest from the oral arguments for the week of September 15, 2014:

  • No. 162Motorola Credit Corporation v. Standard Chartered Bank (considering certified questions from the Second Circuit on the application of the “separate entity rule” to post-judgment enforcement proceedings under CPLR Article 52). See the transcript and the video.
  • No. 165Grace v. Law (regarding whether a party who voluntarily discontinues an underlying action and forgoes an appeal thereby abandons his or her right to pursue a claim for legal malpractice). See the transcript and the video.

Transcripts and Videos of Arguments in the Court of Appeals for the Week of September 8, 2014, Now Available

On September 8, 2014, we noted a case of interest from the oral arguments for the week of September 8, 2014:

  • No. 156Ellington v. EMI Music Inc. (regarding the interpretation of the provisions of a royalty agreement between the family of Duke Ellington and music publishers concerning the allocation of revenues from foreign publication of Ellington’s music). See the transcript and the video.

Court of Appeals Arguments of Interest for the Weeks of September 8, 2014 and September 15, 2014

Arguments the weeks of September 8, 2014 and September 15, 2014, in the Court of Appeals that may be of interest to commercial litigators.

  • No. 156Ellington v. EMI Music Inc. (To be argued Thursday, September 11, 2014) (regarding the interpretation of the provisions of a royalty agreement between the family of Duke Ellington and music publishers concerning the allocation of revenues from foreign publication of Ellington’s music). See First Department decision here.
  • No. 162: Motorola Credit Corporation v. Standard Chartered Bank (To be argued Tuesday, September 16, 2014) (considering certified questions from the Second Circuit on the application of the “separate entity rule” to post-judgment enforcement proceedings under CPLR Article 52). See Second Circuit decision here. See our previous posts about the Second Circuit decision and the Court of Appeals decision accepting the certified questions here and here.
  • No. 165: Grace v. Law (To be argued Wednesday, September 17, 2014) (regarding whether a party who voluntarily discontinues an underlying action and forgoes an appeal thereby abandons his or her right to pursue a claim for legal malpractice). See Fourth Department decision here.

Court of Appeals Accepts Certified Questions Regarding Interpretation of Oil and Gas Leases

On August 28, 2014, the Court of Appeals accepted two certified questions from the Second Circuit in Beardslee v. Inflection Energy, LLC, 12-4897-CV, a case involving the interpretation of oil and gas leases. At issue in Beardslee is the interplay between two provisions in the leases: (1) the so-called “habendum” clause, which sets the duration of the lease, and (2) a force majeure clause, which concerns delays or interruptions in drilling. The habendum clauses at issue provided for a five year initial term, and an option for a secondary term, which would extend “as long thereafter” as the land “is operated by the Lessee in the production of oil or gas.” The force majeure clauses stated: “If and when drilling . . . [is] delayed or interrupted . . . as a result of some order, rule regulation . . . or necessity of the government, or as the result of any other cause whatsoever beyond the control of the Lessee, the time of such delay or interruption shall not be counted against the Lessee, anything in this lease to the contrary notwithstanding.”

After the expiration of the five-year term, the lessee had still not commenced drilling because the only “commercially viable” method of drilling in the property—high-volume hydraulic fracturing, or “fracking”—was subject to a regulatory moratorium in New York (although permits for other unprofitable methods were in theory available). The lessees took the position that the regulations amounted to a force majeure event under the leases, and that the force majeure clause extended the term in the habendum clause. The landowners brought a declaratory judgment action in the Northern District of New York, alleging that the leases expired by their terms after five years because the lessees had not begun drilling. The district judge granted summary judgment to the landowners, declaring the leases expired.

Finding that the case raised novel and important questions of New York law that had not been addressed by the Court of Appeals, or any lower courts, the Second Circuit certified two questions to the Court of Appeals:

1. Under New York Law, and in the context of an oil and gas lease, did the State’s Moratorium amount to a force majeure even?

2. If so, does the force majeure clause modify the habendum clause and extend the primary terms of the leases?

As the Second Circuit noted, the outcome of this case could have “potentially great commercial and environmental significance to State residents and businesses.” We will continue to follow this case as it makes its way through the Court of Appeals.

Transcripts and Videos of Arguments in the Court of Appeals for the Week of June 2, 2014, Now Available

On May 29, 2014, we noted two cases of interest from the oral arguments for the week of June 2, 2014:

  • Docket No. 129: People v. John F. Haggerty, Jr. (a criminal case addressing an evidentiary issue also relevant to commercial litigators—the best evidence rule: specifically, whether the testimony of the attorney who drafted a trust is admissible to prove the ownership of the trust assets when the trust agreement was available)). See the transcript and the video.
  • Docket No. 136: In re: Thelen LLP (Geron v Seyfarth Shaw LLP) and No. 137: In re: Coudert Brothers, LLP (Development Specialists, Inc. v K&L Gates LLP) (addressing certified questions from the Second Circuit: “Under New York law, is a client matter that is billed on an hourly basis the property of a law firm, such that, upon dissolution and in related bankruptcy proceedings, the law firm is entitled to the profit earned on such matters as the “unfinished business” of the firm?” and “If so, how does New York law define a ‘client matter’ for purposes of the unfinished business doctrine and what proportion of the profit derived from an ongoing hourly matter may the new law firm retain?). See the transcript and the video.