Perez v. Paramount Communications, Inc.

• Decision Date: 18 February 1999
• Citation: 686 N.Y.S.2d 342,709 N.E.2d 83,92 N.Y.2d 749
• Parties: , 709 N.E.2d 83, 1999 N.Y. Slip Op. 1452 Carlos PEREZ, Respondent, v. PARAMOUNT COMMUNICATIONS, INC., et al., Defendants, and Madison Square Garden, L.P., as Successor to Madison Square Garden Center, Inc., Appellant.
• Court: New York Court of Appeals Court of Appeals

Page 342

686 N.Y.S.2d 342

92 N.Y.2d 749, 709 N.E.2d 83, 1999

N.Y. Slip Op. 1452

Carlos PEREZ, Respondent, v. PARAMOUNT COMMUNICATIONS, INC., et al., Defendants, and Madison Square Garden, L.P., as Successor to Madison Square

Garden Center, Inc., Appellant.

Court of Appeals of New York.

Feb. 18, 1999.

Herzfeld & Rubin, P.C., New York City (Harold M. Weidenfeld, Herbert Rubin, David B. Hamm and Linda M. Brown of counsel), for appellant.

Profeta & Eisenstein, New York City (Fred R. Profeta, Jr. of counsel), and Isaacson, Schiowitz, Korson & Solny for respondent.

OPINION OF THE COURT

SMITH, J.

The issue raised on this appeal is whether the filing of a motion for leave to amend the complaint to add a defendant to a pending action can, for Statute of Limitations purposes, be considered the timely commencement of the action as against the party sought to be added when the motion papers include a copy of the proposed supplemental summons and amended complaint.

Plaintiff Carlos Perez alleges that he was injured on November 20, 1990, when he fell from a scaffold while working to renovate Manhattan's Madison Square Garden. ¹ On November 27, 1992, plaintiff filed this negligence action in Bronx Supreme Court against defendant Paramount Communications, Inc. In his complaint, plaintiff alleged that Paramount was liable for his injuries based upon its ownership and operation of Madison Square Garden, Later, during discovery, plaintiff learned that in fact Paramount was not the owner or operator of Madison Square Garden and that an entity known as Madison Square Garden, L.P. (MSG) was. Discovery also revealed that two general contractors, Herbert Construction Corporation and H.R.H. Construction Corporation (Herbert/HRH), were involved in the project.

On June 16, 1993, plaintiff moved by notice of motion for leave to amend his complaint to add MSG as a defendant. Annexed to his motion papers was a copy of the proposed supplemental summons and amended complaint, copies of which plaintiff mailed to Paramount and filed with the court. Supreme Court granted plaintiff's motion to amend to add MSG as a defendant by a settled order dated October 28, 1993, and entered on November 3, 1993. On November 1, 1993, plaintiff served the supplemental summons and amended complaint on Paramount and MSG. On December 2, 1993, plaintiff filed the supplemental summons and amended complaint with the court accompanied by proof of service.

On November 29, 1993, plaintiff instituted a separate action against the general contractors, and thereafter successfully moved to consolidate the separate actions. All defendants then moved to dismiss--Paramount, on the ground that it did not own or operate Madison Square Garden and thus could not be held liable for plaintiff's injuries; and MSG and Herbert/HRH on the grounds that the action was barred by the Statute of Limitations.

Supreme Court agreed with Paramount and dismissed the action against it, and also granted summary judgment to Herbert/HRH on Statute of Limitations grounds. Using an accident date of November 20, 1990, the court concluded that the filing of plaintiff's action against Herbert/HRH on November 29, 1993 was barred by the applicable three-year Statute of Limitations (CPLR 214[5] ). Although Supreme Court found that plaintiff's action against MSG was also untimely, the court held that MSG and Paramount were "united in interest" such that the action against MSG was timely as a result of the filing of plaintiff's original claim against Paramount.

The Appellate Division unanimously affirmed, albeit for different reasons. The Appellate Division disagreed with Supreme Court that MSG and Paramount were "united in interest" since different defenses were available to each. Nevertheless, the Court concluded that the action against MSG was timely because plaintiff filed his motion to amend the complaint to add MSG as a defendant, with a copy of the proposed supplemental summons and amended complaint, prior to expiration of the Statute of Limitations. Thereafter, the Appellate Division granted leave to MSG to appeal to this Court and certified the question of whether its order was properly made. We answer that certified question in the affirmative and accordingly affirm.

Nearly 50 years ago, we held in Arnold v. Mayal Realty Co., 299 N.Y. 57, 85 N.E.2d 616, that prior to receiving judicial permission, service of a notice of motion for leave to amend to add a defendant to an action, which included the proposed supplemental summons and amended complaint, could not be considered commencement of the action against the party sought to be added. Under Arnold, unless and until judicial permission to add a defendant was obtained, service of the motion papers alone did not stop the running of the Statute of Limitations.

Plaintiff in this case challenges the reach of Arnold in light of the policies of the CPLR, and this State's recent transition to a commencement-by-filing system (see, CPLR 304, as amended by L.1992, ch. 216, § 4). Plaintiff argues that the filing of a motion for leave to amend to add a defendant to the action along with a copy of the proposed supplemental summons and amended complaint should be considered the interposition of the claim against the prospective party. Accordingly, under plaintiff's view, the filing of such a motion is itself sufficient to stop the running of the Statute of Limitations. Pursuant to that interpretation, the claim against MSG was interposed as of June 16, 1993. Plaintiff alternatively urges a rule which would allow for the tolling of the Statute of Limitations during the pendency of the motion, until the court renders its decision. MSG, on the other hand, urges us to extend Arnold to the commencement-by-filing system and dismiss the instant action.

The joinder of an additional defendant by the filing of a supplemental summons and amended complaint may be accomplished only with prior judicial permission, and noncompliance renders the pleadings jurisdictionally defective (see, CPLR 1003; Crook v. E.I. du Pont de Nemours & Co., 81 N.Y.2d 807, 595 N.Y.S.2d 388, 611 N.E.2d 289, affg. 181 A.D.2d 1039, 582 N.Y.S.2d 581; Ospina v. Vimm Corp., 203 A.D.2d 440, 610 N.Y.S.2d 574; Dauernheim v. Lendlease Cars, 202 A.D.2d 624, 609 N.Y.S.2d 302). CPLR 1003, as it existed at the time of this action, required leave of court to add a party defendant. ² Therefore, unless a separate action is filed, a plaintiff seeking to add a defendant in most cases must first apply for, and then await, judicial permission. Where the motion, including the proposed supplemental summons and amended complaint, is filed with the court within the applicable limitations period, but the ruling by the court does not occur until after expiration, dismissal is inappropriate and would offend the CPLR's liberal policies of promoting judicial economy and preventing a multiplicity of suits (see, Blanco v. American Tel. & Tel. Co., 90 N.Y.2d 757, 773, 666 N.Y.S.2d 536 689 N.E.2d 506; City of New York v. Long Is. Airports Limousine Serv. Corp., 48 N.Y.2d 469, 475, 423 N.Y.S.2d 651, 399 N.E.2d 538; CPLR 104).

We reject MSG's position that the rationale of Arnold should be continued in commencement-by-filing circumstances. While we recognize that commencement-by-service is still operational in some State courts and that the rationale of Arnold will still be operative, ³ a different rule is needed for the commencement-by-filing system. Statutes of Limitation are designed to promote justice by preventing prejudice through the revival of stale claims (Blanco v. American Tel. & Tel. Co., 90 N.Y.2d, supra, at 773, 666 N.Y.S.2d 536, 689 N.E.2d 506). That goal would not be served by a rule which would render the timeliness of a claim dependent upon the speed with which a court decides a motion (see, Vastola v. Maer, 48 A.D.2d 561, 564, 370 N.Y.S.2d 955, affd. 39 N.Y.2d 1019, 387 N.Y.S.2d 246, 355 N.E.2d 300). We similarly decline to adopt plaintiff's position that the filing of the motion alone should be considered the formal interposition of the claim within the meaning of CPLR 203(a). As indicated herein, the tolling option is more appropriate in New York.

Adoption of a toll under these...