Carnegie Associates Ltd. v. Miller

Andrias, J.P,

dissents in a memorandum as follows: Because I believe that Supreme Court had the authority to sanction plaintiff for its failure to mediate as ordered, and that the striking of the complaint and the reply to counterclaims was a provident exercise of discretion, I respectfully dissent and would affirm the orders on appeal.

In January 2010, Supreme Court declined to strike plaintiffs pleadings but sanctioned it for “unnecessary and perhaps egregious [discovery] delay[s].” By so-ordered stipulation dated March 18, 2010, the parties agreed to “mediation through the Commercial Division ADR [Alternative Dispute Resolution] process.”

The mediation was scheduled for April 20, 2010, but was postponed when plaintiff’s counsel, Jonathan Abraham, confirmed that Sherwood Schwarz, a necessary decision maker for plaintiff, would not attend. The mediation was rescheduled for July 26, 2010, but was cancelled because Mr. Abraham failed to file a mediation statement on plaintiffs behalf. Consequently, the mediator asked that the matter be reassigned because he had “formed a bias against plaintiffs lawyer” due to the latter’s failure to communicate and his “extraordinarily cavalier attitude . . . toward the mediation process, the Court, and [the mediator].”

Pursuant to CPLR 3126 and 22 NYCRR 202.26 (e), defendants moved to strike the complaint and the reply to counterclaims based on plaintiffs failure to mediate. Supreme Court *445granted the motion, finding that plaintiff, despite narrowly escaping dismissal for discovery violations, had continued to proceed in this litigation in a manner that could only lead to a conclusion that its conduct was willful and contemptuous.

“If the credibility of court orders and the integrity of our judicial system are to be maintained, a litigant cannot ignore court orders with impunity” (Brill v City of New York, 2 NY3d 648, 6523 [2004], quoting Kihl v Pfeffer, 94 NY2d 118, 123 [1999]). While neither CPLR 3126 nor 22 NYCRR 202.06 (e) expressly gives the court the authority to strike a party’s pleadings based on the failure to mediate, plaintiff did not raise that objection in its opposition to defendants’ motion or in its motion to renew, and the issue is not preserved. Should we consider the issue, which raises a pure question of law, for the first time on appeal, it is appropriate that we determine whether there is any statute or rule that empowers the court to strike plaintiffs pleadings based on its failure to mediate as ordered.

Rule 3 of the Rules of the Commercial Division (see 22 NYCRR 202.70 [g]), provides that “[a]t any stage of the matter, the court may direct . . . the appointment of an uncompensated mediator.” Rule 12 thereof provides that “[t]he failure of counsel to appear for a conference may result in a sanction authorized by section 130.2.1 of the Rules of the Chief Administrator or section 202.27 of this Part, including dismissal, the striking of an answer, an inquest or direction for judgment, or other appropriate sanction.”

The majority is of the belief that rule 12 is inapplicable because a mediation under the Commercial Division’s ADR process is not a “conference.” However, rule 12 is included in the same section as rule 3, which empowers the court to direct mediation, and the Supreme Court, New York County, “Guide to the Alternative Dispute Resolution Program” defines “mediation” as “[a] process in which a Neutral attempts to facilitate a settlement of a dispute by conferring informally with the parties, jointly and in separate ‘caucuses,’- and focusing upon practical concerns and needs as well as the merits of each side’s position” (available at http://www.nycourts.gov/courts/comdiv/ PDFs/NYCounty/Attachment2.pdf, at 2). Further, rule 8 (h) of the Commercial Division, Supreme Court, New York County, Rules of the Alternative Dispute Resolution Program, provides that “[t]he Justice may impose sanctions or take such other action as is necessary to ensure respect for the court’s Order and these Rules.”

On the record before us, striking the complaint and the reply to counterclaims was a provident exercise of discretion. *446“ [Mediation procedures were established to resolve cases expeditiously and conserve judicial resources,” and a party’s failure to abide by the directives of a mediator evidences willful and contumacious conduct (Perez-Wilson v McPhee, 23 Misc 3d 1053, 1055 [Sup Ct, NY County 2009]). Continued noncompliance with court orders also gives rise to an inference of willful and deliberate behavior (see Jones v Green, 34 AD3d 260 [2006]). Here, despite the fact that it had previously been sanctioned for discovery delays and had its note of issue stricken, plaintiff demonstrated utter disregard for the court, the appointed mediator, and for opposing counsel by its failure to make Mr. Schwarz available for more than three months after the mediation order was entered, failure to submit a mediation statement, and failure to tell either the mediator or the defendants that it would not file until after the deadline passed.

Plaintiffs motion for renewal on the ground that it should not be sanctioned for its counsel’s misconduct was correctly denied. Plaintiff did not submit adequate documentation of the alleged lack of communication between it and Mr. Abraham and the court properly denied plaintiff an adjournment to cure this deficiency (see Wolosin v Campo, 256 AD2d 332 [1998]; Ritt v Lenox Hill Hosp., 182 AD2d 560, 561-562 [1992] [rejecting defendant’s reply containing a medical affidavit designed to cure the conclusory affidavit submitted with its initial motion]). In any event, plaintiffs in-house counsel received a copy of defendants’ attorney’s February 16, 2010 letter to the court, which referenced the first sanctions order, enumerated deficiencies in plaintiff’s discovery responses, mentioned extensions to the note of issue deadline, and requested permission to file a second motion to dismiss. Given these circumstances, Supreme Court correctly found that plaintiffs in-house counsel was on notice of the situation and should have monitored it more closely, rendering plaintiff chargeable with the conduct of its attorney (see Santiago v Santana, 54 AD3d 929, 930 [2008] [“Even if the plaintiffs former attorney was responsible for both the lengthy delay in proceeding with trial and the plaintiffs failure to appear on the last three scheduled trial dates, where there is a pattern of default and neglect, the negligence of the attorney is properly imputed to the client”]). [Prior Case History: 29 Misc 3d 1222(A), 2010 NY Slip Op 51942(U).]