The Importance of Complying With Court Orders

• Posted on: Sep 27 2021

By: Jeffrey M. Haber

Default judgments are a part of litigation. In New York, a default judgment may be entered “[w]hen a defendant has failed to appear, plead or proceed to trial of an action reached and called for trial, or when the court orders a dismissal for any other neglect to proceed, ….”¹ 

The consequences of a default can be severe. Among other things, it allows the prevailing party to enforce the judgment using all the tools available under Article 52 of the CPLR. 

However, the party against whom judgment is entered can seek to vacate the judgment, when he/she can demonstrate, among other things, “fraud, misrepresentation, or other misconduct of an adverse party.” CPLR § 5015. Although there is no express time limit for seeking relief from a judgment under CPLR § 5015 (a)(3), a party is required to make the motion within a reasonable time.² 

Sometimes, the judge will direct a party to do something in the order or judgment, which if not done can result in vacatur of the order or judgment. That was the situation in Bank of Am., N.A. v. Campbell, 2021 N.Y. Slip Op. 50897(U) (Sup. Ct., Nassau County Sept. 20, 2021) (here).

In Bank of America, Plaintiff obtained a judgment on March 25, 2016, upon Defendant’s default in answering the complaint. Thereafter, Defendant filed an order to show cause to vacate the judgment. Under the terms of the order, Defendant was required to file a note of issue in order to set the schedule for the traverse hearing granted by the Court. According to the Court’s records, the traverse hearing was never calendared in the Calendar Control Part because Defendant never filed the note of issue as directed. The matter did not appear on a court calendar until Plaintiff filed its order to show cause in February 2021.³

The Court observed that more than four years elapsed before either party “ask[ed] the Court to address th[e] matter again.”⁴ This span of time was critical to Defendant, who claimed that she was unaware of the decision because she was never served with the decision and notice of entry of the order by Plaintiff. The Court found the failure to file and serve a notice of entry to be an important factor in its decision: “the long-standing rule is that the party seeking to limit the time of another to take an appeal must strictly conform to the rules of practice and service of a judgment or order by the prevailing party on a motion is required to start the running of the limitations period.”⁵ “Thus,” concluded the Court, “since Defendant was the movant on the application and because she would be deemed to be the prevailing party, it was her obligation to serve a copy of the decision and order with notice of entry upon Plaintiff, not the contrariwise.”⁶ While the failure to serve the judgment with notice of entry was important, it was not dispositive. It was the failure to file the note of issue, “as directed”, that the Court found to be dispositive: “[a]lthough neither party can claim responsibility for having served a copy of the decision and order with notice of entry upon its/her opponent, Defendant blatantly failed to satisfy its obligations as directed.”⁷

Accordingly, the Court held that:

Given the foregoing, this Court finds that the misconduct on the part of Defendant by failing to file a note of issue and place the matter on the Court’s calendar for a traverse hearing as directed warrants vacatur of the decision and order of Justice Iannacci dated December 20, 2016. The egregiousness of the delay by Defendant coupled with a lack of a reasonable excuse for the asserted law office failure requires a conclusion that Defendant’s application was either purposefully abandoned or Defendant attempted to prejudice Plaintiff at a traverse hearing through the passage of more than four (4) years’ time. Therefore, the motion by Plaintiff is hereby granted in full, over opposition.⁸

Takeaway

Although judges may excuse non-compliance or impose some form of sanction on the non-compliant party that is not fatal to that party’s rights, Bank of America shows that the failure to comply with a court’s order can sometimes be fatal.

Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP.

This article is for informational purposes and is not intended to be and should not be taken as legal advice.

Resources:

1. CPLR § 3215(a).
2. Aames Capital Corp. v. Davidsohn, 24 A.D.3d 474 (2d Dept. 2005).
3. Plaintiff requested an order deeming Defendant’s application to vacate the judgment as abandoned.
4. Slip Op. at *2.
5. Id. (citing Williams v. Forbes, 157 A.D.2d 837 (2d Dept. 1990)).
6. Id.
7. Id.
8. Id.