Robert S. Kelner and Gail S. Kelner (NYLJ/Rick Kopstein)
General Municipal Law §50-e directs a party seeking to bring suit against a public corporation to serve a notice of claim upon the entity within 90 days after the claim arises. Unfortunately, there are occasions where, for a variety of reasons, it is not timely served. General Municipal Law §50-e(5) grants the motion court the discretion to extend the time to serve a notice of claim. Such an application must be made prior to the expiration of the statute of limitations to commence the action. The very recent decision of the Court of Appeals in Newcomb v. Middle Country Central School, 2016 N.Y. Slip. Op. 08581 (December 2016) will have a profound impact on these applications.
The statute provides in pertinent part as follows:
Upon application, the court, in its discretion, may extend the time to serve a notice of claim specified in paragraph (a) of subdivision one. The extension shall not exceed the time limited for the commencement of an action by the claimant against the public corporation. In determining whether to grant the extension, the court shall consider, in particular, whether the public corporation or its attorney or its insurance carrier acquired actual notice of the essential facts constituting the claim within the time specified in subdivision one or within a reasonable time thereafter. The court shall also consider all other relevant facts and circumstances … ; and whether the delay in serving the notice of claim substantially prejudiced the public corporation in maintaining its defense on the merits.
In evaluating the application, the statute requires the court to consider all relevant factors in exercising its discretion. Especially significant is whether the public corporation acquired actual knowledge of the essential facts within the 90-day period after the accrual of the claim or within a reasonable time thereafter. However, this is not the sole criterion. The statute directs the court to consider “all other facts and circumstances,” and provides a list suggesting the type of factors to be considered.
A crucial factor in any analysis is whether the public entity has been substantially prejudiced by the delay beyond the 90-day statutory limit in maintaining a defense on the merits. The analysis of this particular issue has spawned a significant body of conflicting case law among the various Appellate Division departments. Decisions have differed over which party bears the initial burden of proof. Further, there have been sharply disparate opinions over the type of submission that must be interposed by the respondent to make a showing of substantial prejudice sufficient to defeat the application. Both of these issues were addressed by the Court of Appeals in Newcomb v. Middle Country Central School District.
In Newcomb, petitioner’s son was seriously injured when he was struck by a vehicle at an intersection. Although petitioner repeatedly demanded the police accident file, its release was delayed for more than six months until the investigation was completed. Petitioner had a photographer take pictures within 90 days and served a notice of claim upon the state, town and county but not the school district, although the incident had been reported to the infant’s high school. Ultimately, the police photographs, which were released when the investigation was complete, showed a large sign at the accident site, advertising a school play at another school in the district. The sign had been removed before petitioner took his photographs. The police photograph showed that this sign may have been a hazard which contributed to the accident.
Petitioner thereafter moved for leave to serve a late notice of claim on the school district. Although many factors were considered, the pivotal issue was whether there would be substantial prejudice to the school district if a late notice of claim were permitted. Petitioner argued that the school district had placed the sign at the intersection and removed it within the 90 days, and that it knew about the accident within a few days of the occurrence. Further, the school district had access to the police file and photographs to reconstruct the scene and interview witnesses.
Respondent’s opposition was limited to its counsel’s affirmation, which merely contended that petitioner bore the burden of establishing lack of prejudice and failed to do so. Respondent’s counsel also asserted that the court should infer that the passage of time created substantial prejudice due to the fading memory of the witnesses. It did not submit an affidavit or other evidentiary submission from any person with knowledge to show that the school district would be prejudiced. In reply, petitioner responded that the conclusory allegations that the passage of time created an inference of prejudice was insufficient to overcome petitioner’s prima facie showing that there was no prejudice.
The trial court considered four factors in reviewing petitioner’s application. It determined that the school district did not have actual notice of the essential facts within the statutory 90-day period and that the delay was justifiable because of the serious injuries sustained by the infant, but not because of his infancy. However, the crucial factor at issue was whether the school district had suffered substantial prejudice by the delay. Following Appellate Division, Second Department, precedent such as Hill v. New York City Transit Authority, 68 A.D.3d 866 (2d Dept. 2009) and Castro ex rel. Sanabria v. Clarkstown Cent. School Dist., 65 A.D.3d 1141 (2d Dept. 2009), the trial court held that the burden of proof was on the petitioner to show that there was no substantial prejudice to the school district.1
Again following Appellate Division, Second Department, decisional law,2 the trial court accepted respondent’s assertion that substantial prejudice could be inferred by the mere passage of time because of the “fading memories of witnesses” and rejected the application. The decision was affirmed by the Appellate Division.3
The Court of Appeals reversed, holding that the denial of petitioner’s application was an abuse of discretion. There was absence of any evidence to support respondent’s contention that it would be substantially prejudiced in defending the claim. The court addressed both the burden of proof and the inference of prejudice from the mere passage of time. It found that it was improper to place the burden of proof solely on the petitioner and rejected respondent’s assertion that it was prejudiced by the mere passage of time.
The Burden of Proof
The most significant aspect of Newcomb addresses the burden of proof to demonstrate that a late notice of claim substantially prejudices the public corporation. In so doing, and in articulating a definitive rule, it resolved the issue as to which party bears the burden of proof on this issue.
The Court of Appeals stated that the lower courts in Newcomb improperly placed the burden of proof on this issue solely on petitioner. It then formulated the rule that the initial burden rests on the petitioner to show that the late notice will not substantially prejudice the public corporation. The showing need not be extensive, but petitioner must present “some evidence or plausible argument” to support a finding of no substantial prejudice. Once the initial showing has been made, the public corporation must make a responsive “particularized” evidentiary showing that it would be substantially prejudiced if late notice were allowed. The Court of Appeals held:
The rule we endorse today—requiring a petitioner to make an initial showing that the public corporation will not be substantially prejudiced and then requiring the public corporation to rebut that showing with particularized evidence—strikes a fair balance.
Applying this rule, the Court of Appeals in Newcomb reversed the Appellate Division and found in petitioner’s favor. It determined that he had satisfied his initial burden by showing that there were police photographs that would permit the school district to reconstruct conditions on the date of the accident. In opposing the application, the school district failed to meet its burden to make a showing of prejudice with a particularized evidentiary response. Its opposition merely consisted of an attorney’s affirmation that it did not have actual notice and allegations that petitioner failed to show a lack of prejudice. The court stated that it was an abuse of discretion to determine as a matter of law that respondent would be substantially prejudiced where there was no evidence in the record to support this assertion. It stated:
We hold that a finding that a public corporation is substantially prejudiced by a late notice of claim cannot be based solely on speculation and inference; rather, a determination of substantial prejudice must be based on evidence in the record.
Passage of Time Is Insufficient
The holding in Newcomb should forestall any future determinations that substantial prejudice may be inferred solely from the unsupported contention that the mere passage of time creates prejudice with respect to fading memories of witnesses. In striking a fatal blow to this all too common contention by a public corporation, the Court of Appeals in Newcomb held that the mere passage of time will not constitute substantial prejudice without specific evidentiary proof. It stated that providing proof of substantial prejudice is qualitatively and quantitatively different from a mere inference of prejudice. It held:
Although changes in personnel and the fading memories of witnesses may, in fact, be “prejudicial,” a court must consider whether record evidence indicates that substantial prejudice does in fact exist. Providing proof of substantial prejudice on the record is qualitatively and quantitatively different from a mere inference of prejudice. Generic arguments and inferences will not establish “substantial prejudice” in the absence of facts in the record to support such a finding.
The holding in Newcomb is consistent with earlier Appellate Division, First Department, decisions that found that prejudice will not be presumed and may not be shown without evidence of an attempt to investigate the accident. Thomas v. New York City Hous. Auth., 132 A.D.3d 432 (1st Dept. 2015). In Goodwin v. New York City Hous. Auth., 42 A.D.3d 63, 68 (1st Dept. 2007), the court aptly stated that prejudice “may not be shown without evidence of an attempt to investigate the accident.”
Prior case law, often addressing transitory conditions, may offer some guidance as to the type of showing that may satisfy a petitioner’s initial burden of proof. For example, in Gamoneda v. New York City Bd. of Educ., 259 A.D.2d 348 (1st Dept. 1999), the court found no prejudice to the public entity where it was in receipt of an accident report and a police aided report, which indicated that there were no witnesses to the accident. In Gerzel v. City of New York, 117 A.D.2d 549 (1st Dept. 1986), respondent had an accident report filed at the building where the accident occurred and photographs. The report contained the date, time, and place of the alleged accident, the manner in which the injuries occurred and the nature of the injury as well as petitioner’s statement that he did not see the step in question. The court held that “the accident report and the photographs taken sufficiently connected the accident and the alleged defective condition in the steps …” It was not important that the report was filed on the premises where the accident occurred rather than at the police station. In Caridi v New York Convention Ctr. Operating, 47 A.D.3d 526 (1st Dept. 2008), there was no prejudice where there was an available report of a police investigation conducted immediately after the occurrence which included witness interviews and contemporaneous photographs of the scene.
Newcomb is a very significant decision, which establishes important basic principles to be followed in applications for late notices of claim.
1. In re Newcomb v. Middle Country Cent. School Dist., 2014 WL 2206196 (N.Y. Sup.),
2. See, for example, Felice v. Eastport/South Manor Cent. School Dist., 50 A.D.3d 138 (2d Dept. 2008); Joseph v. City of New York, 101 A.D.3d 721 (2d Dept. 2012); Matter of Farfan v. City of New York, 101 A.D.3d 714 (2d Dept. 2012).
3. Newcomb v. Middle Country Cent. School Dist., 128 A.D.3d 701, 703 (2d Dept 2015), lv. to appeal granted, 26 N.Y.3d 905 (2015), and rev’d, 2016 NY Slip Op 08581 (Ct. App. Dec. 22, 2016).