Borchshenko v Ricketts

[*1] Borchshenko v Ricketts 2007 NY Slip Op 51208(U) [16 Misc 3d 1101(A)] Decided on June 15, 2007 Supreme Court, Kings County Battaglia, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on June 15, 2007
Supreme Court, Kings County

Nadezhda Borchshenko, Plaintiff,

against

Ian Ricketts and New York City Police Department, Defendants.



13080/06



Plaintiff was represented by Yuriy Prakhin, Esq.

The City was represented by Michael Shender, Esq. of the Corporation Counsel of the City of New York.

Jack M. Battaglia, J.

On the City's motion, the Court must dismiss Plaintiff's Complaint as time-barred, even though she accepted the City's offer to settle the case for $25,000.00.

On November 22, 2004, Plaintiff allegedly sustained personal injuries in a motor vehicle accident. On May 1, 2006, Plaintiff commenced an action against the City by filing a Summons [*2]and Complaint. On June 26, 2006, the City interposed its Answer raising the statute of limitations as an affirmative defense. On October 24, 2006, the case was marked "disposed" after Plaintiff failed to appear for a Preliminary Conference. Thereafter, the City moved to restore the action and to dismiss

Plaintiff's Complaint based upon the expiration of the 1-year-and-90-day limitations period of General Municipal Law § 50-i.

By Order, dated February 16, 2007, this Court restored the case to active status, and set the matter down for a framed-issue hearing for argument and testimony regarding the City's motion to dismiss, more particularly regarding Plaintiff's contention that the City should be equitably estopped from raising the statute of limitations as a defense and/or that the City waived the statute of limitations.

There is no dispute that Plaintiff's action was untimely filed. Plaintiff contends, however, that based upon representations made by the City before and after the expiration of one year and ninety days (see General Municipal Law § 50-i), the City should be equitably estopped from raising the affirmative defense of the statute of limitations or that it, in effect, waived the defense. Plaintiff contends, moreover, that, in any event, Plaintiff and the City made a settlement agreement.

In support of her contentions, Plaintiff submits the affidavit of Anna Dopiro, a paralegal in the office of Plaintiff's counsel, Yuriy Prakhin, Esq. (As will appear, the parties agreed that Plaintiff would rely solely on Ms. Dopiro's affidavit.) Ms. Dopiro avers that, on November 26, 2005, she forwarded Plaintiff's medical records to the City of New York. On November 30, 2005, she spoke with Mr. Thomas Varughese, an employee of the City's Comptroller's office, who made an offer in the amount of $3000.00 to settle the claim. Significantly, Ms. Dopiro continues that, "[o]n December 9, 2005 I spoke with Mr. Varughese again and advised him that the client is still treating and suggested to raise his offer. Mr. Varughese requested that I submit additional medical records. I stressed that the statute of limitations is fast approaching and we either need to resolve it or my office will commence an action. Mr. Varughese assured me that the case will settle once I submit additional medicals and there is no need to commence a suit as he will settle the case." (Affidavit of Anna Dopiro, Exhibit A to Affirmation in Opposition, ¶5.)

Ms. Dopiro avers that two months later, on February 9, 2006, she forwarded additional medical records to Mr. Varughese, and then on February 27, 2006, "after the statute of limitations had run out, I called Mr. Varughese and he raised his offer to $4000.00. After I pointed out the seriousness of Ms. Borchshenko's injuries, Mr. Varughese suggested that I submit additional medical records to [*3]substantiate our claim that the client developed Horizontal diplopia [sic] as a result of this accident." (Id., ¶7).

On March 21, 2006, Ms. Dopiro forwarded additional medical records to Mr. Varughese. On April 17, 2006, Ms. Dopiro called Mr. Varughese, who refused to discuss settlement since the statute of limitations had expired.

On May 1, 2006, the action was commenced (even though Ms. Dopiro at least was aware that the limitations period had expired.) On October 26, 2006, Ms. Dopiro spoke with Samia Zaman of the City Law Department's Early Settlement Unit, who requested that the case be submitted for an Early Settlement Conference. On November 9, 2006, Ms. Dopiro spoke with Martha Rix, Esq of the Early Settlement Unit, who, after negotiations, offered Plaintiff the sum of $25,000.00. On November 13, 2006, "the client came to the office and executed General Releases. The stipulation of discontinuance together with releases was mailed to Law Department the same date." (Id., ¶16.)

Later that same day, Plaintiff was served with the instant motion to restore and to dismiss based upon the expiration of the statute of limitations. Yet, on November 28, 2006, Ms. Dopiro spoke with "Shaniya from the Law Department who requested that we submit an Affidavit of no Welfare before the check can be issued." (Id., ¶18.) Ms. Dopiro avers that the "no Welfare" affidavit was sent on December 4, 2006, but on January 3, 2007, she received a call from Martha Rix, Esq. of the Law Department, who advised her that the settlement offer was withdrawn, and who apologized for failing to check her file prior to settlement negotiations.

During the framed-issue hearing, it was agreed that Plaintiff would rely solely upon Ms. Dopiro's affidavit. The City contended that, assuming the truth of Ms. Dopiro's averments, Plaintiff failed to establish an equitable estoppel and/or waiver of the statute of limitations. As such, Plaintiff decided to rely on Ms. Dopiro's affidavit and the City, in effect, decided to waive its right to cross-examine Ms. Dopiro.

In opposition to the averments of Ms. Dopiro, the City produced Thomas Varughese, who works for the Office of the Comptroller, and who conducted the settlement negotiations with Ms. Dopiro. Mr. Varughese testified that, as part of his job duties, he investigates and settles claims. Significantly, Mr. Varughese denied ever advising Ms. Dopiro to not commence an action. Mr. Varughese testified, moreover, that the last conversation he had with Ms. Dopiro was on February 13, 2006, wherein he offered $4000.00. It is undisputed that Ms. Dopiro and Mr. Varughese never reached a settlement agreement.

"The doctrine of estoppel will be applied against governmental agencies only in exceptional cases." (Yassin v Sarabu, 284 AD2d 531, 531 [2d Dept 2001]; see also Lily Pond Enterprises v City of New York, 149 AD2d 412, 413 [2d Dept 1989]; Matter of Griffith v Staten Island Rapid Transportation Operating Authority, 269 AD2d 596, 597 [2d Dept 2000] ["Generally, the doctrine of estoppel is not applicable to municipalities acting in a governmental capacity."].) [*4]

"However, a municipality may be estopped from asserting that a claim was untimely filed when its improper conduct induces reliance by a party who changes his or her position to his or her detriment or prejudice." (Matter of Griffith v Staten Island Rapid Transportation Operating Authority, 269 AD2d at 597 [citing Bender v New York City Health & Hosps. Corp., 38 NY2d 662, 668 (1976)].) "Only a showing of fraud, misrepresentation, deception, or similar affirmative misconduct, along with reasonable reliance thereon, will justify the imposition of estoppel." (Yassin v Sarabu, 284 AD2d at 531.)

It has been repeatedly held that inquiries and allusions to possible future settlement do not

give rise to an estoppel where there is no evidence that the defendant intended to lull the plaintiff into inactivity until after the expiration of the statute of limitations. (See Terry v Long Island Railroad, 207 AD2d 881, 882 [2d Dept 1994]; Kiernan v Long Island Rail Road, 209 AD2d 588, 589 [2d Dept 1994]; Green v Albert, 199 AD2d 465, 466-67 [2d Dept 1993]; Rains v Metropolitan Transporation Authority, 120 AD2d 509, 509 [2d Dept 1986].)

Here, even assuming the truth of Ms. Dopiro's averment that, on December 9, 2005, Mr. Varughese "assured" her that "the case will settle" once she submitted additional medical records, and that there was "no need to commence a suit as he will settle the case," such statements, within the context of routine settlement discussions, do not justify the imposition of an equitable estoppel. Since there was at least two more months for Ms. Dopiro to forward the medical records, hold further settlement discussions, and possibly reach an agreement prior to the expiration of the statute of limitations, Mr. Varughese's statements to Ms. Dopiro could not reasonably have been meant to lull Ms. Dopiro into inactivity. (See Green v Albert, 199 AD2d at 467; see also Kiernan v Long Island Rail Road, 209 AD2d at 589; Terry v Long Island Railroad, 207 AD2d at 882; Rains v Metropolitan Transporation Authority, 120 AD2d at 509.)

Rather, it appears, at most, that Mr. Varughese "maintained conventional communication" (see Terry v Long Island Railroad, 207 AD2d at 882) during settlement negotiations with Ms. Dopiro by requesting proof of damages, and assuring Ms. Dopiro that, if the proof of damages confirmed Plaintiff's claimed damages, the City might offer a sum that might satisfy Plaintiff. Ms. Dopiro admits, moreover, that she did not provide the requested medical records until two months later on February 9, 2006, and did not contact Mr. Varughese regarding settlement until February 27, 2006, when the statute of limitations had already expired.

Although Ms. Dopiro is not an attorney, her office should have known, as a matter of law, that Administrative Code § 7-202 provides that the Comptroller cannot extend the time within which to commence an action against the City other than by a written stipulation. Here, it is undisputed that Mr. Varughese did not execute a stipulation to extend the time to commence an action.

Plaintiff has failed, therefore, to establish facts necessary to justify the imposition of an equitable estoppel as against the City. [*5]

Plaintiff's further contention that the City waived its defense of the statute of limitations by continued settlement negotiations and agreement following the expiration of the statute of limitations is also without merit. Initially, even assuming the truth of Ms. Dopiro's averment that she reached a verbal settlement agreement with the City's Early Settlement Unit, such agreement was never reduced to a writing signed by the parties or their attorneys and, as such, was not an enforceable settlement. (See CPLR 2104; Bonnette v Long Island College Hospital, 3 NY3d 281, 286 [2004]; DeVita v Macy's East, Inc., 36 AD3d 751, 751 [2d Dept 2007].)

Even so, Plaintiff contends that the City's conduct amounts to a waiver of the defense of statute of limitations. General City Law 20(5) provides that the City "shall have no power to waive the defense of the statute of limitations." It has been held, nonetheless, that where the City fails to raise the defense of the statute of limitations either in a pleading or by a motion in a pending action, a municipal defendant, like any other, will thereafter be precluded from raising such a defense. (Rubino v City of New York, 145 AD2d 285, 289 [1st Dept 1989].) Here, the City raised the defense of the statute of limitations in its Answer and, thereafter, brought the instant motion to dismiss the Complaint based upon the expiration of the statute of limitations.

While there seems to be an incongruity between General City Law § 20(5), which states that the City does not have the power to waive the statute of limitations, and Administrative Code § 7-202, which permits the Comptroller to stipulate in writing to an extension of the limitations period, the Court of Appeals has held that "an agreement to extend the Statute of Limitations is not truly a waiver unless it is made after the statutory period has run." (See John J. Kassner & Co., Inc. v City of New York, 46 NY2d 544, 552 [1979].) Thus, prior to the expiration of the statutory period, the Comptroller may enter into a written stipulation extending the time to commence an action under Administrative Code § 7-202. (Id.) The Comptroller may not, however, enter into such stipulation after the expiration of the statutory period, since to do so would constitute a waiver of the statute of limitations, which the City lacks the power to do under General City Law § 20(5). (Id.) In this case, the Comptroller never signed a stipulation to extend Plaintiff's time to commence an action either before or after the expiration of the limitations period. Under General City Law 20(5), it is clear that the Early Settlement Unit's representations to Plaintiff's attorney's paralegal after the expiration of the limitations period cannot waive the City's defense of the statute of limitations.

The Court acknowledges that the City through the Comptroller's Office and the Early Settlement Unit improperly made inconsistent representations to Plaintiff's counsel's paralegal. Based upon the overall circumstances, however, it would have been fair for Plaintiff's counsel to assume that there was a mistake and to at least make a further inquiry. Ms. Dopiro's affidavit acknowledges that the Comptroller's Office informed her that the City would not settle the claim because the action was time-barred. On June 26, 2006, the City had already raised the statute of limitations as an affirmative defense in its Answer. Even though Plaintiff had been served with the instant motion to dismiss based upon the expiration of the statute of limitations on November 13, 2006, Ms. Dopiro avers that on November 28, 2006 she spoke with "Shaniya from the Law Department who requested that we submit an Affidavit of no Welfare before the check can be issued." At this point, it must have been apparent that something was amiss with the Early [*6]Settlement Unit. Ms. Dopiro's affidavit does not address whether she ever discussed the issue of the expiration of the statute of limitations with the Early Settlement Unit and, in any event, Plaintiff should have known, as a matter of law, that the City cannot extend the limitations period or waive its statute of limitations defense once the limitations period has expired, except under circumstances not present here.

Accordingly, Defendants' motion to dismiss Plaintiff's Complaint is granted.

June 15, 2007

__________________

Jack M. Battaglia

Justice, Supreme Court