author: Jones, J.

text:
    [899 NE2d 920, 870 NYS2d 814]
    Episcopal Diocese of Rochester et al., Respondents, v David Harnish, Former Rector of All Saints Protestant Episcopal Church, et al., Appellants, et al., Defendants. In the Matter of All Saints Anglican Church, Formerly Known as All Saints Protestant Episcopal Church, Appellant, v Episcopal Diocese of Rochester et al., Respondents.
    Argued September 9, 2008;
    decided October 23, 2008

      POINTS OF COUNSEL

      Eugene Van Voorhis, Rochester, and Adam Clark for appellants in the first and second above-entitled matters.
    I. Plaintiffs-respondents in action No. 1 and respondent-respondent in action No. 2 did not make a showing of sufficient admissible, undisputed evidence as a matter of law to warrant summary judgment declaring that an express or implied trust in All Saints Protestant Episcopal Church’s property was ever created in favor of the Episcopal Diocese of Rochester and/or the Protestant Episcopal Church in the United States of America. (JMD Holding Corp. v Congress Fin. Corp., 4 NY3d 373; Winegrad v New York Univ. Med. Ctr., 64 NY2d 851; Zuckerman v City of New York, 49 NY2d 557; Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395; Matter of Redemption Church of Christ of Apostolic Faith v Williams, 84 AD2d 648; Greenberg v Manlon Realty, 43 AD2d 968; Glick & Dolleck v Tri-Pac Export Corp., 22 NY2d 439; Trustees of Diocese of Albany v Trinity Episcopal Church of Gloversville, 250 AD2d 282; Jones v Wolf, 443 US 595; Watson v Jones, 13 Wall [80 US] 679.) II. Under neutral principles of law All Saints Protestant Episcopal Church (All Saints) does not hold its property in trust for the Episcopal Diocese of Rochester or for Protestant Episcopal Church in the United States of America (ECUSA), and mere passage of Protestant Episcopal Church in the United States of America canons 1.7.4 and 1.7.5 (Dennis Canon) could not create a trust in All Saints’ property under New York law, nor did the Dennis Canon codify existing ECUSA polity. (Board of Mgrs. of Diocesan Missionary & Church Extension Socy. of Prot. Episcopal Church in Diocese of N.Y. v Church of Holy Comforter, 164 Misc 2d 661, 212 AD2d 657; Presbytery of Hudson Riv. of Presbyt. Church [U.S.A.] v Trustees of First Presbyt. Church & Congregation of Ridgeberry, 13 Misc 3d 707; Trustees of Diocese of Albany v Trinity Episcopal Church of Gloversville, 250 AD2d 282.) III. Expulsion of All Saints Protestant Episcopal Church (All Saints) from the Episcopal Diocese of Rochester (Diocese) could not trigger a forfeiture of All Saints’ property to the Diocese under neutral principles of New York law. (Westminster Presbyt. Church of W. Twenty-Third St. v Trustees of Presbytery of N.Y., 211 NY 214; Ludlow v Rector, Church Wardens & Vestrymen of St. John’s Church, 68 Misc 400, 144 App Div 207, 207 NY 689; Matter of Venigalla v Alagappan, 307 AD2d 1041; Watson v Christie, 288 AD2d 29; Natoli v Milazzo, 9 Misc 3d 1116[A], 2005 NY Slip Op 51570[U], 35 AD3d 823; Rector, Churchwardens & Vestrymen of Church of Holy Trinity v Melish, 4 AD2d 256.) IV. It was error on the part of the trial court to predicate its decision of the effect of article 3 of the Religious Corporations Law on the relationship of All Saints Protestant Episcopal Church to the Episcopal Diocese of Rochester and Protestant Episcopal Church in the United States of America, especially since serious questions have been raised in the courts below by appellants as to the constitutionality of parts or all of the Religious Corporations Law under the Establishment Clause of the First Amendment to the Constitution of the United States and under the Preference Clause of article I, § 3 of the New York State Constitution. (Cantwell v Connecticut, 310 US 296; Lemon v Kurtzman, 403 US 602; McCreary County v American Civil Liberties Union of Ky., 545 US 844; Corporation of Presiding Bishop of Church of Jesus Christ of Latter-day Saints v Amos, 483 US 327; Larson v Valente, 456 US 228, 457 US 1111; Storm v Town of Woodstock, N.Y., 32 F Supp 2d 520; United States v Lee, 455 US 252; Morris v Scribner, 69 NY2d 418; Presbyterian Church in U. S. v Mary Elizabeth Blue Hull Memorial Presbyterian Church, 393 US 440; Trustees of Presbytery of N.Y. v Westminister Presbyt. Church of W. Twenty-Third St., 222 NY 305.) V. In resolving the difference between the decisions in the Third and Fourth Departments of the Appellate Division in Trustees of Diocese of Albany v Trinity Episcopal Church of Gloversville (250 AD2d 282 [3d Dept 1999]) and in the present case on the one hand and the decision of the Appellate Division, Second Department in Board of Mgrs. of Diocesan Missionary & Church Extension Socy. of Prot. Episcopal Church in Diocese of N.Y. v Church of Holy Comforter (164 Misc 2d 661 [Sup Ct, Dutchess County 1993], affd 212 AD2d 657 [2d Dept 1995]) on the other, it is respectfully submitted that the ruling in the latter case should be deemed the correct statement of New York law under neutral principles of law. (Jones v Wolf, 443 US 595.)

      Harter Secrest & Emery LLP, Rochester (Thomas G. Smith and Carol L. O’Keefe of counsel), for respondents in the first and second above-entitled matters.
    I. Under neutral principles of law analysis, All Saints Protestant Episcopal Church held its property in trust for the Episcopal Diocese of Rochester and the Protestant Episcopal Church in the United States of America. (Jones v Wolf, 443 US 595; First Presbyt. Church of Schenectady v United Presbyt. Church in U.S. of Am., 62 NY2d 110, 469 US 1037; North Cent. N.Y. Annual Conference v Felker, 28 AD3d 1130; Trustees of Diocese of Albany v Trinity Episcopal Church of Gloversville, 250 AD2d 282; Board of Mgrs. of Diocesan Missionary & Church Extension Socy. of Prot. Episcopal Church in Diocese of N.Y. v Church of Holy Comforter, 164 Misc 2d 661; Maryland & Virginia Eldership of Churches of God v Church of God at Sharpsburg, Inc., 396 US 367; North Cent. N.Y. Annual

      Conference v Felker, 28 AD3d 1130; Presbytery of Hudson Riv. of Presbyt. Church [U.S.A.] v Trustees of First Presbyt. Church & Congregation of Ridgeberry, 13 Misc 3d 707; Noel v L & M Holding Corp., 35 AD3d 681; Anderson v Livonia, Avon & Lakeville R.R. Corp., 300 AD2d 1134.) II. No justiciable controversy exists regarding the constitutionality of the Religious Corporations Law. (New York Pub. Interest Research Group v Carey, 42 NY2d 527; Islamic Ctr. of Harrison, Pa. v Islamic Science Found., 216 AD2d 357; Watson v Jones, 13 Wall [80 US] 679; Presbyterian Church in U. S. v Mary Elizabeth Blue Hull Memorial Presbyterian Church, 393 US 440; Serbian Eastern Orthodox Diocese for United States and Canada v Milivojevich, 426 US 696; Jones v Wolf, 443 US 595; Dixon v Edwards, 290 F3d 699; Tomic v Catholic Diocese of Peoria, 442 F3d 1036; Trustees of Diocese of Albany v Trinity Episcopal Church of Gloversville, 250 AD2d 282; Upstate N.Y. Synod of Evangelical Lutheran Church in Am. v Christ Evangelical Lutheran Church of Buffalo, 185 AD2d 693.) III. The applicable provisions of the Religious Corporations Law do not violate the national church canons and constitution. (People v Pagnotta, 25 NY2d 333; Matter of Van Berkel v Power, 16 NY2d 37; Lemon v Kurtzman, 403 US 602; Rector, Churchwardens & Vestrymen of Church of Holy Trinity v Melish, 4 AD2d 256, 3 NY2d 476; Kedroff v Saint Nicholas Cathedral of Russian Orthodox Church of North America, 344 US 94; Watson v Jones, 13 Wall [80 US] 679; Serbian Eastern Orthodox Diocese for United States and Canada v Milivojevich, 426 US 696; Jones v Wolf, 443 US 595; Maryland & Virginia Eldership of Churches of God v Church of God at Sharpsburg, Inc., 396 US 367.)

      Goodwin Procter LLP, Washington, DC (Heather H. Anderson, Adam M. Chud and Soyong Cho of counsel), for Episcopal Church, amicus curiae in the first and second above-entitled matters.
    I. The First Amendment prohibits governmental interference in the internal governance of churches. (Corporation of Presiding Bishop of Church of Jesus Christ of Latter-day Saints v Amos, 483 US 327; Watson v Jones, 13 Wall [80 US] 679; Kedroff v Saint Nicholas Cathedral of Russian Orthodox Church of North America, 344 US 94; Presbyterian Church in U. S. v Mary Elizabeth Blue Hull Memorial Presbyterian Church, 393 US 440; Maryland & Virginia Eldership of Churches of God, v Church of God at Sharpsburg, Inc., 396 US 367; Serbian Eastern Orthodox Diocese for United States and Canada v Milivojevich, 426 US 696; Jones v Wolf, 443 US 595; Avitzur v Avitzur, 58 NY2d 108; Park Slope Jewish Ctr. v Congregation

      B’nai Jacob, 90 NY2d 517.) II. The lower courts properly applied neutral principles of law analysis in this case. (First Presbyt. Church of Schenectady v United Presbyt. Church in U.S. of Am., 62 NY2d 110; Jones v Wolf, 13 Wall [80 US] 679; Trustees of Diocese of Albany v Trinity Episcopal Church of Gloversville, 250 AD2d 282; North Cent. N.Y. Annual Conference v Felker, 28 AD3d 1130.) III. The result dictated by New York precedent and reached by the lower courts in this case is consistent with authority from around the country. IV All Saints Protestant Episcopal Church is bound by the Protestant Episcopal Church in the United States of America’s express trust canon adopted in 1979. (Trustees of Diocese of Albany v Trinity Episcopal Church of Gloversville, 250 AD2d 282; Polin v Kaplan, 257 NY 277; Havens v King, 221 App Div 475, affd sub nom. Havens v Dodge, 250 NY 617; Jones v Wolf, 443 US 595.) V. The lower court’s decision is consistent with other applicable principles of New York law. (Polin v Kaplan, 257 NY 277; Havens v King, 221 App Div 475, affd sub nom. Havens v Dodge, 250 NY 617; Burt v Oneida Community, 137 NY 346; Temple Beth AM v Tanenbaum, 6 Misc 3d 373; Watson v Jones, 13 Wall [80 US] 679; Lefkowitz v Cornell Univ., 35 AD2d 166, 28 NY2d 876; Conklin v State of New York, 284 App Div 193; Saint Joseph’s Hosp. v Bennett, 281 NY 115.) VI. Appellants have not presented a justiciable controversy for ruling on the constitutionality of New York’s Religious Corporations Law. (New York Pub. Interest Research Group v Carey, 42 NY2d 527; Ashcroft v Mattis, 431 US 171; First Presbyt. Church of Schenectady v United Presbyt. Church in U.S. of Am., 62 NY2d 110.)

      Jacobowitz and Gubits, LLP, Walden (Donald G. Nichol of counsel), for Presbyterians for Constitutional Action, amicus curiae in the first and second above-entitled matters.
    I. Since the quitclaim from the Episcopal Diocese of Rochester to All Saints Protestant Episcopal Church is unambiguous, neutral principles of law must enforce the deed. (Loch Sheldrake Assoc. v Evans, 306 NY 297; Uihlein v Matthews, 172 NY 154; Jones v Wolf, 443 US 595; Watson v Jones, 13 Wall [80 US] 679; Matter of Piel, 10 NY3d 163; Mercury Bay Boating Club v San Diego Yacht Club, 76 NY2d 256; Matter of Cord, 58 NY2d 539; First Presbyt. Church of Schenectady v United Presbyt. Church in U.S. of Am., 62 NY2d 110.) II. The Episcopal Diocese of Rochester has failed to prove a trust beyond a reasonable doubt. (Congregation Yetev Lev D’Satmar of Kiryas Joel, Inc. v Congregation Yetev Lev D’Satmar, Inc., 9 NY3d 297; Beaver v Beaver, 117 NY 421; Jones v Wolf, 443 US 595.) III. The Episcopal constitution may not be enforced. IV The Religious Corporations Law is unconstitutional. (Grumet v Pataki, 93 NY2d 677; Petty v Tooker, 21 NY 267.)

      Raymond J. Dague, PLLC, Syracuse (Raymond J. Dague of counsel), for Church of the Good Shepherd, amicus curiae in the first and second above-entitled matters.
    I. The Jones v Wolf (443 US 595 [1979]) “neutral principles of law” standard does not allow civil enforcement of church canons in derogation of state property and trust law. (First Presbyt. Church of Schenectady v United Presbyt. Church in U.S. of Am., 62 NY2d 110; Watson v Jones, 13 Wall [80 US] 679.) II. Protestant Episcopal Church in the United States of America’s (ECUSA) own official commentaries on the ECUSA constitution and canons recognize the ECUSA property canons are not civilly enforceable. (Jones v Wolf, 443 US 595.) III. Protestant Episcopal Church in the United States of America canons I.7.4 and II.6.4 were never properly adopted. (Jones v Wolf, 443 US 595.)
   OPINION OF THE COURT

Jones, J.

The question before this Court is whether defendant All Saints Protestant Episcopal Church (All Saints, or the parish) held its real and personal property in trust for the benefit of plaintiff Episcopal Diocese of Rochester (Rochester Diocese) and nonparty Protestant Episcopal Church in the United States of America (National Church), such that upon the parish’s separation from the Rochester Diocese its property reverted back to the Rochester Diocese or the National Church. For the reasons stated below, we answer this question in the affirmative.

Background

The National Church was founded in the late 1700s and is a member of the Anglican Communion, a group of churches rooted in the doctrine, discipline and worship of the Church of England’s Book of Common Prayer. The National Church has a hierarchical form of governance. Its governing body, the General Convention, adopted—and periodically amends—a constitution and canons (the National Canons) that manifest its doctrinal law.

The Rochester Diocese is incorporated under article 3 of the Religious Corporations Law, which solely governs Protestant Episcopal parishes or churches. As a member of the National Church, the Diocese is governed by annual Conventions or Councils and, in addition to the National Canons, has adopted its own Diocesan Canons (the Rochester Canons).

All Saints was originally organized in 1927 as a mission under the ecclesiastical canons of the National Church and the Episcopal Diocese of Western New York. Later that year All Saints incorporated under article 3 of the Religious Corporations Law. In 1947, All Saints applied to the Rochester Diocese to be recognized as a parish in spiritual union with the Diocese. To this end, All Saints signed a document agreeing “to abide by and conform to the constitution and Canons in force in the Episcopal Diocese of Rochester and to conform to all the canonical and legal enactments thereof.” The Bishop of the Diocese approved this union, and All Saints thereafter became a parish.

Facts and Procedural History

Due to serious theological disputes between the Rochester Diocese and the vestry (the leadership) of All Saints, in November 2005, the governing body of the Rochester Diocese—the Diocesan Convention—approved a resolution declaring the parish ecclesiastically “extinct.” The Convention also resolved that All Saints’ real property and tangible and intangible assets were to be “transferred to the trustees of the [Rochester Diocese]." All Saints, however, maintained that it held legal title to the real and personal property and, as it held the property free and clear under New York property law, neither the Rochester Diocese nor the National Church had claim to the property.

Plaintiffs commenced the instant declaratory judgment action seeking, among other relief, (1) a judgment that the real and personal property of All Saints was impressed with a trust in favor of the Rochester Diocese and National Church, (2) an injunction barring All Saints from interfering with the Rochester Diocese’s ownership and use of the property and (3) an accounting. Defendants counterclaimed, seeking to (1) quiet title to the property, (2) declare certain provisions of the Religious Corporations Law null and void under the Establishment Clause of First Amendment of the United States Constitution and (3) enjoin the Rochester Diocese from trespassing and interfering in All Saints. Further, All Saints brought a CPLR article 78 proceeding against the Rochester Diocese, seeking to annul the determination declaring the parish extinct. All Saints argued that the Rochester Diocese abused its discretion and failed to follow its own rules and New York law when it declared All Saints extinct.

Relying on Trustees of Diocese of Albany v Trinity Episcopal Church of Gloversville (250 AD2d 282 [3d Dept 1999]), Supreme Court granted summary judgment to plaintiffs, declaring that All Saints held all the real and personal property of the local parish for the benefit of the Rochester Diocese and National Church and dismissing defendants’ counterclaims. The Appellate Division affirmed “for reasons stated in the decision at Supreme Court” and also affirmed Supreme Court’s dismissal of the article 78 petition since the Rochester Diocese’s decision to dissolve the parish was a purely ecclesiastical determination and not reviewable by the Court (43 AD3d 1406 [2007]). We granted defendants leave to appeal (9 NY3d 1027 [2008]) and now affirm.

Discussion

Plaintiffs argue that there has been both an express and implied trust in favor of the Rochester Diocese and the National Church since All Saints’ incorporation pursuant to article 3 of the Religious Corporations Law. Specifically, plaintiffs contend that All Saints expressly agreed to abide by the constitution and canons of the Rochester Diocese and is, therefore, subject to the trust doctrine of National Canons 1.7.4 and 1.7.5 (the Dennis Canons). Under the Dennis Canons, a parish holds its property in trust for the Diocese and the National Church. Plaintiffs also contend that Rochester Canon 8 reaffirms this doctrine, and that the Religious Corporations Law (see art 3, § 42-a; art 2, § 5) further supports their contention that a religious corporation, incorporated pursuant to article 3 of the Religious Corporations Law, holds its property in trust for the Diocese and the National Church. Finally, plaintiffs argue that All Saints has remained an Episcopal parish for more than 20 years after adoption of the Dennis Canons without challenging their substance or applicability.

Defendants contend that a factual question exists as to whether an express or constructive trust was created or existed in favor of the Rochester Diocese and/or the National Church when they were expelled from the Rochester Diocese. Specifically, defendants argue that they cannot be bound by the Dennis Canons because they were adopted in 1979, nearly 30 years after All Saints was accepted as a parish. Also, defendants question whether the Dennis Canons or Rochester Canon 8 create an express trust, effectively divesting All Saints of its property, without violating the due process provisions of the United States and New York State Constitutions. Moreover, defendants argue that there is nothing in any deed or will or in the All Saints certificate of incorporation that establishes a trust over the All Saints property for the benefit of the Rochester Diocese or the National Church. Defendants’ arguments are unavailing.

In First Presbyt. Church of Schenectady v United Presbyt. Church in U.S. of Am. (62 NY2d 110 [1984]) we adopted the neutral principles of law approach to church property disputes set forth by the United States Supreme Court in Jones v Wolf (443 US 595 [1979]).

“Under the neutral-principles approach, the outcome of a church property dispute is not foreordained. At any time before the dispute erupts, the parties can ensure, if they so desire, that the faction loyal to the hierarchical church will retain the church property. They can modify the deeds or the corporate charter to include a right of reversion or trust in favor of the general church. Alternatively, the constitution of the general church can be made to recite an express trust in favor of the denominational church. The burden involved in taking such steps will be minimal. And the civil courts will be bound to give effect to the result indicated by the parties, provided it is embodied in some legally cognizable form” (Jones, 443 US at 606 [emphasis added]).

The enactment of the Dennis Canons was apparently an attempt by the Episcopal Church to do exactly what this language suggested—to “ensure . . . that the faction loyal to the hierarchical church [would] retain the church property.”

Application of the neutral principles doctrine requires the court to focus

“on the language of the deeds, the terms of the local church charter, the State statutes governing the holding of church property, and the provisions in the constitution of the general church concerning the ownership and control of church property. The court must determine from them whether there is any basis for a trust or similar restriction in favor of the general church, taking special care to scrutinize the documents in purely secular terms and not to rely on religious precepts in determining whether they indicate that the parties have intended to create a trust or restriction” (First Presbyt. Church, 62 NY2d at 122 [citation omitted]).

In Trustees of Diocese of Albany v Trinity Episcopal Church of Gloversville, a case similar to this one, the Third Department noted that in many ways Dennis Canon 1.7.4 was adopted in response to Jones v Wolf, which “held that the constitution of a hierarchical church can be crafted to recite an express trust in its favor concerning the ownership and control of local church property” (Trinity, 250 AD2d at 285, citing Jones, 443 US at 606). The Third Department affirmed the judgment granted in favor of the diocese, concluding—despite the existence of deeds indicating that the local parish held unrestricted title to three parcels of land surrounding the church—that the property was held in trust for the benefit of the diocese and hierarchical church.

Here, applying the neutral principles of law approach to the case at bar, we find that there is nothing in the deeds that establishes an express trust in favor of the Rochester Diocese or National Church. All Saints’ certificate of incorporation, further, does not indicate that the church property is to be held in trust for the benefit of either the Rochester Diocese or the National Church. Nor does any provision of the Religious Corporations Law conclusively establish a trust in favor of the Rochester Diocese or National Church.

The remaining factor for consideration under neutral principles, however, requires that we look to “the constitution of the general church concerning the ownership and control of church property” (62 NY2d at 122). It is this factor that we find dispositive. We conclude that the Dennis Canons clearly establish an express tmst in favor of the Rochester Diocese and the National Church (see Jones, 443 US at 606), and that All Saints agreed to abide by this express trust either upon incorporation in 1927 or upon recognition as a parish in spiritual union with the Rochester Diocese in 1947. We therefore need not consider the existence of an implied trust. In agreeing to abide by all “canonical and legal enactments,” it is unlikely that the parties intended that the local parish could reserve a veto over every future change in the canons. We find it significant, moreover, that All Saints never objected to the applicability or attempted to remove itself from the reach of the Dennis Canons in the more than 20 years since the National Church adopted the express trust provision (cfi First Presbyt. Church, 62 NY2d at 125).

In conclusion, plaintiffs have established that they are entitled to the real and personal property at issue and defendants have not raised any triable issue of fact to preclude this determination. We have considered defendants’ remaining arguments in support of their declaratory judgment action and conclude that they lack merit. With regard to defendant’s article 78 petition, we conclude as did the Appellate Division, that plaintiffs’ resolution deeming the parish “extinct” was a nonreviewable ecclesiastical determination (see Matter of Congregation Yetev Lev D’Satmar, Inc. v Kahana, 9 NY3d 282 [2007]).

Accordingly, the Appellate Division orders should be affirmed, with costs.

Chief Judge Kaye and Judges Ciparick, Graffeo, Read, Smith and Pigott concur.

Orders affirmed, with costs.

      . Its predecessor was the Episcopal Diocese of Western New York.

      . A more detailed description of the history of and property relating to All Saints (e.g., the deeds) can be found in Episcopal Diocese of Rochester v Harnish (17 Misc 3d 1105[A], 2006 NY Slip Op 52600[U] [Sup Ct, Monroe County, Sept. 13, 2006]).

      . The parties acknowledge that the resolution was a purely ecclesiastical determination.

      . Subsequently, All Saints sought ecclesiastical oversight by other bodies within the Anglican Communion and All Saints notified plaintiff Rt. Reverend Jack M. McKelvey (Bishop of the Rochester Diocese), by letter, that it was now under the ecclesiastical authority of Archbishop Henry Oronibi, Archbishop of the Church of the Province of Uganda. It also sought to amend its certificate of incorporation to change its name from All Saints Protestant Episcopal Church to “All Saints Anglican Church.”

      . The Dennis Canons were adopted in 1979 by the General Convention of the National Church. They provide:
      “Sec. 4 All real and personal property held by or for the benefit of any Parish, Mission or Congregation is held in trust for this Church and the Diocese thereof in which Parish, Mission or Congregation is located. The existence of this trust, however, shall in no way limit the power and authority of the Parish, Mission or Congregation otherwise existing over such property so long as the particular Parish, Mission or Congregation remains a part of, and subject to, this Church and its Constitution and Canons. “Sec. 5 The several Dioceses may, at their election, further confirm the trust declared under the foregoing Section 4 by appropriate action, but no such action shall be necessary for the existence and validity of the trust.”

      . Rochester Canon 8 provides:
      “In conformity and consistent with the provisions of Title I, Canon 7, of the General Convention, it is hereby explicitly reaffirmed that all real and personal property held by or for the benefit of any Parish, Mission, Chapel, or Congregation located in the Diocese of Rochester is held in trust for the Episcopal Church and the Diocese of Rochester.”

      . Section 42-a, enacted in 1991, states:
      “Notwithstanding and in addition to the provisions of section five of this chapter, and subject always to the trust in which all real and personal property is held for the Protestant Episcopal Church and the Diocese thereof in which the parish, mission or congregation is located, the vestry or trustees of any incorporated Protestant Episcopal parish or church, the trustees of every incorporated governing body of the Protestant Episcopal Church and each diocese are authorized to administer the temporalities and property, real and personal, belonging to the corporation, for the support and maintenance of the corporation and, provided it is in accordance with the discipline, rules and usages of the Protestant Episcopal Church and with the provisions of law relating thereto, for the support and maintenance of other religious, charitable, benevolent or educational objects whether or not conducted by the corporation or in connection with it or with the Protestant Episcopal Church.”
      Under section 5, the trustees of a religious corporation “shall have the custody and control” of all church property and shall administer same in accordance with the rules of the corporation and ecclesiastical governing body.

      . However, since All Saints was incorporated under article 3 of the Religious Corporations Law, which only covers “PROTESTANT EPISCOPAL PARISHES OR CHURCHES,” we can conclude that it was a part of the Episcopal Church and Rochester Diocese until it became extinct in 2005.


source: Caselaw Access Project

author: Chief Judge Kaye.

license: Public Domain

text:
    [899 NE2d 933, 870 NYS2d 827]
    In the Matter of City of New York, Appellant, Relative to the Melrose Commons Urban Renewal Area, Phase II. Kaiser Woodcraft Corp., Respondent.
    Argued September 3, 2008;
    decided October 28, 2008

      POINTS OF COUNSEL

      Michael A. Cardozo, Corporation Counsel, New York City (Paul T. Rephen, Rita D. Dumain, Rochelle H. Cohen and Fred Kolikoff of counsel), for appellant.
    The courts below departed from well-established criteria in awarding claimant compensation for items that were not fixtures. (Matter of Village of Port Chester, 42 AD3d 465; Rose v State of New York, 24 NY2d 80; Matter of City of New York, 278 NY 276; Matter of City of New York, 256 NY 236; City of Buffalo v Michael, 16 NY2d 88; Marrara v State of New York, 12 NY2d 285; Matter of City of New York, 10 AD2d 498; Matter of Certain Prop. on N. Riv. in City of N.Y., 118 App Div 865; United States v Certain Prop. Located in Borough of Manhattan, City, County & State of N.Y., 306 F2d 439; Matter of City of New York [Quick Serv. Laundry], 48 AD2d 634.)

      Goldstein, Goldstein, Rikon & Gottlieb, P.C., New York City (Michael Rikon of counsel), for respondent.
    I. The well-established law of trade fixtures in condemnation proceedings requires compensation for machinery, tools and items used in a business which would lose substantial value upon removal. (United States v Miller, 317 US 369; City of Buffalo v Clement Co., 28 NY2d 241; Rose v State of New York, 24 NY2d 80; Marrara v State of New York, 12 NY2d 285; Banner Milling Co. v State of New York, 240 NY 533; Matter of Board of Water Supply of City of N.Y., 277 NY 452; New York, Ontario & W. Ry. Co. v Livingston, 238 NY 300; 520 E. 81st St. Assoc. v State of New

      York, 99 NY2d 43; Matter of Village of Port Chester v Sorto, 14 AD3d 570; Matter of City of New York [New York Life Ins. Co.], 21 NY2d 293.) II. New York’s eminent domain law inadequately compensates a trade fixture claimant. (Rose v State of New York, 24 NY2d 80; City of Buffalo v Clement Co., 28 NY2d 241; Banner Milling Co. v State of New York, 240 NY 533; Interlake Serv. Sta. v State of New York, 249 AD2d 275; Matter of Certain Prop, on N. Riv. in City of N.Y., 118 App Div 865, 189 NY 508; Matter of Village of Port Chester v Sorto, 14 AD3d 570; Kelo v New London, 545 US 469; Matter of Fisher [New York State Urban Dev. Corp.], 287 AD2d 262; Jackson v State of New York, 213 NY 34; Matter of City of New York, 57 AD2d 954, 44 NY2d 974.)

      Carter Ledyard & Milburn LLP, New York City (Joseph M. Ryan and Susan B. Kalib of counsel), for New York State Urban Development Corporation, amicus curiae.
    This Court should reverse the Appellate Division’s decision to the extent that it awarded compensation for items of personal property which are not affixed to the premises (or are attached solely for stability purposes), are of standard design and are usable in any woodworking or carpentry operation. (Potter v Cromwell, 40 NY 287; McRea v Central Natl. Bank of Troy, 66 NY 489; Matter of City of New York, 278 NY 276; Matter of Village of Port Chester, 42 AD3d 465; Rose v State of New York, 24 NY2d 80; Matter of City of New York, 256 NY 236; Banner Milling Co. v State of New York, 240 NY 533, 269 US 582; Matter of New York City Tr. Auth. [Superior Reed & Rattan Furniture Co.], 160 AD2d 705.)

      Milton H. Pachter, New York City, and Carlene V. McIntyre for Port Authority of New York and New Jersey, amicus curiae.
    The order of the Appellate Division should be reversed because the decision of that Court created a new and virtually limitless test for identification of personal property as trade fixtures in eminent domain proceedings without precedent in the law of this state, which will have an adverse effect upon the public interest if not overruled by this Court. (Rose v State of New York, 24 NY2d 80; Marraro v State of New York, 12 NY2d 285; Matter of City of New York, 192 NY 295; Matter of City of New York, 278 NY 276; Matter of New York City Tr. Auth. [Superior Reed & Rattan Furniture Co.], 160 AD2d 705; Belinky v State of New York, 24 AD2d 908; Matter of Village of Port Chester, 42 AD3d 465; Matter of City of New York, 27 AD2d 539; Matter of City of New York, 10 AD2d 498; Jackson v State of New York, 213 NY 34.)
   OPINION OF THE COURT

Chief Judge Kaye.

At the heart of this condemnation proceeding is the question whether certain equipment qualifies as compensable trade fixtures.

Factual Background

On July 20, 1998, the City of New York acquired title by eminent domain to property located at 3087 Third Avenue in the Bronx. The land was owned and occupied by Kaiser Woodcraft Corporation. For nearly 40 years Manfred Kaiser, founder and president of the corporation, operated a woodworking shop on the premises. In addition to seeking compensation for the underlying real estate, Kaiser’s appraiser claimed that 147 items were compensable trade fixtures. This litigation concerns only those items.

The items claimed as trade fixtures included about 38 standard industrial woodworking tools. Some were large (such as table saws—including, for example, a nine-foot-by-six-foot “Martin” table saw weighing at least 1,500 pounds—band saws, grinders, senders, slitters, routers, drill presses, jointers, borers and planers). Others were heavy-duty hand tools (such as electric drills, nail guns, saber saws and pneumatic drills). Several of the machines, moreover, required the installation of beams beneath the floor to support their weight and dedicated electric wiring to provide the necessary power for their operation.

Kaiser’s appraiser arrived at a final “sound value”—the cost of reproduction less depreciation—of about $577,000. The City’s appraiser, meanwhile, disputed that many of these claimed items were trade fixtures, and determined that claimant was entitled to a sound value of $128,936.

At trial, the witnesses were Manfred Kaiser and an appraiser for each side. Kaiser testified that because the premises were small, several machines were physically placed in an order that would maximize efficiency and mirror the flow of work. He conceded, however, that the items of equipment could each operate independently, no machine dependent on another. All of the apparatus could be moved to another location with similar electric or pneumatic power sources and used in a different manufacturing business. He further acknowledged that most of the equipment was of standard design, not built especially for him or according to any particular specifications. He also stated that while several items had been put on wheels or casters, if they were removed that would not alter the way the items functioned; additionally, some items were bolted to the floor, but only to steady them.

Claimant’s appraiser testified that many of the items were classified as fixtures in part because they were used in Kaiser’s business, even though they could be used in another woodworking shop or other business. In his view removal would cause a substantial loss in value in the secondhand market, and there would be additional costs to have the machinery removed, shipped and stored until it was sold. The City’s appraiser, meanwhile, testified that these were items of standard design that could function with the same utility in another business, could be relocated without damage or loss of utility, were bought and sold through new and used commercial markets, were usable in a number of different environments, and therefore were not compensable trade fixtures.

Supreme Court determined that these claimed items were compensable trade fixtures and awarded $525,000 to Kaiser, almost the entire amount sought. The court stated that the “test to be used in evaluating a claim is the economic test of loss in value . . . [which] bridges the gap of annexation and removability alike and solves the problem of intention of permanence,” and concluded that “[a]ll improvements which are erected for the purpose of trade or manufacture and can be removed without injury to the premises, for purposes of this case are compensable as trade fixtures” (Sup Ct, Bronx County, July 11, 2005, Silver, J, index No. 2667/98, op at 2-3).

On appeal, the City challenged the court’s conclusion, urging that some of the items were noncompensable personalty and that others were part of the underlying realty. The Appellate Division modified Supreme Court’s order, excluding a few additional items from the list of trade fixtures, and otherwise affirmed. First, the court excluded several items as part of the realty. Second, the court identified several handheld tools of standard design that, although of industrial quality, retained the characteristic of personalty “despite their integral role in Kaiser’s operation [since] [t]hey were not annexed to the property, the property was not adapted particularly to them, and there was no quality of permanence about their presence” (39 AD3d 131, 135 [2007]). Third, the court concluded that while Supreme Court correctly treated certain aspects of the electrical system as trade fixtures, the building’s basic electrical wiring cannot properly be classified as a trade fixture. None of the items excluded by the Appellate Division are before us on this appeal.

In the view of the Appellate Division, however, all other items were compensable trade fixtures:

“Contrary to the City’s contention, these claimed items of machinery satisfied the ‘annexation, adaptability and permanence’ test. They were an integral part of Kaiser’s woodworking business, and most of the machines were large, with dedicated electrical lines that had to be installed by an electrician. The premises being small, the machines were arranged in a particular order to mirror the flow of work for maximum efficiency. Kaiser’s expert also testified that these machines would suffer a substantial depreciation in value if removed. The evidence further showed that racks, installed by Kaiser in key places along the flow of work to hold clamps and other items needed during the production process, would have minimal value if removed. Dust collectors were also installed to accommodate numerous machines in the production process and were ancillary to them.” {Id. at 134-135.)

The Appellate Division remitted the matter to Supreme Court to modify its $525,000 award (subsequently fixed at $506,791). Significantly, the Appellate Division also granted the City’s motion for leave to appeal to this Court, certifying the following question of law: “Was the order of the Supreme Court, as modified by the decision and order of this Court, properly made?” We answer that question in the negative.

Analysis

When the State takes property by eminent domain, the Constitution requires that it compensate the owner “so that he may be put in the same relative position, insofar as this is possible, as if the taking had not occurred” (City of Buffalo v Clement Co., 28 NY2d 241, 258 [1971]). Thus, “[a]n appropriation of land . . . is an appropriation of all that is annexed to the land, whether classified as buildings or as fixtures .... The value of the fixtures ought, therefore, to [be] considered in estimating the total value of the property appropriated by the State” (Jackson v State of New York, 213 NY 34, 36 [1914]).

These principles are easier stated than applied to the law of fixtures, which developed in the context of land sales, not eminent domain. The difficulty is apparent in the case of business machinery, which—though large, heavy and specific to a trade—often is removable and useful in another location. Removability, however, is not determinative in separating compensable fixtures from noncompensable personalty.

New York’s earliest cases on trade fixtures (as they are called) address the rights of buyers and sellers, or heirs and donees, of real property. The plaintiff, usually the seller, typically brought suit to retain title to machinery after a contract of sale for real property had been executed. The court’s task was to determine whether the machinery was so affixed that it became part of the realty and passed to the buyer by execution of the contract of sale (see e.g. Potter v Cromwell, 40 NY 287 [1869]). For an item to be deemed a fixture, it had to satisfy a three-pronged test: actual annexation to the realty, adaptability to the use or purpose of the realty and the intention that the annexation be permanent (id.).

In the century and a half this Court has grappled with fixtures issues, the three-pronged “annexation-adaptability-permanency” test has remained central—in this and most other states—to determining whether an item is a compensable trade fixture or noncompensable personalty. Under the first prong, annexation originally required that the chattel be physically attached to the realty, but that concept has been enlarged to include items that are “constructively annexed” to the land. Adaptability, meanwhile, contemplates both fitting the chattel to the particular purpose of the freehold, and the necessity of the chattel for complete use of the freehold, as when machinery is placed in a factory to perform a special purpose and is fitted for that purpose. The final element is an intention that attachment be permanent, requiring an objective interpretation of the installer’s intention at the time of attachment. Even if the machinery could be removed, the critical factor was whether its installation was intended to be permanent (see McRea v Central Natl. Bank of Troy, 66 NY 489, 494 [1876]).

In Jackson v State of New York (213 NY 34 [1914, Cardozo, J.]), this Court first applied the law of fixtures to eminent domain, recognizing that certain economic factors—unique to a functioning business—must be considered as an enhancement factor when valuing condemned property. In Jackson, claimant’s property had been used as a grain and bean warehouse that housed equipment and machinery used for business purposes. The Appellate Division determined that although most, if not all, of the items would be deemed fixtures as between vendor and vendee, that conclusion was inapposite in the context of eminent domain because the State—unlike a vendee—had no use for the attached machinery. This Court rejected that distinction, concluding that condemnation is a forced sale that places the State and the claimant in the position of vendee and vendor and “[o]n that basis [their] rights and duties . . . must be determined” {id. at 35) .

The Court revisited the subject in Matter of City of New York (430 E. 59th St. Corp.) (278 NY 276 [1938]), where a lessee maintained a silk ribbon manufacturing factory on property that was the subject of an eminent domain proceeding. The lessee sought compensation for machinery—including looms, harnesses and loose parts used in connection with the looms— utilized to run its business. The spare parts were standard articles purchased from dealers and the harnesses were interchangeable on the looms. The looms were attached to the floor by screws and bolts, but only to keep them from vibrating and shifting. The issue was whether the machinery constituted compensable trade fixtures, and in reaching that determination the Court further crafted the law of trade fixtures as it applies to machinery:

“Machinery normally is personal property and is not deemed a fixture except where it is installed in such manner that its removal will result in material injury to it or the realty, or where the building in which it is placed was specially designed to house it, or where there is other evidence that its installation was of a permanent nature.” {Id. at 281-282.)

Because there was no evidence that the looms were installed permanently, the Court declined to treat them as fixtures.

In its last major foray into the area of trade fixtures—Rose v State of New York (24 NY2d 80, 86 [1969]), a case primarily concerned with valuation rather than classification of fixtures— this Court recognized that “New York takes a broad view in evaluating what improvements are to be regarded as [trade] fixtures.” After citing the above-quoted passage from City of New York, this Court for the first time added a fourth element to the trade fixtures test: “those improvements which are used for business purposes and which would lose substantial value if removed” (id,.). It is this “lose substantial value” element that is the focus of the present appeal.

Kaiser argues that certain of its large machinery would lose substantial value both because it would sell for less on a secondhand market and because it was part of an integrated workplace physically ordered to maximize efficiency and mirror the flow of labor. Both arguments were embraced by the courts below in articulating the applicable test. This, however, misconstrues what the Court in Rose meant by “lose substantial value if removed.”

Several decisions are illustrative of the meaning of the phrase. A substantial loss in value would occur, for example, where machinery was specially constructed for the plant, or the building was so designed that the subject items were functionally dependent on other items or on the building (Matter of New York City Tr. Auth. [Superior Reed & Rattan Furniture Co.], 160 AD2d 705, 706 [2d Dept 1990]). Another example would be equipment that functions as part of a truly integrated operation, such that the removal of one item diminishes the utility of remaining items (Matter of City of New York [Fassler], 27 AD2d 810, 811 [1st Dept 1967]). Thus, in determining the compensability of items in a commercial television production studio, one court concluded that “where installed equipment functions in dependence on other installed equipment at the site, so that there is no ‘realistic market’ for the item once detached from the condemned property[,] compensation is warranted” (In re 42nd St. Dev. Project v Hispanic Am. Tel. Cos., Inc., Sup Ct, NY County, Dec. 27, 1994, Parness, J., index No. 44507/91, op at 5).

In contrast, laundromat equipment was not considered part of an integrated plant simply because the machines could be used together (In re City of N.Y. [East 99th St.], NYLJ, Aug. 2, 1973, at 11, cols 2, 4-5 [Sup Ct, NY County, Waltemade, J.]):

“The removal of any one machine, while temporarily interrupting or curtailing production, does not close down the whole operation. Normal production resumes upon the installation of a replacement, used or new machine, which is manufactured to perform the same function, all of which are readily available in the machinery market. . .
“The ‘umbrella like’ approach!—]classifying every piece of equipment in the plant as a trade fixture and hence compensable—is to be rejected . . . Every prudent, sophisticated and successful entrepreneur seeks to integrate or coordinate the operations of an industrial or service venture because it is more economical, more efficient and more productive. ‘Integrated’, in a business sense, merely means that the different phases of the work being done are organized in an orderly fashion to unify and expedite the functional performance ... To characterize everything in a well-organized industrial plant as a trade fixture is a pitfall to be avoided.”

Kaiser’s appraisal lists virtually every item in its woodshop, even the “kitchen sink”—all indisputably used in connection with the business. But use in connection with a business is not the test of compensability in New York; nor is efficiency of operation. The common thread of items qualifying under the “substantial loss” category of compensable fixtures is devaluation of functional utility if the item is removed.

Here, there is no claim of special design. What is in issue is standard woodshop equipment. Claimant argued that, because of the small size of his shop, he physically placed his machines in such an order as to maximize efficiency. The Appellate Division agreed that the items were an integral part of the woodworking business because they were large, with dedicated electrical lines, and arranged “to mirror the flow of work for maximum efficiency” (39 AD3d 131, 134-135 [2007]). We disagree. The fact that equipment is placed in a certain order to maximize efficiency does not define an integrated operation for purposes of determining a loss of substantial value.

Claimant’s remaining argument—unchallenged by the City—is that many of the listed items will lose value because they are worth less as secondhand goods than they are in his shop, and there are additional costs incurred to have the machinery removed, shipped and stored. The existence of these costs, similarly, does not qualify as losing substantial value. Claimant mistakes diminution in use with loss in value merely because each piece of equipment may be worth less used. Under such analysis, virtually every machine used in a business would be a compensable fixture, obliterating the distinction between fixtures and personalty.

A fair reading of the decisions below shows that the courts correctly identified the “annexation-adaptability-permanence” test along with the “lose substantial value” factor articulated in Rose. As we have explained, however, reliance on the secondhand value of individual items in this nonintegrated woodshop was error, and we cannot say whether in this case the items otherwise meet the test for trade fixtures.

Accordingly, the order of the Appellate Division should be reversed, with costs, the case remitted to Supreme Court for further proceedings in accordance with this opinion, and the certified question answered in the negative.

Judges Ciparick, Graffeo, Read, Smith, Pigott and Jones concur.

Order reversed, etc.

      . Claimant’s list included additional items that Supreme Court determined were noncompensable—an exterior fire escape; AT & T cordless telephone; wall-mounted electrical retractable reel, and wall-mounted lamp; ceiling fan; toilet facility structure and amenities; fire extinguisher, sawhorses; wadi brackets, sand buckets, shelving unit; spray paint units, air hoses, metal cabinet; shelf, power strip, hand tool mounting strips, mounting board, small parts bin; shelving rack; disconnect switch; photocopier; sink, refrigerator, coffeemaker, microwave oven and hot plate. These items are not in issue before us.

      . The City’s brief cites this figure as $564,270.

      . The City asserted that the following items were noncompensable personalty: belt sanders; numerous table saws with different attachments; a canvas bag in a dust collection unit; planers; a splitter machine; handheld power tools, such as drills, nail guns, saws and various routers (claimant characterized some of the drills and nail guns as pneumatic operated by air pressure); drill presses; a band saw; various racks with small tools and supplies, including blades, planer knives and router blades; a 40-gallon barrel-type dust collector; an edge bender/sander (claimant characterized it as an edge bender/brake); a table-mounted router; a portable transfer cart (characterized by claimant as a “panel handling lift unit”); a belt sander console unit; a 51-inch roller unit (claimant described it as pneumatic); a table-mounted punch press with a steel table; a wood lathe and set of chisels; a router with a steel table; a shaper with a steel table (claimant characterized it as a small router with table); a small storage safe; a pedestal-mounted tool grinder; and a wall-mounted telephone.

      . The City asserted that the following merged with the realty: plywood, concrete block and mortar used as security closures for six former windows; a custom-built front door; and electrical wiring.

      . These items include concrete blocks, plywood and sheet metal used to close what had been window openings in the building.

      . These included severed electric drills, pneumatic nail guns, saber saws, pneumatic drills and routers.

      . This test was actually first articulated by the Ohio Supreme Court in the oft-cited case Teaff v Hewitt, which declared:
      “[T]he united application of the following requisites will be found the safest criterion of a fixture.
      “1st. Actual annexation to the realty, or something appurtenant thereto.
      “2d. Appropriation to the use or purpose of that part of the realty with which it is connected.
      “3d. The intention of the party making the annexation, to make the article a permanent accession to the freehold—this intention being inferred from the nature of the article affixed, the relation and situation of the party making the annexation, the structure and mode of annexation, and the purpose or use for which the annexation has been made” (1 Ohio St 511, 529-530 [1853]).

      . As Judge Cardozo later noted in New York, Ontario & W. Ry. Co. v Livingston (238 NY 300, 305-306 [1924]), a just result also takes into account the interest of the public, which is to pay for the property taken.

      . Other state courts have drawn on Jackson in developing their own trade fixtures test in eminent domain proceedings. The New Jersey Supreme Court, for example, cited Jackson in adopting a “functional unit” test to determine whether removable machinery is compensable in eminent domain proceedings, holding that where “a building and industrial machinery housed therein constitute a functional unit, and the difference between the value of the building with such articles and without them[ ] is substantial, compensation for the taking should reflect that enhanced value” (State by State Hwy. Commr. v Gallant, 42 NJ 583, 590, 202 A2d 401, 405 [1964]).


author: Per Curiam.

text:
    [899 NE2d 925, 870 NYS2d 819]
    In the Matter of David F. Jung, a Judge of the Family Court, Fulton County, Petitioner. State Commission on Judicial Conduct, Respondent.
    Argued September 9, 2008;
    decided October 28, 2008

      POINTS OF COUNSEL

      Capasso & Massaroni, Schenectady (Vincent Capasso, Jr., of counsel), for petitioner.
    I. This Court exercises plenary and de novo review of the State Commission on Judicial Conduct’s determination. (Matter of Quinn v State Commn. on Jud. Conduct, 54 NY2d 386.) II. The State Commission on Judicial Conduct erred in determining that petitioner violated any of the Rules Governing Judicial Conduct. (People ex rel. Constantino v Lorey, 28 AD3d 1041; People v Parker, 57 NY2d 136; Matter of Mosso v Mosso, 6 AD3d 827; Matter of Kendra M., 175 AD2d 657; People ex rel. Foote v Lorey, 28 AD3d 917; Matter of Bauer, 3 NY3d 158.) III. It is clear that Judge Jung abided by the law and rules with regard to Family Court.

      Edward Lindner, New York City, Robert H. Tembeckjian and Cathleen S. Cenci for respondent.
    Petitioner should be removed from office for his repeated violation of the fundamental rights of litigants. (Matter of Rodriguez v Feinberg, 40 NY2d 994; Matter of Mosso v Mosso, 6 AD3d 827; People ex rel. Lobenthal v Koehler, 129 AD2d 28; Matter of DeMarco v Raftery, 242 AD2d 625; Matter of Lewis v Crosson, 53 AD2d 1029; Matter of McNeill v Ressel, 258 AD2d 64; Matter of Radjpaul v Patton, 145 AD2d 494; Matter of Sales v Gisendaner, 272 AD2d 997; Matter of Hohenforst v DeMagistris, 44 AD3d 1114; Matter of Tristram K., 25 AD3d 222.)

      Law Offices of Schur & Casale, PLLC, Mayfield (Anthony Casale of counsel), for Fulton County Bar Association, amicus curiae.
    I. The conduct of Judge Jung, a jurist with a previously unblemished record, warrants a disposition less severe than removal. (Matter of Lonschein, 50 NY2d 569; Matter of Quinn v State Commn. on Jud. Conduct, 54 NY2d 386; Matter of Cunningham, 57 NY2d 270; Matter of Esworthy, 77 NY2d 280; Matter of Cohen [State Commn. on Jud. Conduct], 74 NY2d 272; Matter of Kiley, 74 NY2d 364.) II. Sanction of removal would deprive Fulton County of a competent and experienced judge.
   OPINION OF THE COURT

Per Curiam.

Petitioner, a Judge of the Family Court, Fulton County, commenced this proceeding to review a determination of the State Commission on Judicial Conduct that sustained five charges of misconduct against him and imposed the sanction of removal from judicial office. Upon our plenary review of the record, we accept the determined sanction.

After serving as a law guardian for more than a decade, in 1989 petitioner was elected to the Fulton County Family Court and in 1992 he was appointed to serve as an Acting Supreme Court Justice. In 2005, petitioner presided over a series of Family Court cases that form the basis of the Commission’s findings. By formal complaint dated December 6, 2006, the Commission served him with five charges. Charges I, II and III alleged violations of litigants’ right to be heard and of sections 100.1, 100.2 (A) and 100.3 (B) (1) and (6) of the Rules Governing Judicial Conduct (22 NYCRR). Charges I, IV and V alleged violations of litigants’ right to counsel and violations of the same sections.

On April 19, 2007, petitioner, his counsel and Commission counsel entered into a stipulation of facts. A hearing was held on April 26, 2007, and the Referee accepted the stipulation into evidence. Petitioner testified, called two witnesses to testify on his behalf, and submitted additional affidavits attesting to his character. On September 7, 2007, the Referee sustained all five charges based on petitioner’s violation of litigants’ rights when he entered defaults and sentenced them, in absentia, to jail. The Commission unanimously sustained all charges, concluding that petitioner violated the cited sections of the Rules Governing Judicial Conduct, and imposed the sanction of removal, noting that as a consequence of petitioner’s disregard of fundamental rights, five litigants were sentenced to significant terms of incarceration and at least three served several months in jail on the unlawful sentences he imposed.

I. Factual Findings

DeMagistris

Charge I alleged that while presiding over the case of Matter of Wendy Lynn Hohenforst v Thomas DeMagistris, petitioner violated the defendant’s due process rights, including the right to be heard and the right to counsel, when he summarily held DeMagistris in default on two family offense petitions and sentenced him in absentia to two consecutive 180-day terms of incarceration notwithstanding that defendant was being held in a courthouse holding cell throughout the proceeding.

Outside of the courtroom prior to a family offense proceeding before petitioner, DeMagistris verbally assaulted counsel for his children’s mother, Hohenforst, and was placed in a Family Court holding cell. Petitioner thereafter convened a proceeding in the courtroom and placed on the record a description of the incident, stating that DeMagistris was not in the courtroom because he had been placed under arrest for “criminal behavior” and had thus waived his right to appear. Subsequently, petitioner dismissed counsel for both parties upon their own motions without inquiry as to whether DeMagistris had notice of his counsel’s request. Upon excusing counsel for the mother, petitioner asked if she wanted an adjournment, which she declined. Following an inquest, petitioner granted the relief she requested, including divesting DeMagistris of custody of his children, dismissed defendant’s cross motion for failure to prosecute, and sentenced defendant to a year of incarceration. Petitioner directed that DeMagistris be served with the orders if he was still in the holding cell.

DeMagistris was released by Supreme Court’s grant of a writ of habeas corpus (see Matter of Hohenforst v DeMagistris, 44 AD3d 1114 [3d Dept 2007]).

Constantino

Charge II alleged that in Matter of Fulton County Department of Social Services v Angelic Constantino, petitioner violated Constantino’s due process rights when he failed to order her produced in court although he knew she was incarcerated in a correctional facility outside the county, summarily found her in default, sentenced her in absentia to six months’ incarceration, and revoked her custodial rights.

At the time, petitioner’s long-standing policy was that “incarcerated litigants had to request of the court to be produced by the court.” After unsuccessful attempts to contact petitioner’s court, Constantino, incarcerated in another county, failed to appear for an April 11, 2005 hearing before petitioner on a custody petition and an allegation that she had violated an order of protection. Although petitioner knew that the Fulton County Department of Social Services had served Ms. Constantino with the petition in Schenectady County jail, and acknowledged having been told by counsel for the father’s parents that Constantino was in jail, petitioner denied that he had actual knowledge that she was in jail, as he considered counsel’s statement hearsay. He later maintained that if Constantino “has a normal IQ and she didn’t know to ask [for an order to produce] . . . it’s her responsibility to find out.” He stated, further, that although the summons did not alert her to his policy, she was obligated to find out by “word of mouth.” On April 12, 2005, Constantino called the court from jail and asked why she had not been produced. Court staff informed her of petitioner’s policy and advised her to put her concerns in writing, which she did with the assistance of attorney in a letter dated April 15, 2005. Her attorney was told that as “no request was received from Angelic Constantino and the court was in receipt of an affidavit of service,” the matter had proceeded upon default.

Constantino was released by Supreme Court’s grant of a writ of habeas corpus, affirmed by the Appellate Division (see People ex rel. Constantino v Lorey, 28 AD3d 1041 [3d Dept 2006]).

DaCorsi

Charge III alleged that in Matter of Julie A. Dacre v Dennis A. DaCorsi, Jr., petitioner violated DaCorsi’s due process rights when, knowing that DaCorsi was incarcerated and unable to appear, he found him in default and sentenced him to nine months in jail.

DaCorsi was due to appear before petitioner on a custody petition on April 28, 2005. According to petitioner’s docket sheet, DaCorsi’s sister called on April 27, 2005 and informed the court that her brother had been arrested but was due to appear in Family Court the following day. A clerk told her that either the sheriff or DaCorsi himself would have to contact the court and ask that he be produced. Petitioner was informed (although the actual date is in dispute) that someone claiming to be DaCorsi’s sister had called, but testified that he had “no idea if it was his sister” and if it was that she “could have gone over to the jail with a piece of paper to sign and she could have delivered it to the court and I would have produced him.” Petitioner explained that, in any event, he did not consider the sister’s call a request to produce.

Petitioner held DaCorsi in default, and after an inquest Da-Corsi lost custody of his children and was sentenced in absentia to consecutive terms of 90 days’ and 180 days’ incarceration. On June 16, 2006, petitioner granted DaCorsi’s motion to vacate the default judgment and for petitioner’s disqualification.

Smith

Charge IV maintained that in Matter of Dale A. Rulison v Nickie L. Smith, petitioner violated Smith’s right to counsel when he denied her request for assigned counsel as late, summarily affirmed a magistrate’s order that found her in default when she failed to appear for a hearing on a child support matter, and sentenced her to 90 days in jail.

It was petitioner’s policy that a litigant seeking assigned counsel in a family offense proceeding had to apply for a public defender within two weeks of initial appearance, regardless of the date of the hearing. On January 12, 2005, Smith appeared before a support magistrate to answer charges that she had violated an order of support. She requested counsel and was given an application for the public defender, and the matter was adjourned until April 27, 2005. On February 8, 2005, Smith submitted an application for representation by a public defender in the child support matter. Petitioner said the application was late and on February 14, 2005 denied it as untimely. On February 14, 2005, Smith also submitted an application for representation in a custody and visitation matter. Petitioner approved that application on February 18, 2005.

On April 27, 2005, Smith failed to appear for the support hearing and the magistrate declared her in default and recommended that she be held in contempt. On May 18, 2005, Smith appeared before petitioner for a confirmation proceeding. Petitioner later explained that the confirmation hearing was “merely [for the judge] to approve what the support magistrate did. ... Or the judge may, and I emphasize may, conduct an evidentiary hearing, which is not what we were doing in this case.” When Smith attempted to defend herself against the petition, petitioner said “I didn’t see any objections filed here,” confirmed the magistrate’s determination and sentenced Smith to jail. Smith said she had sought representation from the public defender and never heard anything; petitioner responded “you’ll have to take it up with the Public Defender’s Office.” Petitioner testified that he did not see, upon reviewing her file, that Smith had been assigned counsel on the custody matter and that he did not attempt to find out if any court attorneys were present at the courthouse that day.

Smith did not appeal or move to vacate petitioner’s decision, and was released from jail after paying a “purge.”

Foote

Charge V alleged that in Matter of Timothy Foote v Karrie Foote, petitioner violated Karrie Foote’s due process rights when, despite evidence that she was learning-disabled and unable to read, he denied her the right to counsel, summarily affirmed the magistrate’s finding of default and sentenced her to 180 days in jail.

Foote appeared before a support magistrate on January 20, 2005, on charges of contempt of court for willful violation of an order of support. She told the magistrate that she could not read and did not have a lawyer. The magistrate told her she could apply for a public defender and adjourned the matter until May 11, 2005. Foote obtained an application but never filed it. On April 4, 2005, she appeared before petitioner on a custody modification petition. Petitioner advised Foote of her right to an attorney and instructed her to fill out an application. The parties met with a court mediator, resolved their custody dispute and returned to petitioner’s courtroom for confirmation.

Foote believed that this custody settlement resolved the support matter, and failed to appear before the support magistrate on May 11, 2005. The magistrate declared her in default and recommended that she be held in contempt. On May 25, 2005, Foote appeared, without counsel, at a confirmation proceeding in front of petitioner, and told petitioner she had requested a lawyer. Petitioner responded that it was “too late,” later explaining that he meant it was “a double too late” “too late . . . with me and too late . . . with the magistrate.”

Petitioner maintained that he could not have sent the Foote matter back to the support magistrate or taken steps to obtain counsel for her because he would have violated a uniform rule providing that a litigant is entitled to only one adjournment absent good cause, and he did not find good cause. He confirmed the decision and told Foote he was going to incarcerate her. Foote’s mother addressed the court, explaining that Foote couldn’t read and that she herself had not had time to read the papers or explain them to her daughter. She stated:

“I told Karrie that she needs to ask for a lawyer. She needs to be represented by a lawyer. I don’t understand how these procedures can go on without her having some kind of representation. Especially when she doesn’t even read. . . .
“She [h]as a fourth grade reading level.”

Petitioner responded:

“[Y]ou’re telling me that. That doesn’t make it a fact. But if we had some medical proof that that was so, if she had told somebody that, I, I’m not the Magistrate, so I didn’t hear the case.”

Petitioner signed an order committing Foote to the Fulton County jail. He later acknowledged that Foote herself told the support magistrate she could not read and that he had “noted that” in his review of the record. He also recalled her mother saying “that she had the ability of a fourth grade reader, which is pretty good ability.”

Foote was released by Supreme Court’s grant of a writ of habeas corpus nearly two months later. The Appellate Division affirmed (see People ex rel. Foote v Lorey, 28 AD3d 917 [3d Dept 2006]).

After the Appellate Division’s Foote decision, petitioner issued a press release defending his policies and expressing “disappointment” at the determination. Petitioner additionally stated:

“Henceforth, in an effort to further streamline and simplify procedures, since the statute does not specifically require the Court to mandate court appearances of parties so that confirmation of the Support Magistrate’s decision can be made in person, the Court will simply issue a written confirmation unless the Court finds that the Support Magistrate erred in some fashion. . . .
“If, at some point, the Appellate Division ... reconsiders this issue and reverses itself as it has done in the past, or ... if the Court of Appeals rules in favor of our prior policy and procedure, we can and will reinstate same.”

During the Commission’s investigation, petitioner testified that he wouldn’t have handled any of the cases any differently.

II. Analysis

At issue here is petitioner’s denial of due process to litigants in family offense—specifically custody and support—proceedings. DeMagistris, Constantino and DaCorsi involved denial of the right to be heard; DeMagistris, Smith and Foote the right to counsel.

The right to be heard is fundamental to our system of justice (see Mullane v Central Hanover Bank & Trust Co., 339 US 306, 314 [1950]; Matter of Jones v Berman, 37 NY2d 42, 55 [1975]). Parents have an equally fundamental interest in the liberty, care and control of their children (see Stanley v Illinois, 405 US 645, 651 [1972]; Matter of Ella B., 30 NY2d 352, 356 [1972]). The right to be heard, therefore, necessarily attaches to family offense proceedings, regardless of a party’s status as incarcerated or otherwise detained pursuant to state authority (see Matter of Tristram K., 25 AD3d 222, 226 [1st Dept 2005] [“even an incarcerated parent has a right to be heard on matters concerning her child, where there is neither a willful refusal to appear nor a waiver of appearance”]). This right is no less vital to a proceeding for summary contempt (see Matter of Katz v Murtagh, 28 NY2d 234, 238 [1971] [a person subject to incarceration for contempt is entitled to an opportunity to appear and “to offer any reason in law or fact why that judgment should not be pronounced”]; see Matter of Mosso v Mosso, 6 AD3d 827, 829 [3d Dept 2004] [“due process requires that . . . the contemnor be afforded ‘an opportunity to be heard at a meaningful time and in a meaningful manner’ ”]; see also Family Ct Act § 454 [1], [3] [providing for incarceration “after hearing” on a willful violation of an order of support]).

Integral to this fundamental interest in the liberty, care and control of their children, and coextensive with the right to be heard in a meaningful manner, is a parent’s right to representation of counsel in family offense proceedings. “[A]n indigent parent, faced with the loss of a child’s society, as well as the possibility of criminal charges, ... is entitled to the assistance of counsel” (Ella B., 30 NY2d at 356 [codified in 1975 and extended to provide litigants with the right to counsel in custody, family offense and contempt proceedings (see Family Ct Act §§ 261, 262 [a] [v], [vi])]). The right to counsel includes the right to notice prior to a court-ordered withdrawal from representation (CPLR 321 [b] [2]; Matter of Kindra B., 296 AD2d 456, 458 [2d Dept 2002]). Waiver of this right must be “unequivocal, voluntary and intelligent”; a court is obligated to make a “searching inquiry” to ensure that it is (see People v Smith, 92 NY2d 516, 520 [1998]).

At most, petitioner would now concede that his denial of these rights to litigants amounted to legal error and not misconduct. As we have previously explained, the two are not necessarily mutually exclusive; a pattern of fundamental legal error may be “serious misconduct” (Matter of Reeves, 63 NY2d 105, 109 [1984]; see Matter of Sardino v State Commn. on Jud. Conduct, 58 NY2d 286, 289 [1983]; see Matter of McGee v State Commn. on Jud. Conduct, 59 NY2d 870, 871 [1983]). Moreover, the Court agrees with the Commission that in denying litigants these rights, petitioner also violated the Rules Governing Judicial Conduct.

Although judicial disciplinary proceedings are not punishment (Matter of Esworthy, 77 NY2d 280, 283 [1991]), the severe sanction of removal is warranted where a jurist has exhibited a “pattern of injudicious behavior . . . which cannot be viewed as acceptable conduct by one holding judicial office” (Matter of VonderHeide [State Commn. on Jud. Conduct], 72 NY2d 658, 660 [1988]) or an abuse of “the power of his office in a manner that. . . has irredeemably damaged public confidence in the integrity of his court” (Matter of McGee v State Commn. on Jud. Conduct, 59 NY2d 870, 871 [1983]). Such behavior is especially “intolerable” in Family Court, “where matters of the utmost sensitivity are often litigated by those who are unrepresented and unaware of their rights” (Matter of Esworthy, 77 NY2d at 283). Removal is thus appropriate when a Family Court judge exhibits conduct “which necessarily has the effect of leaving litigants with the impression that our judicial system is unfair and unjust” (id. [among other misconduct, “(i)n case after case” judge “neglected to inform litigants appearing before him of their constitutional and statutory rights, including their right to counsel” (id. at 282)]).

Here, in four out of five cases, the due process violations at issue resulted from two policies that petitioner effectuated in his courtroom for many years. Two of the violations of the right to be heard stemmed from petitioner’s policy that an incarcerated litigant would not be produced for a proceeding unless he or she specifically asked to be produced. This unwritten rule, neither printed on a summons nor communicated to any facility, imposed an onerous and unfair burden on litigants who had no way of knowing what was required of them. Litigants who had previously been incarcerated and produced for matters before other judges were even more disadvantaged by petitioner’s anomalous policy. Instead of taking steps to ease their burden, petitioner, in Constantino and DaCorsi, actually increased it by refusing, under the guise of not having “actual notice” of each litigant’s incarceration, to acknowledge attempts to contact the court by family members and litigants themselves. Petitioner’s view, however, was that even his own knowledge of a litigant’s incarceration would not have excused failure to comply with the strictures he imposed. As the Commission concluded, such a policy impermissibly “elevated form over substance where liberty and parental rights hung in the balance.”

Petitioner’s institution of this long-standing policy resulted in gross and repeated deprivation of the fundamental right to be heard, and had grave consequences for litigants. This policy, along with petitioner’s unwavering imposition of a two-week time limit on requests for counsel, evidences a “pattern of injudicious behavior” that this Court cannot sustain (see Matter of VonderHeide, 72 NY2d at 660). Also significant is petitioner’s response to the Appellate Division’s two grants of writs of habeas corpus in Constantino and Foote (see People ex rel. Constantino v Lorey, 28 AD3d 1041 [3d Dept 2006]; People ex rel. Foote v Lorey, 28 AD3d 917 [3d Dept 2006]; Matter of Hohenforst v DeMagistris, 44 AD3d 1114 [3d Dept 2007]). After these reversals, petitioner chose to modify his first policy by increasing notifications, yet continuing to place the burden of production in court on incarcerated litigants. With regard to his second policy, he publicly stated his intent to discontinue confirmation hearings—the proceeding where Smith and Foote invoked their right to counsel—and issue written confirmations instead (see press release of April 26, 2007).

Plainly, even the Appellate Division precedents failed to impress the importance of these due process rights upon petitioner in any meaningful way. As in Matter of Reeves, these “errors were fundamental and the pattern of repeating them, coupled with an unwillingness to recognize their impropriety, indicate that petitioner poses a threat to the proper administration of justice” (63 NY2d at 110-111).

It is apparent from the record as a whole that petitioner continues to believe that his actions were a permissible exercise of the “wide discretion” given Family Court judges “for dealing with the complexities of family life” (Family Ct Act § 141). He fails to grasp that with such discretion comes grave responsibilities to the litigants before him as well as to their children. While we recognize that petitioner has well served youth in his court and through his extensive involvement in community service, part and parcel of effecting the “best interests” of a child is affording that child’s parent the rights inherent in the parental bond. We acknowledge that removal from office is an “extreme sanction” that is imposed only “in the event of truly egregious circumstances” (Matter of Cunningham, 57 NY2d 270, 275 [1982]). We conclude that petitioner’s steadfast adherence to long-standing policies that have seriously compromised the due process rights of litigants justifies removal.

Accordingly, the determined sanction should be accepted, without costs, and David F. Jung removed from the office of Judge of the Family Court, Fulton County.

Chief Judge Kaye and Judges Ciparick, Graffeo, Read, Smith, Pigott and Jones concur in per curiam opinion. Determined sanction accepted, etc.

       Charges IV and V also alleged violations of section 100.3 (B) (3) of the Rules Governing Judicial Conduct.


author: Smith, J.

text:
    [899 NE2d 947, 870 NYS2d 841]
    Briggs Avenue LLC, Appellant, v Insurance Corporation of Hannover, Respondent.
    Argued October 14, 2008;
    decided November 20, 2008

      POINTS OF COUNSEL

      Scher & Scher, P.C., Great Neck (Robert A. Scher and Daniel J. Scher of counsel), for appellant.
    I. This Court ought not to extend the purpose of Limited Liability Company Law § 301 beyond that for which it was enacted. (Agoado Realty Corp. v United Intl. Ins. Co., 95 NY2d 141.) II. Oversights such as that of Briggs Avenue LLC should not prejudice the rights of either the insured or the injured parties, where the parties have proceeded diligently upon discovering the facts. III. This Court should interpret the policy provision in appellant’s favor and hold that service upon the Secretary of State without actual delivery to appellant did not trigger the requirement to give notice of the suit under the policy issued by Insurance Corporation of Hannover. (105 St. Assoc. LLC v Greenwich Ins. Co., 507 F Supp 2d 377; 26 Warren Corp. v Aetna Cas. & Sur. Co., 253 AD2d 375.) IV. It was not reasonably possible to give notice of the lawsuit within any prescribed time although it was given as soon as was reasonably possible. V. As a matter of law, respondent waived any claim that notice of the occurrence was late. (General Acc. Ins. Group v Cirucci, 46 NY2d 862.) VI. Respondent’s disclaimer was based solely on late notice of suit. (Fabian v Motor Veh. Acc. Indem. Corp., 111 AD2d 366; Matter of State Farm Mut. Auto. Ins. Co. v Cooper, 303 AD2d 414; Matter of State Farm Mut. Auto. Ins. Co. v Joseph, 287 AD2d 724; John v Centennial Ins. Co., 91 AD2d 1104; Matter of Eveready Ins. Co. v Dabach, 176 AD2d 879; Hazen v Otsego Mut. Fire Ins. Co., 286 AD2d 708; Vanegas v Nationwide Mut. Fire Ins. Co., 282 AD2d 671; United States Liab. Ins. Co. v Young, 186 AD2d 644.) VII. If appellant was required to give notice of the occurrence, respondent has waived compliance with the policy provision requiring such notice. (General Acc. Ins. Group v Cirucci, 46 NY2d 862; Hurley v First UNUM Life Ins. Co., 24 AD3d 509;
      Vacca v State Farm Ins. Co., 15 AD3d 473; Fabian v Motor Veh. Acc. Indem. Corp., 111 AD2d 366.)

      White Fleischner & Fino, LLP, New York City (Nancy D. Lyness of counsel), for respondent.
    I. The instant Court should be persuaded by and accept the sound rationale of existing case law and the opinions of the District and Circuit Courts herein. (26 Warren Corp. v Aetna Cas. & Sur. Co., 253 AD2d 375; FGB Realty Advisors v Norm-Rick Realty Corp., 227 AD2d 439; Cedeno v Wimbledon Bldg. Corp., 207 AD2d 297; Associated Imports v Amiel Publ., 168 AD2d 354.) II. The new legislative bill eradicating New York’s long-standing no prejudice rule has no bearing upon this matter. III. Briggs Avenue LLC’s first three points are unpreserved for appellate review by this Court. (Bingham v New York City Tr. Auth., 99 NY2d 355; Matter of Salino v Cimino, 1 NY3d 166; Elezaj v Carlin Constr. Co., 89 NY2d 992; Cummins v County of Onondaga, 84 NY2d 322; Haynes v Haynes, 83 NY2d 954.) IV. New York Limited Liability Company Law § 301 actually confirms that notice to the New York Secretary of State’s office constitutes notice to the limited liability company. V. Briggs Avenue LLC’s reliance upon New York’s direct action statute is equally inapposite. (Wraight v Exchange Ins. Co., 234 AD2d 916; Jenkins v Burgos, 99 AD2d 217; Ringel v Blue Ridge Ins. Co., 293 AD2d 460.) VI. CPLR 317 and 318 also afford no basis for this Court to excuse the inexcusable. VII. Agoado Realty Corp. v United Intl. Ins. Co. (95 NY2d 141 [2000]) does not, as contended by Briggs Avenue LLC, suggest that notice to the Secretary of State does not, as a matter of law, constitute notice to defendant. VIII. Insurance Corporation of Hannover is a liability insurer, not a guarantor of Briggs Avenue LLC’s liability to third parties. IX. Insurance Corporation of Hannover has not waived any of its notice defenses.

      Melito & Adolfsen P.C., New York City (Ignatius John Melito, S. Dwight Stephens and David DePasquale of counsel), and Wiley Rein LLP, Washington DC (Laura A. Foggan and Benjamin J. Theisman of counsel), for Complex Insurance Claims Litigation Association, amicus curiae.
    I. An insurance policy, like any other contract, is applied according to its plain terms. (Graf v Hope Bldg. Corp., 254 NY 1; Matter of Davis v Block & Smith, Inc., 297 NY 20; Teichman v Community Hosp. of W. Suffolk, 87 NY2d 514; Consolidated Edison Co. of N.Y. v Allstate Ins. Co., 98 NY2d 208; Douglas v Knick. Life Ins. Co., 83 NY 492.) II. Timely notice is a fundamental condition precedent to insurance coverage. (Unigard Sec. Ins. Co. v North Riv. Ins. Co., 79 NY2d 576; Security Mut. Ins. Co. of N.Y. v Acker-Fitzsimons Corp., 31 NY2d 436; Argo Corp. v Greater N.Y. Mut. Ins. Co., 4 NY3d 332; AXA Mar. & Aviation Ins. [UK] Ltd. v Seajet Indus. Inc., 84 F3d 622; American Ins. Co. v Fairchild Indus., Inc., 56 F3d 435; Commercial Union Ins. Co. v International Flavors & Fragrances, Inc., 822 F2d 267; Sparks v Transamerica Ins. Co., 141 F3d 1179; Vucetovic v Epsom Downs, Inc., 10 NY3d 517; Morales v Gross, 230 AD2d 7.) III. New York courts generally do not forgive one’s inability to maintain a current address with the Secretary of State. (Security Mut. Ins. Co. of N.Y. v Acker-Fitzsimons Corp., 31 NY2d 436; Town House St., LLC v New Fellowship Full Gospel Baptist Church, Inc., 29 AD3d 893; Yellow Book of N.Y., Inc. v Weiss, 44 AD3d 755; Crespo v A.D.A. Mgt., 292 AD2d 5; Metropolitan Steel Indus. v Rosenshein Hub Dev. Corp., 257 AD2d 422; Niemiec v Niemiec, 180 Misc 2d 207; Malik v Cukrowski, 172 Misc 2d 360; Al-Dohan v Kouyoumjian, 114 Misc 2d 170.)
   OPINION OF THE COURT

Smith, J.

We hold that a liability insurer is entitled to disclaim coverage when the insured, because of its own error in failing to update the address it had listed with the Secretary of State, did not comply with a policy condition requiring timely notice of a lawsuit.

Briggs Avenue LLC is the owner of a building in the Bronx. The company was incorporated in 1999. Shaban Mehaj is its manager and only member. As required by Limited Liability Company Law § 301, Briggs’s articles of organization designated the Secretary of State as its agent to receive service of process. The articles included Briggs’s address, but Briggs later moved, and Mehaj did not notify the Secretary of State of the change. His explanation is that the lawyer who formed the company for him did not tell him of the need to keep the address updated.

In July 2003, a tenant of the building, Nelson Bonilla, began a personal injury action against Briggs, and served the summons and complaint on the Secretary of State. Because the Secretary of State did not have a current address for Briggs, Mehaj did not receive the summons and complaint and did not know that the lawsuit existed. He learned of it only in April 2004, when Bonilla served directly on Briggs a motion for a default judgment. Briggs then gave notice to its liability insurer, Insurance Corporation of Hannover (ICH), of the claim against it. ICH promptly disclaimed coverage, relying among other things on a policy provision saying: “If a claim is made or ‘suit’ is brought against any insured, you must . . . [n]otify us as soon as practicable.”

Briggs brought a declaratory judgment action in Supreme Court against ICH, asking that the insurer be required to defend the Bonilla case. ICH removed the action to the United States District Court for the Southern District of New York, and the District Court dismissed Briggs’s complaint, holding that ICH’s disclaimer was valid (2006 WL 1517606, 2006 US Dist LEXIS 34854 [2006]). Briggs appealed to the United States Court of Appeals for the Second Circuit, which certified to us the following question: “Upon all the facts of this case, given the terms of the insurance policy and the reason for the insured’s failure to give more prompt notice of the lawsuit to the insurer, should the insurer’s disclaimer of coverage be sustained?” (516 F3d 42, 49-50 [2008].)

Our answer to the question is yes.

The validity of ICH’s disclaimer turns on whether Briggs complied with the condition of the policy requiring it to give notice of a lawsuit to ICH “as soon as practicable.” Clearly, it did not. It was unquestionably practicable for Briggs to keep its address current with the Secretary of State, and thus to assure that it would receive, and be able to give, timely notice of the lawsuit. Briggs’s failure to do so was simply an oversight.

Briggs relies on Agoado Realty Corp. v United Intl. Ins. Co. (95 NY2d 141 [2000]), in which we held that there was an issue of fact as to whether notice of a lawsuit was given “as soon as practicable.” But Agoado is distinguishable. In that case, the Secretary of State sent documents to the insureds’ lawyer, but the lawyer had died, and the insureds claimed they did not know of his death. Thus, in Agoado it may really have been impracticable for the insureds to find out about the lawsuit and give timely notice to the insurer. In this case, however, it is clear that the insured could have prevented the mishap.

Briggs’s argument is essentially that its mistake was understandable; that it caused no prejudice to the insurer; and that the loss of insurance coverage is a harsh result. All this may be true, but it is irrelevant. We have long held, and recently reaffirmed, that an insurer that does not receive timely notice in accordance with a policy provision may disclaim coverage, whether it is prejudiced by the delay or not (Argo Corp. v Greater N.Y. Mut. Ins. Co., 4 NY3d 332, 339 [2005]; Security Mut. Ins. Co. of N.Y. v Acker-Fitzsimons Corp., 31 NY2d 436, 440 [1972]). While this rule produces harsh results in some cases, it also, by encouraging prompt notice, enables insurers to investigate claims promptly and thus to deter or detect claims that are ill-founded or fraudulent. The Legislature, weighing the competing interests at stake, has recently enacted legislation that strikes a different balance, more favorable to the insured (see L 2008, ch 388, §§ 2, 4 [amending Insurance Law § 3420, applicable to policies issued on or after January 17, 2009]), but that legislation has not yet become effective. The common-law no-prejudice rule applies to this case.

Accordingly, the certified question should be answered in the affirmative.

Chief Judge Kaye and Judges Ciparick, Graffeo, Read, Pigott and Jones concur.

Following certification of a question by the United States Court of Appeals for the Second Circuit and acceptance of the question by this Court pursuant to section 500.27 of the Rules of Practice of the Court of Appeals (22 NYCRR 500.27), and after hearing argument by counsel for the parties and consideration of the briefs and the record submitted, certified question answered in the affirmative.