author: Read, J.

text:
    [992 NE2d 402, 970 NYS2d 474]
    In the Matter of Dashawn W. and Others, Children Alleged to be Abused. Administration for Children’s Services, Respondent, Antoine N., Appellant, et al., Respondent.
    Argued March 20, 2013;
    decided April 25, 2013

      POINTS OF COUNSEL

      Elisa Barnes, New York City, for appellant.
    I. By legislative design the severe abuse statute applies to very few cases. (Matter of Leon K. [Marilyn O.], 69 AD3d 856; Matter of Candace S., 38 AD3d 786; Matter of Latifah C., 34 AD3d 798; Matter of Kayden E. [Luis E.], 88 AD3d 1205, 18 NY3d 803; Leader v Maroney, Ponzini & Spencer, 97 NY2d 95; Rosner v Metropolitan Prop. & Liab. Ins. Co., 96 NY2d 475; Matter of Bliss v Bliss, 66 NY2d 382.) II. The Commissioner of the New York City Administration for Children’s Services did not submit evidence of diligent efforts to reunite appellant with his children and under the statutory scheme could not have been excused from such efforts. (Matter of Borkowski v Borkowski, 38 AD2d 752; Loeb v Loeb, 14 AD2d 270; Matter of Leon K. [Marilyn O.], 69 AD3d 856, 83 AD3d 1069; Matter of Candace S., 38 AD3d 786; Matter of Latifah C., 34 AD3d 798.) III. Appellant Antoine N. was erroneously found to have acted with depraved indifference to Jayquan’s life. (People v Suarez, 6 NY3d 202; People v Best, 85 NY2d 826; People v Poplis, 30 NY2d 85; People v Goodridge, 251 AD2d 85.)

      Michael A. Cardozo, Corporation Counsel, New York City (Deborah A. Brenner and Kristin M. Helmers of counsel), for respondent.
    I. The Appellate Division correctly ruled that the father’s conduct evinced depraved indifference to Jayquan’s life. (Matter of Marino S., 100 NY2d 361; People v Cole, 85 NY2d 990; People v Poplis, 30 NY2d 85; People v Bryce, 88 NY2d 124; People v Bowman, 48 AD3d 178,10 NY3d 808; People v Maddox, 31 AD3d 970; People v Paul, 209 AD2d 447, 85 NY2d 865; People v Suarez, 6 NY3d 202; Matter of Jessica MM., 122 AD2d 462; People v Luck, 294 AD2d 618, 98 NY2d 699.) II. Diligent efforts to reunite the family should not be a part of a fact-finding of severe abuse. In the alternative, such efforts were properly excused here. (People v Caban, 14 NY3d 369; Matter of Rivera v Smith, 63 NY2d 501; Telaro v Telaro, 25 NY2d 433.)

      Steven Banks, Legal Aid Society, New York City (Claire V. Merkine and Tamara A. Steckler of counsel), Attorney for the Children.
    I. The Appellate Division erred in the first appeal in remanding the case for a hearing on diligent efforts, where a finding that diligent efforts were made or excused is not required for a severe abuse finding under Family Court Act § 1051 (e). In any event, the Appellate Division properly affirmed in the second appeal the Family Court’s finding that diligent efforts should be excused. (Matter of Marino S., 100 NY2d 361; Long v State of New York, 7 NY3d 269; Matter of New York State Assn. of Criminal Defense Lawyers v Kaye, 96 NY2d 512; Frank v Meadowlakes Dev. Corp., 6 NY3d 687; Zappone v Home Ins. Co., 55 NY2d 131; Rohring v City of Niagara Falls, 84 NY2d 60; Matter of Leon K. [Marilyn O.], 69 AD3d 856; Matter of Carlos R., 63 AD3d 1243.) II. The Appellate Division correctly found that appellant evinced depraved indifference to his child’s life.
   OPINION OF THE COURT

Read, J.

We hold that the phrase “circumstances evincing a depraved indifference to human life” does not mean the same thing for purposes of Social Services Law § 384-b (8) (a) (i) as it does under the Penal Law. Second, a showing of diligent efforts to encourage and strengthen the parental relationship is not prerequisite to a finding of severe abuse under Family Court Act § 1051 (e) where the factfinder determines that such efforts would be detrimental to the best interests of the child.

I

On February 23, 2007, the Commissioner of the New York City Administration for Children’s Services (the Commissioner or ACS) filed related petitions under article 10 of the Family Court Act against Antoine N. and Ronnelle B. with respect to the four children who resided with them: five-month-old Jayquan N., five-year-old Justin N., five-year-old Diamonaysia B., and two-year-old Dashawn W. Antoine and Ronnelle are Jayquan’s parents, while Antoine is Justin’s father and Ronnelle is the mother of Diamonaysia and Dashawn. ACS had carried out an emergency removal pursuant to Family Court Act § 1024 the previous day, after social workers at Bellevue Hospital Center reported suspected child abuse to the Statewide Central Register of Child Abuse and Maltreatment.

The petitions in these child protective proceedings alleged that Jayquan, whom Antoine brought to Bellevue on the evening of February 21, 2007—hours after he claimed that the baby screamed in a way unlike ever before—had been admitted with a “shifted and fractured collar-bone with swelling”; and that, upon further examination, hospital personnel discovered four partially healed fractured ribs. The petitions also asserted that Antoine “inflict[ed] excessive corporal punishment” on Justin by hitting him with a “black wire,” thereby causing “excessive welts to his body”; and that Ronnelle failed to intervene to protect him. The Commissioner sought orders determining, upon clear and convincing evidence, that these four children were severely or repeatedly abused, and, upon a preponderance of the evidence, that they were abused and/or neglected.

At the ensuing fact-finding hearing, ACS called Dr. Lori Légano, who examined Jayquan at Bellevue on February 22, 2007, acting as a consultant with a child protection team; Dr. Légano was qualified as an expert in pediatrics and child abuse. She testified that the fracture of Jayquan’s left collarbone (or clavicle) was sustained within less than a week before his admission to the hospital, and that the most likely cause was a direct blow to the shoulder. Because of the level of force required to inflict this injury, Dr. Légano rejected Antoine’s explanation— that two-year-old Dashawn pulled Jayquan’s arms while he sat in his “bouncy chair” the day before Antoine took Jayquan to the hospital—as medically implausible. According to Dr. Légano, a two year old could not have generated enough force to separate Jayquan’s clavicle by pulling on his arms. For the same reason, she discounted the notion, suggested by Antoine’s attorney, that Jayquan may have broken his collarbone when one of the other children hit him, or fell against him while he sat in the bouncy chair, thereby somehow propelling him onto the floor. Dr. Légano ruled out birth trauma as the cause of Jayquan’s fractured collarbone because his medical records disclosed an unremarkable delivery and the break was so fresh; and based on Jayquan’s medical records and the results of blood and other tests, she eliminated other possible causative factors (e.g., insufficient vitamin D, malnourishment, low bone density). Dr. Légano testified that a clavicle fracture was not life-threatening and would heal on its own without any treatment, but Jayquan would experience discomfort in the meantime unless he kept his shoulder “totally still.”

As for Jayquan’s four broken ribs, Dr. Légano testified that “a lot of force” would have been required to cause these injuries. Further, the fractures were all on the baby’s left side, rather than bilateral, as would be expected if one of the other children stood or stamped on Jayquan while he lay on the floor, which Antoine’s attorney speculated may have happened. In the absence of a major trauma such as a car accident, Dr. Légano viewed Jayquan’s broken ribs as most likely an “inflicted injury” caused by “direct force to the middle of the chest,” or “blunt trauma to the side of the chest”; she added that, given the pliability of an infant’s ribs, fractures are a classic sign of child abuse, almost always caused by an intentional act. Her observation of callus formation caused Dr. Légano to conclude that Jayquan had sustained these injuries between two weeks and several months before his admission to the hospital. She opined that Jayquan’s discomfort should have been noticeable because as his chest expanded with each breath, the broken edges of the ribs would rub together, causing virtually continuous pain.

An ACS caseworker, who interviewed each member of the family, testified that Antoine and Ronnelle surmised that Jayquan must have broken his ribs in mid-December 2006 when he and two-year-old Dashawn were playing on a bed with their maternal grandfather, and Dashawn either hit or kicked Jayquan. The caseworker, who also physically examined each of the children for signs of abuse, observed “black linear marks . . . too many to count” on Justin’s chest, stomach, inner thigh and buttocks. Antoine conceded that he had lashed the child with an electrical cord, which he justified as punishment meted out after discovering Justin and Diamonaysia, both five years old, doing “adult things.” The caseworker added that when she tried to comfort Dashawn as he was crying, he yelled at her, “Get out of my face . . . [bjefore I get my belt,” which Diamonaysia explained Antoine said “all the time.”

Antoine did not testify at the hearing or call any witnesses. Family Court took judicial notice of a finding of abuse against Antoine in 1994 relating to his infant son, Antoine, Jr. In a fact-finding decision and order entered on April 11, 1994, Family Court found that then four-month-old Antoine, Jr. sustained bilateral subdural hematomas in his brain, four fractured ribs on his left side and a fractured wrist and skull; that Antoine and the infant’s mother provided no satisfactory or convincing explanation for these injuries; and that the brain injuries were so serious that it was unknown whether Antoine, Jr. would fully recover or, instead, suffer from mental retardation.

At the conclusion of the hearing, Family Court determined that Antoine and Ronnelle abused Jayquan “in that[,] while in the care of [Antoine and Ronnelle, the] child sustained fractures of the clavicle and of the left 4-7 ribs . . . [and Antoine and Ronnelle] have not offered any credible explanation for any of these injuries”; and that they neglected and derivatively abused Justin, and derivatively abused and neglected Dashawn and Diamonaysia. While finding that Jayquan sustained “[s]erious physical injury, . . . protracted, painful, [and] horrible injuries,” Family Court nonetheless dismissed the petition insofar as it alleged severe abuse against Antoine. The judge believed that, in view of our decision in People v Suarez (6 NY3d 202 [2005]), severe abuse under Social Services Law § 384-b (8) (a) (i)—which requires a finding that Antoine acted “under circumstances evincing a depraved indifference to human life”— could almost never be established unless an eyewitness testified to the manner in which the harm was inflicted. Supported by the Attorney for the Children, ACS appealed from Family Court’s dismissal of the claim of severe abuse; Antoine did not cross-appeal the judge’s findings of serious physical injury and abuse.

In May 2010, the Appellate Division reversed (73 AD3d 574 [1st Dept 2010]). The court first held that Family Court was not constrained by Suarez because “Social Services Law § 384-b (8) (a) encompasses conduct which is either intentional or reckless, unlike Penal Law § 125.25 (1) and (2), which, pursuant to Suarez, are almost always mutually exclusive”; and “[i]n any event, Suarez recognized that in cases involving abused children, conduct evincing depraved indifference to human life may be present in a one-on-one situation” (id. at 574).

The Appellate Division then found that “the baby sustained . . . serious physical injuries while in the care of [Antoine], and the parents failed to provide an adequate explanation”; and noted that Family Court “was entitled to draw the strongest negative inference against the father based on his failure to testify in the proceedings” (id. at 575). As a result, “father’s conduct directed at the infant was sufficient to demonstrate depraved indifference to the child’s life” (id.). Citing Social Services Law § 384-b (8) (a) (i) and (iv), the Court then noted that, “due to [Family Court’s] misinterpretation of Suarez, it never reached the issue of whether [ACS] exercised diligent efforts to strengthen the parental relationship”; and therefore remanded for the lower court to decide “if [ACS] exerted such efforts or whether such efforts are excused, since a finding of severe abuse is admissible in a subsequent proceeding to terminate parental rights” (id.).

Upon remand, Family Court determined that diligent efforts should be excused because they would be “detrimental to the best interests of the child(ren).” In support of this finding, the judge cited Antoine’s 1994 abuse adjudication, remarking that “we come now to . . . a time approximately 14 years later, when [Antoine] has again displayed egregious conduct towards a child [u]nder circumstances evincing a depraved indifference to the [child’s] life and health.” According to Family Court, the earlier incident, in combination with the events leading to these petitions, demonstrated that the “prognosis for change in [Antoine’s] indifferent behavior is poor.” The judge therefore found that “efforts to encourage and strengthen the parental relationship would be detrimental to the best interests of [Jayquan] as they would consign him to a further protracted stay in foster care, thereby depriving him of permanency and of a normal, healthy and safe life, with virtually no likelihood of ultimate reunification.”

Antoine appealed Family Court’s order excusing diligent efforts and, at the same time, moved for leave to appeal to us. After we dismissed his motion upon the ground that simultaneous appeals do not lie (16 NY3d 767 [2011]), the Appellate Division affirmed (91 AD3d 505 [1st Dept 2012]). In that court’s view,

“Family Court properly determined, in light of [the] prior determination that there was clear and convincing evidence that the child . . . was ‘severely abused[,]’ . . . that such ‘[aggravated circumstances’ (Family Ct Act § 1012 [j]) excused ACS from exercising diligent efforts to reunite the father with the child because such efforts would be detrimental to the best interests of the child and are unlikely to be successful in the foreseeable future” (id. at 506).

The Appellate Division rejected the “father’s attempt to characterize the Family Court’s proceedings conducted pursuant to [the remand] as a wholly distinct and separate hearing,” concluding instead that they were merely a “continuation of the prior fact-finding hearing” (id.).

We granted Antoine leave to appeal (19 NY3d 804 [2012]), and now affirm, although for slightly different reasons.

II

At the conclusion of the fact-finding phase in an article 10 proceeding, Family Court may,

“[i]n addition to a finding of abuse, . . . enter a finding of severe abuse ... as defined in [Social Services Law § 384-b (8) (a)], which shall be admissible in a proceeding to terminate parental rights pursuant to [Social Services Law § 384-b]. If the court makes such additional finding of severe abuse . . . , the court shall state the grounds for its determination, which shall be based upon clear and convincing evidence” (Family Ct Act § 1051 [e] [emphases added]).

Section 384-b (8) (a) of the Social Services Law, in turn, specifies that “[flor the purposes of this section [384-b],” which governs termination of parental rights, a child is “severely abused” if

“(i) the child has been found to be an abused child as a result of reckless or intentional acts of the parent committed under circumstances evincing a depraved indifference to human life, which result in serious physical injury to the child as defined in [Penal Law § 10.00 (10)] ;[] or
“(ii) the child has been found to be [a sexually abused child]; provided, however, the [parent] must have committed or knowingly allowed to be committed [1 of 11 enumerated felony sex offenses] . . . ; or
“(iii) [the child’s parent has been convicted of certain felony offenses under the Penal Law,() and] the victim or intended victim was the child or another child of the parent or another child for whose care such parent is or has been legally responsible; or . . . the parent of such child has been convicted under the law in any other jurisdiction of an offense which includes all of the essential elements [of these crimes]; and
“(iv) the agency has made diligent efforts to encourage and strengthen the parental relationship, including efforts to rehabilitate the respondent, when such efforts will not be detrimental to the best interests of the child, and such efforts have been unsuccessful and are unlikely to be successful in the foreseeable future. Where a court has previously determined in accordance with this chapter or the family court act that reasonable efforts to make it possible for the child to return safely to his or her home are not required, the agency shall not be required to demonstrate diligent efforts as set forth in this section” (Social Services Law § 384-b [8] [a] [i]-[iv] [emphases added]).

In this appeal, the parties differ as to what is required to establish “circumstances evincing a depraved indifference to human life” within the meaning of Social Services Law § 384-b (8) (a) (i); and whether the diligent efforts specified by subparagraph (iv) of this provision are prerequisite to a finding of severe abuse under Family Court Act § 1051 (e), or may be excused under Family Court Act §§ 1039-b and 1012 (j) or, alternatively, Social Services Law § 384-b (8) (a) (iv) itself.

Depraved Indifference

ACS, joined by the Attorney for the Children, argues that our cases discussing “circumstances evincing a depraved indifference to human life” within the meaning of the Penal Law do not control the interpretation of the same phrase in Social Services Law § 384-b (8) (a) (i). Antoine, by contrast, considers “depraved indifference” to require the same showing under both statutes. The facts in this case, he argues, “though disquieting and unpleasant, simply do not rise to the level of depraved indifference” discussed in Suarez and other cases in the progression of decisions culminating in People v Feingold (7 NY3d 288 [2006] [recounting the evolution of the Court’s depraved indifference jurisprudence]; see also Policano v Herbert, 7 NY3d 588 [2006] [same]). In Feingold, we held that depraved indifference denotes a culpable mental state beyond mere recklessness, and explicitly overruled People v Register (60 NY2d 270 [1983]). Register had stood for the proposition that depraved indifference was “neither the mens rea nor the actus reus” of a crime, but rather referred to “the factual setting in which the [defendant’s] risk creating conduct must occur” (id. at 276) so that “the focus of the offense [was] upon an objective assessment of the degree of risk presented by defendant’s reckless conduct” (id. at 277; see also Policano, 7 NY3d at 599-600).

Under the Penal Law, a person acts “intentionally” when “his conscious objective” is to cause a proscribed result (for example, death) or engage in conduct described by a statute (Penal Law § 15.05 [1]); and a person acts “recklessly” with respect to a proscribed result or a circumstance described by a statute “when he is aware of and consciously disregards a substantial and unjustifiable risk that such result will occur or that such circumstance exists” (Penal Law § 15.05 [3]). And “depraved indifference” bespeaks a state of mind reflecting “a depraved kind of wantonness: for example, shooting into a crowd, placing a time bomb in a public place, or opening the door of the lions’ cage in the zoo” (Feingold, 7 NY3d at 293 [internal quotation marks omitted]). It is “best understood as an utter disregard for the value of human life—a willingness to act not because one intends harm, but because one simply doesn’t care whether grievous harm results or not[, and which reflects] wickedness, evil or inhumanity, as manifested by brutal, heinous and despicable acts” (Suarez, 6 NY3d at 214). The Penal Law establishes crimes that are mutually exclusive, depending on these distinctions of culpable state of mind; specifically, second-degree intentional murder (Penal Law § 125.25 [1] [mens rea of intent to kill]), as contrasted with second-degree depraved indifference murder (Penal Law § 125.25 [2] [mens rea of recklessness plus mens rea of depraved indifference]), as contrasted with second-degree manslaughter (Penal Law § 125.15 [mens rea of recklessness]).

The same cannot be said of the child protective statutes. Social Services Law § 384-b (8) (a) (i) provides that a child can be found to be severely abused “as a result of reckless or intentional acts of the parent committed under circumstances evincing a depraved indifference to human life” (emphases added). Under the Penal Law, however, a crime requiring proof of an intent to kill can never be committed with depraved indifference (see Policano, 7 NY3d at 600 [“(I)t has never been permissible in New York for a jury to convict a defendant of depraved indifference murder where the evidence produced at trial indicated that if the defendant committed homicide at all, he committed it with the conscious objective of killing the victim” (internal quotation marks omitted)]). Additionally, “[a] defendant may be convicted of depraved indifference murder when but a single person is endangered in only a few rare circumstances” (Suarez, 6 NY3d at 212), whereas acts of child abuse necessarily involve one-on-one violence. In short, our depraved indifference jurisprudence under the Penal Law has no bearing on whether a child is severely abused within the meaning of Social Services Law § 384-b (8) (a) (i). For purposes of that statute “circumstances evincing a depraved indifference to human life” refers to the risk intentionally or recklessly posed to the child by the parent’s abusive conduct.

Here, Antoine beat or struck a baby—an especially vulnerable victim because so tiny, defenseless and unformed. And Dr. Legano’s testimony about the age of Jayquan’s injuries established that Antoine must have attacked him on at least two different occasions, separated by at least two weeks. Further, Antoine had to have been aware of the life-threatening risks he created when he applied brute force to Jayquan’s chest and shoulder. After all, he knew that devastating injuries ensued when he brutalized his then four-month-old namesake, Antoine, Jr. While this prior instance of abuse was too remote in time to support a finding of repeated abuse, it reflects Antoine’s utter disregard for Jayquan’s life, health and well-being. Additionally, Antoine neglected to summon medical aid for Jayquan’s fractured ribs, even though the baby would have to have experienced and displayed continuous pain and distress; and he delayed seeking medical care for Jayquan on February 21, 2007 from 11:00 a.m., when he claimed to have first noticed the baby’s suffering, until the early evening hours. Finally, Antoine offered unbelievable explanations for Jayquan’s injuries to medical personnel and social workers, and he did not testify at the fact-finding hearing (see Matter of Nassau County Dept. of Social Servs. v Denise J., 87 NY2d 73, 79 [1995] [where the mother did not testify in a child protective proceeding, we noted that “(a) trier of fact may draw the strongest inference that the opposing evidence permits”]). Thus, there is record support for the Appellate Division’s finding, based on clear and convincing evidence, that Antoine, acting under circumstances evincing a depraved indifference to human life, severely abused Jayquan.

Diligent Efforts

At no time did ACS make “diligent efforts to encourage and strengthen the parental relationship, including efforts to rehabilitate” Antoine (see Social Services Law § 384-b [8] [a] [iv]). This is undisputed. What the parties instead contest is whether this omission was permissible in light of Family Court Act §§ 1051 (e), 1039-b and 1012 (j). The Attorney for the Children, joined by ACS, urges that a showing of diligent efforts is not required for a finding of severe abuse under Family Court Act § 1051 (e), while Antoine naturally insists otherwise. But Antoine also maintains that diligent efforts are incapable of being excused under Family Court Act §§ 1039-b and 1012 (j) on the basis of severe abuse. So for very different reasons leading to diametrically opposite practical outcomes, the Attorney for the Children and Antoine both take the position that the Appellate Division erred when, in the first appeal, it remanded this case to Family Court for a finding as to whether diligent efforts were made or excused. The Attorney for the Children argues in the alternative, though, that Family Court was permitted to and properly excused diligent efforts pursuant to Social Services Law § 384-b (8) (a) (iv) itself.

Section 1039-b (a) of the Family Court Act states that “[i]n conjunction with, or at any time subsequent to, the filing of a[n abuse or neglect] petition . . . , the [presentment agency] may file a motion upon notice requesting a finding that reasonable efforts to return the child to his or her home are no longer required.” The statute further provides that reasonable efforts “shall not be required” when “the parent of such child has subjected the child to aggravated circumstances, as defined in” Family Court Act § 1012 (j) (Family Court Act § 1039-b [b] [1] [emphasis added]). Family Court Act § 1012 (j) defines “aggravated circumstances” to include “where a child has been either severely or repeatedly abused, as defined in” Social Services Law § 384-b (8) (emphasis added).

First, Antoine takes as a given that Family Court Act §§ 1039-b and 1012 (j) provide the only way for a presentment agency to sidestep diligent efforts. Then he reasons—in “[a]n almost Talmudic exercise in statutory application, following the trail of FCA § 1051 (e) to Social Services Law § 384-b (8) to FCA § 1039-b to FCA § 1012 (j)”—that a finding of severe abuse pursuant to Family Court Act § 1051 (e) can never serve as an “aggravated circumstance” excusing “reasonable efforts to return the child to his or her home” pursuant to Family Court Act §§ 1039-b (a), (b) (1) and 1012 (j) because Social Services Law § 384-b (8) (a) requires diligent efforts as a prerequisite to a finding of severe abuse. Antoine asserts that his analysis is not circular and does not render Family Court Act § 1039-b (b) (1) meaningless because a court might have previously determined, as also provided for in subparagraph (iv) of section 384-b (8) (a), that reasonable efforts were not required to return a severely abused child to his or her family on the basis of one of the grounds enumerated in Family Court Act § 1039-b (b) (2)-(6) (see n 10, supra).

The Attorney for the Children points out that the legislature in 1999 adopted Family Court Act § 1039-b and amended Family Court Act § 1051 (e) and Social Services Law § 384-b (8) (a) to implement the Federal Adoption and Safe Families Act (ASFA). ASEA clarified when states must engage in reasonable efforts to bring parents and an abused or neglected child back together, and when these efforts could or should be excused or discontinued. To address the “uncertainty about the reasonable efforts standard [that] sometimes delays State action in making children available for adoption,” Congress therefore “permitted] the State[s] to bypass” the “reasonable efforts criterion” in cases where a parent subjected a child to “aggravated circumstances” as defined under state law, and to “move expeditiously to terminate parental rights and make [these abused and neglected children] available for adoption” (HR Rep No. 105-77, 105th Cong, 1st Sess at 7-8, reprinted in 1997 US Code Cong & Admin News at 2739, 2739-2740; see also Marino S., 100 NY2d at 369-370 [“The effect of a finding of aggravated circumstances under the Family Court Act—like the effect of a finding of severe abuse under the Social Services Law (severe abuse itself constitutes an aggravated circumstance)—is to dispense with the requirement that an agency responsible for having placed the children in foster care or seeking to terminate parental rights exercise diligent or reasonable efforts to reunite the (parent[s]) with the children”]).

The Attorney for the Children objects that Antoine’s view of the interplay of the Family Court Act and the Social Services Law, which negates severe abuse as an independent basis under Family Court Act § 1039-b (b) (1) for excusing reasonable efforts, runs counter to ASFA’s express purpose “to expedite permanency for children who suffer . . . the ‘aggravated circumstance’ of severe abuse.” Seeking to harmonize the statutes in a way faithful to ASFA’s goals and New York’s concomitant statutory scheme, she maintains that the legislature, “when referencing the definition of ‘severe abuse’ in Social Services Law § 384-b (8) (a) in Family Court Act §§ 1012 (j) and 1051 (e), intended to borrow only the abusive acts described in [subparagraphs] (i) through (Hi) of Social Services Law § 384-b (8) (a), and not the diligent efforts showing of [subparagraph] (iv)” (emphasis added). This approach “completely resolves the circularity and incongruity” created by Antoine’s interpretation of the statutes “and fully accords with the purpose of ASFA.”

Finally, the Attorney for the Children advances the alternative position that if subparagraph (iv) of Social Services Law § 384-b (8) (a) is, in fact, incorporated into article 10’s definition of severe abuse, as Antoine argues, then Family Court is authorized to excuse diligent efforts upon a finding that they would be detrimental to the child’s best interests. We agree. First, we conclude that Family Court Act §§ 1051 (e) and 1012 (j) necessarily import Social Services Law § 384-b (8) (a) in its entirety. We simply cannot read subparagraph (iv) out of the definition of severe abuse incorporated in these provisions when the legislature did not choose to create such an exclusion, as it easily might have. Second, Social Services Law § 384-b (8) (a) (iv) clearly states that Family Court may excuse diligent efforts when they are found to be detrimental to the best interests of the child.

To recapitulate, Social Services Law § 384-b (8) (a) defines a child as “severely abused” if the victim of depraved indifference abuse (id. § 384-b [8] [a] [i]), or felony sex offense abuse (id. § 384-b [8] [a] [ii]), or other felony offense abuse (id. § 384-b [8] [a] [iii]), and

“the agency has made diligent efforts to encourage and strengthen the parental relationship, including efforts to rehabilitate the respondent, when such efforts will not be detrimental to the best interests of the child, and such efforts have been unsuccessful and are unlikely to be successful in the foreseeable future. Where a court has previously determined in accordance with this chapter or the family court act that reasonable efforts to make it possible for the child to return safely to his or her home are not required, the agency shall not be required to demonstrate diligent efforts as set forth in this section” {id. § 384-b [8] [a] [iv] [emphases added]).

Thus, for a court to find severe abuse under Family Court Act § 1051 (e), the presentment agency must demonstrate by clear and convincing evidence that the parent committed an abusive act specified in subparagraphs (i), (ii) or (iii) of section 384-b (8) (a); and diligent efforts to reunite the family were not made because detrimental to the child’s best interests; or such efforts were made but were unsuccessful and unlikely to succeed in the near term; or such efforts were not required because a court had previously determined that reasonable efforts to reunite the family were unnecessary.

The Attorney for the Children is surely correct that the legislature adopted Family Court Act § 1039-b to “expedite permanency planning for abused children by enabling the agency to obtain an immediate determination—during the underlying abuse proceeding—of whether it must exercise diligent efforts, without first having to expend considerable effort . . . until a ruling [could] finally be sought in the subsequent termination proceeding” (see Marino S., 100 NY2d at 371). The proposition that the legislature “borrowed” only the abusive acts described in Social Services Law § 384-b (8) (a) (i)-(iii) when referring to section 384-b (8) (a) in Family Court Act §§ 1051 (e) and 1012 (j) is thus intuitively appealing. Perhaps this is what the legislature meant to do. The statutory language, however, does not admit of this interpretation. In sum, both Antoine and the Attorney for the Children weave complex interpretive skeins to justify their preferred outcomes. Each asks us to disregard section 384-b (8) (a) (iv) in the context of child protective proceedings, either wholly (the Attorney for the Children) or in part (Antoine). We opt instead for a straightforward reading of Family Court Act §§ 1051 (e) and 1012 (j) and Social Services Law § 384-b (8) (a).

Finally, Family Court in this case properly found that diligent efforts to encourage and strengthen the parental relationship would be detrimental to Jayquan’s best interests, in accordance with Social Services Law § 384-b (8) (a) (iv). The judge determined that, in light of Antoine’s abuse of Antoine, Jr., followed by his severe abuse of Jayquan some 14 years later, there was little prospect that Antoine’s “chronic, long-standing” violent behavior would improve anytime soon, if ever, and it was not in Jayquan’s best interests to languish in foster care in the meantime.

We have considered Antoine’s other arguments and consider them to be without merit. Accordingly, the order of the Appellate Division should be affirmed, without costs.

Chief Judge Lippman and Judges Graffeo, Smith, Pigott and Rivera concur.

Order affirmed, without costs.

      . Jayquan remained hospitalized at Bellevue until discharged on March 2, 2007 to the custody of an ACS caseworker for placement in a designated foster boarding house.

      . Dr. Légano sometimes referred to the “bouncy chair” as an “ExerSaucer,” which is a brand name for a stationary play center. The “bouncy chair,” a picture of which was entered into evidence, consists of a round or saucer-shaped base with an elevated swivel seat in the middle; a tray surrounds the seat. These products allow babies old enough to sit and hold up their heads unassisted to remain upright to practice standing, and to entertain themselves by rocking, spinning, bouncing and playing with available, often built-in, toys. They are designed to be stable and so are unlikely to tip over; they do not allow movement around a room, and thus eliminate the risk of falls down stairs or stumbles.

      . Family Court Act § 1012 (e) defines an “abused child” as a child under 18 years old
      “whose parent or other person legally responsible for his care “(i) inflicts or allows to be inflicted upon such child physical injury by other than accidental means which causes or creates a substantial risk of death, or serious or protracted disfigurement, or protracted impairment of physical or emotional health or protracted loss or impairment of the function of any bodily organ, or
      “(ii) creates or allows to be created a substantial risk of physical injury to such child by other than accidental means which would be likely to cause death or serious or protracted disfigurement, or protracted impairment of physical or emotional health or protracted loss or impairment of the function of any bodily organ, or
      “(iii) commits, or allows to be committed an offense against such child defined in [Penal Law article 130, governing sex offenses]; allows, permits or encourages such child to engage in any act described in [specified provisions of the Penal Law relating to prostitution]; commits any of the acts described in [specified provisions of the Penal Law relating to incest]; or allows such child to engage in acts or conduct described in [Penal Law article 263, governing sexual performance by a child] provided, however, that (a) the [Penal Law’s] corroboration requirements . . . and (b) the age requirement for the application of article [263] shall not apply-”

      . Family Court Act § 1012 (f) (i) (B) defines a “neglected child” to include a child under 18 years old
      “whose physical, mental or emotional condition has been impaired or is in imminent danger of becoming impaired as a result of the failure of his parent or other person legally responsible for his care to exercise a minimum degree of care ... in providing the child with proper supervision or guardianship, by unreasonably inflicting or allowing to be inflicted harm, or a substantial risk thereof, including the infliction of excessive corporal punishment” (emphasis added).

      . As we noted in Matter of Marino S. (100 NY2d 361, 373-374 [2003], cert denied sub nom. Marino S. v Angel Guardian Children & Family Servs., 540 US 1059 [2003]), while article 10
      “is silent with respect to derivative findings of abuse[,] . . . indirect support . . . may be found in the evidentiary rule set forth in Family Court Act § 1046 (a) (i), which provides that ‘proof of the abuse or neglect of one child shall be admissible evidence on the issue of the abuse or neglect of any other child of, or the legal responsibility of, the respondent’ ” (see Merril Sobie, Practice Commentaries, McKinney’s Cons Laws of NY, Book 29A, Family Ct Act § 1012 at 44-46 [discussing the derivative doctrine as it has developed in New York]).

      . At the conclusion of ACS’s case, Family Court granted Ronnelle’s motion to dismiss the charge of severe abuse against her on the ground that ACS had not made a prima facie showing. ACS never seems to have formally abandoned the charge of repeated abuse, although Ronnelle was not subject to any prior findings of abuse, and Antoine’s prior abuse finding dated from 1994 (see Social Services Law § 384-b [8] [b] [ii] [A] [providing that a child is “repeatedly abused” by a parent if “the child or another child for whose care such parent is or has been legally responsible has been previously found, within the five years immediately preceding the initiation of the proceeding in which such abuse is found, to be an abused child” (emphasis added)]). The judge did not mention repeated abuse in her fact-finding ruling.

      . Section 10.00 (10) of the Penal Law defines “serious physical injury” as “physical injury which creates a substantial risk of death, or which causes death or serious and protracted disfigurement, protracted impairment of health or protracted loss or impairment of the function of any bodily organ.”

      . The felony offenses include first- or second-degree murder, first- or second-degree manslaughter, or an attempt to commit murder or manslaughter; criminal solicitation, conspiracy or criminal facilitation for conspiring, soliciting or facilitating these crimes; or first- or second-degree assault or aggravated assault upon a person less than 11 years old or any attempt to commit these crimes.

      . The record from the hospital’s pediatric emergency service is date-stamped 8:17 p.m. on February 21, 2007.

      . Additionally, reasonable efforts are not required where the parent has been convicted of the murder or manslaughter of another child of that parent (Family Court Act § 1039-b [b] [2]); the parent has been convicted of an attempt to commit murder or manslaughter, or of criminal solicitation, conspiracy or criminal facilitation for conspiring, soliciting or facilitating those crimes, and the victim or intended victim was the child or another child of that parent (id. § 1039-b [b] [3]); the parent has been convicted of first- or second-degree assault or aggravated assault upon a person less than 11 years old, and this criminal conduct caused serious physical injury to the child or another child of the parent (id. § 1039-b [b] [4]); the parent has been convicted “in any other jurisdiction of an offense which includes all of the essential elements of’ any of the foregoing crimes, and the victim was the child or another child of the parent (id. § 1039-b [b] [5]); or “the parental rights of the parent to a sibling of [the] child have been involuntarily terminated” (id. § 1039-b [b] [6]).

        (n. cont’d)

      . “Aggravated circumstances” also include instances where the child has been found to be repeatedly abused within the meaning of Social Services Law § 384-b (8) (b); the child “has subsequently been found to be an abused child [within the meaning of Family Court Act § 1012 (e) (i) or (iii)] within five years after [the] return home following placement in foster care as a result of being found to be a neglected child”; the parent “has refused and . . . failed completely, over a period of at least six months from the date of removal” to engage in or secure reunification services; or “a court has determined a child five days old or younger was abandoned by a parent with an intent to wholly abandon such child and with the intent that the child be safe from physical injury and cared for in an appropriate manner” (see Family Ct Act § 1012 [j]).


source: Caselaw Access Project

author: Rivera, J.

license: Public Domain

text:
    [990 NE2d 114, 967 NYS2d 876]
    Commonwealth of the Northern Mariana Islands, Appellant, v Canadian Imperial Bank of Commerce, Respondent, William H. Millard, Defendant, The Millard Foundation, Intervenor.
    Argued March 18, 2013;
    decided April 30, 2013

      POINTS OF COUNSEL

      Kobre & Kim LLP, New York City (Michael S. Kim and Melanie L. Oxhorn of counsel), for appellant.
    I. CPLR 5225 (b)’s postjudgment enforcement remedy may be applied under circumstances where assets are held by a garnishee’s subsidiary but the garnishee is determined to have the actual, practical ability to direct or control their disposition. (Koehler v Bank of Bermuda Ltd., 12 NY3d 533; Merkling v Ford Motor Co., 251 App Div 89; United States v First Nat. City Bank, 379 US 378; Allied Mar., Inc. v Descatrade SA, 620 F3d 70; JW Oilfield Equip., LLC v Commerzbank, AG, 764 F Supp 2d 587.) II. A court considering whether to issue a turnover order to a garnishee whose subsidiary has actual possession or custody of assets should determine whether the garnishee has the actual, practical ability to control the subsidiary’s disposition of them. (Bellomo v Pennsylvania Life Co., 488 F Supp 744; Frummer v Hilton Hotels Intl., 19 NY2d 533; In re Citric Acid Litig., 191 F3d 1090; First Natl. City Bank of N.Y. v Internal Revenue Serv. of U.S. Treasury Dept., 271 F2d 616; Koehler v Bank of Bermuda Ltd., 12 NY3d 533.)

      Skadden, Arps, Slate, Meagher & Flom LLP, New York City (Scott D. Musoff Timothy G. Nelson and Gregory A. Litt of counsel), for respondent.
    I. A bank that holds no property or accounts of the relevant debtor should not be compelled to turn over money or assets deposited at its foreign subsidiary banks. (Sundail Constr. Co. v Liberty Bank, 277 NY 137; In re Delaney, 256 NY 315; Greenberg, Trager & Herbst, LLP v HSBC Bank USA, 17 NY3d 565; Brigham v McCabe, 20 NY2d 525; Solicitor for Affairs of His Majesty’s Treasury v Bankers Trust Co., 304 NY 282; Cruz v TD Bank, N.A., 855 F Supp 2d 157; Grain Traders, Inc. v Citibank, N.A., 960 F Supp 784; Bradford v Chase Natl. Bank of City of N.Y., 24 F Supp 28; Middle E. Banking Co. v State St. Bank Intl., 821 F2d 897; Geler v National Westminster Bank USA, 770 F Supp 210.) II. The turnover statutes could validly be applied to corporate affiliates only if veil-piercing were established. (Moreau v RPM, Inc., 20 AD3d 456; Insurance Co. of N. Am. v EMCOR Group, Inc., 9 AD3d 319; Frummer v Hilton Hotels Intl., 19 NY2d 533; Bellomo v Pennsylvania Life Co., 488 F Supp 744; Comprehensive Sports Planning v Pleasant Val. Country Club, 73 Misc 2d 477; IRBBrasil Resseguros, S.A. v Inepar Invs., S.A., 20 NY3d 310; Tri City Roofers v Northeastern Indus. Park, 61 NY2d 779; Western Union Telegraph Co. v Pennsylvania, 368 US 71; JPMorgan Chase Bank, N.A. v Motorola, Inc., 47 AD3d 293; Harris v Balk, 198 US 215.)
   OPINION OF THE COURT

Rivera, J.

Two questions certified to us by the United States Court of Appeals for the Second Circuit raise issues as to whether a judgment creditor can obtain a CPLR article 52 turnover order against a bank to garnish assets held by the bank’s foreign subsidiary. We hold that for a court to issue a postjudgment turnover order pursuant to CPLR 5225 (b) against a banking entity, that entity itself must have actual, not merely constructive, possession or custody of the assets sought. That is, it is not enough that the banking entity’s subsidiary might have possession or custody of a judgment debtor’s assets.

In 1994, plaintiff, the Commonwealth of the Northern Mariana Islands (the Commonwealth), obtained two separate tax judgments in the United States District Court for the Northern Mariana Islands against William and Patricia Millard (the Millards) for unpaid taxes in the respective amounts of $18,317,980.80 and $18,318,113.41. The Millards, who had previously resided in the Commonwealth since 1987, relocated before the Commonwealth was able to obtain the judgments.

In March and April 2011, the Commonwealth registered the tax judgments in the United States District Court for the Southern District of New York and commenced proceedings as a judgment creditor, pursuant to Federal Rules of Civil Procedure rule 69 (a) (1) and CPLR 5225 (b), seeking a turnover order against garnishees holding assets of the Millards. As relevant here, the Commonwealth named Canadian Imperial Bank of Commerce (CIBC), a Canadian bank headquartered in Toronto, with a branch in New York, as a garnishee under the theory that the Millards maintained accounts in subsidiaries of CIBC, namely, CIBC FirstCaribbean International Bank Limited (CFIB) or CFIB’s affiliates in the Cayman Islands. According to the Commonwealth, CFIB is a 92% owned-and-controlled direct subsidiary of CIBC.

The Commonwealth moved, by order to show cause, for a turnover order against CIBC and a preliminary injunction, on the ground that “CIBC has the control, power, authority and practical ability to order [CFIB] to turn over funds on deposit in the name of the Millards.” In support, the Commonwealth referred to the 92% ownership of CFIB, and other indicia of control, asserting that CIBC imposed a governance structure upon CFIB that “affords the parent company full oversight of the risk and control framework of all [of CFIB’s] operations.” The Commonwealth further argued that the overlap in significant personnel, and CIBC’s oversight of CFIB’s compliance with various legal requirements, such as the Sarbanes-Oxley Act, demonstrated CIBC’s ability to exert actual, practical control over CFIB’s operations. In opposition, CIBC contended that CFIB is a “legally separate and independent entit[y]” and that, absent an information sharing agreement, “CIBC is unable to access accounts or account information held by [CFIB] or its subsidiaries.”

The District Court denied the motion and maintained a previously issued restraining order that precluded CIBC from engaging in certain activity related to the Millards’ accounts. While the District Court found the Commonwealth’s “practical ability to control” argument colorable, it observed that the scope of the phrase “possession or custody,” contained in CPLR 5225 (b), was an issue suited for this Court’s consideration.

Upon appeal, the Second Circuit determined that for the reasons set forth in the District Court’s opinion, the resolution of the case turned on unresolved issues of New York law, and certified the following questions to this Court:

“1. May a court issue a turnover order pursuant to N.Y. C.P.L.R. § 5225(b) to an entity that does not have actual possession or custody of a debtor’s assets, but whose subsidiary might have possession or custody of such assets?
“2. If the answer to the above question is in the affirmative, what factual considerations should a court take into account in determining whether the issuance of such an order is permissible?” (693 F3d 274, 275 [2d Cir 2012]).

We accepted the certified questions and now answer the first in the negative, and as a consequence refrain from answering the second as academic.

Under CPLR article 52, a special proceeding for a turnover order is the procedural mechanism devised by the legislature to enforce a judgment against an asset of a judgment debtor, held in the “possession or custody” of a third party. Section 5225 (b) provides, in pertinent part:

“Upon a special proceeding commenced by the judgment creditor, against a person in possession or custody of money or other personal property in which the judgment debtor has an interest, or against a person who is a transferee of money or other personal property from the judgment debtor, where it is shown that the judgment debtor is entitled to the possession of such property or that the judgment creditor’s rights to the property are superior to those of the transferee, the court shall require such person to pay the money, or so much of it as is sufficient to satisfy the judgment, to the judgment creditor and, if the amount to be so paid is insufficient to satisfy the judgment, to deliver any other personal property, or so much of it as is of sufficient value to satisfy the judgment, to a designated sheriff.”

The Commonwealth contends that the phrase “possession or custody” inherently encompasses the concept of control, and, therefore, section 5225 (b) is applicable to garnishees with constructive possession of a judgment debtor’s assets. As such, the Commonwealth proposes that an actual, practical control test—i.e., whether the bank could practically order its subsidiary to turn over the assets of the judgment debtor—should be adopted by this Court as the appropriate standard. We find the Commonwealth’s interpretation of section 5225 (b) unpersuasive for the reasons that follow.

In determining the expanse of section 5225 (b) our “starting point” is “the language itself, giving effect to the plain meaning thereof” (Majewski v Broadalbin-Perth Cent. School Dist., 91 NY2d 577, 583 [1998]). “[W]here the statutory language is clear and unambiguous, the court should construe it so as to give effect to the plain meaning of the words used” (Patrolmen’s Benevolent Assn. of City of N.Y. v City of New York, 41 NY2d 205, 208 [1976], citing Bender v Jamaica Hosp., 40 NY2d 560 [1976]). Moreover, “[i]t is fundamental that a court, in interpreting a statute, should attempt to effectuate the intent of the Legislature” (Majewski, 91 NY2d at 583, citing Patrolmen’s Benevolent Assn., 41 NY2d at 208).

The plain language of section 5225 (b) refers only to “possession or custody,” excluding any reference to “control.” The absence of this word is meaningful and intentional as we have previously observed that the failure of the legislature to include a term in a statute is a significant indication that its exclusion was intended (see People v Finnegan, 85 NY2d 53, 58 [1995] [“We have firmly held that the failure of the Legislature to include a substantive, significant prescription in a statute is a strong indication that its exclusion was intended”]; Pajak v Pajak, 56 NY2d 394, 397 [1982] [“The failure of the Legislature to provide that mental illness is a valid defense in an action for divorce based upon the ground of cruel and inhuman treatment must be viewed as a matter of legislative design. Any other construction of the statute would amount to judicial legislation”]; see also McKinney’s Cons Laws of NY, Book 1, Statutes § 74). Accordingly, we interpret the omission of “control” from section 5225 (b) as an indication that “possession or custody” requires actual possession.

The language of the predecessor statute to section 5225 (b) and the legislation enacting the CPLR lend additional support to the view that “possession or . custody” does not include constructive possession. Prior to the 1962 legislation enacting the CPLR, the relevant turnover statutes referred to “possession” and “control” and made no mention of custody (see Civil Practice Act §§ 793, 796). Civil Practice Act § 796, the predecessor statute to section 5225 (b), provided in relevant part that

“[w]here it appears from the examination or testimony taken in a special proceeding authorized by this article that the judgment debtor has in his possession or under his control money or other personal property belonging to him, or that money or one or more articles of personal property capable of delivery, his right to the possession whereof is not substantially disputed, are in the possession or under the control of another person, the court in its discretion and upon such a notice given to such persons as it deems just, or without notice, may make an order directing the judgment debtor or other person immediately to pay the money or deliver the articles of personal property to a sheriff designated in the order.”

Section 5225 (b) and other related provisions were enacted to include the “possession or custody” language, thus making a clear distinction between the prior references to “possession” and “control.” It is a well settled tenet of statutory construction that “[t]he Legislature, by enacting an amendment of a statute changing the language thereof, is deemed to have intended a material change in the law” (McKinney’s Cons Laws of NY, Book 1, Statutes § 193). The exclusion of the word “control” signaled a purposeful legislative modification of the applicable scope of turnover statutes. The Commonwealth would have us construe section 5225 (b) to include that term, but “[a] court cannot by implication supply in a statute a provision which it is reasonable to suppose the Legislature intended intentionally to omit” because “the failure of the Legislature to include a matter within the scope of an act may be construed as an indication that its exclusion was intended” (McKinney’s Cons Laws of NY, Book 1, Statutes § 74). In other words, we cannot read into the statute that which was specifically omitted by the legislature.

The Commonwealth argues that the legislature simply substituted “custody” as the functional equivalent of “control.” However, we read the statute both based on its plain meaning and in context, and it is clear that the legislature did not pen one word anticipating that another would be “read into” the CPLR. When the legislature has sought to encompass the concept of “control” it has done so explicitly, evincing a legislative intent to exclude consideration of “control” from those sections from which it is omitted. For example, CPLR 3111, which concerns the production of discovery materials, provides that “books, papers and other things in the possession, custody or control of the person to be examined” should be produced. CPLR 3119 (a) (4) (ii) similarly provides that a subpoena may be used to order a person to produce discovery “in the possession, custody or control of the person” (see also CPLR 2701, 3120, 3122-a, 5224). We are led to the conclusion that the legislature considered “control” and “custody” to refer to distinct concepts (see People v Elmer, 19 NY3d 501, 507 [2012] [observing that the legislature is presumed to know the distinction between terms used in legislation]; Easley v New York State Thruway Auth., 1 NY2d 374, 379 [1956] [“Legislatures are presumed to know what statutes are on the books and what is intended by constitutional amendments approved by the Legislature itself”]; McKinney’s Cons Laws of NY, Book 1, Statutes § 222).

As these sections of the CPLR indicate, in a documentary discovery context, with expansive rules of disclosure, it is reasonable to conclude that the legislature would employ a broader “possession, custody or control” standard. Indeed, various courts have interpreted “possession, custody or control” to allow for discovery from parties that had practical ability to request from, or influence, another party with the desired discovery documents. As such, courts have interpreted “possession, custody or control” to mean constructive possession (see Bank of New York v Meridien BIAO Bank Tanzania Ltd., 171 FRD 135, 146 [SD NY 1997] [“ '(C)ontrol’ does not require that the party have legal ownership or actual physical possession of the documents at issue; rather, documents are considered to be under a party’s control when that party has the right, authority, or practical ability to obtain the documents from a non-party to the action”]; see also In re NASDAQ Market-Makers Antitrust Litig., 169 FRD 493, 530 [SD NY 1996]).

Consequently, because “possession, custody or control” has been construed to encompass constructive possession, then, by contrast, legislative use of the phrase “possession or custody” contemplates actual possession. Notably, sections of the CPLE pertaining to the disposition of property utilize the narrower “possession or custody” standard. For example, CPLE 1320, which concerns the attachment or levy of personal property, is limited to property “in the defendant’s possession or custody.” CPLE 6214 and 6215 similarly limit the levy of personal property to items within the “possession or custody” of the defendant (see also CPLR 1321, 1325, 2701, 5222, 5225, 5232, 5250, 6219). This distinction supports the view that the legislature has applied a higher standard to insure the proper disposition of property (see CPLR 5209; JPMorgan Chase Bank, N.A. v Motorola, Inc., 47 AD3d 293 [1st Dept 2007]).

The Commonwealth argues that this distinction is of no moment, speculating that the legislature blindly duplicated the standards of the Federal Eules of Evidence when enacting the CPLE. However, "[w]hen different terms are used in various parts of a statute or rule, it is reasonable to assume that a distinction between them is intended” (Matter of Albano v Kirby, 36 NY2d 526, 530 [1975]). Consequently, the distinction cannot be simply disregarded, and this Court is required to construe the entire CPLE in a manner that harmonizes these variations (see McKinney’s Cons Laws of NY, Book 1, Statutes §§ 97, 98). In light of these differences, the most reasonable way to interpret these provisions is to conclude that “possession, custody or control” contemplates constructive possession, whereas “possession or custody,” by its omission of the term “control,” refers to actual possession. Accordingly, a section 5225 (b) turnover order cannot be issued against a garnishee lacking actual possession or custody of a judgment debtor’s assets or property.

Finally, our decision in Koehler v Bank of Bermuda Ltd. (12 NY3d 533 [2009]) does not require a different reading of section 5225 (b). In that case, we addressed whether, under CPLR article 52, a New York court could order a bank over which it had personal jurisdiction to deliver out-of-state stock certificates to a judgment creditor. The Court noted that unlike prejudgment attachment, which requires jurisdiction over property, “postjudgment enforcement requires only jurisdiction over persons” (12 NY3d at 537). As such, “CPLR 5225 (b) applies when the property is not in the judgment debtor’s possession” and “ contemplate [s] an order, directed at a defendant who is amenable to the personal jurisdiction of the court, requiring him to pay money or deliver property” (id. at 541). Accordingly, “a New York court with personal jurisdiction over a defendant may order him [or her] to turn over out-of-state property regardless of whether the defendant is a judgment debtor or a garnishee” (id.).

Notably, Koehler does not interpret the meaning of the phrase “possession or custody,” and is only significant in holding that personal jurisdiction is the linchpin of authority under section 5225 (b) (see also Hotel 71 Mezz Lender LLC v Falor, 14 NY3d 303, 312 [2010]). Indeed, many cases have held that a turnover order is given effect through a court’s exercise of personal jurisdiction over a party. Thus, in Starbare II Partners v Sloan (216 AD2d 238 [1st Dept 1995]), albeit a section 5225 (a) case, the New York court had the authority to order a judgment debtor to turn over paintings he owned, but stored in New Jersey. In Miller v Doniger (28 AD3d 405 [1st Dept 2006]), the judgment debtor, who was in New York, was directed to turn over his out-of-state Wachovia bank accounts to the judgment creditor. Similarly, in Gryphon Dom. VI, LLC v APP Intl. Fin. Co., B.V. (41 AD3d 25 [1st Dept 2007]), the Appellate Division observed that “a turnover order merely directs a defendant, over whom the New York court has jurisdiction, to bring its own property into New York” (41 AD3d at 31). Thus, “[h]aving acquired jurisdiction of the person, the court [ ] can compel observance of its decrees by proceedings in personam against the owner within the jurisdiction” (Koehler, 12 NY3d at 539). However, in these cases, the garnishee was directed to deliver assets already within its possession. No case supports the Commonwealth’s attempt to broadly construe Koehler and require that a garnishee be compelled to direct another entity, which is not subject to this state’s personal jurisdiction, to deliver assets held in a foreign jurisdiction. Such an expansion is inconsistent with the plain language and scope of section 5225 (b).

Accordingly, certified question No. 1 should be answered in the negative and certified question No. 2 not answered as academic.

Chief Judge Lippman and Judges Graffeo, Read, Smith and Pigott concur.

Following certification of questions by the United States Court of Appeals for the Second Circuit and acceptance of the questions by this Court pursuant to section 500.27 of the Rules of Practice of the New York State 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 No. 1 answered in the negative and certified question No. 2 not answered as academic.

      . In 2010, the Commonwealth learned that the Millards had renounced their United States citizenship and resided in the Cayman Islands.

      . The Commonwealth also registered the judgments in the United States District Court for the Southern District of Florida.

      . On appeal CIBC contends that the Commonwealth incorrectly moved pursuant to CPLR 5225 (b) rather than CPLR 5227, arguing that the latter is the applicable section to turnover orders involving bank deposits as the “debt” owed by the bank to the customer. We have no cause to address the applicability of section 5227, and limit our analysis to the issues concerning CPLR 5225 (b) presented by the Second Circuit’s certification to this Court.


text:
    [990 NE2d 121, 967 NYS2d 883]
    Verizon New England, Inc., Appellant, v Transcom Enhanced Services, Inc., Respondent.
    Argued March 20, 2013;
    decided May 2, 2013

      POINTS OF COUNSEL

      Gibson, Dunn & Crutcher LLP, New York City (Robert L. Weigel, Jason W. Myatt and Anne M. Coyle of counsel), for appellant.
    I. Global NAPs, Inc.’s rights in its undisputed contract with Transcom Enhanced Services, Inc. are property of the judgment debtor in Transcom’s possession. (ABKCO Indus. v Apple Films, 39 NY2d 670; Matter of Supreme Mdse. Co. v Chemical Bank, 70 NY2d 344.) II. The majority opinion of the Appellate Division is contrary to the public policy embodied in CPLR 5222. (ABKCO Indus. v Apple Films, 39 NY2d 670; Matter of Supreme Mdse. Co. v Chemical Bank, 70 NY2d 344.) III. Respondent’s violation of the restraining notice entitles Verizon New England, Inc. to damages. (Ray v Jama Prods., 74 AD2d 845; Conde v Anton Adj. Co., 133 Misc 2d 998; Syndicate Bldg. Corp. v City Univ. of N.Y., 159 Misc 2d 898; Mazzuka v Bank of N. Am., 53 Misc 2d 1053; Aspen Indus. v Marine Midland Bank, 52 NY2d 575.)

      Arent Fox LLP, New York City (Hunter T. Carter and Matthew S. Trokenheim of counsel), for respondent.
    I. The Supreme Court correctly denied turnover, dismissed the petition with prejudice, vacated any and all restraints, and denied Verizon New England, Inc.’s application to hold Transcom Enhanced Services, Inc. in contempt. (ABKCO Indus. v Apple Films, 39 NY2d 670; Clarkson Co. Ltd. v Shaheen, 533 F Supp 905; Matter of Supreme Mdse. Co. v Chemical Bank, 70 NY2d 344; Gala Enters., Inc. v Hewlett Packard Co., 970 F Supp 212; State Bank

      v Central Mercantile Bank, 248 NY 428; Macklowe v 42nd St. Dev. Corp., 170 AD2d 388; Verizon New England Inc. v IDT Dom. Telecom, Inc., 98 AD3d 838; Conde v Anton Adj. Co., 133 Misc 2d 998; Zemo Leasing Corp. v Bank of N.Y., 158 Misc 2d 991.) II. Public policy concerns do not favor imposing a restraint even though the garnishee has no obligation to the judgment debtor. (ABKCO Indus. v Apple Films, 39 NY2d 670.) III. Verizon New England, Inc. suffered no damages as a result of Transcom Enhanced Services, Inc. purchasing services from Global NAPS, Inc. IV The appeal must be dismissed because Verizon New England, Inc. failed to settle the transcript of the proceeding. (Matter of Baiko v Baiko, 141 AD2d 635; Matter of Zullo v Hom, 22 AD3d 675; Matter of Robinson v Fisher, 275 AD2d 326; Perry v Tauro, 21 AD2d 804.)
   OPINION OF THE COURT

Rivera, J.

In this appeal, we consider whether an at-will, prepayment service agreement, which lacks any obligation to continue services or a commitment to engage in future dealings, constitutes a property interest or debt subject to a CPLR 5222 (b) restraining notice. We conclude, based on the nature of the agreement, that the restraining notice is unenforceable and, therefore, affirm the Appellate Division order.

This case arises from efforts by Verizon New England, Inc. (Verizon) to collect a $57,716,714 judgment awarded in January 2009 by the United States District Court for the District of Massachusetts against, inter alia, Global NAPs, Inc. (GNAPs) (see Global NAPs, Inc. v Verizon New England Inc., 603 F3d 71 [1st Cir 2010], cert denied 562 US —, 131 S Ct 1044 [2011]). On March 6, 2009, Verizon domesticated the judgment.

In its attempt to enforce the judgment, on April 2, 2009, Verizon served a restraining notice and information subpoena on GNAPs and companies with which it did business, one of which was Transcom Enhanced Services, Inc. (Transcom). The restraining notice directed Transcom not “to make or suffer any sale, assignment or transfer of, or interference with, any property in your possession in which [GNAPs] . . . has an interest.” Verizon further directed Transcom to “[i]dentify any and all transactions, contracts, or agreements entered into” with GNAPs, and “identify the parties to the transaction; the date of the transaction; the amount of the transaction . . . and the goods and services that are the subject of the transaction.” Verizon also requested that Transcom “[identify all receivables . . . or any other outstanding obligation owed by you” to GNAPs.

In February 2010, Transcom responded to the questions of the information subpoena. It identified a telephone switch service agreement dated October 21, 2003, that it had entered into with GNAPs. The agreement required a monthly recurring payment of $28,000 per circuit for eight circuits, plus an additional $57,000 per month for additional charges for local origination and termination services. As to “any receivables and outstanding obligations owed” to GNAPs, Transcom responded: “None. All payments are made in advance or contemporaneously with service.” Additionally, Transcom annexed a Vendor Balance Detail (VBD), which listed payments made to GNAPs. The VBD reflected that on the day prior to receiving the restraining notice, Transcom received a $246,000 bill from GNAPs, which was paid by four checks issued April 1, 6, 15 and 21, each in the amount of $61,500. The VBD included the bills and payments through November 2009.

In March 2010, Verizon commenced this special proceeding seeking, inter alia, a turnover of property and debts of the judgment debtor held by Transcom, a judgment equal to the amount paid by Transcom to the judgment debtors in violation of the restraining notice, which amounted to $2,454,250, and a finding of civil contempt. Verizon based its claim upon the 2003 agreement between Transcom and GNAPs, which Verizon alleged created an ongoing contractual relationship requiring Transcom to pay GNAPs $281,000 per month. Transcom asserted that it did not violate the restraining notice because the GNAPs invoices predated services, and Transcom was under no obligation to accept those services. Thus, it did not owe any debt to GNAPs, and it did not hold property in which GNAPs had any interest.

During the proceedings, Transcom presented testimony that it had a week to week arrangement with GNAPs that allowed Transcom to decide weekly whether to engage GNAPs for services. Various Transcom witnesses testified that GNAPs sent monthly invoices for proposed services to be rendered the following month, and Transcom prepaid for services each week, rather than paying monthly for services rendered by GNAPs as provided by the 2003 contract.

Supreme Court, inter alia, denied turnover and dismissed the petition with prejudice (27 Misc 3d 1236[A], 2010 NY Slip Op 51073[U] [2010]). The court credited the testimony given by Transcom’s executive officers and concluded “that there is no property or debt in the instant matter subject to a restraining order, levy or turnover pursuant to Article 52 of the CPLR” (2010 NY Slip Op 51073[U], *4). Verizon appealed.

In a 3-2 decision, the Appellate Division affirmed the judgment (98 AD3d 203 [1st Dept 2012]). The majority recognized “that a restraining notice is effective only if, at the time of service, the third party on whom the notice is served owes a debt to, or is in possession of property of, the judgment debtor” (id. at 204). However, the majority went on to observe that Transcom “owed no debt, but rather held a credit balance with GNAP[s] [and] the undisputed modified agreement between [the parties] dispensed with any contractual obligations or ‘bundle of rights’ that could be considered attachable property” (id. at 207). The two-Justice dissent concluded that GNAPs “had a ‘future interest’ in payments from Transcom that constituted property . . . which was subject to restraint” (id. at 217). Verizon appeals to this Court pursuant to CPLR 5601 (a).

A party seeking to enforce a judgment may seek to restrain or prohibit the transfer of a judgment debtor’s property in the hands of a third party pursuant to CPLR 5222 (b). Section 5222 (b) states in relevant part,

“A restraining notice served upon a person other than the judgment debtor or obligor is effective only if, at the time of service, he or she owes a debt to the judgment debtor or obligor or he or she is in the possession or custody of property in which he or she knows or has reason to believe the judgment debtor or obligor has an interest ... or that the judgment debtor or obligor has an interest in specified property in the possession or custody of the person served” (emphasis added).

All such property or debt which thereafter comes into the possession or custody of such person is subject to the restraining notice (see id.). Section 5201 (a) and (b) provide that “[a] money judgment may be enforced against any debt, which is past due or which is yet to become due,” or “any property which could be assigned or transferred, whether it consists of a present or future right or interest and whether or not it is vested.”

The Appellate Division here affirmed the Supreme Court’s findings of fact, which are supported by the record (see Arthur Karger, Powers of the New York Court of Appeals § 13:10 at 489 [3d ed rev 2005] [facts affirmed by the Appellate Division with evidentiary support are “conclusive and binding on the Court”]). The affirmed findings established that Transcom prepaid for its service, and as such, there was no debt past due or yet to become due under the definition of CPLR 5201 (a). The only remaining issue is whether Transcom’s oral agreement with GNAPs is an attachable property interest subject to restraint.

In ABKCO Indus. v Apple Films (39 NY2d 670 [1976]), we recognized that a contractual agreement could constitute contingent property interests attachable and assignable, and thus subject to CPLR 5201 (b) and article 62 of the CPLR. In that case, this Court held a licensing agreement entered into between a foreign debtor and a third party was an attachable interest because the licensing agreement, whereby the third party agreed to pay the debtor 80% of the net profits received from the promotion of a film, was deemed property (see id.). Verizon argues that the prepayment service agreement between Transcom and GNAPs fits squarely within our analysis in ABKCO, and created the type of property interests amenable to a restraining notice in accordance with CPLR 5201 (b) and consequently CPLR 5222.

We disagree. The agreement in this case is wholly distinguishable from the agreement in ABKCO and, thus, cannot be deemed an attachable or assignable property interest. In ABKCO the agreement set forth an obligation to pay the debtor, which constituted the “principal feature of economic significance” of the agreement (id. at 674). Here, when Transcom received the restraining notice it had an oral agreement that if Transcom paid GNAPs, GNAPs would provide one week’s worth of services. This agreement was terminable at will, at any time, without prior notice, meaning that Transcom had no obligation after receiving one week’s worth of services to engage GNAPs for another week’s worth of services. Moreover, not only could Transcom unilaterally eliminate any possibility of future revenue from the contract, but so could GNAPs. In sum, the parties had no continuing contractual obligation to each other. Thus, each week, Transcom had no obligation to pay GNAPs. Accordingly, there was no debt, and no obligation “certain to become due” (id. at 675, citing Glassman v Hyder, 23 NY2d 354, 359 [1968]).

Thus, because Transcom prepaid for services to be provided by GNAPs on a week-to-week basis, without any commitment or promise for additional services, or any assurance of a continued purchase of services, Transcom neither owed any debt to, nor possessed any property of, GNAPs that could be subject to a restraining notice. Similarly, because Transcom’s payments to GNAPs constitute neither a debt nor a present or future property interest, CPLR 5201 (a) and (b) are not applicable.

Verizon makes much of the fact that Transcom has continued its relationship and has never terminated the agreement. In essence, Verizon argues that the agreement is automatic and Transcom and GNAPs expect continuation. The Appellate Division dissent also maintained that Transcom and GNAPs had “a highly regular and predictable business relationship” where it was reasonably certain that GNAPs would “continue to generate revenues” (98 AD3d 203, 216 [1st Dept 2012]). However, any arguments based on a characterization of the facts are unavailable to us given the Appellate Division’s affirmance of the findings of fact. Moreover, the expectation of any continued or future business is too contingent in nature and speculative to create a present or future property interest. Although property is often described as a “bundle of rights,” or “sticks,” with relational aspects (see generally J.E. Penner, The “Bundle of Rights” Picture of Property, 43 UCLA L Rev 711, 712-713 [Feb. 1996]), here, the payment before the receipt of service and the ability to terminate the relationship at any time without penalty, cannot support a finding that a transferrable property right existed (see generally Matter of Supreme Mdse. Co. v Chemical Bank, 70 NY2d 344 [1987] [where the Court held an executory negotiable letter of credit is not property for purposes of attachment by a party in an unrelated litigation]). Moreover, the voluntary payments in this case are distinguishable from ABKCO where the potential for future obligatory payments provided some real basis for a property interest. Therefore, unlike ABKCO, there is no restrainable interest akin to the “collection of individual rights which, in certain combinations, constitute property” (United States v Craft, 535 US 274, 278 [2002]).

Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Lippman and Judges Graffeo, Read, Smith and Pigott concur.

Order affirmed, with costs.