BILL NUMBER:S5076                REVISED MEMO 01/27/2014

TITLE OF BILL:  An act to amend the civil practice law and rules, in
relation to the scope of review of non-final judgments and orders

This is one in a series of measures being introduced at the request of
the Chief Administrative Judge upon the recommendation of her Advisory
Committee on Civil Practice.

This measure would add a new subdivision (e) to CPLR § 5501 in relation
to the scope of review of non-final judgment and orders. It also would
permit appellate review of a non-final judgment or order that does not
"necessarily affect" a final judgment.

This measure is designed to address two problems that arise under
current law. First, there is substantial confusion in the case law as to
what non-final judgments "necessarily affect" a final judgment.  This
matter was most recently illustrated by the Court of Appeals' decision
in Oakes v Patel, 20 N.Y.3d 633 (2013) where the Court acknowledged that
its rulings as to what "necessarily affects" the judgment "may not all
be consistent" (Id. at 644) and, in particular, with regard to orders
granting or denying the amendment of pleadings, the application of the
rule has been "particularly vexing." Adding to the problem, the Court in
Oakes overruled cases setting a bright-line standard that orders relat-
ing to amendments of pleadings were never orders necessarily affecting a
final judgment, leaving the issue to be decided on a case-by-case basis.
              

Id.

This uncertainty in the case law is amply illustrated by two recent
articles in the New York Law Journal (see, Thomas R. Newman and Steven
J. Ahmuty, Jr., The 'Necessarily Affects' Requirement of CPLR 5501
(NYLJ, Nov. 8, 2012); Thomas F. Gleason, Dangerous Interactions:  Inter-
locutory Appeals and Judgments (NYLJ, Nov. 19, 2012)).

Under current law, a careful litigant will take an interlocutory appeal
of any order where there is a question as to whether that order neces-
sarily affects the final judgment. This is true even in cases where it
might be more prudent to await the final judgment before taking the
appeal, either because the matter will ultimately become moot or because
the issue will be more fully developed and would be better understood by
the appellate court when the appeal is taken into context of a final
order.  Nonetheless, the uncertainty underlying what necessarily affects
the final judgment prevents the careful litigant from waiting with
regard to any such appeal. With this change, parties would preserve the
right to appeal all interlocutory orders until appeal from the final
judgment.

Eliminating the requirement that an appeal necessarily affect the final
judgment would not increase the work load of the appellate court.
Indeed, it may well reduce the number of interlocutory appeals since
litigants will not be compelled to file an interlocutory appeal on
matters that do not or may not affect the final judgment. Once the final

judgment is entered, that appeal could become moot or of little conse-
quence and therefore would no longer require the involvement of the
appellate court.

The second problem is the result of the Court of Appeals' decision in
Matter of Aho, 39 N.Y.2d 241 (1976), in which the court held that an
appeal from an interlocutory order immediately terminates with the entry
of a final judgment. In certain circumstances, this can eliminate a
party's right to appellate review where the non-final order does not
"necessarily affect" the final judgment. For example, an order imposing
sanctions on an attorney or litigant would not necessarily affect the
final judgment, so it would not be subject to review in the context of
an appeal from the final judgment. Likewise, an order dismissing a
cross-claim or third-party claim for indemnification may not necessarily
affect the final judgment and such an appeal would terminate upon final
judgment in favor of the plaintiff. Thus, even if an appeal from such an
order had been fully briefed and argued, but not decided, at the time of
the entry of judgment, appellate review would be foreclosed. Even in the
case where the order appealed from necessarily affects the final judg-
ment, the party's appeal would terminate upon entry of judgment, result-
ing in a tremendous waste of the party's and the court's resources.

This measure would have no fiscal impact on the State. It would take
effect immediately and apply to all actions pending on such effective
date or commenced on or after such effective date.

2013 Legislative History:

                    OCA 2013-48
                    Senate 5076 (Sen. Bonacic) (ref to judiciary)

2012 Legislative History:

                    OCA 2012-60
                    Senate 6648 (Sen. Bonacic) (ref to Judiciary)