Help, I Need to Get My Case into the Commercial Division!! Transfer and Determinations by the Administrative Judge
April 05, 2024
As one can easily glean, we here at the New York Commercial Division Practice Blog view New York’s Commercial Division as the heartbeat of business litigation in the United States. So, we think getting your business litigation in front of the Commercial Division is a big deal. But what happens when you have a case that meets the requirements for the Commercial Division, and you are not assigned to that Part?
Generally, there are two ways to be assigned to the Commercial Division under § 202.70[d] of the New York Code of Rules and Regulation (the “Rules”). The first is for any party to file an RJI with the accompanying Commercial Division Addendum 90 days following service of the complaint. The second is by consent of the parties via a forum – selection clause in the parties’ contract.
But what if a party files an RJI before the 90-day period runs without requesting assignment or submitting a Commercial Division Addendum? The answer lies in § 202.70[e] of the Rules, which permits a party to apply via letter to the Administrative Judge within 10 days of the RJI for transfer to the Commercial Division.
But what if the request is made outside the time limits in § 202.70[d] and [e] of the Rules? Again, § 202.70[e] of the Rules permits a letter application to the Administrative Judge showing “good cause” for the delay.
While the timing provisions are relatively simple to work though, the “good cause” standard under CPLR 2004, which requires reasoning for the delay, is a bit more subjective, as a finding of good cause is within the discretion of the Administrative Judge. It is imperative, therefore, to point the Administrative Judge to applications with analogous issues or facts to support your cause. As for where to find those decisions, never fear, the Commercial Division itself provides some help in this regard.
On the New York Courts webpage, the Commercial Division has a page titled Administrative Judge on Transfer Applications. That page provides a list of all the Administrative Judge’s decisions on transfer applications from prior to the effective date of the Commercial Division Rules on January 17, 2006, to the present.
For example, what if a timely request for Commercial Division assignment was not filed, but you have a related case pending before a Commercial Division Judge? The Administrative Order in ABG HMX LLC v. Alba Longa Concepts LLC provides precedent for the Administrative Judge granting a transfer for “good cause”, in this context. And what if a request for Commercial Division assignment is rejected by the clerk’s office but was only a few days late? Curtis v. Merrill Lynch, et al provides precedent for the Administrative Judge granting a transfer if the request was “untimely albeit only by a matter of days.” But waiting years before filing a transfer application is not wise. In ABL Advisor LLC, et al. v. Ian S. Peck, et al, the Administrative Judge denied a transfer application made two years into the litigation, finding that the “rules are designed to ensure that appropriate cases are assigned to the Commercial Division at the inception of the case, not two years into the litigation.” Finally, what if you have a complex commercial case but one of the issues is arguably excluded from review by the Commercial Division? In City of New York v. FC 42nd Street Associates, L.P., the Administrative Judge granted transfer of a generally excluded real property case that dealt with the determination of fair market value in relation to rental income, agreeing that while the case “is not an action for the payment of rent only, … the complaint raises complex questions of commercial and arbitration law and belongs in the Commercial Division.” And there are many more helpful examples for litigators on the Commercial Division’s “Transfer Application” page.
In short, the next time you find yourself in a position where leave to the Administrative Judge is required for assignment to the Commercial Division, remember the Commercial Division and its readily available resources has you covered.