Innovation Becomes the Norm: Commercial Division Rules Shape Revised Uniform Rules for the Supreme Court and County Court
January 18, 2021
The New York Commercial Division was created in 1993 “to test whether it would be possible, by concentrating on commercial litigation, to improve the efficiency with which such matters were addressed by the court and, at the same time, to enhance the quality of judicial treatment of those cases.” By implementing rules and procedures developed with efficiency in mind and after careful consultation with Judges and practitioners alike, the Commercial Division has become a resounding success; it is one of the most efficient and effective forums in the world for the litigation of complex civil disputes.
It should therefore come as no surprise that other New York courts have taken notice of the innovative rule changes contributing to the success of the Commercial Division. As Chief Administrative Judge Marks observes: “through the work of the Commercial Division Advisory Council – a committee of commercial practitioners, corporate in-house counsel and jurists devoted to the Division’ s excellence – the Commercial Division has functioned as an incubator, becoming a recognized leader in court system innovation, and demonstrating an unparalleled creativity and flexibility in development of rules and practices.”
Now, by Administrative Order effective February 1, 2021, the Uniform Civil Rules for the Supreme Court (the “Uniform Rules”) will incorporate, in whole or in part, nearly 30 Commercial Division Rules. Some of these changes were foreshadowed by my colleague Paige Bartholomew in 2018 when the Unified Court System’s Advisory Committee on Civil Practice requested public comment on whether to adopt nine of the Commercial Division’s Rules.
For commercial division practitioners who sometimes find themselves in the general part, expansion of these rules is a welcome step toward improving the efficiency of the New York Courts. Some highlights:
Appearance by Counsel with Knowledge and Authority; Strict Adherence to Discovery Schedule
A routine court appearance is not what it once was, and gone are the days where law firms can send one lawyer to court to cover the entire firm’s conferences and appearances for the day. Revised Uniform Rule 202.1 incorporates Commercial Division Rule 1’s requirement that “Counsel who appear before court must be familiar with the case with regard to which they appear and be fully prepared and authorized to discuss and resolve the issues which are scheduled to be the subject of the appearance.”
As commercial division practitioners surely have grown aware: courts are not interested in perfunctory appearances. Revised Uniform Rule 202.1 means that counsel appearing for any conference should be prepared for a deep dive into settlement, mediation, ESI, argument on any ripe discovery disputes, and discussion of pending or forthcoming motions.
By the same token, setting a discovery schedule in the general part once meant selecting placeholder dates that all sides knew would never hold up. Not anymore. New Uniform Rule 202.20-e adopts Commercial Division Rule 13’s mandate that the “Parties shall strictly comply with discovery obligations by the dates set forth in all case scheduling orders. Applications for extension of a discovery deadline shall be made as soon as practicable and prior to the expiration of such deadline. Non-compliance with such an order may result in the imposition of an appropriate sanction against that party pursuant to CPLR 3126.”
Borrowing from the local rules of the Southern District of New York, Commercial Division Rule 11-a limits interrogatories in both number—no more than 25, including subparts—and substance—to “the [i] name of witnesses with knowledge of information material and necessary to the subject matter of the action, [ii] computation of each category of damage alleged, and the [iii] existence, custodian, location and general description of material and necessary documents.”
New Uniform Rule 202.20 adopts part of this limitation, providing that “Interrogatories are limited to 25 in number, including subparts, unless the court orders otherwise.” And although this new limitation does not by its terms apply to requests for particulars, practitioners would be wise to consider what effect, if any, New Uniform Rule 202.20 has on lengthy requests for bills of particulars. Commercial division judges have cited Rule 11-a as a reason to similarly limit requests for bills of particulars. See Orentreich v John B. Murray Architect, LLC, 2020 NY Slip Op. 32944(U). Judges in the general part may be similarly inclined.
Say goodbye to 4-day depositions. New Uniform Rule 202.20-b incorporates Commercial Division Rule 11-d, which imposes two significant limitations: “[u]nless otherwise stipulated to by the parties or ordered by the court: (1) the number of depositions taken by plaintiffs, or by defendants, or by third-party defendants, shall be limited to 10; and (2) depositions shall be limited to 7 hours per deponent.”
Commercial division judges have been reluctant to modify these rules, see Gottwald v Sebert, 2017 NY Slip OP 31797(U) (finding egregious misconduct at deposition was a prerequisite to another seven hours). Expect general part judges to be equally reluctant.
In 2014, the Commercial Division enacted Rule 11-b governing a party’s obligation to produce a log of documents withheld on the basis of privilege. The Commercial Division substantially streamlined the privilege log process by encouraging parties, “where appropriate,” to exchange categorical privilege logs, rather than document-by-document logs. Rule 11-b instructs the parties to meet-and-confer over the issue, and the parties may use “any reasoned method of organizing the documents” into categories, which are to be provided to the requesting party in lieu of a document-by-document log.
New Uniform Rule 202.20-a adopts Commercial Division Rule 11-b’s requirement that the parties meet and confer regarding privilege logs, and that such discussion include consideration of categorical privilege logs. Although New Uniform Rule 202.20-a does not expressly adopt the Commercial Division’s stated preference for categorical privilege logs, we can expect categorical logs to become more widely used. The best guidance on the applicability and construction of categorical privilege logs that I am aware of comes from the ABA’s Guidance and Model for Categorical Privilege Logs.
Summary Judgment Motions
New Uniform Rule 202.8-g adopts Commercial Division Rule 19-a governing required submissions on a motion for summary judgment. Under 202.8-g, the movant must submit “a short and concise statement, in numbered paragraphs, of the material facts as to which the moving party contends there is no genuine issue to be tried.” The opponent of the motion must then submit “a correspondingly numbered paragraph responding to each numbered paragraph in the statement of the moving party, and if necessary, additional paragraphs containing a separate short and concise statement of the material facts as to which it is contended that there exists a genuine issue to be tried.” And “each numbered paragraph in the statement of material facts . . . will be deemed admitted unless specifically controverted by a correspondingly numbered paragraph in the statement required to be served by the opposing party.”
Among the Commercial Division judges, Rule 19-a has received mixed reviews. Some judges view the submissions as a helpful guides to the motion record, while others prefer that the parties submit a single, joint statement of undisputed facts in lieu of the competing statements envisioned by Rule 19-a. (See Justice Schecter’s Individual Rules, for example). Judges in the general part may likewise tweak New Uniform Rule 202.8-g, underscoring the importance of strict adherence to both the Uniform Rules and the Court’s Individual Rules.
Litigation in the Commercial Division is efficient and effective in part because its judges strictly enforce the Commercial Division Rules. Doubters can peruse my colleague Matt Donovan’s “Check the Rules” series on this blog. Meanwhile, Practitioners can expect equally strict application of these new and revised Uniform Rules from the general part judges. And although the effects of these rule changes remain to be seen, extension of the Commercial Division rules into the general part is a welcome step toward improving the efficiency of all New York Trial Courts.