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Court of Appeals Clarifies The “Relation Back Doctrine” When A Necessary Party Is Not Initially Named In Litigation

The New York Court of Appeals, in an action challenging the issuance of a use variance, clarified the application of the “relation back doctrine” to allow an amended petition adding a necessary party, after expiration of the statute of limitations. In Matter of Joseph Nemeth v. K-Tooling the Court found, omitting the owner of the property at issue from the initial petition in the Article 78 challenge to the use variance could be cured through the relation back doctrine in CPLR 203 (C).

Outlining the general rule at issue, the Court explained that with: “the relation back doctrine, claims against a party mistakenly omitted from the initial filing and then added after the expiration of the limitations period may be treated as interposed when the action was timely commenced against the originally named respondents. The relation back doctrine applies when (1) the claims arise out of the same conduct, transaction or occurrence; (2) the new party is ‘united in interest’ with an original defendant and thus can be charged with such notice of the commencement of the action such that a court concludes that the party will not be prejudiced in defending against the action; and (3) the new party knew or should have known that, but for a mistaken omission, they would have been named in the initial pleading (see Buran v Coupal, 87 NY2d 173, 178 [1995]).

The doctrine focuses on the notice and prejudice to the added party. However, the doctrine does not apply when a plaintiff ‘intentionally decides not to assert a claim against a party known to be potentially liable’ or when the new party was omitted ‘to obtain a tactical advantage in the litigation’ (id. at 181). These exceptions minimize gamesmanship and manipulation of the CPLR (see id.).'”

In its analysis of the situation before it, the Court noted that this litigation has been part of an ongoing dispute for over a decade in which Petitioners, who own property adjacent to the property of Rosa Kuehn (hereinafter “Rosa”), have disputed the expansion of a nonconforming family owned manufacturing business on Rosa’s  property. In an earlier Article 78 proceeding the petitioners named Rosa as a party and were successful in blocking a variance. Thereafter, a new request for a variance (also signed by Rosa) was granted and petitioners again challenged the variance request. Yet, they initially failed to name Rosa as a party and the Article 78 proceeding was dismissed. Petitioner’s filed an amended Petition naming Rosa, after the passage of the statute of limitations. The lower courts dismissed the amended petition as time barred.

“The Appellate Division affirmed with one Justice dissenting (205 AD3d 1093 [3d Dept 2022]). Relying on departmental precedent, the majority concluded that the relation back doctrine is unavailable to save an untimely filing where ‘there is no ‘mistake’ within the meaning of the relation back if [petitioners] ‘knew of the existence of the proper parties at the time of their initial filing’  and, here, petitioners could not claim ‘that they were unaware of Rosa Kuehn’s identity as the owner of the subject property or that there was a question of or misunderstanding regarding her status’ (id. at 1096, quoting Buran, 87 NY2d at 180).”

In taking up the argument of the dissenting Justice of the Appellate Division the Court found:

“Petitioners principally argue that, for purposes of the third prong of the relation back analysis, the addition of a mistakenly-omitted necessary party relates back whether one views the omission as a mistake of ‘law’ or simply an oversight in identifying the proper party unless the omission was a deliberate choice or motivated by gamesmanship. Respondents counter that the relation back doctrine is unavailable to petitioners because they were aware of the omitted necessary party’s existence but failed to include her in the action. We now hold that the relation back doctrine is not limited to cases where the amending party’s omission results from doubts regarding the omitted party’s identity or status….

The Appellate Division decision below is the latest in a line of cases interpreting Buran as limiting the relation back doctrine to mistakes regarding the identity or status of a proper party (see Matter of Nemeth, 205 AD3d at 1094-1095, citing, inter alia, Matter of Sullivan v Planning Bd. of the Town of Mamakating, 151 AD3d 1518, 1520 [3d Dept 2017]; Branch v Community Coll. of the County of Sullivan, 148 AD3d 1410, 1411-1412 [3d Dept 2017]; Matter of Ayuda Re Funding, LLC v Town of Liberty, 121 AD3d 1474, 1476 [3d Dept 2014]). However, as we now make clear, the relation back doctrine is not so limited. Rather, the doctrine applies when the party knew or should have known that, but for the mistake—be it a simple oversight or a mistake of law (i.e., that the amending party failed to recognize the other party as a legally necessary party)—the non-amending party would have been named initially….”

The Court concluded that Rosa was not prejudiced in failing to be named initially as she “…knew or should have known that, but for a mistake, she would have been named as a respondent…. when the ZBA granted a second request for a variance—a request Rosa signed on behalf of Kuehn Manufacturing—petitioners again sought to have the variance annulled. Under these circumstances, as the owner of the land benefited by the variance and as a signatory of the variance application on behalf of a company whose use of the property depends on the variance, Rosa could not have understood her omission to be anything other than an oversight. Indeed, respondents effectively concede Rosa’s omission from the proceeding here was a mistake. ”

As a result of Rosa’s interest in the property and the business there was a mutuality of interest with the other parties.

The Court also concluded that there was no evidence that the failure to include Rosa would fall within the exception to the doctrine, when a party omits a necessary party as a deliberate tactic.



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