New York State Law Digest: August 2026

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New York State Law Digest: August 2026

AMENDMENTS

Amendment Brings Major Changes to Third-Party Practice

Most Significantly Sets Deadline for Bringing Third-Party Actions

Prior to a 2025 amendment effective April 18, 2026 (and applicable to actions commenced after that date), CPLR 1007 provided no deadline for commencing a third-party action. The amendment, as modified by chapter amendments in 2026 and entitled the “Avoiding Vexatious Overuse of Impleading to Delay (AVOID) Act,” sets a deadline of 90 days after the service of the answer for a defendant to file a third-party action, absent a court order. The defendant/third-party plaintiff then has only 20 days after the filing, not 120 days as previously permitted, to serve the third-party defendant. The third-party action cannot be filed after the filing of the note of issue, unless good cause is shown or in the interest of justice.

Absent a court order, where a third-party action is commenced against the plaintiff’s employer, the 90-day period is to run from the later of the date (i) the employer’s identity becomes known to the defendant or third-party defendant, or (ii) the defendant or third-party defendant knows or should know that the plaintiff sustained a grave injury as defined in Workers’ Compensation Law ¶ 11. An action filed in violation of this section is to be severed or dismissed without prejudice. Where the third-party action is severed and a third-party plaintiff commences a separate action against the severed third-party defendant, a motion to consolidate will not be permitted.

Significantly, because of the reduction of the time to serve the third-party defendant from 120 to 20 days, a reference to a “third party summons and complaint” was removed from CPLR 306-b. Thus, it appears that the ability to seek an extension of time to serve “upon good cause shown or in the interest of justice” expressly permitted under CPLR 306-b, is no longer available in third-party actions.

The 2025 Sponsors Memorandum provides, in pertinent part, the justification for the amendment:

[S]ection 1007 is silent regarding the timetable for impleading such parties. Clever defendants have thus developed an egregious strategy to add years to any case and, during that respite, avoid financial accountability. These defendants deliberately delay the case by impleading known or identifiable third-party defendants into a case on a rolling basis, one after another after another etc. Each time a new third-party defendant is added to the case, the newly added party has the right to depose all the parties that have already been deposed, as well as asking for document discovery that has already been produced. The newly added party can also serve additional document requests tailored to the pertinent liability issues concerning the newly added person or legal entity. Discovery begins anew when a party joins a case.

While the amendment is well- intentioned, it raises certain difficulties. As stated above, the CPLR 306-b extension of time to serve no longer appears to be available. This is especially problematic in view of the exceedingly short period of 20 days to serve, particularly when attempting to serve an individual. This will undoubtedly result in motions seeking additional time to serve, now with no established (CPLR 306-b) criteria for permitting such an extension.

As noted above, the Sponsors Memorandum complains of “clever defendants” developing a strategy to add years to the case by deliberately delaying it, impleading known or identifiable third-party defendants on a rolling basis one after another. However, should the 90-day period run from the date the last defendant answered? That was a decision made by the plaintiff or that last defendant and may not be a form of gamesmanship or the like by another defendant seeking to bring in a third-party.

The amendment will seemingly encourage premature filings of third-party complaints as a preventative measure because of the strict 90-day deadline. Moreover, it is not uncommon in some actions that little or no discovery is conducted before a preliminary conference. Where there are multiple defendants served at various times and whose answers may be served over a significant period of time, that conference may not be scheduled until the last defendant is served. That could occur in excess of 90 days after a particular defendant has earlier answered. Discovery that may be crucial in determining the identity of potential third-party defendants may not proceed until well after that 90-day period.

The amendment thus may cause defendants to seek significant extensions of time to answer from the plaintiff or the court to, at the very least, engage in some independent informal discovery in order to identify potential third-party defendants. With respect to the impleader of the plaintiff’s employer, the criteria to determine the precise deadline is rife with potential factual issues (e.g., the party’s knowledge), which will inevitably result in yet additional motion practice.

The amendment does not appear to preclude parties from entering into stipulations extending the time for bringing third-party actions and, of course, courts can set different deadlines. It would seem prudent for defendants to seek at
preliminary conferences a reasonable deadline to bring third-party actions based on the particular facts of the case. Again, this may result in motion practice.

Tort Reform Amendment Creates Exception to Pure Comparative Fault Scheme

Same Amendment Effects Significant Changes in Area of Serious Injury Litigation

Since 1975 New York has been a pure comparative negligence jurisdiction. Thus, if a plaintiff is found to be 95% negligent, they could still recover 5% of the amount awarded by the fact-finder. As part of a tort reform package apparently aimed at reducing insurance premiums, CPLR 1411 was amended, effective May 26, 2026. Significantly, New York’s pure comparative regimen was modified, carving out an exception in automobile personal injury cases, in essence barring recovery in certain circumstances. Thus, the existing statute was amended to break CPLR 1411 into two subsections. Subsection (a) retained the pure comparative fault language, subject to the new subsection (b), providing that:

In any action to recover damages for personal injury subject to article fifty-one of the insurance law, the culpable conduct attributable to the claimant shall bar recovery if the culpable conduct attributable to the claimant is greater than the culpable conduct of the person against whom recovery is sought or is greater than the combined culpable conduct of the persons against whom recovery is sought.

Unfortunately, the language is a bit ambiguous. Where there is only one defendant, the plaintiff is clearly precluded from recovering where their culpable conduct exceeds that of the defendant (e.g., 51–49%). If there are multiple defendants, plaintiff’s share must exceed the total combined shares of the defendants to bar recovery. However, one could also read the statute as providing that in the case of multiple defendants, even if the total shares of the defendants exceed the plaintiff, the plaintiff could still be precluded from recovering against an individual defendant, if the plaintiff’s share exceeds that defendant’s share. For example, P is found to be 35% at fault, D1 40% and D2 25%. Would P be barred from recovering against D2?

As part of the same law, Insurance Law 5102(d) was amended to remove the 90/180-day category from the definition of “serious injury,” that is,

a medically determined injury or impairment of a non-permanent nature which prevents the injured person from performing substantially all of the material acts which constitute such person’s usual and customary daily activities for not less than ninety days during the one hundred eighty days immediately following the occurrence of the injury or impairment.

Because of the relative subjective nature of this category, this was sometimes the preferred method of meeting the serious injury threshold in borderline cases.

Moreover, Insurance Law 5104(a) was amended to provide that “[n]o liability for non-economic loss shall be fixed unless and until the trier of fact has determined the existence of a serious injury. In any action to recover non-economic loss pursuant to this article, the trier of fact shall not determine the question of whether an injury is a serious injury until the trier of fact has determined the party or parties at fault.” The statutory language is ambiguous and seemingly contradictory. It appears that the trier of fact must first determine fault, followed by a determination as to whether the plaintiff’s injury meets the serious injury threshold. Only then can non-economic loss damages (pain and suffering) be fixed. This seems intended, at least in part, to resolve a conflict at the Appellate Division level as to the accrual date for prejudgment interest in a motor vehicle personal injury action implicating the No-Fault law. The Second and Third Departments have held that the serious injury issue is a damages question, with interest running from the liability determination, while the Fourth Department has held that a “liability” finding encompasses both the negligence and serious injury determinations.

Finally, Insurance Law 5104(d) was added to provide a $100,000 cap on non-economic loss in a motor vehicle personal injury action (other than death), where the injured person is at fault, but not barred by the newly added CPLR 1411(b), and was operating (i) an uninsured vehicle, except if a lapse of insurance coverage lasted less than thirty days; (ii) a motor vehicle while impaired when the accident occurred and convicted of such; or (iii) a motor vehicle, while committing a felony or while immediately fleeing when the accident occurred, and was convicted of the felony.

CASE LAW DEVELOPMENTS

Third Department Holds Trial Court Properly Awarded Counsel Fees and Expenses in CPLR Article 86 Case Arising Out of Town Court Clerk’s Rejection of Papers for Filing

CPLR 2102(c) Does Not Permit Court Clerk to Reject Papers for Filing Absent a Specific Statute, Rule or Court Order

In Matter of Moore v. Town of Colonie, 2026 N.Y. Slip Op. 04353 (3d Dep’t July 9, 2026), the petitioners attempted to file summary eviction proceedings with the respondent Colonie Town Justice Court. However, the respondent Clerk of the Colonie Town Justice Court rejected the papers without explanation. The petitioners then brought this article 78 proceeding against the respondents seeking, as relevant here, a writ of mandamus to compel the respondents to accept the petitioners’ legal filings. Respondents claimed that they were ethically prohibited from accepting the papers premised on an advisory opinion from the State Commission on Judicial Conduct. The trial court found that the Clerk failed to perform her mandatory duty and granted the petition.

The petitioners then filed a motion pursuant to CPLR article 86, the Equal Access to Justice Act (EAJA), to recover legal fees and expenses. The statute is intended to assist litigants with limited means to be able to retain counsel to litigate wrongful actions of the state. The respondents argued in opposition that the EAJA did not apply because the Clerk was not an officer of the state and, regardless, the Clerk’s actions were proper and petitioners’ legal fees were unreasonable. The trial court found that the EAJA applied, the clerk’s actions were not substantially justified, and petitioners’ counsel fees were reasonable. The court awarded the petitioners legal fees and expenses.

The Third Department affirmed. Initially, it found that the town court clerk was an agent of the state within the meaning of the EAJA. It rejected the respondents’ argument that the EAJA was

inapplicable to town justice courts because of their limited jurisdiction and the fact that their employees are not employed by the state, as the State Constitution includes town courts within the unified court system (see NY Const, art VI, § 1 [a]). Turning to the language of the statute itself, the term “[s]tate” is defined under the EAJA as “the state or any of its agencies or any of its officials acting in his or her official capacity” (CPLR 8602 [g]). “Local officials and administrators may be deemed agents of the state” in the context of the EAJA, and
“[s]uch a determination is made on a case-by-case basis upon examination of the applicable statutory authority and nature of the entity.” To this end, given the EAJA’s remedial purpose, it “should be liberally construed to carry out the reforms intended and to promote justice, and interpreted broadly to accomplish its goals” and, thus, “we may not read into it any limitations that are not clearly expressed.” Pertinent here, a determination as to whether a clerk is a state or local official rests upon “the nature of the act which is the subject of the suit,” as a clerk may be determined to be a state officer when performing “acts that are in themselves a part of the judicial system.” Here, the underlying action is premised upon the Clerk’s refusal of petitioners’ legal filings. Given that petitioners’ filings in a summary eviction proceeding are unquestionably “part of the judicial process,” Supreme Court did not err in concluding that the Clerk acted as a state official and, thus, in applying the EAJA in this proceeding (citations omitted).

Id. at *1–2.

The court also ruled that the trial court’s award of counsel fees was proper. The EAJA states that “a court shall award to a prevailing party, other than the state, fees and other expenses incurred by such party in any civil action brought against the state, unless the court finds that the position of the state was substantially justified or that special circumstances make an award unjust.” CPLR 8601(a). “The determinative inquiry is whether the challenged actions are ‘justified to a degree that could satisfy a reasonable person, or hav[e] a reasonable basis both in law and fact’ (citations omitted).” Moore at *2.

CPLR 2102(c), in turn, provides that “[a] clerk shall not refuse to accept for filing any paper presented for that purpose except where specifically directed to do so by statute or rules promulgated by the chief administrator of the courts, or order of the court.” Here, there was no dispute that the Clerk rejected petitioners’ legal filings based merely on a verbal directive, not a statute, rule or court order. As a result,

the Clerk’s refusal to accept petitioners’ filings was not substantially justified inasmuch as she failed to perform her duty as clerk of the court without proper justification (see CPLR 2102 [c]; 8601 [a]) . . . To the extent that respondents contend that special circumstances otherwise exist so as to render an award of counsel fees unjust based upon the Clerk’s apparent good faith basis in refusing to accept petitioners’ filings (see CPLR 8601 [a]), we reject this reasoning as it runs counter to both the remedial purpose of the EAJA and the court clerk’s statutorily mandated duties (citations omitted).

Id. at *3.

Finally, the Third Department held that the trial court did not err in its determination that the counsel fees and expenses were reasonable, finding the petitioners’ submission to be sufficient, and in accord with CPLR 8601.

Second Department Sanctions Counsel and His Law Firm for Citation to Fictitious Cases and Quotes and Misrepresentation of Holdings

Yet Another Improper Use of AI Without Verifying Information

In Landberg v. City of New York, 2026 N.Y. Slip Op. 03935 (2d Dep’t June 23, 2026), the plaintiff’s appellant’s brief submitted by Michael Sanders, Esq., cited to nonexistent cases and fictitious quotes, misstated the law, and misrepresented the holdings of real cases. Significantly, this included twice citing to the nonexistent Court of Appeals case of Xiang Fu Ji v. City of New York with respect to an alleged proposition concerning Administrative Code of the City of New York § 7-210. A real case with a vaguely similar name with a different citation did not contain the quote or support the proposition advanced by the appellant (that the subject provision being remedial in nature was to be construed liberally). In fact, another Court of Appeals decision stands for the opposite proposition, that is, because Administrative Code § 7-210 is in derogation of the common law creating “liability where none previously existed, [it] must be construed strictly (citation omitted).” Landberg at *2.

During oral argument the court raised the issues noted above but Sanders failed to acknowledge the use of AI. On the appellate court’s own motion seeking sanctions, Sanders finally conceded that he used AI assisted research tools in doing his “supplemental research.” The general counsel for the Sanders law firm submitted an affidavit stating that “Sanders utilized generative artificial intelligence tools in a manner that exceeded the scope of technology approved for use by the [law firm].” However, the affidavit also insisted that since 2024 when he first became employed at the firm, Sanders had “maintained an unblemished record,” and the general counsel had “never received a single complaint regarding his work product, his ethics, or his diligence.”

The Second Department cited to both Deutsche Bank Natl. Trust Co. v. LeTennier, 250 N.Y.S.3d 260 (3d Dep’t 2026) and Matter of Julien v. Arthur, 2026 N.Y. Slip Op. 03308 (2d Dep’t May 27, 2026), which we have previously discussed in the Law Digest. In Landberg, the court noted that the facts in the instant case were much more egregious than in Julien

in that the person who filed the subject brief is a trained attorney with access to legal research materials, including Westlaw, and who is bound by the Rules of Professional Conduct (see Rules of Prof Conduct [22 NYCRR 1200.0] rules 1.1[a]; 3.3[a][1]; 8.4[d], [h]). Further, stories about the unreliability of GenAI in performing legal work, leading to fictitious citations, misrepresentations of the law, and sanctions, have been widespread in the media for years, putting all attorneys on notice of this (citations omitted).

Id. at *6.

The court also took issue with Sanders’ unwillingness to address the issue and his lack of candor. For example,

when confronted about the fabricated cases cited in his brief at oral argument, Sanders declined the opportunity to take a 15-minute recess to discern where he had found the cases, and maintained that he had found them either on Westlaw or Lexis or in a book, a previous case, or another brief. As Sanders later admitted in his affirmation, he was not being candid at the time of oral argument, as he should have said that the cases were hallucinated by artificial intelligence. Sanders “expla[ined]” that his decision to be dishonest with the Court was due to being “scared.” This may be true. However, Sanders’s decision not to be honest with the Court during oral argument also demonstrated his professional immaturity, arrogance, and profound lack of respect for the judicial system.

Id. at *6–7.

The court added that “it appears that GenAI was used to do more than simply conduct supplemental research, as suggested by Sanders in his affirmation. Sanders wholly failed to fulfill his obligation to review the work of GenAI to prevent the submission to this Court of a brief containing significant misrepresentations of the law.” Id. at *7.

As a result, the Second Department imposed an $8,000 sanction against Sanders and $2,500 against the law firm, because “the law firm’s name appeared on a brief that contained significant misrepresentations, and in light of the deterrent purpose of sanctions.”

The court also ominously cautioned that it was limiting itself to the issue before it and “[w]hether disciplinary action is also warranted may be a matter for the Attorney Grievance Committee.” See, e.g., In re Zareh, 250 N.Y.S.3d 534 (1st Dep’t 2026) (First Department grants New York Attorney Grievance Committee motion seeking order pursuant to doctrine of reciprocal discipline that attorney be publicly censured, for submitting a brief in a Texas action, containing numerous citation errors and repeatedly misrepresenting case law for propositions it did not support).

“Decision and Order” Did Not Meet Essential Elements of an Order

Thus, Fourth Department Dismisses Appeal

Many, if not most, determinations of a trial court are in the form of an “order.” If a court issues a decision, however, that decision should be converted into an order because you cannot appeal from a decision and there are deadlines attached to the service of an order with notice of entry (for example, serving a notice of appeal or a motion to reargue).

Where the order directs that it be “settled” or submitted,” 22 N.Y.C.R.R. § 202.48 governs. It provides that “[p]roposed orders or judgments, with proof of service on all parties where the order is directed to be settled or submitted on notice, must be submitted for signature, unless otherwise directed by the court, within 60 days after the signing and filing of the decision directing that the order be settled or submitted.”
22 N.Y.C.R.R. § 202.48(a). The failure to do so “shall be deemed an abandonment of the motion or action, unless for good cause shown.” 22 N.Y.C.R.R. § 202.48(b).

Monfort v. Alden Cent. Sch. Dist., 249 A.D.3d 1479 (4th Dep’t 2026) highlights another lurking issue. There, in a Child Victims Act action, the plaintiff appealed from a “Decision and Order.” Seemed like it was safe to do so with the title including the word “Order.” However, the Fourth Department noted that an appeal does not lie from a decision “and a document does not become an order simply because it has been denominated as such. Although the paper contains the words ‘Decision and Order,’ it does not meet the essential elements of an order inasmuch as it does not ‘recite the papers used on the motion’ (CPLR 2219 [a]), and furthermore ‘that document did not actually order anything’ (citations omitted).” Id. at 1480. As a result, the court dismissed the appeal.