Underhill Venture, LLC v Sarang
Attorneys and Parties
Brief Summary
Real estate contract and appellate cost-taxation dispute over whether digital appellate record and brief preparation expenses are recoverable as disbursements.
The Supreme Court granted the defendants' motion under CPLR 5015(a) [permits a court to relieve a party from a judgment or order] to vacate the plaintiff's awarded disbursements for digital appellate printing expenses and a $300 notice-of-pendency cancellation fee, ruling that the prior award of one bill of costs did not include disbursements and that only the statutory appellate cost of $250 was recoverable.
The Appellate Division reversed the vacatur of the $6,135.54 printing-related disbursement, but left intact the vacatur of the $300 cancellation-fee disbursement.
An appellate award of one bill of costs includes disbursements absent contrary direction under 22 NYCRR 1250.16(b) [provides that an appellate award of costs is deemed to include disbursements unless the court directs otherwise]. The court held that expenses for electronic bookmarks, links, digital file conversions, and uploads required to assemble and submit a digital record and briefs qualify as taxable printing expenses under CPLR 8301(a)(6) [allows taxation of necessary disbursements, including reasonable expenses of printing papers for a hearing when required]. But the $300 notice-of-pendency cancellation charge was not recoverable under CPLR 8301(a)(13) [allows other reasonable and necessary taxable expenses according to court practice, express law, or court order], because the earlier appeal rejected bad-faith and sanctions theories and did not authorize shifting that expense.
Background
The plaintiff contracted to build and sell a residence in Oyster Bay to the defendants. After alleging the defendants defaulted by failing to pay for requested upgrades, the plaintiff sued for, among other things, a declaration that the contract was null and void and to retain the down payment. The defendants counterclaimed and filed a notice of pendency against the property. The Supreme Court denied the plaintiff's efforts to cancel the notice of pendency, but on an earlier appeal the Appellate Division held that the notice of pendency should have been canceled because the parties had irrevocably waived any right to file a lis pendens in a contract rider. The Appellate Division denied the plaintiff costs under CPLR 6514(c) and denied sanctions, but awarded the plaintiff one bill of costs on the appeal. Afterward, the plaintiff entered judgment including $250 in statutory costs, $6,135.54 in digital appellate printing expenses, and $300 paid to Nassau County to cancel the notice of pendency.
Lower Court Decision
The Supreme Court later granted the defendants' motion to vacate the printing-expense and cancellation-fee portions of the judgment. It concluded that the prior appellate award of one bill of costs did not include disbursements and effectively limited the plaintiff to the $250 statutory appellate cost.
Appellate Division Reversal
The Appellate Division modified the order and judgment by restoring the $6,135.54 printing-expense award and denying that branch of the defendants' CPLR 5015(a) motion. The court held that, because digital filing rules required compliant electronic records and briefs, the plaintiff's use of an appellate printer for bookmarks, links, file conversions, and uploads was a reasonable and necessary printing expense taxable under CPLR 8301(a)(6). The court nevertheless affirmed the vacatur of the $300 cancellation fee, finding that although Nassau County law imposed the fee, the circumstances of the prior appeal did not justify shifting that expense to the defendants.
Legal Significance
This decision recognizes, apparently as a matter of first impression in the Second Department, that digital appellate production costs can constitute taxable printing disbursements under CPLR 8301(a)(6) when they are reasonably incurred to comply with modern appellate e-filing rules. It also clarifies that an award of one bill of costs on appeal ordinarily includes disbursements, and that unenumerated expenses under CPLR 8301(a)(13) remain discretionary and will not be shifted absent circumstances warranting such relief.
In New York appellate practice, reasonable vendor charges for preparing and uploading compliant digital records and briefs may be taxed as printing disbursements, but fees incurred to cancel a notice of pendency will not automatically be shifted to the opposing party without a statutory basis, court order, or circumstances supporting discretionary relief.