Part 130 of the Rules of the Chief Administrator; Section 202.16 of Uniform Civil Rules for the Supreme Court and the County Court.

CIVIL PROCEDURE -- ATTORNEY CONDUCT -- FRIVOLOUS CONDUCT -- SANCTIONS

AMENDMENTS EXPAND DEFINITION OF FRIVOLOUS CONDUCT AND INCREASE POTENTIAL SANCTIONS.

[SUMMARY] [RULES CITED] | [COMMENTARY] | [UNANSWERED QUESTIONS] [SURVEY OF THE LAW IN OTHER JURISDICTIONS] [RELATED NEWS STORIES]

SUMMARY

Effective January 1, 1998, amendments to the Rules of the Chief Administrator and the Uniform Civil Rules for the Supreme Court and County Court impose several changes designed to control frivolous attorney conduct:

The new certification provisions require lawyers to sign all papers served or filed in civil proceedings to certify that after a reasonable inquiry, the lawyer finds neither the pleadings nor the statements of fact to be frivolous or false. N.Y. Comp. Codes R. & Regs. tit. 22, 130-1.1-a (1997). This certification requirement supersedes the special rule for matrimonial actions that required lawyers to certify only the accuracy of their clients' financial disclosures. N.Y. Comp. Codes R. & Regs. tit. 22., 202.16 (1997).

The changes significantly increase the financial penalty that may be imposed for frivolous conduct. In addition to increasing the maximum sanction from $10,000 per case to $10,000 per incident, N.Y. Comp. Codes R. & Regs. tit. 22, 130-1.2 (1997), the revision removes the $10,000 limit on the aggregate amount of sanctions and attorney's fees awardable for a single occurrence of frivolous conduct. Id. Moreover, where attorney tardiness forces the adjournment of a case, the new rule authorizes judges to impose additional fines of up to $2,500. N.Y. Comp. Codes R. & Regs. tit. 22, 130-2 (1997).

The new provision defines frivolous conduct as any conduct that is completely without merit in law, that is undertaken primarily to prolong litigation, or that asserts material factual statements which are false. N.Y. Comp. Codes R. & Regs. tit. 22, 130-1.1 (1997). Note that motions made under the new rules are also subject to the rules.

RULES CITED

COMMENTARY

Changes Incorporated into Part 130 by the September 17, 1997 Amendments

Effective January 1, 1998, attorneys practicing before New York state courts will face more stringent standards defining frivolous conduct under amended Part 130 of the Rules of the Chief Administrator. N.Y. Comp. Codes R. & Regs. tit. 22, 130-1.1, 130-1.1-a (1997). In addition, attorneys who engage in frivolous conduct face the risk of increased sanctions under amended Part 130. N.Y. Comp. Codes R. & Regs. tit. 22, 130-1.2, 130-2.1, 130-2.2 (1997).

Section 130-1.1(c), which defines frivolous conduct for purposes of Part 130, was amended by deleting the phrase "or law" from 130-1.1(c)(1), and adding 130-1.1(c)(3) which states that conduct is frivolous if "it asserts material factual statements that are false." N.Y. Comp. Codes R. & Regs. tit. 22 (1997). The amendments also indicate that a court, when considering whether the conduct in question is frivolous, shall consider "whether or not the conduct was continued when its lack of legal or factual basis was apparent, should have been apparent, or was brought to the attention of counsel or the party." Id. Prior to these amendments the court was merely required to consider whether such conduct was continued when "its lack of factual basis was apparent, or should have been apparent to counsel" (emphasis added). N.Y. Comp. Codes R. & Regs. tit. 22, 130-1.1(c) (1995).

Amended 130-1.1-a (a) provides that each "pleading, written motion, and other paper, served on another party or filed or submitted to court shall be signed by an attorney, or by a party if the party is not represented by an attorney." N.Y. Comp. Codes R. & Regs. tit. 22, 130-1.1-a (a) (1997). The provision further states that "[a]bsent good cause shown, the court shall strike any unsigned paper if the omission of the signature is not corrected promptly after being called to the attention of the attorney or party." Id. Amended 130-1.1-a (b) indicates that by signing a paper, "an attorney or party certifies that, to the best of that person's knowledge, information and belief, formed after an inquiry reasonable under the circumstances, the presentation of the paper or the contentions therein are not frivolous as defined in subsection (c) of 130-1.1." N.Y. Comp. Codes R. & Regs. tit. 22, 130-1.1-a (b) (1997).

Amendments to sections 130-1.2, 130-2.1, and 130-2.2 increase the total value of sanctions that may be imposed or costs that may be awarded by the court in response to an attorney's frivolous conduct as defined by Part 130. N.Y. Comp. Codes R. & Regs. tit. 22 (1997). By replacing the phrase "in any action or proceeding" with the phrase "for any single occurrence of frivolous conduct," the amendments to 130-1.2 increase the potential value of sanctions that may be imposed against an attorney in a civil proceeding. N.Y. Comp. Codes R. & Regs. tit. 22, 130-1.2 (1997). Rather than merely facing a $10,000 maximum sanction, an attorney may be sanctioned up to $10,000 for each occurrence of frivolous conduct. Furthermore, revisions to 130-2.1 and 130-2.2 make clear that the court, in its discretion, may both impose sanctions and award costs. N.Y. Comp. Codes R. & Regs. tit. 22 (1997).

Effect of Changes Incorporated Into Part 130 by the September 17, 1997 Amendments

The changes to Part 130 will likely increase an attorney's burden to make reasonable inquiries regarding the truth of assertions made in papers filed with New York State Courts. The addition of 130-1.1-a requires attorneys to sign all papers filed with New York state courts and further indicates that such signing shall constitute certification that the attorney has made a reasonable inquiry and that to the best of the attorney's knowledge, information and belief the presentation of such papers and the assertions contained in such papers are not frivolous. Furthermore, the risk of increased sanctions will likely provide further incentive for attorneys to make more substantial inquiries into the truth of assertions contained in papers filed in New York courts.

Changes to Section 202.16 by September 17, 1997 Amendments

The changes to 202.16 remove the requirement that counsel have no knowledge that the substance of the submission is false. N.Y. Comp. Codes R. & Regs. tit. 22 (1997). Attorneys must instead comply with the heightened certification requirements of new section 130-1.1-a. N.Y. Comp. Codes R. & Regs. tit. 22 (1997).

Effect of Changes to Section 202.16 by the September 17, 1997 Amendments

The certification requirements in new Section 130-1.1-a impose a higher burden of inquiry on attorneys submitting papers to the court in matrimonial and other family law matters.

Unanswered Questions

Please note that the Office of Court Administration has published a brochure containing answers to questions commonly asked regarding the signature requirement, as recently amended, in part 130. The New York Law Journal has this information posted at www.nylj.com/links/part130qa.html. Questions may also be addressed to "part130@courts.state.ny.us". In addition, questions may be placed by phone at 1-800-334-6442.

Section 130-1.1(c)(3) defines a new category of frivolous conduct, but leaves ambiguous what conduct will constitute a violation under this new provision. For example, the provision does not specify whether opinions or inferences based on false material facts would be considered a violation. Use of the phrase "factual statements" suggests the possibility that opinions supported by false statements may not be a violation.

Section 130-1.2 limits sanctions for single occurrences of frivolous conduct but does not define what constitutes a single occurrence. For example, where a pleading is deemed frivolous under these rules because it contains multiple baseless factual statements, is each statement an occurrence, or is the pleading itself the occurrence? The availability of sanctions may be significantly enhanced depending on how courts decide to define "single occurrence."

Under new 130-1.1-a (b), it is unclear what level of inquiry will be deemed "reasonable under the circumstances." This section is substantially similar to Fed. R. Civ. P.11, so courts may impose a level of inquiry similar to that imposed on attorneys in federal civil proceedings.

A new factor to be considered by the court in determining whether conduct is frivolous is whether the lack of legal or factual basis was brought to the attention of a party. It is unclear how the court will weigh this factor. A client may be notified of the lack of factual or legal basis of an assertion, but may fail to notify counsel. The client may not know that the information is significant, or may conceal the information because disclosure would be harmful; in either case the attorney could be sanctioned under the amended rules.

Survey of the Law in Other Jurisdictions

Similar to New York's amendment which permits court discretion to award costs in addition to or in lieu of financial sanctions for frivolous conduct in civil litigation, the Federal Rules permit either sanctions or costs.

Under Rule 11 of the Federal Rules of Civil Procedure, courts are permitted to impose sanctions which may consist of an order for a party to pay the reasonable expenses including reasonable attorney's fees of the opposing party. Note that Rule 11 is tailored to deal only with frivolous written matter; this does not include other conduct.

Some states have dealt with frivolous conduct in much the same way as New York. According to the Ohio Revised Code 2323.51, an Ohio court may award court costs, reasonable attorney's fees, and other reasonable expenses in connection with the civil action to the party adversely affected by the frivolous conduct at any time before the beginning of the trial in a civil action or within twenty-one days after judgment has been determined in a civil action. Ohio Rev. Code Ann. 2323.51 (Banks-Baldwin 1997). Such an award may be made upon a motion by a party to the action if the court has established a hearing date to determine if the conduct was frivolous, gives notice of the hearing date, and properly conducts the hearing. Id. The amount of the award may not exceed the following, whichever is applicable: (a) if representation is on a contingent fee basis, the amount of reasonable fees that would have been incurred had the representation been on an hourly fee or other basis; or (b) attorney's fees reasonably incurred. Id. Note that the rule is exclusively compensatory rather than compensatory and punitive.

Similar to the Ohio Revised Code, 123 of Title 12 of the Idaho Code mandates that a court may award reasonable attorney's fees to any party adversely affected by the frivolous conduct at any time before the beginning of the trial in a civil action or within twenty-one days after judgment has been determined in a civil action. Idaho Code 123 (1997). Moreover, such award may be made upon motion by a party only after the court has (a) set a hearing date to determine whether the conduct was frivolous; (b) given notice regarding the hearing date to all parties; and (c) conducted the hearing properly. Id. The amount of the award may not exceed the attorney's fees reasonably incurred by the injured party as a result of the frivolous conduct. Id. Again, note the compensatory nature of the rule.

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