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February 12, 2009

New York's Highest Court Reverses Ruling that Imposed Forfeiture of $750,000 for Failure to Timely Submit a Judgment.

Rule 202.48 of the Uniform Rules for the New York State Trial Courts requires the winner of a decision containing a directive to "submit" or "settle" the order or judgment to so act within sixty days. Under the Rule, failure to timely submit under such circumstances and without "good cause," constitutes an abandonment of the judgment.

In a widely publicized 2007 decision in Farkas v. Farkas, which involved a contentious matrimonial matter, the First Department held that a $750,000 award must be forfeited because the plaintiff failed to timely submit a judgment under Rule 202.48.

The Court of Appeals granted leave to appeal and recently issued its decision. New York's Highest Court overturned the First Department's decision on the basis that that an earlier decision of the trial court authorized the award "without further order." In the eyes of the Court of Appeals, this language made the settlement process set forth in the Rule unnecessary.

To avoid the potential forfeiture of an award and favorable decision, the safer practice is to ensure that proposed orders are submitted with in the 60 day time period set forth in Rule 202.48.

If you require further information regarding the information presented in this Legal Alert and its impact on your organization, please contact any of the members of the Practice Area.

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