Background
Tonya Williams and additional plaintiffs commenced this action against the New York City Office of Chief Medical Examiner and Unity Funeral Chapels, Inc. (Unity), asserting claims for negligence, breach of contract, and fraud in connection with the handling of remains. Unity failed to appear or answer the complaint. In July 2021, Supreme Court, Kings County granted the plaintiffs’ unopposed motion for leave to enter a default judgment against Unity. An inquest was held in October 2021, at which the court found that each plaintiff was entitled to $1.25 million in damages — $2.5 million in total — against Unity.
Unity subsequently moved to vacate the default judgment, the default liability finding, and the $2.5 million damages determination under CPLR 5015(a)(1). Supreme Court denied the motion. Unity appealed.
The Court’s Holding
The Appellate Division modified and partially granted Unity’s motion. The court dismissed the portion of the appeal relating to Unity’s motion to vacate the inquest “decision” (as opposed to the judgment), as no appeal lies from a motion to vacate a decision rather than a judgment or order. However, the court found that the lower court abused its discretion in denying Unity’s motion to vacate the default judgment itself. On the law, the facts, and in the exercise of discretion, the Appellate Division vacated the October 2021 judgment for $2.5 million and remitted the matter to Supreme Court, Kings County — to a different Justice — for a new inquest and fresh determination on damages. The default on liability was affirmed.
Key Takeaways
- A motion to vacate a court’s “decision” after an inquest is not appealable; practitioners must target the judgment or order for vacatur purposes.
- Even after a default on liability is sustained, a court may abuse its discretion by refusing to vacate a damages award rendered at an inquest that was procedurally or substantively flawed — the Appellate Division can order a new inquest before a different judge.
- When a new inquest is ordered, the matter should be assigned to a different judge to ensure a fresh determination untainted by the prior proceedings.
Why It Matters
Default judgment practice in New York often proceeds to an inquest on damages even when the defendant fails to appear. This decision is a reminder that the damages determination at an inquest is not automatically insulated from review. Defaulting defendants who come forward after an inquest with a colorable basis for vacatur — showing a potentially meritorious defense and excuse for default — can still challenge the damages determination even if they accept the liability default. Plaintiffs’ counsel should expect that extraordinary inquest awards may be subject to appellate correction, and should ensure inquest proceedings are conducted with careful attention to the evidentiary record supporting the damages sought.