For the reasons set forth below, Defendant’s motion: (1) for leave to
amend its Answer pursuant to CPLR 3025(b) to assert new affirmative defenses;
(2) for dismissal based upon those affirmative defenses; and (3) for summary
judgment dismissing the Claim is denied.
The Claim, which was filed with the Clerk of the Court on February 13, 2008,
alleges defamation of character, fraud, malice, negligence and interference with
contractual relations as a result of being reported as in default on certain
By this motion, the Defendant seeks to amend its Answer to assert the
affirmative defenses of res judicata and collateral estoppel and that
the statute of limitations had expired prior to the date of filing of the Claim
(Ex. B attached to Motion).
CPLR 3025(b) provides that leave to amend shall be freely given upon such terms
as are just. The phrase has been interpreted to mean that, in the absence of
prejudice or unfair advantage, leave to amend should be given freely
(McCaskey, Davies & Assoc. v New York City Health & Hosps. Corp.,
59 NY2d 755, 757 ; Nasuf Constr. Corp. v State of New York, 185
AD2d 305 [2d Dept 1992]). “Mere lateness is not a barrier to the
amendment. It must be lateness coupled with significant prejudice to the other
side, the very elements of the laches doctrine” (Edenwald Contr. Co. v
City of New York, 60 NY2d 957, 959 , quoting Siegel, Practice
Commentaries, McKinney’s Cons Laws of NY, Book 7B, CPLR 3025:5; Arcuri
v Ramos, 7 AD3d 741, 741-742 [2d Dept 2004]). “[I]f the amendment is
meritorious and does not cause prejudice or surprise to the nonmoving party, the
determination is a discretionary matter which will not be disturbed absent
abuse” (Matter of Seelig, 302 AD2d 721, 723 [3d Dept 2003];
see Edenwald Contr. Co. v City of New York, 60 NY2d 957,
supra at 959; Turner v Caesar, 2 AD3d 1086, 1087 [3d Dept
2003]; Ferran v Williams, 281 AD2d 819, 820-821 [3d Dept 2001]; lv
dismissed 97 NY2d 653 ). Conversely, such leave “should not be
granted where the proposed amendment is devoid of merit” (Nasuf Constr.
Corp. v State of New York, 185 AD2d 305, supra at 306; Ortega v
Bisogno & Meyerson, 2 AD3d 607, 609 [2d Dept 2003]. The
determination to grant or deny leave to amend is made on a case by case basis
(Murray v City of New York, 43 NY2d 400, 404-405 ; Fulford v
Baker Perkins, Inc., 100 AD2d 861 [2d Dept 1984]).
Prejudice to the non-moving party is shown where that party is “hindered
in the preparation of its case or has been prevented from taking some measure in
support of its position” (Pritzakis v Sbarra, 201 AD2d 797, 799 [3d
Dept 1994]; see Smith v Haggerty, 16 AD3d 967, 968 [3d Dept 2005]).
Here, Claimant has failed to establish that she will be prejudiced if the Court
were to grant the motion.
The query, then, is whether the State has made a sufficient showing that the
amendment may be meritorious.
It is Defendant’s contention that this Claim is barred based upon the
doctrine of res judicata and collateral estoppel because of the dismissal
of a prior claim filed by Ms. Milner.
On May 8, 2001, Ms. Milner filed Claim No. 104248. In that Claim, Ms. Milner
sought damages for injuries she asserts were sustained, when, beginning sometime
prior to September 1999, Defendant began issuing allegedly false statements
regarding the status of her student loans to credit reporting agencies
(see Ex. E attached to State’s Motion papers).
Pursuant to the doctrine of res judicata, or claim preclusion, a valid
final judgment bars future actions between the same parties on the same cause of
action (see Gramatan Home Invs. Corp. v Lopez, 46 NY2d 481, 485 ;
Matter of Field Home-Holy Comforter v De Buono, 238 AD2d 589 [2d Dept
1997]). As a general rule, once a claim is brought to a final conclusion, all
other claims arising out of the same transaction or series of transactions are
barred, even if based upon different theories or if seeking a different remedy
(see O’Brien v City of Syracuse, 54 NY2d 353, 357 ).
“The equitable doctrine of collateral estoppel ‘precludes a party
from relitigating in a subsequent action or proceeding an issue clearly raised
in a prior action or proceeding and decided against that party or those in
privity’” (Church v New York State Thruway Auth., 16 AD3d
808, 809 [3d Dept 2005], quoting Ryan v New York Tel. Co., 62 NY2d 494,
500 ). “[P]reclusive effect is limited to only those ‘issues
that were actually litigated, squarely addressed and specifically
decided’” (id. at 810, quoting Ross v Medical Liab. Mut.
Ins. Co., 75 NY2d 825, 826 ). Moreover, “a determination will
generally not be given preclusive effect unless the resolution of the issue was
‘essential’ to the decision rendered in the first action or
“The party seeking application of collateral estoppel bears the burden of
showing that the decisive, identical issue was ‘necessarily decided’
in the prior action, while the party opposing the application of the doctrine
must demonstrate the absence of a full and fair opportunity to contest the prior
determination” (id. at 809-810, see Buechel v Bain, 97 NY2d
295, 304 , cert denied 535 US 1096 ). “The question of
whether a litigant had a full and fair opportunity to contest the prior
determination on those issues requires a case-by-case analysis of the realities
of the prior litigation, ‘including the context and other circumstances
which . . . may have had the practical effect of discouraging or deterring a
party from fully litigating the determination’” (id. at 810,
quoting Ryan v New York Tel. Co., 62 NY2d 494, supra at
The Court concludes that the State’s proposed affirmative defenses of
res judicata and collateral estoppel do not have merit.
With respect to Ms. Milner’s first Claim (Claim No. 104248), then Judge
(now Presiding Judge) Richard E. Sise held that Ms. Milner’s 2001 claim
was untimely because neither a claim was filed nor a notice of intention was
served within 90 days after Defendant’s first publication of her alleged
default (Matter of Milner v New York State Higher Educ. Servs. Corp., 4
Misc 3d 221, 222 [Ct Cl 2004], affd 24 AD3d 977 [3d Dept 2005]). In
doing so, Judge Sise applied the single publication rule (see Gregoire
v Putnam’s Sons, 298 NY 119, 124  [mass publication and
distribution of allegedly libelous matter in single edition of newspaper,
magazine, or book, gives rise one defamation cause of action that accrues on the
original publication date]) and determined that “the continued
reporting of claimant’s delinquency cannot be considered a republication
[that would initiate a new statute of limitations period] as the material
allegation, that claimant was in default, remained unchanged” (Matter
of Milner v New York State Higher Educ. Servs. Corp., 4 Misc 3d 221,
supra at 225 [emphasis supplied]). Assuming, arguendo, that the
single publication rule did not apply, Judge Sise further concluded that Ms.
Milner’s claim, nevertheless, was time-barred because Defendant had
“established that its last report was made in August 2000”
(id.). The Third Department determined that Ms. Milner’s assertion
that Defendant republished its defamatory statement when it hired a collection
agency in late 2000, likewise, was untimely such that the appellate court did
not need to consider whether those statements constituted republication
(Milner v New York State Higher Educ. Servs. Corp., 24 AD3d 977,
supra at 978).
This Court concludes that the instant Claim is not barred by application of the
doctrine of res judicata and/or collateral estoppel because the
“issues that were actually litigated, squarely addressed and specifically
decided” in those decisions were not the same as the ones posed by the
instant Claim (Ross v Medical Liab. Mut. Ins. Co., 75 NY2d 825,
supra at 826). Ms. Milner’s 2001 claim was dismissed as untimely when
measured against either the continued series of update reports to which the
single publication rule was applied (in the absence of some intervening act of
republication), or, in the alternative, Defendant’s last actions taken in
2000 (assuming, arguendo, that those could be regarded as independent
events to which a new statute of limitations applied).
Ms. Milner’s current Claim asserts, by contrast, that it accrued on
November 24, 2007, when she apparently received a letter from Defendant stating
that her request for TAP (Tuition Assistance Program) financial aid was denied.
The reason noted was that she was in default on a student loan. Claimant
alleges defamation of character, fraud, malice, failure to act, interference
with contractual relations, negligence, unfair practices and harassment.
Defendant does not appear to contest that Claimant’s 2007 application for
TAP was denied because she was “in default on a student loan”
(Affidavit of Brian Matthews in support of State’s motion, ¶
The 2007 TAP correspondence cannot fairly be construed as one of the continuing
reports of delinquency noted by Judge Sise. To the contrary, the earlier
decisions make clear that those updates ceased in 2000. Defendant has not
asserted that any similar reports or letters were issued during the intervening
period. Thus, the Court concludes that the 2007 TAP letter, coming as it did
after a seven-year hiatus, constitutes a republication of the alleged default
that commenced a new statute of limitations period (see Rinaldi v
Viking Penguin, 52 NY2d 422  [paperback edition incorporating surplus,
unbound pages from previously published hardcover book, with updated publication
date and copyright information, constituted independent act, rather than part of
continuous publication, triggering new statute of limitations period]).
Moreover, the instant Claim appears to have been served and filed within 90 days
of the asserted date of accrual (see Ex. C attached to State’s
motion papers). Thus, the earlier determinations that the 2001 claim was
untimely have no res judicata or collateral estoppel effect on the
For the reasons cited above, Defendant’s argument, likewise, is
unavailing that the law of the case, based upon Judge Sise’s 2004
decision, has fixed the accrual date for this Claim and, thus, the statute of
limitations, as sometime prior to September 1999 (see Affirmation of
Thomas R. Monjeau in support of State’s motion, ¶ 21).
The Court is satisfied, moreover, that Claimant primarily seeks monetary relief
for the damages alleged, rather than equitable relief that prays for this Court
to review Defendant’s administrative action in rejecting her application
for TAP benefits. As such, the Court finds Defendant’s arguments in this
regard to be unpersuasive (see id., ¶¶ 29-36).
HON. CHRISTOPHER J. MCCARTHY