WALL STREET ASSOCIATES v. Bruce A. Rich, et al., Defendants-Appellants.

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Supreme Court, Appellate Division, First Department, New York.

WALL STREET ASSOCIATES, Plaintiff-Respondent, v. Edward BRODSKY, et al., Defendants, Bruce A. Rich, et al., Defendants-Appellants.

Decided: June 25, 2002

TOM, J.P., BUCKLEY, ELLERIN, RUBIN and GONZALEZ, JJ. Joseph S. Rosenthal, Plaintiff-Respondent. Andrew H. Bart, Defendants-Appellants.

Order, Supreme Court, New York County (Edward Lehner, J.), entered July 23, 2001, which, in an action for legal malpractice against members of a now defunct firm, insofar as appealed from, denied the joint motion in limine of certain defendants seeking to preclude the reading at trial of certain deposition testimony of plaintiff's principal as barred by the Dead Man's Statute, and granted plaintiff's cross motion for a ruling that such testimony is not barred by the Dead Man's Statute, unanimously modified, on the law and the facts, to grant defendants' motion and deny plaintiff's cross motion, and otherwise affirmed, without costs.

The deposition testimony was given by plaintiff's principal and described the allegedly negligent advice given by one of defendants, who died shortly after this deposition before his own deposition was taken.   Since this deposition testimony may be central to the resolution of the action, the IAS court's ruling that it is not precluded by the Dead Man's Statute “affects a substantial right” of defendants, and, accordingly, is appealable (CPLR 5701[a][2][v] ) (cf., MacMillan v. Kavanaugh, 267 A.D.2d 1014, 701 N.Y.S.2d 198).

 All sides appear to acknowledge, at least for present purposes, that plaintiff's principal is precluded by the Dead Man's Statute (CPLR 4519) from testifying at trial as to his conversations with the deceased defendant.   Although the protections afforded by the Dead Man's Statute cannot be waived during disclosure proceedings, such as the taking of a deposition of an interested witness (Phillips v. Kantor & Co., 31 N.Y.2d 307, 313-314, 338 N.Y.S.2d 882, 291 N.E.2d 129), the IAS court nevertheless held, citing Siegel v. Waldbaum, 59 A.D.2d 555, 397 N.Y.S.2d 144 [2nd Dept., 1977], that plaintiff's principal's deposition was “former testimony”, and thus not precluded by the Dead Man's Statute.   However, “[w]here Rule 4519 renders a witness incompetent (and the witness's testimony inadmissible), the fact that the testimony would fall within an exception to the hearsay rule is simply irrelevant” (Rosenfeld v. Basquiat, 78 F.3d 84, 89 [2nd Cir., 1996] ).   “Since the purpose of CPLR 4519 is adversarial balance”, deposition testimony should be held inadmissible under the Dead Man's Statute where, as here, the deceased never had his own deposition taken on the relevant matter (see, Alexander, Practice Commentaries, McKinney's Cons. Laws of N.Y., Book 7B, C4519:5, at 179).   We note that the procedural posture here involves a motion in limine, and “ ‘[it] is always possible that the incompetency will be waived at the trial, or the door opened, by design, or by inadvertence’ ” (Phillips, supra, at 314, 338 N.Y.S.2d 882, 291 N.E.2d 129).