The Enforceability of Automatic Orders

The Administrative Order that establishes the “automatic orders” is part of the “Uniform Civil Rules for the Supreme Court and the County Court,” under Part 202 of the Rules. 22 NYCRR Part 202, et seq. 22 NYCRR ' 202.1(b) provides: “Waiver. For good cause shown, and in the interests of justice, the court in an action or proceeding may waive compliance with any of the rules in this Part, other than sections 202.2 and 202.3, unless prohibited from doing so by statute or by a rule of the Chief Judge.” (emphasis added).

It would appear then that the “enactment” of the “automatic orders” by Administrative Order is still governed by the discretion of the court of record and is not intended, in and of itself, to have the imprimatur of an “order of the court.” While the term “mandate” is statutorily defined as a “writ, process or other written direction, issued pursuant to law, out of a court, or made pursuant to law, by a court, a judge or person acting as a judicial officer, and commanding a court, board or other body, or an officer or other person, named or otherwise designated therein, to do or to refrain from doing an act therein specified” (General Construction Law ' 28-a), it again does not appear that the administrative order is meant to fall within this category for purposes of enforcement by a court of record.

Judiciary Law ' 753(A), in fact, states, in part: “A court of record has power to punish, by fine and imprisonment, or either, a neglect or violation of duty, or other misconduct, by which a right or remedy of a party to a civil action or special proceeding, pending in the court may be defeated, impaired, impeded, or prejudiced, in any of the following cases: 1. An attorney, counselor, clerk, sheriff, coroner, or other person, in any manner duly selected or appointed to perform a judicial or ministerial service, for a misbehavior in his office or trust, or for a willful neglect or violation of duty therein; or for disobedience to a lawful mandate of the court, or of a judge thereof, or of an officer authorized to perform the duties of such a judge” (emphasis added.).

It may be argued, then, that the reference in the Judiciary Law to a lawful mandate “of the court, or of a judge thereof” refers and relates back to a court “of record.” Looking at the other Rules relative to matrimonial matters under 22 NYCRR ' 202.16 ' such as requirements for the filing of retainer agreements (22 NYCRR ' 202.16(c)); the filing of a request for judicial intervention (22 NYCRR ' 202.16(d)); the exchange and filing of expert witness reports (22 NYCRR ' 202.16(g)); the making of pendente lite applications (22 NYCRR ' 202.16(k)); etc. ' a sitting judge ultimately has the discretion as to how non-compliance will be addressed. There does not, however, appear to be any case in which violation of any of those rules ' even where apparently mandatory ' has resulted in a contempt finding. They may be rule violations, but they are not treated as violations of court orders.

This different treatment of rules vis ' vis court orders is consistent, for example, in examining other portions of the Uniform Rules such as where a party is making an application relative to discovery and an affirmation of good faith is mandated (22 NYCRR ' 202.7(a)), or where one is seeking interim relief and notice to the other party of the application must be given unless proper cause is shown with an affirmation as to either scenario accompanying the application (22 NYCRR ' 202.7(f)). If compliance does not occur, the applications are not supposed to be made or heard. A violation of these motion rules ' for example, failing to file a request for judicial intervention within 45 days (22 NYCRR ' 202.16(d)); not including a proper Net Worth Statement in a pendente lite application (22 NYCRR ' 202.16(k)(2)); not filing a retainer agreement within 10 days of a substitution of counsel (22 NYCRR ' 202.16(c)(1)); not complying with the “Matrimonial Rules” where seeking counsel fees (Julien v. Machson, 245 AD2d 122 (1st Dept 1997); Bentz v. Bentz, 71 AD3d 931 (2nd Dept 2010); Wagman v. Wagman, 8 AD3d 263 (2nd Dept 2008) ' has consequences which may be generally preclusive in nature, but which are not considered contemptuous on their own.

The 'Binding' Quality

The automatic orders are particularly vexing, though, because the “binding” quality is almost secondary to its service with the summons. What if the plaintiff does not serve them? Is the action a nullity? Would the plaintiff be in contempt? Neither the rule nor the statute, for that matter, specifically says the orders must be filed with the summons, or at all. They say only that the orders will be served and be binding upon the plaintiff when the summons is filed and upon the defendant when the orders are served with the summons. This may appear to be a case of splitting hairs, but when the issue of contempt is raised, the order alleged to have been violated must be a “lawful mandate of the court” (Judiciary Law ” 753(A)(1) and (3)) and must also be “clear and unequivocal” (McCain v. Dinkins, 84 NY2d 216 (1994).) The Administrative Rule would appear not to be intended to be the former, nor is it unequivocally the latter.

The Statute and the Rule

The automatic orders codified in the Domestic Relations Law establish that both parties are to be prevented from committing certain enumerated acts. The statute, like the rule, aims to prevent either spouse from transferring or encumbering real and personal property and retirement funds, accumulating unreasonable debt and changing beneficiaries on existing health and life insurance policies. The Uniform Rule, however, assists in the implementation of the statute by the court of record. Interestingly, the statute may serve to be more effective than the rule. While the violation of a legislative enactment may not also subject the perpetrator to a finding of contempt, failure to comply with statutorily binding mandates may constitute a per se violation that does not need to be held up to the “clear and unequivocal” standard.

Take, for example, the “Automatic Stay” which is a statutory creation in Bankruptcy Court. A violation of that automatic stay results in all actions taken in violation being deemed void, even though there is no court order. E. Refractories Co., Inc. v Forty Eight Insulations, Inc., 157 F3d 169 (2nd Cir., 1998). (There is even an extensive discussion in Haile v New York State Higher Education Services Corp., 90 BR 51 (WD NY 1998) as to whether or not the violation of the automatic stay subjects the violator to contempt, although New York's Judiciary Law would foreclose that scenario in a state proceeding due to the “judicial mandate” requirement. See also Matter of Ngan Gung Restaurant, Inc., 195 BR 593 (SD NY 1996). The Bankruptcy Code does permit recovery of actual damages, including counsel fees, for a willful violation of the automatic stay under ' 362(h).)

Similarly, where there is a violation of the automatic stay effective upon an application to be relieved as counsel under CPLR ' 321, any action taken will be subject to vacatur. Moray v Koven & Krauss, Esqs., 15 NY3d 384 (2010). Of course, there remain remedies for a violation of the automatic orders under the statute or the rule. The court retains the ability to enforce both ' just not by contempt ' and may fashion whatever equitable remedy it deems appropriate, including ordering return of the property, allocation of debt, direction of reinstatement, etc. See Calicchia v. Calicchia, 204 AD2d 506 (2nd Dept 1994). Sanctions may also apply if the violation is frivolous (22 NYCRR ' 130-1.1) and the offending party may also be deemed to have engaged in waste (DRL
” 236B(5)(d), (5-a) and (6)(a)).

Conclusion

The practitioner's best remedy when faced with a potential violation of the “automatic orders” is to move for relief with a temporary restraining order that, at least in part, asks the court to sign off on the orders as part of the Temporary Restraining Order. There would seem no reason for the court not to sign it, although, inexplicably, in Valentin v. Valentin, 32 Misc3d 1223(A) (Sup Court Queens County 2011, Jackman-Brown, J.), the court declined to grant a request for a restraining order on motion holding as follows: “The Court notes that Defendant was served with the Notice of Automatic Orders on January 18, 2011. Pursuant to DRL ' 236(B)(2)(b), Defendant was bound by the automatic orders upon service on January 18, 2011. Therefore, as Defendant is bound by the Automatic Orders as provided in DRL ' 236(B)(2)(b)(1), the Court denies Plaintiff's application as moot.”

Notwithstanding the Valentin decision, best practice would still be to move for relief. Further, in all cases, if not already issued, counsel should require a stipulated provision in the preliminary conference order stating that the parties acknowledge, agree, and are deemed to remain bound by the “automatic orders” attached to the Summons and referenced in the Rules and the Domestic Relations Law. In either scenario, non-compliance will then be a violation of a judicial mandate and contempt will lie as an additional remedy for willful violation.

Lee Rosenberg is a partner at Saltzman Chetkof & Rosenberg LLP in Garden City, and a member of this publication's Board of Editors. He is a fellow of the American Academy of Matrimonial Lawyers. E-mail: [email protected].

The purpose of the Administrative Rules at Title 22 of the New York Code of Rules and Regulations (NYCRR) is clearly to assist in the implementation of court policy and administration, as is set forth in the Preamble of the Rules of the Chief Judge: “The purpose of these standards and policies is to assign and regulate administrative authority in a complex, multi tiered court system.” Rules of the Chief Judge, Part 1. Standards and Administrative Policies: General; 22 NYCRR ' 1.0. The general powers and duties of the Chief Administrative Judge are to “supervise on behalf of the Chief Judge the administration and operation of the unified court system” and, as relevant to the issue at hand, “adopt administrative rules for the efficient and orderly transaction of business in the trial courts, including but not limited to calendar practice, in consultation with the Administrative Board of the Courts or the appropriate Appellate Divisions.” Rules of the Chief Judge, Part 80. Administrative Delegation Number 1: Chief Administrator of the Courts: General Powers and Duties; 22 NYCRR ' 80.1

The Rules of the Chief Administrative Judge ' referencing items that were governed prior to the establishment of Chief Administrator of the Courts ' are required to be consistent with the powers designated under the Rules of the Chief Judge. They state in part: “All administrative regulations, rules, orders and directives for the efficient and orderly transaction of business in the trial courts or the administrative office for the courts in effect on March 31, 1978, adopted pursuant to authority subsequently transferred to the Chief Administrator of the Courts in accordance with article VI, section 28(b) of the Constitution, including but not limited to calendar practice, establishment of hours, terms and parts of court, assignments of judges and justices to them, and designations of administrative judges, are continued in effect until superseded, repealed or modified” (emphasis added). Rules of the Chief Administrator of the Courts, 22 NYCRR ' 103.1.

The 'Automatic Orders'

The Administrative Order that establishes the “automatic orders” is part of the “Uniform Civil Rules for the Supreme Court and the County Court,” under Part 202 of the Rules. 22 NYCRR Part 202, et seq. 22 NYCRR ' 202.1(b) provides: “Waiver. For good cause shown, and in the interests of justice, the court in an action or proceeding may waive compliance with any of the rules in this Part, other than sections 202.2 and 202.3, unless prohibited from doing so by statute or by a rule of the Chief Judge.” (emphasis added).

It would appear then that the “enactment” of the “automatic orders” by Administrative Order is still governed by the discretion of the court of record and is not intended, in and of itself, to have the imprimatur of an “order of the court.” While the term “mandate” is statutorily defined as a “writ, process or other written direction, issued pursuant to law, out of a court, or made pursuant to law, by a court, a judge or person acting as a judicial officer, and commanding a court, board or other body, or an officer or other person, named or otherwise designated therein, to do or to refrain from doing an act therein specified” (General Construction Law ' 28-a), it again does not appear that the administrative order is meant to fall within this category for purposes of enforcement by a court of record.

Judiciary Law ' 753(A), in fact, states, in part: “A court of record has power to punish, by fine and imprisonment, or either, a neglect or violation of duty, or other misconduct, by which a right or remedy of a party to a civil action or special proceeding, pending in the court may be defeated, impaired, impeded, or prejudiced, in any of the following cases: 1. An attorney, counselor, clerk, sheriff, coroner, or other person, in any manner duly selected or appointed to perform a judicial or ministerial service, for a misbehavior in his office or trust, or for a willful neglect or violation of duty therein; or for disobedience to a lawful mandate of the court, or of a judge thereof, or of an officer authorized to perform the duties of such a judge” (emphasis added.).

It may be argued, then, that the reference in the Judiciary Law to a lawful mandate “of the court, or of a judge thereof” refers and relates back to a court “of record.” Looking at the other Rules relative to matrimonial matters under 22 NYCRR ' 202.16 ' such as requirements for the filing of retainer agreements (22 NYCRR ' 202.16(c)); the filing of a request for judicial intervention (22 NYCRR ' 202.16(d)); the exchange and filing of expert witness reports (22 NYCRR ' 202.16(g)); the making of pendente lite applications (22 NYCRR ' 202.16(k)); etc. ' a sitting judge ultimately has the discretion as to how non-compliance will be addressed. There does not, however, appear to be any case in which violation of any of those rules ' even where apparently mandatory ' has resulted in a contempt finding. They may be rule violations, but they are not treated as violations of court orders.

This different treatment of rules vis ' vis court orders is consistent, for example, in examining other portions of the Uniform Rules such as where a party is making an application relative to discovery and an affirmation of good faith is mandated (22 NYCRR ' 202.7(a)), or where one is seeking interim relief and notice to the other party of the application must be given unless proper cause is shown with an affirmation as to either scenario accompanying the application (22 NYCRR ' 202.7(f)). If compliance does not occur, the applications are not supposed to be made or heard. A violation of these motion rules ' for example, failing to file a request for judicial intervention within 45 days (22 NYCRR ' 202.16(d)); not including a proper Net Worth Statement in a pendente lite application (22 NYCRR ' 202.16(k)(2)); not filing a retainer agreement within 10 days of a substitution of counsel (22 NYCRR ' 202.16(c)(1)); not complying with the “Matrimonial Rules” where seeking counsel fees ( Julien v. Machson , 245 AD2d 122 (1st Dept 1997); Bentz v. Bentz , 71 AD3d 931 (2nd Dept 2010); Wagman v. Wagman , 8 AD3d 263 (2nd Dept 2008) ' has consequences which may be generally preclusive in nature, but which are not considered contemptuous on their own.

The 'Binding' Quality

The automatic orders are particularly vexing, though, because the “binding” quality is almost secondary to its service with the summons. What if the plaintiff does not serve them? Is the action a nullity? Would the plaintiff be in contempt? Neither the rule nor the statute, for that matter, specifically says the orders must be filed with the summons, or at all. They say only that the orders will be served and be binding upon the plaintiff when the summons is filed and upon the defendant when the orders are served with the summons. This may appear to be a case of splitting hairs, but when the issue of contempt is raised, the order alleged to have been violated must be a “lawful mandate of the court” (Judiciary Law ” 753(A)(1) and (3)) and must also be “clear and unequivocal” ( McCain v. Dinkins , 84 NY2d 216 (1994).) The Administrative Rule would appear not to be intended to be the former, nor is it unequivocally the latter.

The Statute and the Rule

The automatic orders codified in the Domestic Relations Law establish that both parties are to be prevented from committing certain enumerated acts. The statute, like the rule, aims to prevent either spouse from transferring or encumbering real and personal property and retirement funds, accumulating unreasonable debt and changing beneficiaries on existing health and life insurance policies. The Uniform Rule, however, assists in the implementation of the statute by the court of record. Interestingly, the statute may serve to be more effective than the rule. While the violation of a legislative enactment may not also subject the perpetrator to a finding of contempt, failure to comply with statutorily binding mandates may constitute a per se violation that does not need to be held up to the “clear and unequivocal” standard.

Take, for example, the “Automatic Stay” which is a statutory creation in Bankruptcy Court. A violation of that automatic stay results in all actions taken in violation being deemed void, even though there is no court order. E. Refractories Co., Inc. v Forty Eight Insulations, Inc., 157 F3d 169 (2nd Cir., 1998). (There is even an extensive discussion in Haile v New York State Higher Education Services Corp., 90 BR 51 (WD NY 1998) as to whether or not the violation of the automatic stay subjects the violator to contempt, although New York's Judiciary Law would foreclose that scenario in a state proceeding due to the “judicial mandate” requirement. See also Matter of Ngan Gung Restaurant, Inc., 195 BR 593 (SD NY 1996). The Bankruptcy Code does permit recovery of actual damages, including counsel fees, for a willful violation of the automatic stay under ' 362(h).)

Similarly, where there is a violation of the automatic stay effective upon an application to be relieved as counsel under CPLR ' 321, any action taken will be subject to vacatur. Moray v Koven & Krauss, Esqs., 15 NY3d 384 (2010). Of course, there remain remedies for a violation of the automatic orders under the statute or the rule. The court retains the ability to enforce both ' just not by contempt ' and may fashion whatever equitable remedy it deems appropriate, including ordering return of the property, allocation of debt, direction of reinstatement, etc. See Calicchia v. Calicchia , 204 AD2d 506 (2nd Dept 1994). Sanctions may also apply if the violation is frivolous (22 NYCRR ' 130-1.1) and the offending party may also be deemed to have engaged in waste (DRL
” 236B(5)(d), (5-a) and (6)(a)).

Conclusion

The practitioner's best remedy when faced with a potential violation of the “automatic orders” is to move for relief with a temporary restraining order that, at least in part, asks the court to sign off on the orders as part of the Temporary Restraining Order. There would seem no reason for the court not to sign it, although, inexplicably, in Valentin v. Valentin , 32 Misc3d 1223(A) (Sup Court Queens County 2011, Jackman-Brown, J.), the court declined to grant a request for a restraining order on motion holding as follows: “The Court notes that Defendant was served with the Notice of Automatic Orders on January 18, 2011. Pursuant to DRL ' 236(B)(2)(b), Defendant was bound by the automatic orders upon service on January 18, 2011. Therefore, as Defendant is bound by the Automatic Orders as provided in DRL ' 236(B)(2)(b)(1), the Court denies Plaintiff's application as moot.”

Notwithstanding the Valentin decision, best practice would still be to move for relief. Further, in all cases, if not already issued, counsel should require a stipulated provision in the preliminary conference order stating that the parties acknowledge, agree, and are deemed to remain bound by the “automatic orders” attached to the Summons and referenced in the Rules and the Domestic Relations Law. In either scenario, non-compliance will then be a violation of a judicial mandate and contempt will lie as an additional remedy for willful violation.

Lee Rosenberg is a partner at Saltzman Chetkof & Rosenberg LLP in Garden City, and a member of this publication's Board of Editors. He is a fellow of the American Academy of Matrimonial Lawyers. E-mail: [email protected].