Walker v. GlaxoSmithKline, LLC

2022 NY Slip Op 00484

William Walker, Appellant, v. GlaxoSmithKline, LLC, et al., Respondents, et al., Defendants.

No. 531793

Supreme Court of New York, Third Department

January 27, 2022

Calendar Date: November 17, 2021

Powers & Santola, LLP, Albany (Michael J. Hutter of counsel) for appellant.

Hannigan Law Firm PLLC, Delmar (Timothy C. Hannigan of counsel), for respondents.

Before: Egan Jr., J.P., Clark, Aarons, Reynolds Fitzgerald and Colangelo, JJ.

AARONS, J.

Appeal from an order and judgment of the Supreme Court (O'Connor, J.), entered July 20, 2020 in Albany County, which, among other things, denied plaintiff's motion to dismiss the ninth affirmative defense in the answer of defendants GlaxoSmithKline, LLC, GlaxoSmithKline, PLC, GSK USA and Stiefel Laboratories, Inc. to the fourth amended complaint.

In 2011, plaintiff was allegedly injured while working at a pharmaceutical plant owned and operated by defendants GlaxoSmithKline, LLC and Stiefel Laboratories, Inc. Plaintiff filed a claim for workers' compensation benefits, wherein he listed Manpower, Inc. as his employer. A C-2 form was filed by "GlaxoSmithKline [doing business as] GlaxoSmithKline" reporting plaintiff's injury and naming Old Republic Insurance Company in care of Broadspire (hereinafter Old Republic) as its workers' compensation carrier. Manpower likewise filed a C-2 form and named New Hampshire Insurance Company as its workers' compensation carrier. Old Republic controverted the claim on the basis that plaintiff was an employee of Manpower and advised the Workers' Compensation Board that Sedgwick CMS, New Hampshire Insurance Company's claim servicer, had already paid benefits to plaintiff. Following a hearing in 2012, a Workers' Compensation Law Judge (hereinafter WCLJ) decided, among other things, that Old Republic be discharged and removed from notice of the proceeding.

Plaintiff thereafter commenced this action in 2014. In December 2015, a fourth amended complaint was filed. GlaxoSmithKline, LLC, Stiefel Laboratories, Inc., defendant GlaxoSmithKline, PLC, and defendant GSK USA (hereinafter collectively referred to as defendants) served an answer in July 2019 to the fourth amended complaint, raising, as relevant here, Workers' Compensation Law §§ 11 and 29 (6) as their ninth affirmative defense. Plaintiff rejected this answer as untimely. Plaintiff subsequently moved for partial summary judgment. Defendants cross-moved for, among other things, an order compelling plaintiff to accept their answer to the fourth amended complaint and, in a September 2019 order, Supreme Court, as relevant here, granted defendants' cross motion to this extent. Plaintiff thereafter moved for dismissal of defendants' Workers' Compensation Law affirmative defense. Defendants moved for summary judgment dismissing the fourth amended complaint based upon this defense. In a July 2020 order and judgment, the court granted defendants' motion and denied plaintiff's motion. Plaintiff appeals.

Plaintiff first argues that Supreme Court erred in compelling him to accept defendants' answer to the fourth amended complaint. ^[1] A court may "compel the acceptance of a pleading untimely served[] upon such terms as may be just and upon a showing of a reasonable excuse for delay or default" (CPLR 3012 [d]). Whether a reasonable excuse exists is a determination to be made based on various factors, including the extent of the delay, the prejudice to the opposing party, whether there has been any willfulness and whether, as relevant here, the untimely answer sets forth a meritorious defense (see Dinstber v Allstate Ins. Co., 75 A.D.3d 957, 958 [2010]; Watson v Pollacchi, 32 A.D.3d 565, 565 [2006]). A court may also consider whether a defendant intended to abandon its affirmative defense (see Rickert v Chestara, 56 A.D.3d 941, 942 [2008]).

The record reflects that defendants' delay of approximately 3½ years before serving an answer to the fourth amended complaint was substantial. Supreme Court considered this delay but noted that there was no indication that the delay was willful. In this regard, defendants' counsel, who was substituted in 2017 to represent defendants, had believed that prior counsel had served an answer in 2015 to plaintiff's third amended complaint with the Workers' Compensation Law affirmative defense raised therein. Although an answer to the third amended complaint was not actually served, the parties still proceeded with discovery as though it had been, and plaintiff served the note of issue in February 2019 certifying that all pleadings had been served. Defendants' counsel first learned in May 2019, when plaintiff moved for partial summary judgment, that an answer had not been interposed and then immediately investigated this error. Once an investigation confirmed the error, defendants served the answer at issue and asked the court for a conference to address the lack of a timely answer to the fourth amended complaint. As such, the court did not err in finding that any delay was not willful.

Supreme Court also considered plaintiff's claim of prejudice - i.e., that he prepared for trial under the impression that defendants were not relying on the Workers' Compensation Law affirmative defense. The court nonetheless adjourned the trial date, permitted discovery on this issue and allowed plaintiff to make an application for costs and expenses incurred in connection with his trial preparation. The record likewise supports the court's finding that defendants did not intend to abandon the Workers' Compensation Law affirmative defense. Based on the foregoing ^[2] and taking into account the strong public policy of adjudicating disputes on the merits (see Dawson v Suburban Sales & Serv., 267 A.D.2d 733, 734 [1999]), the court providently exercised its discretion in granting that part of defendants' cross motion compelling plaintiff to accept defendants' answer to the fourth amended complaint (see Puchner v Nastke, 91 A.D.3d 1261, 1262-1263 [2012]; Dinstber v Allstate Ins. Co., 75 A.D.3d at 958-959; Rickert v Chestara, 56 A.D.3d at 942-943; Watson v Pollacchi, 32 A.D.3d at 565-566).

Turning to plaintiff's motion to dismiss defendants' Workers' Compensation Law affirmative defense, plaintiff argues that defendants should be barred from relying on it based upon judicial estoppel. ^[3] This is an equitable doctrine, also known as estoppel against inconsistent positions, and provides that "where a party assumes a certain position in a legal proceeding, and succeeds in maintaining that position, ... [it] may not thereafter, simply because [its] interests have changed, assume a contrary position" (Shapiro v Butler, 273 A.D.2d 657, 659 [2000] [internal quotation marks and citations omitted]; see 12 New St., LLC v National Wine & Spirits, Inc., 196 A.D.3d 883, 884 [2021]; Maas v Cornell Univ., 253 A.D.2d 1, 5 [1999], affd 94 N.Y.2d 87 [1999]; Shepardson v Town of Schodack, 195 A.D.2d 630, 632 [1993], affd 83 N.Y.2d 894 [1994]).

Defendants, in the course of plaintiff's Workers' Compensation Law proceeding, took the position in a C-7 form controverting plaintiff's claim that plaintiff "was a temporary employee through Manpower." The C-7 form also provided that Old Republic reserved the right to develop the issue of employer-employee relationship. In a prehearing conference statement form, defendants asserted that plaintiff "was an employee of Manpower," that the claim should be the responsibility of Sedgwick, Manpower's workers' compensation carrier, that "there [was] no employer/employee relationship between [plaintiff] and [them]" and, "[a]s such, [Old Republic was] not the proper carrier." The prehearing conference statement form also noted that Sedgwick was the proper carrier responsible for payment because it was the carrier for plaintiff's employer. In a subsequent letter to the Workers' Compensation Board, counsel for Old Republic reiterated that plaintiff was an employee of Manpower and not an employee of defendants and that Sedgwick, as the proper carrier, already paid benefits to plaintiff.

In view of the foregoing, the record makes clear that defendants, through Old Republic, consistently advanced in the Workers' Compensation Law proceeding the theory that plaintiff was not its employee. Old Republic, as the workers' compensation carrier for defendants, was subsequently discharged from this proceeding. As such, defendants achieved its desired result after asserting the lack of an employer-employee relationship. Although the record is not explicit as to the basis for the discharge of Old Republic from the Workers' Compensation Law proceeding, "[t]he policy behind judicial estoppel would not be served by limiting its application to cases where the legal position at issue was ruled upon in the context of a judgment" (12 New St., LLC v National Wine & Spirits, Inc., 196 A.D.3d at 886 [internal quotation marks and citation omitted]).

In this action, however, defendants have taken a contrary position - i.e., plaintiff was employed by defendants as a special employee and, therefore, his sole remedy for compensation was to pursue workers' compensation benefits. Allowing defendants to argue in this action that plaintiff was their employee, after they had disavowed an employer-employee relationship in the Workers' Compensation Law proceeding and received a benefit from this position, would subvert the equitable policy behind the doctrine of judicial estoppel. Because judicial estoppel precludes defendants from relying on the Workers' Compensation Law affirmative defense (see D & L Holdings v Goldman Co., 287 A.D.2d 65, 71-72 [2001], lv denied 97 N.Y.2d 611 [2002]) plaintiff's motion to dismiss this affirmative defense should have been granted. In view of this determination, d...