Thomas R. Newman
When an appellate court reverses a judgment and remands the matter for a new trial, it is not unusual for the losing party to want to salvage something from the original trial, such as a favorable (and unexpected) jury determination on a difficult issue that is not likely to be repeated by a second jury. Conversely, the winning party wants to start with a clean slate in the hope of obtaining a better result than the one at the original trial. For example, the winning party may want to add new theories or defenses at the retrial. These competing interests sometimes engender disputes about the scope of a new trial order made by an appellate court.
“It is settled jurisprudence that when an appellate court reverses a judgment, the rights of the parties are left ‘wholly unaffected by any previous adjudication.’” Ceravole v. Giglio, 186 A.D.2d 170, 170 (2d Dept., 1992), quoting Taylor v. New York Life Ins. Co., 209 N.Y. 29, 34 (1913). “The parties are left in the same position as though there had been no trial.” ATIFA v. Shairzad, 56 A.D.3d 703, 704 (2d Dept., 2008). “Unless the appellate court in its decision and order directs that the new trial be limited in scope it ‘should be construed to require a new trial generally.’” Ceravole, 186 A.D.2d at 170-71, quoting Application of Sipal Realty, 15 A.D.2d 456, 456-57 (1st Dept., 1961). “Any other view, for which there is, concededly, no precedent, would entail recurrent uncertainty in procedure and require the litigants and the trial courts to engage in collateral interpretation or construction of an appellate court’s intention.” Sipal, 15 A.D.2d at 457.
When the Appellate Division orders a new trial, “the parties can introduce new evidence and * * * every issue of fact or law may be litigated anew.” See Halpern v. Amtorg Trading, 292 N.Y. 42, 48 (1944). In Enden v. Nationwide Mut. Ins. Co., 251 A.D.2d 283 (2d Dept., 1998), for example, the defendant insurer’s answer asserted various affirmative defenses. At the close of the defendant’s case at the first trial, the trial court dismissed the affirmative defenses, directed a verdict for the plaintiffs, and awarded damages. The Appellate Division reversed and granted a new trial. After the jury returned a verdict in favor of the defendant on the retrial, the plaintiffs appealed from the resultant judgment, arguing that the trial court erred in retrying all issues, including the defendant’s affirmative defenses. The Appellate Division affirmed the judgment, holding that “since the decision and order [on the prior appeal] reversing the judgment in favor of the plaintiffs did not explicitly limit the scope of the new trial, the trial court correctly determined that the new trial would be as to all issues, including the viability of the defendant’s affirmative defenses.” See 251 A.D.2d at 283 (material in brackets added).
Doomes v. Best Transit, 92 A.D.3d 490 (1st Dept., 2012), arose from a single-vehicle bus roll-over accident. The plaintiff passengers sued the bus company and driver on a negligence theory and the bus manufacturer on a “second collision” (crashworthiness) products liability theory (lack of passenger seatbelts in the bus). The jury returned a verdict in favor of the plaintiffs on both theories, assigning 60 percent of the fault for causing “the accident” to the driver and 40 percent to the manufacturer, but inconsistently assigning 100 percent of the responsibility for causing “the injuries” to the manufacturer due to the lack of seatbelts. Concluding that “it is inconceivable that the availability of passenger seat belts would have resulted in the complete absence of injury,” the Appellate Division ordered a new trial “to obtain a proper allocation of fault for the injuries sustained as a consequence of the lack of seat belts (as opposed to the negligent operation of the bus) and apportionment of liability under CPLR article 16.” See 92 A.D.3d at 491. Prior to the retrial, the trial court denied the manufacturer’s motion in limine for a “full scope” retrial on the issues of the manufacturer’s liability and plaintiffs’ damages. The Appellate Division modified this order to the extent of directing a “full unified retrial,” noting that “[t]o prevail under the [second collision] doctrine, plaintiffs must show by independent proof that the absence of seatbelts was a defect that ‘caused enhanced injuries,’” and holding that “[a] limited scope retrial would cause untold confusion in any attempt by the trial court to apply the second collision doctrine.” See 126 A.D.3d 629, 630 (citations omitted) (material in brackets added).
The scope of a new trial on remand is not wholly without limits, however. In ATIFA, for example, the Appellate Division reversed the judgments in two related actions, reinstated the original pleadings and granted a new trial. Prior to the retrial, the prevailing parties on the appeal moved for leave to serve supplemental and amended pleadings that raised new issues, theories and defenses in both actions. The Appellate Division affirmed the trial court’s denial of these motions, noting that its “prior decision and order did not expand the issues to be retried to include those that were never pleaded, were not addressed in discovery, and would prejudice ATIFA at the new trial.” See 56 A.D.3d at 704.
Another limitation on the scope of a new trial on remand arises from the rule that a reversal does not inure to the benefit of a nonappealing party. In Hecht v. City of New York, 60 N.Y.2d 57 (1983), the Court of Appeals limited an appellate court’s scope of review of a final judgment or order rendered against multiple parties but appealed by only one. The court noted that “[g]enerally, an appellate court cannot grant affirmative relief to a nonappealing party unless it is necessary to do so in order to accord full relief to a party who has appealed,” and that “neither CPLR 5522 [‘Disposition of appeal’] nor any other statutory or constitutional authority permits an appellate court to exercise any general discretionary power to grant relief to a nonappealing party.” Id. at 60, 63 (material in brackets added). The court held that except for “rare occasions” in which “the grant of full relief to the appealing party * * * necessarily entail[s] granting relief to a nonappealing party,” an appellate court lacks power to grant affirmative relief to a party who has not cross-appealed to it. Id. at 62. Based upon these principles, the court in Hecht ruled that a defendant found liable at trial, but which did not appeal from the judgment, could not receive the benefit of a reversal obtained at the Appellate Division by a co-defendant that did appeal. But where the liability of the successful appellant and a nonappealing party is intertwined, an appellate court may grant a new trial to all parties, including the nonappealing party. See, e.g., Cover v. Cohen, 61 N.Y.2d 261, 277 (1984).
Application of Law of the Case
A necessary corollary to the rule that the grant of a new trial generally sends the parties back to square one is the rule that courts of original jurisdiction lack the power to vary or limit the terms of an appellate court’s new trial order. Indeed, “[n]o rule of American jurisprudence is better established than the salutary one which requires a lower court to carry out faithfully the express mandate of its appellate superior.” Slotkin v. Citizens Cas. Co. of New York, 698 F.2d 154, 155 (2d Cir. 1983). This is an application of the law of the case doctrine.
In Maracina v. Schirrmeister, 152 A.D.2d 502 (1st Dept., 1989), for example, the Appellate Division granted the plaintiff partial summary judgment on the issue of liability and remanded the matter for an assessment of damages. Following jury selection, but prior to opening statements or any other proceedings before the jury, the trial court granted the defendant’s motion to dismiss the complaint, and accordingly, no trial took place. On appeal from the order of dismissal, the Appellate Division reversed, reinstated the complaint and the prior order granting partial summary judgment, and remanded the matter “again” for an assessment of damages before a different justice. The Appellate Division noted, “The respondent cites no authority, and indeed, none exists, to support the Trial Judge’s disregard of the earlier order of this court. Trial courts are without authority to vacate or modify orders of the Appellate Division, or to reverse holdings of this court.” See 152 A.D.2d at 502-03.
The lesson of these cases is clear. A finding of prejudicial error will generally result in a reversal of the judgment and a new trial on all issues unless the appellate court specifically limits the scope of the retrial. Where the appellate court finds error affecting the determination of only some of the issues, however, it may order a retrial solely as to those issues, saving the parties and the trial court the time, expense and trouble of retrying issues that were properly decided. The most common example is an order limiting the retrial to the issue of damages where the issue of liability was properly decided. The party opposing an appeal should therefore give careful consideration to whether the appellant’s points of error, if accepted by the appellate court, would require a retrial on all issues or only on some of the issues. If the latter, this should be addressed in the respondent’s answering brief.
Thomas R. Newman is of counsel to Duane Morris and author of "New York Appellate Practice" (Matthew Bender). Steven J. Ahmuty Jr. is a partner at Shaub, Ahmuty, Citrin & Spratt.
Reprinted with permission from New York Law Journal, © ALM Media Properties LLC. All rights reserved.