Court Boosts Manhattan Commercial Threshold to $500,000

, New York Law Journal


60 Centre St.
State Supreme Court at 60 Centre St.

New York court officials Tuesday approved raising to $500,000 the amount required for disputes to be adjudicated in Manhattan's Commercial Division, marking the first time since 2009 the amount has been increased.

The order, signed by Chief Administrative Judge A. Gail Prudenti, takes effect Feb. 17. It's expected to reduce the judges' docket size in the Commercial Division in Manhattan by roughly 20 percent, enabling more time and attention to be given to each case.

The current monetary threshold is $150,000.

"The [Administrative Board of the Courts] thought this was a recommendation that made sense going forward, taking into consideration the growing monetary value of complex commercial litigation while at the same time being mindful of the case load of the remainder of the Supreme Court civil term," said Office of Court Administration spokesman David Bookstaver.

Long a topic of discussion among the commercial bar, raising the monetary threshold was a key proposal in Chief Judge Jonathan Lippman's June 2012 Task Force Report on Commercial Litigation in the 21st Century.

The Commercial Division Advisory Council recommended the proposal to OCA last year.

"This order is a natural culmination of a process by which those involved in studying the issue reached a very healthy and constructive compromise. There was much discussion, but a consensus by all involved that this was a healthy approach," said Mark Zauderer of Flemming Zulack Williamson Zauderer. He, along with Manhattan Supreme Court Justice O. Peter Sherwood, co-chair the council sub-group that led the study on this issue.

According to Zauderer, increasing the threshold balances the need to "reserve the resources of the Commercial Division for cases of complexity and monetary significance" while allowing the division to be "reasonably accessible for cases that are less complicated or do not involve great sums of money."

"A 20 percent [reduction] is material and significant because it's that last 20 percent that can be the difference between the water boiling and turning to steam," he said. "We think that reduction will go a long way toward taking some of the pressure off."

Sherwood said in an interview that a "disproportionately large number of cases" handled in the Commercial Division are actually cases involving smaller amounts. On top of that, the judge noted, cases have become more complex, causing the number of motions filed between 2008 and 2012 to nearly double.

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