On December 11, 2024, the Second Department issued a decision in R & G Brenner Income Tax Consultants v. Gilmartin, 2024 NY Slip Op. 06229, holding that counterclaims that relate to the plaintiff’s claims are not time-barred, explaining:
The Supreme Court erred in granting that branch of the plaintiff’s motion which was to dismiss the defendant’s counterclaims as time-barred. Under CPLR 203(d), claims and defenses that arise out of the same transaction as a claim asserted in the complaint are not barred by the Statute of Limitations, even though an independent action by defendant might have been time-barred at the time the action was commenced. Here, since both the plaintiff’s claims and the defendant’s counterclaims allege breaches of the employment agreements, the defendant’s counterclaims arose from the same transactions and occurrences as the plaintiff’s claims and should not have been dismissed as untimely.
(Internal citations omitted).