On December 31, 2025, the Second Department issued a decision in Reels v. Emezu, 2025 NY Slip Op. 07424, holding that a referee exceeded her powers by deciding liability issues when the reference was just for an inquest on damages, explaining:
A referee derives his or her authority from an order of reference by the court, and the scope of the authority is defined by the order of reference. A referee who attempts to determine matters not referred to him or her by the order of reference acts beyond and in excess of his or her jurisdiction.
Here, the order of reference directed the referee to hear and determine an inquest on damages against the defendant as directed by the 12/19/2019 Default Judgment Order and the 2/27/2020 Order. At the inquest on the issue of damages, the referee considered, inter alia, certain investment agreements and prototypes of cellphone cases and, therefore, impermissibly considered evidence tending to defeat the plaintiff’s cause of action. Moreover, by, in effect, directing dismissal of certain causes of action because they were not viable, the referee exceeded the limited scope of her authority as defined by the order of reference. The Supreme Court had necessarily determined that the causes of action were viable in the prior order granting the plaintiff’s motion for leave to enter a default judgment, from which the defendant did not appeal.
(Internal quotations and citations omitted).