Petitioner Greater New York Automobile Dealers Association ("the Association") commenced this CPLR article 78 proceeding seeking to annul a determination by respondents Department of Motor Vehicles of the State of New York ("the DMV") and David Swarts, Commissioner of the DMV ("the Commissioner") that granted a certificate to respondent Tesla Motors New York LLC ("Tesla") to register and operate as a retail Motor Vehicle Dealer in the State of New York.

This matter arises from the November 20, 2009 application by Tesla to the DMV to register to operate a retail motor vehicle dealership. On December 29, 2009, the DMV granted Tesla's application and notified Tesla by letter of the same. On June 11, 2010, the Association — a not-for-profit trade association whose members consist of franchised motor vehicle dealers — informed the Commissioner that the approval of Tesla's application violated Vehicle and Traffic Law § 415 (7) (f), demanding the Commissioner to withdraw the Certificate of Registration granted to Tesla. The Association maintained that Tesla was a wholly-owned subsidiary of its parent corporation, Tesla Motors, Inc., which manufactures automobiles. Further, the Association noted the prohibition in section 415 (7) (f) "precluding a subsidiary of a franchisor from registering as a dealer is made clear in [Vehicle and Traffic Law] § 463 (2) (bb), which explicitly prohibits a franchisor from owning any interest in a motor vehicle dealer in New York (with certain limited exceptions not applicable here)" (Pollak letter [dated 6-11-20], petition, exhibit 6). On June 30, 2010, the DMV informed the Association that it declined to withdraw Tesla's Certificate of Registration, noting that nothing in the Vehicle and Traffic Law prohibits a wholly-owned subsidiary from being registered as a new car motor vehicle dealer.

On July 12, 2010, the Association commenced this proceeding for a judgment annulling, vacating, or revoking the approval of Tesla's application. Prior to answering, the DMV respondents moved pursuant to CPLR 3211 (a) (5) and (10) to dismiss the petition, in part, on the ground that is was barred by the statute of limitations. The Court determined that Tesla was a necessary party and [*2]directed that it be added as a respondent to this proceeding. After having been served, Tesla, in a pre-answer motion pursuant to CPLR 3211 (a) (3), (5) and (7) also moves to dismiss the proceeding, in part, on the ground that it is barred by the statute of limitations. The Association opposes both motions. On March 22, 2011, the Court entertained oral argument.

Both the DMV respondents and Tesla contend that this proceeding is untimely since the Association commenced it well over four months after the Commissioner granted Tesla's application to operate a retail motor vehicle dealership. In response, the Association argues that this proceeding is in the nature of mandamus to compel, which it contends it timely commenced within four months after the Commissioner declined the Association's demand to annul, vacate, or revoke Tesla's certificate to operate a retail motor vehicle dealership.

"The parties challenging the timeliness of [a CPLR article 78] proceeding . . . bear the burden of establishing their statute of limitations defense" (Matter of Brown v New York State Racing & Wagering Bd., 60 AD3d 107, 113 [2d Dept 2009]). "A CPLR article 78 proceeding must be commenced within four months of the time that the determination to be reviewed becomes final and binding for a proceeding in the nature of certiorari to review or within four months of the agency's or official's refusal of the party's demand for the performance of a mandatory, ministerial act for a proceeding in the nature of mandamus" (Matter of Letourneau v Town of Berne, 56 AD3d 880, 881 [3d Dept 2008]; see Matter of Best Payphones, Inc. v Dept. of Info. Tech. & Telecom., 5 NY3d 30, 34 [2005]; Matter of Catskill Regional Off-Track Betting Corp. v New York State Racing & Wagering Bd., 56 AD3d 1027, 1028 [3d Dept 2008]; CPLR 217). As the Court of Appeals has explained, "[a] strong public policy underlies the abbreviated statutory time frame: the operation of government agencies should not be unnecessarily clouded by potential litigation" (Matter of Best Payphones, Inc. 5 NY3d at 34).

Here, respondents have met their burden of demonstrating that this proceeding is time- barred (see Matter of Letourneau, 56 AD3d at 881). Despite the Association's argument that this proceeding is in the nature of mandamus to compel the DMV respondents to annul, vacate, or revoke Tesla's certificate to operate a retail motor vehicle dealership, in reality, the Association is seeking review of the issuance of the subject certificate as evidenced by its argument that the subject certificate was issued in violation of certain Vehicle and Traffic Laws (see id.; see also Matter of Vestal Teachers' Assn. v. Vestal Cent. Sch. Dist., 5 AD3d 922, 923 [3d Dept 2004]). As a proceeding in the nature of certiorari to review, it needed to be commenced within four months of the issuance of the subject certificate. Here, the proceeding was not commenced within that time frame but, rather, was commenced over six and one-half months later. As the Third Department has explained: "Allowing this proceeding to be couched in terms of mandamus would allow any party to begin anew the running of the statute of limitations in a certiorari matter by demanding recision of the original determination the party wishes to challenge" (Matter of Letourneau, 56 AD3d at 881; see Matter of Home Depot, U.S.A., Inc. v. Town Bd. of Town of Southeast, 70 AD3d 824, 826 [2d Dept 2010]).

Also contrary to the Association's argument, the DMV respondents did not have a continuing duty under the Vehicle and Traffic Law to re-evaluate the certification (see generally Vehicle and Traffic Law § 415). Accordingly, this proceeding needed to be commenced within four months after the Commissioner granted Tesla the subject certification (compare New York State Psychiatric Assn., Inc. v New York State Dept. of Health, 71 AD3d 852, 855-856 [2d Dept 2010], lv dismissed 15 NY3d [*3]769 [2010]; Janke v Community School Bds. of Community School Dist. No. 19, 186 AD2d 190, 193 [2d Dept 1992]).

Next the Association contends that it was not aggrieved by the determination until the DMV clarified who or which entity owned Tesla. The Association maintains that, while it had concerns that Tesla was owned by the manufacturer, it did not receive verification of this until its Freedom of Information Law ("FOIL") request was answered. At this point, it then made its demand to the Commissioner to annul, vacate, or revoke the subject certification.

Generally, there are two requirements for determining the finality of an agency's determination: " the agency must have arrived at a definite position on the issue inflicting actual injury, and the injury may not be significantly ameliorated either by further administrative action or steps taken by the complaining party" (Matter of Catskill Regional Off-Track Betting Corp., 56 AD3d at 1029, quoting Matter of Comptroller of City of New York v Mayor of City of New York, 7 NY3d 256, 263 [2006]). Here, there is no ambiguity regarding the finality of the issuance of the subject certificate — it was clearly issued on December 29, 2009 (see id. at 1029-1030). Further, nothing in the Vehicle and Traffic Law requires the DMV to notify the Association of a grant of certification. In any event, the record reflects, as the Association acknowledges, that the DMV posted this information on its web site within days of issuing the certificate and also informed the Association directly no later than January 8, 2010.

The Association contends that, despite the notice regarding the issuance of the certification, the DMV respondents withheld information regarding Tesla's ownership, without which it could not bring this proceeding. Tesla maintains that, since the DMV respondents created the ambiguity surrounding Tesla's ownership, they cannot now rely on a statute of limitations defense. Even accepting that argument as true,^[FN1] the Association has not demonstrated this proceeding still could not have been timely commenced. The record establishes that the DMV respondents answered the Association's FOIL request on March 16, 2009. At that point, the Association knew who owned Tesla and could have still commenced this proceeding within the applicable statute of limitations period (see Epic Sec. Corp. v City of New York, 198 AD2d 198, 199 [1st Dept 1993]). Furthermore, the record indicates that the Association had been concerned about the issues raised in this proceeding while Tesla's application was pending before the DMV respondents, having raised similar objections during the application process (see Cooper affidavit at ¶ 9 [sworn to 8-16-10]).^[FN2] Accordingly, the Court rejects this argument.

Based on the foregoing, the Court grants respondents' motions to dismiss this proceeding as untimely. Otherwise, the Court has reviewed the parties' remaining arguments and finds them either unavailing or unnecessary to reach given this Court's decision.

Accordingly, it is hereby

ORDERED AND ADJUDGED, that the motion by respondents Department of Motor Vehicles of the State of New York and David Swarts is granted; and it is further [*4]

ORDERED AND ADJUDGED, that the motion by respondent Tesla Motors New York, LLC is granted; and it is further

ORDERED AND ADJUDGED, that the petition is dismissed in its entirety.

This memorandum constitutes the Decision and Order/Judgment of the Court. The original Decision and Order/Judgment is being forwarded to the attorney for respondent DMV and David Swarts. A copy of the Decision and Order/Judgment are being forwarded together with all papers in this proceeding to the Office of the Albany County Clerk for filing. The signing of this Decision and Order/Judgment and delivery of a copy of the same to the County Clerk shall not constitute entry or filing under CPLR 2220. Counsel is not relieved from the applicable provisions of that rule with respect to filing, entry, and notice of entry of the original Decision and Order/Judgment.

SO ORDERED AND ADJUDGED.

ENTER.

Dated:May 3, 2011

Albany, New York_______________________________________

HON. KIMBERLY A. O'CONNOR

Acting Supreme Court Justice