New York Enacts AVOID Act Significantly Tightening Timelines for Third-Party Claims, by Christopher Arcitio, Esq., 12-31-2025

New York has enacted the Avoiding Vexatious Overuse of Impleading to Delay (AVOID) Act, significantly tightening the time frames for commencing third-party actions in New York civil litigation.

The Act amends CPLR 1007, the law governing third-party practice, by adding clear, front-loaded deadlines to ”ensure that all necessary parties are impleaded into a case within one year after the filing of the action.” These rules take effect on April 18, 2026 and apply to pending cases filed on or after that date, with specific provisions for cases already underway.

Overview of the AVOID Act

According to the New York State Assembly Memorandum in Support of Legislation, the AVOID Act (S8071A/A8728) was passed to address concerns that late-filed third-party claims often prolong discovery, increase costs, and delay resolution of cases.

The law requires defendants and third-party defendants to identify and add third-party defendants early in the case, or risk losing the chance to do so. This is designed to streamline litigation and reduce strategic delays in cases involving indemnity, insurance, or contribution claims.

Before the AVOID Act, CPLR 1007 had no fixed deadlines for adding third parties, and courts could manage delays using case-management tools.  The Act’s Memorandum in Support noted that each time a new third-party defendant is added to the case, the newly added party has the right to depose all the parties that have already been deposed, as well as asking for document discovery that has already been produced. “Discovery begins anew when a party joins a case”, often resulting in delay of the case.  As the old law was “silent” regarding the timetable for impleading third party defendants, the new law replaces that flexible system with specific deadlines tied to filing an answer, discovering potential third-party liability, and moving the case toward resolutions including trial.

New Deadlines Under CPLR 1007

• Contract based claims: If a third-party claim arises from a contractual relationship including indemnification obligations, insured and/or additional insured obligations, or a failure to procure insurance claims-the claim must be filed within 60 days after the defendant’s answer is served.
• Non-contract claims: For other claims, like contribution or common-law indemnification, the claim must be filed within 60 days after the defendant or third-party defendant becomes aware that the third party may be responsible for all or part of the plaintiff’s claim.

Importantly, the Act does not affect a defendant or third-party defendant’s ability to pursue a separate action for indemnity or contribution after judgment is rendered.

That said, the “awareness” rule may depend on the facts of the case and could lead to disputes about when the clock starts, especially in complex situations with multiple parties in ongoing disclosures. Further, defendants may need to seek a court order if a potential third-party defendant may have an ongoing bankruptcy proceeding that would make the action and/or subject contract subject to the “exclusive jurisdiction” of the bankruptcy court.

Deadline for Adding More Third Parties

• First third-party defendant: 45 days to add another party.
• Second third-party defendant: 30 days.
• Any additional third-party defendant: 20 days.

It should be noted that the Act permits a thirty-day extension to file third party actions amongst the parties. Any other extensions would require a court order. If it has been more than one year since the answer was filed, written consent of both the plaintiff and the court is required. Once the note of issue and certificate of trial readiness is filed, the courts are generally no longer permitted to allow any additional third-party actions.

Limits and Exceptions

Under the AVOID Act, defendants and third-party defendants generally cannot bring in new third parties once the note of issue and certificate of trial readiness is filed and a case is ready for trial. Lower courts are directed to sever or dismiss without prejudice any late third-party actions. This means all third-party claims must be filed during the pre-trial discovery phase, preventing most late attempts to shift liability to others.

However, there are narrow exceptions for third party actions against a plaintiff’s employer: If the third-party claim is against a plaintiff’s employer seeking contribution or indemnification, and the plaintiff has suffered a “grave injury” under Workers’ Compensation Law § 11, or if the employer’s identity was not reasonably known to the defendant/third party defendant until after the normal deadlines had passed.

In these limited situations, the law may set alternative deadlines, usually starting from when the employer’s identity or grave-injury status is discovered. Outside of these exceptions, all other late-identified third parties must follow the new deadlines, and any extensions may require court approval and plaintiff’s written consent.

Judicial Flexibility, Extensions, and Transition Rules

The AVOID Act now puts a “timetable” for impleading third party defendants and judges have limited flexibility in entertaining extensions for deadlines for adding third parties. Extensions can only be granted for a short time, and in some cases, the plaintiff must give written consent.

Outside the narrow exceptions for a plaintiff’s employer (grave-injury or unknown-employer situations), courts can offer only limited extensions. Once the note of issue is filed, judges are now directed to sever any post note of issue new third party action(s) and/or dismiss the action(s) without prejudice under the Act.

This gives cases closer to trial less surprise over late attempts to bring in additional parties than under the old rules, when judges entertaining motions to sever the third-party actions, balancing factors like whether discovery is complete, delay, and fairness, none of which required plaintiff’s written consent. Defendants who miss the new deadlines may find that, unless an exception applies, only written consent from the plaintiff and a court order can revive a third-party claim—and even then, relief may no longer be available if the note of issue has already been filed.

The AVOID Act applies to pending actions filed on or after its effective date. Third party actions already filed are generally not subject to the new deadlines, but defendants and third party defendants should review any unasserted third-party claims now to avoid losing the chance to add parties once the law takes effect.

Adapting Litigation Practices Under the AVOID Act

Under the AVOID Act, impacted stakeholders will need to act more quickly to identify potential third-party targets. This means:

• Identifying possible contractual indemnitors, additional insured parties, and contribution targets right at the start of the case, often before filing an answer, and commencing third party actions against all potential third-party targets regardless of whether risk transfer is underway.
• Collecting and reviewing contracts, subcontracts, purchase orders, service agreements, certificates of liability insurance, and insurance documents early, rather than waiting until mid-discovery. Delaying this work could mean missing the deadlines for adding third parties.
• Updating internal protocols and defense playbooks to include these early review steps for all new cases.

Action Steps for Stakeholders

To stay compliant and protect third-party rights, organizations should consider the following:

• Conduct early, written assessments of potential third-party claims, including employer/grave-injury exceptions.
• Retain coverage counsel to get involved early in an underlying claim and conduct early, written coverage opinions analyzing potential third party claims.
• Seek extensions to review contracts and insurance policies before the 60-day post-answer deadline and coordinate tenders to indemnitors and insured parties.
• Reach out to the plaintiff’s attorney to obtain written consent early on.
• Alert the plaintiff of potential third-party targets so that plaintiff can amend the complaint and bring the targets in as direct defendants, avoiding the AVOID Act altogether.
• File motions to vacate the note of issue and certificate of trial readiness to continue preserving third party rights in the action.
• Audit existing cases to identify unasserted third-party claims, especially in construction, premises, transportation, and product matters.
• For repeat litigants and insurers, review whether current contracting and insurance practices support early identification and preservation of risk-transfer rights.

Author: Christopher Arcitio is an Of Counsel in KD’s New York City office