Brookhaven Anesthesia, Assoc., LLP. v Flaherty

[*1] Brookhaven Anesthesia, Assoc., LLP. v Flaherty 2004 NY Slip Op 51035(U) Decided on September 20, 2004 Appellate Term, Second Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on September 20, 2004
SUPREME COURT OF THE STATE OF NEW YORK
APPELLATE TERM : 9th and 10th JUDICIAL DISTRICTS
PRESENT: McCABE, P.J., COVELLO and TANENBAUM, JJ.
NO. 2003-1258 S C

BROOKHAVEN ANESTHESIA, ASSOCIATES, LLP., Respondent,

against

JAMES E. FLAHERTY, Appellant.

Appeal by defendant from so much of an order of the District Court, Suffolk County (S. Hackeling, J.), entered on May 29, 2003, as conditionally granted that branch of defendant's motion to vacate two restraining orders, and in effect denied that branch of defendant's motion seeking removal to federal court.

Order unanimously modified by granting that branch of defendant's motion seeking an unconditional vacatur of the restraining notices, and deleting those portions of the decretal as in effect directed North Fork Bank to transfer all monies held by it under the restraining order into court pending determination of the action; as so modified, affirmed without costs.

CPLR 5222 (b) provides in pertinent part that "a person other than the judgment debtor or obligor ... [served with a restraining notice] is forbidden to make or suffer any sale, assignment, or transfer of, or any interference with, any such property [of the judgment debtor], or pay over ... to any person other than the sheriff or the support collection unit, except upon direction of the sheriff or pursuant to an order of the court, until the expiration of one year after the notice is served upon him or her, or until the judgment or order is satisfied or vacated, whichever event first occurs." Once the court vacated the default judgment, the restraining notices were automatically cancelled (see Citibank v Second Development Servs., Inc., 184 Misc 2d 494 [App Term, 2d & 11th Jud Dists 2000]), and it was error for the court not to grant that branch of defendant's motion seeking to vacate the restraining notices unconditionally. [*2]

The District Court is a court of limited jurisdiction, and hence possesses no equity jurisdiction except as specifically conferred upon it by statute (NY Const, art VI § 15; Petrides v Park Hill Restaurant, 265 App Div 509 [1943]; Mormon v Acura of Valley Stream, 190 Misc 2d 697 [App Term, 9th & 10th Jud Dists 2001]). Even assuming that prior to vacating the default judgment, the court possessed the authority pursuant to CPLR 5222 (b) to, in effect, modify the restraining notice by directing the bank to transfer the funds into court, the validity of such restraining notice, as modified, was extinguished upon vacatur of the default judgment. Further, while a court may issue a pre-judgment restraining order pursuant to CPLR 5229, this must be "upon motion of the party in whose favor a verdict or decision has been rendered," conditions which have not been satisfied herein. The disposition of the court below is thus authorized neither under CPLR 5229 nor under CPLR 5222 (b). In the absence of any statutory authority, the court did not possess the jurisdictional power to forge an equitable remedy.

Defendant's argument that the action should have been removed to federal court on the ground of federal preemption under the Employment Retirement Income Security Act (29 USC § 1001 et seq.) (ERISA) is without merit. The instant suit was commenced by Brookhaven Anesthesia Associates on a state breach of contract action. Defendant, who has the burden of establishing the basis for removal, averred that he was a beneficiary under his wife's employee benefit plan, and that it was his understanding that plaintiff was a participating provider, working under the direction and control of the primary medical provider, Long Island Eye Surgery Care. Even assuming this to be the case, defendant has failed to demonstrate that plaintiff is a "participant," "beneficiary" or "fiduciary" as defined in ERISA so as to have standing to sue under ERISA § 502 (a) (29 USC § 1132 [a]; see John Hopkins Hosp. v Carefirst of Md., Inc., 327 F Supp 2d 577, 2004 WL 1672328 [US Dist Ct, Md]). Plaintiff's cause of action thus does not come within the scope of ERISA, and is not therefore preempted by ERISA (id.).
Decision Date: September 20, 2004