Eclair, Inc. v Barnett

[*1] Eclair, Inc. v Barnett 2005 NY Slip Op 50655(U) Decided on March 16, 2005 Civil Court, New York County Scarpulla, J. 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 March 16, 2005
Civil Court, New York County

Eclair, Inc., Plaintiff,

against

Lois Joy Barnett, d/b/a Lois Sweet Sensations,, Defendant.



14704 CV 2002



For the Plaintiff:For the Defendant:

Linda Strumpf, Esq.Stephen D. Fink, Esq.

111 John Street, Suite 800118-35 Queens Blvd., Suite 1220

New York, New York 10038Forest Hills, New York 11375

(212) 566-6800(718) 261-5550

Saliann Scarpulla, J.

In this fourteen-year-old action for goods sold and delivered, defendant Lois Joy Barnett d/b/a Lois Sweet Sensations ("Barnett") moves by order to show cause to vacate a default judgment entered against her on September 30, 1991 by plaintiff Eclair, Inc. ("Eclair"). In its complaint, Eclair alleged that it sold and delivered goods to Barnett, and that she failed to pay for them. Eclair originally sought damages of $14,408.56. However, Barnett paid Eclair $7,235.60 during the course of the action. Thus, upon Barnett's failure to appear at a prearbitration conference, Eclair was awarded a default judgment in the amount of $7,710.93, plus costs.

In her order to show cause, Barnett denies that she was served with the summons and complaint, and states that the first time she became aware that a judgment had been entered against her was when she was served with an income execution order in 2004. Barnett also states that she does not believe that she owes Eclair any money, and that, if there was a debt, it would have been a corporate debt and not a claim against her individually.

In opposition to Barnett's order to show cause, Eclair's attorney argues that Barnett was [*2]personally served with the summons and complaint, and, in fact, originally defended the action, filing a pro se answer with counterclaims. Further, Eclair's attorney argues that she served a copy of the default judgment on Barnett in 1991, thus Barnett's time to move to vacate the default judgment has long since passed.

Eclair's attorney submits a number of exhibits, including an affidavit of service showing that Barnett was personally served with the summons and complaint on October 31, 1990, at 209-06 23rd Avenue, Bayside, New York. Eclair's attorney also submits a copy of Barnett's pro se answer to the complaint.

In her answer Barnett pled the affirmative defenses of failure to state a claim, statute of fraud and payment. In her counterclaims Barnett alleged breach of contract and unfair competition. In none of the affirmative defenses or counterclaims did Barnett contest the validity of service. Nor did Barnett ever claim that the debt sued upon was a corporate debt, or that she was not the proper defendant.

In addition, Eclair's attorney submits a copy of her letter to Barnett, dated October 4, 1991, in which the attorney informs Barnett of the default judgment. This letter is addressed to Barnett at 209-06 23rd Avenue, Bayside, New York. However, in the affidavit of service for the letter and judgment with notice of entry, an incorrect address, 109-06 23rd Avenue, Bayside, New York, is listed as the place where the judgment and notice of entry were mailed.[FN1]

On reply, Barnett acknowledges that at some point she was aware of the action, but maintains that she moved several times since the action was started, that she did not get notice from the Court of the prearbitration conference, and that she did not purposefully default in appearing. Barnett's attorney also claims, based upon his search of New York State Department of State records, that Eclair is an inactive corporation and that, for this reason, the default judgment should be vacated.

Discussion

Pursuant to CPLR 5015, a court may relieve a party from a default judgment entered against it on the ground of excusable default, "if such motion is made within one year after service of a copy of the judgment or order with written notice of its entry upon the moving party."[FN2] The one-year period within which to make the motion does not begin to run until service of the judgment with notice of entry is actually made. Thus, if service of the judgment with notice of entry is not made, or improperly made, the one year period does not begin to run. See Ackerson v. Stragmaglia, 176 AD2d 602 (1st Dep't 1991).

Here, Eclair's own documents show that it served the default judgment with notice of entry at the wrong address 109-06 23rd Avenue, Bayside, New York not 209-06 23rd Avenue, Bayside, New York, the address at which Barnett was served with the summons and complaint. The only other document submitted to the Court in connection with the default judgment, the [*3]2004 income execution, also lists this incorrect address. Thus, the Court finds that, because of Eclair's failure properly to serve Barnett with the default judgment at the correct address (at a minimum, the same address where Barnett was served with the summons and complaint) Barnett's time to move to vacate the default judgment has not begun to run.

In any event, the one-year period set forth in CPLR 5015(a)(1) is not a statute of limitations, and the Court has the inherent power to consider an application to vacate a default judgment made more than one year after the default judgment was entered. Pricher v. City of New York, 251 AD2d 242 (1st Dep't 1998). In this case, Eclair has not submitted any evidence to show that it attempted to execute on the default judgment at any time between 1991 and 2004. Thus, it appears that Barnett did not have notice that a default judgment was entered against her until fourteen years after the default judgment was entered, when she received notice in 2004 of the income execution. Once she received notice of the income execution, Barnett moved promptly to vacate the default judgment. In these circumstances, even if the year within which to move to vacate a default judgment has passed, the Court exercises its inherent power and considers the merits of the motion. Further, upon such consideration, the Court finds that Barnett has established a reasonable excuse for her default.

In addition to a reasonable excuse for defaulting, to vacate a default judgment the moving party must show a meritorious defense to the complaint. Goldman v. Cotter, 10 Ad3d 289 (1st Dep't 2004); Peacock v. Kalikow, 239 AD2d 188 (1st Dep't 1997). In her affidavit in support, Barnett denies owing any money to Eclair. Further, Barnett's answer contains affirmative defenses and two detailed counterclaims, in which Barnett alleges that Eclair breached the parties' agreement and unfairly competed against her. Taken together, Barnett's affidavit and her answer establish a sufficient defense to warrant vacating the default judgment.

In accordance with the foregoing, it is

ORDERED that defendant Lois Joy Barnett d/b/a Lois Sweet Sensations' motion to vacate the default judgment against her is granted; and it is further

ORDERED that the default judgment in this action and any restraining notices and/or income executions issued in connection with the default judgment are vacated; and it is further

ORDERED that defendant Lois Joy Barnett d/b/a Lois Sweet Sensations serve a copy of this order with notice of entry on the Clerk of the Court within thirty days of the date of this decision, and it is further

ORDERED that, upon such service, the Clerk of the Court is directed to restore this action to the appropriate calendar and give the parties notice of their next date of appearance.

This constitutes the decision and order of the Court.

Dated: New York, New York

March 16, 2005

E N T E R [*4]

Hon. Saliann Scarpulla, J.C.C. Footnotes

Footnote 1: The Court notes that the address listed for Barnett on the income execution issued in 2004 is also this incorrect address 109-06 23rd Avenue, Bayside, New York.

Footnote 2:After reviewing the documents submitted, including the affidavit of service, the Court is satisfied that Barnett was personally served with the summons and complaint in this action, thus vacutur of the default under CPLR 317 is not available to Barnett.