Kimco Exch. Place Corp. v Thomas Benz, Inc.
Annotate this CaseDecided on November 3, 2005
Supreme Court, Nassau County
Kimco Exchange Place Corp., Plaintiff,
against
Thomas Benz, Inc., JOHN E. BENZ & CO., and THOMAS BENZ, individually, Defendants,
5391-05
COUNSEL FOR PLAINTIFF
Rosenberg, Calica & Birney, LLP
100 Garden City Plaza, Suite 408
Garden City, New York 11530
COUNSEL FOR DEFENDANTS
Edwards & Angell, LLP
750 Lexington Avenue
New York, New York 10022
Leonard B. Austin, J.
Defendants Thomas Benz, Inc., John E. Benz & Co., and Thomas Benz,
individually, move pursuant to CPLR 3211(a)(8) for an order dismissing the complaint on the grounds that the court lacks in personam jurisdiction over them.
BACKGROUND
In June 2003 and October 2004, Plaintiff, Kimco Exchange Corp. ("Kimco"), a real estate broker licensed by the State of New York, entered into two "Exclusive Marketing Agreements" with Defendants Thomas Benz, Inc. and John E. Benz & Co.
Kimco not only does business in New York, but also conducts business and markets properties as a broker and finder on a national basis, including consulting and working with brokers in other jurisdictions where appropriate and required (James Aff. in Opp., ¶ 6).
Pursuant to the subject agreements, Kimco was to market and sell certain commercial properties allegedly owned by the Defendants during specified time periods (James Aff., ¶¶ 2, 12-22; Kimco Opp., Exhs. C and F). In exchange, the Defendants agreed to pay Kimco a fee equal to 2% of the gross purchase price obtained for properties covered by the agreement. None of the subject properties are located in New York.
Defendant Thomas Benz ("Benz"), who is a resident of Palm Beach County, Florida, is engaged in the business of developing commercial real estate. He is the principal of Defendants Thomas Benz, Inc. and John E. Benz & Co., which are respectively, a Florida corporation and a Florida limited liability company. Neither entity
is authorized to do business in the State of New York and neither owns property or maintains employees in the State of New York (T. Benz Aff., ¶¶ 3-4).
According to Benz, Kimco transmitted drafts of the agreement by facsimile to him in Florida, where he executed the documents and then transmitted them back to New York. Moreover, he never personally entered New York concerning the transaction, but rather, met with Plaintiff's representative in Florida prior to the execution of the agreements (James Aff., ¶ 10; Benz Aff., ¶¶ 4-5; Benz Reply Aff., ¶ 4). He later made several follow-up telephone calls to Plaintiff at its New York office (Benz Aff., ¶ 5).
In April 2005, Kimco commenced this action to recover fees allegedly due and owing from the Defendants based on their alleged breach of the Exclusive Marketing Agreements (Complaint, ¶¶ 7, 14).
In pertinent part, the complaint alleges that properties covered by the agreement which are located in Florida, Maryland, Washington D.C. and Virginia were sold and [*2]effectively consummated during the pendency of the agreements thereby establishing Kimco's entitlement to a fee in the estimated sum of $644,736.00 (Complaint, ¶¶ 10-11, 12, 16).
Defendants now move pre-answer for an order dismissing the complaint pursuant to CPLR 3211(a)(8) on the ground that the Court lacks in personam over them.
DISCUSSION
In opposition to the motion, Kimco contends that long arm jurisdiction exists since the Defendants have purposefully availed themselves "of the benefits of the forum" (Kreutter v. McFadden Oil Corp., 71 NY2d 460, 466 [1988]) and, therefore, have transacted business in the State of New York within the meaning of CPLR 302. The Court disagrees.
CPLR 302(a) provides, in part, that "a court may exercise personal jurisdiction over any non-domiciliary, or his executor or administrator, who in person or through an agent: 1. transacts any business within the state or contracts anywhere to supply goods or services in the state; * * *."
"CPLR 302(a)(1) is a single act statute and proof of one transaction in New York is sufficient to invoke jurisdiction" even though the Defendant never enters New York. Kreutter v. McFadden Oil Corp., supra at 467 (Internal quotes omitted); Deutsche Bank Securities, Inc. v. Montana Bd. of Investments, 21 AD3d 90 (1st Dept. 2005); Edelman v. Taittinger, S.A., 298 AD2d 301 (1st Dept. 2002); and Bunkoff General Contractors Inc. v. State Auto. Mut. Ins. Co., 296 AD2d 699 (3rd Dept. 2002). To be sure, there must be "some act by which the Defendant purposefully avails itself of the privilege of conducting activities with the forum State, this invoking the benefits and protections of its laws." Hanson v. Denckle, 357 U.S. 235, 253 (1958).
However, in order to invoke jurisdiction, the evidence must demonstrate that "the Defendant's activities here were purposeful and there is a substantial relationship between the transaction and the claim asserted". Wright v. 299 Union Ave. Corp., 288 AD2d 382, 383 (2nd Dept. 2001), quoting, Kreutter v. McFadden Oil Corp., supra at 467. See also, Johnson v. Ward, 4 NY3d 516, 519-20 (2005); and Armouth International, Inc. v. Haband Co., Inc., 277 AD2d 189 (2nd Dept. 2000). Indeed, the Court of Appeals has very recently emphasized that "a 'substantial relationship' must be established between a Defendant's transactions in New York and a Plaintiff's cause
of action in order to satisfy the nexus requirement of the statute." Johnson v. Ward, supra at 519.
Moreover, "an essential criterion in all cases is whether the 'quality and nature' of the Defendant's activity is such that it is reasonable and fair to require him to conduct his defense in that State." Riblet Products Corp. v. Nagy, 191 AD2d 626 (2nd Dept. [*3]1993). See, Johnson v. Ward, supra; Olympus America, Inc. v. Fujinon, Inc., 8 AD3d 76 (1st Dept. 2004); Liberatore v. Calvino, 293 AD2d 217 (1st Dept. 2002); and Courtroom Television Network v. Focus Media, Inc., 264 AD2d 351 (1st Dept. 1999). See also, LaMarca v. Pak-Mor Mfg. Co., 95 NY2d 210, 216 (2000).
As the party seeking to assert personal jurisdiction, the Plaintiff bears the burden of proof on this issue. Ying Jun Chen v. Lei Shi, 19 AD3d 407 (2nd Dept. 2005); Bunkoff General Contractors Inc. v. State Auto. Mut. Ins. Co., supra; Brandt v. Toraby,
273 A.D. 429, 430 (2nd Dept. 2000). See also, O'Brien v. Hackensack University Medical Center, 305 AD2d 199 (1st Dept. 2003); and Armouth International, Inc. v. Haband Co., Inc., supra.
Applying the above-cited principles, and crediting the non-conclusory allegations advanced by Kimco (Brandt v. Toraby, 273 AD2d 429 [2nd Dept. 2000]; Armouth International, Inc. v. Haband Co., Inc., supra at 190. See, Maas v. Cornell University, 94 NY2d 87 [1999]), the Court agrees that Plaintiff has failed to demonstrate that the Court has personal jurisdiction over the Defendants pursuant to CPLR 302.
Here, it is undisputed that none of the relevant properties is located in New York; that the two contracting parties Thomas Benz, Inc. and John E. Benz & Co are Florida entities; and that neither Defendant entity maintains a presence in New York through the ownership of property, the maintenance of employees or, alternatively, through formal authorization to conduct business pursuant to New York law.
Nor is there evidence presented demonstrating that the agreements were negotiated in New York. Samsung America, Inc. v. GS Industries Inc., supra. Indeed, the record reveals that it was the Kimco's representative who traveled to Florida, where he met with Benz in connection with the properties listed in the Agreements; that the agreement was executed in Florida and faxed to New York; and that Benz then made certain post-execution, follow-up telephonic contacts none of which are described as substantively material or as anything more than confirmatory calls (James Aff., ¶ 10;
Benz Aff., ¶¶ 4-5; Benz Reply Aff., ¶ 4 Kimco Brief at 20). See, Barington Capital Grp., L.P. v. Arsenault, 281 AD2d 166 (1st Dept. 2001).
Plaintiff's claim that the Benz Defendants have done business with the Plaintiff since 2001, and have generated numerous e-mails and other correspondence relating to these prior involvements, is unpersuasive as a basis for sustaining jurisdiction pursuant to CPLR 302 in this matter (James Aff., ¶¶ 26-28).Significantly, it has been held that "electronic communications, telephone calls or letters, in and of themselves, are generally not enough to establish jurisdiction" unless it is established that the comminations were employed "by the Defendant deliberately to project itself into business transactions occurring within New York State" Deutsche Bank Securities, Inc. v. Montana Bd. of Investments, supra; Warck-Meister v. Diana Lowenstein Fine Arts, 7 AD3d 351 (1st Dept. 2004); Liberatore v. Calvino, 293 AD2d 217, 220 (1st Dept. 2002); Edelman v. Taittinger, S.A., supra; Samsung America, Inc. v. GS Industries Inc., 278 [*4]AD2d 138 (1st Dept. 2000); and Courtroom Television Network v. Focus Media, Inc., supra at 353 See, Olympus America, Inc. v. Fujinon, Inc., supra.
The prior involvements and attached documents none of which involve New York real property do not establish that the Defendants have "project[ed] * * * [themselves] into business transactions occurring within New York State". Deutsche Bank Securities, Inc. v. Montana Bd. of Investments, supra at 94. More particularly, the mere fact that some of the documents involved in the transaction were transmitted to
Plaintiff in New York, does not establish that the transaction, if any, to which these documents relate, bear a substantial or significant nexus to the State of New York or that the Defendants thereby projected themselves "into a business transaction occurring in New York". L. F. Rothschild, Unterberg, Towbin v. McTamney, 89 AD2d 540 (1st Dept. 1982), affd., 59 NY2d 651 (1983). See, Johnson v. Ward, supra.
Indeed, the evidence establishes that Kimco's marketing activities and solicitations are national in scope and reach. Any inference that the focus of its activities or those contemplated by the agreements were centered principally in the State of New York or that by entering into the agreements, the Defendants purposefully took advantage of any unique, New York resource or attribute is diluted thereby. Cf., Deutsche Bank Securities, Inc. v. Montana Bd. of Investments, supra.
It bears noting, in this respect, that the agreements are silent with respect to precisely where the Plaintiff's activities were to be performed and contain no clause relating to the issue of jurisdiction or choice of forum. Moreover, any activities conducted by Kimco's "in New York, on behalf of Defendant, cannot be relied on to establish the presence of the Defendant[s] in this State." Professional Personnel Mgt. Corp. v. Southwest Medical Assocs., Inc., 216 AD2d 958 (4th Dept. 1995); and J. E. T. Advertising Associates, Inc. v. Lawn King, Inc., 84 AD2d 744 (2nd Dept. 1981).
Thus, athough CPLR 302 is a "single act" statute, the evidence must still demonstrate the existence of a substantial relationship between the transaction and the
claim asserted. Johnson v. Ward, supra; Kreutter v McFadden Oil, supra; Samsung Am. v. GS Indus., supra. Upon the papers submitted, the Court concludes that the evidence fails to support Plaintiff's contention that such a relationship exists.
Accordingly, it is,
ORDERED the motion to dismiss the complaint pursuant to CPLR 3211(a)(8) by the Defendants Thomas Benz, Inc., John E. Benz & Co., and Thomas Benz, individually, is granted and the complaint is hereby dismissed.
This constitutes the decision and Order of the Court.
Dated: Mineola, NY _____________________________
November 3, 2005 Hon. LEONARD B. AUSTIN, J.S.C.
XXX [*5]
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
