S & I Electronics PLC v Pursco Group Ltd.
Annotate this CaseDecided on December 30, 2011
Supreme Court, New York County
S & I Electronics PLC, Plaintiff,
against
Pursco Group Limited, Defendant.
117748/09
Plaintiff:
Reed Smith LLP
599 Lexington Avenue
New York, NY 10022
212-521-5400
Defendant:
Steven Zalewski & Associates, P.C.
125-10 Queens Boulevard, Suite 218
Kew Gardens, NY 11415
718-263-6800
Doris Ling-Cohan, J.
The following papers, numbered 1-5 were considered on this order to show cause to vacate default judgment:
PAPERSNUMBERED
Notice of Motion/Order to Show Cause, — Affidavits — Exhibits1, 2, 3
Answering Affidavits — Exhibits ________________________________4
Replying Affidavits5
Cross-Motion:[ ] Yes[ X ] No
Upon the foregoing papers, defendant Pursco Group Limited's motion to vacate a default [*2]judgment entered against it is denied, as detailed below.
Background
Plaintiff S & I Electronics PLC commenced this action, on or about December 23, 2009, by filing a motion for summary judgment in lieu of complaint, to enforce a judgment obtained by plaintiff in the High Court of Justice, Queen's Bench Division, Commercial Court ("the English judgment"), upon defendant's default. Such motion for summary judgment in lieu of complaint was granted upon default of defendant, by order of this court dated March 24, 2010. Thereafter, on or about April 15, 2010, judgment was entered against defendant for a total sum of $284,992.22, based upon the English judgment.
Defendant now moves, by order to show cause, to vacate the within default judgment alleging that it was never personally served and that plaintiff is not owed the monies alleged. Defendant claims that it became aware of this action and judgment when it learned of a restraint on its bank account, on or about May 19, 2010. [¶6, Affidavit in Support].
At the outset the court must note that while defendant admits to receiving notice of this action on or about May 19, 2010, slightly over a month from entry of the default judgment against it, defendant waited almost one year, until May 13, 2011, to file the within motion to vacate the default judgment, without any explanation.
In an affidavit submitted by Omesh Pursnani (Pursnani), a principal of defendant, defendant claims that it did not receive personal service of the motion in lieu of complaint in time to defend, since process was served on the Secretary of State, who had an incorrect business address for defendant. Id. at ¶¶ 3 and 4. According to Pursnani, the business had vacated 111 Third Avenue, New York, NY, the address on file with the Secretary of State, in January 2009, prior to the commencement of this action. Id.
Defendant further asserts that it has a meritorious defense with regard to plaintiff's claims against it. According to Pursnani, plaintiff is not owed the amount alleged, that plaintiff has been paid in full and that plaintiff owes defendant $142,542.66. Id. at ¶ 10.
In opposition, plaintiff argues that defendant failed to supply a sufficient basis to warrant vacatur of the default judgment. Specifically, plaintiff asserts that defendant's motion is untimely, as it was not made within one year from service of a copy of the judgment with notice of entry, as required by CPLR 5015(a)(1). Further, plaintiff maintains that service was proper in that defendant was served via the Secretary of State at the address on file for service, and that defendant's failure to update the New York City Department of State as to its address, does not constitute a reasonable excuse to justify vacatur of a default judgment. Moreover, plaintiff's counsel indicates that prior to the commencement of this action, plaintiff's counsel communicated with an attorney who had represented defendant previously, Dustin Bowman, and supplied a courtesy copy of the pleadings, as requested by Mr. Bowman, yet, defendant defaulted in appearing in this case.
Discussion
Defendant's order to show cause does not recite the statutory provision in which defendant relies in seeking vacatur. However, the attorney's affirmation in support of defendant's order to show cause asserts relief pursuant to CPLR §317 and CPLR §5015(a)(1).
CPLR §317 permits a defendant who has not been personally served, and has failed to [*3]appear, to defend the action within one year after the defendant obtains knowledge of entry of the judgment, but in no event more than five years after such entry, "upon a finding of the court that he did not personally receive notice of the summons in time to defend and has a meritorious defense." Eugene Di Lorenzo, Inc. v A.C. Dutton Lumber Co., 67 NY2d 138, 141 (1986) (internal citations omitted). This section does not require the defendant to demonstrate a reasonable excuse for the delay. Id. at 141.
In order to vacate a default judgment pursuant to CPLR §5015(a)(1), "excusable default", a motion must be made within one year of service of a copy of the judgment with notice of entry and defendant has the burden of demonstrating both: (1) a reasonable excuse for the default; and (2) a meritorious defense to the action. Navarro v A. Trenkman Estate, Inc., 279 AD2d 257, 258 (1st Dept 2001); Cedeno v. Wimbledon Building Corp., 207 AD2d 297 (1st Dept 1994).
Here, defendant has not established that vacatur of the default judgment is warranted under either CPLR §§317 or 5015. With respect to vacatur pursuant to CPLR §5015, the within motion is untimely, as it was made more than one year from service of a copy of the judgment with notice of entry.Here, the within order to show cause was filed on May 12, 2011; however, defendant was served with the default judgment with notice of entry on April 6, 2010, over one year prior. [Exh. C, Affirmation in Opposition].
Further, while defendant claims that it was improperly served in this case, defendant has submitted plaintiff's affidavit of service showing that service was made via the Secretary of State on December 23, 2009 (Order to Show Cause, Exh C). As defendant is a corporation, service upon the Secretary of State is proper pursuant to Business Corporation Law § 306. Although defendant maintains that the address on file with the Secretary of State was not a correct address for defendant, plaintiff reasonably relied on the address it obtained through the Secretary of State, and it was defendant's responsibility to update its address. Cedeno v Wimbledon Bldg. Corp., 207 AD2d 297, 298 (1st Dept 1994)(indicating that "it is a corporation's obligation to keep on file with the Secretary of State the current address of an agent to receive service of process...and failure to meet that obligation will not constitute reasonable excuse to vacate a default judgment..." [citations omitted]).
Significantly, while defendant's principal states in a conclusory manner that "[m]y corporation vacated [the address on file with the Secretary of State, 111 Third Ave, New York, NY] in January 2009, prior to the commencement of this action (as well as the related Queen's Bench action)" [¶4, Pursnani Affidavit], noticeably absent from all of defendant's submissions is an unequivocal statement from defendant as to its correct business address.
Further, defendant's principal's allegation that defendant vacated the 111 Third Avenue address prior to the commencement of this case is disingenuous, in that, defendant's principal testified during a March 29, 2011 deposition in another case in which defendant was a party, that the business address of defendant was 111 Third Avenue, New York, NY. [Exh. E, Affirmation in Opposition, at 5, lines 14-15]. In reply, defendant has failed to supply an affidavit from its principal to refute or clarify his deposition testimony. As indicated, the 111 Third Avenue address is the same address on file with the Secretary of State, where the within pleadings were served, as well as notice of entry of the judgment.
Also noticeably absent from defendant's submissions is a Reply Affirmation by Mr. Bowman, the attorney who represented defendant previously and had communicated with [*4]plaintiff's counsel prior to the commencement of this case, to dispute plaintiff's counsel's assertions. It is noted that, while attorney Bowman has not filed the within order to show cause on behalf of defendant, according to the submissions before this court, the attorneys representing defendant at this juncture, Steven Zalewski & Associates, P.C., have an office in the same suite, as attorney Bowman.
Furthermore, defendant has failed to adequately set forth a meritorious defense. Aside from defendant's conclusory statements that a meritorious defense exists, defendant has failed to provide any admissible evidence of any alleged payments, such as invoices, bank statements, or cashed checks. Instead, defendant proffers a table, alleged to be from defendant's ledger, purporting to show that plaintiff owes defendant monies. This unauthenticated table, without more, is inadequate to prove that a meritorious defense exists in this action. While defendant, in its attorney's Reply Affirmation, lacking in personal knowledge, submits unexplained "invoices", they are unauthenticated, not in admissible form, and were not submitted in the moving papers. As such, defendant's order to show cause to vacate the default judgment is denied.
Accordingly, it is
ORDERED that the defendant's order to show cause to vacate the default judgment is denied; and it is further
ORDERED that, within 30 days of entry, plaintiff shall serve upon defendant a copy of this decision and order, together with notice of entry.
This constitutes the Decision and Order of the Court.
Dated:December 30, 2011
DORIS LING-COHAN, J.S.C.
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