First Amer. Inv. Co., LLC v Dominguez
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First Amer. Inv. Co., LLC v Dominguez 2012 NY Slip Op 30754(U) March 22, 2012 Sup Ct, New York County Docket Number: 116326/2007 Judge: Saliann Scarpulla Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. SCANNED ON 312712012 [* 1] SUPREME COURT OF THE STATE OF NEW YORK NEW YORK COUNTY - PRESENT: SALIANN SCARPULLA PART '-.StlCO 7 1 9 - 1632612007 INDEX NO. FIRST AMERICAN INVESTMENT CO., I MOTION DATE II VS. DOMINQUEZ, NESTOR /I SEQUENCE NUMBER : 001 MOTION SEQ. NO. - STRIKE ANSWER Upon the foregoing papem, It I ordered that thls motlon Is s 1 motiorl and cross-motion arc decided in accordant " with accornpanyirlg memorandum decision. .. Dated: @ CASE DISPOSED 0OTHER GRANTED IN PART 0DENIED 2. CHECK A3 APPROPRIATE: ........................... MOTION I : S GRANTED 0SUBMIT ORDER 3. CHECK IF APPROPRIATE: ................................................ SEllLE ORDER DO NOT POST 0FlDUCl ARY APPOINTMENT 0REFERENCE 1. CHECK ONE: ..................................................................... [* 2] Index No.: 116326/2007 Submission Date: 10/05/11 Plaintiff, - against- NESTOR DOMINGUEZ, For Plaintiff: Lacy Katzen LLP P.O. Box 22878 130 E s Main Street at Rochester, New York 14692 For Defendant: The Langtl Firm 225 Broadway, Suite 700 New York, NY 10007 Papers considered in review of this motion to strike defendant s answer and cross- m t o to amend answer and oin dismiss: I . Notice of Motion. . . . . . . . . . . . . 1 Aff in Support. . . . . . . . . . . . . . . 2 Notice of Cross-Motion . . . . . . . .3 Aff in Support and Opp . . . . . . . . 4 Aff in Opp . . . . . . . . . . . . . . . . .. 5 Reply Aff. . . . . . . . . . . . . . . . . . 6 HON. SALIANN SCARPULLA, J.: In an action to recover an unpaid credit card debt, plaintiff First American Investment Company, LLC ( First American ) moves to strike defendant Nestor Dominguez s ( Dominguez ) answer pursuant to CPLR 3 126(3). Dominguez crossmoves for leave to amend the answer and to dismiss the complaint for lack of standing. 1 [* 3] First American commenced this action against Dominguez, by service of a summons and cornplaint, on or around December 24,2007, alleging that Dominguez owed a $3 1,578.42 balance, plus interest, on a Citibank credit card, account number 54 10658449227006. Dominguez, proceeding pro se at the time, responded to the complaint in a letter dated January 2, 2008, addressed to First American s attorneys. First American is treating this as Dominguez s answer. Almost two years later, on or around October 14,2010, First American served Dominguez with a Notice to Admit and First Set of Interrogatories. First American received no response to these discovery demands, nor to subsequent follow-up letters requesting responses. First American now moves to strike Dominguez s answer as a result of his failure to comply with discovery demands, and to enter judgment in the amount of $3 1,578.42 with interest from June 28,2007. First American assehs that Dominguez s failure to respond to discovery demands is willful, and as such striking the answer is the appropriate remedy. In opposition, Dominguez, now represented by counsel, opposes the motion to strike and cross-moves to amend the answer to assert the defense of lack of standing and to dismiss the complaint on that ground. Dominguez argues that the complaint should be dismissed because First American cannot prove standing as an assignee of Dominguez s credit card debt, and that lack of standing requires dismissal of the action. In addition, 2 [* 4] Dominguez argues that even if First American could establish standing, striking the answer is not appropriate, and Dominguez should be given the opportunity to amend his answer and defend himself in this action. In opposition to the cross-motion and i further support of its motion, First n American argues that the motion to strike Dominguez s answer should be granted because Dominguez failed to respond to discovery requests willfully and in bad faith without justification or excuse for his failure. First Amendment further argues that leave to amend should not be granted because it is being requested for the sole purpose of circumventing plaintiff s motion to strike. Lastly, First American argues that it does have standing as the assignee of the account, and that it has submitted sufficient documentary proof. Discugsion In New York, the courts have a strong policy of resolving matters in litigation on the merits. Thus, a default which is not intentional may be excused when there is a reasonable excuse for the default and a meritorious defense to the action, Here, Dominguez has established both a reasonable excuse for his default and a meritorious defense. First, Dominguez avers that, while he was representing himself, he relied upon the poor advice of a friend. This fiend represented to Dominguez that he was experienced in debt settlement. Dominguez relied upon this friend s advice i responding to the n complaint and discovery demands made by First American. Thus, while Dominguez s 3 [* 5] friend s advice may have been less than exemplary, it is clear that Dominguez never intended to default in this action. In addition, and as stated more fully below, Dominguez has a meritorious defense to this action. To collect a debt which has been assigned, the assignee has the burden to prove that T it possesses legal standing to bring its lawsuit. See generally V.F Credit, Inc. v. Alexandrescu, 13 Misc. 3d 1207A (Civ. Ct. Queens Co. 2006); Citibank (S.D.), M A . v. Martin, 11 Misc. 3d 219 (Civ. Ct. N.Y. Co. 2005). Here, in an attempt to meet this burden, First American submits, annexed to its attorney affirmation: (1) a signature page of a Bill of Sale, Assignment and Assumption Agreement, dated May 6,2006 between Citibank (South Dakota), N.A. and New Century Financial Services, Inc.( New Century ); (2) a signature page of a Bill of Sale, Assignment and Assumption Agreement, dated June 12,2006, between New Century and First American Receivables Company, LLC ( FARC ); (3) the Bill of Sale by FARC to First American, dated June 25,2005, signed only by FARC; and (4) an untitled, undated document which is identified in First American s attorney affirmation as [a] copy of an extract from a schedule of accounts transferred by and pursuant to the two assignments and the FARC-[First American] bill of sale. None of the documents submitted by First American s attorney are authenticated by a person capable of doing so. Each of the bills of sale refer to annexed agreements which purportedly describe the accounts assigned. However, First American fails to provide those agreements, or any 4 [* 6] other documentation to supportits assertion that Dominguez s account was, in fact, assigned from Citibank to New Century, from New Century to FARC and from FARC to Fist American. For plaintiff to establish standing it must provide a complete chain of assignments from the original creditor to itself. Rub Performance Recoveries, LLC v. Scorsonelli, 2009 N.Y. Misc. LENS 25 12,242 N.Y.L.J. 16 (Rich. Co. Sup. Ct. 2009). Therefore, because First American fails to meet its burden of proving that it possesses legal standing to bring this lawsuit, Dominguez s cross-motion to amend the answer to include the defense of lack of standing, and to dismiss the complaint on that ground is granted. Citibank (S.D.),N.A. v. Martin, 11 Misc. 3d 219 (Civ. Ct. N.Y. Co. 2005). In accordance with the foregoing, it is ORDERED that plaiatiff First American Investment Company, LLC s motion to strike the answer is denied; and it is further ORDERED that defendant Nestor Dominguez s cross-motion for leave to amend his answer is granted; and it is further 5 [* 7] ORDERED that defendant Nestor Dorninguez's cross-motion to dismiss the complaint is granted, the complaint is dismissed, and the Clerk of the Corn is directed to enter judgment accordingly. This constitutes the decision and order of the Court. Dated: New York, New York March a 2 0 12 MAR 2 8 6 -
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