Suifehne Yongtai Economic & Trade Co., Ltd. v Unicos Enters., Inc.

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Suifehne Yongtai Economic & Trade Co., Ltd. v Unicos Enters., Inc. 2012 NY Slip Op 32133(U) February 21, 2012 Supreme Court, New York County Docket Number: 600677/2010 Judge: Lucy Billings 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. .. .. 'T SCANNED ON 811312012 [* 1] SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY Justice MOTION CAL. NO. The followlng papers, numbered 1 t o 10 Notice of Motion/ Order to Show Cause were read on this motion $&for 4 &f%dfH w - Affldavits - Exhiblts ... 1-7 Answering Affidavits - Exhibits Replying Affidavits . 0 Yes Cross-Motion: . No Upon the foregoing papers, it is ordered that M m n e h w : NEW YORK C O W m CLERK'S OFFICE Dated: GA-7 121 11% LUCY BI LLINGS 5 J. S. C. J.S.C. 0 FINAL DISPOSITION Check if appropriate: 0 DONOTPOST Check one: I NON-FINAL DISPOSITION [* 2] SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: PART 46 X - - - - - _ _ _ - _ - - - - - - - - - _ l _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ l SUIFEHNE YONGTAI ECONOMIC AND TRADE CO., L T D . , Index No. 6 0 0 6 7 7 / 2 0 1 0 Plaintiff - against - DECISTQN AND ORDER UNICOS ENTERPRISE, INC., PHANNY SILK GROUP , HUN C . PARK, and FRANKIE HEDVAT, DefendantB Plaintiff's witness in the People's Republic of China does not attest that he observed defendants or their representatives sign t h e Consignment Agreement or guarantees plaintiff seeks to enforce or t h a t he is familiar with the signatures. Matter of Press, 3 0 A.D.3d 154, 156-57 (1st Dep't 2006); Acevedo v , Audubon Mqt., 280 A.D.2d 91, 95 (1st Dep't 2001); Feop le v. Brvant, 12 A.D.3d 1 0 7 7 , 1 0 7 9 (4th Dep't 2004). Pevton v. State of Newburqh, 14 A.D.3d 51, 53-54 (1st Dep't 2004). Nor does plaintiff present any circumstantial evidence authenticating defendants' signatures, such as personal knowledge of the transmission to defendants of an unsigned contract and their return of a signed contract. P e o p L ~v. Pierre, 41 A.D.3d 2 8 9 , 291 (1st Dep't 2007); People v. Bryant, 12 A.D.3d at 1 0 7 9 ; People v. Thomas, 272 A.D.2d 892, 8 9 3 (4th Dep't 2000); People v. Jean- Louis, 272 A.D.2d 626, 6 2 7 (2d Dep't 2000). Therefore the court suifchne.136 1 [* 3] denies plaintiff s motion for a default judgment against defendants. C.P.L.R. 5 3215(f); Utak v. Commerce Bank, 522, 523 (1st Dep t 2011); yanhattan Telecom. Corp. v. H ,- 8 8 A.D.3d & A 82 A.D.3d 674 (1st Dep t 2011); Mejia-Ortiz v. Inoa, 71 A.D.3d 517 (1st Dep t 2010); B e l t r e v. Babu, 32 A.D.3d 722, 723 (let Dep t 2006)- See Wilso n v. Galicia Contr. & Reatoration C o r p . , 10 N.Y.3d 827, 830 (2008); - o s n v. Mendon Leasinq Corp., 100 N.Y.2d 62, 70-71 (2003); Al Fayed v. Barak, 39 A.D.3d 371, 372 (1st Dep t 2007). 11. DEFENDANT HEDVAT S EXCUSE FOR DEFAULTING In opposing plaintiff s motion for a default judgment, defendant Hedvat explains the reason for his default in answering. He consulted an attorney regarding plaintiff s claims against him and believed that she was handling his defense. When, upon his receipt of plaintiff s motion, he realized he no longer was being represented, he promptly retained another attorney, who promptly responded to the motion. Defendant Hedvat s misplaced reliance on his former attorney t h u s furnishes a reasonable excuse for his failure to answer. Cirillo v. Macy H, J n c . , 61 A.D.3d 538, 540 (1st Dep t 2009); JoneB v. 414 Equities LLC, 57 A.D.3d 65, 81 (1Bt Dep t 2008); Qbe rmaier v. Fix, 25 A.D.3d 327 (1st Dep t 2006); Wilson v. Sherman Terrace Coop., Inc., 14 A.D.3d 367 (1st Dep t 2005). See pou ssodimou v. Zafiriadis, 238 A.D.2d 568, 569 (2d Dep t 1997). suifehne.136 2 [* 4] 111. EXTENlJI;NJG DEFENDANT HEDVAT'S TIME TO ANSWER A. Applicable Standards Although defendant Hedvat does not expressly move to extend his time to answer, C . P . L . R . 5 3012(d), h i s opposition to plaintiff's motion does request that the court vacate his default Particularly in the context of a motion for a in answering. default judgment, the court may extend the time to answer absent a cross-motion f o r that relief. h, 287 a; Hissins v. B e l let Constr. A.D.2d 377 (1st Dep't 2001); Vines v. Manhatt an & Bronx Surface Tr. Operati'nq Auth. , 162 A.D.2d 229 (1st Dep't 1990) ; Willie v. C i t y of N e w York, 154 A.D.2d 289, 290 (1st Dep't 1989); $hurt? v. Villaqe of WesthanmtQn Beach,,121 A.D.2d 887, 888 (1st Dep't 1986). See Spira v, N ew York city Tr. Auth., 49 A.D.3d 478 , 265 A.D.2d 399, 401 (2d Dep't (1st Dep't 2008); 1999). C.P.L.R. § 3012(d) allows a late answer upon a 'Ireasonable excuse for delay or default" and Ilsuch terms as may be j u s t . " Although the latter provision may include a showing of a meritorious defense, § 3012(d) does not specifically require a meritorious defense a g a i n s t plaintiff's claims, and such a showing is unnecessary to support acceptance of a late answer. Verizon N.Y. Tnc, v. rase C o m t r , Co, Inc., 63 A.D.3d 521 (1st Dep't 2009); Cirillo v. Macv'n, I n c , , 61 A.D.3d at 540; J ~ n e s V. 414 Ewities L L C , 57 A.D.3d at 81; Spira v. New York Citv Tr. Auth., 49 A.D.3d 478. suifchne.136 3 [* 5] B. Allnwinq Defendant: Hedvat's Late Answer Defendant Hedvat' Y explarlaLion f o r f a i l i l l y to answer timely, absent any discernible prejudice to plaintiff, satisfactorily excuses his late answer. Gazes v. Bennett , 70 A.D.3d 579 (1st Dep't 2010); Verizon N.Y. Ipc. v . Cas e Constr. Co. Inc., 63 A . D . 3 d 521; Cirillo v. MacY'R, Inc., 61 A.D.3d at 540; Jones v. 414 Emities LLC, 57 A.D.3d at 81. In opposing a default judgment, Hedvat also presenta several defenses. First, plaintiff, a foreign corporation, is unauthorized to conduct business in New York, but is conducting business in New York, and therefore may not maintain this action until authorized. N.Y. Bus. Corp. Law 5 1312(a). E.q., Barklee Realty C o , v. Pataki, 309 A.D.2d 310, 315-16 (1st Dep't 2003); Hishfill, & Inc. v. Bruce Iris, Iqc,, 50 A.D.3d 742, 744 (2d Dep't 2008). Second, Hedvat had no financial interest in defendant Phanny S i l k Group or defendant Unicos Enterprise, Inc., against which plaintiff agreed to forbear commencing an action upon a letter of credit and b i l l of lading, in exchange f o r personal guarantees of defendant entities' obligations as conEtignees under a Consignment Agreement with plaintiff consignor. Therefore he received no consideration for signing what plaintiff claims is his personal guarantee of Phanny Silk's obligations under that agreement. ParkchePter S. Condominium I n c . v. Hernandez, 71 A.D.3d 503, 504 (1st Dep't 2010); American Exprees Bank v. $Dire P u e r t o Rico, 2 2 6 A.D.2d 158, 159 (1st Dep't 1996). See Bronx Store Ecru ip. Co,, Inc. v, Westbury Brooklyn suifehne.136 as so^., 4 L.P., 16 A.D.3d 119, 120 (1st [* 6] Dep't 2005); PC Ware I n t l . v. Jinrna Computer C o . , 299 A.D.2d 271, 272 (1st Dep't 2002); ptlantic Bank of N.Y. v. Bertolini Indus., 183 A.D.2d 591, 5 9 2 (1st Dep't 1 9 9 2 ) . He had neither any purpose in guaranteeing repayment to induce plaintiff's forbearance against Phanny Silk, gee Caruso v. Northeast Emersencv Med. Assoc,, P.C., 54 A.D.3d 524, 5 2 6 - 2 7 (3d Dep't 2 0 0 8 ) , nor the requisite intent to be bound to plaintiff "aa creditor to pay a debt contracted by a third party," here Phanny S i l k , "either immediately upon default of the third party or a f t e r attempts to effect collection from the third party have failed." Chemical Bank v. Meltzer, 93 N.Y.2d 2 9 6 , 3 0 2 - 3 0 3 ( 1 9 9 9 ) . Based on Ifthe respective roles of the parties and the nature of the underlying transaction," at 3 0 3 , the transaction " a s an integrated whole,11 & at 304, and the context of any such guarantee, Hedvat maintains he did not take on t h e status of a personal guarantor. Beal Sav. Bank v. $emmer, 8 N.Y.3d 318, 324 (2007); Bronx Store Emip. Co., I n c . v . Weatburv Brooklvn Aseoc., L , P . , 16 A.D.3d at 120; 150 Broadway Asagc. N,Y. A ~ m c . , L.P. v. BQdner, 14 A.D.3d 1, 7 (1st Dep't 2004); C a r u m v. Northeast Emerqencv Med. Pa SOC., I P C . 54 A.D.3d at 527. Third, Hedvat signed the consignment Agreement at the end, on page 8, which included a Personal Guarantee provision, "on behalf of PHANNY SILK GROUP." Aff. in Supp. of Default J. of Chun Ji J i n Ex. A , at 8. Page 9, which shows Hedvat' B signature Itasindividua1,Il contains no text. I .at d 9. Thus, consistent with Hedvat's l a c k of intent to be bound as the guarantor of suifehne.136 5 [* 7] Phanny Silk's contracted debt to plaintiff upon Phanny Silk's default, articulated above, his signature iB not identified a8 connected to any personal guarantee. Absent any text, the Bignature page that includes the provision "as individualll does not plainly and unambiguously relate to a promise that Hedvat individually will pay Phanny Silk's debt under t h e Conaignment Agreement. On the aignature page that does express a promise to pay Phanny Silk's debt, Hedvat signed only "on behalf of PHANNY SILK GROUP." If explicit terms that he promised to pay its debt are lacking, the ambiguity raises a serious question regarding the guarantee's enforceability against him. Mathiaa VI & Carr, Inc. M nqini, 13 A.D.3d 148 (1st Dep't 2004); &,owinqer v. LQwinqer, a 2 8 7 A.D.2d 3 9 , 45 (let Dep't 2 0 0 1 ) ; Jan Woodner Family Collection v , Abaris B o o b , 284 A.D.2d 163, 164 (1st Dep't 2001); Sound p i s t r i b . Corp, v , Richmond, 213 A.D.2d 178, 179 (1st Dep't 1995). Finally, plaintiff does not articulate how defendant Hedvat's delay in answering has caused plaintiff to change its position to its prejudice. m, Da imlerchrvaler 1s. Co. v. $eck, 8 2 A.D.3d 581, 5 8 2 (1st Dep't 2011). Absent discernible prejudice from Hedvat's delay, A; put;, Mar. Off., Inc, v. Joy Conatr. C o r p . , 39 A.D.3d 417, 419 (1st Dep't 2 0 0 7 ) ; Heskel'a W , 38th St. Corp. v. Gotham Constr, Co. L J l r, 14 A.D.3d 306, 307-308 (1st Dep't 2005); Forastieri v . Hasaet, 167 A.D.2d 125, 126 (1st Dep't 19901, his excuse for his delay and his articulated defenses provide just terms on which to allow his answer, as long as he serves it promptly. suifehne.136 C.P.L.R. 5 3012(d); Forastieri v. 6 [* 8] 171 A.D.2d 426, 427 (1st Dep t 1991). IV. CONCLUSION T h e deficiencies in admissible evidence supporting plaintiff s claim constitute grounds to deny its motion for a default judgment against all defendants. Defendant Hedvat s excuse f o r failing to respond to the complaint until after he received plaintiff s motion also constitutes grounds to deny a default judgment against h i m , as well as to allow his late anewer. Spira v. New York City Tr. Auth., 4 9 A.D.3d 4 7 8 ; Guzetti v. City of New York, 32 A.D.3d 234 (1st Dep t 2 0 0 6 ) ; Rdriquez v . pixie N.Y.C., Ipc . , 26 A.D.3d 199, 2 0 0 (1st Dep t 2 0 0 6 ) ; Terronea v. Morera, 295 A.D.2d 254, 255 (1st Dep t 2003). S g g Mavereop 30 Stutman, LLP v. M O E I ~ , A.D.3d 2 6 1 (1st Dep t 2 0 0 6 ) ; Tullev v. StrauB, 265 A.D.2d at 401. Therefore the court denies plaintiff s motion for a default judgment and, on the grounds set forth above, extende defendant Hedvat s time to serve and file an C.P.L.R. answer to 2 0 days after entry of this order. 3012(d), 3215(f). DATED: T h i s decision constitutes the court's order. February 21, 2012 - L 9 -< q FILED LUCY BILLINGS, J.S.C. I suifehne.l36 §§ 7 ,

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