Jill Ganci Co. v BKG & Co. NY, Inc.

[*1] Jill Ganci Co. v BKG & Co. NY, Inc. 2012 NY Slip Op 50965(U) Decided on May 29, 2012 County Court, Suffolk County Tarantino, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 May 29, 2012
County Court, Suffolk County

Jill Ganci Company, Koastal Konnection and Hal M. Golden & Associates, Plaintiffs

against

BKG & Company NY, Inc., Defendant.



19650/2006



Weinstein, Kaplan & Cohen, P.C.

Attorneys for the Plaintiff

1325 Franklin Avenue, Suite 210

Garden City, New York 11530

John E. Lander, Esq.

484 West Main Street

Babylon, New York, 11702

Andrew G. Tarantino, J.

In this post judgment motion for an order pursuant to NY Civ. Prac. Laws & Rules (CPLR) 305(c) to amend the caption, plaintiffs seek to add EUREKA MFG. INC., and BEST KNIT GROUP CORPORATION as additional Defendants. [*2]

Plaintiffs commenced the underlying action against BKG & COMPANY NY INC. [BKG] by summons and complaint dated June 21, 2006, seeking payment of commissions for the sale and delivery of clothing manufactured by BKG. BKG entered into a stipulation of settlement on November 16, 2009, and a judgment for $41,634.66 less payments made in the amount of $17, 750.00, plus interest and costs for a net total of $38,020.56. BKG failed to make the required payment due on August 15, 2010 and plaintiffs sought to enforce the judgment. When the sheriff attempted to execute the judgment on BKG at its address, the sheriff noticed EUREKA MFG. INC. [EUREKA] was doing business at the address. Its principal, William Gerold, informed the sheriff that EUREKA was now operating at the subject location. The sheriff could not execute the judgment against BKG.

Plaintiffs contend that EUREKA is an "alter ego" of BKG. EUREKA was incorporated December 2009, which post dates the stipulation of settlement. Plaintiffs also pointed out that Kathleen Gerold was chief executive officer of BKG, and that William Gerold III was recorded for process of service for EUREKA. Plaintiffs further argued that BKG is also operating under the entity and trade name of BEST KNIT GROUP CORPORATION. BEST KNIT GROUP CORPORATION was incorporated October 2011. Plaintiffs contend that BKG created these new entities to evade the judgment against BKG. In support of its claims, plaintiffs submitted the New York State Certificates of Incorporation of BKG, EUREKA, and BEST KNIT GROUP CORPORATION. The action was transferred, pursuant to CPLR § 325(d), to this court on June 4, 2009.

CPLR 305(c) states that

[a]t any time, in its discretion and upon such terms as it deems just, the court may allow any summons or proof of service of a summons to be amended, if a substantial right of a party against whom the summons issued is not prejudiced.

However, the rule allowing an amendment to a summons or proof of service to correct a misnomer, can not be invoked to add or substitute a new party defendant (CPLR 305[c]; Smith v. Garo Enterprises, Inc., 60 AD3d 751, 875 NYS2d 167 [2d Dept, 2009].

By virtue of the Certificates of Incorporation, EUREKA, and BEST KNIT GROUP CORPORATION are separate and distinct entities from each other, and from BKG. Here, plaintiffs seek to add these two new entities as named defendants, not merely correct a misnomer of the originally named Defendant. Neither EUREKA nor BEST KNIT GROUP CORPORATION were a party to the underlying action. (See, Ingenito v. Grumman Corp., 192 AD2d 509, 596 NYS2d 83 [2d Dept,1993]). Not having been parties to the underlying settlement, the Court finds that it would be prejudicial to both EUREKA and BEST KNIT GROUP CORPORATION by adding them as parties in this manner, and holding each potentially liable for the terms of that agreement. (See, CPLR 305[c]). Without expressing opinion about the Plaintiffs' arguments, the Court notes that BKG (the named Defendant) did not submit any opposing papers to this application; instead, the only opposition was received from non-party [*3]BEST KNIT GROUP CORPORATION. Because BEST KNIT GROUP CORPORATION did not move pursuant to CPLR 1012, to intervene, the Court did not rely on any of its submissions.

ORDERED that this motion by plaintiffs for an order pursuant to CPLR 305(c) to amend the caption of this action to reflect the corporate names of defendant BKG d/b/a BKG a/k/a EUREKA d/b/a BKG a/k/a BEST KNIT GROUP CORPORATION is denied.

Dated:

ANDREW G. TARANTINO, JR.

J.S.C.