Txcollect, Inc. v Muszynski

[*1] Txcollect, Inc. v Muszynski 2010 NY Slip Op 51445(U) [28 Misc 3d 136(A)] Decided on August 2, 2010 Appellate Term, Second Department 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 August 2, 2010
SUPREME COURT OF THE STATE OF NEW YORK
APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS
PRESENT: : TANENBAUM, J.P., MOLIA and IANNACCI, JJ
2009-1579 S C.

Txcollect, Inc. assignee in interest to CHASE MANHATTAN BANK, Respondent,

against

Czeslaw Muszynski, Appellant.

Appeal from an order of the District Court of Suffolk County, Third District

(C. Stephen Hackeling, J.), entered April 14, 2009. The order denied defendant's motion to vacate a default judgment.

ORDERED that the order is reversed without costs and defendant's motion to vacate the default judgment is granted.

Plaintiff, the assignee of Chase Manhattan Bank (Chase) under Chase's agreement to extend a revolving line of credit to defendant, commenced this action to recover the principal sum of $7,914.75 and accrued interest at the contractual rate of nine percent, alleging causes of action for breach of contract and based on an account stated. Defendant was served with a summons with notice and a verified complaint.
Defendant appeared and, in effect, acknowledged a debt but denied owing the amount claimed.

The action was stricken from the calendar after plaintiff defaulted at a calendar conference. Plaintiff's motion to restore the action to the calendar was granted by order entered October 12, 2005. Although defendant was served by mail with a copy of the order, there is no evidence in the record that defendant was ever advised of the trial date. He failed to appear at the January 26, 2006 trial, and, on June 1, 2006, judgment was entered against him in the principal amount of $7,914.75, together with interest from March 13, 2002.

On October 31, 2008, after his bank account had been attached, defendant, representing himself, moved by order to show cause to vacate the judgment and to set the matter down for trial, asserting that he had failed to appear at trial because he had been unaware of the trial date. By order entered April 14, 2009, the District Court denied defendant's motion.

Courts possess the inherent power to vacate a default judgment in the interest of justice (see Woodson v Mendon Leasing Corp., 100 NY2d 62, 68 [2003]; Ladd v Stevenson, 112 NY 325, 332 [1889]). Here, from the outset, while acknowledging a debt to plaintiff, defendant contested the amount owed. Moreover, the record shows that, having previously appeared, defendant defaulted at trial due to a lack of notice; in opposition to defendant's motion, plaintiff [*2]never came forth with any evidence that defendant had actual notice of the trial date. In these circumstances, we conclude that the District Court improvidently exercised its discretion in denying defendant's motion to vacate the default judgment.

Accordingly, the order denying defendant's motion to vacate the default judgment is reversed, defendant's motion is granted, and the case is remitted to the District Court for a trial.

Tanenbaum, J.P., Molia and Iannacci, JJ., concur.
Decision Date: August 02, 2010