Bazile v Goldstein

[*1] Bazile v Goldstein 2015 NY Slip Op 51753(U) Decided on November 30, 2015 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 November 30, 2015
SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS
PRESENT: : PESCE, P.J., ALIOTTA and ELLIOT, JJ.
2014-1216 K C

Marie T. Bazile, Appellant-Respondent,

against

Lev Goldstein, Respondent-Appellant.

Appeal, on the ground of inadequacy, and cross appeal from a judgment of the Civil Court of the City of New York, Kings County (Noach Dear, J.), entered January 23, 2014. The judgment, after a nonjury trial, awarded plaintiff the principal sum of $5,000.

ORDERED that the judgment is reversed, without costs, and the complaint is dismissed.

In this action, plaintiff seeks to recover the principal sum of $20,000 based on defendant's alleged failure to provide goods that plaintiff had ordered. After a default judgment was entered in the principal sum of $19,099, defendant's unopposed motion to vacate the default judgment was granted. At a nonjury trial, plaintiff testified that, over a period of approximately seven years, she had paid defendant for the purchase of furniture on a layaway plan. Plaintiff made her initial payments to defendant Lev Goldstein at A & A Furniture, Inc., and then to defendant at Gold Furniture, Inc., which was located at the same address where A & A Furniture, Inc. had previously operated. Some payments were made by check and others were made in cash. Plaintiff stated that, at some point, defendant had informed her that the furniture she had originally ordered had become unavailable. Plaintiff chose alternative, more expensive, furniture and made additional payments towards her purchase. After the furniture had been paid for, plaintiff deferred accepting delivery. Plaintiff further testified that there came a time when she had requested that delivery be made to a storage facility, which defendant had refused to do. Plaintiff then agreed to accept delivery of some, but not the majority, of the items of furniture she had purchased. In 2011, plaintiff learned that Gold Furniture, Inc. had gone out of business.

Defendant testified that he had worked as a salesman at A & A Furniture, Inc. and that, when it had gone out of business, he had opened his own furniture store, Gold Furniture, Inc. at the same address. He largely confirmed plaintiff's testimony, that plaintiff had paid substantial sums of money for a number of pieces of furniture, and that she had accepted delivery of only some of the furniture. Defendant further testified, however, that when Gold Furniture, Inc. lost its lease, it had indicated its forthcoming closure in its store window with a "going out of business" sign, and had also attempted to locate all its customers to arrange for the delivery of furniture it was holding. He stated that he had been unable to reach plaintiff by telephone despite numerous attempts, and that plaintiff had failed to respond to any of defendant's telephone messages. At trial, defense counsel moved to dismiss on the ground that defendant had acted only on behalf of corporate entities and had no personal liability.

Following the trial, judgment was entered in favor of plaintiff in the principal sum of $5,000. Plaintiff appeals from this judgment on the ground of inadequacy. In the alternative, she in effect argues that the Civil Court erred in vacating the initial default judgment, which was in the principal sum of $19,099, and seeks reinstatement of that judgment. Defendant cross-appeals on the ground that the $5,000 judgment is not supported by the evidence, and on the additional ground that, since he acted only on behalf of corporate entities, the Civil Court erred in rendering judgment against him in his individual capacity.

While an appeal from a final judgment may bring up for review any non-final judgment or order which necessarily affects the final judgment (see CPLR 5501 [a] [1]), because the order that vacated the original judgment was not, in the first instance, " the subject of contest' " (Katz v Katz, 68 AD2d 536, 541 [1979], quoting James v Powell, 19 NY2d 249, 256 n 3 [1967]; see Anonymous v Nowicki, 125 AD3d 701 [2015]; HSBC Mtge. Corp. [USA] v MacPherson, 89 AD3d 1061 [2011]; Brosnan v Behette, 186 AD2d 165 [1992]; see also CPLR 5511), it is not now subject to review. Consequently, there is no basis to reinstate the original default judgment. We note, in any event, that the Civil Court did not improvidently exercise its discretion in vacating the default judgment (compare Lyubomirsky v Lubov Arulin, PLLC, 125 AD3d 614, 615 [2015]).

Plaintiff's own exhibits, including her checks, established that, over the years, she had paid corporate entities A & A Furniture, Inc. and Gold Furniture, Inc., rather than defendant individually, for the furniture she had sought to purchase. Defendant indicated in his testimony that he had only worked as an employee for A & A Furniture, Inc. and that, while he had worked there, he had received payments from plaintiff only on its behalf. He confirmed that he had owned Gold Furniture, Inc., but indicated that while it was in operation, he had received payments from plaintiff only on its behalf, and not individually. Defendant correctly asserted that he was not liable for the corporate debts of either A & A Furniture, Inc. or Gold Furniture, Inc.

To the extent that plaintiff may have sought to pierce Gold Furniture, Inc.'s corporate veil in order to impose liability on defendant, we note that piercing the corporate veil is an equitable remedy which the Civil Court, as a court of limited jurisdiction, lacks jurisdiction to grant (see 19 W. 45th St. Realty Co. v Doram Elec. Corp., 233 AD2d 184 [1996]; Jack v Restoration Dynamic, Inc., 43 Misc 3d 127[A], 2014 NY Slip Op 50477[U] [App Term, 2d, 11th & 13th Jud Dists 2014]). Furthermore, even following dissolution, corporations continue to exist for the winding up of their affairs, and may continue to sue or be sued (see MMI Trading, Inc. v Nathan H. Kelman, Inc., 120 AD3d 478, 479-480 [2014]). Thus, any claims plaintiff may have had against the corporate entities A & A Furniture, Inc. or Gold Furniture, Inc. should have been in an action against those entities and not against defendant.

We do not consider matters the parties have alluded to in their briefs which are dehors the record (see Chimarios v Duhl, 152 AD2d 508 [1989]; Jerome Ave Condominium, Inc. v Ram, 25 Misc 3d 130[A], 2009 NY Slip Op 52116[U] [App Term, 2d, 11th & 13th Jud Dists 2009]).

Accordingly, the judgment is reversed and the complaint is dismissed.

Pesce, P.J., Aliotta and Elliot, JJ., concur.

Decision Date: November 30, 2015