C.V., Inc. v Wnc Tarrytown Co., LLC

[*1] C.V., Inc. v WNC Tarrytown Co., LLC 2004 NY Slip Op 50871(U) Decided on August 2, 2004 Supreme Court, Westchester County 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 This opinion is uncorrected and will not be published in the printed Official Reports.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, 2004
Supreme Court, Westchester County

C.V., INC. Plaintiff,

against

WNC TARRYTOWN COMPANY, LLC, JOHN DOE No.1 Through #10 both inclusive, the names of the last ten Defendants, being fictitious, said defendants true names being unknown, thereby intended to designate parties with liens against the property sought to be partitioned herein and tenants, lessee, or occupants of portions of the premises described in the complaint Defendants.



04-07089



Hiscock & Barclay, LLP, Attorneys for Defendant, WNC Tarrytown Company, LLC, P.O. Box 4878, Syracuse, New York 13221-4878 Attention: Alan R. Peterman. Michael A. Russo, Esq., Attorney for Plaintiff, C.V., Inc., 56 Greenridge Avenue, White Plains, New York 10605.

Mary H. Smith, J.

This is a motion brought by defendant, WNC Tarrytown Company, Inc. (hereinafter referred to as "defendant") pursuant to CPLR § 510(1) for an order transferring this action to the Supreme Court of the State of New York, County of Onondaga. In support of the Notice of Motion, defendant has submitted an Affidavit of Alan R. Peterman, Esq., sworn to June 8, 2004 with attached exhibits A-F and a Memorandum of Law ("Peterman Affidavit I"). Plaintiff responded with an Affirmation in Opposition of Michael A. Russo, Esq. dated July 7, 2004 with attached exhibits 1-4 ("Russo Affirmation I"). Defendant then submitted a second Affidavit of Alan R. Peterman, Esq. in further [*2]Support of the Motion, sworn to June 15, 2004 [FN1] with attached exhibits A-F ("Peterman Affidavit II"), to which plaintiff has submitted a Reply Affirmation of Michael A. Russo, Esq., sworn to July 19, 2004 ("Russo Affirmation II").[FN2] Upon reading of the foregoing papers, the motion is disposed of as follows:

Plaintiff is a New York Corporation with its principal place of business located in the Town of North Castle, Westchester County, New York. Defendant is a New York corporation with its principal place of business located in the Town of Dewitt, Onondago County, New York. Defendant owns real property, upon which plaintiff is seeking to enforce its mechanics lien in the instant action, which is located at 480 White Plains Road, Town of Greenburgh, Westchester County, New York (hereinafter "defendant's property").

This action arises out of defendant's alleged failure to pay plaintiff in full for services plaintiff provided under a construction contract. Based on the complaint's allegations, on April 8, 2003, plaintiff and defendant entered into an agreement whereby plaintiff was to provide roofing services to defendant in connection with its construction of a project known as the Spring Hill Suites, which was to be located on the defendant's property. In April 2004, after plaintiff contends defendant defaulted in paying the remaining $38,170.00 due under the contract price, plaintiff filed a Notice of Lien in writing with the Office of the Clerk of the County of Westchester. This action to enforce the mechanics lien ensued at the beginning of May, 2004. On May 26, 2004, defendant answered the complaint by denying its material allegations and also asserted a counterclaim against plaintiff based on plaintiff's alleged failure to adequately perform its obligations under the contract. Along with its answer, defendant served a Demand for Change of Place of Trial (the "demand") pursuant to CPLR § 511 (a) and (b). In the demand, defendant asserted that the place of the trial should be changed from Westchester County to Onondaga County on the grounds that (1) pursuant to CPLR § 501, the venue is properly in Onondaga County insofar as the contract between the parties fixed Onondaga County as the venue of any action arising out of the contract, and (2) pursuant to CPLR § 503(a), the venue of the action is properly in Onondaga County insofar as it is the County in which defendant resides. (Peterman Affidavit I, Exhibit D).

Plaintiff opposed defendant's demand by serving, on May 27, 2004, an Affidavit of Christopher Verrone, plaintiff's President. In that affidavit, Mr. Verrone, averred that Westchester County is the proper venue for this action because it is "an action to foreclose a mechanic's lien and the real estate is located within the County of Westchester; the work done was performed within the County of Westchester; the material witnesses to the facts and circumstances are located within the County of Westchester; and the defendant does business within the County of Westchester." (Peterman Affidavit I, Exhibit E at ¶ 3). In conclusion, Mr. Verrone averred that "[t]he County of [*3]Onondaga ... is improper because there is no nexus between the County of Onondaga and the instant litigation, and a trial in the County of Onondaga would be contrary to the interests of justice and inconvenient for the material witnesses to the instant matter and is not a county where the subject real estate is located, and there is no such contract provision contained in the subject contract as alleged in defendant's demand.[FN3]" (Id. at ¶ 4).

Thereafter, pursuant to CPLR § 511(b), on June 8, 2004, defendant filed and served its Notice of Motion for a Change of Place of trial. However, because the case had not yet been assigned to a particular judge pursuant to the IAS process, defendant left the return date blank on the motion in accordance with the pre-amendment Uniform Rule 202.8, which had specifically provided that "where a case has not been assigned to a judge, a party may properly serve motion papers without a return date of the name of the assigned judge." (Peterman Affidavit I at ¶ 8).

The delay in the setting of the return date in this matter was occasioned by a number of factors. First, defendant filed its papers with the County Clerk's office via overnight mail rather than personally delivering the papers to the courthouse. Defendant's counsel's letter to the County Clerk, which enclosed the motion papers and the RJI, was very detailed in the instructions that were provided concerning the filing of the motion. Thus, the cover letter specifically requested that Westchester County Clerk process the fees for filing the motion and RJI and forward the motion papers and return envelope to the Supreme Court Clerk. The letter further stated that "[b]y copy of this letter I am requesting the Supreme Court Clerk return a date stamped copy of the motion papers to me in the self-addressed stamped return envelope provided herein." (Letter of Alan R. Peterman, Esq. of Hiscock & Barclay LLP dated June 8, 2004). While it is common practice to mail-in motions, as a result of this procedure in this case, there was a 6 day delay in the transfer of the motion papers and RJI from the County Clerk's office to the office of the Chief Clerk of Westchester County's Supreme and County Courts. Accordingly, this motion was not assigned to this Court until June 14, 2004, at which time my part clerk, Selene Jackson, filled in the blank return date with June 29, 2004, but then failed to forward the papers back to defendant's counsel as defendant's counsel had instructed in his letter of June 8, 2004. Indeed, it was not until June 22, 2004 that Ms. Jackson returned to defendant's counsel the filled-in motion papers.

Having not yet received the papers that had been posted on June 22, 2004, on June 23, 2004, defendant's counsel wrote to Ms. Jackson (with a carbon copy going to plaintiff's counsel) confirming a conversation wherein it was agreed that because he had not yet received a date stamped copy of the motion with the assigned motion return date of June 29, 2004, which he could then serve on opposing counsel, the motion date was being re-scheduled from June 29, 2004 to July 13, 2004 to give plaintiff sufficient time to put in its opposition.

Plaintiff's counsel, however, weighed in with his opinion concerning the validity of the motion in a letter dated June 24, 2004, wherein plaintiff's counsel advised the Court that plaintiff was deeming the motion defective because the lack of the return date "constitutes insufficient notice and that the motion should not be heard since there is no meaningful opportunity to respond." (See Letter dated June 24, 2004, Russo Affirmation I, Exhibit 2). Plaintiff's counsel nevertheless [*4]conceded that the instant motion had been mailed to plaintiff on June 8, 2004. On June 25, 2004, defendant's counsel mailed to plaintiff's counsel via overnight delivery another copy of the instant motion, which now had a return date of July 13, 2004.

Plaintiff's primary opposition to the instant motion revolves around its argument that the motion is untimely pursuant to CPLR § 511(b) because of defendant's failure to include a return date on the original motion papers. Thus, it is plaintiff' s position that this Court should ignore the original service date of this motion (i.e., June 8, 2004) and find that the later service on plaintiff on June 25, 2004 controls the timeliness of the instant motion. Since that date is more than 15 days after the defendant served his demand to change venue, this motion must be dismissed as untimely pursuant to CPLR § 511(b).

Given the above-described events, the Court cannot ascribe to plaintiff's argument that the motion was untimely under CPLR § 511(b). Plaintiff concedes that the original motion papers were served on it by mail on June 8, 2004, well within the required 15 days after the demand, which was served on May 27, 2004. The fact that the motion did not contain a return date does not render the motion fatally defective.[FN4] Here, plaintiff was served with Notice of the Motion and the underlying [*5]papers within the 15 day time period. The fact that plaintiff was later advised of the July 13, 2004 return date, through the service of another copy of the motion papers on it on June 25, 2004, does not negate the timeliness of this motion. Thus, at best it was a procedural irregularity that may be disregarded by this Court. (Matter of the Estate of Venner, 235 AD2d 805). Finally, even if this Court were to find that defendant's motion was untimely, it would be an appropriate exercise of discretion for this Court to order the transfer to Onondaga County based on the contractually agreed-to venue provision. (See Callanan Indus., Inc. v. Sovereign Constr. Co., Ltd., 44 AD2d 292; Pittman v. Maher, 202 AD2d 172).

With regard to the substantive aspects of this motion, plaintiff has not refuted that the language of the contract specifically provides that "[t]he place of any action between [defendant] and the Contract[or] relating to the subject matter of this Contract shall be Onondaga County, New York." (See Peterman Affidavit I, Exhibit F at ¶ 31). Accordingly, it is undisputed that the parties contractually stipulated that any action regarding the contract would take place in Onondaga County, New York. Despite this agreed-upon forum selection clause, plaintiff argues that because "the instant action is to foreclose in a Mechanics Lien ... [p]ursuant to the provisions of CPLR §507, as a matter of law plaintiff was required to bring the instant action in the County of Westchester as the real property is located therein .... Under such circumstances, the convenience of witnesses may properly override contract provisions." (Russo Affirmation I at ¶ 13 citing Gardner & North Roofing & Siding Corp. V. Deaton, 1 Misc2d 90, aff'd, 286 AD 992). [*6]

CPLR § 501 governs a court's enforcement of a forum selection clause.[FN5] That statute provides that "[s]ubject to the provisions of subdivision two of section 510, written agreement fixing place of trial, made before an action is commenced, shall be enforced upon a motion for change of place of trial." (CPLR § 501). Thus, based on the statute's language, the only exception to a court's enforcement of a forum selection clause is CPLR § 510(2), which permits a change of venue when "there is reason to believe that an impartial trial cannot be had in the proper county." (CPLR § 510(2)). However, in its opposition to the instant motion, plaintiff does not argue that it believes that an impartial trial cannot be had in Onondaga County. Nor has plaintiff raised any claims of fraud or overreaching in connection with the parties' negotiations of this venue provision.

Indeed, other than its timeliness argument, the only substantive argument plaintiff raises is that CPLR § 507 controls where this action must be tried (i.e., in the county in which the property is located). However, because CPLR § 501 does not exempt actions involving mechanic lien foreclosures from its clear mandate that a court should honor such venue provisions except in actions where the selected venue could not provide a fair trial, this Court holds that CPLR § 507 does not control where this action may be brought. Instead, this Court agrees with the conclusion set forth by another court confronted with this exact issue i.e., that CPLR § 501 trumps the requirements found in CPLR § 507. (See, e.g., A.C.E. Elevator Co., v. V.J.B. Constr. Corp., 192 Misc2d 258). As the court in A.C.E. Elevator Co. noted: "First, pursuant to the express terms of CPLR 501, a contractual forum selection clause is enforceable except in a situation governed by CPLR 510(2), which is not relevant here. Hence, applying the interpretive canon of inclusio unius est exclusio alterius, the Legislature's failure to exempt CPLR 507 from the grasp of CPLR 501 necessarily demonstrates that the statutory scheme does not preclude parties from contractually fixing venue in a foreclosure action. Stated otherwise, had the Legislature intended that a written agreement fixing venue could not be enforced in an action affecting real property, it would have necessarily included a reference to CPLR 507 within the body of CPLR 501 as it did with section 510(2) ....

Second, while CPLR 507 does speak in mandatory terms, i.e., it provides that an action affecting real property "shall" be commenced in the country where the property is situated, this is of little significance in determining the interrelationship between CPLR 507 and 501. In this vein, CPLR 503(a), the statute governing transitory causes of action, similarly speaks [*7]in mandatory language, providing that the trial of such an action "shall be in the county in which one of the parties resided when it was commenced (Emphasis added.)" It is settled law, however, that this mandatory language is trumped by a written agreement fixing venue as authorized by CPLR 501 (see, Callanan Indus., Inc. v. Sovereign Constr. Co., 44 AD2d 292; see also, Brooke Group v. JCH Syndicate 488, 87 NY2d 530; Premium Risk Group, Inc., v. Legion Ins. Co., 294 AD2d 345; Buhler v. French Woods Festival of the Performing Arts, 154 AD2d 303). By a parity of reasoning, therefore, it is apparent that CPLR 507 does not, because of its use of mandatory language, conflict with the provisions of CPLR 501."

(A.C.E. Elevator Co., 192 Misc2d at 260). The court in A.C.E. Elevator further concluded that the enforcement of the forum selection clause would not deprive the plaintiff of the rights it had under the Lien Law finding that "a foreclosing lienor may comply with the forum selection clause of its contract while simultaneously complying with the procedural prerequisites to enforcement of its lien." (A.C.E. Elevator Co., 192 Misc2d at 262).

Finally, to the extent plaintiff is arguing that the convenience of the parties should outweigh the venue provision, this Court does not agree with plaintiff's argument. Given that the defendant resides in Onondaga County, it would appear that it is mainly plaintiff's witnesses that would be inconvenienced not defendant's witnesses. Moreover, plaintiff has failed to provide in its opposition the names and addresses of its prospective witnesses and a statement of facts concerning the nature of each witness's testimony. As such, plaintiff's argument concerning the convenience of the witnesses does not rise to the level necessary for this Court to exercise its discretion and override the parties' contractually-selected venue. (See, e.g., Kenron Awning and Window Corp. of Eastern New York v. Abbott, 43 Misc2d 552 ["[t]he fact that defendants propose to call seven witnesses, all residents of Oneida County, is not a sufficient excuse for overriding the agreement of the parties when the plaintiff's place of business is Onondaga County and it clearly was within its rights to lay venue there"]; Grey v. Colonial Home Improvement Co., 57 Misc2d 321). Finally, the Court finds that there would be no violation of public policy in enforcing this forum selection clause. A public policy violation has been interpreted as including a situation in which the selected venue is neither the site of the subject matter of the action nor the residence of either of the parties. (Syracuse Plaster Co. v. Agostino Bros. Bldg. Corp., 169 Misc 564). In this case, Onondaga County is defendant's county of residence, so there is no public policy violation through this Court's transfer of the action to Onondaga County.

Based on the foregoing, it is hereby

ORDERED, that the place of the trial of this action is transferred from Westchester County to Onondaga County; and it is hereby

ORDERED, that defendant's counsel shall arrange for the transmittal of the file in this action to the Supreme Court of the State of New York, County of Onondaga.

This constitutes the Decision and Order of the Court.

Dated: White Plains, New York

August 2, 2004 Honorable Mary H. Smith, J.S.C. Footnotes

Footnote 1:While the date appearing on the Affidavit is June 15, 2004, given that Defendant's opposition was not provided until July 7, 2004, and given that the cover letter to this Affidavit is dated July 15, 2004, the Court believes that the June 15, 2004 date was a typo and the correct date for this Affidavit is actually July 15, 2004.

Footnote 2:This Reply Affirmation is actually a sur-reply. As such, plaintiff should have requested leave of this Court to submit the sur-reply, but the Court has nevertheless considered the Reply Affirmation in its consideration of the instant motion.

Footnote 3:It appears that based on its opposition to the instant motion, plaintiff has dropped this last argument and now concedes that the parties agreed that an action arising under the contract would be heard in Onondaga County.

Footnote 4:See, e.g., Bush v. Hayward, 156 AD2d 899, app. denied, 75 NY2d 709 (Supreme Court did not lack jurisdiction on a motion to dismiss because the original motion did not include a return date as required by CPLR 2214(a)); Matter of Estate of Venner, 235 AD2d 805, 806 ("Initially, we reject petitioner's argument that Surrogate's Court was without jurisdiction to determine respondent's motion for summary judgment because the notice of motion contained no return date. The record indicates that petitioners received a letter informing them of the return date within a week after they had received respondent's motion papers. We find, since no substantial right of a party was prejudiced, that Surrogate's Court properly disregarded the procedural irregularity ...."). Plaintiff argues that the decision in Bush is not dispositive because the holding in that case was dependent upon language found in Uniform Court Rule 202.8, which has since been amended to take out the language which specifically provided that motions could be filed without return dates when a case had not yet been assigned to a judge. This Court disagrees with plaintiff's strained interpretation. To begin with, the amended rule now states that the motion "shall be made returnable before the court, and a copy of the moving papers, together with a request for judicial intervention, shall be filed with the court, with proof of service upon all other parties, where required by section 202.6 of this Part, within five days of the service upon the other parties. The moving party shall give written notice of the index number to all other parties immediately after filing of the papers .... The case shall be assigned to a judge as soon as practicable after the filing of the request for judicial intervention .... After assignment to the judge, the court shall provide for appropriate notice to the parties of the name of the assigned judge." (Uniform Rule § 202.8). Thus, the amended rule does not state that a return date must be set forth in the motion papers. And while it is common practice to include a meaningless return date (since it is unlikely that the selected return date will coincide with the assigned judge's calendar day), there is no language in the rule suggesting the selection of such a return date is mandatory to the viability of the motion. Furthermore, the language found in Uniform Rule § 202.8 was only one factor considered and the primary consideration by the court was that adequate notice (which is the purpose behind the selection of an appropriate return date) had been provided so that the party had time to put in its opposition to the motion. In Bush, plaintiff had been served with the motion papers by mail on October 19, defendant then filed papers in compliance with the regulation and plaintiff was than notified as early as November 3 that the return date would be November 18. Given the 29 days notice of the motion, the court found that "[s]ince the requisite notice of the motion was given, Supreme Court had jurisdiction to entertain the motion." (Bush, 156 AD2d at 900). Here, as in Bush, plaintiff was notified on June 8 that a motion was being made and by June 25, 2004, plaintiff had been advised that the return date had been set for July 13, 2004, well within the notice requirements of CPLR §§ 2214 and 2103(b)(3). Finally, none of the cases upon which plaintiff relies involved a scenario similar to the one present in this case and instead involved other types of proceedings, such as special proceedings, where the caselaw is clear that the failure to include a return date renders the proceeding jurisdictionally defective. (See Matter of Civil Service Employees Assn., Inc. v. Albrecht, 180 AD2d 183, app. denied, 80 NY2d 761; Consolidated Edison Co. Of New York v. Church of St. Cecilia, 125 Misc2d 744). Plaintiff's reliance on European American Bank v. Legum, 248 AD2d 206 is similarly misplaced. That case involved a turnover proceeding alleging fraudulent transfers and there was an Order to Show Cause signed in that case on May 27, 1997, which set a return date for June 2, 1992 and which required service on the respondent by May 28, 1997. However, the Order to Show Cause, which was served on the respondent, lacked the return date that had been inserted by the court. Therefore, in that case, the court found the defect jurisdictional since "'[t]he mode of service provided for in [an] order to show cause is jurisdictional in nature and must be literally followed.'" (European American Bank, 248 AD2d at 208; quoting Goldmark v. Keystone & Grading Corp., 226 AD2d 143, 144; Bell v. State Univ., 185 AD2d 925; Laino v. Cuprum S.A. de C.V., 235 AD2d 25).

Footnote 5:In addition to CPLR § 501, a party could challenge a forum selection clause by showing that the "enforcement would be unreasonable and unjust or that the clause is invalid because of fraud or overreaching, such that a trial in the contractual forum would be so gravely difficult and inconvenient that the challenging party would, for all practical purposes, be deprived of his or her day in court." (British West Indies Guaranty Trust Co., Ltd. V. Banque Internationale A Luxembourg, 172 AD2d 234; see also Bell Constructors, Inc. v. Evergreen Caissons, Inc., 236 AD2d 859). Here, as in the British West Indies case, plaintiff has not alleged fraud or overreaching with respect to the venue selection provision and as a signatory to the contract, plaintiff is "presumed to know the contents of the instrument ... [it] signed and to have assented to such terms." (British West Indies Guaranty Trust Co., 172 AD2d at 234).