Creditone, LLC v Feldman

[*1] Creditone, LLC v Feldman 2012 NY Slip Op 50136(U) Decided on January 10, 2012 Supreme Court, New York County Ling-Cohan, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 January 10, 2012
Supreme Court, New York County

Creditone, LLC, Plaintiff,

against

Fang Mei Feldman, Defendant.



107031/10



Plaintiff:

Rattner & Associates, P.C.

2 Perlman Dr., Ste 310

Spring Valley, NY 10977

845-512-8700

Pro Se Defendant:

Fang Mei Feldman

Doris Ling-Cohan, J.

The following papers, numbered 1-7 were considered on this motion for summary judgment and cross motion to dismiss:

PAPERSNUMBERED

Notice of Motion/Order to Show Cause, — Affidavits — Exhibits1, 2,

Answering Affidavits — Exhibits ________________________________6

Replying Affidavits(memo)7

Cross-Motion:[ X ] Yes[ ] No3, 4, 5

Upon the foregoing papers, it is ordered that this motion and cross motion are decided as indicated below.

Plaintiff Creditone, LLC commenced this action against defendant Fang Mei Feldman to [*2]recover an alleged credit card debt. Plaintiff now moves for summary judgment pursuant to CPLR 3212. Defendant cross-moves to dismiss plaintiff's complaint in its entirety, denying plaintiff's motion for summary judgment, and for attorneys' fees and costs. Defendant contests proper service of the Summons and Complaint and is seeking dismissal based on lack of personal jurisdiction.

BACKGROUND

Defendant, as President of Ancient & Classic, Inc. (Ancient & Classic), applied for a Business Credit Card (the Card), over the phone, for Ancient & Classic with Bank One Corporation (Bank One) in November 2003. Defendant alleges that the Card was used by her for Ancient & Classic's business, from 2003 to 2005. Ancient & Classic was dissolved in 2008.

Plaintiff alleges that its predecessor in interest, Chase Bank USA, NA (Chase Bank), issued the Card to defendant and Ancient & Classic. Defendant's account with Chase Bank was subsequently assigned to plaintiff. According to plaintiff, based on the terms of the agreement for the use of the Card (the Agreement), defendant is personally liable for the outstanding amount due on the Card, whether it was used by herself or Ancient & Classic.

Plaintiff commenced this action by summons and complaint, served by "nail and mail" service, pursuant to CPLR 308 (4). In seeking dismissal, defendant alleges that she only received the summons and complaint by mail and that she did not receive a copy affixed to her door.

DISCUSSION

Defendant's Cross-Motion to Dismiss

As a threshold matter, this court must determine whether it has personal jurisdiction over defendant. Plaintiff has submitted an affidavit of service by the process server, for the summons and complaint, and an attorney's affirmation. Plaintiff opposes defendant's cross-motion by arguing that the affidavit of service shows defendant was served and that defendant timely interposed an Answer, which indicates that she was properly served. In seeking dismissal, defendant submits an affidavit in which she states that she never found the summons and complaint allegedly affixed to her door, but merely received a copy by mail.

However, CPLR 3211(e) states that "an objection that the summons and complaint...was not properly served is waived if, having raised such an objection in a pleading, the objecting party does not move for judgment on that ground within sixty days after serving the pleading". Defendant's cross-motion to dismiss is based on lack of personal jurisdiction due to plaintiff's alleged failure to properly serve the summons and complaint. Defendant properly preserved her personal jurisdiction defense in her Verified Answer dated and served on August 17, 2010. Accordingly, defendant had sixty days from August 17, 2010 to move for dismissal for lack of personal jurisdiction based on plaintiff's alleged improper service. Defendant's current cross-motion to dismiss was not made until November 8, 2010, over sixty days from August 17, 2010. Thus, defendant's defense of lack of personal jurisdiction is waived, pursuant to CPLR 3211(e), and defendant's cross-motion to dismiss is denied.

Plaintiff's Motion for Summary Judgment

Plaintiff argues that it is entitled to summary judgment as a matter of law and that no triable issues of fact exist. Specifically, plaintiff argues that defendant applied for the Card for Ancient & Classic, received the Card from Chase Bank, utilized the Card pursuant to the Agreement, made partial payments to Chase Bank, and failed to pay the remaining balance of [*3]$18,203.13 due on the Card, totaling $26,380.13, together with interest through May 6, 2010. In support of its motion, plaintiff proffers copies of assignments and affidavits of sale of defendant's account from Chase Bank to plaintiff, the Agreement, and credit card statements for the Card in plaintiff's own name and in the name of Ancient & Classic. Plaintiff contends that, pursuant to the Agreement, defendant's use of the Card constituted an acceptance of the express terms set forth in the Agreement. Page 1 of the Agreement states, in pertinent part, that:

You promise to pay us for all transactions made on your account, as well as any fees or finance charges. Each person who is included within the definition of you' below, is responsible, together and individually, for paying all amounts owed. ... You will be bound by this agreement if you or anyone authorized by you use your account for any purpose, even if you don't sign your card. Whether you use your account or not, you will be bound by this agreement unless you cancel your account within 30 days after receiving your card and you have not used your account for any purpose. ... The words you', your' and yours' mean all persons responsible for complying with this agreement, including the person who applied for the account and the person to whom we address billing statements...

[Plaintiff's Notice of Motion, Exh. E, emphasis supplied]. Thus, pursuant to the Agreement, defendant's use of the Card was her consent to be bound by the Agreement.

In opposition, defendant argues that she applied for the Card in her corporate capacity and not as an individual. Defendant argues that she never signed a personal guarantee for the Card, the Card was never used for personal use, and that she was in an inferior bargaining position. Additionally, defendant states that the inadequate font size of the Agreement, and plaintiff's failure to disclose the provision of the Agreement, constituted deceptive business practices, pursuant to General Business Law (GBL) § 349.

The standards of summary judgment are well settled. Summary judgment is a drastic remedy and should only be granted if the moving party has sufficiently established that it is warranted as a matter of law. Alvarez v Prospect Hosp., 68 NY2d 320, 324 (1986). To grant summary judgment, it must be clear that no material or triable issues of fact are presented. See Stillman v Twentieth Century-Fox Film Corp., 3 NY2d 395 (1957). "The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any material issues of fact from the case". Winegrad v New York University Medical Center, 64 NY2d 851, 853 (1985). Once such entitlement has been demonstrated by the moving party, the burden shifts to the party opposing the motion to "demonstrate by admissible evidence the existence of a factual issue requiring a trial of the action or tender an acceptable excuse for his failure to do so." Zuckerman v City of New York, 49 NY2d 557 (1980). However, the Court of Appeals has made clear that bare allegations or conclusory assertions are insufficient to create genuine, bona fide issues of fact necessary to defeat such a motion. See Rotuba Extruders, Inc. v Ceppos, 46 NY2d 223, 231 (1978).

Here, defendant admits that she applied for and used the Card. Furthermore, plaintiff has proffered documentation showing that Chase Bank assigned its interest in defendant's account to plaintiff, that defendant had a balance on the Card, and that the credit card statements were sent to defendant personally, as well as to Ancient & Classic. The plain language of the Agreement [*4]clearly states that defendant, as the person who applied for the Card and received the Card's statements, was bound by the Agreement when defendant used the Card. Plaintiff has shown that it is entitled to summary judgment, as a matter of law.

Defendant has failed to raise any genuine issues of fact sufficient to defeat plaintiff's motion for summary judgment. Defendant claims that the liability provision in the Agreement was printed in inadequate font size and "buried in the agreement", and thus, plaintiff engaged in deceptive practices, which violate GBL § 349. See Affirmation in Support of Cross Motion, ¶11. Defendant cites to two cases to support her argument. In People v Applied Card Sys., Inc., cited by defendant, the Appellate Division, Third Department held that defendant, alleging that plaintiff violated GBL § 349, must establish that plaintiff "engaged in an act or practice that is deceptive or misleading in a material way and that [the consumer] has been injured by reason thereof." People v Applied Card Sys., Inc., 27 AD3d 104, 106-107 (3rd Dep't 2005)(internal quotations omitted). Here, defendant alleges that she was in an inferior bargaining position and entered into a unilateral contract as a result of plaintiff's failure to conspicuously disclose the liability provision in the Agreement. See Affirmation in Support of Cross Motion, ¶12. However, "[a]lthough the parties clearly do not possess equal bargaining power, this factor alone does not invalidate the contract...[. I]f any term of the agreement is unacceptable to the consumer, he or she can easily...reject [the] agreement". Brower v Gateway 2000, Inc., 246 AD2d 246, 252 (1st Dep't 1998) (Purchasers of Gateway computers are bound by the terms and conditions agreement enclosed in the packaging, upon keeping the merchandise beyond 30 days, pursuant to the terms and conditions agreement.) Here, the liability provision appears on the first page of the Agreement within the first four paragraphs. The Brower court further states, "[t]hat a consumer does not read the agreement or thereafter claims he or she failed to understand or appreciate some term therein does not invalidate the contract any more than such claim would undo a contract formed under other circumstances." Id.

Additionally, CPLR 4544 states that "[t]he portion of any printed contract or agreement involving a consumer transaction...where the print is not clear or legible or is less than eight points in depth or five and one-half points in depth for upper case type may not be received in evidence in any trial". Although CPLR 4544 governs the use of illegible or small font sized contracts as evidence, the Appellate Division, First Department has held that it is the burden of the party objecting to the credit card agreement "to prove that the credit card agreements violate the type-size requirements of CPLR 4544." Tsadilas v Providian National Bank, 13 AD3d 190, 192 (1st Dep't 2004). Here, defendant has failed to satisfy her burden on this defense as she has not provided a copy of said Agreement, with the alleged defective font size, or specify the size of the font used in the Agreement.

Moreover, defendant has not refuted any facts alleged by plaintiff. Defendant merely argues that she did not sign a personal guarantee, and thus, she should not be liable for the outstanding balance on the Card. However, a personal guarantee is not necessary as "[t]he issuance of a credit card constitutes an offer of credit...[and] acceptance of the offer...[is the] use of the card by the holder." Feder v Fortunoff, Inc., 114 AD2d 399 (2nd Dep't 1985). "The terms of the contract are the credit card agreement. A contract will be interpreted in accordance with the intent of the parties as expressed in the language of the agreement." Kelly v Unifund CCR Partners Assignee of Palisades Collection LLC, 2009 US Dist. LEXIS 126059 (SDNY [*5]2009)(internal citations omitted);(citing to Greenfield v Philles Records, Inc., 98 NY2d 562 [2002] and Brower v Gateway 2000, Inc., 246 AD2d 246 [1st Dep't 1998]). By using the Card, defendant accepted the offer and was bound by the Agreement.

Furthermore, when interpreting unambiguous contract provisions, "matters extrinsic to the agreement may not be considered when the intent of the parties can be gleaned from the face of the instrument." See Chimart Assoc. v Paul, 66 NY2d 570, 572-573 (1986). Defendant does not dispute that the plain language of the Agreement provides that the person who applied for the Card, as well as the person to whom billing statements are addressed, is responsible for paying all amounts owed, and that such person is bound by the terms of the Agreement upon the use of the Card. Here, it is uncontested that defendant applied for the Card, used the Card, and received billing statements in her name (as well as statements in the name of the corporation), and thus, is bound by the terms of the Agreement. Defendant's assertions that she should not be bound by the Agreement are insufficient to defeat plaintiff's motion for summary judgment. As such, plaintiff's motion is granted.

Accordingly, it is

ORDERED that defendant's cross-motion is denied in its entirety; and it is further

ORDERED that plaintiff's motion for summary judgment is granted; and it is further

ORDERED that plaintiff is granted judgment against defendant in the amount of $26,380.13, together with interest from the date of May 7, 2010, as calculated by the Clerk, together with costs and disbursements, to be taxed by the Clerk upon submission of an appropriate bill of costs; and it is further

ORDERED that the Clerk is directed to enter judgment accordingly; and it is further

ORDERED that within 30 days of entry of this order, defendant shall serve a copy of this order with notice of entry upon plaintiff.

This is the decision and order of the court.

Dated:January 10, 2012

DORIS LING-COHAN, J.S.C.