Carver Fed. Sav. Bank v. Shaker Gardens, Inc.

• Decision Date: 21 January 2016
• Citation: 23 N.Y.S.3d 685,135 A.D.3d 1212
• Parties: CARVER FEDERAL SAVINGS BANK, Respondent, v. SHAKER GARDENS, INC., et al., Appellants, et al., Defendants.
• Court: New York Supreme Court — Appellate Division

135 A.D.3d 1212
23 N.Y.S.3d 685

CARVER FEDERAL SAVINGS BANK, Respondent,
v.
SHAKER GARDENS, INC., et al., Appellants, et al., Defendants.

Supreme Court, Appellate Division, Third Department, New York.

Jan. 21, 2016.

23 N.Y.S.3d 686

Kalter Kaplan Zieger & Forman, Woodbourne (Terry S. Forman of counsel), for appellants.

Jaspan Schlesinger, LLP, Garden City (Scott B. Fisher of counsel), for respondent.

Before: McCARTHY, J.P., EGAN JR., ROSE, LYNCH and CLARK, JJ.

EGAN JR., J.

135 A.D.3d 1212

Appeals (1) from an amended order of the Supreme Court (Cahill, J.), entered June 21, 2013 in Sullivan County, which, among other things, granted plaintiff's motion for a deficiency judgment, and (2) from the judgment entered thereon.

In October 2009, plaintiff commenced this mortgage foreclosure action against, among others, defendant Shaker Gardens, Inc. and Shaker Gardens' president, defendant Yehuda Nelkenbaum, the latter of whom had executed a personal guaranty in conjunction with the underlying transaction. In December 2010, Supreme Court (Sackett, J.) issued a judgment of foreclosure and sale and appointed a referee; plaintiff thereafter purchased the property at a public auction in November 2011 for $4 million, leaving a deficiency of more than $5 million.

Plaintiff subsequently moved to confirm the report of sale and for leave to enter a deficiency judgment and, to that end, enlisted a process server to effectuate service upon Nelkenbaum. According to plaintiff, Nelkenbaum twice was served with a copy of the subject motion—once in a hallway of the U.S. Bankruptcy Court for the Eastern District of New York—located at 271 Cadman Plaza East in Brooklyn—in January 2012 and again approximately one month later in front of a

135 A.D.3d 1213

residence in Brooklyn. Neither Shaker Gardens nor Nelkenbaum submitted papers in opposition to plaintiff's motion but, following the return date thereof, Nelkenbaum moved by order to show cause seeking a determination that he was not personally served. Supreme Court (Cahill, J.) then conducted a traverse hearing,¹ at which Nelkenbaum elected not to testify. By amended order entered June 21, 2013, Supreme Court found that service of process upon Nelkenbaum was valid and thereafter entered judgment against, among others, Shaker Gardens, Nelkenbaum and defendant Shaker Heights Apartments (hereinafter collectively referred to as defendants) for approximately $3 million. Defendants now appeal.

23 N.Y.S.3d 687

We affirm. A party seeking a deficiency judgment may, "[s]imultaneously with the making of a motion for an order confirming the sale, ... make a motion ... for leave to enter a deficiency judgment upon notice to the party against whom such judgment is sought or the attorney who shall have appeared for such party in the action. Such notice shall be served personally or in such other manner as the court may direct" (RPAPL 1371[2] ; see CPLR 308[1] ; D'Ambra v. Haynor, 293 A.D.2d 858, 859, 740 N.Y.S.2d 709 [2002] ). "If a defendant resists service of process, service may be effected pursuant to CPLR 308(1) by leaving a copy of the summons in the defendant's general vicinity, provided that the defendant is made aware that this is being done" (Hall v. Wong, 119 A.D.3d 897, 897, 990 N.Y.S.2d 579 [2014] ; see Bossuk v. Steinberg, 58 N.Y.2d 916, 918, 460 N.Y.S.2d 509, 447 N.E.2d 56 [1983] ; Personnel Sys. Intl. v. Clifford R. Gray, Inc., 146 A.D.2d 831, 832, 536 N.Y.S.2d 237 [1989] ). As a general proposition, "a process server's affidavit of service establishes a prima facie case as to the method of service and, therefore, gives rise to a presumption of proper service" (Caci v. State of New York, 107 A.D.3d 1121, 1123, 967 N.Y.S.2d...