Citibank (South Dakota), NA v. Jones

• Decision Date: 25 May 2000
• Citation: 708 N.Y.S.2d 517,272 A.D.2d 815
• Court: New York Supreme Court — Appellate Division
• Parties: CITIBANK (SOUTH DAKOTA) N. A., Respondent,<BR>v.<BR>MARY J. JONES, Appellant.<BR>ANDREW F. CAPOCCIA LAW CENTERS, L. L. C., Appellant.

272 A.D.2d 815

708 N.Y.S.2d 517

CITIBANK (SOUTH DAKOTA) N. A., Respondent,

v. MARY J. JONES, Appellant.ANDREW F. CAPOCCIA LAW CENTERS, L. L. C., Appellant.

Carpinello, J.

05-25-2000

Cardona, P. J., Mercure, Graffeo and Mugglin, JJ., concur.

Carpinello, J.

Plaintiff brought this action for breach of contract and account stated to recover $2,003.57, the claimed balance due on a Visa credit card. In her answer, defendant asserted one affirmative defense, namely, failure to state a cause of action. At issue on appeal is an order of Supreme Court which granted plaintiff summary judgment on the account stated cause of action, as well as an order of the court which sanctioned defendant's attorney for frivolous conduct under 22 NYCRR part 130. We affirm both orders.

"An account stated is an agreement between parties to an account based upon prior transactions between them with respect to the correctness of the account items and balance due" (Jim-Mar Corp. v Aquatic Constr., 195 AD2d 868, 869, lv denied 82 NY2d 660; see, Interman Indus. Prods. v R.S.M. Electron Power, 37 NY2d 151, 153-154). The agreement may be implied by the retention of an account statement for an unreasonable period of time without objection (see, Jim-Mar Corp. v Aquatic Constr., supra, at 869). In support of summary judgment, plaintiff submitted an affidavit from one of its managers who performs collection and recovery services. She averred that in performing her duties she is "familiar with the manner and method by which [plaintiff] creates and maintains its normal-books and records, including computer records of its credit accounts". According to this manager, plaintiff maintains, as a regular part of its business, computer records of all outstanding balances on its customers' credit accounts and it was the regular practice of plaintiff's business to send customers monthly statements detailing these balances, as well as purchases made and payments received.

Through these entries, she had "full knowledge" of the account stated which arose out of plaintiff having extended credit to defendant via the credit card which defendant used to purchase goods and services. Although defendant was sent monthly statements indicating the "full and true accounts of [her] indebtedness", an outstanding balance remained unpaid, which as of August 27, 1998 had reached nearly $2,000. The manager further averred that plaintiff's records indicated that "[d]efendant neither disputed the validity of the balance owed nor notified [p]laintiff of any claims, defenses, offsets or counterclaims whatsoever to the balance due and owing". These submissions adequately demonstrated "that `there was an account between the parties and that a specified balance was found to be due'" (Maines Paper & Food Serv. v Restaurant Mgt. by D.C. Corp., 229 AD2d 748, 750, quoting United Consol. Indus. v Mendel's Auto Parts, 150 AD2d 768, 769) and sufficiently made out a prima facie case of an account stated (see, id.; see generally, Barclay's Bank v Smitty's Ranch, 122 AD2d 323, 324).

In opposing plaintiff's motion for summary judgment, defendant submitted her own affidavit and that of counsel. Notably, in her affidavit, defendant did not deny that she had made purchases with the credit card. She did not deny that she had received monthly statements from plaintiff indicating purchases made, payments received and balances due. Nor did she allege that she ever once objected to any particular charge or statement of balance due. Under these circumstances, we find that Supreme Court did not err in granting plaintiff summary judgment on the account stated cause of action since defendant impliedly agreed to pay the amount indicated when she received and retained the monthly statements without objection within a reasonable period. Indeed, defendant did not object at any time, including in her own affidavit in opposition to plaintiff's motion for summary judgment (see generally, Schneider Fuel Oil v DeGennaro, 238 AD2d 495, 496; PPG Indus. v A.G.P. Sys., 235 AD2d 979; Fink, Weinberger, Fredman, Berman & Lowell v Petrides, 80 AD2d 781, appeal dismissed 53 NY2d 1028).^[1]

Turning next to the propriety of Supreme Court's decision to sanction defense counsel, we first find no procedural infirmities in the order. In addition to submitting a written response to the issue of sanctions, counsel was given two opportunities to appear before Supreme Court to address the issue (see, 22 NYCRR 130-1.1 [d]). Thus, a reasonable opportunity to be heard was given (see, id.). Moreover, the court issued a detailed written decision outlining the factors it considered in finding frivolous conduct (see, 22 NYCRR 130-1.2).

From a substantive standpoint, we perceive no abuse of discretion in Supreme Court's decision to impose sanctions for frivolous conduct (see, 22 NYCRR 130-1.1 [a]). Conduct is frivolous if it is completely without merit in law and cannot be supported by a reasonable argument for an extension, modification or reversal of existing law; if it is undertaken primarily to delay or prolong the resolution of litigation or to harass or maliciously injure another; or if it constitutes the assertion of material factual statements that are false (see, 22 NYCRR 130-1.1 [c] [1]-[3]). In determining whether the conduct undertaken was frivolous, a...