City Nat'l Bank, N.A. v. Lake St. 1, LLC
| Decision Date | 14 February 2013 |
| Docket Number | No. 7526/2012.,7526/2012. |
| Citation | 2013 N.Y. Slip Op. 50244,38 Misc.3d 1224,969 N.Y.S.2d 802 |
| Parties | CITY NATIONAL BANK, N.A., Plaintiff, v. LAKE STREET 1, LLC and Imre Englander, Defendants. |
| Court | New York Supreme Court |
OPINION TEXT STARTS HERE
Jason A. Nagi, Esq., Polsinelli Shughart PC, New York, Attorney for Plaintiff.
Stuart Thalblum, Esq., Cohen, LaBarbera & Landrigan Goshen, Attorney for Defendants.
The following papers numbered 1 to 5 were read on Plaintiff's motion for summary judgment in lieu of complaint pursuant to CPLR § 3213:
Notice of Motion/Attorney's Statement/Exhibits A to C 1–2
Affirmation of Stuart Thalblum, Esq. in Opposition/Affirmation of
Imre Englander/Exhibit A 3–4
Upon reading the foregoing papers, it is ORDERED that the motion for summary judgment is granted, for the reasons which follow.
Plaintiff City National Bank seeks to enforce a Connecticut judgment that was entered against Defendants Lake Street 1, LLC (“Lake Street”) and Imre Englander (“Englander”) on default, pursuant to Plaintiff's motion for deficiency judgment. Plaintiff filed a foreclosure action against Defendants in Connecticut Superior Court, concerning real property located in New Haven, Connecticut that was purchased by Lake Street. Lake Street obtained a mortgage from Imperial Capital Bank in the sum of $255,174.55, secured by a note, both of which were later transferred to Plaintiff after Imperial was liquidated by the Federal Deposit Insurance Corporation. Englander executed the loan documents on behalf of Lake Street, in his capacity as Operating Manager, and furnished a personal guaranty on the entire indebtedness.
Following Defendants' failure to pay the mortgage, Plaintiff commenced the foreclosure action and obtained a judgment of “strict foreclosure” on June 7, 2010, and title to the property on August 5, 2010. See Notice of Motion, Exhibit C, Connecticut Judgment dated April 1, 2011. The property was valued at $250,000.00 and the mortgage debt as of the filing of Plaintiff's motion for deficiency judgment amounted to $304,198.06. Id. Plaintiff obtained a deficiency judgment in the sum of $54,198.06, representing the difference between the mortgage and the value of the property, which was entered by the Connecticut court in April, 2011. Plaintiff now seeks to enforce the Connecticut deficiency judgment in New York through the instant motion for summary judgment in lieu of complaint, as Lake Street and Englander are New York domiciliaries.
In an action such as the instant proceeding where the only relief requested is the payment of money based upon a judgment, CPLR § 3213 permits summary judgment in lieu of a complaint. The standard for granting such motions is the same as that set forth under CPLR § 3212, which provides that a motion for summary judgment “shall be granted if, upon all of the papers and proof submitted, the cause of action or defense shall be established sufficiently to warrant the court as a matter of law in directing judgment in favor of any party .” Banco Popular North America v. Victory Taxi Management, Inc., 1 NY3d 381, 382 [2004].
The mechanism provided by CPLR § 3213 is well-recognized to allow for expeditious resolution of claims that are “presumptively meritorious”. Interman Indus. Prods. v. R.S.M. Electron Power, 37 N.Y.2d 151, 154 [1975]. Once a plaintiff meets its burden of establishing an unconditional right to payment, the burden shifts to the defendant to supply evidentiary proof that there are genuine issues of fact necessitating a trial. See Banque Indosuez v. Eftim Pandeff, 193 A.D.2d 265, 603 N.Y.S.2d 300 [1st Dept 1993]. Summary judgment may not be defeated by “averments merely stating conclusions, of fact or of law.” Banco Popular, 1 NY3d at 383 (quoting Mallad Constr. Corp. v. County Fed. Sav. & Loan Assn., 32 N.Y.2d 285, 290 [1973] ).
Plaintiff submits a copy of the summons dated August 27, 2012, and accompanying motion which were served upon Englander by substitute service on his wife. In support of its motion, Plaintiff furnishes a copy of the foreclosure complaint in the Connecticut action and copies of the promissory note and mortgage, signed by Englander as Operating Manager of Lake Street; a UCC–1 Financing Statement; and the Guaranty signed by Englander, individually. Plaintiff provides a copy of the papers related to the liquidation of Imperial Capital Bank, the initial mortgagee, and the transfer of the subject mortgage to Plaintiff; and a copy of the Notice of Lis Pendens that Plaintiff filed in the Connecticut court. In addition, Plaintiff submits a copy of the Officer's Return Writ, Summons, Complaint & Lis Pendens, executed by Mark J. White, State Marshal New Haven County, attesting to service upon Defendants herein of the summons and complaint and lis pendens in the Connecticut action, by serving the Secretary of State of Connecticut. Plaintiff also provides a certified copy of the Connecticut judgment.
By these submissions, Plaintiff has satisfied its initial burden of establishing a prima facie case for summary judgment in lieu of complaint, thereby shifting the burden to Defendants to present admissible evidence sufficient to establish a triable issue of fact. See Bronsnick v. Brisman, 30 AD3d 224, 819 N.Y.S.2d 492 [1st Dept.2006]; Friends Lumber, Inc. v. Cornell Development Corp., 243 A.D.2d 886, 887, 663 N.Y.S.2d 327 [3rd Dept.1997].
In opposition, Defendants contend that the motion should be denied on the ground that it “was improperly served on Mr. Englander on a High Holy Day in violation of N.Y. General Business Law § 13 and applicable case law.” Thalblum Affirmation at ¶ 2(a). Defendants also assert that the Connecticut judgment is defective because the court did not obtain personal jurisdiction over Englander through Plaintiff's service of process upon the Secretary of State of Connecticut rather than on Englander personally.
Defendants charge Plaintiff with knowledge that Englander is an observant orthodox Jew. They assert that it was improper for Plaintiff to have Englander served with process the day after Yom Kippur, claiming that it constitutes a violation of General Business Law § 13, because “the entire period between Yom Kippur and Sukkos is considered to be a holy period.” Affirmation in Opposition at ¶ 5 (internal parentheticals omitted).
General Business Law § 13 provides:
“Whoever maliciously procures any process in a civil action to be served on Saturday, upon any person who keeps Saturday as holy time, and does not labor on that day, or serves upon him any process returnable on that day, or maliciously procures any civil action to which such person is a party to be adjourned to that day for trial, is guilty of a misdemeanor.”
This section has been construed to extend to religious holidays. SeeCarmody–Wait 2d New York Practice § 24:88 (September 2012); Hirsch v. Zvi, 184 Misc.2d 946, 712 N.Y.S.2d 238 [Civ Ct, Kings County 2000] .
The Court acknowledges that Yom Kippur is recognized as a religious holiday. The Court is sensitive to Mr. Englander's religious beliefs, including his professed belief that the entire period between Yom Kippur and Sukkos is a holy period, and does not wish to offend such beliefs. However, the day after Yom Kippur is not generally recognized as a religious holiday.1 Therefore, General Business Law § 13 cannot be extended to cover the day after Yom Kippur, and service of the summons and motion in this action on that day was valid and proper.
Defendants also address Plaintiff's motion on the merits, arguing that the motion must be denied because the Connecticut court failed to obtain in personam jurisdiction over Englander, a nonresident individual. Defendants contend that Englander was never personally served and that service of process on the Secretary of State of Connecticut cannot confer personal jurisdiction over Englander in a Connecticut court. Defendants also complain that as a result of the lack of proper notice, Defendants could not contest the valuation of the property and the judgment against them was entered by default.
“While a default judgment of a sibling state such as [Connecticut] is conclusive on the merits and entitled to full faith and credit in this State, New York courts may address the issue of whether the rendering State had personal jurisdiction over the nonappearing party against whom that judgment was obtained, an inquiry which includes Federal due process considerations.” Schulz v. Barrows, 263 A.D.2d 565, 566, 693 N.Y.S.2d 658 [3rd Dept 1999] (). If the Court determines that the Connecticut court lacked in personam jurisdiction over Englander, the underlying judgment cannot be enforced against him.2
To determine whether the Connecticut court lacked in personam jurisdiction over Englander, the Court must consider Connecticut's long-arm statute, Conn. Gen.Stat. § 52–59b, and Federal due process principles. Schulz, 263 A.D.2d at 567.Connecticut General Statutes § 52–59b states in part:
“(a) As to a cause of action arising from any of the acts enumerated in this section, a court may exercise personal jurisdiction over any nonresident individual, or foreign partnership, or his or its executor or administrator, who in person or through an agent: (1) Transacts any business within the state ... or (4) owns, uses or possesses any real property situated within the state.”
Plaintiff contends that personal jurisdiction over Defendants was proper based upon Conn. Gen.Stat. § 52–59b(1) and (4), and over Englander in particular under §...
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