Gonzales v. Tuttman

Citation59 F. Supp. 858
PartiesGONZALES v. TUTTMAN et al.
Decision Date30 January 1945
CourtU.S. District Court — Southern District of New York

Moses M. Cohen, of New York City, for plaintiff.

Rigby, Leon & Weill, of New York City, for defendants.

GODDARD, District Judge.

Motion by the defendants Louis Tuttman and Leonard Tuttman for summary judgment under Rule 56 of the Federal Rules of Civil Procedure, 28 U.S.C.A. following section 723c, on the grounds that the plaintiff's alleged causes of action are barred by the statute of limitations of New York, § 13, Civil Practice Act, and by various sections of the Civil Code of Puerto Rico and the Code of Civil Procedure of Puerto Rico.

This action was commenced in this court by the filing of the complaint on May 19, 1944. The defendants Louis Tuttman and Leonard Tuttman have appeared by their attorney. The defendants Alice Tuttman and Ell Tee, Inc., a Puerto Rican corporation, have not been served in this action which was brought by the plaintiff in her own behalf and by written authority in behalf of some three hundred other employees similarly situated, and a similarly situated group of judgment creditors from whom no authority has yet been obtained.

Five causes of action are alleged. The first is based upon the Fair Labor Standards Act, 29 U.S.C.A. § 201 et seq., and alleges in effect that the plaintiffs were employed by the defendants in various cities in the territory of Puerto Rico in the production of goods for interstate commerce within the purview of the Fair Labor Standards Act later referred to as the Act; that the plaintiffs were paid less than the minimum wage and that the individual defendants appearing herein and the defendant corporation were jointly engaged, as a common venture, in the production, etc. of goods for interstate commerce and that plaintiffs are entitled to recover the unpaid minimum wages and liquidated damages as provided for under Section 16(b) of the Act as against these defendants as an "employer" within the definition of Section 3 of the Act.

The Second cause of action incorporates the allegations contained in the first cause of action and is further founded on two judgments rendered by the District Court of the United States for Puerto Rico, one entered against all defendants on May 28, 1943, entitled "Vives v. Ell Tee, Inc., Louis Tuttman, Leonard Tuttman and Alice Tuttman"; the other entitled "Vega v. Ell Tee, Inc., et al" was entered on December 23, 1942, against the corporation alone. The plaintiff in the suit at bar and those in whose behalf she sues with written authority, appeared in one or the other action. Both actions were based on the Act.

The Third cause of action incorporates the allegations contained in the First cause of action and further alleges that Ell Tee, Inc., was a dummy or shell for the individual defendants and that the failure of that corporation to pay the judgments referred in the Second cause of action was attributable to the deliberate fraud or scheme of the individual defendants to avoid their obligation, and therefore the plaintiff prays that the corporate entity be disregarded and that the individual defendants be held liable as the real "employer" of the plaintiff pursuant to Section 3(d) of the Act.

The Fourth cause of action seeks relief from the individual defendants pursuant to Section 35 apparently inadvertently numbered 55 in the complaint of the General Corporation Law of Puerto Rico which, in substance, provides that the officers, directors or stockholders of a corporation formed and operating in the territory of Puerto Rico who authorized the incurrence of a debt by the corporation in excess of the paid up value of its capital stock, shall be jointly and severally liable individually for the amount of such indebtedness, and that such liability shall be enforced by action brought by any creditor who establishes that judgment has been rendered for his claim and that the liquidated assets of the corporation have not been sufficient to pay the judgment; and further alleges that the individual defendants are the sole stockholders, directors and owners of Ell Tee, Inc.; that the said corporation was insolvent and failed to pay its lawful obligations and that the paid-up capital assets of the corporation were insufficient to pay the obligation.

The Fifth cause of action is alleged to be based upon Section 71 of the General Corporation Law of New York and alleged to be similar in scope to Section 35 of the General Corporation Law of Puerto Rico and providing similar relief.

The defendants in their second amended answer deny all of the substantial allegations in each of the causes of action as set forth in the complaint, and any liability under Section 35 of the General Corporation Law of Puerto Rico or Section 71 of the General Corporation Law of New York.

The second amended answer then sets forth five separate distinct and affirmative defenses. The First and Third affirmative defenses allege that the First and Third causes of action are barred by the Statute of Limitations of New York Section 13, Civil Practice Act and by Sections 1830-2 and 1867 of the Civil Code of Puerto Rico Ed.1930 which allegedly provide that a cause of action "for the payment of mechanics, servants and laborers the amounts due for their services * * * shall prescribe in three years."

The Second affirmative defense states that the judgment of May 28, 1943, of the District Court of Puerto Rico set forth in the Second cause of action is void as against them as individuals as they neither appeared nor were served in the action and that the judgment, since its rendition, has been vacated as against these individual defendants by an order of the district court of Puerto Rico dated June 24, 1944, and further states that the judgment of December 23, 1942, is likewise ineffective as against them as individuals as they neither appeared nor were served and judgment was entered solely against the said corporation.

The Fourth and Fifth affirmative defenses set up the New York Statute of Limitations Section 13, Civil Practice Act and Section 1867(3) of the Civil Code of Puerto Rico, and Section 47 of the Puerto Rican Code of Civil Procedure, as well as incorporating the other sections of the Civil Code of Puerto Rico set forth in the First affirmative defense as a bar to the Fourth and Fifth causes of action. The plaintiffs in reply deny the substantial allegations of the second amended answer and specifically set forth allegations in answer to the affirmative defenses and state that the running of the Statute of Limitations as set forth in Section 1867 (3) of the Civil Code of Puerto Rico was tolled pursuant to Section 39 of the Code of Civil Procedure of Puerto Rico due to the absence of the individual defendants from the jurisdiction of Puerto Rico — hence this action is timely.

In reply to the Second affirmative defense plaintiff states that as the actions upon which the judgments referred to in the Second cause of action were instituted on April 1st and April 8, 1941, against all the defendants, this tolled the Statute of Limitations pursuant to Section 1873 of the Civil Code of Puerto Rico, and further alleges that the payment by the individual defendants of $500 to the Special Master as a part of his fee after the entry of judgment was an "act of acknowledgment of the debt by the debtor" which likewise tolled the statute. This part of the reply further states that insofar as the judgment of December 23, 1942 is concerned the individual defendants waived personal service by the appearance of their attorneys on several motions and that the order of June 24, 1944 vacating the judgment of May 28, 1943 as against these individual defendants is null and void since the plaintiffs had no knowledge or notice of such order.

In reply to the Third, Fourth and Fifth affirmative defenses it is alleged that Section 47 of the Code of Civil Procedure of Puerto Rico provides that the three year period of limitation shall start running from the time of discovery of the facts upon which the liability was created by law and that these facts were only discovered after the entry of the judgments against the corporation on December 23, 1942, and May 28, 1943.

The reply contains a further allegation that Section 40(1) of the Code of Civil Procedure of Puerto Rico which tolls the Statute of Limitations during infancy, tolled the statute here as to many of the plaintiffs who were minors when the cause of action accrued.

The defendants now move for summary judgment on each and every cause of action.

This is an action primarily based on Section 16(b) of the Fair Labor Standards Act, 29 U.S.C.A. § 216(b), and is to recover a civil liability. Overnight Motor Co. v. Missel, 316 U.S. 572, 62 S.Ct. 1216, 86 L.Ed. 1682. There is no Statute of Limitations contained within the Act nor is there any federal statute of limitation applicable thereto. Therefore, this court must look to the appropriate state Statute of Limitations. Loggins v. Steel Const. Co., 5 Cir., 129 F.2d 118; see also Abram v. San Josquin Cotton Oil Co., D. C., 46 F.Supp. 969; compare Reliance Storage & Inspection Co. v. Hubbard, D. C., 50 F.Supp. 1012 with Klotz v. Ippolito, D.C., 40 F.Supp. 422.

Which state Statute of Limitations applies, namely, whether that of New York or that of Puerto Rico where the cause of action arose, is essentially a question involving conflict of laws. Huber v. Hilla von Reboy, Civil 23-170, decided August 29, 1944, unreported opinion of Judge Knox.

In deciding what law applies this court must follow the New York state principles of conflict of laws....

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7 cases
  • Swick v. Glenn L. Martin Co.
    • United States
    • U.S. District Court — District of Maryland
    • 23 Octubre 1946
    ...a liability created by a statute other than a penalty or forfeiture. See Culver v. Bell & Loffland, 9 Cir., 146 F.2d 29; Gonzales v. Tuttman, D.C., 59 F.Supp. 858. In still other jurisdictions where the period of limitations for an oral contract and that for a liability created by statute a......
  • Hire v. EI DuPont De Nemours & Company, 15277.
    • United States
    • U.S. Court of Appeals — Sixth Circuit
    • 18 Noviembre 1963
    ...the Alvado case is not helpful because the point was stipulated and it is in conflict with the decision in the case of Gonzales v. Tuttman (S.D.N.Y., 1945), 59 F.Supp. 858. It is true that the point was stipulated, and the Court did not consider the legal question except to adopt the stipul......
  • Leveski v. HYDRAULIC ELEVATOR & MACHINE CO.
    • United States
    • U.S. District Court — Southern District of New York
    • 30 Marzo 1965
    ...against said moving parties. Sprague v. Vogt, 150 F.2d 795 (8th Cir. 1945), mdf'd 164 F.2d 312 (8th Cir. 1947); Gonzales v. Tuttmann, 59 F.Supp. 858, 861 (D.C.N.Y. 1945); Van Alen v. Aluminum Co. of America, 43 F.Supp. 833, 837 (D.C.N.Y. 1942); Revlon, Inc. v. Regal Pharmacy, Inc., 29 F.R.D......
  • Sherman v. Kirshman
    • United States
    • U.S. Court of Appeals — Second Circuit
    • 21 Diciembre 1966
    ...and defendant denies it, there is an issue of fact that cannot be brushed aside on a motion for summary judgment. Gonzales v. Tuttman, 59 F.Supp. 858 (S.D. N.Y.1945); 6 Moore's Federal Practice, Par. The case for summary judgment here is weaker because the record before us does not state th......
  • Request a trial to view additional results

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