Kastner v. MacLean

• Decision Date: 12 October 2012
• Docket Number: Index No. 100379/2011
• Parties: W. DREW KASTNER, Plaintiff v. MALCOLM MACLEAN, HAWK EYE FISHING CORPORATION, and EAGLE EYE II CORPORATION, Defendants
• Court: New York Supreme Court

2012 NY Slip Op 32594

W. DREW KASTNER, Plaintiff
v.
MALCOLM MACLEAN, HAWK EYE FISHING CORPORATION, and EAGLE EYE II CORPORATION, Defendants

Index No. 100379/2011

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: PART 46

DATED: July 5, 2012
Dated: October 12, 2012

DECISION AND ORDER

LUCY BILLINGS, J.S.C.:

I. BACKGROUND

Plaintiff, a New Jersey attorney, sues to recover damages from defendants' breach of an oral agreement to compensate plaintiff for negotiating contracts with a television series producer on behalf of the two defendant corporations and their single defendant principal. The original contract provided for the producer to exercise an option to extend defendants' role in the series for additional seasons. Plaintiff claims an oral agreement with defendants that he would be paid a commission for any additional seasons for which the producer exercised its option. Since there was no written retainer agreement between plaintiff and defendants, he claims quantum meruit, unjust enrichment, and an account stated, as well as breach of contract.

Defendants move to change the venue of this action to Nassau County, because plaintiff's designation of New York County is without basis, C.P.L.R. §§ 510(1), 511(a) and (b),. and to dismiss

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the complaint due to lack of personal jurisdiction and failure to state a claim. C.P.L.R. § 3211(a)(7) and (8). In moving to dismiss all claims, defendants deny any agreement to pay for additional seasons and deny that plaintiff provided services or conferred any benefit in securing the additional seasons. Because defendants rely on their affidavits and inadmissible documents for their defense of failure to state a claim, rather than any conclusive admissible documents, defendants achieve little more than simply disputing plaintiff's complaint and supplemental evidence. Defendants have withdrawn their motion insofar as it was based on inadequate service, but still claim lack of jurisdiction over the two defendant corporations in New York. C.P.L.R. § 3211(a)(8).

II. VENUE

Although plaintiff designated venue in New York County, C.P.L.R. § 509, because the parties' transactions occurred here, where the parties' transactions occurred is not a basis for venue. C.P.L.R. § 503. Since the only New York resident is defendant MacLean, who resides in Nassau County, venue would lie there. C.P.L.R. § 503 (a) .

To change venue on that basis, defendants must serve a demand to change venue before or with service of their answer. C.P.L.R. § 511(a); Simon v. Usher, 17 N.Y.3d 625, 628 (2011); Herrera v. R. Conley Inc., 52 A.D.3d 218 (1st Dep't 2008); Kurfis v. Shore Towers Condominium, 48 A.D.3d 300 (1st Dep't 2008); Singh v. Becher, 249 A.D.2d 154 (1st Dep't 1998). Defendants

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then may move to change venue within 15 days after service of a demand to which plaintiff fails to respond. C.P.L.R. § 511(b); Simon v. Usher, 17 N.Y.3d at 628; Banks v. New York State & Local Employees' Retirement Sys., 271 A.D.2d 252 (1st Dep't 2000); Singh v. Becher, 249 A.D.2d 154; Newman v. Physicians' Reciprocal Insurers, 204 A.D.2d 210 (1st Dep't 1994). Defendants must strictly comply with these time requirements. Collins v. Greenwood Mgt. Corp., 25 A.D.3d 447, 449 (1st Dep't 2006); Banks v. New York State & Local Employees' Retirement Sys., 271 A.D.2d 252; LaMantia v. North Shore Univ. Hosp., 259 A.D.2d 294 (1st Dep't 1999); Philogene v. Fuller Auto Leasing, 167 A.D.2d 178, 179 (1st Dep't 1990).

Here, defendants served their answer March 28, 2 011, pleading an affirmative defense of improper venue, but neither specifying a proper venue, nor seeking a change. Then, in a letter dated March 30, 2011, defendants demanded a transfer of venue to Nassau County. Defendants acknowledge that their demand was untimely, but maintain that the untimeliness renders their motion to change venue subject to the court's discretion.

The court's discretion regarding defendants' motion following an untimely demand to change venue, when based only on commencement of the action in a county outside C.P.L.R. § 503's scope, is limited to conformance with a contract provision regarding venue, policy dictates that place venue in another county, and consolidation. Newman v. Physicians' Reciprocal Insurers, 204 A.D.2d 210; Pittman v. Maher, 202 A.D.2d 172, 175

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(1st Dep't 1994). See Herrera v. R, Conlev Inc., 52 A.D.3d at 219; Kurfis v. Shore Towers Condominium, 48 A.D.3d at 301; Howard v. New York State Bd. of Parole, 5 A.D.3d 271, 272 (1st Dep't 2 0 04); Banks v. New York State & Local Employees' Retirement Sys., 271 A.D.2d at 2 53. Otherwise the court may not grant the venue change when the demand was untimely. Herrera v. R. Conlev Inc., 52 A.D.3d 218; Newman v. Physicians' Reciprocal Insurers, 204 A.D.2d 210; Pittman v. Maher, 202 A.D.2d at 175.

Defendants do not claim that plaintiff misled defendants as to the propriety of the venue he selected, which would absolve defendants' failure to comply with the statutory time frames. Kurfis v. Shore Towers Condominium, 48 A.D.3d 300; Peretzman v. Elias, 221 A.D.2d 192 (1st Dep't 1995); Pittman v. Maher, 202 A.D.2d at 175; Koschak v. Gates Constr. Corp., 275 A.D.2d 315, 316 (2d Dep't 1996). See Collins v. Greenwood Mqt. Corp., 25 A.D.3d at 449; LaMantia v. North Shore Univ. Hosp., 259 A.D.2d 294; Philoqene v. Fuller Auto Leasing, 167 A.D.2d at 179. Rather than misleading defendants into believing venue was adequately premised, the complaint readily disclosed the lack of basis for the designated venue. Defendants' failure to follow the statutory procedure deprives them of their right to a change and preserves plaintiff's right to his choice of venue. C.P.L.R. §§ 509, 511(b); Herrera v. R. Conlev Inc., 52 A.D.3d 218; Kurfis v. Shore Towers Condominium, 48 A.D.3d 300; Collins v. Greenwood Mgt. Corp., 25 A.D.3d at 449; Howard v. New York State Bd. of Parole, 5 A.D.3d at 272.

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III. DEFENDANTS' MOTION TO DISMISS THE COMPLAINT

A. PERSONAL JURISDICTION OVER THE CORPORATE DEFENDANTS

The complaint alleges that defendant corporations may purport to be corporations, but are in fact unincorporated business entities. Plaintiff's summons lists the same address, 24 0 Causeway, Lawrence, New York, for MacLean and defendant corporations. Defendants contend that the court lacks personal jurisdiction over defendant corporations, because they are nondomiciliaries without any connection to New York State. C.P.L.R. § 302(a). Upon defendants' showing, plaintiff concedes that defendant entities are in fact incorporated, but not their lack of connection to the state.

MacLean's affidavit dated April 7, 2011, attests that MacLean is the president and a shareholder of both Eagle Eye II and Hawk Eye Fishing Corporations, both Delaware corporations with an "official business address" in Wilmington, Delaware. Aff. of Malcolm Maclean ¶¶ 2-3 (Apr. 7, 2011). Defendants also present certificates issued by the United States Department of Homeland Security that the fishing vessels Eagle Eye II and Seahawk are owned by Delaware corporations Eagle Eye II and Hawk Eye Fishing respectively.

On the other hand, defendants present a letterhead and a vessel use agreement that shows Eagle Eye II's address as 240 Causeway, Lawrence, New York. While MacLean denies that the corporate defendants maintain a bank account in New York, defendants also present a check showing Eagle Eye II's address as

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240 Causeway, Lawrence, New York. The Department of Homeland Security certificates, moreover, indicate the corporate defendants' managing officer is at 24 0 Causeway, Lawrence, New York.

Defendants' equivocal evidence that the corporate defendants are nondomiciliaries of New York is an insufficient basis to dismiss the action against them due to lack of personal jurisdiction. E.g., Fischbarg v. Doucet, 9 N.Y.3d 375, 380-81 (2007); Shaltiel v. Wildenstein, 288 A.D.2d 136, 137 (1st Dep't 2001). The burden thus does not shift to plaintiff to establish long arm jurisdiction over nondomiciliary defendants. See C.P.L.R. § 302; Richbell Info. Servs. v. Jupiter Partners, 309

A. D.2d 288, 307 (1st Dep't 2003); Fisher v. McClain, 216 A.D.2d 210 (1st Dep't 1995).

B. FAILURE TO STATE A CLAIM

Upon defendants' motion to dismiss claims pursuant to C. P.L.R. § 3211(a)(7), the court may not rely on facts alleged by defendants to defeat the claims unless the evidence demonstrates the absence of any significant dispute regarding those facts and completely negates the allegations against defendants. Lawrence v. Graubard Miller, 11 N.Y.3d 588, 595 (2008); Goshen v. Mutual Life Ins. Co. of N.Y., 98 N.Y.2d 314, 326 (2002); Leon v. Martinez, 84 N.Y.2d 83, 87-88 (1994); Yoshiharu Igarashi v. Shohaku Higashi, 289 A.D.2d 128 (1st Dep't 2001). The court must accept the complaint's allegations as true, liberally construe them, and draw all reasonable inferences in plaintiff's favor.

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