Mccarthy v. Bank

• Decision Date: 11 January 2011
• Docket Number: No. CV 08–1122 (ETB).,CV 08–1122 (ETB).
• Parties: James J. McCARTHY, Plaintiff(s),v.WACHOVIA BANK, N.A., Mel S. Harris, and Mel Harris and Associates, LLC, Defendant(s).
• Court: U.S. District Court — Eastern District of New York

759 F.Supp.2d 265

James J. McCARTHY, Plaintiff(s),

v.WACHOVIA BANK, N.A., Mel S. Harris, and Mel Harris and Associates, LLC, Defendant(s).

No. CV 08–1122 (ETB).

United States District Court, E.D. New York.

Jan. 11, 2011.

Irwin Popkin, Esq., by: Irwin Popkin, Esq., Melville, NY, Law Office of Leland L. Greene, by: Leland Greene, Esq., Garden City, NY, for Plaintiff.Rosner Nocera & Ragone, LLP, by: Peter A. Ragone, Esq., John A. Nocera, Esq., John P. Foudy, Esq., New York, NY, for Defendant, Wachovia Bank, N.A.Arthur Sanders, Esq., by: Arthur Sanders, Esq., New York, NY, for Defendants Mel Harris and Mel Harris & Associates, LLP.

MEMORANDUM OPINION AND ORDER

BOYLE, United States Magistrate Judge:

Before the court are motions for summary judgment by the plaintiff and each of the defendants named herein, pursuant to Federal Rule of Civil Procedure 56. For the following reasons, plaintiff's motion for summary judgment is denied, defendants' motions are granted and this action is dismissed in its entirety.

Facts

This action seeks damages arising from the lodging of a post-judgment restraining notice against the plaintiff's out-of-state bank account in Florida, pursuant to New York CPLR Section 5222.

At the time this action was commenced, the plaintiff, James J. McCarthy, resided in Moriches, New York while also maintaining a residence in Venice, Florida, which he and his wife occupied during the winter months. (Pl. Local Civ. R. 56.1 Statement (“Pl. 56.1”) ¶ 1.) Plaintiff and his wife now reside solely in Florida.¹ ( Id.)

Defendant Wachovia was a national banking association organized and existing under the laws of the United States.² (Wachovia Local Civ. R. 56.1 Statement (“Wachovia 56.1”) ¶ 1.) Wachovia maintains its principal place of business in North Carolina and transacts business in numerous jurisdictions, including both New York and Florida. ( Id.) As a result of its multi-jurisdictional presence, Wachovia customers can access their accounts or transact business from any Wachovia branch nationwide. (Wachovia 56.1 ¶ 10.) Wachovia customers can also access their accounts and transact business via the telephone, the internet or at Wachovia ATMs. (Wachovia 56.1 ¶¶ 11–12.)

Defendant Mel S. Harris is a New York attorney who practices law as a partner, member and/or manager of defendant law firm, Mel Harris and Associates, LLC, which is located in New York, New York.³ (Pl. 56.1 ¶ 3.) Part of the Harris Defendants' business includes collecting and attempting to collect debts from consumers on behalf of third parties. (Pl. 56.1 ¶ 4.)

In or about January 2008, plaintiff and his wife opened a bank account at Wachovia's branch located in Venice, Florida to serve their banking needs during the months they resided in Florida. (Pl. 56.1 ¶ 5; Wachovia 56.1 ¶¶ 3–4.) At the time the account was opened, plaintiff and his wife executed a Customer Access Agreement, which contained the following provision:

Acceptance of Terms and Conditions:

I agree to be bound by the terms and conditions including, but not limited to Wachovia's Deposit Agreement and Disclosures, applicable to each product or service which I obtain from Wachovia now or in the future, which terms and conditions will be provided to me. I also agree to pay all fees associated with such products, accounts, and services in accordance with the fee schedules which will be provided to me by Wachovia.

(Pl. 56.1 ¶ 6; Wachovia 56.1 ¶ 6.)

Plaintiff also received a copy of Wachovia's Deposit Agreement and Disclosures for Personal Accounts (the “Deposit Agreement”) at the time he opened his account in Florida. (Pl. 56.1 ¶ 8; Wachovia 56.1 ¶ 7.) The Deposit Agreement contained the following provision:

27. Legal Process Affecting Accounts: If legal action such as an attachment, garnishment, levy or other state or federal legal process (“legal process”) is brought against your account, you may refuse to permit (or may limit) withdrawals or transfers from your account until the legal process is satisfied or dismissed. If we receive any document that appears or is purported to be legal process issued out of any court or government agency, you hereby authorize us to accept and comply with it, no matter how it was received by us. You hereby direct us not to contest on your behalf any such document or legal process and that we may take action to comply with such process as we determine to be appropriate in the circumstances without liability of us to you ... You agree that because we have financial centers or offices in numerous jurisdictions and states other than where your account was opened, if we are served with any process or receive any document as referenced above in or from any jurisdiction or state, you hereby direct us to recognize and honor such service of process.

(Wachovia 56.1 ¶ 8.)

In or about August 2003, a debt collection action was commenced against plaintiff in New York in the Suffolk County District Court, entitled NCO Portfolio Management assignee of Amex Card Corp. v. James McCarthy, Index No. SMC 10443–03. (Pl. 56.1 ¶ 14; Wachovia 56.1 ¶ 18.) Service of process of the complaint in that action was effected on plaintiff by “nail and mail.” (Pl. 56.1 ¶ 15.) On January 4, 2004, a default judgment was entered against plaintiff in the debt collection action in the amount of $8,794.70. (Pl. 56.1 ¶ 16; Wachovia 56.1 ¶ 19.)

On or about January 23, 2008, the Harris Defendants, on behalf of NCO Portfolio Management, attempted to collect on the default judgment by issuing a restraining notice (the “Restraining Notice”) to Wachovia, pursuant to New York CPLR Section 5222. (Pl. 56.1 ¶ 19.) Wachovia's Legal Order Processing Unit, located in Philadelphia, Pennsylvania, received the Restraining Notice on or about February 29, 2008. (Wachovia 56.1 ¶ 20.) The Restraining Notice advised Wachovia that plaintiff was a judgment debtor against whom a judgment in favor of NCO Portfolio Management had been entered and that $8,891.74—which represented the amount of the judgment with interest—remained due and owing. (Wachovia 56.1 ¶ 21; Pl. Ex. 8.) The Restraining Notice also contained the following language:

TAKE NOTICE that pursuant to subdivision (b) of Section 5222 of the Civil Practice Law and Rules, which is set forth in full herein, you are hereby forbidden to make or suffer any sale, assignment or transfer of, or any interference with, any such proceeds or pay over or otherwise dispose of any such debt except as therein provided.

TAKE FURTHER NOTICE that this notice also covers all property in which the judgment debtor has an interest now or hereafter coming into your possession or custody and all debts coming due from you to the judgment debtor.

(Pl. 56.1 ¶ 19; Wachovia 56.1 ¶ 22.)

At the time Wachovia received the Restraining Notice, plaintiff's bank account contained the sum of $5,712.57, which was subsequently restrained by Wachovia. (Wachovia 56.1 ¶ 23.) Wachovia advised the Harris Defendants that it would require a “turnover order” or a “conditional release letter with signatures of [the] account holders” in order to disperse the funds contained in plaintiff's account. (Wachovia 56.1 ¶ 24.)

By letter dated February 29, 2008, Wachovia forwarded plaintiff a copy of the Restraining Notice and advised him that the funds in his account had been restrained. (Pl. 56.1 ¶ 20; Wachovia 56.1 ¶ 26.) The February 29, 2008 letter further advised plaintiff that a $100.00 processing fee had been debited to his account. (Pl. 56.1 ¶ 21.)

Wachovia never dispersed any funds from plaintiff's account, but rather held the funds in suspense, less the $100.00 administrative processing fee. (Wachovia 56.1 ¶ 25.) On March 2, 2009, after one year had elapsed from the time that Wachovia was served with the Restraining Notice, Wachovia lifted the restraint on the funds in plaintiff's account. (Wachovia 56.1 ¶ 28.) On March 4, 2009, plaintiff withdrew the funds from his Wachovia account and directed that his account be closed. (Wachovia 56.1 ¶ 29.) At no time did Wachovia pay out any of the funds that had been restrained pursuant to the Restraining Notice.

Plaintiff commenced the within action on March 18, 2008. Plaintiff subsequently amended his Complaint twice—first on April 15, 2008 and again on January 26, 2010. The Second Amended Complaint contains the following six causes of action: (1) violation of plaintiff's Fourth, Fifth and Fourteenth Amendment rights, pursuant to 42 U.S.C. § 1983; (2) abuse of process (alleged solely against the Harris Defendants); (3) violation of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692(e) (alleged solely against the Harris Defendants); (4) failure to provide plaintiff with notice of the restraining order, pursuant to New York CPLR 5222 (alleged solely against the Harris Defendants); (5) tortious interference with a contractual relationship by the Harris Defendants and breach of contract by Wachovia; and (6) a claim pursuant to the New York General Business Law § 349. Each of the parties now moves for summary judgment on all of the claims alleged in the Second Amended Complaint.

The facts set forth herein are taken from the parties' respective 56.1 statements. However, the Court notes that the 56.1 Statement submitted by the Harris Defendants fails to comply with Local Civil Rule 56.1 in that none of the statements contained therein cite to admissible evidence as support. See Local Civ. R. 56.1(d) (“Each statement by the movant or opponent pursuant to Rule 56.1(a) and (b), including each statement controverting any statement of material fact, must be followed by citation to evidence which would be admissible, set forth as required by Federal Rule of Civil Procedure 56(e)”.). For this reason, the Harris Defendants' 56.1 Statement is disregarded. See Holtz v. Rockefeller & Co., Inc., 258 F.3d 62, 73 (2d Cir.2001) (“[W]here there are no citations or where the cited materials do not support the factual assertions in the [56.1] ...