Nemetsky v. Banque de Developpement de la Republique du Niger

• Decision Date: 31 July 1978
• Parties: , 65 A.D.2d 748 Aaron NEMETSKY, Respondent-Appellant, v. BANQUE de DEVELOPPEMENT de la REPUBLIQUE du NIGER, Appellant-Respondent, et al., Defendants.
• Court: New York Supreme Court — Appellate Division

Page 556

407 N.Y.S.2d 556

64 A.D.2d 694, 65 A.D.2d 748

Aaron NEMETSKY, Respondent-Appellant, v. BANQUE de DEVELOPPEMENT de la REPUBLIQUE du NIGER Appellant-Respondent, et al., Defendants.

Supreme Court, Appellate Division, Second Department.

July 31, 1978.

Cowan, Liebowitz & Latman, P. C., New York City (Michael F. Mascio and Alan E. Greenberg, New York City, of counsel), for appellant-respondent.

Reuben Blum, New York City, for respondent-appellant.

Before GULOTTA, J. P., and SHAPIRO, COHALAN and O'CONNOR, JJ.

MEMORANDUM BY THE COURT.

In an action inter alia on a foreign draft ("trade acceptance"), defendant Banque de Developpement de la Republique du Niger (Banque) and plaintiff cross-appeal from an order of the Supreme Court, Kings County, dated February 16, 1978, which, upon Banque's motion to dismiss for lack of jurisdiction and plaintiff's cross motion to confirm and prove the grounds upon which an attachment order was issued, directed that a hearing be held as to the jurisdictional facts, following plaintiff's opportunity to obtain disclosure.

Order reversed, on the law, without costs or disbursements, Banque's motion to dismiss granted and plaintiff's cross motion denied.

Plaintiff claims that he is owed $85,000 on a draft or trade acceptance guaranteed by Banque. The draft, made in Nigeria, is payable to one Herbert Steed and was drawn by defendant El Hadj Mahaman Yahaya. Plaintiff also claims that the draft is integrally related to Banque's deposit with Credit Lyonnais (New York branch) under a letter of credit naming Cornwall Maritime (of which Steed is a principal) as beneficiary. Banque moved to dismiss for lack of in personam or in rem jurisdiction. Plaintiff cross-moved to confirm an order of attachment on Banque's deposit with Credit Lyonnais.

Special Term directed a hearing to determine the facts concerning Banque's activities in New York. We hold that there is no basis for jurisdiction by plaintiff over Banque. First, the "doing business" standard plaintiff alleges as a basis for jurisdiction (see CPLR 301) has not been met. Second, an essential criterion for long-arm jurisdiction under CPLR 302 (subd. (a), part. 1) is that the cause of action must arise out of the business transacted in New York. Plaintiff's claim that the trade acceptance arises out of the letter of credit deposit Banque has with Credit Lyonnais in New York is not substantiated.

The trade acceptance on its face gives no evidence of any relationship to the New York deposit. The draft, drawn in Nigeria by defendant El Hadj and guaranteed by Banque, May be related to the same business interest that prompted the letter of credit deposit. That business interest does not, however, transform one item into the other. The two transactions remain discrete. The trade acceptance is not shown to have arisen out of the business transacted by Banque when it opened the letter of credit at Credit Lyonnais.

Even if the trade acceptance were shown to be part of the correspondent bank relationship, that relationship does not itself provide the basis for long arm jurisdiction under CPLR 302 (subd. (a), par. 1) (see Amigo Foods Corp. v. Marine Midland Bank N. Y., 39 N.Y.2d 391, 384 N.Y.S.2d 124, 348 N.E.2d 581; Taub v. Colonial Coated Textile Corp., 54 A.D.2d 660, 387 N.Y.S.2d 869; National Amer. Corp. v. Federal Republic of Nigeria, D.C., 425 F.Supp. 1365, 1361).

Since that is so, the minimum contacts necessary to satisfy due process requirements in the exercise of quasi in rem jurisdiction under the attachment are also absent (see Shaffer v. Heitner, 433 U.S. 186, 97 S.Ct. 2569, 53 L.Ed.2d 683). If a correspondent bank relationship, standing alone, does not provide sufficient contacts for the exercise of long-arm jurisdiction, it gains no enhanced status when it is offered to satisfy due process prerequisites for an attachment.

Neither assertion by plaintiff, (1) that Banque "has spread on the record the precise nature of its (close) relationship with Credit Lyonnais", nor (2) that Credit Lyonnais and Banque share a "special kinship" through the affiliation of Nigeria with the West African Monetary Union and ultimately with the French Government Bank, suffices to advance the...