Present: HON. UTE WOLFF LALLY, Justice TRIAL/IAS, PART 17 NASSAU COUNTY SLENDER DELIGHT, INC. d/b/a S.D. Brands, Plaintiff(s), Defendant(s).
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1 SHORT FORM ORDER SUPREME COURT - STATE OF NEW YORK Present: HON. UTE WOLFF LALLY, Justice TRIAL/IAS, PART 17 NASSAU COUNTY SLENDER DELIGHT, INC. d/b/a S.D. Brands, -against- Plaintiff(s), MOTION DATE: 8/7/01 INDEX No.:17336/00 MOTION SEQUENCE NO:2 YOGURT & SUCH FRANCHISE SYSTEMS, INC., Defendant(s). The following papers read on this motion: Notice of Motion/ Order to Show Cause Answering Affidavits Replying Affidavits... 8,9 Briefs... 10,ll Upon the foregoing papers, it is ordered that this motion by defendant for, inter alia, an order pursuant to CPLR 317 and 5015(a)(l) vacating a default judgment dated March 2, 2001, entered against the defendant upon its failure to oppose the plaintiff's motion for'summary judgment in lieu of complaint is disposed of as follows. In April of 1994, the plaintiff, a New Jersey Corporation, entered into a so-called "Distribution Agreement" with the defendant, pursuant to which the plaintiff agreed, inter alia, to "distribute on behalf of Y & S, all Y & S yogurt only to Y & S stores." The agreement lists defendant's address as 438 Woodbury Avenue, Plainview, New York, and further provides that any notices transmitted thereto were to be sent to the above-noted location. In December of 1999, the Eskimo Pie Corporation commenced an action against the plaintiff in the Superior Court, Essex County, of the Stateof NewJersey. Plaintiff interposed an answer in the New Jersey proceeding and also commenced a third party action against the defendant, alleging, inter alia, that defendant had breached the "Distribution Agreement" by refusing to pay for goods and/or services supplied to it in accord with the agreement. _ Service.of the third party complaint upon the defendant was allegedly made by leaving a copy of the summons and complaint with -_
2 -2- Index an individual denominated in the process servers's affidavit as a, "manager" of premises allegedly operated by the defendant at 1504 Old Country Road, in Westbury, New York. In August of 2000, and upon the defendant's failure to appear with respect to the third party complaint, a "Final Judgment by Default," in the principal sum of $23, was entered by the clerk of the New Jersey Superior Court. By notice of motion dated October 20, 2000, the plaintiff brought on a motion in the Supreme Court, Nassau County, for summary judgment in lieu of complaint (CPLR 3213), predicating its entitlement to recovery solely upon the above-referenced, New Jersey default judgment. Notably, service of the motion papers was allegedly accomplished pursuant to Business Corporations Law 306, through delivery of the papers to the Secretary of State. Prior thereto, the plaintiff claims that it unsuccessfully attempted service upon the defendant at a Hicksville address, which it notes was printed on a check it received from an entity known as "Yogurt & Such Westbury, Inc.". No efforts were made to effect service at the Plainview address contained in the agreement. By order dated December 22, 2000, and upon the defendant's failure to submit opposition papers, this court granted the plaintiff's motion for summary judgment in lieu of complaint. A judgment dated March 2, 2001, was subsequently entered upon the foregoing order. The defendant now moves by order to show cause for, inter alia, vacatur of the March 2, 2001, default judgment, arguing, among other things, that it did not receive the plaintiff's motion papers in the subject New York action: that service was not properly effectuated in the underlying New Jersey action, and that the New Jersey Superior Court lacked the requisite jurisdictional predicate to sustain the exercise of in personam jurisdiction. The motion is granted to the extent indicated below. In order to vacate a default pursuant to the "ameliorative provisions" of CPLR 317 (Dye v Columbia, 280 AD2d 513, 514), "a defendant must show that he or she did not receive actual notice of the summons in time to defend the action and a meritorious defense" (DiBlasio v Kaufman, 282 AD2d 496; Trujillo v ATA Housing Corp., 281 AD2d 538; Dye v Columbia, supra see also, Udell v Alcamo Supply & Contracting Corp., 275 AD2d 453 see also, Di Lorenzo, Inc. va.c. Dutton Lumber Co., Inc., 67 NY2d 138, 141-2; 2 Weinstein-Korn- Miller, New York Civil Practlra, ).
3 -3- Index Here, the defendant has submitted the sworn statements of its president, Alfonso Spennato,. who avers that the defendant never received a copy of the summons motion papers allegedly delivered to the Secretary of State, (cf. Friedman v Ramlal, 282 AD2d 499; OCI Mortgage Corp. v CXnar, 232 AD2d 462; Dime Sav. Bk. v of NY v Steinman, 206 AD2d 404). The court notes that the plaintiff's submissions do not contain probative documentary proof, including relevant affidavits of service etc., attesting to the manner in which the'process was delivered to the Secretary of State. Nor has evidence been produced which confirms, in fact, that the Secretary of State transmitted process "to the address designated by the [defendant]" (Board of Managers v 263 River Avenue Corp., 243 AD2d 668, 669; Business Corporation Law, 306 [billi, [21). Further, there is nothing in the plaintiff's opposition papers demonstrating that the summons and motion papers were thereafter mailed to the defendant in accord with CPLR 3215[gl[4l[il (see also, BCL 306[bl[21), or that - as mandated by CPLR 3215[gl[4][iil - an affidavit attesting to the above-noted mailing was executed and filed with the subject default judgment (see, Ocuto Blacktop & Paving Co., Inc. v Trataros Const., Inc., 277 AD2d 919; Miron Limber Co. v Phylco Realty Dev. Co., 151 Misc2d 139, 144 see generally, 7 Weinstein-Korn-Miller, New York Civil Practice, ). It also bears noting that prior to its resort to BCL 306, the plaintiff did not attempt service upon the defendant at the address listed for it in the agreement sued upon (cf. Trujillo v ATA Housing Corporation, supra; Stein v Matarasso & Co., Inc., 143 AD2d 825; H.K.A. Realty Co. v United Steel and Strip Corp., 88 AD2d 612). Significantly, the foregoing address is designated in the parties' agreement as the one to which any written notices intended for the defendant were to be sent. Lastly, upon review of the parties' submissions, the court concludes that the defendant has demonstrated that it possesses potentially meritorious jurisdictional defenses to the plaintiff's claims, which claims hinge upon the viability of the New Jersey default judgment.. In light of the foregoing, and considering the "strong public policy" favoring disposition of matters on the merits (see, Dye v Columbia, supra, at 514), the Court will exercise its discretion and grant the defendant's application to vacate (i) the March 2, 2001, default judgment; and (ii) its default in opposing the underlying motion for summary judgment in lieu of complaint. In accord with CPLR 3213, the.plaintiff's original motion papers and the defendant's presently submitted vacatur application shall be deemed, respectively, the complaint and answer in the action (Gurary v Light, 248 AD2d 507).
4 -4- Index Lastly, that branch of the motion which is, in effect, for, a determination that the New Jersey Superior Court lacked personal jurisdiction over the defendant, is granted to the extent that the matter shall be set down for a hearing with respect to: (1) the propriety of the plaintiff's service in that action; and, if necessary (2) the extent and nature of the defendant,'s contacts, if any, within the State of New Jersey. It is well settled that "New York Courts will not enforce a judgment of a sister State where it is shown that the State in which the judgment was entered did not have jurisdiction over the defendant" (City Fed. Sav. Bank v Reckmeyer, 178 AD2d 503 see, State of Oklahoma v LNP. Realty Corp., 275 AD2d 773; Dominican Sisters of Ontario, Inc. v Dunn, 272 AD2d 367; David Newman & Assocs., P.C. v Natoli, 250 AD2d 723 see also, JDC Finance Co. I, L.P. v Patton, 727 NYS2d 71; Augusta Lumber SC Supply, Inc. v Herbert H. Sabbeth Corp.-, 101 AD2d 846). The relevant inquiry is two-pronged, requiring analysis of whether a sister state's long arm statute has been satisfied and whether the exercise of jurisdiction "comports with principles of due process under Federal constitutional law" (City Fed. Sav. Bank v Reckmeyer, supra; David Newman & Assocs., P.C. v Natoli, supra). Here, Mr. Spennato has asserted that the defendant neither employed the individual with whom the third party complaint was left, nor owned or operated any place of business at the Westbury address where service was attempted. Mr. Spanneto has further asserted that the defendant has engaged in no business in New Jersey and maintained no contacts with that State. Although the plaintiff has disputed the defendant's jurisdictional contentions, the matter cannot be resolved upon the conflicting submissions presented by the parties (cf. Friedman v Ramlal, supra; Thornapple Associates, Inc. v Tartaglia, _Misc2d_, [NYLJ April 21, 1997, p 32 co1 41). Accordingly, the matter shall be set down for a hearing to determine whether service was properly made upon the defendant (Simpson v Ma1 Ser. Corp., 205 AD2d 419, 420), and if so, whether the defendant maintained contacts with the State of New Jersey sufficient to warrant that State's exercise of in personam jurisdiction. at Said hearing shall take place before the undersigned Justice IAS Part 17 on October 29, 2001, at 9:30 a.m. Movant shall serve a copy of this order, with notice of entry upon the attorneys for plaintiff and upon the Sheriff of Nassau County, within ten days of the date of this order.
5 -5- Index 2001, The stay contained in the order to show cause dated July 9, shall continue pending the herein ordered hearing. Dated: OCT J.S.C.. slender.sept
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