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GREAT SENECA FINANCIAL CORP., Plaintiff(s), v. Suzanne M. WILSON, Desiree L. Wilson, Defendant(s).
The following papers have been considered by the Court on this motion submitted June 5, 2019
Order to Show Cause w/ annexed supporting papers 1
Affirmation in Opposition w/ annexed supporting papers 3
Reply Affidavit w/ annexed supporting papers 4
Plaintiff commenced this action on or about October 15, 2003, to recover monies allegedly owed by Suzanne M. Wilson and her daughter Desiree L. Wilson, pursuant to a credit card agreement with plaintiff's predecessor in interest, Chase Manhattan Bank. On or about February 10, 2004, plaintiff was awarded a default judgment against defendant Suzanne M. Wilson (hereinafter referred to as “defendant”), in the amount of $17, 391.34, and the action was severed and continued as to Desiree L. Wilson. Years later plaintiff recovered $905.80, pursuant to an income execution against defendant's salary.
Defendant now moves by order to show cause dated March 29, 2019 [Muscarella, J.] for an order: 1) vacating the default judgment against her, ostensibly pursuant to CPLR 5015(a)(4); 2) dismissing the action for lack of personal jurisdiction pursuant to CPLR 3211(a)(8), or in the alternative, setting the matter down for a Traverse hearing; 3) restraining and enjoining enforcement of the money judgment; and 4) directing plaintiff's attorney to place in escrow, any monies received as a result of a bank levy on Desiree L. Wilson's account until the matter is resolved.
Defendant's order to show cause is decided as follows.
Initially, this court will address defendant's request to place in escrow any monies received as a result of an alleged bank levy on Desiree L. Wilson's account. First, the court notes that defendant in her March 18, 2019 affidavit, and her attorney in his March 19, 2019 affirmation, both erroneously state that a money judgment was awarded against defendant and her daughter. As stated above, although Desiree L. Wilson was a named party in the original action, the action was severed as to her and a money judgment was only entered against defendant Suzanne M. Wilson. Additionally, there is no evidence presented to establish the existence of any bank levy, let alone an account belonging to Desiree L. Wilson but levied upon as a consequence of the judgment entered solely against defendant Suzanne M. Wilson. In view of same, this branch of defendant's application is denied without prejudice.
Nevertheless, and consistent with the provisions of CPLR § 3215(c), the apparent failure to pursue any default judgment as against Desiree L. Wilson for well over 15 years warrants formal dismissal of the action against her.
Turning to the remainder of defendant's order to show cause, CPLR § 5015(a)(4) provides that “[t]he court which rendered a judgment or order may relieve a party from it upon such terms as may be just, on motion of any interested person with such notice as the court may direct, upon the ground of lack of jurisdiction to render the judgment or order.”
“The plaintiff bears the ultimate burden of proving by a preponderance of the evidence that jurisdiction over the defendant was obtained by proper service of process” (Frankel v. Schilling, 149 AD2d 657, 659 [2d Dept 1989]; see also Banker Trust Company of California, N.A. v. Tsoukas, 303 AD2d 343 [2d Dept 2003]). A process server's affidavit constitutes prima facie evidence of proper service (see C & H Import & Export, Inc., v. MNA Global, Inc., 79 AD3d 784 [2d Dept 2010]; Roberts v. Anka, 45 AD3d 752 [2d Dept 2007]).
However, “[e]ven if a defendant eventually acquires actual notice of the lawsuit, actual notice alone will not sustain the service or subject a person to the court's jurisdiction when there has not been compliance with prescribed conditions of service” (Banker Trust Company of California, N.A. v. Tsoukas, 303 AD2d 343, 344 [2d Dept 2003]; Feinstein v. Bergner, 48 NY2d 234, 241 ).
In the case at bar, service was purportedly made upon the defendant pursuant to the “affix and mail” provisions of CPLR 308(4) following three attempts at her alleged residence at 5 East Ave, Glen Cove NY 11542-3916, to wit, Monday, September 22, 2003 at 8:23 AM.; Wednesday, September 24, 2003, at 6:10 PM; and Friday, September 26, 2003 at 4:31 PM. Affixation of the summons and complaint to the door took place immediately after the third attempt on September 26, 2003 with a copy mailed to the same address on September 29, 2003. There is an additional reference in the process server's affidavit of having spoken with a neighbor as follows: “ADDRESS CONFIRMED WITH NEIGHBOR MRS REED AT 3 EAST AVE” (Capitalization in the original) but nothing with regard to any attempt to ascertain a place of business for the defendant.
Pursuant to CPLR 308(4), service of process may be made by affixing the summons to the door of either the actual place of business, dwelling place or usual place of abode only where the alternate methods of personal service provided for in CPLR 308 (1) or (2) cannot be made with due diligence. The requirement of due diligence must be strictly observed because there is a reduced likelihood that a defendant will actually receive the summons when it is served pursuant to CPLR 308 (4). What constitutes due diligence is determined on a case-by-case basis, focusing not on the quantity of the attempts at personal delivery, but on their quality.
* * *
For the purpose of satisfying the due diligence requirement of CPLR 308 (4), it must be shown that the process server made genuine inquiries about the defendant's whereabouts and place of employment. (Serraro v. Staropoli, 94 AD3d 1083, 1084 - 1085 [2nd Dept 2012] (citations and quotation marks omitted)).
In County of Nassau v. Long, 35 AD3d 787 [2d Dept 2006] in which three weekday attempts were made between the hours of 3:45 PM and 7:44 PM it was held that the “due diligence” standard was not met since “[t]hese attempts were made on weekdays during hours when it reasonably could have been expected that [defendant] was either working or in transit to or from work (citations omitted)”.
In Gurevich v. Goodman, 269 AD2d 355 , the Appellate Division, Second Dept found that “only three attempts to personally serve the [defendant] at his home ․ on [Saturday] February 14, 1998, at 3:39 PM, [Wednesday] February 17, 1998, at 7:22 AM, and [Thursday] February 18, 1998, at 8:34 PM ․” was “defective as a matter of law” without the need for a hearing since “[t]he affidavit of the plaintiff's process server, together with the papers submitted in opposition to the appellant's motion, failed to demonstrate that the process server attempted to ascertain the appellant's business address and to effectuate personal service at that location ․”.
Plaintiff's three weekday attempts to serve the plaintiff all within an hour and ten (10) minutes of the traditional 9:00 AM - 5:00 PM workday are wholly indistinguishable from those of County of Nassau v. Long, supra. Moreover, a single mid-evening attempt at service (which did not even occur here as 6:10 PM is early evening) was found insufficient as a matter of law in Gurevich v. Goodman, supra, notwithstanding that in Gurevitch one of the three service attempts was made on a Saturday. No such Saturday service attempt took place here (compare County of Nassau v. Gallagher, 43 AD3d 972 [2d Dept 2007]).
Therefore, absent more, at the time the plaintiff obtained its clerk's judgment against the defendant the plaintiff had failed to obtain jurisdiction over her such that the clerk erred in granting said default judgment as a matter of law.1
In opposition, plaintiff argues that, by waiting fifteen (15) years after the judgment was rendered and ten (10) years after her wages were garnished to move to vacate the judgment, defendant waived her defense of lack of personal jurisdiction and is now estopped from challenging service. In support thereof plaintiff provides documentary evidence from the Nassau County Sheriff Enforcement Division that from October 25, 2010 through April 16, 2011 $905.80 2 was collected through garnishment of defendant's employment income from Rite Aid (Plaintiff's Exhibit E).
The cases cited by plaintiff in support of its contention that the defendant effectively waived her right to challenge jurisdiction, however, do not conclusively establish the applicability of the waiver doctrine under the circumstances of this case.
For example, in Ford Motor Credit Company v. Hooker, 62 Misc 3d 129(A) [App Term, 2d 2018], after a default judgment was rendered and wages were garnished, defendant sent a letter to the plaintiff disputing the debt. Thereafter, defendant did not move to vacate the judgment until nearly three (3) years later after the Sheriff delivered a second income execution to his employer. Finding that “[d]efendant's delay evidenced a willingness to accede to the terms of the judgment [citations omitted]” the defendant was found to have waived his jurisdictional defense.
Similarly, in Chase Bank USA, NA v. Schwartz, 61 Misc 3d 137[A] [App Term, 2d Dept, 11th & 12th Jud Dists 2018]) wherein the defendant's jurisdictional challenge was found to have been waived “ ‘by making payments pursuant to a judgment or wage garnishment for a substantial period of time’ (Cadlerock Joint Venture, L.P. v. Kierstedt, 119 AD3d 627, 628  [citations omitted])” the court found that documentary evidence submitted by the plaintiff established that defendant knew his bank account had been levied upon seven (7) years before defendant moved for vacatur.
Here, unlike the circumstances in Ford Motor Credit Company, supra, Chase Bank USA, NA, supra, and the cases cited therein, a factual dispute exists as to whether defendant knew or should have known that there existed a judgment against her and that collection efforts had been pursued with a least partial success. As explained in HSBC Bank USA v. A & R Trucking Company, Inc., 66 AD3d 606, 607 [1st Dept 2009] in cases where a defendant's delay and/or payment on a judgment has been found to constitute waiver of that defendant's right to challenge jurisdiction “defendants in those cases explicitly or implicitly participated in the action, thus acknowledging the validity of the judgment, or demonstrated a lack of good faith or delay in asserting [her] rights” (Accord Palisades Collection, LLC v. Estepan, 39 Misc 3d 150[A][App Term, 1st Dept 2013]; see also Cadlerock Joint Venture, L.P. v. Kierstedt, supra).
Notably, defendant claims that she was unaware of both the judgment against her and the wage garnishments until she received a telephone call from her daughter on March 22, 2019 (Affidavit of Suzanne M. Wilson dated June 1, 2019 at ¶ 4). Promptly thereafter, on March 29, 2019, defendant brought this order to show cause seeking to vacate the judgment. Furthermore, defendant explains that she had never been notified of the income execution and first learned of it as part of defendant's opposition to her motion. She states that after learning from her attorney about the alleged income execution she contacted the Human Resources Department of her former employer, Rite Aid, whereby she first learned that the payroll marking “CRTL” referred to an income execution but that she simply assumed that said cryptic deduction was another typical payroll deduction (Id., at ¶ 6).
In view of the foregoing, an evidentiary hearing is warranted to determine whether the existence of the judgment 3 and/or the Rite Aid wage garnishment 4 establishes defendant's explicit or implicit participation in the action, such that she acknowledged the validity of the judgment, or demonstrated a lack of good faith or delay in bringing this jurisdictional challenge years later (see HSBC Bank USA v. A & R Trucking Company, Inc., supra).
Said framed issue hearing shall be held at the First District Court, Civil Term, Part 3, Room 259, 99 Main Street, Hempstead, New York on October 2, 2019 at 2:30 p.m.
Consistent with the foregoing, if it is found that the defendant never waived her jurisdictional challenge, the judgment will be vacated as a nullity pursuant to CPLR 5015(a) (4) and the action dismissed in its entirety (see Prudence v. Wright, 94 AD3d 1073 [2d Dept 2012]; Falvo v. Cerra, 127 AD3d 919 [2d Dept 2015]). Further, all restraints and executions will be lifted and plaintiff directed to provide restitution of any monies collected from defendant on the judgment (see CPLR §§ 5515(d) and 5523; 275 Linden Realty Corp. v. Caraballa, 5 Misc 3d 32, 34 [App Term 2d Dept 2004]).
However, if the defendant is found to have waived her jurisdictional challenge, the judgment against her will stand.
This constitutes the decision and order of the court.
1. Having so found the court need not consider the defendant's additional claim that she did not reside at 5 East Ave, Glen Cove, NY 11542-3916 at the time she was allegedly served.
2. The $905.80 includes $43.13 in poundage on the principal amount of $862.67
3. While this court did not need to address the defendant's allegation that she did not live at 5 East Drive, Glen Cove, NY when service was purportedly made in 2003, her residence address may become relevant regarding any mailed notices to her.
4. While plaintiff's Exhibit E references collection from Rite Aid between 10/25/10 through 4/16/11, defendant's June 1, 2019 affidavit regarding alleged deductions marked “CTRL” by Rite Aid is claimed to span the much earlier period from 3/21/09 through 8/22/09. Neither party has produced any payroll or paycheck records from Rite Aid to explain this discrepancy.
Ignatius L. Muscarella, J.
Response sent, thank you
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Docket No: CV-026139-03
Decided: August 15, 2019
Court: District Court, New York,
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