CUSUMANO v. Northwoods Abstract, Ltd., Defendant-Appellant. (2020)

Order, Supreme Court, New York County (W. Franc Perry, J.), entered May 9, 2018, which granted plaintiff's motion to confirm the report and recommendation of the Special Referee finding, after a traverse hearing, that service of process commencing the action was properly made, and denied defendant Northwoods Abstract Ltd.'s motions to reject the Special Referee's report and recommendation and to vacate the default judgment entered against it, unanimously affirmed, without costs.

The summons with notice served on defendant met the requirements of CPLR 305(b) by stating that the action sought “to recover damages for contract damages and fraud” and that in the event of default a money judgment would be entered against defendant in the amount of $750,000 (see U.S. Bank N.A. v. GreenPoint Mtge. Funding, Inc., 147 A.D.3d 79, 88, 45 N.Y.S.3d 11 [1st Dept. 2016], appeal withdrawn 32 N.Y.3d 1123, 93 N.Y.S.3d 261, 117 N.E.3d 820 [2018]; see also Rowell v. Gould, Inc., 124 A.D.2d 995, 996, 508 N.Y.S.2d 794 [4th Dept. 1986]).

Defendant's argument that the summons is unclear as to whether the claims are asserted by one or both plaintiffs is unaccompanied by an explanation of the obstacle this presents to its preparing a defense, and is therefore unavailing.  Also unavailing is defendant's argument that the transcript of the inquest throws the nature of plaintiffs' claims into confusion.  The very brief discussion of the nature of the issues reflected in the transcript does not conflict with the statement in the summons with notice of the nature of the action and the relief sought.

Defendant is correct that non-attorney plaintiff Cusumano's appearance on behalf of plaintiff Soares (his significant other) as well as himself could be construed as the unauthorized practice of law (see e.g. People ex rel. Field v. Cronshaw, 138 A.D.2d 765, 526 N.Y.S.2d 579 [2d Dept. 1988], appeal dismissed 72 N.Y.2d 872, 532 N.Y.S.2d 364, 528 N.E.2d 516 [1988]; Blunt v. Northern Oneida County Landfill [NOCO], 145 A.D.2d 913, 914, 536 N.Y.S.2d 295 [4th Dept. 1988]).  However, defendant failed to establish that this is a basis for disturbing the order on appeal, since, as defendant notes, the only action Cusumano took in the guise of acting as Soares's attorney was to sign the summons with notice; thereafter, he and Soares retained counsel.

Defendant failed to demonstrate a reasonable excuse for its default (see CPLR 5015[a][1]).  Even assuming a misunderstanding between counsel and defendant's president Agruso as to who was handling the litigation, Agruso's failure to follow up with counsel in any respect, or to ensure that counsel received the email he claims to have sent in 2014 (of which there is no proof in the record) informing him that the insurer had declined to take the case, is not reasonable.  Nor is defendant's failure to appear at the inquest reasonable.  Although plaintiffs' counsel would not agree to an adjournment, defendant could have requested relief from the court, rather than wait until the conclusion of proceedings to seek to undo them.

In the absence of a reasonable excuse for the default, we need not determine whether defendant demonstrated a meritorious defense (Galaxy Gen. Contr. Corp v. 2201 7th Ave. Realty LLC, 95 A.D.3d 789, 790, 945 N.Y.S.2d 298 [1st Dept. 2012]).  Were we to do so, we would find that defendant failed to demonstrate a meritorious defense.  Defendant argues that it lacked a contractual relationship with plaintiffs, and the record is unclear as to the scope of its obligations to plaintiffs.  However, defendant does not deny that it was retained to perform services by plaintiffs' counsel, that, at closing, plaintiffs paid it $22,282 and that, in keeping with its role as liaison between plaintiffs and the surveyor, it remitted $1,485 of that amount to the surveyor.

Defendant failed to demonstrate that the default judgment should be vacated on the grounds of fraud, misrepresentation, or other misconduct, pursuant to CPLR 5015(a)(3).

To the extent defendant's arguments for rejecting the Special Referee's report and recommendation are directed to the Special Referee's credibility findings, we defer to those findings (see Terrastone Audubon, L.P. v. Blair Ventures, LLC, 160 A.D.3d 526, 527–528, 74 N.Y.S.3d 541 [1st Dept. 2018]).

We have considered defendant's remaining arguments and find them unavailing.