IN RE: Jeffrey GOLDMAN (2007)

In a proceeding pursuant to CPLR article 52 to enforce a judgment, Charles Chapman and Chapman Apex appeal from an order of the Supreme Court, Nassau County (Phelan, J.), entered January 16, 2007, which denied, in effect, their motion to dismiss the proceeding.

ORDERED that the order is reversed, on the law and the facts, with costs, the motion to dismiss is granted, the petition is denied, and the proceeding is dismissed.

Charles Chapman is the sole officer, director, and shareholder of two construction companies:  Chapman Apex and Region Associates, Inc. (hereinafter Region).   In 2001 the petitioner, Jeffrey Goldman, obtained a judgment against Region in the total sum of $209,320, including interest.   Collection efforts were unsuccessful, and ultimately, the petitioner commenced this special proceeding to enforce the judgment by piercing the corporate veil of Region in order to hold Charles Chapman personally liable for Region's debt.   He also sought to find Chapman Apex liable for Region's debt under an alter-ego theory.   Chapman Apex, Region, and Charles Chapman contended, inter alia, that the petition should be dismissed because the petitioner could not make out a prima face case on its corporate veil piercing and alter ego claims.   We agree.

 One of the primary and completely legitimate purposes of incorporating is to limit or eliminate the personal liability of corporate principals (see Bartle v. Home Owners Co-op., 309 N.Y. 103, 106, 127 N.E.2d 832).   Generally, a party seeking to pierce the corporate veil must establish that “(1) the owners exercised complete domination of the corporation in respect to the transaction attacked;  and (2) that such domination was used to commit a fraud or wrong against the plaintiff which resulted in the plaintiff's injury” (Matter of Morris v. New York State Dept. of Taxation & Fin., 82 N.Y.2d 135, 141, 603 N.Y.S.2d 807, 623 N.E.2d 1157;  see Old Republic Natl. Title Ins. Co. v. Moskowitz, 297 A.D.2d 724, 725, 747 N.Y.S.2d 556;  Hyland Meat Co. v. Tsagarakis, 202 A.D.2d 552, 552, 609 N.Y.S.2d 625). The mere claim that the corporation was completely dominated by the owners, or conclusory assertions that the corporation acted as their “alter ego,” without more, will not suffice to support the equitable relief of piercing the corporate veil (see Matter of Morris v. New York State Dept. of Taxation & Fin., 82 N.Y.2d at 141-142, 603 N.Y.S.2d 807, 623 N.E.2d 1157;  Damianos Realty Group, LLC v. Fracchia, 35 A.D.3d 344, 825 N.Y.S.2d 274).  “The decision whether to pierce the corporate veil in a given instance depends on the particular facts and circumstances” (Damianos Realty Group, LLC v. Fracchia, 35 A.D.3d at 344, 825 N.Y.S.2d 274).

 Here, although the petitioner submitted evidence tending to demonstrate that Charles Chapman exercised dominion and control over Region, the petitioner failed to establish, prima facie, that Charles Chapman used such dominion and control to commit a fraud or wrong against the petitioner which resulted in injury, or that he failed to observe corporate formalities.   There was also no evidence beyond the petitioner's conclusory assertions that Chapman Apex and Region were alter egos (see Mistrulli v. McFinnigan, Inc., 39 A.D.3d 606, 834 N.Y.S.2d 271;  Damianos Realty Group, LLC v. Fracchia, 35 A.D.3d at 344, 825 N.Y.S.2d 274;  John John, LLC v. Exit 63 Dev., LLC, 35 A.D.3d 540, 826 N.Y.S.2d 657;  Treeline Mineola, LLC v. Berg, 21 A.D.3d 1028, 801 N.Y.S.2d 407;  O'Brien-Kreitzberg & Assoc. v. K.P., Inc., 218 A.D.2d 519, 630 N.Y.S.2d 76).   Accordingly, the petition should have been denied and the proceeding dismissed.

In light of our determination, it is unnecessary to reach the appellants' remaining contentions.