NGH ASSOCIATES LTD v. UNITED PARCEL SERVICE INC (2007)

Defendants move to dismiss Plaintiff's causes of action for failure to state a cause of action.

BACKGROUND

This is an action against a package delivery service for negligence and breach of contract.

Plaintiff, NGH Associates, Ltd. (“NGH”) is a corporate security consulting firm which is located in Roslyn Heights.   NGH also conducts investigations and provides litigation support.¹  On November 30, 2006, NGH entrusted a package to Defendant United Parcel Service, Inc. (“UPS”) for overnight delivery to an attorney located in Garden City. The package contained “sensitive materials” which were to be reviewed by the attorney before being transmitted to the attorney's client.

The parties do not disclose the manner in which the package was transferred to UPS. However, for purposes of this motion, the Court will assume that it was placed in a UPS “drop box” by an NGH employee.   Although a tracking number was assigned to the package, it is unclear whether any type of receipt or bill of lading was issued.²  In any event, shortly after receiving the package, UPS sent NGH a “damage/loss notification,” stating that the parcel had been found empty and the carton discarded.

NGH alleges that UPS subsequently recovered a portion of the materials and delivered them not to the attorney but to the client.   NGH claims that the misdelivery of the package resulted in damage to both its reputation and its business.³

 On May 11, 2007, Plaintiff served a summons with notice upon UPS apparently by delivering it to the Secretary of State.⁴  The summons with notice states that the nature of the action is for breach of contract, gross negligence and damage to the business reputation of the Plaintiff.  CPLR 305(b).  The summons with notice does not state the sum of money for which judgment may be taken in case of default.   However, this is a waivable defect.  Sirkis v. Cohen, 23 A.D.3d 369, 805 N.Y.S.2d 550 (2nd Dept.2005).

UPS moves to dismiss Plaintiff's claim for failure to state a cause of action.   Defendant asserts that Plaintiff's claim is preempted by the Federal Aviation Authorization Act which prohibits the states from enforcing any law or regulation related to a “price, route, or service” of a motor carrier or freight forwarder. 49 U.S.C. § 14501(c)(1).

In opposition, Plaintiff argues that Defendant's pre-answer motion to dismiss is “premature,” and that Defendants' proper remedy is to demand a complaint pursuant to CPLR 3012.   Alternatively, Plaintiff argues that its claim is not preempted by federal law.

DISCUSSION

 NGH commenced this action by serving a summons with notice.   CPLR 3012(b) provides that when an action is commenced by service of a summons without a complaint, the Defendant can serve a notice of appearance with a demand for a complaint within the time provided for in CPLR 320(a).   If the Defendant serves a notice of appearance without a demand for a complaint, the complaint shall be served within 20 days after the service of the notice of appearance.   The only statutorily permitted response to the service of a summons with notice is the service of a notice of appearance with or without a demand for a complaint.   See, Siegel, New York Practice 4th § 60.

CPLR 3211(a)(7) permits the court to dismiss “․ one or more causes of action ․” alleged against a party “․ on the grounds that ․ (7) the pleading fails to state a cause of action.”  (Emphasis added.)

CPLR 3011 sets forth the types of pleading permitted in New York practice.   5-30 New York Civil Practice:  CPLR 3011.00. Pleadings include a complaint, an answer and a reply.  Id. The remainder of CPLR 3011 provides what may be plead in an answer and what is the appropriate responsive pleading.⁵

Since a summons with notice is not a pleading, one cannot move pursuant to CPLR 3211(a) to dismiss an action when it is commenced by service of a summons with notice.

 In determining a motion to dismiss made pursuant to CPLR 3211(a)(7), the court must determine whether the pleader has a cognizable cause of action.  Guggenheimer v. Ginzburg, 43 N.Y.2d 268, 401 N.Y.S.2d 182, 372 N.E.2d 17 (1977);  Rovello v. Orofino Realty Co., 40 N.Y.2d 633, 389 N.Y.S.2d 314, 357 N.E.2d 970 (1976);  Well v. Yeshiva Rambam, 300 A.D.2d 580, 753 N.Y.S.2d 512 (2nd Dept.2002);  and Frank v. DaimlerChrysler Corp., 292 A.D.2d 118, 741 N.Y.S.2d 9 (1st Dept.2002).   The court must read the complaint and determine from the four corners of the document whether the factual allegations set forth any cognizable cause of action.  Klepetko v. Reisman, 41 A.D.3d 551, 839 N.Y.S.2d 101 (2nd Dept.2007).   In making such a determination, the court must also accept as true all of the facts alleged in the complaint and any factual submissions made in opposition to the motion.   511 West 232nd Owners Corp. v. Jennifer Realty Co., 98 N.Y.2d 144, 746 N.Y.S.2d 131, 773 N.E.2d 496 (2002);  and Sokoloff v. Harriman Estates Development Corp., 96 N.Y.2d 409, 729 N.Y.S.2d 425, 754 N.E.2d 184 (2001);  and Alsol Enterprises, Ltd. v. Premier Lincoln-Mercury, Inc., 11 A.D.3d 493, 783 N.Y.S.2d 59 (2nd Dept.2004).   The complaint must be liberally construed and the Plaintiff must be given the benefit of every favorable inference.  Leon v. Martinez, 84 N.Y.2d 83, 614 N.Y.S.2d 972, 638 N.E.2d 511 (1994);  Goldfine v. Sichenzia, 43 A.D.3d 1108, 841 N.Y.S.2d 789 (2nd Dept.2007);  and Paterno v. CYC, LLC, 8 A.D.3d 544, 778 N.Y.S.2d 700 (2nd Dept.2004)

Since complaint has not yet been served, the court has no factual allegation to review so as to permit it to determine whether Plaintiff has any cognizable causes of action.   Stated more directly, the motion is premature.

Accordingly, it is,

ORDERED, that Defendants' motion to dismiss is denied without prejudice;  and it is further,

ORDERED, that Plaintiff is directed to serve a complaint within 20 days of the date of this order.

This constitutes the decision and order of this Court.

FOOTNOTES

1.   See NGH's website at www.​nghassociates.​com.

2.   The tracking number for the package was 1Z5T2T920190719703.

3.   The Court notes that a lawyer is under a duty to keep a client reasonably informed as to the status of a matter (EC 9-2).   While a lawyer may be justified in delaying transmission of information to which the client may react imprudently, a lawyer may not withhold information to serve the lawyer's own interest or convenience (ABA Rule of Prof. Conduct 1.4 and comment).   For the purpose of this motion to dismiss, the court will assume that misdelivery of the package caused professional embarrassment to the attorney, but the attorney did not intend to hide information from the client or otherwise violate a disciplinary rule.

4.   See Plaintiff's Ex. 5. Upon Defendants' representation that the only Defendant which is actually involved in the business of delivering packages is United Parcel Service, Inc., the action is deemed dismissed as to the other Defendants.

5.   An answer may contain a counterclaim against the Plaintiff or a cross-claim against another Defendant.   The Plaintiff must serve a reply to a counterclaim.   A cross-claim is deemed denied unless the party serving the answer specifically demands an answer to the counterclaim.

LEONARD B. AUSTIN, J.