CPLR R. 5015 – Page 2

5015 and 22 NYCRR 202.27

Diaz v Perlson, 2019 NY Slip Op 00194 [1st Dept. 2019]

“A motion to vacate a dismissal for failure to appear at a scheduled court conference (22 NYCRR 202.27) must be supported by a showing of reasonable excuse for the failure to attend the conference and a meritorious cause of action” (Biton v Turco, 88 AD3d 519, 519 [1st Dept 2011]). Even assuming that plaintiff set forth a reasonable excuse for the failure to appear at the conference, the court providently exercised its discretion in denying the motion since plaintiff failed to show a meritorious cause of action (see e.g. Barclay v Etim, 129 AD3d 591 [1st Dept 2015], lv dismissed 28 NY3d 948 [2016]).

Thomas v Karen’s Body Beautiful LLC, 2019 NY Slip Op 00241 [1st Dept. 2019]

We find that the motion court correctly determined that the affidavits constituted mere conclusory denials, which were insufficient to raise an issue of fact as to proper service. (Grinshpun v Borokhovich, 100 AD3d 551, 552 [1st Dept 2012], lv denied 21 NY3d 857 [2013]; Colebrooke Theat. LLP v Bibeau, 155 AD3d 581, 581 [1st Dept 2017], lv dismissed 31 NY3d 1137 [2018]; Reliable Abstract Co., LLC v 45 John Lofts, LLC, 152 AD3d 429, 429 [1st Dept 2017], lv dismissed 30 NY3d 1056 [2018]).

5015 “potentially meritorious”

Mid-Hudson Props., Inc. v Klein, 2018 NY Slip Op 08638 [2 Dept. 2018]

Although it was not necessary for Varble to establish the validity of his defense as a matter of law in order to obtain vacatur of his default (see Marinoff v Natty Realty Corp., 17 AD3d 412), he satisfied his burden of demonstrating a potentially meritorious defense based upon the absence of a personal guaranty (see Brown Bark II, L.P. v Weiss & Mahoney, Inc., 90 AD3d 963) as well as the dissolution of KVG, P.C., by operation of law upon Greco leaving the firm, and later being disbarred in March 2016 (see Partnership Law §§ 60, 62[3]; Magee v Magee, 120 AD3d 637; Mashihi v 166-25 Hillside Partners, 51 AD3d 738).

Inherent power to vacate

Nationstar Mtge., LLC v Russo, 2018 NY Slip Op 08668 [2d Dept. 2018]

“Under CPLR 5015(a), a court is empowered to vacate a default judgment [or order] for several reasons, including excusable neglect; newly-discovered evidence; fraud, misrepresentation or other misconduct by an adverse party; lack of jurisdiction; or upon the reversal, modification or vacatur of a prior order” (Woodson v Mendon Leasing Corp., 100 NY2d 62, 68; see CPLR 5015[a]; Wells Fargo Bank, N.A. v Choo, 159 AD3d 938, 938; HSBC Bank USA v Josephs-Byrd, 148 AD3d 788; 40 BP, LLC v Katatikarn, 147 AD3d 710). “However, CPLR 5015(a) does not provide an exhaustive list as to when a default judgment [or order] may be vacated, and a court may vacate its own judgment [or order] for sufficient reason and in the interests of substantial justice” (40 BP, LLC v Katatikarn, 147 AD3d at 711, citing Woodson v Mendon Leasing Corp., 100 NY2d at 68; see Wells Fargo Bank, N.A. v Choo, 159 AD3d at 938; Hudson City Sav. Bank v Cohen, 120 AD3d 1304, 1305).
Although the Supreme Court retains “inherent discretionary power to relieve a party from a judgment or order for sufficient reason and in the interest of substantial justice” (Galasso, Langione & Botter, LLP v Liotti, 81 AD3d 884, 885; see Ladd v Stevenson, 112 NY 325, 332; Katz v Marra, 74 AD3d 888, 890), “[a] court’s inherent power to exercise control over its judgment is not plenary, and should be resorted to only to relieve a party from judgments taken through [fraud], mistake, inadvertence, surprise or excusable neglect” (Matter of McKenna v County of Nassau, Off. of County Attorney, 61 NY2d 739, 742 [internal quotation marks omitted]; see Wells Fargo Bank Minn., N.A. v Coletta, 153 AD3d 757, 758; HSBC Bank USA v Josephs-Byrd, 148 AD3d at 790)

“strategy, not law office failure”

Soto v Chelsea W26, LLC, 2018 NY Slip Op 08170 [2d Dept. 2018]

The Supreme Court providently exercised its discretion in rejecting the plaintiff’s excuse of law office failure based on the disputed allegation that the per diem attorney hired by the plaintiff’s attorney did not appear on the return date. Regardless of whether the per diem attorney appeared on the return date, the evidence submitted by the plaintiff in support of his motion demonstrates that the plaintiff’s attorney made a conscious decision to send a per diem attorney on the motion’s return date to attempt to resolve the motion by stipulation rather than file and serve any papers in opposition. Plaintiff’s counsel’s decision not to oppose the motion constituted a strategy, not law office failure, and thus was not a reasonable excuse (see Hudson City Sav. Bank v Bomba, 149 AD3d 704, 705; Bank of N.Y. Mellon v Colucci, 138 AD3d 1047, 1048; White v Daimler Chrysler Corp., 44 AD3d 651, 652; Everything Yogurt v Toscano, 232 AD2d 604, 606).

An odd stipulation case

RCS Recovery Servs., LLC v Mensah, 2018 NY Slip Op 07766 [2d Dept. 2018]

We agree with the Supreme Court’s denial of that branch of the defendant’s motion which was pursuant to CPLR 5015(a)(3) to vacate the judgment. Absent any proof of intrinsic or extrinsic fraud in the procurement of the judgment, the defendant was not entitled to that relief (see LaSalle Bank N.A. v Oberstein, 146 AD3d 945, 945-946; Dunkin Donuts v HWT Assoc., 181 AD2d 713, 714; Central Funding Co. v Kimler, 54 AD2d 748, 748).

However, under the circumstances of this case, the Supreme Court should have granted the alternate branch of the defendant’s motion, which was, in effect, to preclude the plaintiff from enforcing the default provision of the stipulation without affording the defendant a reasonable opportunity to cure his default. “Under almost any given state of facts, where to enforce a stipulation would be unjust or inequitable or permit the other party to gain an unconscionable advantage, courts will afford relief” (Goldstein v Goldsmith, 243 App Div 268, 272; see Weitz v Murphy, 241 AD2d 547, 548; Bank of N.Y. v Forlini, 220 AD2d 377, 378).

Here, the defendant’s default was inadvertent and minor in nature when measured against the harsh result that would be obtained upon literal enforcement of the default provision in the stipulation (see Bank of N.Y. v Forlini, 220 AD2d at 378). Insofar as the plaintiff failed to offer the defendant any opportunity to cure his default before seeking to recover the full amount due under the judgment, the plaintiff’s conduct could be interpreted as an attempt to take advantage of a technical default to obtain payment of the far greater sum which the plaintiff had originally sought, but agreed to forgo as part of the settlement (compare Weitz v Murphy, 241 AD2d at 548-549 and Bank of N.Y. v Forlini, 220 AD2d at 378, with McKenzie v Vintage Hallmark, 302 AD2d 503, 504).

Compare IndyMac Bank, FSB v Izzo, 2018 NY Slip Op 08014 [2d Dept. 2018]

5015(a)(2)(3)

Kondaur Capital Corp. v Stewart, 2018 NY Slip Op 07713 [2d Dept. 2018]

The defendant failed to demonstrate her entitlement to relief based upon newly discovered evidence (see CPLR 5015[a][2]; Deutsche Bank Natl. Trust Co. v Morris, 160 AD3d 613; Wall St. Mtge. Bankers, Ltd. v Rodgers, 148 AD3d 1088, 1089). Notably, even if the evidence cited by the defendant could be considered newly discovered, she failed to establish that such evidence would probably have produced a different result (see Bank of N.Y. v Tobing, 155 AD3d 596, 596-597; U.S. Bank N.A. v Galloway, 150 AD3d 1174, 1175; IMC Mtge. Co. v Vetere, 142 AD3d 954, 955; Federated Conservationists of Westchester County v County of Westchester, 4 AD3d 326, 327).

Additionally, the defendant failed to demonstrate her entitlement to vacatur pursuant to CPLR 5015(a)(3). A party seeking to vacate a judgment pursuant to CPLR 5015(a)(3) must make the motion within a reasonable time. Here, the defendant’s delay in moving to vacate the judgment of foreclosure and sale was unreasonable (see Dimery v Ulster Sav. Bank, 82 AD3d 1034, 1034; Bank of N.Y. v Stradford, 55 AD3d 765, 765). In any event, the defendant failed to demonstrate any fraud, misrepresentation, or other misconduct warranting vacatur of the judgment (see Summitbridge Credit Invs., LLC v Wallace, 128 AD3d 676, 677-678).

The defendant contends that the Supreme Court lacked jurisdiction to issue the judgment of foreclosure and sale because Kondaur lacked standing. However, ” an alleged lack of standing is not a jurisdictional defect'” (HSBC Bank USA, N.A. v Dalessio, 137 AD3d 860, 863, quoting JP Morgan Mtge. Acquisition Corp. v Hayles, 113 AD3d 821, 823; see CPLR 5015[a][4]).

Successive vacate motions

Shannon v Ifemesia, 2018 NY Slip Op 07478 [2d Dept. 2018]

We also agree with the Supreme Court’s denial of the defendant’s second motion to vacate the default judgment and to dismiss the complaint. The defendant was precluded from making a second motion to vacate her default on the same ground raised in the prior motion (see Viva Dev. Corp. v United Humanitarian Relief Fund, 108 AD3d 619, 620; JMP Pizza, LLC v 34th St. Pizza, LLC, 104 AD3d 648).

Vacatur

2004 McDonald Ave. Corp. v KGYM Holdings Group, Inc., 2018 NY Slip Op 06508 [2d Dept. 2018]

CPLR 317 applies where a defendant was served by means other than personal delivery, did not receive notice of the action, and has a potentially meritorious defense (see Booso v Tausik Bros. LLC., 148 AD3d 1108). Here, the defendants claimed they were never served. Therefore, they sought to vacate the default judgment against them pursuant to CPLR 5015(a)(4) for lack of personal jurisdiction. On this point, the affidavit of service of a process server generally constitutes prima facie evidence of proper service (see US Bank N.A. v Ramos, 153 AD3d 882; Central Mtge. Co. v Ward, 127 AD3d 803). In this case, however, the process server submitted affidavits of exercising due diligence to attempt service, not affidavits of service.

If service is not made, the default judgment is a nullity (see Ariowitsch v Johnson, 114 AD2d 184). If a defendant is not served, “notice received by means other than those authorized by statute cannot serve to bring a defendant within the jurisdiction of the court” (Feinstein v Bergner, 48 NY2d 234, 241).

Sposito v Cutting, 2018 NY Slip Op 06782 [2d Dept. 2018]

“As a general rule, a defendant who seeks to vacate a default in appearing at a compliance conference is required to demonstrate both a reasonable excuse for the default and a potentially meritorious defense” (Foley Inc. v Metropolis Superstructures, Inc., 130 AD3d 680, 680; see Polsky v Simon, 145 AD3d 693). Here, the defendant demonstrated a reasonable excuse for his failure to appear at the compliance conference on November 29, 2016, including the fact that he had been hospitalized from mid-September to late October 2016 for injuries sustained in a fall. In addition, notice of the conference was sent to the subject property and, although the defendant’s grandson resided there, it was never the defendant’s residence and the defenedant denied any knowledge of the November 29, 2016, conference. The defendant also demonstrated that he did not receive notice of the adjourned conference date of January 24, 2017, and the record is devoid of any evidence demonstrating that such notice was, in fact, given to him. Under such circumstances, the defendant’s nonappearance for the conference on January 24, 2017, could not constitute a default, as there was no failure to perform a legal duty (see Notaro v Performance Team, 161 AD3d 1093; Foley Inc. v Metropolis Superstructures, Inc., 130 AD3d at 681). “This is analogous to the situation of a defendant who has not been served with process and suffers a default judgment. In both situations, the default’ is a nullity along with the remedy the court renders in response” (Pelaez v Westchester Med. Ctr., 15 AD3d 375, 376). As the defendant’s default in appearing at the conference on January 24, 2017, is considered a nullity, vacatur of that default ” is required as a matter of law and due process, and no showing of a potentially meritorious defense is required'” (Notaro v Performance Team, 161 AD3d at 1095, quoting Bonik v Tarrabocchia, 78 AD3d 630, 632; see Matter of 542 A Realty, LLC, 118 AD3d 993, 994; Pavlou v Associates Food Stores, Inc., 96 AD3d 919). Therefore, the Supreme Court should have vacated the default and the notice of inquest as a matter of law and due process, and no showing of a potentially meritorious defense was required.

In addition, the Supreme Court should have granted that branch of the defendant’s motion which was to vacate the note of issue and certificate of readiness. Since the defendant moved for such relief more than 20 days after service of the note of issue and certificate of readiness, he had to show good cause for vacatur (see 22 NYCRR 202.21[e]). “To satisfy the requirement of good cause,’ the party seeking vacatur must demonstrate that unusual or unanticipated circumstances developed subsequent to the filing of the note of issue and certificate of readiness requiring additional pretrial proceedings to prevent substantial prejudice'” (Ferraro v North Babylon Union Free School Dist., 69 AD3d 559, 561, quoting White v Mazella-White, 60 AD3d 1047, 1049 [internal quotation marks omitted]). Here, for the reasons set forth above, particularly that the defendant’s failure to appear at the conference on January 24, 2017, did not constitute a default and warranted vacatur of the default and the notice of inquest as a matter of law and due process, the defendant established good cause for vacating the note of issue and certificate of readiness.

Accordingly, the Supreme Court should have granted the defendant’s motion pursuant to CPLR 5015(a)(1) to, in effect, vacate his default in appearing for two scheduled court conferences

Rosario v Naranjo, 2018 NY Slip Op 06780 [2d Dept. 2018]

A defendant seeking to vacate a default in appearing or answering the complaint pursuant to CPLR 5015(a)(1) must demonstrate both a reasonable excuse for the default and a potentially meritorious defense to the action (see Eugene Di Lorenzo, Inc. v A. C. Dutton Lbr. Co., 67 NY2d 138, 141; Goldfarb v Zhukov, 145 AD3d 757, 758; Li Fen Li v Cannon Co., Inc., 155 AD3d 858, 859). “Whether there is a reasonable excuse for a default is a discretionary, sui generis determination to be made by the court based on all relevant factors, including the extent of the delay, whether there has been prejudice to the opposing party, whether there has been willfulness, and the strong public policy in favor of resolving cases on the merits” (Harcztark v Drive Variety, Inc., 21 AD3d 876, 876-877; see Gomez v Gomez-Trimarchi, 137 AD3d 972, 973).

A.G. Parker, Inc. v 246 Rochester Partners, LLC, 2018 NY Slip Op 06711 [2d Dept. 2018]

A party is precluded from moving to vacate its default on grounds asserted in a prior motion to vacate the default that had been previously denied in an order from which it took no appeal as well as on grounds that were apparent at the time that the party made the prior motion but were not asserted therein (see U.S. Bank N.A. v Davis, 161 AD3d 808; LaSalle Natl. Bank Assn. v Odato, 126 AD3d 675, 676; Eastern Sav. Bank, FSB v Brown, 112 AD3d 668, 670; Lambert v Schreiber, 95 AD3d 1282, 1283; Bianco v Dougherty, 54 AD2d 681).

Itshaik v Singh, 2018 NY Slip Op 06888 [2d Dept. 2018]

“When a defendant seeking to vacate a default judgment raises a jurisdictional objection pursuant to CPLR 5015(a)(4), the court is required to resolve the jurisdictional question before determining whether it is appropriate to grant a discretionary vacatur of the default under CPLR 5015(a)(1)” (Canelas v Flores, 112 AD3d 871, 871; see Community W. Bank, N.A. v Stephen, 127 AD3d 1008, 1009; HSBC Bank USA, N.A. v Miller, 121 AD3d 1044, 1045). A defendant moving to vacate a judgment entered upon his or her default in appearing or answering the complaint on the ground of lack of personal jurisdiction “is not required to demonstrate a reasonable excuse for the default and a potentially meritorious defense” (Prudence v Wright, 94 AD3d 1073, 1073; see Falvo v Cerra, 127 AD3d 919, 920). “[T]he failure to serve process in an action leaves the court without personal jurisdiction over the defendant, and all subsequent proceedings are thereby rendered null and void” (Krisilas v Mount Sinai Hosp., 63 AD3d 887, 889 [internal quotation marks omitted]).

Here, through his submissions, the defendant established that the Supreme Court did not acquire personal jurisdiction over him (see CPLR 5015[a][4]). The plaintiff contends that the defendant was estopped from challenging service upon him at the West End Avenue address pursuant to Vehicle and Traffic Law § 505(5), which requires that every motor vehicle licensee notify the Commissioner of the DMV of any change in residence within 10 days of the change and make a notation of such change of residence on the license. However, under the circumstances of this case, where the defendant did not provide the West End Avenue address at the time of the accident, where the record does not contain a DMV driver’s abstract for the defendant, and where the plaintiff identified the motor vehicle allegedly involved in this accident as belonging to a neighbor, the plaintiff’s contention is without merit (cf. Canelas v Flores, 112 AD3d at 871-872). Accordingly, we agree with the Supreme Court’s granting of the defendant’s motion to vacate the order dated July 11, 2016, and for leave to serve a late answer, based on lack of jurisdiction (see CPLR 5015[a][4]; Falvo v Cerra, 127 AD3d at 920).

In light of our determination of the jurisdictional issue, we need not reach the parties’ contentions regarding a discretionary vacatur pursuant to CPLR 5015(a)(1). Moreover, the parties’ contentions regarding CPLR 317, which were not raised before the Supreme Court, are not properly before this Court.

Fun with 5015

Torres v Rely On Us, Inc., 2018 NY Slip Op 06587 [2d Dept. 2018]

In addition, even after expiration of the one-year limitations period set forth in CPLR 5015, "a court may vacate its own judgment for sufficient reason and in the interests of substantial justice" (Woodson v Mendon Leasing Corp., 100 NY2d 62, 68; see U.S. Bank N.A. v Losner, 145 AD3d 935; Yung Chong Ho v Uppal, 130 AD3d at 812; Hudson City Sav. Bank v Cohen, 120 AD3d 1304; Wells Fargo Bank v Hodge, 92 AD3d 775).

Here, contrary to the plaintiffs' contention, that branch of ROU's motion which was pursuant to CPLR 5015(a)(1) was not untimely, since there is no evidence that the plaintiffs ever served ROU with written notice of entry of the order dated November 19, 2014 (see Capurso v Capurso, 134 AD3d 974, 975; Garcia v Pepe, 42 AD3d 427, 430). Accordingly, the one-year time period never commenced (see CPLR 5015[a][1]).

Nevertheless, we agree with the Supreme Court's determination to deny those branches of ROU's motion which were to vacate the order dated November 19, 2014, and to extend the time to serve an answer. While the court has the discretion to accept law office failure as a reasonable excuse (see CPLR 2005; Shin v ITCI, Inc., 115 AD3d 736, 737), "[a] party attributing his or her default to a former attorney must provide a detailed and credible explanation of the default. Conclusory and unsubstantiated allegations of law office failure are not sufficient" (U.S. Bank N.A. v Barr, 139 AD3d 937, 937-938 [citation and internal quotation marks omitted]; see LaSalle Bank, N.A. v LoRusso, 155 AD3d 706, 707; Morris v Metropolitan Transp. Auth., 191 AD2d 682). "[M]ere neglect is not a reasonable excuse" (Ki Tae Kim v Bishop, 156 AD3d 776, 777 [internal quotation marks omitted]).

Contrary to ROU's contention, it failed to provide a detailed and credible explanation of the default, and no other evidence was submitted to corroborate the allegation of law office failure (see OneWest Bank, FSB v Singer, 153 AD3d 714, 716). Accordingly, ROU's "bare allegations of incompetence on the part of prior counsel" (Huggins v Parkset Supply, Ltd., 24 AD3d 610, 611 [internal quotation marks omitted]) were insufficient to establish an excusable default under CPLR 5015(a)(1) (see LaSalle Bank, N.A. v LoRusso, 155 AD3d 706; LaSalle Bank N.A. v Calle, 153 AD3d 801; Carillon Nursing & Rehabilitation Ctr., LLP v Fox, 118 AD3d 933, 934; Beale v Yepes, 309 AD2d 886).

Since ROU failed to establish a reasonable excuse for its default in appearing or answering the complaint, it is unnecessary to consider whether it established the existence of a potentially meritorious defense (see CPLR 5015[a][1]; LaSalle Bank N.A. v Calle, 153 AD3d at 803).

Furthermore, the interests of substantial justice did not warrant vacating ROU's default in the exercise of the Supreme Court's inherent power (see Yung Chong Ho v Uppal, 130 AD3d at 813).

The bold is mine.

5015

U.S. Bank N.A. v Davis, 2018 NY Slip Op 03166 [2nd Dept. 2018]

A party is precluded from moving to vacate his or her default on grounds asserted in a prior motion to vacate the default that, as here, had been previously denied in an order from which that party took no appeal, or on grounds that were apparent at the time that the party made the prior motion but were not asserted therein (see LaSalle Natl. Bank Assn. v Odato, 126 AD3d 675, 676; Eastern Sav. Bank, FSB v Brown, 112 AD3d 668, 670; Viva Dev. Corp. v United Humanitarian Relief Fund, 108 AD3d 619, 620; JMP Pizza, LLC v 34th St. Pizza, LLC, 104 AD3d 648; Lambert v Schreiber, 95 AD3d 1282, 1283). Accordingly, contrary to the defendants' contention, their cross motion to vacate their default in opposing the plaintiff's prior motion for summary judgment and to dismiss the complaint insofar as asserted against them was properly denied.