Opinion
600849/09
06-24-2010
Alfred E. Mann Living Trust, Plaintiff, v. ETIRC Aviation S.a.r.L and ROLAND ("ROEL") PIEPER, Defendants.
Jeffrey S. Boxer and Leonardo Trivigno of Carter Ledyard & Milburn LLP for defendant Piper B. Ted Howes and Audrey Lu of McDermott Will & Emery LLP for Plaintiff.
Jeffrey S. Boxer and Leonardo Trivigno of Carter Ledyard & Milburn LLP for defendant Piper B. Ted Howes and Audrey Lu of McDermott Will & Emery LLP for Plaintiff. Eileen Bransten, J.
Defendant Roland ("Roel") Pieper moves pursuant to CPLR 2304 to quash a post-judgment subpoena duces tecum (the "Subpoena") dated September 18, 2009 issued to Pieper by plaintiff Alfred E. Mann Living Trust (the "Mann Living Trust"). BACKGROUND
On March 19, 2009, the Mann Living Trust commenced this action by filing a summons and motion for summary judgment in lieu of complaint seeking to recover under a promissory note and guaranty (the "Guaranty") executed by ETIRC Aviation S.a.r.L ("ETIRC") and Pieper, respectively (Affirmation of Jeffrey S. Boxer in Support of Defendant's Application to Quash Subpoena or for a Protective Order ["Boxer Aff"] at ¶ 2).
On April 17, 2009, Pieper cross-moved to dismiss the action for improper service (Boxer Aff at ¶ 3).
The Mann Living Trust and ETIRC had entered into a financial arrangement whereby ETIRC executed a promissory note agreeing to repay the Mann Living Trust. Pieper executed the Guaranty guaranteeing payment of the promissory note.
The Guaranty includes provisions regarding personal service and jurisdiction, reciting in relevant part that:
"(a) [Pieper] HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN [Pieper] AND LENDER PERTAINING TO THIS GUARANTY . . . [Pieper] EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND [Pieper]
HEREBY WAIVES ANY OBJECTION THAT IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. [Pieper] HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUES IN ANY SUCH ACTION OR SUIT" (Affidavit of Alfred E. Mann in Support of Plaintiff's Motion for Summary Judgment in Lieu of Complaint ["Mann Aff"], Ex D at § 2.1 [titled "Submission to Jurisdiction; Waiver of Jury Trial"]).
By a decision and order dated June 19, 2009 (the "June 19 Order"), this Court granted the Mann Living Trust's motion for summary judgment in lieu of complaint as against Pieper and denied defendants' cross-motion to dismiss (Boxer Aff at ¶ 4; Affirmation of B. Ted Howes, Esq. in Support of Plaintiff's Opposition to Defendant's Application to Quash Subpoena or for a Protective Order ["Howes Aff"] at ¶ 2). This Court stated that "[i]t could not be clearer that [Pieper] waived his right to personal service of the process at issue in this action. Service by email, moreover, was undoubtedly reasonable as the [underlying agreement] and Guaranty contemplated delivery of notices related to the transactions by email" (June 19 Order at 3).
On September 18, 2009, the Mann Living Trust served the Subpoena on Pieper directing that he produce certain documents and appear for a deposition concerning the nature and whereabouts of his income, property and other assets (Howes Aff at ¶ 4).
The Mann Living Trust served the Subpoena on Pieper at an e-mail address provided by Pieper in the parties' underlying contract (Howes Aff at ¶ 5). The Mann Living Trust also served a separate copy of the Subpoena by hand delivery and e-mail upon the law firm of Carter Ledyard & Millburn LLP ("Carter Ledyard"), the New York counsel who have represented and who continue to represent Pieper in this action (Howes Aff at ¶ 6).
Pieper now moves to quash the Subpoena. ANALYSIS
Pieper argues that the Subpoena should be quashed because an individual who resides outside of New York and who was not served with a subpoena in New York cannot be compelled to produce documents or give testimony in New York. Pieper also contends that delivery of a subpoena to a lawyer is similarly ineffective if the lawyer's representation of the subpoenaed individual is limited.
I. Service on the defendant
The Mann Living Trust served Pieper via e-mail. Pieper contends that because he resides outside of New York and was not served with the Subpoena in New York, the Subpoena must be quashed.
The Mann Living Trust also purportedly served Pieper via FedEx to an address in the Netherlands — an address at which Pieper's counsel asserts that he does not reside (Memorandum of Law in Support of Defendant's Application to Quash Subpoena or for a Protective Order ["Mem in Supp"] at 2). However, the Mann Living Trust's principal basis for proper service is service via e-mail (see Howes Aff at ¶ 5; Plaintiff's Memorandum of Law in Opposition to Defendant's Application to Quash Subpoena or for a Protective Order ["Mem in Opp"] at 2).
A subpoena served upon a defendant outside the State of New York is void (see Coutts Bank (Switz.) v Anatian, 275 AD2d 609, 611 [1st Dept 2000] [Sullivan, P. J., concurring] [hereinafter "Coutts Bank"]; Intervest Nat'l Bank v Klein, 26 Misc 3d 1203[A], 2009 NY Slip Op 52652[U], *3 [Sup Ct, NY County 2009] ["a New York subpoena may not be served outside the state"], quoting Siegel, NY Prac § 383, at 650 [4th ed]).
The Mann Living Trust maintains that because this Court already has an independent jurisdictional basis over Pieper, he may not avoid compliance with the Subpoena because it was served outside the State of New York (Mem in Opp at 4, citing Coutts Bank, 275 AD2d at 611; Cherfas v Wolf, 20 Misc 3d 1118[A], 2008 NY Slip Op 51397[U], at *4 [Sup Ct, Kings County 2008]; 23/23 Communs. Corp. v GMC, 172 Misc 2d 821, 824-25 [Sup Ct, NY County 1997]).
Pieper rejoins that the cases cited by the Mann Living Trust are inapposite.
As Pieper correctly contends, in cases where the judgment creditor sought to compel the deposition of a judgment debtor located out of the State, courts have held that the subpoenas were void (see e.g. Aquavella v Equivision, Inc., 181 Misc 2d 322, 324 [Sup Ct, Monroe County 1999]; Israel Discount Bank, Ltd. v P. S. Products Corp., 65 Misc 2d 1002, 1004 [Sup Ct, NY County 1991] ["service of the subpoena upon judgment debtor without the State is void"]).
In both Aquavella and Israel Discount Bank, Ltd., a judgment creditor sought to compel the deposition of a judgment debtor. In each case, the court denied a motion to compel the judgment debtor's appearance at a deposition because under NY Judiciary Law § 2-b(1) the court was only authorized to serve subpoenas that required appearances at depositions to individuals found within the State (see e.g. Aquavella, 181 Misc 2d at 324; Israel Discount Bank, Ltd., 65 Misc 2d at 1004).
Pieper maintains that the same result in Aquavella and Israel Discount Bank, Ltd. should obtain here because he was not located in the State of New York and, therefore, the Subpoena was not properly served.
This Court finds that, under the circumstances of this case, Aquavella and Israel Discount Bank, Ltd. do not apply because they do not involve a contractual waiver to personal jurisdiction, as does this case.
"Two (2) components must be satisfied for a court to have personal jurisdiction over a person: first, service of process must be properly effectuated and second, the court must have power to reach the party in order to enforce its judicial decrees" (Cherfas, 2008 NY Slip Op 51397[U], at *2 [citations omitted]).
New York Judiciary Law § 2-b, which provides that "[a] court of record has power to issue a subpoena requiring the attendance of a person found in the state to testify in a cause pending in that court," authorizes a court to reach a party in this State.
"Service of process, no matter how flawlessly executed, cannot by itself vest a court with jurisdiction over a non-domiciliary of New York state" (Cherfas, 2008 NY Slip Op 51397[U], at *2). Service of a subpoena outside this State have been held void because courts have reasoned that such service is not expressly authorized (cf. Wiseman v American Motors Sales Corp., 103 AD2d 230, 234 [2d Dept 1984]; see e.g. Aquavella, 181 Misc 2d at 324; Israel Discount Bank, Ltd., 65 Misc 2d at 1004).
However, "regardless of their state of domicile, there are several ways that a party may consent to a court's exercise of personal jurisdiction in a specific matter where that court would not otherwise have had jurisdiction" (Cherfas, 2008 NY Slip Op 51397[U], at *2). "Where a party consents to a court's jurisdiction it is a complete waiver of a defense based on invalid jurisdiction by that party later in the litigation" (id. at *3).
Through the waiver of personal jurisdiction in the Guaranty, Pieper authorized personal service without the State and consented to this Court's exercise of personal jurisdiction by agreeing to "submit[] and consent[] in advance to such jurisdiction [in New York] in any action or suit commenced in any such court," . . . "waive[] any objection that [he] may have based upon lack of personal jurisdiction" and "waive[] personal service of the summons, complaint and other process issues in any such action or suit" (Mann Aff, Ex D at § 2.1; see Cherfas, 2008 NY Slip Op 51397[U], at *3). Accordingly, Pieper's motion to quash based on improper service is denied.
II. Service on defendant's counsel
Pieper also maintains that service of the Subpoena on Carter Ledyard in New York is insufficient service.
The Mann Living Trust responds that service of the Subpoena on Pieper was proper because Carter Ledyard was served inside the State of New York.
Pieper urges that service on counsel is permissible "only in unique circumstances where the lawyer is actively and integrally engaged in ongoing representation of the judgment-debtor on the merits" (Reply Memorandum of Law in Support of Defendant Roel Pieper's Application to Quash Subpoena or for a Protective Order ["Reply"] at 7). Pieper further argues that Carter Ledyard only appeared in a limited capacity to contest personal jurisdiction in this action and to appeal from the denial of the motion to dismiss (Boxer Aff ¶¶ 3, 5).
In Coutts Bank, the court permitted the plaintiff to serve the subpoena on the defendant's New York counsel pursuant to a court order, noting that the defendant was actively litigating a related action in the state (Coutts Bank, 275 AD2d at 609).
In Estate of Robert Marceca, a judgment creditor served an information subpoena and subpoena duces tecum on the judgment debtor's New York counsel who represented the judgment debtor in the underlying action (2006 NY Misc LEXIS 5240, *1 [Sup Ct, NY County 2006]). The court explained that, in Coutts Bank, "the presence of the witness in New York derived from the [c]ourt's jurisdiction over him in the underlying proceeding, which was deemed to continue for as long as the judgment was open" (Marceca, 2006 NY Misc LEXIS 5240, at *3-4). The court permitted service of the subpoena duces tecum on New York counsel and granted the judgment creditor's "request for an order to be issued nunc pro tunc authorizing service of the subpoena duces tecum in New York on [the judgment debtor's] attorneys" (id.).
Pieper did not dispute the Mann Living Trust's assertion that it served the Subpoena on Pieper's "New York attorneys who have represented, and who continue to represent, Pieper in this action" and who are "also currently representing Pieper in connection with his pending appeal of the June 19 Order" (Affirmation of B. Ted Howes, Esq. In Support of Plaintiff's Opposition to Defendant's Application to Quash Subpoena or for a Protective Order at ¶ 6).
Pieper's attempt to distinguish Coutts Bank and Marceca arguing that counsel only appeared in a limited capacity is unavailing and unsupported by authority. Moreover, contrary to Pieper's contention that service of the Subpoena on Carter Ledyard was improper without first obtaining a court order, an order may have been issued nunc pro tunc (see Marceca, 2006 NY Misc LEXIS 5240, at *4). Accordingly, Pieper fails to demonstrate that service on Carter Ledyard in New York was ineffective.
III. Unduly broad and burdensome
Pieper argues that even assuming that the Subpoena is valid and was properly served, it should be quashed as overly broad and burdensome, or in the alternative, modified (Mem in Supp at 6; Reply Mem at 9).
Pieper fails to demonstrate the requests in the Subpoena are not reasonably calculated to identify assets to satisfy the Mann Living Trust's judgment against Pieper.
To prevail on a motion to quash a subpoena duces tecum, the movant must show that the materials sought are "utterly irrelevant" (see Velez v Hunts Point Multi-Service Ctr., Inc., 29 AD3d 104, 112 [1st Dept 2006]).
The Subpoena seeks documents relating to Pieper's assets or transfer of assets (Request Nos. 1, 2, 4, 11, 14, 20, 28); copies of tax returns since 2005 (Request Nos. 5, 21); documents reflecting Pieper's outstanding debts (Request No.7); copies of bank account statements (Request No. 26); and documents relating to any trusts established for any of Pieper's children (Request No. 32). These requests are reasonably calculated to obtain information relevant to the judgment against Pieper.
Pieper's vague and conclusory assertions that the Subpoena is "vastly overbroad and burdensome" is not persuasive (Mem in Supp at 6). Pieper fails to show that the Subpoena is "utterly irrelevant" (see Velez, 29 AD3d at 112; compare Reuters Ltd. v Dow Jones Telerate, 231 AD2d 337, 344 [1st Dept 1997] [subpoena held unenforceable because it was "patently overbroad, burdensome, and oppressive"]). Pieper's motion to quash the Subpoena on this ground is, therefore, denied.
Accordingly, it is
ORDERED that Pieper's motion to quash the Subpoena duces tecum is denied.
This constitutes the Decision and Order of the Court. Dated: June 24, 2010 New York, New York
E N T E R
Hon. Eileen Bransten