Opinion
109070/06.
Decided on December 4, 2006.
Plaintiff seeks to enforce a sister-state judgment by this motion for summary judgment in lieu of complaint. (CPLR § 3213).
Facts
This action was based upon a District of Columbia decision and order docketed in the District of Columbia court (the DC court) on March 23, 2006 (the DC decision).
In the proceedings before the DC court, plaintiff Infinite Public Relations, LLC (Infinite) sought to confirm an arbitration award issued on November 1, 2005 by the American Arbitration Association. The genesis of the dispute between the parties was a letter sent to the defendant law firm, Rubinstein Rubinstein LLP (Rubinstein) dated October 7, 2002, from Infinite. Rubinstein was located in New York City, and Infinite was located in the District of Columbia.
Concluding that it had both subject matter and personal jurisdiction, the DC court confirmed the arbitration award in favor of Infinite, and against defendant Rubinstein, in the amount of $117,234.22, plus interest at the rate of 6% per annum. It should be noted that the award consisted of $15,000 due on the contract between the parties, $9,886.78 in pre-award interest, $89,497.44 in attorneys' fees and $2,850 for administrative fees and expenses.
Plaintiff commenced the instant action in June of 2006, seeking entry of the judgment issued by the DC court. The instant motion followed.
History
Notwithstanding the protestations of the Defendant, all of the tribunals involved with this litigation have concluded that a binding contract containing a valid arbitration clause was entered into sometime in late October of 2002. By March of 2003, Infinite had commenced an arbitration proceeding in the District of Colombia to recover for three months work it had allegedly performed. Thereafter, Rubinstein commenced an action in the Civil Court of the City of New York alleging breach of contract, breach of warranty and misrepresentation. Rubinstein sought the return of $2,500 which had been paid to Infinite.
Rubinstein Rubinstein v. Infinite Public Relations, LLC, 8 Misc 3d 126 (A), __NYS2d__2005, 2005 WL 139745, 2005 NY Slip Op. 50898(U) (NY Sup. App. Term June 13, 2005 (Table Text in Westlaw, No. 570827/03); Rubinstein Rubinstein v. Infinite Public Relations LLC, Index No. 570827/03 (leave to appeal denied) [1st Dept. Nov. 3, 2005]);
In the course of the Civil Court proceeding, Rubinstein moved for an order permanently staying the arbitration proceeding in the District of Columbia. Infinite cross-moved to compel arbitration. By decision and order dated June 18, 2003, Judge Scarpulla found that there was a valid agreement to arbitrate and that Infinite Public Relations, the Plaintiff in this action, had standing to compel arbitration. Judge Scarpulla then stayed the New York action and directed the parties to proceed with arbitration in the District of Columbia. Judge Scarpulla's decision was unanimously affirmed by the Appellate Term on June 13, 2005 and leave to appeal to the Appellate Division was denied on November 3, 2005.
Defendant presently opposes the enforcement of the DC judgment based on the claim that the DC court lacked both personal and subject matter jurisdiction. Defendant further claims that the DC arbitrator exceeded his powers, and that principles of comity barred jurisdiction in the District of Columbia based on the proceedings which were pending in the New York courts at the time this matter was brought before the DC courts.
Discussion
The full faith and credit clause of the Constitution (U.S. Const. Art. IV § 1), mandates that all American Courts recognize each other's judgments. A court is required to recognize the validity of a rendered judgment of another state and to give that judgment the same preclusive effect the rendering jurisdiction expects for its judgments. ( CIBC Mellon Trust Company v. Mora Hotel Corporation N.V., 296 AD2d 81 [1st Dept 2002]).
Moreover, as Judge Saxe stated in CIBC Mellon, supra:
"[a]s to judgments of sister states, the rule is well settled: a defendant who has made a special appearance to challenge the jurisdiction of a sister state's courts, and whose position has been considered and rejected by that court, may not be heard to raise the jurisdictional challenge anew when the plaintiff seeks to enforce the judgment in a second state." (emphasis added)
( See Id. at 91-92). This applies even where the sister state's long-arm jurisdiction is at odds with the New York Rule. ( China Express Inc. v. Volpi Son Machine Corp., 126 AD2d 239 [1st Dept 1987]).
With this in mind, the court notes that the Defendant once again raises the very same issues that three New York courts, one District of Columbia court and an arbitrator have already put to rest. As a preliminary matter, Defendant's claim that the DC court lacked subject matter jurisdiction over the arbitration was raised and rejected. (DC court decision p. 4-5). The doctrine of collateral estoppel prevents a party from relitigating, in a subsequent proceeding, an issue raised in a prior proceeding and decided against that party even when the tribunal is different. ( Cartesian Broadcasting Network, Inc. v. Robeco, USA, 10 Misc 3d 1060, 2005 WL 3442964 *2 [NY Sup. Ct. NY Cty. June 6, 2005]). Given that under the full faith and credit clause of the Constitution, a New York court is required to give a sister state's judgment the same collateral estoppel effect it would be afforded in New York, Defendant may not relitigate this issue here.
Defendant's claim that the DC court had no personal jurisdiction over it was also raised and rejected by the DC court. Much like New York, the District of Columbia has a statutory provision which permits the exercise of long-arm jurisdiction over non-residents who purposefully engage in some type of commercial or business related activity directed at the residents of the state. ( Holdin v. Haarman Reimer Co, 779 AD2d 264 [DC 2001]; DC Code Ann. § 13-423(a); CPLR § 302; New York Civil Practice Before Trial Vol I, Barr Altman Lipshie and Gersman, James Publishing 2005, §§ 7:201-05, § 7:220). As previously noted, once Defendant asserted its jurisdictional challenge, the applicable laws were those of the District of Columbia, notwithstanding whether or not their laws were at odds with the New York rule. ( China Express, Inc. v Volpi Son Machine Corp, 126 AD2d 239, 242 [1st Dept 1987]).
Applying its laws concerning jurisdiction, the DC court found that "Rubinstein could have reasonably anticipated being brought into court in the District of Columbia." (Defendant's Exh. D p. 5). Furthermore, the court noted that:
[a]lthough Infinite may have been winding down' its affairs in the District, it was, at the time the parties began negotiations and the retainer was finalized, a limited liability corporation organized under the law of the District of Columbia.( Id.)
Additionally, the DC court found that the retainer agreement which was the subject of the parties' agreement expressly stated that the it was to be construed as if created in the District of Columbia. Invoices mailed to Rubinstein called for checks to be paid to Infinite in the District of Columbia. Finally, the DC court held that traditional notions of fair play and substantial justice were not offended since this non-resident defendant had engaged in a business-related activity, namely, public relations services, with a company located in the District of Columbia.
Finally, Defendant also argued, unsuccessfully, that comity required that the DC Court defer to the New York Court. However, that argument was also rejected previously in the DC decision, which noted that the arbitration had already been commenced at the time of the civil court action and more significantly, the civil court action, as commenced, confirmed only Rubinstein's claims against Infinite:
[t]he confirmation of the arbitration award was never before the New York court, therefore it never obtained jurisdiction over the matter presently before this court. This is especially true since Infinite commenced the arbitration proceeding before Rubinstein filed its lawsuit in the New York court.
(DC decision p. 7). Inasmuch as Rubinstein did not interpose a counterclaim in the arbitration, and Judge Scarpulla and two New York appellate courts ruled that the underlying claims were arbitrable, Rubinstein's claims against Infinite are no longer viable.
For the reasons set forth above, it is this court's decision that a final and valid judgment was entered by the Superior Court for the District of Columbia. Since there has been no issue raised that would preclude this court from giving that judgment full faith and credit, Plaintiff is entitled to Judgment in the amount of $117,234.22 plus interest at a rate of 6% per annum as set out by the arbitration award.
Accordingly, it is
ORDERED that Plaintiff's motion for summary judgment in lieu of the complaint is granted; and it is further
ORDERED that Petitioner, is awarded judgment against Respondent in the amount of $117,234.22, plus interest at the rate of 6% per annum, as computed by the Clerk, together with costs and disbursements as taxed by the Clerk, and that the Petitioner have execution therefor.
This memorandum opinion constitutes the decision and order of the Court.
Dated:
____________________________
HON. WALTER B. TOLUB, J.S.C.
Infinite Public Relations, LLC v. Rubinstein Rubinstein, Sup. Ct. DC Civil Div., Civ. Action No. 05-8979 [March 20, 2006]);
Infinite Public Relations, LLC v. Rubinstein Rubinstein, Sup. Ct. DC Civil Div., Civ. Action No. 05-8979 Judgment [April 21, 2006]).