Opinion
Index No. 653468/2022
08-14-2023
RDC-S111, Inc, Plaintiff, v. JTRE 28 LLC and JACK TERZI, Defendants.
Tenaglia & Hunt, P.A., Rochelle Park, N.J. (David Sussman of counsel), for plaintiff. Schwartz Sladkus Reich Greenberg Atlas LLP, New York, NY (Andrea Caruso of counsel), for defendant Jack Terzi. No appearance for defendant JTRE 28 LLC.
Unpublished Opinion
Tenaglia & Hunt, P.A., Rochelle Park, N.J. (David Sussman of counsel), for plaintiff.
Schwartz Sladkus Reich Greenberg Atlas LLP, New York, NY (Andrea Caruso of counsel), for defendant Jack Terzi.
No appearance for defendant JTRE 28 LLC.
Gerald Lebovits, J.
This is an action on a contract (and on an account stated) for design- and project-management-related services rendered in connection with a construction/development project in lower Manhattan, brought by plaintiff, RDC-S111, Inc., against defendants, JTRE 28 LLC and Jack Terzi. Plaintiff has moved under CPLR 3215 for default judgment against defendants. Defendant Terzi has opposed the motion; and his opposition papers raise several factual questions, described below, that must be answered before this court can determine how the motion should be resolved. The court therefore directs plaintiff to provide a supplemental submission replying to Terzi's opposition that addresses those factual questions.
1. A plaintiff moving for default judgment must establish proper service on defendants, defendants' default, and the facts constituting plaintiff's claims. (CPLR 3215 [f].) Plaintiff's affidavit of service on Terzi reflects the use of leave-and-mail service under CPLR 308 (2) through delivery of process to "Emma [D]oe, co-tenant," at a residential address in Brooklyn. (NYSCEF No. 2 [capitalization omitted].) Plaintiff's affidavit of service on defendant JTRE 28 LLC reflects service under CPLR 311 through delivery of process to "Emma [D]oe, general agent of the above named corporation" at the same time, and same address, as service on Terzi. (NYSCEF No. 3 [capitalization omitted].)
Plaintiff's affidavits of service "constitute[] prima facie evidence that the defendant was validly served." (Wachovia Bank, N.A. v Greenberg 138 A.D.3d 984, 985 [2d Dept 2016].) To rebut the resulting presumption of proper service, a defendant must support their denial of service with "specific, detailed facts that contradict the affidavit of service." (Wells Fargo Bank, N.A. v Decesare, 154 A.D.3d 717, 718 [2d Dept 2017].) In opposing plaintiff's motion, Terzi submits an affidavit in which he states that he does not, and has never resided at, nor owned, the Brooklyn apartment at which he was assertedly served, and in fact currently lives in New Jersey. (See NYSCEF No. 25 at ¶¶ 3-4.) These specific representations, which squarely contradict the affidavit of service, are sufficient to rebut a presumption of proper service. And plaintiff has not submitted reply papers responding to Terzi's representations and clarifying the circumstances under which service occurred.
Ordinarily in a scenario of this kind, the court would direct a traverse hearing to resolve the factual dispute between the affidavits of Terzi and of plaintiff's process server for purposes of plaintiff's claims against Terzi. (See e.g. 555 Tenth Ave. LLC v Grace, 2022 NY Slip Op 51287[U], at *3 [Sup Ct, NY County Dec. 19, 2022].) But Terzi's affidavit, and this court's own review of plaintiff's submissions in support of default judgment, give rise to several factual questions beyond those that are the typical stuff of a traverse hearing-both with respect to the claims against Terzi and those against JTRE 28.
2. Plaintiff has submitted the affidavit of its CEO in support of its default-judgment motion. (NYSCEF No. 18.) The affidavit represents that plaintiff entered into a contract with Terzi and with defendant JTRE 28 LLC for the development-related services referenced above (id. at 2 ¶ 5); and that defendants did not pay for those services despite being provided at least one invoice and perhaps more (id. at 2 ¶ 7). The affidavit attaches a copy of a letter agreement that is addressed to "Jack Terzi, JTRE 28 LLC" (id. at 7), that describes the "client" as "JTRE 28 LLC" (id. at 11) and that appears on its face to have been executed (through DocuSign) by Jack Terzi on behalf of JTRE 28 LLC (see id.). But Terzi's affidavit represents not only that he is not now nor has "ever been associated with JTRE 28 LLC," but also that JTRE 28 "is not an entity I am familiar with." (NYSCEF No. 25 at ¶ 5.)
The Department of State's business-entity database, although containing numerous entries for JTRE-affiliated companies, has no entry for a company called "JTRE 28 LLC," active or inactive. This court may take judicial notice of that fact (see LaSonde v Seabrook, 89 A.D.3d 132, 137 n 8 [1st Dept 2011]), although its significance remains to be determined.
The juxtaposition of the affidavit and supporting documents submitted by plaintiff with Terzi's representations in his affidavit raises questions about the authenticity of the agreement submitted by plaintiff in support of its claims against Terzi and against JTRE 28. The rest of plaintiff's motion papers not only fail to dispel those questions, but introduce new ones.
The affirmation of Terzi's counsel also points out that even setting aside authenticity-related questions, the contract appears to be between only plaintiff and JTRE 28, with Terzi (putatively) signing the agreement as a representative of JTRE 28, rather than in his individual capacity. (NYSCEF No. 21 at ¶ 16.) Although Terzi thus would seem to have a strong argument that he may not be held personally liable on the contract (see Salzman Sign Co. v Beck, 10 N.Y.2d 63, 67 [1961]), the court reserves decision on this issue pending plaintiff's supplemental submission.
For example, plaintiff's complaint and default-judgment affidavit each allege that defendant JTRE 28 is located at 362 Fifth Avenue, 12th Floor, in Manhattan. (NYSCEF No. 1 at ¶ 2; NYSCEF No. 18 at 1 ¶ 2.) It is therefore hard to understand why plaintiff would have served JTRE 28 at a residential address in Brooklyn. Plaintiff's motion papers do not provide an explanation. Additionally, the invoices attached to plaintiff's affidavit, on which plaintiff rests its account-stated claim, are addressed not to JTRE 28 LLC at 362 Fifth Avenue, but rather to JTRE Holdings at 352 Fifth Avenue. (See NYSCEF No. 18 at 14, 17, 20, 22, 24, 25, 26; see also id. at 28 [account statement].)
As discussed above, plaintiff also putatively served Terzi at that Brooklyn service address by delivery of papers to the same person to whom plaintiff delivered process for JTRE 28. (See NYSCEF Nos. 2 and 3.) Although JTRE 28 has neither appeared nor filed papers in this action, Terzi's denial of a connection between himself and the Brooklyn address raises a factual question about the validity of service on JTRE 28 by delivery to that address.
Plaintiff has not provided proof of mailing of the invoices or the account statement attached to the affidavit of its CEO. At most, that affidavit represents that (i) the affiant "ha[s] personal knowledge of Plaintiff's procedures for generating and mailing account statements to customers," and (ii) "[o]n or about July 15, 2021, Plaintiff sent the final invoice relating to the Account to Defendant." (NYSCEF No. 18 at 2 ¶ 5.) The affidavit does not, however, provide the source and nature of the affiant's knowledge that plaintiff sent the July 2021 invoice to JTRE 28. The affidavit does not represent that plaintiff sent any of the other invoices to JTRE 28-nor, for that matter, that JTRE 28 retained any of the invoices without objection.
In short, the record as it stands leaves this court unsure of (i) the authenticity of the underlying contract; (ii) the identity of plaintiff's counterparties to the contract; (iii) the extent of the monetary obligations (and associated liability) owed by those counterparties to plaintiff in connection with the contract; and (iv) the validity of service on the defendants in this action. Given that this court's questions bear both on service and on the merits, the court concludes that the best way to proceed is for plaintiff to file a supplemental submission in support of its default-judgment motion, replying to Terzi's opposition papers and addressing the court's questions. The court will then resolve the current motion in light of plaintiff's supplemental submission and the rest of the record.
Accordingly, it is
ORDERED that plaintiff shall, within 30 days of entry of this order, submit supplemental papers in support of its default-judgment motion (by e-filing and email to SFC-Part7-Clerk@nycourts.gov) as set forth above; and it is further
ORDERED that upon plaintiff's filing of a supplemental submission, or upon the expiration of 30 days from entry of this order, this court will render an appropriate determination on plaintiff's motion.