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Shabtai v. HFZ Capital Grp.

Supreme Court of New York, First Department
Oct 10, 2023
220 A.D.3d 471 (N.Y. App. Div. 2023)

Opinion

735-, 735A Index No. 653453/21 Case No.2022–03558

10-10-2023

Benjamin SHABTAI, Plaintiff–Respondent, v. HFZ CAPITAL GROUP, LLC, et al., Defendants, HFZ Shore Club LLC et al., Defendants–Appellants.

Milbank LLP, New York (Daniel M. Perry of counsel), for appellants. Schwartz Sladkus Reich Greenberg Atlas LLP, New York (Ethan A. Kobre of counsel), for respondent.


Milbank LLP, New York (Daniel M. Perry of counsel), for appellants.

Schwartz Sladkus Reich Greenberg Atlas LLP, New York (Ethan A. Kobre of counsel), for respondent.

Manzanet–Daniels, J.P., Gesmer, Gonza´lez, Kennedy, O'Neill Levy, JJ.

Judgment, Supreme Court, New York County (Andrew Borrok, J.), entered August 1, 2022, in favor of plaintiff Shabtai and against defendants, the Shore Club Entities, for the total sum of $5,054,291.10, unanimously affirmed, with costs. Appeal from order, same court and Justice, entered July 26, 2022, which granted Shabtai's motion for a default judgment, directed entry of judgment in favor of Shabtai, ordered that a constructive trust be placed upon all of the Shore Club Entities’ assets, and ordered the Shore Club Entities to provide an accounting to Shabtai, unanimously dismissed, without costs, as subsumed in the appeal from the judgment.

To vacate a default judgment, a movant must establish both a reasonable excuse for its default and a meritorious defense to the plaintiff's claims ( Xiaoyong Zhang v. Jong, 195 A.D.3d 435, 435, 144 N.Y.S.3d 581 [1st Dept. 2021] ). The failure to maintain a current mailing address for service of process is not a reasonable excuse for defaulting (see Majada Inc. v. E & A RE Capital Corp., 205 A.D.3d 648, 649, 170 N.Y.S.3d 18 [1st Dept. 2022] ; State Farm Mut. Auto. Ins. Co. v. Dr. Ibrahim Fatiha Chiropractic, P.C., 147 A.D.3d 696, 697, 48 N.Y.S.3d 133 [1st Dept. 2017] ). According to the affidavit submitted by the Shore Club Entities, the dissolution of the Shore Club Entities and the failure to update their agent's address for service of process was not a "high priority." Under these circumstances, the motion for a default judgment was providently granted.

Since the Shore Club Entities have no reasonable excuse for defaulting, defendants’ defenses need not be addressed (see Rudd Mech. Assoc., Inc. v. ZDG, LLC, 192 A.D.3d 440, 441, 139 N.Y.S.3d 802 [1st Dept. 2021] ).


Summaries of

Shabtai v. HFZ Capital Grp.

Supreme Court of New York, First Department
Oct 10, 2023
220 A.D.3d 471 (N.Y. App. Div. 2023)
Case details for

Shabtai v. HFZ Capital Grp.

Case Details

Full title:Benjamin Shabtai, Plaintiff-Respondent, v. HFZ Capital Group, LLC, et al.…

Court:Supreme Court of New York, First Department

Date published: Oct 10, 2023

Citations

220 A.D.3d 471 (N.Y. App. Div. 2023)
2023 N.Y. Slip Op. 5109
197 N.Y.S.3d 502