Opinion
1507/05.
Decided April 22, 2008.
Richard S. Jaffe, Esq., Law Office of Cohen Jaffe, LLP, Lake Success, NY, Counsel for Defendants.
Joseph Sparacio, Esq., Staten Island, NY, Counsel for Plaintiffs.
Defendants Dollar Rent A Car and Dollar Rent A Car, Citiwide Auto Leasing ("defendants") move for an order removing these actions from Richmond County because plaintiffs Lenox Neuropsychiatry P.C., Tribeca Medical P.C., and Richard A. Hellander MD PC ("plaintiffs") chose an improper venue.
Plaintiffs commenced these actions in Civil Court, Richmond County to recover payments for no fault insurance benefits, based upon health services and treatment rendered by plaintiffs to three individuals who were insured under automobile liability insurance policies written by the three defendants. Defendants timely submitted their answers which contained a plethora of affirmative defenses.
By separate motions, defendants argue that venue is improper in Richmond County pursuant to New York Civil Court Act ("NYCCA") § 305(a), which provides in part that if "the plaintiff is an assignee of the cause of action, the original owner of the cause of action shall be deemed the plaintiff for the purpose of determining proper venue." Defendants assert that the assignors have no connection with the County of Richmond as two of them reside in Kings County and one resides in Queens County. Venue in Richmond County, therefore, is improper "ab initio" and venue should be moved to Kings County and Queens County where the three assignors live. Defendants also hypothesize that plaintiffs chose Richmond County for their own convenience since both defendant Dollar Rent A Car and defendant Dollar Rent A Car, Citiwide Auto Leasing maintain their places of business in Brooklyn, as set forth in plaintiffs' summons (each attached to the three separate motions as Exhibit "A"). Finally, defendants assert that plaintiffs have forfeited the right to select venue in an action by choosing an improper venue in the first instance.
In response, plaintiffs submitted an ad from the Verizon Staten Island Yellow Pages listing "Dollar Rent A Car" and a toll free 1-800 number through which one can make world wide reservations. The advertisement contains no address, much less a Staten Island address, for "Dollar Rent A Car". Plaintiffs contend that this ad is sufficient to demonstrate that defendants "transact" business within the meaning of Civil Court Act § 305(b).
Defendants submit that this proof is "inconclusive" on its face and fails to prove that defendants actually transact business in Richmond County. Rather, defendants maintain their place of business in Kings County at an address listed on plaintiffs' summonses and do not maintain any office or transact any business in Richmond County. Defendants also submit that there are numerous "Dollar Rent A Car" businesses in New York State that operate independently of each other, as garnered from the NY State Department of State Corporation ("DOS") and Business Entity databases, and that the "lone phone book listing" submitted by plaintiffs "does not reflexively prove that the instant defendants are in any way affiliated with Dollar Rent A Car' or that they transact business in Richmond County. Simply sharing a moniker is not indicative that two entities are actually related" (Defendants' Reply). Defendants computer search revealed six entities that contain the moniker "Dollar Rent A Car", plus an appendage, such as Dollar Rent A Car Systems, Inc. or Dollar Rent A Car, Inc. Etc., which either have an address in New York to which the DOS will mail process, or has a New York registered agent. In neither of these circumstances is a Richmond County address listed.
Curiously, defendants did not provide the Department of State, Division of Corporations entity information for either Dollar Rent A Car or Dollar Rent A Car,7 Citiwide Auto Leasing.
Defendants' argument as to why venue should be changed is incorrect. The issue presented by this case is not where the assignor resides for purposes of establishing the proper venue for plaintiff, but rather whether sufficient evidence has been produced that Dollar Rent A Car and Dollar Rent A Car, City Wide Auto Leasing "transact business" in Richmond County.
Pursuant to Civil Court Act ("CCA") § 305(b), "a corporation . . . shall be deemed a resident of any county wherein it transacts business, keeps an office, has an agency or is established by law." In the leading case of Mingmen Acupuncture v. American Insurance. 183 Misc 2d 270 (Civil Ct., Bronx Co. 1999), the court set forth that pursuant to article 3 of the CCA, venue of a proceeding is initially chosen by the plaintiff based upon the residence of one of the parties (CCA 310, 305), and that "unless the balance is strongly in favor of the defendant, the plaintiff's choice of forum should rarely be disturbed" Id at 273. Furthermore, upon a motion to change said venue, defendant bears the burden of establishing that "plaintiff's choice of forum is not appropriate or that other factors and circumstances require that venue be changed" Id at 274 . See Islamic Republic v. Pahlavi, 62 NY2d 474, 479 (1985).
In Mingmen, supra, the court exhaustively reviewed the "numerous divergent decisions" on whether the phrase "transacts business" in CCA § 305 must be given the same meaning as that given to the same phrase in the long arm jurisdictional provision of CPLR 302(a)(1). Id at 275-78. It found that the term "transacts business" for venue purposes must be construed in a more liberal fashion since the CCA venue statute does not contain the requirement set forth in the long arm jurisdiction statute (CPLR § 302(a)) that the cause of action must arise out of the transaction of business. 183 Misc 2d at 278-79. While the long arm jurisdiction under CPLR § 302(a) mandates the existence of some articulable nexus between the business transacted and the cause of action sued upon [ McGowan v. Smith, 52 NY2d 268, 272 (1981) (the transitory business actually transacted here was sufficiently related to the subject matter of the lawsuit to justify the exercise of in personam jurisdiction under CPLR § 302)], under CCA § 305, there need not be a nexus between the cause of action in issue and the business transacted by the corporation in that particular county. 183 Misc 2d at 279 Compare McGowan v. State, 52 NY2d 268.
This distinction, according to the court, is in line with the more liberal construction that must be accorded to venue rules, since venue — "the permitted situs of a proceeding, assumes that the court already is possessed with the personal and subject matter jurisdiction." 183 Misc 2d at 277. Furthermore, "venue choice, unlike those involving the jurisdiction of the court, does not result in the enlargement or impairment of substantive rights or obligations," and the commencement of a proceeding in the wrong county does not result in the dismissal of the case. Id. at 274. The Mingman court also reiterated that "it takes far fewer contacts with a forum to establish that a defendant has "transacted business" than it takes to establish that "it is doing business." Id at 280; McGowan v. Smith, supra; Rung v. U.S. Fid. Guar, Co., 139 AD2d 914 (4th Dept. 1988).
In Rung, supra (interpreting CPLR § 302), the court found that the defendant had transacted business in New York because it "engaged in purposeful activity in New York by regularly corresponding by mail or telephone with plaintiff's insurance company in New York." 139 AD2d at 915 In Mingman, the court found the following evidence to support the contention that the defendant regularly issued policies to and transacted business with residents in Bronx County: plaintiff identified five insurance policies with name, Bronx address and policy number. Furthermore, the defendant did not controvert either plaintiff's proof or its broader allegation that defendant regularly engages in all the other ancillary activities necessary to transact such business:" solicitation of Bronx residents, issuance of insurance policies, collection of premiums, forwarding of invoices and other correspondence." 183 Misc 2d at 272. See also, Andrew Carothers v. Liberty Mutual. 13 Misc.1212A, 824 N.Y.S. 2d 753(Civil Ct. Richmond Co. 2006) (defendants' submissions that they do not have any claims, sales or offices in Richmond County did not foreclose the very distinct possibility' that defendants issued insurance policies covering Richmond County residents" and that they engaged in purposeful activity by regularly corresponding by mail or telephone with its policy holders in Richmond County by delivering insurance policies, sending invoices and collecting premiums from them); Neurologic Serv. v. American Transit Insurance Co., 183 Misc 2d 496 (Civil Ct., Bronx Co. 1999) (none of assignors were Bronx residents, but issuance of insurance policies to Bronx residents is sufficient transaction of business to qualify the defendant as a Bronx resident for purposes of venue).
Defendant has not specifically addressed this standard in claiming that venue should not rest in Richmond County. Plaintiffs, on the other hand, have merely proffered one page from the Verizon's Staten Island Yellow Pages which lists a 1-800 number for Dollar Rent A Car. Based upon the evidence submitted it is impossible to assess whether defendants transact business in Richmond. At this point, the court denies the motion to change venue based upon the precedent that defendants bear the burden of establishing that "plaintiffs' choice of forum is not appropriate". Defendants may, however, renew this motion upon a showing of evidence that addresses the aforementioned standards.
The foregoing constitutes the decision and order of the Court.