Opinion
INDEX NO.: 35845/2011
05-12-2015
FIA CARD SERVICES, N.A., Plaintiff, v. RANDY T RODECKER, Defendant.
PLAINTIFF'S ATTY: MULLOOLY, JEFFREY, ROONEY & FLYNN, LLP By: Timothy F. Rooney, Esq. PO Box 9036, 6851 Jericho Tnpk., St. 220 Syosset, NY 11791-9036 DEFENDANT'S ATTY: RICHARD JOHANNESEN, ESQ. 544 Business Route 25A Rocky Point, NY 11778
Short Form Order
COPY
PRESENT: HON. JAMES HUDSON Acting Justice of the Supreme Court
SEQ. NO.:002-MD
PLAINTIFF'S ATTY:
MULLOOLY, JEFFREY, ROONEY
& FLYNN, LLP
By: Timothy F. Rooney, Esq.
PO Box 9036, 6851 Jericho Tnpk., St. 220
Syosset, NY 11791-9036
DEFENDANT'S ATTY:
RICHARD JOHANNESEN, ESQ.
544 Business Route 25A
Rocky Point, NY 11778
Upon the following papers numbered 1-18 read on this motion for Summary Judgment; Notice of Motion/ Order to Show Cause and supporting papers 1-11; Notice of Cross Motion and supporting papers 0 ; Answering Affidavits and supporting papers 12-18; Replying Affidavits and supporting papers 0; Other ___ ; (and after hearing counsel in support and opposed to the motion),
ORDERED , that Plaintiff's motion for Summary Judgment in its' favor and against the Defendant is denied with leave to renew (CPLR § 3212).
The matter at hand is an action for damages sounding in breach of contract and for an account stated. Plaintiff alleges, inter alia:
"...that Defendant opened an account with FIA Card Services, N.A., or a predecessor in interest, for the purpose of obtaining an extension of credit (The "Account") and did thereafter use or authorize the use of the Account for the acquisition of goods, services, or cash advances in accordance with the customer agreement ("Agreement") governing use of the Account. [Plaintiff contends that] Defendant has breached the Agreement by failing to make periodic payments as required thereby. The last payment was
received by Plaintiff on or about August 5, 2010"...The books and records of Plaintiff show that Defendant is currently indebted to Plaintiff...for the just and true sum of $45,836.91." (Affidavit of Wendy Parnell dated September 15, 2014, custodian of records of the corporate Plaintiff).
Plaintiff has moved for summary (CPLR § 3212). In support of its' motion, Plaintiff has submitted documentary proof in the form of a credit card agreement and monthly statements (Plaintiff's Exhibit "A"*). Additionally, Plaintiff has submitted records of partial payments.
Defendant opposes the motion. The gravamen of the opposition to summary relief is as follows: Mr. Rodecker claims that he did not sign a contract individually for an account nor did he execute a personal guarantee for same. In his answer he raises 12 affirmative defenses including: (1) The complaint fails to state cause of action (2) Satisfaction (3) Equitable doctrine of laches (4) Statute of limitations (5) All risks, dangers, hazards were obvious, open and well known to Plaintiff and assumed by it (6) Plaintiff failed to mitigate damages (7) The complaint fails to allege conditions precedent to claim (8) The claim is barred by mutual mistake (9) Any award for title damages not based on clear and convincing evidence is violative of the fed and state constitutions (10) Claims for title damages are excessive and disproportionate and thus unconstitutional under the due process clause 14th amendment to the Bill of Rights (11) The claim is barred by the Statute of Frauds and (12) The individual Defendant is not a proper party to the action.
In his papers opposing the instant application, Mr. Rodecker denies that the money is owed and contends that the debt was incurred by Randy T Rodecker Inc.. He further asserts that the credit card was strictly a corporate account and "that he has no personal connection with same" (affirmation of defense counsel para. 13). Based on his narrative of events, it is Mr. Rodecker's position that he cannot be personally liable for the debt and relies on the holdings in: Knect v. Nassau County Native Americans , Inc . 41 AD3d 435 [2nd Dept.2007]; Noel v. L & M holding Corp . 35 A.D.3d 681 [2nd Dept.2006]; Yellow Book Co. Inc. v. Mega , 190 Misc.2d 108; and Gottehrer v. Viet-Hoa Co ., 170 AD2d 648 [2nd Dept. 1991].
Summary judgment is a drastic remedy to be granted only when the Court determines there is no clear triable issue of fact. Even the color of a triable issue forecloses the remedy ( Benincasa v. Garrubo , 141 A.D.2d 618 [2d Dept. 1988]). In a dispute where the facts are uncontroverted, and the intent of the parties can be discerned from the face of a contract between the parties, the Court is confined to an interpretation of law and the matter is "ripe" for summary judgment ( American Exp. Bank Ltd. v. Uniroyal Inc ., 164 A.D.2d 275 [1st Dept. 1990], appeal denied 77 N.Y.2d 807).
The essential question before the Court is whether Plaintiff has succeeded in showing its entitlement to summary judgment by sufficient evidence. We remind the parties that "This burden is a heavy one and on a motion for summary judgment, "facts must be viewed in the light most favorable to the non-moving party" ( William J. Jenack Estate Appraisers and Auctioneers , Inc. v. Rabizadeh , 22 N.Y.3d 470, 475, 982 N.Y.S.2d 813, [2013]). "Where the moving party fails to meet this burden, summary judgment cannot be granted, and the non-moving party bears no burden to otherwise persuade the court against summary judgment" (id.).
Once the burden has been met, the Respondent cannot escape summary judgment "unless its opposing papers [raise] genuine factual issues" Badische Bank v. Ronel Systems , Inc . 36 A.D.2d 763, 321 N.Y.S.2d 320 [2nd Dept. 1971]; Leumi Fin. Corp. v. Richter , 24 A.D.2d 855, 264 N.Y.S.2d 707, affd. 17 N.Y.2d 166, 269 N.Y.S.2d 409, 216 N.E.2d 579; Stagg Tool & Die Corp. v. Weisman , 12 A.D.2d 99, 102, 208 N.Y.S.2d 585, 588)."
Prior to our analysis of the applicable law, we would like to compliment both Plaintiff's and defense counsel for the eloquence of their respective submissions before the Court.
One point which the defense brings to the Court's attention is the fact that Plaintiff has not produced an executed contract signed by Defendant. Counsel uses this to advance his argument that a corporate officer is generally not understood to be personally liable for a corporate debt ( American Media Concepts Inc. v. Atkins Pictures Inc ., 179 A.D.2d 446 [1st Dept. 1992]) citing to Salman Sign Co. Inc. v. Beck , 10 NY 2d 63. As Plaintiff's counsel correctly asserts, however, "[A] contract may be valid even if it is not signed by the party to be charged, provided its subject matter does not implicate a statute—such as the statute of frauds (General Obligations Law § 5-701)—that imposes such a requirement [cite omitted]," ( Priceless Custom Homes , Inc. v. O'Neill , 104 A.D.3d 664, 960 N.Y.S.2d 455, [2nd Dept.,2013].
Moreover, a written contract, signed by the party to be charged, is not a prerequisite to a successful summary judgment motion on a cause of action for an account stated. Plaintiff's counsel cites to the venerable authority found in Rodkinson v. Haecker 248 N.Y. 480,485 [1928] wherein the Court stated:
"As a general rule, where an account is made up and rendered, he who receives it is bound to examine the same, or to procure some one to examine it for him. If he admits it to be correct it becomes a stated account, and is binding on both parties. If, instead of an express admission of the
correctness of the account, the party receiving it keeps the same by him and makes no objection within a reasonable time, his silence will be construed into an acquiescence in its justness, and he will be bound by it as if it were a stated account."
This doctrine finds modern voice in the case of American Exp. Centurion Bank v. Williams , 24 A.D.3d 577, 807 N.Y.S.2d 612 [2nd Dept.,2005]. In that case, the Appellate Division opined that in order to prevail on a CPLR § 3212 motion for an account stated, a Plaintiff must demonstrate "with evidence in admissible form, that it generated statements for the Defendant in the regular course of business and mailed those statements to the Defendant on a monthly basis.... The Defendant accepted these account statements and retained them without objection..." (Id.).
In arguing that it has met it's burden, Plaintiff's counsel offers case law including reliance on the authority found in: Falk v. Goodman , 7 N.Y.2d 87, 90, 195 N.Y.S.2d 645 [1959]; Badische Bank v. Ronel Systems , Inc . supra; Mintz v. Dallek & Zaret Associates , Ltd. 120 A.D.2d 654, 502 N.Y.S.2d 248 [2nd Dept. 1986]; and Marine Midland Bank , N.A. v. Scallen , 161 A.D.2d 103, 554 N.Y.S.2d 541 [1st Dept. 1990].
In examining the aforementioned authority alongside the evidence submitted by Plaintiff, we find that summary judgment is inappropriate. In Badische Bank v. Ronel Systems , Inc ., summary relief was granted after "Plaintiff made out a prima facie case by proof of the notes and a failure to make the payments called for..." (Id at 763). In Mintz v. Dallek & Zaret Associates , the Court approved of summary judgment when Plaintiff had "...made out a prima facie case by submitting the promissory note and the notices of default" (Id. at 654). In Marine Midland Bank , N.A. v. Scallen , the Court noted with approbation that "...Plaintiff has, by establishing the validity of the notes and their nonpayment, made out a prima facie case for the relief it seeks," (Id. at 103).
Plaintiff places great emphasis on the persuasive authority found in First Deposit Nat. Bank v. Moreno , 159 Misc.2d 920, 606 N.Y.S.2d 938 [NYC Civ.Ct.,1993]. The Court in First Deposit was also presented with an action to enforce an account stated. In granting the motion for summary judgment the Court noted:
"Plaintiff has submitted copies of the Agreement and monthly account statements sent to Defendant. The final statement demands the amount claimed due in this action... Plaintiff's Assistant Vice President states that, after the statements were mailed to Defendant, she never objected to any of the statements. Thus, Plaintiff has made out its prima facie case for both its breach of contract and account stated causes of action." (Id. at 921).
The common factual thread in the aforementioned decisions is the presence of the contract. That essential proof listed as factoring into the Courts' determination contrasts with the evidence offered by Plaintiff in the case at bar. The Court has already listed the Plaintiff's proof. Some aspects of the submissions give us pause and will be discussed in detail.
Initially, the affirmation of Plaintiff's counsel refers to the Defendant as "Michael D. Donovan" and states the card was used on and between May of 2008 and May of 2010 (para 3). The affirmation then relates that the Defendant failed to make payments and "entire balance of $16,460.59 became due and owing," (Affirmation para 4). Although a perusal of the documentary evidence submitted by Plaintiff indicates that the reference to Mr. Michael Donovan and $16,460.59 (instead of Mr. Rodecker and $45,836.91), appears to be a typographical error, Plaintiff has not addressed this discrepancy in its reply. Although unsettling, this is not the determinative factor in deciding the propriety of summary judgment.
The primary reason for the Court's conclusion that there is a paucity to the Plaintiff's evidence flows from an examination of the purported cardholder agreement. Plaintiff's Exhibit "A" consists of monthly account statements preceded by a 4 page document that reads in relevant part: "Randy T Rodecker, We're changing some of the terms of your credit card agreement"(emphasis ours). There are no signatures and the address indicates that it was sent to "Randy T Rodecker, 471 Route 25A, Rocky Point, NY 11778-8884." This is the business address of the Defendant and the Corporation. The prior document referred to is not annexed nor is it discussed. There are other references to statements being sent to the Defendants home address but no explanation as to why the addresses differed in the first place. The references to an earlier agreement which is being, not changed, but modified, are of great significance. It is well settled law that in examining a contract, the agreement must be considered in its totality in order to determine the parties' intent ( W.W.W. Assocs . v. Giancontieri , 77 N.Y.2d 157, 162 [1990] 565 N.Y.S.2d 440). The Court cannot speculate on the contents of an absent agreement.
As to the question of partial payment on the account, the evidence presented by the Plaintiff consists of a series of six checks: Check 6439 -$968.00 2/22/10;
Check 6528- $939.00 3/17/10;
Check 6723-$1000.00 4/23/10;
Check 6910-$982.00 5/17/10;
Check 7310-$984.00 6/25/10; and
Check 7591-$1,016.00 7/30/10.
All of these checks are drawn on the account of "Randy T Rodecker Inc. d/b/a Swim King Pools."
These checks do not establish that Defendant made "partial payment on the account" ( American Exp. Centurion Bank v. Cutler 81 A.D.3d 761, 916 N.Y.S.2d 622 [2nd Dept.2011]). Instead, the documentary evidence indicates that a presumably valid corporate entity had actually made payment. Plaintiff's protestations to the contrary, logic dictates that the Corporation would be paying for monies and merchandise the Corporation received, and not for property delivered to another. In short, the Plaintiff's receipt of the checks from the Corporation suggests that the Corporation was retaining monthly "...bills without objecting to them within a reasonable period of time..." (Id. at 762 citing, Cohen Tauber Spievak & Wagner , LLP v. Alnwick , 33 A.D.3d 562, 825 N.Y.S.2d 439; Morrison Cohen Singer & Weinstein , LLP v. Waters , 13 A.D.3d 51, 786 N.Y.S.2d 155; Jovee Contr. Corp. v. AIA Envtl. Corp ., 283 A.D.2d 398, 724 N.Y.S.2d 455; Citibank [ S.D.] v. Jones , 272 A.D.2d 815, 708 N.Y.S.2d 517; Schneider Fuel Oil v. DeGennaro , 238 A.D.2d 495, 656 N.Y.S.2d 668).
The foregoing militates against the granting of summary judgment at this juncture. As the Court stated in Falk v. Goodman , supra, "It is well established that summary judgment may not be granted whenever the pleadings raise clear, well-defined and genuine issues; nor may it be granted whenever there is doubt as to the existence of a triable issue or when the issue is arguable since "issue-finding, rather than issue-determination is the key to the procedure." (id. at 90 cites omitted).
Under the circumstances presented, we find that the evidence submitted by the movant is equivocal and warrants denial of the motion. Thus it is unnecessary to consider the opposing proof of Defendant ( William J. Jenack Estate Appraisers and Auctioneers , Inc. v. Rabizadeh , supra).
Assuming, arguendo, that we found Plaintiff had established it's prima facie case, the proof submitted by Defendant is sufficient to defeat the instant motion.
The Defendant has submitted an affidavit which reads in relevant part "...in my capacity as president, I sought corporate xcredit (sic) from Bank of America...I do know that I sought credit for the Corporation only; I never intended this account for personal transactions..." (Affidavit of Randy T. Rodecker dated October 20th, 2014). The Defendant has also submitted a copy of the Certificate of Incorporation subscribed January 2, 1992 for "Randy T. Rodecker Inc.," and filed January 3,1992 (Defendants Exhibit "D"). When this evidence is compared with such factors as the modified cardholder agreement referring to an earlier (and unproduced) contract as well as the actions of the corporate entity in paying the monthly account, a triable issue has arisen concerning the objective intent of the parties as to whether the Defendant or the Corporation would be liable for the debt (see, Citibank (South Dakota) , N.A. v. Brown-Serulovic , 97 A.D.3d 522, 948 N.Y.S.2d 331 [2nd Dept.2012].
Accordingly, the motion will be denied with leave to renew upon the completion of discovery. *The custom in our Court is for Plaintiff's exhibits to be designated by numbers and defense exhibits by letters. This minimizes possible confusion arising from referencing multiple exhibits from various litigants. The Court would be most obliged if Counsel followed this practice in futuro.
The foregoing constitutes the order of the Court. DATED: MAY 12, 2015
RIVERHEAD, NY
/s/_________
HON. JAMES HUDSON, A.J.S.C.