Summary
dismissing appellant's attempt to use a pending bankruptcy case as an excuse for failure to serve a complaint
Summary of this case from In re Grand Union Co.Opinion
October 3, 1990
John M. Clarke for New York Telephone Company, defendant.
William Kuntz, III, for plaintiffs.
Defendant, New York Telephone Company, moves for dismissal of plaintiffs' action, pursuant to CPLR 3012 (b), for plaintiffs' failure to serve a complaint on demand.
Plaintiffs commenced the instant action, seeking damages for breach of contract, breach of implied contract, restraint of trade and commerce, and R.I.C.O., by service of a summons on defendant New York Telephone Company on April 4, 1990. On April 20, 1990, defendant served plaintiffs with a demand for a complaint. Despite further inquiries by the defendant, plaintiffs have failed to serve a complaint in compliance with defendant's demand.
Plaintiffs contend that they are not obligated to serve a complaint in that defendant is precluded from moving to dismiss plaintiffs' action by the automatic stay in bankruptcy.
In 1988, plaintiff Drax Services, Ltd./Westrail filed for chapter 7 bankruptcy in the United States Bankruptcy Court for the District of Delaware. Plaintiff One Westminister Co., Inc. has apparently filed for chapter 11 reorganization. On March 29, 1990 plaintiffs filed a notice to creditors of automatic stay with the Albany County Clerk's office.
Contrary to plaintiffs' position, the automatic stay imposed by 11 U.S.C. § 362 (a) is inapplicable to suits by a bankrupt or debtor (see, Martin-Trigona v Champion Fed. Sav. Loan Assn., 892 F.2d 575; In re Berry Estates v State of New York, 812 F.2d 67), and does not bar a defendant in a debtor's suit from seeking dismissal of that suit (Martin-Trigona v Champion Fed. Sav. Loan Assn., supra).
Accordingly, for the foregoing reasons, defendant New York Telephone Company's motion to dismiss plaintiffs' action is granted.