Opinion
Index No. CV-324-21/CO
02-22-2022
Anthony H. RICCARDI, Plaintiff, v. YOUNG & YOUNG, LLP and Richard W. Young, Sr., Defendants.
Bartlett, Pontiff, Stewart & Rhodes, P.C. (Victoria M. Craft, Esq. of counsel) Glens Falls, NY for Plaintiff Young & Young, LLP (Vincent Grande, Esq. of counsel) Copiague, NY for Defendants
Bartlett, Pontiff, Stewart & Rhodes, P.C. (Victoria M. Craft, Esq. of counsel) Glens Falls, NY for Plaintiff
Young & Young, LLP (Vincent Grande, Esq. of counsel) Copiague, NY for Defendants
Thomas Marcelle, J. The facts of the case are simple; the resolution is not. Plaintiff Anthony Riccardi ("Riccardi") is an economist and actuary. In November 2019, Riccardi entered into an agreement with Richard Young and his law firm ("defendants") to provide them expert services in connection with litigation. Riccardi claims that defendants failed to pay him an outstanding balance of $ 9,219.98 and commenced this civil action to recover that sum. Defendants have moved to dismiss the Complaint, arguing that they are beyond the reach of the court's in personam jurisdiction. Defendants are physically located in Suffolk County, and they retained Riccardi for a claim that arose in Suffolk County, involving plaintiffs from Suffolk County and for a trial to be held in Suffolk County. Therefore, defendants argue that this case belongs in Suffolk County, not Albany County. This argument has some force.
Uniformed City Court Act § 404 delineates the boundaries of a city court's jurisdiction over a defendant not residing in the same county as the court. "The court may exercise personal jurisdiction over any non-resident of the county, in the same manner as if he were a resident of the county, if, in person or through an agent, he transacts any business within the city" ( UCCA 404 [a] [1] ). So, defendants raise the question of whether hiring an Albany County expert is transacting business in Albany County. The question is a close one and precedent is sparce.
To begin with, defendants make two categorical arguments. First, defendants note that they have never been physically present in Albany County. However, even when physical presence is lacking, evidence of a single transaction within the County may be sufficient to establish personal jurisdiction "so long as the defendants’ activities [in Albany County] were purposeful and there is a substantial relationship between the transaction and the claim asserted" ( Stardust Dance Prods., Ltd. v. Cruise Groups Intl., Inc. , 63 A.D.3d 1262, 1264, 881 N.Y.S.2d 192 [3d Dept. 2009] ). Next, defendants say their connection to Albany County was limited to contracting with Riccardi. It is true that "[t]he fact that a contract [was] made in [Albany County] does not by itself guarantee jurisdiction if other contacts are lacking, although it is always a factor to be considered" ( Siegel, NY Prac § 86, at 179 [6th ed]). Therefore, neither of defendants’ two initial arguments possess sufficient merit to dismiss the Complaint because there is no simple litmus test to resolve the transact business standard imposed by UCCA 404 (a) (1). Defendants do, however, fortify their argument. They cite a precedent (the only precedent either party cited to the court): Precision Built Fences, Inc. v. Montes , 12 Misc. 3d 42, 820 N.Y.S.2d 399 (App. Term, 2d Dept. 2006). In that case, defendants, homeowners in Putnam County, had solicited plaintiff, a contractor, in Westchester County, to install a fence for them in Putnam County. The homeowners developed the scope of work during several telephone conversations and emails with the Westchester County contractor. When things went bad, the contractor sued the Putnam County homeowners in a city court in Westchester County. The court ruled that the homeowners’ calls and emails with the contractor did not constitute transacting business in Westchester County.
The Precision Built Fences court's opinion seems well reasoned and correct. In that case, the homeowners did not engage the builders to talk about erecting a fence. Rather, the purpose of the homeowners’ transaction with the company was to construct a fence. Thus, where the fence was to be built (Putnam County) was where the business was to be transacted—sound logic.
In light of this precedent, defendants tried to squeeze the role of an expert to make it analogous to a construction company. Defendants argue that just like the homeowners in Precision Built, all they did was talk with and email Riccardi. Further, the product, Riccardi's testimony, was to be delivered in Suffolk County. Indeed, defendants emphasize that they retained Riccardi to testify and where he prepared and developed his expert testimony "was of little concern to the defendant[s]" (Grande Reply Affirmation at ¶ 5).
There is some surface appeal to this argument. However, the value of an expert lies not just with trial testimony. Pre-trial expert reports, data and opinions provide a foundation for damages and thereby create leverage to settle cases favorably. Talking about damages and strategizing about theories is the essence of legal practice. Here the ideas and information generated by plaintiff with the assistance and aid of defendants’ communications occurred in Albany County. Since plaintiff's expert services were produced in and consumed by defendants in Albany County, defendants transacted business in Albany County within the meaning of Uniform City Court Act § 404 [a] [1]. Therefore, defendants’ motion to dismiss upon the grounds that they argued in their papers is denied.
This holding does not end the matter. The court will address an issue not identified by the defendants. Normally, which issues are litigated in a case is the advocates’ role, not the court's. A court's role in litigation is to decide the issues raised and argued by the parties ( COMM 2006-C8 Walt Whitman Rd., LLC v. Income Star LLC , 46 Misc. 3d 893, 898, 1 N.Y.S.3d 877 [Sup. Ct., Suffolk County 2014] ). In this case, the court has meticulously hewed to this limiting principle. However, this principle has exceptions. One exception is constitutional constrains upon the court's jurisdiction ( State of NY ex rel. Aryai v. Skanska , 72 Misc. 3d 935, 950 n. 16, 151 N.Y.S.3d 808 [Sup. Ct., New York County 2021] ).
There exists a constitutional jurisdictional issue in this case. The New York State Constitution provides, in pertinent part: "[in] city courts outside the city of New York [, process] may be served and executed in any part of the county in which such courts are located or in any part of any adjoining county" ( NY Const, art VI, § 1 [c]). Given the constitutional limitation on its jurisdiction, the court will sua sponte review the issue of service of process.
Plaintiff filed an affidavit of service upon Richard Young and the law firm of Young & Young, LLP indicating the defendants were served at their offices in Suffolk County. To state the obvious, Suffolk and Albany Counties do not adjoin. Therefore, with respect to Richard Young, since he resides in Suffolk County and since service on him was made outside of Albany County, the service is constitutionally defective and cannot be remediated by any type of corrective service. The case against him is dismissed.
The analysis concerning the law firm of Young & Young tracks differently. Young & Young is a limited liability partnership ("LLP"). An LLP is a general partnership which acquires limited liability characteristics upon registration with the secretary of state ( Partnership Law § 121—1500 ). In exchange for this benefit, the LLP designates the secretary of state as its agent for service of process. Partnership Law § 121—109 allows "the secretary of state to receive such service [on behalf of the LLP], at the office of the department of state in the city of Albany."
So, the question is whether service upon an agent in Albany County satisfies the constitutional service mandate. In deciding this issue, the court begins by noting that Defendant Young & Young, LLP is not a person, but a fictional entity. An LLP "like a corporation, shields its members from liability and, once formed, is a legal entity distinct from its members" ( Leased v. Air Chef, Inc. , 2014 N.Y. Slip Op. 31592(U) at 2, 2014 WL 2859262 [Sup. Ct., New York County] ). Indeed, when a partnership is a registered limited liability partnership, [the LLP] is [ ] a legal entity separate and distinct from the partners therein" ( Id. at 3 ). Thus, an LLP is a statutory creature. It exists on papers and because of papers that reside with the secretary of state in Albany County. Therefore, the court holds that for corporation entities, like Defendant Young & Young, LLP, service of process on the secretary of state complies with NY Const, art VI, § 1 [c]).
This case should not be construed to opening the flood gates for litigation in Albany County. The holding is narrow. Only when a non-resident corporate entity transacts business within Albany County is it susceptible to personal jurisdiction in Albany County.
All that said, Defendant Young & Young, LLP still has not been served in Albany County. The court views this as a correctable technical defect—so technical that it was overlooked by defendants. Since this court has "all of the powers that the supreme court would have in like actions and proceedings" ( UCCA 212 ), pursuant to CPLR 2001, the court will allow plaintiff to serve process upon the secretary of state no later than March 9, 2022. If service is not completed by that time, the court will dismiss the Complaint.
ORDERED that defendants’ motion to dismiss the Complaint is granted with respect to Richard Young and is denied with respect to Young & Young, LLP.
The foregoing constitutes the Decision and Order of the Court.