Landauer Limited, Appellant,v.Joe Monani Fish Co., Inc., Respondent.BriefN.Y.January 16, 2014APL-2013-00103 Bronx County Clerk’s Index No. 260550/10 Court of Appeals STATE OF NEW YORK LANDAUER LIMITED, Plaintiff-Appellant, against JOE MONANI FISH CO., INC., Defendant-Respondent. >> >> BRIEF FOR DEFENDANT-RESPONDENT FOX ROTHSCHILD LLP Attorneys for Defendant-Respondent 100 Park Avenue South, Suite 1500 New York, New York 10017 212-878-7900 Date Completed: August 12, 2013 Of Counsel: N. Ari Weisbrot Oksana G. Wright To Be Argued By: N. Ari Weisbrot Time Requested: 30 Minutes i TABLE OF CONTENTS Page TABLE OF AUTHORITIES ................................................................................... iii DISCLOSURE STATEMENT PURSUANT TO 22 NYCRR 500.1(F) ................... 1 RESPONDENT’S BRIEF .......................................................................................... 1 PRELIMINARY STATEMENT/SUMMARY OF ARGUMENT ............................ 1 COUNTERSTATEMENT OF QUESTION PRESENTED ...................................... 8 STANDARD OF REVIEW ....................................................................................... 8 STATEMENT OF FACTS ........................................................................................ 9 Landauer’s “Bait and Switch” Scheme ............................................................... 9 Landauer’s Contradictory and Ambiguous Forum Selection Provisions .......................................................................................................... 10 Landauer’s Improper Service of Process .......................................................... 12 PROCEDURAL HEARING .................................................................................... 13 Traverse Hearing ............................................................................................... 14 POINT I THE COURTS BELOW CORRECTLY FOUND THAT LANDAUER FAILED TO PROPERLY SERVE MONANI .......................... 18 A. Evidence Introduced During The Traverse Hearing Support Lower Courts’ Holdings In Favor Of Monani ....................... 20 B. Cases Cited By Landauer Further Support The Lower Courts’ Holdings ................................................................................. 23 ii POINT II LANDAUER IMPROPERLY RAISES NEW ARGUMENTS ....................... 26 A. Landauer Is Improperly Relying On Alleged Facts That Were Never Introduced At The Traverse Hearing .............................. 26 Landauer’s Reliance on Emails Is Improper And Inadmissible ................................................................................. 28 Emails Are Inadmissible Hearsay ................................................. 31 November 23, 2010 Letter Is Not Part Of The Record ................ 35 B. The Lower Courts’ Decisions Are Consistent With Galliano ............................................................................................... 35 CONCLUSION ........................................................................................................ 40 iii TABLE OF AUTHORITIES Page Cases Arch-Built Container Corp. v. Interboro Mut. Indem. Ins. Co., 119 A.D.2d 713, 501 N.Y.S.2d 127 (2d Dep't 1986)........................................ 32 Arvanitis v. Bankers Trust Co., 286 A.D.2d 273, 729 N.Y.S.2d 706 (1st Dep't 2001) ................................................................................................. 23 Assured Guar. (UK) Ltd. v. J.P. Morgan Inv. Management Inc., 80 A.D.3d 293, 915 N.Y.S.2d 7 (1st Dep't 2010), aff'd, 2011 WL 6338898 (Dec. 20, 2011) .................................................................. 33 Barone v. Guthy, 295 A.D.2d 460, 744 N.Y.S.2d 673 (2d Dep't 2002) .................. 32 Cannon v Putnam, 76 NY2d 644 (1990) ............................................................. 8, 26 Carlin v. Crum & Forster Ins. Co., 170 A.D.2d 251 (1st Dep't 1991) .................... 27 Chase Home Finance LLC v. Adetula, 32 Misc.3d 1236(A), 938 N.Y.S.2d 225 (Table), 2011 WL 3684858 (Sup. Ct. Queens County Aug. 23, 2011) ......................................................... 19 Collini v. Turner Const. Co., 129 N.Y.S.2d 485 (Sup. Ct. Kings Co. 1954) ................................................................................. 24 Covillion v. Tri State Service Co., Inc., 48 A.D.3d 399, 851 N.Y.S.2d 645 (2d Dep't 2008) ................................................................... 20 CSC Holdings, Inc. v. Fung, 349 F. Supp. 2d 613 (E.D.N.Y. 2004) ....................... 20 Dime Sav. Bank of New York v. Steinman, 206 A.D.2d 404, 613 N.Y.S.2d 945 (2d Dep't 1994) ................................................................... 18 Dunn v. Pallett, 66 A.D.3d 1179, 889 N.Y.S.2d 682 (3d Dep't 2009) .................... 23 Fashion Page, Ltd. v. Zurich Ins. Co., 50 N.Y.2d 265, 428 N.Y.S.2d 890 (1980) .................................................................................. 23 iv Feinstein v. Bergner, 48 N.Y.2d 234, 422 N.Y.S.2d 356 (1979) ...................... 19, 28 Fleet Business Credit, LLC v. Michael P. Costelloe, Inc., 19 Misc.3d 29, 856 N.Y.S.2d 436 (N.Y. Sup. App. Term 2008) ..................... 37 Frankel v. Schilling, 149 A.D.2d 657, 540 N.Y.S.2d 469 (2d Dep't 1989) ...................................................................................... 18, 19, 28 Freud v. St. Agnes Cathedral School, 64 A.D.3d 678, 881 N.Y.S.2d 908 (2d Dep't 2009) ............................................................. 23, 27 Holmes v. K&M Jewelry, Inc., 94 A.D.2d 657, 462 N.Y.S.2d 218 (1st Dep't 1983) ................................................................................................. 21 Horton v. Smith, 51 N.Y.2d. 798, 433 N.Y.S.2d 92 (1980) .................................... 29 Hunt v. Bankers & Shippers Ins. Co., 50 N.Y.2d 938, 431 N.Y.S.2d 454 (1980) .................................................................................... 8 I.D.R.P., BVBA v. Worldwide Diamonds Group, Inc., 10 Misc. 3d 1064A, 814 N.Y.S.2d 561 (Sup. Ct. N.Y. Co. 2005) ................... 23 In re Bergstein v. Board of Education, 34 N.Y.2d 318, 357 N.Y.S.2d 465 (1974) .................................................................................. 32 Isaacson v. Karpe, 84 A.D.2d 868, 445 N.Y.S.2d 37 (3d Dep't 1981) ................... 29 John Galliano, S.A. v. Stallion, Inc., 15 N.Y.3d 75, 904 N.Y.S.2d 683 cert. denied, 131 S. Ct. 288 (2010) ............................................................. 35, 36 McGuirk v. Mugs Pub., 250 A.D.2d 824 (2d Dep't 1998) ....................................... 27 Morgan Servs. v Lavan Corp., 59 NY2d 796 (1983) .......................................... 8, 26 Ortiz v. Jamwant, 305 A.D.2d 477 (2d Dep't 2003) ................................................ 27 People v. Acomb, 87 A.D.2d 1, 450 N.Y.S.2d 632 (4th Dep't 1982) ...................... 32 People v. Caviness, 38 N.Y.2d 227, 379 N.Y.S.2d 695 (1975) .............................. 32 Property Clerk v. Seroda, 131 A.D.2d 289 (1st Dep't 1987) .................................. 33 v Salahuddin v. Coughlin, 781 F.2d 24 (2d Cir. 1986) .............................................. 33 Schultz v. Gershman, 68 A.D. 3d 426 (1st Dep't 2009) ........................................... 30 Skyline Agency v. Ambrose Coppotelli, 117 A.D.2d 135, 502 N.Y.S.2d 479 (2nd Dept. 1986) ................................................................. 19 State of Oklahoma v. LNP Realty Corp., 275 A.D.2d 773, 713 N.Y.S.2d 537 (2d Dep't 2000) ................................................................... 38 Stern v. Waldbaum, Inc., 234 A.D.2d 534, 651 N.Y.S.2d 187 (2d Dep't 1996) .................................................................................................. 31 Todaro v. Wales Chem. Co., 173 A.D.2d 696, 570 N.Y.S.2d 595 (2d Dep't 1991) .................................................................................................. 20 Wood v. Wood, 231 A.D.2d 713, 647 N.Y.S.2d 830 (2d Dep't 1996) ..................... 22 Yuppie Puppy Pet Prods. Inc. v. Street Smart Realty, LLC, 77 A.D.3d 197, 906 N.Y.S.2d 231 (1st Dep't 2010) ......................................... 33 Statutes CPLR § 311 .............................................................................................................. 25 CPLR § 3213 ............................................................................................................ 13 CPLR § 5501 .............................................................................................................. 8 CPLR § 5501(b) ......................................................................................................... 8 CPLR § 5303 ............................................................................................................ 13 N.Y.Const., art. VI, s 3, subd. a ................................................................................. 8 vi Other Authorities KARGER, THE POWERS OF THE NEW YORK COURT OF APPEALS, § 13.1, pp. 448-49 (3d ed., 2005) .................................................................................... 9 SIEGAL, PRACTICE COMMENTARIES, MCKINNEY’S CONS. LAW OF N.Y., Book 7B, CPLR 5501, C5501:9 (1995) .............................................................. 8 1 DISCLOSURE STATEMENT PURSUANT TO 22 NYCRR 500.1(f) Defendant-Respondent Joe Monani Fish Co., Inc. states that it has no corporate parents, subsidiaries or affiliates. RESPONDENT’S BRIEF Defendant-respondent Joe Monani Fish Co., Inc. (“Monani”) respectfully submits this brief in opposition to plaintiff-appellant’s Landauer Limited’s (“Landauer”) appeal of the First Department’s December 27, 2012 Decision affirming the IAS Court’s (Barbato, J.) order, dated November 9, 2011 and entered on November 17, 2011 (the “Order”), which denied Landauer’s motion for summary judgment in lieu of complaint and dismissed this action without prejudice on the ground that jurisdiction was not obtained over Monani. 1 PRELIMINARY STATEMENT/SUMMARY OF ARGUMENT As much as Landauer would like this Court to believe that its appeal implicates the question of whether Monani had “actual” or “constructive” notice of its English lawsuit, in fact, the question to be decided on appeal is far more narrow. There are no questions of law to be determined by this court; the legal standards are well-established. Instead, this Court is only called upon to make a determination of fact: was Monani properly served with process relating to the 1 Landauer incorrectly states in its Preliminary Statement that the Order merely “denied, without prejudice, Plaintiff’s motion for summary judgment in lieu of complaint. . .” (App. Br. at 1). 2 English proceeding? Yet, the trier of fact and then the appellate division already considered and answered that question in the negative. At the Traverse hearing, the only evidence brought forth by Landauer was the testimony of its process servers, who admitted that they dropped the papers on a desk where an unidentified individual, with unidentified authority, was seated. (R. 286; 267-8; 289; 307-8). The process servers admitted that they did not inquire as to the authority to accept service, they admitted that their affidavits of service were replete with false statements, inaccurate information, and defective process. Id. The admitted false affidavits, in which the process servers claimed that the person seated at the desk acknowledged that he was authorized to accept service, singularly demonstrates the defects in service. The process servers testified at the Traverse hearing that their sworn affidavits were false and that no one ever acknowledged that they were authorized to accept service. (R. 286; 267-8; 289; 307-8). It seems impossible that a party can submit knowingly falsified affidavits of service (to conceal the impropriety in service) but then claim that service was proper. But, these misrepresentations did not end at the Traverse hearing. As set forth below, Landauer has front-loaded their instant Appellant papers with gross mischaracterizations of the record below and “creative” editing of the underlying documents. 3 Landauer’s argument is reduced to this: this Court should ignore the clearly defective service, should ignore the un-refuted testimony of Monani’s principal (credited by the trier of fact) that he did not know about the English proceeding until after judgment was entered, ignore the undisputed fact that the English civil proceeding was commenced by Landauer despite a clear arbitration provision and despite the fact that the contractual time period for filing such claims had long expired and, instead, impose liability because of an ambiguous e-mail exchange between counsel (not counsel of record in the English proceeding) that could be interpreted as meaning that Monani knew about the English proceedings at some point before Judgment was entered. (Though it also could be interpreted differently). The only evidence and testimony before the court adduced by Landauer was the testimony of the principal of Monani that he was not aware of the English proceedings before judgment was entered. (R. 313-4). The testimony went unchallenged by Appellant who, instead, tried to introduce hearsay and inadmissible emails between two lawyers as evidence of Monani’s actual knowledge. Id. One participant in the email exchange was seated in the courtroom, but they declined to call him to the stand. The second participant works for Landauer’s law firm but they declined to call him to the stand. Without that testimony, the email exchange is inadmissible and may not be considered by 4 the court. But, even if it had some evidentiary value, the contents of those emails are ambiguous and could easily have been explained as not resulting in Monani’s actual knowledge. Importantly, the trial court had the emails in its possession. Based on the parties’ submissions - - including the ambiguous, inadmissible emails - - it scheduled a Traverse hearing - - which was Landauer’s opportunity to establish service of process. (R. 255). Yet, it failed to do so, as determined by the trial court and the First Department. Landauer’s appeal raises new arguments for this first time before this Court. For example, Landauer claims that the enforcement of the English judgment is not repugnant to New York’s notice of fairness. Yet, Landauer ignores the fact that the same “invoice” that permits English jurisdiction requires arbitration and prohibits civil proceedings. (R. 213-4). Worse yet, Landauer was time-barred from seeking arbitration - - pursuant to its invoices - - rendering its claims against Monani “forever waived.” Thus, Landauer enthusiastically demands compliance with the jurisdictional provision of the invoices, while brazenly defying the arbitration clause and contractual time limitations. Equally, much is made of the English venue printed on the back of the invoices but, in reality, Monani never received the backs of those invoices. (R. 239, 312). Landauer sent photocopies of the fronts of the invoices and Monani 5 never saw nor agreed to the venue provisions. Stated differently, Landauer argues that “respondent agreed to English law and jurisdiction” without ever establishing that fact before the trial court. To the contrary, the only evidence adduced at the Traverse hearing was that Monani did not agree to litigate in England. (R. 312). Landauer takes some liberties with the facts. For example, Landauer repeatedly refers to N. Ari Weisbrot as “Respondent’s counsel of record” in the context of the emails. Yet, it is just not true. There were no pending proceedings in the United States. Mr. Weisbrot could not have been counsel of record in the English proceedings - - he is not a member of the English Bar. Another example: the cited email never confirms that Monani was aware of the details of the communications between counsel. In fact, one email from Mr. Weisbrot points out his “belief” as to what Monani might do. (R. 239). Yet, Landauer’s brief cites that language as proof positive that, at that point, Monani had actual knowledge of the English lawsuit. Amazingly, later in Appellant’s brief Landauer omits the phrase “I believe,” and simply (but continuously) misquotes “we will allow your London lawsuit to proceed” making it appear as though counsel’s musings were definitive and not merely his “belief.” The distortion of the record, and selective quotations, forms the basis of all of Landauer’s arguments. 6 Further, Monani’s principal testified that he first learned of the English lawsuit when he returned from vacation and saw the “judgment papers.” (R. 313). Landauer cites to that testimony as proof that Monani’s principal received service of process before the judgment was entered. Thus, Landauer argues that “he saw the papers upon his return from a trip,” but intentionally omits what “papers” he saw - - the judgment papers. These facts, while fatal to Landauer’s application are more significant because they confirm the ongoing chicanery offered to the Court by Landauer in support of its appeal. Similarly, in this appeal, Landauer offers documents that were not part of the record below (specifically, a letter from Monani’s counsel to Judge Edgar Walker) and, in fact, were affirmatively excluded from the Record by the Appellate Division. Putting that aside, the letter to Judge Walker is, once again, utterly misrepresented by Landauer. That letter merely clarifies that Landauer learned of the English lawsuit in May or June of 2009. (Judgment was entered in June 2009) - - thus counsel’s letter does not actually confirm actual knowledge of any knowledge of the English proceeding before judgment because it could easily have been in June 2009 – after the judgment. Although it “appears” Monani may have become aware of the action before judgment was entered, it can hardly be confirmed via the letter to Judge Walker. But, here is how Landauer presents these fact in the instant appeal (App Br. 13): 7 The letter addressed to Judge Edgar Walker. . .specifically states that “Monani actually became aware of the English Court action before” default was entered. (emphasis added, but the language after the quote comes from Appellant’s brief and is a misrepresentation of the letter). Here is the actual sentence from the subject letter (R. 394-5): Monani actually became aware of the English Court action before [August 10, 2010]. I believe I advised Monani of the existence of the English Court action sometime in May or June of 2009. Judgment was entered in June 2009 - - thus the quoted sentence might mean Monani had knowledge of the English action before judgment or it might mean he found out after judgment had been entered in England. Finally, Landauer’s legal analysis is flawed. The reliance on Galliano is a red-herring. No one disputes that a foreign judgment should be enforced if the process was “fundamentally fair” and if Monani “received notice of the foreign court proceedings.” Yet, those “conditions” are at the very heart of this dispute and, the record has established that the process was fundamentally unfair and the evidence has not established that Monani received notice of the foreign court proceedings. Importantly, how could the trial or appellate courts have reached the conclusion that process was properly served or that Monani had notice of the 8 English proceeding? There was simply no testimony or documentary evidence that would establish - - to the standard required by law – proper service. COUNTERSTATEMENT OF QUESTION PRESENTED Whether the First Department correctly affirmed the IAS Court’s holding that Landauer failed to meet its burden of proof and to establish proper service of the English Action papers on Monani? STANDARD OF REVIEW The Court of Appeals’ jurisdiction is generally limited to questions of law and, except in limited circumstances, the Court is precluded from a review of questions of fact. See CPLR 5501(b); see also Hunt v. Bankers & Shippers Ins. Co., 50 N.Y.2d 938, 940, 431 N.Y.S.2d 454, 455 (1980) (“Our appellate jurisdiction is ordinary limited to consideration of issues of law…”). Findings of fact that are affirmed by the Appellate Division are only reviewable to determine if there is evidence in the record to support them. See e.g. Cannon v Putnam, 76 NY2d 644, 651 (1990); Morgan Servs. v Lavan Corp., 59 NY2d 796, 797 (1983). In civil cases, the court is empowered to review the facts only when the Appellate Division has reversed or modified a final or interlocutory determination and made new findings of fact and a final determination has been entered. See N.Y.Const., art. VI, s 3, subd. a; CPLR 5501(b); see also SIEGAL, PRACTICE COMMENTARIES, MCKINNEY’S CONS. LAW OF N.Y., Book 7B, CPLR 5501, 9 C5501:9 (1995); see also KARGER, THE POWERS OF THE NEW YORK COURT OF APPEALS, § 13.1, pp. 448-49 (3d ed., 2005). STATEMENT OF FACTS 2 Landauer’s “Bait and Switch” Scheme Monani is a wholesale seafood dealer, and Landauer is in the business of selling frozen seafood. (R. 211; 306). Monani purchased various frozen seafood from Landauer periodically between 2004 and 2008. Id. While certain of the goods Monani ordered from Landauer were of acceptable quality, in or around 2007, Landauer started engaging in a “bait and switch” scheme, in which it provided excellent seafood to Monani as “samples,” but then actually delivered vastly inferior goods after Monani had placed the orders. (R. 211-212). Typically, when such a fraudulent scheme occurs in the fish market, the seafood received is still saleable in a secondary market, although at substantially lower prices. (R. 212). The seafood Monani received from Landauer, however, was of such poor quality that it was not saleable at all, even on the secondary market, and it all had to be thrown out. Id. 2 Monani contends that this Court’s review should be limited to the question of whether Landauer established in the IAS Court, in the course of the Traverse hearing, through admissible evidence, that Monani had notice of the English Action. However, in light of Landauer’s erroneous statements, Monani believes that it is necessary to provide this Court with background information about the parties relationship and other circumstances that led to this action. 10 Monani advised Stephen Brown, principal of Landauer, of the substandard quality of the seafood -- a fact confirmed by Landauer’s New Jersey-based employee, Clyde Worthen. (R. 212). Mr. Worthen inspected the containers of seafood, confirmed that the seafood was worthless, and advised Mr. Brown of that fact. Id. Landauer advised Monani that he did not have to pay for the inedible seafood and that it would be replaced. Id. Accordingly, Monani never paid for the seafood. Id. Landauer’s Contradictory and Ambiguous Forum Selection Provisions Unknown to Monani, there was a buried provision set forth on the back of certain invoices that mentioned that “the Courts of England or Arbitrators in England, as the case may be, shall have exclusive jurisdiction of all disputes which may arise out of this contract.” (R. 214, 312). Landauer sent to Monani the photocopies of the fronts of the invoices and Monani never saw nor agreed to the forum selection provision. (R. 239, 312). Monani conducts no business in England, has no presence in England and has never had bank accounts, agents or property in England. (R. 214; 312) Furthermore, the ambiguous invoices also required the arbitration of any dispute between the parties. (R. 213-214). 11 The arbitration provision states: ARBITRATION – Any dispute whatsoever which cannot be settled privately arising out of, or in relation to, this contract or its construction of [sic.] fulfillment shall be referred to arbitration in London under the English Arbitration Acts currently in force. There shall be three arbitrators. Each party shall appoint their own arbitrator and the two appointed arbitrators shall appoint a third arbitrator. The arbitrators shall be actively and currently engaged in the trade. Notice of any claim for arbitration must be made, the Claimant’s arbitrator appointed and notice thereof received by the other party within six months from the date of final discharge, failing which the claim shall be deemed to be waived and absolutely barred and no claim for arbitration shall thereafter be made. (R. 86). Landauer and Monani never had any discussions limiting the application of this provision in any way. (R. 214). Monani had no intention of waiving its right to arbitrate, and never instructed its attorney to waive Monani’s right to arbitrate. Id. 3 3 Monani would have defended the English Action on the ground that he never received the back of the invoices where the ambiguous forum selection clause was located. Further, Landauer’s claim was time-barred pursuant to the provision in the arbitration clause between the parties that states: “Notice of any claim for arbitration must be made, the Claimant’s arbitrator appointed and notice thereof received by the other party within six months from the date of final discharge, failing which the claim shall be deemed to be waived and absolutely barred and no claim for arbitration shall thereafter be made.” (R. 214-215). The “date of final discharge” was more than six months prior to the institution of the English Action. (R. 215). Thus, pursuant to the parties’ agreement, Landauer’s claim was “waived and absolutely barred” before it ever filed its English lawsuit. 12 Landauer’s Improper Service of Process Landauer filed a lawsuit in England seeking to recover the cost of the sub- standard seafood. (R. 39-44). As found by the IAS Court and unanimously affirmed by the First Department, Landauer failed to properly serve Monani with papers filed in England. (R. x-xii). Although Landauer purportedly served a copy of the Order, Particulars of Claim and Claim Form for Landauer’s proceedings in the English Action upon Monani by personal delivery on May 13, 2009, the person upon whom service was purportedly made, Cesar Cardenas, did not recall receiving the papers. (R. 266). Mr. Cardenas is not authorized to accept legal service of process on Monani’s behalf. (R. 270, 309). Moreover, as found by the IAS Court and affirmed by the First Department, Landauer’s process server and process server’s father “testified that upon arriving at [the fish market building] and not locating [Monani’s] name in the directory, they were directed by an individual who was mopping the floor to a particular office said to belong to [Monani].” (R. x-xi); see also (R. 277; 293). There are about 25 wholesale seafood companies that are located in the building. (R. 308). “Although the door to the office did not bear Monani’s name, the process servers nonetheless delivered a copy of the papers to the only individual present in the office, without specifically asking the person if he was employed by defendant or 13 authorized to receive service on defendant’s behalf.” (R. x-xi); see also (R. 300) (“There’s no name on the door”); (R. 288; 304-305). Landauer purportedly served the judgment in the English Court proceedings upon a person named “Auturo Aponte,” on behalf of Monani. (R. 24). Monani has never employed anyone by the name of Auturo Aponte, nor is anyone by the name of Auturo Aponte authorized to accept service on behalf of Monani. (R. 215, 309- 311). Again, the same process server did not bother to ask Auturo Aponte whether he is authorized to receive service on behalf of Monani. (R. 292). PROCEDURAL HEARING Landauer brought this case by a motion for summary judgment in lieu of complaint to enforce a default judgment it had obtained against Monani in the English Court proceeding (the “English Action”). The IAS Court properly considered all evidence submitted in support of and in opposition to the summary judgment motion, and issued a Decision/Order on March 4, 2011 (the “March Order”). (R. 255). The evidence considered by the IAS Court included Landauer’s purported emails between Mr. Weisbrot and Mr. Preston which Landauer only submitted to Court in its reply papers. (R. 221). The March Order recited the papers upon which its decision was based and stated “the Plaintiff’s motion for an Order granting summary judgment in lieu of Complaint pursuant to CPLR §§ 3213 and 5303 is decided as follow[s]: The above matter is set down for 14 a Traverse Hearing on May 4, 2011 . . .” (R. 255) The Traverse hearing took place as scheduled on May 4, 2011. (R. 261). Traverse Hearing At the Traverse hearing, the testimony established that the process server had not properly served process upon Monani. (R. 261-316). The process server testified that he never asked Mr. Cardenas, who purportedly was served with the English Action papers, whether he was authorized to accept service, and that Mr. Cardenas never said he was so authorized. (R. 288). The process server further testified that he never asked Mr. Aponte, who was purportedly served with the English Action judgment, whether he was authorized to accept service, and Mr. Aponte never told him he was so authorized. (R. 292). Indeed, the process server never even asked Mr. Aponte whether he was employed by Monani. Id. The testimony at the Traverse hearing further established that the affidavits of service contained multiple falsehoods. First, the original affidavit of service upon Mr. Cardenas stated that the date it was notarized was “this 2 nd day of FEBRUARY 2009,” although the service date was “the 13 th day of MAY 2009.” (R. 45). At the Traverse hearing, the process server testified that the date was a mistake. (R. 286). The affidavit of service upon Mr. Cardenas falsely stated that he was the “COMPTROLLER” of Monani (R. 45), but both Mr. Cardenas and Mr. Monani testified that he was not Monani’s Comptroller. (R. 267-268, 307-308). 15 Finally, both the affidavit of service upon Mr. Cardenas and the affidavit of service upon Mr. Aponte provided that the person served “stated that he is the said individual to be Authorized To Accept Service thereof,” (see R. 24, 45). However, the process server testified that neither Mr. Cardenas nor Mr. Aponte ever stated that they were authorized to accept service. (R. 288, 292). In fact, the process server during the Traverse hearing admitted that he “mistakenly” wrote in his affidavits of service that both Cardenas and Aponte stated to him that they are authorized to accept service on behalf of Monani. (R. 289). Finally, contrary to Landauer’s claims, Mr. Monani, Monani’s President and sole shareholder, never testified that he received the English Action “papers” before the judgment was entered. (R. 313) (testifying that he returned from vacation or some kind of business trip and found the judgment papers on his desk). After the Traverse hearing, the Court issued its Order, finding that, inter alia: During both service dates, Mr. Cagney [Landauer’s process server] testified that he never asked Mr. Cardenas [the person who purportedly was “served” with the initial papers in the English Action] or Mr. Aponte [the person who was purportedly “served” with the default judgment in the English Action] whether they were authorized to accept service on behalf of Joe Monani Fish Company nor was he ever told explicitly that they could do so. However, his Affidavits of Service of May 13, 2009 and September 4, 2009 indicate that Mr. Cardenas and Mr. 16 Aponte stated that they were individuals authorized to accept service. Furthermore, Mr. Cagney testified that he did not ask Mr. Aponte if he was employed by the Defendant corporation. (R. 7). Landauer does not assert that the Court’s description of its process server’s testimony was inaccurate. Nor could Landauer do so, since the Court’s findings are supported by the transcript. Moreover, at the hearing, Landauer failed to adduce any evidence showing any kind of Monani’s “actual” notice. Landauer did not authenticate or attempt to admit in evidence the invoices, nor did Landauer attempt to show that Monani, in fact, received the backs of the invoices with questionable forum selection clause. (R. 261-316). Landauer’s argument is primarily based upon ambiguous hearsay e-mails regarding the English Action between Andrew Preston, counsel for Landauer, and Ari Weisbrot, Monani’s counsel in this action (the “E-mails”), that Landauer improperly submitted for the first time in its reply papers on the summary judgment motion and did not introduce into evidence at the Traverse hearing. However, at the Traverse hearing Landauer did not call Mr. Weisbrot (who was sitting in the Courtroom!) and did not ask him in what capacity he was speaking, whether he had been engaged to represent Monani in this action (which, of course, did not, at the time exist, except in England, where Mr. Weisbrot is not a lawyer), or whether he agreed to accept service on Monani’s behalf. 17 Nor did Landauer call Mr. Preston, a partner in the London office of the same law firm that represented Landauer before the IAS Court and in this appeal, to testify at the Traverse hearing to authenticate, explain, or introduce the E-mails. Amazingly, Landauer now explains its failure to address the emails earlier by claiming that “Landauer had no reason to anticipate that Monani would deny that service was made. . . or that Monani would assert that it did not have notice of the English Action.” (App. Brief., page 19). But, Landauer admits that it received Monani’s opposition to summary judgment, on October 11, 2010, which included affidavits from Mr. Monani and Mr. Cardenas that specifically denied service and denied knowledge of the English Action. (R. 211-219). The Traverse hearing was held seven months later. Certainly, Landauer knew well in advance of the Traverse hearing that service and notice would dominate the proceeding. Why did they decline to call the authors of the e-mails? Why did they decline to make any argument as to the admissibility of the e-mails? When Landauer’s counsel attempted to admit the emails, an objection was made. Landauer’s counsel next statement? “I have no further questions.” (R. 315). No argument was offered as to the inadmissibility of the e-mails. How can Landauer now be heard to argue the admissibility of the e-mails when it declined to do so at the Traverse hearing? In other words, despite seven months to prepare for the Traverse hearing, Landauer made no effort whatsoever to introduce the e-mails, to explain them through live 18 testimony, or to argue their admissibility. While the omissions are fatal, the reality is Landauer understood that live testimony about the e-mails would have disproven the argument of actual knowledge and it also understood that the e-mails were inadmissible. Following the Traverse hearing held on May 4, 2011 to determine whether service was effected upon Monani, the IAS Court denied Landauer’s motion for summary judgment in lieu of complaint and dismissed the action without prejudice. (R. 6-8). On December 27, 2010, the First Department unanimously affirmed the IAS Court’s Order. (R. x-xii). POINT I THE COURTS BELOW CORRECTLY FOUND THAT LANDAUER FAILED TO PROPERLY SERVE MONANI Notwithstanding Landauer’s claims, 4 it is well-established that Landauer had the burden of proving by a preponderance of the evidence at the Traverse hearing that the service upon Monani was proper. See Dime Sav. Bank of New York v. Steinman, 206 A.D.2d 404, 613 N.Y.S.2d 945 (2d Dep’t 1994); Frankel v. Schilling, 149 A.D.2d 657, 659, 540 N.Y.S.2d 469, 471 (2d Dep’t 1989) (where the affidavit of service is rebutted, plaintiff must establish jurisdiction by a preponderance of the evidence at a Traverse hearing; “[a]ctual notice alone will 4 See e.g. App. Br. 20 where Landauer argues that there is “no legal support” that it had the obligation to introduce evidence of alleged service or notice (i.e. emails) at the Traverse hearing. 19 not sustain the service or subject a person to the court’s jurisdiction when there has not been compliance with prescribed conditions of service”) (citations omitted); Skyline Agency v. Ambrose Coppotelli, 117 A.D.2d 135, 502 N.Y.S.2d 479 (2nd Dept. 1986) (same); Chase Home Finance LLC v. Adetula, 32 Misc.3d 1236(A), 938 N.Y.S.2d 225 (Table), 2011 WL 3684858, *2 (Sup. Ct. Queens County Aug. 23, 2011) (“Since defendant [] has raised a genuine question on the issue whether service was properly effected in accordance with the statute, the plaintiff must establish that the Court has jurisdiction over defendant [] by a preponderance of evidence at a hearing”). As found by the IAS Court and the First Department, Landauer failed to meet his burden of proof. Moreover, contrary to Landauer’s contentions, mere notice of a lawsuit cannot cure defective service “since notice received by means other than those authorized by statute cannot serve to bring a defendant within the jurisdiction of the court.” Feinstein v. Bergner, 48 N.Y.2d 234, 241, 422 N.Y.S.2d 356, 359-60 (1979) (affirming Appellate Division’s grant of defendant’s motion to dismiss for lack of personal jurisdiction due to inadequate service, although defendant concededly had actual notice of the action); Frankel v. Schilling, 149 A.D.2d 657, 659 (1st Dep’t 1989) (finding that “while the defendant eventually acquired actual notice of the lawsuit, actual notice alone will not sustain the service or subject a person to the court's jurisdiction when there has not been compliance with 20 prescribed conditions of service.”) (emphasis added); see also CSC Holdings, Inc. v. Fung, 349 F. Supp. 2d 613, 616 (E.D.N.Y. 2004). A. Evidence Introduced During The Traverse Hearing Support Lower Courts’ Holdings In Favor Of Monani During the Traverse hearing, Landauer failed to establish that his process server effectuated the proper service upon Monani. The person purportedly served, Mr. Cardenas, does not recall receiving the papers. (R. 266). Even if he did receive the papers, however, service would have been improper because Mr. Cardenas is not an officer, director, managing or general agent or cashier or assistant cashier of Monani, nor was he authorized by appointment or law to accept service. (R. 213, 219, 268-270, 309-310). See Covillion v. Tri State Service Co., Inc., 48 A.D.3d 399, 851 N.Y.S.2d 645 (2d Dep’t 2008) (service upon customer service representative employed by corporate defendant was ineffective because the representative was not an officer, director, managing agent or cashier of the defendant, and she testified that she was not authorized to accept service of process on behalf of the defendant); Todaro v. Wales Chem. Co., 173 A.D.2d 696, 570 N.Y.S.2d 595 (2d Dep’t 1991) (service upon manufacturing clerk and relief switchboard operator employed by corporate defendant was insufficient). 21 In its brief, Landauer does not disagree that the purported service of the default judgment in the English Action was also deficient. During the Traverse hearing Landauer submitted an affidavit of service that states that the deponent attempted to serve a Default Judgment Entered in English High Court Against Monani Fish Co., Inc., an Order of the English High Court Granting Landauer Ltd. the right to serve the default judgment in the USA and a Draft of Landauer’s Application for Costs and Intrest [sic.] in the English Action “by delivering thereat a true copy to AUTURO APONTE (MANAGER) personally; who stated that he is the said individual to be Authorized to Accept Service thereof.” (R. 24). However, Monani has never employed anyone by the name of Auturo Aponte, nor was anyone by the name of Auturo Aponte authorized to accept service on behalf of Monani. (R. 215, 309-311). Thus, such “service” upon Mr. Aponte was plainly invalid. See Holmes v. K&M Jewelry, Inc., 94 A.D.2d 657, 462 N.Y.S.2d 218 (1st Dep’t 1983) (service invalid where president of defendant corporation testified that during the relevant period the defendant did not employ anyone by the name of the person who purportedly received the summons and complaint). As a result, the affidavit of service is inaccurate and false. Similarly, as established at the Traverse hearing, the affidavit of the alleged service upon Mr. Cardenas is replete with inconsistencies and false statements. (R. 45; 286; 267-268; 307-308) 22 First, the original affidavit of service upon Mr. Cardenas stated that the date it was notarized was “this 2 nd day of FEBRUARY 2009,” although the service date was “the 13 th day of MAY 2009.” (R. 45). At the Traverse hearing, the process server testified that the date was a mistake. (R. 286). The affidavit of service upon Mr. Cardenas falsely stated that he was the “COMPTROLLER” of Monani (R. 45), but both Mr. Cardenas and Mr. Monani testified that he was never Monani’s Comptroller. (R. 267-268, 307-308). Finally, as the case with the affidavit of service upon Mr. Aponte, the affidavit of alleged service upon Mr. Cardenas provided that the person served “stated that he is the said individual to be Authorized To Accept Service thereof,” (see R. 24, 45). However, the process server during the Traverse hearing admitted that he mistakenly wrote in his affidavits of service that both Cardenas and Aponte stated to him that they are authorized to accept service on behalf of Monani. (R. 289). It is well-established in New York that “a judgment against a defendant is void if the defendant has not been properly served …” Wood v. Wood, 231 A.D.2d 713, 714, 647 N.Y.S.2d 830, 831 (2d Dep’t 1996). Accordingly, this Court should uphold the First Department’s Order that did not recognize the English Court’s default judgment because the English Court did not have personal jurisdiction over Monani, and because Monani did not receive notice of the English lawsuit (or of the English default judgment) in sufficient time to enable it to defend it. See 23 I.D.R.P., BVBA v. Worldwide Diamonds Group, Inc., 10 Misc. 3d 1064A, 814 N.Y.S.2d 561 (Sup. Ct. N.Y. Co. 2005) (holding Belgium judgment was not conclusive because the Belgium court lacked personal jurisdiction over the defendant where the defendant was not properly served under the Hague Convention). In light of the above, Landauer failed to carry its burden at the Traverse hearing. Thus, the IAS Court and the First Department’s holdings that Monani was never properly served were correct. B. Cases Cited By Landauer Further Support The Lower Courts’ Holdings To support its position Landauer cites to the same case law it cited in its previous brief in the First Department (App. Br. 29-31). However, as already found by the Appellate Court, none of the cases cited by Landauer in its briefs support its position that the service of process upon Monani was proper. In each and every case cited by Landauer, the person who was served on behalf of the corporate defendant had advised the process server that he or she was authorized to accept service. See Fashion Page, Ltd. v. Zurich Ins. Co., 50 N.Y.2d 265, 428 N.Y.S.2d 890 (1980); Dunn v. Pallett, 66 A.D.3d 1179, 889 N.Y.S.2d 682 (3d Dep’t 2009); Freud v. St. Agnes Cathedral School, 64 A.D.3d 678, 881 N.Y.S.2d 908 (2d Dep’t 2009); Arvanitis v. Bankers Trust Co., 286 A.D.2d 273, 729 24 N.Y.S.2d 706 (1 st Dep’t 2001); Collini v. Turner Const. Co., 129 N.Y.S.2d 485 (Sup. Ct. Kings Co. 1954). By contrast, the process server who allegedly served Mr. Cardenas testified as follows: Q: And you testified earlier today that you never actually asked Mr. Cardenas whether he was authorized to accept service, isn’t that right? A: That’s correct. Q: And he never actually told you he was authorized to accept service, isn’t that correct? A: Right, but the fact that he accepted service and gave me his name and title implied that he had the authority to accept service. (R. 288). The process server’s father, who accompanied him to Monani’s office, corroborated his testimony. (R. 305). Since Landauer’s own witnesses testified that Mr. Cardenas never said that he was authorized to accept service on behalf of Monani, Landauer’s citations to Fashion Pages, Arbitron, Dunn, Freud, Arvanitis, and Collini are all unavailing. Moreover, unlike the cited authority, the process server did not even make sure that the person to whom he gave the papers is even employed by Monani. (R. 292). As found by the First Department, “under the circumstances, plaintiff’s process servers did not have a reasonable basis for believing that the individuals served were authorized to accept service of process on defendant’s behalf.” (R. xi) (citing Fashion Page and Arvantis, among other cases). 25 Landauer argues that it was a mere “technical failure” that the process server never asked Mr. Cardenas or Mr. Aponte whether they are authorized to accept service on behalf of Monani or whether they are employed by Monani; left papers with Aponte who was never employed by Monani; and later falsely stated in his affidavit that both Mr. Cardenas and Mr. Aponte told him that they are employed by Monani and are authorized to accept service on its behalf. (App. Br. at 32). If a process server could simply leave the papers with whomever he wished at an office, then the amount of erroneous defaults would increase exponentially, as it is highly unlikely that “drop and run” service, such as the “service” by Landauer herein, would result in the summons and complaint arriving in the hands of the right person at the defendant’s offices. Landauer’s argument that the IAS Court improperly and strictly interpreted CPLR 311 (id.) is simply untrue. The IAS Court found that Landauer failed to serve process on an “officer, director, managing or general agent or cashier or assistant cashier or . . . any other agent authorized by appointment or law” as required by CPLR 311. (R. 8). The IAS Court considered all evidence in the record and found that service was improperly made because the process server “never asked Mr. Cardenas or Mr. Aponte whether they were authorized to accept service on behalf of Joe Monani Fish Company nor was he ever told explicitly that they could do so.” (R. 7). Although Landauer claims that “[t]he lower court’s 26 decision was clearly erroneous in light of the Record evidence that Monani was served” (App. Br. 14), there is no evidence in the Record that Monani was served properly in accordance with CPLR. POINT II LANDAUER IMPROPERLY RAISES NEW ARGUMENTS A. Landauer Is Improperly Relying On Alleged Facts That Were Never Introduced At The Traverse Hearing Findings of fact that are affirmed by the Appellate Division, as here, are only reviewable by this Court to determine if there is evidence in the record to support them. See e.g. Cannon v Putnam, 76 NY2d 644, 651 (1990); Morgan Servs. v Lavan Corp., 59 NY2d 796, 797 (1983). Yet, Landauer asks the Court to find the new facts that it failed to introduce during the Traverse hearing when it was Landauer’s burden to prove the proper service on Monani. At the Traverse hearing, Landauer never introduced any evidence of Monani’s alleged “actual” notice of the English proceeding. Landauer never authenticated or introduced the backs of the invoices or proved that Monani ever received or consented to the forum selection clause or waived his right to arbitrate. Perhaps, Landauer failed to do so because it could not prove that Monani ever received the backs of the invoices that contained the purported forum selection clause or explain to the Court why the same “invoice” permits English courts’ 27 jurisdiction and, at the same time, requires arbitration and prohibits civil court proceedings. Although Landauer argues that Monani agreed to English law and jurisdiction (App. Br. 4), it failed to establish this alleged fact in the IAS Court. In fact, in relation to Monani’s alleged “actual” notice, the only evidence and testimony before the Court adduced by Landauer was the testimony of Monani’s principal who testified that he was not aware of the English proceeding before the judgment was entered. (R. 312). It is well-settled that the hearing court’s assessment of a witness’s credibility is entitled to substantial deference. See Ortiz v. Jamwant, 305 A.D.2d 477 (2d Dep’t 2003) (“Issues of credibility are generally for the hearing court and should not be disturbed if supported by a fair interpretation of the evidence”); McGuirk v. Mugs Pub., 250 A.D.2d 824, 825 (2d Dep’t 1998) (“The hearing court's assessment of a witness's credibility is ordinarily entitled to substantial deference”); Carlin v. Crum & Forster Ins. Co., 170 A.D.2d 251 (1 st Dep’t 1991) (“To the extent that the defendants challenge the credibility findings of a Special Referee and IAS court, we note that these findings are substantiated by the record and should not be disturbed”); Freud, 64 A.D.3d 678, 881 N.Y.S.2d 908. The IAS Court clearly 28 found Mr. Monani’s denial credible, and this Court should not disturb the IAS Court’s holding in that regard. 5 Landauer’s Reliance on Emails Is Improper And Inadmissible Landauer did not controvert Edward Monani’s testimony but, instead, tried to introduce hearsay and inadmissible e-mails exchanged between two attorneys, Mr. Weisbrot 6 and Mr. Preston, as evidence of Monani’s “actual” knowledge of the English proceeding. As an initial matter, as already discussed above, mere notice of a lawsuit cannot cure defective service “since notice received by means other than those authorized by statute cannot serve to bring a defendant within the jurisdiction of the court.” Feinstein , 48 N.Y.2d at 241; Frankel, 149 A.D.2d at 659. Here, as correctly found by the lower courts, Landauer never met his burden of proof and established that Monani was properly served. Moreover, Landauer’s counsel never made an attempt to introduce the E- mail itself. Instead, she attempted to read it to the witness, and the Court properly sustained an objection. (R. 314-5). She made no effort to argue the admissibility of the email, thereby waiving that argument. After the objection was raised, 5 While Mr. Weisbrot may have advised Mr. Monani of the existence of the English lawsuit, Mr. Monani plainly did not recall the conversation, if it in fact occurred and, regardless, the timing of that conversation is ambiguous and may well have occurred after judgment was entered. 6 Landauer improper claims that Mr. Weisbrot was Monani’s “counsel of record” during the English Action. (App. Br. 19). There was no on-going litigation in the United States and Mr. Weisbrot, who is not admitted to practice law in England, could not have represented Monani in the English Action. 29 counsel’s next statement was: “I have no further questions.” Landauer is clearly barred from raising arguments before this Court that were never made to the trial court. Incredibly, Landauer claims (App. Br. 20) that it was not enough for Monani to object to Landauer’s verbal introduction of inadmissible E-mails during the Traverse hearing but that Monani was supposed to submit an improper “sur-reply brief”, “refute authenticity” of already rejected by the Court emails during the Traverse hearing, “or otherwise object” “or to move to strike the reply affidavit.” It is not clear why Monani’s successful objection during the Traverse hearing does not suffice and why does Monani need to refute authenticity or move to strike the e-mails that Landauer failed to introduce during the Traverse hearing in the first place. 7 After all, Landauer seems to be in complete denial that it is Landauer’s and not Monani’s burden to prove proper service on Monani and that Landauer clearly failed to meet its burden in the IAS Court. In fact, the E-mails were introduced for the first time in Landauer’s reply papers on the summary judgment motion, leaving Monani with no opportunity to respond to them. Although Landauer claims that “the trial court did not address 7 Cases cited by Landauer (Horton v. Smith, 51 N.Y.2d. 798, 799, 433 N.Y.S.2d 92, 93 (1980) and Isaacson v. Karpe, 84 A.D.2d 868, 869, 445 N.Y.S.2d 37, 28 (3d Dep’t 1981)) are inapposite and further support Monani’s position. In both cases the evidence at issue was a testimony introduced during the hearing. Here, Landauer failed to introduce any testimony during the Traverse hearing concerning the E-mails. 30 the emails” (App. Br. 19), the IAS Court evidently scheduled the Traverse hearing after considering the parties’ submissions. Moreover, as properly held by the Appellate Department regarding the emails: “[i]n any event, even if the [IAS] court did not consider certain exhibits submitted by plaintiff, there was no error, as the exhibits were submitted for the first time in plaintiff’s reply.” (R. xi-xii) (citing Schultz v. Gershman, 68 A.D. 3d 426, 426 (1 st Dep’t 2009). At the Traverse hearing, Landauer failed to call one party to the E-mails, Monani’s counsel in this action, Mr. Weisbrot, who was sitting in the Courtroom during the Traverse hearing. Monani did not ask Mr. Weisbrot in what capacity he was speaking and whether he had been engaged to represent Monani in this action (which, of course, did not, at the time exist, except in England, where Mr. Weisbrot is not a lawyer). (R. 261). Similarly, Landauer never asked Mr. Weisbrot the meaning of the emails and whether he had communicated with Monani about the lawsuit – or at least advised Monani of the lawsuit. Instead, Landauer, who never raised any of these arguments in front of the lower courts, who never tried to adduce any of this evidence during the Traverse hearing, is now attempting to meet its burden of proof by drawing improper inferences that because Mr. Monani contacted Mr. Preston he must have learned about the English Action from Monani. These claims have no support in the record. When Landauer sold to Monani inedible seafood via its fraudulent “bait and switch” scheme, Mr. 31 Weisbrot had several conversations with Landauers’ lawyers, including Landauer’s “Brooklyn attorney,” in attempt to resolve the parties’ dispute in the United States. See (R. 312-313). Moreover, during the Traverse hearing, Landauer never called Mr. Preston to testify at the Traverse hearing to authenticate, explain, or introduce the E-mails. Instead, Landauer waited until this case reaches the Court of Appeals to introduce new alleged facts and evidence. Landauer claims that it had no reason to anticipate that Monani would deny that service was made. (App. Br. 21). Landauer seems to offer this claim as an excuse for its failure to introduce the emails during the Traverse hearing and to meet its burden of proof. Yet, seven months before the Traverse hearing Monani submitted affidavits of Messrs. Monani and Cardenas confirming that they did not receive notice of the English proceeding. (R. 211- 220). Emails Are Inadmissible Hearsay However, even if the Court were to proceed on the merits of Landauer’s new argument, it would fail. The E-mails are hearsay because they are out of court statements offered to prove the truth of the matter asserted in the statements. Stern v. Waldbaum, Inc., 234 A.D.2d 534, 651 N.Y.S.2d 187 (2d Dep’t 1996). Here, Landauer seeks the admission of the E-mails to prove its version of the truth of the matters asserted in the E-mails – that Monani received the English High Court 32 papers and affirmatively decided to allow a default judgment to be entered against the company. (App. Br. at 18). Thus, the general rule excluding hearsay evidence applies to exclude the E-mails. See People v. Caviness, 38 N.Y.2d 227, 230, 379 N.Y.S.2d 695, 698 (1975) (“the exclusion of [hearsay] is perhaps the best known feature of Anglo-American law”); People v. Acomb, 87 A.D.2d 1, 450 N.Y.S.2d 632 (4th Dep’t 1982). The cases cited by Landauer in no way support the admissibility of the E- mails under a hearsay exception. In re Bergstein v. Board of Education, 34 N.Y.2d 318, 357 N.Y.S.2d 465 (1974), Barone v. Guthy, 295 A.D.2d 460, 744 N.Y.S.2d 673 (2d Dep’t 2002), and Arch-Built Container Corp. v. Interboro Mut. Indem. Ins. Co., 119 A.D.2d 713, 501 N.Y.S.2d 127 (2d Dep’t 1986) (all cited at App. Br. at 21), held that testimony that was offered to establish the witness’ state of mind and not for its truth was not hearsay. That legal proposition is irrelevant – the E-mails are not being offered to establish Mr. Weisbrot’s or Mr. Preston’s (or anyone else’s) state of mind. No one’s state of mind is remotely relevant to the issue of whether process was properly served on Monani. Thus, each of those cases is completely irrelevant. Clearly, by citing specific (although selectively edited) sentences from the emails in order to show the truth of the statements, Landauer hopes to prove facts via the out of court statements. 33 Salahuddin v. Coughlin, 781 F.2d 24, 27 (2d Cir. 1986) (cited at App. Br. at 21) is a federal case that held that litigants are normally held to have notice of all facts known to their attorneys when such attorneys are “acting on [the litigant’s] behalf in litigation.” Leaving aside the questionable applicability of United States federal law to a proceeding pending in New York state court concerning enforcement of an English default judgment, Landauer does not contend that Mr. Weisbrot was representing Monani in the English action. Mr. Weisbrot is not an English attorney. Thus, Salahuddin is inapplicable. In Assured Guar. (UK) Ltd. v. J.P. Morgan Inv. Management Inc., 80 A.D.3d 293, 915 N.Y.S.2d 7 (1st Dep’t 2010), aff’d, 2011 WL 6338898 (Dec. 20, 2011) and Yuppie Puppy Pet Prods. Inc. v. Street Smart Realty, LLC, 77 A.D.3d 197, 906 N.Y.S.2d 231 (1st Dep’t 2010) (both cited at App. Br. at 21), the court took judicial notice of court papers that had been previously filed by a party in another case to determine whether that party’s current position was inconsistent with the position it had taken in the other case. 8 Here, there is no issue of the Court’s taking judicial notice of a filing made by Monani in another action – rather it appears that Landauer is citing these cases to induce the Court to take “judicial notice” of the hearsay E-mails because they were previously attached to 8 Property Clerk v. Seroda, 131 A.D.2d 289 (1 st Dep’t 1987), cited at App. Br. at 21-22, also concerned the Court taking judicial notice of a filing in another action. 34 Landauer’s summary judgment motion papers in this action. Hearsay cannot be magically rendered admissible by the Court taking “judicial notice” of it in the same action. Such a “judicial notice” exception to the hearsay exclusion rule would swallow the rule entirely. Thus, Landauer has proffered no support for the admissibility of the E-mails. The Court should not consider them. Even if this Court were to give any evidentiary value to the E-mails, the contents of those emails are ambiguous and do not support Landauer’s claim that Monani had “actual” notice of the English proceeding that should cure the defective service. Mr. Weisbrot never accepted service of the English proceeding on Monani’s behalf. Further, the cited Email never confirms that Monani was aware of the details of the communications between counsel. In fact, one email from Mr. Weisbrot points out his “belief” as to what Respondent might do. Yet, Appellant’s brief cites that language as a positive proof that, at that point, Monani had actual knowledge of the English lawsuit. Even though the cited language is ambiguous and certainly does not establish actual knowledge by Monani. Even further, later in the brief Landauer omits the phrase “I believe,” and simply misquotes “we will allow your London lawsuit to proceed…” making it appear as though counsel’s musings were definitive and not merely his “belief.” 35 November 23, 2010 Letter Is Not Part Of The Record Similarly to the E-mails, Landauer improperly relies on a letter to the IAS Court dated November 23, 2010 to establish notice – a document which is not in the Record before the Appellate Division, and which Landauer admittedly never tried to include in the record. (App. Br. 13). In fact, Landauer refused Monani’s request to supplement the Appellate Division Record to add the letter. As already discussed above, this Court must reject any new facts and cannot consider the November 23, 2010 letter. B. The Lower Courts’ Decisions Are Consistent With Galliano In order to make it look like Landauer’s appeal is not an improper attempt to introduce new inadmissible facts, Landauer claims that both, the IAS Court and the Appellate Division, failed to apply this Court’s decision in John Galliano, S.A. v. Stallion, Inc., 15 N.Y.3d 75, 81, 904 N.Y.S.2d 683, 686, cert. denied, 131 S. Ct. 288 (2010). Contrary to Landauer’s argument, the IAS Court and the Appellate Division’s decisions were consistent with Galliano. Galliano concerned an issue of whether service of process was appropriate under the Hague Convention where “Stallion was delivered court papers written in French, first by a U.S. marshal, then subsequently on two occasions by process servers from Process Forwarding International (the entity selected by the Department of Justice to carry out service in the United States under the Hague 36 Convention), all in an effort to notify it of the commencement of the French proceeding.” There was no issue of whether the papers were properly served and the only issue was whether they should have been accompanied by an English translation. Id. The Court held that the service did not “run afoul of our conception of personal jurisdiction or our notion of fairness.” Id. Moreover, in Galliano, the Appellate Division had made the factual finding that the defendant “received notice of the French action [and] its service by personal delivery is unlikely to give rise to any objections based on due process.” Id. Here, on the other hand, the problems with the service are far greater than a simple translation issue. The papers were never properly served, so there was never any jurisdiction over Monani, and there was no evidence adduced at the Traverse hearing that established that Monani had notice of the English Action. Unlike this case, there was no dispute in Galliano that defendant in a signed contract consented to the jurisdiction of the French courts. Here, the forum selection clause was buried on the back of the invoice. Landauer only sent to Monani the front pages of the invoices and, as a result, Monani never consented to the English court jurisdiction. (R. 239). 37 Moreover, although Landauer claims that the enforcement of the English judgment is not repugnant to New York’s notion of fairness, Landauer completely ignores the fact that its invoice is completely ambiguous as to choice of venue. For example, the same invoice permits English courts’ jurisdiction, mandates arbitration and prohibits civil proceeding. By Landauer’s admission, the terms and conditions in the invoices all contained the following clause, which requires that any dispute be submitted to arbitration: ARBITRATION – Any dispute whatsoever which cannot be settled privately arising out of, or in relation to, this contract or its construction of fulfillment shall be referred to arbitration in London under the English Arbitration Acts currently in force. There shall be three arbitrators. Each party shall appoint their own arbitrator and the two appointed arbitrators shall appoint a third arbitrator. The arbitrators shall be actively and currently engaged in the trade. Notice of any claim for arbitration must be made, the Claimant’s arbitrator appointed and notice thereof received by the other party within six months from the date of final discharge, failing which the claim shall be deemed to be waived and absolutely barred and no claim for arbitration shall thereafter be made. (R. 213-4). This clause provides for arbitration of “any dispute whatsoever.” (R. 86). See e.g. Fleet Business Credit, LLC v. Michael P. Costelloe, Inc., 19 Misc.3d 29, 30-31, 856 N.Y.S.2d 436, 437 (N.Y. Sup. App. Term 2008) (finding no personal jurisdiction over the defendant and denying plaintiff’s summary judgment where plaintiff attempted to enforce Michigan’s default judgment based 38 on the forum selection clause and defendant disputed its validity); State of Oklahoma v. LNP Realty Corp., 275 A.D.2d 773, 774, 713 N.Y.S.2d 537, 538 (2d Dep’t 2000). Obviously Monani never waived any right to arbitrate this dispute because it did not receive a proper notice of the English Action. As a result, the mere fact that the English Court took jurisdiction over the dispute on default does not prove that it would not have granted Monani’s motion to compel arbitration if in fact Monani was able to make such motion. In fact, Monani had a substantive ground to defend against any arbitration or court proceeding. Pursuant to the arbitration provision in Landauer’s invoices, “Notice of any claim for arbitration must be made, the Claimant’s arbitrator appointed and notice thereof received by the other party within six months from the date of final discharge, failing which the claim shall be deemed to be waived and absolutely barred and no claim for arbitration shall thereafter be made.” (R. 86). The “date of final discharge” was more than six months prior to the institution of the English court proceedings, which apparently took place on or about April 16, 2009, the date of the Application Notice in the English court attached to Landauer’s papers. (R. 215). Indeed, Landauer’s own filings in this action show that its claim would have been barred. The Affidavit of Stephen Brown submitted in support of Landauer’s motion for summary judgment in lieu of complaint cites a provision in the Terms 39 and Conditions providing that a notice of claim must be brought within “14 days of final discharge of goods at port of destination save insofar as the goods are not available for inspection by the buyer within such time in which case notice must be given as aforesaid within 14 days of the date upon which the goods first became available for inspection by the buyer.” (R. 184-185). The Brown Affidavit further stated that the “time within which Defendant could have asserted a quality claim had expired with each and every Contract; nevertheless Landauer sought to come to an amicable agreement with Monani” on or about June 27, 2008. (R. 185). Counting back 14 days from June 27, 2008, the date of “final discharge” must have been no later than June 13, 2008. Yet, the claim form in the English Court action was not issued until April 30, 2009, more than six months after June 13, 2008. (R. 35). Thus, Landauer’s claim was “waived and absolutely barred” prior to its filing of the English court proceedings because it had waited more than six months after final discharge before asserting its claim. Tellingly, Landauer quoted the arbitration provision in its submissions to the English Court, the IAS Court and this Court without including the language limiting its time to file an arbitration. Had the English Court been aware that Landauer had filed suit too late, it presumably would not have granted Landauer a default judgment. Yet, due to Landauer’s tactics in neglecting to cite the operative language, the English Court remained in the dark about Landauer’s failure to abide 40 by the time limitations period contained in the contract it had drafted. This Court should not reward Landauer’s questionable tactics by enforcing the English default judgment. CONCLUSION For the reasons set forth herein, the Court’s Order should be affirmed in all respects. Dated: New York, New York August 12, 2013 FOX ROTHSCHILD LLP By: /s/ N. Ari Weisbrot N. Ari Weisbrot, Esq. Oksana G. Wright, Esq. 100 Park Avenue, 15 th Floor New York, New York 10017