B.N. Realty Associates v. Lichtenstein

21 A.D.3d 793, 801 N.Y.S.2d 271
CourtAppellate Division of the Supreme Court of the State of New York
DecidedSeptember 20, 2005
StatusPublished
Cited by22 cases

This text of 21 A.D.3d 793 (B.N. Realty Associates v. Lichtenstein) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
B.N. Realty Associates v. Lichtenstein, 21 A.D.3d 793, 801 N.Y.S.2d 271 (N.Y. Ct. App. 2005).

Opinion

[794]*794Order, Supreme Court, Bronx County (Howard R. Silver, J.), entered November 3, 2003, which, insofar as appealed from and not academic, denied without prejudice plaintiff’s motion for summary judgment holding defendant-respondent liable to plaintiff in the principal amount of $42,544.32 and dismissing defendant-respondent’s counterclaims, unanimously modified, on the law, to grant plaintiff partial summary judgment dismissing defendant-respondent’s tenth affirmative defense (laches), and otherwise affirmed, without costs. So much of the appeal from the aforesaid order as seeks review of the direction to hold a traverse hearing unanimously dismissed, without costs, as academic. Order, same court and Justice, entered February 24, 2004, which, after a traverse hearing, dismissed the complaint for lack of personal jurisdiction, unanimously reversed, on the law, without costs, the complaint reinstated, and defendant-respondent’s first affirmative defense (lack of personal jurisdiction) dismissed.

Plaintiff B.N. Realty Associates (BNRA), a landlord, commenced this action in 1994 to recover $42,544.32 in rent and/or use and occupancy that defendant-respondent Ben Lichtenstein and his former wife (the nonappearing codefendant) allegedly owe for their occupancy of an apartment in BNRA’s building from December 1, 1988 through July 1, 1993. In his answer to the complaint, Lichtenstein asserted 17 affirmative defenses and six counterclaims. The first affirmative defense set forth in Lichtenstein’s answer was lack of personal jurisdiction, based on the claim that Lichtenstein had not been properly served with process.

For about four years after the service of Lichtenstein’s answer, the action remained dormant. Then, in April 1998, BNRA [795]*795changed its counsel and served Lichtenstein with a reply to the counterclaims and discovery demands. In May 1998, the court issued an order requiring Lichtenstein to accept service of the reply and to respond to BNRA’s discovery demands, based on findings that Lichtenstein had never taken any steps to prosecute the counterclaims and was not prejudiced by the late service of the reply. The May 1998 order was not appealed.

In August 1998, Lichtenstein filed a voluntary chapter 7 bankruptcy petition, thereby automatically staying proceedings in this action. Lichtenstein’s petition acknowledged BNRA’s claim against him for back rent for the period at issue in this action, and did not indicate that such claim was either “contingent,” “unliquidated,” or “disputed.” Although the petition did not disclose any counterclaims, setoffs or affirmative defenses that Lichtenstein allegedly had against BNRA, it did disclose the pendency of the instant action. In December 1999, BNRA commenced an adversary proceeding in the bankruptcy case. BNRA’s complaint in the adversary proceeding objected to Lichtenstein’s receiving a discharge in bankruptcy on the ground that Lichtenstein’s allegedly fraudulent conduct constituted a bar to his discharge under 11 USC § 727 (a) (2), (3) and (4).

In September 2000, Lichtenstein moved to dismiss his own bankruptcy petition. In response, BNRA cross-moved for, among other relief, summary judgment on its complaint in the adversary proceeding. By order dated February 14, 2002, the Bankruptcy Court denied Lichtenstein’s motion, granted BNRA’s cross motion for summary judgment denying Lichtenstein a discharge, lifted the automatic stay of litigation against Lichtenstein, and awarded BNRA attorneys’ fees (subsequently assessed against Lichtenstein in the amount of $25,000). In effect, the Bankruptcy Court dismissed Lichtenstein’s petition.1

In April 2003, BNRA moved to restore this action to Supreme Court’s calendar, and for summary judgment holding Lichtenstein liable to it for the damages sought in the complaint, plus prejudgment interest, costs and attorneys’ fees. BNRA sought summary judgment on the ground that Lichtenstein’s failure to list any alleged counterclaims, setoffs or affirmative defenses against BNRA in his bankruptcy petition deprived him of standing to assert such matters in this action. Lichtenstein, in addition to opposing the motion, cross-moved to dismiss the complaint on the ground of laches or, in the alternative, for a [796]*796traverse hearing to determine whether BNRA had effected valid service of the summons and complaint (as previously noted, a defense of improper service of process had been raised in Lichtenstein’s answer).

In the order entered November 3, 2003, Supreme Court granted BNRA’s motion insofar as it sought to restore the action to the calendar, but denied the motion insofar as it sought summary judgment in BNRA’s favor. The court denied Lichtenstein’s cross motion to dismiss the complaint, but did order a traverse hearing to resolve the jurisdictional issue. When the traverse hearing was convened, BNRA was unable to produce a process server to testify. In the order entered February 24, 2004, the court dismissed the complaint on the ground that, at the traverse hearing, BNRA had failed to prove valid service of process. BNRA appeals from both of these orders.

We first address the appeal from the February 2004 order dismissing the complaint for want of proof of valid service of process, since the substantive issues raised by the appeal from the November 2003 order would be academic if Lichtenstein’s jurisdictional defense had merit. The record establishes, however, that, contrary to the motion court’s view, Lichtenstein has waived his jurisdictional defense as a matter of law.

During the pendency of this action (and more than a year before the filing of the bankruptcy petition), the Legislature (by L 1996, ch 501, § 1) amended CPLR 3211 (e) to provide that “an objection that the summons and complaint . . . was not properly served [ ] is waived if, having raised such an objection in a pleading, the objecting party does not move for judgment on that ground within sixty days after serving the pleading, unless the court extends the time upon the ground of undue hardship.” Where, as here, the action was pending at the time the amendment of CPLR 3211 (e) was enacted, the 60-day period is deemed to run from the effective date of the amendment, which was January 1, 1997 (see Matter of Farkas v Chase Manhattan Bank, 290 AD2d 253 [2002]; Wade v Byung Yang Kim, 250 AD2d 323 [1998]; Fleet Bank, N.A. v Riese, 247 AD2d 276 [1998]). It is undisputed that Lichtenstein failed to move for judgment based on his objection to service of process (asserted in the first affirmative defense of his answer) within 60 days after January 1, 1997. Further, Lichtenstein has never made any showing of “undue hardship” that would warrant extending his time to make such a motion. Accordingly, under present CPLR 3211 (e), Lichtenstein has waived his service objection and the jurisdictional defense based thereon (see Siegel, NY Prac § 266, at 448; § 274, at 456 [4th ed]). We therefore reverse the order entered [797]*797February 24, 2004, reinstate the complaint, and dismiss Lichtenstein’s first affirmative defense of lack of personal jurisdiction.

We now turn to BNRA’s appeal from the November 2003 order, which, insofar as appealed from, denied BNRA’s motion for summary judgment and directed that a traverse hearing be held to determine the merits of Lichtenstein’s jurisdictional defense.

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Bluebook (online)
21 A.D.3d 793, 801 N.Y.S.2d 271, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bn-realty-associates-v-lichtenstein-nyappdiv-2005.