ICD Group, Inc. v. Israel Foreign Trade Company (USA) Inc.

224 A.D.2d 293, 638 N.Y.S.2d 430, 1996 N.Y. App. Div. LEXIS 1088

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: February 15, 1996
• Status: Published

Opinion

— Orders, Supreme Court, New York County (Robert D. Lippmann, J.), entered on or about August 30,1995 which, insofar as appealed from, granted plaintiff’s motion to quash a subpoena, are unanimously reversed, on the law and the facts, without costs, and plaintiff’s motion to quash the May 10, 1995 subpoena is denied.

On August 1, 1994, after trial, a judgment was entered in favor of defendants on a counterclaim in the underlying action in the amount of $808,443.12. In May 1995, defendants issued a subpoena to Richard A. Eisner & Co. ("Eisner”), plaintiff’s accountant, directing the production of documentation concerning any sale of plaintiff’s stock and/or assets since 1993. Defendants maintain that after judgment, plaintiff transferred substantially all of its United States assets to a wholly-owned subsidiary for no real consideration. The IAS Court, upon an in camera inspection, found the stock agreement in question irrelevant to the underlying case. We disagree.

CPLR 5223 provides that "[a]t any time before a judgment is satisfied or vacated, the judgment creditor may compel disclosure of all matter relevant to the satisfaction of the judgment” (emphasis added). The foregoing, as noted by Professor Siegel, is a generous standard which permits the creditor a broad range of inquiry through either the judgment debtor or any third person with knowledge of the debtor’s property (see generally, Siegel, Practice Commentaries, McKinney’s Cons Laws of NY, Book 7B, CPLR C5223:2, at 214).

In the matter before us, given the wholesale nature of plaintiff’s transfer of assets, the stock purchase agreement which, inter alia, transferred plaintiff’s stock, is discoverable so that defendants may inquire into such transfer to determine whether there was an intent to defraud the creditor (see, Young v Torelli, 135 AD2d 813). Concur — Rosenberger, J. P., Rubin, Kupferman, Nardelli and Tom, JJ.