VAMA F.Z. CO. VS. PACIFIC CONTROL SYSTEMS (L-2375-18, MORRIS COUNTY AND STATEWIDE)

CourtNew Jersey Superior Court Appellate Division
DecidedJanuary 20, 2021
DocketA-1020-19T1
StatusUnpublished

This text of VAMA F.Z. CO. VS. PACIFIC CONTROL SYSTEMS (L-2375-18, MORRIS COUNTY AND STATEWIDE) (VAMA F.Z. CO. VS. PACIFIC CONTROL SYSTEMS (L-2375-18, MORRIS COUNTY AND STATEWIDE)) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
VAMA F.Z. CO. VS. PACIFIC CONTROL SYSTEMS (L-2375-18, MORRIS COUNTY AND STATEWIDE), (N.J. Ct. App. 2021).

Opinion

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO. A-1020-19T1

VAMA F.Z. CO.,

Plaintiff-Appellant,

v.

PACIFIC CONTROL SYSTEMS (L.L.C.) and DILIP RAHULAN,

Defendants-Respondents. ___________________________

Argued December 2, 2020 – Decided January 20, 2021

Before Judges Geiger and Mitterhoff.

On appeal from the Superior Court of New Jersey, Law Division, Morris County, Docket No. L-2375-18.

Steven L. Caponi, (Rome Blank) of the Delaware Bar, admitted pro hac vice, argued the cause for appellant (K&L Gates LLP, attorneys; Reymond E. Yammine, of counsel and on the briefs; Steven L. Caponi, on the brief).

David C. Dreifuss argued the cause for respondent (Dreifuss, Bonacci & Parker, PC, attorneys; David C. Dreifuss, of counsel and on the brief; Paul M. McCormick, on the brief). PER CURIAM

Plaintiff Vama F.C. Co. (Vama) appeals from a September 24, 2019 order

granting summary judgment to defendants Pacific Control Systems, L.L.C.

(Pacific) and Dilip Rahulan declaring that a foreign money-judgment Vama

obtained against defendants in the Court of First Instance in Dubai, United Arab

Emirates (UAE) (the Dubai judgment), was not recognized in New Jersey and

shall not be filed as a judgment in New Jersey. We affirm.

We derive the following facts from the record. Vama is a UAE

corporation whose majority owner is Tejas Shah. Pacific is a UAE limited

liability company located in Dubai, and Rahulan was its Chairman and Chief

Executive Officer. Rahulan is an Australian citizen who lived in Dubai until

May 1, 2016, when he moved to New Jersey.

During 2016, Shah attempted to cash two checks drawn on Pacific's

checking account that were payable to Vama. Both checks, signed with

Rahulan's name, were issued to pay a debt Pacific owed to Vama. The checks

totaled 21,852,500 UAE dirham (AED), or $5,949,255 on the dates they were

issued.1 Neither check cleared due to insufficient funds in Pacific's account.

1 The UAE dirham is the currency of UAE.

A-1020-19T1 2 In August 2016, Vama's attorney issued a notice informing Pacific and

Rahulan that the checks had been returned for insufficient funds, and that Vama

would take legal action if the debt was not paid. The notice listed Pacific and

Rahulan's address as "Dubai, Bur Dubai, Sheikh Zayed Street, TP 101423,

Techno Park."

Rahulan alleged that he did not sign either check, was not aware the

checks had been issued, and did not know the reason for issuance. He believed

his signature had been forged by Srinivasan Narasimhan, Pacific's former Chief

Financial Officer (CFO).

The Dubai Proceedings

Having received no payment from Pacific or Rahulan, Vama commenced

a civil action against them in Dubai. On August 23, 2016, a Dubai court officer

served notice of the action on defendants by delivering it to a receptionist named

Adeel Gawanico at "Bur Dubai- Sheikh Zayed Road – Guidance Phone No.:

0506539145." The notices stated delivery to Pacific was made "in the area of

Technopark Co," and to Rahulan "in the area of Sheik Zayed Road." A month

later, on September 22, 2016, the Dubai Court of First Instance entered an order

for execution of provisional attachments on Pacific and Rahulan's bank

A-1020-19T1 3 accounts. According to Shah, the court served provisional attachments on

defendants' bank accounts a few days later.

Defendants did not file a responsive pleading or participate in the

proceedings. On January 17, 2017, the Dubai Court of First Instance issued a

judgment against them for 21,852,500 AED plus interest. Rahulan certified he

did not learn of the judgment until May 2017, when he asked his Dubai counsel

to investigate after Shah called him and mentioned the lawsuit.

Rahulan asserted that he never received notice of the lawsuit. He certified

he could not have received notice personally, as he had "left Dubai (U.A.E.) on

May 1, 2016 and was living in New Jersey throughout the pendency of the civil

proceedings and the entry of [a] criminal judgment against [him]." Moreover,

Pacific's correct address "was and is: Pacific Control Systems (L.L.C.), Post

Box 37316, Techno Park, Sheikh Zayed Road, Dubai, [UAE]. Techno Park is a

large complex with numerous businesses which is miles away from Bur Dubai.

Therefore, it is clear that the [process] server went to the wrong address." He

averred that no one named Adeel Gawanico had ever worked for Pacific, and

Pacific's actual receptionist was not authorized to accept important documents.

In addition, Rahulan certified that he never received notification from the banks

about the provisional attachments served on his and Pacific's accounts.

A-1020-19T1 4 On June 19, 2017, defendants filed an appeal challenging the Dubai

judgment. The Dubai Court of Appeal affirmed the judgment without

considering the merits of the case, finding that the appeal was untimely because

appeals in Dubai must be filed within thirty days of the issuance of the judgment

being challenged. In its opinion, the court noted that Pacific received notice of

the judgment through service on its accountant Sobish Sondran on February 20,

2017, and Rahulan had been notified by publication on March 28, 2017.

Rahulan certified that Pacific did not employ an individual named Sobish

Sondran, and he was not aware of any such published notice.

The New Jersey Proceedings

In November 2018, Vama applied to the Clerk of the Superior Court to

record the Dubai judgment in New Jersey. The Clerk refused to docket the

judgment because Vama had not submitted an exemplified copy.

In response, on December 5, 2018, defendants filed this declaratory

judgment action against Vama, seeking: (1) nonrecognition of the Dubai

judgment pursuant to N.J.S.A. 2A:49A-16.6(c), on grounds of lack of

jurisdiction, lack of notice, lack of due process, and violation of public policy;

and (2) injunctive relief to preclude enforcement and execution of the Dubai

A-1020-19T1 5 judgment.2 Defendants also applied for a temporary restraining order and

preliminary injunction against plaintiff. The trial court denied the application

for injunctive relief without prejudice, finding defendants had failed to

demonstrate they would suffer irreparable harm.

Vama filed an answer and counterclaim seeking recognition of the Dubai

judgment pursuant to the Foreign Country Money-Judgments Recognition Act

of 2015 (the Recognition Act), N.J.S.A. 2A:49A-16.1 to -16.11. Vama alleged

that the balance due on the Dubai judgment was $5,949,998.70 plus interest at

nine percent per annum and attorney's fees. Defendants filed an answer to

Vama's counterclaim. 3

In February 2019, the Dubai Court of First Instance issued a decision in a

separate action brought by two directors of Pacific, dismissing Rahulan from his

2 The complaint initiating this action was filed by Pacific and Rahulan against Vama. The caption was subsequently amended to designate Vama as plaintiff and Pacific and Rahulan as defendants. See n.3, infra.

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VAMA F.Z. CO. VS. PACIFIC CONTROL SYSTEMS (L-2375-18, MORRIS COUNTY AND STATEWIDE), Counsel Stack Legal Research, https://law.counselstack.com/opinion/vama-fz-co-vs-pacific-control-systems-l-2375-18-morris-county-and-njsuperctappdiv-2021.