Acevedo v 439 Realty Corporation
Attorneys and Parties
Brief Summary
Premises liability slip-and-fall and procedural standards for vacating a default after a plaintiff amends to add a corporate property owner.
Granted the owner’s motion to vacate leave to amend, vacate the default orders and judgment, and dismissed the complaint as time-barred.
The order vacating the amendment and default determinations and dismissing the complaint against Kraupner-Academy Pharmacy, Inc. was reversed; the motion to vacate and dismiss was denied.
A proposed additional defendant need not be served with the motion to amend, and Kraupner-Academy Pharmacy, Inc. failed to show a reasonable excuse for its default under New York Civil Practice Law and Rules (CPLR) 5015(a)(1) [requires a reasonable excuse and a potentially meritorious defense to vacate a default]; the principal’s claimed confusion and assumption that another attorney would respond were inadequate.
Background
The building at 1350 Greene Avenue, Brooklyn, was owned by Kraupner-Academy Pharmacy, Inc. (Academy), and Kraupner Pharmacy, Inc. (the Pharmacy) was a tenant. On March 6, 2015, plaintiff Marisol Acevedo, an employee of another tenant, slipped and fell on the stairs. She commenced suit on December 22, 2016 against 439 Realty Corporation and the Pharmacy. On November 5, 2018, she moved to amend to add Academy; the court granted leave on March 25, 2019. Plaintiff served Academy via the New York Secretary of State on May 13, 2019 and mailed a copy to the building. Academy did not respond. Plaintiff moved for a default on August 15, 2019; the court granted the motion on November 18, 2019, and a $150,000 judgment was entered on November 29, 2022. Academy moved on December 27, 2022 to vacate the amendment order, the default order, and the judgment, and to dismiss as time-barred. The Supreme Court granted the motion on July 27, 2023. Plaintiff appealed.
Lower Court Decision
The Supreme Court, Kings County (Sweeney, J.), granted Academy’s motion to vacate the March 25, 2019 order granting leave to amend, the November 18, 2019 unopposed default order, and the November 29, 2022 judgment, and dismissed the complaint against Academy as time-barred.
Appellate Division Reversal
Reversed, with costs. The Appellate Division held that a motion to amend to add a defendant need not be served on the proposed defendant and that Academy failed to establish a reasonable excuse for its default under CPLR 5015(a)(1) [requires a reasonable excuse and a potentially meritorious defense to vacate a default]. Academy’s principal admitted receiving the second supplemental summons and amended complaint but claimed he did not realize Academy had been added and assumed the Pharmacy’s attorney would handle it—an unreasonable excuse. Because no reasonable excuse was shown, the court did not reach whether Academy had a potentially meritorious defense or its statute-of-limitations argument. The motion to vacate and dismiss was denied, effectively reinstating the amendment, default order, and judgment.
Legal Significance
Confirms that plaintiffs may obtain leave to amend to add a defendant without serving the proposed defendant with the motion and reinforces the stringent requirement that a movant seeking to vacate a default under CPLR 5015(a)(1) must show a genuine, reasonable excuse; mere confusion or reliance on another entity’s counsel is insufficient. Corporate defendants served via the Secretary of State must maintain procedures to respond to process or risk default judgments that will not be easily vacated.
Adding a defendant does not require serving that party with the amendment motion, and a default will not be vacated absent a concrete, reasonable excuse under CPLR 5015(a)(1); assumptions and oversight are inadequate.