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Posted: June 27, 2015

Default Judgments Reversed for Insufficient Proof of Service

On June 19, 2015, the Fourth Department issued a decision in Interboro Insurance Co. v. Tahir, 2015 NY Slip Op. 05378, analyzing the sufficiency of the proof of service submitted in support of a motion for default judgment.

In Interboro Insurance Co., the trial court denied the plaintiff’s motion for default judgment against three defendants–Bushra Naz, Cliffside Park Imaging & Diagnostic Center and Kimba Medical Supply, LLC–finding that the plaintiff had not submitted sufficient proof of service. The Fourth Department reversed in part, explaining:

[P]laintiff submitted sufficient proof of service of process . . . only with respect to Cliffside, a corporation, and thus the court erred in denying plaintiff’s motion to that extent. . . . Pursuant to CPLR 311(a), personal service on a corporation may be accomplished by, inter alia, delivering the summons to an officer, director, managing or general agent, or cashier or assistant cashier or to any other agent authorized by appointment or by law to receive service. Here, the process server’s affidavit, which stated that the corporate defendant was personally served by delivering a copy of the summons and complaint to its authorized agent and provided a description of that person, constituted prima facie evidence of proper service pursuant to CPLR 311(a)(1).

Contrary to plaintiff’s contention, the court properly denied its motion with respect to Naz, who was allegedly served by the nail and mail method of service. CPLR 308(4) allows that method of service only when service pursuant to CPLR 308(1) and (2) cannot be made with due diligence and, although a process server’s affidavit of service ordinarily constitutes prima facie evidence of proper service, here the process server’s affidavit submitted by plaintiff fails to demonstrate the requisite due diligence. The affidavit failed to indicate whether there was an attempt to effectuate service at Naz’s actual dwelling place or usual place of abode, and there is no indication that the process server made genuine inquiries to ascertain Naz’s actual residence or place of employment.

We also reject plaintiff’s contention that the court erred in denying its motion with respect to Kimba, a limited liability company. Plaintiff alleged that Kimba was served pursuant to Limited Liability Company Law § 304. That statute is substantively identical to Business Corporation Law § 307, and both statutes apply to foreign business entities not authorized to do business in New York. We conclude that, just as strict compliance with the procedures set forth in Business Corporation Law § 307 is required pursuant to Flick v Stewart-Warner Corp., strict compliance is likewise required for the procedures set forth in Limited Liability Company Law § 304. Here, plaintiff failed to establish that it strictly complied with the filing requirements of Limited Liability Company Law § 304(e).

(Internal quotations and citations omitted). The “filing requirements of” Section 304(e) to which the court refers are:

Where service of a copy of process was effected by mailing in accordance with this section, proof of service shall be by affidavit of compliance with this section filed, together with the process, within thirty days after receipt of the return receipt signed by the foreign limited liability company or other official proof of delivery or of the original envelope mailed. If a copy of the process is mailed in accordance with this section, there shall be filed with the affidavit of compliance either the return receipt signed by such foreign limited liability company or other official proof of delivery or, if acceptance was refused by it, the original envelope with a notation by the postal authorities that acceptance was refused. If acceptance was refused, a copy of the notice and process together with notice of the mailing by registered mail and refusal to accept shall be promptly sent to such foreign limited liability company at the same address by ordinary mail and the affidavit of compliance shall so state. Service of process shall be complete ten days after such papers are filed with the clerk of the court. The refusal to accept delivery of the registered mail or to sign the return receipt shall not affect the validity of the service and such foreign limited liability company refusing to accept such registered mail shall be charged with knowledge of the contents thereof.

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