Americu Credit Union v. Myers

Americu Credit Union, Respondent/Plaintiff v. Richard M. Myers¹ & Christopher M. Myers, Appellant/Defendant The Appellant, Christopher M. Myers, argues that his motion to vacate a default judgment against him should have been granted,² because there was insufficient service made to obtain personal jurisdiction over him and because the Court Clerk lacked the authority to enter the default judgment against him because the complaint was not for a ‘sum certain’. The City Court held a traverse hearing on the issue of proper service of the defendant and found that the Appellant was properly served. The lower court failed to address the issue of the power of the Court Attorney for the Appellant: Anthony J. Pietrafesa, Esq., Riehlman Shafer and Shaw, LLC.Clerk to enter a default judgment in this case.³ Each of the arguments will be addressed herein below.⁴ Service upon the Appellant A “duly executed affidavit of service” constitutes “prima facie evidence” that the Appellant was properly served. That presumption may be rebutted only by a sworn statement of specific facts that denies service. Wright v. Denard, 111 AD3d 1330, 1331 (4th Dept. 2013). The Respondent alleges that the Appellant was served by personal service upon his mother and subsequent mailing of process to his residence pursuant to CPLR §308(2). Both the Appellant and his mother submitted affidavits alleging that he was never so served. City Court held a traverse hearing, at which time the Appellant called Mark Esce, its process server. He testified to serving a person identifying herself as Judy Sidari. The person also stated that she was the Defendant’s mother. Esce testified that he had not been provided information identifying the Defendant’s family members, either by name or relationship. While the Appellant’s mother claimed that she was not served with process, “[a]fter considering all of the submitted exhibits, and, weighing the testimony of the witnesses and assessing their credibility,” the Court found that proper service had been made. Upon review of the record, and giving proper deference to Judge Limpert, as he was able to observe the witnesses and judge their credibility, the Court affirms that decision. It is significant that Mr. Esce’s affidavit of service indicates that a person matching the name and relationship with the Appellant was present at the exact address that the Appellant listed as his address in the underlying contract. Moreover, neither denied receipt of the copy of the summons and complaint that Esce’s affidavit shows was mailed on the following day. While it is true that the description of Ms. Sidari’s appearance in 2010 differed with that in 2019, as noted by Judge Limpert, “a person’s appearance will change over (time)”. While there was a claimed difference of 50 pounds between her weight estimated on the affidavit of service and what Ms. Sidari claimed it to have been and there was a claimed difference in hair color, it is significant that the Appellant failed to offer any photographic evidence showing her appearance at the time.⁵ The Appellant alleges that the Court employed the wrong standard of proof. Although the language utilized by the court might support that conclusion, I am satisfied that the court employed the correct standard of proof, albeit in an in artful manner. Moreover, in my power to draw my own conclusions based on the record, I am convinced that the Respondent proved valid service by preponderance of the evidence. Authority to Enter a Default Judgment The Appellant argues, in its memoranda of law, that this is a consumer auto loan deficiency claim subject to UCC Article 9 (page 64). “[A] deficiency judgment is the finding of personal liability upon a debtor for the unpaid balance of a secured debt after disposition of the collateral fails to provide proceeds sufficient to satisfy the underlying debt” In re King, 305 B.R. 152, 171 (USBC SD Poughkeepsie Division 2004). That is the case herein. The Appellant entered into a retail installment contract (page 120) for the purchase of a vehicle, with the Respondent as Assignee under the contract. The Appellant admits that he returned the vehicle when he could no longer afford the payments (page 75). The Respondent sent a Notice of Plan to Sell Property to the Respondent dated August 20, 2010 (page 123). The Respondent also sent a Notice of Sale (page 124) dated September 7, 2010, to Richard Myers, but the record does not show that a Notice of Sale was sent to the Appellant.⁶ The Notice of Sale indicates that it is in accordance with the UCC and that there is a deficiency balance in the amount of $6,463.71, demonstrating that the Respondent admits that this is a consumer loan deficiency claim. “The [Respondent] demonstrated its prima facie entitlement to judgment as a matter of law on the issue of liability. In opposition, the [Appellant] failed to raise a triable issue of fact as to liability. [He] argued only that there were issues of fact as to whether the [vehicle] was sold in a commercially reasonable manner, and whether there were deficiencies in the notice of sale, both of which are relevant only to the issue of damages” M & T Bank v. Sailor, 131 AD3d 1017 (2d Dept 2015). “A secured creditor is entitled to maintain an action for the deficiency provided that the notice of sale was given to the debtor as required by law (UCC 9-611), and that the sale was commercially reasonable” Charter One Auto Finance Corp. v. Vaglio, 2003 WL 1793074. It is the creditor’s burden to prove “the amount of the debt, the fair market value of the security and the resulting deficiency” First American Bank of New York v. Wassel, 158 Misc 2d 906, 908 (Sup. Ct. Orange Co. 1993). The fair market value of the vehicle and whether the sale was commercially reasonable are issues of fact in the case herein. Therefore, this matter is remitted to Syracuse City Court, Judge Limpert, solely for a hearing to determine the correct amount of the Judgment owed. For the reasons set forth herein, IT IS HEREBY ORDERED, that the Decision and Order appealed from is AFFIRMED in part and REMITTED for further proceedings in part. The foregoing shall constitute the Decision and Order of this Court. Dated: February 11, 2020