limited agents such as attorneys and accountants are not required to accept service on behalf of their clients", service on Yasmeen Husain, even if she is viewed as TCI's agent, was insufficient. See Sup. Mem. Opp'n R&R 5 (emphasis added). This argument should also be rejected.
Although TCI cites Davis-Wilson correctly, the case can easily be distinguished as Ms. Husain cannot be viewed as a "limited agent." Dr. Damadian's testimony that TCI's president, stated that "Yasmeen ... would be [TCI's] representative" in the United States, clearly indicated that TCI intended that Ms. Husain would be more than a limited agent. Ms. Husain was, in every transaction with Fonar, acting in a much greater capacity than that of an attorney or accountant. Ms. Husain signed the relevant contracts on behalf of TCI, assisted in negotiations and subsequent dealings, and was the eyes and ears of TCI in the United States. According to the case law, all N.Y. Civ. Prac. L. & R. § 311 requires when there has been no express authorization to accept service is service which, when viewed objectively, is calculated to give the corporation fair notice of the action. See Kuhlik v. Atlantic Corp., Inc., 112 F.R.D. 146, 148 (S.D.N.Y. 1986) (citing Fashion Page Ltd., supra, 50 N.Y.2d at 272). Under these circumstances, service on Ms. Husain, when viewed objectively, was reasonably calculated to give TCI fair notice of the pending action.
Further, TCI claims that Ms. Husain was not its managing or general agent. In support of this claim, TCI argues that the factual record does not support the finding that Yasmeen Husain had authority to exercise judgment or discretion on behalf of TCI with respect to the specific transaction at issue, and that Magistrate Judge Orenstein did not make the requisite finding that Ms. Husain had authority to exercise judgment or discretion on TCI's behalf on a regular and continuous basis. These arguments should be rejected.
The record is replete with indications that Ms. Husain not only had the authority to exercise judgment and discretion on TCI's behalf with respect to the specific transaction at issue, but also on a general, regular and continuous basis.
For example, TCI's president indicated that Ms. Husain would be TCI's representative in the United States (Tr. 165). In addition, as stated previously, Ms. Husain signed all contracts and amendments as TCI's vice president, or at the very least on their behalf. Ms. Husain also directed the day to day relationship between TCI and Fonar with respect to the purchase and installation of the MRI system (Tr. 166-68). Further, it was Ms. Husain who chose and retained TCI's attorney for its general and specific business dealings with Fonar, which happened to be AMS' attorney as well (Tr. 166). Moreover, when a Fonar employee attempted to contact TCI's vice president directly to discuss the business relationship, Ms. Husain directed them in essence to refrain from doing so, and to direct all inquiries through AMS and TCI's counsel (Tr. 167). All of these facts point to the inescapable conclusion that Fonar had a reasonable basis to conclude that Ms. Husain was TCI's managing or general agent.
Finally, TCI claims that AMS was not its managing or general agent. In support of this claim, TCI argues that AMS could only be considered a limited agent of TCI based on the lack of authority to bind the company. Such an argument must also be rejected.
Under New York law, a foreign corporation may be served in the United States by delivering a copy of the summons and complaint to the corporation's agent within the United States. See, e.g., Stimmler, supra, 195 F. Supp. at 671-72. Service on the agent is proper as long as the agent is so related to the foreign corporation that it may be justly inferred that the foreign corporation will have notice of the action. See Ameritex, supra, 125 N.Y.S.2d at 482. As with Ms. Husain's relationship with TCI, the record is replete with indications that AMS was much more than TCI's limited agent, and, therefore, service upon its president -- Ms. Husain -- was proper. Specifically, TCI's president indicated to Fonar that AMS was established "so that [TCI's] needs [would] be taken care of" (Tr. 165). Further, as AMS "was in constant contact with TCI, relaying all communications between TCI and Fonar and originating many of the communications from TCI to Fonar with respect to the disputed contract and its amendments" (Tr. 171), it may justly be inferred that TCI had sufficient notice of the action.
Accordingly, Magistrate Judge Orenstein's Report is adopted and TCI's motion to dismiss the amended complaint is denied.
Dated: Brooklyn, New York
May 2, 1995
David G. Trager
United States District Judge