United States District Court, S.D. New York
July 12, 2005.
LEWIS & KENNEDY, INC., Plaintiff,
PERMANENT MISSION OF THE REPUBLIC OF BOTSWANA TO THE UNITED NATIONS and OVE ARUP & PARTNERS CONSULTING ENGINEERS P.C., Defendant.
The opinion of the court was delivered by: HAROLD BAER, JR., District Judge[fn*] [fn*] Margaret Johnson, a Summer 2005 intern in my Chambers, and currently a second year law student at New York University School of Law, provided substantial assistance in the research and drafting of the Opinion.
OPINION & ORDER
Plaintiff, Lewis & Kennedy, Inc. ("Lewis"), filed this instant
Complaint for breach of contract against the Permanent Mission of
the Republic of Botswana to the United Nations ("the Mission")
and Ove Arup & Partners Consulting Engineers, P.C. ("Ove Arup").
The Mission moves to dismiss (1) on the grounds that Lewis failed
to properly effectuate service in accordance with the Foreign
Sovereign Immunities Act, 28 U.S.C. § 1608 and (2) pursuant to
Rule 12(b)(6) of the Federal Rules of Civil Procedure ("Rule
12(b)(6)"). Ove Arup does not oppose this motion. (Aff. of Alfred
Lyons, Principle of Ove Arup). The matter was sub judice
following oral argument on July 8, 2005. For the foregoing
reasons, the Mission's motion to dismiss for improper service is
GRANTED in-part and the motion to dismiss pursuant to Rule
12(b)(6) is DENIED.
A. Factual Background
In February 2003, the Mission hired Lewis, a general
contractor, to "perform work and labor and provide materials" for
renovations to the home of the Permanent Mission of Botswana,
located at 154-156 West 46th Street in New York City, and Ove
Arup to serve as its representative for the project. (Compl. ¶
4.) The agreement between the parties had an estimated base cost
of $3,859,088.70. (Compl. ¶ 5.) According to Lewis, during
construction, which lasted from March 2003 to April 2004, certain changes were
made to the scope of work and recorded in Change Orders, which
were approved by the Mission and Ove Arup. (Compl. ¶¶ 8-10.) The
Change Orders allegedly increased the cost of the project by
$641,985 and the final cost to $4,521,672.66. (Compl. ¶ 10.) To
date, Lewis has allegedly been paid $3,744,870.42. (Compl. ¶ 13.)
The focus of this dispute is the remaining $776,802.24. (Compl. ¶
B. Procedural History
1. Attempts at Service in 2004
On or about December 8, 2004, Lewis filed suit for breach of
contract in New York Supreme Court against the Mission and Ove
Arup. (Pl.'s Mem. in Opp'n to Mot. to Dismiss, ¶ 3.) Lewis, by
and through a process server, Julio De Lara ("Process Server")
attempted to serve the Summons and Complaint on the Mission on
December 14 and 15, 2004. (Aff. of Serv. by Julio De Lara, Dec.
17, 2004) (herein "Aff. of Service").*fn1 According to a
signed affidavit of the Process Server, on both occasions, he was
told that "they would not accept service" and to "go away." (Aff.
of Service.) According to Lewis, on December 16, 2004, the
Complaint was also served on the Mission, yet the method of
service is unclear. On the one hand, in Lewis' opposition to the
motion to dismiss, Lewis states that the Process Server "affixed
the summons and complaint to the door" of the Mission and
completed service on December 17 when the Summons and Complaint
were mailed via regular mail to Ambassador Alfred Mataye Dube
("Ambassador Dube") (Aff. of Service), and Lewis subsequently
filed with the New York State Supreme Court an Affidavit of
Service. (Not. of Removal, Robert Van Lierop, Att'y for Def.) On
the other hand, the Process Server's affidavit indicates that the
papers were delivered by hand directly to "Jane Smith" at the
Mission. (Aff. of Service).
2. Attempts at Service in 2005
In addition to the attempts to serve the Mission in 2004, on
February 14, 2005, Lewis allegedly delivered two copies of the
Summons and Complaint to the New York County Clerk's Office with
a certified mailing envelope that the Clerk mailed to the
Mission. (Pl. Mem. in Opp'n to Def.'s Mot. to Dismiss, ¶ 5) ("the
February 14 mailing".) However, Lewis fails to indicate to whom
the envelope was addressed. Following the February 14 mailing,
Lewis allegedly delivered a second amended Summons, Complaint and
Notice of Suit to the County Clerk's Office sometime in March 2005, but again fails to
indicate to whom service was addressed. (Pl. Mem. in Opp'n to
Def.'s Mot. to Dismiss, ¶ 12) ("the March mailing".) Lewis also
maintains that Plaintiff intended to deliver a third copy of the
Summons, Complaint, and Notice of Suit to Ambassador Dube
sometime in April via certified mail. (Pl. Mem. in Opp'n to
Def.'s Mot. to Dismiss, ¶ 14) ("the April mailing".) However,
Lewis does not allege that this attempt was conducted through the
County Clerk's Office and no proof of service was included in the
On March 4, 2005, the Mission filed a Notice of Removal to this
Court under 28 U.S.C. §§ 1330, 1332, 1441, 1446 and Rule 81(c) of
the Federal Rules of Civil Procedure (Not. of Removal, Robert Van
Lierop, Att'y for Def.), and, on April 11, 2005, the Mission
filed the instant motion to dismiss.
II. IMPROPER SERVICE
The Mission argues this Court lacks personal jurisdiction. To
ascertain whether personal jurisdiction exists, the Court must
determine whether (1) the Mission is entitled to immunity under
the Foreign Sovereign Immunities Act (herein "FSIA").
28 U.S.C. § 1608. If the Mission is not immune from the lawsuit, the Court
must then decide (2) whether the Mission is a "foreign state" or
an "agency or instrumentality of a foreign state" for the purpose
of proper service of the Summons and Complaint. Depending on the
status of the Mission, the Court must finally determine if Lewis
properly effectuated service pursuant to § 1608 of the FSIA. The
plaintiff has the burden to demonstrate proper service on the
defendant. Hutchinson v. N.Y. State Corr. Officers, No. 02 Civ.
2407, 2003 WL 22056997, at *10 (S.D.N.Y. Sept. 4, 2003); Moultry
v. City of Poughkeepsie, 154 F. Supp. 2d 809, 812 (S.D.N.Y.
2001); AIG Managed Mkt. Neutral Fund v. Askin Capital Mgmt.,
L.P., 197 F.R.D. 104, 108 (S.D.N.Y. 2000). See also Sys.
Signs Supplies v. U.S. Dep't of Justice, 903 F.2d 1011, 1013
(5th Cir. 1990) ("[w]hen service of process is challenged, the
serving party bears the burden of proving its validity.").
A. Foreign Sovereign Immunities Act of 1976
The FSIA affords foreign nations immunity from lawsuits in
federal and state courts. See, e.g., 28 U.S.C. § 1604; see
also Kato v. Ishihara, 360 F.3d 106, 109-110 (2d Cir. 2004).
Designed "primarily to provide a unitary rule for determinations
of sovereign immunity in American courts," Gray v. Permanent
Mission of the People's Rep. of the Congo to the United Nations,
443 F. Supp. 816, 819 (S.D.N.Y. 1978), aff'd 580 F.2d 1044 (2d
Cir. 1978), the FSIA requires that "a foreign state shall be immune from the
jurisdiction of the courts of the United States and of the
States" unless a particular exception applies. Kato,
360 F.3d at 109-10 (internal quotations omitted). One such exception is
where the subject matter of the action is commercial in nature.
Id. at 110; see also 28 U.S.C. § 1605. In particular, a
court must determine whether the action engaged in by a private
party involves "trade and traffic or commerce." Kato,
360 F.3d at 111 (citing Rep. of Arg. v. Weltover, Inc., 504 U.S. 607,
The parties do not contest that the Mission is entitled to
immunity in accordance with the FSIA. Gray, 443 F. Supp. at 819
("there can be no doubt that the Congo Mission is a foreign
state"). The issue is whether the aforementioned exception
applies. The alleged activity, a construction contract, is
undeniably commercial. See Adler v. Fed. Rep. of Nig.,
219 F.3d 869, 875 (9th Cir. 2000) ("contract for services is plainly
commercial in nature"). As such, the Mission is not immune from
B. Definition of the Mission for Purposes of 28 U.S.C. § 1608
All entities covered by the FSIA must be served in accordance
with the exclusive procedures for service outlined therein.
See, e.g. Alberti v. Empresa Nicaraguense de la Carne,
705 F.2d 250, 253 (7th Cir. 1983); see also Fed.R.Civ.P.
4(j)(1). To determine whether service was properly effectuated
pursuant to § 1608, the Court must first determine whether the
Mission is a "foreign state," such that § 1608(a) applies, or,
conversely, whether the Mission is an "agency or instrumentality
of a foreign state," such that § 1608(b) applies. See
28 U.S.C. §§ 1608(a), (b).
It is well settled that a country's permanent mission to the
United Nations is a foreign state for the purposes of § 1608.
Gray, 443 F. Supp. at 820.*fn2 As such, the service
requirements of § 1608(a) apply. Id.
C. Service of Process Pursuant to FSIA
Section 1608(a) provides that service is to be made as follows:
(1) by delivery . . . in accordance with any special
arrangement for service between the plaintiff and the
foreign state or political subdivision; or
(2) if no special arrangement exists, by delivery . . .
in accordance with an applicable international convention on
service of judicial documents; or
(3) if service cannot be made under paragraphs (1) or
(2), by sending a copy of the summons and complaint
and a notice of suit, together with a translation of
each into the official language of the foreign state,
by any form of mail requiring a signed receipt, to be
addressed and dispatched by the clerk of the court to
the head of the ministry of foreign affairs of the
foreign state concerned, or
(4) if service cannot be made within 30 days under
paragraph (3), by sending two copies of the summons
and complaint and a notice of suit, together with a
translation of each into the official language of the
foreign state, by any form of mail requiring a signed
receipt, to be addressed and dispatched by the clerk
of the court to the Secretary of State . . .
28 U.S.C. § 1608(a).
Courts have been unequivocal that § 1608(a) "mandate[s] strict
adherence to its terms, not merely substantial
compliance."*fn3 Finamar Investors Inc. v. Rep. of
Tadjikstan, 889 F. Supp. 114, 117 (S.D.N.Y. 1995); see also
Gray, 443 F. Supp. at 820; see also Magness v. Russ.
Fed'n, 247 F.3d 609, 615 (5th Cir. 2001); see also BPA
Int'l, Inc. v. Kingdom of Swed., 281 F. Supp. 2d 73, 84 (D.D.C.
2003). Accordingly, defective service is rarely, if ever,
excused.*fn4 Transaero, Inc. v. La Fuerza Aerea Bol.,
30 F.3d 148, 154 (D.D.C. 1994); see Gerritsen v. Consulado
General de Mex., 989 F.2d 340, 345 (9th Cir. 1993) (failure to
include translation of complaint into Spanish rendered service
1. Special Arrangement and Applicable International Convention
It is undisputed that a special arrangement did not exist
between the parties which pertained to service of process. Thus,
service in accordance with § 1608(a)(1) is inapplicable.
Similarly, the parties have not stipulated to the applicability
of any particular international convention which may potentially
govern service. See § 1608(a)(2). Since the Mission is located
in the United States, the Hague Convention on Service Abroad of
Judicial and Extrajudical Documents is clearly inapplicable
because the judicial documents were not being transmitted abroad. Taft v. Moreau, 177 F.R.D. 201, 203 (D. Vt.
1997); see also Marschhauser v. Travelers Indem. Co.,
145 F.R.D. 605, 607 (S.D. Fla. 1992). Thus, service in accordance
with § 1608(a)(2) is inapplicable.
2. Section 1608(a)(3)
If no special arrangement exists and there is no applicable
convention, the FSIA details specific procedures to properly
serve a foreign state in the United States. See
28 U.S.C. § 1608(a)(3).
Among the specific procedures delineated in § 1608(a)(3) is the
requirement that the papers be served on the Minister of Foreign
Affairs of the foreign state concerned. The statute is clear that
a foreign ambassador to the United States or United Nations
cannot be construed as the Minister of Foreign Affairs.
Alberti, 705 F.2d at 253 ("plaintiffs have argued that the
Ambassador of Nicaragua can be construed as the Minister of
Foreign Affairs. The legislative history of FSIA, however, makes
clear that this is not a permissible construction of section
1608(a)(3)."). Rather, the FSIA designates the Minister of
Foreign Affairs as the only person eligible to receive service
because he is "most likely to understand American procedure."
Transaero, Inc., 30 F.3d at 154.
Lewis's three attempts at service, (1) the February 14 mailing,
(2) the March mailing, and (3) the April mailing, fail to
strictly comply with the procedures detailed in the FSIA.
First, in the February 14 mailing, a copy of the Summons and
Complaint were mailed, but failed to include a Notice of Suit.
While the papers were in English, the official language of
Botswana,*fn5 and the Summons and Complaint were properly
served on the County Clerk's Office which then sent them to the
Mission via "certified mailing," a manner which requires a
signature upon receipt, the specific addressee at the Mission was
not identified as mandated by the FSIA. In addition, Lewis failed
to indicate that service was mailed to the Minister of Foreign
Affairs. As such, the February 14 mailing fails to comply with §
1608(a)(3) in that it (1) did not include a copy of the Notice of
Suit and (2) was not addressed to the head of the ministry on
foreign affairs for Botswana.
Second, in the March mailing, a copy of all three required
papers the Summons, Complaint, and Notice of Suit were
mailed. However, Lewis failed to present support for certified
mail as required by the FSIA. In addition, while Lewis served the
County Clerk's Office, he failed to note the recipient. As such, the March
mailing fails to comply with § 1608(a)(3) in that it was not (1)
sent by certified mail and (2) addressed to the Minister of
Foreign Affairs for Botswana.
Third, in the April mailing, a copy of the Summons, Complaint,
and Notice of Suit were again delivered to the Mission. The
papers were sent by certified mail. However, Lewis' third attempt
was mailed by Lewis' attorney directly to Ambassador Dube. As
such, the April mailing fails to comply with § 1608(a)(3) in that
it was not (1) dispatched by the clerk of the court and (2)
addressed to the Minister of Foreign Affairs for Botswana.
Lewis, while making a valiant effort, failed to strictly comply
with subsection (3) on any of the three service dates and
accordingly, service was not properly effectuated pursuant to §
3. Section 1608(a)(4)
After service has been attempted under subsection (3) and 30
days have passed, a party may effectuate service pursuant to the
terms of § 1608(a)(4). McCarthy ex rel Estate of Anderson v.
Rep. of Cuba, 354 F. Supp. 2d 1347, 1348 (S.D. Fla. 2005).
Service cannot be made pursuant to § 1608(a)(4) if it can be made
pursuant §§ 1608(a)(1), (2), or (3). See Trans Commodities,
Inc. v. Kazakstan Trading House, No 96 Civ. 9782, 1997 WL
811474, at *4 (S.D.N.Y. May 28, 1997). Lewis does not contend
that he effectuated service pursuant to § 1608(a)(4).
4. The Dismissal for Improper Service
It is well established that the FSIA requires strict
compliance. As the Mission argued, the FSIA is a reciprocal
statute and the United States would expect no less were the facts
reversed. As such, while the motion to dismiss must be granted,
case law supports the proposition that the Court can dismiss the
Complaint without prejudice, but with the caveat that the matter
may be reinstated upon proper service within a reasonable period
of time.*fn6 This approach, which I adopt here, serves
several purposes and is in concert, at least philosophically,
with the Federal Rules. First, it saves the Court and the
Plaintiff time. Second, it aids in trying cases on their merits.
Finally, it is, in a very real sense, in the interests of
justice. III. FAILURE TO STATE A CLAIM
The Mission's references to Rule 12(b)(6) in the affirmation in
support of its motion to dismiss fail to include a single
argument or contention that would support dismissal. Such a
motion to be granted must show "that the plaintiff can prove no
set of facts in support of his claim which would entitle him to
relief." Shakur v. Selsky, 391 F.3d 106, 112 (2d Cir. 2004).
The Mission has failed to meet this heavy burden and that arm of
this omnibus motion must be DENIED.
The motion to dismiss for improper service is GRANTED. The
Complaint is DISMISSED without prejudice UNLESS Plaintiff
properly serves the Mission within 60 days from the date hereof.
The Mission's Rule 12(b)(6) motion is DENIED. The Clerk of Court
is instructed to CLOSE this motion and REMOVE it from my docket.
IT IS SO ORDERED.