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Kinlay v. Henley

NEW YORK SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT


December 2, 2008

JONATHAN KINLAY, ET AL., PLAINTIFFS-APPELLANTS,
v.
RONALD HENLEY, ET AL., DEFENDANTS-RESPONDENTS,
HENLEY WILMOTT CAPITAL, LLC, ET AL., DEFENDANTS,
CAISSA FUND MANAGEMENT, LLC, ET AL., NOMINAL DEFENDANTS.

Order, Supreme Court, New York County (Herman Cahn, J.), entered November 21, 2007, which granted defendants-respondents' motion to dismiss all claims pleaded by the corporate plaintiff, unanimously reversed, on the law, with costs, the motion denied, and the claims of the corporate plaintiff reinstated.

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This opinion is uncorrected and subject to revision before publication in the Official Reports.

Mazzarelli, J.P., Saxe, Catterson, Renwick, Freedman, JJ.

602886/04

The individual plaintiff is the owner and chief executive officer of the corporate plaintiff. Two months after plaintiffs' attorney was relieved by the court, defendants moved to dismiss the claims of the corporation pursuant to CPLR 321(a), which requires a corporation to appear by an attorney. The corporation then assigned all of its claims in the action to the individual plaintiff, admittedly to evade CPLR 321(a), a perfectly legitimate tactic (Kamp v In Sportswear, 39 AD2d 869 [1972], revg on dissenting opn at App Term, 70 Misc 2d 898 [1972]; see also Medical Facilities v Pryke, 172 AD2d 338 [1991]; Traktman v City of New York, 182 AD2d 814 [1992]). Nevertheless, the motion court dismissed the corporation's claims, finding the assignment to be "obviously a ploy" to avoid the law. On appeal, defendants acknowledge that good consideration was given for the assignment and do not otherwise challenge its validity. Instead they appear to argue that the appeal should be dismissed because the corporation fell into default once it purported to maintain the action without counsel, that the motion court's dismissal of the corporation's claims was in effect a default judgment, that no appeal lies from a default judgment, and that the corporation's remedy is to retain counsel and move to vacate its default. The argument is contrary to the above authorities and lacks merit. The individual plaintiff has obtained all of the corporation's claims, and thus CPLR 321(a) does not apply.

THIS CONSTITUTES THE DECISION AND ORDER OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

20081202

© 1992-2008 VersusLaw Inc.



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