SUPREME COURT OF THE STATE OF NEW YORK APPELLATE TERM: 2nd, 11th and 13th JUDICIAL DISTRICTS
April 26, 2011
AUTUMN COURT, LLC,
GUTMAN, MINTZ, BAKER & SONNENFELDT, P.C. NONPARTY-APPELLANT;
ANGELA FRANCISCA SALCEDO,
Appeal from an order of the Civil Court of the City of New York, Kings County (Noach Dear, J.), dated December 14, 2009.
Autumn Ct., LLC v Salcedo
Decided on April 26, 2011
Appellate Term, Second Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.
PRESENT: PESCE, P.J., WESTON and GOLIA, JJ.
The order, insofar as appealed from, directed nonparty-appellant, Gutman, Mintz, Baker & Sonnenfeldt, P.C., to pay $1,000 in costs to nonparty-respondent Angela Francisca Salcedo and to pay a sanction of $1,000 to the Lawyers' Fund for Client Protection.
ORDERED that on the court's own motion, the notice of appeal is treated as an application for leave to appeal, and leave to appeal is granted (see CCA 1702 [c]); and it is further,
ORDERED that the order, insofar as appealed from, is reversed, without costs, and the award of costs and sanctions is vacated.
Plaintiff landlord, by its attorneys, Gutman, Mintz, Baker
& Sonnenfeldt, P.C. (the Gutman firm), commenced this action against defendant Angela Salcedo, its former tenant, to recover
rent arrears. After process was served and defendant failed to appear or answer, a default judgment in the total amount of $3,566.10
was entered against her, and a restraint was placed on the Citibank bank account of Angela Salcedo. Thereafter, one Angela Francisca
Salcedo, who resided in a different apartment at the same address as defendant, moved to vacate the default judgment as well as "any liens
and income executions," stating that her bank account had been restrained, but that she was not the Angela Salcedo who had been named as
the defendant in the action. Her motion was granted provided that she serve an answer within 20 days of the order and, upon compliance with that
condition, all post-judgment enforcement executions and restraints would be vacated and any amounts that may have been collected in the
enforcement of the judgment would be returned to her. Should the order not be complied with, the judgment would stand in full force and effect and
plaintiff would be entitled to enforce the judgment. After she failed to serve an answer, she was given, in a subsequent order, additional time to do
so, and all restraints and holds on her bank account were to be "vacated forthwith." Enforcement of the judgment previously obtained by plaintiff
was stayed until trial or other resolution of the matter. In her answer, she stated, among other things, that she did not owe the debt and that she had
been the victim of identity theft or mistaken identity.
On the scheduled trial date of September 25, 2009, the Civil Court, instead of proceeding to trial, on its own motion, orally ordered a sanctions hearing pursuant to Rules of the Chief Administrator of the Courts (22 NYCRR) part 130. Following the sanctions hearing, the Civil Court determined, among other things, that the Gutman firm had engaged in "frivolous conduct" as defined by the Rules of the Chief Administrator of the Courts (22 NYCRR) § 130-1.1 (c), and, by order dated December 14, 2009, directed the Gutman firm to pay costs of $1,000 to "Angela Francisca Salcedo, for reimbursement of reasonable expenses incurred in this matter" and to pay a sanction in the sum of $1,000 to the Lawyers' Fund for Client Protection.
In our opinion, the Civil Court improvidently exercised its discretion, following the sanctions hearing, in ordering the Gutman firm to pay costs and sanctions. While the Civil Court determined that the Gutman firm's failure to rectify its mistake of restraining the wrong Angela Salcedo's bank account and that the firm's failure to thoroughly investigate the matter of two Angela Salcedos who resided at the same address amounted to "frivolous conduct" warranting the imposition of costs and sanctions, we are of the opinion that the firm's actions and investigation of the matter were sufficient under the circumstances. Furthermore, we note that there was no basis in the record for the award of $1,000 in costs because there was no evidence of any "actual expenses reasonably incurred" by Angela Francisca Salcedo (Rules of Chief Administrator of Cts [22 NYCRR] § 130-1.1 [a]). In view of the foregoing, and since the conduct of the Gutman firm was not frivolous within the meaning of Rules of the Chief Administrator of the Courts (22 NYCRR) § 130-1.1, the Civil Court's award of costs and sanctions was not warranted. Accordingly, the order, insofar as appealed from, is reversed and the award vacated.
Pesce, P.J., Weston and Golia, JJ., concur.
Decision Date: April 26, 2011
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