REPORT and RECOMMENDATION
KEVIN NATHANIEL FOX, Magistrate Judge.
TO THE HONORABLE LORNA G. SCHOFIELD, UNITED STATES DISTRICT JUDGE
Before the Court, in this action brought pursuant to the court's diversity jurisdiction, are: (1) plaintiff Capital One National Association's ("Capital One") motion for the "entry of final judgment of foreclosure and sale, " with respect to two (2) condominium units and seven (7) parking spaces in a 72unit condominium edifice located in New York County; and (2) defendants 48-52 Franklin, LLC's ("48-52 Franklin") and Marshall Weisman's ("Weisman") cross-motion "to dismiss the action for lack of jurisdiction and/or for a Court Order to vacate their default." The motions are addressed below.
Capital One's predecessor-in-interest, the North Fork Bank, provided financing to 48-52 Franklin, a New York limited liability company, for its development of the 72-unit condominium structure, through three (3) mortgages and corresponding notes dated December 21, 2007. The loan documents were executed by Weisman, on behalf of 48-52 Franklin, in his capacity as that entity's manager. To induce Capital One to provide the financing, Weisman, in his individual capacity, executed a payment and performance guaranty "guaranteeing the full, prompt, and unconditional payment, " when due, of 48-52 Franklin's debt obligations to Capital One, under the loan documents referenced above. Based upon amendments to the loan documents, the maturity date of the notes was extended to November 30, 2011. However, according to Capital One, 48-52 Franklin and Weisman defaulted on their obligations to it by failing to pay all the amounts due on the maturity date of the notes. As a consequence, Capital One contends that $1, 612, 302.69 are owed to it by 48-52 Franklin and Weisman. Capital One served a summons and complaint on all the defendants and none filed an answer to, or otherwise defended against, the complaint. Thereafter, in June 2012, Capital One requested, pursuant to Rule 55(a) of the Federal Rules of Civil Procedure, that the Clerk of Court enter the default of each defendant, save for defendant CM and Associates Construction, which entered into a stipulation with Capital One extending its time to answer, move or otherwise respond to the complaint. Counsel to CM and Associates Construction also filed a "Notice of Limited Appearance and Waiver, " with the court through which he waived
service of all further papers in this action, except the following: a) order appointing Referee to compute the sums due and owing to the plaintiff; b) notice of hearing before Referee to determine the sums due and owing to plaintiff; c) Referee's report and computation of the sums due and owing to the plaintiff; d) notice of motion and/or application on behalf of the plaintiff for summary judgment and/or a judgment of foreclosure and sale along with the supporting papers; e) judgment of foreclosure and sale entered in the above-entitled action; f) notice of sale with a true copy thereof to be served at least twenty (20) days before the scheduled date of sale; g) notice of any and all pleadings to discontinue the action; h) notice of any and all proceedings to obtain surplus money; and i) notice of any and all proceedings to obtain a deficiency judgment.
On October 11, 2012, the Clerk of Court granted Capital One's Rule 55(a) request and entered a default against all the defendants except CM and Associates Construction.
On November 12, 2012, Capital One filed the instant motion "for the entry of final judgment of foreclosure and sale." The Honorable Barbara S. Jones, to whom this case was then assigned, entertained the motion - characterizing it as a motion "for entry of default judgment." On November 30, 2012, through an order, she granted the motion and "enter[ed] a default judgment" against defendants Weisman, the New York City Bureau of Highway Operations and Creative Habitats, Inc. In that same order, Judge Jones referred the matter to the undersigned magistrate judge "for purposes of conducting an inquest to determine the appropriate amount of damages owed to Plaintiff with respect to the defaulted defendants."
Judge Jones refrained from entering the default judgment against 48-52 Franklin because she had received a letter from "Abraham Hoschander ["Hoschander"], who [purported] to represent Defendant 48-52 Franklin but who [had] not filed a notice of appearance" on its behalf. Hoschander requested "an opportunity to oppose Plaintiff's motion for default judgment against 48-52 Franklin and to cross-move for dismissal against Plaintiff." Judge Jones granted his request and directed 48-52 Franklin "to submit its motion in opposition to Plaintiff's motion for default judgment and its motion to dismiss the Complaint on or before December 14, 2012." She directed Capital One to "reply to [48-52 Franklin's] motion in opposition to default judgment and [to] oppose [48-52 Franklin's] motion to dismiss on or before December 28, 2012." 48-52 Franklin was directed to submit any reply on or before January 4, 2013.
After several failed attempts to file their cross-motion through the court's Case Management/Electronic Case Filing system, 48-52 Franklin and Weisman succeeded in filing their crossmotion on January 28, 2013. In support of that motion, the cross-movants submitted a "certification" by Weisman and a memorandum of law. The cross-movants contend, through their memorandum of law, that service of process upon 48-52 Franklin "was improper, " because the methods set forth in Rule 4 of the Federal Rules of Civil Procedure for serving a corporation with process were not employed. Fed R. Civ. P. 4(e)(1), made applicable here by Fed.R.Civ.P. 4(h)(1)(A), directs that service be accomplished by "following state law for serving a summons in an action brought in courts of general jurisdiction in the state where the district court is located or where service is made." Fed.R.Civ.P. 4(e)(1).
The cross-movants contend that "under New York State law, CPLR § 311 provides that personal service upon a Corporation [sic] can be made by delivering the Summons [sic] to an Officer, Director, Managing Agent or General Agent or Cashier or Assistant Cashier or any other Agent authorized by appointment or by Law [sic] to receive service. The Statute [sic] also provides that the Corporation [sic] may be served pursuant to Section [sic] 306 of the Business Corporation Law of the State of New York. In the instant [sic] neither of the above alternatives was used." According to the cross-movants "[t]he only service attempted [on 48-52 Franklin] was on a member of MR. WEISMAN'S [sic] household who was not affiliated with the Corporate Defendant." The cross-movants assert that "[m]erely serving a member of MR. WEISMAN'S [sic] household who was not at all related to the Corporation cannot be effective service as a matter of Law [sic]." "Therefore, [according to the cross-movants, ] under Rule 4, service was improper."
Furthermore, the cross-movants maintain that service was defective because, "as a matter of Contract [sic] it was negotiated in all of the loan Agreements and Amendments to the loan Agreement [sic] that any documents must be served to a specific address for MR. WEISMAN [sic] with a copy to his Attorney[sic, and] the Summons [sic] was not sent to the address indicated in the papers nor to [Weisman's] Attorney [sic]." The cross-movants contend that, owing to the failure of Capital One to comply with the contractual provision referenced above, they were prejudiced, because Weisman "never saw the papers which were most likely taken by a member of his household and put in a box with other legal papers [and, as a consequence, h]e knew nothing of the existence of the action until informed by a Co-Defendant." Thereafter, according to the cross-movants, Weisman "immediately hired an Attorney [sic] who requested an extension of time. Although the answer was overdue by a period of approximately two (2) weeks, the Plaintiff nevertheless refused any requested [sic] for the adjournment." Accordingly, the cross-movants request that the court dismiss this action "for lack of jurisdiction and/or [that the court] allow the Defendants to answer and assert their defenses to this action."
For its part, Capital One asserts that 48-52 Franklin and Weisman were served with the summons and complaint on May 9, 2012, as indicated in its process server's affidavits of service, which are Exhibits A, B, and C to the certification submitted by its counsel, Eduardo J. Glas, in opposition to the cross-motion. Capital One contends that the cross-movants' reliance on New York Civil Practice Law and Rules ("CPLR") § 311, in urging that the court find service on 48-52 Franklin was improper, is misplaced because 48-52 Franklin is not a corporation, but is a limited liability company. ...