The Plaintiff originally moved for an order striking the Defendant's Answer for failing to appear for a deposition, as noticed. The Defendant opposed that motion and cross-moved for an order dismissing the Complaint for failing to state a cause of action, pursuant to CPLR § 3211(a)(7), dismissing the complaint due to the Plaintiff's lack of capacity to maintain this action, pursuant to CPLR § 3211(a)(3), dismissing the Complaint due to the Plaintiff's failure to comply with CPLR § 3015(b), and imposing sanctions upon the Plaintiff and Plaintiff's counsel for frivolous conduct. The Plaintiff opposes the cross-motion.

The parties resolved the Plaintiff's motion by stipulation dated September 10, 2007, providing that all parties shall appear for depositions within ninety days after notice of entry of any order determining the Defendant's cross-motion, should the action survive. The court will not address the Plaintiff's motion.

That branch of the Defendant's motion to dismiss pursuant to CPLR § 3211(a)(7) is based upon the fact that the Plaintiff's fifth cause of action alleges that the Defendant breached a contract for temporary office staff to be provided by the Plaintiff by directly hiring one of the Plaintiff's employees, in violation of their agreement, and states that the parties' contract provided for the imposition of an $8,000.00 penalty in such an event. Arguing that the recovery of a penalty is prohibited, the Defendant asserts that the Plaintiff has failed to state a cause of action cognizable in law.

Those branches of the Defendant's motion to dismiss due to the Plaintiff's failure to comply with CPLR § 3015 and pursuant to CPLR § 3211(a)(3) are interrelated. The Plaintiff correctly points out that the Plaintiff has failed to plead its corporate status, as required by CPLR § 3015. The Defendant argues that this defect alone should serve as a basis for dismissing the Complaint, and further argues that this defect demonstrates the Plaintiff's lack of capacity to sue, [*2]mandating dismissal pursuant to CPLR § 3211(a)(3). In support of this latter argument, the Defendant alleges that there is no such corporation as "Horizon Staffing Solutions, Inc." registered in New York State as a domestic corporation and there is no foreign corporation authorized to do business in the State of New York in that name.In opposition to the Defendant's motion, the Plaintiff attempts to submit a letter from Sam D. Han, Esq. dated September 20, 2007 and the affidavit of Arthur Banks, who alleges that he is the Plaintiff's Managing Partner. Mr. Han's letter, which is neither affirmed nor sworn to, does not constitute competent evidence and shall not be considered by this court. CPLR § 2106; Simms v. APA Truck Leasing Corp., 14 AD3d 322, 788 NYS2d 63 (1st Dept. 2005); Baron v. Murray, 268 AD2d 495, 702 NYS2d 354 (2nd Dept. 2000); Bourgeois v. North Shore University Hosp. at Forest Hills, 290 AD2d 525, 737 NYS2d 101 (2nd Dept. 2002)

In opposition to the Defendant's motion, Mr. Banks alleges that the "penalty" provision of the parties' alleged contract to which the Complaint refers is actually a liquidated damages clause, designed to compensate the Plaintiff in the event the Defendant directly hires one of Plaintiff's employees. Mr. Banks further alleges that the Defendant violated the parties' agreement by directly hiring an employee of the Plaintiff.

In reply, the Defendant submits a copy of the purported contract, which provides, in pertinent part:

Client agrees not to directly or indirectly hire, or to use the services of any Candidates assigned to your company by Horizon Staffing Solutions within 1 year (12 months) after the last date of the assignment of the Candidate. In the event the Client or any of its affiliates, either (a) employs any Candidate on a permanent or temporary basis, (b) use any Candidate's services in a consulting or freelance capacity, (c) use any Candidate's service through another agency/search firm, client agrees to pay Horizon Staffing solutions liquidated damages in the amount of $8,000.00 per Candidate. It is hereby agreed that said damages are reasonable and appropriate to compensate Horizon Staffing Solutions for any damages it may incur.

This contractual provision notwithstanding, the Defendant argues that the Plaintiff is bound by the language used in the Complaint, which refers to this payment as a "penalty." The Defendant further argues that the name assigned to this payment is irrelevant, as the payment itself is unreasonable in relation to the anticipated damages at the time the parties entered into their contract, rendering this payment an unenforceable penalty.

That branch of the Defendant's motion to which seeks dismissal due to the Plaintiff's failure to comply with CPLR § 3015(b) is denied. The omission from the Complaint of an allegation concerning the Plaintiff's corporate status is not grounds for dismissal. Dari-Delight v. Priest & Baker, Inc., 50 Misc 2d 654, 271 NYS2d 355 (S.C. Nassau Co. 1966) CPLR § 3026 provides that "Pleadings shall be liberally construed. Defects shall be ignored if a substantial right of a party is not prejudiced." Similarly, CPLR § 3025(c) provides, in pertinent, "A party may amend his pleading, ... at any time by leave of court or by stipulation of all parties. Leave shall be freely given upon such terms as may be just including the granting of costs and continuances." While there is no question that the Plaintiff should have pled its corporate status, and specified "the state, country or government by or under whose laws the party was created," the Defendant was aware that the Plaintiff put itself forth herein as a corporation and that the Summons listed the Plaintiff's location as 2001 Marcus Avenue, Suite E240, Lake Success, New York. Moreover, this technical defect may be cured upon a proper motion by the Plaintiff to [*3]amend its Complaint.

That branch of the Defendant's motion which seeks dismissal pursuant to CPLR § 3211(a) (3), alleging the Plaintiff's lack of capacity and/or lack of standing, which are separate and distinct legal concepts, Silver v. Pataki, 96 NY2d 532, 730 NYS2d 482 (2001); Graziano v. County of Albany, 3 NY3d 475, 787 NYS2d 689 (2004);Caprer v. Nussbaum, 36 AD3d 176, 825 NYS2d 55 (2nd Dept. 2006) is denied. "Under CPLR 3211(e), any objection or defense based on a ground set forth in subdivision (1), (3), (4), (5), or (6) of CPLR 3211(a) must be raised in an answer or in a motion made before the answer is due, or it is waived." Wells Fargo Bank Minnesota, Nat. Ass'n v. Mastropaolo, 42 AD3d 239, 837 NYS2d 247 (2nd Dept. 2007) Neither the Defendant's Amended Verified Answer nor Second Amended Verified Answer raise the Plaintiff's alleged lack of standing or capacity; and, the Defendant failed to make a pre-answer motion seeking dismissal on these grounds. Accordingly, the Defendant has waived these defenses, which cannot now be heard in this tardy motion. Harte v. Richmond County Sav. Bank, 224 AD2d 585, 638 NYS2d 684 (2nd Dept.1996); Muchnick v. Alcamo Supply and Contracting Corp., 169 AD2d 711, 564 NYS2d 198 (2nd Dept.1991); FBB Asset Managers, Inc. v. Freund, 2 AD3d 573, 769 NYS2d 301 (2nd Dept. 2003)

In determining a motion to dismiss pursuant to CPLR § 3211(a)(7), which has not been converted to a motion for summary judgment, the pleading must be construed in a light most favorable to the pleader; and, all factual allegations must be accepted as true. See, Grand Realty Co. v. City of White Plains, 125 AD2d 639, 510 NYS2d 172 (2nd Dept. 1986); Barrows v. Rozansky, 111 AD2d 105, 489 NYS2d 481 (1st Dept. 1985); Rosen v. Watermill Development Corp., 1 AD3d 424, 786 NYS2d 474 (2nd Dept. 2003) Dismissal will only be warranted where it is conclusively established there is simply no cause of action. Town of North Hempstead v. Sea Crest Construction Corp., 119 AD2d 744, 501 NYS2d 156 (2nd Dept.1986); Fields v. Leeponis, 95 AD2d 822, 463 NYS2d 864 (2nd Dept. 1983) If the pleading contains factual allegations which taken together manifest any cause of action cognizable at law, the motion must be denied, Becker v. Schwartz, 46 NY2d 401, 413 NYS2d 895 (1978); Natural Organics, Inc. v. Smith, 38 AD3d 628, 832 NYS2d 76 (2nd Dept. 2007); Aranki v. Goldman & Associates, LLP, 34 AD3d 510, 825 NYS2d 97 (2nd Dept. 2006)

The Defendant's motion to dismiss the entire Complaint overlooks the fact that the Complaint sets forth a total of five causes of action, the first four of which clearly set forth a claim for money allegedly due and owing for temporary staffing services provided to the Defendant by the Plaintiff. The Defendant makes no argument as to why these first four causes of action should be dismissed; and, there is, in fact, no basis for their dismissal at this time.

As previously indicated, the Defendant does argue that the Plaintiff's use of the word "penalty," in its fifth cause of action, to describe the monies allegedly owed to the Plaintiff due to the Defendant's allegedly hiring of the Plaintiff's employee, mandates the dismissal of this claim. While contract provisions providing for the imposition of a penalty will be unenforceable, Zervakis v. Kyreakedes, 257 AD2d 619, 684 NYS2d 291 (2nd Dept.1999); JMD Holding Corp. v. Congress Financial Corp., 309 AD2d 645, 765 NYS2d 848 (1st Dept. 2003); Ann-Par Sanitation, Inc. v. Town of Brookhaven, 23 AD3d 380, 804 NYS2d 758 (2nd Dept. 2005), "It is well settled that parties to an agreement may provide for the payment of liquidated damages upon its breach, and such damages will be upheld if (1) the amount fixed is a reasonable measure [*4]of the probable actual loss in the event of breach, and (2) the actual loss suffered is difficult to determine precisely ( see, Truck Rent-A Center v. Puritan Farms, 41 NY2d 420, 393 NYS2d 365, 361 NE2d 1015; City of Rye v. Public Serv. Mut. Ins. Co., 34 NY2d 470, 473, 358 NYS2d 391, 315 NE2d 458; see also, Lavington v. Edgell, 127 AD2d 155, 512 NYS2d 817)." Willner v. Willner, 145 AD2d 236, 538 NYS2d 599 (2nd Dept.,1989); see also: Quaker Oats Co. v. Reilly, 274 AD2d 565, 711 NYS2d 498 (2nd Dept. 2000)

While the Plaintiff's use of the word "penalty" in its Complaint was, at best, inartful, "affidavits may be used freely to preserve inartfully pleaded, but potentially meritorious, claims (citations omitted)" Rovello v. Orofino Realty Co., 40 NY2d 633, 389 NYS2d 314 (1976); see also: Cron v. Hargro Fabrics, Inc., 91 NY2d 362, 670 NYS2d 973 (1998); Arrington v. New York Times Co., 55 NY2d 433, 449 NYS2d 941 (1982) Keeping in mind that upon determining a CPLR § 3211(a)(7) motion, "[t]he criteria is whether the proponent of the pleading has a cause of action, not whether he has stated one[]" Guggenheimer v. Ginzburg, 43 NY2d 268, 401 NYS2d 182 (1977); See also: Leon v. Martinez, 84 NY2d 83, 614 NYS2d 972 (1994), the use of the word "penalty," at the pleading stage, will not be fatal to the Plaintiff's cause of action, particularly where, as here, Mr. Banks' affidavit and the alleged contract submitted by the Defendant make plain that what the Plaintiff is seeking are alleged liquidated damages.

It is undisputed that the alleged contract, which forms the basis of the Plaintiff's claim, contains a provision for the payment of "liquidated damages" in the event the Defendant directly hires one of the Plaintiff's employees. There is no doubt, given this contractual provision, that had the Plaintiff used the words "liquidated damages" instead of "penalty" in its Complaint the factual allegations set forth in the Plaintiff's fifth cause of action would state a cause of action cognizable at law. The name given to the claim for damages is unimportant. "Such an approach would put too much faith in form and too little in substance." Truck Rent-A-Center, Inc. v. Puritan Farms 2nd, Inc., 41 NY2d 420, 393 NYS2d 365 (1977) What is important is that the Defendant is aware of the contract provision and has been made aware that the Plaintiff seeks the recovery of damages for its alleged breach. Whether or not the Plaintiff will ultimately prevail in enforcing the liquidated damages provision of this alleged contract need not be determined at this time. Sanders v. Winship, 57 NY2d 391, 456 NYS2d 720 (1982); Guren v. County of Suffolk, 187 AD2d 560, 590 NYS2d 217 (2nd Dept. 1992); Bovino v. Village of Wappingers Falls, 215 AD2d 619, 628 NYS2d 508 (2nd Dept. 1995)

Accordingly, that branch of the Defendant's motion which seeks to dismiss the Complaint for failing to state a cause of action is denied.

That branch of the Defendant's motion seeking the imposition of sanctions against the Plaintiff and Plaintiff's counsel is denied.

This constitutes the decision and order of this court.

Dated: Hempstead, New York

November 15, 2007

___________________________ [*5]

ANDREW M. ENGEL

J.D.C.