[*1]
Midland Funding LLC v Smuk
2011 NY Slip Op 50128(U) [30 Misc 3d 1219(A)]
Decided on February 8, 2011
City Court Of Albany
Heath-Roland, J.
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This opinion is uncorrected and will not be published in the printed Official Reports.


Decided on February 8, 2011
City Court of Albany


Midland Funding LLC d/b/a in New York as Midland Funding of Delaware LLC, Plaintiff,

against

Dana Smuk, Defendant.




CV 0117-10



Cohen & Slamowitz, LLP

Attorneys for Plaintiff

P.O. Box 9004

199 Crossways Park Drive

Woodbury, NY 11797

Anthony J. Pietrafesa, Esq.

Attorney for Defendant

210 Bell Court

Schenectady, NY 12303

Helena Heath-Roland, J.

Defendant moves for an order vacating and setting aside the within default judgment and restoring this action to the arbitration calendar. Defendant did not appear at the scheduled arbitration hearing and an award in favor of plaintiff was rendered based upon her default. In her motion, defendant explains that she did not appear because she did not receive notice of the arbitration hearing. Defendant further states that she did not receive the initial demand letter from Cohen & Slamowitz nor the summons and complaint. Defendant provides documentation demonstrating that she (1) filed a complaint with the New York State Consumer Protection Board after receiving a subsequent letter from plaintiff demanding the debt, (2) appeared before this Court and filed an answer after being advised by the Consumer Protection Board that a lawsuit had been filed and, finally, (3) after receiving notice of the arbitration award and then retaining counsel, had her attorney contact the Court on her behalf. Based upon this, the Court finds that defendant has demonstrated an intent to defend this action. The Court notes that defendant resides in a duplex home and has made a showing that there were issues with the service of her mail in this matter. [*2]

Accordingly, the motion is granted upon a showing of excusable default and in the interests of justice, conditioned upon defendant's remittance of payment to the Court of the arbitrator's fee of Seventy-Five ($75.00) Dollars [See 22 NYCRR §28.7(a)] within twenty-five (25) days of the date of this order. Upon the Court's receipt of the arbitrator's fee, the Clerk of the Court shall vacate the within judgment and restore this action to the arbitration calendar. If the Clerk does not receive plaintiff's payment, the judgment herein shall remain in full force and effect.

Defendant raised in her motion a defense of lack of personal jurisdiction, stating that the issue of personal jurisdiction "must be litigated." The Court notes that defendant did raise in her answer a lack of service of the complaint upon her. However, at this point, defendant has waived this defense by failing to move for dismissal upon this ground within sixty days of raising it in her answer, pursuant to CPLR 3211(e).

Additionally, defendant questioned why the Court set this matter down for mandatory arbitration prior to the parties having an opportunity for discovery. The Court placed this matter on the trial calendar without either party filing a Notice of Trial pursuant to the terms of UCCA §1301. Where any party appears unrepresented by counsel (as defendant did when she answered in a "pro se" capacity), UCCA §1301 requires the Court to place the matter on the trial calendar "upon joinder of issue", i.e., the service of a summons and complaint and an answer. Additionally, the matter involves a cause of action for money damages below the $6,000.00 threshold, and therefore the matter was referred to mandatory arbitration as required under 22 NYCRR Part 28.

Finally, plaintiff cites to CPLR Article 75 in opposition to the vacatur of the within default judgment, claiming, among other things, that defendant's motion to vacate the within arbitration award was not made within ninety (90) days after its delivery to him (pursuant to CPLR 7511). Plaintiff also alleges that defendant, in making his motion to vacate the award, was limited to the grounds listed in CPLR 7511(b). Article 75 of the CPLR applies to a written agreement to submit a controversy to "out of court" arbitration and does not apply to court mandated arbitration under the provisions of 22 NYCRR Part 28. Defendant's motion is brought on the grounds of excusable default, pursuant to CPLR 5015(a)(1) and 22 NYCRR §28.7, which require that the motion be made within one year of service of a copy of the judgment. Accordingly, the motion herein is timely made.

So ordered.

Dated at Albany, New York

February 8, 2011____________________________________

Helena Heath-Roland

Albany City Court Judge