Riotor v 534 Graham Ave. Hous. Dev. Fund Corp.

Supreme Court, Kings County

Decided on May 1, 2026

Index No. 511478/2025

Aaron D. Maslow, J.

The following numbered papers were used on this motion: NYSCEF Document Numbers 24-42, 44-55.

Upon the foregoing papers, the Court having elected to determine the within motion(s) on submission pursuant to 22 NYCRR 202.8-f and IAS Part 2 Rules § D6 ("All motions presumptively are to be argued in person unless the Court informs the parties at least two days in advance that it has made a sua sponte determination that a motion will be determined on [*2]submission."), and due deliberation having been had thereon,

It is hereby ORDERED as follows:

Plaintiff, a resident of an apartment at 534 Graham Avenue, Brooklyn, New York, complains of the Defendants 534 Graham Avenue Housing Development Fund Corporation and SLJ Property Management, LLC that she had to endure excessive, disturbing, and persistent noises throughout day and night emanating from the building's pipes. Her complaint alleged four causes of action: declaratory judgment, breach of contract, breach of warrant of habitability, and attorney's fees.

Defendants were served with the summons and complaint on April 17, 2025. No answer was interposed. Plaintiff now moves for leave to enter a default judgment.

"On a motion for leave to enter a default judgment pursuant to CPLR 3215, a plaintiff is required to submit proof of service of the summons and complaint, proof of the facts constituting the cause of action, and proof of the defendant's default in answering or appearing" (Knudsen v Green Machine Landscaping, Inc., 223 AD3d 792, 792-793 [2d Dept 2024]). Here, Plaintiff satisfied her CPLR 3215 burden of proving service, the facts constituting the claim, and the defendant's default (see Fried v Jacob Holding, Inc., 110 AD3d 56 [2d Dept 2013]). In point of fact, Defendants concede receipt of the summons and complaint.

In its opposition, Defendants submitted the affirmation of Leonard Jacobs, president of Defendant SLJ Property Management, LLC. Said Defendant is the property manager at the subject building. He affirmed that when the summons and complaint was received, he promptly forwarded it to Defendants' insurance agent, as was customary practice for all litigation. On April 30, 2025, he received confirmation from Donald Schatzle, the claim director at Defendants' insurance agent, Mackoul Risk Solutions, that the summons and complaint were forwarded to Defendants' insurers, Federal Insurance Co. and Glencar Insurance Co. The email correspondence from Mr. Schatzle was attached as an exhibit. On April 30, 2025, he also received confirmation from Network Adjusters, Inc., the third-party administrator for Glencar Insurance Company, that it received the information for this action; the confirmation was attached as an exhibit. As this action was sent to Defendants' general liability insurer and also the directors and officers' liability insurer, Defendants believed this matter was being litigated. Defendants later learned, after the time to answer or otherwise appear in this action had passed, that its insurers were denying coverage. Federal Insurance Company failed to advise Defendants it denied coverage until December 9, 2025, months after the time to appear in this action had passed; the denial of coverage notice was attached as an exhibit. The sole reason that Defendants did not appear in this action is that Defendants incorrectly believed that their insurance carriers retained counsel and were actively litigating this matter.

Mr. Jacobs also averred that when building personnel inspected the unit in which Plaintiff resided, they discovered that she had detached and removed some of the radiators. This was done without permission from Defendants. Plaintiff advised that she stored the radiators in the basement; also without permission. Plaintiff's unauthorized modifications to the pipes and heating system were dangerous and contributed to the malfunction in her unit. Defendant 534 Graham Avenue Housing Development Fund Corporation engaged Ferrantino Fuel Corporation ("Ferrantino") to inspect the heating system in Plaintiff's unit and the building, and make all necessary repairs to eliminate any banging noises and ensure the system was safe. The appurtenant invoice, dated March 11, 2025, was submitted as an exhibit. Ferrantino's work proposal was also attached as an exhibit. The work was substantial and was performed by [*3]Ferrantino between May 29, 2025 and June 3, 2025. 534 Graham Avenue Housing Development Fund Corporation expended $7,705.24 for Ferrantino to correct the issues in Plaintiff's unit. Another exhibit attached was Ferrantino's $7,705.24 invoice for the work performed.

A general assertion that a default in answering a complaint was occasioned by the defendant's insurance broker or liability carrier is insufficient (see Ahmed v Essex Terrace, Inc., 206 AD3d 866 [2d Dept 2022]; Glanz v Parkway Kosher Caterers, 176 AD3d 686 [2d Dept 2019]; Spitzer v Landau, 104 AD3d 936 [2d Dept 2013]; Trepel v Greenman—Pedersen, Inc., 99 AD3d 789 [2d Dept 2012]). A conclusory and unsubstantiated affidavit from the defendants' general manager indicating delay by either their insurance broker or insurance carrier does not suffice to establish a reasonable excuse for a default (see Glanz v Parkway Kosher Caterers, 176 AD3d 686). Conclusory and unsubstantiated assertions that a defendant's insurance carrier had been notified of the action and would be hiring counsel also does not suffice (see Ahmed v Essex Terrace, Inc., 206 AD3d 866). Merely forwarding papers to the insurer without taking any additional measures to ensure that the insurer would interpose a defense is insufficient (see Trepel v Greenman—Pedersen, Inc., 99 AD3d 789).

A detailed example of an insufficient excuse is described as follows:

Here, Billiard failed to provide a reasonable excuse for its approximately 10-month delay in answering. While Billiard's general manager, Jimmy Fok, averred in an affidavit that he forwarded a copy of the complaint to Billiard's insurance carrier, he also acknowledged that he was aware that coverage was disclaimed and that the disclaimer came "after the assignment of counsel but before an answer was interposed," during which time "efforts were made to have the disclaimer withdrawn." The disclaimer was issued on December 28, 2012, and the time within which Billiard was required to answer had been extended by one of the stipulations until January 11, 2013. While Fok averred that Billiard did not attempt "to avoid interposing an Answer," he acknowledged that he did nothing with regard to interposing an answer until after the motion for leave to enter judgment had been served by the plaintiff, at which time there was still an approximately 30-day delay between the service of the motion and the date of the verified answer. Thus, the delay was not attributable to insurance carrier delay (see Fried v Jacob Holding, Inc., 110 AD3d 56, 60-61 [2013]), but rather, resulted from Billiard's attempts and negotiations to alter the outcome of its insurance carrier's disclaimer. Under these circumstances, we find the excuse for Billiard's default unreasonable (see Jackson v Professional Transp. Corp., 81 AD3d 602, 603 [2011]; Dave Sandel, Inc. v Specialized Indus. Servs. Corp., 35 AD3d 790 [2006]; Lemberger v Congregation Yetev Lev D'Satmar, Inc., 33 AD3d 671, 672 [2006]; Gainey v Anorzej, 25 AD3d 650, 651 [2006]). (Gershman v Ahmad, 131 AD3d 1104, 1105-1106 [2d Dept 2015].)

In contrast, in the following situation, reliance on the insurance broker did suffice to excuse a default:

In its opposition, the defendant submitted detailed evidence showing that it had immediately faxed a copy of the summons and complaint to its insurance broker, who in turn faxed it to the defendant's insurer, but, apparently, to the wrong department (cf. Trepel v Greenman-Pedersen, Inc., 99 AD3d 789, 791 [2012]). When the defendant was served with the plaintiffs' motion for leave to enter a default judgment not long after the answer was due, the defendant immediately investigated the situation and sought to remedy it. This evidence showed that the default was not willful, the period of delay was [*4]very short, and there was no prejudice to the plaintiffs resulting from it. (Fried v Jacob Holding, Inc., 110 AD3d at 60-61.)

Hence, in an appropriate case, a court may take into account insurance-company delay in determining whether there is a reasonable excuse (see Ingvarsdottir v Gaines, Gruner, Ponzini & Novick, LLP [2d Dept 2016] [short delay in insurance carrier's efforts to assign counsel]).

The trial court was held not to have improperly exercised its discretion in accepting the defendant's explanation as a reasonable excuse for the default in the following circumstances:

The office manager averred that upon receiving the summons and complaint, the defendant forwarded them to Paramount Insurance Company (hereinafter Paramount), which was the insurance company that had handled the plaintiff's claim for Workers' Compensation benefits arising from the same incident. The officer manager further stated that Paramount did not disclaim coverage, and thus she mistakenly believed that it was defending the defendant in the instant action. She averred that it was not until she received a copy of the order granting the plaintiff's motion for a default judgment that she became aware of Paramount's nondefense of the action, and that the summons and complaint should have been sent to a different insurer. (Rekhtman v Clarendon Holding Co., Inc., 165 AD3d 856 [2d Dept 2018].)

Another instance of a trial court providently exercising its discretion to excuse a default was as follows: "Under the circumstances, including that upon being served, the defendant sent the complaint to his personal attorney instead of his insurance company, and upon receipt of the complaint, the insurance company served a verified answer less than three months after the time period in which to answer had expired, the defendant set forth a reasonable excuse for his delay in answering" (Yuxi Li v Caruson, 161 AD3d 1132, 1134 [2d Dept 2018]).

The circumstances here are more akin to those in Trepel v Greenman—Pedersen, Inc. (99 AD3d 789) and Gershman v Ahmad (131 AD3d 1104). While Mr. Jacobs did promptly send the summons and complaint to the insurance agent and received confirmation that the matter was in the hands of insurers or a third-party administrator, he did not inquire as to their progress in reviewing the lawsuit papers. It appears that eight months passed — until December 2025 — when a disclaimer was issued. Then, an answer was still not interposed. Believing that the insurance carrier was taking care of the matter does not suffice where the delay in answering is not brief. Even after the instant motion was served, there was no service of an answer. The Court holds that merely forwarding papers to the insurer without taking any additional measures as time passes — to ensure that the insurer will interpose a response — is insufficient. Waiting for an insurer to deal with a claim for most of a year without making at least one documented follow-up attempt displays a cavalier attitude by a sued defendant who bears a responsibility to respond. The lengthy delay here distinguishes this situation from that in Fried v Jacob Holding, Inc. (110 AD3d 56); Rekhtman v Clarendon Holding Co., Inc. (165 AD3d 856); and Yuxi Li v Caruson (161 AD3d 1132).

Therefore, while Defendants do offer a meritorious defense, they have failed to establish a reasonable excuse for their default.

It is hereby ORDERED that the within motion by Plaintiff seeking leave to enter a default judgment against Defendants 534 Graham Avenue Housing Development Fund Corporation and SLJ Property Management, LLC is GRANTED, and it is further

ORDERED that Plaintiff shall file a note of issue on or before June 5, 2026, and, per a contemporaneous referral, the matter is referred to a Special Referee or Judicial Hearing Officer [*5]for inquest.