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Snow v. SRE Wellness, Inc.
Snow v SRE Wellness, Inc. 2024 NY Slip Op 33790(U) October 23, 2024 Supreme Court, New York County Docket Number: Index No. 654391/2020 Judge: Debra A. James Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication.
INDEX NO. 654391/2020 NYSCEF DOC. NO. 25 RECEIVED NYSCEF: 10/23/2024
SUPREME COURT OF THE STATE OF NEW YORK NEW YORK COUNTY PRESENT: HON. DEBRA A. JAMES PART 59 Justice ----------------------------------------------------------------- ----------------X INDEX NO. 654391/2020 MATHEW SNOW, MOTION DATE 12/13/2020 Plaintiff, MOTION SEQ. NO. 001 - V -
SRE WELLNESS, INC., DECISION + ORDER ON MOTION Defendant. ------------------------------------------------------------------- --------------X
The following e-filed documents, listed by NYSCEF document number (Motion 001) 2, 12, 13, 14, 15, 16, 17, 18, 19,20,21,22,23,24 were read on this motion to/for JUDGMENT - SUMMARY IN LIEU OF COMPLAINT.
ORDER
Upon the foregoing documents, it is
ORDERED that the cross motion of defendant SRE Wellness,
Inc., to dismiss the complaint for lack of personal jurisdiction
over it is denied; and it is further
ORDERED that the motion, pursuant to CPLR § 3213, for summary
judgment in lieu of complaint of plaintiff Mathew Snow is granted,
and the Clerk of the Court is directed to enter judgment in favor
of plaintiff and against defendant in the amount of$ 214,641.10,
together with interest at the statutory rate per annum from the
date of June 30, 2020, until the date of the decision and order on
this motion, and thereafter at the statutory rate, as calculated
by the Clerk, together with costs and disbursements to be taxed by
the Clerk upon submission of an appropriate bill of costs.
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INDEX NO. 654391/2020 NYSCEF DOC. NO. 25 RECEIVED NYSCEF: 10/23/2024
DECISION
Plaintiff Mathew Snow ("Snow") commenced this action pursuant
to CPLR § 3213 to enforce an amended convertible Promissory Note
and Note Purchase Agreement (collectively, the "Note") issued by
the defendant SRE Wellness, Inc. ("SRE"). See NYSCEF Doc. Nos. 004
and 005.
SRE opposes the motion and cross-moves for dismissal
asserting that: ( 1) this court lacks personal jurisdiction over
SRE; (2) the Note is not a proper instrument for CPLR 3213; and
(3) that SRE amended the terms of the Note to remove the election
to receive cash instead of shares of SRE.
This court disagrees with SRE's contentions.
In general, the Note, and Snow's affidavit stating that
payment was duly demanded on July 17, 2020, and July 27, 2020, and
the lack of payment as evidenced by SRE's notice of conversion and
amendment to the Note, establish his prima facie entitlement to
summary judgment in lieu of complaint. Marj an Intl. Corp. v
Lillian August Designs, Inc., 225 AD3d 408, 409 (1st Dept 2024)
SRE's personal jurisdiction defense fails, even though it is
undisputed that Snow never posted proof of service upon the
Secretary of State on the docket of this action. Such failure is
not fatal to plaintiff's motion, as SRE acknowledges that it was
served via the Secretary of State, by admission of its own counsel
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INDEX NO. 654391/2020 NYSCEF DOC. NO. 25 RECEIVED NYSCEF: 10/23/2024
in his memorandum of law in opposition to plaintiff's motion and
support of its cross motion, to wit:
The Plaintiff had the summons, notice of motion and supporting papers delivered to the New York State Secretary of State. This Deli very was made on September 21, 2020. The Secretary of State thereafter delivered the papers to SRE's registered agent." NYSCEF Doc. No. 22, p. 4).
SRE, which is a corporate entity, erroneously argues that
Snow's failure to comply with the service requirements set forth
in CPLR § 308 is fatal to his motion for summary judgment in
lieu of complaint. CPLR § 308 is inapplicable to a corporate
entity, such as SRE, but applies to service upon a natural
person only. SRE's judicial admission that service was made (on
September 21, 2020) within one hundred twenty days of the filing
of the summon and motion for summary judgment in lieu of
complaint (on September 11, 2020) constitutes a failure on SRE's
part to object to Snow's failure to file his proof of service
pursuant to CPLR § 306-b. Given that admission, SRE has have
waived any objection to Snow's alleged failure to comply with
the filing requirement of CPLR 306-b. Clarke v Davis, 277 AD2d
902 (4th Dept 2000) ("By appearing in the action before the time
period provided in CPLR former 306-b[a] expired and failing to
raise an objection in his answer, defendant has waived his
objection to the filing requirement").
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As for SRE's argument that Snow is not entitled to summary
judgment pursuant to CPLR § 3213 as the Note is not an instrument
for the payment of money only, it is well established that "[t]he
conversion option contained in the note does not alter the fact
that the note is 'an instrument for the payment of money only' and
a proper subject of a motion pursuant to CPLR 3213", (Simon v
Indus. City Distillery, Inc., 159 AD3d 505, 505 [1st Dept 2018]).
Assuming, arguendo, that Amendment #1 to the Note Purchase
Agreement properly amends the Purchase Note Agreement, since there
is no Noteholder Election of Conversion, signed and delivered by
Snow, as required under Section paragraph 1. of such Amendment
(NYSCEF Doc. No. 007, p. 2), SRE has provided no proof that the
subject Note was converted into Series A Preferred Stock. See
Simon v Industry City Distillery, Inc., 159 AD3d 505, 506 (2019).
Snow seeks attorneys' fees that he incurred in enforcing the
Note. However, he has not demonstrated that he is entitled to
recover attorneys' fees, as no such remedy is set forth in either
the Note, Amended Note, Note Purchase Agreement or Amended Note
Purchase Agreement.
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INDEX NO. 654391/2020 NYSCEF DOC. NO. 25 RECEIVED NYSCEF: 10/23/2024
For the foregoing reasons, the cross motion of SRE to dismiss
the action for lack of personal jurisdiction shall be denied and
the motion of Snow for summary judgment in lieu of complaint shall
be granted.
P- ~ .A - } ~ 20241023133731DJAME503539AE2F9344309BB043510E32ABCCB
10/23/2024 DATE DEBRA A. JAMES, J.S.C. CHECK ONE: NON-FINAL DISPOSITION
□ GRANTED IN PART OTHER
APPLICATION: SUBMIT ORDER
□ CHECK IF APPROPRIATE: FIDUCIARY APPOINTMENT REFERENCE
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