Marinoff v. Natty Realty Corp.

In an action for specific performance of a contract to purchase real property, the plaintiff appeals from an order of the Supreme Court, Queens County (Price, J.), dated December 10, 2003, which denied his motion for leave to enter a default judgment against the defendant upon its failure to appear or answer the complaint, and granted the defendant’s cross motion to vacate its default in answering the complaint and for leave to serve a late answer. Ordered that the order is affirmed, with costs. The plaintiff commenced this action on April 9, 2003, and [413] served the defendant under Business Corporation Law § 306 by delivering copies of the summons, verified complaint, and notice of pendency to the Department of State in Albany on May 5, 2003. Since the defendant was not personally served within the State of New York, it had until June 4, 2003, to answer (see CPLR 3012 [c]). By October 2003 the defendant had not done so. By notice dated October 2, 2003, the plaintiff moved for leave to enter a default judgment against the defenda nt under CPLR 3215, upon its failure to appear or answer the complaint. The defendant cross-moved to vacate its default and for leave to serve a late answer. The defendant’s cross motion was premised, at least in part, on CPLR 317, which does not require the movant to establish a reasonable excuse for the delay in moving for vacatur (see Eugene Di Lorenzo, Inc. v Dutton Lbr. Co., 67 NY2d 138 [1986]; Rifelli v Fireside Homes Corp., 152 AD2d 629 [1989]). Even if the defendant was required to make that showing, under the circumstances, the Supreme Court correctly concluded that the defendant established a reasonable excuse for its delay. Moreover, the time between the defendant’s answering deadline and its cross motion for vacatur of its default (approximately five months), was relatively modest. Indeed, CPLR 317 allows a defaulting party who otherwise meets the statute’s requirements to defend the action within one year after obtaining knowledge of entry of the judgment, “but in no event more than five years after such entry” (CPLR 317). Here, no judgment has been rendered. In addition, there is no indication that the defendant was deliberately attempting to avoid notice of this action (see Eugene Di Lorenzo, Inc. v Dutton Lbr. Co., supra at 143; Samet v Bedford Flushing Holding Corp., 299 AD2d 404, 405 [2002]). It was not necessary for the defendant to establish the validity of its defense as a matter of law in order to obtain vacatur of its default in answering. The defendant carried the burden of demonstrating a potentially meritorious defense (see Eugene Di Lorenzo, Inc. v Dutton Lbr. Co., supra; Carnazza v Shoprite of Staten Is., 12 AD3d 393 [2004]; Becker v University Physicians of Brooklyn, 307 AD2d 243 [2003]). The Supreme Court providently exercised its discretion in concluding that the defendant carried its burden. Accordingly, the Supreme Court correctly denied the plaintiff s motion for leave to enter a default judgment against the defendant upon its failure to appear or answer the complaint, and correctly granted the defendant’s cross motion to vacate its default and for leave to serve a late answer. H. Miller, J.P., Schmidt, Ritter and Skelos, JJ., concur.