desicion and order 2 10 2010

8/9/2019 Desicion and Order 2 10 2010

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CITY COURT OF THE CITY OF RENSSELAERCOUNTY OF RENSSELAER

NORTH GREENBUSH DEMOCRATIC COMMITTEE,

-against-JEFFREY SPAIN,

(City Court, City ofRensselaer)Index No. SC-9043

Plaintiff,

Defendant.

(Judge Carmelo Laquidara, Presiding)APPEARANCES:

LAQUIDARA, J.:

Michael J. Derevlany, Esq.Attorney for PlaintiffA. Joshua Ehrlich, Esq.Attorney for Defendant

DECISIONAND

OIillER

Plaintiff North Greenbush Democratic Committee (hereinafter referred to as plaintiff orthe Committee) commenced the instant small claim action seeking to recover $4,051.71 fromdefendant Jeffrey Spain, alleging a breach of fiduciary duty, conversion, and negligence.Defendant submits an answer and, at the same time, moves to dismiss the claim on a variety ofgrounds. Plaintiff opposes the dismissal motion.

This claim arises from allegations that defendant - the then-Chair Person of theCommittee - improperly liquidated the Committee's account following a leadership change.Plaintiff contends that, during the relevant time period of September 2008, defendant had control

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of the Committee's financial records. No dispute exists that defendant disbursed the followingcharitable contributions from the Committee's funds : (1) $1,200 to the Amanda's Journey Fund;(2) $1,000 to the Fast Break Fund; (3) $1,000 to Patriot Flight, Inc.; (4) $337.00 to Twin TownLittle League; and (5) $338.00 to Classie Lassie. Plaintiff also contends that defendant disbursed$176.71 for a web browser fee, which it alleges it did not use. In September 2009, plaintiffdemanded that defendant reimburse it $4,051.71, which defendant has apparently refused to do.On December 8, 2009, plaintiff filed the instant small claim. Concurrently with answering theclaim and pursuant to CPLR 3211 (a), defendant seeks an order dismissing the claim upon a

variety of grounds. At a December 8, 2009 Court appearance regarding this claim, the Court seta scheduling order for the instant motion practice. Pursuant to that schedule, the motion is nowfinally submitted.

First, defendant argues that the Court lacks subject matter jurisdiction over the claim.Defendant contends that plaintiff is a "constituted committee" as defined by the Election Lawand, as such, its receipts and expenditures are controlled by the Election Law. Thus, defendantmaintains that this matter is an "Election Law action, [and] it must be brought pursuant to Article16, specifically 16-100, 16-102 and 16-114, of the Election Law or Article 78 of the CPLR"in Supreme Court (Answer at 2).

This argument lacks merit. "Election Law 16-100 (1) broadly provides that 'thesupreme court is vested with jurisdiction to summarily determine any question of law or factarising as to any subject set forth in this article, which shall be construed liberally'" (Matter ofBreitenstein v Turco, 254 AD2d 566, 567 [3d Dept 1998], quoting Election Law 16-100 [I];see also Austin v Delligatti, 137 Misc. 2d 530, 532 [Sup Ct, Nassau County 1987]). "Election

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Law 16-116 makes clear, however, that a proceeding under the Election Law is a 'specialproceeding' and, hence a party may seek relief only in the form and to the extent that ElectionLaw article 16 expressly permits" (Mauer ofBreitenstein, 254 AD2d at 567).

Here, a review ofElection Law 16-100, 16-102 and 16-114, expressly relied upon bydefendant, does not indicate that any authority exists for a proceeding seeking reimbursement offunds allegedly improperly disbursed by an officer of a committee to be commenced in SupremeCourt (see Austin, 137 Misc 2d at 532). For instance, section 16-102 allows the commencementof a proceeding as to designations and nominations in primary elections (see Election Law 16-102; see also Austin, 137 Misc 2d at 532). Section 16-114 allows for a proceeding to compel thefiling of statements or corrected statements of campaign receipts or expenditures andcontributions (see Election Law 16-1 14; see also Austin, 137 Misc 2d at 532). In the instantclaim, there are no allegations that defendant did not file the proper statement of receipts andexpenditures with the Board of Elections and evidence of such filing is attached to plaintiffsopposition. Thus, defendant has not demonstrated that this claim should have been broughtunder article 16 of the Election Law in Supreme Court. Accordingly, this branch of defendant'smotion to dismiss is denied.

Next, defendant contends that this claim should be dismissed since venue is improper.Defendant argues that, since no parties to this claim reside in the City ofRensselaer and all ofthem reside in the Town ofNorth Greenbush, venue is improper. This argument lacks merit.

Uniform City Court Act 207 provides that this Court "shall have jurisdiction of smallclaims as defined in article 18 of this act." Under article 18,

[t]he term 'small claim' or 'small claims' as used in this act shall mean andinclude any cause of action for money only not in excess of five thousand dollars

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exclusive of interest and costs, provided that the defendant either resides, or hasan office for the transaction of business or a regular employment, within thecounty [emphasis supplied] (see also Uniform City Court Act 1801-A; Germainv CNYMgt. Corp., 121 Misc 2d 871, 871 -872 [Albany City Ct 1983]).

Moreover, to bring a money action in this Court, "a plaintiff or defendant must . . . be a residentof the city or of a town contiguous to such city, provided that such town is . . . within the samecounty and . . .contiguous to the city by land . . . " (Uniform City Court Act 213 [a]). Here, asdefendant acknowledges, both parties are residents of the Town ofNorth Greenbush, which islocated in Rensselaer County and contiguous to the City ofRensselaer. Accordingly, plaintiffproperly commenced this action in this Court, and, thus, this branch of defendant's motion isdenied.

As to the third branch of his motion to dismiss, defendant contends that this claim shouldbe dismissed since

[t]his is a political vendetta between factions of the North Greenbush DemocraticCommitte[ e]. The Defendant was the Chair from October of 2007 to October2009. This action was brought to involve and use the Court in a political dispute[a]s well as an attempt to punish the defendant for ousting the current leadershiptwo years ago (Answer at 8).

Defendant maintains that this Court should neither intervene nor interfere with the workings of aparty.

As cited by defendant, settled case law holds that "[Clourts should be most reluctant tointerfere with the internal affairs of a political party" (Bloom v Notaro, 67 NY2d 1048, 1049[1986]; see Matter ofEssenberg v Kresky, 265 AD2d 664, 667 [3d Dept 1999]; Matter ofBachmann v Coyne, 99 AD2d 742, 742 [2d Dept 1984], Iv denied 61 NY2d 207). In large part,the determination for a Court to exercise its discretion to entertain such a matter rests on whethera Court is interpreting rules already in place by such a political organization or whether a Court is

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being asked to help create internal guidelines (compare Matter ofKeukelaar v Monroe CountyBd. ofElections, 307 AD2d 1073, 1073-1074 [4th Dept 2003], Iv denied 100 NY2d 508[determining that respondents violated party rules regarding a chairperson's attendance at andacknowledgment of the nomination of a candidate for office], with Bloom, 67 NY2d at 1049[reversing Appellate Division's appointment of a supervisor with authority to rule on internalmatters before the State Committee of the Liberal Party]; Matter o fEssenberg, 265 AD2d at 667[declining to intervene before a removal process was complete where Election Law providedreview following such a process]). Here, as developed to date, this claim seeks reimbursement offunds allegedly improperly disbursed by defendant. Thus, the Court does not appear to be askedto either intervene or interfere with the internal affairs of a political party. Rather, the Court isbeing asked to determine whether defendant owes money to plaintiff based on his actions underthe committee structure. Accordingly, the Court will not dismiss the claim based on this ground.

As to the fourth branch of his motion, defendant contends that the claim should bedismissed since it effectively seeks equitable relief in the form of an accounting that is beyondthe jurisdiction of this Court. Certainly, Rensselaer City Court is a court of limited jurisdiction(see Trombley v Sorrelle, 6 Misc 3d 393, 397 [Watertown City Ct 2004], citing Siegel, NY Prac, 581), and, as such, lacks jurisdiction to entertain an action necessitating an accounting (seeBriscoe v White, 8 Misc 3d 1,3-4 [App Term, 2d Dept 2004]; see also Bury v CIGNA HealthcareofNY, Inc., 254 AD2d 229, 229 [1" Dept 1998] [City Court has no general equity jurisdictionexcept as specifically provided for by law]). Given the record before this Court, however, anaccounting is not needed here to adjudicate this claim since there is no uncertainty as to theamount sought to be recovered from defendant (see generally Pieper v Renke, 4 NY2d 410, 411

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[1958]; 1 NY Jur Accounts & Accounting 34; cl770 Owners Corp. v Spitzer, 2009 NY Slip Op51968U at 6 [Sup Ct, Kings County 2009]). Thus, the Court denies this branch of defendant' smotion.

Next, defendant contends that this claim should be dismissed under the equitable doctrineof unclean hands. Defendant claims that he is accused of "doing just what they did before theyturned over control of the account" in 2008 (Answer at 14-15). "The doctrine of uncleanhands applies when the complaining party shows that the offending party is 'guilty of immoral,unconscionable conduct and even then only when the conduct relied on is directly related to thesubject matter in litigation and the party seeking to invoke the doctrine was injured by suchconduct'" (Kopsidas v Krokos, 294 AD2d 406, 407 [2d Dept 2002], quoting National Distillers& Chern. Corp. v Seyopp Corp., 17 NY2d 12, 15-16 [1966]; see Welch vDi Biasi, 289 AD2d964,965 [4'h Dept 2001]). Here, defendant's conclusory allegations are insufficient to entitlehim to dismissal based on this doctrine (see Clifton County Rd. Assocs. v Vinciguerra, 195 AD2d895, 896 [3d Dept 1993], Iv denied 82 NY2d 664 [1994]). Among other things, defendant hasfailed to show how he was directly injured by any alleged conduct by plaintiff during past changeof leadership and that those actions are related to the instant claim (see Sutter v Lane, 61 AD3d1310,1313 [3d Dept 2009]). Accordingly, this branch of defendant's motion is denied.

As to the sixth and seventh branches of defendant's motion, defendant contends thatplaintiffs treasure and the recipients of the funds sought to be recovered are necessary parties tothis action and, without their joinder, dismissal is warranted. This argument lacks merit."Necessary parties are 'persons who ought to be parties if complete relief is to be accordedbetween the persons who are parties to the action or who might be inequitably affected by a

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judgment in the action'" (Sorbello v Birchez Assocs., LLC, 61 AD3d 1225, 1226 [3d Dept 2009],quoting CPLR 1001 [aD . As to the treasurer, his presence is not necessary for complete relief tobe accorded here. Pursuant to the record before the Court, the checks in question were signed bydefendant and not the treasurer. Further, given the informal and simplified procedures on smallclaims and the available documentary evidence, the treasurer's presence may not be necessary(see Uniform City Court Act 1804). In any event, should testimony from the treasurer benecessary, he does not need to be a party to testify in this action. As to the vendors whopurportedly received the improperly paid contributions, their presence is not necessary to affordrelief as between plaintiff and defendant (see CPLR IDOl). Accordingly, these branches ofdefendant's motion are denied.

Defendant also contends that this action shou ld be dismissed since he acted in accordwith the Election Law disbursing the subject funds to various charities, relying on Election Law 14-130. While this section may allow charitable donations, the question at issue here is whetherdefendant, as committee chair, had the authority to make such donations for the Committee underthe circumstances presented. Therefore, at this juncture, the Court declines to dismiss thecomplaint based on this affirmative defense (see generally CPLR 3211 [a] [7D.

Finally, in his supplemental submission, defendant contends that this claim should bedismissed since plaintiff lacks standing to institute an action in sma ll claims. The essence of thisargument is that plaintiff is an association and, as such, has no standing pursuant to the UniformCity Court Act article 18 to initiate this claim. In response, plaintiff contends that, even if thisargument has merit, it is to no avail since it would have standing pursuant to article 18-A and theCourt has authority to transfer the claim to that part.

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As defendant maintains, Uniform City Court Act 1809 (1) provides, in relevant part,that "[n]o . . . association . . . shall institute an action or proceeding under this article . . . .Moreover, "a political committee is deemed to be an uncorporated association" (see D 'Angelo vElection Comm. ofKings County Republican Comm., 154 Misc 2d 926, 928 [Sup Ct, KingsCounty 1992]). Thus, here, plaintiff does not appear to have standing to bring a claim underarticle 18 of the Uniform City Court Act (see Uniform City Court Act 1809). However, asplaintiff argues, "[t]he court shall have power to transfer any small claim or claims to any otherpart of the court upon such terms as the rules may provide, and proceed to hear the sameaccording to the usual practice and procedure applicable to other parts of the court" (UniformCity Court Act 1805 [b]) . Thus, here, although plaintiff lacks standing under article 18 , theCourt has the power to transfer the matter to another part of the Court.

Plaint iff contends that the Court should transfer the matter under article 18-A - forcommercial claims. On the other hand, defendant contends that this matter is not "commercial"and, thus, does not fall under the ambit of that article. Pursuant to Uniform City Court Act 1801-A (a) and as reie"vant here, a commercial claim

shall mean and include any cause for action for money only not in excess of themaximum amount permitted for a small claim in the small claims part of thecourt, exclusive of interest and cost . . . the claimant is a[n] . . . association, whichhas its principal office in the state ofNew York and provided that the defendanteither resides, or has an office for the transaction of business or a regularemployment, within the county in which the court is located. . . .

Further, under this definition, "a claim is 'commercial' not based on its subject matter, butmerely because the claimant is a corporation, partnership, or association . . . . The claim itselfapparently need not be 'commercial' in nature, e.g., arise via contract. As long as the claimant isan entity, even a tort claim will presumably fit under Article 18-A" (Siegel, Practice

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Commentaries, McKinney's Cons Laws ofNY, Book 29A, UCCA 1801-A). Given theforegoing, this matter should be transferred to the commercial small claims part of this Court (seeUniform City Court Act 1805 [b]; article 18-A).

Otherwise, the Court has considered the parties' remaining arguments and finds themlacking in merit. Accordingly, it is

ORDERED that defendant's motion to dismiss is denied; and it is furtherORDERED that this claim is transferred the commercial small claims part of this Court;

and it is furtherORDERED that a hearing regarding the merits of this matter will he held as noticed by

the Clerk of the Court.This shall constitute the Decision and Order of the Court. This Decision and Order is

being returned to the attorneys for plaintiff. The signing of this Decision and Order shall notconstitute entry or filing under CPLR 2220. Counsel are not relieved from the applicableprovisions of that rule relating to filing, entry, and notice of entry.

SO ORDERED!ENTER.Dated: Rensselaer, New York

February I 0 ,2009

City Court Judge

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desicion and order 2 10 2010

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