Dumolo v. Dumolo et al
Filing
13
ORDER denying 12 Motion for Default Judgment. For the foregoing reasons, plaintiff's motion for default judgment is DENIED without prejudice to renew. Plaintiff is directed to serve a copy of this order on defendants, and file proof of servi ce on the docket by April 1, 2019. Plaintiff may file a renewed motion for entry of a default judgment, with adequate supporting evidence regarding the tolling agreement, and on notice to defendants, no later than April 15, 2019. Ordered by Judge Kiyo A. Matsumoto on 3/26/2019. (Mazzurco, Vincent)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
-------------------------------------X
ANTHONY R. DUMOLO,
MEMORANDUM AND ORDER
Plaintiff,
17-CV-7294(KAM)(CLP)
-againstGREGORIO D. DUMOLO and DONNA M DUMOLO,
Defendants.
-------------------------------------X
MATSUMOTO, United States District Judge:
On December 14, 2017, Anthony Dumolo, (“plaintiff” or
“Anthony”) commenced the instant action by filing a complaint
against Gregorio Dumolo and Donna Dumolo, his brother and
sister.
(See ECF No. 1, Compl.)
This family dispute centers
around an agreement made between siblings and their ailing
mother to distribute her estate in equal shares to her three
children after their mother’s death.
At the heart of the
agreement (the “Family Agreement” or “Agreement”), and this
dispute, is a residence in Wantagh, New York at 930 Park Drive
(the “Premises”).
After filing the complaint, plaintiff effected service
on defendants in January 2018. 1
(ECF Nos. 7, 8.)
In April 2018,
after neither defendant appeared, answered, or otherwise moved,
A review of the filed executed summonses in this case indicates both
defendants were properly served, Gregorio under N.Y. C.P.L.R. § 313 by
service “without the state,” and Donna under N.Y. C.P.L.R. § 308 through
“nail-and-mail” substitute service. (See ECF No. 12-6.)
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plaintiff requested a certificate of default as to both
defendants pursuant to Federal Rule of Civil Procedure 55 (“Rule
55”).
(ECF No. 10.)
The Clerk of Court entered a default
against both defendants, (ECF No. 11), and plaintiff now moves
this court for an entry of default judgment and an award of
damages, (ECF No. 12).
I.
Fact Summary
BACKGROUND
Based on the allegations of the complaint, to which
the defaulting defendants have not responded, Plaintiff, Anthony
Dumolo, and defendants, Gregorio and Donna Dumolo, are siblings.
(ECF No. 1-2, Compl., Ex. 2, Dumolo Decl. at 1.)
Their mother,
Marie Dumolo (“Marie”), owned their family home, the Premises
located at 930 Park Drive, Wantagh, New York.
Marie passed away on January 5, 2004.
(Id.)
(Id.)
Approximately four months prior to her death, on or about August
18, 2003, Marie and her children entered into a Family
Agreement.
(See Dumolo Decl., Ex. 1, Executed Family Agreement
(“Fam. Agmt.”).)
Marie was in such poor health at the signing
that she marked “X” in lieu of her signature.
(Id. at 4-7.)
The Family Agreement concerned the distribution and
division of Marie’s assets, including the Premises, amongst her
three children and expressed her desire that the siblings
inherit equally from her estate.
(Id. at 1.)
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The Agreement
specified that title to the Premises would be transferred to
Gregorio.
(Id. at 2.)
Mother and siblings agreed that New York
law would govern the Agreement.
(Id. at 3.)
The Agreement thus
outlined a plan to value and divide Marie’s assets among her
children upon her death.
(Id. at 2.)
For the purposes of
valuing her estate, the Premises would be valued at its fair
market value at the time of Marie’s death. 2
(Id.)
The siblings
agreed to furnish to each other the necessary documents to
support the value of “any and all assets” of their mother’s
estate and any property under the Agreement.
(Id.)
Gregorio
further agreed to maintain all records related to any
disbursements and expenditures made in maintaining the Premises;
any such expenditures would, in turn, reduce the value of the
property.
(Id.)
Within twelve months of the date of Marie’s
death, Gregorio agreed to do one of the following:
(A)
(B)
(C)
(D)
Sell the [Premises] and transfer to ANTHONY and
DONNA each a one–third (1/3) share of the net
proceeds, or
Pay over to ANTHONY and DONNA each a sum
representing a one-third (1/3) share of the fair
market value of the [Premises], or
Convey to ANTHONY and DONNA each an undivided
one-third (1/3) interest in the [Premises], or
Execute a mortgage in favor of each of ANTHONY
and DONNA in an amount equivalent to one-third
(1/3) of the fair market value of the [Premises].
(Id. at 2-3.)
The Agreement approximated the value of the Premises to be $350,000 at
the time of signing. (Fam. Agmt. at 1.)
2
3
In December 2003, Gregorio asked of Anthony that the
twelve-month period following their mother’s death, specified in
the Family Agreement and within which Gregorio agreed to sell
the Premises, be tolled until after he retired.
at 4.)
Plaintiff agreed to this tolling.
(Dumolo Decl.
(Id.)
Gregorio retired in 2012, and sometime after, Anthony
unsuccessfully attempted to contact Gregorio by telephone.
at 5.)
(Id.
Anthony was then unaware of Gregorio’s exact
whereabouts, as he had moved from the Premises.
(Id.)
Through
counsel, plaintiff ascertained Gregorio’s whereabouts and wrote
to him on July 27, 2016.
(Id.)
He informed Gregorio that he
was in breach of the Agreement and had deprived Anthony of his
one-third share of the inheritance.
July 27, 2016 Letter.)
(See Dumolo Decl., Ex. 3,
The letter expressed Anthony’s desire to
resolve the dispute amicably and proposed Gregorio comply with
the terms of the Agreement within 30 days and to distribute the
inheritance to the siblings within 60 days.
(Id.)
On August 21, 2016, Gregorio replied to plaintiff’s
correspondence.
(Dumolo Decl., Ex. 4, Aug. 21, 2016 Letter.)
Gregorio defended his actions but nevertheless apologized that
he “fell short” in his obligation by failing to sell the house.
(Id.)
He represented that he would put the house up for sale by
May 1, 2017, noting that this would provide time to “fix-up” the
house, and for Donna to move out.
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(Id.)
Plaintiff’s counsel replied on September 21, 2016, to
Gregorio.
(Dumolo Decl., Ex. 5, Sept. 21, 2016 Letter.)
Plaintiff rejected Gregorio’s proposed timeline, and counterproposed proceeding with option B from the Agreement, payment by
Gregorio to his siblings of a one-third share each of the fair
market value of the Premises.
(Id.)
Plaintiff did not receive
a response to his September 21, 2016 letter, or to a December 5,
2016 letter from plaintiff’s counsel to Gregorio.
(Dumolo Decl.
at 8; see also Dumolo Decl., Ex. 6.)
Plaintiff alleges that Gregorio and Donna failed to
fulfill their obligations under the Family Agreement, and that
Gregorio failed to fulfill his promise to sell the Premises
after his retirement in 2012 or to put the Premises on the
market by May 1, 2017.
(Dumolo Decl. at 9.)
plaintiff was denied his inheritance.
(Id.)
As a result,
Plaintiff alleges
that “the damages, opportunity costs, and inequitable conduct
sustained by my family and me, as a direct result of egregious
selfishness and misconduct by Defendants are well over
$250,000.”
(Id.)
In support of this figure, plaintiff provides
a New York State Multiple Listing Service (“MLS”) listing, that
values the home at $475,850 using something called the Automated
Valuation Model. 3
(Dumolo Decl., Ex. 7, MLS Listing.)
The Automated Valuation Model refers to a service that uses
mathematical modeling combined with databases of existing properties and
transactions to calculate real estate values. Will Kenton, Automated
3
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LEGAL STANDARD
II.
Default Judgment
Pursuant to Rule 55, courts follow a two-step process
to enter default judgment.
City of New York v. Mickalis Pawn
Shop, LLC, 645 F.3d 114, 128 (2d Cir. 2011).
First, the Clerk
of Court must enter a default when “a party against whom a
judgment for affirmative relief is sought has failed to plead or
otherwise defend, and that failure is shown by affidavit or
otherwise.”
Fed. R. Civ. P. 55(a).
A court considers an entry
of default against a party to be an admission of all the wellpleaded allegations in the complaint regarding liability.
Cement & Concrete Workers Dist. Council Welfare Fund v. Metro
Found. Contractors Inc., 699 F.3d 230, 234 (2d Cir. 2012); see
also Vt. Teddy Bear Co. v. 1-800 Beargram Co., 373 F. 3d 241,
246 (2d Cir. 2004) (“[Rule 55] tracks the ancient common law
axiom that a default is an admission of all well-pleaded
allegations against the defaulting party.”).
Second, if the
defaulting party fails to appear or move to set aside the entry
of default under Rule 55(c), the opposing party may file a
motion for default judgment to establish liability and damages.
See Fed. R. Civ. P. 55(b)(2).
Valuation Model – AVM, Investopedia (Mar. 29, 2018),
https://www.investopedia.com/terms/a/automated-valuation-model.asp.
used widely by appraisers and other institutions. Id.
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It is
A. Liability
However, an entry of default does not necessarily
entitle a moving party to default judgment “as a matter of
right.”
GuideOne Specialty Mut. Ins. Co. v. Rock Cmty. Church,
Inc., 696 F. Supp. 2d 203, 208 (E.D.N.Y. 2010).
The court must
determine whether the plaintiff’s allegations establish
“liability as a matter of law,” thus warranting default
judgment.
Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009);
see also Au Bon Pain Corp. v. Artect, Inc., 653 F.2d 61, 65 (2d
Cir. 1981) (“[A] district court has discretion under Rule
55(b)(2) once a default is determined to require proof of
necessary facts and need not agree that the alleged facts
constitute a valid cause of action . . . .”).
In light of the
Second Circuit’s “oft-stated preference for resolving disputes
on the merits,” default judgments are “generally disfavored.”
Enron Oil Corp. v. Diakuhara, 10 F.3d 90, 95-96 (2d Cir. 1993).
Thus, courts grant a motion for default judgment only if the
plaintiff has satisfied its burden of demonstrating that the
unchallenged allegations, and all reasonable inferences drawn
from the evidence, establish the defendant’s liability on each
asserted cause of action.
“Put differently, liability does not
automatically attach from the well-pleaded allegations of the
complaint, as it remains the court’s responsibility to ensure
that the factual allegations, accepted as true, provide a proper
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basis for liability and relief.”
Rolls-Royce PLC v. Rolls-Royce
USA, Inc., 688 F. Supp. 2d 150, 153 (E.D.N.Y. 2010).
B. Damages
“While a default judgment constitutes an admission of
liability, the quantum of damages remains to be established by
proof unless the amount is liquidated or susceptible of
mathematical computation.”
Flaks v. Koegel, 504 F.2d 702, 707
(2d Cir. 1974).
Once the court finds a defaulting party liable, it
next considers whether the movant “has met the burden of proving
damages to the court with ‘reasonable certainty.’”
J & J Sports Prods., Inc. v. LX Food Grocery Inc., No. 15-CV6505, 2016 WL 6905946, at *2 (E.D.N.Y. Nov. 23, 2016) (quoting
Credit Lyonnais Sec. (USA), Inc. v. Alcantara, 183 F.3d 151, 155
(2d Cir. 1999)).
An evidentiary hearing is not required to
determine damages so long as there is a basis for the awarded
damages specified in the default judgment.
Transatlantic Marine
Claims Agency, Inc. v. Ace Shipping Corp., Div. of Ace Young
Inc., 109 F.3d 105, 111 (2d Cir. 1997) (quoting Fustok v.
ContiCommodity Servs., Inc., 873 F.2d 38, 40 (2d Cir. 1989)).
“[A] review of detailed affidavits and documentary evidence” is
sufficient to form a basis for calculating reasonably certain
damages.
Cement & Concrete Workers, 699 F.3d at 234; Circuito
Cerrado, Inc. v. Pizzeria y Pupuseria Santa Rosita, Inc., 804 F.
8
Supp. 2d 108, 114 (E.D.N.Y. 2011) (“In determining damages not
susceptible to simple mathematical calculations, Federal Rule
55(b)(2) gives courts discretion to determine whether an
evidentiary hearing is necessary or whether detailed affidavits
or documentary evidence are sufficient.”).
DISCUSSION
I.
Personal Jurisdiction
Plaintiff alleges that he is a citizen and resident of
Connecticut and that defendant Donna Dumolo is domiciled in and
a citizen of New York.
(Compl. ¶¶ 2, 4.)
Thus, there is
diversity jurisdiction between plaintiff and Donna Dumolo.
Though plaintiff alleges that Gregorio is a dual-citizen of New
York and Pennsylvania, he does not offer facts sufficient to
establish his residence in New York, thus supporting this
court’s diversity jurisdiction over Gregorio.
The court must
therefore satisfy itself that it has subject matter and personal
jurisdiction before rendering judgment against defendants.
See
Covington Indus., Inc. v. Resintex A.G., 629 F.2d 730, 732 (2d
Cir. 1980) (“A judgment entered against parties not subject to
the personal jurisdiction of the rendering court is a
nullity.”).
Under New York’s long-arm statute, the court may
establish personal jurisdiction over non-domiciled individuals,
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such as Gregorio, where he has transacted business in the state,
personally or through an agent, and when the claim asserted
arises from that activity.
N.Y. C.P.L.R. § 302.
Proof of one
transaction, or a single act, is sufficient to invoke long-arm
jurisdiction in New York.
Best Van Lines, Inc. v. Walker, 490
F.3d 239, 248 (2d Cir. 2007).
Here, Gregorio duly signed the
Family Agreement in Nassau County, New York on August 18, 2003.
(Fam. Agmt. at 4.)
Because this dispute arises from the alleged
failure by Gregorio to perform the duties regarding the Premises
located in New York, as specified in the Family Agreement, the
court finds that Gregorio is subject to its jurisdiction.
II.
Limitations Period
The limitations period for contract disputes governed
by New York state law is six years.
N.Y. C.P.L.R. § 213(2).
Plaintiff avers that he agreed to toll the twelve-month period
within which Gregorio was required to satisfy his obligations
under the Agreement.
(Dumolo Decl. at 4.)
According to
plaintiff, the period was tolled by this subsequent agreement
until Gregorio retired from the U.S. Postal Service, which he
did in 2012.
(Id.)
Indeed, Gregorio references this tolling
agreement in his August 21, 2016 letter.
Letter.)
(See Aug. 21, 2016
However, the court must nevertheless determine whether
this subsequent agreement was a valid modification of the
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contract under New York State law.
If the modification was not
valid, then the breach of contract occurred, and plaintiff’s
cause of action accrued, twelve months from the date of Marie’s
death, or January 5, 2005.
As such, the six-year limitations
period would have expired on January 5, 2011, and plaintiff’s
complaint, filed December 14, 2017, would be untimely.
Under New York law, a contract cannot be modified or
altered without the consent of all the parties thereto.
Becker
v. Faber, 280 N.Y. 146, 149 (N.Y. 1939), reh’g denied, 280 N.Y.
730 (N.Y. 1939).
In the absence of mutual assent to a proposed
modification, the original terms of the contract control.
Beacon Terminal Corp. v. Chemprene, Inc., 429 N.Y.S.2d 715, 71718 (N.Y. App. Div. 1980).
A contractual modification may be demonstrated by the
parties’ respective course of conduct indicating assent.
See
Chase v. Skoy, 536 N.Y.S.2d 512, 513–14 (N.Y. App. Div. 1989);
see also Recon Car Corp. of N.Y. v. Chrysler Corp., 515 N.Y.S.2d
829, 833 (N.Y. App. Div. 1987).
To be valid, a modification
must satisfy each element of a contract, including offer,
acceptance, and consideration.
O'Grady v. BlueCrest Capital
Mgmt. LLP, 111 F. Supp. 3d 494, 502 (S.D.N.Y. 2015) (citing
Beacon Terminal, 429 N.Y.S.2d at 718).
The parties’ course of
conduct constituting modification must nevertheless evince a
meeting of the minds.
Id.
Parties may also orally modify
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written contracts that do not expressly prohibit such oral
modifications.
Maricultura Del Norte v. World Bus. Capital,
Inc., 159 F. Supp. 3d 368, 377 (S.D.N.Y. 2015) (citing Healy v.
Williams, 818 N.Y.S.2d 121, 123 (N.Y. App. Div. 2006)).
However, some performance is necessary to confirm the oral
modification, and it must be “unequivocally referable to the
oral modification.”
Towers Charter & Marine Corp. v. Cadillac
Ins. Co., 894 F.2d 516, 522 (2d Cir. 1990) (quoting Rose v. Spa
Realty Assocs., 42 N.Y.2d 338, 343 (N.Y. 1977)).
Here, the alleged tolling agreement constitutes a
modification to enlarge the time for Gregorio’s performance.
Without evidence of a contemporaneous writing, the court treats
this alleged modification as an oral modification.
As such,
some proof of consideration is required for the modification to
be valid.
Cf. Deutsche Bank Sec., Inc. v. Rhodes, 578 F. Supp.
2d 652, 660 (S.D.N.Y. 2008) (“Modifications to a contract,
however, need not be supported by additional consideration when
the modification is in writing and signed by the party against
whom it is sought to be enforced.”); see also N.Y. Gen. Oblig.
Law § 5–1103 (McKinney 2019).
Gregorio’s alleged agreement to
share equally from the fair market value of the Premises,
instead of reducing the value by his disbursements, constitutes
the relinquishment of a right and is sufficient consideration.
See Jemzura v. Jemzura, 36 N.Y.2d 496, 496 (N.Y. 1975).
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Although plaintiff indicates in his submissions that
he and Gregorio agreed to this tolling, the record contains no
affirmative allegations whatsoever concerning defendant Donna’s
assent to this tolling modification.
Though a course of conduct
may indicate assent, it must unequivocally be directed at the
modification.
Donna’s alleged continuing residence in the
Premises, as stated in Gregorio’s letter, could indicate her
desire not to leave, and coupled with the additional time she
was granted to “get it together and move out,” could
unequivocally constitute some performance indicating her mutual
assent to the terms of the tolling modification.
Plaintiff,
however, has not provided sufficient and unequivocal facts that
all parties agreed to the modification to the Family Agreement.
As such, the court finds that, based on the record
before it, the tolling agreement does not appear to be valid.
Plaintiff’s cause of action therefore accrued on January 5,
2005, one year after his mother’s death, and in the absence of a
valid tolling agreement, the limitations period expired six
years later, on January 5, 2011.
Thus, plaintiff’s breach of
contract claim appears to be untimely.
CONCLUSION
For the foregoing reasons, plaintiff’s motion for
default judgment, based on his breach of contract claim, is
DENIED without prejudice to renew.
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Plaintiff is directed to
serve a copy of this order on defendants, and file proof of
service on the docket, within one week from the date of this
order.
Plaintiff may file a renewed motion for entry of a
default judgment, with adequate supporting evidence regarding
the tolling agreement, and on notice to the defendants, no later
than April 15, 2019.
SO ORDERED.
Dated: Brooklyn, New York
March 26, 2019
________ /s/____________
KIYO A. MATSUMOTO
United States District Judge
Eastern District of New York
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