Dispute Over Authority of Employee to Accept Service Creates Dispute Over Sufficiency of Service

On February 3, 2023, Justice Ruchelsman of the Kings County Commercial Division issued a decision in USA Med. LLC v LABQ Clinical Diagnostics, LLC, 2023 NY Slip Op 30388(U), holding that a dispute over the authority of a corporate employee to accept process created a question of fact regarding whether the corporation had been properly served, explaining:

It is well settled that the statutory framework for service of process is to fairly notify the defendant of an impending action and provide the defendant with the mechanisms necessary to adequately respond. Moreover, service of process is also an exercise of the court’s power and authority over litigants and thus, such service of process infuses the litigation with court sanctioned legitimacy. It is for these reasons that simple notice is insufficient to confer jurisdiction over a defendant. Likewise, the failure to abide by any of the necessary requirements for the lawful service of a summons and complaint will result in the failure to confer jurisdiction.

Pursuant to CPLR §311-a service upon a Company such as the defendant in this case can only be made to any other person designated by the limited liability company to receive process, in the manner provided by law for service of a summons as if such
person was a defendant. Generally a process server’s affidavit provides prima facie evidence of proper service. To contend that service was improper and that defendant is entitled to a hearing on the matter, the defendant must allege facts to support the contention.

The affidavit of the process server, Felix Vasquez, states that on September 1, 2022, at the defendant’s offices a woman presented herself and stated that she was authorized to accept service but that she refused to accept such service. Whereupon
Mr. Vasquez left the summons with this authorized individual and announced service. In a further affidavit dated January 20, 2023, Mr. Vasquez elaborates that he entered the defendant’s offices, was greeted by a woman and informed her that he had legal papers to serve. That individual summoned a manager who stated she was authorized to accept service but that she would not accept such service. Mr. Vasquez stated that he left the summons and complaint and departed.

In opposition to the affidavits of Mr. Vasquez the defendant has introduced the affidavit of Tamar Cruz the receptionist at defendant’s office. She states that indeed she met Mr. Vasquez and informed him that she was not authorized to accept service but would call the office manager who could accept service. She further states that Mr, Vasquez informed her that he was too busy and left the summons and complaint there and departed.

The plaintiff argues that the affidavit of Ms. Cruz does not conflict with the affidavits of Mr. Vasquez and that there is no basis to conduct a hearing regarding service. Specifically, the plaintiff argues that Ms. Cruz did verify that such a manager was present at LabQ on September 1, 2022 who was authorized to accept service, and that Ms. Cruz identified and sought that individual to come meet a process server. First, Ms. Cruz specifically named the manager as Solomon Brown, while Mr. Vasquez stated the manager was a female. More importantly, Ms. Cruz never stated the manager was ever summoned to meet Mr. Vasquez. On the contrary, she specifically stated that Mr. Vasquez never had any conversation with any manager at all. Thus, there are clear contradictory versions of whether any proper service was ever effectuated.

Further, there are surely questions whether Ms. Cruz was authorized to accept service. Ms. Cruz states that she informed Mr. Vasquez that she was not authorized to accept service. Mr. Vasquez did not dispute that per se but did admit the first individual he encountered went to summon a manager strongly implying she herself maintained no such authority. Consequently, there are surely questions of fact whether Mr. Vasquez reasonably believed Ms. Cruz was authorized to accept service. In truth, the argument whether Mr. Vasquez reasonably believed Ms. Cruz was authorized to accept service contradicts the argument the summons was left with a manager. To the extent these arguments are presented in the alternative, questions of fact are surely presented.

Further, there are really no questions of fact whether Ms. Cruz resisted service of process. An individual not authorized to accept service does not thereby resist service by refusing to accept what the individual cannot accept. Again, this argument conflates MS. Cruz with a manager. According to Mr. Vasquez he met two individuals that day, the first one, arguably Ms. Cruz, presented sufficient evidence that she was not authorized to accept service.

Therefore, there are questions of fact whether service of process was properly effectuated. Consequently, the parties will be notified about a hearing on the issue of service. The request to vacate the default must await the outcome of that hearing.

(Internal quotations and citations omitted).

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