Summary Judgment pushed by debt collectors

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CPLR § 3212(b) requires that a motion for summary judgment be supported by an affidavit of a person with requisite knowledge of the facts, together with a copy of the pleadings and by other available proof ( Spearmon v Times Square Stores Corp., 96 AD2d 552, 553 [2d Dept 1981])

The movant must tender evidence, by proof in admissible form, to establish the cause of action "sufficiently to warrant the court as a matter of law in directing judgment" ( see CPLR 3212[ b ]; Zuckerman v City of New York, 49 NY2d 557, 562 [1980]).

"Failure to make such showing requires the denial of the motion, regardless of the sufficiency of the opposing papers." ( Winegrad v New York Univ Med. Ctr., 64 NY2d 851, 853 [1985]; Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986] Vitiello v Mayrich Constr. Corp., 255 AD2d 182, 184 [1st Dept 1998]).

A conclusory affidavit, or an affidavit by a person who has no personal knowledge of the facts, cannot establish a prima facie case. ( JMD Holding Corp. v Cong. Fin. Corp., 4 NY3d 373, 385 [2005]; Castro v NY Univ., 5 AD3d 135, 136 [1st Dept 2004]) A mere conclusory assertion of a fact, without any evidentiary basis, is insufficient. (Grullon v City of New York , 297 AD2d 261, 263 [1st Dept 2002]).

When the affiant relies on documents, the documents relied upon must be annexed (Vermette v Kenworth Truck Co., Div. of Paccar, Inc., 68 NY2d 714, 717 [1986]; Afco Credit Corp. v Mohr , 156 AD2d 287, 288 [1st Dept 1989]), and the affiant must establish an adequate evidentiary basis for them.

Mere submission of documents without any identification or authentication is inadequate. (Higen Assocs. v Serge Elevator Co. , 190 AD2d 712, 713 [2d Dept 1993]).

When the movant seeks to have the Court consider a business record, the proponent must establish that it meets the evidentiary requirements for a business record, by, [*2]for example, having a corporate officer swear to the authenticity and genuineness of the document.

(CPLR 4518[a]; First Interstate Credit Alliance, Inc. v Sokol, 179 AD2d 583, 584 [1st Dept 1992]; Bowers v Merchants Mut. Ins. Co. , 248 AD2d 1005, 1006 [4th Dept 1998]; A.B. Med. Servs., PLLC v Travelers Prop. Cas. Corp., 5 Misc 3d 214 [Civ Ct, Kings County 2004]).

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A Motion for Summary Order shall be granted if, upon review of all the papers and proof submitted, it is concluded the cause of action or a defense thereto is established as a matter of law CPLR 3212(b)].

Granting Summary Order does not deny the Respondent his right to a hearing where the record demonstrates there is no triable issue of fact relevant to the outcome of the case. In such a case, the determination through this means fulfills the requirement that a party be given an opportunity for a hearing [Crowley's Milk Co. v. Klein, 24 AD2d, (3d Dept 1965)].

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Atorneys’ conclusory statement is without personal
knowledge (see Capelin Assocs. v Globe Mfg. Corp., 34 NY2d 338,
342 [1974]), and therefore is of no probative value in opposing the
motion (see Spearmon v Times Square Stores Corp.,
96 AD2d 552 [1983]).

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To the same effect is Rushmore Recoveries X, LLC v. Skolnick, 21161/05, 2007
NY Slip Op 51041U; 2007 N.Y. Misc. LEXIS 3731 (Nassau Co. Dist. Ct., May
24, 2007):

The Plaintiff attempts to support its motion with the affidavit of Todd
Fabacher, who identifies himself as "an authorized and designated
custodian of records for the plaintiff regarding the present matter."
(Fabacher Affidavit 3/14/07, P 1) Mr. Fabacher describes his duties as
including "the obtaining, maintaining and retaining, all in the regular
course of plaintiff's business, including obtaining records and
documents from or through CITIBANK or [*2] any assignee or
transferee previous to plaintiff, any and all records [**3] and
documentation regarding the present debt." (Fabacher Affidavit
3/14/07, P 1) While Mr. Fabacher attempts to portray himself as one
who is "personally familiar with, and hav[ing] knowledge of, the facts
and proceedings relating to the within action" (Fabacher Affidavit
3/14/07, P 1), it is readily apparent from a reading of his affidavit that
his claimed personal familiarity with this matter is taken from the
documents and records ostensibly created by Citibank, and/or
assignees who have preceded the Plaintiff, which have now come into
the Plaintiff's possession. Clearly, Mr. Fabacher has no personal
knowledge of the retail charge account agreement between the
Defendant and Citibank. . . .
The Plaintiff's reliance upon the documents it submits is insufficient
to make out a prima facie case entitling the Plaintiff to summary
judgment. Simply annexing documents to the moving papers, without
a proper evidentiary foundation [**4] is inadequate. . . .


The documents the Plaintiff attempts to submit, specifically the
purported account statements and assignments, are being offered for
the truth of the statements contained therein and are, by definition,
hearsay. . . . They may be considered only if they fall within one of
the recognized exceptions to the hearsay rule. . . .The Plaintiff
attempts to rely upon the business records exception to the hearsay
rule in its effort to establish a prima facie case.
. . . the proponent of the offered evidence must establish three general
elements, by someone familiar with the habits and customary
practices and procedures for the making of the documents, before
they will be accepted in admissible form: (1) that the documents were
made in the regular course of business; (2) that it was the regular
course of the subject business to make the documents; and, (3) that
the documents were made contemporaneous with, or within a
reasonable time after, the act, transaction, occurrence or event
recorded. . . .
The repetitive statements of Mr. Fabacher, the Plaintiff's custodian of
records, to the effect that he collects and maintains the records and
documents of Citibank and/or any other prior assignees, "in the
regular course of plaintiff's business" (Fabacher Affidavit 3/14/07, P
1), as if they were magic words, does not satisfy the business records
exception to the hearsay rule. That phrase, standing alone, does not
establish that the records upon which the Plaintiff relies were made in
the regular course of the Plaintiff's business, that it was part of the
regular course of the Plaintiff's business to make such records, or that
the records were made at or about the time of the transactions
recorded. Contrary to the misconception under which the Plaintiff
labors, "the mere filing of papers received from other entities, even if
they are retained in the regular course of business, is insufficient
[**8] to qualify the documents as business records (citation omitted)."
Standard Textile Co., Inc. v. National Equipment Rental, Ltd., 80
A.D.2d 911, 437 N.Y.S.2d 398 (2nd Dept. 1981); see also: Romanian
American Interests, Inc. v. Scher, 94 A.D.2d 549, 464 N.Y.S.2d 821 (2nd
Dept. 1983); Lodato v. Greyhawk North America, LLC, 39 AD3d 494,
___ , 2007 WL 1017759 (2nd Dept. 2007) The statements of Mr.
Fabacher, "who merely obtained the records from another entity that
actually generated them, was an insufficient foundation for their
introduction into evidence [citing Standard Textile Co., Inc. v. National
Equipment Rental, Ltd., supra.]." Insurance Company of North
America v. Gottlieb, 186 A.D.2d 470, 588 N.Y.S.2d 571 (1st Dept.
1992)

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The Court also required production of the actual assignment of the particular
debt:

The above notwithstanding, the documents upon which the Plaintiff
relies do not support the Plaintiff's claim. While the Plaintiff alleges
that it is the assignee of this account, the Plaintiff fails to provide
proper proof of the alleged assignment sufficient to establish its
standing herein. The Plaintiff has made no effort to authenticate the
alleged assignments, NYCTL 1998-2 Trust v. Santiago, 30 AD3d 572,
817 N.Y.S.2d 368 (2nd Dept. 2006); [**9] and, there is a break in the
chain of the assignments from Citibank down to the Plaintiff. The
purported assignment from NCOP Capital, Inc. to New Century
Financial Services, Inc., Plaintiff's alleged assignor, is not signed at all
on behalf of NCOP Capital, Inc. There being no competent proof that
the assignment to New Century Financial Services, Inc. was valid, the
Plaintiff cannot establish the validity of the assignment from New
Century Financial Services, Inc. to the Plaintiff, preventing [*4] the
granting of summary judgment for this reason as well. . . .

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Finally, “The Plaintiff has also failed to submit any competent proof of an
agreement between Citibank and the Defendant.”
The Plaintiff's reliance on Chase Manhattan Bank (National
Association), Bank Americard Division v. Hobbs, 94 Misc 2d 780, 405
N.Y.S.2d 967 (Civ. Ct. Kings Co. 1978) is misplaced. The plaintiff
therein was not an assignee, but the party with which the defendant
had entered into a retail charge account agreement and could
properly lay a business record foundation for [**10] the entry of the
documents necessary to prove the existence of same. Additionally, the
plaintiff therein provided proper proof of mailing of the subject
account statements, along with copies of the retail charge account
agreement, and demonstrated the defendant's use of the credit card in
question, thereby accepting the terms of use of that card.
In the matter sub judice, the account statements upon which the
Plaintiff relies do not show any usage of the credit card in question by
the Defendant. The four (4) statements submitted show only an
alleged open balance, with the accrual of fees and finance charges
thereon. The Plaintiff also fails to submit any proof that a copy of the
retail installment credit agreement or the statements upon which it
relies were ever mailed to the Defendant. Neither Mr. Fabacher nor
Plaintiff's counsel mailed these documents or have personal
knowledge of their mailing; nor does the Plaintiff even attempt to
describe a regular office practice and procedure for the mailing of the
documents designed to insure that they are always properly addressed
and mailed. . . .

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Another New York court was presented with similar documentation in the context
of a motion to confirm an arbitration award, in MBNA America Bank, N.A. v.
Nelson, 13777/06, 2007 NY Slip Op 51200U; 2007 N.Y. Misc. LEXIS 4317
(N.Y.Civ. Ct. May 24, 2007). The court first required proof that the plaintiff was
the owner of the particular debt:
It is imperative that an assignee establish its standing before a court,
since "lack of standing renders the litigation a nullity." 20 It is the
"assignee's burden to prove the assignment" and "an assignee must
tender proof of assignment of a particular account or, if there were an
oral assignment, evidence of consideration paid and delivery of the
assignment." 21 Such assignment must clearly establish that
Respondent's account was included in the assignment. A general
assignment of accounts will not satisfy this standard and the full chain
of valid assignments must be provided, beginning with the assignor
where the debt originated and concluding with the Petitioner. . . .
20 Citibank (South Dakota), N.A. v. Martin , 11 Misc 3d 219,
226, 807 N.Y.S.2d 284 [Civ. Ct. New York County 2005].
21 Id at 227 (collecting cases) (internal citations omitted)
(emphasis added).
Because multiple creditors may make collection efforts for the same
underlying debt even after [*6] assignment, for any variety of
reasons (i.e. mis-communication or clerical error) failure to give
notice of an assignment may result in the debtor having to pay the
same debt more than once or ignoring a notice because the debtor
believes he or she has previously settled the claim. Further, debtors
are often left befuddled as they get the run-around from a panoply of
potential creditors when inquiring about their defaulted accounts,
[**16] during which time they lose the ability to negotiate payments
with the current debt owner (whoever that may be at the time) and
therefore incur additional fees and penalties. Courts in other states,
reviewing general principles of assignment, have noted that notice to
the debtor is an explicit requirement to a valid assignment. . . .

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Next, the court required proof of the actual terms of the agreement with the
particular debtor (*7-9)
. . . The notion that the terms of a valid offer be communicated to the
offeree, regardless of whether the contract is unilateral, bilateral or
otherwise, before they can become binding is well settled law. 32
Therefore, absent a definite and certain offer outlining the terms and
conditions of credit card use with the user's actual signature, the
Petitioner . . . has the burden of establishing the binding nature of the
underlying contract, including any allegedly applicable arbitration
clauses, which entails proof, at a most basic level, that the debtor was
provided with notice of the terms and conditions 33 to which Petitioner
now [*8] seeks to hold [**23] Respondent. 34
Petitioner must tender the actual provisions agreed to, including any
and all amendments 35, and not simply a photocopy of general terms
to which the credit issuer may currently demand debtors agree. For
example, Petitioner's Exhibit A which is labeled "Credit Card
Agreement and Additional Terms and Conditions" lacks
Respondent's signature. Neither does it contain a date indicating
when these terms were adopted by MBNA nor how the terms were
amended or changed, if at all, over the years appear anywhere on the
document. Furthermore, the contract does not contain any name,
account number or other identifying statements which would connect
the proffered agreement with the Respondent in this action. In fact,
petitioners [**25] appear to have attached the exact same photocopy,
which as noted is not specific to any particular consumer, to many of
its confirmation petitions. While on its face there is nothing
necessarily unusual about a large commercial entity such as MBNA
providing a standard form contract that all credit card consumers
agree to, the burden nevertheless remains with MBNA to tie the
binding nature of its boiler-plate terms to the user at issue in each
particular case and to show that those terms are binding on each
Respondent it seeks to hold accountable 36 (the Respondent's intent to
be bound after notice of terms is established can be shown via card use
37). 38 The fact that MBNA issues a particular agreement with
particular terms with the majority of its customers is of little
relevance in determining the actual terms of the alleged agreement
before this Court, if not linked directly to respondent in some way
shape or form. Just because a petitioner provides a photocopy of a
document entitled "Additional Terms and Conditions," certainly does
not mean those terms are binding on someone who could have
theoretically signed a completely different agreement when they were
extended credit. Whether [**26] the physical card itself or some
solicitation agreement with Respondent's signature referenced the
terms and conditions 39, or whether the terms were made readily
accessible to Respondent by e-mail or the internet, and Respondent
was in fact aware of this, may all be relevant to an inquiry into
constructive notice but such notice must still be established. At bar,
MBNA Bank has failed to establish that the provided terms and
conditions were the actual terms and conditions agreed to by Nelson.
As such, applying Kaplan, the Court does not find objective intent on
the part of the Respondent to be bound to the contractual statements
proffered by MBNA requiring the question of arbitrability to be
decided by the arbitrator or that arbitration is the required forum for
either party to bring claims against the other.

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State law often outlines the acceptable procedures for
amendments to retail credit agreements, and courts may treat
as a nullity any amendment that did not follow proper [*17]
notification, opt out or other relevant amendment procedures
(see for e.g. Kurz v. Chase Manhattan Bank USA, N.A., 319 F.
Supp. 2d 457, 465 [2d Cir. 2004]) (under Delaware law "a credit
card issuer seeking [**27] unilaterally to add an arbitration
clause to the agreement must provide notice and an opt out
provision"). However, in order to make such a determination
the evolution of the contractual agreement from birth to
litigation must be outlined for the court's scrutiny. Without the
original agreement provided and its history made available,
the court is effectively impinged from exercising its limited
review function.
While these deficiencies of proof are fatal to Petitioner's claim, such a
problem is not without a solution. Since the credit card issuer is the
party in the best position to maintain records of notification it may
provide an affidavit from someone with knowledge of the policies,
procedures and practices of its organization affirming (1) when and
how the notification of the original terms and conditions was provided
40, including any solicitations or applications containing the
Respondent's signature, (2) what those terms and conditions were at
the time of the notification, (3) whether the mandatory arbitration
clause, and any [**29] other additional provisions Petitioner now
treats as binding, were included in the terms and conditions of card
use at the time Respondent entered into the retail credit agreement,
and if they were not, then when they were added, as well as a
statement certifying that (a) such addition was made pursuant to the
applicable [*9] law chosen by the parties to apply to the agreement,
not limited to but especially including mandatory opt-out
requirements, and (b) a statement indicating that upon reasonable
and diligent inspection of the records maintained by the Petitioner,
and to the best of Petitioners' knowledge Respondent never opted out
of said clause, and the basis for this determination. The use of such
affidavits to support confirmation of arbitration awards is not novel.