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Defendant Estopped From Vacating Default on Jurisdictional Grounds

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  • Posted on: Aug 22 2022

By: Jeffrey M. Haber

It is common to include a notice provision in commercial contracts and instruments, such as a loan, promissory note or guaranty. Notice provisions identify the party to whom written notice is to be given and specify the required method and means for delivery of written notice under the contract or instrument. Sometimes, the provision will require the parties to update the provision to account for changes to his or her contact information. As shown in Hudson Val. Bank, N.A. v. Eagle Trading, 2022 N.Y. Slip Op. 04956 (2d Dept. Aug. 17, 2022) (here), failing to update one’s contact information in a notice provision can have significant repercussions.

In Hudson Valley Bank, plaintiff sought to recover on a promissory note and a personal guaranty, both of which were executed by defendant. Defendant failed to appear or answer the complaint. Plaintiff was subsequently granted leave to enter a default judgment against defendant, and, after an inquest on the issue of damages, a judgment was entered in favor of plaintiff and against defendant in the principal sum of $127,860.26.

Thereafter, defendant moved (a) to vacate the judgment, arguing, among other things, lack of personal jurisdiction, and (b) to dismiss the complaint for lack of personal jurisdiction. Defendant argued that service was invalid because he never resided at the address set forth in the affidavit of service. In support of his motion, defendant submitted his own affidavit and documentary evidence, including utility bills and his New York State driver license, to substantiate his assertion that he never resided at the service address.

In opposition to defendant’s motion, plaintiff relied upon the affidavit of service to establish that defendant was served at his residence. Plaintiff argued, among other things, that defendant should be estopped from challenging the propriety of the service address, as that address had been provided by defendant and set forth in the personal guaranty, and defendant had personally and affirmatively agreed to receive written notice at that location and to notify plaintiff if and when his address changed.

The motion court denied defendant’s motion. The motion court concluded that the affidavit of service constituted prima facie evidence of proper service and that defendant’s evidentiary submissions were insufficient to rebut the presumption of proper service established by the affidavit of service. 

On appeal, the Appellate Division, Second Department affirmed, “albeit on grounds different from those relied upon by the [motion court]”.1

As an initial matter, the Court held that because defendant raised a jurisdictional objection under CPLR § 5015(a)(4)2 as a basis for vacating the default judgment, the motion court was required “to resolve the jurisdictional question before determining whether it [was] appropriate to grant a discretionary vacatur of the default under CPLR 5015(a)(1)”.3 

“Service of process upon a natural person must be made in strict compliance with the statutory methods of service set forth in CPLR 308.”4 “The failure to comply with the specific mandates of CPLR 308(4)”, said the Court, “is a jurisdictional defect, and ‘notice received by means other than those authorized by statute cannot serve to bring a defendant within the jurisdiction of the court.’”5 Service “is invalid if the service address is not, in fact, the defendant’s actual place of business, dwelling place, or usual place of abode”, noted the Court.6 

“Ordinarily, a process server’s affidavit of service establishes a prima facie case as to the method of service and, therefore, gives rise to a presumption of proper service”, said the Court.7 The Court found that the motion court “properly determined, the affidavit of service demonstrated, prima facie, that the defendant was served with the summons and complaint pursuant to CPLR 308(4) by affixing a copy of the summons and complaint to the door of his actual dwelling place, and by mailing a copy of the summons and complaint to his last known residence.”8

Turning its attention to defendant’s argument that service was invalid because he did not reside at the address set forth in the affidavit of service, the Court agreed with plaintiff that “defendant should be estopped from challenging the propriety of that address.”9

“Estoppel, in this context,” explained the Court, “may preclude a defendant ‘from challenging the location and propriety of service of process if that defendant has engaged in affirmative conduct which misleads a party into serving process at an incorrect address’”.10 For example, said the Court, “where a defendant willfully misrepresented his address or violated a statutory notification requirement (see Ray v Metropolitan Transp. Auth., 221 AD2d 613), or where he engaged in conduct calculated to prevent the plaintiff from learning his actual place of residence (European Am. Bank & Trust Co. v Serota, 242 AD2d 363, 364 [internal quotation marks omitted]), he may be estopped from asserting the defense of defective service”.11 

The Court found that “the record established that the defendant engaged in ‘affirmative conduct which misl[ed] a party into serving process at an incorrect address’”.12 “Under the circumstances,” concluded the Court, “the defendant should have been estopped from contending that the address set forth in the affidavit of service was not his ‘dwelling place’ (CPLR 308[2]), and that branch of the defendant’s motion which was pursuant to CPLR 5015(a)(4) should have been denied on this ground.”13


Although often an afterthought in contract negotiations, parties should give the notice provision more attention both during contract negotiations and after execution of the agreement. Hudson Valley Bank highlights the consequences of not keeping the information contained in the notice provision updated.

Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP.

This article is for informational purposes and is not intended to be and should not be taken as legal advice.


  1. Slip Op. at *2.
  2. Pursuant to CPLR § 5015(a)(4), “[t]he court which rendered a judgment or order may relieve a party from it upon such terms as may be just, on motion of any interested person … upon the ground of … lack of jurisdiction to render the judgment or order”. See Paulus v. Christopher Vacirca, Inc., 128 A.D.3d 116, 122 (2d Dept. 2015).
  3. Id. (quoting HSBC Bank USA, N.A. v. Dalessio, 137 A.D.3d 860, 862-863 (2d Dept. 2016) (internal quotation marks omitted); and citing Wells Fargo Bank, N.A. v. Besemer, 131 A.D.3d 1047, 1047-1048 (2d Dept. 2015).
  4. HSBC Mtge. Corp. (USA) v. Hollender, 159 A.D.3d 883, 883 (2d Dept. 2018).
  5. Slip Op. at *2 (quoting Feinstein v. Bergner, 48 N.Y.2d 234, 241 (1979)).
  6. Id. (citing Everbank v. Kelly, 203 A.D.3d 138, 147 (2d Dept. Feb. 2, 2022)).
  7. Id. (citations omitted).
  8. Id.
  9. Id.
  10. Id. (quoting Everbank, 203 A.D.3d at 145).
  11. Id. (quoting Bank of New York v. MacPherson, 301 A.D.2d 485, 486 (2d Dept. 2003) (internal quotation marks omitted)).
  12. Id. at *2-*3 (quoting Everbank, 203 A.D.3d at 145; additional citations omitted).
  13. Id. at *3.
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