| Matter of Calabrese Bakeries, Inc. v Rockland Bakery, Inc. |
| 2011 NY Slip Op 03596 [83 AD3d 1060] |
| April 26, 2011 |
| Appellate Division, Second Department |
| In the Matter of Calabrese Bakeries, Inc., et al.,Appellants, v Rockland Bakery, Inc., Respondent. |
—[*1] Higgins, Roberts, Beyerl & Coan, P.C., Niskayuna, N.Y. (Michael E. Basile of counsel), forrespondent.
In a proceeding, in effect, inter alia, pursuant to Business Corporation Law §§1008 and 1117 (a) to suspend or annul the judicial dissolution of B.M. Baking Company, Inc.,pursuant to a judgment of the Supreme Court, Rockland County (Smith, J.), dated December 15,2005, the petitioners appeal, as limited by their brief, from so much of an order and judgment(one paper) of the same court (Nelson, J.), dated August 10, 2009, as denied those branches oftheir petition which were to suspend or annul the judicial dissolution of B.M. Baking Company,Inc., and dismissed the proceeding without prejudice.
Ordered that the order and judgment is affirmed insofar as appealed from, with costs.
In a proceeding commenced by the respondent, Rockland Bakery, Inc., the Supreme Courtrendered a judgment dated December 15, 2005, on default, dissolving B.M. Baking Company,Inc. (hereinafter B.M. Baking), pursuant to Business Corporation Law § 1104 (seeMatter of Rockland Bakery, Inc. v B.M. Baking Co., Inc., 84 AD3d 1080 [2011] [decidedherewith]). On September 25, 2008, the appellants, B.M. Baking, Calabrese Bakeries, Inc.(hereinafter Calabrese), a 50% shareholder of B.M. Baking, and Rose Melino and LucindaMelino, who are shareholders of Calabrese, commenced this separate proceeding in SupremeCourt, Columbia County, to suspend or annul the judicial dissolution. The appellants alleged,among other things, that the financial affairs of B.M. Baking had not been properly determinedand that the judgment dissolving B.M. Baking was improperly entered because venue wasimproper, and the appellants and other interested persons did not receive adequate notice of theproceeding. The Supreme Court, Columbia County, transferred this proceeding to the SupremeCourt, Rockland County, which, in the order and judgment appealed from, inter alia, dismissedthe petition without prejudice to the appellants seeking relief in the original judicial dissolutionproceeding. We affirm the order and judgment insofar as appealed from.
A motion for relief from a default judgment must be brought in the original action orproceeding. A plenary action or proceeding for such relief will not lie (see James vShave, 62 NY2d 712, 714 [1984]; Babu v 29 Cortlandt St. Realty Corp., 289 AD2d273 [2001]; New York Sign & Supply-Impressive Prods. v Delong Realty Co.,, 282AD2d 510 [2001]; Levine v Berlin, 46 AD2d 902 [1974]). There are virtually [*2]no exceptions to this well-established rule (see Oppenheimer vWestcott, 47 NY2d 595, 602-603 [1979] [the court assumed, without deciding, that anindependent action by an interested nonparty might be viable on grounds that the judgment wasprocured by fraud]; see generally 10-5015 Weinstein-Korn-Miller, NY Civ Prac CPLR¶ 5015.13). Accordingly, to the extent that the petition herein is, in effect, an applicationfor relief from B.M. Baking's default by vacating the judgment dated December 15, 2005, theappellants were required to make that application in the original judicial dissolution proceeding.Subsequent to the order appealed from, the appellants did move to vacate the default judgment inthe judicial dissolution proceeding, and their appeal from the denial of that motion is determinedin the companion case (see Matter of Rockland Bakery, Inc., v B.M. Baking Co., Inc., 83AD3d 1080 [2011] [decided herewith]).
Moreover, to the extent that the petition herein, in effect, seeks to "suspend or annul" thedissolution pursuant to Business Corporation Law § 1008, the Supreme Court properlydirected the appellants to make that application in the original judicial dissolution proceeding.Business Corporation Law § 1008, which is contained within article 10 of the BusinessCorporation Law governing nonjudicial dissolutions, is made applicable to judicial dissolutionproceedings through Business Corporation Law § 1117 (a), a section within article 11 ofthe Business Corporation Law governing judicial dissolutions. In the context of judicialdissolutions, this Court has noted that Business Corporation Law §§ 1005 through1008 contain the "[p]ostdissolution procedures in a judicial dissolution proceeding" (Matterof Ravitz v Gerard Furst & Marjorie Ravitz, DPM, P.C., 65 AD3d 1049, 1050 [2009][internal quotation marks omitted]). Those postdissolution procedures, therefore, are routinelyapplied in the original dissolution proceeding (id.; see Matter of Oak St. Mgt.,307 AD2d 320 [2003]; Matter of Sternberg [Osman], 181 AD2d 899 [1992]). Thisoutcome is consistent with Business Corporation Law § 1117 (b), which provides that,where a corporation is dissolved pursuant to judicial dissolution under article 11, "the court mayretain jurisdiction for the purpose of making [orders pursuant to Section 1008] after thedissolution, in such action or special proceeding." While Section 1117 (b) also gives the courtdiscretion to "make such orders in separate special proceedings, as provided in section 1008,"where, as here, the success of the appellants' application to suspend or annul the judicialdissolution is largely dependent upon their application for relief from a default judgment, theSupreme Court providently determined that the application would be appropriately made in theoriginal proceeding, rather than in an independent or collateral proceeding.
Accordingly, the Supreme Court properly dismissed the instant proceeding without prejudiceto the appellants' right to seek appropriate relief in the original dissolution proceeding pursuant toBusiness Corporation Law § 1008, CPLR 317, or CPLR 5015. Rivera, J.P., Angiolillo,Eng and Sgroi, JJ., concur.