166 N. 7 St., LLC v. Sung Kyu Khim
Docket 2021-01309
Court of record · Indexed in NoticeRegistry archive · AI-enriched for research
- Filed
- Jurisdiction
- New York
- Court
- Appellate Division of the Supreme Court of the State of New York
- Type
- Opinion
- Case type
- Civil
- Disposition
- Affirmed
- Citation
- 2026 NY Slip Op 02617
- Docket
- 2021-01309
Appeal from an order denying defendants' CPLR 5015(a)(1) motion to vacate a default judgment entered after they failed to oppose a CPLR 3213 motion, and denying a CPLR 5240 protective order.
Summary
The Appellate Division, Second Department affirmed the Supreme Court's denial of the defendants' motion to vacate a default judgment and for a protective order. The plaintiff obtained a judgment after the defendants failed to appear or oppose a summary-judgment-in-lieu-of-complaint motion seeking rent and damages under a commercial lease and guaranty. The defendants later moved under CPLR 5015(a)(1) to vacate the November 2020 judgment and under CPLR 5240 to vacate restraining notices on bank accounts; the court found their excuses for default unreasonable and declined to disturb the restraining notices because they were needed to secure enforcement of the judgment.
Issues Decided
- Whether the defendants showed a reasonable excuse for their failure to appear or oppose the plaintiff's motion for summary judgment in lieu of complaint under CPLR 3213 so as to vacate the judgment under CPLR 5015(a)(1).
- Whether the Supreme Court abused its discretion in denying relief under CPLR 5240 to vacate restraining notices placed on the defendants' bank accounts to enforce the judgment.
Court's Reasoning
The court applied the two-part CPLR 5015(a)(1) standard requiring a reasonable excuse for the default and a potentially meritorious defense. The defendants' stated reasons—ignorance of the law, not having an attorney, and confusion about a conference date—were held not to be reasonable excuses. Because they failed to show a reasonable excuse, the court did not need to reach whether they had a meritorious defense. Regarding CPLR 5240, the court exercised discretion to uphold the restraining notices because they were necessary to secure enforcement of the valid judgment.
Authorities Cited
- Zlobec v Bank of N.Y. Mellon241 AD3d 606
- HSBC Bank USA, N.A. v Joseph209 AD3d 633
- Matter of Lew v Sobel192 AD3d 799
Parties
- Plaintiff
- 166 North 7 St., LLC
- Defendant
- Sung Kyu Khim
- Defendant
- Su Lim Khim
- Judge
- Loren Baily-Schiffman
- Judge
- Colleen D. Duffy
Key Dates
- Decision date
- 2026-04-29
- Index/Action year
- 2020-01-21
- Judgment entered
- 2020-11-25
What You Should Do Next
- 1
Consult counsel about further appeal
If the defendants wish to continue contesting the judgment, they should promptly consult an attorney about grounds and deadlines for seeking further appellate review.
- 2
Consider post-judgment relief options
Defendants should ask counsel to evaluate any available post-judgment relief or settlement options and to address enforcement measures such as bank restraints.
- 3
Comply with enforcement and financial obligations
Until the judgment is vacated or modified, defendants should address asset restraints and consider negotiating payment or security to avoid additional enforcement.
Frequently Asked Questions
- What did the court decide?
- The appeals court affirmed the lower court's denial of the defendants' requests to vacate a default judgment and to remove bank restraints used to enforce that judgment.
- Who is affected by this decision?
- The defendants (Sung Kyu Khim and Su Lim Khim) remain liable under the November 2020 judgment and subject to enforcement actions such as bank restraints.
- Why couldn't the defendants get the judgment vacated?
- They failed to show a reasonable excuse for not opposing the plaintiff's motion; the court found reasons like ignorance of the law and lack of an attorney insufficient.
- Can the defendants still challenge enforcement steps like the bank restraints?
- The appellate court upheld the restraints as appropriate to secure enforcement of the judgment, so those specific challenges were denied here.
- Is further appeal possible?
- A further appeal to a higher court may be possible, but the decision affirms the trial court's exercise of discretion on both motions and limits grounds for reversal.
The above suggestions and answers are AI-generated for informational purposes only. They may contain errors. NoticeRegistry assumes no responsibility for their accuracy. Consult a qualified attorney before relying on them.
Full Filing Text
166 N. 7 St., LLC v Sung Kyu Khim - 2026 NY Slip Op 02617 166 N. 7 St., LLC v Sung Kyu Khim 2026 NY Slip Op 02617 April 29, 2026 Appellate Division, Second Department 166 North 7 St., LLC, respondent, v Sung Kyu Khim, et al., appellants. Supreme Court of the State of New York, Appellate Division, Second Judicial Department Decided on April 29, 2026 2021-01309, (Index No. 509049/20) Colleen D. Duffy, J.P. Paul Wooten Phillip Hom Elena Goldberg Velazquez, JJ. Cole Schotz P.C., New York, NY (Nolan E. Shanahan and Bradley P. Pollina of counsel), for appellants. Berger Fink LLP, New York, NY (David M. Berger of counsel), for respondent. DECISION & ORDER In an action to recover damages for breach of contract, commenced by motion for summary judgment in lieu of complaint pursuant to CPLR 3213, the defendants appeal from an order of the Supreme Court, Kings County (Loren Baily-Schiffman, J.), dated January 21, 2021. The order denied the defendants' motion pursuant to CPLR 5015(a)(1) to vacate a judgment of the same court dated November 25, 2020, entered upon the defendants' failure to appear or oppose the motion for summary judgment in lieu of complaint, and pursuant to CPLR 5240 for a protective order. ORDERED that the order is affirmed, with costs. In 2020, the plaintiff commenced this action against the defendants, Sung Kyu Khim and Su Lim Khim, the owners of a business, Khims Organic, Inc., to recover damages for breach of contract by motion for summary judgment in lieu of complaint pursuant to CPLR 3213. According to the plaintiff, in 2010, it entered into a 10-year commercial lease agreement with Khims Organic, Inc., for a commercial storefront located in Brooklyn (hereinafter the premises). The plaintiff alleged that, in conjunction with the lease, the defendants signed a guaranty obligating them to be jointly and severally liable for the full performance of all agreements in the lease. According to the plaintiff, in August 2018, Khims Organic, Inc., ceased operations and vacated the premises. Khims Organic, Inc., and the defendants made no rental payments after Khims Organic, Inc., vacated the premises. The Supreme Court granted the motion for summary judgment in lieu of complaint upon the defendants' default in failing to appear or oppose the motion and, in November 2020, issued a judgment in favor of the plaintiff and against the defendants in the principal sum of $739,903.31 (hereinafter the November 2020 judgment). The plaintiff thereafter served information subpoenas and restraining notices upon the defendants' bank to enforce the November 2020 judgment. Thereafter, the defendants moved pursuant to CPLR 5015(a)(1) to vacate the November 2020 judgment and pursuant to CPLR 5240 for a protective order vacating the restraining notices. The plaintiff opposed the defendants' motion. In an order dated January 21, 2020, the Supreme Court denied the defendants' motion. The defendants appeal. The Supreme Court properly denied that branch of the defendants' motion which was pursuant to CPLR 5015(a)(1) to vacate the November 2020 judgment. "'In order to vacate a default in opposing a motion pursuant to CPLR 5015(a)(1), the moving party is required to demonstrate a reasonable excuse for the default and a potentially meritorious opposition to the motion'" ( Zlobec v Bank of N.Y. Mellon , 241 AD3d 606, 609, quoting HSBC Bank USA, N.A. v Joseph , 209 AD3d 633, 634). "The determination of what constitutes a reasonable excuse lies within the sound discretion of the Supreme Court" ( Wells Fargo Bank, N.A. v Elsman , 240 AD3d 936, 937 [internal quotation marks omitted]; see Nationstar Mtge., LLC v Ramnarine , 172 AD3d 886, 887). Here, the defendants failed to provide a reasonable excuse for their default, as ignorance of the law, failure to retain an attorney, and confusion about the date of a conference do not constitute reasonable excuses ( see Cox v Marshall , 161 AD3d 1140, 1141; Martinez v Otis El. Co. , 213 AD2d 523, 524). Since the defendants failed to proffer a reasonable excuse for their default, this Court need not address whether they demonstrated a potentially meritorious opposition to the motion ( see Wells Fargo Bank, N.A. v Elsman , 240 AD3d at 937-938). "CPLR 5240 grants the courts broad discretionary power to alter the use of procedures set forth in CPLR article 52" ( Matter of Lew v Sobel , 192 AD3d 799, 800 [internal quotation marks omitted]; see Lisogor v Nature's Delight, Inc. , 189 AD3d 1386, 1388) "to prevent 'unreasonable annoyance, expense, embarrassment, disadvantage or other prejudice'" ( Technology Multi Sources, S.A. v Stack Global Holdings, Inc. , 44 AD3d 931, 932, quoting Paz v Long Is. R.R. , 241 AD2d 486, 487). Here, the Supreme Court providently exercised its discretion in denying that branch of the defendants' motion which was pursuant to CPLR 5240 for a protective order vacating the restraining notices on the bank accounts, as the injunction they imposed was necessary to secure enforcement of the November 2020 judgment ( see Gryphon Dom. VI, LLC v APP Intl. Fin. Co., B.V. , 41 AD3d 25, 38; Ricatto v Ricatto , 4 AD3d 514, 516). The defendants' remaining contention is without merit. DUFFY, J.P., WOOTEN, HOM and GOLDBERG VELAZQUEZ, JJ., concur. ENTER: Darrell M. Joseph