In a December 16, 2011 decision by Justice Scheinkman, the court examined whether a contract guaranty to be performed in New York constituted a contract for services to be performed in New York thereby permitting the court to exercise long-arm jurisdiction over the guarantying party. It concluded that it did and dismissed the defendant’s motion to dismiss the complaint grounded on the lack of personal jurisdiction. The plaintiff alleged that the defendant Act Abatement was required under a contract setting forth a New York choice of forum to provide labor and material to a construction project in New York City. The plaintiff asserted several causes of action against the company and against defendant Jeter, a Massachusetts resident, who personally guaranteed the Act’s payment and performance obligations. The complaint alleged that the defendant provided the Jeter Guaranty, signed in Massachusetts, when it was unable to procure a performance bond as required under its contract with the plaintiff. Recognizing that the Second Department had not addressed the jurisdictional question and that the First and Third Departments rendered conflicting decisions, the court turned to the decisions from the federal courts sitting in diversity which virtually all found that a payment guaranty is within the scope of services in New York to confer personal jurisdiction under CPLR § 302(a)(1). Based on those authorities, the court found no reason to exclude financial services from services that fall under CPLR § 302(a)(1) or distinguish between a payment and performance guaranty.
Summit Constr. Servs. Group, Inc. v Act Abatement, LLC, Supt Ct Westchester County, December 16, 2011, Scheinkman, J, Index No. 54085/11