Fashion Page, Ltd. v. Zurich Insurance
406 N.E.2d 747, 428 N.Y.S.2d 890, 50 N.Y.2d 265 (1980)
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Rule of Law:
Service of process on a corporation is valid when a process server reasonably relies on the representations of the corporation's employees to deliver the summons to a person they identify as authorized to receive it, so long as the service is objectively calculated to give the corporation fair notice.
Facts:
- Plaintiff owned a building insured by the defendant, Zurich, a foreign corporation with offices in Manhattan.
- The building was destroyed in a fire on December 30, 1975.
- Plaintiff submitted an insurance claim for over $225,000, which Zurich failed or refused to pay.
- On December 13, 1976, a process server went to Zurich's office to serve a summons and complaint.
- The process server asked the receptionist who handled service of process, and she directed him to Ann Robertson.
- The process server presented the papers to Robertson, who, after reviewing them, said, 'Okay, leave it with me... I’ll take it.' When asked if she was authorized, she replied, 'I can take it.'
- Robertson was the executive secretary to the vice-president and had a regular practice for at least five years of accepting summonses for him when he was unavailable.
- After accepting the summons, Robertson notified her boss, the vice-president, who directed her to forward the papers to Zurich's legal department, which she did.
Procedural Posture:
- Plaintiff commenced an action against Zurich in the New York Supreme Court, the state's trial court of general jurisdiction.
- Zurich moved to dismiss the complaint, arguing that service of process was improper because the summons was delivered to a secretary, not an authorized agent under CPLR 311.
- A hearing was held before a Special Referee, who found the service to be valid.
- The Supreme Court confirmed the Referee's report and denied Zurich's motion to dismiss.
- Zurich, as appellant, appealed to the Appellate Division, an intermediate appellate court.
- The Appellate Division affirmed the trial court's order.
- The Appellate Division then granted Zurich leave to appeal to the Court of Appeals, New York's highest court, on a certified question.
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Issue:
Does delivering a summons to a vice-president's executive secretary, who was identified by the corporation's receptionist and the secretary herself as a person authorized to accept service, constitute valid service of process on the corporation under CPLR 311?
Opinions:
Majority - Wachtler, J.
Yes, delivering a summons to the executive secretary under these circumstances constitutes valid service of process. A process server may reasonably rely on a corporation's own employees to identify the proper person to accept service. When service is made in a manner that, objectively viewed, is calculated to give the corporation fair notice, it should be sustained. Here, the process server went to the corporate offices, made a proper inquiry of the receptionist, and delivered the summons according to the directions of both the receptionist and the secretary who accepted the papers. If the corporation's internal procedures led to service on a person who lacked express authority, the fault lies with the corporation, not the process server who acted reasonably to ensure delivery.
Concurring - Gabrielli, J.
Yes, the service of process was valid, but for a different reason than that offered by the majority. The service is valid because the secretary was an agent impliedly appointed by the corporation to receive process, as evidenced by her long-standing and regular practice of accepting summonses without objection. The majority's focus on the 'reasonableness' of the process server's actions creates a vague and unworkable standard that deviates from the statutory requirement of actual delivery to a proper person. The inquiry should be whether the recipient was, in fact or by implication, a proper agent, not whether the process server tried hard enough.
Analysis:
This decision broadens the scope of valid service on a corporation by recognizing service upon an employee who has apparent or implied authority, even if not explicitly listed in the statute. It shifts some of the risk of improper service from the plaintiff's process server to the corporation itself, holding the company accountable for the representations its employees make at its place of business. The ruling signals that courts will favor a practical, notice-oriented approach over a rigid, technical interpretation of service statutes, thereby making it more difficult for corporations to evade jurisdiction based on their internal personnel structures.
