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CIT Technology Financing Services, Inc. v. Starnet Design and Lithograph, Inc.

Superior Court of New Jersey, Appellate Division

June 21, 2013

CIT TECHNOLOGY FINANCING SERVICES, INC., Plaintiff-Appellant,
v.
STARNET DESIGN AND LITHOGRAPH, INC. and PETER DIPAOLA, Defendants-Respondents, and TOM RANNO, ALEX BLACKWELL and PETER MANCINELLI, GUARANTORS, J/S/A, Defendants.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted February 26, 2013

On appeal from the Superior Court of New Jersey, Law Division, Burlington County, Docket No. L-1417-10.

Saldutti, LLC, attorneys for appellant (Thomas B. O'Connell, on the brief).

Kaps & Barto, attorneys for respondent Starnet Design and Lithograph, Inc. (Raymond Barto, on the brief).

Law Offices of Thomas W. Williams, attorney for Peter DiPaola, joins in the brief of respondent Starnet Design and Lithograph, Inc.

Before Judges Messano and Ostrer.

PER CURIAM

Plaintiff, CIT Technology Financing Services, Inc. (CIT), filed a complaint alleging, among other causes of action, that defendant, Starnet Design and Lithograph, Inc. (SDL), defaulted on three leases with plaintiff for various business equipment. Peter DiPaola, Tom Ranno, Alex Blackwell and Peter Mancinelli were also named as defendants (the individual defendants), it being alleged that they executed personal guaranties of payment as to one of the leases (the first action).

The Law Division subsequently entered judgment in favor of plaintiff against SDL in the amount of $289, 894.18, plus attorney's fees of $30, 000, for a total of $319, 894.18. Judgment was entered against the individual defendants in the amount of $224, 977.74, plus attorney's fees of $25, 000, for a total of $249, 977.74.

In supplementary proceedings, see R. 4:59-1(f), plaintiff deposed SDL's designee, Douglas Arbolino. Arbolino testified that he formed StarNet Business Solutions (SBS) and acquired all the shares of stock issued by SDL. Plaintiff then filed a subsequent action naming as defendants: SBS, Starnet Graphix Inc. (Graphix), Starnet Media Group, Inc., SDL, Arbolino, and the individual defendants. In this second action, plaintiff alleged legal and equitable fraud and violation of the Uniform Fraudulent Transfer Act (UFTA), N.J.S.A. 25:2-20 to -34. In a third count, plaintiff alleged SBS and Graphix were liable as "successors-in-interest" of SDL.

The individual defendants moved for summary judgment. In support of the motion, they attached a statement of material facts, DiPaola's certification, the "Stock Purchase Agreement" (the Purchase Agreement) between SDL and SBS, and the unconditional guaranty of Arbolino and SBS to indemnify and guaranty certain obligations of SDL and the individual defendants. The record does not reveal what, if any, action was taken on defendants' motion.

CIT then filed a motion in the first action seeking "an accounts receivable levy on any pending payments to [SDL] pursuant to the [Purchase Agreement] under N.J.S.A. 2A:17-63, " and "an assignment of [SDL's] rights and credits under the [Purchase Agreement] pursuant to N.J.S.A. 2A:17-59." In support, CIT attached portions of Arbolino's deposition testimony and the documents filed by the individual defendants in support of their summary judgment motion. The individual defendants' statement of material facts claimed that SBS purchased all the stock of SDL and assumed all its debts, including the lease with CIT for one of the printers, an "Indigo 6 color digital press." That machine was listed on a schedule in the Purchase Agreement for which Arbolino and SBS executed guarantees of payment. The Purchase Agreement also provided for the retention of the individual defendants, except Blackwell, "under the terms of separate employment agreements to be executed at or before closing."

CIT requested oral argument if opposition was filed. See R. 1:6-2(d) ("A party requesting oral argument may . . . condition the request on the motion being contested."). No opposition was filed. Without granting oral argument, the Law Division judge entered an order dated April 27, 2012, denying CIT's motion. The order simply stated, "[p]laintiff seeks to obtain a private levy for which there is no provision in the statutes referenced by counsel." The judge ...


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