Guyanese Christine Persaud will have another chance in a New York court to argue that her business was unlawfully taken away from her, according to Black Star News.
Two years ago, a State Supreme Court Justice in King’s County allowed a claimant to take over her multi-million dollar business even though she said she had never signed a partnership agreement.
The online publication said an appeals court has reversed the ruling and sent the case back to the lower court.
Black Star News said that the New York State Supreme Court’s Second Appellate Division agreed with Persaud that Judge Arthur M. Schack erred in State Supreme Court King’s county when he confirmed a disputed arbitration ruling that took away Persaud’s multi-million dollar businesses.
Persaud had argued that she had never signed a 50/50 partnership deal with a money lender named Abraham Klein. Klein, according to the report, had agreed to finance her payroll as she awaited receivables. Persaud had established Caring Homecare, a homecare nursing business, and other related companies, in 1997. She says her companies generated close to US$11 million in annual revenue.
Persaud says Klein surprised her with his claim that they had signed a partnership contract. Further, Black Star News said, he insisted they had agreed that all disputes be taken to an arbitrator named Marvin Neiman, of Neiman & Mairanz, P.C., even though Neiman had previously been Klein’s own attorney.
Persaud through her attorney, Eugene Levy, refused to appear before Neiman as arbitrator and sent him a letter rejecting the process. Later, another attorney for Persaud, Samuel Rieff, submitted an affidavit stating that he represented her and Caring Home Care through the end of 2008, during which time she had never sealed a partnership agreement as alleged by Klein.
Black Star News said a “proceeding” was nevertheless held on March 19, 2009 in the absence of Persaud and her attorney, and Klein was awarded by Neiman, 100% control of Caring Homecare, even though he had only claimed 50%.
Further, according to Black Star News, Neiman awarded Klein more than US$2 million in cash even though records showed that he had only put US$100,000 into the business in addition to financing for which he had retained two thirds of the profit from the business. Klein was also awarded 50% stake in another Persaud business, Liberty Homecare, even though he hadn’t filed a claim in relation to it.
Klein moved to have the Neiman arbitration ruling confirmed in State Supreme Court in King’s county. Before the hearing on April 17, 2009, before Judge Shack, Persaud’s attorney filed for a postponement saying he had another case to handle in State Supreme Court in Queens on that same date. According to Black Star News,Judge Shack refused to grant an extension, ruling that Persaud’s attorney’s request was filed with mistakes.
In the absence of both Persaud and her attorney Judge Shack then confirmed the disputed Neiman arbitration ruling. Persaud filed a motion for Judge Shack to vacate his ruling confirming the disputed arbitration ruling and Shack denied the motion.
Persaud was eventually forced out by Klein from the business she had founded. Additionally Klein filed liens against receivables due to Persaud’s second business, Liberty Home Care, and in the following months seized tens of thousands of dollars, she says, according to Black Star News. Persaud, a single parent of three young children, said she feared she would be driven into the streets, and sought bankrupcty protection.
At the same time, Persaud through her attorney filed an appeal on May 3, 2010 to the Second Department, seeking a reversal of Judge Schack’s refusal to vacate his confirmation of the Neiman award to Klein.
The court has now reversed Judge Schack’s ruling. The appeals court also concluded that Persaud seemed to have a meritorious defence.
“On their motion to vacate the order, the appellants established the existence of a potentially meritorious defense,” the appeals court decision reads, “inter alia, by submitting affidavits from the appellant Christine Persaud and her former attorney that she never entered into an agreement to arbitrate disputes….”
“We will be looking for Judge Schack to recuse himself from this case,” Persaud told Black Star News.
