Matter of C. Robert Allen
Annotate this CaseDecided on September 26, 2012
Sur Ct, Nassau County
In the Matter of the Administration Proceeding of the Estate of C. Robert Allen, III, a/k/a CHARLES ROBERT ALLEN, III, Deceased.
2011-364630/D
Judd Burstein, Esq.(for Excelsior Capital LLC and Richard Davis)
1790 Broadway, Suite 1501
New York, NY 10019
Farrell, Fritz, P.C.(for Grace M. Allen, as Executrix of the Estate of
1320 RXR PlazaC. Robert Allen, III)
Uniondale, NY 11556
Sill Cummis & Gross(for Charles Robert Allen, IV, Luke A. Allen
30 Rockefeller Plaza, 29th Floorand Thaddeus Mack Allen)
New York, NY 10112
Louis Fogel, Esq.(for Grace M. Allen, individually)
5 Nottingham Road
Annandale, NJ 08801
Cohen & Gresser LLP(for Responding Defendants)
800 Third Avenue, 21st Floor
New York, NY 10022
Edward W. McCarty, III, J.
In this proceeding for the issuance of limited letters of administration, Grace M. Allen, the decedent's surviving spouse and the executor of his estate moves, pursuant to CPLR 3211(a) (7) and 3212, to dismiss the petition; the motion is opposed.
The petitioner in the underlying proceeding for limited letters is Richard Davis, identified as the managing member and sole owner of Excelsior Capital, LLC, the holder of a $26 million judgment against the estate, obtained after the decedent's death. It appears that JP Morgan Chase is a secured creditor for a debt of approximately $820,000.00. Finally, there is a claim against the decedent's estate by his sons, the beneficiaries of a lifetime trust identified as the "1965 [*2]Trust." They allege that as trustee of the 1965 Trust, the decedent wrongfully diverted $7 million of trust funds, which they claim should be returned to the trust from the decedent's estate. The intermediate accounting filed by Mrs. Allen, as executor, indicates assets on hand as of
October 31, 2011 of $9,627,231.77. Thus, the estate is insolvent and unable to fully satisfy all of its obligations.
The petition, filed on March 9, 2012, seeks limited letters for the purpose of representing the estate to defend the sons' claim against the estate and to pursue a contribution claim against Mrs. Allen for her conduct as a co-trustee of the 1965 Trust. On April 19, 2012, Mrs. Allen executed a document allowing the claim of her sons against the estate. The petitioner contends that Mrs. Allen will not vigorously defend the estate against the claim made by her own sons, a contention borne out by Mrs. Allen's recent decision to allow the claim. To the extent that the sons prove their claim, they will share in the estate with the other creditors commensurately with the value of their claim (Matter of Zalaznick, 94 Misc 2d 988 [Sur Ct, Bronx County 1978]).
Although the petitioner argues that the motion is procedurally defective, the court will overlook those perceived defects and decide the motion on the merits. CPLR 3211(a) (7) permits a party to move to dismiss a claim on the ground that the pleading fails to state a cause of action. "Whether or not evidentiary material is proffered in connection with a motion [pursuant to CPLR 3211(a) (7)] to dismiss a pleading, the pleading will be liberally construed and deemed to allege whatever can be reasonably inferred from its language. The basic criterion is whether the pleading states a cause of action or defense, not whether the allegations can be established by competent evidence" (Weinstein-Korn-Miller, NY Civ Prac § 3211.36, 2d ed.). Here, the petitioner clearly has a cause of action and has clearly identified it. The branch of the motion to dismiss the proceeding for failure to state a cause of action is accordingly denied.
Alternatively, Mrs. Allen moves for an order granting her summary judgment dismissing the proceeding. Mrs. Allen's attorneys argue that petitioner's own conflict of interest makes him unsuitable to serve as a limited administrator. It is true that by this proceeding, petitioner is seeking to secure his own right to the largest part of the estate as possible by defending the estate against the claim of the beneficiaries of the 1965 Trust. However, the petitioner, by allowing his own claim and denying the sons' is in a different position than Mrs. Allen would be by allowing her sons' claim and attempting to deny the petitioner's. The essential difference is that the petitioner's claim has already been adjudicated and a judgment entered in his favor. That the judgment is the subject of an appeal does not alter this fact.
The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). Failure to make such prima facie showing requires a denial of the motion, regardless of the sufficiency of the opposing papers (Winegrad v New York Univ. Med. Center, 64 NY2d 851, 853 [1985]). Once this showing has been made, the burden shifts to the party opposing the motion for summary judgment to produce evidentiary proof in admissible form sufficient to establish the existence of material issues of fact which require a trial of the action (Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). The movant, Mrs. Allen, has failed to establish her right to judgment as a matter of law and her motion for summary judgment dismissing the petition is also denied. [*3]
On a motion for summary judgment, the court may also "search the record" and award summary judgment to a party other than the movant, even without a cross-motion (CPLR 3212[b]). Also, a petition for limited letters of administration under SCPA 702 is always addressed to the discretion of the court (SCPA 102 [38]; Matter of Menitskiy,2009 NY Slip Op 33102U [Sur Ct, Nassau County 2009]). Here, the court is satisfied that Mrs. Allen will not strenuously defend the estate against the claim of her sons and, in fact, has already allowed their claim. The court is convinced that a proper adjudication of the validity of the sons' claim requires that it be defended by a party with an interest in disproving it. Accordingly, the court will exercise its discretion and grant the petition of Richard Davis for limited letters of administration, without bond. However, since the efforts of Richard Davis's attorneys will be primarily to safeguard his own interests, no fees for Mr. Davis's or Excelsior's attorneys will be payable from the estate, except upon application to the court after a determination on the merits of the sons' claim.
This decision constitutes the order of the court and no additional order need be submitted on the motion.
Petitioner's counsel is directed to settle a decree in the proceeding for the issuance of limited letters of administration.
Dated: September 26, 2012
EDWARD W. McCARTY III
Judge of the
Surrogate's Court
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