Martinez v Best Auto Group

[*1] Martinez v Best Auto Group 2017 NY Slip Op 50973(U) Decided on August 2, 2017 Civil Court Of The City Of New York, Bronx County Kraus, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on August 2, 2017
Civil Court of the City of New York, Bronx County

Joel Martinez, Claimant,

against

Best Auto Group and International Auto Mall and Leasing Center LLC s/h/a International Auto Mall & Leasing Center, Inc., Defendants.



SCB 380/2017-1



JOEL MARTINEZ

Claimant, pro se

2105 Ryer Avenue, No.1I, Bronx, NY 10457

MURRAY HONIG, ESQ.

Attorney for Defendant

88 Middle Neck Road, Great Neck, NY 11021

INTERNATIONAL AUTO MALL AND LEASING CENTER, LLC

Defendant, pro se

Attn: Marcos Benzaquen

3981 Boston Road

Bronx, NY 10466
Sabrina B. Kraus, J.

BACKGROUND

JOEL MARTINEZ(Claimant) commenced this action, seeking $4600.00, for return of deposit, and other alleged damages, pertaining to the purchase of a vehicle purchased from defendants on October 13, 2016. BEST AUTO GROUP INC. (Defendant) is an active New York Corporation, and the entity with which Claimant negotiated the purchase and to which Claimant provided the down payment. INTERNATIONAL AUTO MALL & LEASING [*2]CENTER INC.(IAMLC) was the seller under the contract executed by the parties and is an inactive corporation which was "merged out" effective August 11, 2016, and upon information and belief, was merged into International Auto Mall and Leasing Center LLC as of the same date.[FN1]

The pleadings and the caption are therefor amended to reflect the second Defenant herein as International Auto Mall and Leasing Center LLC.

Defendant filed a counterclaim against Claimant seeking $4047 for nonpayment of services rendered and loss of use of property.

On March 28, 2017, the parties appeared pro se, and the proceeding was adjourned for Defendant to obtain counsel and for a Hebrew interpreter. The action was adjourned one more time for the same purpose.

The trial commenced on June 27, 2017 and continued and concluded on August 1, 2017, and the Court reserved decision. On June 27, 2017 all parties were present. Claimant testified first. The court began to mark Defendant's documents and in conjunction with this, some limited testimony from Zvi Zmorra (ZZ), President of Defendant, was elicited. The action was then adjourned to August 1, 2017 for continued trial.

On August 1, 2017, IAMLC did not appear. Defendant advised the court that Marco Benzaquen, who identified himself as President of IAMLC, had a request for an adjournment. The court received no documentation pertaining to same until after the conclusion of the trial on August 1, 2017. As such IAMLC's request for an adjournment was denied, and the trial completed on default of IAMLC appearing.[FN2]

On that day, Claimant's testimony was reopened at the request of Defendant. Claimant rested, Defendant presented the testimony of ZZ and rested, and the court reserved decision.

FINDING OF FACTS

On or about September 16, 2016, Claimant went to Defendant to purchase a car. Defendant's showroom is located at 4053 Boston Road, Bronx, NY 10466. Claimant purchased a 2006 BMW X5 from Defendant on that date

Defendant provided Claimant with a contract to sign (Ex 4). The contract listed the seller as IAMLC, and further provided that the contract was assigned upon execution to Credit Acceptance Corporation (CAC). The contract directed Claimant to make all future payments to CAC. There was no evidence offered in the record as to why IAMLC is listed as the seller rather than the Defendant. Both sides agree that Claimant gave Defendant a down payment. ZZ [*3]testified that IAMLC did the financing for the transaction, but that appears to be directly contradicted in the contracts which list CAC as the lien holder on the vehicle.

The contract acknowledges a $2600 down payment on ths first page. Claimant testified the initial down payment was for $2600.00. ZZ testified that the initial down payment he received was $1900, and that he made a side deal with Claimant to pay the additional $700 later, notwithstanding the amount reflected in the contract. ZZ submitted a "Promissory Note" as Exhibit D, which he alleges was signed by Claimant. The note is undated and neither the name nor the title of the individual allegedly signing for Defendant is indicated on the document. ZZ testified that it was signed by his son Etai Zmora, whom he testified is the General Manager of Defendant, and that he witnessed Claimant signing the document as well. The court credits Claimant's testimony over that of ZZ, and finds that the amount of the initial deposit received by ZZ was $2600, not $1900, and that the signature on Exhibit D does not belong to Claimant.

Within a week, Claimant noticed the check engine light was illuminated and returned the car to Defendant. Defendant attempted to repair the vehicle, but after having the car for approximately three weeks, the issue was not resolved and Claimant asked for his down payment back. Defendant refused, but offered to sell Claimant another car, a 2011 3 Series BMW, for an additional deposit of $2900, and a higher monthly payment.

On October 13, 2016, Claimant paid the additional $2900.00 deposit to Defendant, and purchased the 2011 BMW. A second contract was given to Claimant to sign on that date (Ex 3). This contract again listed IAMLC as the seller, and CAC as the assignee, and reflected that Claimant provided a security deposit totaling $5500.00. The second contract lists two purchasers. In addition to Claimant, Cirilo Martinez (CM) is listed as a purchaser. There was no explanation or additional information provided pertaining to CM at trial.

Two days after purchasing the 2011 BMW, the car began to overheat. Claimant brought the car back to Defendant. Defendant had the car for approximately one month before repairing it and returning it to Claimant. Within one hour of picking up the car the problem re-occurred. Claimant again brought the car back to Defendant, who kept the car for another three weeks. Claimant then had a problem with the car stalling. Again, Claimant returned the vehicle to defendant, Defendant repaired the vehicle, and Claimant picked up the vehicle.

Based on Claimant's credible testimony, the court finds the following was the time line for the sequence of events. Claimant purchased the 2011 BMW on October 13, 2016, and drove it off lot that day. Claimant returned the car for repairs on or about October 15, 2016, where it remained until mid November 2016.

On or about November 14, 2016, Defendant attempted to register the vehicle through a service, Defendant uses for such purposes, but the registration was rejected (Ex B) because the insurance card, listed the 2011 vehicle as a replacement vehicle, and Defendant had never registered the first car sold to Claimant. ZZ was quite evasive in explaining why he waited so long to register the vehicle. First he stated he had 45 days to submit the registration under the law. Then he testified that "it takes time to get the title from the auction" indicating to the court that possibly ZZ did not have clear title on the date he sold the vehicle to Claimant, which presumption is further supported by CACs subsequent cancellation of the contract between the parties, and the fact that Defendant failed to offer any documentation showing that it had title on the date of the sale in question, or any of the documents they were required to keep in connection [*4]with the issuance of plates to Claimant, and the submission of the registration.

On or about November 15, 2016, Claimant again picked up the car, but returned it for additional repairs the same day. The car remained Defendant's possession for approximately another three weeks. On or about December 2, 2016, Claimant picked up the car, began to drive towards Connecticut, and was stopped by a State Trooper, who informed Claimant that the car was not registered to Claimant, that there was no valid registration for the vehicle, no insurance, and the car was impounded by the State Trooper. The total amount of time Defendant was in possession of the car was less than 3 days.

On or about December 6, 2016, Defendant picked up the car from the impound, after paying $196.24, and the car has remained on Defendant's lot since that date. Defendant refused to release the car to Claimant without payment of additional monies claimed due, including charges for parking tickets and towing.

Claimant had the first vehicle he purchased insured and provided an insurance card for same to Defendant. Said insurance was effective September 16, 2016 (Ex 2, page 4). After returning the first vehicle and purchasing the second vehicle, Claimant again provided Defendant with proof of insurance effective October 14, 2016 (Ex A). This insurance card indicated that it was for a replacement vehicle, in the lower left hand corner. Insurance for the second vehicle was cancelled as of November 6, 2016, due to Claimant's failure to make payments (Ex 6 & Ex 2, p.4)

The license plate provided to Claimant by Defendant was HJY 1790.

Three parking tickets were issued for the 2011 BMW, two on November 30, 2016 and one on November 22, 2016. One of the November 30, 2016 tickets was for failure to show a current registration sticker, the other two tickets were for an expired meter and parking in a cross walk (Ex 1). As indicated above the court credits Claimant's testimony that on these dates the car was in the possession of Defendant.

Defendant never received a Certificate of Title for the vehicle.

In December 2016, Claimant received a call from CAC who stated they were cancelling the contract because the dealership could not provide clear title to the vehicle, and there was a lien on the vehicle.

On or about January 26, 2017, Claimant went to Defendant's place of business to demand the return of his down payment. Claimant and Ziv Zmora got into a physical altercation, resulting in Claimant's arrest and the issuance of an order of protection (Ex G). Claimant alleges that he was provoked by defendant and his staff on said date. The court finds said testimony credible.

On February 14, 2017 CAC sent a letter, to Claimant and CM canceling the contract, stating the account had been closed, and asking Claimant had to return the car to IAMLC (Ex 2). The court deem said request was moot given that Defendant remains in possession of the vehicle, and by ZZ's own admission was actively involved in processing the transaction despite the fact that the contract listed IAMLC as the dealer and not the Defendant.

ZZ testified that in March 2017 he surrendered the plates to DMV.

DISCUSSION NY Veh. & Traf. § 417 pertains to certificates by retail dealers on sales of second hand

motor vehicles and provides that:

Upon the sale or transfer of title by a retail dealer of any second hand motor vehicle, intended for use by the buyer, his agent or representative upon the public highways, the vendor shall execute and deliver to the vendee an instrument in writing, in a form prescribed by the commissioner, in which shall be given the make, year of manufacture and identification number of the said motor vehicle, the name and address of the vendee, and the date of delivery to the vendee. Such notice shall also contain a certification that said motor vehicle complies with such requirements of this chapter as shall be specified by the commissioner and that it is in condition and repair to render, under normal use, satisfactory and adequate service upon the public highway at the time of delivery.

The failure of the vendor to deliver to the vendee the certificate required by this section .... shall constitute a violation of this section.

ZZ testified that he issued registration plates to Claimant along with a Temporary Certificate of Registration to Claimant, and that he did so through the Dealer Plate Issuance Program.

Pursuant to the DMV Dealer Plate Issuance Manual several documents would have been submitted by Defendant in connection with the issuance of a temporary certificate of registration, including proof of ownership by the Dealer (DMV Dealer Plate Issuance Manual MV-461 (6/17), § 3.1). Based on the testimony of ZZ that sometimes it takes time to get title from the auction, it is possible that ZZ did not timely submit the registration for the car because Defendant did not have title to the car when sold to Claimant.

Defendant submitted no evidence that they provided Claimant with an MV-50 or a "Certificate of Sale" as required. Similar requirements are set forth in 15 NYCRR § 78.11(b)., which would have also required Defendant to provide an MV-103 Odometer and Damage Disclosure Statement, as well as a lemon law Bill of Rights and written warranty as required by NY Gen Bus. Law § 198-b. Similarly applicable to the sale would be the implied warranty or merchantability (UCC § 2-607(1)), as well as the warranty of title set forth in UCC § 2-312.

The car as delivered was clearly not in condition and repair for normal use on public highways as required by VTL § 417.

At trial, ZZ testified that there was no problem with the fact that he waited a month to submit the registration and that under the law he had 45 days to make such submission. This is false, and the court believes that ZZ knew this to be false at the time of his testimony. Though a temporary registration is indeed valid for 45 days, 15 NYCRR § 78.23(e) requires the dealer issuing a temporary registration, which ZZ testifies he did, to submit a registration and title application within 5 calendar days of issuance of the temporary registration. The same provision requires the dealer to keep records pertaining to all such submissions. Again records which were never produced by Defendant, who was represented by counsel.

§ 2114 of the Vehicle and Traffic Law governs the transfer of ownership from dealers and records requirements and provides:

(a) If a dealer buys a vehicle and holds it for resale and procures the certificate of title from the owner within ten days after delivery to him of the vehicle, he need not send the [*5]certificate to the commissioner but, upon transferring the vehicle to another person other than by the creation of a security interest, shall promptly execute the assignment and warranty of title by a dealer, showing the names and addresses of the transferee and of any lienholder holding a security interest created or reserved at the time of the resale, in the spaces provided therefor on the certificate or as the commissioner prescribes, and mail or deliver the certificate to the commissioner with the transferee's application for a new certificate. The assignment and warranty of title by a dealer required by this section shall include a statement, signed by the dealer stating either (i) any facts or information known to him that could reasonably affect the validity of the title of the vehicle, or (ii) that no such facts or information are known to him.(b) Every dealer shall maintain a record in the form and for a period of time the commissioner prescribes of every vehicle bought, sold or exchanged by him, or received by him for sale or exchange, which shall be open to inspection by a representative of the commissioner, a peace officer, when acting pursuant to his special duties, or a police officer during reasonable business hours.

Again this supports the negative inference made by the court based on Defendant's failure to produce documents that should have been made and kept by them as required by law and in the ordinary course of their business.

The court finds that Claimant is entitled to the return of the monies paid to Defendant as a down payment for the vehicle. It is undisputed that the contract was cancelled by CAC, the assignee. It is unclear that Defendant ever had any legal right to sell the vehicle or receive the down payment. The vehicle required such extensive repairs that Defendant could not really deliver it to Claimant until early December 2016, and then Claimant was in possession of the vehicle for less than 24 hours.

The court is particularly troubled by Defendant's failure to submit relevant documentation it was clearly in possession of as to when and how it obtained title for the vehicle.

Claimant is awarded a judgment for the $4600.00 sued for plus interest from October 13, 2016 as against Best Auto Group Inc. and International Auto Mall and Leasing Center, LLC, jointly and severally. Though Claimant established a higher amount in damages, the amount sued for was $4600, and there was no request to amend to an increased dollar amount at trial.

Defendant's counterclaim against Claimant is dismissed.

This constitutes the decision and order of this court.

Dated: August 2, 2017

Bronx, NY

_________________________

Hon. Sabrina B. Kraus Footnotes

Footnote 1:No evidence was provided by the parties as to the corporate status of the defendants. The information is taken by the court from the New York State Department of State website for corporations. Printouts evidencing said information as shown on the website, have been added to the file by the court as shall be identified as Court Exhibits aa -cc.

Footnote 2:The written request was dated July 26, 2017 and stamped received by the court on August 1, 2017. It was not forwarded to the court by the clerk until after the trial had been completed and decision reserved. At the time of the trial, it had not yet been delivered to the Part Clerk. The letter requested an adjournment as Mr. Benzaquen had two ultra sound tests he had scheduled for 8/1/17 in the morning, and requested a postponement of the trial until after August 17, 2017.