City of New York v Quincy Marcus 504 Dev. Corp.

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City of New York v Quincy Marcus 504 Dev. Corp. 2021 NY Slip Op 32866(U) December 23, 2021 Supreme Court, Kings County Docket Number: Index No. 511071/21 Judge: Lawrence S. Knipel Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. [*FILED: 1] KINGS COUNTY CLERK 01/05/2022 12:15 PM INDEX NO. 511071/2021 NYSCEF DOC. NO. 241 RECEIVED NYSCEF: 01/05/2022 At an IAS Term, Part Comm 6 of the Supreme Court of the State of New York, held in and for the County of Kings, at the Courthouse, at Civic Center, Brooklyn, New York, on the 23rd day of December, 2021. PRESENT: HON. LAWRENCEKNTPEL, Justice, - -·- - - - - - - - ~ - - - - - - - - -. - - - - - - - - - - - - - - - .., -X THE CITY QFNEW YORK, Plaintiff ·'· -against - Index NO. 511071/21 QurNCY MARCUS 504 DEVELOPMENT CORP'.; CITY OF NEW YORK DEPARTMENTOF FINANCE; NEW YORK ST A TE DEPARTMENT OFTAXATION & FINANCE; CITYOFNEW YORK ENVIRONMENTAL CONTROL BOARD; S.J. FUEL Co.; ALEXANDRA PERDOMO; and "JOHN DOES" #s l-100 1 Said names being fictitious, said persons or entities intended to be tenants and/cir occupants a:nd/or contract vendees of the Premises, and/or the holders of an interest in the subject Pre1hises which is junior and subordinate to the liens of the Plaintiff: Defendants. - - -· - - - - - - " - "'" - - - - - -·-· - - - -···-··- - - - - - - - - - - - -X The following e-filed papers Tead herein: NYSCEF Doc Nos. Notice of Motion/Order to Show Cause/ Petition/Cross Motion and Affidavits (Affirmations) _ _ _ _ _ __ 21-30_ 32 Opposing Affidavits {Affirmations)._ _ __ 198..,224, 226~228 Reply Affidavits (Affirmations),_ _ _ __ 198~224, 226-228 233-234 233-234 Upon the . foregoing papers in this actt on to .foreclose a commercial 1n ortgage on six parcels ofproperty in Brooklyn at: {I) 66 Lewis Avenue (Block 11588, Lot 38}; (2) 1 of 17 [*FILED: 2] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 116 Marcus Garvey Blvd. (Bl,ock 1769, Lot 41).; .(3) 277 Quincy Street (Block 1803, Lot 76); (4) 336 Throop Avenue (Block 1776, Lot 44); (5) 67 -Stuyvesant Ayenµ_e {Block 1599, Lot 4); and (6) 16 Menahan Street (Block 3313, Lot 4) (collectively; the Properties), de(endant Quincy Marcus 504 Development Corp. (Quincy Mateus ·or Borrower) moves (in m.otion sequenc:e· [mot. s~q.] one) for an order~ pursuant to CP.LR 213 (4) and 3212 and RPAPL 1501 (4): (1) granting it summary judgmGnt on i:ts counterclaims m1d dismissing the complaint with prejudice based on the. statute of limitations and la:ck ·of standing; (2) cancelling. ai1d discharging the mortgage 1 . which was re.corded in the City Registefs office. on July 13, 2007 und·er City Register File No. (CRPN) 2007000359592; (3) directing the City Register to. .cancel the mortgage:; (4) .cancelling the note secured by the tnortgc1ge; (5) dismissing plaintiffs second affirmative <;le:fense asserted in its .reply to Quincy JvfarcuS·'· courtterclaiJ:n; -and (6) awarding it co_s.ts and disbursemeiits. Plaintiff The City of New York (the City) cross-moves (in mot seq. two) for an ·order: (1) granting it· summary judgmertt bas·ed on Quincy 'Marcus' defaults under· the note and· mortgage, pursuant to CPLR 32.11 -and 3212; (2) striking and disin1ss:ing Quincy Marcus~ answer, affirmative defenses-.and counterclaim ''on. the grounds that Plaintiff'-s instant ·toreclostit'.e action was timely commenc;ed as a result of the statute of limitations being:-revived . . :~ ($ee NYSCEF Doc No. 198); (}) discon(inuing the action as:: against defondants.Alexa ndra Perdomo and the John boe defendants and amending·the c·aption to 2. 2 of 17 [*FILED: 3] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 remove those parties; (4) appointing a referee to compute the amounts due to the City under the note and mortgage; (5} granting the City a default judgment against all nonappearing defendants, pursuant to CPLR 3215; and (6) denying Quincy Marcus' summary judgment motion. Background On May 11 _. 2021, the City commenced this foreclosure action by filing a summons, a verified complaint and a notice of pendency against the Properties. The complaint alleges that the City is the ''holde1" 1 of a June 20, 2007 note in the original principal amount of $3,741,674;00 executed by Quincy Marcus in favor of the original lender, BPD Bank, which was secured by a mortgage on the Properties {complaintat ,i,i 9-10). The note allegedly provides for interest at 1.25% per annum and that the principal balance was due and payable on October 1,2008, the maturity date of the loan (id. at,i,i ll-12). Regarding the City's standing to foreclose, the complaint alleges that the note and mortgage '\Vere assigned to the Plaintiff, CITY, by assignment of Mortgage_ Instrument dated January 5, 2021 at1d recorded February 23, 2021 at CRFN 2021000065281" (id at ,i 17). Notably, the complaint was filed with exhibits, including: (1) a copy of the June , , 20, 2007 note executec:l by Garyil Bernard on behalf of Quincy Marcus without any endorsement or allonge (see NYSCEF Doc No. 3); (2) a copy of the rnortgage; and (3) a January. 5, 2021 Assignment of Mortgage from Grupo Popular, S.A. as successor in . 3 of 17 [*FILED: 4] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 interest by merger to Grupo Investments Corp., as successor in interest by merger to BPD Bank, as ·'assignor" to the City as "assignee," which was recorded with the City Register's office on February 23, 2021 at CRFN 2021000065281. Notably; the January 5, 2021 Assignment of Mortgage states that the Assignor assigns the mortgage "together with the Note described in said Mortgage and the monies due or to be due thereon" (see NYSCEF Doc No. 5). The complaint alleges that Quincy Marcus defaulted under the mortgage by failing to pay the $3,741,674.00 principal balance of the loan plus interest on the maturitydate and that "by virtue of said defaults, plaintiff City has elected and does hereby elect that the whole of the principal sums outstanding be declared due and payable on the Note and Mmtgage'' (id. at ,i1 19-21 ). The complaint alleges that "no other action, at law or othenvise, has been instituted for the recovery of the sutn of money secured by said Mortgages, or any part thereof' (id, at ~ 27). Importantly, the complaint alleges that Quincy Marcus "has acknowledged the sums due under the Mortgage loan in writing within the last six years and has continued to carry the .Mortgage loan as a valid debt on its books and records';i (id. at ~· 18). On July 15; 2021, Quincy Marcus answered the complaint, denied the material allegations therein, including that it acknowledged the sums due under the mortgage in writing within ~he last six years, as alleged in pafagraph 18 of the complaint. However, Quincy Marcus admitted that "no 1110:nieswere paid on the October J, 2018 maturity date 4 4 of 17 [*FILED: 5] KINGS COUNTY CLERK 01/05/2022 12:15 PM INDEX NO. 511071/2021 NYSCEF DOC. NO. 241 ... '' (answer at RECEIVED NYSCEF: 01/05/2022 ,r 19} Quincy Marcus asserted the following affirmative defenses: (1) the action is barred by the statute of limitations; {2) the City lacks standing to foreclose; and (3)Jhe City failed to satisfy conditions precedent to foreclosure. Quincy Marcus also asserted one counterclaim seeking to cancel the mortgage, pursuant to RP APL 1501 "on the ground that the enforcement of the Mortgage is barred by the applicable statute of limitations;' (id. at ,r 34). The counterclaim alleges that this foreclosure action was filed on May 11, 2021, Quincy Marcus is the owner of record of the Properties, the maturity date of the note is October 1, 2008, which was not extended, "[p]ayments have never been made bn the Note and Mortgage[,]" ''[s]inc1.:: the Note and Mortgage were signed, Quincy Marcus has not agreed in writing to pay the obligations under either the Note or Mortgage," the six.,.year statute of limitations began to run on October 1, 2008, the maturity date of the loan and the period of time to enforce the note and mortgage "has expired" (id. at ,r,r 33-54). On August 2, 2021,. the City filed its reply to Quincy ·Marcus; counterclaim in which it denied the material allegations therein and asserted affirmative defenses, including that Quincy Marcus failed to senie a statutory notice of claim upon the City (second affirmative defense) and that Quincy Marcus "acknowledged the mortgage loan indebtedness in writing within the six~yeats' period prior to Plaintiff filing its mortgage foreclosure proce!!ding)' and identified a Junel5, 2015 letter 1n which Quincy Marcus requested further a<;lvartce·s on the construction loan '~thereby acknowledging the 5 5 of 17 [*FILED: 6] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 mortgage loan debt in writing_," 2018 emails to the City in which Quincy Marcus allegedly ''made written pro1nises to pay th~ -i11ortg&ge ind(lbt!;'.ldness." and ''by carrying said mortgage loan indebtedness on its 2018 taX. returns and chits 2014, 2015, 2016, 2017 and 201-8"·-audited -financial stateinents .. J' (City reply at il 15). The other·,_defeno.ants fail~d to answer or otherwise respond to the=··com_plaint. Quincy Marcus' Summary Judgment Motioi1 On September 2, 202-i, prior· -to any discovery, Quincy Marcus ·111oved for _s_ummary judgment dh;missing· the complaint; the City's -second affirinative defense (failure to serve a notice of claim) and granting its counterclaim,· pursuant to RP APL 1501 (4), for an 9rder canceiing and.·discharging the mortg1:1ge and note based on the st.atute· o"f' Hmitations. Quiricy Marcus contend·s that this fot¢closµre action_ is barred by the six-year statute of lirn.itations and is alsosub.ject to- dismissal based on the City's, lack of standing. Quincy Marcns· submits: an affidavit. from_ its president, Cheryl ighodaro (Ighodaro ); who ·attests that Quincy Marcus has o\vned the Prop.erties since June."20, 2-0.07, "[t]he .Mortgag~ Loan Documents were .signed and were dated June 20~-- 2007" and '~TnJo payments were ever made on the Mortgage Loan Document/' Ighodaro further avers that '"[a]fter the Mortgage Loan Documents were: signed, Quincy Marc.us never made another promise (in writing or otherwise) to pay either the Note 6 6 of 17 or the Mortgag!:'.l so as to extend [*FILED: 7] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 the Mortgage Loan Docµments_ to be -within ·the; ·statute, .of limitations.,,. lghod.aro asserts that "the Maturity Date, of the Mortgage Lalin .Documents i:, October 1, 200.8-- [and· t]his action was commenced on May 1 l; 2021 - mote than twelve and half years after the Maturity Pate· of the Mortgage Loan Document.'·' Quincy Marcus submits. a tnemorandmn. of law arguing_ that it. ~stablished prima facie that this a_ction was comm.enced 111ore than .six years aft~r the maturity date_, and thus, the burden shifts to the City to prove that the statute of)iTI1itatio11s was tolled or is othenvise inapplicable. Quincy Marcus·. asserts. that its standing defense is another ground for dis'niissal since the compl_aint onty annexes an unendorsed copy of the n:ote and '\the pivotal standing issue is if the Note was properly trnnsferredprior to the commencement of this action." Finally, Quiitty Marcus argues that the City's. second affirmative defense to its counterclaim alleging that Quincy .Marcus failed to file a notice ofclah11 shoµld be .dismissed because ''General Municipal Law§ 50-e only-applies to tort claims_~"· Tl1e City's ·Opposition a,ut Sunimary J udg1J1e1tl Cross Motion The City opposes· Quincy Marcus' stunmµ.ry judgment inotion aild cross-moves for ~n ord~r granting.it summary judgment.on the complaint and d_ismissing Quincy Marcus' counterdflim, an order of reference, a default Judgment and other relief The City submits an. affidavit from Kerry LaBotz (LaBotz), the Assistant Cominission.er of ·Pt.eservation Finance of the Departinei1t of Housing Preservation and Developm~nt (HPD). who attests that she is "fully fatniliar with all of the facts and 7 7 of 17 [*FILED: 8] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 circumstance$ .sun~ot.md.ing this action based QI.l [her] ·p~rsonal knowledge, the actions -of employees;.and fl·om books and records- maintairi_ed by Plaintiff City,'~ LaBotz asserts that Quincy Marcus ''admits in its motion papers and in ... its .Ailswer its execution of the :Note and· Mortgage and its default in .non-payment of- the principal balance upon mattirit.y'" and -accordingly ''there is no iss_ue of fact that the Defendant has defaulted under the Note and Mortgage.. " RegardingJh~ City's standing to foreclose, LaBotz: attests that ''both the Note and Mortgage were assigned to the. Plaintiff, CITY,. pursuant to the Assignment of.-Mortgage lnstruinent dated January 5, '2021 and recorded Febtµary 23·, 2021 at. CRFN. 2.021()00:06528-l[,]" as alieged. in paragraph i 7 ·of the verified corrtplaint. LaBotz subrnJts a :tvlay 18, 2007 commitment letter from the City HPD advising Quincy Marcus that h wiil make the $3,741,674.00 construction and mortgage· loan with Banco Popular as -co.:.lender and a. June 20,. 2007 Constrµction .Loan. J;larticipa_tion AgreemenL LaBotz asserts that these documents ''all .-evidence· that HPD funded the loan for the full loan amourit of $3,741,674.00 ... " and notes that paragraph 4 of the Constrlictiot1 Loan Participation Agree1Iient explicitly provides that. BPD Bank ~-'shall take and ..continue.to hoid title to.the Loan Documents in its name but sha11 hold the s:ame as nominee for HPO." LaBotz further attests that "'[d]ocumentary evidence shows that Defendant's claim that no payments have been ma:de undet .the· loan .is" incorrect" ahd references "a [March 22, 2021] payoff letter that had been prepared by HPD's Fiscal Un.it that shows that at -·8 8 of 17 [*FILED: 9] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 least $ lJ,052.92 in interest had been collected by BPD Bank, its successors and assigns, underthe loan/' Notably, however, the March 22, 2021 payoff letter merely identifies the $13,052.92 figure. as "Constructio n Interest Received'' without any indication that the sum was, in fact, ''collected by BPD Bank, its successors and assigns; under the loan" after the October I,· 2008 maturity date ofthe loan. LaBotz ·further asserts that "the Defendant furnished Plaintiff with numerous written acknowledgements and promises of its mortgage loan indebtedness which would revive the Statute of Limitations" and annexes: (1) a May 7, 2018 email from Cargil Bernard of Precise Management, Inc. to Heidi Anderson of HPD advising that "[w ]e will reimburse HPD the $1 Sk for interest instead of seeking new approvals'\ (2) copies of Quincy Marcus; 2014 through 2018 Financial Statement::., "Note 3'' of which identifies "Long-Tenn Debt" of $3,741,674.00 with the notation "Note Payable due April 30, 203.S"; (3) a July 24, 20L8 email from Cargil Bernard of Precise Management, Inc. to Heidi Anderson of FIPD enclosing Quincy Marcus' Audited Financial Statements for 2014 through 2018; (4) Quincy Marcus' 2018 tax returns; and (5) a June 5, 2015 letter from Cargil Bernard (mt Quincy Marcus letterhead) to Ms. Nieves Baez R,ead of Grupo Popular Investments, Inc. advising that "'[w]e are requesting a release of $284,315.16 which represents lntlance of HPD construction loan for the Quincy Marcus 504 Development project." While LaBotz argues that Note 3 of Quincy Marc1,1s' annual financial statements 9 9 of 17 [*FILED: 10] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 "acknowledges in writing the City's $3,741,674.00 mortgage loan as a long'."terfn debt" she fails to explain the accompanying notatioi1 "Note Payable due April 30, 2038." LaBotz argues that Schedule L to Quincy Marcus' 2018 tax returns carries mortgage loans in the aggregate amount of $5,277,931 .00,which "matches" the loan at issue here combined with another unrelated mortgage loan. LaBotz contends that Quincy Marcus "turther acknowledged the loan inwritirtg when it requested in a June 5, 2015 letter to Grupo Popular Investin ents, Corp. release of $284,315.16" which "represents the balance ofthe HPD construction loan for the Quincy Marcus 504 Development project." ·LaBotz asserts that Quincy Marcus' summary judgment motion. "should also be denied in order to allow the parties to engage in discovery, as the numerous documents that have already been attached to Plaintiffs cross motion directly contradicts the Defendanfs blanket assei-tion that it had inade no written promises or acknowledgments of the debt." Speci fie ally, LaB otz argues that by a June 5, 2015 letter, Quincy Marcus·. "requested release of loan funds" '1nd that the City needs discovery regarding ''the circumstances relating to that advance and any correspondence or promises regarding repayment ofthat advance" because "[i]t is possible there were promises made: regarding this advance." LaBotz further argues that the City needs discovery "from the defendant and assignor relating to any payments, receipts, correspondence and agreements exchartgedbetween itsel±: or the assignor's merged entities withthe Defendant." The City also submits a memorandum of law asserting that Quincy Marcus' 10 of 17 [*FILED: 11] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 motion should be denied pursuant to CPLR 3212 (f) "because there are additional facts essential. to justify opposition to the Defendant's motion for Summary Judgment that may exist but which are unavailable to the Plaintiff' and may be in the possession ofQuincy Marcusand/o r BPD Bank, or one of the Banco Popular entities. Quincy Marcus' Reply Quincy Marcus, in opposition to the City's summary judgment cross motion and in further supportofit s summary judgment motion, submits a memorandum of Jaw arguing that its moving papers established, prima fade; that this foreclosure action is barred by the six-year statute of limitations,· and that the City failed to satisfy its burden of proving that the action is not time'"hared. Quincy Marcus claims that the· documents submitted by the City do not prove that the statute of limitations was revived. Quincy Marcus asserts that the May 7, 2018 email from Quincy Marcus' management that states "we Will :reimburse HPD the $18k for interest instead of seeking new approvals" and Quincy Marcus' June 2015 request for an advance do not acknowledge the entire debt, much less an obligation to pay it. Quincy Marcus argues that its financial statements and its 2018 tax return "do not acknowledge an obligation to pay the Mortgage Loan Document'' because General Obligation Law (GOL) § 17-105 requires both an admowledge ment of the debt and a promise to pay the entire indebtedness; Quincy Marcus contends that a financial statement or tax return that merely lists the m011gage as a liability does notconstitute an express promise to pay the 1l 11 of 17 [*FILED: 12] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 mortgage debt. Finally, Quincy Marcus argues that the March 22, 2021 payoff letter produced by the City is not authenticated as a business record and does not.revive the statute of limitations because "[n]o date is set forth when this purported payment was made" Discussion Summary judgment is· a drastic remedy that deprives a litigant of his or her day in court and shouldi thus, only be employed when there is no doubt as to the absence of triable issues ofmaterial fact{Kolivas v Kirchoff, 14 AD3d 493 [2005]; see also Andre v Pomeroy, 35 NY2d 361, 364 [1974]). ''The proponent of a motion for summary judgment must make a prima facie showing of entitlement to judgment, as a matter of Jaw, tendering sufficient evidence to demonstrate the absence of any material issues of· fact"' (Manicone v City of New York, 75 AD3d 535, 537 [201 OJ, quoting Alvarez v Prospect Hosp, 68 NY2d 320,324 [1986J; see also Zuc:kerman v City of New York, 49 NY2d 557, 562 [1980); Winegtad v New York Univ Med. Ctr., 64 NY2d 851, 853 [1985)). If it is determined that the movant has made a prima facie showing of entitlement to summary judgment, "the burden shifts to the opposing party to produce evidentiary proof in admissible fonn sufficient to establish ·the existence of material issues of fact which require a trial of the action1' (Garnham & Han Real Estate Brokers v Oppenheimer, 148 AD2d 493 [1989]). Undet CPLR 213 (4), an action to foreclose a mortgage is governed by a six-year 12 12 of 17 [*FILED: 13] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 statute of limitations (Oakdale Ill, LLC-v Deutsche 8ankNat'.l Tr. Co.~ 189 AD3d 16.85,. 1-687 [2020]). ''The statute of liinitations in 1;1. mortgage Jor:eclosure action begins to rµn from the due date for each unpaid irtstallmertt, or from the time the mortgagee is entitled to demandfull payment, or from the date the mortgage debi has been accelerated (Plaia v Safon_te,. 45 AD3.d 747~ 748 [2007] [emphasis :added]r Thus_, if the borrower faiis to_pay the loan upon the tnaturity date~ the six-year statute of limit~tions begins accruing from the date ot1naturity(see Notarnicola v Lafayette Farms, Inc.,288' AD2d 198, 199 [2001] [holding that ·"(b)ecause Turturro never exercised his option to accelerate-· the entire .irtortgage. debt,. th~ mortgage ·rnatured. on March 25~ 1982, -the· date .of the last scheduled payment {and) the Statute of Limitafions exp~red on March 25, l 98_8n]). Here; Qtiincy Marcus established that the six-year statute of lifoitations began to run on the: debt.on October 1, 2008, the maturity" date· of the ioan. Since the Cjty did n_ot com111¢rtce .this action until May U, 2021, more thai1 12 years after the loan matured, Quincy Marcus has rnet its initial burden of demonstrating, prima fade, that this foreclosure action is untimely: The bm~den then· shifted to the City to present admissible -~vidence.- establi.shing that this actiort was timely commenced _as to Whether ihi;:; or to rajs·e a qu~stion of fact action was timely .c.ommenced (U.S. Bank Nat. Assoc; v Martfrz, 144 AD3d 891, 892 (2016]). The City~ in opposition, has raised triable issues of fact warranting discovery as to whether the- statute of limitations was revived by·.partial _paytnei1ts and Quincy Marcus·' l3 13 of 17 [*FILED: 14] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 express ·acknowledg¢ments ancl prorriise~ to pay the mortgage debtafte.r-the maturity date. The documents produced by the City co_ntradict Quincy Marcus' asse.rtion tha,t it mad_e no written acknowledgment s of the debt after the 2008 maturity date and require discovery. '"''In order that. a part payment shall have the effect of toiling the titne-limitation period,. under the statute- or pursuant to the contract, it must be shown that there· was a payment of a portion .of an aon:iitted debt, 111.ac;le and accepted _as such, accompanied by circmrtstances amounting. to an absolute and unqualified acknowledgmen t by the debtor of more being .due, from which a promise may he interred to pay the remainder;" (Sudit v Eliav, 181 ADJd 955, 957 [202.0] [quoting Lew Morrls. Demolition Co. v Bd. ofEd. fJ.f Cityo/New Yqrk, 40 NY2d 516, 521 (1976)] [holding that release payment to plaintiff's attorney When defendants; purchased the property did not toll. the statute of limitations or a,c;knowledge that the debt was still owed because "plaintiff f~iled to produce a written agreeme_nt or any other ~vidence that the tender of the- release payment was intended to be a partial payment against or acknowledgemen t of a further debt''}; .see also Roth v Michelso·n, 55 NY2d 278, 281 [1982] [holding that "(i)t is a long-standing common-law rule that; if part. payment of a debt otherwise outlawed: by the- Statute-of Liinitatiom;-..is made ~titler citcumsta11ces fro111. which a promise to honor the obligation may be inferred, it will be -effective to make the time liinited for bringing an action start anew from the time such ·payme.Iit"]). ~-'The circumstances of s·uch a: payment "tnay he- pniven. 14 14 of 17 of by extrinsic [*FILED: 15] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 evidence" (Educ. Res. Inst; Inc. v Piazza, 17 AD3d 513, 514 [2005]). "For example, copies of cancelled checks and accompanying memoranda, the debtor's books and records or an admission may demonstrate partial payment and a desire to remit the remaining sum" (id at 514}. General Obligations Law (GOL) § 17-101 provides that "[a]n acknowledgment or promise contained in a writing signed by the party to be charged thereby is the only competent evidence of a new or continuing contracl whereby to take an action out of the operation of the provisions of limitations of time for comtnencing actions· under the [CPLR]." Under GOL 17-105.(1), '"a [Written] promise to pay the mortgage debt, if made after the accrual of a right of action to foreclose the.mortgage , •. either with or without consideration'' makes the time limited for the commencement of the action ''run fro111 the date of the ... promise." Here, the City produced documentary evidence that raises triable. issues as to whether or not the statute oflirnitations. was revived by Quincy Mateus' partial payment, Quincy Marcus' written acknowledge ment of the mortgage loan and an unqualified acknowledgment of more being due, from which a promise may be inferred to pay the remaindet. Quincy Mateus' 2014 through 2018 financial statements acknowledge the City's $3,741,674.00 mortgage loan as a long'.'term debt and contain the notation "Note 15 15 of 17 [*FILED: 16] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 Pay1:1.ble due April 30, 2038[,]'; which suggests that the maturity date of the City's mortgage loan was somehow extended beyond the October l, 2008 maturity date. While Quincy Marcus is correct in arguing that the May 7, 2018 email from Quincy Marcus' management agreeing to "reimburse HPD tlie $t8k for intetest instead of seeking new approvals" and Quincy Marcus' June 2015 request for art advance do not acknowledge the entire mortgage debt, they do raise questions of fact as to whether there is additional documentation that may be u11covered during discovery of a new or continuing contract between the parties and/or an unqualified acknowledgment by Quincy Marcus of the entire mmtgage debt and a ptomise to pay the remaindeL Because there are triable issues of fact as to whether or not this foreclosure action is time-barred, the parties' summary judgment motion and cross motion for summary judgment, an order of reference and a default judgment ate denied with leave to reriew at the conclusion of discovery. Accordingly, it is hereby ORDERED that Quincy Marcus' summary judgment motion (inot. seq. one) is denied with leave to renew afthe conclusion of discovery; and it is fmthet ORDERED that the City's cross motion (mot. seq, two) is only granted to the extent that this action is discontinued as against defendant Alexandra Perdomo. and the "John Doe" defendants and the caption is hereby amended accordingly; the City'$ cross motfon 16 16 of 17 [*FILED: 17] KINGS COUNTY CLERK 01/05/2022 12:15 PM NYSCEF DOC. NO. 241 INDEX NO. 511071/2021 RECEIVED NYSCEF: 01/05/2022 for summary judgment, an order of reference and a default judgment against the non~ appearing defendants is otherwise denied with leave to renew at the conclusion of discovery. This 'constitutes the decision and order ofthe court. ENTER, HON. LAWRENCE KN/PEL ADMINISTRATIVE JUDGE 17 17 of 17

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