Vanderpool v Porter's Concrete Serv., Inc.

[*1] Vanderpool v Porter's Concrete Serv., Inc. 2006 NY Slip Op 51991(U) [13 Misc 3d 1226(A)] Decided on October 18, 2006 Supreme Court, Tioga County Lebous, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. As corrected in part through November 6, 2006; it will not be published in the printed Official Reports.

Decided on October 18, 2006
Supreme Court, Tioga County

Eli Vanderpool and Patricia Vanderpool, Hidden Lake Development Corp., Plaintiffs,

against

Porter's Concrete Service, Inc., Ralph Porter, Beverly D. Porter, David M. Brown, and Brown & Ciaravino, Defendants.



Porter's Concrete Service, Inc. Plaintiff,

against

Eli Vanderpool and Patricia E. Vanderpool, Hidden Lake Development Corporation, and John Doe, Defendants.





30847



Counsel for Vanderpools:

Wiggins and Masson, LLP

By: Walter J. Wiggins, Esq., of Counsel

Office & Post Office Address

308 N. Tioga Street

P.O. Box 399

Ithaca, NY 14851

Counsel for Porters:

Hinman, Howard & Kattell, Llp

By: Thomas W. Cusimano, Jr., Esq., of Counsel

Office & Post Office Address

700 Security Mutual Building

P.o. Box 5250

Binghamton, Ny 13902

Ferris D. Lebous, J.

Ralph Porter and Porter's Concrete Service, Inc. (hereinafter collectively "Porters") have moved to set aside a Decision dated August 11, 2006 of this court after a non-jury trial on March 2, 2006 which held that Eli Vanderpool, Patricia Vanderpool and Hidden Lake Development Corporation (hereinafter collectively "Vanderpools") were not in default of a Mortgage Modification Agreement; dismissing the foreclosure cause of action as premature; and dismissing as moot the motion for an appointment of a receiver (CPLR § 4404).[FN1]

BACKGROUND

The underlying facts have been previously set forth in this court's prior Decision and need not be repeated here at length. However, a brief summary of the timeline of events is as follows: 9-25-1987Original Note and Mortgage between Mr. & Mrs. Jahters and IBMfor $117,000. 12-27-1997Deed from Jachters to Hidden Lake for portion of subject property. 6-2-1999Deed from Jachters to Vanderpools for portion of subject property. 7-23-1999Assignment of Mortgage from Visions f/k/a IBM to Porter's Concrete Service, Inc. 8-15-1999Mortgage Modification Agreement. 8-15-1999License Agreement. October 2002Porters stops mining and terminates license agreement; Vanderpools stop payments. 9-30-2003Decision & Order of Hon. Phillip R. Rumsey. 7-20-2004Decision & Order of Hon. Joseph P. Hester, Jr. 5-20-2005Decision & Order of Hon. Joseph P. Hester, Jr. 3- 2- 2006Non-jury trial before Hon. Ferris D. Lebous. 8-11-2006Decision of Hon. Ferris D. Lebous

By way of this motion, Porters argues that the court's Decision dated August 11, 2006 should be set aside as inconsistent with the prior Decisions & Orders in this matter, as well as the evidence presented at trial. In support of its motion, Porters offers no new evidence and relies solely on its counsel's own affirmation and analysis of the trial evidence. Although the court makes no apology for the conclusions reached or the reasons given, it does acknowledge that the Decision could have been more clearly worded and will attempt to restate - in more succinct terms - the analysis portion of said prior Decision.

DISCUSSION

Initially, Porters takes issue with the court's statement that the License Agreement and the Mortgage Modification Agreement were unambiguous and then seemingly contrary conclusion that the "balloon" payment was just another sum to be paid subject to the suspension provision relating to mining. It is true that this court's prior Decision stated "[i]nitially, both the license and modification agreements at issue are unambiguous" (Decision, p 7). This statement should have read "both the license and modification agreements at issue are unambiguous when read separately from each other." The court's point was - and is - that although standing alone each of these agreements makes perfect sense, ambiguity arises when these two documents are attempted to be read together. And there is no doubt but that these documents must be read together. The parties' testimony at trial was unequivocal that the License Agreement and Mortgage Modification Agreement were intended as a package deal. In other words, the License Agreement clearly meant something in relation to the Mortgage Modification Agreement.

Porters would have this court ignore the ten year term under the License Agreement and interpret the Mortgage Modification Agreement with blinders on and declare the balloon payment due after five years without regard to the part the License Agreement played in the interwoven business negotiations between these parties.[FN2] It was clear to this court based upon the parties' testimony that the parties believed that the Porters' mining activity would generate sufficient funds to pay down the Vanderpools' debt within the original five year period and then anticipated Porters' mining activities to generate royalties from years six through ten. [*2]

However, Mr. Porter unilaterally decided that his mining obligations under the License Agreement were more trouble than they were worth and flagrantly breached his obligations by failing to pursue the necessary mining permits as required under the License Agreement. This court will not reward such behavior by finding that Porters could breach the License Agreement; sit back; and then call the balloon payment due after five years. To find otherwise would allow Porters to unilaterally deny the Vanderpools the anticipated benefit of the bargain they negotiated with Porters in good faith. Moreover, counsels' disagreement with this court's assessment of the credibility of the parties does not warrant grounds to set aside the prior Decision.

Nor does the court find its conclusions to be in conflict with the prior Decisions & Orders of Justices Hester and Rumsey. Those Justices did not have the benefit of hearing the testimony of the parties and assessing their credibility - or lack thereof - nor did either of the prior Justices hold that Porters would not ultimately be entitled to repayment on the note and mortgage at some point in the future.

In sum, this court is not saying that the Vanderpools will get this property for free, but only determining that the final payment is due at the end of ten years (August 15, 2009), unless retired sooner under the License Agreement, and not at the end of the five year term (on July 30, 2004 under the Mortgage Modification Agreement). As concluded in its prior Decision the court once again reiterates that the Vanderpools are not in default under the terms of the Mortgage Modification Agreement and License Agreement and that the cause of action asserting foreclosure is premature and the pending motion for appointment of a receiver is dismissed as moot.

CONCLUSION

By reason of the foregoing, Porters' motion to set aside this court's Decision dated August 11, 2006 is DENIED. No motion costs are awarded.

This constitutes the Decision of the court. The mailing of a copy of this Decision and Order by this court shall not constitute notice of entry.

DATED:October 18, 2006

Binghamton, NY

s/ Ferris D. Lebous

HON. FERRIS D. LEBOUS

Justice, Supreme Court Footnotes

Footnote 1:CPLR § 4405 requires that the post-trial motion be made within fifteen days after the subject decision. This motion was timely filed with the Tioga County Clerk on August 25, 2006 within fifteen days after this court's Decision dated August 11, 2006.

Footnote 2:The Mortgage Modification Agreement states "[p]ayments under this agreement shall not be required at any time when Lender is not mining the mortgaged premises" (¶ 3). While this is not a specific reference to the License Agreement, it certainly is not a typical provision found in the standard mortgage agreement and certainly references, albeit indirectly, the License Agreement which contains the terms and conditions of such mining and for a period of ten years.