Washington Temple Church of God In Christ, Inc. v Global Props. & Assoc., Inc.

[*1] Washington Temple Church of God In Christ, Inc. v Global Props. & Assoc., Inc. 2007 NY Slip Op 51114(U) [15 Misc 3d 1142(A)] Decided on May 31, 2007 Supreme Court, Kings County Battaglia, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 May 31, 2007
Supreme Court, Kings County

Washington Temple Church of God In Christ, Inc., Plaintiff,

against

Global Properties and Associates, Inc., Henry Spitzer and City of New York, Defendants. Ticor Title Insurance Company a/s/o Henry Spitzer, Third-Party Plaintiff, Global Properties and Associates, Inc., Third-Party Defendant,



29690/05



Plaintiff was represented by Rachel J. Yosevitz, Esq. of counsel to Misrok & Misrok. Defendant/ Third-Party Defendant Global Properties and Associates, Inc. was represented by Anil K. Prabhu, Esq. of Max Markus Katz, P.C. Defendant Henry Spitzer was represented by Maria Sideris, Esq. Defendant the City of New York was represented by Paul A. Goetz, Esq. of the New York City Law Department. Third-Party Plaintiff Ticor Title Insurance Company was represented by Andrew Paul Cooper, Esq. and Jonathan M. Cader, Esq. of Hession, Bekoff & Cooper, LLP.

Jack M. Battaglia, J.

"[T]he king cannot grant the same thing in possession to one which he or his progenitors have granted to another." (Townsend v Trustees of the Freeholders and Commonalty of the Town of Brookhaven, 97 AD 316 [2d Dept 1904].)

With a deed dated September 27, 1976 and recorded October 21, 1976, defendant City of [*2]New York transferred to plaintiff Washington Temple Church of God in Christ, Inc. title to real property designated on the tax map as Block 1212 Lot 4 (the "Subject Property.") The stated consideration for the transfer was $850.00.

With a deed dated March 22, 1977 and recorded June 16, 1977, the City of New York transferred title to the Subject Property to non-party Darrell A. Shavers. The stated consideration for the transfer was $250.00.

With deeds dated December 24, 2004 and January 7, 2005, both recorded April 1, 2005, the Estate of Darrell A. Shavers and Mr. Shavers's hiers transferred title to the Subject Property to defendant Global Properties and Associates, Inc. The stated consideration for the transfer was

$180,000.00.

With a deed dated June 1, 2005 and recorded June 13, 2005, Global Properties transferred title to the Subject Property to defendant Henry Spitzer. The stated consideration was $400,000.00. Mr. Spitzer's title was insured by third-party plaintiff Ticor Title Insurance Company.

In its Complaint filed September 27, 2005, Plaintiff alleges three "causes of action" designated "Action for Declaratory Judgment," "Temporary Restraining Order and Permanent Injunction," and "Legal Fees." In its cause of action for a declaratory judgment, which is immediately implicated on the pending motions, Plaintiff seeks a judgment "awarding . . . ownership of the [Subject] Property to Plaintiff . . . and . . . an order directing the New York City Office of the City Register to correct the public records." (Complaint, ¶ 28.) The prayer for relief is supported by a recitation of the transactional history of the Subject Property and the allegation that the City "wrongfully attempted to again transfer title to the [Subject] Property by improperly, and without authority, issuing a deed" to Mr. Shavers. (Complaint, ¶ 13.)

In its Answer, the City of New York essentially admits that it sold the Subject Property to Plaintiff in 1976, and then sold it again to Mr. Shavers in 1997. (See Answer of City of New York, ¶ ¶ 8, 10, 13.) Defendant Global Properties has asserted a cross-claim against the City, alleging that, if Global is found to be liable to Plaintiff, "such liability is the direct responsibility and incurred through the fault or acts" of the City, and that, if the sale of the Subject Property from Global to Spitzer is "found to be invalid, defendant The City of New York has been unjustly enriched." (See Global's Cross-Claims and Verified Reply to Spitzer's Cross-Claims, ¶ ¶ 19, 22.) Defendant Spitzer has also asserted a cross-claim against the City, and cross-claims against Global Properties; the allegations of the cross-claim against the City are virtually identical to the allegations of Global's cross-claim. (See Spitzer's Verified Answer with Affirmative Defenses and Cross-Claims, ¶ ¶ 24, 27.) In addition, Spitzer's title insurer, having satisfied a claim by its insured, instituted a third-party action against Spitzer's seller, Global Properties.

Now before the Court are six motions: Plaintiff moves for an order, pursuant to CPLR [*3]3212, granting summary judgement on its cause of action for declaratory relief, and moves for severance of Defendants' respective cross-claims; the City moves for an order, pursuant to CPLR 3212, granting summary judgment dismissing the cross-claims asserted against it by Global Properties and Spitzer; Global Properties moves for an order, among other things, pursuant to CPLR 3212, granting summary judgment against the City "on the issue of liability"; Global Properties moves for an order, pursuant to CPLR 3211 (a) (1) and (7), dismissing the third-party complaint of Ticor Title Insurance Company; and Ticor moves for leave to file an amended Complaint.

Plaintiff Washington Temple's Motion for Summary Judgment

Plaintiff's cause of action for declaratory judgement will be deemed based upon Article 15 of the Real Property Actions and Proceedings Law, which provides for an action to compel the determination of a claim to real property (see RPAPL § 1501 et seq), even though Plaintiff does not technically comply with the pleading requirements of the statute. (See Howard v Murray, 38 NY2d 695, 699-700 [1976]; Sunshine v Danbury, 181 AD2d 961, 963 [3d Dept 1992]; Knocklong Corp. v Long Island State Park Commission, 284 AD 973, 974 [2d Dept 1954]; Andrew v Lorrainey, 14 Misc 3d 1219 [A], 2007 NY Slip Op 50090 [U], * 6 [Sup Ct, Kings County].) "While an action under RPAPL Article 15 . . . is a statutory action, it has been described as a hybrid one in which the relief awarded is in large measure equitable in nature." (See Dowd v Ahr, 168 AD2d 763, 765 [3d Dept 1990], rev'd on other grounds 78 NY2d 469 [1991]; see also Lewis v Rodriguez, 155 Misc 2d 12, 13-15 [Sup Ct, Bronx County [1992].) Its equitable characteristics derive from the common law action to quiet title. (See, generally, 90 NY Jurisprudence 2d, § 509 et seq.)

As a threshold matter, Global Properties contends that "the Estate of Darrell Shavers, as the entity which obtained title in the Subject Property from defendant CITY, and thereafter transferred title in the Subject Property to defendant GLOBAL, is a necessary and indispensable party to this action." (See Global's Affirmation in Opposition to Plaintiff's Motion for Summary Judgment and in Support of Cross-Motion,¶ 29; see also CPLR 1001 [a].) Although Global is free to attempt to make the Estate a party to this action, Plaintiff need not do so. "Predecessors in title who claim no interest in the property are neither necessary nor proper parties to an action to quiet title." (McGahey v Topping, 255 AD2d 562, 563 [2d Dept 1998]; Brothers v Wall, 84 AD2d 923, 925 [4th Dept 1981]; see also Hitchcock v Abbott, 9 AD3d 563, 566 [3d Dept 2004].)

It is undisputed that the City's conveyance of the Subject Property to plaintiff Washington Temple was both made and properly recorded before the conveyance to Darrell A. Shavers was either made or recorded. Under New York's race-notice statute, "[w]hen two or more prospective purchasers contract for a certain property, . . . priority is given to the buyer whose conveyance or contract is first duly recorded." (See Avila v Arsada Corp., 34 AD3d 609, 610 [2d Dept 2006]; see also Real Property Law § § 291, 294; CPLR 6501; Transland Assets, Inc. v Davis, 29 AD3d 679, 679 [2d Dept 2006]; Jenkins-Watson v Golahi Holdings, LLC, 26 AD3d 467, 468 [2d Dept 2006]; Rivas v McDonnell, 308 AD2d 572, 573 [2d Dept 2003].) [*4]

No Defendant challenges this clear and fundamental proposition. Indeed, the City of New York "does not oppose plaintiff's summary judgement motion seeking a declaratory judgment declaring plaintiff owner of Brooklyn, Block 1212, Lot 4." (See Affirmation in Response to Washington Temple's Motion for Summary Judgement, ¶ 5.) Plaintiff is entitled, therefore, to the declaratory relief it seeks, unless there is some defense that would avoid Plaintiff's prima facie showing. Defendants Global Properties and Spitzer contend that the equitable doctrine of laches provides such a defense. Third-party plaintiff Ticor Title Insurance Company also opposes Plaintiff's motion on this ground, but it is not at all clear that it has standing to do so. In light of the Court's ruling on the laches defense, however, it is not necessary to resolve the question.

Defendants' laches defense is based upon evidence that Plaintiff became aware of the deed to Darrell A. Shavers in 1989 and its recordation, but took no action to address it. Plaintiff's files contain copies of letters to Plaintiff dated August 9, 1989 and October 2, 1989 from the City's Department of General Services, in which the City acknowledged its error in executing the deed to Mr. Shavers, advised Plaintiff that "the second deed to Mr. Shavers appears to be a nullity," and urged Plaintiff to consult its legal counsel "to determine the appropriate method for dealing with this issue." (See Exhibit P to Affirmation in Support of Plaintiff's Motion for Summary Judgment; Affidavit of Robert L. Madison, President and Pastor of Washington Temple, ¶ ¶ 33, 34.)

There is no evidence of any steps taken by Plaintiff to address the Shavers deed. The Subject Property is a vacant lot, and has been used for parking since it was acquired. (See id., ¶ ¶ 14, 19.) This action was prompted by the posting of a sign on the premises in February 2005, threatening that any vehicles parked there would be subject to tow. (See id., ¶ 25.) As stated by Plaintiff, "[i]t is undisputed that Plaintiff had unfettered access to the Property and was undisturbed in the use of the Property from and following its successful bid and purchase of the Property in 1976 through and including 2005, when this action was commenced, only a few months after Defendant Global made claim to ownership." (See Reply Affirmation in Further Support of Plaintiff's Motion for Summary Judgment,¶ 11.)

Plaintiff's cause of action for declaratory judgement is not barred by a statute of limitations. (See Orange & Rockland Utils. v Philwold Estates, 52 NY2d 253, 261 [1981]; Schoener v Lissaurer, 107 NY 111, 116-17 [1887]; Gold v New York State Business Group, Inc., 255 AD2d 628, 630

[3d Dept 1998]; Piedra v Vanover, 174 AD2d 191, 196 [2d Dept 1992].) "The cause of action [to remove clouds upon the title to land] is not the creation of the cloud, but its existence, its effect upon the title of the owner, and his right to have it removed." (Schoener v Lissauer, 107 NY at 117.) "That is a continuing right which endures as long as the occasion for its exercise." (Id.) "The requirement of prompt action is imposed as a policy matter upon persons who would challenge titleto property rather than those who seek to quiet title in their land." (Orange & Rockland Utils. v Philwold Estates, 52 NY2d at 261 [emphasis in original].) [*5]

This Court has found no authority that holds that the laches doctrine applies to an action to quiet title or to determine a claim to real property. The only authority cited in opposition to Plaintiff's motion, Delamater v Rybaltowski (161 AD2d 1001 [3d Dept 1990]), was an action to enforce restrictive covenants in a deed, and is inapposite. In Orange & Rockland Utils. v Philwold Estates (70 AD2d 338 [3d Dept 1979], mod. 52 NY2d 253 [1981]), an action for a declaration that a clause restricting the use of certain realty expired upon the death of the grantor, the Appellate Division "assum[ed] arguendo that laches [was] applicable to [the] action," but concluded that the doctrine was not applicable on the facts. (See id., 70 AD2d at 343.) The Court of Appeals agreed, "for the reason stated by the Appellate Division, that laches could not bar the action." (See id., 52 NY2d at 261-62.)

Here, too, assuming that the doctrine is applicable to an action like Plaintiff's for declaratory relief, it does not bar the relief on the uncontested facts. "[T]he defense of laches consists of an unreasonable delay by a plaintiff to the prejudice of the defendant." (Weiss v Mayflower Doughnut Corp., 1 NY2d 310, 318 [1956].) "But mere delay, however long, without the necessary elements to create an equitable estoppel, does not preclude the granting of equitable relief." (Id.; see also Kraker v Roll, 100 AD2d 424, 433 [2d Dept 1984].)

In turn, "the doctrine of equitable estoppel . . . should be applied with great caution when dealing with realty." (Huggins v Castle Estates, 36 NY2d 427, 427 [1975]; see also Lyon v Morgan, 143 NY 505, 509 [1894]; F.B. Transit Road Corp. v DRT Construction Corp., 241 AD2d 930, 931 [4th Dept 1997]; Kraker v Roll, 100 AD2d at 433.) The doctrine "should not be applied unless the grounds upon which it rests are clearly and satisfactorily established, and not then except in support of a clear equity or to prevent fraud." (Lyon v Morgan, 143 NY at 509.) Mere "inaction" does not constitute the "inequitable conduct" that would support a laches defense. (See Kraker v Roll, 100 AD2d at 435; see also Zaccaro v Congregation Tefereth Isreal of Forest Hills, 20 NY2d 77, 80 [1967] [delay not "unconscionable"].)

The Court cannot say here, assuming that laches may ever serve as a defense to a possessor's proceeding to quiet title, that Plaintiff's failure to seek that relief sooner is the kind of inequitable conduct that would warrant application of the doctrine. This conclusion is confirmed by a review of the "four elements" of laches, all of which "are necessary for the proper invocation of the doctrine." (See Cohen v Krantz, 227 AD2d 581, 582 [2d Dept 1996].)

"To establish laches, a party must show: (1) conduct by the offending party giving rise to the situation complained of, (2) delay by the complainant in asserting his or her claim for relief despite the opportunity to do so, (3) lack of knowledge or notice on the part of the offending party that the complainant would assert his or her claim for relief, and (4) injury or prejudice to the offending party in the event that relief is accorded the complainant." (Id.)

Defendants Global Properties and Spitzer (and his insurer Ticor) invoke the laches doctrine on the unarticulated and unsupported assumption that, for purposes of an action against them, the period of "delay" in taking action should be measured from the time Plaintiff became [*6]aware of a potential cloud on its title by reason of a conveyance to a non-party, Darrell A. Shavers. There can be no fair contention that Plaintiff did not act promptly in response to Global Properties's assertion of a right to possession of the Subject Property, or to Spitzer's subsequent putative purchase from Global. No authority is cited for the proposition that it would be inequitable to allow Plaintiff relief against them because it might have been inequitable to allow relief against Mr. Shavers if he had not sold it.

More importantly, however, neither Global Properties nor Spitzer can contend that it did not have notice that Plaintiff would not assert a claim to the Subject Property. "A purchaser of an interest in land . . . has no cause for complaint under the [recording] statute when its interest is upset as a result of a prior claim against the land the existence of which was apparent on the face of the public record at the time it was purchased." (Andy Assoc. v Bankers Trust Co., 49 NY2d 13, 20 [1979]; see also Trust Company of New Jersey v Genser, 271 AD2d 524, 526 [2d Dept 2000].) "[I]n counties using a block and lot' indexing system, a purchaser is charged with record notice of all matters indexed under the block and lot numbers corresponding to the purchaser's property, regardless of whether such information also appears in his or her direct chain of title." (Farrell v Sitaras, 22 AD3d 518, 520 [2d Dept 2005].) "Kings County . . . has used a block and lot' system since July 1, 1964." (Id.)

"If the purchaser fails to use due diligence in examining the title, he or she is chargeable, as a matter of law, with notice of the facts which a proper inquiry would have disclosed." (Fairmont Funding, Ltd. v Stefansky, 301 AD2d 562, 564 [2d Dept 2003]; see also Astoria Federal Savings & Loan Assoc. v June, 190 AD2d 644, 645 [2d Dept 1993].) Plaintiff's recorded deed provided notice that Plaintiff could assert a claim for relief against Defendants, so as to preclude a viable defense of laches. (See Stasson v Casini & Huang Construction, Inc., 241 AD2d 448, 448 [2d Dept 1997].)

Neither Global Properties, Spitzer, nor Ticor disputes Washington Temple's affidavit evidence that the Subject Property has been used as a parking lot from 1976, when it was acquired, until 2005, nor does anyone explain how that use could have escaped their attention as they proceeded with purchase transactions, respectively, of $180,000.00 and $400,000.00. "[A]ctual possession of land is sufficient notice to all the world of the existence of any right which the person so in possession is or may be able to establish." (Holland v Brown, 140 NY 344, 347 [1893]; see also Miles v DeSapio, 96 AD2d 970, 970 [3d Dept 1983]; Diamond v Wasserman, 8 AD2d 623, 624 [2d Dept 1959].)

It may be that Plaintiff would have been better advised to take action earlier to deal with the recorded Shavers deed, even though Mr. Shavers apparently made no claim to ownership or possession of the property. Under the circumstances presented, however, equity hardly demands, or even allows, that it be deprived of either legal title or full beneficial use of the Subject Property.

Plaintiff is entitled, therefore, to the declaratory relief requested. To the extent that [*7]Plaintiff's declaratory judgment cause of action and its motion for summary judgement seek an order directing the County Clerk "to correct the public records" (see Complaint, ¶ 28; Notice of Motion), it is not supported by any citation to authority. The Court notes, however, Real Property Law § 329, which provides for an action by an owner of real property "to have any recorded instrument in writing relating to such real property . . . declared void or invalid, or to have the same canceled of record as to said real property." Plaintiff has established prima facie that it is entitled to that relief, and Defendants have failed to raise an issue of fact with respect thereto. (See Mason v Stokes, 300 AD2d 370, 370-71 [2d Dept 2002].)

The City's and Global Properties's Respective Motions for Summary Judgement

Both defendant Global Properties and defendant Henry Spitzer have asserted cross-claims against the City that, generously interpreted, purport to allege causes of action for unjust enrichment and negligence. Global now moves "for partial summary judgment on the issue of liability" on its cross-claim, while the City moves for dismissal of Global's cross-claim, as well as Spitzer's, which is identical in terms. Spitzer has not opposed the City's motion, but third-party plaintiff Ticor as his subrogee has opposed. The Court will assume that Ticor has standing to do so, but, as will appear, it makes no difference.

Global's motion is easily disposed of. No mention is made of "unjust enrichment"; there is only a statement that "defendant CITY received consideration from both plaintiff and Darrell Shavers." (See Global's Affirmation in Opposition to Plaintiff's Motion for Summary Judgement and in Support of Cross-Motion, ¶ 38.) There are numerous allegations that the City was negligent in purporting to convey the same property twice, and in not correcting the problem when it was discovered; and that Global and its title insurer justifiably relied on the deed to Darrell A. Shavers in purchasing the Subject Property. (See id., at ¶ ¶ 35, 38, 41, 42, 43, 44.) Not a single authority is cited in support of a right to recovery on such allegations, and there is no affirmation or affidavit by a person with personal knowledge to provide the evidentiary foundation for any such recovery. In short, Global does not make a prima facie showing in its papers that it is entitled to judgment as a matter of law, nor, as will appear, does it do so in opposition to the City's motion.

The City's motion is supported by the affirmation and argument of its counsel and three affidavits: The affidavit of James Montefinise, Director of Research, Division of Real Estate Services, Department of Citiwide Administrative Services; the affidavit of Chi Chan, Principal Title Examiner in the Title Bureau of the Tax and Bankruptcy Litigation Division of the New York City Law Department; and James Cox, Chief of the Law Claims Division in the Office of the Comptroller of the City of New York.

With respect to the alleged claim for unjust enrichment, the City makes two arguments. First, "[t]he City did not receive funds from either Global or Spitzer at the times they received conveyances of the Property"; rather, "[t]he City received consideration from Washington Temple and Shavers, the parties to whom it conveyed the property in 1976 and 1977, [*8]respectively." (Affirmation in Support of the City's Motion and Cross-Motion for Summary Judgment and in Opposition to Global's Motion for Summary Judgment, ¶ 22.) Second, "the contracts of sale between Shavers and Global, and, Global and Spitzer preclude Global and Spitzer from recovery (sic) damages based on the doctrine of unjust enrichment." (Id., ¶ 23.)

Taking the second argument first, the City cites Goldman v Metropolitan Life Insurance Co.(5 NY3d 561 [2005]) for the proposition that, because (presumably) there were contracts of sale between Shavers and Global, and between Global and Spitzer, Defendants can assert no claim for unjust enrichment against the City. Specifically, the Court of Appeals in Goldman quoted an earlier decision stating that "[t]he existence of a valid and enforceable written contract governing the particular subject matter ordinarily precludes recovery in quasi contract for events arising out of the same subject matter." (Id., at 572 [quoting Clark-Fitzpatrick, Inc. v Long Is. R.R. Co., 70 NY2d 382, 388 (1987)].)

The City provides no evidence that Shavers and Global, and then Global and Spitzer, were parties to a "valid and enforceable written contract governing the particular subject matter" (id.), and points to nothing in the parties' pleadings or other papers to support the existence of such contracts. Assuming, however, the existence of such contracts, the cited authorities might preclude an unjust enrichment claim between the parties to the respective contracts, but neither those authorities, nor any other cited by the City, address the viability of the claim against someone not a party to the contract, here the City.

An absence of such authority may, however, suggest legitimacy to the City's first argument, that a claim for unjust enrichment does not lie when the party allegedly enriched has received nothing from the claimant. Here the City relies on the Court of Appeals's often-cited opinion in Miller v Schlos (218 NY 400 [1916].) Specifically, "if one man has obtained money from another, through the medium of oppression, imposition, extortion, or deceit, or by the commission of a trespass, such money may be recovered back, for the law implies a promise from the wrongdoer to restore it to the rightful owner." (Id., at 408 [emphasis in original].) "It is an obligation which the law creates . . . when and because the acts of the parties or others have placed in the possession of one person money, or its equivalent, under such circumstances that in equity and good conscience he ought not to retain it, and which ex oequo et bono belongs to another." (Id., at 407.)

The City's contention is simple: if it was unjustly enriched by the conveyance to Shavers, it came at the expense of Shavers, and not Global Properties or Spitzer. The contention is consistent with the principle that "an injured party who has not conferred a benefit may not obtain restitution." (See Farash v Sykes Datatronics, Inc., 59 NY2d 500, 504 [1983].) Global contends in response only that, by reason of the deed it received from Shavers's estate and hiers, it has succeeded to any claim Shavers might have had against the City. (See Global's Affirmation in Opposition to the City's Motion and Cross-Motion for Summary Judgment and Reply to the City's Opposition to Global's Cross-Motion for Summary Judgment, ¶ ¶ 9, 10.) But Global provides no factual or legal support for its contention, and neither Spitzer nor Ticor as its [*9]subrogee makes any showing in opposition to the City on this issue. Nor do any of these parties address the rather obvious circumstance that, if the City was enriched by its conveyance to Shavers, unjustly or not, it was in the amount of the $250.00 consideration.

The City also argues that it owed no duty to Global Properties or Spitzer that was breached when it "sold" the Subject Property to Shavers, and that any loss suffered by Global or Spitzer was the consequence of a lack of diligence in searching the public record, which would have revealed the deed to Plaintiff. On the duty point, the City relies on general negligence cases in which recovery was sought for economic loss (see 532 Madison Ave. Gourmet Foods v Finlandia Ctr., 96 NY2d 280 [2001]; Bernstein v L. & H. Meat Co., Inc., 115 NYS2d 175 [Sup Ct, New York County 1951], aff'd 280 AD 914 [1st Dept 1952]), as well as those styled actions for negligent misrepresentation (see Ossining Union Free School Dist. v Anderson LaRocca Anderson, 73 NY2d 417 [1989]; Calamari v Grace, 98 AD2d 74 [2d Dept 1983].)

The central message of these and many other authorities is that no duty of care is owed, such as to allow recovery for economic loss, unless "the underlying relationship between the parties be one of contract or the bond between them so close as to be the functional equivalent of privity." (See Ossining Union Free School Dist. v Anderson LaRocca Anderson, 73 NY2d at 419; see also 532 Madison Ave. Gourmet Foods v Finlandia Ctr., 96 NY2d at 289-90; Sabo v Alan B. Brill, P.C., 25 AD3d 420, 421 [1st Dept 2006]; Chambers v Executive Mortgage Corp., 229 AD2d 416, 417

[2d Dept 1996]; Calamari v Grace, 98 AD2d at 77-82.)

In the negligent misrepresentation context, the relationship akin to privity has been described by the following characteristics: "(1) an awareness by the maker of the statement that it is to be used for a particular purpose; (2) reliance by a known party on the statement in furtherance of that purpose; and (3) some conduct by the maker of the statement linking it to the relying party and evincing its understanding of that reliance." (See Prudential Ins. Co. v Dewey, Ballantine, Bushby, Palmer & Wood, 80 NY2d 377, 384 [1992]; see also Parrott v Coopers & Lybrand, L.L.P., 95 NY2d 479, 484 [2000].)

The City probably makes a prima facie showing on the duty issue, although it does not specifically address the characteristics of a privity-like relationship in the context of this case, nor does it address the more general factors considered by courts in determining the existence of duty (see 532 Madison Ave. Gourmet Foods v Finlandia Ctr., 96 NY2d at 288-89.) Neither Global Properties, Spitzer, nor Ticor as Spitzer's subrogee, makes any showing that the City owed a duty of care to any of them. Assertions and arguments that the City could have and should have done more to correct its error after it was discovered, although relevant to assessing whether there was a lack of due care, do not establish the duty to exercise due care for the party's benefit.

The Court is reluctant, however, on this record to suggest that negligence in connection with the recording of deeds and other instruments affecting real property can never lead to liability to those who justifiably rely on the recordation system. It is not at all clear that a [*10]determination of duty in that context will "expos[e] defendants to unlimited liability to an indeterminate class of persons" (see id, at 289), or will create liability "vast and unbounded, wholly disproportionate to the defendant's undertaking or wrongdoing" (see Ossining Union Free School Dist. v Anderson LaRocca Anderson, 73 NY2d at 421.)

The Court concludes instead that there can be no recovery here by Global Properties, Spitzer, or Ticor, because a diligent search of the public record would have revealed the successive deeds to Plaintiff and Shavers, without an intervening conveyance from Plaintiff to the City. At the least, any diligent searcher would have been put to a duty to investigate whether Shavers's estate and hiers held any interest in the Subject Property to convey. Whether considered the absence of proximate cause on a general negligence claim, or the absence of "reasonable reliance" on a negligent representation claim (see J.A.O. Acquisition Corp. v Stavitski, 8 NY3d 144, 148 [2007]), the result is the same. Ticor's contention that there was no obligation to search or investigate outside the chain of title (see Affirmation of Andrew Paul Cooper, Esq. in Opposition to Motion of Washington Temple Church of God in Christ, Inc. and Motion and Cross-Motion of the City of New York for Summary Judgment, ¶ ¶ 54-56) does not reflect the controlling law, as is demonstrated above in the context of the laches defense.

Global Properties's Motion to Dismiss the Third-Party Complaint and Ticor Title's Motion for Leave to File an Amended Complaint

Third-party defendant Global Properties moves pre-answer to dismiss the third-party complaint of Ticor Title Insurance Company a/s/o Henry Spitzer pursuant to CPLR 3211 (a)(1), contending that it has "a defense . . . founded upon documentary evidence," and pursuant to CPLR 3211 (a)(7), contending that "the pleading fails to state a cause of action."

Global fails to attach a copy of the pleading that it seeks to have dismissed, and its motion must be denied for that reason alone. The Court notes, however, that the third-party action arises out of facts and circumstances that must be characterized as at least unusual, involving a recorded title that provided Global, Spitzer, and Ticor with constructive notice that any interest Global or Spitzer might claim in the Subject Property derived from someone who was not the owner, as well as open and obvious possession of the Subject Property by the owner at all times during the transactional history. The Court reminds Global that, in order that a motion to dismiss be granted pursuant to CPLR 3211 (a)(1), the "documentary evidence submitted [must] conclusively establish

[ ] a defense to the asserted claims as a matter of law" (see Beal Savings Bank v Sommer, 8 NY3d 318, 324 [2007] [internal quotation marks and citations omitted]); and that, when assessing a complaint in light of CPLR 3211 (a)(7), the court must give the pleading a "liberal construction" and the plaintiff "the benefit of every possible favorable inference" (see AG Capital Funding Partners, L.P. v State St. Bank & Trust Co., 5 NY3d 582, 591 [2005].)

Third-party plaintiff Ticor seeks leave to file and serve an amended complaint that would allege a cause of action for "Rescission" in addition to causes of action alleged for "Breach of [*11]Contract," "Breach of Covenant," "Breach of Warranty," and "Unjust Enrichment." "Leave to amend or supplement pleadings should be freely granted unless the amendment sought is palpably improper or insufficient as a matter of law, or unless prejudice and surprise directly result from the delay in seeking the amendment." (Maloney Carpentry, Inc. v Budnik, 37 AD3d 558, 558 [2d Dept 2007].) Global has not shown that any basis exists to deny Ticor leave, particularly when no answer has yet been made to the third-party complaint.

Although styled a "third-party complaint," Ticor's complaint against Global Properties does not constitute "third-party practice" as described in CPLR 1007. Ticor is not a "defendant" in the main action (although its subrogor Spitzer is); it is not proceeding "against a person not a party," since Global is a party; and Ticor is not claiming that Global "is or may be liable" to it "for all or part of the plaintiff's claim" against it. (See CPLR 1007.) Even as a third-party action, the Court could dismiss it without prejudice, or sever it from the main action. (See CPLR 1010.)

In a consent order dated January 17, 2007, all of the parties agreed that Ticor could intervene in the main action (see CPLR 1012 et seq.) "Once let in, the intervenor becomes a party for all purposes." (Kruger v Bloomberg, 1 Misc 3d 192, 195 [Sup Ct, New York County 2003] [quoting Siegel, NY Prac § 178, at 295 (3d ed)].) Specifically, Ticor could assert a cross-claim against Global for recovery of the amount it paid its insured/subrogor, even though that amount does not represent "all or part of a claim asserted in the action against" Ticor. (See CPLR 3019 [b].)

It may be that the order allowing Ticor to intervene was not appropriate, even on consent of all the parties, because the Court was not then presented with " a proposed pleading setting forth the claim or defense" that Ticor wished to assert. (See CPLR 1014; see also Farfan v Rivera, 33 AD3d 755 [2d Dept 2006]; Matter of Carnegie Hill v Lane, 20 AD2d 914 [2d Dept 1964].) As previously noted, Ticor's participation on the pending motions has not prejudiced the results on the Plaintiff's motion or Global's and the City's respective motions against the other. As between Global and Ticor, Global did not answer Ticor's complaint, and its time will run anew to respond to the amended complaint. The question becomes, however, particularly in light of the determinations on these motions, whether that claim should proceed apart from the remaining claims in Plaintiff's action.

Plaintiff's Motion to Sever

Plaintiff moves for an order "directing the severance of [its] motion for summary judgment and its claims from both the cross-claims of the Defendants and the third-party action." (Notice of Motion to Sever Cross-Claims and Third-Party Action.) Plaintiff's motion must be granted to the extent of allowing Plaintiff to enter judgment on its cause of action to quiet title to the Subject Property. There is nothing to be gained, and only confusion or worse to result, by withholding that relief from Plaintiff until the remaining claims are resolved.

Plaintiff has alleged a second cause of action, denominated "Temporary Restraining [*12]Order and Permanent Injunction" that appears to be asserted only against Global Properties and Spitzer; and a third cause of action, denominated "Legal Fees," that appears to be asserted against all Defendants, including the City. Plaintiff has not articulated the legal theories underlying these respective claims, nor shown how the factual and legal issues will differ from those that will arise on the remaining claims between other parties. In short, Plaintiff has not shown how severance will "further[ ] . . . convenience or . . . avoid prejudice." (See CPLR 603.)

The Court's determinations on the pending motions have certainly narrowed the matters yet to be litigated. But, other than by speculation, the Court cannot know how considerations of convenience or prejudice would be affected by severance. Factors such as the preservation or "waste" of judicial resources, the "risk of inconsistent verdicts," "common nucleus of facts," and the same or different witnesses (see Williams v Property Services, LLC, 6 AD3d 255, 256 [1st Dept 2004]) cannot be assessed on the basis of only scant and conclusory allegations in a complaint.

Plaintiff's motion for severance (motion calendar no. 23) is GRANTED only to the extent that the First Cause of Action alleged in the complaint, denominated "Action for Declaratory Judgment," is severed from the Complaint and from any remaining cross-claim and third-party action;

Plaintiff's motion for summary judgment on its cause of action for declaratory and related relief (motion calendar no. 20) is GRANTED; Plaintiff shall settle an order and judgment in accordance with Uniform Rule § 202.48 (see CPLR 5012);

The City's motion and cross-motion for summary judgment dismissing the cross-claims of Global Properties and Henry Spitzer (motion calendar no. 21) are GRANTED;

Global Properties's motion for summary judgment "on the issue of liability" against the City (motion calendar no. 22) is DENIED;

Global Properties's motion to dismiss the third-party complaint of Ticor Title (motion calendar no. 24) is DENIED; and

Ticor Title's motion for leave to file an amended Complaint (motion calendar no. 25) is GRANTED; the First Amended Third Party Complaint attached as Exhibit L to the Affirmation in Support of Ticor's Motion, shall be served on Global Properties in accordance with CPLR 2103 (b), together with a copy of this order with notice of entry, and Global shall answer within 20 days after service.

May 31, 2007___________________

Jack M. Battaglia [*13]

Justice, Supreme Court