Oparaji v New York Mtge. Co., LLC

[*1] Oparaji v New York Mtge. Co., LLC 2007 NY Slip Op 52617(U) [24 Misc 3d 1230(A)] Decided on October 22, 2007 Supreme Court, Bronx County Manzanet-Daniels, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 October 22, 2007
Supreme Court, Bronx County

Maurice Oparaji, Plaintiff,

against

The New York Mortgage Company, LLC, Defendant.



1180/2006



Maurice Oparaji, plaintiff pro se

Attorney/Firm for Defendant:

Tarter, Krinsky & Drogin, LLP

1350 Broadway - 11th Floor

New York, NY 10018

Sallie Manzanet-Daniels, J.

Plaintiffs motion and defendant's cross-motion for summary judgment are consolidated for purposes of this decision. For the reasons set forth herein, plaintiffs motion is denied and defendant's cross-motion is granted.

Plaintiff brought the instant action alleging that defendant The New York Mortgage Company, LLC ("NYMC") violated the Fair Housing Act, the Equal Credit Opportunity Act and Title II of the Civil Rights Act of 1964 in denying his application for a mortgage. Plaintiff claims that he was denied a residential mortgage loan by defendant for a residential property because of his African-American race and because the property is located in Bronx, New York, a neighborhood predominately of African-American and Hispanic residents. In February, 2004, plaintiff applied to NYMC for a residential loan in the amount of $205,200 for a property located at 2194 Washington Avenue, Bronx, New York. In connection with plaintiff's loan application, an appraisal of the premises was performed by an independent appraiser. Pursuant to the [*2]appraisal report dated February 13, 2004, "the floors, kitchens and bathrooms utilities and windows are absent. As per the real estate broker, the subject dwelling is being sold as is." NYMC contends that after receiving the appraisal report, it denied plaintiffs application because the aforementioned conditions did not meet the requisite Fannie Mae guidelines for underwriting residential mortgage loans as the premises, which was to be sold "as is", was not habitable. NYMC further contends that both the Fannie Mae Selling Guide and the HUD handbook on acceptable properties require a property securing a residential mortgage loan to be in habitable condition. The Fannie Mae Selling Guide states that "[f]or existing construction, an appraisal may be based on an 'as is' condition of the property if minor conditions that do not affect the livability of the property exist - such as deferred maintenance... The lender must review carefully the appraisal for a property appraised on an 'as is' condition to assure that the property does not have any physical deficiencies or conditions that would affect its livability."

NYMC argues that its decision to deny plaintiffs loan application rested on a sound business decision, and that the evidence submitted indicates that its denial was not based on plaintiffs race or the location of the premises. NYMC also points out that prior to the commencement of this action, plaintiff filed a claim with the New York State Division of Human Rights which conducted an investigation and found plaintiffs claim of discrimination to have no basis. Indeed, in its Determination and Order After Investigation dated on or about October 5, 2004, the State Division of Human Rights determined that:

...there is NO PROBABLE CAUSE to believe that the respondent has engaged in or is engaging in the unlawful discriminatory practice complained of...

The evidence... revealed that the denial of the residential mortgage... was due to the premises not meeting Guidelines which in parts states that the premises had to be livable. According to the certified appraiser's report, the subject dwelling was in fair condition. However, the report noted that the floors, the kitchens and bathrooms utilities and windows were all absent. As such, the subject premises does not comply with Fannie Mac's Guidelines for existing construction.

The Division notes that in complaint's rebuttal he refers to a statement that his broker wrote where she stated in part "I do not understand this since the property appraised unless they don't give mortgages in the area" to support his allegation of discrimination. However, based on a telephone conversation with the broker, she indicated that she wrote the statement because it was the complainant's "sentiments" and not hers She further stated that she does not believe that respondents discriminated against her client.

The evidence in the Division record shows that Respondent has processed and closed on loans from African Americans whose properties were located in the Bronx.

The court's function on this motion for summary judgment is issue finding rather than issue determination. Sillman v. Twentieth Century Fox Film Corp., 3 NY2d 395 (1957). Since summary judgment is a drastic remedy, it should not be granted where there is any doubt as to the existence of a triable issue. Rotuba Extruders v. Ceppos, 46 NY2d 223 (1978). The movant must come forward with evidentiary proof in admissible form sufficient to direct judgment in its favor [*3]as a matter of law. Zuckerman v. City of New York, 49 NY2d 557, 562 (1980). Thus, when the existence of an issue of fact is even arguable or debatable, summary judgment should be denied. Stone v. Goodson, 8 NY2d 8, (1960); Sillman v. Twentieth Century Fox Film Corp., supra .

The proponent of a notion for summary judgment carries the initial burden of production of evidence as well as the burden of persuasion. Alvarez v. Prospect Hospital, 63 NY2d 320 (1986). Thus, the moving party must tender sufficient evidence to demonstrate as a matter of law the absence of a material issue of fact. Once that initial burden has been satisfied, the "burden of production" (not the burden of persuasion) shifts to the opponent, who must now go forward and produce sufficient evidence in admissible form to establish the existence of a triable issue of fact. The burden of persuasion, however, always remains where it began, i.e., with the proponent of the issue. Thus, if evidence is equally balanced, the movant has failed to meet its burden. 300 East 34th Street Co. v. Habeeb, 248 AD2d 50 (1st Dept. 1997).

42 U.S.C. §3605 provides, in pertinent part:

(a) In general

It shall be unlawful for any person or other entity whose business includes engaging in residential real estate-related transactions to discriminate against any person in making available such a transaction, or in terms or conditions of such a transaction, because of race, color, religion, sex, handicap, familial status, or national origin.

(b) "Residential real estate-related transaction" defined

As used in this section, the term "residential real estate-related transaction" means any of the following:

(1) The making or purchasing of loans or providing other financial assistance-

(A) for purchasing, constructing, improving, repairing, or maintaining a dwelling; or

(B) secured by residential real estate.

To state a prima facie case of discrimination pursuant to this statute, plaintiff must allege that he is a member of a protected class; he applied for and was qualified for a loan; the loan was rejected despite the plaintiff's qualifications; and, the defendants continued to approve loans for applicants with qualifications similar to those of the plaintiff. See, Frison v. Ryan Homes, 2004 WL 3327904, aff'd, 151 F.3d 712; Latimore v. Citibank. F.S.B., 979 F. Supp. 662,665; Equicredit Corp. of NY v. Turcios,300 AD2d 344 (2d Dept. 2002).

In support of his motion, plaintiff submits documents purporting to show that the premises were sold to "Phillip Whitson" in August 2004. However, this purported evidence is irrelevant because Mr. Whitson apparently obtained a mortgage loan from a different lender. In addition, plaintiffs allegation presented in his affidavit, i.e., that defendant's representative told him "everything seems to be okay, your credit is fine, your assets are fine, but I doubt if you will be approved... because since I have been with the Company, I have not seen it happen that a minority will be approved in a minority neighborhood, but let's try" is an inadmissible hearsay allegation and, therefore, incompetent evidence to create and issue of fact. Thompson v. Abbasi, 15 AD3d 95 (1st Dept. 2005). Plaintiff fails to offer an affidavit from "Mr. Jean Lahens" who [*4]purportedly made this statement. The same is true of plaintiffs Broker's purported statement that "[t]he only response I am getting from Bank is 'Unacceptable Collateral. I don't understand this since the property appraised unless they don't give mortgages in the area." This statement was clarified by the Human Rights Division when they spoke with the Broker, who stated that the statement reflected plaintiffs belief, and not the Broker's. Thus, the only proof submitted by plaintiff are hearsay statements. Hearsay evidence is permissible in opposition to a summary judgment motion as long as it is not the only proof submitted Guzman v M.P. Really Corp., 262 AD2d 99 (1st Dept. 1999). Here, it is the only evidence submitted by plaintiff.

In addition, plaintiff entirely fails to show that he qualified for the loan. The Guidelines followed by defendant clearly required the premises to be habitable, which it was not. The uncontroverted documentary evidence demonstrates that defendant had a legitimate, non-discriminatory reason for the denial of the loan. Moreover, defendant presented evidence, as found by the Human Rights Division, that it had approved mortgage loans of African-American borrowers in the Bronx.

Accordingly, plaintiffs motion for summary judgment is denied and defendant's cross-motion for summary judgment is granted. Plaintiff's complaint is dismissed.

This constitutes the decision and order of this Court.

Dated: October 22, 2007

Hon. Sallie Manzanet-Daniels