Libertypointe Bank v 7 Waterfront Prop. LLC

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[*1] Libertypointe Bank v 7 Waterfront Prop. LLC 2010 NY Slip Op 52308(U) [30 Misc 3d 1206(A)] Decided on December 30, 2010 Supreme Court, Richmond County Minardo, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law ยง 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on December 30, 2010
Supreme Court, Richmond County

Libertypointe Bank, Plaintiff


7 Waterfront Property LLC, YEHUDA LEIB PURETZ a/k/a LEIB PURETZ, and BRIDGEPORT TOWERS LLC, Defendants.


Attorneys for plaintiff:

Sankel Skurman & McCartin LLP

750 Third Avenue

New York, NY 10017

Attorneys for defendant

7 Waterfront Property LLC

Mark D. Mermel, Esq.

98 Cuttermill Road, Suite 234

Great Neck, NY 11021

Philip G. Minardo, J.

Plaintiff's motion for summary judgment against the remaining defendants Yehuda Leib Puretz a/k/a Leib Puretz (hereinafter "Puretz") and Bridgeport Towers, LLC (hereinafter "Bridgeport") (No. 3037) is denied, and the cross motion (No. 3374) of said defendants for dismissal of the complaint pursuant to CPLR 3211(a)(7) is granted.

This matter arises out of plaintiff's attempt to foreclose a commercial mortgage against the non-moving defendant, 7 Waterfront Property, LLC (hereinafter "mortgagor"), relative to certain real property located at 7 Bank Street, Staten Island, New York. Plaintiff's Summons, Verified Complaint, and Notice of Pendency (see Plaintiff's Exhibit A) were filed with the Richmond County Clerk on July 21, 2009. This Court previously granted plaintiff's motion for summary judgment as against the mortgagor and on May 21, 2010, signed an order appointing a referee (see Plaintiff's [*2]Exhibit I). [FN1]

In moving for a "judgment on liability" against Puretz and Bridgeport, plaintiff claims that they each "personally guaranteed" payment of the mortgagor's obligations under the subject note (see Plaintiff's Exhibits G and H). In addition, plaintiff seeks orders striking the affirmative defenses of Puretz and Bridgeport, as well as allowing the substitution of "VNB New York Corp.," as plaintiff, in the place and stead of "LibertyPointe Bank".

As previously indicated, plaintiff's motion for partial summary judgment is denied, and defendants' cross motion for dismissal of the complaint based, inter alia, on plaintiff's failure to state a cause of action against them is granted.

It is axiomatic that the moving party on a motion for summary judgment bears the initial burden of making a prima facie showing of entitlement to judgment as a matter of law (Alvarez v. Prospect Hosp., 68 NY2d 320; Northwest Bank Minnesota, N.A., v. Sabloff, 297 AD2d 722; Katona v. Low, 226 AD2d 433). Indeed, the burden of demonstrating a triable issue of fact does not shift to the non-moving party until the movant has demonstrated a prima facie entitlement to summary judgment (see Nassau Trust Co. v. Montrose Concrete Prods. Corp., 56 NY2d 175). In the opinion of this Court, plaintiff has failed to meet its initial burden.

The complaint sub judice makes no allegation against either Puretz or Bridgeport other than alleging that they are guarantors of the underlying note and mortgage. More particularly, it is alleged in paragraph 9 that "on or about August 15, 2006 defendant Puretz executed and delivered to plaintiff an unconditional guaranty of the payment when due of the indebtedness of Mortgagor to plaintiff as evidenced by the Note and Mortgage," and in paragraph 10 that "on or about March 30, 2009 defendant Bridgeport executed and delivered to plaintiff an unconditional guaranty of the payment when due of the indebtedness of Mortgagor to plaintiff [as] evidenced by the Note and Mortgage" (Plaintiff's Exhibit A). There is no claim that the alleged guarantors defaulted under their guarantees or that plaintiff was the owner and holder of the guaranties at the time the action was commenced. To the contrary, it merely alleges (in paragraph 12) that plaintiff "is the owner and holder of the [subject] Note and Mortgage."[FN2] In this regard, while the reply affidavit submitted on [*3]behalf of plaintiff attempts to shift the burden of proof onto the cross-moving defendants by asserting that "at no point do [they]...deny that...they have defaulted in performing their obligations under the guaranty agreement" (see Reply Affidavit, para 8), their failure to do so is wholly irrelevant in the absence of any allegation of a default in the complaint itself. Thus, the complaint fails to state a cause of action against these defendants.

Finally, even if plaintiff had met its burden of proof on the motion, the October 6, 2010 affirmation of Martin Kirzner submitted on behalf of Bridgeport states that he is the only person authorized to execute documents on behalf of said defendant. Unchallenged, this affidavit is sufficient to raise a triable issue as to the power of defendant Puretz to sign the guaranty purporting to bind Bridgeport. As to Puretz, his affirmation dated October 7, 2010 states, inter alia, that he was only sent the signature page of the guaranty and signed it merely as a favor to Meir Eichler, a former officer of plaintiff. This affidavit, also unchallenged, is likewise sufficient to raise a triable issue as to the signor's intent to be held personally liable as a guarantor, particularly in light of the allegation that it was only signed to accommodate the wishes of a then-officer of plaintiff LibertyPointe Bank.

Summary judgment should not be granted where there is any doubt as to the existence of a triable issue or where the existence of such an issue is arguable (American Home Assur Co., v. Amerford Intl. Corp., 200 AD2d 472).

Accordingly, it is

ORDERED, that plaintiff's motion is denied, and it is further

ORDERED, that the cross motion for dismissal of the complaint as against Yehuda Leib Puretz, a/k/a Leib Puretz, and Bridgeport Towers LLC is granted, and it is further

ORDERED, that the action as to said defendants is severed and dismissed, and it is further

ORDERED, that the Clerk enter judgment accordingly.

E N T E R,

Dated:December 30, 2010S/ Philip G. Minardo

J. S. C. Footnotes

Footnote 1:The original, August 15, 2006 "Note" (providing a "Final Maturity Date" of August 1, 2008) and "Mortgage, Assignment of Rents and Security Agreement" between Plaintiff and mortgagor are attached as Plaintiff's Exhibits C and D respectively. The August 1, 2008 "Note Modification Restatement and Extension Agreement" extending the maturity date to November 1, 2008 is attached as Plaintiff's Exhibit E. The February 1, 2009 "Mortgage Modification and Extension Agreement" providing for an August 1, 2014 "Maturity Date" is attached as Plaintiff's Exhibit F.

Footnote 2:Plaintiff LibertyPointe Bank, the owner and holder of the note, mortgage and guaranty agreements at the time of commencement of the action (see Plaintiff's Exhibit A), was closed by the FDIC on or about March 11, 2010, at which time the FDIC acting as Receiver for LibertyPointe sold and assigned all of its loans, including this note, mortgage and guaranty to Valley National Bank. The assignment provides, in relevant part, that the subject mortgage was assigned first to Valley National Bank and then to VNB New York Corp. "Together with the bonds or notes or obligations or guaranty agreements" (see Plaintiff's Exhibits M, N [emphasis added]).

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