Chi Lo Liu v Radmin
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Chi Lo Liu v Radmin 2011 NY Slip Op 32717(U) October 17, 2011 Supreme Court, Nassau County Docket Number: 9022-09 Judge: Timothy S. Driscoll Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. ........................... ....... ......... .. [* 1] SUPREME COURT- STATE OF NEW YORK SHORT FORM ORDER Present: HON. TIMOTHY S. DRISCOLL Justice Supreme Court CHI LO LIU and HUAG SU YING LIU, Plaintiffs, - against - JOEL RADMIN, MICHAEL LANGONE EXTREME REALTY, LLC, REFSNART CORP., JAMES V. GUARINO, DAVID GALANTER, ESQ., JG CAPITAL, LLC, and JASON AU, Index No. 9022- Motion Seq. No. Submitted 9/16/11 Defendants. Papers Read on this Motion: Notice of Motion, Attorney Affirmation and Exhibits................... Memorandum of Law in Support....................................................... Affirma tio n in Op pos iti 0 D...... ..... ............ Reply Affirmation in Further Support..................................... This matter is before the cour on the motion filed by Plaintiffs Chi Lo Uu and Huag Su Ying Uu on August 16 2011 and submitted on September 16 2011. For the reasons set forth below, the Cour denies the motion. BACKGROUND A. Relief Sought Plaintiffs move for an Order , pursuant to CPLR 3025(b), granting them leave to serve an Amended Complaint. Defendants oppose Plaintiffs ' motion. B. The Paries ' The paries ' History history is set forth in detail in a prior Order of the Cour dated July 1 2010 Prior Order ). As noted in the Prior Order, the Complaint alleges as follows: [* 2] In or about Januar of2006 , Plaintiffs retained Defendants Extreme Realty and Langone a representative of Extreme Realty, to perform real estate broker services on behalf of Plaintiffs in connection with the marketing and sale of mixed-use real estate located at 242 East 40th Street New York , New York 10016. In or about Januar of 2006 , Langone and Extreme advised Plaintiffs that they had received an offer to purchase the Building " at the highest market price 4). Langone and Extreme introduced Plaintiffs to Defendant Radmin and his (Compl. at holding company Defendant Refsnar. These paries agreed to the milion. On or about Februar 1 , sale of the Building for $1.85 2006 , Defendant Galanter "proffered" (Compl. at 19) a real estate contract in connection with this transaction. Plaintiffs allege that Radmin disregarded corporate formalities with respect to Refsnar to such an extent that Refsnar was simply a conduit through which Radminconducted his personal business. Guarino was a principal of Extreme Realty and JG , a financing broker. Au , Radmin and Guarno owned and operated JG. In connection with the Sale , Langone , Radmin , Extreme and Guarino aranged to purchase the Building " as a saleable valuable assignment, marketing the tIansaction as a ' flip contract''' (Compl at 24). The closing on the Sale took place on or about May 10 , 2006. The attendees at the Closing were Plaintiffs and principals of an entity known as Grand Central 888 Inc. (" Grand Central" ), to whom Radmin , Guarino , LangQne and Extreme had assigned their rights under the contract. Grand Central purchased the Building with financing aranged by Guarino , JG and Au. Plaintiffs then leared that Grand Central paid a total of$2. 6 milion to purchase the Building, which was $750 000 more than the $1.85 milion price to which Plaintiffs agreed. Grand Central paid this additional $750 000 to Radmin, Guarino , Langone and Extreme as commissions and other fees. Plaintiffs submit that they are entitled to this $750 000. Plaintiffs outline the allegedly improper conduct of the Defendants in connection with the Sale , including their failure to disclose to Plaintiffs their relationship to each other and interest in the Sale , which Plaintiffs submit constituted a material representation. The Complaint contains five (5) causes of action: 1) faithless service: broker fraud , 2) breach of fiduciar duty, 3) fraud , 4) deceptive trade practices , for which Plaintiffs seek damages pursuant to General Business Law (" GBL" ) ~ 349 and 5) conversion and prima facie tort. ," [* 3] Plaintiffs now seek to amend the Complaint to assert additional causes of action against Radmin and Langone for violations of New York Real Property Law ("RPL") ~ ~ 440-a and 442-a which , Plaintiffs maintain have only recently become apparent to Plaintiffs in light of the timing of Defendants ' submissions " (Blodnick Aff. in Supp. at ~ 4). I Specifically,. Plaintiffs maintain that , upon reviewing Radmin s deposition testimony and his affidavit submitted in connection with Defendants ' pending sumar judgment motion , Plaintiffs realized that Langone was not a licensed real estate salesperson while employed at Extreme and while working under the direct supervision of Radmin. Plaintiffs submit that this information forms the predicate for their additional proposed causes of action pursuant to RPL ~~440-a and 442-a. C. The Paries Positions Plaintiffs argue that, while employed at Extreme and under Radmin s direction , Langone held himself out to be a real estate broker and/or salesman when soliciting their business when he was not properly licensed. They cite Langone s deposition testimony (Ex. C to Blodnick Aff. in Supp. ) which , they submit , establishes that 1) while employed at Extreme and under Radmin direction , Langone held himself out as a real estate broker and/or real estate salesman, when soliciting Plaintiffs; and 2) Langone improperly solicited a commission. Defendants submit that the Cour should deny Plaintiffs ' motion on the basis that it is untimely. Defendants contend , fuher, that the proposed amendment lacks merit. Defendants argue that while Plaintiffs " vaguely note " that Langone and Radmin received proceeds from the underlying real estate transaction (Clarke Aff. in Opp. at ~ 18), they do not allege that the proceeds were a cOlIission , or that they paid them. Langone testified that he was paid by his Employer, Extreme , in connection with the underlying real estate transaction (Tr. at pp. 19outlned infra). And Plaintiff Chi Lo Liu admitted that he did not pay Langone a commission, as reflected by Liu s deposition testimony (Ex. D to Blodnck Aff. in Supp. ) regarding a meeting concernng the transaction at issue: I Also pending before the Cour are 1) Defendants ' motion to strike the Note ofIssue or , alternatively, permit postNote of Issue discovery and 2) Defendants ' motion for sumar judgment dismissing the Complaint. [* 4] Q: What was the result of this meeting? A: We came to the conclusion to accept an offer of one point eight- five millon , but I wil not give out commission to Michael. Q: Did Michael protest the decision to not pay him his commission? A: Well , originally I was supposed to get one point nine milion, but because I agreed to take the one point eight- five millon so I told him that you can get the rest of the fift thousand as your commission. Q: That was not responsive to my question. My question was , did Michael protest when you told him you weren t going to give him his commission? A: Yes , but I didn t agree with him. Liu Dep. at p. 44 Langone testified that he became a licensed real estate salesman within a month of beginnng his employment with Extreme in 2005 or 2006 (Langone Dep. ' Tr. at p. 8). Langone also testified as follows: Q:What did you normally say to people when you called their properties? A: My name is Mike Langone , I'm with Extreme Realty, are you interested in sellng your propert. If they said yes or if, you know , they asked , do you have a buyer, yes , we , the owner of my company is looking to buy properties , and we also have a buyer in the neighborhood. That was prett much my pitch. Q: So you always told them that the owner was looking to buy properties? A: Yes. That's what I was told to do. Langone Dep. at p. Furermore , Langone testified that when he received a listing from a seller as a result of telephone calls he had placed , he asked the seller to sign something to agree to give him the right to sell the propert (Dep. at 19). With respect to the commissions under the listings he acquired on Radmin s behalf, Langone testified as follows: Q: Was there any discussion with Jim or Joel with regard to commissions? A: I was asked to -- I was told to ask if (the seller the LiusJ would pay the commission on it, and he (the LiusJ said no , and Joel (RadminJ said , fine , that is - I'll (Joel Radmin wilJ pay the commission. *** [* 5] Q: You initially asked Tommy (LiuJ to pay the commission? A: Yes. Q: And he (Tommy LiuJ said no? A: No. He (Tommy LiuJ said ask my buyer, meaning Joel (RadminJ, to pay the commISSIOn. Q: Did you get a check at the closing? A: No. Q: Did you get a check afterwards? A: I got a check about aweek later from Joel (RadminJ. Langone Dep. at pp. 19- RULING OF THE COURT Leave to Amend CPLR~3025(b) provides that leave to amend the pleadings shall be " the proposed amendment clearly lacks merit or the opposing Acuri v. Ramos 7 AD.3d 741 (2d Dept. 2004); surrise. freely given " unless par demonstrates prejudice or Matter of Rouson 32 AD. 3d 956 (2d Dept. 2006). Where a motion for leave to amend a complaint is made long after the case is certified for trial , however, judicial discretion in allowing the amendment should be discrete prudent and cautious , and where the motion is made on the eve of trial be exercised sparingly. 2010), quoting , circumspect , judicial discretion should Tesser v. Allboro Equipment Co. 73 AD. 3d 1023 , 1026 (2d Dept. Morris v. Queens Long Is. Med Group, P. 49 AD.3d 827 , 828 (2d Dept. 2008). If a grant of leave to amend under such circumstances causes prejudice or surrise , the grant of leave constitutes an improvident exercise of discretion, especially in cases where there is no reasonable excuse offered for the delay in seeking leav(; to amend. Funding Corp. v. Reynolds 41 A. D.3d 524 Corp. 57 AD. 3d 889 , 892 (2d Dept. 2008). 525 (2d Dept. 2007) and citing Countrywide Velez v. South Nine Realty [* 6] Real Propert Law Aricle 12- B. Aricle 12- , Real Propert Law RPV' ~~ 440- 442- , titled " Real Estate Brokers and Real Estate Salesmen " is a regulatory statute setting up a comprehensive plan to assure , by means of licensing, that stadards real estate brokers and salesmen. 2 of competency, honesty and Park Avenue Associates v. professionalism are observed by Cross Brown Co., 36 N. Y.2d 286 289 (1975). RPL ~ 440-a requires real estate brokers and real estate salesmen to be licensed. Id. RPL ~ 442-a bars a real estate salesman from receiving or demanding a commission from anyone but a duly licensed real estate broker with whom he is associated. Wong Loh 162 A. v. 2d 683 684 (2d Dept. 1990). RPL 442-e(3) permits an aggrieved par recover a penalty from the offender of " not less than the amount of the sum of money received by him as such commission , compensation or profit and not more than four times the sum so received by him , as may be determined by the cour ( . J" As the licensing provisions contaned in Aricle 12- A Tsucalas C. of the RPL are penal in nature , they are to be strictly construed. 287 A. 2d 50 Kreuter 55 (2d Dept. 2001). Application of these Principles to this Action The Cour denies Plaintiffs ' motion based on the Cour' s conclusion that the deposition testimony does not support Plaintiffs ' claims inter alia that 1) Langone held himself out as a licensed real estate salesperson at a time that he was not in fact licensed; and 2) Langone demanded compensation from someone with whom he was associated i. e. Radmin , who was not a duly licensed real estate broker. A complete reading of Langone s sworn testimony confirms that Langone s inquiry ofLiu surounding the payment of his commission was par and parcel of the questioning surounding the listing; the Cour does not interpret that questioning to be a specific " demand" of the payment of his commission as contemplated by RPL ~ 442-a. Moreover, the record does not support Plaintiffs ' assertions that Radmin is liable to Plaintiffs because he supervised Langone and permitted him to violate (RPLJ ~ 442-a and 440-a" and not only permitted Langone to violate these sections but on both occasions... directed him to do " (Ps ' Memo of Law at p. 7). There is no factual support for these claims , paricularly given the Cour' s obligation strictly to construe these statutes. In light of the foregoing, the Cour concludes that the proposed amendment lacks merit and denies Plaintiffs ' motion. [* 7] All matters not decided herein are hereby denied. This constitutes the decision and order of the Cour. The Cour reminds counsel of their required appearance before the Court for a Pre-trial Conference on December 9 2011 at 9:30 a. ENTER DATED: Mineola, NY October 17 2011 HON. TIMOTHY S. DRISC lS. ENTERED . OCT 202011 NASSAU COUNTY COUNTY CLERK' S OFFICE
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