Castro v Fermin

[*1] Castro v Fermin 2016 NY Slip Op 50294(U) Decided on March 14, 2016 Supreme Court, Queens County Nahman, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 March 14, 2016
Supreme Court, Queens County

Jose Castro and ROSA CASTRO, Plaintiffs,

against

Maria E. Fermin, EXIT REALTY SUCCESS, J.C. FIRST CORP., JORGE ANDRADE, MOSHE ABRAHAM, BARRY N. FRANK, ESQ., GORRITI REAL ESTATE & LEGAL SUPPORT SERVICES d/b/a 888CASA GORRITI & WATERS COMPANY, INC., and JEFFREY GALPERIN, ESQ., Defendants.



16001-2014
Robert L. Nahman, J.

Upon the following papers numbered 1 to 30 read on this motion by defendant Maria E. Fermin, defendant Exit Realty Success, and defendant JC First Corp., for an order, inter alia, dismissing the complaint against them, or in the alternative, to disqualify Barry N. Frank, Esq., from representing plaintiffs in this action and on this cross motion by plaintiff Jose Castro and plaintiff Rosa Castro for an order permitting them to serve an amended complaint:

Papers

Numbered

Notice of Motion/Affirm(s)-Exhibits 1 - 4

Notice of Cross Motion & Affirm in Opposition-Exhibits 5 - 26

Affirm in Opposition & Reply. 27 - 28

Memorandum of Law 29

Memorandum of Law 30

IT IS ORDERED that the branch of the motion for an order dismissing the amended complaint as to defendant Maria E. Fermin, defendant Exit Realty Success, and defendant JC First Corp., pursuant to CPLR §3211(a)(7) for failure to state a cause of action is granted as to the causes of action enumerated 1, 2, 4 - 13, 16, 17, 21, 22, 25, and 26 - 29.

ORDERED that the branch of the motion dismiss the plaintiff's complaint for failure to state a cause of action is denied as to the causes of action enumerated (3) and (15) for fraud, (18) unjust enrichment, (20) tortious interference with contract, and (23 & 24) breach of fiduciary duty. Causes of action enumerated 14 and 19 are asserted against defendant Andrade and were not the subject of this motion; and it is further

and it is further

ORDERED the plaintiffs' cross motion for an order permitting the service of an amended complaint is granted but not in the form that plaintiff's have proposed. Plaintiffs are given leave to serve, within thirty days of the service of a copy of this order with notice of entry, an amended complaint asserting causes of action against defendant Maria E. Fermin, defendant Exit Realty Success, and defendant JC First Corp., for fraud, aiding and abetting fraud, conspiracy to commit fraud, breach of fiduciary duty, unjust enrichment, tortious interference with contract, and quieting title; and it is further

ORDERED that the alternative relief moved for in the motion by defendant Maria E. Fermin, defendant Exit Realty Success, and defendant JC First Corp., to disqualify plaintiff's counsel Barry N. Frank, Esq., from representing the plaintiffs is denied.

The plaintiffs began this action on November 3, 2014 by the filing of a summons and a complaint. On September 22, 2015, defendants Fermin, Exit Realty, and JC First submitted the instant CPLR 3211(a)(7) motion, and the plaintiff submitted a cross motion for an order permitting the service of an amended complaint. The proposed amended complaint has twenty-nine causes of action.

"Filing of an amended pleading does not automatically abate a motion to dismiss that was addressed to the original pleading, ( Sage Realty Corp. v. Proskauer Rose LLP, 251 AD2d 35; see, Sobel v. Ansanelli, 98 AD3d 1020; 49 West 12 Tenants Corp. v. Seidenberg, 6 AD3d 243.) The party moving to dismiss has the option to decide whether its motion should be applied to the new pleading., Id. In the case at bar, the [*2]defendants did not withdraw their CPLR §3211(a)(7) motion and, indeed, submitted reply papers. As such, their motion will be considered a motion to dismiss the amended complaint.

Plaintiffs allege in their amended complaint that they owned a home located at 41-30 Benham Street, Elmhurst, New York which they wanted to convert from single-family to two-family. In 2003, an attempt to refinance the property and make the conversion failed. Plaintiffs allege that on or about August 1, 2005, defendant Jorge Andrade proposed to plaintiff Castro that he convey the property to both Andrade and himself for the purpose of obtaining new financing. Plaintiffs allege that in consideration of Andrade's help in obtaining a new mortgage, Castro agreed to pay Andrade $10,000 cash and make all the payments on the new mortgage. Plaintiffs allege that on September 15, 2005, Castro delivered a deed to Andrade who executed a mortgage for $640,000. Plaintiffs allege that throughout 2005 and 2006, Castro, who is a contractor, worked on the conversion of the home and that some time in the middle of 2006, Andrade told plaintiff to make the mortgage payments to Andrade and that he would pay the mortgage. Plaintiffs allege that on June 26, 2006, Andrade refinanced the property without Castro's knowledge, and the latter did not receive any money from the transaction. Plaintiffs allege that shortly thereafter they learned that plaintiff Jose Castro's name had not been placed on the deed.

Plaintiffs further allege that n the fall of 2007, defendant Maria Fermin approached Castro, who knew her through friends and family, purportedly with a plan to help him. Fermin is a licensed realtor with defendant Exit Realty Success and an officer of JC First Corp. Plaintiffs allege that Castro told Fermin that he was the equitable owner of the property, and she suggested that he transfer the property to a family member in a "short sale." Castro took Fermin's advice and decides to transfer the property to his nephew, Carlos Barrera. Fermin's fee for the "short sale" was $5,000. Andrade informed Castro that he wanted $15,000 to transfer the property to Barrera. On December12, 2008, Fermin prepared a contract of sale from Andrade to Barrera, and on February 9, 2009, Golden First Mortgage Corp. approved a mortgage for Barrera in the amount of $642,625. Castro repeatedly asked Barrera and Andrade to close the sale, but they never did. . In early 2010, Castro asked Andrade to sell the property to his daughter Veronica and son-in-law Jorge Chiraboga, but that transaction did not close either.

On May 6, 2010, Castro received a notice from the Bank of New York that the property would be sold in a foreclosure sale pursuant to a default judgment. Castro hired an attorney and successfully had the judgment of foreclosure vacated. However, on June 27, 2014, defendant Andrade, using Fermin and Exit Realty, sold the plaintiffs' home to JC First Corp., for $244,000.

In determining a motion brought pursuant to CPLR §3211(a)(7), the court "must afford the complaint a liberal construction, accept as true the allegations contained therein, accord the plaintiff the benefit of every favorable inference and determine only whether the facts alleged fit within any cognizable legal theory ***." ( 1455 Washington Ave. Assocs. v. Rose & Kiernan, 260 AD2d 770, 770-771; Esposito-Hilder v. SFX Broadcasting Inc, 236 AD2d 186.) "The sole criterion is whether from [the complaint's] four corners factual allegations are discerned which taken together manifest any cause of action cognizable at law'***." ( Mayer v. Sanders, 264 AD2d 827, 828 quoting Guggenheimer v Ginzburg, 43 NY2d 268, 275; see, Aranki v. Goldman & Associates, LLP, 34 AD3d 510; Operative Cake Corp. v. Nassour, 21 AD3d 1020.)

"It is enough now that a pleader state the facts making out a cause of action, and it matters not whether he gives a name to the cause of action at all or even that he gives it a wrong name ***." ( Diemer v. Diemer, 8 NY2d 206, 212; Van Gaasbeck v. Webatuck Cent. Sch. Dist. No. 1, 21 NY2d 239.)

The first cause of action in the amended complaint is asserted against defendant Fermin and defendant JC First and is for "bad faith" in the purchase of the property. The first cause of action, like much of the amended complaint, is not a model of good draftsmanship. The first cause of action is captioned "Defendants Fermin and JC First bought the plaintiffs' property in bad [faith] & fail the test of a bona fide purchaser for value under common law." The court can only speculate about what cause of action the plaintiffs have attempted to assert based on the common law and how it may be distinguished from other causes of action in the amended complaint, e.g., fraud. Moreover, while the New York Recording Act (Real Property Law § 290 et seq.)"protects a good faith purchaser for value from a prior unrecorded interest in real property provided, inter alia, that the subsequent purchaser's interest is the first to be duly recorded" (Transland Assets, Inc. v. Davis, 29 AD3d 679, 679), the court finds that this statute has no relevance to the facts alleged in the first cause of action.

Accordingly, the court finds that the first cause of action in the amended complaint fails to state a cause of action.

The second cause of action is asserted against the moving defendants and purports to be for a violation of Real Property Law §266, "Rights of purchaser or incumbrancer for valuable consideration protected," which provides: "This article does not in any manner affect or impair the title of a purchaser or incumbrancer for a valuable consideration, unless it appears that he had previous notice of the fraudulent intent of his immediate grantor, or of the fraud rendering void the title of such grantor." ( Williams v. Mentore, 115 AD3d 664.) The statute provides a defense to a good faith purchaser for value, and [*3]the plaintiffs did not cite any cases showing that it creates a cause of action for the monetary damages they seek.

Accordingly, the court finds that the second cause of action in the amended complaint fails to state a cause of action.

The third cause of action is for fraud. Reading plaintiff Castro's complaint liberally and in its entirety, the court finds that the complaint states a cause off action for aiding and abetting fraud. "To plead a cause of action to recover damages for aiding and abetting fraud," the pleading "must allege the existence of an underlying fraud, knowledge of the fraud by the aider and abettor, and substantial assistance by the aider and abettor in the achievement of the fraud ***." (Winkler v. Battery Trading, Inc., 89 AD3d 1016 1017; In re Woodson, €" AD3d &mdash, €" NYS3d &mdash, 2016 WL 400027.) The complaint alleges the commission of a fraud by Andrade. In order to state a cause of action for fraud, a plaintiff must allege (1) that the defendant made material representations that were false or concealed a material existing fact, (2) that the defendant knew the representations were false and made them with the intent to deceive the plaintiff, (3) that the plaintiff was deceived, (4) that the plaintiff justifiably relied on the defendant's representations, and (5) that the plaintiff was injured as a result of the defendant's representations. (See, Lama Holding Co. v. Smith Barney, 88 NY2d 413; New York Univ. v. Continental Ins. Co., 87 NY2d 308; Watson v. Pascal, 27 AD3d 459; Cerabono v. Price, 7 AD3d 479; New York City Transit Authority v. Morris J. Eisen, P.C., 276 AD2d 78; American Home Assur. Co. v. Gemma Const. Co., Inc., 275 AD2d 616; Swersky v. Dreyer & Traub, 219 AD2d 321.)

Andrade allegedly falsely stated to Castro that he would put both of their names on the deed to the property and would make mortgage payments. A misrepresentation of intent maybe sufficient to constitute a false statement of presently existing fact. (See, Neckles Builders, Inc. v. Turner, 117 AD3d 923.) The complaint further alleges that Fermin learned from Castro that he was the equitable owner of the property and that, despite such knowledge, Fermin and Exit Realty helped Andrade transfer the property to JC First Corp. for $244,000.

The court can also discern a cause of action for conspiracy to commit fraud. "In order to properly plead a cause of action to recover damages for civil conspiracy, the plaintiff must allege a cognizable tort, coupled with an agreement between the conspirators regarding the tort, and an overt action in furtherance of the agreement ***." (Perez v. Lopez, 97 AD3d 558, 560.) The plaintiff has adequately alleged a fraud committed by Andrade, and the complaint permits the inference that Fermin, knowing how he acquired the property, agreed to help him complete his tortious conduct by [*4]facilitating the transfer to JC First for cash.

The fourth cause of action is asserted against defendants Fermin and Exit Realty and purports to be for violation of General Business Law §349. That statute makes unlawful "[d]eceptive acts and practices in the conduct of any business, trade or commerce or in the furnishing of any service in this state ***." ( See, Oswego Laborers' Local 214 Pension Fund v. Marine Midland Bank, N.A., 85 NY2d 20.) The complaint does not adequately allege that Fermin is falsely representing herself to the public as a mortgage broker. Moreover, the plaintiff's conclusory allegations that Fermin is directing such a representation to consumers at large are insufficient to sustain a cause of action under General Business Law §349. (See, Camacho v. IO Practiceware, Inc., -AD3d-, - NYS3d-, 2016 WL 380679.)

Accordingly, the court finds that the fourth cause of action in the amended complaint fails to state a cause of action.

The fifth cause of action is asserted against defendant Fermin and defendant Exit Realty and purports to be for violation of General Business Law §350, "False advertising unlawful," and §350-a " False advertising." (See, In re Small Smiles Litig., 109 AD3d 1212.) These statutes have no relevance to this case.

Accordingly, the court finds that the fifth cause of action in the amended complaint fails to state a cause of action.

The sixth cause of action is asserted against defendant Fermin and defendant Exit Realty and purports to be for violation of Banking Law§ 590(2)(b). (See, Balsam v. Fioriglio, 41 Misc 3d 361.) The statute provides that "(b) No person, *** shall engage in the business of soliciting, processing, placing or negotiating a mortgage loan or offering to solicit, process, place or negotiate a mortgage loan in this state without first being registered with the superintendent as a mortgage broker ***." The complaint does not allege that the defendants provided the plaintiffs with a mortgage loan or helped him obtain one or that the plaintiff's injuries arose from the provision of mortgage services. Moreover, a plaintiff seeking to recover for the violation of a statute must demonstrate that the violation was the proximate cause of his injury. (See, e.g, Scofield v. Avante Contracting Corp., 135 AD3d 929.)

Accordingly, the court finds that the sixth cause of action in the amended complaint fails to state a cause of action.

The seventh cause of action is based on Real Property Law §441-c. The statute, [*5]which provides for the revocation or suspension of broker's and real estate salesman's licenses, has no relevance to this case.

Accordingly, the court finds that the seventh cause of action in the amended complaint fails to state a cause of action.

The eighth cause of action is based on Real Property Law §442-c, "Violations by salesmen; broker's responsibility." The statute which deals with, inter alia, the revocation or suspension of the license of a broker, has no relevance to this case.

Accordingly, the court finds that the eigth cause of action in the amended complaint fails to state a cause of action.

The ninth cause of action is based on Real Property Law §443," Disclosure regarding real estate agency relationship; form." The statute requires real estate licensees who are acting as agents of buyers or sellers of property to inform potential buyers or sellers with whom they work about the nature of their agency relationship and the rights and duties it creates. The plaintiffs allege that the "defendants did not disclose that they were acting in a fiduciary capacity with defendant Andrade." The complaint does not adequately allege that the defendants had a fiduciary relationship with Andrade who sold the property to JC First or that a violation of the statute was a proximate cause of the plaintiff's injury.

Accordingly, the court finds that the ninth cause of action in the amended complaint fails to state a cause of action.

The tenth, eleventh, twelfth, and thirteenth causes of action purport to be based on Real Property Law §§175.5,175.7, 175.10, and 175.4 respectively. Sections 169 to 183 of the Real Property Law have been repealed.

Accordingly, the court finds that the tenth, eleventh, twelfth, and thirteenth causes of action in the amended complaint fail to state a cause of action.

The fourteenth cause of action, which is for fraud, is asserted against defendant Andrade and is not a subject of this motion.

The fifteenth cause of action asserts fraud against defendant Fermin, defendant Exit Realty, and defendant JC First. The fifteenth cause of action, read liberally, alleges that the defendants falsely represented to the plaintiff that they were working to further his interests, but they were actually working to further defendant Andrade's interests. [*6]Read liberally, and in conjunction with the second cause of action, the court can discern a cognizable cause of action for fraud whose elements include a false statement and/or the concealment of a material existing fact, scienter, reliance, and injury. (See, Lama Holding Co. v. Smith Barney, supra; New York Univ. v. Continental Ins. Co., supra; Watson v. Pascal, supra; Cerabono v. Price, supra; New York City Transit Authority v. Morris J. Eisen, P.C., supra; American Home Assur. Co. v. Gemma Const. Co., Inc., supra; Swersky v. Dreyer & Traub, supra.).

Accordingly, the court finds that the fifteenth cause of action in the amended complaint states a cause of action.

The sixteenth cause of action is for fraud in the inducement. The plaintiffs allege that all of the defendants made"misrepresentations and material omissions *** for the purpose of inducing the Plaintiffs to enter into contracts so that Defendants would receive money from said contracts." Defendant Fermin allegedly induced plaintiff Castro to enter into "short sale" contracts with Barrera and subsequently with his daughter and son-in-law, but the plaintiff failed to adequately allege that these transactions were tainted by fraud.

Accordingly, the court finds that the sixteenth cause of action in the amended complaint fails to state a cause of action.

The seventeenth cause of action is for conversion. Conversion is the unauthorized assumption and exercise of the right of ownership over property belonging to another to the exclusion of the owner's rights. (See, State v. Seventh Regiment Fund, Inc., 98 NY2d 249, 259.) However, "no cause of action sounding in conversion will lie where the property that is the subject of the dispute is real property ***." (Crawford v. Smith, 130 AD3d 968, 969.) "An action sounding in conversion does not lie where the property involved is real property ***." (Garelick v. Carmel, 141 AD2d 501, 502; Scott v. Fields, 85 AD3d 756, 757, 925 N.Y.S.2d 135, 137 (2011).

Accordingly, the court finds that the seventeenth cause of action in the amended complaint fails to state a cause of action.

The eighteenth cause of action is for unjust enrichment. To state a claim for unjust enrichment, the plaintiff must allege "that (1) the other party was enriched, (2) at that party's expense, and (3) that it is against equity and good conscience to permit the other party to retain what is sought to be recovered ***." ( Mandarin Trading Ltd. v. Wildenstein, 16 NY3d 173, 182 [brackets and internal quotation marks omitted]; Georgia Malone & Co., Inc. v. Rieder, 19 NY3d 511, 516.) The complaint adequately states a [*7]cause of action for unjust enrichment.

Accordingly, the court finds that the eighteenth cause of action in the amended complaint states a cause of action.

The nineteenth cause of action, which is for breach of contract, is asserted against defendant Andrade and is not the subject of this motion.

The twentieth cause of action is for tortious interference with contract. The elements of a cause of action for tortious interference with contract include " the existence of a valid contract between the plaintiff and a third party, defendant's knowledge of that contract, defendant's intentional procurement of the third-party's breach of the contract without justification, actual breach of the contract, and damages resulting therefrom ***." ( Lama Holding Co. v. Smith Barney Inc., 88 NY2d 413, 424.) The amended complaint adequately alleges that defendant Fermin, knowing of the contract between plaintiff Castro and defendant Andrade, induced Andrade to breach the contract by selling the property to JC First.

Accordingly, the court finds that the twentieth cause of action in the amended complaint states a cause of action.

The twenty-first cause of action, which alleges that the defendants "engaged in a consumer-orientated misleading practice," appears to be duplicative of the cause of action based on General Business Law §349, and the court has already found that cause of action to be not sufficiently stated. The plaintiffs cited no authority showing that New York recognizes a separate and distinct cause of action for "a consumer-orientated misleading practice" other than one based on General Business Law §349 and similar statutes.

Accordingly, the court finds that the twenty-first cause of action in the amended complaint fails to state a cause of action.

The twenty-second cause of action alleges negligent misrepresentation. The elements of a cause of action for negligent misrepresentation are : (1) the existence of a special relationship of trust or confidence, which creates a duty for one party to impart correct information to another, (2) the information given was false, and (3) reasonable reliance upon the information given. ( See, Hudson River Club v. Consolidated Edison Co., 275 AD2d 218; General Electric Capital Corp. v. United States Trust Co. of New York, 238 AD2d 144.) The plaintiffs do not adequately state what misinformation the defendants gave them.

Accordingly, the court finds that the twenty-second cause of action in the amended complaint fails to state a cause of action.

The twenty-third cause of action is for breach of fiduciary duty. The elements of a cause of action for breach of fiduciary duty are (1) the existence of a fiduciary relationship, (2) misconduct by the defendant, and (3) damages directly caused by the defendant's misconduct. ( See, Daly v. Kochanowicz, 67 AD3d 78; Fitzpatrick House III, LLC v. Neighborhood Youth & Family Services, 55 AD3d 664; Kurtzman v. Bergstol 40 AD3d 588.) "A fiduciary relationship exists between two persons when one of them is under a duty to act for or to give advice for the benefit of another upon matters within the scope of the relation ***." (EBC I, Inc. v. Goldman, Sachs & Co., 5 NY3d 11, 19, quoting Restatement [Second] of Torts § 874, Comment a ). "[A] real estate broker is a fiduciary with a duty of loyalty and an obligation to act in the best interests of the principal ***." (Dubbs v. Stribling & Assoc., 96 NY2d 337, 340; Ader v. Guzman, 135 AD3d 668; Cornwell v. NRT NY LLC, 95 AD3d 637.) The complaint adequately alleges that the defendant broker did not act in the best interest of plaintiff Castro, but rather engaged in acts of self-dealing.

Accordingly, the court finds that the twenty-third cause of action in the amended complaint states a cause of action.

The twenty-fourth cause of action alleges that the defendants breached their fiduciary duty by "omitting and failing to disclose any interest which could influence his/her conduct in his/her capacity as agent." " [I]t is a basic duty of a fiduciary to disclose all relevant facts to his beneficiaries. " (Avena v. Ford Motor Co., 85 AD2d 149, 153.) The complaint adequately alleges that the defendant brokers breached their fiduciary duty to plaintiff Castro by failing to disclose their relationship and transactions with Andrade.

Accordingly, the court finds that the twenty-fourth cause of action in the amended complaint states a cause of action.

The twenty-fifth cause of action is duplicative of the twenty-fourth cause of action.

The twenty-sixth cause of action, which purports to be for "exacting an illegal commission," alleges that the defendants wrongfully kept commissions taken when plaintiff Castro entered into contracts of sale for the property which were not consummated. The complaint fails to set forth the terms of the agreement between the plaintiff and the brokers.

Accordingly, the court finds that the twenty-sixth cause of action in the amended complaint fails to state a cause of action.

The twenty-seventh cause of action is based upon Real Property Law§ 441-e, "Denial of license; complaints; notice of hearing," which concerns the denial, suspension, and revocation of real estate licenses. The plaintiffs failed to show that this statute has any relevance to the case at bar or that a private cause of action may be based upon it. (See, Ader v. Guzman, 135 AD3d 671.).

Accordingly, the court finds that the twenty-seventh cause of action in the amended complaint fails to state a cause of action.

The twenty-eighth cause of action is a claim to the property by way of adverse possession. " A party seeking to obtain title by adverse possession on a claim not based upon a written instrument must establish, by clear and convincing evidence, that the possession of the subject land was hostile, under a claim of right, actual, open, notorious, and exclusive, and the possession must have been continuous throughout the statutory period *** Furthermore, pursuant to [RPAPL 522], that party must also establish that the subject land was either usually cultivated or improved' or protected by a substantial inclosure' ****." ( Gaglioti v. Schneider, 272 AD2d 436, 437; Katona v. Low, 226 AD2d 433.) The complaint fails to state a claim for adverse possession because, inter alia, the plaintiffs occupied the property with the permission or Andrade.

Accordingly, the court finds that the twenty-eigth cause of action in the amended complaint fails to state a cause of action.

The twenty-ninth cause of action is labeled "Successor Corporation Liable for Predecessor." The successor liability doctrine (see, DiMauro v. United, LLC, 122 AD3d 568) is not relevant to this case.

Accordingly, the court finds that the twenty-ninth cause of action in the amended complaint fails to state a cause of action.

CPLR §3025(b) provides that leave to amend a pleading "shall be freely given upon such terms as may be just." (See, Holchendler v. We Transport, Inc., 292 AD2d 568; St. Paul Fire & Marine Ins. Co. v. Town of Hempstead, 291 AD2d 488; Whitney-Carrington v. New York Methodist Hosp., 289 AD2d 326.) As a general rule, the amendment of a complaint will be permitted where there is no significant prejudice or surprise to the defendant. (See, Edenwald Contr. Co. v. City of New York, 60 NY2d 957; Holchendler v. We Transport, Inc., supra; Dal Youn Chung v. Farberov, 285 AD2d 524.) [*8]In the case at bar, the defendants did not demonstrate prejudice or surprise. The court must also consider the merits of the proposed amended pleading (see, Morgan v. Prospect Park Associates Holdings, LP, 251 AD2d 306; McKiernan v. McKiernan, 207 AD2d 825), and the court has done so by applying the defendants' CPLR 3211(a)(7) motion to the proposed amended complaint. This has resulted in the pruning of much dead wood from what the court hopes was not the drafter's best effort.

While these causes of action for fraud, aiding and abetting fraud, conspiracy to commit fraud, breach of fiduciary duty, unjust enrichment, tortious interference with contract, and quieting title may be discerned from the proposed amended complaint now before the court, a new draft is required to clarify what is at issue in this case. The proposed amended complaint in its present form requires much inference and interpretation and should be redrawn to adequately inform the defendants of what the plaintiffs intend to prove at trial€" a basic purpose of a complaint. (See, Cottone v. Selective Surfaces, Inc., 68 AD3d 1038.) The court will entertain a CPLR §3211(a)(7) motion directed at the new attempt by the plaintiffs' attorney to draft an adequate amended complaint.

Giving the amended complaint a liberal reading, it states causes of action against the moving defendants for fraud, aiding and abetting fraud, conspiracy to commit fraud, breach of fiduciary duty, unjust enrichment, tortious interference with contract, and quieting title.

Defendants also moved alternatively to disqualify Barry N. Frank, Esq., the plaintiffs' present attorney, on the grounds that he "had a role in the closing when Jose Castro transferred the property to Jorge Andrade" and that Frank might have knowledge about "whether or not the plaintiffs were aware at the time of the closing that they were not on the deed."

"[P]ursuant to rule 3.7 of the Rules of Professional Conduct (22 NYCRR 1200.0), unless certain exceptions apply, [a] lawyer shall not act as advocate before a tribunal in a matter in which the lawyer is likely to be a witness on a significant issue of fact' ***." (Friia v. Palumbo, 89 AD3d 896, 896; Spielberg v. Twin Oaks Const. Co., LLC, 134 AD3d 1015.)

Barry N. Frank, Esq., states that he had nothing to do with the closing in 2005, that he was an administrative law judge in New Jersey in 2005, and was not practicing law as an attorney, so therefore could not have represented any of the parties at the closing." The defendants did not submit affidavits or other proof rebutting Frank's allegations, and the unsubstantiated statements by the defendants' attorney that Frank bears witness to many [*9]of the allegations in the complaint, have no probative value.

The disqualification of an attorney is a matter that rests within the sound discretion of the Supreme Court, Trimarco v Data Entry, 91 AD3d 756 (2nd Dept., 2012). A party's entitlement to be represented by counsel of his or her choice is a valued right which should not be abridged absent a clear showing that disqualification is warranted, Id. In order to disqualify counsel, a party moving for disqualification must demonstrate that the testimony of the opposing party's counsel is necessary to his or her case, and that such testimony would be prejudicial to the opposing party, Id. Mere speculation that an attorney's testimony will be used at trial is not enough to disqualify the attorney, Goldberg v Eisner, 21 AD3d 401 (2nd dept., 2005)

The defendants have offered no evidence that the testimony of plaintiff's counsel is necessary, no evidence that he had first hand knowledge of the material facts relevant to the case, and have failed to demonstrate that counsel's testimony would be prejudicial to the plaintiffs.

Under the circumstances, the court finds that disqualification is not warranted.

Dated: March 14, 2016

Robert L. Nahman, J.S.C.