Matter of Bowser

[*1] Matter of Bowser 2016 NY Slip Op 51162(U) Decided on June 9, 2016 Surrogate's Court, Kings County L¢pez Torres, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 June 9, 2016
Surrogate's Court, Kings County

In the Matter of the Application of Eboni Imhotep, Administrator C.T.A. for the Estate of James E. Bowser For an order pursuant to SCPA Article 21 for a turnover and distribution of an estate asset, 721 Monroe Street, Brooklyn, N.Y. 11221



2014-1441/A



Attorney for Petitioner:

Robert M. Salzman, Esq.

Salzman and Salzman

26 Court Street, Suite 1901

Brooklyn, New York 11242

Attorneys for Respondents:

Kerry Archer, Esq.

Connors & Sullivan

7408 Fifth Avenue, Suite 2

Brooklyn, New York 11209

D. Michael Roberts, Esq.

Sanders & Gutman

26 Court Street, Suite 409

Brooklyn, New York 11242
Margarita L³pez Torres, J.

The following submissions were considered on this motion:

Papers Numbered

Petitioner's Notice of Motion dated January 13, 2016,

Affirmation of Robert M. Salzman, Esq., dated January 13, 2016,

Exhibits A through P, which include the Affidavit of Eboni Imhotep dated December 31, 2015,

Affidavit of Erika Kelley dated January 7, 2016 and the Affidavit of Kenyatta Ibrahim dated January 13, 2016 1,2,3,4,5,6

Respondent's Notice of Motion, Affirmation of Kerry Archer, Esq. dated January 14, 2016, and Exhibits A through G 7,8,9

Affidavit in Opposition by Rachael Lynch dated January 27, 2016,

Affirmation of D. Michael Roberts, Esq., dated January 29, 2016,

Exhibits numbered 1 through 3, Memorandum of Law dated January 29, 2016 10,11,12

Affirmation of Robert M. Salzman, Esq., in Opposition dated January 27, 2016 13

Affirmation of Kerry Archer, Esq. in Opposition dated January 29, 2016 14

Affirmation Robert M. Salzman, Esq., in Reply dated February 3, 2016 15

In this contested miscellaneous turnover proceeding, Eboni Imhotep (Imhotep or petitioner) moves for summary judgment seeking, inter alia, an order cancelling a certain deed and mortgage. Ralph Ramos (Ramos or objectant) cross-moves for dismissal of the proceeding. Emigrant Bank (Emigrant), in part, opposes the petitioner's summary judgment motion.

Background

The decedent, James E. Bowser (decedent), a Virginia domiciliary, died testate on March 31, 2006. The decedent's will, dated May 5, 1987, named his daughter, Bernice E. Bowser (Bernice) and Desaire M. Cyrus (Desaire) as co-executors. The will bequeathed the decedent's residuary estate to his two children, Edward Alan Bowser (Edward Alan) and Bernice "equally, share and share alike." The will was admitted to probate in the Circuit Court of Isle of Wight, Virginia on June 8, 2006 and Bernice and Desaire were appointed co-executors. In connection with the probate petition and the estate's administration, Bernice submitted affidavits in which she swore that the decedent was survived by herself and three grandchildren, Erika Kelley (Kelley), Imhotep and Kenyatta Ibrahim (Ibrahim), the children of the decedent's predeceased son, Edward Alan.[FN1] Further, she executed a sworn "Affidavit of Notice Regarding Estate of James Bowser" in which she detailed her attempts to provide notice of the probate proceeding to Edward Alan's children. She also executed a sworn "Inventory of the Decedent's Estate."

On July 16, 2008, Bernice executed a bargain and sale deed conveying the decedent's real property, 721 Monroe Street, Brooklyn, New York (real property) to herself as "the sole surviving heir of James E. Bowser and Bernice Munford Bowser." On this same day, Bernice obtained a mortgage on the real property for $280,000.00 (the mortgage) from Emigrant Bank (Emigrant). For the following four years, Bernice resided at the real property with her spouse, Ramos. On July 9, 2012, Bernice died, survived by Ramos, her sole distributee, who continues to reside in the real property.

On March 27, 2014, Imhotep petitioned and obtained letters of administration c.t.a. for the decedent's estate in Virginia. She then petitioned and was issued ancillary letters of administration c.t.a. on April 22, 2014 by this court. Imhotep thereafter filed a petition seeking an order i) setting aside and cancelling as void ab initio the deed dated July 16, 2008; ii) permitting petitioner to sell the real property; iii) determining that the mortgage be satisfied only against the mortgagor Bernice's 50% fee interest in the real property; iv) determining that a judgment docketed against Bernice be satisfied from her share of the estate; v) determining that the costs and disbursements incurred in this action, including reasonable attorneys' fees be reimbursed from Bernice's interest in the estate; and vi) determining that all of the property taxes and any other costs paid in connection with the real property until the date of sale be collected from Bernice's 50% interest. Ramos and Emigrant filed objections.

The Instant Motions

On January 13, 2016, Imhotep filed a motion for summary judgment seeking an order a) determining that Edward Alan's legacy under the decedent's will survived by operation of the anti-lapse statute, b) determining that Imhotep, Kelley and Ibrahim are the sole survivors of Edward Alan, and thus the owners of a 50% interest in the real property, c) determining that the deed and mortgage are both void ab initio, based on Bernice's false representation that she was the decedent's sole surviving heir, d) striking Ralph's objections, e) striking Emigrant's affirmative defenses, and g) awarding petitioner's costs and attorneys' fees.

Imhotep's moving papers consist of the affirmation of Robert M. Salzman, Esq., dated January 13, 2016, and Exhibits "A" through "O," which include the affidavits of Imhotep, Kelley and Ibrahim. In support of his cross-motion, Ramos has submitted the affirmation of Kerry Archer, Esq., dated January 14, 2016, and Exhibits "A" through "G". Emigrant has submitted its affidavit and affirmation in partial opposition, and a memorandum of law in opposition to the motion for summary judgment. Imhotep and Ramos have also submitted their respective opposition and reply papers.

Summary judgment may be granted only when it is clear that no triable issue of fact exists. Alvarez v. Prospect Hosp., 68 NY2d 320, 324 (1986), Phillips v. Kantor & Co., 31 NY2d 307 (1972). Initially, it is the petitioner's burden to establish that she is entitled to summary judgment by tendering sufficient evidence in admissible form to demonstrate the absence of any material issue of fact. Alvarez v. Prospect Hosp., 68 NY2d 320 (1986). If a prima facie showing is made, the burden of presenting proof, in admissible form, establishing that the movant is not entitled to judgment as a matter of law, shifts to the party opposing the motion. Zuckerman v. City of New York, 49 NY2d 557 (1980). Conclusory statements and unsubstantiated allegations are insufficient to defeat a motion for summary judgment. Zuckerman, 49 NY2d 557.

Imhotep, through numerous submissions, avers that she, Kelley and Ibrahim, are Edward Alan's children and sole distributees. Ramos' singular argument is that Imhotep "has not proven that she nor her siblings are the children of Edward Alan Bowser" under EPTL § 4-1.2(a)(2) and In re Davis, 27 AD3d 124 (2nd Dep't 2006).

Notably, in the Virginia probate proceeding, Bernice adopted a position contrary to that of Ramos' present stance. Bernice swore under oath that Imhotep, Kelley and Ibrahim were, indeed, the children of her predeceased brother, as reflected in a document titled "List of Heirs" dated June 8, 2006. Furthermore, on November 21, 2006, Bernice executed a sworn "Affidavit of Notice Regarding Estate of James Bowser" in which she detailed her attempts to provide notice of the probate proceeding to Edward Alan's children. Finally, Bernice executed a sworn "Inventory of the Decedent's Estate" on April 9, 2007, which indicated that this inventory was mailed to Imhotep and Kelley.

Pursuant to Virginia statute, a list of heirs made under oath and recorded constitutes prima facie evidence of the facts contained in the list. V.A. Code § 64.2-509(C). The predecessor to § 64.2-509(C), namely V.A. Code § 64.1-134, contained similar language, to wit, "[s]uch list so made and recorded shall be prima facie evidence of the facts therein stated." In the decedent's Virginia probate proceeding, Bernice swore that Imhotep, Kelley and Ibrahim were the known and only distributees of Edward Alan. Bernice did not refer to them as "alleged children," nor did she state that there were unknown children. In reliance of her submissions, the [*2]Virginia court issued a decree admitting the decedent's will to probate.

On the issue of the kinship status of Imhotep and her siblings, the court determines that Ramos, as the sole distributee of Bernice, is precluded in positing that Imhotep and her siblings have not proven that they are Edward Alan's children under the doctrine of judicial estoppel. The equitable doctrine of judicial estoppel precludes a party from adopting a position directly contrary to or inconsistent with a position he or she assumed in a prior proceeding. Maus v. Cornell University, 253 AD2d 1 (3d Dep't 1990), aff'd 94 NY2d 87 (1999); Baje Realty Corp. v. Cutler, 32 AD3d 307 (1st Dep't 2006); McCaffrey v. Schaeffer, 251 AD2d 300 (2nd Dep't 1998). Such a position may have been taken in a pleading, a deposition, or in testimony before the court. Boyers, Precluding Inconsistent Statements: The Doctrine of Judicial Estoppel, 80 NW U L Rev 1244, 1244-45 (1986). The doctrine serves a number of beneficial purposes. It enhances "the orderly administration of justice and regard for the dignity of judicial proceedings." Environmental Concern, Inc. v. Larchwood Constr. Corp., 101 AD2d 591 (2nd Dep't 1984), Karsmanki v. Terranova, 115 AD2d 640 (2nd Dep't 1985). It preserves the sanctity of sworn pleadings. It "prevent[s] a party from playing fast and loose with the courts, and to protect the essential integrity of the judicial process." In re Galerie Des Monnaies of Geneva, Ltd., 62 BR 224, 226 (SDNY 1986).

Since Bernice, in a judicial proceeding resulting in a favorable and desired outcome, affirmatively set forth the identity of the decedent's distributees in at least three separate documents, Ramos is precluded by the doctrine of judicial estoppel from now adopting an inconsistent position with respect to the decedent's heirs. "[Judicial estoppel] rests upon the principle that a litigant should not be permitted ... to lead a court to find a fact one way and then contend in another judicial proceeding that the same fact should be found otherwise." Environmental Concern at 593, quoting Note, The Doctrine of Preclusion Against Inconsistent Positions in Judicial Proceedings, 59 Harv. L. Rev. 1132 [1946].

In addition, the court determines that the petitioner has, indeed, established prima facie the kinship status of Edward Alan's children by the totality of the irrefuted and persuasive evidence submitted. Imhotep has submitted several affidavits, obituaries and birth certificates, including, the three submissions made by Bernice in the Virginia proceeding in support of summary judgment. Ramos has failed to submit any evidence whatsoever in rebuttal, aside from the mere conclusory allegation that the petitioner has not met her burden, which is insufficient to defeat a motion for summary judgment. Zuckerman, 49 NY2d 557. Accordingly, the petitioner's motion for summary judgment determining that Imhotep, Kelley and Ibrahim are the sole surviving children of their father, Edward Alan, is granted.

Imhotep further argues that the testamentary legacy to Edward Alan under the decedent's will vests in Edward Alan's surviving issue by virtue of the anti-lapse statute, EPTL § 3-3.3. Imhotep avers that the applicability of the anti-lapse statute turns on the presence or absence of "otherwise" language, which she asserts is lacking in the decedent's will. She avers that the term "share and share alike" is not an "otherwise" provision under EPTL § 3-3.3. In opposition, Ramos asserts that the anti-lapse statute is inapplicable, because the terms "equally" and "share and share alike" contained in the bequest to Bernice and Edward Alan constitute "otherwise" language or language of substitution.

The applicability of the anti-lapse statute is legally driven and therefore ripe for [*3]determination by summary judgment. The anti-lapse statute is a remedial statute based on the inference that a decedent intended to benefit a descendant of a legatee, except when the will dictates a contrary intent. EPTL § 3-3.3 (a)(1). See generally Matter of Goldberg, 36 AD2d 631(2nd Dep't 1971), Matter of Souter, 276 A.D. 1004 (4th Dep't 1999), Matter of Josephine F. Edwards, 13 Misc 3d 210 (Sur Ct Nassau County 2006). Such a contrary intent would be ascertained by the existence or lack thereof of so-called "otherwise" language, also referred to as "words of substitution." Matter of Schwartz, 1993 WL 13719129 (Sur Ct Nassau County 1993).

EPTL § 3-3.3, provides: (a) Unless the will whenever executed provides otherwise:(1) Whenever a testamentary disposition including a disposition of a future estate other than a future estate subject to a condition precedent of surviving the testator is made to a beneficiary who is one of the testator's issue or a brother or sister, and such beneficiary dies during the lifetime of the testator leaving issue surviving such testator, such disposition does not lapse but vests in such surviving issue, by representation.

The holding in Matter of Schwartz is instructive. There, one of the decedent's children, Howard, predeceased the decedent and was survived by two children. That court indicated the relevant provision of the will as follows:

[a]ll the rest, residue and remainder of my estate, both real and personal, I hereby give, devise and bequeath one-half thereof to my children, Howard, Robert, and Elliot in equal shares, share and share alike per capita...

The court in Schwartz determined that the language in the will contained no words of substitution and that the phrases "in equal shares" and "share and share alike" merely reinforce the bequest, and ruled that Howard's legacy vested to his children by application of the anti-lapse statute. See, also, Matter of Goldberg, 36 AD2d 631, supra. Here, the will, with virtually identical language as that employed in Schwartz, provides:

In the event my said wife, Bernice, predeceases me, then and in such event I do hereby devise and bequeath all of my property, both real and personal wheresoever situate of which I shall died seized or possessed or to which I may be entitled, to my two children, Edward Alan and Bernice equally, share and share alike.

As in Schwartz, the words, "share and share alike" contained in the subject will herein serve only to reinforce the bequest and indicate no other intention. The will lacks terms of substitution or "otherwise" language which would indicate an alternative disposition. Accordingly, the petitioner is entitled to summary judgment with respect to the applicability of the anti-lapse statute, and Edward Alan's legacy is vested in his children, Imhotep, Kelley and Ibrahim.

Finally, Imhotep contends that Emigrant's affirmative defense as a good faith encumbrancer should be stricken, because Bernice's false representation in the deed that she is the "sole surviving heir" of the decedent renders both the deed and the entire mortgage void ab initio pursuant to Cruz v. Cruz, 37 AD3d 754 (2nd Dep't 2007).

Initially, Emigrant opposes Imhotep's motion on procedural grounds. It contends that the petitioner may not be granted summary judgment on an unpleaded claim, namely that the mortgage itself be declared entirely void since the relief requested in the petition sought a determination that the mortgage could be satisfied only as against Bernice's 50% fee interest in [*4]the real property, but now argues that the entire mortgage be voided. This argument is unavailing. Summary judgment may be awarded on an unpleaded cause of action if the proof supports such a claim and if the opposing party has not been misled to its prejudice. Torrioni v. Unisul, Inc., 214 AD2d 314, 315 (1st Dep't 1995). As with a trial, the court may deem the pleadings amended to conform to the proof. Deborah International Beauty, Ltd. v. Quality King Distributors, Inc., 175 AD2d 791, 793 (2nd Dep't 1991). In this matter, the underlying facts concerning the conveyance of the real property and the procurement of the mortgage are not in dispute; rather, the court is being asked to determine the legal significance of the transaction, namely whether prevailing precedent dictates that the entire deed and mortgage be declared void ab initio or whether Emigrant's status as a mortgagee is at least secured as to Bernice's interest in the real property. The court is not constrained by the relief initially requested, since the facts are undisputed and the opposing party has not been misled to its prejudice. Indeed, the parties entered into a stipulation whereby they expressly agreed that this issue would be raised via a summary judgment motion and were afforded a full and fair opportunity to be heard.

This procedural point aside, Emigrant contends that the deed is effective to the extent of Bernice's undisputed 50% interest in the real property, and that therefore the mortgage is valid as to this one half-interest. Emigrant distinguishes Cruz relied on by the petitioner and cites Bayview Loan Servicing, LLC v. White, 134 AD3d 755 (2nd Dep't 2015) and Real Spec Ventures, LLC v. Estate of Livingston Mandel Deans, 87 AD3d 1000 (2nd Dep't 2011), for the holding that "such a mortgage is valid and enforceable as against the mortgagor's interest." Emigrant also argues that a ruling that the mortgage is void ab initio in its entirety would result in an unfair windfall to Bernice's estate and that the petitioner sustains no harm if the mortgage stands as a lien on Bernice's interest alone. Emigrant further asserts that even if the petitioner were to be successful in establishing fraud, the mortgage and deed would be valid as to Bernice's 50% interest by virtue of RPL § 266, which serves to protect an encumbrancer for valuable consideration, unless he had notice of the fraud, which Emigrant claims it did not have.

The Cruz case involved almost identical facts to the instant matter. There, the decedent was survived by six distributees. After his death, one of the distributees executed a deed transferring the decedent's real property to himself as sole heir and obtained a mortgage on the real property. The court rendered both the deed and the mortgage void ab initio, holding that it was legally impossible for the conveyor to encumber the subject property under such false pretenses. Cruz v. Cruz, 2006 WL 5347498, aff'd, 37 AD3d 754 (2nd Dep't 2007). "A deed based on forgery or obtained by false pretenses is void ab initio, and a mortgage based on such a deed is likewise invalid," Cruz at 754. Further, "[i]f a document purportedly conveying a property interest is void, it conveys nothing, and a subsequent bona fide purchaser or bona fide encumbrancer for value receives nothing," ABN AMRO Mtge. Group, Inc. v. Stephens, 91 AD3d 801, 803 (2nd Dep't 2012). See also Miles v. Archer, 116 AD3d 664 (2nd Dep't 2014); Solar Line, Universal Great Bhd., Inc. v. Prado, 100 AD3d 862, 863 (2nd Dep't 2012). Although Emigrant cites Faison v. Lewis, 25 NY3d 220 (2015), a Court of Appeals matter in support of its argument, said court cited and referred to Cruz with approval.

The Cruz decision underscores the principle that a deed obtained under the false representation that the grantor is the sole heir renders the deed void ab initio, and therefore, there can be no subsequent and valid encumbrance by a mortgagee. It is undisputed that Bernice knew [*5]that she was not the decedent's "sole surviving heir," as evidenced by her prior statements in the underlying probate matter where Bernice swore that Imhotep, Kelley and Ibrahim were also the decedent's distributees. Therefore, Bernice's representation that she was the decedent's sole heir in the deed is clearly false. Contrary to Emigrant's assertions that such a rule would leave it without recourse, it can seek redress against the estate of Bernice Bowser. Accordingly, summary judgment is granted determining that both the deed and mortgage are void ab initio.

Conclusion

For the foregoing reasons, the petitioner's summary judgment motion is granted; the affirmative defenses of Ralph Ramos are stricken; the objections of Emigrant are stricken; and the motion of Ralph Ramos is denied. Any issues not raised by Imhotep's summary judgment motion may be addressed during an accounting proceeding, if any.

The petitioner is granted reasonable attorneys' fees to be paid from Bernice's share of the decedent's estate incurred in connection with Imhotep's efforts to cancel the deed and mortgage. The court has discretion to allocate responsibility for the payment of a fiduciary's attorney's fees for which the estate is obligated to pay from the shares of individual estate beneficiaries. Matter of Hyde, 15 NY3d 179 (2010). The court has considered 1) that Bernice in executing the deed containing a false representation acted solely in her interest rather than the common interest of the estate and the decedent's other distributees, as was her obligation as the fiduciary of the decedent's estate; (2) Bernice's conduct in executing a deed as sole surviving heir when she was aware of the decedent's other distributees; and (3) Ramos' disingenuous position as to the distributees of the decedent. Further, it is clear that Imhotep was forced to commence the instant turnover proceeding as a result of Bernice's execution of a deed containing a false representation to the detriment of Edward Alan's heirs. Further, Imhotep has had to expend resources to dismiss Ramos' objections as to the status of Edward Alan's non-marital children unnecessarily.

A determination of the amount of reasonable legal fees will be held in abeyance pending the submission on notice of an affirmation of legal services with contemporaneous time records by the petitioner's counsel to be submitted within 20 days of this decision. Respondents shall have 20 days thereafter within which to respond to the reasonableness of the fees requested.

Settle decree.

Hon. Margarita L³pez Torres

Surrogate

Dated: June 9, 2016

Brooklyn, New York Footnotes

Footnote 1: Edward Alan died on November 11, 1993.