Miraglia v Fridman

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Miraglia v Fridman 2017 NY Slip Op 30817(U) March 8, 2017 Supreme Court, Rockland County Docket Number: 034844/2014 Judge: Thomas E. Walsh II Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various state and local government websites. These include the New York State Unified Court System's E-Courts Service, and the Bronx County Clerk's office. This opinion is uncorrected and not selected for official publication. [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 1] INDEX NO. 034844/2014 NYSCEF DOC. NO. 81 RECEIVED NYSCEF: 03/08/2017 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF ROCKLAND ------------------------------------------------------------------X PETER MIRAGLIA, DECISION AFTER TRIAL Index No.: 034844/2014 Plaintiff, -againstALEX FRIDMAN and NEW IMAGE COMPUTER SERVICES, INC., Defendant. ------------------------------------------------------------------X Thomas E. Walsh, II, J.S.C. The following presented from a trial constitutes conducted Plaintiff was represented the Decision and Orderofthe in the above-captioned undersigned litigation by counsel during the trial, and Defendant on the issues on October 17, 2016. also appeared by counsel. During the trial, the Court provided each party with a full and fair opportunity present witnesses, prosecute claims, present defenses, cross-examine object to the admission make arguments conducted Additionally, of documentary which they believed were persuasive. several conferences with the parties submitted In arriving the entirety the parties post-trial where memorandum the arguments evidence, including testimony admit and/or on contested Additionally, issues rulings, and prior to trial, the Court were fully discussed. arguing their positions. at this decision, the Court has reviewed, of the admissible and Defendant), evidence, proffer comments witnesses, to: evaluated, and considered from the two witnesses (Plaintiff from both sides during the trial, and the various exhibits introduced into evidence. By way of background, a Summons and Verified Complaint October 21, 2014 According November 14, 2014, FRIDMAN (hereinafter Plaintiff this matter was commenced (verified to an affidavit by counsel) through of service filed through served the commencement FRIDMAN) by delivering by Plaintiff with the filing of documents the documents 1 of 16 the NYSCEF system on the NYSCEF system on upon Defendant to Defendant, pursuant ALIX to Civil [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 2] NYSCEF DOC. NO. 81 INDEX NO. 034844/2014 RECEIVED NYSCEF: 03/08/2017 Practice Law and Rules 9 308(1). Defendant NEW IMAGE COMPUTERSERVICES, INC. (hereinafter NICS) was served through the Department of State on October 27, 2014. Defendants joined issue with the filing of an Answer on January 23, 2015. This action stems from loan payments made by Plaintiff to Bank of America, in the amount of $27,623.92, pursuant to a personal guaranty he signed on a line of credit issued to Defendant NICS. Plaintiff maintains that he was an employee, not an owner or shareholder, of Defendant NICS, which is solely owned by Defendant FRIDMAN. According to Plaintiff, Defendants applied for a business loan and asked Plaintiff to sign as a co-guarantor of the loan, on the oral promise that Plaintiff would be indemnified and/or reimbursed for and against all loss he might sustain by reason of executing and delivering the personal guaranty. Plaintiff maintains that in reliance on these promises, Plaintiff executed and delivered the personal guaranty on May 8, 2006. Defendant FRIDMAN was also a co-guarantor and is the sole stockholder and owner of Defendant NICS. When Defendants defaulted on the loan in August 2013, Plaintiff paid the creditor $27,623.92 and now asserts that Defendants have failed to reimburse him, despite their oral promise to do so. Plaintifffiled an Amended Verified Complaint asserting causesof action for breach of implied contract of indemnity, promissory estoppel and unjust enrichment. The crux of Plaintiff's claims is that Defendants induced Plaintiff to execute and deliver the personal guaranty by, jointly and severally, promising and agreeing to pay the entire loan and reimburse and indemnify Plaintiff for and against all loss and damages that he might sustain by reason of executing and delivering the personal guaranty. Defendants dispute that FRIDMAN told Plaintiff that he would indemnify him in case of a default. FRIDMANavers that he and Plaintiff founded NICS together, with FRIDMANbeing the sole shareholder and president. He maintains he and Plaintiff shared responsibility for running the company, with Plaintiff being the "finance guy." Defendant FRIDMANfurther maintains that when the business started to suffer, Plaintiff proposed obtaining a line of credit which Plaintiff arranged through Bank of America and that 2 2 of 16 [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 3] NYSCEF DOC. NO. 81 INDEX NO. 034844/2014 RECEIVED NYSCEF: 03/08/2017 he and Plaintiff were business partners who both took a calculated business risk upon signing the loan documents. Further, Defendant FRIDMANasserts that both parties benefitted from the risk through the payment of their salaries and benefits. Defendant avers that Plaintiff signed the guaranty because it was in Plaintiff's best interests to do so and not because of a promise made by FRIDMANto indemnify him. Defendant FRIDMANalso stated that Plaintiff benefitted from the loan, which kept the business going for several years and Plaintiff benefitted from that income. In a Decision and Order dated October 17, 2016, the Court denied Plaintiff's motion for summary judgment indicating there were issues if fact in dispute and scheduled a trial for October 17, 2016. During the trial, Plaintiff called the Defendant FRIDMANand he testified that he and Plaintiff, PETERMIRAGLIA, (hereinafter MIRAGLIA), were friends. Further, Defendant testified that he and Plaintiff had worked in a prior business together and upon the closing of the first business Defendant NICS was formed in 1998. According to Defendant FRIDMAN's testimony, Plaintiffwas involved from the beginning with Defendant NICS. However, Defendant FRIDMAN testified that he was the sole incorporator, and the sole stockholder of NICS. Defendant FRIDMANalso testified that he never considered Plaintiff an "employee," but rather Plaintiff worked with Defendant NICS from the beginning and drew a salary just as Defendant FRIDMANhad done. Defendant FRIDMANtestified that Plaintiff, who was the "numbers guy of the business" informed the Defendant of the need for cash flow in the business, Defendant NCIS and came up with the idea to apply for a home equity line of credit. Defendant FRIDMAN further testified that Plaintiff MIRAGLIA suggested the business, Defendant NICS, needed to solicit a loan, as that was a manner in which the business could obtain funds. According to Defendant's testimony, Plaintiff, on behalf of Defendant NICS, arranged for a loan from Bank of America in the amount of $100,000 for which Plaintiff signed the note and agreement. Both parties agree in their testimony that due to Defendant FRIDMAN's credit issues Plaintiff and 3 3 of 16 [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 4] INDEX NO. 034844/2014 NYSCEF DOC. NO. 81 RECEIVED NYSCEF: 03/08/2017 Defendant were required to signa guarantee Defendant FRIDMAN in his testimony paid by automatic regarding the loan. stated that the aforementioned deduction from Defendant NICS' corporate account until the parties reached a money issue in 2011. At the time of the "money issue," Plaintiff Defendant NICS and Defendant FRIDMAN was solely attempting FRIDMAN's testimony, months in 2011. compensation later. business loan was upon his return, FRIDMAN testified but subsequently In 2012, Defendant testified had received a collection letter. that Plaintiff but returned for several received a salary and other left Defendant NICS employee a few months that Plaintiff contacted him and informed Plaintiff for to pay the loan. According to Plaintiff was no longer working for Defendants, Defendant no longer worked testified him that Plaintiff that the result of that contact Defendant FRIDMAN assured Plaintiff that he wa~ "working on" the defaulted was that loan. Again in 2013, Defendant FRIDMAN testified that Plaintiff contacted him and stated that collections were coming after Plaintiff testimony, for the defaulted business loan. he sent a letter to the Department loan) and informed According of Treasury to Defendant FRIDMAN's (owner of the defaulted them that despite the personal guarantee signed, Plaintiff business was not an employee of NICS, had no stock in the company seeking to remove Plaintiff from his personal guarantee. Defendant FRIDMAN asserted in his testimony felt badly for Plaintiff, no language within his long time friend. the letter Further, to demonstrate Rather Defendant FRIDMAN testified length of the parties relationship friend. Defendant FRIDMAN also testified in the letter that indicates there was any indemnification existence between the parties. never intended that the letter was sent because he Defendant FRIDMAN's testimony the existence agreement indicates of an indemnification that he sent the letter on Plaintiff's and was an attempt that there was by Defendant testimony loan he would have, due to their friendship. he conceeded Plaintiff paid $27,623.92 behalf based on the FRIDMAN to help an old In Defendant 4 of 16 portion of FRIDMAN's direct of his own money as guarantor 4 that he agreement. Defendant FRIDMAN also testified that if he had the money to pay Plaintiff's the defaulted in of the loan. [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 5] NYSCEF DOC. NO. 81 INDEX NO. 034844/2014 RECEIVED NYSCEF: 03/08/2017 The following exhibits were introduced during Defendant Plaintiff's Exhibit 1 - A note and agreement. Plaintiff's Exhibit 2 - A letter FRIDMAN's testimony: sent by Defendant Treasury on August 8,2013 of their business and FRIDMAN indicating that to the Department of Plaintiff is not an employee Defendant FRIDMAN was solely responsible for the debt. Defendant's counsel cross-examined of Defendant ALEX FRIDMAN on cross examination Defendant FRIDMAN.1 Within the testimony he reiterated his relationship and Defendant NICS, the reason behind the sending of the letter tothe regarding Plaintiff's guarantee $920,000 NICS. of which personally Defendant Also, during Defendant and Plaintiff NICS paid back $885,724.81, paid back $27,623.92 testified that based on the nature of the friendship several times that Defendant attempted $10,000 when he left the company. examination, of Treasury FRIDMAN's cross he indicated that the total amount borrowed by NICS under the line of credit was dollars $38,416.67 Department role in Defendant NICS company and stated that Plaintiff had no ability to the funds owed by Defendant examination with Plaintiff personally. Defendant Defendant between himself and Plaintiff, to help Plaintiff with funds, including Subsequently, according to Defendant paid back FRIDMAN there were giving Plaintiff FRIDMAN's cross when Plaintiff returned to employ at NICS the Defendant also paid health care for Plaintiff as an independent contractor so that Plaintiff and his family had health insurance. During Defendant FRIDMAN's testimony, he stated that his portion of the funds paid back to Bank of America came from the sale of several accounts in the business and his .. personal funds. He also stated that he never made a promise (implied, IDefendant was called by Plaintiff as their first witness. 5 5 of 16 oral or written) to [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 6] INDEX NO. 034844/2014 NYSCEF DOC. NO. 81 Plaintiff RECEIVED NYSCEF: 03/08/2017 that keep wouldn't have to pay on the aforementioned guarantee Defendant FRIDMAN asserted that Plaintiff and himself both benefitted line of credit, as the funds received paid both parties salaries, payments cell phone payments) Defendant FRIDMAN testified the ramifications and kept the business that Plaintiff, of a personal guaranty from the home equity allowed for benefits afloat as the "financial agreement. (i.e. car for some time. guy of the business/' Further, understood and was aware that Bank of America or their assignees could collect on part or the whole home equity loan if there was a default. In support of his testimony, A, the guarantee agreement Defendant FRIDMAN offered as Defendant's of Plaintiff and as Defendant's Exhibit Exhibit B, the certified transcript of the loan account. Plaintiff MIRAGLIA also testified as to the parties relationship business arrangements. prior company company "operations MIRAGLIA stated that he had. worked with Defendant and in 2003-2004 Defendant end" he began working NICS in the "operations was scheduling, assurance and anything and history of their regarding end." receivables, with Defendant FRIDMAN for the new MIRAGLIA testified payables, working the day to day operations FRIDMAN ina with that his role in the the of the business. staff, quality According to Plaintiff MIRAGLIA, in 2006 the line of credit loan was first discussed, though he could not recall if the conversation had occurred with Defendant FRIDMAN or FRIDMAN's wife. He testified that he believed that "they" spoke with him about the loan for the purpose of implementing he did after researching and gathering documents from several banks. Plaintiff it, which MIRAGLIA. testified that Defendant FRIDMAN picked the bank for the loan, signed the paperwork attempted to apply MIRAGLIA testified for the loan with that Defendant his name as the sole guarantor. would not be responsible Further, Plaintiff FRIDMAN was rejected due to his credit rating and at that point Defendant FRIDMAN asked Plaintiff MIRAGLIA to sign a co-guarantee. along with that request Defendant and even FRIDMAN made an oral agreement for the obligations on the loan. 6 6 of 16 Plaintiff Plaintiff avers that that Plaintiff MIRAGLIA MIRAGLIA additionally [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 7] NYSCEF DOC. NO. 81 INDEX NO. 034844/2014 RECEIVED NYSCEF: 03/08/2017 testified that the aforementioned assurance was made orally to him on several occasions prior to the signing of the guarantees, at the time of the signing of the guarantees and in 2012 (after Plaintiff had left Defendant NICS employ and after the default on the loan). Plaintiff MIRAGLIAsubsequently testified that he left his employ with Defendants in late 2010, early 2011, but returned to the company approximately three to four months later. According to Plaintiff upon his return to Defendant NICS' employ he was given a salary and he went back to his old health insurance. However, Plaintiff testified in September or October 2011 that Defendant could no longer afford to pay him and Plaintiff left his employment. Plaintiff testified that he subsequently learned the aforementioned line of credit .was in default when he began receiving collection calls from Bank of America. As a result of the calls, Plaintiff testified he contacted Defendant FRIDMAN and they spoke about how to handle the situation. According to Plaintiff, Defendant FRIDMAN assured him that Plaintiff would "take care" of the loan. According to Plaintiff, he continued to receive collections calls and eventually money was collected by the creditor from him for the default of the line of credit, specifically Plaintiff's 2013 tax return. Plaintiff asserts that he again contacted Defendant and that as a result of their conversation Defendant FRIDMANwrote a letter to the Department of Treasury trying to remove Plaintiff as personal guarantor. According to Plaintiff's testimony the aforementioned letter was written by Defendant FRIDMAN, as the intent of the parties agreement was always for Plaintiff to be indemnified as to the repayment of the loan. According to Plaintiff he ultimately paid at least $27,000 upon the default of the line of credit. Upon cross examination, Plaintiff MIRAGLIAacknowledged that the language in the guarantee he signed indicated that it could not be contradicted by any "prior contemporaneous or subsequent oral agreements or understandings of the parties." Upon immediate re-direct examination Plaintiff indicated that he believed that the guarantee agreement and the references to the outside agreements pertained to the bank providing the loan, Bank of America, and did not address any agreements between himself and Defendant 7 7 of 16 [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 8] NYSCEF DOC. NO. 81 RECEIVED NYSCEF: 03/08/2017 FRIDMAN. Plaintiff continued to indemnify INDEX NO. 034844/2014 Defendant to contend in his testimony that Defendant prior to the signing of the guarantees At the close of testimony, the Court permitted made an agreement at issue in this action. each side to make summations. Plaintiff's counsel asked the Court to disregard the extraneous arguments about Plaintiff's title while employed by Defendant FRIDMAN at Defendant NICS and instead focus on whether Defendant FRIDMAN induced agreement that Defendant Plaintiff into signing FRIDMAN would reimburse argued that Defendant testified a guarantee or indemnify based on an oral Plaintiff. Plaintiff further that the parties were close friends, that the Defendant could not pay the money and if he could have he would have paid the money so that Plaintiff was not responsible for his portion of the loan guarantee. the money was due to parties long standing indemnification documents agreement. Additionally, he had demonstrated Defendant FRIDMAN argued the desire to pay friendship Plaintiff and not the existence assert~d that through that from the inception of an implied his testimony of the loan Plaintiff thought Defendant FRIDMAN would pay the money owed on the line of credit, that Plaintiffrelied that belief and would not have signed. the guarantee if he believed and that upon he was financially responsible for the debt. Defendant argued that the three causes of action in the instant matter all hinge upon the explicit promise alleged to have been made by Plaintiff. cause of action is breach of an implied enrichment and the third presented with dueling which is assumed presumption promise of indemnification, was for promissory testimony Further he stated that he first estoppel. Defendant the second was unjust avers that the Court is of the two witnesses and a signed guarantee to be legitimate and made that Plaintiff must overcome. knowingly Additionally, and voluntarily agreement, and that Defendant argues that there was no evidence presented that the personal guarantee at issue was not made knowingly, and intelligently by the Plaintiff. As a result, Defendant asserts that no evidence presented by Plaintiff to rebut or overcome the presumption 8 8 of 16 is a that goes againstthe voluntarily has been Plaintiff. [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 9] INDEX NO. 034844/2014 NYSCEF DOC. NO. 81 RECEIVED NYSCEF: 03/08/2017 As to the cause of action for unjust enrichment, Defendant argues that payments were made on the line of credit, the money received went to the parties mutual benefit (i.e. salary, benefits and continued existence of the employer Defendant NICS). However, the Court notes the parties disagree about the account in which the money was placed and the use of the funds in their entirety. Additionally, in opposition to the unjust enrichment and promissory estoppel Defendant asserts that there must be a promise to rely on, and that there has been "absolutely no evidence presented" that Plaintiff was aware of a promise, or that a promise was made and that states that no promise was ever made. In making this decision, the Court has also relied on its personal observations the witnesses in determining Court to specifically issues of credibility. mention any particular It should be noted that the failure of the piece of evidence in this Decision and Order does not mean that item has not been considered by the Court. obligation to review all admitted of evidence, As the trier of fact, it is the Court's but that duty does not mean that all admitted evidence is necessarily accepted at face value. The Court has carefully and has evaluated observed and listened to the witnesses all evidence in light of its relevance, weight, and, where applicable, materiality, credibility, permissible inferences have been considered. been viewed in light of the appropriate Court recognizes the importance legal authority during the trial and interpretive importance, The evidence has case decisions. The of the instant Decision and Order to each of the parties. The Court notes that Plaintiff and Defendant were represented by very capable counsel throughout the proceedings and during the trial. FINDINGS A party's OF FACT AND CONCLUSIONS right to indemnifctaion OF LAW may arise from a contract or may be implied "based upon the law's notion of what is fair and proper as between the parties." Bridges Assoc, 75 NY2d 680, 690 (1990)]. "Implied 9 9 of 16 indemnification [Mas v. Two is based in simple fairness [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 10] INDEX NO. 034844/2014 NYSCEF DOC. NO. 81 RECEIVED NYSCEF: 03/08/2017 and seeks to avoid unjust enrichment by 'recogniz[ing] that a person who, in whole or in part, has discharged a duty which is owed by him, but which as between himself and another should have been discharged by the other, is entitled to indemnity." [McDermott 50 NY2d 211, 217 (1980)]. v. City of New York, Further, the right to indemnify "springs from a contract express or implied and full, not partial reimbursement is sought." [McDermott, 50 NY2d at 216]. In a circumstance in which an unfairness would arise from the assumption bya third party of another's debt or obligation, "a contract to reimburse or indemnify is implied by law." [State v. Stewart Ice Cream, Co., Inc., 64 NY2d 83, 88 (1984)]. The existence of an implied contract in which the parties have reached an agreement can be inferred by the parties actions and the circumstances surrounding the factions. [Spencer Trask Software Fsupp 2d 428 (S.D.N.Y. 2003)]. and Information Services, LLC v Rpost Intern, Memorial Hospital, 383 In other words, a contract cannot be "implied in fact" in a circumstance in which the facts are inconsistent with the existence of the contract. Julia Butterfield Ltd., 205 AD2d 526 (2d Dept 1994)]. [Tjoa v. More clearly stated, "[a]n implied-in-fact contract arises in the absence of an express agreement, and is based on the conduct of the parties from which a fact finder may infer existence and terms of contract." [AEB & Assocs. Design Group, Inc., v. TonIa Corp., 853 FSupp724,731 (S.D.N.Y. 1994)]. Therefore, the determination of whether the conduct of a party creates an implied contract is a question of fact, which must be determined by looking at the facts of the specificcase. [Today, Inc. v. Westwood One, Inc., 684 FSupp 68,71 (S.D.N.Y. 1988)]. In making the determination, the court must look at whether the party to be charged has conducted themselfin such a way that their agreement may be inferred. [Miller v. Schloss, 218 NY400, 407 (1916)]. In order to demonstrate that a defendant is liable to a plaintiff for promissory estoppel three elements must be demonstrated: (1) a clear and unambigious promise, (2) a reasonable and foreseeable reliance by the party to whom the promise is made and (3) an injury sustained by the party asserting the estoppel by reason of his/her reliance. [Ripple's of 10 10 of 16 [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 11] INDEX NO. 034844/2014 NYSCEF DOC. NO. 81 RECEIVED NYSCEF: 03/08/2017 Clearview, Inc. v. Le Havre Associates, 88 AD2d 120, 122-123 (2d Dept 1982); Esguire Radio & Elecs., Inc. v. Montgomerv Ward & Co., 804 F.2d 787 (2d Cir 1986); King & Sony. Canst. NO.2 Corp., 413 NYS2d 78 (Sup. Ct NY Cty 1977); Agress v. Clarkstown District, 69 AD2d 769, 771 (2d Dept 2010); Gurreri v. Associates DeSantis Central School Ins. Co., 248 AD2d 356 (2d Dept 1998)]. Finally, defendant to demonstrate (1) was enriched, unjust enrichment, (2) the enrichment the plaintiff was at the Plaintiff's is against equity and good conscience to permit the defendant expense and (3) that it to retain what is being sought. [GFRE, Inc. v. U.S. Bank, N.A., 130 AD 3d 569, 570 (2d Dept 2015); AD3d 998, 1001 (2d Dept 2014); Citibank, must show that the Mobarak v. Mowad, 117 N.A. v. Walker, 12 AD3d 480, 481 (2d Dept 2004); Whitman Realtv Group, Inc. v. Galano, 41 AD3d 590, 592-593 inquiry in any action for unjust enrichment or restitution (2d Dept 2007)]. is whether The essential it is against equity and good conscience to permit the defendant to retain what is sought to be recovered. Film Distrib. Corp. v. State of New York, 30 NY2d 415, 421 (1972)]. been unjustly surrounding enriched is essentially inference the transfer of property and the relationship 40 NY2d 119, 123 (1976)]. In making a determination must apply the principles of equity. in a circumstance [Id]. a received benefit. "A conclusion that orie has drawn from of the parties." regarding the circumstances [Sharp v. Kosma Iski, unjust enrichment Further, a person may be unjustly where money or property receives a benefit - the satisfaction 1983); a legal [Paramount the court enriched not only. is received, but also where the person otherwise of a debt, or the saving of an expense or loss is considered [Blue Cross of Cent. New York, Inc. v. Wheeler, 93 AD2d 995 (4th Dept Electric Ins. Co. v. Travelers Ins. Co., 124 AD2d 431, 432 (3d Dept 1986)]. Therefore, action for implied in the instant action in order for the Plaintiff to maintain indemnification, Plaintiff must demonstrate that Defendant a cause of made an oral promise to indemnify him on the line of credit loan guarantee and that Plaintiff relied upon that promise at the time of signing the guarantee agreement. 11 11 of 16 Plaintiff must provide proof of . [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 12] INDEX NO. 034844/2014 NYSCEF DOC. NO. 81 RECEIVED NYSCEF: 03/08/2017 conduct and/or agreement actions regarding of Defendant from which this Court can infer the existence the indemnification. The Court found the testimony credible. Much of the parties testimony indemnification of an agreement. responsible for arranging of both Plaintiff and Defendant to be candid and was consistent, other than the portion regarding the The Court will note that the parties both testified that Plaintiff was the line of credit at issue in this action and that they both proceeded to the bank to sign the documents needed to process the loan. However, the Court notes that the parties disagreed who brought forth the idea and need for the company to apply for a line of credit. Defendant FRIDMAN admits in his testimony to remove Plaintiff as a guarantor party testified that the terminology regarding the repayment terminology. guarantor that he told Plaintiff he would attempt for the loan, or that he would "work out the loan." "indemnify" of the loan. Plaintiff MIRAGLIA admitted Neither or anything of the like was used in discussions Each party testified using vague that when Defendant and ambigious FRIDMAN asked him to be a on the line of credit that he was concerned due to the parties friendship. Further, Plaintiff stated that he spoke with Defendant FRIDMAN to ensure that the money was paid back by Defendant, as he did not want to be responsible for the final payments. Plaintiff's concerns, Plaintiff testified [PI. Direct, p. 59, line 13]. that conversation contained intent to indemnify that Defendant FRIDMAN stated "we will make it work." Plaintiff continued indicated that Plaintiff wouldn't in his testimony stating have to be responsible for the debt. no direct and concrete agreement agreement in the letter sent from Defendant Treasury, which sought to remove Plaintiff as guarantor FRIDMAN Again, the substance of demonstrating the Defendants upon the existence intent in sending the letter. of an implied FRIDMAN to the Department on the loan. of In the Court's review of the letter, the Court notes that there is no language within the statements that the Defendant's Defendant the Plaintiff. The Plaintiff has based much of his argument indemnification In response to that would indicate Further, the FRIDMAN letter only indicates 12 12 of 16 [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 13] NYSCEF DOC. NO. 81 that RECEIVED NYSCEF: 03/08/2017 it seeks to remove indemnification Plaintiff agreement. to an indemnification the Department as guarantor from No I.anguage or statement agreement of Treasury the loan was based on an implied exists in the letter that is tantamount or refers to the existence of one. regarding Plaintiff's there was an implied indemnification within the letter to the Department of the alleged agreement. testified Defendant FRIDMAN would have stated such of Treasury, as it would be no loss to him to inform them to that occurred between the parties. First in addressing the testimony the as it stands demonstrated the agreement the Court must note that the parties were (30) years and had worked together Additionally, The testimony of the parties In fact, both Plaintiff and Defendant testified thirty to support of the situation. whether existence of an implied indemnification of approximately in the letter agreement there would need to be more specific terminology if vague and fails to clarify the ambiguity not strangers. of Defendant It would appear to this Court if For the Court to find the language existence of an indemnfiication and conversations agreement, The letter instead informs status as solely an employee NICS, and his lack of ability to guarantee the loan as a result. Defendant. INDEX NO. 034844/2014 they were long standing friends in a prior company owned by the they both testified that Plaintiff was responsible for operations financials of the Defendant business NICS. It is clear also from the testimony and that Plaintiff was aware of the risks signing the guarantee on the line of credit - he knew Defendant FRIDMAN could not obtain the line of credit without his guarantee and hE;! xpressed concern that the line e of credit needed to be repaid and that payments. Nothing within concern to the Defendant express or implied contract. Defendant he was wary that he may be responsible the language used by Plaintiff in describing his expressions indicate to this Court that a right to indemnity The facts as presented in the parties testimony FRIDMAN to the Department of Treasury are insufficient demonstrate by a preponderance agreement. Defendant FRIDMAN's conduct both in his statements for final "sprung" of from an and the letter from and inconsistent to of the evidence the existence of an implied indemnification 13 13 of 16 to the Plaintiff and also the [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 14] NYSCEF DOC. NO. 81 INDEX NO. 034844/2014 RECEIVED NYSCEF: 03/08/2017 terminology within the aforementioned letter and the fact that the letter was sent to the Department of Treasury fail to demonstrate Defendant's assent to an implied indemnification agreement. As to the cause of action sounding in promissory estoppel, similarly the Court finds that the testimony of the Plaintiff and Defendant are diamterically opposed as to the existence of an indemnification agreement. The testimony of Plaintiff fails to show a clear and unambigious promise existed between Plaintiff and Defendant FRIDMAN regarding whether Plaintiff would be responsible as a guarantor or Defendant FRIDMAN intended on indemnifying Plaintiff. Specifically, the record is devoid of any clear representation made by Defendant FRIDMANto Plaintiff that Defendant FRIDMANwould pay the entire line of credit. Additionally, there was no evidence presented by the Plaintiff at the trial that demonstrated any reliance on Defendant FRIDMAN's alleged promise of indemnification. The letter sent by Defendant FRIDMAN on Plaintiff's behalf to the Department of Treasury is vague, the substance of which can be explained by their lengthy friendship, previous business relationship/involvement and Defendant FRIDMAN's desire to shield Plaintiff from the losses of a business in which the Plaintiff was no longer involved. Nothing within the testimony or the words written in the aforementioned letter rises to the level of a clear and unambigous agreement regarding indemnification. Additionally, there was no evidence presented by Plaintiff of reliance on the alleged implied indemnification agreement. Therefore, the count sounding in promissory estoppel was not proved by Plaintiff by a preponderance of the evidence. Finally, as to the allegations sounding in unjust enrichment, the Court again reaches the conclusion that no promise of indemnification existed. Contrary to Defendant's argument, a cause of action for unjust enrichment does not depend upon plaintiff's receipt of promise and subsequent reasonable reliance. However, evidence presented by Plaintiff in support of the unjust enrichment cause of action was deficient in demonstrating that the Defendant was enriched. Defendant FRIDMAN'stestimony, which was unchallenged by Plaintiff 14 14 of 16 [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 15] INDEX NO. 034844/2014 NYSCEF DOC. NO. 81 RECEIVED NYSCEF: 03/08/2017 is that he paid $38,416.67 toward the defaulted loan more than the Plaintiff. In reality the payments of Defendant FRIDMAN were in excess of those of Plaintiff and that makes the request that Defendant FRIDMAN pay the Plaintiff's additional share inequitable The testimony of the parties demonstrates agreed to become a guarantor testified Plaintiff enjoyed of the line of credit for Defendant NICS and that the proceeds Specifically, both Plaintiff and that some of the funds were used for salaries and benefits, during his employment by Defendant NICS. Plaintiff's line of credit is evidence of his knowledge of the ramifications Plaintiff has raised no dispute that Defendant years and even paid approximately by a preponderance As a resultbf Plaintiff has failed indemnification to repay the of becoming a co-guarantor paid by Plaintiff. Therefore, Plaintiff on FRIDMAN paid the loan over many The claim of unjust Plaintiff's part appears to the Court to be a method upon which Plaintiff enrichment that he $38,000 of his personal funds toward the defaulted which was in excess of the amount benefit under the guise of equity. which the testimony expressed concern to Defendant FRIDMAN about the seriousness of the obligation the loan. behalf. that Plaintiff knew what he was signing when he received from the line of credit were used to benefit Plaintiff. Defendant on Defendant's loan, enrichment on is seeking a further has failed to prove his claim of unjust of the evidence. the Court's findings of fact as detailed above, the Court finds that to sustain its burden of proving the existence of an oral promise of from the Defendant to the Plaintiff prior to the execution of the loan documents and that the Plaintiff relied upon that promise when he signed the loan documents. the Court finds that the Plaintiff states that a promise of indemnification states it did not, with no extrinsic In the circumstance proof by way of writings Specifically, existed and Defendant or witnesses presented by Plaintiff. in which the court is presented with an equal division of the weight of the evidence, and "the evidence as a matter of logical necessity is equally balanced, plaintiff failed to meet his burden and the cause of action is not made out./I [Rinaldi Fargo Alarm Serv., 39 NY2d 191, 196 (1976)]. burden of proving his case by a preponderance Therefore, the Plaintiff of the evidence. 15 15 of 16 has & Sons v. Wells failed to sustain his [*FILED: ROCKLAND COUNTY CLERK 03/08/2017 10:48 AM 16] INDEX NO. 034844/2014 NYSCEF DOC. NO. 81 RECEIVED NYSCEF: 03/08/2017 As a result of the Court's findings of fact, the Court is constrained Complaint in its entirety as the Plaintiff existence of an implied indemnity has failed to sustain its burden of establishing the the three elements of promissory estoppel or that the Defendant was unjustly enriched as a result of Plaintiff paying approximately $27,000 based on the guarantee agreement Counsel for Plaintiff introduced agreement, to dismiss the he signed on the defaulted shall retrieve into evidence within twenty In light of the foregoing, from the loan. Part Clerk of the it is hereby that the Complaint ORDERED that in light of the Court's ruling, this matter Dated: constitutes any exhibits (20) days from the date of this Decision and Order. ORDERED The foregoing Court is dismissed in its entirety; and it is further is marked disposed. the Opinion, Decision and Order of this Court. New Ci. New York March -0-,2017 HON. THOMAS E. WALSH, II Justice of the Supreme TO: STEWART G. EINHOWER, P.c. Attorney for Plaintiff (via e-fiIe) STEPHEN S. COBB, ESQ. COBB & COBB Attorney for Defendant (via e-file) 16 16 of 16 Court

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