Mouzakiotis v Mouzakiotis
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Mouzakiotis v Mouzakiotis 2017 NY Slip Op 31952(U) August 29, 2017 Supreme Court, Suffolk County Docket Number: 11682/2013 Judge: William B. Rebolini 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. [* 1] Short Form Order SUPREME COURT - STATE OF NEW YORK I.A.S. PART 7 - SUFFOLK COUNTY PRESENT: WILLIAM B. REBOLINI Justice Niki Mouzakiotis, Motion Sequence No.: 005; MOTD Motion Date: 2/ 111 7 Submitted: 4/26/ 17 Plaintiff, -against- Index No.: 11682/2013 Styliani Mouzakiotis, Attorney for Plaintiff: Defendant. Bailey & Sherman, P.C. 40-26 Douglaston Parkway Douglaston, NY 11363 Attorney for Defendant: Ruskin Moscou Faltischek, P.C. 1425 RXR Plaza East Tower, 15th Floor Uniondale, NY 11556 Clerk of the Court Upon the following papers numbered 1 to 29 read upon this motion for summary judgment: Notice of Motion and supporting papers, 1 - 18; Answering Affidavits and supporting papers, 21 25; Replying Affidavits and supporting papers, 28 - 29; Other, Memorandum of Law, 19 - 20, 26 27; it is ORDERED that the motion by the defendant for an order pursuant to CPLR 3212 granting summary judgment dismissing the complaint and for an order severing and continuing her counterclaim is granted to the extent that the plaintiffs fourth and sixth causes of action are dismissed, and is otherwise denied. \(/ [* 2] Mouzakiotis v. Mou~..akiotis Index No.: 11682/2013 Page 2 This is an action seeking, among other things, damages and a j udgmenl declaring that the transfer of certain real property from the plaintiff to the defendant is void. It is undisputed that the plaintiff purehascd a single family dwelling located at 18 Longview Road, Southampton, New York (the premises) in 1995, and that the plaintiff executed a deed in 2004 attempting to transfer the premises, subject to the retention of a life estate, to a corporation purportedly owned by the defendant, her daughter. ln addition, the plaintiff executed a deed in May 2007 which conveyed title in the premises to herself and the defendant as joint tenants with right of survivorship, and a third deed together with the defendant dated January 2, 2008 conveying title from herself and the defendant as joint tenants to the defendant, subject to the retention of a life estate. The plaintiff alleges, among other things. that she made these transfers during times of stress in her marriage to the defendant's father, that the transfers were made in reliance on certain promises made by the defendant, and that the defendant improperly retained the proceeds ofa loan obtained by the plain ti ff in 2007 which was secured by a mortgage on the premises. In her complaint, the plaintiff sets forth six causes of action. ln her first and second causes of action for fraud and constructive fraud, the plaintiffalleges, among other things, that the defendant promised the plaintiff that she would ''protect [the plaintiffJ and provide some financial stability," that the defendant incurred debts against the premises and refused to return the premises to the plaintiff when asked to do so, and that the defendant knew that she did not intend to keep her promises when they were made. In her third cause of action for unjust cruichment and restitution, the plaintiff alleges that the defendant was unjustly enriched when she took the proceeds of the aforesaid mo1 tgagc loan. In her fourth cause of action for conversion, the plaintiff alleges that the defendant improperly retained the proceeds of the mortgage loan. In her fifth cause of action, the plaintiff seeks to impose an equitable or legal lien upon the premises. In her sixth cause of action for specific performance, the plaintiff alleges that the "transfer·' of the premises to the defendant in May 2007 "was made based upon fraudulent statements, promises, and assurances made to Plaintiff by Defendant." This action was commenced by the filing of a summons and complaint on April 29, 2013. In her answer dated June 3, 2013, the defendant sets forth three affirmative defenses and a counterclaim in which she alleges, among other things, that the deed dated January 2008 was executed to reflect the original agreement between the parties that the defendant would be the title owner of the premises subject to the plaintifrs life estate. and that the plaintiff has failed to meet her obligations as a life tenant. The defendant' s counterclaim seeks a judgment tenninating the plaintiff's life estate. By reply dated June 17, 2013, the plaintiff entered a general denial of the allegations in the defendant's counterclaim. The defendant now moves for summruy judgment dismissing the complaint and an order "severing and continuing'' her counterclaim. The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sur:ficient evidence to eliminate any material issue of fact (see A lvarez v Prospect Hosp., 68 NY2d 320. 508 NYS2d 923 [l 986); Wi11egrad vNew York Univ. Med. Ctr. , 64 NY2d 851, 487 NYS2d 316 ll 9851). The burden then shifts to the party opposing the motion which must produce evidcntiary proof in [* 3] Mouzakiotis v. Mouzakiotis I ndex No.: 11682/2013 Page3 admissible fonn sufficient to require a trial of the material issues of fact (Rotlt v Barreto, 289 /\D2d 557, 735 NYS2d 197 (2d Dept 2001]; R ebecclti v Wltitm ore, l 72 AD2d 600, 568 NYS2d 423 l2d Dept 1991]; O'Neill v Town of Fisltkill, 134 AD2d 487, 521 NYS2d 272 (2d Dept 1987)). r:urthermore, the parties' competing i11terest must be viewed ''in a light most favorable to the party opposing the motion" (Marine Midland Bank, N.A. v Dino & A rtie's A utomatic Transmission Co., 168 AD2d 610. 563 NYS2d 449 f2d Dept 1990]). In support of the motion, the defendant submits, among other things, the pleadings, her afiidavit, deeds reflecting the relevant conveyances herein, copies of th<.: aforementioned note and mortgage dated May 17, 2007, and excerpts of the deposition transcripts of the plaintiff and three nonparty witnesses. 111e Cou11 notes that the deposition transcripts of the three nonparty witnesses are unsigned and uncertified, and that the plaintiffs have failed to submit proof that the transcripts were forwarded to the witnesses for their review (see CP l,R 3116 la]). Under the circumstances, the deposition testimony of the non party witnesses is not in admissible form (see Marmer v IF USA Express, Inc. 73 AD3d 868, 899 NYS2d 884 [2dDept 201 OJ; Martinez v 123-16 Liberty Avenue. Realty Corp. , 4 7 AD3d 90 l , 850 NYS2d 201 [2d Dept 2008]; McDonald v Ma uss, 38 AD3d 727, 832 NYS2d 291 l2d Dept 20071). Although the transcript of the plaintiff's deposition suiTers from the same disabilities, the Court may consider said transcript submitted in support of the motion as the parties have not raised any chaUenges to its accuracy (Rodrig uez v Ry der Truck, Inc., 91 AD3d 935, 937 NYS2d 602 (2d Dept 2012]; Zalot v Zieba, 81 AD3d 935, 917 NYS2d 285 [2d Dept 20 11]). At her deposition, conducted with the aid ofan interpreter, the plaintiff testified that she docs not read or write English, that she currently resides ar the premises with her husband and her son, George, and that she has no other children beside George and the defendant. She stated that she had previously jointly owned a residence in Bayside, Queens with her husband, that she received some money from her mother and placed that residence in her name only, and that she sold that residence and had "extra money" and purchased the premises. She indjcated that she was laid off from work in 2004. that she asked the defendant for help in paying the real estate taxes on the premises at that time, and that the defendant said that "fi lfl do that, l need the deed." The plaintiff futther testified that, ''to save the house," she met with Frank Guarino, Esq. (Guarino), who had represented her in the sale of the Bayside house and the purchase of the premises, where she signed a deed dated February 10, 2004, that Guarino told her that "this paper is because (the defendant is] supposed to take the house and to be responsible for taxes and all of the things lo happen after that,'. and that the defendant only paid the first $6,000 of taxes for the premises. She indicated that, sometime thereafter, the defendant asked her to help bmrnw money so that the defendant could purchase a residence, that she was hesitant in case she again lost her job, and that the defendant said she would pay the loan once she had time to "'fix up" the new residence. She stated that she went to an office in Manhattan with the defendant, that a lawyer and another person "probably from the bank" was there, and that her signature appears on a deed dated May 17, 2007. The plaintiff further testified that she believed that the defendant was the owner of the premises at the lime she went to Manhattan, that no one explained the nature or purpose of the [* 4] Mouzakiotis v. Mouzakiotis Index No.: 11682/2013 Pagc4 document that she signed at that time, and that, although she understood that she was borrowing money from the bank, she was there because the defendant said the bank only needed her "good credit." She stated that thereafter, because her husband was threatening her and she did not believe that she had any "power" over the premises, she spoke with a lawyer named Kathleen who had been at the loan closing with her and the defendant in Manhattan, and that she signed some documents "the third time" in a car with Kathleen and the defendant. The plaintiff fmther testified that "from the beginning" she knew that the defendant owned the premises and she was "supposed to stay there;· but that she was not supposed to be paying the taxes and the mortgage loan which she had been doing. She stated that her signature appears on the subject "mortgage document." and that she is aware that the bank has started a foreclosure action against the premises. In her affidavit, the defendant swears that, in or about 2003, the plaintiff approached her "for financial assistance to pay certain debts.'' including ·'three years of real estate tax arrears for the Premises," and for money for other family expenses. She states that, in exchange for "substantial funds;' the plaintiff agreed to transfer the premises to a '·new business entity" that she was creating, but that her mother would retain a life estate. She indicates that she and the plaintiff"used" Guarino to prepare the documents for the transaction and to incorporate an entity called L'Etoile, Ud., that she "would be the sole owner of this corporation," and that Guarino prepared a deed dated February I0, 2004 to L'Rtoile, Ltd. (the 2004 deed). The defendant further swears that Guarino never filed the 2004 deed, that she paid the real estate taxes for the premises from 2003 to 2007, and that the plaintiff applied for a ''mortgage loan against the Premises'' in 2007 to pay some consumer debt and ··to assist me in buying a house." She states that she contacted Kathleen Sciandra, Esq. (Sciandra) to come to the mortgage loan closing to explain the documents «to my mother and me," that there was no record of the 2004 deed when they arrived at the bank attorney's office in May 2007, and that ·'to effectuate the mortgage financing ... a deed was prepared whereby my mother transferred ownership of the Premises to me and her as joint tenants with a right of survivorship" (the 2007 deed). She declares that the plaintiff executed a mortgage note in the amount of $220,000 at said loan closing, that she received $200,000 of the loan proceeds which it was agreed would be used by her "to purchase a home in Brooklyn in my name.'' and that it was agreed that the plaintiff would pay the '·carrying charges for the Premises in consideration for her life estate, including the mortgage payments, property taxes and all maintenance and repairs.,. The defendant further swears that, in or about January 2008, "the issues with my father became worse;' and the plaintiff asked Sciandra to prepare a deed transferring "any interest my mother had in the Premises to me,'' and that Sciandra suggested that the plaintiff retain a life estate. She states that a deed to that effect dated January 2, 2008 was signed by her and the plaintiff (the 2008 deed), that sometime thereafter her father learned of that the 2008 deed, and that the plaintiff " 11ed to Greece" in or about November 2009, only returning to stay at the premises ·'sporadically." She indicates that the plaintiff paid the mortgage for 22 months and ceased making the mo1tgage payments when she left the country, and that her father and brother continued to reside in the premises without her pennission, and without paying any of the carrying charges. The defendant further swears that the bank holding the subject mortgage began a foreclosure action in 2012. [* 5] Mouzakiotis v. Mouzakiotis Index No.: 11682/2013 Page 5 Here, the defendant has failed to establish her entitlement to summary judgment dismissing the plaintiffs first cause of action for fraud. Initially. the defendant contends that, because the plaintiff acknowledged that she "knowingly transferred" the premises to "a corporation owned by fthe defendant]" in 2004, this claim is barred by the six-yeaT s tatute of limitations (CPLR 213). However, the corporation is not a party to this action, and there are issues of fact including, but not limited to, whether the 2004 deed was delivered to the defendant or any representative of L'Etoile, Ltd., who were or arc the principals of L' Etoile, Ltd., and which of the three subject deeds is the critical document in determining the rights of the pa1iics. An action alleging fraud must be commenced within six years of the fraud or within two years from the time the plaintiff discovered the fraud or cou.ld with reasonable diligence have discovered it. whichever is later (see CPLR 213 (8); Carbon Capital Mgt., LLC vAmerican Express Co.. 88 AD3d 933, 932 NYS2d 488 [2d Dept 2011 ]). A plaintiff wrn be held to have discovered the fraud when it is established that he or she was possessed with knowledge of facts from which the 1978]; Erbe fraud could be reasonably inferred (see Trepuk v Frank , 44 NY2d 723 , 405 NYS2d L v Lincoln Roclzester Trust Co., 3 NY2d 321, 165 NYS2d 107 ll957J). Here, the defendant's testimony is that she paid the real estate taxes until 2007. This action was commenced in 2013. If tbe 2007 deed is operative herein, the defendant has failed to submit evidence as to the relevant dates in those years, and when the six-year period ran or when the defendant could reasonably infer that a fraud. if any, had taken place. If the 2008 deed is operative herein, it appears that this cause of action is not barred by the statute. The elements of a cause of action for fraud arc ( I) a misrepresentation of fact, (2) which was false and known to be false by the defendant, (3) made for the purpose of deceiving the plaintiff, (4) upon which the plaintiffjustifiably relied, (5) causing injury (see Clearview Con crete Prods. Corp. v S. Charles Gherardi, Inc., 88 AD2d 461, 453 NYS2d 750 [2d Dept 1982]; see also Oze/ka11 v Tyree B ros. Envtl. Servs. , 29 AD3d 877, 815 NYS2d 265 [2d Dept 2006]). Here, there are issue of facts whether the 2004 deed, the 2007 deed, or the 2008 deed is the effective document herein, and whether the defendant misrepresented the natme of the loan to the plaintiffand otherwise committed a fraud thereby. The defendant has also failed to establish her entitlement to summary judgment dismissing the plaintiffs second cause of action for constructive fraud. "Constructive fraud may be defined as the breach of a duty which. irrespective of moral guilt and intent, the law declares fraudulent because of its tendency to deceive, to violate a confidence, or to injure public or private interests that the law deems worthy of special protection" (Brown v Lock wood, 76 AD2d 721, 432 NYS2d 186 f2d Dept 1980] ; see also Sears v First Pioneer Farm Credit, A CA, 46 AD3d 1282, 850 NYS2d 219 [3d Dept 20071; Williams v lynch, 245 AD2d 715 , 666 NYS2d 749 [3d Dept 1997]). "The clements of a cause of action to recover for constructive fraud arc the same as those to recover for actual fraud with the crucial exception that the element of scienter upon the part of the defendant, his [or her] knowledge of the falsity of his representation, is dropped ... and is replaced by a Tcquirement that the plaintiff prove the existence of a fiduciary or confidential relationship warranting the trusting party to repose his [or her] confidence in the de fondant and therefore to relax [* 6] Mou7 ,akiotis v. Mouzakiotis Index No.: 11682/2013 Page6 the care and vigilance he [or she] would ordinarily exercise in the circumstances" (Brown v Lockwood, 76 AD2d at 731, 432 NYS2d l86; see Levin vKitsis, 82 A.D.3d 1051 , 920N.Y.S.2d 131 [2d Dept 2011 ]). Here, the defendant has failed to eliminate all issues regarding the existence of a fiduciary or confidential relationship with the plaintiff. Similarly, the defendant has fai led to establ ish her ent itlement to summary judgment dismissing the plaintiffs third cause of action for unjust emicluncnt. To succeed on a claim for unjust enrichment, a plaintiff must establish that the defendant was enriched at the plaintiffs expense, and that "it is against equity and good conscience to permit the defendant to retain what is sought to be recovered" (Paramount Film Distrib. Corp. v State ofNew York, 30 NY2d 415, 421 , 334 NYS2d 388 [1972]; see Whitman Realty Group v Galano, 41AD3d590, 838 NYS2d 585 [2d Dept2007); Cruz vMcAneney, 31AD3d54, 816 NYS2d 486 l2d Dept 2006]). Here, the defendant has failed to eliminate all issue of fact regarding her receipt and use of $200,000 of the mortgage loan proceeds, and whether, even if her claim that said funds were in consideration of the plaintiffs life estate is established at trial, there is any relationship between said amount and the value of the subject life estate. However, the defendant has established her prima facie entitlement to summary judgment dismissing the plaintiff's fourth cause of action for conversion. Conversion is the unauthorized "exercise of dominion over or interference with" a specific identifiable piece of property in defiance of the owner' s rights (Petty v Barnes, 70 /\D3d 661 , 894 NYS2d 85 f2d Dept 20101; Hoffman v U11terberg, 9 AD3d 386, 780 NYS2d 617 l2d Dept 2004J). The to1t of conversion "can occur even though there is no wrongful intent to possess the property of another" (Spodek v Liberty Mut. J11sunmce. Co. , 155 AD2d 439, 441 , 547 NYS2d 100, I 03 L2d Dept 1989]; Ahles v Aztec Enters. , 120 AD2d 903, 502 N YS2d 821 [3d Deptj, lv denied 68 NY2d 611 , 510 NYS2d 1025 [1986)). However, " [w]here one is rightfully in possession of propc1ty, one's continued custody and refusal to deliver it on demand of the owner unti l the owner proves. hi s right to it does not constitute conversion" (Melllnum Mgt. Corp. v Fong May Fan , 121 AD2d 609, 610, 503 NYS2d 642 f2d Dept 19861; see also Green Complex, Inc. v Smith, 107 AD3d 846, 968 NYS2d 128 [2d Dept 2013]; Transportation World Trading, Lid. v North Sit ore Univ. Hosp. at Plainview, 64 AD3d 698, 882 NYS2d 685 [2d Dept 2009]). Here, the plaintiff' s testimony reveals that she voluntarily obtained a loan and granted the defendant access to a significant portion of the proceeds even if there may be another cause of action which would enable her to recover some or all of said monies. The mere right to payment caimot be the basis for a cause of action alleging conversion (Zendler Com;tr. Co., Inc. v First Adj. Group, Inc. , 59 AD3d 439. 873 NYS2d 134 [2d Dept 2009J). The Court now turns to the branch of the defendant ' s motion for summary judgment seeking to dismiss the plaintiff's fifth cause of action for an equitable [ien or a legal lien on the premises. "The existence of an equitable lien requires an express or implied contract concerning specific property wherein there is a clear intent between the parties that such property be held, given or transferred as security for an obligation" (Ryan v Cover, 75 AD3d 502, 502, 904 NYS2d 750 [2d [* 7] Mouzakiotis v. Mouzakiotis Index No.: J1682/2013 Page7 Dept 201 OJ, quotingDatlof v Turetsky, 111 AD2d 364, 365, 489 NYS2d 353 t2d Dept 1985]). The defendant' s testimony raises issue of fact as to the express or implied agreement of the parties regarding the mortgage loan proceeds and the transfer of the premises in May 2007. There are also issues of fact regarding the defendant' s testimony that she ceased paying the real estate taxes for the premises in 2007 at the time the plaintiff obtained a loan, mostly for the defendant's benefit, that the loan proceeds were given to her in payment of the plaintifrs life estate when the defendant contends that the plaintiff already possessed a life estate and the deed created at the loan closing did not contain a clause reserving a life estate to the plaintiff Thus, the defondant has failed to established her prima facie entitlement to summary judgment dismissing the plaintiff's fifth cause of action. I lowcvcr, the defendant has established her prima facic entitlement to summary judgment di smissing the plaintiffs sixth cause of action for specific performance. Tn this branch of her motion, the defendant contends that this cause of action is duplicative of the plaintiff's cause of action for fraud. In her sixth cause of action, the plaintiff alleges that "l t]he transfer of said real propeity to Defendant ... was made based upon fraudulent statements, promises, and assurances made to Plaintiff ... [and] was illegal and invalid." The plaintiff does not allege the existence of an agreement between the parties sufficient to supp01t a cause of action for specific performance (see Brois v DeLuca, 154 AD2d 417, 546 NYS2d 3 [2d Dept 19891). More importantly, the plaintiff docs not address the issue raised in this branch of the defendant's motion in her opposition. New York Courts have held that the failure to address arguments proffered by a movant or appellant is equivalent to a concession of the issue (see McNanzee Constr. Corp. v City of New Rocltelle, 29 AD3d 544, 817 NYS2d 295 [2d Dept 2006]; Welde11vRivera , 301AD2d934, 754 NYS2d 698 (3d Dept 2003J; Hajderlli v Wiljolm 59 LLC, 24 Misc3d J 242A, 2009 NY Slip Op 51849U rsup Ct, Bronx County 2009]). Here, the defendant has failed to established her prima facie entitlement to summary judgment dismissing the plaintiffs first, second, third, and fifth causes of action. The failure to make such prima facie showing requires a denial of the motion, regardless of the sufficiency of the opposing papers (see Alvarez v Prospect Hosp., supra; Winegrad v New York Univ. Med. Ctr. , supra: Matinez v 123-16 Liberty Avenue. Real(y Co11J., 47 J\D3d 901 , 850 NYS2d 201 [2d Dept 2008]). To the extent lhat the plaintiff's opposition lo the defendant's motion is necessary, it fails to raise an issue of fact which would preclude the granting of summary judgment dismissing her fourth and sixth causes of action. In opposition, the plaintiff submits her affidavit, the transcript of her deposition testimony, a copy of the 2004 deed, an unauthenticated copy ofa mortgage note dated February 10, 2004 purportedly executed by the defendant 0111 behalf of L ' Etoile, Ltd. and as guarantor, and two unaut11enticated documents purportedly from the New York State Department of State, Division of Corporations regarding L'Etoilc, Ltd. It is a prerequisite to the admission of a private docLm1ent offered in evidence by a pm1y to an action that the authenticity and genuineness of the document be established (see Horowitz v Kevalt Ko1t11er, Inc., 67 AD2d 38, 414 NYS2d 540 [1st Dept 1979]; Prestige Fabrics v Novik & Co., 60 AD2d 517, 399 NYS2d 680 f lst Dept 1977]). Similarly, it is a prerequisite to the admission of official records of a court or government office offered in evidence by a party to an action that the [* 8] Mouzakiotis v. Mouzakiotis Index No.: 11682/2013 Page 8 document be authenticated as being what it purports to be in order to be admissible under exceptions to hearsay rule (CPLR 4540; People v Ricks, 71 AD3d 1444, 899 NYS2d 756 [4th Dept 20 l O]). Thus, the subm itted mortgage note and corporate records are inadmissible, and have not been considered by the Court in making this detennination. Even if deemed admissible. said documents do not resolve the issues or fact herein. Finally, the plaintifPs affidavit and her deposition testimony do not address the issues raised in the defendant's motion regarding conversion and specific performance, and neither raises an issue of fact regarding the causes of action relating to those claims. f n addition, the plaintif'fhas not crossmoved for dismissal of the defendant's counterclaim. Under the circumstances, the defendant's request to sever and continue her counterclaim is academic. Accordingly, the defendant's motion for summary judgment is granted to the extent that the plaintifrs fourth and sixth causes of action arc dismissed. The Court directs that the causes of action as to which summary judgment was granted arc hereby severed and that the remaining causes of action shall continue (see CPLR 3212 Le] fl l). Dated ~ ;}.~ ) 0/ J ~ 6.fldtL·· J.S.C. HON. WILLIAM B. REBOLINI, _ _ _ FINAL OISPOSITION_.....: -"---_ NON-FINAL DISPOSIT ION X
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