Fidelity Natl. Title Ins. Co. v Heights Abstract LTD

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Fidelity Natl. Title Ins. Co. v Heights Abstract LTD 2017 NY Slip Op 33171(U) November 29, 2017 Supreme Court, Westchester County Docket Number: Index No. 60503/2017 Judge: Terry Jane Ruderman Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. [*FILED: 1] WESTCHESTER COUNTY CLERK 12/01/2017 10:07 AM NYSCEF DOC. NO. 41 INDEX NO. 60503/2017 RECEIVED NYSCEF: 11/30/2017 To commence the statutory time for appeals as of right (CPLR 55 13[a]), you are advised to serve a copy of this order, with notice of entry, upon all parties. SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF WESTCHESTER --------------------------------~---~--------------------------~--" FIDELITY NATIONAL TITLE INSURANCE COMPANY, Piaintiff, DECISION and ORDER t Matian Sequence No.. 1 Inde" No.. 60503/2017 -againstHEIGHTS ABSTRACT LTD".,RICHARD SENEY, RICHARD SENEY GENERAL CONTRACTING, INC., and RICHARD SENEYREAL ESTATE, LLC, Defendants. ----------------------------------------------------------~-------" ./ RUDERMAN, J. The fallawing papers were cansidered in cannectian with the matian far an arder dismissing the camplaint pursuant to. CPLR 3211(a)(7): Papers Natice afMatian, Affirmatian, E"hibits A:- F, Affidavit, E"hibitsA - E, and Memarandum of Law Affirmatian in Oppasition, E"hibits 1 - 3, Affidavit; E"hibits A ~E, and Memarandum af Law Numbered 1 2 In this acti~n braught by Fidelity Natianal Title Insurance Campany ("Fidelity"), to. recaup amaunts paid an a title insurance policy Glaim,defendants Richard Seney, Richard Seney General Contracting, Inc., andlRichard Seney ,Real Estate, LLC (the "Seney defendants") mave to. dismiss the actian as barred lJY the statute af limitatians and, as to. the claim for legal fees, pursuant to.the dactrine af callateral estappel. Fidelityappases. 1 I ~ 1 of 5 Defendant Heights Abstract, [*FILED: 2] WESTCHESTER COUNTY CLERK 12/01/2017 10:07 AM NYSCEF DOC. NO. 41 INDEX NO. 60503/2017 RECEIVED NYSCEF: 11/30/2017 / Ltd., has not taken a position on this motion According to Fidelity's complaint: on or about November 30, 2001, Richard Seney General Contracting, Inc. ("Seney Contracting") obtained title to the property known as 173 . ~ r . / Aquequct Place, a/k/a 162-164 Fulton Street, in Greenburgh, New York. On or about July 27,2007, Seney Contracting obtained a $100,000 loan from Hudson Valley Bank, which Fidelity alleges was secured by a mortga~ against the property; Seney asserts that the loan was pursuant to a line of credit and was not secured by a mortgage. < • On or abOl.itJuly 15,2008, Seney Contracting purportedly transferred the property to the '> newly-formed Richard Seney Real Estate LLC ("Seney Real Estate"); ho~ever, the deed incorrectly identified the transferor as Richard Seney Contracting LLC, rather than the correct <, transferor, Richard Seney Contracting Inc. On the same date, Seney Real Estate obtained a $680,000 loan from Connecticut Community Bank, N.A. ("CCB") secured by a mortgage on the l property. In connection with this transaction, Fidelity's authorized agent, defendant Heights Abstract ,Ltd., issued to CCB a Loan Policy of Title Insurance. Seney Contracting defaulted on the Hudson Valley Bank loan, and on or about February l 25,2011, Hudson Valley Bank obtained a default judgment against Seney and Seney Contracting in the 'amount 0[$122,090.87. Seney Real Estate defaulted on the CCB loan. In the course of preparing to commence a foreclosure action,'CCB discovered tl1atthe deed to Seney Real Estate was not executed by ) < Seney Real Estate, 'and that the only sigriature was by Richard Seney for Richard Seney Contracting LLC as transferor. CCB made a claim under its title insurance policy with Fidelity. I CCB commenced the foreclosure action against Seney Real Estate, and Hudson Valley Bank filed an answer with acounterclaim asserting priority over the CCB mortgage and to 2 2 of 5 [*FILED: 3] WESTCHESTER COUNTY CLERK 12/01/2017 10:07 AM NYSCEF DOC. NO. 41 INDEX NO. 60503/2017 RECEIVED NYSCEF: 11/30/2017 declare the CCB mortgage void on account of a fraudulent transfer. '. . , Hudson Valley Bank also sued Seney, Seney Contracting and Seney Real Estate on the ground that the July 15, 2008 deed to Seney Real Estate was a fraudulent conveyance. Under the terms of its title insurance policy, Fidelity settled CCB' s title claim and resolved Hudson Valley Bank's counterclaim in the CCB foreclosure by payment of$25,000. Fidelity claims that it expended $87,135.79 in attorney's fees and costs due to the Seney defendants' fraudulent conduct andtheir breach ofthe provisi,on iIithe CCB mortgage documents promising to protect and preserve the priority of the CCB, mortgage; as against defendant Heights Abstract Ltd. it claims negligence,and violation of its obligations under the Agency Agreement with Fidelity, by failing to adequately scrutinize the deed to Seney Real Estate to verify that it correctly identified the participants and was a'bona fide transaction, . \ . supported by adequate consideration .. The complaint's causes of act~on against the Seney defendants ~e unjust enrichnientand indemnification; against Heights Abstract,it claims breach of contract and indemnification. This motion, btought by theS~ney defendants, argues that the causes of action against , them for unjust enrichment and'indemnification are barred by the statute of limitations, and, to the ext~nt Fidelity claims entitkment to an award for legal fees, they seek dismissal under the doctrine of collateral estoppel. Analysis Defendants contend that Fidelity is in effect suing for fraudulent conveyance, which claim is untimely because the complained-of conveyance occurred nine years after the property " ' ,.- transfer, and two years after Fidelity should have discovered the fraud. However, Fidelity's pleaded claims are for common law indemnification and unjust enrichment~ 3 3 of 5 [*FILED: 4] WESTCHESTER COUNTY CLERK 12/01/2017 10:07 AM NYSCEF DOC. NO. 41 INDEX NO. 60503/2017 RECEIVED NYSCEF: 11/30/2017 . "A cause of action fof indemnification accrues when the injured party ... has been paid (Loscalzo v Lupinacci, 275 AD2d 349, 350 [2d Dept 2000], citing McDermott v City of New York, 50 NY2d211, 219 [1980]). The basis for Fidelity's indemnification claim againstthe _Seney defendants is the loss payment it made in 2015. Therefore, this cause of action, in a complaint filed on Juli14, 2017, is not barred by the statute oflimitations. The statute of limitations on an unjust enrichment cause of action may be six years or three years, dep~nding on whether the plaintiff is seeking monetary, as opposed to equitable, relief (see Ingrami v Rovner, 45 AD3d806, 808 [2d Dept 2007]). Fidelity argues that the Seney defendants were not unjustly enriched until November 2015, when Fidelity paid Hudson Valley Bank in order to provide CCB with the first priority mortgage security interest iIi the property, as Seney Real Estate agreed to provide when it granted CCB a mortgage interest in the property. Therefore, this cause of action, too, is timely. The argument that the doctrine of collateral estoppel bars Fidelity from seeking to recover for legal fees it incurred must also be rejected. "The doctrine of collateral estoppel, a narrower species of res judicata, precludes a party from relitigating in a subsequent action or proceeding an issue clearly raised in a prior action or proceeding and decided agail1st that party . . ( or those in privity, whether or not the tribunals or causes of action are the same" (Ryan v New York Tel. Co.,62 NY2d494, 500 [1984]). The fact that CCB, Fidelity's insured, recovered attorney's fees incurred in the context of the foreclosure action, qoes not preclude another party from seeking to recoup attorney's fees for different work not covered by the foreclosure action award of fees; Fidelity' ~ privity with CCB is irrelevant here . ., Accordingly, it is hereby ORDERED that defendants' motion to dismiss the complaint is denied in its entirety; and 4 4 of 5 [*FILED: 5] WESTCHESTER COUNTY CLERK 12/01/2017 10:07 AM NYSCEF DOC. NO. 41 INDEX NO. 60503/2017 RECEIVED NYSCEF: 11/30/2017 it is further ORDERED thatall parties are directed to appear in the Preliminary Conference Part on Monday, January 22,2018 at 9:30 a.m., at the Westchester County Courthouse located at 111 \ Dr. Martin Luther King Jr. Boulevard, White Plains, New York, 10601. This constitutes the Decision and-Order of the Court. Dated: White Plains, New Yark November~, 2017 , I - 5 5 of 5

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