Matter of Yoon (Pae)

[*1] Matter of Yoon (Pae) 2017 NY Slip Op 50078(U) Decided on January 12, 2017 Surrogate's Court, Queens County Kelly, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 January 12, 2017
Surrogate's Court, Queens County

Proceeding by Elizabeth Pae, as Administrator of the Estate of Andrew Yoon, Deceased, to Discover Property Withheld.



2015-1000/C



Tae Oon Jang, Esq.

Attorney for Respondent

Joseph A. Ledwidge, Esq.

Attorney for Petitioner
Peter J. Kelly, J.

Petitioner in this SCPA 2103 discovery proceeding moves, inter alia, for partial summary judgment. Respondent has filed opposition to the motion.

Andrew Yoon unexpectedly died in a drowning accident on January 29, 2015. His mother, the petitioner, was granted letters of administration in his estate.

Petitioner commenced this discovery proceeding against respondent, seeking, inter alia, the return of a card game called "Divorce, The Game" (hereinafter "the game"), together with an order directing respondent to account for all of respondent's previous "dealings and transactions" of said property, as well as the restoration of all original contents, email/phone contacts, and log-in identifications and passwords which were in existence prior to the decedent's death of all web-sites for the game linked to various internet, game marketing and advertising companies, as well as costs and attorney fees.

The inquiry of respondent was held on December 17, 2015 and January 13, 2016 and respondent filed an answer which contained, inter alia, an "affirmative" defense that the decedent and the respondent were business partners and that respondent, as a surviving partner, is entitled to one-half of the value of the business as of the date of the decedent's death.

After completing discovery, petitioner made the instant motion pursuant to CPLR 3212 to dismiss respondent David Beck's "claims, as an alleged surviving partner" to the game, and in connection therewith an order:

directing respondent David Beck to (i) return to petitioner...all the units of the Game in his possession or control; (ii) return to petitioner all proceeds of sale received by him and his limited liability company from their sales of the Game, [*2]together with statutory interest on all such amounts; (iii) return to petitioner of all the drawings, contents and designs of Andrew Yoon relating to the Game; (iv) account for all his dealings, sales, and transactions with respect to the Game; (v) restore to the Estate of Andrew Yoon the website divorcethegame.com and all websites for the Game linked to Kickstarter, Inc., Amazon.com, Inc., twitter, Facebook, and any other game marketing and advertising companies, and (vi) return to petitioner all passwords and user names for said websites and all passwords and user names of the decedent relating to the Game.

The motion also seeks leave to amend the petition pursuant to CPLR 3025(b) to include a demand for an award of punitive damages against respondent; to correct the year in the last line of paragraph 6 of the petition from 2011 to 2010; an award of reasonable attorneys' fees and costs and disbursements; and for such other and further relief as the Court may deem just, proper and equitable in the circumstances.

The first branch of the motion seeks dismissal of respondent's claims to the game as an alleged surviving business partner. In order for petitioner to obtain summary judgment, she must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate that the decedent was the owner of the game at the time of his death and that there was no partnership in existence between the decedent and respondent [see Ayotte v Gervasio, 81 NY2d 1062; CPLR 3212 (b)].

A partnership is an association of two or more persons to carry on, as co-owners, a business for profit [Partnership Law 10(1)]. Where there is no written partnership agreement between the parties, the court must determine whether a partnership in fact existed from the conduct, intention and relationship between the parties (Czernicki v Lawniczak, 74 AD3d 1121). Factors to be considered in determining the existence of a partnership include (1) sharing of profits, (2) sharing of losses, (3) ownership of partnership assets, (4) joint management and control, (5) joint liability to creditors, (6) intention of the parties, (7) compensation, (8) contribution of capital, and (9) loans to the organization (Czernicki, supra; see Brodsky v Stadlen, 138 AD2d 662). No one factor is controlling, as the court is to look at the relationship of the parties as a whole (Fasolo v Scarafile, 120 AD3d 929).

In support of her motion, petitioner submits the following. The decedent, a former editor-in-chief at Shacknews and Joystiq, created and designed a card game named "Divorce! The Game." The decedent hired an artist and graphic designer to do the art work and graphic design work for the game, executed consulting agreements with them and paid them for their services from his personal bank account.

Decedent also executed a consulting agreement with the respondent (Exhibit "I"), which provided that "...all documents, magnetically or optically encoded media, and other tangible materials created by Consultant as part of its services under this Agreement shall be owned by the Contractor." It also provided that respondent was to produce a Kickstarter pitch video, including filming and editing, and assist in the general production of "Divorce! The Game," including "playtesting, copywriting, and editing," and that the respondent would receive, as compensation, 30 cents for every copy of "Divorce! The Game" sold through Kickstarter.

On October 3, 2014, respondent sent the decedent an invoice for $208.20 indicating that 694 units were sold during the Kickstarter campaign. The decedent paid respondent, via Paypal, $208.20 on October 14, 2014, as evidenced by the invoice and PayPal statement (Exhibit "J").

An addendum to the consultation agreement dated January 15, 2015, two weeks before the decedent's death, provided that in the event petitioner "...sells his rights to "Divorce! The Game" to a third-party, respondent would receive 20% of the gross profits received from the sale. The parties agree that the rights to the game were never sold to a third party.

Petitioner also annexed to her motion papers portions of respondent's depositions held on December 17, 2015 and January 13, 2016, wherein respondent testified that he and the decedent allegedly "shook" on an oral agreement for a partnership a day before the decedent's sudden death and that the agreement was not in writing. Respondent further testified that the decedent was the designer of the game; that the decedent owned the rights to the game prior to his death and at the time of his death; that the decedent never assigned any of his rights or interests in the game to respondent or to any alleged partnership between the decedent and himself; the alleged partnership never obtained a taxpayer identification number; the alleged partnership never filed partnership tax returns; that respondent did not have a business certificate filed with the Queens County Clerk or any other county clerk nor was he in possession of any certificate of assumed name filed with the Queens County Clerk; that respondent is not in possession of any documents which refer or relate to any capital accounts for the alleged partnership; that a partnership bank account was never opened; that there was no sharing of profits or losses between decedent and respondent; and that all terms of the alleged partnership, other than an asserted 50-50 ownership split, was "...left to wait until we had spoke to lawyers."

Petitioner also annexed to her motion papers copies of shipping documents for the game, authenticated by respondent, which list the decedent as the consignee and owner of the game (Exhibit H); copies of decedent's checking account statements showing payment to Wingo Industry Ltd. for production costs of the game (Exhibit F); photocopy of the box for the game and instruction sheet therein indicating that the game was "(c) Copyright 2015 Andrew Yoon" (Exhibit G); and results of a search for a business certificate filed with the Queens County Clerk which showed records of an "anyo" or "anyo Publishing" (the alleged name of the partnership) did not exist (Exhibit M).

While some of the aforesaid documents do in fact refer to a company name "anyo,"[FN1] only the decedent is named as the owner thereof and there is no mention of respondent. Indeed, a U.S. Customs Power of Attorney compled by the decedent on January 12, 2015, only 17 days prior to his death, annexed as part of Exhibit H, states that "anyo" consisted solely of the decedent acting as an individual and that it was not a [*3]partnership or corporation.

It is clear that petitioner met her initial burdens of establishing, prima facie, that a partnership did not exist (see Fasolo v Scarafile, 120 AD3d 929; 120 Cleland v Thirion, 268 AD2d 842) and that the decedent was the sole owner of the game. It is, thus, incumbent upon the respondent to produce evidentiary proof, in admissible form, to raise a material issue of fact (Matter of Seelig, 302 AD2d 721).

In opposition to the motion, respondent asserts that he and the decedent developed the concept for the game and, working together, modified the game mechanics and developed a prototype. He further alleges that he purchased supplies necessary for the prototypes and purchased food for participants in the playtests and, beginning in August, 2014, they began "hashing out" the terms of a partnership between them, but "...they did not have the opportunity to formalize the anyo partnership before Yoon died."[FN2]

Respondent also alleges that he "furnished the partnership's workspace" based on the fact that decedent and respondent lived and worked out of a house owned by respondent's mother without the imposition of rent, and that he "paid for the postage account to ship the copies of games through Kickstarter as well as a digital scale and packing materials" and that these expenses were not reimbursed. Respondent contends that all of these expenses constitute contribution of capital to the partnership and, thus, constitute evidence of the existence of the partnership. He also states that the risk of loss on offering a promotional strategy of "repossession" fell disproportionately on him and not the decedent.[FN3]

Viewing respondent's contentions in the best possible light, it is apparent that, other than respondent's own testimony, there is not one scintilla of evidence supporting his claim of the existence of a partnership. There is no writing evidencing the existence of a partnership and, as even respondent acknowledged, respondent's name does not exist on a certificate of doing business as partners (see, General Business Law § 130 [1] [a]; 15A NY Jur 2d, Business Relationships, § 1422, at 371). No partnership tax returns were ever filed, there never was any sharing of profits or losses, nor is there any evidence of joint management and control or joint liability to creditors. Indeed, the proof shows all major decisions were made by the decedent. Additionally, respondent did not produce any evidence that the rights to the game were ever transferred by the decedent to any alleged partnership.

With respect to respondent's alleged "capital contributions," all were made during the time of the consulting agreement and months prior to the claimed formation of the [*4]alleged oral partnership agreement on January 28, 2015. At most, the proof indicates that the decedent and respondent were roommates and the decedent employed the respondent as a consultant in a venture to test and ultimately mass produce a board game. There is absolutely no credible proof that the decedent ever intended to create a partnership with the respondent, much less the actual formation of one (Czernicki, supra; Fasolo, supra; F & K Supply, Inc. v Willowbrook Dev. Co., 304 AD2d 918).

Additionally, the vast majority of respondent's testimony is violative of the dead person's statute (CPLR 4519). Such evidence can be considered in opposition to a motion for summary judgment so long as it is not the sole evidence proffered (Miller v Lu-Whitney, 61 AD3d 1043; Phillips v Kantor & Co., 31 NY2d 307). Here, however, as it is the only evidence offered in opposition by the respondent, it cannot be used to defeat summary judgment.

Accordingly, the first branch of petitioner's motion is granted and respondent's first affirmative defense is dismissed. As the decedent's estate is the owner of the game, the appurtenant relief requested in the motion and petition for the turnover of the game, the drawings, contents and designs of the decedent relating to the game is granted. Respondent shall turnover all aforesaid items within twenty days of this decision and order. Respondent shall also restore to petitioner control of all websites relating to the game and return to petitioner all passwords and usernames for said websites within said twenty days of this decision and order.

Although petitioner is entitled to the proceeds of sale from the sale of the game, the papers submitted on the motion and in opposition thereto do not address the amount of damages. Accordingly, that branch of the petition is granted to the extent that this issue is set down for an inquest, to be held on the14th day of February, 2017 at 10:00 AM.

The branch of the petition requesting an account from the respondent for all his dealings, sales and transactions with respect to the game is denied. Any such accounting would be obviated by the aforesaid inquest on damages regarding the proceeds of the sale of the game.

The second branch of petitioner's motion seeks leave to amend the petition to include a demand for an award of punitive damages. Respondent also opposes this branch of the motion.

A claim for punitive damages is not a separate cause of action (Rocanova v Equitable Life Assur. Soc. of U.S., 83 NY2d 603; Rose Lee Mfg., Inc. v Chemical Bank, 186 AD2d 548). If the pleading states facts authorizing the award of such damages, it is not necessary that they be specifically demanded (Weir Metro. Amb. Serv. Inc. v Turner, 57 NY2d 911; Kathleen Foley, Inc. v Gulf Oil Corp., 12 AD2d 644, a'ffd 10 NY2d 859). Thus, it would not appear to be necessary to amend the petition. Additionally, punitive damages are not available absent sustainable compensatory damages (Hubbell v Trans World Life Ins. Co. of New York, 50 NY2d 899). As compensatory damages would be determined after the aforesaid inquest, the second branch of petitioner's motion is denied without prejudice to renew at the proper time.

The branch of petitioner's motion seeking leave to amend the petition to correct the year in the last line of paragraph 6 of the petition from 2011 to 2010 is granted without opposition.

The final branch of petitioner's motion seeks the imposition of "...her reasonable attorneys' fees and costs and disbursements. Attorneys' fees can be imposed upon a party either by statute or by contract. The consulting agreement herein provides that should either party resort to legal proceedings in connection with the agreement or the consultant's (respondent) relationship with the contractor (decedent), the prevailing party shall be entitled to recover its reasonable attorney's fees and costs of such legal proceedings from the non-prevailing party.

Petitioner's moving papers, however, fail to establish, prima facie, entitlement to an award of attorney fees under the fact pattern herein. Petitioner has not provided an affidavit setting forth the legal services rendered which would enable the Court to apply the factors set forth in Matter of Freeman (34 NY2d 1) and Matter of Potts (213 A.D. 59). Accordingly, this branch of the motion is denied.

The parties are directed to appear for a pre-trial conference on February 14, 2017 at 9:30 AM.

This is the decision and order of the Court.

Dated: January 12, 2017

________________________

SURROGATE Footnotes

Footnote 1:While respondent indicates that the word "anyo" means "hello" in Korean, the Court notes that the word consists of the first two letters of the decedent's first and last names.

Footnote 2:In his papers in opposition to the motion, respondent avoids any mention of the handshake agreement allegedly made a day before the decedent's death that he testified to at his deposition.

Footnote 3:The promotional strategy was to offer any investor of $10,000.00 or more to go to respondent's mother's house and claim any item in the house as their own, in much the same way a player of the game could "repossess" any of his opponent's game property. No investor took up the offer.