NYCTL 2018-A Trust v Keshia Realty Corp.
Annotate this CaseDecided on June 27, 2022
Supreme Court, Bronx County
NYCTL 2018-A Trust, et al., Plaintiffs,
against
Keshia Realty Corp., et al., Defendants.
22893/2019E
Adrian Armstrong, J.
In this tax lien foreclosure matter, the issue of the distribution of the surplus funds after the foreclosure sale of the subject property is before this court. Keshia Realty Corp. ("Keshia") seeks an order directing the New York City Department of Finance to distribute 100% of the foreclosure surplus money to it and to confirm the Referee's Report of Sale.
This action was commenced in 2019 to foreclose on certain liens on a certain property located in Bronx County, New York. The report of sale of the Referee, Louis Joseph Russo III, Esq. was duly filed in the Office of the Clerk of the County of Bronx on September 11, 2020. The report indicates that after paying the amount directed in and by said judgment to be paid out of the proceeds of the sale, there remained a surplus in the amount of $1,880,430.45, which amount was paid into the court to the credit of this action by said Referee after he received the same and as appears from the Treasurer of the County of Bronx. Thereafter those funds were transferred to the New York City Department of Finance. No exceptions had been filed against the report of sale as appears from the certificate of the Clerk of the County of the Bronx, dated February 24, 2022.
Keshia filed a Notice of Claim to the surplus monies, dated January 7, 2020. Keshia makes its claim to the surplus moneys in this matter as the prior owner of the foreclosed upon property. Ramo Figueroa as the Administrator of the Estate of Marcelino Roqué also filed a Notice of Claim to the Surplus Money, dated [*2]January 7, 2020, based on a claim the Marcelino Roqué a/k/a Michel Roqué was the sole shareholder of Keshia and that his Estate was entitled to 100% of the surplus funds.
The attorneys for Ramo Figueroa filed with this court on February 24, 2022 a purported Withdrawal of Notice of Claim to the Surplus Money, the correspondence also indicated that Ramon Figueroa was withdrawing as Administrator for the Estate of Marcelino Roqué. As of this date, no such withdrawal has been determined or ordered by Surrogate's Court in Bronx County.
The court may take judicial notice of matters of public record, such as an "incontrovertible official document" or other "reliable documents, the existence and accuracy of which are not disputed," (Brandes Meat Corp. v Cromer, 146 AD2d 666, 667 [2nd Dept 1989]). This includes "the indisputable public records of the Secretary of State," showing corporations' incorporation and dissolution (Id. at 667). All entities conducting business as corporations must register with the New York State Department of State's Division of Corporations. NY Bus. Corp. Law §§ 402(a), 403. The Division of Corporation's registrants are in public records, accessible to the court from the Division's electronic database. That public database shows that Keshia's date of initial filing was March 12, 1990 and the corporation was dissolved by proclamation on September 28, 1994. The corporation remains inactive to date.
Statutory dissolution by proclamation of the Secretary of State pursuant to Tax law § 203-a is intended to encourage voluntary payment of franchise taxes (see Bowditch v 57 Laight St. Corp., 111 Misc 2d 255 [New York County 1981]). After dissolution, a dissolved corporation has no existence, either de jure or de facto, except for a limited de jure existence for the sole purpose of winding up its affairs (see Lorisa Capital Corp. v Gallo, 119 AD2d 99, 109-111 [2nd Dept 1986]).
There are no guidelines that this court could find as to how long is "limited" and what constitutes "winding up." However, claiming surplus funds in a court proceeding almost 18 years after dissolution just does not sound like a limited winding up of affairs. In the final analysis, a corporation that ceases to operate, stops paying taxes, and dissolves for almost two decades, is not "winding up its affairs." Its affairs should have already been wound up.
The Supreme Court and the Surrogate's Court have concurrent jurisdiction over the administration of a decedent's estate (see Goodwin v Rice, 79 AD3d 699, 699-700 [2nd Dept 2010]). "However, '[w]herever possible, all litigation involving the property and funds of a decedent's estate should be disposed of in the [*3]Surrogate's Court' " (Cipo v Van Blerkom, 28 AD3d 602 [2d Dept 2006], quoting Nichols v Kruger, 113 AD2d 878, 878-879 [2nd Dept 1985]). This Court is aware that the Estate of Marcelino Roqué has an action pending in Bronx Surrogate's Court seeking to resolve the affairs of the estate and its administration, and that Mr. Figueroa is still the administrator. As such, determination of this action "affects the administration of a decedent's estate" (CPLR 325 [e]). Accordingly, this Court is exercising its power under article VI, §19 (a) of the New York Constitution to transfer this matter to the Surrogate's Court, Bronx County. For the foregoing reasons, and in the interests of justice, the unopposed relief sought in the motion before the court is partially granted.
Accordingly, it is hereby
ORDERED that the Referee's report dated September 11, 2020 is affirmed; and it is further
ORDERED that Keshia Realty Corp.'s motion for 100% of the foreclosure surplus money is denied; and it is further
ORDERED that this action is removed to the Surrogates Court, Bronx County pursuant to CPLR 325 (e).
This is the Decision and Order of the Court.
Dated: June 27, 2022
_____________________________
Adrian Armstrong, A.J.S.C.
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