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Richard A. Klass
Cases of Note: Appeals and Decisions
Hamilton Federal Savings & Loan Association v. Shayet, Index No. 29058/85 (Sup. Ct., Kings Co. 2000), In an action for the turn-over of abandoned property in the hands the New York State Comptroller pursuant to CPLR Article 26 and Abandoned Property Law §1406, parties settled after submission of motion to court. In a mortgage foreclosure action, surplus moneys from the auction sale of the real property were deposited into court. The Internal Revenue Service filed a federal tax lien on April 1, 1985, which, according to IRC §6502(a), expired ten years afterwards on March 31, 1995. In January 2000, the owners of the real property applied to the court to obtain the turn-over of the surplus moneys; the Internal Revenue Service opposed the application, claiming that its federal tax lien attached by operation of law, from the lien on the real property to a lien on the surplus moneys from the sale of such real property, and that the tax lien survived. The settlement reached with the Internal Revenue Service was for the payment of $100,000 towards the IRS lien, and the balance to the clients, namely: $388,438.90.
Qualified as arbitrator of attorney-client fee disputes pursuant to Part 137 of the Rules of Court.
In re Severius Raggie, 389 BR 309, NYLJ 7/9/08 (EBNY 2008).
Bobroff v. Sallie Mae Servicing and Educational Credit Management Corp., Adv. Proc. No. 04-1252-jf (EDNY 2005). Adversary Complaint filed by Debtor to discharge medical school student loans due to "extreme hardship." "Extreme hardship" is the legal standard by which a debtor may seek to discharge an otherwise non-dischargeable student loan under Bankruptcy Code §523. Two years after becoming a physician, Debtor suffered a nervous breakdown and, ultimately, became eligible for permanent social security disability benefits. The lender agreed to discharge the student loans prior to trial.
Badillo v. Fazal and City Marshal Rose, Index No. 23511/94 (Sup. Ct., Bronx Co. 1998), In a case of first impression, Supreme Court, Bronx County determined that City Marshals do not have an affirmative duty to conduct a search of Uniform Commercial Code [UCC] liens prior to conducting a public auction pursuant to a Property Execution.
Belin v. Midtown Enterprises, Index No. 34671/98 (Sup. Ct., Kings Co. 2001). In the trial of a tort action against a City Marshal and a towing company for allegedly injuring the plaintiff by ramming and lifting his vehicle, the court granted judgment as a matter of law with respect to the City Marshal, since the plaintiff failed to prove that the Marshal owned or operated any of the involved vehicles, or held direct supervisory control over the operators of the vehicles.
Scholfield v. Scholfield, New York Law Journal, February 2, 1998 (App. Term, 2d &11th Judicial Districts, 1998), unanimously reversed decision of the Civil Court, Kings County, based upon the general legal principle that an action for accounting of a partnership asset is an equitable action which must be heard in a court of general jurisdiction [i.e. Supreme Court], and may not be heard in the Civil Court of the City of New York, a court of limited jurisdiction.
American Express Travel Related Services Co v. Sarf, New York Law Journal, July 20, 2005, page 20 (Supreme Ct., Nassau Co.). In granting summary judgment against the credit card holder, the court disregarded the unsworn responses to a Notice to Admit submitted by his attorney as not submitted by a party. Also, the court determined that the unsworn responses were inadequate to refute the account statements because 15 USC 1666(a) provides that, within sixty days of receiving statements of account in a consumer credit transaction, an obligor must send a written notice indicating his belief that the statement may contain errors (which did not happen in this case).
335 Second Street Housing Corp. v. Fridal Enterprises, Inc., 36 AD3d 608, 830 NYS2d 173 (2d Dept. 2007). The Supreme Court correctly determined that the defendant engaged in a course of conduct over a period in excess of nine years whereby it affirmatively billed the plaintiff at an interest rate lower than that authorized by the parties' agreement, and acquiesced in the plaintiff's payments at that rate without complaint, objection, or the declaration of a default. Moreover, the evidence submitted on the motions established that the defendant's conduct induced the plaintiff's reasonable belief that the higher rate would not be imposed, and that the plaintiff relied upon that conduct to its detriment in refraining from seeking a more advantageous financing agreement. Accordingly, the Supreme Court properly granted summary judgment to the plaintiff on the basis of equitable estoppel. In analyzing the doctrine of equitable estoppel, the Court considered the elements delineated in the Matter of N.Y. State Guernsey Br. Co-op v. Noyes, 260 AD 240 (3d Dept. 1940), modified on other grounds, 284 NY 197 (1940), as follows:
Callender v. Titus, 4 Misc.3d 126(A), 791 NYS2d 868 (App. Term, 2d &11th Judicial Districts 2004). In a post-occupancy rent arrears action, the court determined that the landlord had no duty to mitigate his damages by reletting the premises after the tenant vacated, and the landlord was entitled to claim rent owed pursuant to the lease.
Galster Management Corp. v. D'Ambrose, Index No. 307/98 (Sup. Ct., Queens Co. 2000). In connection with the satisfaction of a Promissory Note, the lender erred in calculating the amount due from the borrower at closing, and issued a pay-off letter for the wrong figure. After learning of the mistake post-closing, the lender advised the borrower of the mistake, to which the borrower claimed that he was not liable, as the lender had made a unilateral mistake. The court determined that, as there was no legitimate dispute between the parties, there could be no allegation of an "accord and satisfaction," and the borrower would be unjustly enriched by the error, the lender was entitled to judgment for the balance actually due on the Note.
LOMTO Brokerage v. Sanderson, Index No. 51480/00 (Civil Ct., Kings Co. 2001). Pursuant to Insurance Law ß2119, action against taxi medallion owner brought by an insurance broker for unpaid premiums was dismissed as a matter of law since the insurance broker failed to obtain a written memorandum from the party to be charged.
Korzeniewski v. Estate of Poswolsky, Index No. 13819/2004 (Sup. Ct., Nassau Co. 2007). A motion was brought for summary judgment in favor of the buyer of real property, seeking specific performance of the contract of sale. Attached as part of the proof in support of the motion was the petition filed by the executor of the seller with the Surrogate's Court, in which he indicated that the value of the house was $500,000 at the time of death (less than 10% more than the sale price of $465,000 negotiated four months earlier). In response, the executor put forth two proofs that his father was suffering from dementia and, therefore, lacked the mental capacity to sign the Contract of Sale, namely: (a) the medical records from Nassau University Medical Center (where the notations of dementia appeared in the records); and (b) the affidavit of a neurologist who neither examined the decedent nor consulted with any of his personal physicians, but relied solely upon the medical records which post-dated the signing of the Contract of Sale. In granting summary judgment to buyer, the judge enforced the terms of the Contract to make the executor "specifically" perform the contract and sell the property for the original sale price. Relying upon case law, the judge found that the buyer proved that he "substantially performed [his] contractual obligations and was willing and able to perform the remaining obligations, that defendant was able to convey the property, and there was no adequate remedy at law."
In disregarding the executor's proofs, the judge found that he did not meet his burden of proving that the decedent was incompetent (in order to refute the presumption that people are considered mental competent and capable of making a contract). According to well settled law from the NYS Court of Appeals (Ortelere v. Teachers' Retirement Board), the focus of the inquiry is whether the person's mind was so affected as to render him wholly incompetent to comprehend and understand the nature of the transaction at issue. In this case, the executor did not offer any proof that his father was so affected by dementia that he was unable to enter into the contract. Further, there was no proof that he was forced or coerced into signing the contract.
The Silver Company v. ACIRFA, Inc., 7 Misc.3d 1004 (Sup. Ct., Kings Co. 2005). There were two Mortgages on a property in Brooklyn, one given by the US Department of Housing and Urban Development (HUD) in 1983 and one given by Nevmar Construction Corp. in 1988. In 1990, Nevmar brought a foreclosure proceeding in connection with a default under its Mortgage, and obtained a Judgment of Foreclosure and Sale in 1991. However, Nevmar elected not to auction the property but, rather, to leave the Judgment of record against the property (primarily, because the Mortgage granted to HUD was near the then-value of the property and Nevmar would have been foreclosed from obtaining any surplus moneys. In 1993, Nevmar assigned its Judgment to The Silver Company, and the Assignment of Judgment was docketed with the County Clerk. In 1999, the HUD Commissioner brought a non-judicial foreclosure pursuant to 12 USC §3751 against the property. In that proceeding, the HUD Commissioner served notice of the non-judicial foreclosure only upon the original judgment creditor, Nevmar, and not upon the assignee, The Silver Company. As a result, the assignee’s interests in the property were not cut off. The court determined that, in order to terminate the judgment holder’s interest in the property, the property owner who bought the property at the HUD foreclosure sale had to bring a strict foreclosure proceeding (within which the assignee would have a certain fixed period of time to pay off the buyer’s bid amount with interest and stand in his shoes vis-à-vis the property). Given the quadrupling of the value of the property, the title insurance company of the property owner settled the case by paying almost the entire amount of the Judgment of Foreclosure.
Boro Medical & Psych Treatment Services v. Travelers Property Casualty Corp., New York Law Journal, March 29, 2001, at page 23 (Civil Ct., Kings Co. 2001). In an action brought by a health care provider against an insurer based upon assignment of a claim to no-fault benefits from a patient (pursuant to General Obligations Law ß13-105), the court held that, contrary to a Civil Court, New York County opinion and in following case law from the District Court, Nassau County, the assignment presented was valid despite its failure to contain language that the health care provider waived any claim against the patient. There is no requirement that an assignment have any particular language in order to be effective.
Woods v. Real Renters Ltd., 2007 WL 656907 (SDNY 01-CV-0269, 2007). Summary judgment was granted to the landlord in a housing discrimination action, dismissing all causes of action including under the Fair Housing Act, 42 USC §1981, intentional infliction of emotional distress and breach of contract. The prospective tenants alleged that their race was a motivating factor in the landlord’s decision not to rent them the unit. The real estate broker suggested that “some elderly Jewish landlords were reluctant to rent to African-Americans.” However, no evidence was shown that this was true; on the contrary, the broker admitted that his belief was purely speculative.
Solomon Pearl Blum Heymann & Stich LLP v. Eurotech Ltd., American Arbitration Association No. 13-19400076-05. Retained by law firm to render report and testify as to the reasonableness of attorney’s fee in a collection matter. The firm sought an award of $127,000 in legal fees against its publicly-traded client based upon the client’s failure to pay for services rendered. The report and testimony given were focused upon (a) the reasonableness of the hourly fees sought in the context of the particular area of practice and the geographic area; and (b) the usual and customary rate charged by similar attorneys performing similar legal work. The arbitrator found in favor of the law firm and awarded all of the fees sought.
Arbitrator – Fee Dispute Resolution: Qualified as arbitrator of attorney-client fee disputes pursuant to Part 137 of the Rules of Court - Attorney-Client Fee Dispute Resolution Program
Williams v. Williams, 245 A.D.2d 49, 665 N.Y.S.2d 86 (1st Dept. 1997), unanimously reversed decision of the Supreme Court, Bronx County, in which the appellate court held that expenses of child's education by one spouse could not constitute a basis for decreasing that spouse's presumptive equal share of the distributive award in a long-term marriage.
Folk v. Folk, 214 A.D.2d 645, 625 N.Y.S.2d 935 (2d Dept. 1995), unanimously affirmed decision of the Supreme Court, Queens County, in which the lower court ruled that a spouse who failed to answer a divorce action, based upon excusable neglect, could obtain the vacatur of a default Judgment of Divorce procured by the other spouse.
Calia v. Calia, 671 N.Y.S.2d 981 (2d Dept. 1998), unanimously affirmed decision of the Supreme Court, Kings County, which granted pendente lite counsel fees and business appraiser fees to a needy spouse. The Court held the proper relief afforded to a party aggrieved by an adverse pendente lite Order is to proceed to a speedy trial.
Phinn v. Douglas, Docket No. P-07443/89B (Family Ct., Kings Co. 1999). In following the holding in Cassano v. Cassano, 203 A.D.2d 563 (2d Dept. 1994), the Family Court held that, absent a voluntary agreement between the parties, the court could not require a party to pay for private tutorial services for a child unless special circumstances existed.
Lacorazza v. Lacorazza, 742 N.Y.S.2d 89 (2d Dept. 2002). In this post-Judgment of Divorce litigation, the Supreme Court properly determined that the defendant-husband was liable for college expenses of his son and child support due to plaintiff-wife pursuant to the parties' settlement agreement. The fact that it took the son a longer period of time to graduate from college than anticipated was not deemed such an unusual occurrence as to warrant total denial of payment for college tuition expenses.
Allain v. Kronowitz & Lentol, Index No. 7128/99 (Civil Ct., Kings Co. 2000), Action for legal malpractice in connection with a real estate closing which occurred more than seven years prior to the commencement of an action was dismissed based upon statute of limitations defense of three years period, where plaintiff could not show fraudulent concealment or continuous treatment on the part of attorneys.
West v. Rivera, 728 N.Y.S.2d 789 (2d Dept. 2001). Trial court properly denied defendant's motion for summary judgment for dismissal of a personal injury action on the basis of not meeting the threshold under the No-Fault law since the affidavit of the radiologist attached could not identify the specific etiology of the disc herniation. The Second Department held that a defendant making this type of motion must make a prima facie demonstration that the disc herniation was not causally related to the subject accident in order to prevail on the motion.
Estate of Robert Keaton, File No. 3736/99 (Surrogate's Ct., Kings Co. 2000), Letters of Administration were granted to an adult child of the Decedent, despite being born out of wedlock, where the child produced an Order of Filiation from the Family Court, in accordance with the provisions of Surrogate's Court Procedure Act §1001.
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