The opinion
State of N.Y. Mtge. Agency v 936-938 Cliffcrest Hous.
Dev. Fund Corp.
2024 NY Slip Op 34560(U)
December 23, 2024
Supreme Court, New York County
Docket Number: Index No. 850011/2013
Judge: Debra A. James
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: NEW YORK COUNTY CLERK 12/23/2024 04:41 PM INDEX NO. 850011/2013
NYSCEF DOC. NO. 1584 RECEIVED NYSCEF: 12/23/2024
SUPREME COURT OF THE STATE OF NEW YORK
NEW YORK COUNTY
PRESENT: HON. DEBRA A. JAMES PART 59
Justice
---------------------------------------------------------------------------------X INDEX NO. 850011/2013
STATE OF NEW YORK MORTGAGE AGENCY,
MOTION DATE 11/22/2024
Plaintiff,
MOTION SEQ. NO. 031 032 036
-v-
936-938 CLIFFCREST HOUSING DEVELOPMENT FUND
CORPORATION, THE DEPARTMENT OF THE CITY OF
NEW YORK, NEW YORK CITY ENVIRONMENTAL
CONTROL BOARD, NEW YORK STATE DEPARTMENT
DECISION + ORDER ON
OF TAXATION AND FINANCE, NEW YORK CITY
DEPARTMENT OF FINANCE, MOTION
Defendants.
First party action dismissed by Order dated June 29, 2018
(Madden, J.) (NYSCEF Doc No 1108)
---------------------------------------------------------------------------------X
936-938 CLIFFCREST HOUSING DEVELOPMENT FUND Third-Party
CORPORATION, Index No. 595322/2014
Plaintiff,
-against-
THE WAVECREST MANAGEMENT TEAM LTD., SHUHAB
HOUSING DEVELOPMENT FUND CORPORATION,
COMMUNITY CAPITAL BANK, LEE WARSHAVSKY, JOHN
AND JANE DOES 11-20, and THE DEPARTMENT OF
HOUSING PRESERVATION AND DEVELOPMENT OF THE
CITY OF NEW YORK,
Defendants.
--------------------------------------------------------------------------------X
The following e-filed documents, listed by NYSCEF document number (Motion 031) 1443, 1444, 1445,
1446, 1447, 1448, 1449, 1450, 1451, 1452, 1453, 1454, 1455, 1456, 1457, 1458, 1459, 1460, 1461,
1462, 1463, 1466, 1467, 1468, 1469, 1470, 1471, 1472, 1473, 1474, 1475, 1476, 1477, 1478, 1482,
1483, 1484, 1485, 1486, 1487, 1488, 1489, 1490, 1535, 1536, 1537, 1538, 1539, 1540, 1575
were read on this motion to/for DISCOVERY .
The following e-filed documents, listed by NYSCEF document number (Motion 032) 1491, 1492, 1493,
1494, 1495, 1496, 1497, 1498, 1499, 1500, 1501, 1502, 1530, 1531, 1532, 1533, 1534, 1545, 1546,
1548, 1552, 1556, 1557, 1558, 1559, 1560, 1576
were read on this motion to/for DISCOVERY .
850011/2013 938 ST. NICHOLAS AVENUE vs. 936-938 CLIFFCREST HOUSING Page 1 of 6
Motion No. 031 032 036
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FILED: NEW YORK COUNTY CLERK 12/23/2024 04:41 PM INDEX NO. 850011/2013
NYSCEF DOC. NO. 1584 RECEIVED NYSCEF: 12/23/2024
The following e-filed documents, listed by NYSCEF document number (Motion 036) 1569, 1570, 1571,
1572, 1573, 1574, 1577, 1578, 1579, 1580
were read on this motion to/for CONSOLIDATE/JOIN FOR TRIAL .
ORDER
Upon the foregoing documents, it is
ORDERED that the motion of third party plaintiff, pursuant
to CPLR § 602(b), brought by show cause order dated November 22,
2024, to consolidate the summary proceeding entitled Burroughs v
Cliffcrest Housing Development Fund Co, LT 316385/2022 (NYC
Civil Court, NY Co) with the herein action (motion sequence
number 036) is dismissed, as moot, in light of the dismissal of
such summary proceeding by order dated December 3, 2024 (LT
316385/2022 NYSCEF Doc No 71)1, and the interim stay therein is
lifted and vacated; and it is further
ORDERED that the motion brought by order to show cause
dated January 1, 2024, pursuant to CPLR 3126, of third party
defendant City of New York to compel discovery and for a
protective order, and the cross motion of third party plaintiff
to strike the pleadings of third party defendant City of New
1
The undersigned is flummoxed that, on December 3, 2024,
petitioners’ attorneys in such summary proceeding defaulted in
appearing on the scheduled hearing date in NYC Housing Court
Part B- HP HPD, and failed to personally deliver a copy of this
court’s OSC with interim stay to NYC Housing Evon M. Astoris,
resulting in the proceeding being dismissed for the failure of
such attorneys to appear.
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Motion No. 031 032 036
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[* 2]
FILED: NEW YORK COUNTY CLERK 12/23/2024 04:41 PM INDEX NO. 850011/2013
NYSCEF DOC. NO. 1584 RECEIVED NYSCEF: 12/23/2024
York for its failure to disclose (mot seq no 031) are denied;
and it is further
ORDERED that the motion of third party defendant City of
New York to compel discovery (mot seq no 032) is denied; and it
is further
ORDERED that the note of issue and certificate of readiness
shall be filed no later than January 24, 2025.
DECISION
A brief procedural history of this action follows.
Nearly twelve years ago, the first party action, a
foreclosure action brought by Peny & Co, as plaintiff, was
commenced against 936-938 Cliffcrest Development Fund
Corporation (hereinafter “Cliffcrest HDFC”), as defendant. Nine
months later, defendant Cliffcrest HDFC served an answer with
counterclaims and a third party complaint alleging, in
connection with renovation financing of and construction work
performed on the Mortgaged Premises, fraud, conspiracy to commit
fraud, and violations of the Racketeer Influenced and Corrupt
Organizations Act (RICO), 18 USC 1961, et seq., against third
party defendants The Wavecrest Management Team LT, Shubab
Housing Development Fund Corporation, Lee Warshavsky, and the
City of New York (NYSCEF Doc No 80).
A receiver was appointed “to take charge and enter into
possession of the Mortgaged Premises” by Order dated March 17,
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FILED: NEW YORK COUNTY CLERK 12/23/2024 04:41 PM INDEX NO. 850011/2013
NYSCEF DOC. NO. 1584 RECEIVED NYSCEF: 12/23/2024
2015. (NYSCEF Doc No 329). In April 2015, such Receiver entered
into a Management Agreement with Finger Management Corp. (NYSCEF
Doc No 335), and retained the law firm of Newman Ferrara LLP for
legal services (NYSCEF Doc No 336).
By Order dated June 29, 2018 (NYSCEF Document No 113),
after an evidentiary hearing, the court (Madden, JSC) dismissed
the first party mortgage foreclosure action for plaintiff’s
failure to establish compliance with the notice of foreclosure
requirements of RPAPL § 1303(b).2
By Order dated July 3, 2019, the court approved the final
accounting of the Receiver, which in light of four intermediate
account, comprised total legal fees in excess of $150,000 paid
to counsel Newman Ferrara and successor counsel Borah Goldstein,
Altschuler, Nahins & Goidel, P.C.
In the remaining third party-action, on November 3, 2023,
third party defendant City of New York amended its third party-
answer to interpose counterclaims for, inter alia, foreclosure
of its mortgage (NYSCEF Doc No 1395).
2
By Summons and Complaint dated August 13, 2018, 938 St. Nicholas
Avenue Lender, LLC commenced a foreclosure action against
Cliffcrest HDFC, 938 St. Nicholas Avenue Lender, LLC v
Cliffcrest HDFC, NY Co Sup Ct Index No. 850233/2018, which
action is assigned to Kahn, JSC. On May 24, 2024, the Note of
Issue Without Jury Demand was filed in that action. (NY Co
Supreme Court Index No 850233/2018 NYSCEF Doc No 415).
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FILED: NEW YORK COUNTY CLERK 12/23/2024 04:41 PM INDEX NO. 850011/2013
NYSCEF DOC. NO. 1584 RECEIVED NYSCEF: 12/23/2024
By Stipulation dated January 18, 2023, third party
plaintiff Cliffcrest HDFC discontinued, with prejudice, its
third party action as against third party defendants The
Wavecrest Management Team LT, Shubab Housing Development Fund
Corporation and Lee Warshavsky (NYSCEF Doc No 1314). Such
Stipulation was not so-ordered by this court as it was not
signed by third party defendant City of New York as required
pursuant to CPLR 3217(a)(2).
More than a dozen discovery conferences have been held over
the course of this litigation, including several before the
undersigned.3 Reviewing the docket, and given this court’s own
supervision of discovery since having been assigned this case in
April 2021, this court finds that the parties have had ample
time to complete discovery over the twelve years since this
action was commenced.4 In such vein, this court determines that
counsel on each side, however well intentioned, have been
extremely dilatory in carrying out their exchange of documents
and taking of examinations before trial, despite multiple
3
Throughout the course of this litigation, each side has
improperly and unnecessarily cluttered the electronic docket
with discovery demands and responses thereto. In 2023 alone,
defendant City of New York loaded the electronic docket with
eighteen notices of depositions (along with other discovery
demands and responses to demands)(NYSCEF Doc Nos 1351-1360) and
counting.
4
By its Order of Mediation dated June 4, 2024, this Court did not
stay discovery (NYSCEF Doc No 1547). Such Mediation was
unsuccessful and closed on December 19, 2024.
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FILED: NEW YORK COUNTY CLERK 12/23/2024 04:41 PM INDEX NO. 850011/2013
NYSCEF DOC. NO. 1584 RECEIVED NYSCEF: 12/23/2024
discovery conference orders directing them to do so, and their
multiple motions to compel discovery, over the past decade.
Therefore, with respect to depositions and any other remaining
paper discovery, the court holds that the parties have each
waived any further rights to do so. See Butler v General Motors
Corp, 37 AD2d 957 (1st Dept 1971). This case shall be placed on
the trial calendar forthwith, upon e-filing of the Note of Issue
and Certificate of Readiness, within the thirty days of entry of
this order.
.v-~ JI - } ~
20241223145238DJAMES495F69975A00420A93B1CB18DE5FC4CA
12/23/2024
DATE DEBRA A. JAMES, J.S.C.
CHECK ONE: CASE DISPOSED X NON-FINAL DISPOSITION
□ □
GRANTED X DENIED GRANTED IN PART OTHER
APPLICATION: SETTLE ORDER SUBMIT ORDER
□
CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT REFERENCE
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