The opinion
State of New York
Supreme Court, Appellate Division
Third Judicial Department
Decided and Entered: November 5, 2015 520202
________________________________
DAVID L. GANJE,
Appellant,
v
LATEEF YUSUF et al.,
Defendants, MEMORANDUM AND ORDER
and
FRANKLIN CREDIT MANAGEMENT
CORPORATION,
Respondent.
________________________________
Calendar Date: September 14, 2015
Before: Egan Jr., J.P., Rose, Devine and Clark, JJ.
__________
Zachary A. Waksman, Easton, Massachusetts, for appellant.
O'Hare Parnagian, LLP, New York City (Robert A. O'Hare of
counsel), for respondent.
__________
Egan Jr., J.P.
Appeal from an order of the Supreme Court (Platkin, J.),
entered November 12, 2014 in Albany County, which, among other
things, granted a motion by defendant Franklin Credit Management
Corporation to dismiss the complaint against it.
In 2007, Home Vest Capital, LLC, the holder of an unpaid
promissory note executed by defendant Lateef Yusuf, retained
plaintiff, an attorney, to commence a collection action against
Yusuf. Pursuant to a contingent fee arrangement, plaintiff was
entitled to 25% of any money paid and/or collected from Yusuf.
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In January 2008, plaintiff obtained a default judgment against
Yusuf on behalf of Home Vest for $134,710.03. The judgment in
question served as a lien on Yusuf’s real property located at 650
Chauncey Street in Brooklyn.
In February 2009, Home Vest filed a chapter 7 bankruptcy
petition, wherein it listed plaintiff and Varde Investment
Partners, L.P. as two of its creditors. Prior to such filing,
Home Vest and Varde had executed two separate agreements that,
ultimately, resulted in Varde acquiring title to Home Vest’s
portfolio of performing and nonperforming loans. In December
2008, Varde assigned this portfolio, which apparently included
the underlying judgment against Yusuf, to SCD Recovery, LLC.
SCD, in turn, sold and assigned the portfolio to Bosco Credit VI,
LLC (hereinafter Bosco Credit) in May 2012. Ultimately, the
judgment against Yusuf was assigned to Bosco Credit VI Trust
Series 2012-1 (hereinafter Bosco Trust) in December 2013.1
In the interim, in May 2013, plaintiff received an email
from an individual who identified himself as the listing agent
representing Yusuf in a short sale of the Chauncey Street
property. This listing agent indicated that the first mortgagee
had approved of the sale of the property and inquired as to
whether plaintiff knew the identity of the entity holding or
servicing the second mortgage on those premises. Plaintiff
replied that he had no contact information for this creditor.
Four months later, plaintiff emailed both the listing agent and
an apparent representative of the relevant title company –
advising them of both the judgment docketed against Yusuf on
behalf of Home Vest and the corresponding charging lien for
counsel fees. Plaintiff, who acknowledged that the listing agent
was in negotiations with "the apparent but unconfirmed assignee"
1
Most of the underlying assignment agreements either omit
the schedule of assets assigned or only reference such assets by
loan number, thereby making it difficult to document the
progression of the underlying judgment through this series of
transactions. However, the final assignment of judgment to Bosco
Trust expressly references the Yusuf judgment by name, date and
amount, thus establishing the holder thereof.
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of the judgment, indicated that he would provide "a satisfaction
of judgment lien as against [the] property" once the agents had
identified "the current assignee or owner with authority to
settle the [j]udgment" and confirmed the settlement terms;
plaintiff further asked that such agents "advise the judgment
creditor in writing of the terms" outlined in plaintiff's email.
Although the title agent acknowledged the need to establish the
chain of assignments and suggested that defendant Franklin Credit
Management Corporation (hereinafter defendant) might be Home
Vest's successor in interest, the listing agent subsequently
advised plaintiff that he had been in touch with defendant
relative to the short sale of Yusuf's property and that defendant
"seem[ed] to have no knowledge of any judgment."
In October 2013, Yusuf sold the property to defendant 650
Chauncey Street LLC for $180,000. The listing agent informed
plaintiff of the sale in November 2013 and indicated that Yusuf
"was able to negotiate a full settlement of the lien and judgment
with the current lien holder." Thereafter, in March 2014,
plaintiff reached out to defendant requesting, among other
things, copies of the closing documents relative to that sale.
When such documents, including a purported satisfaction or
release of judgment, were not forthcoming, plaintiff commenced
this action asserting – insofar as is relevant to this appeal –
causes of action against defendant sounding in fraudulent
concealment, unjust enrichment, aiding and abetting fraud and
enforcement of an attorney charging lien. In response, defendant
moved to dismiss the complaint pursuant to CPLR 3211 (a) (1),
(5), (7) and (10). Plaintiff then cross-moved for, among other
things, leave to amend the complaint to add Bosco Credit and
Bosco Trust as named defendants. Supreme Court granted
defendant's motion to dismiss the complaint against it based upon
documentary evidence and granted so much of plaintiff's cross
motion as sought to add the respective Bosco entities as parties
to this action. Plaintiff now appeals, contending that Supreme
Court erred in dismissing the complaint against defendant.
We affirm. A motion to dismiss pursuant to CPLR 3211 (a)
(1) is properly granted "where the documentary evidence utterly
refutes plaintiff's factual allegations, conclusively
establishing a defense as a matter of law" (Goshen v Mutual Life
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Ins. Co. of N.Y., 98 NY2d 314, 326 [2002]; see State Farm Fire &
Cas. Co. v Main Bros. Oil Co., 101 AD3d 1575, 1576-1577 [2012];
Mason v First Cent. Natl. Life Ins. Co. of N.Y., 86 AD3d 854, 855
[2011]). "Materials that clearly qualify as documentary evidence
include documents reflecting out-of-court transactions such as
mortgages, deeds, contracts, and any other papers, the contents
of which are essentially undeniable" (Midorimatsu, Inc. v Hui Fat
Co., 99 AD3d 680, 682 [2012], lv dismissed 22 NY3d 1036 [2013]
[internal quotation marks and citations omitted]). To that end,
an attorney's affidavit may serve "as a vehicle for the
submission of documentary evidence" (Gihon, LLC v 501 Second St.,
LLC, 103 AD3d 840, 842 [2013]; see Furlender v Sichenzia Ross
Friedman Ference LLP, 79 AD3d 470, 470 [2010]).
Here, the documentary evidence submitted on behalf of
defendant included, among other things, the December 2008
assignment and assumption agreement between Varde and SCD, the
May 2012 assignment and bill of sale between SCD and Bosco Credit
and the December 2013 assignment of the Yusuf judgment to Bosco
Trust – none of which bear any indication that defendant was a
party to these transactions or otherwise was referenced in the
chain of assignments relative to the Yusuf judgment. Such proof,
in our view, was sufficient to conclusively refute plaintiff's
allegation that defendant either held or serviced the underlying
judgment. In opposition, plaintiff asserted that the respective
Bosco entities were alter egos of – and were fully controlled by
– defendant; hence, as the "co-owner . . . and the contracted
servicing agent" for the judgment, defendant was a proper party
to this action. To support this claim, plaintiff tendered
certain of defendant's annual reports and quarterly filings with
the Securities and Exchange Commission, which indeed establish
that defendant has invested in some of the Bosco-related entities
and, further, has serviced and managed some loans held by such
entities. As Supreme Court aptly observed, however, proof of
some sort of a business relationship between defendant and the
various Bosco entities relative to an unidentified collection
and/or portfolio of residential mortgages falls far short of
establishing that "(1) [defendant] exercised complete domination
of [the Bosco entities] in respect to the transaction attacked;
and (2) that such domination was used to commit a fraud or wrong
against [plaintiff] which resulted in [plaintiff's] injury"
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(Matter of Island Seafood Co. v Golub Corp., 303 AD2d 892, 893
[2003]). Under these circumstances, Supreme Court properly
granted defendant's motion to dismiss the complaint based upon
documentary evidence. Plaintiff's remaining arguments, including
his assertion that defendant should be equitably estopped from
denying that it is a proper party to this action, have been
examined and found to be lacking in merit.
Rose, Devine and Clark, JJ., concur.
ORDERED that the order is affirmed, with costs.
ENTER:
Robert D. Mayberger
Clerk of the Court