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Ross v. Sherman

Supreme Court of the State of New York, Orange County
Dec 4, 2007
2007 N.Y. Slip Op. 52658 (N.Y. Sup. Ct. 2007)

Opinion

5761/06.

Decided December 4, 2007.

Steven I. Milligram, Esq., Tarshis, Catania, Liberth,, Mahon Milligram, PLLC, for Plaintiff, Newburgh, New York.

Stephen L. Reineke, Esq., Levinson, Reineke Ornstein, P.C., for Defendant, Central Valley, New York.


Plaintiffs commenced this action seeking to obtain equitable relief, declaratory relief and money damages, based upon claims related to certain written agreements executed by plaintiff Allan J. Ross and defendant Steven Sherman. Now before the Court is plaintiffs' motion for summary judgment in their favor on their causes of action against defendants and summary judgment dismissing defendants' counterclaims.

I. FACTUAL BACKGROUND

On February 21, 2002 Ross and Sherman formed plaintiff Lina, LLC (Lina), in furtherance of their plan to engage in a joint venture. One of Lina's first investments was a commercial property located in Blooming Grove, New York (the Blooming Grove Property). Subsequently, Ross and Sherman reached an agreement concerning the Blooming Grove Property (the Blooming Grove Agreement) whereby each would operate his own business from the property, and would contribute two-thirds and one-third, respectively, of the monthly carrying costs of that property. Another aspect of the Blooming Grove Agreement was that Sherman was required to pay for and complete 100% of the improvements of the property, in consideration for which he was to receive 100% of the profits from the sales of future properties acquired and sold by Lina, until he had recovered the expenses paid by him for the improvements to the Blooming Grove Property.

Thereafter, Lina contracted to purchase a property on Riley Road, in Chester, New York (the Riley Road Property). However, Lina could not qualify for the funding necessary for that purchase. Consequently, Sherman obtained a $650,000 mortgage to finance the purchase and took title to the Riley Road Property in his own name at the closing on the sale held on August 30, 2005.

As a result of disputes that followed the acquisition of the Riley Road Property, Ross and Sherman agreed to dissolve Lina. To accomplish that dissolution, the executed a written agreement designated a "CONTRACT OF SALE AND ASSIGNMENT OF PROCEEDS" (Sherman Affid., Exh.A, Complaint, Exh.E, p. 1 [hereinafter "the Dissolution Agreement"]). Therein, they provided for, inter alia, the assignment to Lina of their individual interests in the Riley Road Property, the distribution of the sale proceeds of that property, and the exclusive listing of the property for sale by Ross' wife, Linda Ross.

Claiming that Sherman, and his company, defendant Walden Oaks, Inc., have breached the Dissolution Agreement and the Blooming Grove Agreement in several ways, and have unlawfully taken monies of Lina, plaintiffs commenced this action. In their complaint, plaintiffs assert claims sounding in, inter alia, breach of contract, breach of fiduciary duties, prima facie tort and negligence. Defendants responded to the complaint with an answer containing eleven counterclaims (collectively hereinafter "the Eleven Counterclaims"]).

As noted, plaintiffs have now moved for summary judgment in their favor on their complaint and summary judgment dismissing the Eleven Counterclaims. Defendants oppose the motion in all respects.

II. DISCUSSION

In support of their motion, plaintiffs have offered proof that Sherman has failed to transfer his interest in the Riley Road Property to Lina, as required by the Dissolution Agreement. They have also presented evidence supporting each of their other causes of action. Finally, they have tendered proof warranting dismissal of the Eleven Counterclaims. Taken together, plaintiffs' showing is sufficient to entitle them to summary judgment, thereby shifting the burden to defendants to demonstrate the existence of a factual issue requiring a trial ( see generally Zuckerman v. City of New York, 49 NY2d 557,562 [1980]).

Notably, defendants have failed to address the attacks upon the Eleven Counterclaims. For that reason, plaintiffs are granted summary judgment dismissing the Eleven Counterclaims.

As relates to those claims which are based upon the alleged improper taking of Lina's funds, the failure to contribute to the carrying charges of the Blooming Grove Property and the failure to develop the Riley Road Property, defendants have presented evidence, including relevant contractual language set forth in the Dissolution Agreement, which supports their view that Sherman's consent was required to make certain improvements in that property and that he exercised his right not to agree, and that they have not breached their financial obligations under either the Dissolution Agreement or the Booming Grove Agreement. Consequently, to the extent that summary judgment is sought upon those claims, the motion is denied based upon the existence of factual issues which cannot be resolved without a trial.

By contrast, defendants have failed to demonstrate that factual issues exist which preclude relief as to certain of the parties' other disputed issues. Among those are Lina's right to the transfer to it of Sherman's interest in the Riley Road Property and Linda Ross' right to the exclusive listing of that property for sale. Therefore, pursuant to CPLR 3212(g) , the Court grants partial summary judgment resolving four of the parties' disputed issues ( see Cooper v. Mallory, 51 Misc 2d 749,751 [Sup Ct. Suffolk Co. 1966]).

CPLR 3212(g) provides that:
If a motion for summary judgment is denied or is granted in part, the court, by examining the papers before it and, in the discretion of the court, by interrogating counsel, shall, if practicable, ascertain what facts are not in dispute or are incontrovertible. It shall thereupon make an order specifying such facts and they shall be deemed established for all purposes in the action. The court may make any order as may aid in the disposition of the action.

III. FURTHER PROCEEDINGS

It appears that there has been no judicial intervention requested in this action except for the filing of this motion. Consequently, a preliminary conference must be conducted to determine the status of pretrial discovery and to establish a schedule for the completion of any remaining discovery. Counsel for the parties shall appear before this Court for that conference at 9:30 a.m. on January 18, 2008.

WHEREFORE, it is

ORDERED that the motion is granted to the extent set forth below; and it is further

DECLARED AND ORDERED that: (1) Lina is the owner of the Riley Road Property; (2) Sherman has assigned all of his right, title and interest in the Riley Road Property to Lina; (3) Lina is entitled to specific performance of Sherman's obligation to transfer his interest in the Riley Road Property to Lina; and (4) defendants are estopped from contesting that Linda Ross has the exclusive right to market the Riley Road Property for sale; and it is further

ORDERED that within twenty (20) days from the date of entry of this decision and order, Sherman shall execute all documents, including a deed, necessary to transfer his interest in the Riley Road Property to Lina.

The foregoing shall constitute the decision and order of the Court.


Summaries of

Ross v. Sherman

Supreme Court of the State of New York, Orange County
Dec 4, 2007
2007 N.Y. Slip Op. 52658 (N.Y. Sup. Ct. 2007)
Case details for

Ross v. Sherman

Case Details

Full title:ALLAN J. ROSS and LINA, LLC, Plaintiffs, v. STEVEN SHERMAN and WALDEN…

Court:Supreme Court of the State of New York, Orange County

Date published: Dec 4, 2007

Citations

2007 N.Y. Slip Op. 52658 (N.Y. Sup. Ct. 2007)
906 N.Y.S.2d 776