Opinion
03-15-2016
Joseph BRUNNER, et al., Plaintiffs–Respondents, v. The ESTATE OF Chaim LAX, etc., et al., Defendants–Appellants, Tracy L. Klestadt, et al., Defendants.
Morrison Cohen LLP, New York (Y. David Scharf of counsel), for appellants. Herrick, Feinstein LLP, New York (William R. Fried of counsel), for respondents.
Morrison Cohen LLP, New York (Y. David Scharf of counsel), for appellants.
Herrick, Feinstein LLP, New York (William R. Fried of counsel), for respondents.
Opinion
Orders, Supreme Court, New York County (Shirley Werner Kornreich, J.), entered April 3, 2015 and April 6, 2015, which, to the extent appealed from as limited by the briefs, denied defendants-appellants' (hereinafter defendants) motions to dismiss the first cause of action pursuant to CPLR 3211(a)(3), unanimously affirmed, without costs.
Defendants claim they are appealing from the denial of their motions to dismiss the first three causes of action. However, the motion court dismissed the second and third causes of action.
Defendants failed to meet their burden on this pre-answer motion to dismiss pursuant to CPLR 3211(a)(3) to establish prima facie that plaintiffs have no standing to sue on the promissory note (see Deutsche Bank Trust Co. Ams. v. Vitellas, 131 A.D.3d 52, 59–60, 13 N.Y.S.3d 163 [2d Dept.2015] ). Defendants contend that the note had not been validly assigned to plaintiffs prior to the commencement of this action (see Carlin v. Jemal, 68 A.D.3d 655, 891 N.Y.S.2d 391 [1st Dept.2009] ). However, an assignment need not be in writing, but can be effected by physical delivery (see e.g. Fryer v. Rockefeller, 63 N.Y. 268, 276 [1875]; Bank of N.Y. v. Silverberg, 86 A.D.3d 274, 281, 926 N.Y.S.2d 532 [2d Dept.2011]; LaSalle Bank Natl. Assn. v. Ahearn, 59 A.D.3d 911, 875 N.Y.S.2d 595 [3d Dept.2009]; see also OneWest Bank FSB v. Carey, 104 A.D.3d 444, 445, 960 N.Y.S.2d 306 [1st Dept.2013]; Aurora Loan Servs., LLC v. Taylor, 25 N.Y.3d 355, 361, 12 N.Y.S.3d 612, 34 N.E.3d 363 [2015] ). The complaint alleges, “As of March 2014, [plaintiff] JBAM [Realty LLC] is in physical possession of the Note.” While this allegation could have been better phrased, construed liberally and in the light of “every possible favorable inference” (see 511 W. 232nd Owners Corp. v. Jennifer Realty Co., 98 N.Y.2d 144, 152, 746 N.Y.S.2d 131, 773 N.E.2d 496 [2002] ), it can be read as saying, “Since March 2014, JBAM has been in physical possession of the Note”—especially because plaintiffs' counsel represented at oral argument that his clients had physical possession of the note at the time they commenced their lawsuit. This action was commenced on or about March 31, 2014.
Defendants contend that discovery should be limited to standing. We leave that issue to the motion court's broad discretion (CDR Créances S.A.S. v. Cohen, 77 A.D.3d 489, 491, 909 N.Y.S.2d 697 [1st Dept.2010] ).