Opinion
No. 199 SSM 28.
Decided August 31, 2010.
APPEAL, by permission of the Court of Appeals, from an order of the Appellate Division of the Supreme Court in the Second Judicial Department, entered September 22, 2009. The Appellate Division order, insofar as appealed from, modified, on the law, so much of an order of the Supreme Court, Suffolk County (Andrew A. Crecca, J.), which had denied that branch of a motion by Mortgage Electronic Registration Systems, Inc. and Fremont Investment Loan for summary judgment dismissing the first cause of action in an action to set aside a deed insofar as asserted against them. The modification consisted of deleting the provision of the order denying that branch of the motion which was for summary judgment dismissing the first cause of action in the action to set aside a deed insofar as asserted against movants, and substituting therefor a provision granting that branch of the motion.
The first above-entitled action was for a divorce and ancillary relief. The remaining two related actions sought to set aside a deed on the basis of fraud, and to foreclose a mortgage given on the deeded property. In November 2001, the individual plaintiff acquired title to certain property in Ronkonkoma, New York. In June 2002 a deed was executed transferring title to the property to plaintiffs wife. The same day, plaintiffs wife executed a mortgage on the property in favor of Flagstar Bank and turned over most of the proceeds from the mortgage to her husband, who claimed that in June 2004, while preparing to file for divorce, he discovered that his wife had forged his name on a deed which transferred title to the Ronkonkoma property from him to her. He filed a notice of pendency on the property in August 2004. Shortly thereafter, plaintiffs wife executed a mortgage on the Ronkonkoma property in favor of Fremont Investment Loan. The mortgagees sought relief alleging, in part, that plaintiff, by accepting the proceeds from the Flagstar Bank loan, had ratified the forgery.
Saltzman Chetkof Rosenberg, LLP, Garden City ( Michael Chetkof of counsel), for appellant.
Solomon Siris, PC, Uniondale ( Michael J. Siris of counsel), for respondents.
Before: Chief Judge LIPPMAN and Judges CIPARICK, GRAFFEO, READ, SMITH, PIGOTT and JONES concur in memorandum.
OPINION OF THE COURT
MEMORANDUM .
The order of the Appellate Division, insofar as appealed from, should be reversed, with costs, and the motion by defendants Fremont Investment Loan and Mortgage Electronic Registration Systems, Inc. for summary judgment dismissing the first cause of action against them denied.
Issues of fact exist with respect to whether plaintiff Thomas E Cashel possessed the requisite "knowledge of material facts" concerning the allegedly binding deed ( Matter of New York State Med. Transporters Assn. v Perales, 77 NY2d 126, 131). Although plaintiff admitted to receiving certain monies from Francine Cashel, he alleged that she "advis[ed] him that she had received these funds from the proceeds of the mortgage loan," which he had authorized her to obtain as his agent. Moreover, as argued by plaintiff, his receipt of these monies does not prove that he had any prior knowledge of Francine's alleged forgery of the deed, especially considering that he authorized her to obtain a mortgage on the property. In addition, plaintiff claimed that he had not learned of the alleged forgery until June 2004 and that he filed a notice of pendency on the property in August 2004 "several months before defendant Fremont Investment Loan issued its loan to Francine. Thus, the Court cannot conclude, as a matter of law, that plaintiff ratified the deed.
On review of submissions pursuant to section 500.11 of the Rules of the Court of Appeals ( 22 NYCRR 500.11), order, insofar as appealed from, reversed, etc.