Opinion
012393-10.
Decided October 12, 2010.
Robert P. Lynn, Jr. Esq., Lynn, Gartner Dunne, LLP., Mineola, New York, Attorney for Plaintiffs.
Willkie Farr Gallagher LLP, New York, New York, Attorney for Defendants.
Ms. Luisa Belletti, Bay Shore, New York, Defendant Pro Se.
Motion pursuant to CPLR 3211[a], [7] by the defendants Gary Giampetruzzi and Lora Giampetruzzi for an order dismissing the complaint and for the imposition of sanctions pursuant to 22 NYCRR § 130-1.1
Motion by the defendant and Luisa Belletti pursuant to CPLR 3211[a][7] by the defendants Gary Giampetruzzi and Lora Giampetruzzi for an order dismissing the complaint and for the imposition of sanctions pursuant to 22 NYCRR § 130-1.1
In May of 2007, Gary Giampetruzzi and his wife, Lora Giampetruzzi — both of whom are attorneys — purchased a one-family Manhasset, New York residence from the defendants David and Karen Corcoran (A. Cmplt., ¶¶ 11-12 [Kozusko Aff., Exh., "B"]).
According to the Giampetruzzis, prior to acquiring the Manhasset property they affirmatively inquired of David Corcoran whether, in fact, he had ever experienced any flooding or water issues at the premises in the approximately seven-year period during which he and his wife lived in the home (A. Cmplt., ¶¶ 53-56; 77-81).
Corcoran allegedly replied that he had not, after which the Giampetruzzis, then proceeded with the purchase and moved into the home in June of 2007 (A. Cmplt., ¶¶ 14-15, 53-56).
Some two weeks after Giampetruzzis moved into house, a significant rainfall occurred which caused "substantially the entire basement" to become flooded (A. Cmplt., ¶¶ 15-16). The Giampetruzzis thereafter experienced basement flooding on a number of occasions and also discovered longstanding and "serious mold conditions in and around the basement area" (A. Cmplt., ¶¶ 15-16; 58-60; 72-76).
Moreover, after examining location where the flooding occurred, the Giampetruzzis claim to have discovered that the Corcorans renovated the basement — they contend — in order to conceal and cover up any evidence of flooding and/or water damage (A. Cmplt., ¶¶ 15-16; 20-34; 35-44 45-53).
The Giampetruzzis assert that to date, they have incurred substantial costs in attempting to water-proof the basement and/or to correct the flooding and mold problems, and that the flooding problems have decreased the market value of the home (A. Cmplt., ¶ 63).
In June of 2009, some two years after closing on the home, the Giampetruzzis commenced an action against the Corcorans, demanding some $500,000.00 in damages. Their verified complaint — as subsequently amended — contains a single cause of action grounded on the Corcorans' alleged fraud and/or active concealment of the flooding problems (A. Cmplt., ¶¶ 77-83).
The Corcorans answered, denied the material allegations of the complaint and interposed a "first" counterclaim. The counterclaim alleges in material part that the Giampetruzzis "spread false rumors" in the Manhasset community relating to the alleged flooding problems and that they then commenced a frivolous action, for which sanctions should be imposed pursuant to 22 NYCRR § 130-1.1 (Ans., ¶¶ 94-99).
Thereafter, the Giampetruzzis moved to dismiss the Corcorans' counterclaim. In response, the Corcorans opposed the motion and cross moved for summary judgment dismissing the complaint ( see, Kozusko Aff., Exh., "C").
In opposition to the cross motion, the Giampetruzzis submitted various expert affidavits, including the two and one-half page affidavit of one Luisa Belletti, who described herself as a "registered and licensed real estate broker since 2000" (Belletti Aff., ¶¶ 1-2 [Kozusko Aff., Exh., "D"]). Belletti's affidavit was submitted principally with respect to the issue of damages, and in particular, the alleged extent to which the home's value was diminished by virtue of the flooding and/or mold contamination problems (Belletti Aff., ¶¶ 4 — 8).
By order and decision dated April 7, 2010, this Court (Cozzens, J.), denied the parties' respective applications, concluding, inter alia, that "the * * * [Giampetruzzis] * * * [have] created a question of fact as to whether the conduct of the defendants rises to the level of active concealment" (Order at 2). The Court similar determinated that the Corcorans' claim for sanctions was sufficient to state a cause of action (Order at 1)( cf., Cho v. Yoo, ___ Misc 3d ___, 2009 WL 4927164, [Supreme Court, Nassau County 2009]).
Shortly thereafter, the Corcorans changed attorneys and retained their current counsel, Lynn, Gartner Dunne, LLP ( see, Kozusko Aff., Exh., "E"). According to the Giampetruzzis, in May of 2009, the Lynne Firm served various non-party subpoenas on the individuals who had submitted affidavits in support of the Giampetruzzi's prior motion — including Luisa Belletti. A dispute subsequently arose with respect to, inter alia, Belletti's amenability to the subpoena — which the Giampetruzzis claimed was improper since Belletti was a expert trial witness.
Significantly, it was revealed shortly after the Court's April, 2010 decision was issued that Belletti was not, in fact, a licensed real estate broker as stated in her November, 2009 affidavit; rather, she was instead a licensed real estate "salesperson" — and was also Lora Giampetruzzi's cousin (Cmplt., ¶¶ 7, 12-13). According to the Giampetruzzis, the misdescription relating to Belletti's broker's license was an inadvertent error.
In June of 2010, the Corcorans commenced the within action as against the Giampetruzzis. Their complaint contains two causes of action; one sounding in "intentional wrongdoing" and/or intentional tort, and the second based on Judiciary Law § 478.
Both causes of action demand $100,000.00 in damages and similarly aver that the Giampetruzzis intentionally falsified and then submitted the Belletti affidavit in opposition to the prior, Corcoran motion for summary judgment with the expectation that the Court would rely on Belletti's statements in rendering its summary judgment decision (Cmplt., ¶¶ 8-14).
More specifically, the complaint alleges that the Belletti affidavit was "false, untrue and perjures at the first paragraph thereof, where Ms. Belletti swore that she was a licensed real estate broker since 2000' * * *" (Cmplt., ¶ 12).
The complaint further avers that the Giampetruzzis did not disclose to the Court that Belletti was a relative and/or family friend (Cmplt., ¶¶ 6, 19); that the Giampetruzzis collusively and deceitfully filed the Belletti affidavit with knowledge of its falsity so as to mislead the Court and obtain a favorable summary judgment ruling; and that the Corcorans have incurred legal fees in defending against the Giampetruzzis' action (Cmplt., ¶¶ 18-24).
The Giampetruzzis now move to dismiss the Corcorans' complaint pursuant to CPLR 3211[a][7], and for the imposition of sanctions against the Corcorans and the Lynne firm ( see, 22 NYCRR 130-1.1).
Luisa Belletti moves by separate notice of motion for the same relief. The motion should be granted to the extent indicated below.
On a motion to dismiss pursuant to CPLR 3211[a][7], the Court must accept as true, the facts "alleged in the complaint and submissions in opposition to the motion, and accord plaintiffs the benefit of every possible favorable inference," determining only "whether the facts as alleged fit within any cognizable legal theory" ( Durrell-Harding v. State, 15 NY3d 8, 20; People ex rel. Cuomo v. Coventry First LLC, 13 NY3d 108, 115; Ninin v. City of New York, 9 NY3d 825, 827; Leon v. Martinez, 84 NY2d 83, 87-88).
Nevertheless, "bare legal conclusions with no factual specificity" and inherently incredible allegations are not entitled to such favorable consideration ( Godfrey v. Span, 13 NY3d 358, 373; Mass v. Cornell Univ., 94 NY2d 87, 91-92; Daub v. Future Tech Enterprise, Inc. , 65 AD3d 1004 , 1005; Chessman v. Hernandez, 61 AD3d 565, 566; Diner man v. Jewish Bd. of Family Children's Services, Inc. , 55 AD3d 530 , 531).
With respect to the first cause of action, which has been denominated as one sounding in, inter alia, "intentional wrongdoing," the operative allegations accuse the Giampetruzzis of filing a "misleading, false and perjures affidavit" (Cmplt., ¶¶ 15-16). It is settled, however, that "[no action lies to recover damages for alleged subornation of perjury in a prior action or proceeding, except where the perjury is part of a larger fraudulent scheme "greater in scope than the issues determined in the prior proceeding'" ( Retina Associates of Long Island, P.C. v. Rosberger, 299 AD2d 533, quoting from, Alexander v. City of Peekskill, 80 AD2d 626, 627 see also, Newin Corp. v. Hartford Acc. Indem. Co., 37 NY2d 211, 217-218; Mark v. Comcast Cable Communications, Inc. , 48 AD3d 338 ; North Shore Environmental Solutions, Inc. v. Glass , 17 AD3d 427; Martinson v. Blau, 292 AD2d 234, 235; Joseph v. Citibank, 271 AD2d 358; Yalkowsky v. Shedler, 94 AD2d 684, 685 see also, Haggerty v. Ciarelli Dempsey, ___ F3d ___, 374 Fed. Appx. 92, 94 [2nd Cir. 2010]).
In such a case the available remedy "lies exclusively in that lawsuit itself, i.e., by moving pursuant to CPLR 5015 to vacate the civil judgment due to its fraudulent procurement, not a second plenary action collaterally attacking the judgment in the original action" ( North Shore Environmental Solutions, Inc. v. Glass, supra, 17 AD3d at 428, quoting from, Yalkowsky v Century Apts. Assoc., 215 AD2d 214, 215 cf., God's Battalion of Prayer Pentecostal Church, Inc. v. Hollander, ___ Misc.3d ___ 2009 WL 2960629 at 8-9 [Supreme Court, Nassau County 2009]).
Here, the Corcoran complaint makes no express reference to any claim or asserted theory that the Giampetruzzis' alleged deceit/perjury was a part of "larger" fraudulent scheme, independent from, and/or "greater in scope than, the issues determined in the prior proceeding" ( Retina Associates of Long Island, P.C. v. Rosberger, supra, 299 AD2d 533 see also, Martinson v. Blau, 292 AD2d 234; Mark v. Comcast Cable Communications, Inc. , 48 AD3d 338 ; Joseph v. Citibank, supra, 271 AD2d 358). Nor are their facts in the record which would support such an unasserted inference or theory ( see, Mark v. Comcast Cable Communications, Inc., supra, North Shore Environmental Solutions, Inc. v. Glass, supra; Yalkowsky v. Shedler, supra, 94 AD2d 684, 685; Martinson v. Blau, supra).
To the contrary, the plain import and thrust of the Corcorans' pleading is that alleged deceit was perpetrated exclusively to mislead the Court and obtain a favorable decision solely with respect to underlying, Giampetruzzi action (Cmplt., ¶¶ 14; 22). More particularly,"[i]n the present case the purpose of the claimed perjury was to obtain a favorable ruling from the court on the issue to which the allegedly perjured evidence was addressed" ( Yalkowsky v. Shedler, 94 AD2d 684, 685 see, Martinson v. Blau, supra; Joseph v. Citibank, supra).
With respect to the Corcorans' second cause of action, Judiciary Law § 487 provides that an attorney who "[i]s guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive the court or any party" is guilty of a misdemeanor, and "forfeits to the party injured treble damages, to be recovered in a civil action" ( see generally, Amalfitano v. Rosenberg , 12 NY3d 8, 14-15; Rozen v. Russ Russ, P.C., ___ AD3d ___, 2010 WL 3583090 [2nd Dept. 2010]; Sound, Inc. v. Bashian Farber, LLP , 74 AD3d 1168 , 1172; Boglia v. Greenberg , 63 AD3d 973, 975 see also, Kurman v. Schnapp , 73 AD3d 435 ; Mokay v. Mokay , 67 AD3d 1210 ; Scarborough v. Napoli, Kaiser Bern, LLP , 63 AD3d 1531 ).
The purpose of the statute is to "enforce an attorney's special obligation to protect the integrity of the courts and foster their truth-seeking function" ( Amalfitano v. Rosenberg, 12 NY3d at 14),
"A violation of Judiciary Law § 487(1) may be established either by the defendant's alleged deceit or by an alleged chronic, extreme pattern of legal delinquency by the defendant" ( Rock City Sound, Inc. v. Bashian Farber, LLP, supra; Boglia v. Greenberg, supra; Izko Sportswear Co., Inc. v. Flaum , 25 AD3d 534 , 537 cf., Moormann v. Perini Hoerger , 65 AD3d 1106 ). Notably, "an injury to the plaintiff resulting from the alleged deceitful conduct of the defendant attorney is an essential element of a cause of action based on a violation of" Judiciary Law § 478 ( Rozen v. Russ Russ, P.C., supra; Boglia v. Greenberg, supra; Izko Sportswear Co., Inc. v. Flaum, supra; O'Connell v. Kerson, 291 AD2d 386; Manna v. Ads, 237 AD2d 264; Werner v. Kamal Country Club, 234 AD2d 659).
It is not necessary, however, to establish that the deceitful statement was literally credited or relied upon by the Court in order to state a claim under Judiciary Law § 487 — provided that the representation in question was "material" and actually caused the injuries or legal expenses sustained ( Amalfitano v. Rosenberg, supra, 12 NY3d at 14-15; Kurman v. Schnapp , 73 AD3d 435 ).
This is so because "in such a case, the lawsuit could not have gone forward in the absence of the material misrepresentation" and therefore, a "party's legal expenses in defending the lawsuit may be treated as the proximate result of the misrepresentation" ( Amalfitano v. Rosenberg, supra, 12 NY3d at 14-15).
With these principles in mind, and even upon favorably construing the complaint, the Court agrees that the Corcorans' Judiciary Law § 478 cause of action fails to state a claim upon which relief can be granted.
More particularly, there are lacking non-conclusory averments from which it can be reasonably inferred that the allegedly deceitful conduct represented a proximate cause of the injuries sustained ( see generally, Rozen v. Russ Russ, P.C., supra, 2010 WL 3583090; Boglia v. Greenberg, supra; Izko Sportswear Co., Inc. v. Flaum, supra; O'Connell v. Kerson, supra, 291 AD2d 386; Manna v. Ads, supra, 237 AD2d 264; Werner v. Kamal Country Club, supra, 234 AD2d 659).
A review of the Corcoran complaint establishes that the claim of deceit is predicated on the alleged perjury and/or misrepresentation with respect to Belletii's status as a licensed real estate broker (Cmplt., ¶¶ 12-13); there is no specific averment to the effect that the failure to disclose Belletti's family relationship to the Giampetruzzis was the product of deceit, fraud or perjury (Cmplt., ¶¶ 6, 19).
With respect to proximate cause and injury, the Corcorans allege that they sustained injury through, inter alia, the expenditure of unnecessary counsel fees and costs — this because the Giampetruzzis deceitfully submitted the false affidavit with the intent that the Court would rely upon it and deny the Corcorans' motion for summary judgment (Cmplt., ¶¶ 13-14; 16).
The complaint does not, however, contain factual averments adequately alleging that the submission of the Belletti affidavit proximately caused the injuries which were allegedly sustained ( Rozen v. Russ Russ, P.C., supra, 2010 WL 3583090). Although the complaint does allege that the affidavit was deceitful and submitted to defeat the Corcorans' motion, it does not contain facts which thereafter link the Belletti affidavit — which focused only upon the issue of damages — to the injuries supposedly sustained as a result, i.e., the complaint does not allege, nor can it be inferred therefrom, that "the lawsuit could not have gone forward in the absence of the material misrepresentation," so as to establish that a "party's legal expenses in defending the lawsuit may be treated as the proximate result of the misrepresentation" ( Amalfitano v. Rosenberg, supra, at 14-15; Rozen v. Russ Russ, P.C., supra).
Rather, the complaint's allegations in this respect are nebulous and inconclusive, since they merely recount in generic terms that because of the deceit, the Corcorans have — in an unspecified fashion — "been damaged in an amount yet to be determined" and also that "additional damages have and will be incurred * * * as and for legal fees in defending the [Giampetruzzi] action * * *" (Cmplt., ¶¶ 23-24).
In any event, the documents and materials submitted on the motion belie the assertion that the Belletti submission was a proximate cause of any injury sustained by the Corcorans ( Werner v. Kamal Country Club, supra, 234 AD2d at 663).
The record in this respect plainly establishes that Justice Cozzens denied the Corcorans' cross motion solely upon the ground that a question of fact had been presented with respect to the threshold issue of liability; namely, whether the Giampetruzzis' active concealment theory constituted an exception to the applicable doctrine of caveat emptor (Order at 2)( see generally, Beach 104 St. Realty, Inc. v. Kisslev-Mazel Realty, LLC , 76 AD3d 661; Laxer v. Edelman , 75 AD3d 584 ; Daly v. Kochanowicz , 67 AD3d 78 , 91-92). There is nothing in the Court's decision suggesting that the issue of damages was in any sense material to its holding or that the Giampetruzzi lawsuit "could not have gone forward in the absence of" Belletti's two and one-half page affidavit relating to the allegedly diminished value of the home ( Amalfitano v. Rosenberg, supra, 12 NY3d at 14-15 see, Werner v. Kamal Country Club, supra, 234 AD2d at 663)(Cmplt., ¶¶ 16, 23, 24).
Under these circumstances, the complaint fails to adequately allege and/or identify the existence of "an injury * * * [proximately] resulting from the alleged deceitful conduct," which is "an essential element of a cause of action based on a violation of" Judiciary Law § 478 ( Rozen v. Russ Russ, P.C., supra; Boglia v. Greenberg, supra; Izko Sportswear Co., Inc. v. Flaum, supra; O'Connell v. Kerson, supra, 291 AD2d 386; Manna v. Ads, supra, 237 AD2d 264).
The Corcorans' assertion that the Belletti affidavit was nevertheless material because it may have been submitted as part of a scheme to inflate the damages sought — and thereby improperly establish jurisdiction in the Supreme Court — is entirely speculative and lacking in probative import ( Werner v. Kamal Country Club, supra, 234 AD2d at 663).
Lastly, in the exercise of its discretion, and upon review of the parties' respective submissions, the Court declines to impose sanction upon the Corcoran or their counsel ( Retina Associates of Long Island, P.C. v. Rosberger, supra see generally, Joan 2000, Ltd. v. Deco Const. Corp., 66 AD3d 841; CLR Brooklyn Realty Corp. v. Shapiro , 39 AD3d 790 , 792; 22 NYCRR § 130-1.1).
The Court has considered the parties' remaining contentions and concludes that they are lacking in merit.
Accordingly, it is,
ORDERED that the branch of the motion by the defendants Gary and Lora Giampetruzzi which is for an order dismissing the complaint pursuant to CPLR 3211[a][7] is granted, and the motion is otherwise denied.
This constitutes the decision and order of this Court.