Opinion
2017–04204 Index No. 703189/16
04-17-2019
Melva FEGGINS, et al., Respondents, v. Jaime MARKS, Defendant, Real Estate Mortgage Network, Inc., Appellant.
Belowich & Walsh LLP, White Plains, N.Y. (Daniel G. Walsh, White Plains and Kerry Ford Cunningham of counsel), for appellant. Leavitt & Kerson, Forest Hills, N.Y. (Paul E. Kerson of counsel, New York,), for respondents.
Belowich & Walsh LLP, White Plains, N.Y. (Daniel G. Walsh, White Plains and Kerry Ford Cunningham of counsel), for appellant.
Leavitt & Kerson, Forest Hills, N.Y. (Paul E. Kerson of counsel, New York,), for respondents.
JOHN M. LEVENTHAL, J.P., SHERI S. ROMAN, JOSEPH J. MALTESE, ANGELA G. IANNACCI, JJ.
DECISION & ORDER ORDERED that the order is affirmed insofar as appealed from, with costs.
The plaintiffs are the half-sisters of the defendant Jaime Marks. Their mother, Olivia Marks (hereinafter the decedent), owned certain real property in Queens. By deed dated April 7, 2010, the decedent conveyed title to the subject property from her, as sole owner, to her and Jaime, as joint tenants with a right of survivorship. On August 26, 2011, the decedent and Jaime obtained a loan secured by a mortgage on the property from the defendant Real Estate Mortgage Network, Inc. (hereinafter the appellant). On August 21, 2012, the decedent died.
Thereafter, the plaintiffs commenced this action, inter alia, to set aside the deed and to cancel the mortgage on the grounds of undue influence and fraud. The appellant moved pursuant to CPLR 3211(a)(1), (3), and (7) to dismiss the complaint insofar as asserted against it. The Supreme Court denied the motion.
We agree with the Supreme Court's determination to deny the appellant's motion to dismiss the complaint insofar as asserted against it. On a motion to dismiss a complaint, the pleading is to be afforded a liberal construction, the court is to determine only whether the facts as alleged fit within any cognizable legal theory, and the facts pleaded are presumed to be true and are to be accorded every favorable inference (see Leon v. Martinez, 84 N.Y.2d 83, 87–88, 614 N.Y.S.2d 972, 638 N.E.2d 511 ; Thomas v. Lasalle Bank N.A., 79 A.D.3d 1015, 1017, 913 N.Y.S.2d 742 ; Salvatore v. Kumar, 45 A.D.3d 560, 563, 845 N.Y.S.2d 384 ). Further, " ‘a court may freely consider affidavits submitted by the plaintiff to remedy any defects in the complaint’ " ( McGuire v. Sterling Doubleday Enters., L.P. , 19 A.D.3d 660, 661, 799 N.Y.S.2d 65, quoting Leon v. Martinez, 84 N.Y.2d at 88, 614 N.Y.S.2d 972, 638 N.E.2d 511 ; see Rovello v. Orofino Realty Co. , 40 N.Y.2d 633, 635, 389 N.Y.S.2d 314, 357 N.E.2d 970 ). "[W]here evidentiary material is adduced in support of the motion, the court must determine whether the proponent of the pleading has a cause of action, not whether the proponent has stated one" ( Peter F. Gaito Architecture, LLC v. Simone Dev. Corp. , 46 A.D.3d 530, 530, 846 N.Y.S.2d 368 ; see Meyer v. Guinta, 262 A.D.2d 463, 464, 692 N.Y.S.2d 159 ). A motion to dismiss based on documentary evidence may appropriately be granted "only where the documentary evidence utterly refutes plaintiff's factual allegations, conclusively establishing a defense as a matter of law" ( Goshen v. Mutual Life Ins. Co. of N.Y. , 98 N.Y.2d 314, 326, 746 N.Y.S.2d 858, 774 N.E.2d 1190 ; see Leon v. Martinez, 84 N.Y.2d at 88, 614 N.Y.S.2d 972, 638 N.E.2d 511 ; Lucia v. Goldman, 68 A.D.3d 1064, 1065, 893 N.Y.S.2d 90 ; Mazur Bros. Realty, LLC v. State of New York, 59 A.D.3d 401, 402, 873 N.Y.S.2d 326 ).
A mortgagee's interest in the property is not protected if the mortgagee had notice of a previous fraud affecting the title of its grantor (see Real Property Law § 266 ; Mathurin v. Lost & Found Recovery, LLC, 65 A.D.3d 617, 618, 884 N.Y.S.2d 462 ; LaSalle Bank Natl. Assn. v. Ally, 39 A.D.3d 597, 599–600, 835 N.Y.S.2d 264 ). "[A] mortgagee is under a duty to make an inquiry where it is aware of facts ‘that would lead a reasonable, prudent lender to make inquiries of the circumstances of the transaction at issue’ " ( Stracham v. Bresnick, 76 A.D.3d 1009, 1010, 908 N.Y.S.2d 95, quoting LaSalle Bank Natl. Assn. v. Ally, 39 A.D.3d at 600, 835 N.Y.S.2d 264 ). "A mortgagee who fails to make such an inquiry is not a bona fide encumbrancer for value" ( Booth v. Ameriquest Mtge. Co., 63 A.D.3d 769, 769, 881 N.Y.S.2d 152 ). Here, considering the complaint and all evidentiary material submitted, including the medical records of the decedent, the plaintiffs have a cause of action to cancel the subject mortgage on a theory that the appellant is not a bona fide encumbrancer for value, and the documentary evidence did not conclusively establish, as a matter of law, that the appellant was a bona fide encumbrancer for value (see Lucia v. Goldman, 68 A.D.3d at 1065–1066, 893 N.Y.S.2d 90 ; Mathurin v. Lost & Found Recovery, LLC, 65 A.D.3d at 618, 884 N.Y.S.2d 462 ; cf. LaSalle Bank Natl. Assn. v. Ally, 39 A.D.3d at 600, 835 N.Y.S.2d 264 ).
The appellant's remaining contentions are without merit.
LEVENTHAL, J.P., ROMAN, MALTESE and IANNACCI, JJ., concur.