Opinion
008898 / 2010
04-09-2013
Fire Island Real Estate, Inc., Plaintiff(s) v. Coldwell Banker Residential Brokerage and MITCHELL J. LEVY, Defendant(s)
Scott Hirsch, Esq. Hirsch & Hirsch Esqs Attorneys for Plaintiff Philip Pierce Esq Margolin & Pierce Esqs Attorneys for Defendants
Scott Hirsch, Esq. Hirsch & Hirsch Esqs Attorneys for Plaintiff
Philip Pierce Esq Margolin & Pierce Esqs Attorneys for Defendants
Andrew G. Tarantino, J.
NATURE OF THE ACTION
Plaintiff, Fire Island Real Estate (F.I.R.E.) brought this action against Defendants, Coldwell Banker Residential Brokerage (COLDWELL) and Mitchell Levy, for commissions it believed it earned from the transaction of a real estate deal. In its opening statement, Plaintiff's counsel argued tortious interference with a contract, unjust enrichment, and constructive trust. Defendant's counsel argued that COLDWELL had an exclusive agreement with the homeowners to sell the residence, a COLDWELL sign was on the property, and the purchaser telephoned COLDWELL after seeing the sign to place a bid on the property. The action was transferred to this Court, pursuant to NY Civ. Pract. Laws & Rule §325(d), and a trial without jury was conducted.
PLEADINGS
The Complaint alleged that Defendant Mitchell Levy was an employee and agent of Defendant COLDWELL. F.I.R.E. alleged that in May 2007 it was a listing broker for property identified as 500 Bayberry. It alleged it originally introduced the purchaser, Weinstein, to the property and, as a result, Weinstein purchased the property from former owners, Mishkin and Mahnken. F.I.R.E. asked for the full commission of $28,000.00, and in no event less than 50% of the commission.
Defendant COLDWELL filed a Verified Answer alleging it was the listing agent pursuant to a written agreement with the property owners. It also alleged that if the allegations were true, then Plaintiff's recourse would be against the former owners of the property. Lastly, Defendant COLDWELL alleged that Plaintiff did not plead a viable claim against Levy who was an employee of COLDWELL.
TESTIMONY
F.I.R.E. president Carin Roth testified first. Roth was, and remains, a licensed real estate broker and has worked in the community for 40 years. F.I.R.E. was first approached by the 500 Bayberry owners to rent the house in 2003. F.I.R.E. then listed the rental from 2003 through 2007. According to Roth, in May 2007, the owners completed a sales registry and, between May and September 2007, F.I.R.E. showed the property about 21 times to various persons. Ellen Weinstein was then a prospective buyer who Roth claimed was shown the property 4 times, the first being in September 2007. Roth stated that when Weinstein first appeared in the F.I.R.E. office, Weinstein had copies of the F.I.R.E. website listings in her hands. The subject house listed for $525,000.00; Weinstein offered $465,000.00. Roth stated she communicated the offer to the owners by telephone and kept leaving messages for about 10 days without receiving a reply. On cross-examination, Roth conceded that she worked on "open" listings in the community. She also acknowledged seeing the Coldwell Banker Residential Brokerage sign on the property. Roth claimed that one of the owners, Mishkin, first returned her calls after 10 days at which time Mishkin told Roth he would convey Weinstein's offer to his partner Mahnken. Roth acknowledged that during those ten days Weinstein called F.I.R.E. every 2-3 days, but Roth did not take any of Weinstein's calls. Although Roth believed she conveyed Weinstein's offer to Mishkin in writing she could not locate any such writing.
Plaintiff's next witness was Ellen Weinstein. She is the current owner of 500 Bayberry which she purchased in February 2008. In 2007 she was looking for property and walked into the F.I.R.E. office. She did not recall having any listings in her hands. She stated that no one from F.I.R.E. ever showed her 500 Bayberry. Weinstein stated that the first time she saw the house was on her own. After looking at the house on her own, she then went to the F.I.R.E. office with whom she had previous dealings. Upon further questioning, she recalled later being driven around the community by a F.I.R.E. broker to look at other houses. As Roth and the Weinsteins were passing 500 Bayberry Mr. Weinstein asked to stop and look at the house. Otherwise, according to Weinstein, the F.I.R.E. broker demonstrated no intention of stopping to show Weinstein the property and, in fact, the F.I.R.E. broker told Weinstein that the house would not pass inspection and was considered a tear-down. Weinstein recalled seeing the COLDWELL sign on the property. Weinstein said she asked F.I.R.E. to offer $450,000.00 for the house. In the days that followed, Weinstein called F.I.R.E. frequently but her calls were not returned. After ten (10) days passing without receiving any information from F.I.R.E., Weinstein called COLDWELL directly. She was asked by Mr. Levy to view the house again. Weinstein's bid was conveyed by COLDWELL to the owners. Ultimately, the house did pass inspection, and she is the current owner. Weinstein stated that she did not feel that F.I.R.E. did anything towards helping her purchase the property. On cross-examination she described that when her husband asked to stop and look at 500 Bayberry, Roth did not even get out of the golf cart and Weinstein described Roth as being very disinterested in the property. Instead, Weinstein added that Roth continued talking about houses which Weinstein could not afford. At no time was she able to get confirmation that F.I.R.E. conveyed her offer to the owners of 500 Bayberry. Although she conveyed an offer of $450,000.00 for the house through COLDWELL, the final purchase price negotiated through COLDWELL was $475,000.00. After the engineer's inspection, and with COLDWELL's assistance, the price was reduced $10,000.00. Weinstein said that F.I.R.E. never had anything to do with this transaction.
Plaintiff's last witness was Abigail Medvin. An employee of F.I.R.E., she met Weinstein in September 2007. Medvin claimed she brought Weinstein to 500 Bayberry the first day, and walked together through the house. She added that Weinstein then re-visited the house several times more. Medvin described how Weinstein first offered to buy the Bogart house (no relation to Humphrey), but after that fell through Weinstein made the offer on 500 Bayberry. Medvin then said she made "several" calls to owner Mishkin. On cross-examination, Medvin admitted she never reached Mishkin. On cross-examination by the Court, because of the similarity in appearance between Medvin and Roth, Medvin acknowledged that she was Roth's daughter. Neither party followed up from the Court's inquiry although offered the opportunity.
Defendant called Mitch Levy to testify. He has been in real estate sales since 2005, and was employed at COLDWELL in 2007. Levy produced a document signed in July 2007 purporting to have registered 500 Bayberry with an "exclusive right to sell" until July 2008. Levy first heard from Weinstein in October 2007. He asked Weinstein if she had any agreements with another broker to which she replied she did not. Levy participated in the negotiations between Weinstein and the owners, and recalls reducing the price $10,000.00 after issues were raised in the engineer's report.
DOCUMENTS
Plaintiff provided several documents. First was a 2003 Rental Registry listing only Mahnken as the owner. It appeared to be a F.I.R.E. internal document listing the rental period as May through September 2003, and listing the amenities in the house. Next was a Sales Registry, again a F.I.R.E. internal document. Dated May 12, 2007, this document had both Mahnken's and Mishkin's names listed as owners, and set forth an asking price of $525,000.00. The space next to "commission" was left blank. Except for indicating the amenities at the property, the Sales Registry did not set forth any obligations imposed upon the then owners or F.I.R.E.. It is not signed by either owner. The next documents were several Buyer Customer Sheets. One, dated September 9, 2007, reflected Weinstein's name at the top, and appeared to have a signature at the bottom. Its contents check off the types of houses in which the buyer was interested, and under the category "houses shown" there were three listed: the Bogart house, 490 Bayberry and 500 Bayberry. The remaining Buyer Customer Sheets were for other buyers dated from May 2007 though September 2007. Upon each under the category "Houses Shown" was listed 500 Bayberry. Lastly, Plaintiff submitted the examination before trial of Ellen Weinstein taken October 5, 2010. In it, Weinstein stated she first saw 500 Bayberry with a realtor Nancy Meyer. No offer was made. When Weinstein and her husband were driven around by Roth, the husband asked Roth to stop at 500 Bayberry. She described how Roth was disinterested in 500 Bayberry, called it a knock-down, and remained in her cart while the Weinsteins walked through the house alone. After asking Roth to convey an offer to the owners. Weinstein called Roth every day. Roth did not take Weinstein's calls. After several days, Roth called Weinstein only to try to sell her another property. Weinstein could not confirm whether Roth conveyed Weinstein's offer to the owners.
Defendant's evidence included the listing agreement signed by Mahnken and Mishkin. It was signed July 31, 2007, and reflected a termination date of July 31, 2008. The Broker was listed as Coldwell Banker Residential. Although captioned "exclusive right to sell," the agreement authorized the broker to enter the property data in the Multiple Listing Service of Long Island (MLSLI). It then provided the broker authorization to cooperate with agents who represent buyers. "Exclusive Right to Sell" is defined in the agreement as:
"..if you, the Owner(s) of the property, find a buyer for your house, or if another broker finds a buyer, you must pay the agreed commission to the present broker."Attached were several pages of property data, and disclosure forms, followed by the Weinstein Sales Agreement dated October 28, 2007. It reflected a purchase price of $475,000.00. The transaction closed February 27, 2008, and a commission of $23,250.00 was paid to Coldwell Banker.
LAW AND DISCUSSION
The Plaintiff presented the Court with four (4) issues:
1) Was there a breach of contract by COLDWELL?Defendants presented the Court with two (2) issues:
2) Did COLDWELL tortiously interfere with F.I.R.E.'s contract with the owners?
3) Was COLDWELL unjustly enriched by the subject transaction?
4) Was a constructive trust established when COLDWELL was paid its commission on the closing of the transaction?
1) Whether Plaintiff failed to plead any cause of action in its case?The elements of a cause of action for breach of contract are: (1) formation of a contract between the parties: (2) performance by plaintiff; (3) defendant's failure to perform; and (4) resulting damage. T.H. Cheshire & Sons, Inc. v. Berry, 37 Misc 3d 1220(A), Slip Copy, 2012 WL 5512544 (Table) N.Y.Co.Ct.,2012, citing, Furia v. Furia, 116 AD2d 694, 498 N.Y.S.2d 12 (2d Dept 1986). The elements of a cause of action for tortious interference with business relations, or contract, are as follows: (1) the plaintiff's business relations with a third party; (2) the defendant's interference with those business relations; (3) the defendant acted with the sole purpose of harming the plaintiff or used wrongful means; and (4) injury to the business relationship. Deer Consumer Products Group Inc. v. Little Group, 37 Misc 3d 1224(A), 2012 WL 5898052 (N.Y.Sup., Nov. 2012). Plaintiff must also show that the defendant's conduct was motivated solely by malice or to inflict injury by unlawful means. Deer Consumer Products Group Inc. v. Little Group, id. Where it is sought to recover loss based on alleged tortious interference with contract, party must allege at least that it would have received contract except for such interference. Williams & Co. v. Collins, Tuttle and Company, 6 AD2d 302, 176 N.Y.S.2d 99 (1st Dept, 1958).In applying this principle the question then is whether the negotiations with the prospect must have reached virtual consummation, or whether it is sufficient that it would have concluded the contract although negotiations fell short on consummation only because of the tortious interference. Williams & Co. v. Collins, Tuttle and Company, id.The elements of a cause of action for a constructive trust are: (1) a confidential or fiduciary relation; (2) a promise, express or implied; (3) a transfer made in reliance on that promise; and (4) unjust enrichment. Genger v. Genger, 38 Misc 3d 1213(A), 2013 WL 221485 (Jan 2013). In order to plead a cause of action for unjust enrichment, a plaintiff must allege that (1) the other party was enriched, (2) at that party's expense, and (3) that it is against equity and good conscience to permit the other party to retain what is sought to be recovered. Genger v Genger, id.
2) Whether Plaintiff failed to name a party necessary to this litigation?
NY Civ. Pract. Laws & Rules § 1001(a) provides that "parties who should be joined" in an action include those "who might be inequitably affected by a judgment in the action." San Dar Associates v. Fried, Slip Copy, 2012 WL 6097689 (Table) N.Y.Sup.,2012.Motion to dismiss for failure to join necessary parties was properly denied where none of the parties defendant sought to have joined was necessary for complete relief to be accorded between the persons who were parties to the action, nor would any be inequitably affected by a judgment in the action. Flanagan v. Board of Ed., Commack Union Free School Dist., 56 AD2d 574, 391 N.Y.S.2d 180 (2 Dep't 1977).
The Court dismisses the Defendants' affirmative defense that Plaintiff failed to name a party necessary to the litigation. If F.I.R.E. succeeds with its claims against COLDWELL, the former owners will not be inequitably affected by a judgment in this action. Although one might question why the former owners were not named as parties, especially because the Plaintiff alleged a contract with them, the Court cannot step into the Plaintiff's mind and opine on its litigation strategy. One can further question why, at a minimum, the Plaintiff did not call one of the former owners to testify about the purported listing agreement which Plaintiff alleged it had. Here too, it was a strategy elected by Plaintiff. Because the former owners would not be affected by a judgment in this action the Court finds that it was not necessary to name the former owners as parties to this action.
Next, the Court dismisses Plaintiff's claim against Defendants sounding in breach of contract. By Plaintiff's own testimony, any contract which may have existed would have been between Plaintiff and the former owners. There was no evidence any agreement by and between Plaintiff and Defendants.
Next, the Court dismisses Plaintiff's claim that Defendants tortiously interfered with a contract. First, Plaintiff failed to establish a contract between it and the former owners. The sole evidence submitted by Plaintiff was the Sales Registry it claimed was signed by the former owners. The Court does not consider the document a contract primarily for omission of a critical element. Besides being devoid of any obligations imposed upon either Plaintiff or the former owners, there was no consideration. Specifically, next to the item labeled as "commission" there was no dollar amount. The document was a two-edged sword: it failed to meet the elements of a contract thereby defeating an essential element in this cause of action; and, if it was a contract as Plaintiff purported, then the contract provided for no commission thereby defeating Plaintiff's overall claim that it was entitled to any payment for its purported services. Assuming, arguendo, the Sales Registry was a contract, Plaintiff also failed to show that Defendants interfered with that contract. It is a known and customary practice that several brokers might attempt to procure buyers for properties on the multiple listing service. There was no showing that Defendants did anything more than procure such a buyer. Lastly, Plaintiff failed to provide an indicia of evidence that Defendants' conduct was motivated solely by malice or to inflict injury upon Plaintiff by unlawful means. Plaintiff's claim for tortious interference with a contract was defective.
Next, the Court dismisses the Plaintiff's claim that Defendants were unjustly enriched. While it is undisputed that Defendants were enriched by the commission it received from this transaction, Plaintiff failed to show that it was at the Plaintiff's expense. Notwithstanding the issues addressed above, Weinstein testified that Plaintiff did not even want to show her the subject property. Moreover, Plaintiff offered no proof that it conveyed Weinstein's offer to the former owners and Plaintiff acknowledged that for more than 10 days it did not take any of Weinstein's telephone calls. In Weinstein's words, "Fire Island Real Estate did nothing."
Lastly, the Court dismisses the Plaintiff's claim that a constructive trust was created. Plaintiff offered no evidence, testimonial or documentary, that there was a confidential or fiduciary relationship between Plaintiff and Defendants. Quite the contrary, the parties were competitors in an obviously lucrative and volatile market. Plaintiff also failed to offer any proof of a promise made by Defendants upon which Plaintiff acted upon in reliance. To even suggest that a promise was made by Defendants is belied by the testimony which showed that there were no communications between Plaintiff and Defendants regarding this transaction or about Weinstein. This claim, too, failed.
In a matter such as this, it is the province and indeed the obligation of the trial court to assess and determine matters of credibility. Morgan v. McCaffrey, 14 AD3d 670, 789 N.Y.S.2d 274 (2d Dept 2005); Matter of Liccione v. John H., 65 NY2d 826, 493 N.Y.S.2d 121 (1985). The burden is upon Plaintiff to plead and prove its direct case by a fair preponderance of the credible evidence. Prince—Richardson on Evidence, § 3-210; Torem v. 564 Central Avenue Rest, 133 AD2d 25, 518 N.Y.S.2d 620 [1st Dept 1987]. Credible evidence has been defined as evidence that proceeds from a credible source and reasonably tends to support the proposition for which it is offered and is evidentiary in nature and not merely a conclusion of law, nor mere conjecture. Baudille v. Kelly, 31 Misc 3d 1232(A) (NY Supreme, NY County, 2011). The burden of proving the existence of a contract and performance according to its terms is upon the party suing for damages for its breach. Fisch on New York Evidence, Second Edition, § 1098, Lond Publications 1977/2008. Based upon the testimony and demeanor of the witnesses during the taking of testimony, the Court discredits Plaintiff's witnesses. Roth's testimony was conclusory and self-serving, and the documents submitted fell short of supporting any cognizable claim. Medvin's testimony also is discredited. Her apparent bias to support her mother's claims was compounded by the secretive nature of their relationship. Medvin's testimony, also, lacked specificity. The Court fully credits Weinstein's testimony. Weinstein demonstrated on the witness stand a confidence in her recollection of events. Moreover, upon reading Weinstein's examination before trial submitted by the Plaintiff, Weinstein's testimony on the day of trial was virtually consistent with her testimony given over two years ago.
Plaintiff failed to plead and prove its direct case by a fair preponderance of the credible evidence. The complaint is dismissed. As for Defendant Levy, he was an employee of Defendant and acted within the scope of his employment. The Court finds no viable claim which Plaintiff can sustain against Defendant Levy.
This constitutes the decision and order of the Court.
Submit judgment.
ENTER
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Judge