Opinion
# 2017-050-045
09-26-2017
IN THE MATTER OF THE APPLICATION OF ROBERT FREDERICK AND GEORGE WILLIAM BECKER, AS EXECUTOR OF THE ESTATE OF MARILYN BECKER FOR AN ORDER DIRECTING DISTRIBUTION OF A SUM DEPOSITED PURSUANT TO §304 OF THE EMINENT DOMAIN PROCEDURE LAW v. MUSTAMED ASSOCIATES, INC.; LEON PETROLEUM, LLC; INDEPENDENCE COMMUNITY BANK; NEW YORK STATE COMMISSIONER OF TAXATION AND FINANCE; SUFFOLK COUNTY TREASURER; VILLAGE OF LAKE GROVE; CERTILMAN, BALIN, ADLER & HYMAN, LLP; THOMAS P. DINAPOLI, CO[MP]TROLLER AND ERIC T. SCHNEIDERMAN, ATTORNEY GENERAL
Dranitzke, Lechtrecker, Trabold & Johnson, Esqs. By: Edward M. Johnson, Esq. For Respondent Hon. Eric T. Schneiderman, Attorney General of the State of New York and Thomas P. DiNapoli, Comptroller of the State of New York: Hon. Eric T. Schneiderman, Attorney General of the State of New York By: Michele M. Walls, Assistant Attorney General For Respondents Certilman, Balin, Adler & Hyman, LLP: Certilman, Balin, Adler & Hyman, LLP By: Rebecca Sklar, Esq. For Respondent Suffolk County Treasurer: Dennis M. Brown, Suffolk County Attorney By: Marlene L. Budd, Assistant County Attorney
Synopsis
By their application by Order to Show Cause, petitioners seek to recover a portion of funds on deposit under an Eminent Domain Account. The petition is granted to the extent that petitioners are awarded the amount stated herein.
Case information
| UID: | 2017-050-045 |
| Claimant(s): | IN THE MATTER OF THE APPLICATION OF ROBERT FREDERICK AND GEORGE WILLIAM BECKER, AS EXECUTOR OF THE ESTATE OF MARILYN BECKER FOR AN ORDER DIRECTING DISTRIBUTION OF A SUM DEPOSITED PURSUANT TO §304 OF THE EMINENT DOMAIN PROCEDURE LAW |
| Claimant short name: | FREDERICK |
| Footnote (claimant name) : | |
| Defendant(s): | MUSTAMED ASSOCIATES, INC.; LEON PETROLEUM, LLC; INDEPENDENCE COMMUNITY BANK; NEW YORK STATE COMMISSIONER OF TAXATION AND FINANCE; SUFFOLK COUNTY TREASURER; VILLAGE OF LAKE GROVE; CERTILMAN, BALIN, ADLER & HYMAN, LLP; THOMAS P. DINAPOLI, CO[MP]TROLLER AND ERIC T. SCHNEIDERMAN, ATTORNEY GENERAL |
| Footnote (defendant name) : | |
| Third-party claimant(s): | |
| Third-party defendant(s): | |
| Claim number(s): | NONE |
| Motion number(s): | SP-189 |
| Cross-motion number(s): | |
| Judge: | STEPHEN J. LYNCH |
| Claimant's attorney: | Dranitzke, Lechtrecker, Trabold & Johnson, Esqs. By: Edward M. Johnson, Esq. |
| Defendant's attorney: | For Respondent Hon. Eric T. Schneiderman, Attorney General of the State of New York and Thomas P. DiNapoli, Comptroller of the State of New York: Hon. Eric T. Schneiderman, Attorney General of the State of New York By: Michele M. Walls, Assistant Attorney General For Respondents Certilman, Balin, Adler & Hyman, LLP: Certilman, Balin, Adler & Hyman, LLP By: Rebecca Sklar, Esq. For Respondent Suffolk County Treasurer: Dennis M. Brown, Suffolk County Attorney By: Marlene L. Budd, Assistant County Attorney |
| Third-party defendant's attorney: | |
| Signature date: | September 26, 2017 |
| City: | Hauppauge |
| Comments: | |
| Official citation: | |
| Appellate results: | |
| See also (multicaptioned case) |
Decision
This Court signed an Order to Show Cause on April 25, 2017 bringing on this special proceeding for a final order of distribution of funds from Eminent Domain Account number W060559. That Order to Show Cause was made returnable on July 14, 2017 and required that service be effected upon certain "interested parties" - as identified in said order - on or before June 5, 2017. Under cover letter to the Court dated May 24, 2017, the petitioners' attorney submitted seven original affidavits of service (together with the original Order to Show Cause). Also included with said May 24, 2017 letter from petitioners' attorney was a copy of correspondence dated June 5, 2017 from an Assistant Attorney General of the State of New York clearly stating that the Attorney General's Office accepted service of the Order to Show Cause on behalf of the Office of the Comptroller, the State of New York and the Office of the Attorney General.
The respondents, Thomas P. DiNapoli, Comptroller of the State of New York, Eric T. Schneiderman, Attorney General of the State of New York and New York State Commissioner of Taxation and Finance (collectively, the State respondents) interposed an answer to the petition (upon which the Order to Show Cause was issued) dated July 6, 2017 (filed July 7, 2017).
The respondent Certilman, Balin, Adler & Hyman, LLP (Certilman) filed a "verified petition" - within the instant proceeding and under the caption hereof - on July 3, 2017. The verified petition of Certilman was accompanied by proof of its service on June 30, 2017. The State respondents filed a separate answer to Certilman's petition on July 7, 2017.
An additional proof of service was filed by Certilman on July 17, 2017 under cover letter dated July 12, 2017.
The Suffolk County Treasurer filed a Notice of Appearance on July 17, 2017 (after the return date of the instant Order to Show Cause) reflecting service of such Notice of Appearance upon petitioners' attorney only on July 12, 2017.
Upon the return date of the instant Order to Show Cause, July 14, 2017, the Court was in session at the hour set in the instant Order to Show Cause, 11:00 a.m. There were no appearances made by counsel or by any party at that time. The application was deemed submitted as of said date. By their application by Order to Show Cause, petitioners seek to recover a portion of funds on deposit under Eminent Domain Account No. W060559 (as detailed, infra).
This is a Special Proceeding to determine the distribution of an advance payment made in connection with the February 2007 appropriation of real property located in Suffolk County, New York. Because the Attorney General determined that there are multiple parties who might be able to claim an interest in the property, the Comptroller was asked to deposit this advance payment in a special interest-bearing account pursuant to EDPL § 304 (E) (1). The money was placed in Eminent Domain Account No. W060559. This proceeding, initiated by two of the identified interested parties, is for an order directing the distribution of a portion of those funds.
Several years prior to the appropriation, on May 17, 2001, the subject property was conveyed to Mustamed Associates, Inc., by Robert Frederick and Marilyn Becker. At that same time, Paul Kaya a/k/a Mustafa Kayaseleuk, President of Mustamed Associates, Inc., conveyed to Frederick and Becker a $417,500.00 mortgage secured by two mortgage notes: one from Mustamed Associates, Inc. in the amount of $357,500.00 and the other from Paul Kaya a/k/a Mustafa Kayaseleuk in the amount of $60,000.00.
In March 2010, Marilyn Becker died. Letters Testamentary were issued to George William Becker as Executor of her estate.
The third page, at paragraph 13, of the mortgage document contains the following provision:
"[The mortgagor hereby mortgages to the mortgagee] . . . all awards heretofore and hereafter made to the mortgagor for taking by eminent domain the whole or any part of said premises or any easement therein . . . which said awards are hereby assigned to the mortgagee who is hereby authorized to collect and receive the proceeds of such awards and to give proper receipts and acquittance therefor, and to apply the same toward the payment of the mortgage debt, notwithstanding the fact that the amount owing thereon may not then be due and payable . . ."
In addition, paragraph EE of the mortgage rider provides as follows:
"In the event any part of the within described Premises be condemned by governmental authorities or if a deed in lieu of condemnation shall be given to the governmental authorities, all consideration received by the Mortgagor up to the amount secured hereby, shall be paid to the Mortgagee as consideration for the release of such condemned property from the lien of this mortgage after first applying such sums as are necessary to restore the Premises."
According to Petitioners, Mustamed Associates, Inc. and Paul Kaya a/k/a Mustafa Kayaseleuk have failed to make any of the payments that have become due since June 18, 2008.
In a prior proceeding which was commenced in March 2014 under special proceeding number SP-165, the Honorable Richard E. Sise, Acting Presiding Judge of this Court, determined in his decision and order filed July 22, 2014 that the petitioners herein (also petitioners in SP-165) were awarded the full amount then on deposit in account W060559, the Court finding in SP-165 that the amount claimed to be owed to petitioners - $62,602.51 (as of the time of that earlier proceeding) - exceeded the amount then on deposit in said account W060559. By the present application, the petitioners seek recovery of a portion of a second payment made by the Comptroller to account W060559 on October 19, 2015. That account is alleged to now contain $98,318.79 ($54,700.00 deposited on October 19, 2015 and interest of $43,618.79 for a total of $98,318.79 as of April 10, 2017). The object of the present application then is to recover essentially the amount of the deficiency between the amount yielded by petitioners through special proceeding SP-165 and the total amount currently owed to petitioners under the subject notes and mortgages. Specifically, petitioners acknowledge that they received ("yielded") $49,103.90, through the prior application determined by Judge Sise (see supra). They aver that they were owed $68,107.22 and now seek the difference - $19,003.32 - plus $3,420.60 in "interest due through November 17, 2016."
In this context where no party respondent identified as having an interest (in the appropriated property or the fund constituting the Eminent Domain account W060599) has opposed the application by petitioners for a portion (to wit, $ 22,423.92) of the funds now on account under Eminent Domain account W060559 (presently appearing to approach or exceed $100,000.00), the petition must be and is hereby granted to the extent that petitioners are awarded the amount claimed, $22,423.92 plus interest per diem from and after November 18, 2016, at a per diem rate of $4.75 to the date of payment by the Comptroller to petitioners of the sum required herein. With regard to petitioners' further request for an award for $5,000.00 in legal fees, the Court notes that except for proceedings under EDPL § 701 or pursuant to CPLR 3126 and 8303-a, costs and attorneys fees are not available in the Court of Claims (see CCA § 27).
This amount is comprised of the principal balance of $19,003.32 plus interest due through November 17, 2016 in the sum of $3,420.60.
Accordingly, the Comptroller of the State of New York is directed to distribute and pay to petitioners from the account W060559 the sum of $22,423.92 together with interest in an amount calculated at $4.75 per diem from November 18, 2016 to the date of actual payment by the Comptroller of the sums required hereunder; the remainder on deposit in account W060559 - following payment of the sums required to be paid to petitioners under this decision and order - shall remain on deposit in account W060559.
The separate verified petition of Certilman is denied without prejudice to Certilman seeking the same relief by Order to Show Cause.
September 26, 2017
Hauppauge, New York
STEPHEN J. LYNCH
Judge of the Court of Claims The following papers were read and considered by the Court on the Order to Show Cause: 1. Order to Show Cause dated April 25, 2017, Verified Petition with Exhibits and Supporting Papers including Supplemental Affirmation dated April 25, 2017 and a letter dated May 24, 2017 enclosing sworn affidavits of service; 2. Verified Answer of State Respondents to Petition and Supporting papers; 3. Verified Petition of Certilman, Balin, Adler & Hyman, LLP and supporting papers; 4. Verified Answer of State Respondents to Certilman, Balin, Adler & Hyman, LLP's verified Petition and supporting papers; 5. Notice of Appearance of Suffolk County Treasurer and supporting papers; 6. Certilman, Balin, Adler & Hyman, LLP's letter dated July 12, 2017 and supporting papers.