Opinion
2017-836/H
09-19-2019
In the MATTER OF the Application of William E. KOUGHN, in Accordance with SCPA 2102 to Compel Payment, and alternatively to Remove Steven Daniel Mahoney and George David Mahoney, as Co-Executors of the Estate of Joan F. Mahoney, and as Co-Trustees of the Trust for the Benefit of William E. Koughn.
Appearances: Richard D. Cirincione, Esq., Co-Counsel for Petitioner William E. Koughn, McNamee Lochner P.C., Albany Christina Tangredi, Esq., Co-Counsel for Petitioner William E. Koughn, West Sand Lake William F. Ryan, Jr., Esq., Attorney for Respondents George D. Mahoney and Steven D. Mahoney, Tabner, Ryan & Keniry, LLP, Albany
Appearances: Richard D. Cirincione, Esq., Co-Counsel for Petitioner William E. Koughn, McNamee Lochner P.C., Albany
Christina Tangredi, Esq., Co-Counsel for Petitioner William E. Koughn, West Sand Lake
William F. Ryan, Jr., Esq., Attorney for Respondents George D. Mahoney and Steven D. Mahoney, Tabner, Ryan & Keniry, LLP, Albany
Stacy L. Pettit, J.
Pending before this Court is petitioner William E. Koughn's motion for summary judgment on his petition to compel payment or, alternatively, to remove respondents Steven Mahoney and George Mahoney as co-executors of the estate of Joan F. Mahoney (hereinafter decedent) and as co-trustees of the testamentary trust for the benefit of petitioner.
Petitioner commenced this proceeding pursuant to SCPA 2102 (4) seeking to compel respondents to pay him two past due $50,000 distributions, plus interest at the statutory rate, as well as a payment of $1,500 for expenses as ordered in the Mental Hygiene article 81 guardianship proceeding for decedent which appointed George Mahoney as guardian. Respondents answered, asserting certain defenses to the petition. Petitioner moved for summary judgment, arguing that the defenses are meritless and insufficient as a matter of law. Respondents opposed the motion and the matter is now submitted for decision.
Generally, "legacies are payable seven months after issuance of letters testamentary unless otherwise directed by the testator or required by the circumstances of the estate" ( Matter of Usdan , 125 Misc. 2d 494, 495, 480 N.Y.S.2d 81 [Sur. Ct., Nassau County 1984] ; see EPTL 11—1.5 ; Matter of Matz , 12 Misc. 2d 966, 974, 173 N.Y.S.2d 880 [Sur. Ct., N.Y. County 1958] ). If such legacies are not paid, SCPA 2102 (4) provides for a proceeding against a fiduciary to, among other things, "pay a legacy, distributive share, interest in a trust or a claim for an administration expense." "[U]nder certain circumstances an executor may retain a disposition as a set off of a debt owed by the beneficiary to the decedent or the estate" ( Matter of Marsh , 2006 N.Y. Slip Op. 52077[U], 13 Misc. 3d 1231[A], 2006 WL 3069296, *3 [Sur. Ct., Westchester County 2006] ; see Matter of Marsh , 106 A.D.3d 1009, 1012, 966 N.Y.S.2d 456 [2d Dept. 2013] ; Matter of Voice , 38 Misc. 2d 779, 784, 238 N.Y.S.2d 736 [Sur. Ct., N.Y. County 1963], affd 19 A.D.2d 945, 245 N.Y.S.2d 310 [1st Dept. 1963] ; Matter of Grifenhagen , 168 Misc. 568, 570-571, 6 N.Y.S.2d 189 [Sur. Ct., N.Y. County 1938] ). It has been noted that "reason and equity dictate that if the amount of the debt due the estate is known and can be determined and is significantly smaller when compared to the amount of the legacy itself then at least partial payment on account of the legacy should be considered" (Matter of Cole , 1989 NYLJ LEXIS 3868, *4 [Sur. Ct., Westchester County 1989]).
Turning first to the two $50,000 testamentary trust distributions which petitioner seeks, the Court finds that petitioner has made a prima facie showing of entitlement to judgment as a matter of law with respect to these payments (see Matter of Epstein , 155 A.D.3d 729, 729, 64 N.Y.S.3d 69 [2d Dept. 2017] ). Petitioner is the beneficiary of a trust under paragraph (f) of article 15 of the will. The terms of the will direct payment to petitioner of $50,000 each January after her death for five years unless petitioner dies, becomes incompetent, or resides in a nursing home or long-term care facility. At this time, two such payments could have been made, one in 2018 and one in 2019. As respondents were appointed co-executors and co-trustees in May 2018, more than seven months have passed since letters were issued (see EPTL 11-1.5 [a], [c]; SCPA 1802 ).
Accordingly, the burden shifts to respondents to raise a triable issue of fact as to petitioner's entitlement to these distributions. In opposition, respondents allege that petitioner owes money to the estate and has wrongfully withheld estate property. They also argue that petitioner's motion should be denied because they commenced a proceeding against him to recover such property in early 2018 and that proceeding remains pending before this Court. They also note that petitioner has not complied with their outstanding discovery requests in that proceeding, causing petitioners to twice move to compel compliance with discovery demands.
The second of these motions is currently pending before the Court.
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With respect to the property petitioner owes to the estate, respondents allege that, in 2016, petitioner withdrew $20,000 from decedent's Capital Bank checking account and deposited it into his own account at Capital Bank. They further allege that, in 2017, a few months before decedent's death, petitioner liquidated an account at Charles Schwab which he held jointly with her in the amount of $36,287.51. They allege that, as a joint tenant, petitioner was entitled to withdraw only half of the account at that time (which would equal $18,143.75). Respondents also allege that petitioner stole property from decedent's safety deposit box which, at one point, may have contained $55,000 in cash. In addition, respondents note that petitioner has asserted a claim to cash and coins contained in a safe in decedent's condo; however, respondents question the legitimacy of petitioner's ownership of such property. They further allege that petitioner has kept decedent's vehicle, in which he owned a half interest, thus depriving the estate of approximately $4,900. Respondents have provided documentary evidence in support of these allegations. Viewing this evidence in the light most favorable to respondents, as the nonmoving parties (see Vega v. Restani Constr. Corp. , 18 N.Y.3d 499, 503, 942 N.Y.S.2d 13, 965 N.E.2d 240 [2012] ), the Court finds that this evidence is sufficient to raise a question of fact regarding whether petitioner owes a debt to the estate and whether that amount is more than the value of distributions he is requesting at this time (compare Matter of Alpert , 129 A.D.2d 444, 445, 514 N.Y.S.2d 16 [1st Dept. 1987], lv denied 70 N.Y.2d 603, 518 N.Y.S.2d 1026, 512 N.E.2d 552 [1987] ; Matter of Marsh , 2006 N.Y. Slip Op. 52077[U] at *3-4 ). Accordingly, petitioner's motion for summary judgment with respect to the $50,000 distributions directed in decedent's will is denied without prejudice to renewal after January 2020, at which time the amount owed to petitioner may be greater than the amount alleged to be owed by him to the estate.
Petitioner also seeks to compel payment by respondents of $1,500 as reimbursement for his expenses when he visited decedent as set forth in an order issued in the guardianship proceeding for decedent pursuant to Mental Hygiene Law article 81. As is relevant here, the guardianship order provided that petitioner "shall be reimbursed for in-person visits up to the amount of $500 per month once he provides documentation showing costs incurred of said amount Notice of said visit will be given according to a stipulation executed by the parties." Petitioner has provided documentation of his visits and the related expenses to respondents. Accordingly, the Court finds that petitioner has established prima facie entitlement to judgment on this issue.
In opposition, respondents state that they have not reimbursed petitioner for the expenses because, as they argued above, petitioner owes money to the estate, and also because petitioner failed to provide advance notice of his visits which they contend was a prerequisite to receiving reimbursement for the visits. With respect to the guardianship order, the plain language of the order does not condition repayment on notice having been provided. The only condition on reimbursement contained in the order is that petitioner provide documentation, which he has done and with which respondents have not taken issue. As for the allegations that petitioner owes a debt to the estate, as stated above, respondents have raised a question of fact as to whether petitioner owes money to the estate which would exceed the amount of the payment he is seeking at this time. Accordingly, petitioner's motion for summary judgment is denied without prejudice to renewal after January 2020. This constitutes the decision and order of the court. It is hereby
ORDERED that petitioner's motion for summary judgment is denied without prejudice to renewal after January 2020.