Opinion
8474/11
03-29-2012
Thomas Leonardi, Plaintiff, v. Charlene Leonardi and John Doe, as Executor of the Estate of Anthony Leonardi, Defendant.
Plaintiffs Attorney: Joseph S. Hubicki Menagh & Associates/PLLC Defendants Attorney: Bruce S. Reznick, PC Jaffe & Asher, LLP
Plaintiffs Attorney:
Joseph S. Hubicki
Menagh & Associates/PLLC
Defendants Attorney:
Bruce S. Reznick, PC
Jaffe & Asher, LLP
, J.
Defendant, Charlene Leonardi, moves, inter alia, for an order: (1) granting summary judgment and dismissing the complaint; (2) granting summary judgment on her counterclaim. Plaintiff, Thomas Leonardi , cross moves for an order, pursuant to CPLR§ 3212, granting him summary judgment and imposing a constructive trust on the property .
Hereafter, the plaintiff and the defendant are referred by their first names to diminish confusion, which might be expected if their last name was used.
Facts and Procedural Background
On October 12, 1963, Kathlyn Leonardi and Anthony Leonardi were married. They had two children, plaintiff Thomas and his brother, Patrick. On August 12, 1976, Kathlyn and Anthony entered into a separation agreement. By deed dated February 3, 1983, Anthony, Frances Tortorello and Angela Artale each acquired a one-third interest in the property. The separation agreement was modified by stipulation dated August 31, 1983, which provided, in pertinent part, that Anthony "acknowledges that he will prepare a will in which he will leave his one-third interest in the premises at 1658 64th Street to his children". By judgment dated October 26, 1983, Kathlyn and Anthony were divorced. The separation agreement and stipulation were incorporated, but not merged, into the judgment. In September 21, 2000, Ms. Tortorella transferred her one-third interest in the property to Anthony. On September 20, 2006, Anthony encumbered his two-thirds interest in the property with a mortgage in the amount of $420,000; that mortgage is now in foreclosure. On January 29, 2007, Ms. Artale transferred her one-third interest to Mr. Artale. On June 24, 2010, Anthony transferred his two-thirds interest to himself and Charlene. Anthony died on February 6, 2011.
On December 20, 2007, Kathlyn, Thomas and Patrick commenced an action against Anthony seeking specific performance of that provision of the stipulation which required Anthony to prepare a will leaving his one-third interest in the property to his children and they sought a judgment declaring that the stipulation and judgment of divorce required Anthony to execute and leave in force a will having such provision and precluding Anthony from transferring, selling or encumbering the property (Kings County Sup Ct, Index number 46256/07, (the 2007 Action)). By order dated May 27, 2009, Anthony's motion to dismiss that complaint and to vacate the lis pendens filed in the action was denied by the Honorable David B. Vaughan (the 2009 Decision). The lis pendens thereafter expired and the action was discontinued as to Kathlyn and Patrick.
On April 13, 2011, Thomas commenced the instant action against Charlene and John Doe, as Executor of the Estate of Anthony Leonardi, seeking to impose a constructive trust on the property and for damages predicated upon claims of unjust enrichment and breach of the separation agreement. Charlene interposed a counterclaim in which she seeks to recover damages incurred by the alleged willful, wanton and reckless filing of the two actions and the lis pendenses, which allegedly resulted in Anthony's inability to sell the property, which in turn caused interest and late charges to accrue on the mortgage. In support of her motion, Charlene argues that Anthony was in full compliance with the terms of the stipulation and the judgment of divorce regarding the property when he executed a will. She contends that there is no basis for the continuation of this action. She argues that because the lis pendens in the 2007 Action expired and Patrick discontinued that action, Thomas should not be permitted to re-file it in the instant action. Moreover, there is no merit to the instant action and no estate will be established for Anthony. Charlene also alleges that she is entitled to summary judgment on her counterclaim because the property is in foreclosure as a result of the pendency of the 2007 Action and the instant action, both of which she contends are frivolous.
In opposition to Charlene's motion and in support of his cross motion, Thomas argues that because Anthony transferred his interest in the property to himself and Charlene prior to his death, the property never became part of Anthony's estate and instead, Charlene acquired title by right of survivorship. As a result, Charlene was unjustly enriched. Thomas concludes that a constructive trust should be imposed on that portion of the property that was designated to be his inheritance. In reply, Charlene argues that in reliance upon Brown v Brown (12 AD3d 176 [1st Dept, 2004]), Justice Vaughan held in the 2009 Decision that an agreement to make a will in favor of a child is not enforceable, even if it is based upon a separation agreement executed during the life of a promisor. She avers that when the lis pendens in the 2007 Action expired, Anthony could transfer his entire interest in the property to himself and her, as tenants by the entirety. Thus, when Anthony died, she became the sole owner of the property.
In addition, Charlene alleges that there is no privity between her and Thomas; Thomas did not make timely service of the lis pendens, summons or complaint; and Thomas cannot satisfy the elements necessary to demonstrate entitlement to the imposition of a constructive trust. She re-emphasizes that the stipulation only required Anthony to make a will, which he did, and that there is no requirement in the stipulation that the will be irrevocable. She contends that the stipulation never intended for the issue of her husband's first marriage to have a right of ownership in the property because if the parties had so intended, the property would have been deeded to the children. Finally, Charlene alleges that Thomas cannot succeed in this action, since he must first make out a case against Anthony in the 2007 Action and he did not serve Anthony's estate in this action.
Discussion
It is well established that summary judgment may be granted only when it is clear that no triable issues of fact exist (Alvarez v Prospect Hosp., 68 NY2d 320 [1986]). The party moving for summary judgment "bears the initial burden of making a prima facie showing of its entitlement to judgment as a matter of law" (Holtz v Niagara Mohawk Power, 147 AD2d 857, 858 [1989]). Failure to make such a showing requires denial of the motion, regardless of the sufficiency of the opposing papers (see e.g. Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]; Dat v City of New York, 271 AD2d 635, 635 [2000]). Once such a showing has been established, "the burden shifts to the party opposing the motion for summary judgment to produce evidentiary proof in admissible form sufficient to establish the existence of material issues of fact which require a trial of the action" (Alvarez, 68 NY2d at 324, citing Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). The non-movant is entitled to the benefit of every favorable inference (see Negri v Stop & Shop, 65 NY2d 625 [1985]; Louniakov v M.R.O.D. Realty, 282 AD2d 657 [2001]). Further, "the motion should not be granted where the facts are in dispute, where conflicting inferences may be drawn from the evidence, or where there are issues of credibility" (Scott v Long Is. Power Auth., 294 AD2d 348, 348 [2002], citing Dolitsky v Bay Isle Oil Co., 111 AD2d 366 [1985]). On such a motion, the court is not to determine credibility, but whether a factual issue exists (Capelin Assoc. v Globe Mfg., 34 NY2d 338 [1973]).
As is also relevant to a determination of the issues now before the court, it must be recognized that in interpreting the above quoted provision of the stipulation, it is well settled that "[a] separation agreement is a contract subject to the principles of contract construction and interpretation and where the contract is clear and unambiguous on its face, the courts must determine the intent of the parties from within the four corners of the instrument" (Meccico v Meccico, 76 NY2d 822, 823-824 [1990], rearg denied 76 NY2d [1990], citing Rainbow v Swisher, 72 NY2d 106, 109 [1988]; Nichols v Nichols, 306 NY 490, 496 [1954], reh denied 307 NY 677 [1954]; accord Micciche v Micciche, 62 AD3d 673, 673-674 [2009]). " [W]hen interpreting a contract, the court should arrive at a construction which will give fair meaning to all of the language employed by the parties to reach a practical interpretation of the expressions of the parties so that their reasonable expectations will be realized'" (Herzfeld v Herzfeld, 50 AD3d 851, 851 [2008], quoting Fetner v Fetner, 293 AD2d 645, 645-646 [2002] [internal quotation marks and citations omitted]). It is equally well settled that "[a] court should not, under the guise of interpretation, make a new contract for the parties" (Hannigan v Hannigan, 50 AD3d 957, 958 [2008], citing Sklerov v Sklerov, 231 AD2d 622 [1996]; accord Matter of Nelson v Nelson, 48 AD3d 688, 688 [2008]; Attea v Attea, 30 AD3d 971 [2006], affd 7 NY3d 879 [2006]).
It is well established that "[a]n ambiguity exists only where the agreement on its face is reasonably susceptible to more than one interpretation'" (Rosenberger v Rosenberger, 63 AD3d 898, 899 [2009], quoting Chimart Assoc. v Paul, 66 NY2d 570, 573 [1986]; Sorrentino v Pearlstein, 55 AD3d 901 [2008]; Nappy v Nappy, 40 AD3d 825 [2007]; Clark v Clark, 33 AD3d 836 [2006]). In addressing the issue of whether an ambiguity exists, thecourt of Appeals has explained that: "Whether or not a writing is ambiguous is a question of law to be resolved by the courts' (W.W.W. Assoc. v Giancontieri, 77 NY2d 157, 162 [1990]). . . . In deciding whether an agreement is ambiguous, the court "should examine the entire contract and consider the relation of the parties and the circumstances under which it was executed' (Kass v Kass, 91 NY2d 554, 566 [1998], quoting Atwater & Co. v Panama R.R. Co., 246 NY 519, 524 [1927])." (Nappy, 40 AD3d at 826, internal quotations omitted). Further, the court has explained that " [a] contract is unambiguous if the language it uses has a definite and precise meaning, unattended by danger of misconception in the purport of the agreement itself, and concerning which there is no reasonable basis for a difference of opinion'" (Van Kipnis v Van Kipnis, 43 AD3d 71, 77 [2007], affd in part, modified in part by, remitted 11 NY3d 573 [2008], quoting Greenfield v Philles Records, 98 NY2d 562, 569 [2002]).
In applying the above general principles of law to the facts of this case, the court finds that the stipulation clearly obligated Anthony to execute a will leaving his one-third share of the property to Thomas and Patrick, the children of his first marriage. The provision can only be construed as constituting an agreement to transfer title of the property to Kathlyn and Anthony Leonardi's children upon Anthony's death. In so holding, the court rejects Charlene's contention that the stipulation only required that Anthony execute a will containing such a provision, but thereafter allowed him to freely transfer or otherwise encumber the property prior to his death, as such an interpretation would render the language of the stipulation a nullity. In reaching this conclusion, it must also be noted that Kathlyn gave up her interest in the property as consideration in the equitable distribution agreement reached in the divorce action, since she undeniably had an interest in the former marital residence.
The court further finds, that the plaintiff is entitled to the imposition of a constructive trust on a one-sixth interest in the property. (Simonds v Simonds (45 NY2d 233 [1978])), In Simonds, the Court of Appeals held that a provision in the parties' separation agreement requiring the husband to maintain life insurance naming the wife as the beneficiary, even after the policy that was in existence at the time that the agreement was reached was cancelled and the wife was not named as a beneficiary on the substituted policy, entitled the wife to the imposition of a constructive trust, reasoning that "[s]ince the proceeds of the substituted policies have been paid to decedent's second wife, whose interest in the policies is subordinate to [that of the first wife], a constructive trust may be imposed" (Simonds, 45 NY2d at 237). The same reasoning shall be applied herein in granting that branch of the plaintiff's motion seeking to impress a constructive trust on his interest in the property. Inasmuch as Anthony agreed to bequeath a one-third interest in the property to Thomas and Patrick, Thomas is accordingly entitled to a have a constructive trust impressed upon a one-sixth interest.
In so holding, the court also finds, as was the case in Simonds, that the elements of a constructive are satisfied, i.e., a promise; a transfer in reliance on the promise; a fiduciary relation between decedent and his first wife, Kathlyn; and the unjust enrichment of the second wife, Charlene (Simonds at 242, citing Sharp v Kosmalski, 40 NY2d 119 [1976]; accord Rogers v Rogers, 63 NY2d 582, 584 [1984]; see generally In re Estate of Cohen, 83 NY2d 148, 154 [1994], rearg denied 83 NY2d 953 [1994] [imposing a constructive trust to prevent the surviving party from gaining the benefits of the agreement with the first decedent and then breaching that agreement is essentially a particularized application of the more general rule which recognizes unjust enrichment as a necessary element of any cause of action for a constructive trust]). In this regard, it must also be noted that it has been held that a child may be granted standing as a third-party beneficiary to enforce promises made by a parent in a separation agreement (see e.g. Drake v Drake, 89 AD2d 207, 212 [1982]; see generally In re Estate of Orvis, 35 AD2d 538 [1970], affd 28 NY2d 572 [1971]).
The court also notes that Charlene's reliance upon Brown (12 AD3d 176) is unpersuasive, since that case relied upon the premise that an agreement to make a will is generally enforceable only after the death of the promisor (Brown, 12 AD3d at 176, citing Rubin v Irving Trust Co., 305 NY 288, 298 [1953]). While Anthony was still alive when the 2007 Action was commenced and the 2009 Decision was rendered, he had already died when the instant action was started. Further, the plaintiff is not required to join Anthony's estate as a defendant, since there is no dispute that the property did not pass through the estate, but instead passed to Charlene as a result of her right of survivorship because the property was held by her and Anthony as tenants by the entirety (see generally ETPL 6-2.2(b); V.R.W. v Klein, 68 NY2d 560 [1986]; Salatino v Salatino, 64 AD3d 923 [2009], lv denied 13 NY3d 710 [2009]; Lequerique v Lequerique, 60 AD3d 504 [2009]). Similarly, Charlene's contention that dismissal of the instant action is mandated because of the pendency and/or the decisions rendered in the 2007 Action is unpersuasive. CPLR §3211(a)(4) provides, in relevant part, that "[a] party may move for judgment dismissing one or more causes of action asserted against him on the ground that there is another action pending between the same parties for the same cause of action in a court of any state or the United States." Herein, since the instant action was commenced against Charlene, after Anthony died and title to the property was held by her, individually, the parties in the two actions are not the same and decisions rendered in the 2007 Action are not controlling herein. The court finds that Charlene's remaining contentions are without merit.
Having determined that the plaintiff is entitled to have a constructive trust impressed upon his interest in the property, it follows that Charlene's motion for summary judgment on her counterclaim seeking damages premised upon Thomas' commencement of the 2007 Action and the instant action is denied. Thomas's motion is granted to the extent of impressing a constructive trust on a one-sixth interest in the property and dismissing Charlene's counterclaims. The remaining causes of action are severed and shall continue. All other relief requested is denied.
The foregoing constitutes the order and decision of this court.
ENTER,
____________________________ yvonne lewis, JSC