Opinion
8233/09
03-31-2014
Joyce Peck, Plaintiff, v. Yvonne Mitchell, Individually and as Trustee of the Living Trust of Gregory Peck, Defendant.
Plaintiff's Attorney: Vernon & Associates, P.C., 90-04 161st Street, suite 301, Jamaica, NY 11432 Defendant's Attorney: Riconda & Garnett, 753 West Merrick Road, Valley Stream NY 11580
Plaintiff's Attorney: Vernon & Associates, P.C., 90-04 161st Street, suite 301, Jamaica, NY 11432
Defendant's Attorney: Riconda & Garnett, 753 West Merrick Road, Valley Stream NY 11580
David I. Schmidt, J.
Upon the foregoing papers, defendant Yvonne Mitchell Peck, sued herein as Yvonne Mitchell, individually and as Trustee of the Living Trust of Gregory Peck, moves for an order, pursuant to CPLR 3212, granting summary judgment dismissing plaintiff's complaint in its entirety, and for summary judgment on the counterclaim for a partition and sale of certain property.
Factual Background
The plaintiff Joyce Peck (plaintiff) commenced this action seeking, among other things, to impose a constructive trust upon her deceased son's one-half interest in residential property known as 737 East 92nd Street, in Brooklyn, New York (the Brooklyn Property). Plaintiff is currently the owner of the other one-half interest and currently resides in the house. In the amended verified complaint, the plaintiff alleges that, in or about 1982, she and her sons, John Peck and Gregory Peck (now deceased) ("the decedent" or "Gregory") entered into an oral agreement in order to assist her in purchasing the Brooklyn Property. Pursuant to the agreement, the Peck sons agreed to help the plaintiff secure a mortgage for the purchase of the premises, which resulted in all three of their names being placed on the title. Plaintiff alleges that both of her sons, including the decedent, promised that they would, at an appropriate time, execute a deed removing their names from the title thereby transferring back their ownership interest to plaintiff without consideration. In reliance on this promise, the plaintiff alleges that she agreed to take title to the premises with both of her sons even though they made no contributions to the down payment or closing costs. In or about 1992, John Peck's name was removed from the deed, leaving title to the property in the names of the plaintiff and Gregory as tenants in common. Plaintiff alleges that Gregory breached the agreement on or about July 29, 2008, when he conveyed a Bargain and Sale Deed of his one-half interest in the Brooklyn Property from himself, as grantor, to defendant Yvonne M. Peck, as Trustee of the Living Trust of Gregory Peck, as grantee (the defendant). Plaintiff alleges that he made this transfer without her knowledge or authorization and, therefore, in violation of the agreement. Plaintiff maintains that Gregory was entrusted by her as the nominal title holder of a one-half interest in the premises, to hold such interest in trust for her benefit, pursuant to said agreement. Plaintiff further maintains that she is the true owner of the Brooklyn Property in that she has continued to pay all carrying charges of the premises, including but not limited to mortgage payments, water and taxes.
Plaintiff's second cause of action for breach of contract alleges that the plaintiff and Gregory entered into a second oral agreement, whereby it was agreed that Gregory would refinance the Brooklyn Property and use the resulting proceeds to purchase other properties for the benefit of the plaintiff and Gregory. Plaintiff alleges that the decedent did refinance the mortgage of the Brooklyn Property on various occasions, and that he used some of the proceeds to purchase two other properties, 8313 McKensie Place, Lithonia in Georgia (the Georgia property) and 2696 NE 35th Street, Ocala in Florida (the Florida property). It is alleged that Gregory breached the agreement when he transferred title of both the Florida and Georgia properties to the defendant as Trustee of the Living Trust of Gregory Peck, without the plaintiff's knowledge or permission. This transfer of the properties is also the basis of the plaintiff's third cause of action for unjust enrichment.
In her answer, the defendant asserted a counterclaim for the partition and division of the Brooklyn Property, or in the alternative for the sale of the property and a division of the net proceeds. Defendant now moves for summary judgment dismissing all three of plaintiff's causes of action, and for judgment in her favor on the counterclaim for a partition and sale of the Brooklyn Property.
Discussion
Summary judgment may be granted only when it is clear that no triable issue of fact exists (see e.g. Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]; Phillips v Joseph Kantor & Co., 31 NY2d 307, 311 [1972]). The court's function on a motion for summary judgment is "issue finding" rather than issue determination (Sillman v Twentieth Century—Fox Film Corp., 3 NY2d 395, 404 [1957]). Consequently, it is incumbent upon the moving party to make a prima facie showing that he or she is entitled to summary judgment as a matter of law (CPLR 3212[b]; Zuckerman v City of New York, 49 NY2d 557, 562 [1980]; Friends of Animals v Associated Fur Mfrs., 46 NY2d 1065, 1067 [1979]; Zarr v Riccio, 180 AD2d 734, 735 [1992]). If there is any doubt as to the existence of a triable issue, the motion must be denied (Hantz v Fishman, 155 AD2d 415, 416 [1989]). Furthermore, the court should view the evidence in the light most favorable to the non-moving party and give the non-moving party the benefit of all reasonable inferences which can be drawn from the evidence (Fundamental Portfolio Advisors, Inc., v Tocqueville Asset Mgt. L.P., 7 NY3d 96, 105—106 [2006]).
Constructive Trust
In support of her motion, the defendant initially contends that the plaintiff has failed to sufficiently allege a constructive trust cause of action. Additionally, the defendant states that she is willing to transfer the one-half interest in the Brooklyn Property to the plaintiff as long as the existing mortgage (which is approximately $100,000) is assumed and paid off by plaintiff. Defendant contends that the agreement was that the decedent agreed to lend his name to the acquisition of the Brooklyn Property, and that there is no indication that he agreed to remain liable to any mortgages associated with the property after the transfer of title. Defendant argues that she should not be obligated to transfer her one-half interest in the Brooklyn Property and still be obligated to pay off the existing mortgage on said property. Defendant contends that this was not part of the agreement/understanding between the plaintiff and the decedent prior to his death. In this regard, defendant contends that the terms of the Living Trust agreement support her position that only the plaintiff should be obligated to pay the existing mortgage. The Living Trust of Gregory Peck, Article Third at (a) states as follows:
"The Trustee shall convey the right, and interest that the Grantor holds in the premises known as and by 737 E 92nd Street, Brooklyn, New York 11236 [the Brooklyn Property]; to the Grantor's mother, JOYCE PECK, subject to the condition that the existing mortgage on the premises be assumed and paid off and satisfied in its entirety by JOYCE PECK" (Yvonne Mitchell Peck Aff, Exhibit H).
Defendant contends that there is nothing to suggest that the decedent agreed to remain liable on any mortgage(s) associated with the Brooklyn Property upon its transfer of title to the plaintiff. Defendant therefore claims that she has no choice but to request the partition of the Brooklyn Property, that same be sold and the mortgage satisfied. Defendant additionally argues that, in any event, the oral agreement between the plaintiff and the decedent is barred by the Statute of Frauds.
In opposition, the plaintiff argues that summary judgment must be denied as there are numerous issues of fact. Plaintiff maintains that there is no dispute that the Brooklyn Property was purchased with the intent that she would pay the mortgage and all carrying costs, and that the decedent would add his name on the property due to his ability to obtain a mortgage. Plaintiff, however, maintains that she only agreed to be liable for the original mortgage obtained to purchase the Brooklyn Property in the amount of $64,000, and for the second mortgage obtained in 1983 for $8,000, which was used to remodel the kitchen. Plaintiff contends that any mortgages obtained subsequent to that were used for the sole benefit of the decedent and, therefore, his estate should be obligated to repay the additional debts encumbered on the property. Plaintiff further contends that the decedent consistently refinanced or used the Brooklyn Property as security for additional debt.
As an initial matter, the court finds that the plaintiff has adequately alleged a constructive trust cause of action. Thus, although the alleged agreement between the plaintiff and the decedent related to an interest in real property and was not in writing, the Statute of Frauds "does not obstruct the recognition of a constructive trust affecting an interest in land where a confidential relation would be abused if there were repudiation, without redress, of a trust orally declared" (Williams v Williams, 4 AD2d 793 [1957]). The four elements of a constructive trust are (1) a confidential or fiduciary relationship; (2) a promise; (3) a transfer in reliance on the promise; and (4) unjust enrichment (see Sharp v Kosmalski, 40 NY2d 119 [1976]; Church of God Pentecostal Fountain of Love, MI v Iglesia De Dios Pentecostal, MI, 27 AD3d 685 [2006]; Nastasi v Nastasi, 26 AD3d 32 [2005]; Thomas v Thomas, 70 AD3d 588 [2010]; citing Sharp Kosmalski, 40 NY2d at 122).
Here, the record establishes that the plaintiff and her son clearly had a close and fiduciary relationship at the time of the alleged agreement. The parental relation of the parties is one of trust and satisfies the requirement for a fiduciary relation (Djamoos v Djamoos, 153 AD2d 871 [1989]; see Stapleton v Olsen, 69 AD2d 857, 858 [1979]; ["a confidential relationship existed between the deceased son and his mother and sister; there was a promise by him and his sister to maintain their mother for the remainder of her life in the home which was purchased by the mother's funds, but held in the names of the two children; there was a transfer of title to the property in reliance thereon; and failure to impress a trust on the property would result in unjust enrichment."]).
Plaintiff has also alleged that the decedent, after using his name to help the plaintiff obtain a mortgage for the Brooklyn Property, made a promise to transfer his ownership interest in the property to her at a later date. In reliance upon that promise, even though the decedent's name appeared on the deed, the plaintiff alleged that she paid all of the mortgage payments as well as all of the carrying costs for the property since its purchase in 1982. Based upon the foregoing, the court finds that the plaintiff has asserted a claim for a constructive trust, in alleging a confidential relationship between the parties, a transfer in reliance upon a promise made, and has sufficiently alleged that the defendant will be unjustly enriched if a constructive trust is not imposed on the defendant's one-half interest in the Brooklyn property (Coco v Coco, 107 AD2d 21, 24 [1985]).
The defendant has failed to establish as a matter of law that plaintiff's constructive trust claim must be dismissed. Defendant argues that there was no transfer. The plaintiff, however, alleges that by putting the decedent's name on the deed, he received an ownership interest in the Brooklyn Property, for which he gave no consideration. Plaintiff also alleges that she relied on her son's promise that he would transfer that ownership interest back to her at a later date especially since she was the one who made all of the mortgage payments and paid carrying costs for the property. Here, defendant's submissions reveal that the following mortgages were taken out against the Brooklyn Property: $64,000 in 1982 to purchase property which was satisfied in 1989, $8,000 in 1983 to renovate kitchen which was satisfied in 1988, $83,300 in 1988 which was satisfied in 1992, $140,000 in 1992, $15,200 in 1994 which was satisfied in 1997, and $147,000 (credit line home equity mortgage) in 1997, of which approximately $100,000 is currently outstanding on the loan. In her affidavit, the plaintiff alleges that she never received any cash or profits from the refinancing of the property and that she consistently made the increased mortgage payments. Based upon the foregoing, the court finds that there is at least a triable issue of fact as to whether the defendant, as trustee of the decedent's living trust, has been unjustly enriched by retaining the one-half ownership interest in the Brooklyn Property and/or whether the plaintiff should be obligated to pay the remaining mortgage debt upon its transfer (see Coco v Coco, 107 AD2d at 25—26).
Furthermore, the court rejects defendant's assertion that the Dead Man's Statute bars the plaintiff's evidence regarding the alleged oral agreement. CPLR 4519 (the Dead Man's Statute) bars testimony from a person interested in the event or a person from, through or under whom such person derives his or her interest or title with regard to any personal transaction or communication with the decedent. Generally, evidence that is inadmissible at trial under CPLR 4519 cannot be used to support a motion for summary judgment. However, "statements of a decedent are not rendered inadmissible under the Deadman's Statute' (see CPLR 4519), when offered in opposition to a motion for summary judgment." (see Lauriello v Gallota, 59 AD3d 497,498 [2009]). Indeed, "hearsay testimony which violates the Dead Man's Statute (CPLR 4519) may be admitted for the purpose of opposing a motion for summary judgement" (see Johnson v Pollack, 261 AD2d 585, 586 [1999];; see also Phillips v Joseph Kantor & Co., 31 NY2d 307, 315 [1972]; Friedman v Sills, 112 AD2d 343, 344 [1984]). Nonetheless, evidence otherwise excludable at trial may not form the sole basis for a court's determination, and standing alone, may be insufficient to defeat a motion for summary judgment (see Philips v Joseph Kantor & Co., 31 NY2d at 314; Marszal v Anderson, 9 AD3d 711 [2004]; Mantella v Mantella, 268 AD2d 852 [2000]; Matter of Barr, 252 AD2d 875 [1998]).
Thus, the primary evidence presented in opposition to defendant's motion (i.e., statements in the plaintiff's affidavit referencing the alleged oral agreement) will be deemed admissible for purposes of defeating the summary judgment motion as long as there is some supportive admissible evidence (see Silvestri v Iannone, 261 AD2d 387 [1999]; Zuilkowski v Sentry Ins., 114 AD2d 453, 454 [1985]; Tancredi v Mannino, 75 AD2d 579, 580 [1990]). As additional evidence, the plaintiff has also proffered the sworn affidavit of her daughter and the decedent's sister, Grace Peck, a disinterested party (Vernon Sur-Reply, Peck Affidavit in Opposition, January 10, 2014). In her affidavit, Grace averred that, prior to the purchase of the Brooklyn Property, she lived in an apartment with her mother and siblings, including the decedent. Grace claimed that she was present when her mother, the decedent and her other brother, John, had a discussion in which her brothers agreed to help the plaintiff secure a mortgage in order to purchase the subject property. She was aware of the agreement that her brothers' names would appear on the deed, and that they both agreed to transfer the title to the plaintiff at a later date. Grace further stated that the plaintiff gave the decedent money for the down payment and that she witnessed many occasions on which the plaintiff handed money to the decedent for the monthly mortgage payments.
The court notes that it will consider the plaintiff's evidence offered for the first time in sur-reply since the defendant has had the opportunity to respond to the newly presented evidence in her "Response to Sur-Reply" (see e.g. Fiore v Oakwood Plaza Shopping Ctr., Inc., 164 AD2d 737, 739 [1991], affd. 78 NY2d 572 [1991]; Hoffman v Kessler, 28 AD3d 718, 719, [2006]; Basile v Grand Union Co., 196 AD2d 836, 837 [1993]). Moreover, under the particular facts on this record, defendant has suffered no prejudice as a result of plaintiff's belated evidentiary submission, and the court will exercise its discretion to consider it.
Based upon the present record, the court finds that various issues of fact preclude that branch of defendant's motion seeking summary judgment dismissing plaintiff's first cause of action for a constructive trust. Consequently, that branch of defendant's motion seeking summary judgment on her counterclaim for a partition and sale of the Brooklyn Property is also denied.
Breach of Contract
Defendant argues that she is entitled to summary judgment dismissing the second breach of contract claim, which pertains to an alleged oral agreement between plaintiff and the decedent (the investment agreement). Pursuant to the investment agreement, it was agreed that the decedent would use proceeds from the refinancing of the Brooklyn Property to purchase other properties for investment purposes, and that the plaintiff and decedent would share in the profits. Plaintiff alleges that the decedent refinanced the Brooklyn Property on several occasions, and that he used part of those proceeds to purchase the Georgia and Florida properties. Plaintiff further alleges that the decedent breached the investment agreement when he transferred title of both properties to defendant, as trustee of his living trust without the plaintiff's knowledge and/or consent.
In moving for summary judgment, the defendant does not dispute the validity and/or existence of the oral investment agreement, but rather contends that summary judgment should be granted dismissing this claim because the evidence establishes that the Florida and Georgia properties were both independently financed by the decedent, and not with proceeds from refinancing the Brooklyn Property. In support of this contention, defendant has submitted documentation from the Automated City Register Information System of the New York City Department of Finance (ACRIS) and Title Search.com records, which establishes, among other things, that the Florida property was purchased by the decedent in 1991, and that he purchased the Georgia property in 2006. As to the Florida property, defendant notes that the records indicate that the closest refinancing of the Brooklyn Property mortgage was in 1988 for $83,000 and in 1992 for $140,000. It is defendant's contention that since refinancing the Brooklyn Property occurred three years before and one year after the decedent purchased the Florida property, it is clear that it was independently financed by the decedent.
Defendant additionally contends that none of the refinancing proceeds from the Brooklyn Property were used to acquire the Georgia property. Specifically, defendant claims that the ACRIS and title search records demonstrate that the Georgia property was purchased by the decedent in 2006, and that the closest refinancing of the Brooklyn Property mortgage was in 1997 for $147,000, which was nine years prior to the purchase. Defendant therefore argues that none of the refinancing proceeds of the Brooklyn Property were directly used to acquire either of the two properties. As such, defendant argues that summary judgment should be granted dismissing plaintiff's breach of contract claim.
It is well established that summary judgment may be granted only when it is clear that no triable issue of fact exists (Alvarez v Prospect Hospital, 68 NY2d 320 [1986]). Furthermore, in deciding the motion, the court must view the evidence in a light most favorable to the party opposing the motion and must give that party the benefit of every favorable inference (Negri v Stop & Shop, 65 NY2d 625, 626 [1985]). Here, on the present record, the court finds that the defendant has failed to make a prima facie showing that none of the proceeds from refinancing the Brooklyn Property were used to acquire either of the properties. Plaintiff claims that the decedent withdrew equity from the Brooklyn Property on various occasions. For instance, records indicate that in 1988 the Brooklyn Property was refinanced with a mortgage amount of $83,300 in 1988, $140,000 in 1992, $15,200 in 1994, and a line of credit home equity mortgage for 147,000 in 1997. Although her name appeared on the mortgage documents with the decedent, plaintiff maintains that she never received any of the funds/proceeds from these refinancing transactions and that she continued to pay the higher monthly mortgage installments which resulted from the refinance. Contrary to defendant's assertion, a time line of when the properties were acquired and the dates of the refinancing mortgages for the Brooklyn Property do not establish as a matter of law that the decedent did not use any of the refinancing proceeds towards the acquisition of the properties at issue. Thus, the court finds that the evidence submitted by defendant is insufficient to establish defendant's entitlement to judgment as a matter of law dismissing plaintiff's breach of contract claim (see Ayotte v Gervasio, 81 NY2d 923 [1993]). Accordingly, that branch of defendant's motion seeking to dismiss plaintiff's breach of contract claim is denied.
Unjust Enrichment
With respect to the unjust enrichment claim, because recovery is dependent upon how the breach of contract claim is resolved, it is likewise not capable of disposition on a summary judgment motion (see McMorrow v Angelopoulos, 113 AD3d 736, 739 [2014]; ["cause of action alleging unjust enrichment is a quasi-contractual claim that is not viable where . . . the parties entered into an express contract governing the subject of dispute"]). In any event, plaintiff has alleged enough facts to raise the inference that the defendant unjustly benefitted at her expense when properties allegedly acquired with refinancing funds from the Brooklyn Property were transferred to her [defendant]; without any consideration (see generally Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). Accordingly, that branch of defendant's motion seeking summary judgment dismissing plaintiff's unjust enrichment claim is also denied.
Conclusion
In sum, defendant's motion is denied in its entirety.
The foregoing constitutes the decision and order of the court.
E N T E R
J. S. C.