Emigrant Mortg. Co. v. Pub. Adm'r of Kings Cnty.

207 A.D.3d 437

172 N.Y.S.3d 45

EMIGRANT MORTGAGE COMPANY, INC., respondent,

v.PUBLIC ADMINISTRATOR OF KINGS COUNTY, etc., et al., defendants,Robert Forcina, et al., appellants.

2019-03213

Index No. 33667/07

Supreme Court, Appellate Division, Second Department, New York.

Argued—May 23, 2022

July 6, 2022

Chirico Law PLLC, Brooklyn, NY (Vincent Chirico of counsel), for appellants.

Borchert & LaSpina, P.C., Whitestone, NY (Robert W. Frommer of counsel), for respondent.

FRANCESCA E. CONNOLLY, J.P., SHERI S. ROMAN, LINDA CHRISTOPHER, WILLIAM G. FORD, JJ.

DECISION & ORDER

In an action to foreclose a mortgage, the defendants Robert Forcina and Josephine Forcina appeal, and the estate of Elizabeth Licata purportedly appeals, from an order of the Supreme Court, Kings County (Mark I. Partnow, J.), dated January 16, 2019. The order granted the plaintiff's motion for summary judgment on the complaint insofar as asserted against them, to strike their answer, and to appoint a referee to compute the amount due.

Motion by the plaintiff, inter alia, to dismiss the appeal insofar as purportedly taken on behalf of the estate of Elizabeth Licata. By decision and order on motion of this Court dated February 28, 2020, that branch of the motion which is to dismiss the appeal insofar as purportedly taken on behalf of the estate of Elizabeth Licata was held in abeyance and referred to the panel of Justices hearing the appeal for determination upon the argument or submission thereof.

Upon the papers filed in support of the motion and the papers filed in opposition thereto, and upon the argument of the appeal, it is

ORDERED that the branch of the motion which is to dismiss the appeal insofar as purportedly taken on behalf of the estate of Elizabeth Licata is granted; and it is further,

ORDERED that the appeal insofar as purportedly taken on behalf of the estate of Elizabeth Licata is dismissed; and it is further,

ORDERED that the order is affirmed on the appeal by the defendants Robert Forcina and Josephine Forcina; and it is further,

ORDERED that one bill of costs is awarded to the plaintiff payable by the defendants Robert Forcina and Josephine Forcina.

On November 15, 2006, Elizabeth Licata executed a note in favor of the plaintiff, Emigrant Mortgage Company, Inc. (hereinafter Emigrant), in the sum of $630,000. The note was secured by a mortgage (hereinafter the subject mortgage) encumbering certain real property located in Brooklyn, to wit: a property located on 74th Street (hereinafter the 74th Street property), which was previously owned by the defendant Robert Forcina and the defendant Josephine Forcina, Licata's daughter (hereinafter together the Forcinas); and Licata's residence on 65th Street in Brooklyn (hereinafter the 65th Street property). The money loaned was used, in part, to pay off a prior mortgage loan, taken by the Forcinas, which had encumbered the 74th Street property.

In 2007, Emigrant commenced this action to foreclose the subject mortgage against, among others, Licata and the Forcinas. In March 2013, Licata and the Forcinas filed a verified answer. The answer asserted various affirmative defenses, including an affirmative defense of fraud, to wit: that Emigrant, "by its agents, contractors and/or employees" fraudulently misled Licata and the Forcinas by stating that the Emigrant mortgage would not encumber the 65th Street property; that Licata and the Forcinas relied on those statements; that Emigrant "by its agents, servants, contractors and/or employees" concealed, omitted, or misstated the fact that Emigrant "was giving a collateral mortgage to" Licata and the Forcinas; and that Licata and the Forcinas were harmed as a result of their reliance on the statements and conduct of Emigrant. The answer also asserted that Emigrant, "by its agents, servants, contractors and/or employees" knew or should have known that Licata did not understand the documents that she executed in connection with the note and the subject mortgage.

In October 2016, Emigrant moved for summary judgment on the complaint insofar as asserted against Licata and the Forcinas, to strike their answer, and to appoint a referee to compute the amount due. In support of its motion, Emigrant produced a copy of the subject mortgage, the unpaid note, and evidence of a default.

In response to the allegations of fraud made by Licata and the Forcinas, Emigrant's assistant treasurer, in an affidavit, described the 65th Street property as "collateral security" for the loan. She stated that neither Emigrant nor its legal counsel had any communications with Licata or the Forcinas at the closing. She further stated that the mortgage brokers, Danny Siony and Oracle Funding, Inc. (hereinafter Oracle), who allegedly perpetrated the fraud, were not agents or employees of Emigrant.

Emigrant also submitted a transcript of Josephine's deposition testimony. At her deposition, Josephine testified that when the original mortgage on the 74th Street property went into default, she retained Siony, a mortgage broker employed by Oracle. Siony promised to "save" the 74th Street property. After Siony asked whether a family member could purchase the 74th Street property from her, Josephine approached Licata, who agreed to do so. Siony agreed to obtain a mortgage for Licata so she could purchase the 74th Street property, and obtained a mortgage commitment from Emigrant. According to Josephine, Siony demanded a $100,000 fee for his services, and she agreed to the fee. However, Josephine claimed that she insisted that the mortgage not encumber the 65th Street property. Siony swore that the mortgage would only encumber the 74th Street property.

Josephine attended the closing of the loan transaction with Licata, but did not recall if she or Licata signed any documents. She testified that Licata could not speak or read English. She was not sure that the signatures appearing on the note and the subject mortgage belonged to Licata. She did not read the subject mortgage or the note at the closing. She never had a conversation with Emigrant's attorney, Nathan Ehrlich. When asked why she thought that Siony acted as an agent of Emigrant, she replied, "Siony took care of everything. He's the one that got the Emigrant Bank. He did everything."

The Forcinas opposed Emigrant's motion. The Forcinas contended, among other things, that triable issues of fact existed as to whether any fraudulent misrepresentations made by Siony and Oracle could be imputed to Emigrant on the ground that Siony and Oracle were acting as agents of Emigrant. The Forcinas submitted, inter alia, an affidavit from Licata executed in 2010,...