Morris v. Zimmer

211 N.Y.S.3d 414

227 A.D.3d 696

Daniel MORRIS, et al., appellants,

v.David ZIMMER, respondent.

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

Argued—November 20, 2023

May 1, 2024

Daniel Morris, White Plains, NY, appellant pro se and for appellant Lucille Morris.

MARK C. DILLON, J.P., CHERYL E. CHAMBERS, LARA J. GENOVESI, LOURDES M. VENTURA, JJ.

DECISION & ORDER

In a consolidated action, inter alia, to recover damages for breach of contract, the plaintiffs appeal from (1) an order of the Supreme Court, Westchester County (Charles D. Wood, J.), dated June 21, 2019, and (2) an order of the same court dated December 12, 2019. The order dated June 21, 2019, among other things, denied the plaintiffs’ motion for leave to enter a default judgment against the defendant, granted the defendant’s motion pursuant to CPLR 3211(a) to dismiss the complaint, and, in the alternative, in effect, sua sponte, directed dismissal of the complaint. The order dated December 12, 2019, inter alia, denied the plaintiffs’ motion for leave to renew and reargue, among other things, their motion for leave to enter a default judgment against the defendant and their opposition to the defendant’s motion pursuant to CPLR 3211(a) to dismiss the complaint.

ORDERED that on the Court’s own motion, the notice of appeal from so much of the order dated June 21, 2019, as, in effect, sua sponte, directed dismissal of the complaint is deemed to be an application for leave to appeal from that portion of the order, and leave to appeal is granted (see CPLR 5701[c]); and it is further,

ORDERED that the order dated June 21, 2019, is modified, on the law, by deleting the provision thereof granting the defendant’s motion pursuant to CPLR 3211(a) to dismiss the complaint, and substituting therefor a provision denying the defendant’s motion; as so modified, the order dated June 21, 2019, is affirmed, without costs or disbursements; and it is further,

ORDERED that the appeal from so much of the order dated December 12, 2019, as denied that branch of the plaintiffs’ motion which was for leave to reargue is dismissed, without costs or disbursements, as no appeal lies from an order denying reargument; and it is further,

ORDERED that the appeal from so much of the order dated December 12, 2019, as denied that branch of the plaintiffs’ motion which was for leave to renew their opposition to the defendant’s motion pursuant to CPLR 3211(a) to dismiss the complaint is dismissed as academic, without costs or disbursements, in light of our determination on the appeal from the order dated June 21, 2019; and it is further,

ORDERED that the order dated December 12, 2019, is affirmed Insofar as reviewed, without costs or disbursements.

In or about 2000, the plaintiff's, Daniel Morris and Lucille Morris, retained the defendant, David Zimmer, an attorney then admitted to practice in Maryland, to represent them in a dispute regarding alleged unauthorized trading in their brokerage accounts. In 2004, a settlement was reached, and the defendant, as the plaintiffs’ attorney, received the settlement funds on their behalf, However, he failed to deliver those funds to the plaintiffs, in addition to other funds owed to them. In 2007, Daniel Morris filed a grievance complaint against the defendant with the Attorney Grievance Commission of Maryland. By order of the Court of Appeals of Maryland dated May 5, 2009, the defendant was disbarred by consent (see Attorney Grievance Commn. of Maryland v. Zimmer, 408 Md. 486, 970 A.2d 891). The plaintiffs also alerted various law enforcement authorities of the defendant’s conduct. In 2009, the New York County District Attorney’s Office commenced a criminal action against the defendant, charging him with grand larceny in the second degree in violation of Penal Law § 155.40(1). In May 2010, pursuant to the terms of a plea agreement, the defendant pleaded guilty to petit larceny in violation of Penal Law § 155.25 and was afforded the opportunity to replead to a lesser charge upon payment to the plaintiffs of the full amount owed. Although the defendant subsequently made a partial payment, he failed to pay the full amount owed and instead executed an affidavit of confession of judgment in the plaintiffs’ favor in the amount of $77,625.

In May 2010, days after the defendant pleaded guilty in the criminal action, the plaintiffs commenced an action against him, among others, in the United States District Court for the Southern District of New York (hereinafter the federal action). In the second amended complaint, the plaintiffs asserted causes of action alleging breach of contract, breach of fiduciary duty, fraud, conversion, and fraudulent misappropriation of funds stemming from the defendant’s failure to pay the plaintiffs the amount owed (see Morris v. Zimmer, 2011 WL 5533339, *1, *6–8, 2011 U.S. Dist. LEXIS 130919, *1, *15-20 [S.D.N.Y., No. 10 Civ. 4146(VB)]). The plaintiffs subsequently sought leave to amend the second amended complaint, inter alia, to add a cause of action pursuant to Judiciary Law § 487, but the District Court denied their request. The plaintiffs then moved for summary judgment on the second amended complaint insofar as asserted against the defendant. By memorandum decision dated March 21, 2014, the District Court, among other things, adopted a magistrate judge’s report and recommendation in its entirety and granted that branch of the plaintiffs’ motion which was for summary judgment on the issue of liability against the defendant, while also making certain determinations with regard to damages (see Morris v. Zimmer, 2014 WL 13115252, *2, 2014 U.S. Dist. LEXIS 38640, *2–5 [S.D.N.Y., No. 10 Civ. 4146(VB)]), affd 637 Fed.Appx. 654 [2d Cir.]; see also Morris v. Zimmer, 2014 WL 7474770, *5-6, 2014 U.S. Dist. LEXIS 39608, *14-19 [S.D.N.Y., No. 10 Civ. 4146(VB)(LMS)]). On June 9, 2014, a judgment was entered, inter alia, in favor of the plaintiffs and against the defendant awarding damages in the principal sum of $92,625. The plaintiffs appealed from the judgment. By summary order dated February 5, 2016, the United States Court of Appeals for the Second Circuit affirmed the judgment (see Morris v. Zimmer, 637 Fed.Appx. 654). On October 3, 2016, the United States Supreme Court denied the plaintiffs’ petition for writ of certiorari (see Morris v. Zimmer, 580 U.S. 873, 137 S.Ct. 203,196 L.Ed.2d 132).

In March 2013, while the federal action was pending, the plaintiffs applied for a judgment by confession pursuant to CPLR 3218 in the Supreme Court, New York County, relying upon, among other things, the defendant’s affidavit of confession of judgment (hereinafter the New York County action). A judgment was thereafter entered in favor of the plaintiffs and against the. defendant in the total sum of $67,85’0, reflecting the $77,625 that the defendant had confessed to owing the plaintiffs in his affidavit, plus $225 in costs and disbursements, with a credit for a $10,000 payment the defendant made after executing the affidavit. In April 2014, shortly after the District Court decided their motion for summary judgment in the federal action, the plaintiffs commenced another action against the defendant, in the Supreme Court, Westchester County (hereinafter the Westchester County action). In the complaint, the plaintiffs asserted the same causes of action that they successfully asserted in the federal action as well as a cause of action pursuant to Judiciary Law § 487, among others. They also set forth information relating to the federal action, including with regard to their motion for summary judgment and the magistrate judge’s report and recommendation relating thereto. The plaintiffs subsequently moved, inter alia, in the Supreme Court, New York County, to consolidate the New York County action, which had already resulted in a judgment, with the Westchester County action. The court, in effect, granted that branch of the plaintiffs’ motion, consolidated the New York County action with the Westchester County action, and transferred the action to the Supreme Court, Westchester County.

In or about April 2016, the plaintiffs moved for leave to enter a default judg- ment against the defendant. In support of their motion, the plaintiff submitted, among other things, a copy of the memorandum decision of the District Court dated March 21, 2014. The defendant thereafter moved pursuant to CPLR 3211(a) to dismiss the complaint, prompting the plaintiffs to file an amended complaint. By order dated June 21, 2019, the Supreme Court, inter alia, denied the plaintiffs’ motion, granted the defendant’s motion, and, in the alternative, in effect, sua sponte, directed dismissal of the complaint. The plaintiffs then moved for leave to renew and reargue, among other things, their motion for leave to enter a default judgment against the defendant and their opposition to the defendant’s motion pursuant to CPLR 3211(a) to dismiss the complaint. By order dated December 12, 2019, the court, inter alia, denied the plaintiffs’ motion. The plaintiffs appeal from both orders.

[1–5] "On a motion for leave to enter a default judgment against a defendant based on the failure to answer or appear, a plaintiff must submit proof of service of the summons and complaint, proof of the facts constituting the cause of action, and proof of the defendant’s default" (Travelon, Inc. v. Maekitan, 215 A.D.3d 710, 712, 187 N.Y.S.3d 674 [internal quotation marks omitted]). "To demonstrate the facts constituting the cause of action, the plaintiff need only submit sufficient proof to enable a court to determine if the cause of action is viable, since defaulters are deemed to have admitted all factual allegations contained in the complaint and all reasonable inferences that flow from them" (Yan Ping Xu v. Van Zwienen, 212 A.D.3d 872, 873, 183 N.Y.S.3d 475 [internal quotation marks omitted]). However, "[a] court does not have a mandatory, ministerial duty to grant a motion for leave to...