Perez v. Mendicino

207 N.Y.S.3d 546

225 A.D.3d 717

Fedora A. PEREZ, appellant,

v.Michael MENDICINO, et al., respondents, et al., defendants.

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

Submitted—October 27, 2023

March 13, 2024

Paula A. Miller, P.C., Smithtown, NY, for appellant.

Paladino Law Group, P.C., Carle Place, NY (Anthony Iadevaia of counsel), for respondents.

FRANCESCA E. CONNOLLY, J.P., ROBERT J. MILLER, LARA J. GENOVESI, DEBORAH A. DOWLING, JJ.

DECISION & ORDER

In an action, inter alia, to recover damages for breach of fiduciary duty, the plaintiff appeals from (1) an order of the Supreme Court, Suffolk County (David T. Reilly, J.), dated January 6, 2020, and (2) an order of the same court dated February 5, 2020. The order dated January 6, 2020, insofar as appealed from, granted the cross-motion of the defendants Michael Mendicino, Millennium Homes, and Suffolk Real Estate Solutions, Inc., for summary judgment dismissing the complaint insofar as asserted against them. The order dated February 5, 2020, granted those defendants’ motion to cancel a notice of pendency filed by the plaintiff against the subject property.

ORDERED that the order dated January 6, 2020, is reversed insofar as appealed from, on the law, and the cross-motion of the defendants Michael Mendicino, Millennium Homes, and Suffolk Real Estate Solutions, Inc., for summary judgment dismissing the complaint insofar as asserted against them is denied; and it is further,

ORDERED that the order dated February 5, 2020, is reversed, on the law, and the motion of the defendants Michael Men- dicino, Millennium Homes, and Suffolk Real Estate Solutions, Inc., to cancel the notice of pendency filed by the plaintiff against the subject property is denied; and it is farther,

ORDERED that one bill of costs is awarded to the plaintiff.

In April 2017, the plaintiff and the defendant Millennium Homes (hereinafter Millennium), a real estate brokerage firm, entered into an exclusive listing agreement concerning the short sale of the plaintiff’s residence located in Brentwood (hereinafter the property). Although the plaintiff accepted an offer for the purchase of the property, the plaintiff’s lender did not approve the short sale. In August 2018, a foreclosure sale of the property was conducted at which the defendant Suffolk Real Estate Solutions, Inc. (hereinafter Suffolk Real Estate), was the successful bidder. Title was transferred to Suffolk Real Estate by a referee’s deed dated September 14, 2018.

In November 2018, the plaintiff commenced this action against, among others, Millennium, Suffolk Real Estate, and Michael Mendicino, the owner of Millennium and the president of Suffolk Real Estate (hereinafter collectively the Mendicino defendants), inter aha, to recover damages for breach of fiduciary duty. The complaint alleged that Millennium withheld pertinent information from the plaintiff regarding the status of the short sale, and prevented her from engaging another broker to complete the short sale, resulting in a foreclosure auction at which Mendicino’s company improperly competed with the plaintiff to purchase the property.

In February 2019, the plaintiff moved for a preliminary injunction, inter aha, to enjoin her eviction from the property. The Mendicino defendants cross-moved for summary judgment dismissing the complaint insofar as asserted against them. In November 2019, the Mendicino defendants moved to cancel a notice of pendency filed by the plaintiff against the property. In an order dated January 6, 2020, the Supreme Court, among other things, granted the Mendicino defendants’ cross-motion for summary judgment dismissing the complaint insofar as asserted against them. In an order dated February 5, 2020, the court granted the Mendicino defendants’ motion to cancel the notice of pendency. The plaintiff appeals from both orders.

[1, 2] As the plaintiff correctly contends, the Supreme Court improperly awarded the Mendicino defendants summary judgment dismissing the complaint insofar as asserted against them on the ground that the plaintiff sustained no damages as a result of their actions. A court is generally limited to the issues or defenses that are the subject of the motion (see Rosenblatt v. St George Health & Racquetball Assoc., LLC, 119 A.D.3d 45, 52, 54, 984 N.Y.S.2d 401). Here, as the Mendicino defendants did not address the issue of damages in support of their cross-motion for summary judgment dismissing the complaint insofar as asserted against them, they failed to establish as a matter of law that the plaintiff sustained no damages as a result of the conduct alleged in the complaint, and summary judgment should not have been awarded on that ground.

[3, 4] The Mendicino defendants failed to establish their prima facie entitlement to judgment as a matter of law dismissing the causes of action alleging breach of fiduciary duty (see Kalaijian v. Grahel Assoc., LLC, 193 A.D.3d 833, 142 N.Y.S.3d 377). "[I]t is well settled that a real estate broker is a fiduciary with a duty of loyalty and an obligation to act in the best interests of the principal" (Dubbs v. Stribling & Assoc., 96 N.Y.2d 337, 340, 728 N.Y.S.2d 413, 752 N.E.2d 850; see Edwards v. Walsh, 169 A.D.3d 865, 867, 94 N.Y.S.3d 629). Accordingly, "in dealing with the principal, a real estate broker must act honestly and candidly, and the broker must disclose all material information that it may possess or obtain concerning the transactions involved" (Precision Glass Tinting, Inc. v. Long, 293 A.D.2d 594, 595, 740 N.Y.S.2d 138).

[5, 6] Here, the evidence submitted by the Mendicino defendants failed to establish that Millennium provided the necessary documentation to the plaintiff’s lender so that the short sale could proceed, obtained the approval of the plaintiff’s lender for the short sale, kept the plaintiff informed of the status...