Stuart v. Stuart

MICHAEL J. STUART, Plaintiff, v. CLARENCE L. STUART, JR., a/k/a "BUTCH," and SHIRLEY A. FELDER, Defendants.

No. 12-CV-5588 (CS)

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

Dated: December 10, 2013

OPINION AND ORDER

Appearances:

Michael J. Stuart

Weston, Connecticut

Pro Se Plaintiff

Robert Fischl

Law Offices of Robert K. Fischl

East Meadow, New York

Counsel for Defendants

Seibel, J.

Before the Court are the Motions to Dismiss, (Docs. 32, 33), and Motions for Judgment on the Pleadings, (Docs. 26, 29), of Defendants Clarence L. Stuart, Jr. and Shirley A. Felder.¹ For the following reasons, Defendants' Motions are GRANTED.

I. Background

For the purposes of Defendants' Motions, I accept as true the facts, but not the conclusions, as set forth in Plaintiff's Third Amended Complaint ("TAC"), (Doc. 22 Ex. A).

Plaintiff Michael J. Stuart, proceeding pro se, brings this action against his older brother, Clarence L. Stuart, Jr. ("Clarence"), and his brother's girlfriend, Shirley A. Felder, alleging thatClarence defrauded him and his siblings out of the profits from the Stuart family home. Plaintiff claims that Clarence leveraged the value of the home to acquire other properties for his and Ms. Felder's personal gain instead of treating the property as part of their mother's estate. Plaintiff asserts claims for breach of fiduciary duty, conversion, fraud, intentional infliction of emotional distress and an accounting.

On July 24, 1978, Lucille Benjamin Stuart, the mother of Plaintiff, Clarence, and their three siblings - Ronald, Sandra and Margaret - executed a will, which provided that upon her death her property and assets would be distributed one-third to her husband, Clarence Stuart, Sr., and the remainder equally to her five children. (TAC ¶¶ 2, 7; see Doc. 2 Ex. 2.) Ms. Stuart appointed Plaintiff, Clarence and Margaret as co-executors of her will. (TAC ¶ 3.) Clarence retained the original will, while Plaintiff and Margaret each received copies. (Id. ¶ 6.)

When Ms. Stuart executed her will, she and her husband owned the property at issue: a two-family home located at 109-49 215th Street in Queens, New York. (See id. ¶ 1; Doc. 2 Ex. 1.) By 1989, her husband had passed away, and she, now destitute and infirm, required full-time medical care. (TAC ¶ 7.) Clarence allegedly suggested that she transfer her home to Ronald, who was living with her at the time, and that this transfer would be valid under the Medicaid transfer law.² (P's Opp. 3.)³ According to Clarence, this transfer would qualify Ms. Stuart for Medicaid and preserve the home as an inheritance that would be transferred back to her estate upon her death. (TAC ¶ 8; P's Opp. 3.) Plaintiff further alleges that Clarence persuaded their mother to appoint him as co-transferee because Ronald was incompetent to manage the home.(P's Opp. 3.) Clarence allegedly promised to oversee the sale of the home or the equal distribution of profits if the property were retained as a rental. (Id. at 3-4.) On May 24, 1989, Ms. Stuart transferred the property to Ronald and Clarence as joint tenants with rights of survivorship.⁴ (TAC ¶ 7; see Doc. 2 Ex. 7.)

Ms. Stuart passed away on July 21, 1997, and Clarence served as executor of her estate. (TAC ¶ 9.) Six months later, on January 16, 1998, Clarence allegedly "secretly induced" Ronald to transfer his interest in the property to him.⁵ (Id. ¶ 10.) Clarence paid Ronald $3,000, Ronald moved out of the home, and Clarence began renting out the property. (Id.) Clarence recorded the transfer on March 23, 1998, (id. ¶ 11), and informed his siblings, including Plaintiff, of the transfer at a family meeting on or about April 1, 1998, (id. ¶ 12). Plaintiff alleges that Clarence "promised to administer the two-family home as an income-producing property and distribute proceeds and profits accordingly to each of the sibling-beneficiaries." (Id.) The siblings agreed with Clarence's plan and decided to wait to receive their share of the profits. (Id.)

Fourteen years later, Clarence still had not distributed any profits to his siblings. Plaintiff alleges that Clarence engaged in a series of real estate transactions involving the Stuart family home, but kept the profits for himself. On April 8, 1998, Clarence mortgaged the home and used the proceeds to purchase another property in Jamaica, New York. (Id. ¶¶ 13-14.) These transactions continued for well over a decade with first Clarence, and then Clarence and Ms.Felder, mortgaging the properties they held in order to purchase additional properties and invest in other businesses. (See id. ¶¶ 15-62.) At no point did the siblings receive any money from these investments.

Plaintiff contends that Clarence "knowingly made misrepresentations to [him] and [the other] sibling-beneficiaries . . . to lull [them] not to make further inquiries" and "to hide his fraudulent conduct." (Id. ¶ 12.) These statements included: (1) at a 1998 Christmas meeting, Clarence said "nothing unusual" had occurred with the property and that he was continuing to make repairs, (id. ¶ 17); (2) at a Labor Day barbecue in 2000, Clarence said "things were moving very slowly" and he was unsure when the property would begin to turn a profit, (id. ¶ 20); (3) at a 2001 Christmas meeting, Clarence denied that there was any money available for distribution and alleged that he "was broke" due to upkeep expenses, (id. ¶ 24); (4) around July 4, 2001, Clarence denied having any profits and restated his inability to distribute money to his family, (id. ¶ 26); (5) at Thanksgiving 2001, Clarence said there was "no activity" going on with the house and he was just "breaking even," (id. ¶ 29); (6) in July 2002, Clarence denied having any money to distribute (id. ¶ 35); (7) in June 2003, Clarence again denied having any money to distribute, (id. ¶ 38); (8) in July 2003, Clarence again denied having any money to distribute and alleged that he was "broke," (id.); (9) around July 29, 2007, Clarence denied having any funds to distribute, (id. ¶ 59); and (10) throughout 2010, Clarence denied that any funds were available, (id. ¶ 61).⁶

Plaintiff filed his pro se Complaint on July 18, 2012, (Doc. 2), and filed his Amended Complaint on October 12, 2012, (Doc. 6). The parties appeared before me for an initialconference on February 21, 2013. Defendants indicated their intention to move to dismiss the Amended Complaint on the ground that the statute of limitations for Plaintiff's claims had expired. I granted Plaintiff leave to amend to explain why his claims were not time-barred. Plaintiff thereafter filed a Second Amended Complaint, (Doc. 21), and ten days later, a Third Amended Complaint, (Doc. 22).

II. Discussion

A. Legal Standard

Defendants move to dismiss pursuant to Rule 12(c) of the Federal Rules of Civil Procedure.⁷ The standard of review for a motion for judgment on the pleadings pursuant to Rule 12(c) is the same as that for a Rule 12(b)(6) motion to dismiss. See Patel v. Contemporary Classics of Beverly Hills, 259 F.3d 123, 126 (2d Cir. 2001).

"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. "While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly, 550 U.S. at 555 (alteration, citations, and internal quotation marks omitted). While Federal Rule of Civil Procedure 8 "marks a notable and generous departurefrom the hyper-technical, code-pleading regime of a prior era, . . . it does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions." Iqbal, 556 U.S. at 678-79.

In considering whether a complaint states a claim upon which relief can be granted, the court "begin[s] by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth," and then determines whether the remaining well-pleaded factual allegations, accepted as true, "plausibly give rise to an entitlement to relief." Id. at 679. Deciding whether a complaint states a plausible claim for relief is "a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. "[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged - but it has not 'shown' - 'that the pleader is entitled to relief.'" Id. (alteration omitted) (quoting Fed. R. Civ. P. 8(a)(2)).

Pro se complaints are held to less stringent standards than those drafted by lawyers, even following Twombly and Iqbal. See Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per curiam); Harris v. Mills, 572 F.3d 66, 72 (2d Cir. 2009). But while pleadings of a pro se party should be read "to raise the strongest arguments that they suggest," Kevilly v. New York, 410 F. App'x 371, 374 (2d Cir. 2010) (summary order) (internal quotation marks omitted), dismissal of a pro se complaint is nevertheless appropriate where a plaintiff has clearly failed to meet minimum pleading requirements, see Rodriguez v. Weprin, 116 F.3d 62, 65 (2d Cir. 1997); accord Honig v. Bloomberg, No. 08-CV-541, 2008 WL 8181103, at *4 (S.D.N.Y. Dec. 8, 2008), aff'd, 334 F. App'x 452 (2d Cir. 2009) (summary order).⁸

B. Motion to Dismiss

Plaintiff alleges that Defendants defrauded him and his siblings out of the profits from the family home, and from all financial transactions deriving from the property. He brings...