| Cordova v Cordova |
| 2009 NY Slip Op 05283 [63 AD3d 982] |
| June 23, 2009 |
| Appellate Division, Second Department |
| Berta Cordova, Respondent, v Juan Alfredo Cordova,Appellant. (Action No. 1.) Berta Cordova, Respondent, v Juan Alfredo Cordova et al.,Appellants, et al., Defendants. (Action No. 2.) Juan Cordova, Appellant, v Berta Cordova,Respondent. (Action No. 3.) |
—[*1] Young & Young, LLP, Central Islip, N.Y. (Richard W. Young of counsel), forrespondent.
In three related actions for a divorce and ancillary relief (action No. 1), inter alia, to recoverdamages for fraud (action No. 2), and to vacate or modify so much of a stipulation of settlementbetween the former husband, Juan Alfredo Cordova, and the former wife, Berta Cordova, asrequired the former husband to refinance the marital residence and, upon refinancing, to pay theformer wife the sum of $144,679 as her share of the equity in that property (action No. 3), (1)Juan Alfredo Cordova appeals (a), as limited by his brief, from so much of an order of theSupreme Court, Suffolk County (Sgroi, J.), dated February 21, 2008, as granted that branch ofthe motion of Berta Cordova in action No. 2 which was for leave to enter a default judgmentagainst him upon his failure to answer the complaint in that action, (b), as limited by his brief,from so much of a second order of the same court, also dated February 21, 2008, as granted thatbranch of the motion of Berta Cordova in action No. 3 which was to dismiss that action, and (c)from a judgment of the same court entered March 28, 2008, which, upon an order of the samecourt (Blydenburgh, J.), dated April 24, 2007, inter alia, in effect, granting those branches of themotion of Berta Cordova in action No. 1 which were to hold him in contempt for his willfulfailure to comply with the parties' stipulation of settlement and, in effect, for leave to enterjudgment in the amount of $144,679, is in favor of Berta Cordova and against him in theprincipal sum of $144,679 in action No. 1, (2) Juan Alfredo [*2]Cordova and Deysi Cordova appeal, as limited by their brief, fromso much of an order of the same court (Sgroi, J.), dated May 28, 2008, as denied that branch ofthe cross motion of Juan Alfredo Cordova, Ana Palma, and Deysi Cordova which was to vacatethe defaults of Juan Alfredo Cordova and Deysi Cordova in answering the complaint in actionNo. 2, (3) Ana Palma appeals from a judgment of the same court entered June 23, 2008, which,upon the order dated May 28, 2008, inter alia, granting that branch of the motion of BertaCordova in action No. 2 which was for leave to enter a default judgment against her and denyingthat branch of the cross motion of Juan Alfredo Cordova, Ana Palma, and Deysi Cordova whichwas to vacate her default in answering the complaint in that action, is in favor of Berta Cordovain action No. 2 and against her in the principal sum of $144,679, and (4) Deysi Cordova appealsfrom a judgment of the same court entered July 15, 2008, which, upon the first order datedFebruary 21, 2008, inter alia, granting that branch of the motion of Berta Cordova in action No.2 which was for leave to enter a default judgment against her, and upon so much of the orderdated May 28, 2008, as denied that branch of the cross motion of Juan Alfredo Cordova, AnaPalma, and Deysi Cordova which was to vacate her default in answering the complaint, is infavor of Berta Cordova and against her in the principal sum of $144,679.
Ordered that on the Court's own motion, the notice of appeal of the defendant Juan AlfredoCordova in Action No. 1 from the order dated April 24, 2007, is deemed to be a notice of appealfrom the judgment entered March 28, 2008 (see CPLR 5512 [a]); and it is further,
Ordered that the appeal of the defendant Deysi Cordova in action No. 2 from the order datedMay 28, 2008, is dismissed; and it is further,
Ordered that the order dated May 28, 2008, is affirmed insofar as appealed from by thedefendant Juan Alfredo Cordova in action No. 2; and it is further,
Ordered that the judgments are affirmed; and it is further,
Ordered that the orders dated February 21, 2008, are affirmed insofar as appealed from; andit is further,
Ordered that one bill of costs is awarded to the respondent.
These related appeals all arise out of the 2006 divorce of Juan Alfredo Cordova (hereinafterthe former husband), and Berta Cordova (hereinafter the former wife), and the ownership of theirmarital premises (hereinafter the property), which was purchased in January 1998. A stipulationof settlement dated September 12, 2006 (hereinafter the stipulation), which was incorporated butnot merged into the judgment of divorce entered December 20, 2006, recited that the formerhusband was the titled owner of the property, that the value of the property was $350,000, thatthe balance of the mortgage on it was $60,642, and that, immediately upon execution of thestipulation, the former husband would refinance the property and give the former wife the sum of$144,679, comprising half the equity. The former husband did not refinance the property.Instead, by a quitclaim deed dated February 16, 2007, he and his sisters, Ana Palma (hereinafterAna) and Deysi Cordova (hereinafter Deysi), transferred the property from the former husband,Ana, and Deysi to Ana and Deysi alone. Thereafter, Ana and Deysi took out a mortgage loan inthe sum of $320,000 secured by the property, using the proceeds, in part, to pay off the existingmortgage. The former husband acknowledges that he was never the sole titleholder of theproperty, but that, from the original purchase of it in 1998 until the quitclaim deed was executedin 2007, he and his sisters had each held a one-third interest in it. He also admits that, as he wasonly a one-third owner of the property, he knew at the time he signed the stipulation that hecould not comply with its provisions requiring him to refinance the property and pay the formerwife the sum of $144,679.
Upon the former husband's failure to comply with the stipulation, the former wife moved inthe divorce action, inter alia, to hold the former husband in contempt for his willful failure tocomply with the stipulation. The Supreme Court, apparently unaware that the former husbandhad already transferred his interest in the property to Ana and Deysi, granted that motion in anorder dated April 24, 2007, to the extent that it appointed the former wife as a receiver to sell theproperty [*3]and granted her leave to enter a money judgmentagainst the former husband in the principal sum of $144,679, to be satisfied out of the proceedsof the sale, if not already satisfied. On March 28, 2008, a money judgment in the principal sumof $144,679 was entered upon that order.
Additionally, in July 2007 the former husband commenced an action to vacate or modify thestipulation on the ground of mutual mistake (hereinafter the reformation action). The essence ofthe former husband's claim was that the recital in the stipulation that he was the titled owner ofthe premises was incorrect, as was the assertion that the property had been purchased withmarital funds. The former wife moved, inter alia, to dismiss the reformation action pursuant toCPLR 3211. In opposition, the former husband filed an affidavit in which he made contradictoryassertions, first acknowledging that at the time he signed the stipulation he knew that he wouldbe unable to comply with it because he owned only a one-third interest in the property, and thendenying in general terms that at the time he signed the affidavit he knew he would be unable tofulfill his obligations. In an order dated February 21, 2008, the Supreme Court granted thatbranch of the former wife's motion which was to dismiss the reformation action, on the groundthat the husband was collaterally estopped from contesting the validity of the stipulation by theorder made upon the former wife's contempt motion. The court nevertheless observed that therecital in the stipulation that the former husband was "the titled owner of the premises purchasedduring the marriage with parties [sic] marital funds" was not technically inaccuratebecause it did not state that the former husband was the "sole owner" of the property. The courtdid not address the former husband's contention that the recital in the stipulation regarding thesource of the funds used to purchase the property was inaccurate.
At about the same time that the former husband commenced the reformation action, theformer wife brought an action against, among others, the former husband, Ana, and Deysi, torecover damages for fraud. Neither the former husband, Ana, nor Deysi timely answered thecomplaint, and, in October 2007, the former wife moved, inter alia, for leave to enter a defaultjudgment against them. In January 2008 the former husband opposed the motion for leave toenter a default judgment, asserting, in essence, that his attorney had been out of the country for alengthy period of time and had been unable to answer the complaint on his behalf. In a secondorder dated February 21, 2008, the Supreme Court granted that branch of the former wife'smotion which was for leave to enter a default judgment against the former husband and Deysi asto liability, but denied the motion insofar as it was for leave to enter a default judgment againstAna on the ground that the affidavit of service of the summons and complaint did not establishthat Ana had been properly served. Subsequently, the former wife provided proof that Ana hadindeed been properly served, and the court held that Ana was in default as well. The formerhusband, Deysi, and Ana moved to vacate their defaults, asserting that their attorney's lengthyabsence from the country, as well as the difficulty in communicating with her while she wasabroad, constituted a reasonable excuse for their defaults. They also asserted that they hadmeritorious defenses to the fraud action. Ana also sought a hearing to determine the validity ofservice of process, asserting in conclusory fashion that she had never been served with thesummons and complaint. In an order dated May 28, 2008, the Supreme Court, upon reviewingthe history of the proceedings, found that any alleged law office failure was not inadvertent, butamounted to an intentional default. Moreover, the Supreme Court found, based on the contents oftheir own affidavits, that the former husband, Deysi, and Ana had deliberately and improperlyacted to prevent the former wife from obtaining her share of the equity in the property.Consequently, the Supreme Court denied their motion to vacate their defaults.
Judgments were subsequently entered against Ana, on June 23, 2008, and against Deysi, onJuly 15, 2008. By decision and order on motion dated August 18, 2008, this Court, on its ownmotion, deemed the notice of appeal by Deysi from the second order dated February 21, 2008, tobe a premature notice of appeal from the judgment entered July 15, 2008, and the notice ofappeal by Ana from the order dated May 28, 2008, to be a premature notice of appeal from thejudgment entered June 23, 2008. Deysi's appeal from the intermediate order dated May 28, 2008,must be dismissed because the right of direct appeal therefrom terminated with the entry of thejudgment entered July 15, 2008 (see Matter of Aho, 39 NY2d 241, 248 [1976]).Nevertheless, the issues raised on her appeal from that order are brought up for review and havebeen considered on the appeal from the judgment entered July 15, 2008 (see CPLR 5501[a] [1]).[*4]
Inasmuch as the former husband acknowledged that heknew when he signed the stipulation that material recitals were inaccurate and that he thereforehad no intention of complying with his obligations under it, the Supreme Court properly, ineffect, granted those branches of the former wife's motion which were to hold him in contemptand, in effect, for leave to enter a money judgment against him, and the Supreme Court properlyentered judgment against him in the principal sum of $144,679, the amount he had agreed to payher for her share of the equity in the property (cf. Greenspan v Greenspan, 56 AD3d 524,524-525 [2008]). A hearing was unnecessary since the former husband's own sworn statementsdemonstrated his willful failure to comply with the provision of the stipulation requiring him torefinance the property and pay the former wife her share of the equity in it (see Muller vMuller, 233 AD2d 486, 487 [1996]).
Moreover, the Supreme Court properly dismissed the complaint in the former husband'sreformation action. A stipulation may be vacated on the ground of mutual mistake when "themistake existed at the time the stipulation was entered into and . . . was sosubstantial that the stipulation failed to represent a true meeting of the parties' minds"(Mahon v New York City Health & Hosps. Corp., 303 AD2d 725, 725 [2003]; cf.Burkart v Burkart, 182 AD2d 798, 798-799 [1992]). Here, the husband's own admissionsestablished that he was not mistaken as to the true state of ownership of the property. To thecontrary, when he signed the stipulation, he did so knowing of the discrepancy and intendingmerely to pay the former wife, at most, the amount he believed to be her share of his portion ofthe property, rather than the amount he was expressly agreeing to pay her.
Furthermore, in the fraud action, the Supreme Court providently exercised its discretion indenying that branch of the cross motion of the former husband, Deysi, and Ana which was tovacate their defaults in answering the complaint. To prevail on their motion, they were requiredto demonstrate both a reasonable excuse for their defaults and meritorious defenses (see StarIndus., Inc. v Innovative Beverages, Inc., 55 AD3d 903, 904 [2008]; Velasquez vGallelli, 44 AD3d 934 [2007]; Berardo v Berardo, 205 AD2d 1036 [1994];Putney v Pearlman, 203 AD2d 333 [1994]). The determination of what constitutes areasonable excuse for a default lies within the sound discretion of the court (see Star Indus.,Inc. v Innovative Beverages, Inc., 55 AD3d at 905). Here, given the length of time betweenthe defaults and the motion to vacate, and the implausibility of the excuse, the court properlyconcluded that the excuse provided by the former husband, Deysi, and Ana for their defaults,which was largely in the nature of law office failure, was insufficient (id. at 905; seeHeidari v First Advance Funding Corp., 55 AD3d 669, 670 [2008]; Chiarello vAlessandro, 38 AD3d 823, 824 [2007]). Moreover, Ana's conclusory denial of service wasinsufficient to require a hearing to determine the validity of service of process (see Hamlet onOlde Oyster Bay Homeowners Assn., Inc. v Ellner, 57 AD3d 732, 732-733 [2008];Zapata-DeJesus v Zapata, 50 AD3d 1131 [2008]; Francis v Francis, 48 AD3d512 [2008]).
The appellants' remaining contentions are without merit. Skelos, J.P., Fisher, Leventhal andLott, JJ., concur.