| General Elec. Capital Corp. v Highgate Manor Group, LLC |
| 2010 NY Slip Op 00030 [69 AD3d 992] |
| January 7, 2010 |
| Appellate Division, Third Department |
| General Electric Capital Corporation,Respondent, v Highgate Manor Group, LLC, et al., Appellants, et al.,Defendants. |
—[*1] Moritt, Hock, Hamroff & Horowitz, L.L.P., Garden City (William P. Laino of counsel), forrespondent.
Rose, J. Appeal from an order of the Supreme Court (Hummel, J.), entered January 7, 2008in Rensselaer County, which granted plaintiff's motion for summary judgment.
After defaulting on loans that were secured by a mortgage upon four properties where theyoperated nursing homes, defendant Highgate Manor Group, LLC and two of its affiliates(hereinafter collectively referred to as Highgate) entered into a forbearance agreement withplaintiff that acknowledged past defaults and provided that Highgate and certain individualswould act as guarantors of past and future indebtedness. Those guarantors included defendantsDianna R. Koehler-Nachamkin and Eugene M. Nachamkin (hereinafter collectively referred toas defendants). When Highgate defaulted on the forbearance agreement, plaintiff commencedthis action to foreclose the mortgage and a receiver was appointed to operate the premises.Plaintiff later moved for summary judgment foreclosing the mortgage and holding all defendantsliable for any deficiency following sale of the premises. Supreme Court granted plaintiff'smotion, [*2]prompting this appeal.[FN*]
Initially, defendants argue that they raised questions of fact as to whether plaintiff had been amortgagee in possession and caused significant loss to the value of the mortgaged premises. Therecord, however, does not support this contention. While the mortgage did provide that plaintiffhad the right to possess the premises, there is no evidence that plaintiff took possession andoperated the premises such that it "may be charged with rents and profits [it] might havereceived, if [its] failure to recover them is attributable to [its] fraud or willful default"(Hubbell v Moulson, 53 NY 225, 229 [1873]; see Gasco Corp. & Gordian Group ofHong Kong v Tosco Props., 236 AD2d 510, 512 [1997]). Nor did plaintiff effectively takepossession through the acts of the receiver. It is well settled that "a court-appointed receiver in aforeclosure action is an officer of the court and not an agent of the party who procured theappointment" and "[d]uring the pendency of the receivership, the property is, in essence, in thepossession of the court itself" (Trustco Bank, Natl. Assn. v Eakin, 256 AD2d 778, 779[1998]). Defendants' only submission in opposition to plaintiff's motion was an affidavit fromNachamkin which did not contain any claim that plaintiff was acting as a mortgagee inpossession. Nor is there any evidence that the receiver was plaintiff's agent or that plaintiffotherwise entered into possession of the mortgaged premises, collected rents or incurred anyindebtedness. In short, the facts alleged, if proven, would not establish that plaintiff was amortgagee in possession (compare Aetna Life Ins. Co. v Avalon Orchards, 118 AD2d297, 300 [1986], appeal dismissed 68 NY2d 997 [1986]). Accordingly, Supreme Courtdid not err in finding that defendants failed to raise a material question of fact in opposition toplaintiff's motion for summary judgment.
Defendants' remaining arguments, raised for the first time on appeal, are that Supreme Courtimproperly granted plaintiff's motion without first permitting them to conduct further discoveryregarding the interrelationship between plaintiff and the receiver (see CPLR 3212 [f]),and that they should be allowed to implead the receiver for mismanagement of the mortgagedpremises. Defendants' failure to request leave to conduct discovery and implead the receiverfrom Supreme Court renders those issues unpreserved for appellate review (see Herron v Essex Ins. Co., 34 AD3d913, 914 [2006], lv dismissed 8 NY3d 856 [2007]; Murphy v Arrington, 295AD2d 865, 866 [2002]).
Mercure, J.P., Lahtinen, Malone Jr. and Garry, JJ., concur. Ordered that the order isaffirmed, with costs.
Footnote *: Although defendants andHighgate appealed from Supreme Court's order, only defendants have submitted an appellatebrief. Due to its failure to file a brief, Highgate is deemed to have abandoned its appeal (seeBergmann v State of New York, 281 AD2d 731, 732 n [2001]; Carpinone v Mutual ofOmaha Ins. Co., 265 AD2d 752, 754 [1999]).