| Ross v Ross Metals Corp. |
| 2011 NY Slip Op 06224 [87 AD3d 573] |
| August 9, 2011 |
| Appellate Division, Second Department |
| Eric Ross, Individually and as Executor of Luisa Ross, Deceased,Appellant, v Ross Metals Corporation, Respondent. Jack Ross et al., NonpartyRespondents. |
—[*1] Rivkin Radler, LLP, Uniondale, N.Y. (Evan H. Krinick, Cheryl F. Korman, Harris J. Zakarin,and Albert W. Petraglia of counsel), for respondent and nonparty respondent Jack Ross.
In an action to recover damages for breach of contract and anticipatory breach of contractwhich was commenced in the Supreme Court, New York County, under index No. 111132/06and transferred to the Surrogate's Court, Kings County, to be joined with a probated proceedingentitled Matter of Ross, pending under file No. 1806/06, the plaintiff appeals from anorder of the Surrogate's Court, Kings County (Lopez Torres, S.), dated December 8, 2009, whichgranted that branch of the motion of Jack Ross which was to dismiss the complaint in its entiretypursuant to CPLR 3211 (a) (1), and denied the plaintiff's cross motion for summary judgment.
Ordered that the order is modified, on the law, (1) by deleting the provision thereof grantingthat branch of the motion of Jack Ross which was to dismiss the complaint in its entiretypursuant to CPLR 3211 (a) (1), and substituting therefor a provision denying that branch of themotion, and (2) by deleting the provision thereof denying those branches of the plaintiff's motionwhich were for summary judgment on the first and third causes of action, and substitutingtherefor a provision granting those branches of the plaintiff's motion; as so modified, the order isaffirmed, with costs to the plaintiff.
The defendant, Ross Metals Corporation (hereinafter Ross Metals), entered into anagreement (hereinafter the agreement) in September 1996 which provided, among other things,that it would pay the sum of $1,800,000 to Miguel Ross and Luisa Ross, representing $900,000to each in exchange for their respective shares of stock in a closely held corporation. Thepayments were to be made in monthly installments over the course of 15 years and, "in the eventof the disability or death of either Miguel Ross or Luisa Ross, their 50% portion of the monthlypayment [was to be] paid to their respective heirs, distributees and/or assigns."
Miguel Ross died in February 1999. In his will, he explicitly disinherited his sons Jack Ross,Jaime Ross, and Josh Ross, but created a credit shelter trust for the benefit of his wife, LuisaRoss, the remainder beneficiary of which was his son Eric Ross, the plaintiff in this case. Theresiduary of the estate was left to Luisa Ross, who died in March 2006.
The plaintiff commenced this matter in the Supreme Court, New York County, in hisindividual capacity and as executor of the estate of his mother, Luisa Ross, to recover damagesfor [*2]breach of contract and anticipatory breach of contract,alleging that Ross Metals failed and refused to make payments (hereinafter the disputed monthlypayments) that were due to him individually as the remainder beneficiary of the trust created byhis father's will and due to the estate of Luisa Ross.
After the action was transferred to the Surrogate's Court, Kings County, and after that courtdirected that Jack Ross, Jaime Ross, and Josh Ross be joined as necessary parties, Jack Rossmoved to dismiss the complaint pursuant to CPLR 3211 (a) (1), in effect, on the ground that thedisputed monthly payments constituted inter vivos gifts under the agreement. He also moved todismiss the first and second causes of action pursuant to CPLR 3211 (a) (3) on the ground thatthe plaintiff did not have standing to recover in his individual capacity. The plaintiff cross-movedfor summary judgment on the complaint. Jack Ross opposed the plaintiff's cross motion.
The Surrogate's Court granted that branch of Jack Ross' motion which was to dismiss thecomplaint pursuant to CPLR 3211 (a) (1), in effect, concluding that the agreementunambiguously demonstrated that Miguel Ross and Luisa Ross intended to donate the disputedpayments to their four sons—Eric Ross, Jack Ross, Jaime Ross, and Josh Ross—asinter vivos gifts. Because it dismissed the complaint pursuant to CPLR 3211 (a) (1), theSurrogate's Court did not rule on that branch of Jack Ross' motion which was to dismiss thecomplaint pursuant to CPLR 3211 (a) (3) insofar as asserted by the plaintiff Eric Ross in hisindividual capacity, and it denied the plaintiff's cross motion for summary judgment. We modify.
"To make a valid inter vivos gift the donor must intend to make an irrevocablepresent transfer of ownership, there must be a delivery of the gift, either by a physical delivery ofthe subject of the gift or a constructive or symbolic delivery, and there must be acceptance by thedonee" (Matter of Partos, 203 AD2d 578, 578 [1994]; see Gruen v Gruen, 68NY2d 48, 53 [1986]; Matter of Szabo, 10 NY2d 94, 98 [1961]; Shybunko v Geodesic Homes, Inc., 65AD3d 581, 583-584 [2009]). "An inter vivos gift requires that the donor intend to make anirrevocable present transfer of ownership; if the intention is to make a testamentary dispositioneffective only after death, the gift is invalid unless made by will" (Gruen v Gruen, 68NY2d at 53). Moreover, "[t]he delivery required must be such as to vest the donee with controland dominion over the property . . . [and] 'intention or mere words cannot supplythe place of an actual surrender of control and authority over the thing intended to be given' "(Matter of Szabo, 10 NY2d at 98, quoting Vincent v Rix, 248 NY 76, 83 [1928])."[T]he proponent of a gift has the burden of proving each of these elements by clear andconvincing evidence" (Gruen v Gruen, 68 NY2d at 53).
The plaintiff established, prima facie, his entitlement to judgment as a matter of law withrespect to the first and third causes of action by submitting a copy of the agreement anddemonstrating that Ross Metals failed to make payments that had come due under its terms (see Express Shipping, Ltd. v Gold, 63AD3d 669, 671 [2009]). In opposition, Jack Ross failed to raise a triable issue of fact as towhether the disputed monthly payments that had come due under the terms of the agreementconstituted inter vivos gifts (see Matterof Kelligrew, 63 AD3d 1064, 1065-1066 [2009]). Jack Ross failed to demonstrate thatMiguel Ross and Luisa Ross intended to make an irrevocable present transfer of ownership of thedisputed monthly payments when they entered into the agreement since, by its terms, theyretained control over the distribution of the disputed monthly payments (see McCarthy vPieret, 281 NY 407, 413 [1939]; Matter of Roth, 283 AD2d 504, 504 [2001];Chase Lincoln First Bank v Watson, 139 AD2d 903 [1988]). Moreover, Jack Ross failedto submit evidence sufficient to raise a triable issue of fact as to whether a valid delivery everoccurred (see Matter of Lefft, 44 NY2d 915, 918 [1978]; Matter of Szabo, 10NY2d at 98-99; Matter of Baum, 66AD3d 412, 414 [2009]; Matter of Clouse, 292 AD2d 675, 677 [2002];Lichtenstein v Eljohnan, Inc., 161 AD2d 397, 398 [1990]; cf. Speelman v Pascal, 10NY2d 313 [1961]). Accordingly, the Surrogate's Court should have granted those branches of theplaintiff's motion which were for summary judgment on the first and third causes of action, andshould have denied those branches of Jack Ross's motion which were to dismiss the first andthird causes of action pursuant to CPLR 3211 (a) (1).
Jack Ross contends, as an alternative ground for affirmance (see Parochial Bus Sys. vBoard of Educ. of City of N.Y., 60 NY2d 539 [1983]) that those branches of his motionwhich were to dismiss the first and second causes of action pursuant to CPLR 3211 (a) (3)insofar as asserted by him in his individual capacity should be granted. However, his contentionsregarding those branches of the motion are without merit (see Garland v Raunheim, 29AD2d 383, 387-388 [1968]).[*3]
However, the Surrogate's Court properly denied thosebranches of the plaintiff's motion which were for summary judgment on the second and fourthcauses of action. Given the absence of an acceleration clause in the agreement, the plaintiff failedto demonstrate, prima facie, that he was entitled, under a theory of anticipatory breach, to thedisputed monthly payments which had not yet accrued (see Runfola v Cavagnaro, 78 AD3d 1035, 1035 [2010]; AcaciaNatl. Life Ins. Co. v Kay Jewelers, 203 AD2d 40, 43-44 [1994]; Indian Riv. Is. Corp. vManufacturers Trust Co., 253 App Div 549, 551 [1938]; cf. Long Is. R.R. Co. vNorthville Indus. Corp., 41 NY2d 455, 467-468 [1977]).
In light of the foregoing, we need not address the plaintiffs' remaining contentions. Dillon,J.P., Florio, Chambers and Miller, JJ., concur.