| Archer Capital Fund, L.P. v GEL, LLC |
| 2012 NY Slip Op 03388 [95 AD3d 800] |
| May 1, 2012 |
| Appellate Division, Second Department |
| Archer Capital Fund, L.P., Respondent, v Gel, LLC, et al.,Appellants, et al., Defendants. |
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Kaye Scholer, LLP, New York, N.Y. (Richard C. Seltzer and Margaret A. Prystowsky ofcounsel), for respondent.
In an action, inter alia, to foreclose a mortgage, the defendants GEL, LLC, GRL, LLC, EagleRealty, LLC, Emmanuel Lambrakis, George Lambrakis, Gregory Lambrakis, and AlexanderLambrakis appeal, as limited by their brief, from so much of an order of the Supreme Court,Queens County (Agate, J.), entered November 5, 2010, as granted those branches of theplaintiff's motion which were for summary judgment on the complaint, for the appointment of areferee to compute the amount due to the plaintiff, and for leave to seek a deficiency judgment.
Ordered that the order is affirmed insofar as appealed from, with costs.
Archer Capital Fund, L.P. (hereinafter Archer), commenced this action to foreclose amortgage given to it by the defendants GEL, LLC, GRL, LLC, and Eagle Realty, LLC(hereinafter collectively Eagle), and to enforce a guarantee by the defendants EmmanuelLambrakis, George Lambrakis, and Gregory Lambrakis (hereinafter collectively the Lambrakisdefendants). Archer moved for summary judgment on the complaint. The Supreme Court grantedthe motion, relying, in part, on a conditional order of preclusion barring the appellants fromintroducing evidence supporting their defenses and counterclaims.
Archer established its prima facie entitlement to judgment as a matter of law (see Petra CRE CDO 2007-1, Ltd. v 160Jamaica Owners, LLC, 73 AD3d 883, 884 [2010]). With respect to the foreclosure causeof action, Archer submitted the mortgage and the unpaid note and evidence that Eagle defaulted(id.; see Wells Fargo Bank vDas Karla, 71 AD3d 1006 [2010]; Capstone Bus. Credit, LLC v Imperia Family Realty, LLC, 70 AD3d882, 883 [2010]; NeighborhoodHous. Servs. of N.Y. City, Inc. v Meltzer, 67 AD3d 872, 873 [2009]; Quest Commercial, LLC v Rovner, 35AD3d 576 [2006]). With respect to the cause of action for a deficiency judgment based uponthe Lambrakis defendants' guarantee, Archer produced the underlying agreements and evidenceof Eagle's default (see North Fork BankCorp. v Graphic Forms Assoc., Inc., 36 AD3d 676 [2007]; E.D.S. Sec. Sys. vAllyn, 262 AD2d 351 [1999]; Federal [*2]Deposit Ins.Corp. v 7 A.M. to 11 P.M. Delicatessen, 251 AD2d 620 [1998]).
In opposition, the appellants failed to raise a triable issue of fact (see JPMCC 2007-CIBC19 Bronx Apts.,LLC v Fordham Fulton LLC, 84 AD3d 613 [2011]; Petra CRE CDO 2007-1, Ltd. v160 Jamaica Owners, LLC, 73 AD3d at 884; North Fork Bank v Computerized Quality Separation Corp., 62 AD3d973, 974 [2009]; QuestCommercial, LLC v Rovner, 35 AD3d 576 [2006]). The appellants were barred fromsubmitting evidence sufficient to defeat Archer's prima facie showing because the conditionalorder of preclusion became absolute upon the appellants' noncompliance with its terms (see Gibbs v St. Barnabas Hosp., 16NY3d 74, 79 [2010]; Wilson vGalicia Contr. & Restoration Corp., 10 NY3d 827, 830 [2008]; Wei Hong Hu v Sadiqi, 83 AD3d820, 821 [2011]; Alphonse v UBJ Inc., 266 AD2d 171 [1999]). In seeking to berelieved from the consequences of that noncompliance, the appellants failed to demonstrate areasonable excuse for such noncompliance, and the existence of a potentially meritorious claimor defense (see Gibbs v St. Barnabas Hosp., 16 NY3d at 79; see Wei Hong Hu vSadiqi, 83 AD3d at 821; Nurse vFigeroux & Assoc., 47 AD3d 778 [2008]; Alphonse v UBJ Inc., 266 AD2d at171). Specifically, the appellants failed to adequately explain and document their claim of lawoffice failure (see Campbell-Jarvis vAlves, 68 AD3d 701, 702 [2009]; cf. Nurse v Figeroux & Assoc., 47 AD3d at779). Under the circumstances, any alleged negligence by the appellants' former attorney wasproperly imputed to the appellants because of their failure to ascertain the status of the case (see Diamond Truck Leasing Corp. v CrossCountry Ins. Brokerage, Inc., 62 AD3d 745 [2009]; Santiago v Santana, 54 AD3d 929, 930 [2008]; Nurse vFigeroux & Assoc., 47 AD3d at 779; Edwards v Feliz, 28 AD3d 512, 513 [2006]; MRI Enters. vAmanat, 263 AD2d 530, 531 [1999]; cf. L&L Auto Distribs. & Suppliers Inc. v Auto Collection, Inc., 85AD3d 734, 735-736 [2011]). Moreover, in the mortgage and loan documents, Eagle waivedits right to assert defenses or counterclaims in response to any action commenced by Archer toenforce Eagle's obligations thereunder and to recover the debt. Although the appellants'counterclaim alleging fraud survives such a waiver (see North Fork Bank v ComputerizedQuality Separation Corp., 62 AD3d at 974), that counterclaim was supported only byconclusory allegations against Archer (see Eurycleia Partners, LP v Seward & Kissel, LLP, 12 NY3d 553,559 [2009]; Heffez v L & G Gen. Constr., Inc., 56 AD3d 526, 527 [2008];Quest Commercial, LLC v Rovner, 35 AD3d at 577; Old Republic Natl. Tit. Ins. Co. v Cardinal Abstract Corp., 14 AD3d678, 680 [2005]; E.D.S. Sec. Sys. v Allyn, 262 AD2d 351 [1999]). The appellants'specific allegations of fraud were not directed at Archer, but at the appellants' own transactionalattorney.
Accordingly, the Supreme Court properly granted those branches of Archer's motion whichwere for summary judgment on the complaint, for the appointment of a referee to compute theamount due to it, and for leave to seek a deficiency judgment. Balkin, J.P., Chambers, Hall andAustin, JJ., concur. [Prior Case History: 2010 NY Slip Op 33226(U).]