Preview
FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538
NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022
"H"
EXHIBIT
FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538
NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022
STATE OF NEW YORK
SUPREME COURT COUNTY OF SARATOGA
CANNONE VENTURES, INC.,
DECISION AND ORDER
Plaintiffs, Index No.: 20143353
RJI No.: 45-1-2019-0755
-against-
SALIMAH K. BADRUDDIN, a/k/a SALIMAH hy
BADRUDDIN, YASMIN NURANI KADERALI
BADRUDDIN and ROBERT H. HAFNER, ESQ., )c
Special Administrator of the Estate of Mohamed o
K. Badruddin a/k/a Mohamed Kaderali Badruddin, a
Defendants. co
PRESENT: HON. DIANNE N. FREESTONE
Supreme Court Justice
APPEARANCES:
Anthony P. Adang, Esq.
King, Adang & Arpey
Attorney for Plaintiff
Saratoga Springs, New York
This matter comes before the Court following an inquest that was held on July 29, 2021.
Previously, on April 16, 2018, the Hon. Robert J. Chauvin issued a conditional order granting
plaintiff's motion to strike defendants Salimah K. Badruddin and Yasmin Badruddin (hereinafter
collectively referred to as "defendants") respective answers unless they produced certain discovery
thereof."
within 90 "days from the date of notice of entry and due proof of service Subsequently,
this matter was reassigned to the Hon. Thomas D. Nolan, Jr. who issued a decision and order dated
December 16, 2019 which, among other things, granted defendant Robert H. Hafner's motion for
FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538
NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022
120' defendants'
summary judgment dismissing the cause of action against him, denied motion for
summary judgrnent, granted plaintiff's motion for default judgment on the issue of liability against
the defendants on allcauses of action alleged against them in the amended verified complaint, and
set this matter down for an inquest to determine plaintiff's damages. By correspondence dated
May 27, 2021, defendants were provided notice of the subject inquest. By decision and order
defendants' reconsideration"
dated July 26, 2021, the Court denied "[m]otion ...for and advised
defendants of their right to appear, contest and cross-examine plaintiff's witnesses at the scheduled
inquest.
On July 29, 2021, plaintiff appeared with counsel at the scheduled inquest. Shortly before
the commencement of the inquest, defendants notified the Court by e-mail that they would not be
attending the inquest and would await the decision of the Court. John L. Carumone (hereinafter
referred to as "Mr. Carmone"), the sole member of Cannone Ventures, Inc., and Scott F. Schulz
(hereinafter referred to as Mr. Schulz"), a certified valuation analyst and partner at Valuation
Resource Group, LLC, testified on behalf of the plaintiff. The Court found their testimony to be
credible. Defendants failed to appear or offer any proof in mitigation of damages. The Court took
judicial notice of the pleadings and the Court s (Nolan, 1, Chauvin, J. and Muller, J.) prior
decisions and orders (see Plaintiff's Exhibits 1 through 4). The Court received in evidence
approximately 54 exhibits (see Plaintiff's Exhibits 5 through 44, 44A, 44B, 45, 45A, 45B and 46
through 54).
On March 14, 2014, the parties entered into a written agreement wherein plaintiff agreed
to purchase the Bluebird Terrace Mobile Home Park for $925,000.00. Plaintiff is now seeking to
10"'
recover damages pursuant to the 60', 7 and causes of action in the amended complaint.
2
FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538
NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022
Plaintiff maintains, inter alia, that the documents and writings concerning the income and expenses
of the Bluebird Terrace Mobile Home Park provided and furnished to plaintiff by defendants were
false, misleading and untrue and were intended to induce and deceive plaintiff into purchasing said
property. Based on said deceit and the false statements made in connection with the purchase of
the Bluebird Terrace Mobile Home Park, plaintiff isseeking damages measured by the difference
between the purchase price of the mobile home park and the actual value of said property on the
date of the closing.
It is well settled that in actions for fraud and deceit "'[t]he true measure of damage is
wrong'
indemnity for theactual pecuniary loss sustained as the direct result of the or what isknown
'out-of-pocket'
as the rule. Under this rule, the loss is computed by ascertaining the difference
between the value of the bargain which ...plaintiff was induced by fraud to make and the amount
bargain'"
or value of the consideration exacted as the price of the (Southwestern Iny'rs Group,
LLC v JH Portfolio Debt Equities, LLC, 169 AD3d 1510, 1511 [4th Dept 2019], quoting Lama
Holding Co. v Smith Barney Inc., 88 NY2d 413, 421 [1996]; see Rte. 217, LLC v Greer, 119 AD3d
1018, 1019[3d Dept 2014]). Therefore, the damages herein should be "measured by the difference
between the purchase price of the [Bluebird Terrace Mobile Home Park] and the actual value of
[said property on the date of the closing], given the false statements made in connection with the
purchase"
(Beta Holdings. Inc. v Goldsmith, 129 AD3d 521, 522 [1st Dept 2015]; see Ungewitter
v Toch, 31 AD2d 583, 584 [3d Dept 1968], affd, 26 NY2d 687 [1970]). Furthermore, exemplary
or "[p]unitive damages may be awarded in actions for fraud and deceit only where the fraud is
public"
gross, involves high moral culpability, and is aimed at the general (Marcus v Marcus, 92
AD2d 887, 887 [2d Dept 1983]; see Walker v Sheldon, 10 NY2d 401, 405 [1961]; Gale v Kessler,
3
FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538
NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022
93 AD2d 744, 745 [1st Dept 1983]).
parties'
Mr. Cannone testified that the closing occurred on July 14, 2014. The contract
indicates that the purchase price of the property was $925,000.00. Mr. Shulz opined that the value
of the Bluebird Terrace Mobile Home Park on July 14, 2014, was between $393,000.00 (i.e.based
on the bank statementswom 2011 and 2013) and $613,000.00 (i.e. based on the rent rolls between
2011 and 2013). In summation, plaintiff's counsel conceded that Mr. Shulz's valuation based on
the rent rollswould probably be the most reliable, since itwas based off the rent rollsprovided by
defendants. Accordingly, the Court finds that plaintiff is entitled to damages based on the
difference between the purchase price of the property (i.e.$925.000.00) and the actual value of
said propeity on the date of the closing (i.e.$613,000.00). Plaintiff is also entitled to recover
$2,292.92 under its tenth cause of action. However, the Court finds that plaintiff was unable to
establish itsentitlement to punitive damages as it relates to the lastelement wherein defendants
conduct must have been part of a pattern directed at the public (see generally J. G. S., Inc. v
Lifetime Cutlery Corp., 87 AD2d 8 10, 810 [2d Dept 1982]). Therefore, based upon the credible
testimony adduced before me and the exhibit(s) received in evidence herein, and due deliberation
having been had thereon, the Court finds and decides that plaintiff be awarded damages in the
amount of $314,292.92, with statutory interest from July 14, 2014 (see CPLR 5001[c]; CDR
Creances S.A. v Cohen, 104 AD3d 17, 30 [1st Dept 2012]). Plaintiff is hereby directed to prepare
and submit a Judgment directly to the Saratoga County Clerk that is consistent with the Court s
Decision and Order herein.
The foregoing constitutes the Decision and Order of the Court. The Court is hereby
forwarding the original Decision and Order to the Supreme Court Clerk/County Clerk for filing.
4
FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538
NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022
Counsel isnot relieved from the applicable provisions of CPLR 2220 to and service
relating filing
of notice of entry of this Decision and Order.
3rd
Signed this day of August 2021, at Saratoga New York.
Springs,
HON. DIANNE N. FREESTONE
Supreme Court Justice
ENTER w o> t$
ENTERED : --1
Craig A, Hayner
5
Preview
FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538 NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022 "H" EXHIBIT FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538 NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022 STATE OF NEW YORK SUPREME COURT COUNTY OF SARATOGA CANNONE VENTURES, INC., DECISION AND ORDER Plaintiffs, Index No.: 20143353 RJI No.: 45-1-2019-0755 -against- SALIMAH K. BADRUDDIN, a/k/a SALIMAH hy BADRUDDIN, YASMIN NURANI KADERALI BADRUDDIN and ROBERT H. HAFNER, ESQ., )c Special Administrator of the Estate of Mohamed o K. Badruddin a/k/a Mohamed Kaderali Badruddin, a Defendants. co PRESENT: HON. DIANNE N. FREESTONE Supreme Court Justice APPEARANCES: Anthony P. Adang, Esq. King, Adang & Arpey Attorney for Plaintiff Saratoga Springs, New York This matter comes before the Court following an inquest that was held on July 29, 2021. Previously, on April 16, 2018, the Hon. Robert J. Chauvin issued a conditional order granting plaintiff's motion to strike defendants Salimah K. Badruddin and Yasmin Badruddin (hereinafter collectively referred to as "defendants") respective answers unless they produced certain discovery thereof." within 90 "days from the date of notice of entry and due proof of service Subsequently, this matter was reassigned to the Hon. Thomas D. Nolan, Jr. who issued a decision and order dated December 16, 2019 which, among other things, granted defendant Robert H. Hafner's motion for FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538 NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022 120' defendants' summary judgment dismissing the cause of action against him, denied motion for summary judgrnent, granted plaintiff's motion for default judgment on the issue of liability against the defendants on allcauses of action alleged against them in the amended verified complaint, and set this matter down for an inquest to determine plaintiff's damages. By correspondence dated May 27, 2021, defendants were provided notice of the subject inquest. By decision and order defendants' reconsideration" dated July 26, 2021, the Court denied "[m]otion ...for and advised defendants of their right to appear, contest and cross-examine plaintiff's witnesses at the scheduled inquest. On July 29, 2021, plaintiff appeared with counsel at the scheduled inquest. Shortly before the commencement of the inquest, defendants notified the Court by e-mail that they would not be attending the inquest and would await the decision of the Court. John L. Carumone (hereinafter referred to as "Mr. Carmone"), the sole member of Cannone Ventures, Inc., and Scott F. Schulz (hereinafter referred to as Mr. Schulz"), a certified valuation analyst and partner at Valuation Resource Group, LLC, testified on behalf of the plaintiff. The Court found their testimony to be credible. Defendants failed to appear or offer any proof in mitigation of damages. The Court took judicial notice of the pleadings and the Court s (Nolan, 1, Chauvin, J. and Muller, J.) prior decisions and orders (see Plaintiff's Exhibits 1 through 4). The Court received in evidence approximately 54 exhibits (see Plaintiff's Exhibits 5 through 44, 44A, 44B, 45, 45A, 45B and 46 through 54). On March 14, 2014, the parties entered into a written agreement wherein plaintiff agreed to purchase the Bluebird Terrace Mobile Home Park for $925,000.00. Plaintiff is now seeking to 10"' recover damages pursuant to the 60', 7 and causes of action in the amended complaint. 2 FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538 NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022 Plaintiff maintains, inter alia, that the documents and writings concerning the income and expenses of the Bluebird Terrace Mobile Home Park provided and furnished to plaintiff by defendants were false, misleading and untrue and were intended to induce and deceive plaintiff into purchasing said property. Based on said deceit and the false statements made in connection with the purchase of the Bluebird Terrace Mobile Home Park, plaintiff isseeking damages measured by the difference between the purchase price of the mobile home park and the actual value of said property on the date of the closing. It is well settled that in actions for fraud and deceit "'[t]he true measure of damage is wrong' indemnity for theactual pecuniary loss sustained as the direct result of the or what isknown 'out-of-pocket' as the rule. Under this rule, the loss is computed by ascertaining the difference between the value of the bargain which ...plaintiff was induced by fraud to make and the amount bargain'" or value of the consideration exacted as the price of the (Southwestern Iny'rs Group, LLC v JH Portfolio Debt Equities, LLC, 169 AD3d 1510, 1511 [4th Dept 2019], quoting Lama Holding Co. v Smith Barney Inc., 88 NY2d 413, 421 [1996]; see Rte. 217, LLC v Greer, 119 AD3d 1018, 1019[3d Dept 2014]). Therefore, the damages herein should be "measured by the difference between the purchase price of the [Bluebird Terrace Mobile Home Park] and the actual value of [said property on the date of the closing], given the false statements made in connection with the purchase" (Beta Holdings. Inc. v Goldsmith, 129 AD3d 521, 522 [1st Dept 2015]; see Ungewitter v Toch, 31 AD2d 583, 584 [3d Dept 1968], affd, 26 NY2d 687 [1970]). Furthermore, exemplary or "[p]unitive damages may be awarded in actions for fraud and deceit only where the fraud is public" gross, involves high moral culpability, and is aimed at the general (Marcus v Marcus, 92 AD2d 887, 887 [2d Dept 1983]; see Walker v Sheldon, 10 NY2d 401, 405 [1961]; Gale v Kessler, 3 FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538 NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022 93 AD2d 744, 745 [1st Dept 1983]). parties' Mr. Cannone testified that the closing occurred on July 14, 2014. The contract indicates that the purchase price of the property was $925,000.00. Mr. Shulz opined that the value of the Bluebird Terrace Mobile Home Park on July 14, 2014, was between $393,000.00 (i.e.based on the bank statementswom 2011 and 2013) and $613,000.00 (i.e. based on the rent rolls between 2011 and 2013). In summation, plaintiff's counsel conceded that Mr. Shulz's valuation based on the rent rollswould probably be the most reliable, since itwas based off the rent rollsprovided by defendants. Accordingly, the Court finds that plaintiff is entitled to damages based on the difference between the purchase price of the property (i.e.$925.000.00) and the actual value of said propeity on the date of the closing (i.e.$613,000.00). Plaintiff is also entitled to recover $2,292.92 under its tenth cause of action. However, the Court finds that plaintiff was unable to establish itsentitlement to punitive damages as it relates to the lastelement wherein defendants conduct must have been part of a pattern directed at the public (see generally J. G. S., Inc. v Lifetime Cutlery Corp., 87 AD2d 8 10, 810 [2d Dept 1982]). Therefore, based upon the credible testimony adduced before me and the exhibit(s) received in evidence herein, and due deliberation having been had thereon, the Court finds and decides that plaintiff be awarded damages in the amount of $314,292.92, with statutory interest from July 14, 2014 (see CPLR 5001[c]; CDR Creances S.A. v Cohen, 104 AD3d 17, 30 [1st Dept 2012]). Plaintiff is hereby directed to prepare and submit a Judgment directly to the Saratoga County Clerk that is consistent with the Court s Decision and Order herein. The foregoing constitutes the Decision and Order of the Court. The Court is hereby forwarding the original Decision and Order to the Supreme Court Clerk/County Clerk for filing. 4 FILED: SARATOGA COUNTY CLERK 06/23/2022 05:44 PM INDEX NO. EF20212538 NYSCEF DOC. NO. 43 RECEIVED NYSCEF: 06/23/2022 Counsel isnot relieved from the applicable provisions of CPLR 2220 to and service relating filing of notice of entry of this Decision and Order. 3rd Signed this day of August 2021, at Saratoga New York. Springs, HON. DIANNE N. FREESTONE Supreme Court Justice ENTER w o> t$ ENTERED : --1 Craig A, Hayner 5