Preview
FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023
SUPREME COURT OF THE STATE OF NEW YORK Index No.
COUNTY OF SUFFOLK
--------------------------------------------------------------------X
MARIE HOLDINGS, INC.
Plaintiff,
-against-
AFFIRMATION IN
SUPPORT
BRUCE KENNEDY and BRUCE KENNEDY, P.C.,
Defendants.
--------------------------------------------------------------------X
SCOTT J. KREPPEIN, an attorney duly admitted to practice before this
Court, affirms the following under penalty of perjury:
1. I am a partner with Devitt Spellman Barrett, LLP, counsel for Plaintiff
herein, and as such I am fully familiar with the facts and circumstances of this case.
2. This affirmation is respectfully submitted in support of Plaintiff’s
motion for summary judgment in lieu of complaint, which should be granted because
Plaintiff was the intended beneficiary of $890,870.00 in escrowed funds that were
held by Defendants, which were supposed to have been delivered to Plaintiff on
September 17, 2021, but Defendants sent the money to the wrong recipient and it
could not be recovered.
1
1 of 8
FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023
FACTS
3. Marie Holdings, Inc., is a domestic business corporation organized
under and existing by virtue of the laws of the State of New York, with its principal
place of business located in Nassau County, New York.
4. Bruce Kennedy, P.C., is a domestic professional services corporation
organized under and existing by virtue of the laws of the State of New York, with its
principal place of business located in Suffolk County, New York.
5. Bruce Kennedy is an attorney duly admitted to practice law in the State
of New York who, upon information and belief, resides in Suffolk County, New York.
6. In or around August and September, 2021, Bruce Kennedy, individually
and as the principal of Bruce Kennedy, P.C., acted as an escrow agent at the behest
of non-party Ira Sumkin -- and/or business entities Mr. Sumkin is affiliated with
and/or third-parties who had loaned Mr. Sumkin or his businesses money – in
connection with making a partial payment towards a loan owed by Mr. Sumkin and
his business entities to Plaintiff.
7. On August 16, 2021, Defendants wrote to Plaintiff’s counsel on behalf of
Mr. Sumkin and his business entities inquiring about a partial pay down of a
mortgage loan owed by Mr. Sumkin and his affiliated business entities.
(Correspondence, Exhibit “A”).
8. In or around September 2021, Bruce Kennedy and/or Bruce Kennedy
P.C. received and held the sum of $890,870.00 in escrow, pursuant to an agreement
between Defendants and Ira Sumkin and/or other persons or entities affiliated with
2
2 of 8
FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023
Mr. Sumkin, with the specific intent and purpose of transmitting said sum to Marie
Holdings, Inc.
9. It is unclear if Mr. Kennedy had a written retainer or escrow agreement
with Mr. Sumkin or any other third-party with respect to the $890,870.00 that he
held in escrow for delivery to Defendant.
10. On September 9, 2021, Plaintiff, by counsel, transmitted a forbearance
agreement to Defendant, annexed hereto as Exhibit “B,” to be executed by Mr.
Sumkin and returned with payment of $884,750 plus $360.00 per day from
September 1, 2021 forward, with a deadline of September 17, 2021 to accept said
agreement. On or about September 13, 2021, Mr. Sumkin executed the
aforementioned forbearance agreement and delivered it to Defendants with
instructions to release the escrowed funds to Plaintiff. Id.
11. On September 17, 2021, at approximately 7:12am, Plaintiff
countersigned the forbearance agreement and emailed it to Defendants with wire
instructions for the transmission of the sum of $890,870.00 to Marie Holdings, Inc.
(Correspondence, Exhibit “A”).
12. The wire instructions provided by Plaintiff to Defendant were the same
wire instructions that had previously been provided to Mr. Sumkin in connection with
other transactions, and Plaintiff’s principal and counsel were available to confirm
said instructions if requested.
3
3 of 8
FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023
13. Upon information and belief, on September 17, 2021, Defendants wired
the $890,870.00 that had been entrusted with them in escrow for delivery to Plaintiff
to the wrong recipient.
14. To date, the $890,870.00 that Defendants were supposed to wire to
Plaintiff but instead wired to the wrong recipient have not been recovered or received
by Plaintiff. Upon information and belief, Mr. Sumkin promptly retained counsel and
demand was promptly made upon Defendants and their malpractice carrier but, to
date, they have been unwilling or unable to remedy the situation. See Sumkin v.
Kennedy, Suffolk Co. Index No. 623483/2021.
DISCUSSION
15. Pursuant to New York Rule of Professional Responsibility 1.15(c)(4), a
lawyer acting as escrow agent must “promptly pay or deliver to the client or third
person as requested by the client or third person the funds, securities, or other
properties in the possession of the lawyer that the client or third person is entitled to
receive.”
16. An escrowee “is a trustee for both parties,” who has “a duty not to deliver
the escrow to any one except upon strict compliance with the conditions imposed, and
even subjects him to damages for his failure.” Farago v. Burke, 262 N.Y. 229, 233
(1933). See also Baquerizo v. Monasterio, 90 A.D.3d 587, 587, 933 N.Y.S.2d 869 (2d
Dept. 2011). An escrowee not merely a fiduciary of a depositor, but also of the
intended recipient, to whom they owe the “highest kind of loyalty.” Bardach v. Chain
Bakers, 265 A.D. 24, 27 (1st Dept. 1942) aff'd 290 N.Y. 813 (1943). Accordingly, the
4
4 of 8
FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023
intended beneficiary of escrow funds has a direct action against an escrow agent when
said funds are not delivered when required. Oppenheim v. Simon, 57 A.D.2d 1006,
1007 (3d Dept. 1977) citing Farago, 262 N.Y., 233; see also U.S. v. Jacobs, 304 F.
Supp. 613, 622 (S.D.N.Y. 1969).
17. The expedited procedure of C.P.L.R. § 3213 is generally used for bounced
checks and other commercial paper, but is permissible for recovery upon any “written
instruments which unconditionally acknowledge a debt obligation,” including
correspondence evidencing an unconditional obligation. Maglich v. Saxe, Bacon &
Bolan, P.C., 97 A.D.2d 19, 21 (1st Dept. 1983). The issue is whether the instrument
calls for payment of money “only,” or requires “some other condition or performance”
thereby making the simplified procedure of seeking summary judgment in lieu of a
complaint inapplicable.
18. Here, the expedited procedure should be applicable, as Defendants’
obligation as escrowee was simply to pay the sum of $890,870.00 to Plaintiff, which
they failed to do. Defendants should have had a written retainer or escrow
agreement, which Plaintiff would be a third-party beneficiary of, but regardless their
obligations to turn over the escrowed funds was a simply obligation to pay money
only, and the correspondence and forbearance agreement should satisfy the
“instrument” requirement of C.P.L.R. § 3213.
19. In the event the expedited procedure of summary judgment in lieu of a
complaint is found to be inapplicable, the “moving and answering papers shall be
deemed the complaint and answer, respectively, unless the court orders otherwise.”
5
5 of 8
FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023
C.P.L.R. § 3213. If it is merely a technical deficiency, where the agreement at issue
does not qualify as an instrument for the payment of money only but based upon the
submissions the Plaintiff is nonetheless entitled to Judgment as a matter law, the
Court has discretion to convert the motion under C.P.L.R. § 3213 into an ordinary
summary judgment motion under C.P.L.R. § 3212. Big K Kosher Dairy Rest., Inc. v.
Gross, 198 A.D.2d 205, 206 (2d Dept. 1993).
CONCLUSION
WHEREFORE, it is respectfully requested that a money Judgment be entered
in favor of Plaintiff MARIE HOLDINGS, INC., against Defendants BRUCE
KENNEDY and BRUCE KENNEDY, P.C., and each of them, in the sum of EIGHT-
HUNDRED NINETY THOUSAND EIGHT-HUNDRED AND SEVENTY DOLLARS
($890,870.00), with interest thereof from September 17, 2021; together with cost and
disbursements, and such other and further relief in Plaintiff’s favor as is deemed just,
equitable, and proper.
Dated: October 11, 2023 Respectfully submitted,
DEVITT SPELLMAN BARRETT, LLP
/s/ Scott Kreppein
By: Scott Kreppein
50 Route 111, Ste 314
Smithtown, NY 11787
(631) 724-8833
6
6 of 8
FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023
WORD COUNT CERTIFICATION
SCOTT J. KREPPEIN, an attorney duly admitted to practice before the
Courts of the State of New York, affirms the following under penalty of perjury:
The within affirmation was prepared on a computer using MS Word. The
typeface is Century, 12 point, and the total wordcount is: 1,366.
Dated: October 11, 2023
DEVITT SPELLMAN BARRETT, LLP
/s/ Scott Kreppein
By: Scott Kreppein
50 Route 111, Ste 314
Smithtown, NY 11787
(631) 724-8833
7
7 of 8
FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023
TAKE FURTHER NOTICE, opposition papers, if any, must be served upon the
undersigned at least seven (7) days prior to the return date hereof; failure to timely serve and file
opposition may result in the relief sought herein being granted on default.
Dated: October 11, 2023 Yours,
DEVITT SPELLMAN BARRETT, LLP
/s/ Scott Kreppein
____________________________________
By: Scott J. Kreppein
50 Route 111, Ste 314
Smithtown, NY 11787
(631) 724-8833
8 of 8
Preview
FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023 SUPREME COURT OF THE STATE OF NEW YORK Index No. COUNTY OF SUFFOLK --------------------------------------------------------------------X MARIE HOLDINGS, INC. Plaintiff, -against- AFFIRMATION IN SUPPORT BRUCE KENNEDY and BRUCE KENNEDY, P.C., Defendants. --------------------------------------------------------------------X SCOTT J. KREPPEIN, an attorney duly admitted to practice before this Court, affirms the following under penalty of perjury: 1. I am a partner with Devitt Spellman Barrett, LLP, counsel for Plaintiff herein, and as such I am fully familiar with the facts and circumstances of this case. 2. This affirmation is respectfully submitted in support of Plaintiff’s motion for summary judgment in lieu of complaint, which should be granted because Plaintiff was the intended beneficiary of $890,870.00 in escrowed funds that were held by Defendants, which were supposed to have been delivered to Plaintiff on September 17, 2021, but Defendants sent the money to the wrong recipient and it could not be recovered. 1 1 of 8 FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023 FACTS 3. Marie Holdings, Inc., is a domestic business corporation organized under and existing by virtue of the laws of the State of New York, with its principal place of business located in Nassau County, New York. 4. Bruce Kennedy, P.C., is a domestic professional services corporation organized under and existing by virtue of the laws of the State of New York, with its principal place of business located in Suffolk County, New York. 5. Bruce Kennedy is an attorney duly admitted to practice law in the State of New York who, upon information and belief, resides in Suffolk County, New York. 6. In or around August and September, 2021, Bruce Kennedy, individually and as the principal of Bruce Kennedy, P.C., acted as an escrow agent at the behest of non-party Ira Sumkin -- and/or business entities Mr. Sumkin is affiliated with and/or third-parties who had loaned Mr. Sumkin or his businesses money – in connection with making a partial payment towards a loan owed by Mr. Sumkin and his business entities to Plaintiff. 7. On August 16, 2021, Defendants wrote to Plaintiff’s counsel on behalf of Mr. Sumkin and his business entities inquiring about a partial pay down of a mortgage loan owed by Mr. Sumkin and his affiliated business entities. (Correspondence, Exhibit “A”). 8. In or around September 2021, Bruce Kennedy and/or Bruce Kennedy P.C. received and held the sum of $890,870.00 in escrow, pursuant to an agreement between Defendants and Ira Sumkin and/or other persons or entities affiliated with 2 2 of 8 FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023 Mr. Sumkin, with the specific intent and purpose of transmitting said sum to Marie Holdings, Inc. 9. It is unclear if Mr. Kennedy had a written retainer or escrow agreement with Mr. Sumkin or any other third-party with respect to the $890,870.00 that he held in escrow for delivery to Defendant. 10. On September 9, 2021, Plaintiff, by counsel, transmitted a forbearance agreement to Defendant, annexed hereto as Exhibit “B,” to be executed by Mr. Sumkin and returned with payment of $884,750 plus $360.00 per day from September 1, 2021 forward, with a deadline of September 17, 2021 to accept said agreement. On or about September 13, 2021, Mr. Sumkin executed the aforementioned forbearance agreement and delivered it to Defendants with instructions to release the escrowed funds to Plaintiff. Id. 11. On September 17, 2021, at approximately 7:12am, Plaintiff countersigned the forbearance agreement and emailed it to Defendants with wire instructions for the transmission of the sum of $890,870.00 to Marie Holdings, Inc. (Correspondence, Exhibit “A”). 12. The wire instructions provided by Plaintiff to Defendant were the same wire instructions that had previously been provided to Mr. Sumkin in connection with other transactions, and Plaintiff’s principal and counsel were available to confirm said instructions if requested. 3 3 of 8 FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023 13. Upon information and belief, on September 17, 2021, Defendants wired the $890,870.00 that had been entrusted with them in escrow for delivery to Plaintiff to the wrong recipient. 14. To date, the $890,870.00 that Defendants were supposed to wire to Plaintiff but instead wired to the wrong recipient have not been recovered or received by Plaintiff. Upon information and belief, Mr. Sumkin promptly retained counsel and demand was promptly made upon Defendants and their malpractice carrier but, to date, they have been unwilling or unable to remedy the situation. See Sumkin v. Kennedy, Suffolk Co. Index No. 623483/2021. DISCUSSION 15. Pursuant to New York Rule of Professional Responsibility 1.15(c)(4), a lawyer acting as escrow agent must “promptly pay or deliver to the client or third person as requested by the client or third person the funds, securities, or other properties in the possession of the lawyer that the client or third person is entitled to receive.” 16. An escrowee “is a trustee for both parties,” who has “a duty not to deliver the escrow to any one except upon strict compliance with the conditions imposed, and even subjects him to damages for his failure.” Farago v. Burke, 262 N.Y. 229, 233 (1933). See also Baquerizo v. Monasterio, 90 A.D.3d 587, 587, 933 N.Y.S.2d 869 (2d Dept. 2011). An escrowee not merely a fiduciary of a depositor, but also of the intended recipient, to whom they owe the “highest kind of loyalty.” Bardach v. Chain Bakers, 265 A.D. 24, 27 (1st Dept. 1942) aff'd 290 N.Y. 813 (1943). Accordingly, the 4 4 of 8 FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023 intended beneficiary of escrow funds has a direct action against an escrow agent when said funds are not delivered when required. Oppenheim v. Simon, 57 A.D.2d 1006, 1007 (3d Dept. 1977) citing Farago, 262 N.Y., 233; see also U.S. v. Jacobs, 304 F. Supp. 613, 622 (S.D.N.Y. 1969). 17. The expedited procedure of C.P.L.R. § 3213 is generally used for bounced checks and other commercial paper, but is permissible for recovery upon any “written instruments which unconditionally acknowledge a debt obligation,” including correspondence evidencing an unconditional obligation. Maglich v. Saxe, Bacon & Bolan, P.C., 97 A.D.2d 19, 21 (1st Dept. 1983). The issue is whether the instrument calls for payment of money “only,” or requires “some other condition or performance” thereby making the simplified procedure of seeking summary judgment in lieu of a complaint inapplicable. 18. Here, the expedited procedure should be applicable, as Defendants’ obligation as escrowee was simply to pay the sum of $890,870.00 to Plaintiff, which they failed to do. Defendants should have had a written retainer or escrow agreement, which Plaintiff would be a third-party beneficiary of, but regardless their obligations to turn over the escrowed funds was a simply obligation to pay money only, and the correspondence and forbearance agreement should satisfy the “instrument” requirement of C.P.L.R. § 3213. 19. In the event the expedited procedure of summary judgment in lieu of a complaint is found to be inapplicable, the “moving and answering papers shall be deemed the complaint and answer, respectively, unless the court orders otherwise.” 5 5 of 8 FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023 C.P.L.R. § 3213. If it is merely a technical deficiency, where the agreement at issue does not qualify as an instrument for the payment of money only but based upon the submissions the Plaintiff is nonetheless entitled to Judgment as a matter law, the Court has discretion to convert the motion under C.P.L.R. § 3213 into an ordinary summary judgment motion under C.P.L.R. § 3212. Big K Kosher Dairy Rest., Inc. v. Gross, 198 A.D.2d 205, 206 (2d Dept. 1993). CONCLUSION WHEREFORE, it is respectfully requested that a money Judgment be entered in favor of Plaintiff MARIE HOLDINGS, INC., against Defendants BRUCE KENNEDY and BRUCE KENNEDY, P.C., and each of them, in the sum of EIGHT- HUNDRED NINETY THOUSAND EIGHT-HUNDRED AND SEVENTY DOLLARS ($890,870.00), with interest thereof from September 17, 2021; together with cost and disbursements, and such other and further relief in Plaintiff’s favor as is deemed just, equitable, and proper. Dated: October 11, 2023 Respectfully submitted, DEVITT SPELLMAN BARRETT, LLP /s/ Scott Kreppein By: Scott Kreppein 50 Route 111, Ste 314 Smithtown, NY 11787 (631) 724-8833 6 6 of 8 FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023 WORD COUNT CERTIFICATION SCOTT J. KREPPEIN, an attorney duly admitted to practice before the Courts of the State of New York, affirms the following under penalty of perjury: The within affirmation was prepared on a computer using MS Word. The typeface is Century, 12 point, and the total wordcount is: 1,366. Dated: October 11, 2023 DEVITT SPELLMAN BARRETT, LLP /s/ Scott Kreppein By: Scott Kreppein 50 Route 111, Ste 314 Smithtown, NY 11787 (631) 724-8833 7 7 of 8 FILED: SUFFOLK COUNTY CLERK 10/19/2023 10:16 AM INDEX NO. 625260/2023 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 10/19/2023 TAKE FURTHER NOTICE, opposition papers, if any, must be served upon the undersigned at least seven (7) days prior to the return date hereof; failure to timely serve and file opposition may result in the relief sought herein being granted on default. Dated: October 11, 2023 Yours, DEVITT SPELLMAN BARRETT, LLP /s/ Scott Kreppein ____________________________________ By: Scott J. Kreppein 50 Route 111, Ste 314 Smithtown, NY 11787 (631) 724-8833 8 of 8