CFG Merchant Solutions, LLC v. Home Media Tech Fl Inc.

2024 NY Slip Op 33653(U)

• Court: New York Supreme Court, Kings County
• Decided: October 15, 2024
• Docket: Index No. 516828/2023
• Status: Unpublished

Opinion

CFG Merchant Solutions, LLC v Home Media Tech Fl Inc. 2024 NY Slip Op 33653(U) October 15, 2024 Supreme Court, Kings County Docket Number: Index No. 516828/2023 Judge: Francois A. Rivera Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. FILED: KINGS COUNTY CLERK 10/15/2024 10:41 AM INDEX NO. 516828/2023 NYSCEF DOC. NO. 24 RECEIVED NYSCEF: 10/15/2024

At an IAS Term, Part 52 of the Supreme Court of the State ofNew York, held in and for the County of Kings, at the Courthouse, at Civic Center, Brooklyn, New York, on the 15th day of October 2024 HONORABLE FRANCOIS A. RIVERA -------------------------------------------------------------------X CFG MERCHANT SOLUTIONS, LLC, DECISION & ORDER Plaintiff, Index No.: 516828/2023

- against - Oral Argument: 9/5/2024

HOME MEDIA TECH FL INC DBA Cal. No.: 15 HOME MEDIA TECH FL and ALBA GALINDO, Ms. No ..: 1 Defendants. -------------------------------------------------------------------X Recitation in accordance with CPLR 2219 (a) of the papers considered on the notice of motion filed on January 31, 2024 under motion sequence number one, by CFG Merchant Solutions, LLC (hereinafter the plaintiff) for an order pursuant to CPLR 3212 granting summary judgment on the causes of action in its verified complaint and on the affirmative defenses in the amended verified answer with counterclaims 1 of defendants Home Media Tech Fl Inc dba Home Media Tech Fl (hereinafter the company defendant) and Alba Galindo (hereinafter the individual defendant) (collectively the defendants). The motion is unopposed.

-Notice of motion -Affidavit in support Exhibits A-D -Affirmation in support Exhibits 1-4 -Memorandum of law in support -Statement of material facts

1 The plaintiffs notice of motion states that the plaintiff seeks summary judgment on the causes of action in its verified complaint and on the causes of action in its verified complaint and on the affirmative defenses in the amended verified answer with cotmterclaims of the defendants. However, the defendants' answer does not contain any counterclaims.

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BACKGROUND

On June 8, 2023, plaintiff commenced the instant action by filing a summons and

verified complaint with the Kings County Clerk's office (KCCO). On July 11, 2023, the

defendants jointly interposed and filed an answer with the KCCO.

The verified complaint alleges thirty-one allegations of fact in support of four

causes of action. The first cause of action is for breach of contract. The second is for breach of a guarantee agreement. The third is for attorney fees based on the alleged

breach of the contract and of the guarantee agreement. The fourth is for unjust

enrichment.

The verified complaint alleges the following salient facts. Pursuant to a

receivable purchase agreement (hereinafter the agreement) and personal guarantee dated

February 10, 2023, the plaintiff agreed to purchase 14.97% of the company defendant's

future receivables having an agreed upon value of $244,200.00. By the agreement, the

individual defendant executed a personal guarantee if the company defendant defaulted

on the agreement. Pursuant to the agreement, the company defendant agreed to have one

bank account approved by plaintiff (hereinafter the bank account) from which the

company defendant authorized plaintiff to make daily and/or weekly ACH withdrawals

until $244,200.00 was fully paid to the plaintiff.

On May 9, 2023, the company defendant defaulted under the agreement by

changing the designated bank account without the plaintiffs authorization. It did so by

placing a stop payment on plaintiffs debits to the account or by otherwise taking

measures to interfere with plaintiffs ability to collect the future receivables.

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The company defendant made payments totaling $55,102.00, leaving a balance of

$189,098.00. In addition,.pursuant to the agreement, the company defendant incurred a

UCC fee in the amount of $195.00, a blocked account fee in the amount of $2,500.00,

and a default fee in the amount of $9,454.90, calculated as five percent (5%) of the

undelivered portion of the amount sold, or two thousand five hundred dollars ($2,500.00),

whichever is greater. There remains a balance due and owing to plaintiff on the agreement in the amount of $201,247.90 plus interest, costs, disbursements, and

attorney's fees.

LAW AND APPLICATION

The defendants did not submit opposition to the instant motion. However, a

summary judgment motion should not be granted merely because the party against whom

judgment is sought failed to submit papers in opposition to the motion, i.e. defaulted

(Liberty Taxi Mgt., Inc. v Gincherman, 32 AD3d 276, 278 n [1st Dept 2006], citing

Vermont Teddy Bear Co., v 1-800 Beargram Co;, 373 F3d 241 [2d Cir 2004] ["the failure

to oppose a motion for summary judgment alone does not justify the granting of summary

judgment. Instead, the ... court must still assess whether the moving party has fulfilled its

burden of demonstrating that there is no genuine issue of material fact and its entitlement

to judgment as a matter of law'']; see Cugini v System Lumber Co., Inc., 111 AD2d 114

[1st Dept 1985]).

It is well established that summary judgment may be granted only when no triable

issue of fact exists (Alvarez v Prospect Hospital, 68 NY2d 320 [ 1986]). The burden is

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summary judgment as a matter oflaw by presenting evidence in admissible form

demonstrating the absence of material facts (Giuffrida v Citibank, 10ONY2d 72 [2003]).

A failure to make that showing requires the denial of the summary judgment

motion, regardless of the adequacy of the opposing papers (Ayotte v Gervasio, 81 NY2d

1062 [ 1993 ]). If prima facie showing has been made, the burden shifts to the opposing

party to produce evidentiary proof sufficient to establish the existence of material issues of fact (Alvarez, 68 NY2d at 324).

Pursuant to CPLR 3212 (b), a court will grant a motion for summary judgment

upon a determination that the movant's papers justify holding, as a matter of law, that

there is no defense to the cause of action or that the cause of action or defense has no

merit. Furthennore, all of the evidence must be viewed in the light most favorable to the

opponent of the motion ()✓.tarine Midland Bankv Dino & Artie's Automatic Transmission

Co., 168 AD2d 610 [2dDept 1990]).

The essential elements of a cause of action to recover damages for breach of

contract are "the existence of a contract, the plaintiffs performance pursuant to the

contract, the defendant's breach of its contractual obligations, and damages resulting from

the breach" (Cruz v Cruz, 213 AD3d 805 [2d Dept 2023]). To prevail on this branch of

the instant motion, it was incumbent upon the plaintiff to prove each of these elements as

a matter of law.

"The elements of a cause of action to recover for unjust enrichment are (I) the

defendant was enriched, (2) at the plaintiffs expense, and (3) that it is against equity and

good conscience to permit the defendant to retain what is sought to be recovered" (Sarker Page 4 of7

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v Das, 203 AD3d 973, 975 [2d Dept 2022], citing Financial Assistance, Inc. v Graham,

191 AD3d 952, 956 [2d Dept 2021 ]). A plaintiffs cause of action for unjust enrichment

may not be maintained if "a valid contract governing the subject matter" exists (CS!

Group, LLP v Harper, 153 AD3d 1314, 1317 [2d Dept 2017]). Under such

circumstances, "recovery in quasi contract for events arising out of the same subject

matter" are generally precluded (CS/Group, LLP v Harper, 153 AD3d 1314, 1317 [2d

Dept 2017], citing EBC I, Inc. v Goldman, Sachs & Co., 5 NY3d 11, 23 [2005]; Clark-

Fitzpatrick, Inc. v Long Is. R.R. Co., 70 NY2d 382, 388 [1987]). Here, plaintiffs claim

for breach of contract is undisputedly based on the agreement to purchase the company

defendant's future receivables. Consequently, the plaintiff may not maintain a claim for

unjust enrichment.

The only sworn testimony proffered in support of the motion is an affirmation of

Steven W. Wells, plaintiffs counsel (hereinafter Wells) and an affidavit ofJaines Elder,

the collection manager of the plaintiff (hereinafter Elder). Well's affirmation

demonstrates no personal knowledge of any of the transactional facts alleged in the

complaint. "An attorney's affirmation that is not based upon personal knowledge is of no

probative or evidentiary significance" (Nerayoff v Khorshad, 168 AD3d 866, 867 [2d

Dept2019], quoting Warrington v Ryder Truck Rental, Inc., 35 AD3d 455,456 [2d Dept

2006]).

Elder avers personal knowledge of the plaintiffs business practices and

procedures. He further avers that the factual allegations proffered in support of the

motion for summary judgment are derived from his review of the plaintiffs business

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records. He then refers to the four documents attached to the motion, which he described

as the agreement, a remittance history, proof of payment, and an ACHWorks Return

Report.

Elder avers that pursuant to the agreement, the plaintiff purchased 14.97% of the

company defendant's total future receipts up to the sum of $165,000 (hereinafter the

amount sold) in exchange for an upfront purchase price of $244,200.00 2. Elder avers that

on February 10, 2023, plaintiff funded the purchase price (less applicable and disclosed

upfront fees of $2,934 by applying $84,321 to satisfy the company defendant's

outstanding balance under the parties' September 29, 2022, agreement and wiring the

company defendant $77,745.00).

Elder further avers that annexed as exhibit B to the motion was proof of the

plaintiffs funding of the purchase price. Exhibit B is a one-page document which is

largely redacted. Part of the unredacted text states the following: "In accordance with

your instructions we have DEBITED your account: ********529 on 2023-02-10 for

$77,745.00. If you have any questions please contact your banker."

The plaintiffs motion papers provide no documentary evidence that the company

defendant had another agreement with the plaintiff, that the company defendant owed the

plaintiff $84,321.00 on that prior agreement, or that the company defendant agreed to

have the plaintiff debit $84,321.00 from the purchase price to satisfy the prior debt. The

agreement, annexed as exhibit A to the motion, made no mention of a prior agreement or

2It is apparent to the Court that Elder mistakenly switched the amount purchased with the amount paid. Pursuant to CPLR 2001, the error is disregarded.

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debt between the parties. Nor did the affirmation of plaintiffs counsel. These facts

alone raise material issues of fact regarding the plaintiffs performance under the

agreement. Consequently, the plaintiff cannot make a prima facie showing of entitlement

to judgment on its claim that the company defendant breached the agreement. By not

establishing the company defendant's breach of the agreement, the obligation of the

individual defendant to guarantee the company defendant's performance was not triggered. Inasmuch, as the plaintiff failed to demonstrate that the company defendant or

the individual defendant breached the agreement, this branch of the instant motion is

denied without regard to the sufficiency or lack of opposing papers (see Cugini v System

Lbr. Co., 111 AD2d 114 [1st Dept 1985]). Also; the plaintiffs third cause of action for

attorney fees based on the breach of the agreement and guarantee is also unsupported.

CONCLUSION

The motion by CFG Merchant Solutions, LLC for an order pursuant to CPLR

3212 granting summary judgment on the causes of action in its verified complaint

asserted against defendants Home Media Tech Fl Inc d/b/a Home Media Tech Fl and

Alba Galindo is denied.

The foregoing constitutes the decision and order of this Court.

\ ENTER:

HON. FRANCOi~ A. RIVt:.~

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