First Sovereign Equity Group, Inc. v. Town of Smithtown

Opinion

First Sovereign Equity Group, Inc. v Town of Smithtown

2026 NY Slip Op 04928

August 12, 2026

Appellate Division, Second Department

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This decision is uncorrected and subject to revision before publication in the Official Reports.

First Sovereign Equity Group, Inc., respondent,

v

Town of Smithtown, appellant, et al., defendant.

Supreme Court of the State of New York, Appellate Division, Second Judicial Department

Decided on August 12, 2026

2024-09867, (Index No. 614777/19)

Francesca E. Connolly, J.P.

Barry E. Warhit

Helen Voutsinas

Donna-Marie E. Golia, JJ.

Campolo, Middleton & McCormick, LLP, Ronkonkoma, NY (Richard A. DeMaio of counsel), for appellant.

Campanelli & Associates, P.C., Merrick, NY (Jean M. Smyth of counsel), for respondent.

[*1]

DECISION & ORDER

In an action, inter alia, to recover damages for a violation of the plaintiff's procedural due process rights pursuant to 42 USC § 1983, the defendant Town of Smithtown appeals from an order of the Supreme Court, Suffolk County (Frank A. Tinari, J.), dated May 21, 2024. The order, insofar as appealed from, denied that branch of that defendant's motion which was for summary judgment dismissing the cause of action to recover damages for a violation of the plaintiff's procedural due process rights pursuant to 42 USC § 1983 insofar as asserted against it.

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, and that branch of the motion of the defendant Town of Smithtown which was for summary judgment dismissing the cause of action to recover damages for a violation of the plaintiff's procedural due process rights pursuant to 42 USC § 1983 insofar as asserted against it is granted.

In 2016, the plaintiff's predecessor in interest, Dermot Parsley, was issued two summonses returnable in the District Court, Fourth District, for failing to maintain the property located at 427 Lake Avenue South in Nesconset (hereinafter the property). Following a fire at the property in 2017, at the direction of the defendant Town of Smithtown, a private company performed work to secure the house and charged the cost of that work to the Town. Thereafter, the Town commenced an unsafe building proceeding against Parsley through the Smithtown Town Board (hereinafter the Town Board). After a hearing on the matter, the Town Board adopted a resolution dated June 22, 2017, declaring the property in violation of section 112-25(A) of the Code of the Town of Smithtown, determining that Parsley failed to remediate unsafe conditions on the property after notice of the same, and authorizing the Town to remove or remediate the unsafe conditions. Although the Town provided Parsley with notice of the hearing, he did not appear. The Town Board adopted another resolution, dated October 10, 2017, inter alia, accepting the bid of the defendant Watral Brothers, Inc. (hereinafter Watral), to demolish the "[u]nsafe [s]tructures" on the property. Watral began working on the property by, among other things, clearing debris and asbestos until December 2017.

In January 2018, a referee appointed in an action to foreclose a mortgage commenced against Parsley, among others, conveyed the property to the plaintiff by referee's deed. The Town [*2]agreed to allow the plaintiff to remediate the violations on the property and to forego demolition of the house on the property. Thereafter, the Town requested that the plaintiff pay Watral's invoice in the amount of $23,436 for the work Watral performed on the property in 2017. When the plaintiff refused to pay the invoice, the Town paid Watral directly and levied a special assessment in the amount of $24,731 on the property's real property taxes for the period from December 2018 to November 2019. After the special assessment became a lien on the property, the plaintiff paid it.

In March 2020, the plaintiff commenced this action against, among others, the Town, inter alia, to recover damages for a violation of the plaintiff's procedural due process rights pursuant to 42 USC § 1983. In November 2023, the Town moved, among other things, for summary judgment dismissing the cause of action to recover damages for a violation of the plaintiff's procedural due process rights pursuant to 42 USC § 1983 insofar as asserted against it. The plaintiff opposed the motion. In an order dated May 21, 2024, the Supreme Court, inter alia, denied that branch of the Town's motion. The Town appeals.

To the extent the plaintiff's cause of action to recover damages under 42 USC § 1983 is premised on an alleged violation of Parsley's due process rights, the plaintiff does not have standing to maintain that cause of action, even if it sustained economic damages as a result (see Pirro v Board of Trustees of the Vil. of Groton, 203 AD3d 1263, 1266-1267).

"Procedural due process imposes constraints on governmental decisions which deprive individuals of 'liberty' or 'property' interests within the meaning of the Due Process Clause of the Fifth or Fourteenth Amendment" (Mathews v Eldridge, 424 US 319, 332; see Matter of Santomero v Town of Bedford, 204 AD3d 925, 927). "'Due process is flexible and calls for such procedural protections as the particular situation demands'" (People ex rel. Neville v Toulon, 43 NY3d 1, 9 [internal quotation marks omitted], quoting Mathews v Eldridge, 424 US at 334; see Hetelekides v County of Ontario, 39 NY3d 222, 236). In determining what due process requires in a specific context, courts consider "(1) the private interest that will be affected by the official action; (2) the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and (3) the government's interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail" (Matter of State of New York v Ted B., 132 AD3d 28, 34-35; see Mathews v Eldridge, 424 US at 335).

Here, although the plaintiff's property interest was affected by the special assessment and lien, the risk of erroneous deprivation was remedied by the availability of a proceeding pursuant to CPLR article 78 (see Noroian v City of Port Jervis, 16 AD3d 392, 393). Accordingly, the Town demonstrated, prima facie, that it did not deprive the plaintiff of due process (see Matter of Harbourview Realty, LLC v Village of Roslyn, 242 AD3d 749, 751; Matter of Sumkin v Town of Babylon, 238 AD2d 430, 430). In opposition, the plaintiff failed to raise a triable issue of fact.

Accordingly, the Supreme Court should have granted that branch of the Town's motion which was for summary judgment dismissing the cause of action to recover damages for a violation of the plaintiff's procedural due process rights pursuant to 42 USC § 1983 insofar as asserted against it.

The plaintiff's remaining contentions either are without merit or need not be reached in light of the foregoing.

CONNOLLY, J.P., WARHIT, VOUTSINAS and GOLIA, JJ., concur.

ENTER:

Darrell M. Joseph

Clerk of the Court