Gouiran Holdings, Inc. v. Miller

140 Misc. 2d 142, 531 N.Y.S.2d 441, 1988 N.Y. Misc. LEXIS 347
CourtNew York Supreme Court
DecidedMay 18, 1988
StatusPublished

This text of 140 Misc. 2d 142 (Gouiran Holdings, Inc. v. Miller) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gouiran Holdings, Inc. v. Miller, 140 Misc. 2d 142, 531 N.Y.S.2d 441, 1988 N.Y. Misc. LEXIS 347 (N.Y. Super. Ct. 1988).

Opinion

OPINION OF THE COURT

Stanley L. Sklar, J.

This case presents the novel issue of whether prohibition is available to bar an administrative agency from considering, at a license revocation hearing, documentary evidence, claimed [143]*143to have been derived from an illegal search and seizure, without affording the licensee an opportunity to test the validity of the search and seizure before the appropriate forum. Since the Administrative Hearing Officer is without jurisdiction to decide the search and seizure issue, and since the exclusionary rule is applicable to administrative proceedings, prohibition lies if the licensee makes a sufficient showing of merit on its suppression motion. Thus, the application to dismiss the petition is denied and respondents are directed to serve an answer.

FACTS

Respondents, the Hearing Officer for the New York State Banking Department and the Superintendent of the New York State Banking Department, allege that in 1987 a confidential investigation was started by the Richmond County District Attorney’s office centered on Emile Gouiran’s unauthorized practice of law and issuance of false financial statements. Gouiran, an attorney admitted solely to the New Jersey Bar, maintained a law office on the second floor of the Gouiran Building, a three-story building located at 386 Forest Avenue, Staten Island. The ground floor was occupied by a mortgage company, GHI, "The Mortgage Money People”. The sole shareholder of GHI is Mr. Gouiran’s mother, Dr. Dema Gouiran. Also located on the first floor of the Gouiran Building is the private office of a chiropractor.

Respondents further allege that during the investigation it appeared that there were violations of the Banking Law and the General Business Law. Accordingly, the District Attorney’s office alerted the Banking Department, and the Real Estate Financing and Securities Bureaus of the Attorney-General’s office. In order to confirm the existence of the violations and also because of a concern that a "substantial likelihood of alteration and/or removal of documents” existed, the District Attorney’s office obtained and executed three search warrants to obtain these documents on February 4, 1988. One warrant was directed to the premises of GHI, another was directed to the person of Emile Gouiran, and the third was directed to the premises of Castle Abstract, Inc., located on the second floor of 392 Forest Avenue, and also to the basement storage area for Castle and GHI. All three warrants indicate that the property to be seized is that which tends to show that Emile Gouiran participated in the unlawful practice of law and issued a false [144]*144financial statement. Petitioner alleges that, despite the narrow scope of the warrants, "nearly every business record” of GHI, Castle and the law office was seized.

On the same day, the Banking Department served upon GHI an order suspending GHI’s mortgage banking license for 30 days, pursuant to Banking Law § 595 (2),1 on the grounds that Emile Gouiran has been "heavily involved” in the operation of GHI which was licensed on the condition that he not be involved in any manner in such operation and that "Emile Gouiran, operating through GHI has been and is engaging in activities which are illegal under the Banking Law.”

On March 8, 1988, the Banking Department served GHI with a notice of hearing and statement of charges and scheduled a license revocation hearing for March 30, 1988. The hearing commenced in the afternoon of March 30, 1988. At that time GHI moved for a stay of the proceeding before the Hearing Officer on the grounds that the notice of charges was inadequate in certain respects, and that items sought to be introduced by the Banking Department were the product of an illegal search and seizure. With respect to this latter claim, GHI stated that, since the warrants authorized the search for evidence of only two misdemeanors, namely, Emile Gouiran’s unlawful practice of law and his filing of false financial statements, the seizure of nearly every business record and document from GHI’s premises, almost none of which, it is claimed, had anything to do with the two alleged misdemeanors, was overbroad and, therefore, unlawful. In addition, it is claimed that the prospective testimony of witnesses who were listed in the Banking Department’s response to GHI’s discovery request will be derived in large part from the illegally seized records. GHI urged that, since the exclusionary rule applies to administrative proceedings and, since the administrative agency lacks jurisdiction to pass on the legality of the search (Matter of Finn’s Liq. Shop v State Liq. Auth., 24 NY2d 647, cert denied 396 US 840), the proceeding must be stayed to permit the Supreme Court to consider GHI’s suppression application. The Hearing Officer denied the stay while agreeing, however, that he had no authority to determine the suppression issue (see, Matter of Finn’s Liq. Shop v State Liq. Auth., supra, at 660), and thereby indicated, in effect, that he was going to proceed with the hearing as [145]*145though the exclusionary rule did not apply. GHI then filed the instant proceeding.

DISCUSSION

GHI’s instant application seeks to bar the respondents, the Hearing Examiner and the Superintendent of the Banking Department, from proceeding with all administrative proceedings by the Banking Department including the license revocation hearing, until this court can render a decision on the merits of GHI’s application for suppression of evidence derived from the allegedly illegal search and seizure. Respondents did not serve an answer but instead cross-moved to dismiss (CPLR 7804 [f]), raising several threshold issues. They urge that this application cannot be made before this court but rather must be made in Richmond County. Citing CPL 710.50 (1) (a), they argue that a suppression motion must be made in the Supreme Court of the county in which an indictment is pending, "or if the defendant has been held by a local criminal court for the action of a grand jury * * * in the superior court * * * which impaneled or will impanel such grand jury”.

CPL 710.50 is inapplicable. It is clear that it refers to a suppression motion made in the context of a criminal action. (See, CPL 710.40 [1] ["A motion to suppress evidence must be made after the commencement of the criminal action in which such evidence is allegedly about to be offered”].) Further, this is not a case in which "the defendant has been held by a local criminal court for the action of a grand jury”, nor is an indictment pending. (CPL 710.50 [1] [a].) While it is true that a Grand Jury has been impaneled in this matter, it is undisclosed who the targets are, and uncertain whether any indictments will be handed down.2

[146]*146One threshold issue remains. During oral argument of this application, which was characterized as an application for a preliminary injunction, on April 8, 1988,1 expressed a concern with the adequacy of petitioner’s papers in that the assertion of the overbreadth of the execution of the warrants appeared conclusory and also because GHI seemed to be seeking suppression of documents seized from Castle and Emile Gouiran, thereby casting doubt on its standing to suppress. Because petitioner then assured the court that, if given the opportunity, it could make an adequate showing of merit the court adjourned the matter to allow petitioner to supplement its papers.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Mapp v. Ohio
367 U.S. 643 (Supreme Court, 1961)
MATTER OF KELLOG v. Supreme Court, County of Queens
273 N.E.2d 137 (New York Court of Appeals, 1971)
Watergate II Apartments v. Buffalo Sewer Authority
385 N.E.2d 560 (New York Court of Appeals, 1978)
B. T. Productions, Inc. v. Barr
376 N.E.2d 171 (New York Court of Appeals, 1978)
Lee v. County Ct. of Erie County
267 N.E.2d 452 (New York Court of Appeals, 1971)
Matter of Culver Contrg. Corp. v. Humphrey
196 N.E. 627 (New York Court of Appeals, 1935)
Kraemer v. County Court
160 N.E.2d 633 (New York Court of Appeals, 1959)
Finn's Liquor Shop, Inc. v. State Liquor Authority
249 N.E.2d 440 (New York Court of Appeals, 1969)
Blake v. Hogan
250 N.E.2d 568 (New York Court of Appeals, 1969)
Proskin v. County Court of Albany County
280 N.E.2d 875 (New York Court of Appeals, 1972)
In re the Claim of Fisher
325 N.E.2d 151 (New York Court of Appeals, 1975)
Nigrone v. Murtagh
330 N.E.2d 45 (New York Court of Appeals, 1975)
La Rocca v. Lane
338 N.E.2d 606 (New York Court of Appeals, 1975)
People ex rel. Piccarillo v. New York State Board of Parole
397 N.E.2d 354 (New York Court of Appeals, 1979)
Rush v. Mordue
502 N.E.2d 170 (New York Court of Appeals, 1986)
Doe v. Axelrod
522 N.E.2d 444 (New York Court of Appeals, 1988)
Holtzman v. Goldman
523 N.E.2d 297 (New York Court of Appeals, 1988)
Clark v. Flynn
9 A.D.2d 249 (Appellate Division of the Supreme Court of New York, 1959)
Walston & Co. v. New York City Commission on Human Rights
41 A.D.2d 238 (Appellate Division of the Supreme Court of New York, 1973)
Carey v. Kitson
93 A.D.2d 50 (Appellate Division of the Supreme Court of New York, 1983)

Cite This Page — Counsel Stack

Bluebook (online)
140 Misc. 2d 142, 531 N.Y.S.2d 441, 1988 N.Y. Misc. LEXIS 347, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gouiran-holdings-inc-v-miller-nysupct-1988.