Inspiration Enterprises, Inc. v. Inland Credit Corp.

54 A.D.2d 839, 388 N.Y.S.2d 578, 1976 N.Y. App. Div. LEXIS 14593
CourtAppellate Division of the Supreme Court of the State of New York
DecidedNovember 9, 1976
StatusPublished
Cited by17 cases

This text of 54 A.D.2d 839 (Inspiration Enterprises, Inc. v. Inland Credit Corp.) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Inspiration Enterprises, Inc. v. Inland Credit Corp., 54 A.D.2d 839, 388 N.Y.S.2d 578, 1976 N.Y. App. Div. LEXIS 14593 (N.Y. Ct. App. 1976).

Opinion

Oder, Supreme Court, New York County, both entered May 27, 1976, which denied plaintiffs’ motion for an order to remove and consolidate the within captioned Action No. 3, pending in Supreme Court, Suffolk County, with the within captioned Actions Nos. 1 and 2, pending in Supreme Court, New York County; and denied the plaintiffs’ companion motion for an order enjoining the defendants, pendente lite, from maintaining Action No. 3 in Supreme Court, Suffolk County, and which vacated the interim stay granted by order of May 13, 1976, affirmed, with $40 costs and disbursements to respondents. Action No. 1 is based on the alleged fraud of defendants in instituting a foreclosure [840]*840action against the property at 16 East 65th Street, New York County, formerly owned by plaintiff, Inspiration Enterprises, Inc., and seeks 10 million dollars damages and vacatur of the deed to Inland Credit Corp. Action No. 2 is a summary proceeding by Inland, a defendant in Actions Nos. 1 and 3, against Edwina Rager, who is currently in possession of 16 East 65th Street. Edwina Rager is a plaintiff in Actions Nos. 1 and 3. While the complaint in Action No. 3 is virtually identical to the complaint in Action No. 1, and seeks identical relief, it pertains to a foreclosure of Suffolk County real property originally owned by respondent Flowervale, Inc. The foreclosures in New York and Suffolk Counties had no connection with each other except that most of the parties were the same in both actions. A motion to consolidate is directed to the sound discretion of the court, and the court is given wide latitude in the exercise thereof (McAllister v Drislane, 239 App Div 85, 87; see, also, Lawlpr v Sabetti, 48 AD2d 688). The primary purpose of consolidation "is to eliminate technicalities, multiplicities of actions and delays and to protect substantial rights” (Datz v Economy Cotton Goods Stores, 263 NY 252, 254). The denial of the motions appealed from is not an abuse of discretion. Consolidation would adversely affect substantial rights of petitioner-respondent in Action No. 2, a summary proceeding wherein Justice Tyler has ordered an immediate trial. Issue in Action No. 3 has been joined only recently and pretrial procedures are required entailing considerable delay. (See Levin v State of New York, 22 Mise 2d 443, which denied consolidation which would have resulted in delay of a trial.) Further, CPLR 507 provides: "The place of trial of an action in which the judgment demanded would affect the title to, or the possession, use or enjoyment of, real property shall be in the county in which any part of the subject of the action is situated.” While some cases have held CPLR 507 does not preclude trial of an action affecting real property from taking place in a county other than one in which the real property is located (Forde v Forde, 53 AD2d 779; 2 Weinstein-Korn-Miller, NY Civ Prac, par 507.02), the general rule is to the contrary (Nassau Hotel Co. v Barnett, 164 App Div 203; Grace v Deepdale, Inc., 3 AD2d 397; Dair Bldg. Constr. Co. v Mayer, 27 AD2d 535; Winston v Krinsky, 30 AD2d 524). Concur—Birns, Capozzoli, Lane and Nunez, JJ.; Lupiano, J. P., dissents in the following memorandum: On or about the first week of March, 1976, Inland Credit Corporation ("Inland”) commenced a summary holdover proceeding against Edwina Rager in Civil Court, New York County, with respect to real property located at 16 East 65th Street, New York, New York (Action No. 2). This property ("the New York property”) was formerly owned by Inspiration Enterprises, Inc. ("Inspiration”), Inland having acquired title to the realty pursuant to a judgment of foreclosure dated October 28, 1975 in an action entitled Inland Credit Corp. v Inspiration Enterprises (Sup Ct, NY County [Index No. 2166/75]). As a second affirmative defense and counterclaim, Edwina Rager alleged that the said foreclosure action was null and void from inception on the ground of fraud and deceit by the petitioner Inland. Immediately after the initiation of the summary proceeding, Inspiration, Edward Rager and his wife Edwina Rager commenced an action against Inland, Ardisco Financial Corporation ("Ardisco”) and three named individuals in Supreme Court, New York County, alleging causes of action based on fraud in the instituting of the foreclosure action against the New York property and seeking vacatur of the referee’s deed to Inland and monetary damages (Action No. 1). Plaintiffs in Action No. 1 moved for an order consolidating the summary proceeding pending in Civil Court with this Supreme Court action, which motion was granted. Oscar Dane, chair[841]*841man of defendant Inland in Action No. 1, also named as a defendant, notes in his affidavit sworn to on May 6, 1976, that Tyler, J., granted this motion for consolidation on consent with the direction that an order be settled providing for an immediate trial. Defendant Dane unequivocally asserted that "Inland will do its best, pursuant to that decision, to bring that consolidated action for immediate trial.” It should be noted at this point that Edward and Edwina Eager are the sole shareholders and officers of Flowervale, Inc. ("Flowervale”) and Inspiration. Similarly, on or about March 8, 1976, Edward and Edwina Eager and Flowervale commenced an action against Inland and the afore-mentioned three individual defendants and Plantation House & Garden Products, Inc. ("Plantation”) in the Supreme Court, Suffolk County, alleging causes of action based on fraud in the instituting of a foreclosure action against real property in Suffolk County formerly owned by Flowervale and seeking vacatur of the referee’s deed to Plantation and monetary damages (Action No. 3). It is asserted that both Plantation and Ardisco are subsidiaries of and controlled by Inland. It is beyond cavil that the complaints in Actions Nos. 1 and 3 are substantially identical. The fraud alleged in each of the two complaints stems from an identical written agreement purportedly executed by Inland on or about December 6, 1974, affecting both the New York real property and the Suffolk real property. It is asserted, inter alia, that under the terms of that agreement, annexed as an identical exhibit in each action, the defendants fraudulently represented to the plaintiffs that they would not foreclose the second mortgages they held on the New York and Suffolk properties in consideration of plaintiffs deeding the New York property to them; that they would sell the New York property, valued at $460,000, and apply the proceeds to satisfy the mortgages and taxes on said property and would apply the surplus in reduction of the mortgage on the Suffolk property; that notwithstanding these representations, they procured judgments of foreclosure by default against plaintiffs and in obtaining the deed from plaintiffs on the New York property as aforesaid, defendants fraudulently prevented plaintiffs from obtaining refinancing or otherwise defending the foreclosure actions. It is not controverted on this record that the corporate defendants in Actions Nos. 1 and 3 have their offices in New York County. The complaints aver that the corporate plaintiffs have their offices in New York County and Inland in its summary proceeding seeks to oust Edwina Eager from possession of premises in New York County. Noting the defendants consent to consolidation of Actions Nos. 1 and 2, plaintiffs in Action No. 1 moved to have Action No. 3 pending in Suffolk County consolidated with Actions Nos. 1 and 2. Special Term denied their motion citing CPLE 507 and the instant appeal followed.

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Bluebook (online)
54 A.D.2d 839, 388 N.Y.S.2d 578, 1976 N.Y. App. Div. LEXIS 14593, Counsel Stack Legal Research, https://law.counselstack.com/opinion/inspiration-enterprises-inc-v-inland-credit-corp-nyappdiv-1976.