BOZEWICZ v. Richard Goldberg, Nonparty-Respondent. (2001)

In an action to foreclose a mortgage, the defendants Nash Metal Ware Co., Inc., and Stephanie Eisenberg appeal from an order of the Supreme Court, Kings County (Barasch, J.), dated October 22, 1999, which granted, without a hearing, the motion of the temporary receiver, Richard Goldberg, inter alia, to approve his account and fix his commission.

ORDERED that the order is reversed, on the law, with costs, and the matter is remitted to the Supreme Court, Kings County, for a hearing in accordance herewith.

In this action to foreclose a mortgage, the Supreme Court granted the motion of the temporary receiver, inter alia, to approve his account and fix his commission.   In granting the motion, the court approved, nunc pro tunc, the temporary receiver's retention of counsel and a managing agent, and the payments made to each.   The appellants contend that, in light of the factual issues raised, the court erred in granting the temporary receiver's motion without a hearing.   We agree.

In opposition to the temporary receiver's motion, the appellants raised issues of fact as to the accounting and commission.   The issues included, inter alia, whether the temporary receiver sought a commission on rents he received after he was discharged (see, Key Bank of N.Y. v. Anton, 241 A.D.2d 482, 659 N.Y.S.2d 895) and the propriety and amount of various expenses claimed, including those of the managing agent (see, Litho Fund Equities v. Alley Spring Apts. Corp., 94 A.D.2d 13, 462 N.Y.S.2d 907;  East Chatham Corp. v. Iacovone, 26 A.D.2d 433, 275 N.Y.S.2d 53).   Further, although the court may authorize the retention of counsel by a temporary receiver, nunc pro tunc, and the payment of an attorney's fee, the appellants raised factual issues as to the necessity and reasonableness of the fee, including, inter alia, whether counsel performed duties that are customarily performed, and should have been performed, by the temporary receiver (see, Sun Beam Enters. v. Liza Realty Corp., 210 A.D.2d 153, 621 N.Y.S.2d 9;  Kraizberg v. Frank, 170 A.D.2d 306, 565 N.Y.S.2d 817;  Long Is. City Sav. & Loan Assn. v. Bertsman Bldg. Corp., 123 A.D.2d 840, 507 N.Y.S.2d 640;  Strober v. Warren Prop. Co., 84 A.D.2d 834, 444 N.Y.S.2d 475;  Lentine v. Fundaro, 56 A.D.2d 592, 391 N.Y.S.2d 649).   Accordingly, the Supreme Court should not have granted the temporary receiver's motion without a hearing.