USA v. THOMAS GORMAN BERNARD FRIFFIN THOMAS FOGARTY JOHN DOE NO JOHN DOE NO JANE DOE NO JANE DOE NO (2026)

The following papers, numbered 1, were read and considered in connection with Plaintiff's Notice of Motion (Motion Seq. No. 2) for an Order (a) pursuant to Civil Practice Law and Rules § 3215, granting a money default judgment in favor of Plaintiff DOKA USA. LTD against Defendants HIGHBURY CONCRETE INC., THOMAS GORMAN, BERNARD GRIFFIN and THOMAS FOGARTY, in the sum of $933,083.40 plus per diem interest at the rate of $305.14 though the satisfaction of judgment, together with costs, disbursements, attorney's fees, and pre and post judgment interest, (b) for such other and further relief as this Court deems just and proper:

PAPERS NUMBERED

Notice of Motion (Motion Seq. No. 2)/Affirmation of Eran D. Grossman, Esq./ Affirmation of John Dimicco/Memorandum of Law in Support/Affidavit of Service/Exhibits A-M 1

Upon the foregoing papers, the Court now rules as follows:

PROCEDURAL HISTORY

Plaintiff brought this action against Defendants seeking to recover damages as a result of Defendants' breach of agreements with Plaintiff to provide equipment, materials and services related to the following construction projects: (1) 23-03 44th Road, Long Island City, New York 11101, (2) 520 Fifth Avenue, New York, New York 10036, (3) 180 Ashland Avenue, Brooklyn, New York 11217, and (4) 480 Kent Avenue, Brooklyn, New York 11249 (hereinafter the "construction projects"). Plaintiff commenced the instant action on January 19, 2026, by the filing of a Summons and Complaint. See NYSCEF Doc. Nos. 1-2.

Defendant HIGHBURY CONCRETE, Inc. (hereinafter HIGHBURY) was served pursuant to Business Corporation Law § 306 on January 22, 2026, by service on the New York State Secretary of State. See NYSCEF Doc. No. 3. Defendant THOMAS GORMAN (hereinafter GORMAN) was served pursuant to Civil Practice Law and Rules § 308(2) on January 22, 2026, by service on Laura Gorman, GORMAN's wife, at 91 Sickletown Road, Orangeburg, New York. See NYSCEF Doc. No. 4.

Defendant BERNARD GRIFFIN (hereinafter GRIFFIN) was served pursuant to Civil Practice Law and Rules § 308(2) on January 21, 2026, by service on Minerva Griffin, GRIFFIN's wife, at 1 Dutch Court, West Nyack, New York. See NYSCEF Doc. No. 5.

Defendant THOMAS FOGARTY (hereinafter FOGARTY) was served pursuant to Civil Practice Law and Rules § 308(2) on January 21, 2026, by service on Laura Marino, at 4 Theis Lane, Blauvelt, New York. See NYSCEF Doc. No. 6.

Despite service, Defendants failed to appear, answer or move for an extension of time to answer. Further, Plaintiffs contend that the Summons and Verified Complaint were mailed to all of the defaulting Defendants pursuant to Civil Practice Law and Rules § 3215(g). See NYSCEF Doc. No. 22.

On March 9, 2026 Plaintiff filed a motion for default judgment (Motion Seq. No. 1). See NYSCEF Doc. No. 7-16. On April 29, 2026, the undersigned denied Plaintiff's motion with leave to refile based upon the failure of Plaintiffs to include copies of the underlying contracts between Plaintiff and Defendants. See NYSCEF Doc. No. 19. On June 1, 2026, the Plaintiff filed the instant motion for default judgment (Motion Seq. No. 2). See NYSCEF Doc. No. 21-38.

FACTS

Plaintiff contends that they supplied Defendants with concrete formwork, materials, equipment and services for rental use for construction projects (hereinafter "the Projects") located at (1) 23-03 44th Road, Long Island City, New York, (2) 520 Fifth Avenue, New York, New York, (3) 180 Ashland Place, Brooklyn, New York and (4) 480 Kent Avenue, Brooklyn, New York. See NYSCEF Doc. No. 24, ¶ 4.

Plaintiff alleges that Defendants GORMAN, GRIFFIN and FOGARTY are executives, officers, directors and/or shareholders of Defendant HIGHBURY and, in their roles, had control over receipt of payments for the Projects. See NYSCEF Doc. No. 24, ¶ 6. According to Plaintiff, despite demand for payment, Defendant HIGHBURY has failed to pay Plaintiff a total of

$906,083.40 with accrued interest. See NYSCEF Doc. No. 24, ¶ 9.

ARGUMENTS

Plaintiff contends that they are entitled to relief pursuant to Civil Practice Law and Rules § 3215(a) since they have submitted proof of the facts constituting their claim and proof that the Defendants were all properly served and failed to appear.

First, Plaintiff argues that a process server's affidavit has been provided demonstrating service on each of the Defendants, as natural persons, pursuant to Civil Practice Law and Rules § 308 and, despite service, none of the individual Defendants have answered, appeared or sought an extension to answer. Further, Plaintiff asserts that Defendant HIGHBURY, the corporate defendant, was properly served pursuant to Civil Practice Law and Rules § 311 and Business Corporation Law § 306. Additionally, Plaintiff argues that, in compliance with Civil Practice Law and Rules § 3215(g), a default notice letter along with a copy of the Summons and Complaint were mailed to each of the defaulting Defendants and despite the mailing -- none of the Defendants have cured the default.

Next, as proof of the facts constituting the claim, the Plaintiff contends the basis of their claim is sufficiently demonstrated by the verified complaint, supporting affirmation and annexeddocuments, pursuant to Civil Practice Law and Rules § 3215.

Breach of Contract Claim

According to Plaintiff, they have alleged in the Verified Complaint all of the elements of a breach of contract: (1) performance by Plaintiff; (2) Defendant's breach of the agreement; and (3) resulting damages. Specifically, Plaintiff contends that the Verified Complaint alleges that Plaintiff entered into agreements with Defendant HIGHBURY to supply concrete formwork, materials, equipment and services for rental use on the aforementioned construction projects. The Plaintiff also asserts, in further support of the verified complaint, that they have submitted the affirmation of John Dimicco, Plaintiff's Northeast Manager. See NYSCEF Doc. No. 23.

According to Plaintiff, they agreed to supply equipment and materials to Defendant HIGHBURY in exchange for payment of monthly invoices at an agreed-upon rental rate and the list price value of the equipment. Plaintiff contends that they completed performance and furnished the concrete forms and related materials as required by the contracts. Defendant HIGHBURY received payment for the construction projects and subsequently used the funds for purposes other than paying Plaintiff. Further, Plaintiff contends that they submitted proof that they attempted to locate the money that they are owed through a demand pursuant to Lien Law § 76 but received no response from Defendants. Nonetheless, and despite demand for payment, the Plaintiff asserts that the Defendants have failed to pay the Plaintiff the following amounts for rental and use of the equipment furnished pursuant to the contract: (1) $270,927.99 plus accruing interest, costs, and attorney's fees for the 44th Road Project, (2) $297,826.34 plus accruing interest, costs, and attorney's fees for the 520 Fifth Avenue Project, (3) $52,851.04 plus accruing interest, costs, and attorney's fees related to the 180 Ashland Project, and $106,450.67 plus accruing interest, costs, and attorney's fees related to the Kent Avenue Project. Plaintiff alleges that the total damages owed to them by Defendants is $906,083.40 with accrued interest, plus attorneys' fees and pre and post judgment interest.

In support of the instant application, the Plaintiff has included four documents e-filed with the title "[c]ontract" referencing each of the project locations. The document e-filed as "[c]ontract 44th Road" is dated January 12, 2023 and issued on Plaintiff's letterhead. It indicates that the customer is Defendant HIGHBURY and is addressed to the attention of Kevin Hannigan. It purports to contain Hannigan's signature and is dated May 3, 2023 with his title: "Project Manager." See NYSCEF Doc. No. 32.

The document e-filed as "[c]ontract 520 5th Ave" is dated April 4, 2024 and issued on Plaintiff's letterhead. It indicates that the customer is Defendant HIGHBURY and is addressed to the attention of Liam Collins. It contains Collins' signature and is dated April 11, 2024, on the bottom of the first page with his title: "Head of Operations." See NYSCEF Doc. No. 33.

The document e-filed as undated "[c]ontract 180 Ashland" and issued on Plaintiff's letterhead, indicates the customer is Defendant HIGHBURY. It is addressed to the attention of James Walsh, and contains Walsh's signature dated June 20, 2023, on the bottom of the first page with his title "PM."

The document e-filed as "[c]ontract Kent Ave" is dated June 1, 2023 and issued on Plaintiff's letterhead. It indicates that the customer is Defendant HIGHBURY, and is addressed to the attention of James Walsh, and contains Walsh's signature dated July 7, 2023 on the bottom of the first page with his title "Project Manager."

Based upon the aforementioned contracts, Defendant HIGHBURY agreed to the contract terms, which include but are not limited to -- payment for the rented equipment, payment being due and payable within thirty (30) days of the invoice date, imposition of a service charge per month on unpaid balances, liability of the customer for freight costs, and the payment of attorneys' fees to enforce compliance with the terms and conditions of the contracts.

Plaintiff alleges that they complied with their responsibilities under the contract for each of the four (4) projects and that Defendant HIGHBURY has received payment from the aforementioned project owners but has diverted the funds received for purposes other than payment of monies owed to Plaintiff. Further, Plaintiff contends that they made a demand for a verified statement pursuant to Lien Law § 76 as to the projects and received no response from the Defendants. Based upon Defendants' failure to respond, the Plaintiff asserts there is a legal presumption that the aforementioned funds received by Defendants have been diverted by Defendants in violation of Lien Law.

As to the breach of contract, Plaintiff avers that Defendant HIGHBURY failed to make monthly rental payments for equipment, failed to make payments for purchased equipment, failed to pay for equipment that was destroyed by Defendants while in use and failed to pay the agreed upon value of rental equipment that was not returned. According to the Dimicco Affirmation, the amounts owed have been delineated by Plaintiff in their attached Receivables Aging List and the interest owed demonstrated by an interest calculation chart. In addition, the Dimicco Affirmation states that Plaintiff has incurred attorney's fees "in excess of $27,000" while seeking to enforce Defendant's payment obligation and that Plaintiff is entitled to those fees based upon the terms of the contracts.

Quantum Meruit Claim

Plaintiff also contends that they have demonstrated the cause of action for quantum meruit, which was plead in the alternative. Plaintiff asserts that the cause of action for quantum meruit can be plead simultaneously with the breach of contract cause of action and that they have adequately alleged that unpaid materials and services were provided to Defendants without payment being received.

Unjust Enrichment Claim

Similarly, Plaintiff asserts that they have alleged that the Defendants were unjustly enriched. The Verified Complaint alleges that the Defendants were enriched at the Plaintiff's expense when they received concrete formwork and related materials and services but failed to pay the Plaintiffs.

Account Stated Claim

Plaintiff argues that they have sufficiently pleaded all of the elements for recovery under a theory of account stated. The Verified Complaint alleges that Plaintiff sent Defendants billing statements for work that was performed for Defendants and despite the demand for payment, the Defendants have failed to make full payment to Plaintiff.

Violation of Prompt Payment Act Claim

Plaintiff argues that the purpose of Article 35-E of General Business Law, known as the Prompt Payment Act, is to protect subcontractors against late or non-paying contracts and to expedite the payment of monies owed to those who have been contracted for services. According to Plaintiff, this Act applies to written or oral contracts that relate to real property located in New York with a total cost of construction exceeding $150,000.

Plaintiff asserts that the Prompt Payment Act is applicable to this action because there is no dispute that the materials, equipment and labor were provided by Plaintiff for the improvement of real property in New York and the value of the materials, equipment and labor exceeds $150,000. Further, Plaintiff contends that the Defendants failed to approve or disapprove some and/or all of the invoices sent to them for the contracted work within twelve (12) business days of receipt and therefore are liable for the amounts set forth in the invoices. Also, Plaintiff asserts that if the contractor receives funds, they are required to provide the subcontractor with their proportionate amount within seven (7) days of receipt of the monies. Plaintiff, through the Dimicco Affirmation, argues that the Defendants received the invoices for the four (4) projects and failed to dispute or object to the invoices. In addition, the invoices are over thirty (30) days old. Thus, under the Prompt Payment Act, the Defendant is liable to Plaintiff for the monies owed under the contracts plus accrued interest.

Article 3-A Lien Law Claims

Plaintiff contends that they have timely pled trust claims for a violation of Article 3-A of the Lien Law in that Defendant HIGHBURY, as the contractor of the Projects, and Defendants GORMAN, GRIFFIN and FOGARTY, as executives and principals of HIGHBURY, are trustees of trust funds and since the Defendants received payment in relation to Plaintiff's work on all of the Projects.

Plaintiff also asserts that. "[u]pon information and belief," Defendants GORMAN, GRIFFIN and FOGARTY diverted trust fund assets they received and that were paid to Defendants for the benefit of Plaintiff. Further, according to Plaintiff, they demanded Verified Statements of Trust as to each of the Projects from Defendants and received no response. In their view, that failure is presumptive evidence that the Defendants have misappropriated the trust funds. As a result, Plaintiff alleges they are entitled to a judgment as to all of the Projects in the amount of $906,083.40 plus attorney's fees and per diem interest.

Replevin Claims

Plaintiff argues that claims sounding in replevin are brought to recover personal property that was wrongfully taken or withheld from them by Defendants as to the subject Projects. The Plaintiff asserts that it is undisputed by the annexed contracts that they provided the Defendants with concrete formwork for rental use for the Projects and that the Defendants are currently in possession of those concrete formworks. In addition, Plaintiff avers they have demanded the return of the concrete formworks and the Defendants have refused to return the property and there is no proof that anyone other than Plaintiff has asserted a right to the subject concrete formworks. As a result, Plaintiff contends since they are the rightful owners of the concrete formworks they provided to Defendants they must be returned as a demand for same has been made.

Conversion Claims

Finally, Plaintiff contends that they provided Defendants with concrete formwork as to the Projects, which were owned by Plaintiff and rented by Defendants. They allege that the Defendants remain in possession of the formworks -- interfering with Plaintiff's right of possession. In addition, Plaintiff asserts that they demanded return of the concrete formworks and Defendants refused to return same, resulting in a conversion.

LAW/ANALYSIS

In order to enter a default judgment pursuant to Civil Practice Law and Rules § 3215, upon a defendant's failure to appear, a plaintiff must submit the "requisite proof" which includes affidavits setting forth the basis of the claim and the facts of the default, that an additional mailing has been made, an affidavit of military investigation, the pleadings, and an affidavit of service. See Civil Practice Law and Rules § 3215(f); See also Rosenzwerig v. Gubner, 194 AD3d 1086 [2d Dept 2021]. "Given that in default proceedings the defendant has failed to appear, and the plaintiff does not have the benefit of discovery, the affidavit or verified complaint need only allege enough facts to enable a court to determine that a viable cause of action exists." Woodson v. Mendon Leasing Corp, 100 NY2d 62, 70-71 [2003]. "Where a verified complaint has been served, it may be used as the affidavit of the facts constituting the claim and the amount due; in such case, an affidavit as to the default shall be made by the party or the party's attorney." Civil Practice Law and Rules § 3215(f); See also Woodson v. Mendon Leasing Corp., 100 NY2d at 70.

In this action, counsel filed an attorney affirmation, copies of the affidavits of service for all Defendants, an affirmation of mailing pursuant to Civil Practice Law and Rules § 3215, the Verified Complaint pursuant to § 3215(f) in lieu of an affidavit of facts constituting the claim, the Default Notice sent to all Defendants pursuant to § 3215(g)(3)(i) and to Defendant HIGHBURY pursuant to § 3215(g)(4)(i), copies of the four (4) contracts, a demand letter dated July 16, 2025, a receivables aging list, and an interest calculation.

Here, the Plaintiff initiated proceedings in March 2026 for entry of a judgment, which was within one year of Defendant's default in the action. As such, the instant application is timely. The Plaintiff e-filed an attorney affirmation, the affidavit of services as to Defendants indicating the Defendants were properly served, and a Memorandum of Law.

First, Seventh, Thirteenth, and Nineteenth Causes of Action — Breach of Contract

"[T]o plead a cause of action for breach of contract; a plaintiff must allege that: (1) a contract exists; (2) plaintiff performed in accordance with the contract; (3) defendant breached its contractual obligations and (4) defendant's breach resulted in damages." 34-06 73, LLC v Seneca Insurance Company, 39 NY3d 44, 52 [2022] (internal citations omitted). Further, "[i]n order to state a cause of action to recover damages for a breach of contract, the plaintiff's allegations must identify the provisions of the contract that were breached." Barker v Time Warner Cable, Inc., 83 AD3d 750, 751 [2d Dept 2011].

The Plaintiff's prior motion for default judgment was denied as the Verified Complaint relied upon by Plaintiff in support of their motion did not include a copy of the four (4) construction contracts. Now, upon the refiling of the motion for default judgment, the Plaintiff has provided the four (4) contracts entered into between themselves and Defendant HIGHBURY for each individual construction project. See NYSCEF Doc. Nos. 32, 33, 34 and 35.

Here, Plaintiff has demonstrated through the Dimicco Affirmation that they performed their obligations under the terms of each of the construction contracts for the 44th Road Project, the Ashland Place Project and the Kent Avenue Project in which they furnished equipment and services as agreed upon with Defendant HIGHBURY and are owed $347,982.72 plus per diem interest, $66,600.44 plus per diem interest, and $143,632.43 plus per diem interest plus. The Court notes that Plaintiff has additionally submitted the contract for the 520 Fifth Avenue Project, but that contract is missing the Terms and Conditions section, which provides for the Plaintiff's basis for enforcement of the contract.

Plaintiff, in a footnote, acknowledged this deficiency and seeks the Court to disregard this deficiency. The Court finds that the contract for the 520 Fifth Avenue Project cannot be relied upon for a default judgment based upon Plaintiff's own admission that the contract submitted as to 520 Fifth Avenue is incomplete and they have provided no explanation as to the whereabouts of the missing portion. Therefore, default judgment as to the breach of contract claim for the 520 Fifth Avenue Project is denied.

Plaintiff has demonstrated that the Defendant breached their contractual obligations as to the three (3) contracts in that they demonstrate Defendant HIGHBURY has failed to pay Plaintiff for rented and purchased equipment, failed to pay for equipment that was damaged during Defendant HIGHBURY's use, failed to pay charges of repairing or reconditioning of damaged equipment and failed to pay the value of rented equipment that was not returned. Further, the Dimicco Affirmation, the receivables aging list, and the interest calculation also demonstrate that as a result of Defendant HIGHBURY's breach on the three (3) construction contracts -- Plaintiff has been damaged in the amount of $558,223.40.¹ Based upon the foregoing, Plaintiff's motion for default judgment regarding the three (3) separate construction contracts as to Defendant HIGHBURY is granted.

Second, Eighth, Fourteenth, and Twentieth Causes of Action - Prompt Payment Act

The purpose of the Prompt Payment Act was "to expedite payment of all monies owed to those who perform contracting services pursuant to construction contracts." General Business Law § 756-a. The statute provides that "performance by a subcontractor in accordance with the provisions of its contract shall entitle it to payment from the party with which it contracts." General Business Law § 756-a(3)(b)(i). Further, the statute delineates a specific procedure for submission and payment of invoices issued based upon construction contracts and provides remedies for non-compliance with that procedure. See General Business Law § 756-a. For example, pursuant to § 756-a(2)(a)(ii) once a contractor receives an invoice they must either "approve or disapprove" the invoice within twelve (12) business days and absent a timely objection to the amount of the invoice, the contractor is required to pay the subcontractor interest on the amount due at the rate of one percent (1%) per month commencing the day after the payment was due. See General Business Law §§ 756-a(3)(b)(i) and 756-b(1)(b).

Here, the Plaintiff has failed to establish Defendant HIGHBURY's violation of the Prompt Payment Act. Plaintiff has demonstrated that they performed the work that they contracted to do with Defendant HIGHBURY and that the amounts due went unpaid as to the four (4) contracts, but Plaintiff failed to provide any documentary evidence that they issued invoices to Defendant HIGHBURY or that Defendant HIGHBURY did not object to the invoices as to the contracts. In addition, the Demicco Affirmation solely provides a delineation of the terms of the four (4) contracts which require the issuance of monthly invoices, and payment of invoices thirty (30) days from the invoice date. Plaintiff's submission fails to demonstrate the dates when Defendant HIGHBURY was provided with the contractually agreed upon invoices or demonstrate that the Defendant failed to approve or disapprove of the invoices within twelve (12) dates from receipt. Based upon the insufficiency of the documentation the Court denies Plaintiff's application for default judgment as to the second, eighth, fourteenth, and twentieth causes of action as to Defendant HIGHBURY.

Third, Ninth, Fifteenth, and Twenty-First Causes of Action - Quantum Meruit Fourth, Tenth, Sixteenth, and Twenty- Second Causes of Action - Unjust Enrichment

To recover based upon a cause of action pursuant to quantum meruit the movant must provide evidence of "(1) the performance of services in good faith, (2) the acceptance of the services by the person to whom they are rendered, (3) an expectation of compensation therefor, and (4) the reasonable value of the services allegedly rendered." Stephan B. Gleich & Associates v Gritsipis, 87 AD3d 216, 222-223 [2d Dept 2011]; See also AHA Sales, Inc. v Creative Bath Products, Inc., 58 AD3d 6 [2d Dept 2008].

"To state a cause of action to recover damages for unjust enrichment, a plaintiff must alleged that '(1) the other party was enriched, (2) at that party's expense and (3) that 'it is against equity and good conscience to permit [the other party] to retain what is sought to be recovered.' " AHA Sales, Inc. v Creative Bath Products, Inc., 58 AD3d at 19 quoting Cruz v McAneney, 31 AD3d 54, 59 [2d Dept 2006] (internal citations omitted).

Further, the theories of quantum meruit and unjust enrichment are equitable in nature and are only applicable where there is no valid and enforceable contract between the parties that addresses the dispute. See Stephan B. Gleich & Associates v Gritsipis, 87 AD3d at 223; see also AHA Sales, Inc. v Creative Bath Products, Inc., 58 AD3d at 20. Rather, a plaintiff can proceed under a theory of breach of contract and quasi-contract theories, such as quantum meruit and unjust enrichment, when there is a "bona fide dispute as to the existence of a contract, or where the contract does not cover the dispute in issue. See id at 20. Here, the Plaintiff alleges the existence of a written contract between the parties as to all four (4) construction projects and has failed to allege the existence of a dispute as to any of the four (4) contracts or that the annexed contracts do not cover the subject of the instant dispute. Therefore, Plaintiff has failed to submit requisite proof of their quantum meruit and unjust enrichment claims and as such default judgment is denied as to all of the causes of action sounding in quantum meruit and unjust enrichment.

Fifth, Eleventh, Seventeenth, and Twenty-Third Causes of Action - Account Stated

"An account stated is an agreement between parties as to an account and the correctness of account items and a specific balance due on them." White Plains Cleaning Services, Inc v 901 Properties, Inc., 94 AD3d 1108, 1109 [2d Dept 2012]. This agreement is independent of the original obligation. See Citibank [S.D.] v Cutler, 112 AD3d 573, 573-574 [2d Dept 2013]. "A cause of action for an account stated has been described as 'an alternative theory of liability to recover the same damages allegedly sustained as a result of the breach of contract.' " Episcopal Health Services, Inc. v Pom Recoveries, Inc., 139 AD3d 917, 919 [2d Dept 2016] quoting A Montilli Plumbing & Heating Corp. v Valentino, 90 AD3d 961, 962 [2d Dept 2011]. "An essential element of an account stated is that the parties came to an agreement with respect to the amount due." Id. A party's silence or failure to object to an account stated cannot be interpreted as an agreement that the account is correct but upon consideration of the facts surrounding a particular transaction the absence of an objection within a reasonable time may result in an implied account stated. See id. quoting Interman Inds. Prods. V R.S.M. Electron Power, 37 NY2d 151, 154 [1975].

Here, the Plaintiff has failed to demonstrate through their evidentiary submissions that the parties came to an agreement as to the amount due. Plaintiff failed to provide any documentation of invoices sent to Defendant HIGHBURY that were ignored or disputed. The Verified Complaint and Dimicco Affirmation both allude to the existence of invoices in relation to all four (4) of the alleged contracts but provide no dates of the invoices, to whom the invoices were sent and what, if any, response was received based on the sending of the invoices. Therefore, all of the causes of action for account stated are denied.

Sixth, Twelfth, Eighteenth, Twenty-Fourth Causes of Action — Violation of Article 3-A of the Lien Law

"Article 3-A of the Lien Law provides that 'funds . . . received by a contractor under or in connection with a contract for . . . a public improvement . . . and any right of action for any such funds due or earned or to become due or earned, shall constitute assets of a trust.' " RLI Ins. Co. v New York State Dept. of Labor, 97 NY2d 256, 261 [2002] quoting Lien Law § 70(1). The purpose of article 3-A of the Lien Law is to create " 'trust funds out of certain construction payments or funds to assure payment of subcontractors, suppliers, architects, engineers, laborers, as well as specified taxes and expenses of construction.' " Park East Construction Corp v Uliano, 233 AD3d 888, 889 [2d Dept 2024] quoting Aspro Mech. Contr., Inc. v Fleet Bank, 1 NY3d 324, 328 [2004].

Pursuant to Lien Law § 71, assets of an article 3-A trust are to be held and applied to payments made to article 3-a trust beneficiaries and for costs of improvement to real property. Further, "[a]n article 3-a trust commences 'when any asset thereof comes into existence' and continues until all trust claims have been paid or discharged, or all assets have been applied for trust purposes." Id at 262 citing Lien Law § 70(3). Additionally, "Lien Law article 3-A mandates that once a trust comes into existence, its funds may not be diverted for non-trust purposes. Use of trust assets for any purpose other than the expenditures authorized in Lien Law § 71 before all trust claims have been paid or discharged constitutes an improper diversion of trust assets, regardless of the proprietary of the trustee's intentions." Id. at 263 citing Lien Law § 72(1).

Plaintiffs motion for default judgment on the causes of action alleging diversion of trust funds pursuant to Lien Law article 3-A is denied. Plaintiff's evidentiary submissions fail to demonstrate that trust funds were diverted by the Defendants. First, the Court notes that Plaintiff has failed to provide any evidence that Defendants GORMAN, GRIFFIN, FOGARTY and "JOHN/JANE DOE" are owners, CEOs or shareholders of Defendant HIGHBURY.

In fact, other than the allegations within the Verified Complaint of ownership, there is no reference to GORMAN, GRIFFIN or FOGARTY in any of the four (4) contracts upon which Plaintiff's claims are based. " 'A corporate officer may be liable for torts committed by or for the benefit of the corporation if the officer participated in their commission.' " PDK Labs, Inc. v G.M.G. Trans West Corp., 101 AD3d 970, 973 [2d Dept 2012] quoting Hamlet at Willow Cr. Dev. Co., LLC v Northeast Land Dev. Corp., 64 AD3d 85, 116 [2d Dept 2009]. However, the mere fact that an individual is a corporate officer does not automatically mean they incur personal liability for the corporation's torts merely because of their official title. See id. Rather, " 'a corporate officer or agent is not liable for acts of conversion attributable to the corporation if he did not participate in and was not connected with the acts in any manner.' " Id. quoting 14A NY Jur. 2d, Business Relationships § 777.

Here, Plaintiff has provided no evidentiary documentation that Defendant HIGHBURY or any of the individual Defendants received trust assets. Additionally, other than a conclusory allegation that Defendants diverted trust assets, which Plaintiff indicates is based upon "information and belief," the Plaintiff has provided no evidentiary support of their claim that trust assets were used for any purpose other than expenditures authorized in Lien Law § 71 or if they were which of any of the three (3) alleged corporate officers were engaged in the violative conduct. Further, Plaintiff has not proffered any evidence of the existence of the trustee's deposit of trust funds in a bank or other depository or a lack of compliance by Defendants with the recordkeeping requirements set forth in Lien Law § 75.

Both Plaintiff's Verified Complaint and the Demicco Affirmation submitted in support of the instant application are rife with conclusory allegations. The vague and conclusory statements within the Demicco Affirmation do not illuminate the vague allegations within the Verified Complaint sufficiently to allow this Court to grant Plaintiff's application for default judgment. Based upon the foregoing all of Plaintiff's claims for violations of Article 3-A of Lien Law are denied.

Twenty-Fifth Cause of Action — Replevin and Twenty-Sixth Cause of Action — Conversion

"A cause of action sounding in replevin must establish that the defendant is in possession of certain property of which the plaintiff claims to have a superior right." Nissan Motor Acceptance Corp. v Scialpi, 94 AD3d 1067, 1068 [2d Dept 2012].

" 'Conversion is the unauthorized assumption and exercise of the right of ownership over goods belonging to another to the exclusion of the owner's rights.' " PDK labs, Inc v G.M.G. Trans West Corp., 101 AD3d at 973 quoting State of New York v Seventh Regiment Fund, 98 NY2d 249, 259 [2002]. " '[T]o establish a cause of action in conversion, the plaintiff must show legal ownership or an immediate superior right of possession to a specific identifiable thing and must show that the defendant exercised an unauthorized dominion over the thing in question . . . to the exclusion of the plaintiff's rights . . . ' " Batsidis v Batsidis, 9 AD3d 342, 343 [2d Dept 2004] quoting Independence Discount Corp. v Bressner, 47 AD2d 756, 757 [2d Dept 1975]; Westbury Recycling, Inc v Westbury Transfer & Recycling, LLC, 209 AD3d 929 [2d Dept 2022].

Plaintiff's allegations fail to provide a specific identifiable item, other than "concrete framework," over which they claim to have a superior right. The receivable aging list that is annexed to the Plaintiff's application references "destroyed material," "missing items," and items "converted to purchase," but fails to provide any description of those items other than their cost. Further, Demicco, the Northeast Manager of Plaintiff provides no insight into the items Plaintiff alleges that they have a superior right of possession over as it does not address any "equipment" that is the subject of either cause of action. Based upon the foregoing, the Plaintiff has failed to provide the necessary proof of facts required by Civil Practice Law and Rules § 3215 for which this Court can grant default judgment.

Attorney's Fees

In general, "except where authorized by statute, agreement, or court rule" attorney's fees are not recoverable by the prevailing party as they are incidents of litigation. See Aydin v Board of managers of Decora Condominium, 76 Misc 3d 1217(A) [Supreme Ct, Kings Cty 2022] citing LG Funding, LLC v Johnson and Son Locksmith, Inc., 170 AD3d 1153, 1154 [2d Dept 2019]. Here, based upon the Dimicco Affirmation, the Plaintiff is seeking "in excess of $27,000" in attorney's fees based upon the necessity to enforce Defendant HIGHBURY's payment obligations which they are entitled based upon the contracts. Dimicco does not provide the portion of the contracts that allow for the recovery of attorney's fees, but the Court's review of the contracts reveals that Plaintiff is entitled to recovery of attorney's fees based upon paragraph seventeen (17) "Enforcement of Agreement" of the General Terms and Conditions in three (3) of the four (4) contracts submitted. See NYSCEF Doc Nos. 32, 34, and 35.

The contract submitted by Plaintiff as to 520 Fifth Avenue, New York New York does not contain General Terms and Conditions annexed to the end of the contract, as the other three (3) contracts do. See NYSCEF Doc. No. 33. Based upon the deficiency in the contract as to 520 Fifth Avenue, New York, New York, the Plaintiff's application for attorney fees in enforcing that contract is denied.

As to the balance of the three (3) contracts the Plaintiff has failed to include an affirmation of services or any explanation as to the basis for Dimicco's application of "in excess of $27,000." Plaintiff's application for attorney fees for enforcement of the contracts for 44th Road, 180 Ashland Place, and Kent Avenue, are denied with leave to refile upon proper affirmations of services as to the enforcement of those contracts only.

Accordingly, it is hereby

ORDERED that Plaintiff's Motion for Default Judgment (Motion Seq. No. 2) is granted as to the First, Thirteenth, and Nineteenth Causes of Action for Breach of Contract and denied as to the Seventh Cause of Action for Breach of Contract consistent with the foregoing; and it is further

ORDERED that Plaintiff's Motion for Default Judgment for the remaining causes of action are denied without leave to refile; and it is further

ORDERED that Plaintiff's application for attorney's fees is denied as to the enforcement of the contract for 520 Fifth Avenue, New York, New York; and it is further

ORDERED that Plaintiff's application for attorney's fees as to the enforcement of the contracts for the 44th Road Project, the 180 Ashland Place Project and the Kent Avenue Project is denied with leave to refile upon proper affirmations of services as to the enforcement of those contracts only; and it is further

ORDERED that plaintiff is directed to provide notice of the Decision and Order to all Defendants within twenty (20) days of the date hereof.

The foregoing constitutes the Decision and Order of this Court on Motion Seq No. 2.

Dated: August 7, 2026

New City, New York

John P. Collins, Jr., J.S.C.

FOOTNOTES

1.   This amount was determined by the following - the aggregate amount sought by Plaintiff ($906,083.40) minus the amount alleged owed on the contract for 520 Fifth Avenue ($347,860.80).

John P. Collins, Jr., J.