DeSANTIS v. GENERAL ADVISORY FUNDING CORP

Reset A A Font size: Print

Supreme Court, Appellate Division, Second Department, New York.

Philip DeSANTIS, respondent, v. GENERAL ADVISORY & FUNDING CORP., appellant.

Decided: September 26, 2005

HOWARD MILLER, J.P., BARRY A. COZIER, DAVID S. RITTER, and ROBERT A. SPOLZINO, JJ. Paul D. Jaffe, White Plains, N.Y., for appellant. Paul T. Vink, P.C., White Plains, N.Y., for respondent.

In an action to recover the balance due on a promissory note, the defendant appeals from so much of an order of the Supreme Court, Westchester County (Jamieson, J.), entered July 31, 2003, as denied its motion for summary judgment dismissing the complaint and to sever its third affirmative defense and counterclaim, and granted that branch of the plaintiff's cross motion which was for summary judgment dismissing the third affirmative defense and counterclaim.

ORDERED that the order is affirmed insofar as appealed from, with costs.

 The Supreme Court correctly denied the defendant's motion for summary judgment dismissing the complaint, in which it contended that the plaintiff sought to enforce a usurious transaction.   Although the interest charged on the subject loan exceeded the criminal usury rate (see Penal Law § 190.40) and was therefore usurious without regard to the lender's intent (see Freitas v. Geddes Sav. & Loan Assn., 63 N.Y.2d 254, 262, 481 N.Y.S.2d 665, 471 N.E.2d 437;  Fareri v. Rain's Intl., 187 A.D.2d 481, 482, 589 N.Y.S.2d 579), the evidence, including the defendant's own deposition testimony, was sufficient to raise a triable issue of fact as to whether the defendant should be estopped from raising usury as a defense (see Seidel v. 18 E. 17th St. Owners, 79 N.Y.2d 735, 743, 586 N.Y.S.2d 240, 598 N.E.2d 7;  Russo v. Carey, 271 A.D.2d 889, 890, 706 N.Y.S.2d 760;  Greenfield v. Skydell, 186 A.D.2d 391, 588 N.Y.S.2d 185;  Angelo v. Brenner, 90 A.D.2d 131, 457 N.Y.S.2d 630;  Hammond v. Marrano, 88 A.D.2d 758, 760, 451 N.Y.S.2d 484).

 The Supreme Court also correctly determined that the defendant, General Advisory & Funding Corp. (hereinafter GAF), was not the owner of the mortgage brokerage commission claim at the time it filed its answer and counterclaim seeking to recover the same.   Since the claim belonged to GAF's president at the time he commenced a bankruptcy proceeding in the United States Bankruptcy Court for the Southern District of New York, the bankruptcy court has exclusive jurisdiction over the claim (see 28 USC § 1334[e][1] ), and the Supreme Court properly declined to entertain it (see Hart Sys. v. Arvee Sys., 244 A.D.2d 527, 664 N.Y.S.2d 465;  Bromley v. Fleet Bank, 240 A.D.2d 611, 659 N.Y.S.2d 83;  Weiss v. Goldfeder, 201 A.D.2d 644, 608 N.Y.S.2d 242).

Copied to clipboard