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Adam Leitman Bailey, P.C. Defeats Claim to Finder’s Fee for Surplus Monies in Favor of Lender

In Gotham Asset Locators, Inc. v. Lender, Adam Leitman Bailey, P.C. won a motion to dismiss upon oral argument at the bench of the Honorable Duane A. Hart, J.S.C. of the Supreme Court, Queens County, in favor of the lender, in defeating the plaintiff’s claims of breach of agreement, unjust enrichment, and quantum meruit.

On August 26, 2013, the lender’s secured property was foreclosed upon for the non-payment of New York City real estate taxes resulting in surplus funds being deposited with the court after the sale. The plaintiff, an asset location and collection agency, contacted the lender soliciting the lender to hire the plaintiff to recover the surplus funds owed to the lender in exchange for a percentage of whatever was recovered to be paid to the plaintiff. After discussing the services offered with the plaintiff’s principal owner, and, according to the plaintiff, after fully negotiating and agreeing to the contingency fee and all other terms, the lender was sent a contract for execution. The lender, however, reneged on the agreement and, instead, retained his attorneys to recover the surplus funds. The plaintiff sued.

Adam Leitman Bailey, P.C. defeated the plaintiff’s claims that its fee was not a finder’s fee and this action should fall outside of the writing requirement imposed by the General Obligations Law § 5-701(a)(1) by successfully demonstrating, on a pre-answer motion to dismiss, that where parties have clearly manifested an intent not to be bound until there is a properly-executed written agreement, the parties will not be bound in the absence of such an agreement. Adam Leitman Bailey, P.C. highlighted a specific provision in the agreement itself to ensure that these facts stayed within the statute of frauds, despite the terms of the agreement arguably being negotiated and agreed to by both sides.

Exceptionally, not only did Judge Hart grant the motion to dismiss, but he granted it in the form of a so-ordered discontinuance, (as opposed to a decision), thereby precluding the plaintiff from even being able to appeal.

The Foreclosure Group at Adam Leitman Bailey, P.C. won this case for the lender with Jackie Halpern Weinstein representing the firm.

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