Lacks v. Sepahbodi

• Citation: 78 Misc.2d 582,356 N.Y.S.2d 949
• Parties: Irene R. LACKS, Plaintiff, v. Parviz SEPAHBODI et al., Defendants.
• Decision Date: 07 June 1974
• Court: United States State Supreme Court (New York)

Page 949

356 N.Y.S.2d 949

78 Misc.2d 582

Irene R. LACKS, Plaintiff, v. Parviz SEPAHBODI et al., Defendants.

Supreme Court, Special Term, New York County, Part I.

June 7, 1974.

Salvatore E. Pirro, Flushing, for plaintiff.

Rogers & Wells, New York City, for defendant, Goodarzi.

Janet Fine Cotton, pro se.

NATHANIEL T. HELMAN, Justice:

Motions under calendar numbers 50 and 51 of March 19, 1974 are consolidated for disposition.

Both of these motions are brought to dismiss the complaint in an action to set aside a foreclosure sale and to restore possession of, and title to, the subject property to the plaintiff, Irene Lacks. At the conclusion of the foreclosure sale, the property was conveyed by the Referee, Janet Fine Cotton, one of the moving defendants herein, to 'Parviz Sepahbodi, as Consul General of Iran in New York, on behalf of the Government of Iran, and his respective successors in such office, 630 Fifth Avenue, New York, New York'. Moshen Goodarzi, the other defendant-movant herein, is the successor of Parviz Sepahbodi, as Consul General of Iran in New York.

The grounds asserted in support of the dismissal and common to both motions are: (1) that the court lacks jurisdiction over the subject matter of this action because it involves a foreign consul over whom jurisdiction is exclusively vested in the Federal District Courts; (2) that prosecution of the action against Consul General Goodarzi is barred by reason of his immunity; and (3) that the plaintiff, Irene Lacks, is barred from bringing this action by collateral estoppel involving a prior determination by the Appellate Division of the First Department. In addition, the defendant Cotton contends that the sale by her as referee was held pursuant to a lawful order of this court and, as such, may not be set aside.

In the earlier action a mortgage foreclosure proceeding was brought by plaintiff's husband concerning this property, wherein the present plaintiff asserted as a defense and counterclaim that by special agreements between the husband and wife, the husband had agreed to convey title to the wife. The counterclaim sought specific performance. Special Term having dismissed the counterclaim, a judgment of foreclosure was entered, and at the foreclosure sale, the government of Iran, as the highest bidder, purchased the property. Plaintiff appealed from the order of dismissal and the Appellate Division reversed both the order and judgment, holding that plaintiff was entitled to interlocutory judgment on her counterclaim. The Court said:

'At the foreclosure sale the property was purchased by the Government of Iran for $342,500, and it may be anticipated that any attempt to regain its possession will be met by a claim of sovereign or diplomatic immunity.' (39 A.D.2d 485, 488, 336 N.Y.S.2d 874, 878).

In the exercise of its equitable discretion the court, in lieu of awarding possession of the property to the wife, granted her an accounting, stating:

'It seems to us that justice will be served by directing that plaintiff account for and pay to defendant the proceeds of the foreclosure sale, crediting the plaintiff with any portion thereof found to be properly chargeable to defendant.' (Id. at 489, 336 N.Y.S.2d at 879)

The equitable determination of the Appellate Division was further challenged by application for reargument and resettlement, but such relief was denied, as was her cross-appeal to the Court of Appeals.

Plaintiff in the present proceeding, reiterates her request for possession of the premises and is, at once confronted with the application of the doctrine of collateral estoppel. That doctrine may be urged by a litigant whether or not he was a party to the first litigation. Under the enlightened principle of Schwartz v. Public Administrator, 24 N.Y.2d 65, 298 N.Y.S.2d...