Mook v. Homesafe Am., Inc.

• Decision Date: 30 November 2016
• Citation: 144 A.D.3d 1116,2016 N.Y. Slip Op. 08054,41 N.Y.S.3d 759
• Parties: Henry MOOK, et al., appellants, v. HOMESAFE AMERICA, INC., et al., defendants, Guy Samuel, respondent.
• Court: New York Supreme Court — Appellate Division

144 A.D.3d 1116

41 N.Y.S.3d 759

2016 N.Y. Slip Op. 08054

Henry MOOK, et al., appellants,

v. HOMESAFE AMERICA, INC., et al., defendants,Guy Samuel, respondent.

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

Nov. 30, 2016.

Davis Polk & Wardwell LLP, New York, N.Y. (Daniel F. Kolb, Bryan McArdle, and M. Nick Sage of counsel), for appellants.

RUTH C. BALKIN, J.P., L. PRISCILLA HALL, SANDRA L. SGROI, and BETSY BARROS, JJ.

Appeal from an order of the Supreme Court, Nassau County (John M. Galasso, J.), entered December 9, 2014. The order, insofar as appealed from, in effect, granted that branch of the motion of the defendant Guy Samuel which was to stay the action insofar as asserted against him pending the resolution of a related criminal proceeding.

ORDERED that the order is affirmed insofar as appealed from, without costs or disbursements.

This action was commenced against Guy Samuel and others, alleging fraud, breach of contract, and other wrongful conduct relating to his company Homesafe America, Inc. (hereinafter Homesafe), which purported to provide mortgage modification services to homeowners. Samuel did not answer the original complaint, and the original plaintiffs obtained a default judgment against him in the principal sum of $23,165.55. The complaint was thereafter amended to add additional customers of Homesafe as plaintiffs. Shortly after leave to amend the complaint was granted, Samuel was indicted on federal criminal charges of wire fraud and conspiracy to commit wire fraud in connection with a scheme to defraud homeowners through Homesafe and other companies. Thereafter, Samuel indicated that he intended to invoke his Fifth Amendment right against self-incrimination in this action. Samuel moved to stay the action insofar as asserted against him pending resolution of the related criminal proceeding, excepting enforcement of the default judgment previously obtained against him under the original complaint, and for leave to serve and file a late answer within 30 days after the stay is lifted. In an order entered December 9, 2014, the Supreme Court, in effect, granted the motion. The plaintiffs appeal from so much of the order as, in effect, granted that branch of the motion which was to stay the action insofar as asserted against Samuel pending resolution of the related criminal proceeding.

A motion pursuant to CPLR 2201 to stay a civil action pending resolution of a related criminal action is directed to the sound discretion of the trial court (see Burgdorf v. Kasper, 83 A.D.3d 1553, 1556, 921 N.Y.S.2d 769 ; Matter of Astor, 62 A.D.3d 867, 868–869, 879 N.Y.S.2d 560 ; Britt v. International Bus Servs., 255 A.D.2d 143, 144, 679 N.Y.S.2d 616 ). “Factors to consider include avoiding the risk of inconsistent adjudications, [duplication] of proof and potential waste of judicial resources. A compelling factor is a situation where a defendant will invoke his or her constitutional right against self incrimination” (Britt v. International Bus Servs., 255 A.D.2d at 144, 679 N.Y.S.2d 616 [citation omitted]; see Zonghetti v. Jeromack, 150 A.D.2d 561, 563, 541 N.Y.S.2d 235 ; DeSiervi v. Liverzani, 136 A.D.2d 527, 528, 523 N.Y.S.2d 147 ). “Although the...