Perrone v. Amato
| Decision Date | 30 June 2017 |
| Docket Number | CV 09-316 (AKT) |
| Parties | JOSEPH PERRONE, Plaintiff, v. ROSE ANN AMATO and JACK AMATO, Defendants. |
| Court | U.S. District Court — Eastern District of New York |
I. PRELIMINARY STATEMENT
This case arises in the context of the deterioration of a family relationship. Plaintiff Joseph Perrone ("Plaintiff") brings this action against Defendants Rose Ann Amato (or "Rose Ann") and Jack Amato (or "Jack") (collectively, "Defendants") asserting claims for breach of contract, fraudulent conveyance pursuant to the New York Debtor and Creditor Law ("DCL") §§ 273 and 276, conspiracy, fraud, constructive trust, and tortious interference. See generally, Second Amended Complaint ("SAC") [DE 80]. The Court has jurisdiction over this action pursuant to 28 U.S.C. § 1332, and the parties have consented to this Court's jurisdiction for all purposes in accordance with 28 U.S.C. § 636(c) and Fed. R. Civ. P. 73. See DE 114.
The Court conducted a bench trial which lasted three days, see DE 120-22, and hereby issues the following Findings of Fact and Conclusions of Law, pursuant to Rule 52(a) of the Federal Rules of Civil Procedure. In reaching these findings and conclusions, the Court heard the testimony and observed the demeanor of the witnesses, viewed and assessed the evidence adduced by each side, and considered the arguments and submissions of counsel. Only those facts the Court deems necessary for the resolution of the claims are discussed here. For the reasons set forth below, the Court finds that Plaintiff has proven his claims for breach of contract, violations of DCL § 276, fraud, and conspiracy. Plaintiff has not proven his claims for violations of DCL § 273 or tortious interference and those claims are dismissed. Further, Plaintiff's requests for the imposition of a constructive trust and for punitive damages are denied. However, Plaintiff's request for attorney's fees under DCL § 276 is granted.
II. FINDINGS OF FACT
The Court incorporates the parties' Stipulated Facts as set forth in the parties' Joint Pre-Trial Order ("JPTO" [DE 91]) as findings of the Court. Additional findings of fact are made based on the testimony and evidence presented at trial.1 Disputed facts are addressed and resolved in Section II(C), infra.
This case presents the unfortunate circumstance of a family divided. Anna Perrone had two children, namely, Plaintiff Joseph Perrone and Defendant Rose Ann Amato. See JPTO, Stipulated Facts 1, 3.2 Sometime in the 1980s, Anna Perrone purchased a residence at 632 Jefferson Street, West Hempstead, New York (the "Premises"). SF 5, 6. Defendants Rose Ann and Jack Amato and their children moved to the Premises in the early 1990s. SF 7. Initially, Defendants paid rent to Anna Perrone of approximately $1,000 per month. SF 8. At that time,Defendants3 owned a restaurant, "Amici's," which had first opened in 1983 or 1984. Tr. 199.
On May 20, 2003, Anna Perrone executed a durable general power of attorney ("Power of Attorney"). See Tr. 94-96; 398-399; Pl.'s Ex. 6 (May 20, 2003 Power of Attorney for Anna Perrone). The Power of Attorney was prepared by attorney John Ryan, Esq. ("Attorney Ryan"). Tr. 398. The Power of Attorney named both of Anna's children, Joseph Perrone and Rose Ann Amato, as attorneys-in-fact and agents of Anna Perrone. See Ex. 6.
On May 8, 2004, Anna Perrone suffered a massive stroke. SF 2. At that time, Anna owned the Premises free of any liens. SF 23. Defendants were living in the Premises at that point, but ceased making monthly rental payments thereafter. SF 8. During the period running from May 28, 2004 through the fall of 2004, Anna Perrone was hospitalized in New York and then was placed in a rehabilitation facility. SF 4. After that, in approximately October 2004, Anna Perrone returned to the Premises, where Rose Ann and Jack Amato also continued to reside with their son. Tr. 26, 200.
Anna Perrone's stroke left her unable to speak, sign checks, pay bills, use credit cards, or care for her daily needs. SF 2; Tr. 302. She could not talk, use the bathroom by herself, clean herself or cook, and she sometimes wet the bed and had episodes of hyperactivity. Tr. 97-99. After the stroke, Anna Perrone required daily physical care. Tr. 200. She also required someone to manage her finances. Tr. 308. In general, after the stroke, Rose Ann managed Anna Perrone's finances. Id. However, the parties dispute who was primarily responsible for providing Anna Perrone with physical care, and whether or not Anna Perrone'sfinances/resources covered the costs of this care, as outlined in detail below. See Section II(C), infra.
After Anna Perrone's stroke, Defendants approached Plaintiff to advise him that they wished to seek out options to legally protect the Premises in the event that Anna Perrone would need nursing home care. SF 11. Plaintiff and Defendants attended a meeting with Attorney Ryan to obtain legal guidance about protecting the Premises. SF 12. As a result of that meeting, title to the Premises was deeded by Anna Perrone, as grantor, to Rose Ann Amato, as grantee, on February 8, 2005, pursuant to a deed prepared by Attorney Ryan. SF 16, 20; Pl.'s Ex. 2 (the "Deed"). The Deed was signed on behalf of Anna Perrone by Plaintiff Joseph Perrone as attorney-in-fact of Anna Perrone under the Durable Power of Attorney. SF 16, 20; Pl.'s Ex. 2. Under the terms of the Deed, Anna Perrone retained a life estate in the Premises. SF 16; Pl.'s Ex. 2.
Later that same day, Plaintiff Joseph Perrone and Defendant Rose Ann Amato attended a meeting with Attorney Ryan at his law office. SF 17. There, Joseph and Rose Ann signed a written agreement regarding the Premises. SF 18; Pl.'s Ex. 1 (the "Agreement"). The Agreement provided that at Anna Perrone's death or upon the sale of the Premises, whichever occurred first, Rose Ann Amato would give Joseph Perrone a one-half interest in the Premises, or pay Joseph Perrone the monetary equivalent after the sale. Pl.'s Ex. 1. Rose Ann Amato voluntarily signed the Agreement. SF 19. As outlined below, the parties dispute whether Jack Amato was present during the meeting with Attorney Ryan at his law office on February 8, 2005 and whether Jack Amato had knowledge of the Agreement providing Joseph Perrone with a one-half interest in the Premises. See Section II(C), infra.
In June or July of 2005, Defendants sold Amici's. Tr. 209. Shortly thereafter, in or about August 2005, a convenience account was established in the name of Defendant Rose Ann Amato and Plaintiff Joseph Perrone at HSBC Bank in New York ("HSBC Acct. 8600"). SF 26. This HSBC Bank account was established for the benefit of Anna Perrone and was funded with the assets of Anna Perrone. SF 27.
Around October 2005, home health aides from an agency called "Aging at Home" began providing in-home care for Anna Perrone. Tr. 231. In late 2005 or early 2006, Rose Ann advised her brother Joseph that their mother Anna's money was running low. SF 21. In order to provide Anna Perrone with additional income, a reverse mortgage line of credit was obtained through Bank of America for the Premises on or about April 29, 2006 ("BOA Loan #0443"). See SF 22, 31, 40. The reverse mortgage line of credit created a first mortgage lien on the Premises and was executed by Rose Ann Amato and Anna Perrone (who held a life estate) as mortgagors. SF 23, 24. As monthly advances were made by Bank of America on the reverse mortgage, the mortgage lien on the Premises increased. SF 25.
On April 20, 2006, initial funds from the reverse mortgage line of credit in the amount of $24,485.00 were deposited in HSBC to an account in the name of Anna Perrone ("HSBC Acct. 4874"). SF 28; Pl.'s Ex. 10 (HSBC Acct. 4874 Checks 4447, 4448). Subsequent funds received from the reverse mortgage line of credit were deposited to HSBC Acct. 8600 in the name of Rose Ann Amato and Joseph Perrone during the period running from May 1, 2006 to March 1, 2008. SF 29. Initially, Joseph Perrone and Rose Ann Amato agreed that monthly deposits of $4,500 would be deposited into this joint account, HSBC Acct. 8600, from the reverse mortgage line ofcredit. Tr. 50, 243. For some period of time, Seattle Mortgage was a loan servicer on the reverse mortgage line of credit. SF 30.
On September 5, 2006, Defendant Rose Ann Amato signed Anna Perrone's name to a line of credit draw down and requested, in the name of Anna Perrone, a $10,000 draw down on the reverse mortgage line of credit. SF 32. Further, Rose Ann Amato signed Anna Perrone's name to a September 18, 2006 letter to Seattle Mortgage, requesting an increase in monthly payments under the reverse mortgage line of credit from $4,500 to $6,000. SF 33, 34; Pl.'s Ex. 12 (Sept. 18, 2006 letter to Seattle Mortgage). This increase was approved by Seattle Mortgage. Tr. 263. Plaintiff did not recall ever being advised by his sister that this increase had been requested and approved, nor did he authorize such an increase. Tr. 52-53. Rose Ann Amato testified that she informed Plaintiff about the increase and that the additional funds were necessary for the care of Anna Perrone. Tr. 268. These disputed facts are addressed in Section II(C), infra.
In June 2006, Defendants Rose Ann Amato and Jack Amato moved from New York after purchasing a home in Port St. Lucie, Florida. Tr. 246. Anna Perrone remained living at the Premises under the care of the home health aides from Aging at Home. Tr. 232. Rose Ann would return to the Premises from Florida approximately once every two or three weeks, and she continued to manage the finances of Anna Perrone. Tr. 336-337.
Eventually, in May of 2007, Defendants moved Anna Perrone to Florida, where she began residing at an assisted living facility, "Nature's Edge." SF 35. After three months at Nature's Edge, Anna Perrone was moved to a different assisted living facility in Florida, namely, "The Palms." Tr. 232-233.
In July 2007, the...
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