The opinion of the court was delivered by: DUFFY
Samuel Kurzman was an attorney duly admitted to the practice of law in the State of New York. He was also a wheeler and dealer in real estate who, for his own personal reasons, often used nominees as record owners or mortgagors of the real estate in which he was dealing. Among those used as nominees by Kurzman were his wife, Rose Kurzman, his two daughters, Eleanore K. Lehrer (hereinafter "Eleanore") and Wilma J. Kurzman, now known as Wilma H. Hecker (hereinafter "Wilma"). At times, the nominees also included his sister, Natalie Rubin Lehrman (hereinafter "Natalie Rubin"); his brother-in-law Abe Rubin, and his son-in-law Sidney Lehrer; and his counsel and one-time partner, Max Block, Jr.
Samuel R. Kurzman is dead, having passed to his eternal reward on July 12, 1969.
Natalie Rubin passed away on May 16, 1973, after the institution of this action. Her son and executor, James Rubin, has been substituted as plaintiff.
The plaintiff's claim herein basically involves two parcels of land, one the Sanford Avenue site in Queens, and the other the East 107th Street site in Manhattan.
Taking first the Sanford site, through a number of mesne conveyances and mortgages Samuel Kurzman ended up with a mortgage held in the name of his daughters Eleanore and Wilma and his sister Natalie Rubin. There came a time on July 1, 1965, when the mortgage in the amount of $176,876.35, was assigned by the nominees to the East New York Savings Bank in return for a check drawn upon an account of that bank. Samuel Kurzman thereafter obtained the signatures of his two daughters and Natalie Rubin as endorsers of that check, cashed it, and apparently used part of the proceeds in another real estate transaction. It is clear that none of the nominees ever gave any consideration for the mortgage which was held in their names.
At or about the same time, Samuel Kurzman gave to his sister, Natalie Rubin, the amount of $5,500. Although the purpose of the payment is not entirely clear, it would appear that this sum was intended as a gift.
In the first cause of action, plaintiff claims that one-third of the monies received under the mortgage on the Sanford Avenue properties belonged to Natalie Rubin as the mortgagee of record, less the amount used by Samuel Kurzman in connection with the purchase of certain properties which make up part of the 107th Street parcel. As an alternative claim, the third cause of action seeks one-third of the monies received from the Sanford Avenue mortgage without deduction.
In support of these claims, a letter (Plaintiff's Exhibit 5) from Samuel Kurzman to Natalie Rubin was introduced. The letter is dated November 23, 1956 and discusses a contract for a mesne conveyance of the Sanford Avenue property from Kurzman's two daughters and Natalie Rubin to one Sydney Robbins with the terms providing for Eleanore, Wilma and Natalie Rubin to take back a purchase money mortgage for $150,000. In pertinent part the letter states:
"While the contract calls for $150,000, it is because I deemed it most expedient to set it up this way tax wise. The true amount that you, jointly with my daughters, will share equally is actually $285,000. This will be a life estate for the three of you and will be paid as provided in the contract as follows:
3 years at $9000 or $27,000 - $750 each quarter
12 years at $12,000 or $144,000-$10,000 each quarter
"Balance approximately $114,000 at the end of the 15th year making a total of $285,000. God willing. I hope to be able to guide you in this for many years. In my absence, however, Max Block, Jr., of my office and my son-in-law Sidney know all about the matter.
"At this juncture both Rose and I feel the delights of being living witnesses to something that we hope will enhance Abe's and your happiness for many years.
"Please sign all of the copies of the contract at the places indicated by your initials and have some one witness your signatures and return them immediately to my office.
"With all my love and very best wishes to you and yours,
P.S. I am certain that mother and father are happy at this wherever they may be." ...