The opinion of the court was delivered by: Gershon, United States District Judge.
Plaintiff, Jean Martin, commenced this suit against the above-captioned defendants for multiple acts of fraud, conspiracy to commit fraud, aiding and abetting the commission of fraud, professional malpractice, breach of fiduciary duty, and violations of federal and state statutes, specifically, the Truth in Lending Act ("TILA"), 15 U.S.C. §§ 1601 et seq.; the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. §§ 2601 et seq.; and the New York State Deceptive Practices Act, NYGBL § 349.
This court has jurisdiction over plaintiff's TILA and RESPA claims pursuant to 28 U.S.C. § 1331 (general federal question jurisdiction)and supplemental jurisdiction over plaintiff's state claims pursuant to 28 U.S.C. §1367.
Presently before the court is plaintiff's motion for partial summary judgment, pursuant to Fed. R. Civ. P. 56, against defendant Fitzpatrick Neil St. Hill Dodson, Esq., a/k/a F. St-Hill Dodson, Esq. ("Dodson"), solely on her claim against Dodson for conversion. Dodson is the sole remaining defendant after all other defendants have reached settlements with the plaintiff or defaulted. There is no dispute that New York state law applies. For the reasons set forth below, plaintiff's motion is granted.
Unless otherwise indicated, the following facts are undisputed.
Plaintiff is the purchaser of residential property located at 1063 Greene Avenue, Brooklyn, New York (the "Property"). Defendant Worldwide Marketing USA, Inc. ("Worldwide") was the seller of the Property. In January, 2007, defendant Austin Smith ("Smith") had a contract of sale to purchase the Property from Worldwide for the price of $570,000 (the "Contract"). Dodson represented Smith in connection with his contract of sale to purchase the Property.
On March 28, 2007, Smith asked Worldwide to amend the Contract (the "Amended Contract") by increasing the purchase price to $800,000 and by shifting the clearing of repair violations from the seller to the purchaser, and Worldwide agreed. The Amended Contract also specified that the seller would return $162,000 ($54,000 for each of the three apartments on the premises) at the time of closing to the purchaser in order to offset the purchaser's cost for repairing violations on the property.
In addition, the Amended Contract included Smith's right to assign the Amended Contract.
An Agreement to Assign the Contract (the "Assignment") was executed by Martin and Smith on March 30, 2007. The Assignment provided that Smith would "assign all his rights, title and interest" in the Amended Contract to Martin and that Martin would "purchase and assume all of Smith's rights, title, interest and obligations" with respect to the Amended Contract. The Assignment specified that Martin would pay Smith, and that Smith would "accept, as and for the assignment of all of [Smith's] rights, title and interest in the [Amended] Contract the sum of $1.00, and [Martin] shall assume all obligations under said [Amended] Contract including all adjustments made ...."
Dodson was Smith's long-time attorney, and became Martin's attorney only at the time of the Assignment. At no time did Dodson disclose to Martin his dual representation, nor did Dodson disclose that he had represented Smith more than 10 times in the past. The plaintiff met Dodson for the first time at the closing for the sale of the Property, at which time the Assignment was also executed. Other than "letting [the plaintiff] know what [the assignment] was and then asking her to sign it," Dodson offered no legal advice to plaintiff.
At the closing, Worldwide paid plaintiff, as Smith's assignee and in accordance with paragraph 34 of the Rider to the Amended Contract, $159,334.43 for the repair violations.*fn1 Worldwide issued a check in the amount of $159,334.43 (the "Check") to "F. St. Hill Dodson as Attorney." Dodson acknowledged at his deposition that he accepted this check "as attorney for Ms. Martin." Dodson did not disburse the proceeds of the check to plaintiff; instead, he distributed all the proceeds to third parties, including Smith. He admits that he did so without any written or verbal consent from plaintiff. Dodson deposited at least $10,000.00 of the Check into an account in the name of FSD Consulting, an entity in which Dodson had a personal interest. According to Dodson, he distributed $75,000 to $85,000 (he didn't recall the exact amount) to Smith in consideration of the Assignment. It is unclear from the parties' submissions where the remainder of the monies from the Check went, but the parties agree that plaintiff did not receive any distribution.