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Almazan v. Almazan

United States District Court, S.D. New York

February 4, 2015

Margaret Almazan, et al., Plaintiffs,
v.
Tracy Almazan, et al., Defendants.

MEMORANDUM & ORDER

ALISON J. NATHAN, District Judge.

This case is an intra-family dispute regarding the purchase and sale of various residential properties in and around New York City. Plaintiffs Margaret Almazan and her husband, Ruben Almazan (collectively "Plaintiffs"), bring a number of claims against their daughter, Tracy Almazan, and her wife, Jennifer Almazan (collectively "Defendants"), including two claims each for breach of contract and fraud, and additional claims for unjust enrichment, money had and received, constructive trust, fraudulent concealment, breach of fiduciary duty, and a claim for an accounting.

The Defendants now move to dismiss the Plaintiffs' amended complaint for failure to state a claim under Federal Rules of Civil Procedure 9(b) and 12(b)(6). For the reasons below, their motion is granted in part and denied in part.

I. BACKGROUND

Under more typical circumstances, the facts of this case would describe nothing more than a routine commercial dispute between parties to a real estate transaction. Unfortunately, the present action concerns a dispute that has setyarent against child and vice-versa.

In 2004, Margaret Almazan gave $315, 000 to her daughter Tracy in order to assist her with the purchase of her first home. Am. Compl. ¶ 14. The Plaintiffs allege that this sum was advanced to Tracy with the understanding that their names would be listed on the shares of the cooperative and proprietary lease of the apartment to be purchased, located at 160 26th Street, New York, New York (the "26th Street Property"). Am. Compl. ¶¶ 14-15. The reason Plaintiffs insisted on having their names listed on the shares of the cooperative was to ensure that they would be repaid their $315, 000 in the event that the 26th Street Property was ever sold. Id ¶ 16. They insist that at no time did they or their daughter understand this money to be a gift. Id ¶¶ 17-18.

The closing for the 26th Street Property occurred on February 19, 2004. Id ¶ 20. At the closing the Plaintiffs believed their daughter, a New York-licensed lawyer specializing in real estate transactions, to be acting as their attorney. Id. ¶¶ 13, 21. In support of this belief, the Plaintiffs note a February 13, 2004 fax concerning the transaction sent from the Law Offices of Bryan W. Kishner & Associates, Tracy's then-employer, to the legal counsel for Daniel Ferguson, the seller of the 26th Street Property. Am. Compl. ¶¶ 22, 25; Pls.' Ex. A. The Plaintiffs further contend that Tracy drafted the Preliminary Closing Statement for the transaction and forwarded a fax of that document to Margaret on February 17, 2004. Am. Compl. ¶¶ 26-28; Pls.'s Ex. B. There is no dispute that the Plaintiffs' names were ultimately listed on the shares of the cooperative. Id. ¶ 32.

For approximately eighteen months, between the close of the transaction and July 2005, Tracy resided at the 26th Street Property. Tracy Almazan Aff. ¶ 10 ("Tracy Affidavit"). During this period Tracy met her future wife, Jennifer Ellard. They first met in July 2004 and were married by a minister in November 2004. Id. ¶ 5. Because Tracy and Jennifer wished to conceive a child, Tracy determined that she would sell the 26th Street Property in order to purchase a larger apartment for herself, Jennifer, and any children they hoped to have. Id. ¶¶ 12-13. Accordingly, on July 20, 2005, Tracy and the Plaintiffs sold the 26th Street Property for $450, 000. Am. Compl. ¶ 33.

The Plaintiffs again allege that they believed Tracy to be acting as their agent and their attorney during the course of the sale. Id. ¶¶ 34-35. Specifically, they believed Tracy to be acting on Margaret's behalf by virtue of a power of attorney agreement executed in 2004. Id. ¶¶ 29, 34-35. Tracy acknowledges that, during the closing for the sale of the 26th Street Property in 2005, she was acting with power of attorney for her parents, but insists that her power of attorney was strictly limited to that particular transaction. Tracy Aff. ¶ 14.

After the sale of the 26th Street Property, Tracy represented to her parents that the transaction had resulted in net proceeds of $70, 000. Am. Compl. ¶ 37. The Plaintiffs authorized Tracy to use the funds generated by the sale, including the net proceeds, to purchase another cooperative apartment located at 65 Morton Street, New York, New York (the "Morton Street Property"). Id. ¶ 38. In June 2005, using the proceeds from the sale and a loan she obtained independently, Tracy purchased the Morton Street Property.[1] Id. ¶¶ 39-40. The Plaintiffs never received any proceeds from the sale of the 26th Street Property, but instead allegedly asked that, as a condition for using their share of proceeds to help purchase the new property, Margaret's name again be put on the title for the Morton Street Property. Id. ¶¶ 41, 43. Plaintiffs allege that Tracy agreed to put her mother's name on the title, but in fact never did so, instead placing her new wife's name on the title instead. Id. ¶¶ 44-46. As the Defendants explain it, however, the Morton Street Property was purchased with a mixture of Jennifer's separate contribution, proceeds from the sale of the 26th Street Property, and a mortgage. Tracy Aff. ¶ 16. Jennifer's name was put on the title in light of the fact that she and Tracy submitted a mortgage application as joint tenants with rights of survivorship, in addition to a joint co-op application. Id. ¶ 16. The Defendants lived in the Morton Street Property until May 2013. Id. ¶ 17.

In 2011, Jennifer and Tracy were remarried in New York State after the state's ratification of same-sex marriage. Id. ¶ 5. In September 2011, Tracy's wife Jennifer gave birth to their daughter, Eliza Almazan. Id. In June 2013, the Defendants sold the Morton Street Property for $1, 075, 000. Am. Compl. ¶ 55. The Plaintiffs allege that, in connection with the sale of that property, Tracy represented to them that they were not required to attend the closing because Tracy held power of attorney for Margaret and would represent her interests. Id. ¶ 56. The Plaintiffs explain that this was one example of Tracy's now eight-year long scheme to conceal the fact that her mother's name was never put on the title to the Morton Street Property. Id. ¶ 57.

The Defendants sold the Morton Street Property in order to facilitate the purchase of a new residence outside of New York City. Id. ¶ 60; Tracy Aff. ¶ 18. On July 2, 2013, the Defendants purchased real property at 18 Sunset Terrace, Maplewood, New Jersey (the "Sunset Terrace Property") for $525, 000. Id ¶¶ 63, 65. The Sunset Terrace Property was purchased with funds from the sale of the Morton Street Property, which Margaret believed to have been held jointly in her name. Id. ¶¶ 66-67.

The Plaintiffs again allege that, prior to the closing on the Sunset Terrace Property, Tracy represented to them that Margaret's name would be put on the title and that Tracy would act as her agent and attorney during the purchase of the property. Id. ¶¶ 60-62, 69-73. The Plaintiffs believe that these representations were calculated to keep them uninformed of the fact that Margaret's name was never put on the title to the Morton Street Property and would never be put on the title to the Sunset Terrace Property. Id. ¶ 74.

After the closing on the Sunset Terrace Property in July 2013, the relationship between mother and daughter fell apart and became deeply acrimonious. The Plaintiffs' version of events is that Margaret confronted Tracy regarding whether her name was ever placed on the title to any of the properties and that Tracy refused to provide her an answer. Id. ¶ 75. According to the Plaintiffs, at some later date Tracy agreed to take out a mortgage on the Sunset Terrace Property in order to pay back her mother $250, 000. Id. ¶¶ 76-77, Pls.' Exs. E, D. On July 16, 2013, the Plaintiffs sent Tracy an email requesting that she pay them the $250, 000 and return any letters regarding power of attorney, any closing statements, and the titles of any relevant properties. Pls.' Ex. E. In response, Tracy sent the Plaintiffs an email on July 17, 2013 stating "I will get a mortgage of $250, 000.00 on the new house and deliver the funds to both Margaret Almazan and Ruben Almazan if that is what she now wants." Pls.' Ex. F. With no payment forthcoming, on October 22, 2013, Margaret sent Tracy a letter demanding payment of $315, 000, the original sum given to Tracy for purchase of the 26th Street Propery in 2004. Pls.' Ex. H.

The Defendants put forward a materially different chain of events. First, they insist that the Plaintiffs never asked for Margaret's name to be put on the title to the Morton Street Property and never conditioned Tracy's use of the proceeds from the sale of the 26th Street Property. Tracy Aff. ¶¶ 15-16. Moreover, they explain that the Plaintiffs were never involved in the sale of the Morton Street Property or the purchase of the Sunset Terrace Property. Rather, the night before the closing of the Sunset Terrace Property, Tracy alleges that she received a panicked phone call from her mother insisting that her name be put on the title. Tracy Aff. ¶ 22. Margaret threatened that if her name was not put on the title, she would cut off all communication with her daughter. Id. Margaret insisted that her name be put on the title in order to protect her daughter from Jennifer, who she feared would divorce Tracy and deny her access to her daughter Eliza, who was biologically Jennifer's child. Id. Tracy insists that at no time during this conversation did she agree to put Margaret's name on the title and that she and Jennifer closed on the property the next day. Id. ¶¶ 22-23.

Tracy goes on to detail a series of rancorous conversations with her mother over the subsequent months. During this time, Tracy alleges that her mother suffered a psychotic episode, that her father pleaded with her to seek her mother's forgiveness in order to restore peace within the family, and that she offered the $250, 000 "repayment" as a gesture of goodwill, rather than as consideration for any loan. Id. ¶¶ 24-28. The Plaintiffs deny any such episodes. Ruben Almazan Aff. ¶ 7 ("Ruben Affidavit"); Margaret Aff. ¶ 4.

After this unfortunate chain of events, Plaintiffs brought suit against their daughter and daughter-in-law on January 14, 2014. See Dkt. No. 1. On March 24, 2014, the Defendants moved to dismiss the complaint. See Dkt. No. 10. In light of that motion, Plaintiffs amended their complaint on April 10, 2014. See Dkt. No. 18. Defendants again moved to dismiss the complaint on May 2, 2014. See Dkt. No. 24.

II. LEGAL STANDARDS

To survive a Rule 12(b)(6) motion to dismiss for failure to state a claim upon which relief can be granted, a plaintiffs complaint must provide "a short and plain statement of the claim showing that the pleader is entitled to relief, " that "give[s] the defendant fair notice of what the... claim is and the grounds upon which it rests." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). For purposes of the motion to dismiss, all of the "factual allegations contained in the complaint" must be "accepted as true." Id. at 572. Though these allegations need not be "detailed, " they must "state a claim to relief that is plausible on its face." Id. at 555. A complaint is facially ...


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