United States District Court, E.D. New York
OPINION & ORDER
GERSHON UNITED STATES DISTRICT JUDGE.
January 8, 2018, I issued an Opinion and Order (the
"January Order") dismissing plaintiff Adam
Plotch's complaint seeking invalidation of mortgages and
loan agreements connected to real property located at 387
Adelphi Street in Brooklyn ("the property"), and
declaratory judgements that his rights to the property are
superior to those of defendant Wells Fargo Bank, N.A.
("Wells Fargo"). Plotch now moves, pursuant to
Federal Rule of Civil Procedure 15(a)(2), to amend his
complaint to add claims for invalidation of a 2005
Consolidated, Extension, and Modification Agreement
("2005 CEMA") and a 2005 Consolidated Mortgage on
the property that the previous owner Philip McKenzie
("McKenzie") executed in favor of Wells Fargo.
Wells Fargo opposes the motion on the ground that plaintiffs
Proposed Amended Complaint ("PAC") would be futile
as it fails to state a claim. For the reasons set forth
below, plaintiffs motion is denied.
factual allegations of the original complaint are set forth
in the January Order, familiarity with which is presumed. The
January Order concluded that "the 2005 Consolidated
Mortgage supersedes the prior mortgages and is the mortgage
critical to the rights of the parties." January Order,
at 7. As plaintiff had not challenged the validity of the
2005 Consolidated Mortgage in his original complaint, I
granted defendant's motion to dismiss pursuant to Rule
12(b)(6) for failure to state a claim.
now moves to amend his complaint to add claims concerning the
2005 CEMA and 2005 Consolidated Mortgage. As to both,
plaintiff argues that, because McKenzie's signatures on
the recorded copies of those documents were "not
properly witnessed, notarized, or acknowledged," those
documents "[do] not meet the requirements for recording
in [the] Kings County land records," and therefore
cannot be enforced against him. PAC at ¶¶ 74, 84.
PAC refers to the 2005 CEMA, the 2005 Consolidated Mortgage,
and an "Affidavit under Section 255 Tax Law"
("Tax Affidavit"), which is annexed to the 2005
Consolidated Mortgage in the land records. Id. at
¶50. Although none of the documents is included as an
enclosure to the PAC, the PAC discusses the documents in
detail, referencing specific pages by page number and
describing their form, execution, and recording. Defendant
included with its opposition papers copies of the documents,
both as recorded and as maintained on file with
defendant. At oral argument, the parties agreed that
defendant's Exhibit C to the Declaration of Andrew B.
Messite accurately reflects the documents as available on the
public registry. Transcript of Oral Argument, July 23, 2018
at 7:2-16. Plaintiff also acknowledged that the 2005 CEMA,
the 2005 Consolidated Mortgage, and the Tax Affidavit were
executed contemporaneously. Id. at 8:2-16.
Leave to Amend Standard
"should freely give leave [to amend a complaint] when
justice so requires." Fed.R.Civ.P. 15(a)(2). A request
to amend should be denied only in the face of undue delay,
bad faith, undue prejudice, or futility of the amendment.
See Cox v. Blackberry Limited, 660 Fed.Appx. 23, 25
(2d Cir. 2016). An amendment would be futile if it would not
"withstand a motion to dismiss." Kassner v. 2nd
Ave. Delicatessen Inc., 496 F.3d 229, 244 (2d Cir.
2007). This standard requires that the proposed amendment
plead sufficient facts to "state a claim to relief that
is plausible on its face." Bell Atl Corp. v.
Twombly, 550 U.S. 544, 570 (2007). In considering a
motion to dismiss, a district court may consider the facts
alleged in the complaint, "documents attached to the
complaint as an exhibit," and documents incorporated by
reference in the complaint. See Chambers v. Time Warner,
Inc., 282 F.3d 147, 153 (2d Cir. 2002).
determining whether an amendment is futile, the court must
accept plaintiffs factual allegations as true. Medina v.
Tremor Video, Inc., 640 Fed.Appx. 45, 47 (2d Cir. 2016).
A court is however "not bound to accept as true a legal
conclusion couched as a factual allegation."
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Twombly, 550 U.S. at 555). Additionally, if the
allegations of a proposed amended complaint are contradicted
by documents made a part thereof, the document controls and
the court need not accept the allegations as true. See
Barnum v. Millbrook Care Ltd. P'ship, 850 F.Supp.
1227, 1232-33 (S.D.N.Y. 1994), aff'd, 43 F.3d
1458 (2d Cir. 1994) (table decision). "The non-movant
bears the burden of demonstrating that the proposed amendment
would be prejudicial or futile." Zucker v. Porteck
Global Servs., Inc., 2015 WL 6442414, at *4 (E.D.N.Y.
Oct. 23, 2015).
purposes of this motion, I consider the facts as alleged in
the PAC and defendant's Exhibit C. The plaintiff
references the Exhibit C documents in his PAC and
acknowledges their authenticity. I do not consider the copies
of the documents maintained on file with defendant because
the PAC does not reference those documents.
York Real Property Law § 291 provides that a conveyance
of real property, within the state, may be recorded "on
being duly acknowledged by the person executing the same, . .
. and such acknowledgment or proof duly certified when
required by this chapter." N.Y. Real Prop. Law §
291. Section 298 of the same chapter provides that
acknowledgment or proof of a conveyance of real property may
be made by a notary public. Id. at § 298. When
read together, the condition relevant here is that a
conveyance of real property may be recorded when signed by
the party executing the conveyance and acknowledged by a
central assertion in the PAC is that the 2005 CEMA and the
2005 Consolidated Mortgage are invalid as to plaintiff
although they were recorded in the public registry and
plaintiff actually reviewed them prior to his purchase of the
property. Plaintiff advances two arguments in this regard.
he argues that he did not have proper notice of the 2005 CEMA
and 2005 Consolidated Mortgage because the versions of the
documents viewable by him in the public record did not show
the identifying information of the notary public who
acknowledged McKenzie's signature. While a scribbled
signature appears in the notary blocks on the 2005 CEMA and
2005 Consolidated Mortgage, the notary's printed name,
notary number, county of qualification, and date of
commission expiration do not appear. Plaintiff pointedly
declines to make a claim that there is anything wrong with
the notarizations on the underlying documents.Rather, the
allegation is that, because plaintiff could not ...