Case ID: ad3d_93/html/0493-01.html
Source: Caselaw Access Project
Author: {"author": "", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Private Capital Group, LLC, et al., Respondents, v Private Lender Service Corp., et al., Defendants, and Gnosis LLC, Appellant.
    [939 NYS2d 852]
   Order, Supreme Court, New York County (Bernard J. Fried, J.), entered December 23, 2010, which, to the extent appealed from, granted plaintiffs’ motion for summary judgment on their claims for conversion and replevin, unanimously affirmed, with costs.

The motion court correctly found that Gnosis was not a holder in due course of the mortgages it had acquired using plaintiffs’ funds because its principal, Michael Bode, had actual knowledge, and not merely reason to know, of plaintiffs’ claim (see UCC 3-304 [7]; Hartford Acc. & Indem. Co. v American Express Co., 74 NY2d 153, 162-163 [1989]). Such knowledge was derived from all the attendant circumstances, including Bode’s participation in the underlying diversion of plaintiffs’ funds and his signing of the mortgage transfer documents, and not just from the complaint in a related action.

We have considered appellant’s other contentions and find them unavailing. Concur — Tom, J.P., Saxe, Acosta, DeGrasse and Román, JJ.