1

07-3868 -cv United States of Amer ica v. Abcon Associates, I nc.

1 U N IT E D S T A T E S C O U R T O F A P P E A LS 2 F O R T H E S E C O N D C IR C U IT 3 August Term 2008 4 Docke t No. 07-3868-c v 5 Argued: Novembe r 17, 2008 De cided: May 7 , 2009

6 GOL DB ERG & CON NOL L Y, 7 De fe nd ant- Cr os s- De fe nd ant- Counte r- Cla imant8 Cr os s- Cla ima nt- Ap pe lla

nt, 9 ARA Plumbi ng& H eatingCorp., on behalf of itself and othe r Judgment cr editors 10 entitled to share in the f unds rec eived by

Abcon Assoc iates, Inc., in conne ction 11 with the St. C harle s Hospital Project, Steven G. Rubin & A ssociates, P.C., 12 Inte rv e no r- De fe nd ant- Counte r- Cla ima nt, 13 Abcon Assoc iates, Inc., The Rosly n Savings B ank, 14 De fe nd ants -C ro ss- De fe nd ants -C ounte r- Cla ima nts , 15 Hi-L

ume Corporation, St . Vincent’ s Catholic Medical Center s of New York, 16 Kamco Supply

Corporation, 17 De fe nd ants -C ro ss- De fe nd ants -C ounte r- Cla ima nts , 18 Ha a s & Na

jari an, L L P, 19 De fe nd ant- Cr os s- De fe nd ant- Counte r- De fe nd ant20 Counte r- Cla ima nt- Cr os s- Cla ima

nt, 21 United States Fide lity & Guara nty Company , L ovett Silverman, HSBC USA, Inc., 22 De fe nd ants -C ro ss- De fe nd ants -C ounte r- Cla ima nts , 23 v.2 1 NE W YO RK

CO MMU

NI TYB AN CO RP., I

NC

. 2 Def endant- Cross-Def

endant- Counter-Claimant-Appe llee, 3 United States of Amer ica, United States Postal Service , 4 Pla int if f- Counte r- Cla ima

nt- De fe nd ant.

5 B e fo re : MI

NE R, SO TO MA YO R, a

nd RA GG I , Ci rc uit

Judg e s. 6 Appea l from an Or der f or Distribution of Interplea der F unds entere d on August 14, 2007, 7 in the United States District Court for the Ea stern District of N ew Yor k (Wex ler, J.), in an 8 int e rp le a de r a c tio n c omm e nc e d b y pla int if f- sta ke ho lde r, the Un ite d St ate s o f Ame ri c a on be ha lf 9 of the United States Postal Service , ag ainst numerous def endants-c laimants with competing 10 claims to funds in the sum of $2,405,150.32 deposited by the plaintiff into the re g istry of the 11 Clerk of the D istrict Court, the District Court having de nied a motion for summary judgme nt 12 made by

defe ndant-c laimant-appe llant Goldberg& Connolly and orde ringthat the appe llant’s 13 c la im t o th e fu

nd wa s su bo rd inate to d e fe nd ant- c la ima nt- a pp e lle e Ne w Y or

k Co mmunit

y 14 B anc or

p’ s c la im. 15 VACATED a nd REMANDED. 16 Mit c he ll B . Re ite r, Go ldb e rg& Conno lly , Ro c kv ill e 17 Ce ntr e , N e w Y or k, fo r D e fe nd ant- Cr os s- De fe nd ant18 Counte r- Cla ima nt- Cr os s- Cla ima

nt- Ap pe lla

nt. 19 J . Ted Donova n, Finkel, Goldstein, Rosenbloom, & 20 Na sh , L L P, N e w Y or k, Ne w Y or

k, fo r D e fe nd ant21 Counter-Claimant-Appe llee.1 In October 2003, New Y ork Community Ba ncorp, Inc., the multi-bank holding 1 2 company

for Ne w York Community Ba nk, completed the a cquisition of Rosly n Savings B ank of 3 Nassau County , New Y ork. N EW Y O RK C OMMUNI TY B ANK , A B OU T U S , T HE NY CB F AMI L Y OF 4 B A N KS (last visited May . 6, 2009), ava ilable at www .my nycb.com. F or cla

rity , we r efe r to the 5 appellee as “Rosly n” throughout this opi nion. 3 1 MI NER, Circuit J udg e: 2 Appellant Goldber g& Connolly (“G& C” ) appe als from a n Orde r for

Distribution of 3 Interplea der F unds (“Or der” ) ente red on August 14, 2007, in the United States District Court for 4 the Easter

n District of Ne w York ( Wex ler, J.). The Orde r distributed funds, inter a lia, to appellee 5 Ne w Y or

k Co mmunit

y B anc or p, Inc . ( f/ n/a Ros ly n Savin g s B ank ) ( “ Ros ly

n” ), in p ay

me nt o f i ts 1 6 claimed pe rfe cted se curity interest in an Interplea der F und (“F und”) se t up by the United States 7 Pos ta l Se rv ic e (“ USP S” ). Th e F un d w a s c re ate d to satis fy a jud g me nt t

he USP S ow e d ( “ USP S 8 J udg ment”) to Abc on Associates, Inc. (“ Abcon” ), a c ontrac tor the USPS had previously reta ined 9 and later

lear ned had a number of e x isting cla ims ag ainst it, necessitatingthe establishment of the 10 Fund. As a

result of Rosly

n’s prioritized interest, the re maining c laimants to the Fund, including 1 1 G & C , w e r e l e f

tw i thn o r e c o v e r

y. 12 Prior to the Orde r, on De cembe r 20, 2006, G & C made a motion for summar y judgme nt 13 seekinga dete rmination that Rosly n did not possess a perf

ecte d secur ity

interest in the F und. The 14 Di str ic t Co ur

t r e je c te d th is a

rgume nt a

nd c on c lud e d th at Ro sly

n’ s c la im t o th e F un d w a s se nio r t o 1 5 G & C’ s c o mp e ti n gc la im

. Se e U n it e d St ate s v . Ab c o nA s s o c s . , N o . CV0 5

- 3 1 7 8 , 2 0 0 6 WL 16 3751261 (E.D.N.Y . Dec . 18, 2006). 17 In this appeal, we revie w the district cour t’s analy sis of Rosly

n’s intere st in the Fund and 18 c on sid e r whe the r t he Ge ne ra l L oa

n a nd Se c ur ity Agre e me nt t

hat c re ate d Ro sly

n’ s inte re st 19 constituted an assig nment of judg ment for pur poses of N.Y . Gen. Oblig . L aw § 13- 103, or a4 1 secur ity

interest in money

under N .Y. U.C.C. L aw a rt. 9. We conclude that the Gene ral L oan and 2 Security

Ag ree ment’s assig nment of “a ll sums recover ed” f rom the USPS J udg ment constituted 3 an assignment of money or proc eeds r ece ived from the U SPS J udg ment and not an a ssignment of 4 the USP S Judg me nt i tse lf . A s a re su lt, purs ua

nt t o N .Y . U .C. C. L aw § 9- 31 2( b) (3 ), Ros ly n c ou ld 5 perf

ect its interest only

by takingpossession of the proc eeds of the Fund. H avingfailed to do so, 6 Rosly

n’s intere st in the Fund is unperf ecte d and ther efor e junior to G & C’s interest. We thus 7 va c ate the Or de r a nd re mand to t he Di str ic t Co ur

t f or fu rt he r p ro c e e din g s. 8 BACK GR OUND 9 I

. Es ta

bli shme nt o f t

he Inte rp le a de r F un d a

nd Cla ims Th e re to 10 Abcon wa s retaine d by the USPS i n connec tion with a Queens, N ew Yor k construction 11 projec t for wor

k on the dock a

nd elevators at the USPS Queens Proce ssing a nd Distribution 12 Center in F lushing, Ne w York. 13 On or a

bout Dece mber 31, 1997, the U SPS terminated the contra ct with Abcon, a lleg ing 14 de fa

ult in t he pe rf or manc e of the c ontr a c t. A ft e r t

he c ontr a c t w a s te rm inate d b y the USP S, 15 Abcon c ommenced a n action in the United States Court of F eder al Claims alleg ing wrong ful 16 termination. United States v. Abcon A ssocs., No. CV 05-3178, 2006 WL3751261, at *1 17 (E.D.N.Y . Dec . 18, 2006). On July 17, 2001, a judg ment was e ntere d in the Court of Fe dera l 18 Claims in favor of Abc on, pursuant to which Abc on was to be pa id an amount “to be de termined 19 as provided by” the ter ms of the contra ct betwe en Abc on and the USPS (the “USPS J udg ment”). 20 Abcon Assoc s., Inc. v. United States, 49 F ed. Cl. 678, 690–91 (2001). On D ece mber 4, 2002, the 21 United States Court of Appea ls for the F eder al Circuit aff irmed the judg ment of the Court of 22 Fe dera l Claims wit hout opinion. Abcon Assocs., Inc. v. United States, 52 F . App’x 510 (Fed.5 1 Cir. 2002). 2 On

June 28 , 2 00 5, fo llo wi ngan a ud it b y the De fe ns e Contr a c t Aud it A g e nc y , th e USP S 3 iss ue d a

fi na l de c isi on

de te rm ini ngtha

t Abc on wa s to be awa

rd e d th e sum of

$2 ,4 05 ,1 50 .3 2 in 4 satisfac tion of the terms of the U SPS J udg ment. Be fore that decision wa s issued, howeve r, 5 USPS rec eived notice of var ious judgments and othe r cla ims ag ainst Abcon. I d. As a re sult of 6 these c laims, USP S did not pay the agree d-upon sum but instead obtained lea ve fr om the District 7 Court to deposit the funds with the Clerk of the District Court. These de posited funds in the 8 amount of $2,405,150.32 constitute the Interplea der F und. 9 I I

. Ros ly

n’ s Cl a im o f P ri or ity 10 After

the USPS t erminate d its contract with Abc on, the United States F idelity and 11 Guar anty

Company

(“U SF & G”) paid claims in conne ction with various per formanc e and/or 12 pay

ment bonds issued to Abcon and guara nteed by Michae l Z enobia, Jr. (the President of A bcon) 13 and

his wi fe Th e re sa

M. Z e no bia

(t og e the r, the “ Z e no bia s” ). Af te r p ay me nt o n th e se bo nd s, USF 14 & Gcommence d an ac tion in the United States District Court for the Easte rn District of Ne w 15 York a

nd obtained a judgment ag ainst Abcon, the Z enobias, a nd three related cor

porations for the 16 amount of appr ox imately $2 milli on (the “ USF & G J udg ment”). 17 Ros ly

n, on or a bo ut M arc h 1 2, 20 02 , a g re e d to loa n Abc on , th e Z e no bia s, and South 18 S etauk et A ss oci ate s (“ S S A”) (apart ners hi p n eit her n ame d n or l iab le u nd er the U S F & G 19 J ud gment ) the s um of $ 2, 00 0, 00 0 (t he “2 00 2 R os ly n L oan ”) t o b e us ed t o s ati sfy th e US F & G 20 J udg ment. Approxim ately $1.7 milli on of that loan wa s used to satisfy the USF & G J udg ment. 21 Abcon Assoc s., 2006 WL3751261, at *1. 22 Ros ly

n’ s e xten sio n o f c re dit , v iz. t he 20 02 Ros ly

n L oa n, wa s se c ur e d in

a c c or da nc e wi th6 1 the pr ov isi on s o f t hr e e do c ume nts e xec ute d o n M arc h 1 2, 20 02 . I d. F ir st, the Z e no bia s a nd SSA 2 executed a Mor

tga g e and Sec urity

Ag ree ment (the “ Mortg ag e Agree ment”) to sec ure the 2002 3 Rosly

n L oan with ce rtain re al estate

. 4 Se c on d, the Z e no bia s, Ab c on , a nd Ros ly n e xec ute d a

Ge ne ra l L oa

n a nd Se c ur ity 5 A g r e e m e n t( th e “ S e c ur i ty A g r e e m e n t ” ) th atg r an t e d t o R o s l yn , a s c o l l at e r a l f

o r th e 2 0 0 2 R o s l yn 6 L oan, 7 [a] ll sums due [ USF & G and/or Z enobias] rec eived in ac tion: USF&G v. 8 AB CON Associate s, Inc. Et al - U SDC (Eastern D istrict N.Y.) Case #98-3826, 9 and all sums rec overe d by [t he Z enobias] from USPS relative to “projec t Queens 10 GMG-Doc k Ex pansion, Thre e Ne w Fr eig ht Elevators.” 11 Third, USF & G and Rosly n executed an a ssignment a g ree ment (the “ Assignme nt 12 Ag ree ment”), pur suant to which USF & G assig ned to Rosly n 13 all rig hts, tit le and inter est of [USF & G] in, t o and under (i) the judg ment dated 14 September 24, 2001 in fa vor of [USF & G] in an action pendingin the United 15 States District Court for the Ea stern District of N ew Yor k, Civil Action No. 98- 16 3826 entitled United States Fide lity and Gua ranty Company , Plaintiff, vs. Abcon 17 Associates, Inc., Aur ora Ma nag ement, Inc., Rede tech, Inc., A& D Group, I nc., 18 Mic ha e l Z e no bio , Jr. An d T he re sa Z e no bio , D e fe nd ants (t

he “ Judg me nt” ); and

(i i) 19 all claims that [USF & G] may have a s surety

ag ainst the [USP S] for c ompletion 20 of the proje ct known as the “Que ens GMG- Dock Expansion, Three Fr eig ht 21 Elevators.” 22 In ex chan ge, R os ly n agreedto wi re fu nd s i n t he s um of $ 1. 7 m il li on— t he am ou ntof t he U S F & 23 G J udg ment — plus interest and $10,000 in attorne y s’ fe es, to USF & G. This pay ment 24 c on sti tut e d f

ull satis fa c tio n o f t

he USF & G Jud g me nt. 25 In acc ordanc e with its security interests, on April 12, 2002, Rosly n filed a U CC-1 26 F ina

nc ingState me nt a g a ins t th e “ De bto rs ,” Z e no bia and Ab c on , w iththe Ne w Y or k St ate 27 Se c re tary

of State . I d. Th at F ina

nc ingState me nt n ame d a s c oll ate ra l:7 1 All sums recove red by Debtors ( direc tly

or through USF & G) fr om action 2 USF& G v Abcon A ssociates, Inc. et a l. USDC (Eastern D istrict NY) Case #98- 3 3826 and all sums rec overe d by Debtors ( direc tly

or through USF& G) fr om 4 United States Postal Service re lative to projec t “Quee ns GMG-Doc k Ex pansion, 5 Three New F reight Elevators.” 6 I I I

. Go ldb e rg& Conno lly ’s Cla im o f P ri or ity 7 Abcon’ s debt to claimant G & C arises fr om an ac tion G & C commenc ed ag ainst Abcon 8 in New Yor

k state cour

t in 1998. I d. at *2. That a ction culminated in a judg ment enter ed 9 J anuar

y 26, 2001, in favor of

G & C in the amount of $200,014.23. I d. G & C delivered a n 10 execution of that judg ment to the Sheriff of Nassau County , New Y ork, on Jul y 28, 2005. I d. 11 The re maining de fenda nts-claimants’ c laims ag ainst the Interplea der F und rang e fr om 12 approximately

$40,000 to $500,000. I d. 13 IV. Memorandum De cision and Orde r of the D istrict Court 14 In Se pte mbe r 2 00 6, G & C f ile d in the Di str ic t Co ur

t a mot ion fo r s umm ary

jud g me nt, 15 seekinga dete rmination that Rosly n did not possess a perf

ecte d secur ity

interest in the F und. 16 Ros ly

n f ile d a c ro ss- mot ion

fo r s umm ary

jud g me nt. 17 In its mot ion for summary judgme nt, G & C, re lying on the New Y ork Unifor m 18 Comme rc ia l Co de , c ha ra c te ri zed Ros ly n’ s se c ur ity

int e re st i n th e USP S Judg me nt a s a n inte re st 19 in m on e y

or pr oc e e ds fr om t

he USP S Judg me nt —

and no t in the jud g me nt i tse lf

and the ri g hts 20 there to. Thus, acc ordingto G & C, Rosly n did not possess a perf

ecte d secur ity

interest in the 21 mon e y

that no w c on sti tut e s th e Inte rp le a de r F un d b e c a us e “ a se c ur ity int e re st i n mo ne y

is 22 perf

ecte d only

when the holde r of the inter est is in actual possession of the mone y .” I d. at *2. G 23 & C a

rgued that if Rosly

n did not hold a perfe cted inter est, then the judg ment lien of G & C, the 24 judgme nt liens of the other judg ment-cr editor cla imants, and the liens and se cure d interests of the1 Th e Di str ic t Co ur t f ound that a “ g ra nt o f p ri or ity

to R os ly n [Savin g s B ank ] wil l a llo w i t 2 2 to e xh a

u s t t h e v a s t m a

jo r it y , if n o t a ll , o f

th e [In te r p le a d e r ] F un d

. ” Ab c o nA s s o c s . , 2 0 0 6 WL 3 37 51 26 1, at *2 (“ In th e e ve nt, ho we ve r, that Ro sly n [Savin g s B ank ] is n ot gra nte d p ri or ity , a ll 4 other c reditors will be pa id.”). We nee d not addre ss these finding s to resolve the a ppeal be fore 5 us . 8 1 other c laimants to the Interplea der F und would, as a matter of law , have pr iority over the claim of 2 Rosly

n. I d. 2 3 In its Memorandum Dec ision and Order dated De cembe r 18, 2006, the District Court 4 g rante d Rosly

n’s cr oss-motion for summary judgme nt. The District Court reje cted G & C’s 5 argume nt t

hat Ro sly n d id n ot h ave a

pe rf e c te d s e c ur ity

int e re st i n th e Inte rp le a de r F un d. In s o 6 doing, the District Court observed that N.Y. Gen. O blig. L aw § 13- 103 provides that a judg ment 7 for a

sum of money

can be transfe rre d and that “[s]uch a transfe r has be en held to be a transfe r of 8 a p r e s e n t i n te r e s t, e v e nif

th e ju d g me n t i s th e s u

b je c t o f ana p p e a l. ” Ab c o nA s s o c s . , 2 0 0 6 WL 9 3751261, at *3 (c iting L aw Rese arc h Serv. Inc. v. Mar tin Lutz Appellate Printers, Inc., 498 F .2d 10 836, 839 (2d Cir. 1974)). Thus, the District Court found that “[a]s an interest in an e x isting 11 judgme nt, Rosly

n’s intere st in the USP S J udg ment [was] a pre sent interest in a judg ment and not 1 2 a f u tur e i n t e r e s ti nm o n e y ye tt o b e r e c e i v e d

. ” Id

. A s s u c h , th e D i s tr i c tC o urts t at e d th atR o s l yn 13 need not be in actual possession of the money in the Fund to per fec t its security interest. I d. 14 Th e Di str ic t Co ur t f ur the r o bs e rv e d th at, “ a s a

n inte re st i n a

jud g me nt, Ros ly

n’ s li e n is 15 specific ally

exempt from the filing r equire ments of the UCC.” I d. (citingN.Y. U.C.C. L aw § 9- 16 109(d)( 9)). Ac cording ly , “the date upon which the loa n documents we re e x ecute d, [March 12, 17 2002], and not the date of the f iling of the UCC-1 [(April 12, 2002)], i s the date when Rosly n’s 18 interests bec ame a lien.” I d. The District Court conc luded: “Rosly n’s intere st in the Fund wa s 19 cre ated a s of Marc h 12, 2002. That intere st was an inter est in a judg ment, proper ly transfe rre d1 The District Court’s judg ment was not set out in a sepa rate document as r equire d under 3 2 Fe dera l Rule of Civil Procedur e 58(a ). Ne verthe less, pursuant to Rule 58(c) (2)( B) , the District 3 Court’s judgme nt beca me final 150 da

y s after the Orde r wa s entere d on the docke t and, pursuant 4 to Fede ral Rule of A ppellate Proc edure 4(a) (2), we deem G & C’s Notice of A ppeal to have been 5 timely

filed as of

that date. More over, w e note that “ [a] failure to set forth a judg ment or orde r 6 on a sepa

rate document whe n require d by Fe dera l Rule of Civil Procedur e 58(a )(1) does not 7 aff ect the va lidity

of an a ppeal f rom that judg ment or orde r.” F ed. R. App. P. 4(a) (7)( B) ; see 8 Jose phv. L e avitt, 4 65 F .3 d 8 7, 89 –9 0 ( 2d Cir . 2 00 6) . We the re fo re e xer c ise jur isd ic tio n in thi s 9 matter pursua

nt to 28 U.S.C . § 1291. 9 1 under N ew Yor

k law. Ac cording ly , [R osly n] has priority

over a ll other claimants.” I d. 2 G & C’s motion for rec onsideration wa s denied on Mar ch 29, 2007, United States v. 3 Abcon Assoc s., No. CV 05-3178 (L DW), 2007 WL1026418 (E.D.N.Y . Mar. 29, 2007) , and the 4 District Court entere d its Order f or Distribution of the Interplea der F und on August 13, 2007. 3 5 This timely

appea l followed. 6 AN AL YSI S 7 I

. 8 The District Court’s grant of summar y judgme nt is reviewe d de novo. Tra ns Sport, I nc. 9 v. Starter Sportswea r, Inc., 964 F .2d 186, 188 (2d Cir. 1992). Summary judgme nt may

not be 10 g ra

nte d unle ss “ the ple a din g s, the dis c ov e ry and dis c los ur e mate ri a ls o n f ile , a nd any a ff ida vit s 11 sh owthat th e re is n o g e nu ine iss ue a s to any mate ri a l f

a c t and tha t th e mov ant i s e nti tle d to 12 judgme nt as a matter of law.” Fe d. R. Civ. P . 56(c) ; see Adironda ck Tra nsit L ines, Inc. v. United 13 Transp. Union, L ocal 1582, 305 F .3d 82, 86–87 (2d Cir. 2002). The role of the court in dec iding 14 a motion for summary judgme nt “is not to resolve disputed issues of fa ct but to assess whethe r 15 the re are any

fa c tua l is su e s to be tr ie d, wh ile re so lvi ngambi guit ie s a nd dr awi ngre a so na

ble 16 infere nces a g ainst the moving pa rty .” Knight v. U.S. Fire Ins. Co., 804 F.2d 9, 11 (2d Cir. 1986). 1 7 II.10 1 In this case we must determine whe ther the G ener al L oan and Sec urity Ag ree ment 2 constituted an assig nment of a judg ment for pur poses of N.Y . Gen. Oblig . L aw § 13- 103 or a 3 secur ity

interest in money

under N .Y. U.C.C. L aw a rt. 9. Specifica lly , we must asce rtain whe ther 4 the Se c ur ity

Agre e me nt’ s a ssi g nme nt o f “ a ll s ums re c ov e re d b y [Ab c on and Z e no bia ] fr om U SPS 5 relative to ‘projec t Queens D MG-Doc k Ex pansion, Thre e new Fr eig ht Elevators’” constituted an 6 assig nment of the USPS J udg ment itself, and all rights thereto, or simply an assignment of all the 7 money

or proc eeds r ecove rable or re ceiva ble from the U SPS J udg ment or otherw ise arisingout 8 of the Qu e e ns c on str

uc tio n p ro

je c t. 9 Pur su ant t o N e w Y or k’ s U nif or m Co mme rc ia l Co de § 9 -3 12 (b )( 3) , a se c ur ity int e re st i n 10 mon e y

c an o nly be pe rf e c te d b y takin gpo sse ssi on , o r “ c ontr ol, ” of the mon e y . Se e N. Y. U. C.C

. 11 L aw § 9- 312(b)( 3) (“ [A] secur ity interest in money

may be per fec ted only

by the sec ured pa

rty ’s 12 takingpossession under Sec tion 9-313.”); cf . Be rkowitz v. Chavo I nt’l, Inc., 74 N.Y.2d 144, 13 146–47, 544 N.Y.S.2d 569, 570 (1989) ( holding that, unde r Ne w York’ s Uniform Commercia l 14 Cod e , a

c re dit or “ [is] r e qu ir e d to take po sse ssi on of [a p ro mis so ry] not e in o rd e r t o p e rf e c t it s 15 secur ity

interest ther ein.”) . By

contra st, under Ne w York la w the assignment of an e x isting 16 judgme nt awar ding a sum of money

is perfe cted at the time the assig nment is ex ecute d. See N.Y. 17 Gen. Oblig . L aw § 13- 103 (“Ajudgme nt for a sum of mone y , or direc ting the pa y ment of a sum 18 of money , rec overe d upon any cause of ac tion, may

be tra nsfer red; but if it is vacated or re verse d, 19 the transf

er the reof does not transfe r the c ause of action unless the latter

was tra nsfer able be fore 20 the judg ment was re cover ed”) ; L aw Rese arc h, 498 F.2d at 837, 838 (holding that under Ne w 21 York lawthe assig nment of an “ exis ting judg ment” for a sum of money

is a transfe r of a

prese nt 22 interest and that the “assig nment of an e x isting right cre ates a n immediate lien in favor of the1 Moreove r, the filingrequire ments of the Ne w York Uniform Commercial Code f or 4 2 pe rf

e c tio n o f s e c ur ity

int e re sts do no t a

pp ly to t he a ssi g nme nt o f a

jud g me nt. Se e N. Y. U. C.C

. 3 L aw § 9- 109(d)( 9) (statingthat Article 9 of New Y ork’s Unifor

m Comm erc ial Code does not 4 apply

to “an a ssignment of

a right repre sented by

a judgment, other than a

judgme nt taken on a 5 rig ht to pay

ment that was c ollatera l”). 11 1 assig nee that is valid ag ainst later lien c reditors of the assig nor” ( citing Stathos v. Murphy , 276 2 N.Y.S.2d 727 (N.Y. A pp. Div. 1966))) ; see a lso id. at 838 (“The assig nment of a f uture right . . . 3 cre ates a

lien that attache s only

at such time as the r ight a ccr ues.” ( citing O kin v. I saac Goldman 4 Co., 79 F.2d 317, 319 (2d Cir. 1935)) ). Thus, if we de termine that the Sec urity Ag ree ment 4 5 transfe rre d the USPS J udg ment itself, Rosly n’s intere st in the Fund would have been pe rfe cted a s 6 of Mar ch 12, 2002, the date the Secur ity Ag ree ment was e x ecute d. I f, howe ver, that document 7 tr ans fe rr e d o nly

an inte re st i n mo ne y

to b e ob ta ine d at a

late r d ate , Ro sly

n’ s inte re st w ou ld 8 rema in unperfe cted a nd G & C’s interest in the F und, perf ecte d on J uly

28, 2005, would have 9 p r i o r i ty. 10 We conclude that the Security Ag ree ment’s re fer ence to “all sums rec overe d by [t he 11 Z enobias] from USPS relative to ‘projec t Queens G MG-Doc k Ex pansion, Thre e F reight 12 Elevators’ ” expresses a clea r and una mbiguous intention betwe en sophisticated pa rties to transfe r 13 a sum of “mone y” and not a n exis ting “

judgme nt.” See Gr eenf

ield v. Phill es Recor ds, Inc., 98 14 N.Y.2d 562, 569 (2002) (“The fundame ntal, neutra l prec ept of c ontrac t interpretation is t hat 15 a g re e me nts are c on str ue d in a c c or d w iththe pa

rt ie s’ int e nt. Th e be st e vid e nc e of wh at pa rt ie s to 16 a wr itt e n a g re e me nt i nte nd is what th e y

sa y in t he ir wr iti ng . T hu s, a

wr itt e n a g re e me nt t

hat is 17 complete, c lear

and unambiguous on its face must be enfor ced a ccor ding to the pla in meaningof 18 its te rm s. ” (i nte rn a l qu otatio n ma rk s and c itatio ns omi tte d) ). Ha d th e se pa rt ie s inte nd e d to 19 assig n the USPS J udg ment and not “a ll sums recover ed . . . re lative to” the Que ens construc tion12 1 projec t, they

would have dr afte d the applica ble clause of the Sec urity Ag ree ment using the word 2 “judg ment,” or at least ref ere nced the action fr om which that judg ment arose . Moreove r we see 3 no differ ence betwee n the use of “ [a] ll sums due plaintiff (and/or Unde rsig ned) r ece ived in [t he 4 USF & G ac tion] ” and “ all sums recove red” later in the same sentenc e re g ardingthe construc tion 5 projec t. The plain languag e evide nces the parties’ intent to pledge money to Rosly n by assig ning 6 any

and a ll m on e y

and pr oc e e ds re c ov e ra

ble and re c e ive d f

ro m e ith e r o f t

he se tw o s ourc e s. 7 Additionally , it is uncontested that the third document e x ecute d in connec tion with the 8 20 02 Ros ly

n L oa n a ssi g ne d to Ros ly

n U SF & G’ s r ig hts in t

he USF & G Jud g me nt, no t me re ly 9 sums o r p ro c e e ds re c ov e re d f ro m th e USF & G Jud g me nt. Th at do c ume nt — e xec ute d th e same 10 da

y a s th e Ge ne ra l L oa

n a nd Se c ur ity Agre e me nt —

re fe rs no t to “ sums d

ue ” or “ sums 11 rec overe d” but to “an a ction pending ” and, spe cifica lly , “the ‘ J udg ment.’” The omission of such 12 langua g e fr om t

he Ge ne ra l L oa

n a nd Se c ur ity Agre e me nt f

ur the r e vid e nc e s th e pa

rt ie s’ int e nt t o 13 pledg e money , not a judg ment, to Rosly n in the document at issue in this case

. 14 Finally , insofar a s the phrase “all sums rec overe d” is ambiguous, the ambiguity must be 15 rea d ag ainst the draf ter of the assig nment, Rosly n. J acobson v. Sassowe r, 66 N.Y.2d 991, 993, 16 499 N.Y.S.2d 381, 382 (1985). 17 Ros ly

n r e lie s in pa rt on L aw R e se arc h to su

pp or t it s p os iti on , b ut t

hat c a se is 18 distinguishable. In L aw Rese arc h the cr editor filed two se cure d claims with the bankruptc y court 19 afte r the de btor filed its petition for bankruptc y on J une 19, 1971. 498 F .2d at 837. The de btor 20 had assigned “a

part of the judgme nt,” enter ed in state c ourt in favor of the de btor, to the cre ditor 21 on Fe bruar

y 1, 1971. The a ssignment, howe ver, w as not filed until May 5, 1971, which the 22 bankruptc y

court de termined to be c lear ly within the “four- month period prec edingbankruptc y .”13 1 I d. As such, the de btor soug ht an orde r fr om the bankruptc y court that the a ssignment wa s 2 voidable on the ba sis that it was an impermissible prefe rential tra nsfer under the Ba

nkruptcy 3 Code. I d. On appe al, this Court affirmed the judgme nts of the district court a nd bankruptc y 4 court re

jectingthe debtor’ s pref

ere ntial-transfe r ar gument. This Court ag ree d with the lower 5 c ourt s th at th e de bto r c ou ld n ot v oid the pr e -p e tit ion

a ssi g nme nt o f t

he pa rt ia l ju dg me nt b e c a

us e 6 “ the a ssi g nme nt o f a n e xistin gjud g me nt c re ate s a n imme diate lie n in

fa vo r o f t he a ssi g ne e that is 7 valid ag ainst later lien c reditors of the assig nor.” 498 F .2d at 838. This Court determined that 8 under N .Y. Gen. O blig. L aw § 13- 103, the “a ssignment of a judg ment operates as a tr ansfe r of [a] 9 prese nt rig ht to the judgment, subjec t though it may be to def easa nce on a ppeal, a nd of the 10 residual r ight to the unde rlying c ause of action in the eve nt of a re versa l or vac ation of the 11 judgme nt.” I d. at 839. 12 We theref ore he ld that the assig nment of the pa rtial judg ment in L aw Rese arc h cre ated a 13 lien that was c ontemporane ously perf ecte d at the time it was assig ned on F ebrua ry 1, 1971, and, 14 thus, was not voidable under the B ankruptc y

Code. I d.; cf. Kla

r v. B achr ach ( In re Mode ll), 71 15 F .2 d 1 48 , 1 49 (2 d Ci r. 19 34 ) ( ho ldi ngthat an a g re e me nt t o a ssi g n a n inte re st i n “ any

ve rd ic t, 16 decision, judg ment, or proc eeds the reof ” that the a ssignor

might re cover

in a pendingsuit does 17 not constitute the assig nment of a pr esent intere st). A pre sent interest in an e x isting judg ment 18 was a ssigne d in L aw Rese arc h, but the Security Ag ree ment in this case fa iled to transfe r such a n 19 interest to Rosly

n. Instead, the Sec urity

Ag ree ment pledg ed only future mone y

rec eived or 20 re c ov e ra

ble fr om t he USF & G a

nd USP S Judg me nts

. 21 CO NC LU SION 22 Acc ording ly , we VA CATE the Orde r of the D istrict Court and rema nd the ca se for 2 3 p ro ce ed i n gs co n s i s t en twi thth e f o re go i n g.