Court Opinion

ID: 9929192
Source: CourtListenerOpinion
Date Created: 2024-02-01 21:08:29.55036+00
Date Added: 2024-06-11T10:05:34.229267
License: Public Domain

Fenix Capital Funding, LLC v Phlllips Dev. & Events,
                          LLC
               2024 NY Slip Op 30325(U)
                    January 25, 2024
             Supreme Court, Kings County
        Docket Number: Index No. 535560/2022
                Judge: Francois A. Rivera
Cases posted with a "30000" identifier, i.e., 2013 NY Slip
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 This opinion is uncorrected and not selected for official
                       publication.
  FILED: KINGS COUNTY CLERK 01/26/2024 12:04 PM                                                      INDEX NO. 535560/2022
  NYSCEF DOC. NO. 22                                                                         RECEIVED NYSCEF: 01/26/2024

                                                                                       At an IAS Tenn, Part 52 of
                                                                                       the Supreme Court of the
                                                                                       State of New York, held in
                                                                                       and for the County of Kings,
                                                                                       at the Courthouse, at Civic
                                                                                       Center, Brooklyn, New York,
                                                                                       on the 25 th day of January
                                                                                       2024

               HONORABLE FRANCOIS A. RJVERA
              ----------------------------------------------------------·-------X .
               FENIX CAPITAL FUNDING, LLC,

                                Plaintiff,                                             DECISION & ORDER
                                                                                       Index No. 535560/2022
                                     -against-

              PHlLLIPS DEVELOPMENT & EVENTS, LLC /OBA:
              SOMETHING FISHY, PHILLIP WATERS
              DEVELOPMENT LLC, TERENCE D PHILLIPS,
              AND PATRICE F PHILLIPS,
                                             I

                                Defendants.
              ---------------------------------------------------------------------X
                      Recitation in accordance with CPLR 2219 (a) of the papers considered on the notice of
              motion filed on September 7, 2023, by Fenix Capital Funding LLC (hereinafter the plaintiff) for
              an order pursuant to CPLR 3212 granting summary judgment in its favor on its causes of action
              for breach of contract, unjust enrichment and fraud as asserted against defendants Phillips
              Development & Events, LLC /D/B/A: Something Fishy, Phillip Waters Development LLC,
              Terence D Phillips, and Patrice F Phillips. The motion is unopposed.

              -Notice of Motion
              -Affirmation in Support
              -Affidavit in Support
                     Exhibits A-C
              -Statement of Material Facts

              BACKGROUND

                       The verified complaint alleges thirty-four allegations of fact m support of three

              denominated causes of action. The first is for breach of contract, the second is for unjust

              enrichment and the third alleges .fraud.

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  FILED: KINGS COUNTY CLERK 01/26/2024 12:04 PM                                                     INDEX NO. 535560/2022
  NYSCEF DOC. NO. 22                                                                        RECEIVED NYSCEF: 01/26/2024

                        The verified complaint aI!eges the following salient facts. Pursuant to a receivable

               purchase agreement (hereinafter the ·agreement) and personal guaranty dated April 27, 2022, the

               plaintiff purchased from Phillips Development & Events, LLC /DBA: Something Fishy

               (herei~after Something Fishy) its future accounts receivable for the sum of$ 90,ooo:oo.

                       On or about April 27, 2022, in consideration of the sum of$ 90,000.00, Something Fishy

               sold, assigned, and transferred to plaintiff seventeen (17 %) percent of its future sales proceeds,

               up to an aggregate amount of$ I I 6, I 00.00. By the agreement Terrence D Phi II ips and Patrice F.

               Phillips executed a personal guarantee if Something Fishy defaulted.

                       On November 25, 2022, Something Fishy defaulted under the agreement by failing to remit

               its sales proceeds to the plaintiff as provided for in the agreement. In total, Something Fishy

               remitted the amount of$ 55,381.66 in accordance with the agreement, leaving a balance of$

              60, 7 I 8.34 remaining due and owing.

                       Accordingly, there is now due and payable to plaintiff, by the defendants, the princi·pal

              balance sum of$ 60,718.34, contractual default fees and penalties, and nonsufficient fund fees in

              the amount of $ 1, 150.00, together with interest from November 25, 2022, and reasonable

               attorneys' fees and costs and disbursements of this action.

              LAW AND APPLICATION

                       There is no opposition to the instant motion. However, a summary judgment motion should

               not be granted merely because the party against whom judgment is sought failed to submit papers

               in opposition to the motion, i.e. defaulted (Liberty Taxi Mgt., Inc. v Gincherman, 32 AD3d 276,

               278 n [1st Dept 2006], citing Vermont Teddy Bear Co., v 1--800 Beargram Co., 373 F3d 241 [2nd

               Cir 2004] ["the failure to oppose a motion for summary judgment alone does not justify the

               granting of summary judgment. Instead, the ... court must still assess whether the moving party

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  FILED: KINGS COUNTY CLERK 01/26/2024 12:04 PM                                                    INDEX NO. 535560/2022
  NYSCEF DOC. NO. 22                                                                       RECEIVED NYSCEF: 01/26/2024

              has fulfilled its burden of demonstrating that there .is no genuine iss~e of material fact and its

              entitlement to judgment as a matter of law"]; see Cugini v System Lumber Co., Inc., 111 AD2d

              114 [1st Dept 1985]).

                       It is well established that summary judgment may be granted only when no triable issue of

              fact exists (Alvarez v Prospect Hospital, 68 NY2d 320 [1986]). The burden is upon the moving

              party to make a prima facie showing that he or she is entitled to summary judgment as a matter of

              law by presenting evidence in admissible form demonstrating the absence of material facts

              (Guiffirda v Citibank, 100 NY2d 72 [2003]).

                       A failure to make that showing requires the denial of the summary judgment motion,

              _regardless of the adequacy of the opposing papers (Ayotte v Gervasio, 81 NY2d 1062 [1993]). If

              prima facie showing has been made, the burden shifts to the opposing party to produce evidentiary

              proof sufficient to estabHsh the existence of material issues of fact (Alvarez, 68 NY2d at 324).

                     Pursuant to CPLR 3212 (b), a court will grant a motion for summary judgment upon a

              determination that the movant's papers justify holding, as a matter of law, that there is no defense

              to the cause of action or that the cause of action or defense has no merit. Furthermore, all of the

              evidence must be viewed in the light most favorable to the opponent of the motion (Marine

              Midland Bank v Dino & Artie's _Automatic Transmission Co., 168 AD2d 610 [2nd Dept 1990]).

                       In the case at bar, the only sworn testimony submitted by the plaintiff in support of the

              motion was an affirmation of Maksim Leyvi, its counsel (herenafter Leyvi), and an affidavit of

              Alexander Ryvkin, its chief legal officer (hereinafter Ryvkin). Leyvi's affirmation demonstrates

              no personal knowledge of any of the transactional facts alleged in the complaint.     An attorney's

              affirmation that is not based upon personal knowledge is of no probative or evidentiary

              significance (Nerayoffv Khorshad, 168 AD3d 866, 867 [2d Dept 2019], citing Warrington v Ryder

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  FILED: KINGS COUNTY CLERK 01/26/2024 12:04 PM                                                     INDEX NO. 535560/2022
  NYSCEF DOC. NO. 22                                                                        RECEIVED NYSCEF: 01/26/2024

              Truck Rental, Inc., 35 AD3d 455, 456 [2d Dept 2006]). Leyvi 's affirmation states that the facts in

              support of the motion are contained in the affidavit ofRyvkin.

                         Ryvkin verified the complaint in the instant action. Neither the verified complaint nor

              the affidavit of Ryvkin averred that the agreed upon purchase price of $90,000.00 for the

              defendant's future receivables was actually paid to the defendants. Nor did the plaintiffs

              evidentiary submission demonstrate that it was actually paid. Consequently, the plaintiff did not
                     .                                                                                         .

              demonstrate its own performance pursuant to the agreement. A fortiori, plaintiff did not a make

              prima facie showing of the merchant's breach of the agreement.

              Breach of Contract

                    · The e~sential elements of a cause of action to recover damages for breach of contract are

              the existence of a contract, the plaintiffs performance pursuant to the contract, the defendant's

              breach of its contractual obligations, and damages resulting from the breach (see Cruz v Cruz,

              213 AD3d 805 [2nd Dept 2023]).

                     To prevail on the instant motion, it was incumbent upon the plaintiff to prove each of

              these elements as a matter of law. The plaintiff provided no evidence demonstrating that it

              performed its part of the agreement by paying the defendants the agreed upon purchase price.

              Consequently, the plaintiff did not meet its burden of demonstrating as a matter of law that the

              defendants breached the agreement. Inasmuch as the plaintiff did not make a prim a facie

              showing that the merchant breached the agreement, the obligation of the guarantor, was not

              triggered. As a result, the plaintiff also failed to show that the guarantor breached the agreement.

              Unjust Enrichment

                     The elements of a cause of action to recover for unjust enrichment are (I) the defendant

              was enriched, (2) at the plaintiff's expense, and (3) that it is against equity and good conscience

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  FILED: KINGS COUNTY CLERK 01/26/2024 12:04 PM                                                      INDEX NO. 535560/2022
  NYSCEF DOC. NO. 22                                                                         RECEIVED NYSCEF: 01/26/2024

              to permit the defendant to retain what is sought to be recovered (Sarker v Das, 203 AD3d 973

              [2nd Dept 2022], citing Financial Assistance, Inc. v Graham, 191 AD3d 952, 956 [2nd Dept

              2021]).

              Fraud

                        The elements of a cause of action to recover damages for fraud are a ri1 isrepresentation or

              a rnaterial omission of fact which was false and known to be false by defendant. made for the

              purpose of inducing the other party to rely upon it, justifiable reliance of the other party on the

             ,misrepresentation or material omission, and injury (Hong Qin Jiang v. Li Wan Wu, 179 A.D.3d

              1041, 1042 [2 nd Dept 2020]).

                        The plaintiffs causes of action for unjust enrichment and for fraud were both based on

              the defendants' breach of the agreement. The existence of a valid contract governing the subject

              matter of a dispute generally precludes recovery in quasi contract for events arising out of the

              same subject matter (Murtha Constr., Inc. v. Town of Southampton Haus. Auth:, 210 A.D.3d 896,

              897 [2 nd Dept 2022]). Merely alleging scienter in a cause of action to recover damages for

              breach of contract, unless the representations alleged to be false are collateral or extraneous to

              the terms of the agreement, does not convert a breach of contract cause of action into one

              sounding in fraud (Crowley Marine Assocs. v. Nyconn Assocs., L.P., 292 A.D.2d 334, 334 [2 nd

              Dept 2002]). Here, the plaintiff is claiming fraud based solely on the defendants' bn~ach of the

              agreement.

                        Consequently, the plaintiff's evidentiary s_ubmission did not make a prima facie showing

              that the defendants' were unjustly enriched at the plaintiff's expense. Nor did it plead or

              demonstrate that the defendants defrauded the plaintiff. The motion is therefore denied without

              regard to the sufficiency or lack of opposing papers (Cugini v. System Lbr. Co., 111 A.D.2d 114

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  NYSCEF DOC. NO. 22                                                                      RECEIVED NYSCEF: 01/26/2024

               [1 st Dept 1985]).

               CONCLUSION

                         The motion by Fenix Capital Funding LLC for an order pursuant to CPLR 3212 granting

               summary judgment in its favor on its causes of action for breach of contract, unjust enrichment

               and fraud as asserted against defendants Phillips Development & E_vents, LLC ID/BIA:

               Something Fishy, Phillip Waters Development LLC, Terence D Phillips, and Patrice F Phillips is

               denied.

                         The foregoing constitutes the decision and order of the Court.

              ENTER:

                                                                           J.S.C.

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