INTERMEDIATE ACCOUNTING OF VINCENT CHARLES SOFI AND LORRAINE SOFI PUCA AS TRUSTEES OF VARIOUS INTER VIVOS TRUSTS ESTABLISHED BY EDNA MARI SOFI AND VINCENT SOFI, Deceased
INTERMEDIATE ACCOUNTING OF VINCENT CHARLES SOFI AND LORRAINE SOFI PUCA AS TRUSTEES OF VARIOUS INTER VIVOS TRUSTS ESTABLISHED BY EDNA MARI SOFI AND VINCENT SOFI, Deceased (2008/2740/A/C; 2008/2855/A-B) — In this contested intermediate trust accounting proceeding concerning multiple intervivos trusts established by both decedents, the accounting trustees Vincent Charles Sofi (Vincent Charles) and Lorraine Sofi Puca (Puca) move for an order, inter alia: (1) pursuant to CPLR 3012, 5015 and SCPA 2206, to vacate their alleged default in the filing of their account for the Vincent Sofi inter Vivos Trust (Vincent Trust) and for leave to file their account; (2) pursuant to CPLR 2221, to renew and reargue this court's order entered October 22, 2012 upon the decision dated August 3, 2012; and, (3) vacate so much of that same order to the extent it was adverse to them (see Matter of Sofi, 36 Misc 3d 1223 [A]; 2012 NY Slip Op 51458 [U]). The granddaughters of the settlors cross-move for an order directing the trustees to immediately comply with the October 22, 2012 order.
The trustees filed their account only after compulsory accounting proceedings concluded by two separate orders dated June 25, 2009 directing them to account for all of the trusts. After they failed to timely account, a decision and order held them in contempt but afforded them the opportunity to purge themselves of contempt by accounting (see Matter of Sofi, NYLJ, Mar. 15, 2010, at 28, col 2). On March 19, 2010, the trustees filed one combined account for all of the trusts. In its August 3, 2012 decision the court determined, inter alia, that the combined account was deficient in numerous respects and granted partial summary judgment to the granddaughters and against the trustees, surcharging the trustees $299,594.18 and directing Vincent Charles to recovery title to two parcels of realty to himself and Puca, in their capacities as trustees of the Vincent Trust (see Matter of Sofi, 36 Misc 3d at 1223 [A], NY Slip Op 51458 [U]).
The trustees move, inter alia, for leave to file a new account and to reargue and renew, asserting that it was only after the granddaughters' prior motion was fully submitted that they discovered that some of the proceeds in the Vincent Trust emanated from a different trust, the Lederer Trust, whose beneficiary was Edna Sofi. They allege that the Lederer Trust lacked funds to support Edna Sofi because of an unpaid loan to the granddaughters' mother, who predeceased, and that Jane Stavola, another daughter/objectant, failed to turn over bonds belonging to that trust for many years. In support of their motion and in opposition to the granddaughters' cross motion, the movants submit voluminous financial records and a proposed account for the Vincent Trust which, they allege, demonstrates that proceeds from the sale of the subject properties in the Vincent Trust were spent for Edna Sofi's benefit. Among their claims are that their prior counsel, who they allege also represented Edna Sofi, oversaw the sale of properties in the various trusts, and prepared a combined account to cover up counsel's own questionable advice. The movants also allege that they timely turned over to their former attorneys all documents necessary to prepare an accurate account and respond to the granddaughters and Stavola's discovery demands, and any deficiencies in the account and failure to respond to discovery demands was occasioned by former counsel, against whom they have commenced separate proceedings in another forum.
In opposition to the trustees' motion and in support of their cross motion, the granddaughters and Stavola note that the trustees submitted the combined account only after they evaded service of process for many months in the compulsory accounting proceedings, were held in contempt, and had ample opportunity to oppose their summary judgment motion seeking a surcharge. They urge that there are no new facts that would change the prior determination and no reasonable justification for the trustees' failure to present these facts on the prior motion. As there were years of motion practice, they contend that it is inconceivable that the trustees were unaware that their combined account was deficient, and they note that the new proposed account for the Vincent Trust also fails to include proceeds of safe for properties omitted from the combined account. They assert that there were various other improprieties by one or both trustees during disclosure, the trustees never repaid substantial loans from the trusts, and the Supreme Court, Westchester County determined that Puca misappropriated assets from the Lederer Trust and directed her to pay $150,000 to the granddaughters.
The trustees reply that their new account shows how all of the proceeds were used, they complied with the October 22, 2012 order to the fullest extent possible, but do not have the ability to pay the $300,000 surcharge.
As a preliminary matter, as a combined account was previously submitted and is the subject of the prior motion and the motion at issue, there was no prior default and the branch of the motion seeking to vacate an alleged default is denied. A motion to reargue must be based upon matters of fact or law allegedly overlooked or misapprehended by the court in determining the prior motion, but shall not include any matters of fact not offered in the prior motion (see CPLR 2221 [d] ; 15 E. 63 St. Co. v. Cook, 120 AD2d 442 ). A motion to renew must be based upon new facts not offered on the prior motion that would change the prior determination or shall demonstrate that there has been a change in the law that would change the prior determination (see CPLR 2221 [e] ; 15 E. 63 St. Co. v. Cook, 120 AD2d at 442 ; Foley v. Roche, 68 AD2d 558, 567 ). In addition, the motion to renew shall contain a reasonable explanation for the failure to present such facts on the prior motion (CPLR §2221 [e] ). Here, the trustees concede that they possessed all of the necessary documentation to furnish complete accounts of their proceedings, they verified the combined account and they retained counsel with authority to do all acts incidental to the prosecution and management of the proceedings, and that authority included the submission of the verified combined account to purge themselves of contempt. Therefore, the trustees are bound by their own acts and the acts of their attorneys, and the deficiencies in the combined account cannot be excused by claims of reliance on counsel to properly prepare the trust accounting (see U.S. v. Estate of Boyle, 489 U.S. 241, 250 ; Gourary v. Gourary, 94 AD3d 672 ; Katzenberg v. Satz, 129 Misc 218 ). As a result, the trustees are not entitled to file a new account (see Hohenberg v. 77 W 55th St. Assoc., 118 AD2d 418 , lv denied, 68 NY2d 604 , lv dismissed, 68 NY2d 753 ). Accordingly, the remaining branches of the motion seeking leave to file a new account and to renew and/or reargue the prior decision of this court are denied and for the same reasons, the branch of the motion seeking to vacate the portions of the order that are adverse to the movants is also denied.
The granddaughters' cross motion is granted, and the trustees are directed to immediately comply with the order entered October 22, 2012 directing them to deposit $299,594.18 in their present counsel's escrow account, to be thereafter distributed pursuant to the terms of the Vincent Trust.
This decision constitutes the order of the court. The Chief Clerk is directed to mail a copy of this decision and order to respective counsel.
February 4, 2013