[*1]

During the pendency of the temporary receiver's accounting proceeding, the decedent's two daughters (the petitioners), the beneficiaries of two-thirds of his estate, brought an order to show cause seeking: 1) a distribution in kind of specific parcels of the seven "Bronx properties" remaining in the hands of the temporary receiver, 2) allocation and distribution of the other assets held by the receiver, and 3) the discharge of the receiver. The decedent's son (the respondent), the former de facto fiduciary of this estate, cross-moved seeking the sale of the remaining Bronx properties by auction or as the court directs.

In the same order to show cause, the petitioners seek the totally unrelated relief of a new trial in the accounting proceeding of the respondent, as the de facto fiduciary of this estate, so that they can present proof in support of their contention that the respondent should be surcharged for the attorneys' fees they incurred during decades of litigation. Notwithstanding that the respondent's accounting proceeding was concluded more than five years ago, and that the petitioners' applications after the conclusion of that accounting proceeding to impose a surcharge for their attorneys' fees was denied on more than one occasion, at both the trial and appellate levels, the petitioners, nonetheless, contend that at this late date, CPLR 5015 (a) (2) entitles them to a new trial on this issue based upon newly discovered evidence.

At the parties' request, the motions were held in abeyance during protracted settlement negotiations. After the negotiations proved fruitless, at the petitioners' request, the court heard oral argument on the applications. After the argument, which was delayed by a death in the family of one of the petitioners' attorneys, the parties were afforded a period of time to [*2]supplement their submissions.

The petitioners submitted a letter setting forth, inter alia, the cases which they believe support their position on the attorneys' fees issue and, in a separate letter, they objected to the respondent's submission, an affirmation of counsel with exhibits, which they claim constitutes new and untimely evidentiary material in violation of Uniform Rules for Surrogate's Court (22 NYCRR) § 207.7 (e). If the court does not grant their request to disregard the respondent's submissions, the petitioners seek leave to file an additional evidentiary affidavit and further oral argument.

The exhibits attached to the respondent's submission consist of court records falling into three categories: 1) papers filed and this court's decisions in this litigation; 2) papers filed on appeals to the Appellate Division, First Department in this matter and the Appellate Division decisions and rulings thereon; and 3) additional court records from the separate litigation wherein the respondent conceded that he committed perjury during the depositions in proceedings related to this estate (see Baje Realty Corp. v Cutler, 32 AD3d 307 [2006]).

"In New York, courts may take judicial notice of a record in the same court of either the pending matter or of some other action" (Allen v Strough, 301 AD2d 11, 18-19 [2002]; see also Kingsbrook Jewish Med. Ctr. v Allstate Ins. Co., 61 AD3d 13 [2009]; Perez v New York City Hous. Auth., 47 AD3d 505 [2008]). As this court takes judicial notice of proceedings in this court and on appeal from its determinations, the court does not regard such submissions by the respondent as "additional evidentiary material." Furthermore, the petitioners' submissions on this application refer to most, if not all, of the same prior decisions in this estate at both the trial and appellate levels. With regard to the Baje Realty case (32 AD3d at 307), the arguments advanced by the respondent's counsel in his submission are similar to those he made during oral argument. Accordingly, the court denies the petitioners' request to strike the respondent's submissions insofar as those submissions refer to prior proceedings or decisions in this estate or present arguments that are similar to those made at oral argument with respect to why the petitioners' CPLR 5015 motion should be denied. On the other hand, the additional documents submitted by the respondent with respect to the Baje Realty case (id.) go beyond the additional submissions the court requested after oral argument, and will not be considered herein.

With respect to the branch of the application relating to the manner of distribution of the real property that the temporary receiver is presently managing, the petitioners contend that because of the respondent's malfeasance as the de facto fiduciary they should be granted the right to select which properties they are to receive as their two-thirds share of the estate; specifically, the two income-producing properties and one vacant parcel. The respondent counters that all the remaining Bronx properties should be auctioned by the court because the best valuation of real estate is that provided by bona fide offers to purchase. The respondent's proposal is an anathema to the petitioners because they presume that the respondent, with his decades of experience in the real estate business, would use such sales to acquire the properties by means of a nominee or undisclosed principal. They also note that this is a poor time to sell real estate and claim that such a sale would engender adverse tax consequences to them.

Clearly, a distribution in kind is the only equitable and practicable solution. Given the history of this case, there is no conceivable way in which the parties could hold the properties as tenants-in-common, and the court finds no basis for ordering the properties sold over the [*3]petitioners' objections. The respondent's management of the estate properties during the period that he was the de facto fiduciary, as well as his conceded perjury in proceedings before this court, justifies the petitioners' concern that the respondent might utilize some ploy to obtain the choice properties for less then fair market value at a time when market conditions are poor. Furthermore, it appears that the petitioners could better sustain themselves economically if they received the income from at least the "Rose Gardens" apartment house. Thus, directing distribution in kind will benefit the petitioners, and the respondent will not be prejudiced by a distribution in kind because, if he wishes to sell the properties distributed to him, he may do so. Accordingly, the branch of the petitioners' application seeking a distribution in kind is granted, and the respondent's cross motion is denied.

During oral argument, the parties agreed that the appraisals that were previously obtained were out of date and until current appraisals are obtained, it is premature to attempt to fashion an equitable distribution of the real estate. Both sides also agreed during oral argument that if the application to distribute in kind is granted, they should be given a period of time in which to agree on an appraiser and, absent such agreement, the court should select an appraiser. Accordingly, the parties have two weeks from the date of this decision to agree upon an appraiser. At the end of the two-week period they shall notify the court in writing of the appraiser that they have selected or that they cannot agree. In the latter event, the parties shall be directed to appear before the court, at which time, after consultation with the parties, the court will appoint an appraiser.

The petitioners assert that pursuant to CPLR 5015 (a) (2), they are entitled to a new trial on their damages, consisting of their counsel fees now allegedly amounting to approximately $2 million dollars. This branch of their motion is based on alleged newly discovered evidence; i.e., the respondent's bad faith and fraud as demonstrated by his admission in Baje Realty (32 AD3d at 307) that he perjured himself in depositions in this litigation, and affidavits of third parties which support the petitioners' long-standing charge that the respondent entered into a "sham" lease of the gas station located on one of the Bronx properties and controvert the respondent's claim that he did not control the gas station property. Although the petitioners do not deny that the Appellate Division, First Department previously ruled on their attorneys' fee application (see Matter of Sakow, 45 AD3d 314 [2007]), they argue that the "new evidence," allegedly discovered after that appeal concluded, requires an examination once again of their request for attorneys' fees in what they incorrectly characterize as the court's "prior intermediate order."

The respondent alleges that the new evidence is not "newly discovered" as he admitted his perjury in a March 11, 2004 affidavit submitted in Baje Realty (32 AD3d at 307), which was prior to the petitioners' first unsuccessful motion on this issue filed with this court in June, 2005, seeking an order directing the reimbursement of their attorneys' fees (Matter of Sakow, NYLJ, Aug. 2, 2005, at 24, col 4). He asserts all other records with regard to Baje Realty are a matter of public record and, with the exercise of due diligence, could have been discovered by the petitioners years prior to their instant application. The respondent also contends that in light of the petitioners' failure to produce any proof at the long-ago concluded trial, their alleged newly-discovered evidence, by itself, clearly would not have produced a different result at that trial.

The respondent's alternate argument is that in any event, the petitioners cannot recover the attorneys' fees they incurred because under the American rule prevailing parties cannot recover [*4]counsel fees from their unsuccessful adversaries absent a statute or contractual provision providing to the contrary (see A.G. Ship Maintenance Corp. v Lezak, 69 NY2d 1 [1986]). The petitioners counter that the surcharge for the attorneys' fees that they seek to impose against the respondent is simply an extension of the rule that a fiduciary is liable to an estate and its beneficiaries for misconduct which damages them (see Matter of Rose BB, 16 AD3d 801 [2005]; Matter of Marsh, 265 AD2d 253 [1999], lv denied 95 NY2d 956 [2000], cert denied sub nom. Lefkowitz v Bank of New York, 532 US 1038 [2001]; Matter of Campbell, 138 AD2d 827 [1988]; Parker v Rogerson, 49 AD2d 689 [1975]; Matter of Buxton, NYLJ, Oct. 13, 2006, at 32, col 3). The respondent argues that the cases relied upon by the petitioners are not controlling on the following alternative grounds: they were decided prior to A.G. Ship Maintenance Corp. v Lezak (69 NY2d at 1); or there was an applicable statute which created an exception to the American rule; and in any event, none of those cases support awarding attorneys' fees in favor of a beneficiary rather than the estate.

Pursuant to CPLR 5015, a party seeking to vacate a judgment or order upon the ground of newly-discovered evidence must establish that such evidence "would probably have produced a different result" in the original proceeding (CPLR 5015 [a] [2]; American Comm. for the Weizmann Inst. of Science v Dunn, 10 NY3d 82, 95-96 [2008]). The movant has the burden to submit sufficient evidence supporting the grant of such relief (see Matter of Gough, 59 AD3d 998, 999 [2009]; Matter of Commissioner of Social Servs. of Ulster Co. v Powell, 39 AD3d 946, 948 [2007], appeal dismissed 9 NY3d 975 [2008]), and must also demonstrate that the newly discovered evidence is material, not merely cumulative, and not of such a nature as would merely impeach the credibility of an adverse witness (see Matter of Catapano, 17 AD3d 673, 674 [2005]; Olwine, Connelly, Chase, O'Donnell & Weyher v Valsan, Inc., 226 AD2d 102 [1996]). While there is no stated time limit on a motion to vacate based upon newly discovered evidence (or fraud), the movant must show that the evidence could not have been discovered in time to move for a new trial under CPLR 4404 (see Prote Contr. Co., Inc. v Board of Educ., 230 AD2d 32, 39 [1997]; Structural Concrete Corp. v George Campbell Assoc., Corp., 224 AD2d 516 [1996]), and must expeditiously present the alleged new evidence upon its discovery (see Matter of Commissioner of Social Servs. of Ulster Co. v Powell, 39 AD3d at 949; Martocci v Bowaskie Ice House, LLC, 31 AD3d 1021 [2006], appeal dismissed 7 NY3d 916 [2006], cert denied __US__, 128 S Ct 277 [2007]).

The history of this case militates against the petitioners' request for a new trial so that they may present proof in support of imposing a surcharge against the respondent for attorneys' fees. The fact that the petitioners now seek to present proof at trial is an implicit, if not explicit, concession that they should have presented whatever proof was available to them to support this surcharge at the original trial. However, the petitioners failed to present any proof on this issue, or any other issue, at the trial in the de facto fiduciary accounting proceeding, and their subsequent request for this identical relief has been denied more than once at both the trial and appellate levels. Specifically, even though the petitioners herein, who were the objectants in the accounting proceeding, failed to offer any proof at the trial in the accounting proceeding, the court rejected the de facto fiduciary's account and awarded a remedy therein which did not include a surcharge in favor of any party for attorneys' fees (Matter of Sakow, NYLJ, April 16, 2004, at 26, col 4, affd in part, mod in part 21 AD3d 849 [2005], lv denied 7 NY3d 707 [2006]). [*5]Thereafter, when the petitioners herein sought to impose additional surcharges against the de facto fiduciary, this court denied the application on the ground that they "had the opportunity to present evidence at the trial on their objections to the account and the accounting proceeding was concluded when the court rendered its decision and order on April 13, 2004" (Matter of Sakow, NYLJ, Aug. 2, 2005, at 24, col 4, affd 45 AD3d 314 [2007], rearg denied 2008 NY Slip Op 62568 [U][2008]). The Appellate Division, First Department denied the petitioners' request for a surcharge against the de facto fiduciary for the attorneys fees that the petitioners incurred to establish his wrongdoing and stated:

"As the damages trial of this matter was concluded, and the resulting order reviewed by this Court (see Matter of Sakow, 21 AD3d 849 [2005], lv denied 7 NY3d 706 [2006], the doctrine of the law of the case precludes the grant of objectants' cross motion to surcharge petitioner for self-dealing (see generally People v Evans, 94 NY2d 499, 502-504 [2000]" (Matter of Sakow, 45 AD3d at 314).

Assuming, arguendo, that at the time of the trial in the accounting proceeding the petitioners did not know and could not with the exercise of due diligence have discovered either the evidence of the respondent's perjury or his self dealings with the tenants of the gas station on Bartow Avenue, they failed to establish that this "newly-discovered evidence" would probably have produced a different result at the very trial at which they failed to offer any evidence on this or any other issue. Although perjury may not be condoned, the respondent's admission that he concealed his ownership interest in Baje Realty, by itself, does not entitle the petitioners to any relief with respect to their objection seeking to impose a surcharge to compensate them for the attorneys' fees that they paid. The respondent acquired his interest in Baje Realty decades after the decedent's death, and no proof was ever offered to establish that he used any estate assets to purchase this realty. Furthermore, the petitioners' right to an interest in the Baje Realty property is not at issue in this application. Of even greater significance with respect to the requested attorneys' fee surcharge, is that insofar as the respondent's conceded perjury is relevant to proving his deceptive conduct, it is cumulative, as on several occasions prior to this application both this court and the Appellate Division, First Department noted examples of the respondent's deceptive practices.

Notwithstanding the petitioners' continued mantra that they were unfairly prevented from offering proof at the damages phase of the trial due to no fault of their own, the record reflects that they were given ample notice and every opportunity to proceed with their proof and, after specific warnings, they decided against presenting any evidence at trial and did not even follow this court's explicit instructions for obtaining a continuance, a finding affirmed by the Appellate Division, First Department (see Matter of Sakow, 21 AD3d at 849-850). Moreover, the respondent's "over 40 years of self-dealing and deception," as evidenced by his production of documents "only when production could no longer be circumvented, and even then, only those documents that appeared to favor his position" (id. at 850), were known at the time of the trial and appeal and, therefore, all inferences were drawn and doubts resolved against him, notwithstanding the petitioners' failure to proceed at trial. Specifically, the petitioners were awarded an interest in nine parcels of realty, two of which were sold by the temporary receiver, because the court rejected the de facto fiduciary's account even though the petitioners failed to present any proof at the trial. Two of the reasons for the significant legal fees incurred by the [*6]petitioners are the amount at stake in light of the multi-million dollar value of the parcels of realty, and as is the case with this branch of their application, their requests on more than one occasion that this court and the Appellate Division, First Department revisit identical issues.

This court's prior ruling that the petitioners were obligated to prove which real estate assets were traceable to the estate remains the law of the case (see Duckett v Wilson, 31 AD3d 865 [2006]; Miller v Schreyer, 257 AD2d 358 [1999]; see also People v Evans, 94 NY2d 499 [2000]). Consequently, the court finds that the alleged newly-discovered evidence was merely cumulative on the issue of the respondent's deceptive course of conduct, and in light of the petitioners' failure to present any evidence at trial, the newly discovered evidence, standing alone, would not have produced a different result on any issue at trial (see Matter of Catapano, 17 AD3d at 673; Ramos v 1199 House Corp., 6 AD3d 416 [2004], appeal dismissed 3 NY3d 656 [2004]; Olwine Connelly, Chase, O'Donnell & Hervalsan, Inc., 226 AD2d at 102). Moreover, the petitioners are not entitled to a new trial so that they can present other evidence, in addition to the alleged newly-discovered evidence, where such other evidence was available at the original trial at which the petitioners essentially defaulted (see Hohenberg v 77 W. 55th St. Assoc., 118 AD2d 418 [1986], lv denied 68 NY2d 604 [1986], appeal dismissed 68 NY2d 753 [1986]; see also Matter of Hunter, 4 NY3d 260 [2005]).

Accordingly, the branch of the petitioners' motion seeking relief pursuant to CPLR 5015 must be denied, regardless of whether or not their request to recover the legal fees they incurred in litigation in this estate is barred by A. G. Ship Maintenance Corp. v Lezak (69 NY2d at 1) and its progeny. The Chief Clerk shall mail a copy of this decision to respective counsel who shall then notify the court in writing within two weeks of the date of this decision as to whether they have agreed upon an appraiser.

Settle order._____________________________

SURROGATE