Appeal from a judgment of the Civil Court of the City of New York, Queens County (Richard G. Latin, J.), entered December 9, 2010. The judgment, after a nonjury trial, dismissed the complaint and awarded defendants the principal sum of $76,500 on their counterclaim based on a liquidated damages clause.

ORDERED that the judgment is affirmed, without costs.

In this action, commenced in the Supreme Court, Queens County, and transferred to the Civil Court, Queens County, pursuant to CPLR 325 (d), plaintiff seeks to recover a down payment in the sum of $38,500, for the purchase of real property owned by defendant Amelia P. Buno, which sum plaintiff had deposited with defendant Law Offices of Davidov & Davidov, P.C. as escrow agent. Pursuant to paragraph 8 (b) (i) of the contract of sale dated July 11, 2007, plaintiff had 45 days from the date a fully executed copy of the contract of sale was given to her or to her attorney to obtain a mortgage commitment in the sum of $535,000; otherwise, plaintiff was required to notify the seller of her inability to obtain a mortgage commitment and cancel the contract, or request an extension of time in which to obtain a commitment. Plaintiff was required to "make prompt application" to an institutional lender, or submit an application to a mortgage [*2]broker registered pursuant to article 12-D of the New York Banking Law provided that the broker promptly submit such application to an institutional lender. The contract of sale also contained a liquidated damages clause entitling the seller to 10% of the purchase price in the event of the buyer's default. Defendants counterclaimed to recover, among other things, the sum of $76,500, representing 10% of the purchase price.

At a nonjury trial, plaintiff testified that she had met with a mortgage broker named Tapan Laskar, who had her sign a mortgage application form from Jrl Equities, Inc. sometime in "July or August," reflecting a mortgage in the sum of $650,250. An employee of National City Mortgage, an institutional lender, testified that, while an application had been furnished to National City Mortgage on September 9, 2007, he did not know of the Jrl Equities, Inc. application, and he did not have with him at trial plaintiff's application upon which he had based his determination to deny the mortgage commitment. Moreover, he did not recall reviewing an application. On September 11, 2007, after the 45-day period in which plaintiff was required to obtain a mortgage commitment had elapsed, he issued a letter indicating that plaintiff's application for a mortgage in the sum of $535,000 had been denied due to her credit history. Plaintiff further testified that her subsequent request for the return of her down payment was refused by defendants. The Civil Court entered judgment dismissing the complaint and awarded defendants the principal sum of $76,500, representing 10% of the purchase price.

Plaintiff's proof adduced at trial failed to establish that she had submitted a timely, proper mortgage application with a mortgage broker since, among other things, the Jrl Equities, Inc. application form was for an improper amount, in that it exceeded the sum of $535,000 (see Post v Mengoni, 198 AD2d 487 [1993]; Silva v Celella, 153 AD2d 847 [1989]). Moreover, plaintiff failed to establish that there had been a "prompt application" to obtain a mortgage commitment from an institutional lender since plaintiff's witness, an employee of the institutional lender, National City Mortgage, testified that he had not received plaintiff's application until September 9, 2007, which was after the 45-day period in which plaintiff was required to obtain a mortgage commitment had elapsed. Additionally, plaintiff failed to notify the seller within the 45-day period of her inability to obtain a mortgage commitment, and there was no evidence adduced at trial establishing that plaintiff had requested or received an extension of time in which to obtain a mortgage commitment. In view of the foregoing, we find that plaintiff did not establish her entitlement to a return of the down payment (see Maxton Bldrs., Inc. v Lo Galbo, 68 NY2d 373 [1986]; Vafa v Cramer, 212 AD2d 593 [1995]; Hendel v Scheuer, 150 AD2d 431 [1989]; Levine v Trattner, 130 AD2d 462 [1987]). Rather, the proof establishes that plaintiff defaulted under the terms of the contract, thereby entitling defendants to a judgment in the sum of $76,500 on their counterclaim.

Accordingly, the judgment is affirmed.
Rios, J.P., Weston and Aliotta, JJ., concur.
Decision Date: July 12, 2013