The following papers numbered 1 to 11 were read on this motion by the plaintiff, Steven Georgilis, for an order pursuant to CPLR Article 63 staying defendant Corning Federal Credit Union from recording or enforcing a Deed in Lieu of Foreclosure with respect to the real property located at 88 Helena Drive, South Hempstead, New York:

Papers

Plaintiff commenced an action to obtain a preliminary and permanent injunction enjoining Corning Federal Credit Union from recording a Deed in Lieu of Foreclosure with respect to the real [*2]property owned by Shenaz Georgilis; enjoining Corning Federal Credit Union from recording or taking any steps to enforce a certain Mortgage Term Promissory Note; and enjoining defendant from taking any steps to enforce a certain Commercial Term Loan Note and Security Agreement. In addition, plaintiff seeks to recover damages for fraud, conversion, deceptive acts and practices, breach of covenant of good faith and fair dealings, and pecuniary loss in the amount of 200 million dollars. The plaintiff commenced this action by filing a summons with notice on November 21, 2014. However, plaintiff has not yet served a complaint despite a demand for same served by Davidson Fink LLP attorneys for the defendant.

In support of the application for a preliminary injunction, the plaintiff, pro se, submits an affidavit dated November 20, 2014, stating that he is the President and sole shareholder of American Made Tires Inc. He states that in December 2009 he sought to purchase the assets of a tire re-mould factory in Elmira Heights, New York and incorporated his own business known as American Made Tires, Inc. (AMT). He applied to Corning Federal Credit Union (Corning) for a commercial loan. The commitment he received required a lien to be placed on the factory equipment, required a personal guarantee from Steven Georgilis and his wife Shenaz Georgilis and required a mortgage on his residence in South Hempstead. Title to the residence is in the name of his wife, Shenaz Georgilis. He states that the closing on the loan took place on July 20, 2010. At that time he borrowed a total of $500,000 from Corning in the form of $150,000 Commercial Loan, and a $350,000 SBA Express Loan. At the time of the loan Corning was granted a Security Agreement in certain collateral as well as the unconditional personal guarantees of Steven and Shenaz Georgilis and mortgages totaling $340,000 on realty located at 588 Helena Drive, Hempstead, New York. Plaintiff signed a "Mortgage Term Promissory Note" for the $150,000 and a Commercial Term Loan Note for the $350,000.

The plaintiff asserts that Corning did not provide valuable consideration to either his company, AMT, Shenaz or to himself. He claims that in issuing a two-party check for $350,000 payable to AMT and Rule Transfer, Inc., Corning did not provide AMT with the consideration agreed upon in the Commercial Term Loan Note and Security Agreement. He contends that because he did not receive valuable consideration as agreed upon, the notes, mortgages and security agreements are neither valid nor enforceable.

It is alleged that the plaintiff defaulted on his loans commencing on October 16, 2014. Corning sent AMT a Notice of [*3]default on October 27, 2014 stating that Corning intends to exercise its rights pursuant to the default including recording the deed to the residential property.

Plaintiff now seeks a preliminary injunction enjoining Corning from recording the Deed in Lieu of Foreclosure pending the determination of the action. Plaintiff contends that there is a likelihood he will succeed on the merits because the Loan Notes, Security Agreements, and Mortgages should be rendered void because AMT did not receive valuable consideration. He states that he will suffer irreparable harm if the deed is recorded as he will lose possession of his property in South Hempstead and he will be unjustly indebted to Corning.

Defendant, Timothy Montanye, Coordinator of Asset Protection for Corning Credit Union, submits an affidavit in opposition to the plaintiff's application for a preliminary injunction. Mr. Montanye states that Corning is presently owed the sum of$411, 526.67 by American Made Tires and Shenaz and Steven Georgilis. He states that the obligation has been in default since Fall 2011 and has continued in default since that time. He states that the plaintiff commenced a similar action against Corning in Queens County on October 24, 2014 under Index No. 15593/2014 in which he seeks identical relief including a temporary restraining order. That motion was submitted before Justice Greco and denied by decision and order dated January 12, 2015. In addition, defendant states that Corning has an action pending against Steven Georgilis and AMT in Chemung County commenced in May 2013 for a declaratory judgment and replevin seeking to enforce its rights under the security agreement for breach of contract, for breach of the personal guarantees, and for an accounting. Defendant asserts that Mr. Georgilis is in default in said action having failed to answer the summons and complaint.

Defendant states that at the closing of the loans, AMT was advanced the sum of $500,000 and received the subject loan proceeds. He states that when plaintiff went into default in 2011, AMT filed Chapter 11 Bankruptcy in the Eastern District of New York. The Bankruptcy case was dismissed on June 11, 2013. However, during the Chapter 11 filing, Corning obtained an order from the Court with the consent of AMT, providing that Corning was owed $490,294.36 as of July 19, 2012 and that all of the loan documents are valid, binding, and enforceable including the security agreement. On April 23, 2013, Corning was granted an order allowing it to enforce its security interest in the collateral.

On January 24, 2013, Corning was granted a conditional order of seizure by Justice O'Shea in Chemung County Supreme Court. The order provided that Mr. Georgilis would make monthly payments and upon a default the Order would go into effect. On December 18 2013, AMT filed a second Chapter 11 Bankruptcy which was dismissed on August 1, 2014. During the course of that Bankruptcy proceeding, guarantor, Shenaz Georgilis, granted to Corning a Deed in Lieu of Foreclosure for the Hempstead property. Corning agreed not to record the deed as long as AMT made payments on the loan. In October 2014, plaintiff defaulted on the agreement.

Thus, defendants argue that the plaintiff's claim for an injunction is barred by the prior order of the Bankruptcy Court which found, on consent of the plaintiff, that the Corning Loan documents constitute valid and enforceable agreements and obligations and that the liens granted by the debtor are valid, binding, perfected and enforceable. In addition the debtor agreed not to assert any claim that would effect that validity of the debts owed to Corning or Corning security interests. Plaintiff also previously agreed that the balance due was $490,294.76 and that the indebtedness was due to Corning without defense of any kind

To establish entitlement to a preliminary injunction, a movant must establish (1) a likelihood or probability of success on the merits, (2) irreparable harm in the absence of an injunction, and (3) a balance of the equities in favor of granting the injunction" (Stockley v Gorelik, 24 AD3d 535 {2d Dept. 2005]; (see Matter of Advanced Digital Sec. Solutions, Inc. v Samsung Techwin Co., Ltd., 53 AD3d 612 [2d Dept. 2008]; Montauk-Star Is. Realty Group v Deep Sea Yacht & Racquet Club, 111 AD2d 909 [2d Dept. 1985]). "A court evaluating a motion for a preliminary injunction must be mindful that the purpose of a preliminary injunction is to maintain the status quo, not to determine the ultimate rights of the parties (Masjid Usman, Inc. v Beech 140, LLC, 68 AD3d 942 [2d Dept. 2009]; also see Matter of Wheaton/TMW Fourth Ave., LP v New York City Dept. of Bldgs., 65 AD3d 1051 [2d Dept. 2009]; Coinmach Corp. v Alley Pond Owners Corp., 25 AD3d 642 [2d Dept. 2006]). Further, "a party seeking the drastic remedy of a preliminary injunction must establish a clear right to that relief under the law and the undisputed facts" (Omakaze Sushi Rest., Inc. v Ngan Kam Lee, 57 AD3d 497, 497[2d Dept. 2008];also see Peterson v Corbin, 275 AD2d 35[2d Dept. 2000]).

Here, this court finds that the plaintiff has failed to show a likelihood of ultimate success on the merits by clear and convincing evidence (see Gluck v Hoary, 55 AD3d at 668 [2d Dept. [*4]2008]; Apa Sec., Inc. v Apa, 37 AD3d 502 [2d Dept. 2002]). As stated above, the plaintiff signed a consent order as part of his bankruptcy proceeding in which he agreed that AMT was in debt to Corning for $490,294.36 and that all of the loan documents are binding and enforceable including the Security Agreement. He also agreed that he would not assert a claim that would in any way affect the validity or enforceability of the debt owed to Corning. Thus, this Court finds that the basis of the plaintiff's claim herein, that he did not receive valuable consideration for the loan is without merit as the documents submitted shows that he received $500,00 in loans, and that he consented to the outstanding balance due on the loan.

Moreover, the plaintiff also has not shown irreparable injury absent the granting of a restraining order(see Di Fabio v Omnipoint Communications, Inc., 66 AD3d 635 [2d Dept. 2009]). Here the property on which the defendants seek to foreclose is rental property which is held solely in the name plaintiff's wife, Shenaz Georgilis. During the course of the bankruptcy proceedings Shenaz Georgilis granted Corning a Deed in lieu of foreclosure. Ms Georgilis is a personal guarantor of the subject indebtedness and pledged her rental property as security. Corning voluntarily agreed not to record the deed as long as plaintiff made monthly payments. The plaintiff has not disputed that AMT has failed to make the monthly payments since October 2014.

The circumstances presented in this case are not of such an extraordinary nature as to warrant injunctive relief pending the resolution of the litigation (see Village of Westhampton Beach v Cayea, 38 AD3d at 762 [2d Dept. 2007]; SHS Baisley, LLC v Res Land, Inc., 18 AD3d at 728 [2d Dept. 2005]).

In addition, this is the second application the plaintiff has filed for identical relief. As stated above, Justice Greco denied a motion seeking to enjoin Corning from enforcing the Deed in Lieu of Foreclosure under Queens County Index No. 15593/2014.

Accordingly, the plaintiff's application for preliminary relief pending the trial in this action is denied.

Dated: March 16, 2015

Long Island City, NY

ROBERT J. MCDONALD

J.S.C.