James L. Hyer, J.

Relevant Factual and Procedural Background

This matrimonial action was commenced on December 8, 2009, with Plaintiff's filing of a Summons with Notice. On June 2, 2010, an Inquest was held on the issue of the grounds for Divorce wherein the Court granted Plaintiff a divorce based upon the grounds of cruel and inhuman treatment of Plaintiff by Defendant [Colabella, N.] (hereinafter "Grounds Decision").

All issues pertaining to the parties' then minor children were resolved pursuant to Orders entered by the Court on August 12, 2011, and; October 17, 2011 [Tolbert, B.] (hereinafter collectively "Custody Decision").

On August 4, 2014, a Stipulation was placed on the record resolving all remaining issues before the Court arising out of the dissolution of the parties' marriage (hereinafter "Stipulation"). The terms of the parties' settlement included the manner of distribution of the real property known as [ . . . ] (hereinafter "Marital Domicile").

On January 2, 2015, a Judgment of Divorce was entered incorporating by reference the Grounds Decision, Custody Decision and Stipulation [Marx, P.] (hereinafter "Judgement"), which provided in part the following pertaining to the Marital Domicile:

"ORDERED, ADJUDGED AND DECREED, that the Plaintiff is hereby awarded sole ownership, title and interest in and to premises known as [ . . . ]. The Defendant shall execute a Bargain and Sale Deed with Covenants together with such other documents as may be necessary to record said deed, transferring her right, title and interest in said [*2]premises to the Plaintiff, free from any and all encumbrances which Defendant has acknowledged she has not caused to be placed against said premises. Said deed and accompanying documents shall be prepared by, or on behalf of Plaintiff and provided to Defendant for execution. Defendant shall return the signed document(s) to Plaintiff within a reasonable time, not to exceed 30 days from delivery of said documents to Defendant for signature. Said premises shall be the sole and separate property of Plaintiff; and it is further"

On April 28, 2015, an Amended Judgment of Divorce was entered by the Court [Marx, P.] consisting of the same above language pertaining to the Marital Domicile as set forth in the Judgment (hereinafter "Amended Judgment").

Thereafter, over the next decade, numerous motions were filed pertaining to the transfer of the Marital Domicile, all of which were unsuccessful in compelling the transfer of the Marital Domicile pursuant to the terms of the Amended Judgment.

On July 26, 2024, following Plaintiff's request that for Court intervention with respect to the transfer of the Marital Domicile, Ann Penachio, Esq., was appointed as Receiver (hereinafter "Receiver") in order to facilitate the transfer pursuant to the terms set forth within the Amended Judgment.

On October 3, 2024, the Receiver submitted a Receiver's Report (hereinafter "Receiver's Report"); and Receiver's Affirmation of Services and Request for Compensation For The Period From July 26, 2024 to September 24, 2024 (hereinafter "Fee Request") requesting compensation for services rendered as Receiver in the amount of $3,240.00 (hereinafter "Requested Fee").

A Status Conference was held on October 28, 2024, at 9:00 a.m., and pursuant to the scheduling Order, in person appearances required of all parties, counsel and the Receiver. At the Conference appearances were made by Plaintiff as a self-represented litigant and the Receiver, and oral argument was received with respect to the Fee Request.

In many matrimonial actions the courts are called upon to intervene when a recalcitrant spouse fails to execute real estate transfer documents pursuant to the terms agreed upon between the parties in a settlement agreement or as directed within a decision entered by the Court and in such instances one vehicle at the court's disposal is the appointment of a receiver empowered with a scope of authority permitting the actions needed to facilitate the property transfer. Here, the Court was called upon by Plaintiff to assist in the transfer of the Marital Domicile approximately ten years following the entry of the Amended Judgement and the Receiver was appointed for the sole purpose of effectuating the transfer of the Marital Domicile pursuant to the terms of the Amended Judgment.

Upon review of the Receiver's Report, the Receiver completed all duties within her scope of responsibilities as set forth in the order appointing the Receiver as the title to the Marital Domicile was transferred from the names of both parties to the sole name of Plaintiff. Accordingly, as the Receiver has completed her duties as Receiver, the receivership is hereby terminated. The Receiver shall therefore have no further duties, obligations or responsibilities as receiver in this action or otherwise to the parties arising out of the order wherein the Receiver was appointed in this action.

Turning to compensation, an award of fees to a receiver must not be made without first [*3]holding a hearing to determine the value of services rendered and the receiver's entitlement to fees for such services (Precision Synamics Corporation v. 601 West 26 Corp, 51 AD2d 907 [1st Dept 1976]). Accordingly, the Receiver and both parties were provided the opportunity to be heard prior to this Decision being entered.

With respect to the amount of compensation of the Receiver, pursuant to New York State Civil Practice Law & Rules (hereinafter "CPLR") § 8004 commissions of receivers, other than those appointed pursuant to the New York State General Business Law, are set forth as follows:

"(a) Generally. A receiver, except where otherwise prescribed by statute, is entitled to such commissions, not exceeding five per cent upon the sums received and disbursed by him, as the court by which he is appointed allows, but if in any case the commissions, so computed, do not amount to one hundred dollars, the court, may allow the receiver such a sum, not exceeding one hundred dollars, as shall be commensurate with the services he rendered.

(b) Allowance where funds depleted. If, at the termination of a receivership, there are no funds in the hands of the receiver, the court, upon application of the receiver, may fix the compensation of the receiver and the fees of his attorney, in accordance with the respective services rendered, and may direct the party who moved for the appointment of the receiver to pay such sums, in addition to the necessary expenditures incurred by the receiver. This subdivision shall not apply to a receiver or his attorney appointed pursuant to article twenty-three-a of the general business law."

Here, the commission of the Receiver must be calculated pursuant to CPLR § 8004(b) as the Receiver's Report reflects that while the Receiver completed the duties set forth within her scope of appointment, she neither collected or distributed funds during the receivership that would permit a commission to be calculated pursuant to CPLR § 8004(a). To the contrary, the Receiver's duties were limited to actions related to the transfer of the Marital Domicile which were intended by the Court not to include the collection or distribution of funds.

Therefore, the Court is permitted the discretion to fix the compensation of the Receiver in accordance with the services rendered by her and the Court pursuant to the guidelines set forth by the Appellate Division Second Department:

"Upon appointment, a receiver is generally charged with "protect[ing] and preserv[ing] the subject collateral property" (103rd Funding Assoc. v Salinas Realty Corp., 276 AD2d 340, 341). As a "general rule," a receiver is "prohibit[ed] [from incurring] expenditures beyond the" value of the "rent[s] [or revenue] collected," since "the party who moved for the receivership [generally] has no control over the receiver's expenses because the latter is an officer of the court and it would [therefore] be unfair to burden the moving party with charges beyond the amounts collected" (Litho Fund Equities v Alley Spring Apts. Corp., 94 AD2d 13, 16 [citations omitted]; see Amusement Distribs. v Oz Forum, 113 AD2d 855, 855). However, upon application of the receiver, "CPLR 8004(b) permits a court to direct the party who moved for the appointment of a receiver to pay necessary expenses and compensation which exceed the money in the receiver's hand at the termination of the receivership, [but] 'special circumstances must be demonstrated before this burden is imposed'" (Laffey v Laffey Fine Homes Intl., LLC, 192 AD3d 878, 882, quoting Long Is. City Sav. & Loan Assn. v Bertsman Bldg. Corp., 123 AD2d 840, 841). In determining whether special circumstances exist, a court possesses "discretion in [*4]ordering the payment of such additional expenses [as] accords with the equities of the situation" (Litho Fund Equities v Alley Spring Apts. Corp., 94 AD2d at 17). "[I]mportant factors for a court to consider are the degree of necessity of the expenses and the benefit received by the party who moved for the receivership" (Laffey v Laffey Fine Homes Intl., LLC, 192 AD3d at 882, citing Litho Fund Equities v Alley Spring Apts. Corp., 94 AD2d at 16; see Pondview Corp. v Russand, Inc., 132 AD3d 964, 965-966). It may be appropriate to "burden the moving party with charges beyond the amounts collected" by the receiver in circumstances where that party "either consented to or otherwise acquiesced in [the receiver's] [*3]actions knowing that the [funds available to the receiver] would be insufficient to pay for th[e] [relevant] services" or expenses (Litho Fund Equities v Alley Spring Apts. Corp., 94 AD2d at 16-17). Under such circumstances, the party who sought the receivership "is in a poor position to complain that the receivership expenses were beyond its control" (id. at 17; see Aloi v Lizeric Realty Corp., 260 AD2d 192, 193). Courts may also consider, inter alia, whether "the receivership was conducted with the utmost concern for the physical and economic preservation of the property and [whether] the money expended was 'judiciously spent' and was necessary for its preservation" (Sun Beam Enters. v Liza Realty Corp., 210 AD2d 153, 154, quoting Long Is. City Sav. & Loan Assn. v Bertsman Bldg. Corp., 123 AD2d at 841). Other factors may include whether "the receiver's application has unusual merit or whe[ther] delinquency on the part of the judgment creditor has resulted in an increase in the necessary expenses of the receivership or has precluded the collection of greater receipts" (Amusement Distribs. v Oz Forum, 113 AD2d at 856)."

(U.S. Bank N.A. v. DCCA, LLC, 2024 NY App. Div. LEXIS 5019 [2d Dept 2024])

The Fee Request submitted by the Receiver seeks a commission award to the Receiver in the amount of $3,240.00 which is calculated by the billing statements of the Receiver annexed to the Fee Request as Exhibit A. Those billing statements reflect the Receiver having engaged in 7.2 hours of services as Receiver during the receivership for which she seeks an hourly rate of $450.00 totaling $3,240.00.

This Court recognizes that a receiver appointed within the State of New York is not required to be an attorney and that the Part 36 List prepared by the Chief Administrator includes many individuals who are non-attorneys (N.Y.Ct.Rules, §§ 36.2, 36.3). However, in this instance the Receiver is an attorney who was selected by the Court in part due to her knowledge as an attorney of real estate transfers that would permit her to carry out her scope of authority as set forth in the order wherein she was appointed. Accordingly, the Court will calculate the commission due the Receiver utilizing the well-settled principles utilized by the courts in evaluating attorneys' fees.

The Appellate Division First Department has provided a clear summary of the principles to be applied by a trial court in evaluating the reasonableness of attorneys' fees:

"Contrary to appellant's contention, the law in New York relating to attorney's fees in this area is clear. The principles enunciated in Matter of Potts (supra) are applicable to conservatorships and other attorney fee matters involving the discretion of the court, not only Surrogate Court matters. The Fourth Department, there, said in part:

In general the court, in determining the justice and reasonableness of an attorney's claim [*5]for services, should consider the time spent, the difficulties involved in the matters in which the services were rendered, the nature of the services, the amount involved, the professional standing of the counsel, and the results obtained [citations omitted] (Matter of Potts, supra, 213 App.Div. at 62, 209 N.Y.S. 655).

**515 The Court of Appeals has restated the factors as follows:

Long tradition and just about a universal one in American practice is for the fixation of lawyers' fees to be determined on the following factors: time and labor required, the difficulty of the questions involved, and the skill required to handle the problems presented; the lawyer's experience, ability and reputation; the amount involved and benefit resulting to the client from the services; the customary fee charged by the Bar for similar services; the contingency or certainty of compensation; the results obtained; and the responsibility involved [citations omitted]. (Matter of Freeman, 34 NY2d 1, 9, 355 N.Y.S.2d 336, 311 N.E.2d 480.)"

(Matter of Karp, 145 AD2d 208 [1st Dept 1989]).

Based upon the submissions made to this Court, it is determined that special circumstances exist that permit a commission to be awarded to the Receiver pursuant to CPLR § 8004(b) and that the Requested Fee is reasonable and that the commission awarded to the Receiver shall be $3,240.00. The Court makes this determination after having considered the reasonableness of the Receiver's claim for services, the time spent by Receiver during her appointment, the difficulties involved in the matters in which the services were rendered by the Receiver, the nature of the services provided by the Receiver, the amount of value of the property involved in the Receivership, the professional standing of the Receiver, and the results obtained by the Receiver.

The Court must then turn to the party who should be held responsible for the Receiver's fee. Pursuant to the plain language of CPLR § 8004(b), the Court, " . . . may direct the party who moved for the appointment of the receiver to pay such sums, in addition to the necessary expenditures incurred by the receiver" (515 East 12th Street Associates v. Gentile, 160 A.D2d 187 [1st Dept 1990]; see also, Matter of Arenstein, 142 Misc 2d 491 (Sup. Ct. New York 1988]). Despite this statutory provision, courts may examine the equities to determine that a party that did not seek the appointment of a receiver be required to pay the receiver's fees (Terrastone Aubudon, L.P. v. Blair Ventures, LLC, 160 AD3d 526 [1st Dept 2018]). In this case, both parties engaged in post judgment litigation involving the contemplated transfer of the Marital Domicile for nearly a decade and the delay in this transfer necessitated the appointment of the Receiver. Plaintiff sought the appointment of a receiver and ultimately benefitted from the services provided by the Receiver. Accordingly, the Court determines that the Plaintiff must be responsible for the commission awarded to the Receiver for services rendered arising out of her appointment.

It is hereby ORDERED that:

1. The receivership is hereby terminated as the receiver has completed all duties within the scope of appointment as receiver in this action and Anne Penachio shall have no further duties, obligations or responsibilities as receiver in this action or otherwise to the parties arising out of the order wherein the Receiver was appointed in this action.

2. Anne Penachio is awarded, as and for a receiver commission for services rendered in [*6]this action as receiver, the sum of $3,240.00, which shall be paid by Plaintiff by November 15, 2024, and in the event Plaintiff fails to make payment, Anne Penachio has leave of the Court to file, with notice of settlement, a proposed money judgment for the then outstanding balance.

3. Anne Penachio shall serve, via e-mail and traceable delivery, a copy of this Decision and Order on the parties with notice of entry by November 8, 2024.

4. All prior Decisions, Orders and Judgments entered in this action shall remain in full force and effect, and to the extent any relief sought was not granted it is hereby denied.

The above constitutes the Decision and Order of the Court.
Dated: October 28, 2024
White Plains, New York
ENTER:
Hon. James L. Hyer, J.S.C.