*583In respect of the individual trustees the court finds no such malfeasance or misfeasance as warrants surcharge of either. They had confidence in the corporate trustee. They could have had no more access to the records of the interrelated companies than the general public. They are not shown to have known of the <mask> of the corporate trustee. The difficulties confronting realty managers generally during this accounting period were experienced by these trustees. No deliberate fault of the individual trustees is shown nor any personal gain by them.- No surcharge will be imposed on them. In denying the- request of objectants that the individual trustees be surcharged the court has not passed upon their right to receive commissions nor passed upon the question whether their derelictions or inactivities as trustees warrant denial of commissions to them in whole or in part. All of those questions have been reserved for further hearing when the decree is noticed for settlement.


*451The second duty of impartiality which on occasion requires an equitable adjustment as the result of a tax election is, as observed above, foreclosed here by statute (EPTL 11-1.2, subd [B], par [1]). The third duty to refrain from <mask> acts (Meinhard v Salmone, 249 NY 458, 464; Matter of Rothko, 84 Misc 2d 830, mod 56 AD2d 499, affd 43 NY2d 305; 2 Scott, Trusts [3d ed], § 170.25) should bar a fiduciary who is also a beneficiary from making a tax election unfairly favoring his beneficial interest over that of another beneficiary (Carrico & Bondurant, op. cit., p 546). Such a course would prohibit all three children from exercising any discretion on the election, leaving Mr. Harnett, who at least to some extent concedes the magnitude of a problem probably no one, much less the testator, could foresee.


The standard of review applied to the actions of a residential cooperative corporation, the common-law business judgment *29rule, requires courts to “defer to good faith decisions made by-boards of directors in business settings” (40 W. 67th St. v Pullman, 100 NY2d 147, 153 [2003]). The rule applies “[s]o long as the board acts for the purposes of the cooperative, within the scope of its authority and in good faith” (Matter of Levandusky v One Fifth Ave. Apt. Corp., 75 NY2d 530, 538 [1990]), that is, consistent with the powers authorized by the bylaws and proprietary leases, where there is “a legitimate relationship between the Board’s action and the welfare of the cooperative” (Pullman, 100 NY2d at 156), and where there is no evidence of “bad faith, arbitrariness, favoritism, discrimination or malice on the cooperative’s part” (id. at 157). Accordingly, it must first be determined whether the cooperative’s action “was authorized, made in good faith, and in furtherance of the [cooperative’s] legitimate interests,” and then whether the tenants “raise [d] a triable issue of fact with respect to fraud, <mask>, or other misconduct by the [cooperative] which would trigger further judicial inquiry” (Walden Woods Homeowners’ Assn. v Friedman, 36 AD3d 691, 692 [2007]; see also Oakwood On The Sound, Inc. v David, 63 AD3d 893, 894 [2009]; Levine v Greene, 57 AD3d 627, 628 [2008]; Martino v Board of Mgrs. of Heron Pointe on Beach Condominium, 6 AD3d 505, 506 [2004]; Gillman v Pebble Cove Home Owners Assn., 154 AD2d 508, 508-509 [1989]). “ ‘[C]onclusory and speculative allegations of bad faith, self-dealing, and other wrongdoing’ ” will not suffice to raise a triable issue of fact (Molander v Pepperidge Lake Homeowners Assn., 82 AD3d 1180, 1183 [2011], quoting Bay Crest Assn., Inc. v Paar, 72 AD3d 713, 714 [2010]).


Very recently I have held in Matter of Rothko (69 Misc 2d 752, affd 40 AD2d 1083) that this court has jurisdiction to set aside contracts made by executors to sell the major substance of estate assets to nonfiduciaries and to adjudicate whether or not restitution ought to be made by the nonfiduciaries if the contracts were found, as alleged, to have been made as a result of <mask> or fraud. An injunction pendente lite was also granted forbidding the nonfiduciary contractors from selling or disposing of the property without court permission (Matter of Rothko, 71 Misc 2d 320, affd 40 A D 2d 965).


Basically the charge of the petition is that this executor, with the knowledge and cooperation of his coexecutors, became involved in a <mask> situation with corporations of at least one of which he was an officer and director. The contention in the petition is that the executors and the two respondent corporations entered into a conspiracy to defraud the estate through the execution of contracts which were profitable to the contracting parties but financially injurious to the estate.


Thomas Neary, Salvatore Benevento, and Carmel Salerno’s first counterclaim demands a judgment directing 363-367 Neptune Avenue, LLC to issue and deliver renewal leases to them in accordance with the Rent Stabilization Law of 1969 (Administrative Code § 26-501 et seq.). Thomas Neary, Salvatore Benevento, and Carmel Salerno’s second counterclaim seeks rescission of the Operating Agreement and conveyance of their respective ownership interests in the premises based upon alleged fraudulent inducement. Thomas Neary, Salvatore Benevento, and Carmel Salerno’s third counterclaim requests damages based upon 363-367 Neptune Avenue, LLC’s alleged fraud, deceit, breach of fiduciary duty, <mask>, and waste. Thomas *788Neary, Salvatore Benevento, and Carmel Salerno’s fourth counterclaim seeks an accounting. 363-367 Neptune Avenue, LLC has interposed a reply to the counterclaims.


The concept of a de facto executor or trustee has long been recognized under New York law (Mills v Mills, 115 NY 80; Matter of King, 194 AD2d 726, affg NYLJ, Feb. 11, 1992, at 26, col 2; Matter of Behr, 191 AD2d 431; Matter of Sakow, 146 Misc 2d 672, supra; Matter of Dakin, 58 Misc 2d 736; Matter of Lewin, 41 Misc 2d 72, 75; Matter of Wohl, 36 NYS 2d 926; Matter of Lasser, NYLJ, June 4, 1986, at 13, col 3). An executor "de son tort” is defined in Black’s Law Dictionary 403 (5th ed) as a "person who assumes to act as executor of an estate without any lawful authority, but who, by his intermeddling, makes himself liable as an executor to a certain extent.” The Court of Appeals stated in Katzman v Aetna Life Ins. Co. (309 NY 197, 202) that "[t]he power of the court to treat a wrongdoer as a trustee de son tort or ex maleficio is *707beyond question.” The result of finding that a person has assumed the mantle of a fiduciary under one of these theories has been broadly stated to be that the de facto fiduciary may be held liable to account and presumably surcharged for <mask> on the same basis as any other fiduciary (Matter of King, supra; Matter of Sakow, supra; Matter of Lasser, supra). However, the criteria which must be met to bring a party within the purview of the de facto principle has not been clearly enunciated, probably because most of the decisions on the subject have been rendered in the context of motions for summary judgment or to dismiss, a stage in the proceeding when the party relying on the concept is given every conceivable opportunity to prove that a person has exerted effective control over assets of a trust or estate to an extent which renders him or her as responsible as a de jure fiduciary. If there is any doubt, the motion to dismiss must be denied (Matter of Behr, supra).


Consequently, Mosionzhnik must pay the $500,000 in kickbacks to the Gallery because “fiduciaries must disgorge all wrongful benefits obtained by their disloyalty.” (212 Inv. Corp. v Kaplan, 16 Misc 3d 1125[A], 2007 NY Slip Op 51577[U], *9-10 [Sup Ct, NY County 2007]; see also Excelsior 57th Corp. v Lerner, 160 AD2d 407, 408-409 [1st Dept 1990] [“where claims of <mask> and divided loyalty are presented, a fiduciary may be required to disgorge any ill-gotten gain even where the (company) has sustained no direct economic loss”], citing Diamond v Oreamuno, 24 NY2d 494 [1969].) Pursuant to CPLR 3212 (e) (2), the execution of the $500,000 judgment is stayed pending the conclusion of the trial because of Mosionzhnik’s potential setoffs (i.e., the claims not at issue on these motions, such as defamation). (See Bartfield v RMTS Assoc., 283 AD2d 240, 241 [1st Dept 2001].)


Much reliance is placed by objectants on Matter of Ryan (supra); Matter of Long Is. Loan & Trust Co. (Garretson) (supra), and Matter of Curtiss (261 App. Div. 964). We make no endeavor to distinguish in detail these decisions from the instant case other than to note that they appear to turn largely on questions of <mask>, misrepresentation, obvious inadequacy of information supplied in the account or with special circumstances not herewith presented.


The board here correctly noted that the receiver is not *271permitted to make payments on the defaulted mortgage. The receiver and mortgagee do not contend that the new "cash requirements” are insufficient for the receiver to pay for ongoing services at the building. Thus, the court need not deal with the potential of collusive <mask> where a board of directors consisting of proprietary lessees reduces the maintenance below a level adequate to pay for essential service. The motion for an injunction to prevent "modification” of the leases under Real Property Law § 259-f is denied. The stay in the order to show cause is vacated.


Tenants claim that certain of these representations were false because no part of the assessment charges received was spent on the facade repairs, that the basis of the Board’s rejection of the mortgage alternative was unreasonable and contrary to the *30cooperative’s best interests, that the facade work was premature, and that the special assessment was a pretext to balance the corporation’s operating budget. However, the broad financial management authority granted to the Board in the bylaws and proprietary leases clearly includes the determinations made by the Board, and there is no claim that any part of the funds collected from the special assessment was used for any purpose other than the furtherance of the cooperative’s legitimate interests. Whatever tenants’ claims as to the wisdom of the Board’s decisions, they are clearly authorized by the bylaws and proprietary leases. Even if, as tenants claim, the assessment served only to cure a budgetary shortfall or a depletion of the cooperative’s capital reserves as a result of ongoing facade work expenses throughout 2010, the assessment represents merely an indirect financing of the facade repairs. Absent proof sufficient to establish a triable issue of fraud, <mask>, unconscionability, or other action “taken without notice or consideration of the relevant facts” (Matter of Levandusky, 75 NY2d at 540), the Board’s decisions are insulated from judicial scrutiny by the business judgment rule. Thus, tenants failed to “overcome the presumption that the directors exercised their honest judgment to promote the lawful and legitimate interests of the corporation” (Horwitz v 1025 Fifth Ave., Inc., 7 AD3d 461, 462 [2004]).


A fiduciary duty arises from a relationship of higher trust that creates an obligation to act for or give advice to another upon matters within the scope of the relation. (EBC I, Inc. v *829Goldman, Sachs & Co., 5 NY3d 11, 19 [2005].) It is well established that corporate directors have fiduciary duties to the corporation, including the duty of good faith, due care, and loyalty. (Matter of Levandusky v One Fifth Ave. Apt. Corp., 75 NY2d 530, 538 [1990].) As directors, both Mosionzhnik and Chowaiki had fiduciary duties to the Gallery, which they accuse each other of breaching by committing fraud and engaging in a variety of illegal <mask> schemes. These accusations fall into two categories: diversion of corporate opportunities and flat-out illegal activity. The former merits summary judgment for the Gallery. The latter, however, is barred by the doctrine of in pari delicto.


The distinction between this case and those relied upon by defendant is the presence here of the elements of criminal intent and <mask>. Here, defendant had discretion to establish the price for the fabrics. His mere selling them to the jobbers at a price below that which he might have otherwise obtained would not have constituted conversion. However, the evidence reveals that he went further than merely selling Lowenstein’s goods to the jobbers at a price below market value. He did so with criminal intent by diverting a portion of the profits realized from the resale of the goods to himself and others and, as a consequence, deprived Lowenstein of the full market value of its fabrics.


The petitioner also urges that the trust should be set aside because the trustees specifically violated the terms of the trust. Article third of the trust provides, in pertinent part, that “the Trustees are prohibited from engaging in any act of <mask> (as defined in § 4941[d])”. It is uncontroverted that by letter dated November 21, 1980, ACN and his wife as cotrustees wrote to themselves and offered to sell the assets listed in the trust agreement at the values specified in the agreement, to wit, $2,000,000. In payment, the purchasers were to give a demand promissory note with interest at 10% per annum payable quarterly to the cotrustees. On the same date, ACN and his wife, as purchasers, accepted the offer of sale and executed their acceptance of the terms of the sale.


Examination of subsequent decisions which have followed Matter of L. I. L. & T. Co. (In re Garretson), (supra) in setting aside decrees settling prior accounts for the purpose of relitigating issues raised by transactions involving <mask> discloses that the results were attained because the prior accounts either misdescribed the nature of the property, or misrepresented it, or wholly failed to disclose any fact with respect to the origin of the investment. Thus in Matter of Denbosky (245 App. Div. 93) the prior account purported to show the deposit of an amount in cash in satisfaction of a legacy, when in fact there had been invested in a mortgage certificate an equivalent amount. In Matter of Schmidt (163 Misc. 156) the investment in question was erroneously described in the prior account as an interest in a mortgage whereas the fact was that it was a whole mortgage. In Matter of Curtiss (261 App. Div. 964, affd. 286 N. Y. 716) the trustee had issued certificates of participation in whole mortgages, which it held individually, to the trusts involved. Thereafter it placed a second mortgage upon the same property, against which it issued further participation certificates, some of which it likewise assigned to the trusts. In the prior account the certificates were described as “ shares and participations in bonds and .first mortgages * * *, said shares and participations being coordinate in lien with other participations issued therein and subject to no prior interest *849* * The second, mortgage had been placed without the knowledge or consent of the certificate holders and without consolidating the two mortgages into a first lien. It was claimed therefore that the trustee had diminished the security of' the certificate holders in the first mortgage and jeopardized the investment. The certificate holders in the second mortgage contended that they participated in a subordinate mortgage instead of a prior mortgage as required by law. No disclosure of these facts was made by the account and it was properly held that the prior decree was not res judicata as to these investments. In Matter of Ryan (181 Misc. 566, affd. 264 App. Div. 704, affd. 291 N. Y. 376), cited by the respondents herein, the questioned investments in whole mortgages were described in the prior account as: “ Bd. & Mtge.” — name of mortgagor in each instance — amount of mortgage. In fact each whole mortgage had been purchased by the trustee from itself and the guarantee of its affiliate corporation obtained through the medium of bookkeeping entries, none of which was disclosed by the account, nor was any fact mentioned to put the beneficiaries on notice. Surrogate Delehauty granted vacatur of the prior decrees to the extent required to permit determination of the legality of such investments.


In Matter of L. I. L. & T. Co. (In re Garretson), (supra) the trustee purportedly assigned to the trust a whole mortgage which it held individually. Subsequently it foreclosed the mortgage through proceedings instituted in its own name and took title to the realty again in its individual name. In an accounting thereafter filed and judicially settled by decree the *848trustee merely charged itself with “ Property No. 1458 Fulton Street at foreclosure . - - - $9,106.61.’’ There was therefore not the slightest indication of the source from which the mortgage had been obtained, or from which <mask> might he inferred. Upon a subsequent accounting by the trustee the investment was attacked by the life tenant of the trust. The trustee then claimed that the life tenant had ratified the action of the trustee by reason of a report made to her by the trustee, or was estopped by the prior decree. The court in dismissing the claim of ratification held that where ratification is sought to be set up, it must appear that not only did the cestui que trust have knowledge of all the facts, but that she was apprised of her rights under the law. As to the effect of the prior decree, the court merely held that the trustee had failed to sustain the burden of establishing that the question in issue had been litigated and determined in the former proceeding. The result appears to have been reached primarily because ratification had not been established, although the further holding that the prior decree was not res judicata is unquestionably sound.


The loan by the fiduciary of the funds of her mother’s estate to herself is an act of <mask> and thus a breach of fiduciary duty. (EPTL 11-1.6.) The fiduciary has a duty of undivided loyalty. “Not honesty alone, but the punctilio of an honor the most sensitive, is then the standard of behavior.” (Meinhard v Salmon, 249 NY 458, 464 [1928, Cardozo, Ch. J.]; Parker v Rogerson, 33 AD2d 284 [4th Dept 1970]; Matter of Kinzler, 195 AD2d 464 [2d Dept 1993].)


Furthermore, CanWest has demonstrated that severe irreparable harm and the balance of equities are in favor of injunctive relief. The loss of key employees constitutes irreparable harm as a matter of law. Also, respondents are engaged in <mask> *860and a fundamental restructuring of business relationships with irreversible consequences, including shutting down the printing plant and transferring the printing business to a company owned by Azour. Independent advertising has declined, and much of the advertising in the Jerusalem Post now promotes business run by Azour. The resulting erosion of the newspaper’s goodwill and reputation also constitutes irreparable harm as a matter of law. Every day that CanWest is denied its right to participate in the ownership and management of the newspaper also constitutes irreparable harm.


A power of attorney, no matter how broadly drawn, cannot be held to encompass an authorization to the attorney in fact to make a gift to himself of the principal’s property. Such a gift carries with it a presumption of impropriety and <mask>, a presumption which can be overcome only with the clearest shewing of intent on the part of the principal to make the gift. Not having overcome this presumption, it is evident that respondent breached his fiduciary duty to the decedent when he made a gift to himself of one half of her estate.


Beyond that, we find that Ferber and Diehl engaged in inexcusable <mask>, by deliberately adjusting the preliminary values assigned by Finnegan Associates—the consulting firm retained by the Town to revalue real estate in the Town —so that their own properties, and those of their friends and relatives, were ultimately assessed well below market value, while the properties in petitioner’s development were assessed at a level that was undeniably above market value. This favoritism represents a flagrant abuse of the power conferred upon an Assessor, as well as a reprehensible breach of trust and, without more, constitutes justification for removing an Assessor from office.


Objections to said account have been filed by the executrix of the deceased life tenant and by the remaindermen. The objections, thirteen in number, are all directed at the investment by *147the trustees of $123,000 in a $650,000 mortgage on property in the city of New York. The trustees have moved to dismiss all of the objections, except two which allege <mask> and failure to disclose the same, on the ground that they are barred by a decree of this court, dated August 5, 1930, rendered in an intermediate accounting herein.


First, the trial court was presented with sufficient evidence from which to conclude that Parks did not engage in <mask>. The court heard conflicting evidence concerning the nature of the checks written, whether the checks pertained to personal or partnership interests, and whether appropriate reimbursements were made. The court weighed the conflicting evidence and found that Fudge had failed to prove that these transactions were improper. It is within the sole province of the fact-finder to weigh credibility and resolve disputed facts. Simmons v. Dixon , 96 Ark. App. 260, 267, 240 S.W.3d 608, 613 (2006). To reverse on this basis would be to require this court to act as a super fact-finder or to second-guess the trial court's credibility determination, which is not our function. Based on the evidence presented, *728we are not left with a firm conviction that a mistake was made.


While serving as a director of a nonprofit public benefit corporation called Wildlife Waystation, Margaret Summers filed this action against the Waystation and another director, Martine Colette, alleging <mask> and other misconduct by Colette. Colette and the Waystation demurred to the complaint, arguing Summers, who as a director had standing to bring this action when she filed it, lost standing when the Waystation board of directors later removed her as a director. The trial court sustained the demurrers without leave to amend.


Robert Zirinsky’s whole professional life has been spent in the family’s real estate business, first under the tutelage of his father when Robert was graduated from law school and then on *629his “own” when his father died. A variety of issues are being contested in these accountings that involve allegations of divided loyalty, <mask>, usurpation of trust opportunities, etc. There is companion litigation seeking the revocation of letters against Robert premised on his alleged violations of SCPA 711.


It is true that the sale is to be at public auction, that some other group may outbid Webb & Knapp, Inc., and thus bring in a price approaching what the minority claim is a fair price. The granting of a temporary injunction is not intended as an adjudication of the issue of bad faith consisting of alleged <mask> or special advantage, but simply and solely as a holding that sufficient has been shown to call for proof at a trial or hearing, which may be had at an early date, without prejudice to any interests involved.


It was this breach of fiduciary duty and the substantial amount of <mask> by respondent as fiduciary of the decedent which has created the intolerable conflict of interest for respondent as fiduciary of the estate. An attorney in fact, in exercising the broad powers granted to him should surely be required to turn especially sharp corners in the discharge of his fiduciary responsibilities, particularly when he stands to benefit personally from his acts or dealings. Accordingly, it is the finding of this court that respondent is ineligible to act as administrator of the estate of decedent upon the ground of improvidence under SOPA 707 (subd. 1, par. [e]) and that the letters granted him should be revoked.


The estates are entitled to an allocation to them of an award representing the underlying value of their proportionate interest in the Phelps Can Company following its liquidation. In order to restore the beneficiaries of the constructive trust to the position they would have enjoyed had there been no <mask>, they are entitled to that portion of the Phelps’ net assets which the shares of the Bellinger and Debbie estates bore to the outstanding shares of the company stock on December 31, 1966. (Scott, Trusts [3d ed.], § 516; Joseph v. Herzig, 198 N. Y. 456; Central Manhattan Props. v. D. A. Schulte, Inc., 91 F. 2d 728; Diamond v. Oreamuno, 24 N Y 2d 494; Matter of Hubbell, 302 N. Y. 246; Ann. 47 ALR 2d 176; Matter of Bolton, 121 Misc. 51; Matter of Dupignac, 123 Misc. 21; People ex rel. Union Trust Co. v. Coleman, 126 N. Y. 433.)


*858A portion of the $15,000 fee represents compensation for advice to the trust company regarding charges of wrongful conduct made against it by its cotrustee. It is said that the individual trustee charged the trust company with collusion, <mask> and concealment. Expenditures in defense against such accusations would be a proper charge to the trust estate (Matter of Bishop, 277 App. Div. 108). Other services consisted of the representation of the trust company in the action that the widow began but never pressed but the main body of services pertained to the representation of the trust company in the action instituted by the individual cotrustee. That action had not terminated when the bill for services up to September 6, 1951, was rendered and the action was still pending at the time this accounting proceeding was begun. The fact that the bill was rendered in an undetermined action precludes an appraisal of services on the basis of ultimate accomplishment or benefit. Although the trust company was a nominal defendant its interest as fiduciary was in the success of the plaintiff, its cotrustee, inasmuch as the complaint sought damages for the trustees of $96,866. The trust company had no apparent identity of interest with its codefendants. Concededly the company’s approach to the litigation was a cautious one since the company was apprehensive of a claim against it for breach of some fiduciary duty. The memorandum of the corporate trustee states that its attorneys participated in the actual trial only on occasions when it could be anticipated that an attack on the corporal e trustee might be made and at other times a junior attorney attended as an observer only. As noted before, the corporate trustee could properly retain counsel to defend it at the expense of the trust but the legal services must be valued on the basis that they were rendered for the protection of the corporate trustee and not either to augment the trust estate or to protect it from depletion. The affidavit of services covers a period expiring September 6, 1951. The action was still pending in early 1953 when the objections herein were submitted for decision. The court regards the sum of $10,000 as reasonable compensation for the services referred to in the attorneys’ bill of October 10,1951. Their disbursements are held to be proper. One half of such allowed sums is chargeable to the Lele H. Daly trust. The objections are sustained to the extent that a greater charge has been made.


Here, petitioners reason that it would be an “unreasonable or absurd application of the law” to interpret Insurance Law § 1411 (d) to permit stock repurchases that are not restricted by Insurance Law § 4105 (a)’s earned surplus test, and urge this court, as did the Santi Court, to look to the legislative intent when applying Insurance Law § 1411 (d). (Petitioners’ reply brief at 120.) The difference, however, between the instant case and the facts presented in Santi is that in the latter, the Court of Appeals concluded that Corines’ argument was based on a “fair and literal reading of the text,” while here there is nothing in the text of Insurance Law § 1411 (d) to support the argument that stock redemptions are subject to the provisions of Insurance Law § 4105 (a). Even if this court were to look to the *209legislative intent which petitioners cite, i.e., that the legislature wanted the Superintendent to have to approve stock redemptions to prevent possible <mask> by management and insiders (see petitioners’ reply brief at 120), this intention is not at odds with the plain language of Insurance Law § 1411 (d), which clearly states that “a plan of stock redemption and retirement [must be] approved by the superintendent as reasonable and equitable.” If the legislature wanted to incorporate any portions of Insurance Law § 4105 (a) into section 1411 (d), it certainly could have done so, but instead chose not to. Therefore, this court will not impose the standards set out in Insurance Law § 4105 (a) on Insurance Law § 1411 (d).


*666In each case the trustee gave prompt notice to the income beneficiary and properly earmarked the interest of this estate in the combined investment. The court finds that the trustee was not engaged in making an investment for its own account but was attempting to make an investment for the benefit of a number of estates and funds under its supervision. The court holds that the trustee was not guilty of <mask>, and that the investments were not on that ground improper.


Although the daughters have set forth seven counts in their amended objections, the allegations underlying all of their claims are that their brother, who was a law school graduate at the time of their father’s death, either in collusion with their mother or by controlling her, deceived them by telling them that their father had died intestate, leaving no assets of substantial value and that whatever assets decedent did have had been sold and used for their support and that of their mother. Movant denies that he ever deceived his sisters as to the existence of a will. However, as to the more important question of whether the decedent’s assets were sufficient to fund the daughters’ legacies, movant apparently still maintains that they were not. Objectants further contend that it was not until 1983 that one of them embarked upon an independent search and ascertained that decedent’s will had been admitted to probate. They further allege that their brother or entities or nominees controlled by him acquired many of the parcels of real property that had been owned by *674the decendent or by corporations controlled by decedent in <mask> transactions for less than full consideration. With regard to some of the properties, it is their position that movant, rather than the estate, received the proceeds. There appears to have been at least one occasion where movant held himself out to be a duly appointed agent of the estate. Objectants maintain that they have never received anything from the estate, that the decedent’s assets can now be traced to assets having a value in the millions of dollars and that they are together entitled to a four-ninths interest in all of these assets.


This action was brought by the Gebbie Foundation, Inc., (“ Gebbie ”), a New York membership corporation and charitable foundation, which is the legatee of the remainder of the entire residuary estate of one Marion B. Gebbie, deceased (“ Marion ”) and the legatee of one third of the residuary estate of one Geraldine G. Bellinger, deceased (“ Geraldine ”) against the defendants (other than Lefkowitz) in individual and fiduciary capacities, for a judgment based upon <mask> and profiting; the plaintiffs’ complaint alleging self-dealing and profiting in connection with the sale of 125 shares of stock of the defendant, Phelps Can Company (“ Phelps ”) from each .of the estates of the aforesaid decedents, and demanding that the defendants be declared constructive trustees, account, and pay over to the estates their proper share and/or the aforesaid shares of stock.


The Bill Jacket for chapter 648 of the Laws of 1975, which relates to the proposed addition of Public Health Law § 2803-c, contains a memorandum from its sponsor, Senator Karen Burstein, which summarizes the provisions of that *511statute which requires nursing homes to adopt and make public a statement of the rights and responsibilities of patients in such facilities and to treat those patients in accordance with such statement which “shall include” the patients’ “rights to adequate medical care.” The stated purpose of that proposed statute was “to establish for the care of patients in nursing home certain minimum standards” (ibid.) set forth in a patient’s bill of rights. The justification for this proposed legislation was that “no such minimum standards exist for the contract between a nursing home and its patients.” (Ibid.) The memorandum noted that according to an October 10, 1974 New York Times article “investigations of private nursing homes revealed widespread instances ‘of understaffing and underfeeding, padding of bills, kickbacks, safety violations and <mask> devices for raising medicaid rates.’ ” (Id.) In justifying the bill the memorandum went on to point out that similar legislation had been passed by other states and had been introduced on the federal level by Congressman Cohen who observed that:


The petitioner replies that questions of mismanagement, negligence and of value are foreclosed by the decision of this court which rejected all such objections to the accounts for *175periods prior to this accounting, except as to <mask>. The petitioner further contends that this method of acquiring mortgages and allocating participations to trusts or the transfer of such participations from one trust to another does not constitute wrongful self-dealing, citing Matter of Union Trust Co. (219 N. Y. 514).


The objeetants seek to surcharge the corporate cotrustee alone with the sum of approximately $360,600 and interest, for alleged negligence and even gross negligence in investing the funds of the trusts in participations of a certain mortgage and for failure to give notice to the life beneficiaries required by former section 188, subdivision 7, of the Banking Law. It was further contended that the real estate upon which the total mortgage of $2,800,000 was placed was not worth fifty per cent more than the amount of the loan, that the loan was imprudent and improvident and that it was negligently made, because there was no proper investigation or reliable appraisal of the real estate, and that the income of the *600property was insufficient to meet the carrying charges, including taxes and interest upon the loan. Other grounds of négligence, <mask> and lack of prudence in connection with the loan were asserted by the objectants. The cotrustee on the other hand contends that its officers and representatives acted in good faith and with the current exercise of prudence, vigilance and honest judgment.


The rule of law that a trustee may not deal with himself is an established standard of trust administration. When <mask> is discovered the beneficiary has the unqualified right to disaffirm the transaction and to require the return to the trust of the consideration paid. He may require the trustee to make good any damage to the trust after making due allowance for any benefits derived by the beneficiary from the transaction repudiated. The views of the court on transactions of purchase such as are here under attack are stated at length in Matter of Tuttle (162 Misc. 286). The authorities on the point are sufficiently discussed there and will not be further discussed here. The law forbidding this type of purchase being certain, the only open question is one of fact. The record here presents a very full and clear development of all the material and relevant facts.


The claim that the statute permits <mask>, it seems to the court, goes largely to a matter of policy, not of constitutionality, but at any rate it is unfounded in view of subdivision 4 of the statute and the construction placed thereon in Mullane *1014v. Central Hanover Tr. Co. (339 U. S. 306, 309) to wit, “ The trust company must keep fund assets separate from its own, and in its fiduciary capacity may not deal with itself or any affiliate.” (And see Matter of Bank of New York, 189 Misc. 459, 463.) The failure to require so-called “ documentary ” evidence of investments and transfers (objection 7) and of other notices thereof may affect the opportunity for self-dealing but do not amount to authorization thereof. They are regulatory matters only, and do not render the statute unconstitutional. The claim that self-interest will cause the trustee to pour all funds of small trusts into the common trust fund, so far as possible, may be true. Such seems to be the purpose of the statute. Insofar as operating costs are reduced, it is possible that the trustee may gain by a reduction of its own expenses, but the fund will gain also. If the fund produces a better return, the trustee will gain only insofar as it receives commissions on income in the underlying trusts (subd. 4), and reasonably high income upon diversified investments is certainly not to be condemned. The provision for a stated period of time between a decision to withdraw funds from the common trust fund and the time of actual withdrawal is for the protection of the beneficiaries and deprives no one of substantial rights. It is proper, regulatory legislation. (Veix v. Sixth Ward Assn., 310 U. S. 32.) The same is true with respect to the provisions for triennial accountings.


The following are just two examples of errors that permeate the trial court's judgment that require reversal. First, even if *827we were to credit father's testimony, father did not dispute that the floors of the cabin were unfinished and that son had finished out the cabin. Son testified that he used father's funds to finish the cabin and provided some documentation to support his contention. While the trial court was not required to fully accept and credit son's testimony that he spent all the funds to improve father's cabin, we cannot conclude, as the trial court apparently did, that son spent none of the funds to improve the cabin with the evidence presented at trial. Pictures of a beautiful, fully finished and furnished cabin were introduced at trial, and father admitted that the cabin had been unfinished before his confinement. Thus, at the very least, some of father's disputed funds must have been expended for that purpose and did not constitute <mask> or conversion as appellee alleged.


In the fifth cause it is alleged that the estate maintained an office for the administration of the affairs of the estate, at which the defendant, Travis S. Levy, was a tenant between August, 1948, and September, 1954, and used and occupied a portion of said premises with the consent and permission of the plaintiffs as his law office and utilized the services of the secretary employed by the estate and all other facilities of the office with*528out payment' whatever therefor. This additional <mask> renders the cause applicable to the 10-year Statute of Limitations and its maintenance is not barred.


The proposed trusts provide the trustees with full discretion to pay, or apply for the benefit of, any or all income and/or principal to the beneficiary during the trust period. Each trust terminates upon the respective beneficiary attaining the age of 35. Payments of principal are to be made as follows: one third upon the beneficiary attaining the age of 25 years; one half at 30 years; and the balance at 35 years. The beneficiary is granted a power to appoint the principal by a written instrument, and failing to do so, the principal is payable to his/her descendants and, if none, to the surviving sibling. The proposed trustees waive commissions. The trusts would relieve the trustees from filing a bond, establish a nonjudicial procedure for a trustee to resign and for the designation of a successor, relieve the trustees of the duty to account, and exonerate each from any liability for the acts of any other trustee. The administrative powers clauses are very broad and include the right to arbitrate any dispute, to delegate administrative duties, to remove assets outside of New York, and to engage in <mask>.


The Condominium and Cooperative Conversion Protection and Abuse Relief Act of 1980 was enacted to remedy certain abuses in conversions of rental housing into cooperative and condominium forms of ownership. Congress found that in cooperative and condominium conversions "certain long-term leasing arrangements for recreation and other condominium- or cooperative-related facilities which have been used in the formation of cooperative and condominium projects may be unconscionable” (15 USC § 3601 [a] [3]). Congressional intent under section 3607 of the Act was to protect newly formed cooperatives and condominiums from <mask> or "sweetheart” contracts entered into when the landlord or sponsor is still in control of the property. Section 3607 provides that self-*1068dealing contracts may be terminated by tenant-shareholders when they gain control of a cooperative or condominium development. (Park S. Tenants Corp. v 200 Cent. Park S. Assocs., 748 F Supp 208 [SD NY 1990]; West 14th St. Commercial Corp. v 5 W. 14th St. Owners Corp., 625 F Supp 934 [SD NY 1986].)


The Public Officers Law governs, inter alia, the appointment and qualification of public officers (see, Public Officers Law art 2) and the manner in which resignations may be tendered and *1037vacancies filled (see, Public Officers Law art 3), and it is apparent that the guidelines imposed thereunder are designed not only to establish orderly procedures but to safeguard the public trust placed in such officers. That being the case, we simply cannot accept that the Legislature intended to permit a town clerk to accept his or her own resignation. In this regard, we note that Public Officers Law § 31 (4) provides that "[a] resignation delivered or filed pursuant to this section * * * may not be withdrawn, cancelled, or amended except by consent of the officer to whom it is delivered or the body with which it is filed”. Permitting a town clerk to resign to herself under Public Officers Law § 31 (1) (g), and then vesting her with the discretion to withdraw, cancel or amend her resignation at any time she deems appropriate pursuant to Public Officers Law § 31 (4), not only leads to the confusion that resulted in this proceeding but opens the door for potential <mask> and fraud (see, 1975 Atty Gen [Inf Opns] 339).1


In his motion to strike, Glass’ counsel referred to Decker’s estimate as “<mask>.” Self-dealing is defined as “[p]articipation in a transaction that benefits oneself instead of another who is owed a fiduciary duty.” Self-dealing, Black’s Law Dictionary (11th ed. 2019). Considering that this case does not involve fiduciaries, this Court interprets “self-dealing” to mean self-serving. B. The Evidence Was Sufficient Because Fair Market Cost of Repair Includes Reasonable Profit


The early suggestion that Bruce Heilman originally intended to open a competing business at the Carter Street location, and purchase the site to lease to the new business, an allegation of some substantial credibility given that Bruce Heilman was shown to have been in deposition less than forthcoming about his Carter Street negotiations with Appelbaum, has been demonstrated to have been fully abandoned by Bruce by the time he executed the Stockwood lease and presented it to Glenn Hellman. On the current state of the negotiations and in view of the lease actually executed, Glenn Heilman offers no admissible evidence of <mask> on his brother’s part to defeat defendants’ claimed application of the business judgment rule.


The reference in the Internal Revenue Code to a fiduciary such as the bank herein being a "disqualified person” and to the "prohibited transactions” which are detailed in the said Federal statutes (Internal Revenue Code, § 4975, subd [c]) are to prevent <mask> and the commission of other intrinsically wrong acts by the trustees of such retirement funds. A direction from this court to the holder of such funds to pay over the same to a judgment creditor of the settlor cannot be considered a "prohibited transaction” by the fiduciary bank. The funds represent moneys due and payable to the settlor upon demand and are thus available for attachment by his creditors. (Pafumi v Bowery Sav. Bank, NYLJ, March 9, 1976, p 5, col 3; Lerner v Williamsburgh Sav. Bank, 87 Misc 2d 685, 689-690.)


Matter of Peck (152 Misc. 315), cited by the objectants, presented for determination an example of <mask> by a fiduciary in which the executors sought to establish ratification of the challenged acts of investment by the respondents upon the basis of their execution of an instrument of release to the *850executors in which a formal accounting- was waived. No evidence having been presented indicating that the facts regarding the purchase of the mortgages had been brought to the attention of the parties at the time of the execution of the release, the contention of the executors was overruled. The principles enunciated in Adair et al. v. Brimmer et al. (74 N. Y. 539, 554), that to establish a ratification by a cestui que trust, full knowledge of the material facts, and in an instance of self-dealing by a fiduciary, full knowledge of the legal rights possessed by the cestui gue trust, must be clearly shown, are still unquestionably the law, for the rule there formulated was indirectly approved in City Bank Farmers Trust Co. v. Cannon (supra), and again in Matter of Ryan (supra). Distinction must be drawn, however, between estoppel predicated upon ratification whether through the medium of receipt, release, informal accounting, or knowledge otherwise acquired, and estoppel arising by decree judicially settling an account. If parties who are duly cited upon an accounting do not avail themselves of the rights accorded to them by statute, do not inquire or question acts of the fiduciary which are sufficiently disclosed to them by the account to put them on notice or inquiry, and yet at a later date nlay assert objections to such previously disclosed acts' and proceedings, the benefits of judicial settlement are obliterated. Upon the entry of a decree judicially settling an account, rights of both the fiduciary and the parties in interest .vest. Such vesting of rights should not be lightly disturbed except in a proper ease under subdivision 6 of section 20 of the Surrogate’s Court Act.


*731Moreover, in view of the fact that these conversions involve the investment of entrusted assets in the trustees’ affiliated mutual funds, the loss of safeguards under section 100-c of the Banking Law is particularly troubling. In other words, the element of <mask> suggests a need for greater, not less, oversight even though the banks are authorized to make such investments. The statute conferring such authority (EPTL 11-2.3 [d]) had a well defined purpose, namely, to enable banks to compete with securities firms by allowing the banks to choose a more easily administered common investment vehicle (the mutual fund) over another available option (the common trust fund) (see Senate and Assembly Sponsors’ Mems in Support, Bill Jacket, L 1994, ch 609). The terms and history of such statute are, however, silent as to the consequence of such statutory largesse where a bank chooses to opt out of a common trust and into direct investment in an affiliated mutual fund, namely, the loss of the periodic judicial accountings that had protected the beneficiaries of the underlying trusts. Simply put, such loss appears to have been an unintended by-product of section 11-2.3 (d) and may be too high a price to pay for the salutary objective that inspired its enactment.


Plaintiff’s appeal to WHCS Real Estate Ltd. Partnership v 33 Greenwich Owners Corp. (168 Misc 2d 721) is also inapposite. That case deals with the Condominium and Cooperative *86Conversion Protection and Abuse Relief Act of 1980 (15 USC § 3601 et seq.), which permits the shareholders to terminate certain long term <mask> leases of condominium and cooperative facilities. The Act is limited to "[a]ny contract * * * which” "provides for operation, maintenance, or management of a condominium or cooperative association in a conversion project, or of property serving the condominium or cooperative unit owners in such project” (15 USC § 3607 [a] [1]). The Act has no application to holders of unsold shares of residential apartment units.


The first fundamental objection is that the trustee was guilty of <mask> in allocating to this estate a participation in a mortgage acquired by the trustee with its own funds and taken originally in its own name. The whole mortgage in which a participation was allocated to the estate of deceased was acquired by the trustee on June 2, 1931, and six days later the allocation of a share in it was made to the trust. The question is whether such allocation constituted self-dealing. The comments of this court in Matter of Balsimer (160 Misc. 906) are pertinent. There the court said in substance that if a corporate fiduciary temporarily uses its own funds to acquire mortgage investments so as to have on hand mortgages suitable for trust investments it would not be held to be guilty of self-dealing provided the investment was held in a suspense account and provided it was shown that the purpose of it was to have the asset available for the speedy investment of trust funds. That rule for trust administration has been applied in this *816court in other instances. It appears to ‘ have been called to the attention of the Court of Appeals in Marcellus v. First Trust & Deposit Co. (291 N. Y. 372). The comments of that court (p. 375) indicate that the issue is there still open because the court there said that the question was not presented on the record in the cited case. There seems to the court no reason to depart from the rule in Matter of Dalsimer (supra) and so the objection to the investment which charges self-dealing is overruled on the merits.


Nor is there evidence of <mask> motivating petitioner’s actions. It is clear that it was the consensus of the shareholders, based upon the egregious conduct of Gudas and Kagel in commencing illegal construction resulting in Department of Buildings violations to the Corporation and possibly undermining the structural integrity of the building, as well as in frustrating needed repairs and maintenance by restricting access to areas of the building, that the Gudas case needed to proceed in order to secure the ouster of these undesirable occupants. Such purpose was believed to serve the interests of the Corporation. The claim that director DeLille was unaware of the cost of the litigation is belied by the claim she submitted to the Pennsylva*1042nia liquidator containing a recitation of all legal fees as the substance of the insurance claim. (See exhibit 32.) Defendant McGrath also acknowledged filing a similar claim on or about December 31, 2003. These submissions, executed by director DeLille and shareholder McGrath, also preclude the challenge now raised to the reasonableness of the fees as both defendants implicitly endorsed the necessity and reasonableness of the fees paid in submitting the claim. Moreover, despite defendants’ argument that the fees were excessive, the bills from Gallet Dreyer & Berkey, LLP appear to average approximately $300 per hour for legal services, an hourly rate well within the standard rate at the time (exhibit 5). While the law authorizes reimbursement only for those legal fees which are reasonable and which were actually and necessarily incurred, the fact that the fees at issue are conceded to have been paid over the course of nine years of litigation, both by the Corporation and by plaintiff on behalf of the Corporation, without challenge by other directors or shareholders, forecloses the need for further proof at this time.


Delaware's business judgment rule has procedural and substantive applications. " ' "As a rule of evidence, it creates a 'presumption that in making a business decision, the directors of a corporation acted on an informed basis [i.e., with due care], in good faith and in the honest belief that the action taken was in the best interest of the company.' [Citation.] The presumption initially attaches to a director-approved transaction ... in the absence of any evidence of 'fraud, bad faith, or <mask> in the usual sense of personal profit or betterment.' " ' " (Cede, supra, 634 A.2d at p. 360, quoting Citron v. Fairchild Camera & Instrument(Del. 1989) 569 A.2d 53, 64 (Citron ).) A shareholder plaintiff challenging a board decision has the initial burden to rebut the presumption with evidence that the directors, in reaching the challenged decision, breached any one of the fiduciary duties of good faith, loyalty, or due care. (Cede, supra, at p. 361.) If a plaintiff fails to meet this evidentiary burden, the business judgment rule attaches as a substantive rule of law to protect the directors and their business decisions. (Ibid. ; Citron, supra, at p. 64.) If the business judgment rule is rebutted, the burden shifts to the defendant directors to prove the " 'entire fairness' " of the transaction to the shareholders. (Cede, supra, at p. 361.)


All plaintiff’s allegations concerning failures by Vassilakis and O’Neill to convene meetings, elect officers, collect the payments owed by the shareholders, maintain and improve the building, and issue financial statements relate to these individual defendants’ actions on behalf of CASSM Realty and its Board. (E.g. Weinreb v 37 Apts. Corp., 97 AD3d 54, 57 [1st Dept 2012].) Plaintiff has not alleged that Vassilakis or O’Neill, at least in his capacity as a corporate officer of CASSM Realty rather than a shareholder, engaged in <mask> or otherwise acted in his own interest and against the corporation’s and its shareholders’ interests. Nor has plaintiff alleged any eviden-tiary facts indicating how Vassilakis or O’Neill, as a CASSM Realty Board member and officer, acted without the Board’s authority or other than on the corporation’s behalf or any particular conduct from which conflict of interest, bias, or discrimination may be inferred. (40 W. 67th St. v Pullman, 100 NY2d 147, 157 [2003]; Matter of Levandusky v One Fifth Ave. Apt. Corp., 75 NY2d 530, 540 [1990]; Fletcher v Dakota, Inc., 99 AD3d 43, 48 [1st Dept 2012]; see Kassover v PVP-GCC Holdings II, LLC, 73 AD3d 626, 629 [1st Dept 2010].)


There are at least two possibilities for allocation of the burden, which would serve, at least in some cases, conflicting policies. There could be a presumption that the construction of the will proposed by the executor is correct, placing the burden on objectant.14 This allocation would, arguably, further the *493decedent’s general intent as demonstrated by her choice of a particular person as her fiduciary. On the other hand, where the executor herself is a beneficiary who would benefit from a particular construction, the burden might be placed on her. This would further the general principle that a fiduciary owes loyalty to all beneficiaries and may not engage in <mask>. Or, these allocations could be adopted together (i.e., burden on objectant unless fiduciary is a beneficiary under the ambiguous language; then burden shifts), thus providing greater certainty and decreasing the litigation burden on the courts.15


Barbara R. Kapnick, J. This motion was brought by order to show cause by three members of the steering committee — the AIG Entities, the Triaxx Entities and the Federal Home Loan Banks of Boston, Chicago and Indianapolis (collectively, the movants) — with the support of the State Attorneys General of New York and Delaware. The movants seek an order pursuant to CPLR 3124 compelling: (1) The Bank of New York Mellon (BNYM or petitioner or trustee) to produce communications with counsel at the June *17328, 2011 trust committee meeting; (2) BNYM to produce communications with and documents generated by counsel concerning BNYM’s evaluation of the settlement amount, including its decision to retain RRMS Advisors and to forgo a review of loan files; (3) BNYM to produce communications with and documents generated by counsel concerning its own <mask>;1 and (4) BNYM to produce one or more witnesses to testify on the above topics.


As noted above, for several generations the business of the Zirinsky family has been real estate development and management in New York City. When Ralph Zirinsky died in 1980, the gross fair market value of his real estate interests was said to amount to $1,044,036 while the net taxable estate was $463,302. At the time of Ralph’s death, Ruth was 48 years old. Robert had recently graduated from law school and had entered the family business. Robert’s entire professional life has been devoted to the family business. Under Robert’s stewardship as cotrustee of the various trusts the value of the family’s real estate interests grew over the next 25 years and today may be worth as much as $100,000,000. It is not disputed that for most of this period Robert was the dominant cotrustee as he made himself expert in the business of real estate development and management. In *628these accountings, however, his sisters allege that Robert breached his fiduciary duties to the trust and to them by longstanding patterns of <mask> and usurpation of trust opportunities in order to enrich himself and deprive them of their rightful share of the trusts.


It is alleged in the first cause of action that in July, 1951, the corporation redeemed from the owners thereof the remaining outstanding capital stock and paid therefor the sum of $268,-887.01. Thereby the estate became the owner of all of the outstanding capital stock of the corporation. On October 1, 1952, the defendant, Travis S. Levy, acquired 25% of the shares of the capital stock of the corporation issued in the name of his wife, the codefendant, at a price alleged to be grossly inadequate and which was $64,318.50 below the price paid by the estate for such interest. In this transaction it is alleged the defendant, Travis S. Levy, acted as the attorney on behalf of all of the parties. By virtue thereof, the defendant obtained financial gain at the expense and to the detriment of the plaintiffs and the estate, and breached his fiduciary obligation. Plaintiffs request that the sale be adjudged fraudulent and void, that retransfer be directed, and that the defendants be directed to account. In such an action charging <mask> and breach of fiduciary by a person in the position of a trustee, the 10-year Statute of Limitations is applicable. Since the action was commenced on February 4, 1959, and the transaction occurred in 1952, maintenance of the first cause is not barred.


Consequently, the Referee concluded, to find the proposed settlement fair, it was necessary that the parties demonstrate to him some favorable relationship between the disproportionately low settlements offered and the chance of plaintiffs’ success'. In doing so, he reached back far beyond the discovery of . the <mask> into the peculiar nature of1 the field warehousing business in which the Amexco subsidiaries were engaged.


The defendant certainly had the right to dispute the claim that the plaintiff scored 52 points. If he had done nothing more, an action for slandei would not have been thought of. Adding that the plaintiff was “bluffing, ” and had played a “bluff” game before, adds no force to the charge; nor do the additional words that it was “a <mask>, ” and that the plaintiff had swindled before, make them actionable, wnthout an allegation and proof of special damages. Chase v. Whitlock, 3 Hill, 139; Savile v. Jardine, 2 H. Bl. 531; Odiorne v. Bacon, 6 Cush. 185. The words used had reference to the score of fifty-two claimed by the plaintiff, and, in the sense employed, they were tantamount to saying that the plaintiff had claimed too much, or in other words, that the claim was an imposition. The words used were strong and exaggerated, rude, and vulgar, but not necessarily slanderous. Special damages were not pleaded, and were not proven, and the words, taken either collectively or separately, are not actionable. They did not charge the plaintiff with crime, nor with an attempt to commit crime. The plaintiff had a right to claim any score he honestly believed he was entitled to, and the defendant had the corresponding right to object to any claim he thought was exaggerated or unjust. We think he did this; nothing more. For the reasons stated, the motion to dismiss the complaint ought to have been granted, and the exceptions to the refusal are well taken. The judgment entered on the verdict in favor of the plaintiff must therefore be reversed, and a new trial ordered, with costs to the appellant to abide the event.


Keeping in mind Kent’s illustration about the sword and the shield, and applying it to this case, it is very clear that the court below has permitted the infant plaintiff here to use his infancy as a sword and not restricted it to use as a shield. In other words, he seems to have approved of the plaintiff perpetrating what seems like a bald <mask> by permitting him to deliberately order certain repairs to his car and then deliberately refuse to pay for them. There is nothing defensive about such a situation as that; on the contrary it is decidedly aggressive. I think the justice’s decision was not right.


And the referee further finds as follows: “ The note was the result of a fraud practiced on the Masons by the plausible stranger who called on them June 19, 1876. They had no idea of signing a note or of authorizing any note to be written over their signatures to what they supposed was an order for a cutter-bar. The stranger was a swindler and the note was a <mask> in his hands. But the careless confidence of the Mason brothers in the plausible stranger contributed to the success of the swindle. Whether the written words and figures were inserted in the blanks of the printed form of note before or after the signature of the Masons was appended was immaterial. The note when offered for sale to Crackett bore every appearance of authenticity. The signature was genuine, and Crackett purchased the note without notice of the fraud practiced upon the signers. Before it fell due, Morris S. Miller, Jr., bought it of Crackett and paid full value for it without notice of the fraud. Before it fell due Miller paid it to plaintiff Carey as the equivalent of money, and Carey took it in good faith and parted with value for it before it was due, and as a conclusion of law the referee held that the paper in question, when it was transfen’ed to Carey in payment for the «nare, was in his hands a valid obligation on the part of the Masons to pay the sum of money named in it which he could enforce against them, and the plaintiff has no claim against the *31defendant for the price of the mare, and the referee directed that a judgment be entered that the complaint be dismissed. We think the decision of the referee was correct according to the cases. That providing a promissory note bears the genuine signature of the obligors which has been intrusted to the holder, the obliger is bound in favor of a holder for value who has taken the note before maturity, and with no notice of any fraud in obtaining the signature, provided there was no actual physical inability to ascertain what the tenor and effect of the instrument purporting to be signed in fact was. (See Whitney v. Snyder, 2 Lans., 477.) Though it seems incongruous to hold that an instrument, which is in fact a forgery, should create an obligation against the person upon whom the forgery has been committed. The principle adopted seems to be as stated in McWilliams v. Mason (31 N. Y., 294), that “the law imposes the loss on the party, who by his misplaced confidence has enabled another, on the faith of his obligation, to obtain money or property from an innocent third party.” Even the fact that the instrument, taken as a whole, is a forgery, for the making of which the party who makes it might be convicted of a felonious forgery, the party whose genuine signature is affixed is nevertheless held liable in favor ef a bona fide holder for value. (Van Duzer v. Howe, 21 N. Y., 531; see also Schultz v. Astley, 29 Eng. Com. L., 655.) The leading features of this case seem to be like the case of Chapman v. Hose, where the defendant entered into a contract with one Miller to act as the agent for the sale of a patent hay fork and pulley, a contract was filled out by Miller and signed by both, also an order which was signed by the defendant for one of the hay forks and two pulleys, for which by the order the defendant agreed to pay nine dollars. These were delivered to the defendant. Another paper was then presented to the defendant for his signature which Miller represented to be but a duplicate of the order. The defendant without reading or examining it, signed it, and delivered it to Miller. The paper so signed was the note in suit for $270. The plaintiff purchased' in good faith before maturity, paying therefor $245. It was held that the plaintiff could recover on the note on the ground that “ where one having the opportunity and power to ascertain with certainty the exact obligation be is assuming, yet chooses to rely on the statements of the person with *32whom he is dealing, executes a negotiable instrument without reading or examination as against a bona fide holder for value, he is bound by his act, and is estopped from claiming that he intended to sign an entirely different obligation, and that the statements upon which he relied were false. To avoid liability he must show that he was guilty of no laches or negligence in signing.”


Museum, as have many other corporations, apparently found that it was most convenient for it to have employees use a credit card for its business purposes. It thus eliminated the use or abuse by an employee submitting what have in the past frequently been referred to as “ <mask> sheets ’ ’. American, on its part was most happy with this arrangement, adding as it admits, to the volume of its business and the size of its profits. American further benefited, as it very bluntly puts it, when it stated in its memorandum of law: “ Corporations, particularly small corporations with limited liability and ease of evolution and dissolution, are particularly unstable. The experience of credit companies with individuals, on the other hand, is that in general terms, they respond well and consistently to *286obligations undertaken. They are, in other words, an important and substantial .source of payments for the company,” Translated, this means that American would not issue credit card status to such corporations, but would do so if it had a sacrificial Iamb on the altar so far as liability was concerned.


It is perhaps ironic that this web of intrigue should have its genesis in a confidence game. In February of 1978 a 65-year-old widow was bilked of almost her entire life savings of over $50,000 in a classic "pocketbook drop” <mask> by two women who purportedly found a large sum of money and offered to let the victim share in the proceeds by putting up "good faith” money.


"1. A person is guilty of fraudulent accosting when he accosts a person in a public place with intent to defraud him of money or other property by means of a trick, <mask> or confidence game. "2. A person who, either at the time he accosts another in a public place or at some subsequent time or at some other place, makes statements to him or engages in conduct with respect to him of a kind commonly made or performed in the perpetration of a known type of confidence game, is presumed to intend to defraud such person of money or other property. Fraudulent accosting is a class A misdemeanor.” Prior to its 1971 amendment, section 165.30 of the Penal Law had read: "A person is guilty of fraudulent accosting when he accosts a person in a public place and, either at that time and place or subsequently in any place, he makes statements to such person of a sort commonly made or used in the perpetration of a known type of confidence game. Fraudulent accosting is a class A misdemeanor.” In People v Harris (64 Misc 2d 510) this court found the statute, prior to its amendment, to be unconstitutional, lacking, as it did, any requirement of fraudulent intent, and in addition creating the apparent necessity of police expert testimony for the establishment of criminality. The issue before us now is whether the amendment to the statute was cosmetic or curative of those defects previously found.


*891The case of Wyatt v. Lortscher (217 App. Div. 224) is cited as “ controlling authority in the case at bar,” but I do not agree with that contention and I do not think that a careful analysis of what was therein decided will support the contention. It is true that the right to enforce a real estate mortgage and some mechanics' liens as against a minor was denied, the minor having pleaded infancy, but it was held (p. 227) “ upon disaffirmance, as just stated, the reciprocal duty arises to give back the consideration still in the infant's hands,” and it was made clear that the rights of those who had improved the infant’s property must be conserved and adjudicated. It was pointed out that some of the parties involved in that proposition were not before the court (p. 228), and that “ in their absence the rights of the defendant cannot be fully adjusted,” and the court continued (p. 228), “ were all parties before the court, it may be that an equitable adjustment might be reached ” in the manner indicated. The case, decides that “ Defendant’s plea of infancy is also effective against the plaintiff’s claim based on mechanic’s liens,” but it does not anywhere say that the defendant, the infant, may hold and have his erstwhile vacant lot upon which a house has been built with the money, labor and material of others, without doing substantial justice and equity by them. What it does say (p. 229) is that “ equities may exist in favor of those who furnished materials and their assigns in case they are able to show that the infant has been enriched thereby * * * The evidence to determine the character and amount of such equities does not appear in the present record.” A new trial was, therefore, granted, rather obviously to give those having claims against the property for its improvement a right to have their claims protected. I do not think the case is any authority at all for upholding such a <mask> as is attempted to be perpetrated here.


Although her letters were revoked because the decedent left a widow who was entitled to administration in preference to all other persons, the former administratrix committed no intentional fraud in applying for letters and has acted honestly and in good faith in the management of the estate. If the dismissed objections to her account had been well founded, she would have been surcharged in the sum of $740.93. She was represented at the trial by an attorney at law. Her successful resistance to the attempted surcharge and the other circumstances above set forth are persuasive arguments for allowing her costs for such contest. There is authority for such exercise of discretion'in somewhat similar situation. (Surr. Ct. Act, §§ 276, 278; Ellis v. Kelsey, 241 N. Y. 374, 381; Matter of Ducker, 146 Misc. 899.) The cases cited on behalf of the administratrix de bonis non are not now in point, for in the three that have some kinship to the present proceeding there is an element of malfeasance (Matter of Howell, 215 N. Y. 466, 470), or of active and *528willful fraud (Matter of Nouman, N. Y. L. J. Apr. 17, 1933), or of conversion and improvident waste (Matter of Stanton, 2 N. Y. Supp. 342). The fourth case dealt in a somewhat humorous vein with a decree, in some respects “ extraordinary ” and “ void,” entered in a revocation proceeding, where the petitioner also sought appointment in place of the respondents, based upon the charge of a conspiracy to <mask> the estate. The charge failed, and the allowance of costs to both parties out of the estate was reversed. The decree met the same fate (Matter of Engelbrecht, 15 App. Div. 541, 547).


What appears to be the crux of the court's decision below to increase Avignone's bail was the concern that Avignone would engage in a fraudulent scheme and <mask> others out of money if he was out of custody. Indeed, the court emphasized this fact when it discussed whether Avignone was likely to return for future court appearances if he made bail:


In this case there was nothing in any documents given by the plaintiff to Grant to indicate that the delivery of the Ford station wagon was conditioned upon any subsequent event. The Ford station wagon was not stolen but obtained by fraud or <mask>. It has been consistently held that obtaining goods by false pretenses is not a felony at common law. (Keyser v. Harbeck, 3 Duer 373.) A swindler conveys good title to a purchaser in good faith for value. (Phelps v. McQuade, 220 N. Y. 232; Industrial Bank of Commerce v. Packard Yonkers Corp., 101 N. Y. S. 2d 189.)


The facts alleged in support of the People’s prima facie case are as follows: The defendant in September 1981 acted as intermediary in a sale of diamonds worth in excess of a million dollars from a jeweler to one Whitney Biddle. David Latner, a businessman, allegedly agreed to give the defendant credibility with the sellers by pretending that defendant was his associate, in exchange for a share of the diamonds. The sellers received an *495ostensibly certified check drawn on the account of and indorsed by Whitney Biddle. The certification was false and the account nonexistent. In October 1981 defendant was arrested on a charge of grand larceny. He was indicted in February 1982. In August 1982 the defendant arranged a meeting in a Manhattan restaurant with a casual acquaintance, Charles Benoit. Benoit arrived first. The defendant arrived and was soon followed by two men who joined him and Benoit. During this brief encounter, the defendant introduced one of the men to Benoit as David Latner. This man introduced his companion to Benoit and to the defendant as Whitney Biddle. The defendant then joined these two men and left Benoit. Several months later, the defendant requested Benoit to testify in the upcoming trial about the encounter with Latner and Biddle. Benoit was confused about the date of the meeting, but eventually recalled with the defendant’s assistance. In January 1983 the defendant introduced Benoit and his proposed testimony to defendant’s lawyer. The trial on the grand larceny indictment began in March 1983. Latner testified about his purported assistance to the defendant in the larceny. Latner was asked by defendant’s counsel on cross-examination whether he had ever introduced Whitney Biddle to the defendant. Latner denied that he had done so. The defendant subpoenaed Benoit, who testified that such introduction occurred in September of 1981 [sic].1 For reasons which are not apparent, Benoit never saw Latner at the trial. The defendant’s counsel argued that it was Latner, and not the defendant, who had engineered the <mask> with the assistance of Whitney Biddle. The defendant was acquitted.


In the late stages of this case, the plaintiffs have concentrated their attack almost exclusively on the compromise of the claims with respect to the forged warehouse receipts. The plaintiffs would have the court enjoin at least this facet of the settlements. However, as the learned Referee correctly reported, settlements of those claims were deemed in the judgment of the directors to be inseparable from the remaining claims. The forged receipts are part and parcel of the underlying <mask>. Even if the prospects of recovery by the holders of the forged receipts *767are without legal basis and dim, this court will not interfere with the honest judgment of the directors that claims based upon them should be settled as an indivisible part of the global settlement. (See Levine v. Behn, supra; Market Co. v. Kelly, supra.) Our system of jurisprudence encourages compromise of claims, not only those based on disputed theories of liability, but, at times, even those where the payor is manifestly faultless. Reasons beyond an instant dispute frequently compel a party to pay unjustified claims. Avoidance of litigation expense, peace of mind, advancement of goodwill are some of the reasons which underlie such compromise. Certainly courts should not discourage this practice. It is noteworthy that the tax court agrees with this principle and allows such payments as business deductions (Laurence M. Marks, 27 T. C. 464).


The answer of the defendant, Eva Jane Buono, also consists of a general denial and the assertion of separate defenses to the effect that the plaintiff, his attorney, the defendant, Anthony Buono and one Rhodes entered into a corrupt scheme to <mask> her of the real estate involved and to subject said property to a usurious mortgage. She also asserts that she executed certain papers while under fear and duress, and without con*791sideration. Further, she asserts that the corporate defendant was formed to conceal a usurious loan and that the stockholders thereof never consented to the execution of the mortgage nor did any officers or directors. Finally, she asserts that the bond given as collateral security by her contained a rider which is allegedly a forgery and that she signed said bond only as a result of fraud and misrepresentation perpetrated upon her and without consideration.


After a three-year investigation, the Attorney-General on February 14, 1967, served — but did not file — a. complaint against Bunge Corporation (Bunge) and -two of its officers ■alleging fraudulent practices with relation to said <mask>. The complaint -alleges 12 causes of action, each in considerable detail. The first cause, summarized very briefly, states that in 1962 and 1963 Bunge was the principal ¡source of financing for Allied’s purchases and sales of commodities; that -the financing was “ collateralized ” by public and field warehouse receipts covering actual commodities in the custody -of warehousemen; that Bunge acquired knowledge of certain specific wrongful manipu*327Mi OILS of Allied and De Angelis, including knowledge that certain tanks in Hoboken, New Jersey, represented to contain millions of pounds of oil, in fact contained no oil; that Bunge acquired this knowledge as a consequence of Allied’s alleged offer of a $25,000 bribe to induce an .inspector to conceal the fact that certain tanks were empty; that Bunge knew that Allied was increasing its forged warehouse receipts in the hands of the public from $8,000,000 to $82,600,000; that Bunge was a member — and the individual defendants were also officers — of the New Yiork Produce Exchange and owed a duty to the Exchange and to the public to report and reveal such knowledge and failed to do so; that such concealment and suppression constituted ‘ ‘ fraudulent practices ” under article 23-A.


From the papers and -oral arguments it appears that the interest of the moving parties in the Bunge case arises from the pendency of at least 41 separate actions by victims of the <mask> against numerous insurers, claiming damages in excess of $250,000,000; they assert that these claimants are attempting to shift the greater portion, of their losses to the insurance industry.- In fact, certain insurers have already paid judgments in the amount -of $4,500,000. Losses resulted from loans made on the strength of fraudulent warehouse receipts for nonexistent oil. The insurance companies issued policies insuring banks and others that the oil did exist. They contend that Bunge, when it learned in 1962 that Allied was missing $7,000,000 worth of oil, continued to do business with Allied but took steps to insulate its-elf against Allied’s insolvency. Bunge achieved such insulation, it is claimed, by inserting between itself and Allied, unsuspecting third parties. Moreover, it is charged that after taking these protective -steps, Bunge ‘1 delivered the fatal blow ’ ’ to Allied by selling short, thus driving down the prices of commodity futures, and resulting in margin calls which Allied could not meet. Bunge, it is further charged, not -only extricated itself .from a vulnerable position prior to Allied’s bankruptcy but also profited from the swindle and .should be made to disgorge the fruits -of its fraudulent practices and that the same be returned to the aggrieved public. On the other hand, Bunge vigorously denies any wrongdoing; argues that there is no basis for any *329suit against Bunge and invites the moving parties — if they really believe they have a good cause — to bring a lawsuit against them.


Northside Elementary School's principal suspended J.S. for a half-day after J.S. cussed on the playground. The school had previously warned J.S. on two occasions to not use profanity. On this third occasion, the school principal called J.S.'s father and told him to come pick up J.S. because he was suspended for the remainder of the school day. J.S.'s father, Ken <mask>, an attorney, refused. Instead, that same afternoon, he filed a complaint in circuit court for a writ of mandamus and writ of prohibition. Since the father did not pick up J.S., J.S. served his half-day suspension in the principal's office. The Rogers School Board later held a hearing and upheld the suspension.


Plaintiffs, 29 individuals who invested in a real estate development venture, commenced this action in 1992 asserting eight causes of action grounded in fraud, breach of contract, violation of the trust provisions of General Business Law § 352-h, and violation of RICO. Plaintiffs’ RICO cause of action alleges the "fraud [of defendants] in the sale of securities, and their use of the mail and telephone wires to perpetrate a fraud and <mask> [which was a] part of a pattern of racketeering activities to execute [their continuing] scheme to take money from” plaintiffs.


“The Judicial Conference, which drafted the bill, had two basic goals: (1) to set up a flexible and functional scheme permitting class actions that would heretofore have been dismissed; and (2) to prescribe guidelines for judicial management of class actions . . . “The heart of the statute is CPLR 901. Borrowing generously from Federal Rule 23, section 901 authorizes a class action whenever the class is sufficiently large to make a representative action the *161fairest and most convenient way to prosecute or defend the suit.” Plaintiffs counsel, in the instant case, attempts to pervert the use of class actions to utilize this court to assist him in increasing the size of his exchequer. Martha Neil, a lawyer and writer on legal affairs, in the July 2003 ABA Journal, New Route for Class Actions (at 48), surveyed class action litigation problems and discerned (at 50), that class actions “often result in minuscule rewards for plaintiffs, according to consumer advocates.” Further, Ms. Neil quotes (at 50) Lawrence W Schonbrun, a California attorney who represents class members challenging class actions outcomes. Mr. Schonbrun observed with respect to class actions that “[i]t’s just another milking of the system by professionals, in this case lawyers . . . It’s a horrible <mask> of the American public in the name of trying to help them. And that the courts and the legal system are at the center of this is shocking and depressing, to say the least.”


"1. A person is guilty of fraudulent accosting when he accosts a person in a public place with intent to defraud him of money or other property by means of a trick, <mask> or confidence game. "2. A person who, either at the time he accosts another in a public place or at some subsequent time or at some other place, makes statements to him or engages in conduct with respect to him of a kind commonly made or performed in the perpetration of a known type of confidence game, is presumed to intend to defraud such person of money or other property.” Defendant contends that the statute is unconstitutional in that it violates the guarantee by the Fourteenth Amendment of due process in that it is vague and does not sufficiently define what is meant by a confidence game so as to inform a person whether his conduct and acts may or may not come within its provisions. Defendant further contends that the present statute (165.30 as amd by L 1971, ch 772) which now includes the element of intent therein does not sufficiently cure its vagueness and indefiniteness. Defendant relies on People v Harris (64 Misc 2d 510), decided before the statute was amended, declaring former section 165.30 of the Penal Law unconstitutional.


Swindle's request for relief-that the school remove any reference to J.S.'s suspension and never suspend him again-lacks foundation in any source of law. <mask> has not cited a single case that would support such a vast judicial overreach into matters left, rightly so, in the discretion of locally elected school boards. See Fortman v. Texarkana Sch. Dist. No. 7 , 257 Ark. 130, 514 S.W.2d 720 (1974).


“What the credible evidence shows is that on December 26th 2009, this defendant, right there, tried to <mask> David Cushman out of his $35,000 engagement ring . . . Just like the swindle with Mary Nguyen, this defendant just so happened to bring fake jewelry with him on the day when he completed this crime after months of contact with David Cushman. Just like he swindled with [sic] Mary Nguyen, this defendant’s actions were planned, they were calculated, and they were morally . . . bankrupt.” Later, he said:


We view the general character of the terms of the statute at issue from the perspective that the specified statute is not expected to delineate all statements and actions which might be calculated to <mask> a member of the public (see Hechtman, Commentaries, McKinney’s Cons Laws of NY, Book 39, Penal Law, § 165.30). The crime of fraudulent accosting, nebulous by its very nature, is sufficiently defined by the amended statute so as to give a reasonable man, of average intelligence, sufficient notice of what is proscribed thereby. Accordingly, we find section 165.30 of the Penal Law, as amended, to be constitutional.


The majority of his prior convictions involve some type of dishonesty. Mr. Jennings’ prior criminal contacts primarily involved his attempts to cheat, con, <mask> or steal property that didn’t belong to him. He testified, at great lengths, to some of the individual schemes and con jobs he had previously performed. Mr. Jennings was particularly frank about his efforts to manipulate the criminal justice system.


Prosecutor: On behalf of [the complainant's] family, I'm looking for justice as well. I think he deserves a life sentence because he pulled a <mask> on all of us including this family. Give us the justice they deserve in the [codefendant's] trial. Defense counsel: Your Honor, I must object to appealing to the expectation of other people as to what your sentence should be. I just want to lodge that objection to that argument. Contrary to Joyner's contention, this objection-which was specific "to appealing to the expectation of other people"-does not raise the issue of breach of a plea agreement or prosecutorial misconduct, as required by Rule 33.1. There is no indication in the record of any objection on this basis.


The article commences with an account of the stock operations of the proprietors of the Daily Times, of whom the plaintiff is alleged in the complaint to be one. From that, and its comments upon it, the article passes to “The Valley Bank <mask>,” the profits of which are stated to be between $200,000 and $300,000. The article states that the Times proprietors got but about one-fourth “of the plunder.” They furnished theiwhole capital, which was small, for onefowrth of the profits. “ The Valley Bank exploded sooner than was intended.” “ It was the intention of its originators to get out a circulation of half a million before the collapse, but some of the machinery at work gave way, and brought the concern suddenly to a dead lock.”


*831Bunge, for a number of years prior to and during 1963, had continuous business dealings with Allied Crude Vegetable Oil Refining Corp. (Allied), not a party to this action and now a bankrupt as a by-product of the infamous salad oil <mask>. Both were engaged in various aspects of the vegetable oil business. A substantial portion of their transactions involved the sale or transfer by one to the other of negotiable bills of lading, field warehouse receipts and registered warehouse receipts covering cottonseed oil and soybean oil. The underlying transactions here involved registered warehouse receipts.


Equally insufficient is the defense that Bunge is barred because the transactions concerning these checks were part and parcel of an alleged continuing series of illegal, fictitious and fraudulent transactions and schemes in which Allied and Bunge were involved as part of the 1 ‘ salad oil <mask> ’ ’ or conspiracy. The evidence does not support any such conclusion. Although defendant was given every opportunity to plead and prove this defense, it utterly failed to do so. On the opening of trial, after five years of litigation, it was permitted to amend its answer for a third time, to plead such defense in expanded form. It was permitted, over objection, to conduct what may be described fairly as an extensive pretrial discovery proceeding as part of the trial by means of witnesses, depositions and a myriad of *845documents in its attempt to establish such defense. The court is unable to find any such illegality in the transactions between Allied and Bunge as should bar plaintiff’s recovery in this action. Although some of their transactions may neither be commendable nor thought to be in the public interest, there is no clear proof of illegality. Even if illegality were to be found with respect to some other transactions, it has not been shown that any illegality infected or related to the three checks subject of this litigation or to the transactions underlying their issuance. It is found that these transactions were not proven to be illegal. Although the courts will close their doors to a plaintiff who sues to enforce an illegal bargain, it must be shown that the cause of action arises out of or in connection with the illegality asserted. (Seagirt Realty Corp. v. Chazanof, 13 N Y 2d 282; Southwestern Shipping Corp. v. National City Bank of N. Y., 6 N Y 2d 454; Kelly v. Kosuga, 358 U. S. 516; Tenna Corp. v. Rego Radio & Electronics Corp., 270 F. Supp. 31.) The defense of illegality was not proved.


The Supplementary Practice Commentary to section 165.30 of the Penal Law (as amd.), by Arnold Hechtman, states (McKinney’s Cons. Laws of N.Y., Book 39, Penal Law, 1974-1975 Pocket Part, pp 238-239): "L 1971, c 772, recasting the crime of Fraudulent Accosting, is an attempt to overcome the constitutional deficiencies of the prior version found by the Appellate Term, First Department, in People v Harris, 1969, 64 Misc 2d 510. The court there pointed to "an absence on its face of any requirement that the action proscribed be committed with a fraudulent purpose or fraudulent intent.” The amended provision now requires, as an element of the crime, an "intent to defraud * * * by means of a trick, <mask> or confidence game”. To meet the Harris court’s objection to the establishment of criminality by "the expertise and observations of the officer, based on facts not made part of the crime *151by the statute itself,” subdivision 2 of the amended section only creates a presumption of intent to defraud from the statements made or the conduct engaged in. Proof that the statements and conduct were of a kind commonly used in confidence games will remain a matter for expert testimony— there being no practical way for a statute to delineate all the statements and conduct that are or can be employed to swindle people.”


There are two situations where the term "illusory tenant” has been used: one is to describe a <mask> who, as alter ego of the landlord, subleases the apartment to permit the landlord to circumvent or evade his obligations under the rent laws. (Matter of Hiyee Realty Corp. [New York City Conciliation & Appeals Bd.], NYLJ, May 5, 1982, p 6, col 1 [Alexander, J.].) Such an illusory tenancy has been expressly condemned in Yellon v Reiner-Kaiser Assoc. (89 AD2d 561). (Cf. Stutt v Unique Restorations Co., 96 AD2d 1039.) The second type of illusory tenancy involves a prime tenant who is an individual entrepreneur trafficking in stabilized or controlled apartments which he subleases as a business. (Van Seplow v Conciliation & Appeals Bd., Sup Ct, NY County, index No. 100334/75, Asch, J.; Matter of Walsh [Conciliation & Appeals Bd.] NYLJ, Oct 14, 1982, p 7, col 4 [Rettinger, J.]; Rogal v Conciliation & *837Appeals Bd., Sup Ct, NY County, index No. 21713/82, Evans, J.)


In arguing the first point, defendant relies upon the enabling legislation — section 89 of the Village Law. Paragraph (2) of subdivision 63 thereof, entitled “Regulations of vessels” explicitly states that no village ordinance “ shall take effect until it shall have been submitted to and approved in writing by the conservation commissioner ” (of the State of New York). Concededly, no such approval was ever obtained. But since subdivision 63 deals with boating and sewage regulations, and since it is not the basis of the complaint, the court regards this contention as not in point and somewhat of a <mask> argument.


An illusory tenancy is created when a prime tenant subleases an apartment to deprive the subtenant of Rent Stabilization Law (RSL) rights or to profiteer. (Matter of Badem Bldgs. v Abrams, 70 NY2d 45, 52-53 [1987]; Primrose Mgt. Co. v Donahoe, 253 AD2d 404, 405 [1st Dept 1998]; Matter of Avon Furniture Leasing v Popolizio, 116 AD2d 280, 284 [1st Dept 1986], lv denied 68 NY2d 610 [1986].) In the first scenario, a tenant who acts as the landlord’s <mask> or alter ego subleases an apartment so that a landlord can circumvent the rent laws. In the second scenario, a tenant is in the business of renting a rent-regulated apartment and then subleases it for profit. Both scenarios exist here. Art Omi, together with Time Equities, deprived respondent of her RSL rights. And Art Omi and Time Equities profited from the arrangement.


Alan J. Saks, J. On this motion to vacate a default judgment, it is not disputed that the person to whom the summons and complaint was personally delivered was Pauline Howard, the defendants’ daughter. Such delivery occurred on February 28, 1983. The process server’s affidavit described her as being approximately 16 years old, five feet, five inches in height and weighing 100 pounds. The defendant mother avers that she was only 11 years old. CPLR 308 (subd 2) requires that delivery be made to a person of suitable age and discretion. Plaintiff’s counsel sets up a <mask> when it responds by asserting that delivery to a minor does not by itself render service invalid. There are minors and minors. Although the statute does not set a fixed minimum age, the court must strive to find meaning in every word contained in a statute. It must, therefore, presume that the inclusion of the word “age” was not without statutory intention, i.e., that at some point a person should be deemed by the court, as a matter of law, to be too young to have a valid status as deli ver ee.


Furthermore, in the case at bar, the plaintiff did not deal with Wapniak. He gave the check to Karnell, acting as agent for Mindy Auto Collision, Inc. There is no proof that plaintiff knew of Wapniak’s course of dealing; that he knew the car was stolen at the time when he gave the check to Karnell; that he knew Mindy was used merely as a “ <mask> ’ ’ for Parts Service. Suspicion is not proof, and without proof plaintiff may not be barred from his right to recover against Boyal. On the contrary, it appears that Wallace Karnell did not own any stock of Mindy Auto Collision, Inc. He testified that he was the ‘ ‘ owner ’ ’ of Mindy Motors, Inc., but not of Mindy Auto Collision, Inc., at the time of this transaction. It also appears that the car was originally a wreck; that one Muller was the original owner and he was indebted to Wapniak for parts used in its repair; and he had asked Wapniak to sell it for him. Thus, this is not a case of plaintiff intending the proceeds of the check to be paid to the person known by plaintiff to be entitled thereto. There is no proof that Simon Wapniak, doing business as Parts Service of America, was intended by plaintiff to be, and was dealt with by plaintiff as ‘‘ the rightful owner of the check,” as defendant claims he was.


As to the first separate and distinct affirmative defense and counterclaim, it appears that the substance of the defense is an assertion that the plaintiff never loaned any money to the defendant, that the defendant was a “ <mask> ” and that the plaintiff was in fact borrowing the money. The facts alleged are provable at the trial under the defendant’s denials of paragraphs *9083, 4 and 5 of the complaint, and it is unnecessary to allege them as an affirmative defense. However, in Morgan Munitions Co. v. Studebaker Corp. (226 N. Y. 94, 98) the court said: “ Matter which would be sufficient under a general denial loses none of its efficacy by being pleaded as a defense. ’ ’ Therefore, it is sufficient as a defense, and the motion to strike it as a defense is denied.