Rhona Silver must pay Prudential Douglas Elliman more than $2.3 million for 2007 sale
Rhona Silver sold the Huntington Townhouse in 2007 and a flurry of lawsuits followed. Six years after she sold the East Jericho Turnpike catering hall, one of those suits is finally drawing to a close.
A Suffolk Supreme Court jury ruled on June 20 that Silver owes Prudential Douglas Elliman brokerage commission for the $38.5-million sale plus interest. Elliman attorney Robert Zausmer said they are owed at least $2.3 million. That includes a $1.5 million commission and 9 percent annual interest.
“It’s earning interest every day at 9 percent,” Zausmer said.
Silver bought the 148,000-square foot catering hall and the 18 acres it sat on in 1997 and sold it to Lowe’s Home Improvement in June 2007. Lowe’s demolished the Townhouse and planned for a 103,000 square-foot store and 26,500 square-foot garden center. The company killed the project in November 2011 and sold it to Target, which expects to open a 150,000 square-foot store this fall.
While Silver explored possible sales, Prudential Douglas Elliman was connected with the process. According to a 2007 lawsuit filed by the real estate firm, she engaged the company to sell the Huntington Townhouse. But when Lowe’s signed on the bottom line, Silver ditched Prudential for developer and then-lover Barry Newman.
Elliman’s lawsuit demanded a 6-percent commission from both Silver and Lowe’s. Zausmer confirmed an agreement was reached with Lowe’s, the details of which he refused to disclose.
However, Silver’s attorney, Jeffrey Buss, griped that Prudential Douglas Elliman did nothing but interfere with a deal already in the works. Lowe’s and Silver were talking for four years, he said, before the real estate firm offered three unsolicited offers for half the final price. Elliman, he added, required conditions in their offers while Lowe’s took the property as-is – a public road needed to be closed, steep slopes needed to be addressed and the property had to be reconfigured for Lowe’s.
“You have to do something to earn a commission,” Buss said. “It’s ridiculous they would even be suing, let along winning,”
The case finally went to trial in March 2011. After four days, the judge declared a mistrial. Zausmer said his key witness’ significant other died shortly before the witness was to testify, and the judge was not willing to delay the case further.
The most recent trial began on June 10 and concluded 10 days later.
Buss requested the court dismiss the case during the trial, which Judge Elizabeth Emerson delayed ruling on until after a verdict was announced. The respondent’s attorney also filed a motion to set aside the jury’s decision. Zausmer said his response is due by July 25.
“We think the verdict was contrary to the evidence and to the law,” Buss said.
The attorney also promised to appeal if his motion was not successful.
Zausmer submitted a judgment to Emerson on July 17 in hopes of collecting. Silver would either have to have the verdict dismissed, win an appeal or obtain a stay of judgment to avoid paying.
“If they can’t get the stay, then I can try to collect on the judgment. The appeal would take months and months,” he said.
Buss is also representing Silver in a lawsuit against Newman. The former Huntington Townhouse owner filed a lawsuit against the developer in 2010 for allegedly working with her former attorney to steal proceeds from the sale. The attorney, Howard Ritberg, is the respondent in another trial against Silver.
An attorney for Ritberg previously said Newman tried to help Silver keep the catering hall fiscally solvent. She approached him for help in 2003, the attorney said, which he ultimately provided with $10 million in personal loans and nine mortgages.
According to the lawsuit, Silver owed $34,494,342.41 to debtors in June 2007. She reportedly agreed Newman would receive $3.5 million for his role in securing Lowe’s as buyers and the remaining $700,956.05 would be used to pay non-secured debt from the Huntington Townhouse, including reimbursements for down payments.
Buss said a hearing is scheduled for July 31 and declined to comment until after the latest hearing.
Silver is also still in court with her brother, Howard Silver. He took her to court in 2007, claiming they allegedly had a verbal agreement in 1997 to split ownership of the Huntington Townhouse. Howard claimed he worked as a manager, oversaw sales and promoted events in the townhouse’s early years. A trial in that case was scheduled to begin on May 21, but was twice adjourned until Sept. 24.