J.H. Electric of New York, Inc. v. Anchor Construction, Inc. , 736 N.Y.S.2d 878 ( 2002 )

—Judgment, Supreme Court, New York County (Edward Lehner, J.), entered June 6, 2001, after a nonjury trial, in plaintiff’s favor and against defendants, in the total sum of $52,583.74, for defendants’ diversion of Lien Law trust funds, unanimously affirmed, with costs. Appeal from order, same court and Justice, entered March 27, 2001, after a nonjury trial, finding defendants liable for diversion of Lien Law trust funds, unanimously dismissed, without costs, as subsumed in the appeal from the ensuing June 6, 2001 judgment.

The court properly imposed liability on all defendants for their participation in diverting funds subject to a Lien Law trust (see, Lien Law § 70 et seq.). There was sufficient evidence of the overlapping relationship between defendant contracting corporations to support findings that both of said corporations were in contractual privity with plaintiff, and thus that both corporations were statutory trustees of funds received by them for work on the subject construction project, out of which funds plaintiff, a subcontractor on said construction project, was to be compensated (see, Quantum Corporate Funding v L.P.G. Assoc., 246 AD2d 320, 323, lv denied 91 NY2d 814). There was also sufficient evidence presented that defendants had breached their duty as statutory trustees by participating in the diversion of the funds held by them in trust for plaintiff.

We have considered defendants’ remaining arguments and find them unavailing. Concur — Tom, J.P., Mazzarelli, Sullivan, Wallach and Marlow, JJ.