On April 15, 2026, the Second Department issued a decision in Canzona v. Atanasio, 2026 NY Slip Op. 02243, holding that the fact that the plaintiff owed the defendant money was an insufficient basis for a conversion counterclaim, explaining:
The defendants also failed to establish their prima facie entitlement to judgment as a matter of law on their counterclaim for conversion, alleging that the plaintiff misappropriated funds intended for loan payments and failed to repay his half of a loan with respect to a shared asset.
To establish a cause of action to recover damages for conversion, a plaintiff must show legal ownership or an immediate superior right of possession to a specific identifiable thing and must show that the defendant exercised an unauthorized dominion over the thing in question to the exclusion of the plaintiff’s rights. Moreover, the mere right to payment cannot be the basis for a cause of action alleging conversion since the essence of a conversion cause of action is the unauthorized dominion over the thing in question. Here, the defendants asserted that the plaintiff misappropriated funds they sent to the plaintiff to make payments on the boat loan. However, in support of their motion, the defendants submitted an affidavit in which Charles admitted to transferring the money to the plaintiff, as well as receipts demonstrating that the defendants had authorized the payments. The defendants thus failed to establish that the plaintiff had unauthorized dominion over the funds.
(Internal quotations and citations omitted).