On January 27, 2022, Justice Ruchelsman of the Kings County Commercial Division issued a decision in Zwebner v. Strulovitch, 2022 NY Slip Op. 30478(U), dismissing a claim for an equitable lien because it was not based on a promise relating to the purchase of a specific property, explaining:
Equitable liens grant[] the plaintiff a security interest in property and are generally imposed to prevent unjust enrichment. The traditional distinction between a constructive trust and an equitable lien is that the beneficiary of a constructive trust receives complete title to the asset whereas the holder of an equitable lien receives only a lien on the asset through which it may satisfy a money claim. Thus, an equitable lien is proper in favor of a plaintiff where due to the nature of his or her relationship with a property owner, has relied upon that owner’s unfulfilled promise to convey the property, and as a result has expended funds to preserve or improve it in anticipation of the conveyance. However, an equitable lien requires an express or implied contract concerning specific property wherein there is a clear intent between the parties that such property be held, given or transferred as security for an obligation. In Datlof, the plaintiff sought an equitable lien on defendant’s property since defendant bought the home with funds loaned by the plaintiff which were never repaid. The court held no such equitable lien was possible because even if the defendant had promised to repay the loan from the proceeds of the sale of the home an agreement to pay a debt out of a designated fund does not operate to create an equitable lien upon the fund. Again, in Liselli v. Liselli, 263 AD2d 46B, 693 NYS2d 195 [2d Dept. 1999] the plaintiff sought to impose an equitable lien upon property purchased by the defendant with funds loaned by the plaintiff. The court concluded that a failure to pay money owed does not give rise to an equitable lien. The court explained that the Court of Appeals has observed that, an equitable lien is dependent upon some agreement express or implied that there shall be a lien on specific property and that an equitable lien requires an express or implied contract concerning specific property wherein there is a clear intent between the parties that such property be held, given or transferred as security for an obligation. Of course, where the evidence demonstrates that funds were expended in anticipation of future ownership based upon a promise then an equitable lien would be proper. In this case, clearly no such promises were made and no expectations exist concerning any of the defendant properties. It is true that in a decision rendered by this court in Angel v. Strulovitch, the court entertained the possible existence of another type of equitable lien where a debt is owed and equity demands certain property stand as security for payment for the debt. However, further and greater analysis reveals there are no cases in New York that have espoused the existence of such a broad definition of an equitable lien. Notwithstanding Schwartz v. Schwartz, 2014 WL 6390316 [E. D. N. Y. 2014] which seems to have adopted the existence of this other type of equitable lien, clearly, the .guidance of the Second Department, which directly binds this court, has not embraced any other type of equitable lien, Therefore, based on the foregoing, the motion seeking to dismiss the constructive trust and equitable lien claims are granted.
(Internal quotations and citations omitted).