FILED: NIAGARA COUNTY CLERK 08/31/2021 12:52 PM INDEX NO.

E169947/2019
NYSCEF DOC. NO. 205 RECEIVED NYSCEF: 08/31/2021

At IAS Part 22 of the Supreme Court

of the State of New York, at the
Courthouse located at 25 Delaware
Avenue, Buffalo, New York 14202
on the 30th day of August 2021.

PRESENT: Hon. Timothy J. Walker J.C.C., A.S.C.J.

SUPREME COURT OF THE STATE OF NEW YORK

COUNTY OF NIAGARA
--------------------------------------------------------------------- x
STRATEGIC FUNDING SOURCE, INC. D/B/A : Index No.: E169947/2019
KAPITUS and COLONIAL FUNDING NETWORK, :
INC. N/K/A KAPITUS SERVICING, INC., as servicing : Mot. Seq. No. 007
provider for PROVIDENCE MERCHANT ADVANCE, :
LLC, :
: ORDER
Plaintiffs, :
:
-against- :
:
RAPIDS THEATER, NIAGARA FALLS USA, INC., :
HUTCH ENTERPRISES, INC. and JOHN L. :
HUTCHINS, :
:
Defendants. :
--------------------------------------------------------------------- x

WHEREAS, on July 8, 2021, Plaintiffs Strategic Funding Source, Inc. d/b/a Kapitus and

Colonial Funding Network, Inc. n/k/a Kapitus Servicing, Inc., as servicing provider for Providence

Merchant Advance, LLC (collectively, “Plaintiffs”), by and through their counsel, Windels Marx

Lane & Mittendorf, LLP, moved for an order pursuant to CPLR 5228(a) appointing a receiver to

aid in the enforcement of the Judgment (the “Motion”);

NOW, UPON the reading and filing of the Affirmation of Robert J. Malatak affirmed July

6, 2021 (with exhibits); and upon all prior proceedings heretofore had herein:

AND, this application having been come to be heard before this Court on submissions only,

and after due deliberation thereon,

NOW, it is hereby
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ORDERED, that Plaintiffs’ Motion is GRANTED; and it is further

ORDERED, that

1. Upon the filing of an oath in accordance with CPLR 6402, and a bond in the amount
of $500 pursuant to CPLR 6403, Steven Bengart, Esq. (716-838-4600) is hereby
appointed as a temporary receiver (the “Receiver”) of the assets, property, and
business of John L. Hutchins, Rapids Theater, Niagara Falls USA, Inc. (“Rapids
Theater”), including, the Judgment Debtor Companies (defined below), and Hutch
Enterprises, Inc. (collectively, the “Judgment Debtors”), with authority, inter alia,
to take possession of, control and manage any and all interest or remaining direct
or beneficial interest of the Judgment Debtors in the Judgment Debtor Companies
(defined below) located at 1711 Main Street, Niagara Falls, New York, together
with all other assets and business of the Judgment Debtors, including interests in
real and personal property, bank accounts, securities, instruments, receivables,
cash, and any and all other assets and property of the Judgment Debtors;

2. the Receiver shall take possession of (a) the Rapids Theater, (b) the Judgment
Debtors’ interest in the Rapids Theater, and (c) any/all companies doing business
as the Rapids Theater, located at 1711 Main Street, Niagara Falls, New York (the
“Judgment Debtor Companies”), and that the Receiver may administer, manage, or
otherwise operate the Judgment Debtor Companies for purposes of satisfying the
Judgment;

3. that upon receipt of Plaintiff’s written consent, the Receiver may incur, at the
expense of the Judgment Debtor Companies, such costs and charges, and make such
disbursements, as may actually be necessary for obtaining possession thereof,
preserving the same, and executing the duties imposed by this order, and that upon
receipt of Plaintiff’s written consent, the Receiver is authorized to institute and
carry on all legal proceedings necessary for the protection of the Judgment Debtor
Companies or to recover possession thereof, and to employ counsel in connection
with any matters involving the property;

4. that the Receiver shall enter upon the premises of the Judgment Debtor Companies
with full authority to examine and inspect all financial records of the Judgment
Debtor Companies and report to Plaintiffs and the Court the state of the Judgment
Debtor Companies’ financial affairs, including without limitation:

i. the presence of any salable assets with which to satisfy (in whole or
part) the Judgment;

ii. an accounting of cash receipts, payments, and other funds received

by the Judgment Debtor Companies from April 14, 2017 to the
present;

iii. an accounting for all loans received, the proceeds therefrom, and the
use of such funds by the Judgment Debtor Companies from April
14, 2017 to the present;
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iv. the identity of each and every bank account utilized by the Judgment
Debtor Companies from April 14, 2017 to the present; and

v. an accounting of any transfers of assets of the Judgment Debtors and

the compensation received therefrom from April 14, 2017 to the
present;

5. that Plaintiffs, as Judgment Creditors, and the Receiver herein, have priority of lien
on all of Judgment Debtors’ assets with respect to the Judgment, and that the
priority of lien be directed to extend in time to the conclusion of any motion or
supplementary proceeding brought in connection with satisfaction of the Judgment;

6. that any and all payments that are or may be forthcoming with respect to all
distributions, dividends, profits and any other monies that would otherwise be
payable to the Judgment Debtors be made to the Receiver, pursuant to CPLR 5228,
for the benefit of Plaintiffs;

7. that the Receiver shall deposit all monies collected in his own name, as receiver, in
a major New York bank for the benefit of Plaintiffs and no withdrawal shall be
made therefrom except as directed by order of the Court or on a draft or check
signed by the Receiver and countersigned by the surety on his bond or as required
to pay for the expenses of and the ordinary costs of the receivership, such
withdrawals shall not exceed $1,000.00 without receipt of Plaintiff’s written
consent;

8. that the Receiver shall furnish to Plaintiffs:

a. monthly statements of the receipts and expenditures of the receivership,

together with a photocopy of the monthly statements received from said
receivership;

b. monthly copies of bank statements;

c. copies of the Judgment Debtor Companies’ books and records, including,

without limitation, receivables aging reports, payables aging reports, profit
and loss statements, balance sheets, statement of cash flows;

9. that the Judgment Debtors shall produce to the Receiver copies of any Quickbooks
or other accounting software files utilized by the Judgment Debtors or the Judgment
Debtor Companies and that the Judgment Debtors shall furnish the passwords to
same to the Receiver;

10. that the Receiver, or any party hereto, may at any time make an application to the
Court to release the funds or a percentage thereof for purposes of satisfying the
Judgment, in whole or in part, or for any other purpose so long as it is consistent
with satisfying the Judgment or in furtherance of the Receiver’s duties;
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11. that the Receiver may at any time apply to this Court for an order or other
instructions or powers necessary to enable the Receiver to properly fulfill the
Receiver’s duties;

12. that the Receiver may apply to this Court for an order authorizing the Receiver to
pay over to himself such commissions, not to exceed five (5) percent upon the sums
received and disbursed by him.

13. that the Receiver shall keep written accounts in accordance with CPLR 6404;

14. that the receivership shall terminate by Order of this Court;

15. that the Receiver shall provide a final accounting to Plaintiffs and the Court of all
funds received and/or disbursed by Receiver;

16. it is further ordered NOT WITHSTANDING ANY OTHER PROVISION OF THIS

ORDER TO THE CONTRARY, RECEIVER SHALL NOT APPOINT AN
ATTORNEY, APPRAISER, AUCTIONEER OR ACCOUNTANT, MANAGING
AGENT OR MANAGING SERVICES WITHOUT THE PRIOR
AUTHORIZATION OF THE COURT, AFTER MOVING IN A SEPARATE
APPLICATION PURSUANT TO 36.1 OF THE UNIFORM COURT RULES.

DATED: August 30, 2021

Hon. Timothy J. Walker, J.C.C., A.S.C.J.

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