Dambroso v Malik

[*1] Dambroso v Malik 2006 NY Slip Op 51539(U) [12 Misc 3d 1192(A)] Decided on August 2, 2006 Civil Court, Queens County Culley, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. As corrected in part through August 10, 2006; it will not be published in the printed Official Reports.

Decided on August 2, 2006
Civil Court, Queens County

Siramanee Dambroso and Chumpol Chamvuttipreecha, Plaintiffs,

against

S.I. Malik and Pankaj Malik, Esq., Defendants.



300735/05

Anna Culley, J.

The plaintiffs bring this action against the defendants, S. I. Malik and Pankaj Malik, Esq., seeking damages for breach of a contract executed on April 10, 2003, for the purchase of a cooperative apartment unit located in Elmhurst, New York owned by defendant S. I. Malik. The following are the findings of fact and conclusions of law reached by the court after a bench trial: The contract provided, inter alia, that the closing date of the sale was to be "on or about" June 10, 2003, and that the premises were to be conveyed "broom clean and vacant." The contract was not contingent on the plaintiff's ability to obtain mortgage financing or the sale of her primary home.

At the plaintiff's request, the closing was adjourned approximately thirty (30) days from the proposed June 10, 2003 closing date. Defendant Pankaj Malik, Esq., the attorney for defendant-seller (and also his daughter), testified that when she attempted to schedule a closing date in early July, she was informed that plaintiff had not sold her home and was without the funding to close. By letter dated July 14, 2003, the defendant notified the plaintiff that the closing would take place on July 28, 2003, and declared "time is of the essence" with respect to

the closing date. The plaintiff immediately responded by sending a facsimile to the defendant which set forth the reasons she was unable to close as indicated above. In a letter dated July 15, 2003, the defendant refused to a further extension of the closing date and pointed out that the plaintiffs' purchase of the premises is not subject to the sale of her home.

Plaintiff thereafter took necessary steps to obtain the funding to proceed with the purchase on July 28, 2003, including liquidating certain assets and borrowing money from friends.

On July 28, 2003, plaintiff sought to inspect the apartment prior to the closing in accordance with the contract. While there she discovered that defendant's tenants were in possession of the apartment. At her attorney's instruction, she did not attend the closing nor tender the balance of the purchase price in accordance with the contract. Defendant S.I. Malik explained that the reason the tenants were still in possession of the premises at the time of closing was because he did not want to have the apartment vacant for several months while waiting for plaintiff to close, and, therefore, entered into a verbal understanding with his tenants whereby they would voluntarily vacate upon short notice of a couple of weeks. After the "time is of the essence" letter was sent, however, one of defendant's tenants notified him for the first time that the other, his wife, was ill and they would be unable to move for another ninety days. [*2]Defendant admitted he was simply unwilling to evict his tenants, who had been in possession of the premises for a long period of time, and, therefore, could not convey the premises "broom clean and vacant" in accordance with the contract.

By letter dated July 30, 2003, plaintiff's attorney demanded that the closing be held on

August 6, 2003. Defendant, however, still unable to convey the co-op free of tenancies, offered

to convey apartment with the tenants in possession. Plaintiff agreed, provided $8,500 of the

purchase price was held in escrow to ensure the tender of possession in accordance with the contract. Defendant agreed to an escrow of the sale proceeds, but for no more than $2,500. Plaintiff rejected the amount as inadequate. The parties ceased negotiating and defendant sent notice of cancellation of the contract along with the return of plaintiff's down payment. Plaintiff accepted the down payment and now sues for incidental and consequential damages in the

amount of $14,704.02 for defendant's breach of contract, including her legal fees, co-op search fee, four months rent, moving costs, co-op application fee, penalty for liquidating investments and interest on a personal loan.

At the outset, since no theory of recovery is alleged as to defendant Pankaj Malik, Esq., other than breach of contract, and, she was clearly not a party to the contract but merely the attorney for the seller, the complaint as to her is dismissed.

In an action to recover damages for breach of a contract for the purchase of real property, the measure of damages is the difference between the contract price and the market value at the time of the breach, together with reasonable attorney's fees and other expenses necessarily incurred in reliance upon the contract, with interest from the date of the breach (Astoria Caterers, Inc. v. J&P 1870 Realty Corp., 24 AD3d 478 [2nd Dept. 2005]; Mohen v. Mooney, 205 AD2d 670 [2nd Dept. 1994]). In contrast, in an action for specific performance, the court has broad discretion in fashioning an appropriate remedy and, thus, the court may award the purchaser damages resulting from the seller's delay in conveying title (see Bregman v. Meehan, 125 Misc 2d 332 [Sup Ct, Nassau County 1984]; see generally, 55 NY Jur 2d, Equity, § 98).

Here, the evidence clearly established that defendant, S.I. Malik, breached the contract for the sale of his property in that he failed to deliver the property to plaintiff in "broom clean and vacant" condition on the law day, then terminated the contract when plaintiff refused to accept the premises with defendant's tenants in possession. Under the circumstances, plaintiff was not required to tender performance or demand a cure (see Ianelli Bros. v. Muscarella, 184 AD2d 548 [2nd Dept. 1968] aff'd 24 NY2d 779 [1969]).

Plaintiff, however, may not recover damages incurred by the delay in conveying title, i.e., rent incurred, moving costs, penalties for premature liquidation of investments and surrender charges, and loan interest from October 21, 2003, since plaintiff has not sought nor obtained specific performance of the contract. Plaintiff is limited to damages which may be obtained in an action at law (Lotito v. Mazzeo, 132 AD2d 650 [2nd Dept. 1987]). Accordingly, plaintiff, who has not asserted a claim for the difference between the contract price and the market value at the time of breach, may only obtain the following items of damages: the cost of the co-op search ($250.00) , the co-op application fee ($76.00), and reasonable attorney's fees ($500.00), for a total of $826.00 with interest from the date of breach. Moreover, even if plaintiff had brought a claim for specific performance, this court is powerless to fashion such equitable relief where the value of the property exceeds $25,000 (New York City Civil Court Act § 203 [d]; Goldstein v. Stephens, 118 Misc 2d 614 [App Term, 1st Dept. 1983]). [*3]

Based on the foregoing, judgment for plaintiff in the sum of $826.00 with interest from August 6, 2003. Both sides have been mailed a copy of this decision/order and along with their exhibits.

________________________

ANNA CULLEY, J.C.C.

Dated: August 2, 2006