Freund & Freund & Co., Inc. v Biscuits & Baths Tribeca, LLC
Annotate this CaseDecided on May 22, 2009
Civil Court of the City of New York, New York County
Freund & Freund & Co., Inc., Petitioner-Landlord,
against
Biscuits & Baths Tribeca, LLC, Respondents-Tenant, and XYZ Corp. 1-2, Defendant.
L & T 81842/08
Glenn Backer, Esq., for Petitioner 295 Madison Ave. 22nd. Fl NY 10017
Delotto & Fajardo, by Eduardo A. Fajardo, Esq., for Respondent
44 Wall Street- 10th Fl. N.Y.NY 10005
Manuel J. Mendez, J.
This Holdover Summary Proceeding was tried by the court from April 20- 23, 2009. At the end of the trial this court reserved decision. Following a review of the facts and the applicable law this court renders its decision in favor of the Respondent-Tenant dismissing the Petition and re-instating the lease.
FINDINGS OF FACT
The parties entered into a lease for premises located at 102 Franklin Street on November 30, 2006. The lease is for a period of ten (10) years, running from December 1, 2006 to December 31, 2016, with three Renewal Options for three additional periods of ten years each. The premises demised comprise "approximately 2500 square feet of the ground floor space, 2500 square feet of the basement level space and the rear outside yard of the building." and was to be used for "dog care, dog day care, 24 hour supervised care, overnight care, boarding, kenneling, exercise, [*2]socialization, grooming, training, dog walking, pet sitting, transportation, veterinary services, sales of animals, adoptions of animals, pet insurance, special events, sales of pet related merchandise, and any other pet related offerings, provided same are in compliance with legal requirements and no other use or purpose whatsoever."[See Petitioner's 10].
Before opening for business Respondent needed to renovate the demised premises in order to use it for the intended purpose of its dog grooming business. Respondent retained the services of an Architectural firm, Design Laboratories LLC, Frome Ruff and Associates, and a mechanical Engineer, Jack Lifshitz.
In accordance with Paragraph 45(A) of the Rider to the lease "no alterations, repairs, or changes shall be made to the demised premises unless and until tenant shall have first secured the written approval by owner of the plans and specifications therefore for any alterations that will adversely affect the structural integrity of the building or materially adversely affect building systems serving portions of the building located outside the premises, other alterations shall not require the prior consent of owner."
45(D) mandates that owner shall respond to any requests for consent or approval by tenant within 15 days, or the requested consent or approval shall be deemed given. [See Petitioner's 10 ¶¶ 45(A)(D)].
The Architect and Engineer hired by Respondent submitted plans to the Landlord for its approval. If the landlord required any changes to the plans, the changes would be made and a new set of plans would be submitted to the landlord for its approval. According to Ms. Frome the plans would be numbered sequentially, the first drawing having a lower number than the final drawing which would have a higher number. In accordance with this procedure plans were drawn, submitted to landlord for approval, filed with the Department of Buildings(DOB) and with the Land Mark Preservation Commission (LPC). Construction took place in accordance with those plans.
A dispute arose between the parties when Respondent was not able to have access to the entire rear yard of the building. Respondent brought an action in the Supreme Court to reform the contract and Petitioner served respondent with notices to cure which eventually resulted in the bringing of this Holdover Summary [*3]Proceeding. The Notice to Cure alleges that Respondent has defaulted under the lease by virtue of 14 lease violations as follows:
1- has failed to discharge a mechanic's lien in the amount of $5,950.00;
2- has failed to install the air conditioner units through the west basement windows as set forth in its plans in violation of paragraph 45(A);
3- has failed to paint the exterior of the rear facade of the premises with the colors set forth in its plans in violation of paragraph 45(A);
4-has failed to replace the front steps of the building with the bubble glass set forth in tenant's plans in violation of paragraph 45(A);
5- has failed to hook up the water pump to its electric meter as set forth in tenant's plans in violation of paragraph 45(A);
6-has failed to place the water spigot in the front of the building as set forth in tenant's plans in violation of paragraph 45(A);
7- has failed to keep the lobby and basement portions of the premises and the exterior thereof free from loud noises in violation of paragraph 57 of the lease;
8- has failed to keep the exterior of the premises odor free in violation of paragraph 57 of the lease;
9- has failed to remove tar bull from exterior wall above the skylights in the premises in violation of paragraph 45(A);
10- has failed to reattach properly the gutter down spout to the building drain in violation of paragraph 45(A);
11- has failed to place the blade sign on the west side of the entrance to the building as set forth in tenant's plans in violation of paragraph 45(A);
12- has failed to install the light on the westside rear door as set forth in its plans in violation of paragraph 45(A);
13- has failed to connect the sewer vent for the premises to the vent in the basement of the building as set forth in tenant's plans in violation of paragraph 45(A);
14- has affixed several signs inside the premises which are visible from outside the premises in violation of paragraph 5 of the Rules and Regulations attached to and made a part of the lease in accordance with paragraph 35 thereof.
Item 1 of the notice to cure has been cured, the mechanic's lien has been satisfied.
In its case in chief Petitioner presented the testimony of Respondent's architect, Karen Frome, and its mechanical engineer Jack Lifshitz. Both individuals stated that [*4]the alterations done to the building did not affect the structural integrity of the building. Ms. Frome laid the foundation for the introduction in evidence of the plans submitted by Respondent and offered in evidence by Petitioner. Ms. Frome stated that plans were submitted for approval, if changes needed to be made the same were made and then the plans were resubmitted for the landlord's approval. Following landlord's approval the plans were submitted to the Land Mark Preservation Commission and then to the Department of Buildings.[See Petitioner's 1,2,3,4,5,6 and Respondent's A in evidence].
Petitioner's 1 is a set of 2 drawings numbered LPC01 and 02.with the seal of the architect, showing that it was reviewed by the building owner on April 26, 2007, filed with the Department of Buildings and the Landmark Preservation Commission on June 1, 2007. This set of drawings shows an arrow indicating that duct work should be placed in the most Westerly window, not the middle window, and the most Easterly window. It states "repair bubble glass step-up to match existing condition", makes provisions for the color of the paint to be used, and the placement of the blade sign.
Petitioner's 2 is a set of 2 drawings numbered LPC01 and 02 brought in by the architect Ms. Frome and introduced as a business record. It does not contain her seal, It shows that it was reviewed by the building owner on April 26, 2007, filed with the department of buildings and the Landmark Preservation Commission on June 1, 2007. This set of drawings does not show arrows indicating mechanical duct work being placed through any of the windows. It states "Replace bubble glass in kind", makes provisions for the color of the paint to be used , and the placement of the blade sign.
Petitioner's 3 is a set of drawings numbered A00(cover sheet and general notes), A01 (Demolition plans) and A02 (construction plans). It is neither dated nor stamped. It has an indication in the margins stating it was reviewed by the building owner on January 4, 2007, filed with DOB and LPC on January 18, 2007 and amended on May 1, 2007. A00 is a plumbing diagram, A01 is a demolition plan and A02 is the construction plan for the first floor and the basement. These plans do not indicate where the A/C duct work is to be placed.
Petitioner's 4 is a set of drawings identical to petitioner's 3, however, these drawings contain the architects seal and signature and are date stamped approved by DOB It also contains a notation indicating these plans were again reviewed by the [*5]building owner on April 26, 2007. There is no indication on these drawings where the A/C ductwork is to be placed.
Petitioner's 5 is a Mechanical plan. It is neither dated nor signed. Petitioner's 6 is a reduction of Petitioner's 1.
Respondent's "A" is a Mechanical plan showing the duct work. It is stamped and signed by the engineer. On the margins it indicates it was reviewed by the building owner on January 4, 2007, filed with DOB and LPC on May 2, 2007 and approved on September 5,2007 by the Department of Buildings. This plan shows the A/C duct work going through the middle and Easterly windows. There is also a drawing showing where the air conditioning units and ducts are to appear. This is exactly as they appear in the pictures submitted by petitioner in evidence (See Petitioner's 11, 12, 13 & 15).
There are no Department of Buildings or Landmark Preservation Commission Violations filed against the building as a result of the work done by respondent. In accordance with the testimony of Karen Frome the venting of the air-conditioning duct work, the color of the paint, the repairing or replacing stair step nor the placing of the blade sign affect the structural integrity of the building. Ms. Frome, an architect, could not testify as to the plumbing systems or how they affect the integrity of the building. Mr. Lifshitz, a mechanical engineer whose specialty is Air Conditioning and duct work, stated that he is not familiar with plumbing systems because he is not a plumber. He was unable to testify as to the plumbing work performed and how that affected the structural integrity of the building. He also stated that the duct work was done in accordance with respondent's "A", the plan approved by the building owner, filed with the Department of Buildings and the Landmark Preservation Commission. Finally he stated that he is not aware of any Department of Buildings or Landmark Preservation Commission violations on the building as a result of the ducts being placed through the middle window.
The court affords great weight to Respondent's "A" which is the only exhibit in evidence dealing specifically with the Air Conditioning units and the duct work. It is also the one that Mr. Lifshitz most identified with and testified about, since he could not testify regarding the plumbing systems in the building. Mr. Lifshitz stated that the duct work was performed in accordance with this exhibit. This testimony is further corroborated by the pictures in evidence as petitioner's 11, 12,13 and 15. [*6]Placing the Air Conditioning units in this part of the building and placing the duct work through the middle window, as contained in Respondent's "A" has not resulted in any violations from the Department of Buildings or the Landmark preservation Commission, or had an adverse effect on the structural integrity of the building, as testified to by the architect Karen Frome. Placing the air conditioning units and ducts as depicted in these plans has not resulted in a violation of paragraph 45(A) of the rider to the lease, as this is not "an alteration that adversely affects the structural integrity of the building or building systems serving portions of the building located outside the premises."
The plans submitted had been reviewed by the landlord, the plans so indicate on the margin, and submitted to and approved by the Department of Buildings and the Landmark Preservation Commission. Although an exact dollar amount was not proven at trial, judging by the nature of the work performed involving the drafting of numerous plans for approval and filing, it is apparent that the Respondent spent a considerable amount of money in making these renovations. The work performed by Respondent has caused no injury to the premises.
Where the tenant has invested large sums of money in performing repairs to previously uninhabitable premises, the repairs are not structural in nature, do not adversely affect the structural integrity, and cause no injury to the building justice demands that the tenant not be subjected to an unreasonable forfeiture of the leasehold(Harar Realty Corp. V. Michlin & Hill, Inc., 86 AD2d 182, 449 NYS2d 213 [1st. Dept. 1982]; denying landlord possession after tenant installed staircase to connect third and fourth floors of premises, which was necessary for its business operations, without landlord's consent, when stairs could be removed and no injury to the premises was sustained).
The alleged violation dealing with the air conditioning and the placing of the ducts is the most serious and expensive violation alleged in the notice to cure. This court finds that petitioner has failed to prove a violation with respect to the air conditioning units and duct work as contained in its notice to cure item number 2.
Petitioner has failed to prove that the plumbing work was not done in accordance with the plans approved. It did not present testimony from an expert as to any deviation from the approved plans which affect the structure of the building or adversely affect building systems serving portions of the building. The two [*7]witnesses presented, Ms. Frome and Mr. Lifshitz, both stated that they have no knowledge of plumbing systems because that is not their specialty. The witnesses were not even able to read the drawings submitted. Mr. Lifshitz simply stated that he relied on the work done by the plumber, but could not indicate by reading the plans what work needed to be done in the premises. Petitioner has failed to prove any violations with respect to the plumbing systems as contained in its notice to cure items number 5,6 and 13.
Petitioner alleges in its notice to cure items 7 and 8 that Respondent has failed to keep the premises free from loud noises and odors. To prove this allegation it presents the testimony of tenants of the building. These tenants, Marcus Dochantschi, Offer Sharaby and J.P. Williams, testified as to their experience in the building after Respondent became tenant. Mr. Dochantschi stated that he never complained about the urine from dogs, which he sees three out of five days of the week. In his entire tenancy he has only seen dog excrement on three occasions and there is urine smell only during the summer. He sees Respondent clean in the morning and at the end of the day. The urine or barking do not affect his business. Mr. Sharaby stated that he was not inconvenienced by the urine or the dog barking, which he only hears when he enters the building but not on the fourth floor, where his office is located. Mr. Williams stated that he complained to the building owner and to Mr. Ziegler, Respondent's manager, but that the barking does not affect his business. He only hears the dogs when they are outside or when they are in the building's vestibule.
The court is mindful that this Respondent rented the space for a dog grooming business and is utilizing the space for the intended purpose. Petitioner cannot allege that Respondent is using the premises for an unintended purpose. Petitioner should expect its tenants to hear animal sounds coming from Respondent's premises because it is making use of the premises as permitted by the lease. It would be expected to hear dogs barking, to see dog urine and even excrements at times. As long as Respondent keeps the noises to a reasonable level and periodically, ideally three or four times a day, removes any urine , Respondent would be in compliance with paragraph 57 of the lease. The witnesses did not state that the condition at the building was such that it was having an adverse effect on their businesses or their health. Petitioner has failed to prove that Respondent's acts of allowing, at times, dog urine or excrement, or the noise of dogs barking has become a nuisance in violation of this paragraph. Petitioner has failed to prove the violation as alleged in its notice [*8]to cure item number 7 and 8.
Petitioner alleges in its notice to cure items 11, 12 and 14 that tenant has failed to place signs on the outside in the permitted place or remove signs inside that are visible from the outside, and has failed to install a light on the westside of the rear door. Paragraph 60 of the lease rider grants Respondent the right to put up signs inside or outside the premises and only places limits on the size of the sign placed outside the premises. This rider supersedes the printed form of the lease and the rules and regulations ( See lease Rider 69[o]). Respondent may place signs inside its premises whether they are visible from the street or not. Respondent may place a blade sign on the outside of the premises as long as it does not exceed 30 inches by 40 inches and as long as it complies with legal requirements. The placing of the blade sign on the westside of the entrance to the building or placing signs inside the premises visible from the outside are permitted by the lease rider and therefore are not violations of paragraph 45 of the lease. There was no testimony regarding the placing of a light on the westside rear door of the building. Petitioner has failed to prove these violations as alleged in its notice to cure.
Petitioner alleges in its notice to cure items 3,4,9 and 10 that Respondent has failed to paint the exterior rear facade of the premises with colors set forth in its plans, has failed to replace the front steps of the building with bubble glass, has failed to remove the tar bull from the exterior wall above the skylight and has failed to reattach properly the gutter down spout to the building drain. Petitioner has submitted sufficient evidence to prove these items of its notice to cure. It is left to this court to decide if these breaches of the lease are so material as to cause a forfeiture of the lease or if on the other hand they are so trivial or technical in nature as to prevent a substantial forfeiture of the lease ( See Brainerd Manufacturing Co., v. Dewey Garden Lanes, Inc., 78 AD2d 365, 435 NYS2d 417 [1st. Dept. 1981, finding failure to insure building to full replacement value a material breach warranting termination of the lease).
The court must look to see whether Respondent has substantially performed its covenants under the lease, and if the breaches are material, in order to effect a forfeiture granting possession to the Petitioner (City of New York v. Skyway-Dyckman, Inc., 22 AD2d 506, 256 NYS2d 840[1st. Dept. 1965]). To determine if there has been substantial performance the court must look to see if [*9]Respondent has fulfilled its obligations under the lease and looks to the following factors: Respondent is current in its rental obligations, has undertaken the renovation of the previously uninhabitable space at a considerable cost, there have not been any violations filed against the building by the Department of Buildings or the Landmark Preservation Commission as a result of the renovations, the alterations have not affected the structural integrity of the building or building systems serving portions of the building outside of the premises, there has been no injury to the landlord or the demised premises from Respondent's failure to strictly comply with the lease ( See Ogden v. Hamer, 268 A.D. 751,48 NYS2d 500 [1st. Dept. 1944] Where covenants are substantially performed and no injury results to the landlord for tenant's failure to strictly comply, tenant is not to be held for their breach; Vanguard Diversified, Inc., v. The Review Company, 35 AD2d 102, 313 NYS2d 269 [2nd. Dept. 1970]substantial performance is adequate performance so as to maintain tenant's rights under the agreement).
The lease is silent as to what constitutes a material breach of its provisions. This court considers the items proven at trial by petitioner to be non-material and deminimis, avoiding the forfeiture of such a valuable leasehold ( See Two Guys From Harrison-NY v. S.F.R. Realty Associates, 186 AD2d 186, 587 NYS2d 962 [2nd. Dept. 1992]; Helsam Realty Co., Inc., v. H.J.A. Holding Corp., 4 Misc 3d 64, 781 NYS2d 554[ App. Term 2nd. & 11th Jud. Dist.2004]; Marshall v. Ahamed, 5 Misc 3d 136(A), 799 NYS2d 161 [App. Term 2nd. & 11th Jud. Dists. 2004]).
Regardless of the immateriality of the breaches they should be corrected by Respondent. The court can order the correction of these inconsequential breaches (Louis and Anne Abrons Foundation, Inc., v. 29 East 64th Street Corp., 78 AD2d 814, 433 NYS2d 132 [1st. Dept. 1980]), and orders that the same shall be corrected within ninety(90) days from the date of service upon Respondent of a copy of this decision with notice of its entry.
There having been no prevailing party, neither party is entitled to attorneys fees.
CONCLUSION
This court finds Petitioner has failed to prove a prima facie case as to ten of the alleged violations in the notice to cure. Petitioner has substantially proven four of the [*10]violations, but this court finds such breaches of the lease to be immaterial. Respondent is granted ninety(90) days from the date of service of this decision with notice of entry to correct these inconsequential breaches. Respondent is to repair the step with in kind bubble glass, properly attach the gutter spout, pain where required in the appropriate color and remove the tar bull from the wall by the skylight. The Holdover petition is dismissed and the lease is reinstated. There being no prevailing party, attorneys fees are not awarded.
This constitutes the decision and judgment of this court.
Dated: May 22, 2009___________________________
Manuel J. Mendez
Judge Civil Court
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