Helmar Constr., Inc. v Basic Structure Eng'g
Annotate this CaseDecided on December 21, 2011
Supreme Court, Suffolk County
Helmar Construction, Inc., Plaintiff,
against
Basic Structure Engineering, Ed Ulrich and John Calixto, Defendants.
8353-07
LAW OFFICES OF SINGER & ROBINSON
Attorneys for Plaintiff
11 Middle Neck Road, Suite 310
Great Neck, New York 11021
FOSTER, VANDENBURGH & RIYAZ, LLP
Attorneys for Defendants
4 Montauk Highway
Westhampton, New York 11977
Elizabeth H. Emerson, J.
Upon the following papers numbered 1-13 read on this motion to renew and reargue ; Notice of Motion and supporting papers 1-6 ; Notice of Cross Motion and supporting papers; Answering Affidavits and supporting papers 7-11 ; Replying Affidavits and supporting papers12-13; it is,
ORDERED that this motion by the plaintiff for leave to renew and reargue so much of an order of this court dated July 20, 2011, as denied the branches of its prior motion which were for injunctive relief, is granted; and it is further [*2]
ORDERED that, upon renewal and reargument, the court adheres to its prior determination.
The plaintiff previously moved (1) for an order of attachment restraining the assets and property of the defendants Basic Structure Engineering ("Basic Structure") and Ed Ulrich up to the sum of $168,078.80; (2) for a preliminary injunction enjoining Ulrich from transferring, selling, or disposing of his ownership interest in Basic Structure and a related entity known as Basic Industries Glazing ("Basic Industries") and enjoining Basic Structure, Basic Industries, and Ulrich from transferring, selling, or disposing of any assets or property belonging to them; and (3) for an order directing Basic Structure and Ulrich to deposit $168,078.80 into court. In support thereof, the plaintiff argued in favor of the order of attachment, but presented
no arguments in favor of the other relief requested. By an order dated July 20, 2011, this court granted the branch of the motion which was for an order of attachment and denied the remainder of the motion as abandoned. The plaintiff now moves to renew and reargue its requests for injunctive relief. The plaintiff contends that the record supports its requests for such relief, which have not been abandoned.
The plaintiff alleges in its complaint, inter alia, that it entered into a contract on or about December 21, 2004, in which Basic Structure agreed to supply materials for installation by the plaintiff, a subcontractor responsible for curtainwall installation on a project known as the Queens Ambulatory Pavilion. The plaintiff alleges that Basic Structure and its owner, Ed Ulrich, breached their contractual duties by delivering defective and nonconforming goods, by failing to deliver goods properly and in a timely manner, by failing to deliver manufacturer's warranties, and by failing to account for monies paid to Basic Structure, among other things. The first cause of action is to recover damages for breach of contract. The second cause of action is for a permanent injunction directing Basic Structure and Ulrich to deliver manufacturer's warranties, as required by the contract. The third cause of action is to recover money paid to Basic Structure and Ulrich for the benefit of their suppliers and retained by them. The fourth cause of action is for an accounting of moneys paid to Basic Structure and Ulrich by the plaintiff and the general contractor in connection with the project.
This motion is governed by CPLR 6301, which provides, in pertinent part, as follows:
A preliminary injunction may be granted in any action where it appears that the defendant threatens or is about to do, or is doing or procuring or suffering to be done, an act in violation of the plaintiff's rights respecting the subject of the action, and tending to render the judgment ineffectual....
It is well settled that preliminary injunctive relief is not available to a party seeking money damages on a breach-of-contract claim (Dinner Club Corp. v Hamlet on Olde Oyster Bay Homeowner's Assoc., 21 AD3d 777, 778). In no proper or legal sense can a defendant do or permit an act in violation of the plaintiff's rights respecting the subject of the action in an [*3]action on a contract for the recovery of money only (Credit Agricole Indosuez v Rossiyskiy Kredit Bank, 94 NY2d 541, 545). The plaintiff in such an action has no rights against the property of the defendant until he obtains a judgment; and, until then, he has no legal right to interfere with the defendant's use and sale of the same (Id. at 545-546). Thus, a general creditor has no cognizable interest in or right to interfere with the use of the unencumbered property of a debtor until the creditor obtains a judgment (Dinner Club Corp., supra at 778), and the debtor's disposing of its assets, even rendering the anticipated judgment uncollectible, will not produce cognizable injury to the plaintiff and will not support a temporary injunction (Id.).
Although the inclusion of a money demand will not necessarily preclude an injunction if other relief that would satisfy CPLR 6301 is also sought, the court will refuse the injunction if convinced that a money judgment is the true object of the action and that all else is incidental (Credit Agricole, supra at 548). The court finds that the gravamen of the present action is a breach of contract and that the other relief requested is merely incidental to the primary relief sought, which is money damages. In the parlance of CPLR 6301, the "subject of the action" is the December 21, 2004, agreement between the plaintiff and Basic Structure.
The "subject of the action" is typically a specific res in which the plaintiff has a pre-existing interest (Dinner Club Corp., supra at 778). When the suit involves the plaintiff's claim to a specific fund, that fund is the subject of the action, and a preliminary injunction is appropriate under the express wording of CPLR 6301 (Id.). Here, the plaintiff seeks to enjoin Ulrich from transferring, selling, or disposing of his ownership interest in Basic Structure and Basic Industries and to enjoin Basic Structure and Ulrich from transferring, selling, or disposing of any assets or property belonging to them. Neither of these requests for relief involve a specific fund in which the plaintiff has a pre-existing interest (cf., Ma v Lien, 198 AD2d 186 [subject of the action was a discrete sum of money, i.e. a winning lottery ticket]).
The plaintiff also seeks or an order directing Basic Structure and Ulrich to deposit $168,078.80 into court. The record reveals that the $168,078.80 in question was received by Ulrich, Basic Structure, and Basic Glazing in settlement of an action commenced by one of their suppliers, Prelco, Inc., against Basic Structure and another. Basic Structure asserted a counterclaim in that action, which was commenced in Ontario Superior Court following the registration of a lien by Prelco against the library property in the City of Cambridge. While the $168,078.80 settlement is a specific fund, it is not a fund in which the plaintiff has a pre-existing interest. The plaintiff was not a party to the Ontario action, which involved a completely different project than the Queens Ambulatory Pavillion. The mere danger of asset-stripping is not a sufficient basis for injunctive relief (Credit Agricole, supra at 548). The plaintiff's remedy is an order of attachment, not an injunction (Id.). Since the plaintiff has already obtained an order of attachment, the court adheres to its previous determination and denies the branches of the plaintiff's prior motion which are for injunctive relief.
Dated:December 21, 2011
J.S.C.
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