Peyton v PWV Acquisition LLC

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Peyton v PWV Acquisition LLC 2012 NY Slip Op 30931(U) April 5, 2012 Sup Ct, New York County Docket Number: 111379/11 Judge: Anil C. Singh Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. [* 1] SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY %ION. Awrt C.SINGH SUPREME COURTJUSTXCE PRESENT: PART Justice 6\ MOTION DATE - v - \ MOTION SEQ. NO. MOTION CAL. NO. I rs, numbered 1 to were read on this motion to/for Notice of Motion/ Order to Show Cause Answering Affidavits Replying Affidavits Exhibits Affidavits - Exhibits ... - ~- - Cross-Motion: Check one: - - Li rJ Yes 1 No 7 INAL DISPOSITION FINAL DISPQSITION Check if appropriate: DO NOT POST SUBMIT QRDERI JUDG. ri n REFERENCE ri SETTLE ORDER/ JUDG. [* 2] DECISION AND OWEII -ag a i I 1st - Tndex No. 11 1 3 7 w I PWV ACQIJISTTlON I,T,C, P W V OWNER I,l,C, and JEWISI I 1-TOME LIFTK~AIIE, MANlIATTAN, HUN. ANTI, c . SINGT-T, J.: Plaintil ls are tenanls at I ark Wcst Villngc in Manhattan. Thc riders lo their leases givc thein assigncd parking spaces in outdoor parking lots at ~ - 7m ~ I OO d S lrcets. On July 2. I , 201 1 , inatiy of the plaintifis rcccived notices lkoiii their landlord, defendant I WV Acquisition 1 , I X ( I WV ), that tlicir cars were being rclocatcd to :in LindergroLind parking garage locatcd at 808 C olumbus Avcnuc. On Septeiiibcr 26, 201 1, P W V adviscd the tcnants that thc landlord had thc right to change assigned parking spaces undcr ;i rider l o the leascs. Ihe tcnants werc urgcd to contact management to make Ilnal arrangcnients for the transi cr without thc r i d for legal act i o 11 PWV sccks possession of thc 97 Strcct parking lot as part of a real estate l agc 1 01 11 [* 3] transaction with del cndant Jewish 1Ionic Lifccare ( Jewish I Ionic ). Under the dcal, the 97 Street parking lot will be convcyed to Jewish Home. A ncw nursing home and clder carc center will bc constructed on the 97 Streel parking lot. Ti1 exchangc, Jewish Home will transfer its propcrty located on 106 Street, which has valuable cievclopmenl rights, to defendant I WV Owncr LLC ( I WV Owner ). 1)WV Owner intends lo construct a high-risc residential building TJom e oii the pi-operty i t will receive lkoni Jewish * Plaintiffs move to onjoin defcndarits from terminating thcir parking lcasc riders and right to park in thcir currcnt parking spaccs or to climinate or I-clocateplaintiffs parliing spaces to the undcrground parking garagc at 808 Columbus Avenuc. L)el endants oppose the granting of injunctive relief, I n tlic cveiit injunctivc relief is granted, dcfcndants scelc a bond of at least llvc million dollars for tlic first year or, alternativcly, a hcaring on the amount of tlic bond. 1 0 bc grantod injunctive reliel: plaintiffs must establish a I ikclihoocl {)I- success o n thc merits and irrcparahlc iiijury in the evcnt the injunction is not granted (1J.S.Iie Companies, Inc. v . Schcerer, 41 A.L).3d 152, IS4 11 Dept., 2007]). l hecquitics must balance i n favor of the plainlil l s (Nobu Next Door, LI,C v. Fine Arls Housing!, Tnc., 4 N.Y .3d 839, 840 [ZOOS I). l hepuyose of an injunction is lo maintain the status quo to prevent thc dissipation of property so as not to rcnder any judgnicnt i11dfectud (Gluck v. Hoary, 5 5 A.D.3d 608, 668 [2d Dcpt., ZOOS]). In-junctivc reliei is not approprialc Page 2 of 1 I [* 4] whcrc money damagcs will makc plaiiitil fs wholc (Soiiicrs Associates, lnc. v. Corvino, 1 S6 A.D.2d 2 18, 2. I9 1I Dcpt., 19891). A bond is nccessary where irijunctivc d i e l is grantcd 2s 1 to sccurc dclkiidanls daiiiagcs i f it is ul tinialcly determined that 1111 injunction should not havc been granted (Ithilien Kcaltv Corp. v. 180 Liidlow Devclopmc~it T,I,C , 80 A.D.3d 455, 455 [ I s k p t . , 201 11). 1. Likclihood o f S~icccss the Merits on The three buildings at issue in this lawsuit - 784 Chlunibus Avenuc, 788 Coliimbus Avenue, and 792 C ~ ~ L I I I Avenue -- Iiavc liad parking since thcir I~LIS construction as reflcctcd in tlic rcspcctivc ccrtillcates of occupancy issiied in the latc 19SOs. PI-emotional material lor Purb West Village from thc carly 1%Os touts the avaiIal-,iIity of optional on-site parking. Today, only two lots remain a i d the - thc 97 Strccl lot abutting 784 Columbus AVCIIUC, Strcet lot in ii-ont of792 Colunibirs Avenue. J hcthird parking lot bordering 788 Columbus Avenue was utilized in 2006 to construct 808 ChluiiibLis Avenue. It is the site of thc undci-ground lot whcrc PWV sceks to relocalc plaintil&. Plaintiffs allcgc that they arc rcnt-stabilizcd tcnants with written arid oral leases for assigncd parking spaces at the 97 and 10C) hStreet parking lots. Thcy contend that the parking spaces are a required ancillary service and cannot be niodilied or substitulcd without llrst obtaining the approval of the Division o r Housing and Coiiimunity Re new a1 ( Dl 1CI< ). [* 5] 'l'he lCcnt Stabilidion Code (*blCK'.') dcliiies an ancillary scrvicc as "thosc required scrviccs not containcd within thu individual housing accommodations which thc ou'11cr was providing on the applicable base dalcs .... 'l'hcsc may include, bill are not limiled to, garagc rxilities" (RSC Section 2520.6 [r] 131). Ciaragc servicc providcd to tenants in conjunction with thc Icasing ofthcir apartments lhat is building-wide and not a service providcd t o ;-inindividual tenant is an ancillary scrvice (Matter 01' Netherland Operatine C'org. v. Eiiiiicke, 135 A.Il.2d 352, 352-353 11'' Jlcpt., 19x71). Plaintii'i's liavc cstablished h a t the parking splices provided to them at the 97"' and IOO"' Street lots arc ;i requircd ancillary scrvice. Parking spots werc available to tenants in the latc 1950s and thc carly I9OOs. The service was providcd prior to the base datc oi' May 3 1, 1968. RSC' Section 2522.S(c) provides thal H landlord may not modify or substitute a rcquired servicc without h t receiving approval by LIHC'R. Plaintiffs contciid that the change I'WV sccks to impose is a radical shirt in thc inaniicr by which lhc landlord dclivers parking scrvices to the tenants. 'l'licy lose tlicir convcnient aboveground lots, which are availablc to them on a twcnty-i'our hour basis. Instead, thcy will bc rcquired to I I I O V ~10 a less convcnient undcrground location accessible by rleva~or stnirwcll. Plaintiffs maintain that tlic room wlicre thc elevator or and stairwell is located is not scuire. I n thc cvciil the elevator is not functioning, the garngc is accessible only by stairs. The lot is opcratcd by Quik Park, an indepcndent [* 6] contractor which providcs valct parking. Plaintirk contend that h e y will have to wait for an hour to rctrievc thcir cars and tliat valet service will iiicrcasc their costs. Additionally, plaintiffs urge that undci- thcir current rent-stabilized leasc riders, PWV is required to providc parking. Howcvcr, tlie underground prirking lot is owned by 808 C.hlumbus, a condoniinium. Under its condominiuni declaration, rcsidents 01. 808 Columbus Avcnuc Iiavc ii preikrence. The parking spaces of non-residents can bc terminated upon thirty days notice. Therefore, plaiiitifl s could lose thcir spaces and be withou1 lcgal recoLirse against 808 Colunibus, which is not thcir landlord. Defendants urgc tlial the parking space ridcrs give PWV the cxprws right to relocate thc parking spaces. Iherefore, tlic tcnaiits current spaces may be lawfiilly nioved to tlic undergroirnd garage, and such ; i move does not constitute a reduction in scrvicc. In L~ct, plaintil f s will be provided an irpgradcd scciire parking Pxility upon llie same terms and conditions as their cxisting lease riders. Del cndants irrge that complaints by the plaintiffs arc dc niiniiiius. lhe minor inconvenience plaintirfs may experience docs no1 give rise to a reduction of scrvicc. Accordingly, T ICR T I intervention is nut warranted. I disagree. Plaintiff8 arc likcly to succeed on their claim that lhcir currcnt parking oii outsidc lots cannot be modificd without prior 111ICI< approvd. RSC Scclion 2523.5[e11.31 explicitly rcquircs that iiri owner may not iiiodify or substitutc a rcquircd service without f?rst obtaining approval from L)liCI<. Page 5 of 1 1 [* 7] In Charles 11. Cireenthal & Co. v. 301 E. 21 St. Tenants Assn., 91 A.D.2d 934, 935 (1 Dept. 1983), the landlord and iiianagitig agciil sought a preliniinaiy injunction to compel tcnanls to grant access to lhcir apaitiiiciils to allow the Inridlord to convert electricity from inastcr lo iiidividunl iiictcriiig. l hc court held that the initial dctcriiiination of what constitutes ;in csscntial scrvice, relevant to thc issuc here of whclhcr tlic coiivcrsioii from master to individual metering should bc approved, is a matter appropriately reserved to thc admiriistrntivc ngcncics, which have thc ncccssary expcrtisc and arc best cquippcd to disposc of thc issuc (citation omitted). Roth partics cilc lo DI ICR administrative determinatioris on llic issue of whctlicr an owiicr s attciiipt to change fron? a seK-pmk system to valct parking, or to nltcr the location of parking spots, constitutcs a modiflcation of 1-111essential scrvicc. Similarly, here, a full ndniinistrntivc rccord must he dcvclopcd before DHCK, thc agency with cxpcr-tisc aiid rcgulaloly authority, to determine whether PWV s attempt to movc thc tcnants from their current aboveground parking lots to an underground facility at a difl erent location constitutcs a11impcrmissiblc modification of services, or whclhcr it is B minor inconvenience a u t h o r i 4 by the lease riders. Plaintiff> will SLIfikr irreparable injury if a preliminary injunction is not granted. Llefendanls intend to niove plaintiilk to the underground parking facility to consumnintc the real cstate swap with the Iewish Home. Jewish liome intends to build its new facility 011 the 97 Street lot. l agc 6 of 1 1 [* 8] Ti DT-ICR ultimately dctcrmines that PWV may not modi@ the parking service it provides to plaintifrs by iiiovirig the tenanis to the underground 101 at a different location, plaintiffs may riot bc ablc to repossess their outdoor parking spots. When bul dozers start plowing through pavcnicnt and construction begins, the parking spaces wil be gone forcvcr. The legal right to a parking spacc as part o f a rent-stabili~cdlease in Manhattan is a valuable service. Money damages will not sulficc, 8s the tcnants current outdoor parking convenient to their hoiiics cannot be rcplaced. The sworn affidavits exhibitcd by plaintilTs clearly describe an irreparablc in-iury. Plaintiff Hillcl IIofl linan statcs in a sworn affidavit that thc clcvator from the vcstibirle to the 808 Ciaragc is olicn out of service. TIis wife is 69 years old, and hc is 71 years old. Ilis wifc 1x1s had two hip replacements. Although they can both currcntly walk the stairs to thc garage li-om the ground lcvcl, TTolTman is concerned that thcy iiiay not be ablc to do s o in the futurc, ;-is walking up and down stairs hccomes imoi-e difficult. Hollnian is worried about crime. 1Tc asserls that thc door to the clcvator and shirwell is not locked. l hcrcarc no security per so~i~~cl other pcrsonncl posted or any there. Accoi-ding to Hoffinan, thc arcade is dcsolatc at night. Anyone entcring the elevator/stnir i-ooi~i trappod there and vulncrablc to muggcrs. is Plaintif l Mary Lcc Haranger states that she is 8 I ycars old and lives alone. She does not waiit to surreiider her dcsignatcd parking spacc in the nearby outdoor lot because she LISCS her car frequently to bring her son and daughter-in-law and licr two Pagc 7 of 1 1 [* 9] grandchildrcn to her homc. This involves transporting several people and many things that go along with children aged Lour and ninc. Accordingly, shc needs to have hcr parking space just outside hcr building. Whcn the clcvator in the garage is out of ordcr, it will be hard for her to walk on thc ramp uscd by cars, especially in bad wcathcr. Plaintiff Maggi Peyton statcs in a sworn affidavit that shc invcstigatcd acccbs to the gamgc. She conlcnds that thc clevator was out of service; that t h u stairwell w:is dcsertcd; niid that she did not fccl safc walking lo the garagc in thc stairwell. When she sought access by tlic ramp uscd by cars for ingress and egress, shc round that the ramp has a very stcop incline that wo~ildbc impossible for a person to iiavigate crsing a walker. lhe cquities bnlancc iii favor ol plaintill s. On the oiic hand, granting an injunction might delay construction of buildings thal arc, at bcst, in the planning stage at this point. The dclay and iincertainty is caiised in part by PWV. Prior to cntering thc lalid swap with Jcwish Ho~iie, PWV could have brought administrative proceedings bcfore DHCR seeking a modification UL the ancillary parking service pi-ovidcd to plaintif-s. On t1ic othcr hand, dcnying an injunction would result in thc immedialc loss oi thc tenants assigncd parking spaccs to which [hey havc a prcsent lawful posscsso~y right. Plaintiffs only seck to maintain tlic status q u o pending DFTCIC s detei-mination as to whether PWV can riiodifi the curxnt parking servicc. J;iiially, wc turn to the bond issue. Thc lixing of the amount ol an underlaking is a iiiattcr within the sound discretion ofthe court. and will not he disturbed absent a n l age 8 of 1 1 [* 10] improvidcnt exercise of discretion (Txlckakis v. Kanianiis, 303 A.D.2d 380 [2d Dept., 2003 1). The amount of the undertaking niusl be rationally related lo the defendants potential damages if the preliminary injunction later provcs to h a w been unwarrantcd (Madison/T;iI lhAssociates T,I,C v. 184 I - I843 Ocean Parkway, LLC, 50 A.D.3d 533, 534 I 1 llcpl., ZOOS]). lts sulliciency dcpcnds upon the circumstnnccs of thc particular uasc (67A N.Y.Jur2d Injixnctions 172). I he amount of the uiidcrtaking must not be exccssive, and thc coi~-1 must not consider dcfcndants speculative or conclusory claiins of potcntial Ikancial losscs (IJiiieta v. 17uro-Quest Corp., 29 A.D.3d 895, 896 [2d Ilcpt., 20061; Shaff er v. Shaffer, 44 A.Tl.2~1 126 Ikpt., 19741); 7 Sensc v. Liu, 220 h.L).2d 725 215, 217 [I Dcpl., 19951). 11 is improper lo require, as a condition of a preliminary iniiinction, an imdcrtaking in ai1 amomt which would result in n denial of the relief to which the plaintiffs show themselves to he entitled (67 N.Y.Jur.2d In-junctioiis 172, citing Zonglielti v. Jerornack, I 50 A.D.2d S6 I (holding that plaintillk wcrc requircd to post orily $100,000 uiidcrtaking as prci-cquisik to granting injunctjvc 1-clief,not $740,000 undertaking originally rcquircd by trial court); scc also ModuEno v . Mcrritt-Chapman Scott Chrp., 17 Misc.2d 679 [Supreinc Ct., Special l enn,Queens Cty., l9S9J, and Hnrnuh Eaton Allcri Corp. v . International Business Machines Corp., 1980 WT. 4693 [Supreme Ct., Spccial l enn,Kings Cty., 19801). By thc sanic token, tlic amount of the bond must not be insufllcient. For examplc, [* 11] in Weitzeti v. 130 E. 65 Sl. Sponsor Curl?., 86 A.D.2d 51 1 [ I Dcpl., 19821, thc lrial court entered an ordcr granliiig plaintiff s motion for H preliminary injunction ~)roliibiting demolition of premises known as I30 East 65 Street iii Manhatlan and construclion of a 17-story buildiiig on the site, and directed h a t plaintiff file an undertaking in thc s~iin of $20,000. The First Lkpartmcnt modi lied the ordcr, linding that the amount of the undertaking fixed by the trial court was inadequate and should bc increased to $150,000. In the instant matter, clefcndants exhibit the swom dfidavit of Jeffrey Jhvjs, w h o slates that ho is thc properly rnnnager for Columbus Square Managcnienl. Hc contends that a n injuiiction would block deferidants devclopment and construction of a residcntial high-risc building, thcreby causing defendants i n ~ r tlian $297 million in lost profits, c resulting in concrcte losses of approximately $625,000 in expenscs alrc-ady incurred (Davis. All.., p. 2, para. 4). It is important to notc that ;I signi licant ainouiit ol rcgulatory work must takc place bchre construction can begin. Several cntitics, including thc Department 01 Huildings, the City Planning Commission, and the New York Stale Dcparlinent or Hcalth, niirst rtpprovc the project and issue permits. Jcwish I iome must also oblain a hank loan or other linancing before thc project u i i ~iiove forward. I n short, we find thal it would bc completely speculativc 10 rcqiiirc a bond in the sum of $5 million per yclir in light of the f acl that I-cgulatoiy approval and financing have not yet bcen f i n a l i d . Page 1 O o f 1 1 [* 12] We iiiust bcar in mind that plaintiffs do not havc unlimited fiinaiicial resourccs. Thc astronomical amount sought by defcndaiits would, i n effect, dciiy plaintiffs injunctive relid. The Court must bc carclirl to 1-ix tlic boiid in an amount that will not rcsult in the denial of the quitablc relicf' to which thc tcnants have shown theinsclvcs to bc cntitled. Undcr thc totality of the circumstances, plaintiffs shall post a bond in the amount or $7S,OOO. No issuc o f liict is raised requiring a hearing on the amount of the bond at this tiiiic. Accordingly, it is ORDERED that pending tlic tlnal rcsolution ofthis action, delkndants, their agcnts, servants, employccs aiid dl other persons acting under the jurisdiction, sLipervision and/or direction of dcl'tndants, are enjoincd and restraincd from tcrminnting plaintifli' parking leasc ridcrs and right to park in their current parking spaces or to eliminate or rclocatc phintirfs' parking spaces to Ihc underground parking garrngc :it 808 Columbus Avcnuc; and it is further (T)RDT:RI<Dthat plaintiffs within 30 days shall post with the Clcrk or the Court a bond in the slim of'$75,000 with sui'flcicnl surcty to scciire the daiiiagcs incurred by clclkndants lor the vacating o t l ; e l i ~ ~ ~ p r ~ l i i i i ~ ~ ~ if theycsuccccd , in vacating the ~uri ti~)n 'J 1 , :nn, v

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