Board of Directors of the Maidstone Landing
Homeowners Assn., Inc. v Maidstone Landing, LLC
2012 NY Slip Op 30973(U)
April 9, 2012
Supreme Court, New York County
Docket Number: 600438/07
Judge: Martin Shulman
Republished from New York State Unified Court
System's E-Courts Service.
Search E-Courts (http://www.nycourts.gov/ecourts) for
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This opinion is uncorrected and not selected for official
publication.
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4NED ON411212012
NEW YORK COUNTY
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J.S.C.
PRESENT:
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PART
Justice
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Index Number : 60043812007
MAIDSTONE LANDING HOMEOWNERS
vs.
-
MOTION DATE
MAIDSTONE LANDING LLC
SEQUENCE NUMBER : 003
MOTION SEQ. NO.
SUMMARY JUDGMENT
-
, were read on this motion4$for
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REFERENCE
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SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK: PART I
----_--__-_-____________________________-----------------------------X
THE BOARD OF DIRECTORS OF THE
MAIDSTONE LANDING HOMEOWNERS
ASSOCIATION, INC., suing on behalf of
its members, THE BOARD OF MANAGERS OF
THE MAIDSTONE LANDING CONDOMINIUM I,
suing on behalf of its unit owners, and
THE BOARD OF MANAGERS OF MAIDSTONE
LANDING CONDOMINIUM II, suing on behalf
of its unit owners,
Index No.: 600438107
DECISION AND ORDER
Plaintiffs,
-againstMAIDSTONE LANDING, LLC, WILBER FRIED,
DAVID FRIED, JUDITH FRIED, EXETER
BUILDING CORP., DOUGLAS R. SHARP and
BLOODGOOD, SHARP, BUSTER ARCHITECTS
AND PLANNERS, INC.,
Motion sequence numbers 003, 004 and 005 are consolidated for disposition. In
motion sequence number 003, defendants Maidstone Landing, LLC (Maidstone),
Exeter Building Corp. (Exeter), Wilber Fried (Wilberâ), David Fried (David) and Judith
Fried (Judith) (collectively, the 003 movants) move, pursuant to CPLR 3212, for
summary judgment dismissing the causes of action asserted against them
In motion sequence number 004, defendants Douglas R. Sharp (Sharp) and
Bloodgood, Sharp, Buster Architects and Planners, Inc. (Bloodgood) (together, BSB)
The caption indicates that this defendantâs name is âWilberâ but, internally, he is
called âWilbur.â For consistency, the court is referring to him as indicated in the caption.
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move, pursuant to CPLR 3212, for summary judgment dismissing all claims, cross
claims and counterclaims asserted against them.
In motion sequence number 005, plaintiffs move, pursuant to CPLR 3212, for: ( I )
summary judgment on their first through fifth causes of action asserted against
Maidstone and Exeter; and (2) summary judgment on their ninth2cause of action for
breach of fiduciary duty against Wilber, Judith and David.
BACKGROUND
Plaintiffs are suing for property damage allegedly resulting from defendantsâ
failure to construct the condominium units in a workmanlike manner, thereby breaching
the contract with the homeowners. Plaintiffs assert that because of shoddy
construction the units suffered severe leaks and water damage.
The complaint asserts 14 causes of action: ( I ) breach of contract (the purchase
agreement) against Maidstone; (2) breach of contract with respect to the recreational
facilities against Maidstone; (3) breach of warranty (the purchase agreement) against
Maidstone; (4) breach of limited warranty against Maidstone; (5) breach of warranty with
respect to the recreational facilities against Maidstone; (6) negligent misrepresentation
against Wilber, David, Judith and Maidstone; (7) fraud in the inducement against
Wilber, David, Judith and Maidstone; (8) fraudulent concealment against Wilber, David,
Judith and Maidstone; (9) breach of fiduciary duty against Wilber, David and Judith;
(IO) aiding and abetting a breach of fiduciary duty against Maidstone; (I I)
violations of
General Business Law (GBL) 95 349 and 350 against Wilber, David, Judith and
Plaintiffsâ motion incorrectly identifies the cause of action for breach of fiduciary
duty as the eighth cause of action.
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Maidstone; (12) breach of contract against BSB; (13) fraud against BSB; and (14)
negligent misrepresentation against BSB
Maidstone, the condominiumâs sponsor, promulgated the offering plan for the
sale of 44 homes in Condominium I and 38 homes in Condominium II and organized
the Maidstone Landing Homeowners Association, Inc. (HOA) to own, operate and
maintain the condominiumâs recreational and common areas facilities, including the
homes, swimming pool, tennis courts, beach and clubhouse building. Motion 003, Exs.
E and F. As indicated in the offering plan (Motion 003, Ex. D), Maidstone was to retain
control of the board of directors (board) until 95% of the homes were conveyed, as well
as control of the board of managers (managers) of Condominium I and II until 95% of
the homes in each phase was sold. Id.
Maidstone extended to each individual purchaser a limited warranty, which
warranted the construction quality of the individual units against latent defects in the
heating, ventilation, air conditioning, plumbing and electrical systems within the
individual homes, as well as latent major structural defects. The limited warranty states,
in pertinent part:
LIMITED WARRANTY. Seller herein makes no housing merchant implied
warranty or any other warranties, express or implied, in connection with
the Purchase Agreement or home covered hereby and all such warranties
are excluded, except as provided in the Limited Warranty annexed hereto
as Schedule â1â. The terms of the Limited Warranty are hereby
incorporated into this Purchase Agreement and there are no warranties
which extend beyond the face thereof. Purchaser hereby acknowledges
that a written copy of the terms of the annexed Limited Warranty has been
provided by Seller to Purchaser for Purchaserâs examination and that a
reasonable period of time for its examination by Purchaser has been
afforded to Purchaser prior to the time of Purchaserâs execution of the
Purchase Agreement. Purchaser understands and accepts the annexed
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warranty to the Purchase Agreement in lieu of any other express or
implied warranties in connection with this transaction . . .
Motion 003, Ex. K. The limited warranty further provides that it:
. . . is in lieu of and replaces all other warranties on the construction and
sale of the home and its components, both express and implied (including
any warranties of merchantability or fitness for a particular purpose).
There are no warranties which extend beyond the face hereof. The
purpose of this Limited Warranty is to identify the Sellerâs responsibilities
for construction defects of a latent or hidden nature that could not have
been found or disclosed on final inspection of the home.
Motion 003, Ex. L. The limited warranty expressly states that it was given to the original
homeowner and did not extend to subsequent purchasers. Id.
The limited warranty offered coverage for one year for latent defects consisting
of defective workmanship by the Seller, defective materials provided by the seller,
defective design provided by the architect or other design professional and defective
installation of appliances. The limited warranty offered coverage for two years for major
system coverage and six year coverage for major structural defects based on defective
workmanship, materials or design. Id.
In addition, the limited warranty specifically excluded from the six-year coverage:
Damage to the following non-load bearing portions of the Home are not
covered by this six (6) year coverage: roofing and sheathing; dry wall and
plaster; exterior siding; brick, stone and stucco veneer; floor covering
materials; wall, tile and other wall coverings; non-load bearing walls and
partitions; concrete floors in attached garages and basements that are
built separately from the foundation walls or other structural elements of
the Home; electrical, plumbing, heating, cooling and ventilation systems;
appliances, fixtures and items of equipment; paint; doors and windows;
trim, cabinets; hardware; and insulation.
Id. In order for Seller to be obligated under the limited warranty, a step-by-step claims
procedure must be followed:
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a. Written notice of any warranty claim must be made on the attached
âNotice of Warranty Claim Formâ and must be received by Seller no later
than the tenth day after the expiration of the applicable warranty period.
Such notice must be sent by Purchaser to Seller by certified or express
mail, return receipt requested. If this form shall not properly be completed
and received by Seller by that deadline, the Seller will have no duty to
respond to any complaint or demand contained in such form, and any and
all claims may be rejected. COMPLETION AND DELIVERY OF SUCH
NOTICE OF WARRANTY CLAIM IN A TIMELY MANNER IS
NECESSARY TO PROTECT THE RIGHTS OF THE PURCHASER
UNDER THIS LIMITED WARRANTY.
Id. Moreover, pursuant to t h e provisions of the limited warranty:
8. Leqal ActiQns.
a. No claim under this warranty may be commenced or asserted against
Seller in any lawsuit unless a properly completed Notice of Warranty
Claim Form has been received by the Seller in the time period set forth in
paragraph 7 of this warranty.
b. No lawsuit against the Seller under this warranty may be commenced
more than thirty (30) days after the expiration date of the applicable
warranty coverage, or thirty (30) days after Seller has given written notice
of its rejection of Purchaserâs claim with respect to such claim, or thirty
(30) days after builder has substantially completed corrective action for a
defect with respect to such defect.
Id. Coverage for common elements was deemed to be given to the managers. Id.
The purchase agreement contains a merger clause, which states:
Anything to the contrary herein contained notwithstanding it is specifically
understood and agreed by the parties hereto that the acceptance of the
delivery of the deed at the time of the closing of title hereunder shall
constitute full compliance by the seller with the terms of this agreement
and none of the terms hereof, except as otherwise herein expressly
provided, shall survive delivery and acceptance of the deed. All
representations contained in the Offering Plan shall survive delivery of the
deed. All parties hereto do hereby agree that trial by jury in any action,
proceeding or counterclaim arising out of or from this Agreement is hereby
waived.
Motion 003, Ex. K.
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The offering plan contains the following warranties with respect to the common
elements:
Regarding the Common Elements the Sponsor will correct any defects in
the construction of the Common Elements, or the installation or operation
of any mechanical equipment therein, due to improper workmanship or
material substantially at variance with this Offering Plan provided and on
condition that Sponsor is notified of or becomes aware of such defect(s)
within twelve (12) months of the date of substantial completion of the
defective portion(s) of the Common Elements. The question of
construction shall be comparable to the local standards customary in the
particular trade and in accordance with the Plans and Specifications.
Motion 003, Ex. D.
Construction of the homes comprising Condominium I began in 2000 and by
April 8, 2002, 95% of those homes had been conveyed. Title to 95% of the homes
comprising Condominium II was conveyed by October 16, 2003. Motion 003, Ex. M.
The summons and notice for the instant action was filed on June 4 , 2007. By October
16, 2003, Maidstone had transferred control of the board to the unit owners, with Wilber
being the only remaining sponsor member of the six-member board. Motion 003, Ex. N.
By letter dated August 13, 2003, counsel for HOA advised Maidstone that
several defects and/or omissions had arisen as a result of the planning and
construction of the homes. Motion 003, Ex. 0. A list of the items needing to be
addressed was attached to this letter, most dealing with individual units and some
concerning the common element clubhouse and walkway lampposts. Id. The 003
movants maintain that they attempted to address these issues and indicate that
plaintiffsâ complaints to the Attorney General about those alleged defects never resulted
in any enforcement proceedings, civil penalties or mandated remedial work.
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The 003 movants aver that Maidstone contracted with Exeter to act as the
general contractor for the construction of the condominiums. While Wilber is Exeterâs
chief executive officer (Motion 003, Ex, Q), the entities maintain separate books and
records.
Motion sequence number 003
The 003 movants contend that the causes of action ss rting breaches of
warranty are time-barred by the limited warrantyâs provisions because those claims are
based on alleged defects covered by either the one- or two-year coverage period. The
latest time for filing the instant action, based on those defects, would have been in
October 2005. Since plaintiffs instituted this lawsuit in 2007, the 003 movants argue
that the first, second, third, fourth and fifth causes of action must be dismissed.
The 003 movants state that Maidstone and Exeter are separate entities,
maintaining separate books and records, and Maidstone cannot be considered to be
Exeterâs alter ego as plaintiffs allege. Since the complaint makes no specific allegation
against Exeter, except that Exeter is a member of Maidstone, the 003 movants maintain
that the complaint must be dismissed against Exeter. In addition, the 003 movants
argue that there was no contract between Exeter and plaintiffs, thus no privity exists
between Exeter and plaintiffs upon which to assert liability.
The 003 movants also claim that the ninth and tenth causes of action alleging a
breach of fiduciary duty and aiding and abetting a breach of fiduciary duty are barred by
the three-year statute of limitations because plaintiffs are only seeking monetary
damages.
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The 003 movants maintain that no breach of the purchase agreement may be
maintained because of the merger clause, so that only claims based on a breach of the
limited warranty may be posited. The 003 movants claim that the breach of warranty
claims are time-barred by the provisions of the limited warranty, so that all of the first
five causes of action must be dismissed. Further, no evidence of an agreement
regarding recreational facilities has been provided and the 003 movants assert that
there is none. In support of this contention, the 003 movants submit a portion of the
deposition of Mark Manzi, a member of HOAâs board, who testified that he does not
know of any documents or contracts between HOA and Maidstone concerning any
recreational facilities. Motion 003, Ex. R.
Lastly, the 003 movants aver that any claim against Wilber as Maidstoneâs alter
ego must be dismissed because there is no evidence that he dominated and controlled
Maidstone so as to perpetrate a wrong or an injustice.
BSB submits an affirmation in partial support of the 003 movantsâ motion to the
extent that the motion seeks to dismiss the complaint. BSB state that they oppose any
motion on the 03 movantsâ part for summary judgment on any cross claims asserted
against them; however, the court notes that the instant motion only seeks to dismiss the
complaint and makes no mention of the cross claims.
In opposition to motion sequence number 003, plaintiffs contend that their
breach of warranty claims do not preclude their breach of contract claims because they
are separate and apart from the obligations appearing in the limited warranty.
Plaintiffs also state that the breach of warranty claims are not time-barred
because most of them fall within the six-year coverage period, and there are separate
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warranties for the common elements, which are not limited by the time limitations noted
in the 003 movantsâ arguments. It is plaintiffsâ position that Wilber, an experienced
developer who admitted that he was on site almost every day during construction,
should have been aware of the defects forming the basis of this lawsuit, and no written
notice is required for alleged defects in the common elements.
Plaintiffs reiterate their arguments originally posited in the earlier motion this
court decided regarding Wilber, David and Judith owing plaintiffs fiduciary duties. As
was previously determined, this cause of action was deemed viable because of the
fiduciary obligations condominium board members owe to the unit owners.
It is plaintiffsâ position that Wilber, David and Judith were aware of the conditions
that form the basis of this lawsuit and failed to address them during the time that they
controlled the board for selfish motives: to benefit themselves financially as the owners
of Maidstone and Exeter. Moreover, plaintiffs assert that Maidstone aided and abetted
Wilber in his breach of fiduciary obligations.
With regard to the seventh cause of action, plaintiffs insist that they may
maintain a cause of action for fraudulent inducement based o n what they claim were
affirmative misrepresentations. Plaintiffs also state that Maidstone, Wilber and Exeter
may be held individually liable for these misrepresentations. However, this courtâs prior
order, as amended, dismissed this cause of action against Wilber, Judith and David.
Plaintiffs also claim that their cause of action for violation of GBL 5s 349 and 350
should not be dismissed because the offering plan was sufficiently consumer oriented
to come within the purview of the statute.
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Plaintiffs admit that there is no separate recreational facilities agreement, but
that those facilities are included in the offering plan and are, therefore, subject to the
same terms indicated therein.
In reply, the 003 movants state that the seventh and eighth causes of action
should be dismissed as to Maidstone. As previously noted, these causes of action
were dismissed as against Wilber, Judith and David. The 003 movants also argue that
GBL §§ 349 and 350 are inapplicable to private, single-shot transactions. Otherwise,
the 003 movants reiterate their arguments previously discussed.
Motion sequence number 004
BSB (the architects) argue that the causes of action asserted against them
a
should be dismissed based on: (I)lack of privity between them and plaintiffs; (2) the
fact that they had no control over the means and methods of construction; and (3) their
designs were within the standard of care for architects in New York.
On January 13, 1995, BSB entered into a contract with Exeter for arc I itectural
design services. Motion 004, Ex. I. This contract stated, in pertinent part:
TASK I-PRELIMINARY GRADING PLAN:
ARCHITECT will prepare a preliminary grading plan based on he refined
concept plan. This is not an engineering drawing. The grading plan is
intended to be used to guide the site engineering and to illustrate grade
changes across the site relative to building floor elevations and road
slopes.
TASK II-SITE CROSS SECTION
ARCHITECT will prepare a site cross section through the center of the
site (the interior hillside area) in order to study the relationships of floor
elevations, building height roof lines, and view potentials from this area.
The cross-section will be based on TASK I preliminary grading
information.
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Id. In addition, the contract stated â[ilt is recognized that the ARCHITECT does not
have control over the cost of labor, materials or equipment, over [Exeterlâs methods of
determining construction prices or over competitive bidding.â ld. Further, the contract
provides that it was not to be considered an engineering drawing.
In 1998, BSB and Exeter entered into a second contract, wherein BSB was to
provide âBasic Architectural Services,â including schematic design services, design
development services and construction document services of buildings to be built at the
condominium complex, including duplex townhouses, a clubhouse and a pool area. Id.
According to this contract, BSB did not have oversight of the construction, nor was it
responsible for the means and methods of construction. Id.
The architects state that at no time during the construction phase did they ever
receive any complaints regarding water leaks. David S. Sieglinger (Sieglinger), the
owner of the company that acted as the construction manager for the condominium
project, was deposed in this matter and affirmed the architectsâ statements regarding a
lack of notice of any leaks. Motion 004, Ex. G. Further, according to the testimony of
Manzi, the Architectural Review Committee of the Maidstone Homeowners Association
never made any complaints to the architects regarding their design.
The architects maintain that they never entered into any contracts with plaintiffs,
nor has any individual unit owner ever complained to them about their designs.
Moreover, the architects state that they have never had any direct communication with
any of the plaintiffs.
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In support of their contentions, the architects provide expert reports attributing
the unit ownersâ alleged problems to construction defects rather than any architectural
design defects. Motion 004, Ex. N. In addition, the architects provide the expert
affidavit of Alan Ritchie, AIA, who opines, with a reasonable degree of architectural
certainty, that the architectsâ work was within the standard o f care for architects in
planning and drafting. Motion 004, Ex. P. Lastly, the architects assert that the cross
claim asserted against them for common-law indemnification and contribution should be
dismissed if any wrongdoing is attributable to Maidstone andlor Exeter.
The 003 movants oppose only that portion of the architectsâ motion seeking
dismissal of the cross claims for indemnification and contribution. According to the 003
movants, pursuant to the terms of their contract with Exeter, the architects were
required to be on the job site during construction and notify them if there was any
deviation in the architectural plans or work was not being performed in accordance with
the contracts. The 003 movants argue that, since wrongdoing has yet to be
determined, it would be premature to dismiss their cross claim for indemnification.
Further, the 003 movants argue that since plaintiffs have alleged damages relating to
the architectsâ work, the claim for contribution qualifies as tort damages and injury to
property, allowing the 003 movants to seek contribution.
In reply to the 003 movantsâ opposition, the architects claim that the contract
between them and Exeter provides that:
. . . because architect is not providing construction observation services,
[Exeter] shall hold architect harmless and shall indemnify and defend
architect from and against any and all claims . _ .arising out of or resulting
from the project except that his indemnification shall not bar any claims
[Exeter] may have against the architect, the damages resulting from the
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architectâs negligent work in performing his duties specified under this
agreement. [Exeter] shall hold the architect harmless from all legal claims
against this work except for those where liability has been adjudicated by
a court of law.
Motion 004, Ex. I. The architects assert that this contractual provision entitles them to
indemnification and contribution from the 003 movants, not the other way around. In
addition, the architects note that, according to the 003 movantsâ own experts, no design
defects were found with their drawings, plans or designs. Motion 004, Ex. K. Nor do
these experts attribute any wrongdoing to the architects. Id.
Lastly, the architects refer to their contract with Exeter which states that, whereas
the architects were obligated to visit the site to determine, in general, whether the work
was being performed in accordance with the contract, they were ânot required to make
exhaustive or continuous site inspections to check the quality or quantity of work
,.+,
and
shall not be responsible for [the failure of any contractor] to carry out the work in
accordance with the contract documents.â Motion 004, Ex. I. Hence, the architects
maintain that the cross-claims for indemnification and contribution asserted against
them should be dismissed.
In opposition to the architectsâ motion, plaintiffs argue that BSB are liable for
misrepresentations in the offering plan, regardless of any privity of contract between the
eventual unit owners and these defendants as the architects. In addition, plaintiffs aver
that questions of fact exist as to whether the architectural designs were reasonable, and
they challenge the conclusory opinion of BSBâs architectural expert.
In reply, the architects state that all of the expert affidavits and reports indicate
that there were no design defects in their work and that any problems plaintiffs face
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would have been the result of shoddy building and construction techniques. Plaintiffs
fail to refute these experts with contradictory expert opinions of their own.
Consequently, the architects maintain that plaintiffsâ causes of action against them must
be dismissed.
The architects point out that they never provided an architectâs certification for
the offering plan, merely an architectâs report, and, even if there were privity of contract
between them and plaintiffs, there is no evidence that they breached their contractual
obligations to provide appropriate architectural designs. The architects again argue that
since they were not responsible for the means and methods of construction they cannot
be held liable for construction defects.
Motion sequence number 005
The arguments plaintiffs present in their motion are essentially the same
arguments they present in opposition to the 003 movantsâ motion and thus do not
require reiteration. Similarly, the 003 movantsâ opposition is, in sum and substance, the
same arguments they present in their main motion (motion sequence 003) and also will
not be restated. Plaintiffsâ reply reiterates their previous arguments and oppositions.
DISCUSSION
âThe proponent of a summary judgment motion must make a prima facie
showing of entitlement to judgment as a matter of law, tendering sufficient evidence to
eliminate any material issues of fact from the case [internal quotation marks and citation
35
omitted].â Santiago v /=;/stein, AD3d 184, 185-186 (I st Dept 2006). The burden then
shifts to the motionâs opponent to âpresent facts in admissible form sufficient to raise a
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genuine, triable issue of fact.â Mazurek v Metropolitan Museum ofArt, 27 AD3d 227,
228 (1st Dept 2006); see Zuckerman v City of New York, 49 NY2d 557, 562 (I 980). If
there is any doubt as to the existence of a triable fact, the motion for summary
judgment must be denied. See Rotuba Extruders, Inc. v Ceppos, 46 NY2d 223, 231
( I 978).
Motion sequence numbers 003 and 005
The first, third and fourth cquses of action.
These causes of action assert claims against Maidstone for breach of contract
with respect to the purchase agreement and breaches of the limited warranty
associated therewith. Those portions of the 003 movantsâ motion (motion sequence
number 003) and plaintiffsâ motion (motion sequence number 005) seeking summary
judgment on these causes of action are denied.
The court agrees with plaintiffs that these causes of action are not barred by the
provisions of t h e limited warranties in the purchase agreement because they allege
specific provisions of the agreement in addition to those covered by the warranties.
Tiffany at Wesfbury Condominium v Mare//;Dev. Corp., 40 AD3d 1073, 1076 (2d Dept
2007). Plaintiffs allege that the 003 movants failed to âcomply with all the applicable
city, state and federal laws, administrative rules and regulations (Motion 003, Ex. A),
which is a violation of a specific covenant appearing in the purchase agreement.
Therefore, plaintiffs are entitled to assert a breach of contract cause of action.
Further, the warranties covering the common elements are not subject to the
time limitations and notice requirements of the warranties associated with the individual
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units. Therefore, any alleged breach of those warranties is subject to a six-year
statutory period, which had not run when the present action was commenced. See
Gallup v Summerset Homes, LLC, 82 AD3d 1658 (4th
Dept 201 I ) .
However, questions of fact exist as to whether Maidstone âbecame awareâ of the
problems within 12 months after substantial completion of the project, since the HOAâs
August 13, 2003 letter referenced above did not specify all o the alleged defects that
f
form the basis of this lawsuit. Moreover, even assuming that Maidstone had timely
notice of the alleged problems, as stated in this courtâs earlier decision, there is a
divergence of opinion between the experts as to the existence and/or the degree of the
alleged defects. These conflicting expert reports raise issues of fact (Frobose v
Weiner, 19 AD3d 258 [Ist Dept 2005]), and â[wlhen experts offer conflicting opinions, a
credibility question is presented requiring a juryâs resolution.â Shields v Bakfidy, I 1
AD3d 671, 672 (2d Dept 2004). â[Tlhe weight to be afforded the conflicting testimony of
experts is a matter particularly within the province of the jury [internal quotation marks
and citation omitted].â Gleeson-Casey v Otis El. Co., 268 AD2d 406, 407 (2d Dept
2000). Accordingly, based on the foregoing, the branches of both motions seeking
summary judgment on these causes of action must be denied.
The second and fifth causes of action.
The portion of the 003 movantsâ motion (motion sequence number 003) seeking
summary judgment dismissing the second and fifth causes of action is granted. Thus,
the portion of plaintiffsâ motion (motion sequence number 005) seeking summary
judgment on these same causes of action must be denied.
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The second cause of action alleges a breach of the recreational agreement and
the fifth cause of action alleges breach of warranty thereon. However, it is undisputed
that there was no separate agreement covering those facilities, which were
incorporated into the purchase agreement. Therefore, these causes of action are
duplicative of the first cause of action and thus are dismissed.
The sixth. seventh and eiqhth causes of action.
By prior decision dated January 8, 2009, this court granted Wilberâs cross-motion
dismissing the sixth, seventh and eighth causes of action against him. Thereafter, this
court amended its January 8, 2009 decision and order to reflect that these causes of
action were also dismissed as to co-defendants Judith and David. However, the same
reasons articulated in that decision apply equally to defendant Maidstone.
Consequently, that portion of the 003 movantsâ motion (motion sequence number 003)
seeking summary judgment on the sixth, seventh and eighth causes of action against
Maidstone is granted and those causes of action are dismissed as to that defendant.
The ninth cause of action.
That portion of the 003 movantsâ motion (motion sequence number 003) seeking
summary judgment dismissing the ninth cause of action is granted as asserted against
David and Judith, and the portion of plaintiffsâ motion (motion sequence number 005)
seeking summary judgment on the ninth cause of action is denied.
As this court previously stated, Wilber, Judith and David, as members of the
board of managers of the condominium association, owed a fiduciary obligation to the
unit owners. Caprer v Nussbaurn, 36 AD3d 176 (2d Dept 2006). However, the court
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agrees with the 003 movants that this cause of action is time-barred. As held in
Kaufman v Cohen, 307 AD2d 113, 118 (I Dept 2003):
st
New York law does not provide any single limitations period for breach of
fiduciary duty claims. Generally, the applicable statute of limitations for a
breach of fiduciary claims depends upon the substantive remedy sought
[citations omitted].
When the only relief sought is money damages, courts have held that the threeyear statutory period of CPLR 9214 (4) applies. IDT Corp. v Morgan Stanley Dean
Witter & Co., 12 NY3d 132 (2009). Since Judith and David relinquished their seats on
the board in or about September 2003 and the instant action was not commenced until
2007, this cause of action is time-barred. The court did not consider this issue in its
prior decision regarding this cause of action because it was not previously raised.
However, from t h e arguments presented, it appears that Wilber retained his seat
on the board until May 17, 2004, which is less than three years prior to this lawsuitâs
commencement. See Westchester Religious Insf. v Karnerman, 262 AD2d 131 (1st
Dept 1999). Questions of fact exist as to whether Wilber, as a member of the board,
knew of the alleged defects and failed to remedy them in order to benefit himself as the
owner of Maidstone and Exeter. Thus, this cause of action cannot be dismissed
against him.
The tenth cause of action.
The only remaining portion of the ninth cause of action is that portion asserted
against Wilber. As stated in Sanford/Kissena Owners Corp. v Daral Props., LLC, 84
AD3d 1210, 1212 (2d Dept 2011):
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One who aids and abets a breach of a fiduciary duty is liable for that
breach, even if he or she had no independent fiduciary obligation to the
allegedly injured party, if the alleged aider and abettor rendered
substantial assistance to the fiduciary in the course of effecting the
alleged breach of duty.
As further stated in Monaghan v Ford Motor Co., 71 AD3d 848, 850 (2d Dept 2010):
Substantial assistance [to a breach of fiduciary duty] occurs when a
defendant affirmatively assists, helps conceal or fails to act when required
to do so, thereby enabling the breach to occur [internal quotation marks
and citation omitted].
Here, there is no evidence indicating that Maidstone provided such âsubstantial
assistanceâ to any alleged breach of fiduciary duty. Consequently, the portion of the
003 movantsâ motion (motion sequence number 003) seeking summary judgment
dismissing the tenth cause of action against Maidstone is granted.
The eleventh cause of action.
That portion of the 003 movantsâ motion (motion sequence number 003) seeking
summary judgment dismissing the eleventh cause of action is granted. GBL 5 349
prohibits â[dleceptive acts or practices in the conduct of any business, trade or
commerce or in the furnishing of any service in the state.â GBL § 350 declares unlawful
â[flalse advertising in the conduct of any business, trade or commerce or in the
furnishing of any service in this state.â
The 003 movants argue that this cause of action is pre-empted by GBL Article
23-A, which grants the Attorney General the exclusive authority to investigate and
prosecute false or fraudulent representations contained in a publicly disseminated
condominium offering plan. CPC Intl. Inc. v McKesson Corp., 70 NY2d 268 (1987). In
Thompson v Parkchester Apts. Co. (271 AD2d 31 1, 31 1 [ I s tDept 2000]), the court held
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that those plaintiffs failed to âset forth a viable claim under [GBL] 3 349 since they have
not met the threshold requirement for such a claim by showing that the alleged
deceptive acts, if permitted to continue, would have a broad impact on consumers at
large.â See also Devlin v 645 First Ave. Manhattan Co., 229 AD2d 343 (Ist Dept 1996).
In the case at bar, plaintiffs have also failed to establish that the alleged
deceptive practices have an impact on consumers at large. Moreover, although a
recent decision held that a condominium association may maintain a private cause of
action pursuant to these sections of the GBL for breach of contract, negligence or fraud
(Bridge St. Homeowners Assn. v Brick Condominium Devs., LLC, 18 Misc 3d 1 128[A],
2008 NY Slip Op 50221(U) [Sup Ct, Kings County 20081, citing 511 W. 232âd Owners
Corp v Jennifer Realty Co., 98 NY2d 144 [2002]), plaintiffs have failed to plead fraud
with sufficient particularity or to submit evidence of fraud sufficient to sustain this cause
of action. Nor have plaintiffs proffered evidence of negligence or breach of contract
sufficiently to warrant maintaining this cause of action. Hence, the eleventh cause of
action must be dismissed.
Motion sequence number 004
This motion concerns the last three causes of action plaintiffs assert against the
architects and the 003 movantsâ cross-claim for indemnification and contribution against
them.
The twelfth cause of action.
That portion of the architectsâ motion seeking summary judgment on the twelfth
cause of action is granted. There is no dispute that there never was a contract entered
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into between plaintiffs and the architects. However, plaintiffs allege, in sum and
substance, that they are the third-party beneficiaries of the contracts entered into
between the architects and Exeter. An examination of those agreements indicates that
the architects never expressly agreed that their services were intended to benefit third
parties and plaintiffs thus lack the ability to enforce those contractual provisions. Board
of Mgrs. of Riverview at College Point Condominium 111 v Schorr Bros. Dev. Corp., 182
AD2d 664 (2d Dept 1992); see also Key lntl. Mfg., lnc. v MorsdDiesel, lnc., 142 AD2d
448 (2d Dept 1988). Plaintiffs cannot maintain this cause of action against the
architects because they were not in privity with them. M. Paladino, lnc. v J. Lucchese &
Son Contr. Corp., 247 AD2d 51 5 (2d Dept 1998).
However, even assuming that plaintiffs could maintain this claim, based on the
evidence presented this cause of action would still be dismissed. Not a scintilla of
evidence has been adduced that establishes, or even brings into question, any acts of
architect malpractice.
The architects have met their burden by establishing that all the expert opinions
provided by all parties indicate that the cause of the alleged problems was faulty
construction. They also submit an expert affidavit opining that they did not deviate from
standard architectural practice. Although plaintiffs challenge the architectsâ expertâs
opinion, they have âfailed to meet [their] burden to adduce credible expert testimony
that [the architectslâs plans and specifications deviated from locally prevailing standards
of architectural practice.â Tower Bldg. Restoration, lnc. v 20 E. gthSt. Apt. Corp., 7
AD3d 407,408 (I Dept 2004).
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Moreover, the architects provide documentary and testimonial evidence that they
were not responsible for the means and methods of Exeterâs and/or Maidstoneâs work.
Therefore, they cannot be held liable for any injuries resulting therefrom. See generally
Zolofar v Ben Krupinski, Gen. Conk., Inc., 36 AD3d 802 (2d Dept 2007). Based on the
foregoing, the twelfth cause of action against the architects is dismissed
The thirteenth cause of action.
The portion of the architectsâ motion seeking summary judgment dismissing the
thirteenth cause of action against them for fraud is also granted. As stated in Friedman
â
v Anderson (23 AD3d 163, 166 [I Dept 20051):
â[a] mere recitation of the elements of fraud is insufficient to state a cause
of actionââ (National Union Fire Ins. Co. of Pittsburgh, Pa. v Christopher
Assoc., 257 AD2d 1 [1999]). Furthermore, a plaintiff seeking to recover
for fraud and misrepresentation is required âto set forth specific and
detailed factual allegations that the defendant personally participated in,
or had knowledge of any alleged fraudâ (Handel v Bruder, 209 AD2d 282,
282-283 [1994]).
CPLR 3016 (b) requires that the complaint set forth the misconduct complained of in
sufficient detail to clearly inform each defendant of what his or her respective role was
in the alleged deception.
In the instant matter plaintiffsâ fraud allegations are conclusory and lack sufficient
particularity to satisfy CPLR 3016 (b)âs requirements. The mere assertion that the
contracting parties did not intend to meet their contractual obligations does not convert
a cause of action for breach of contract into one for fraud. See 767 Third Ave. LLC v
Greble & Finger, LLP, 8 AD3d 75, 76 (let
Dept 2004); Modellâs N.Y. Inc. v Noodle
Kidoodle, lnc., 242 AD2d 248 (Ist 1997).
Dept
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The fourteenth cause of action.
That portion of the architectsâ motion seeking summary judgment dismissing the
fourteenth cause of action against them for negligent misrepresentation is granted. âIt
is settled that a claim arising out of an alleged breach o contract, here, the [offering
f
plan], may not be converted into a tort action absent the violation of a legal duty
independent of that created in the contract.â Givoldi, lnc. v United Parcel Sew., 286
AD2d 220, 221 (IatDept 2001); Board of Mgrs. of Rivewiew at College Point
Condominium 111 v Schorr Bros. Dev. Corp., 182 AD2d 664, supra. Since no
independent legal duty has been sufficiently alleged, this cause of action against the
architects is dismissed.
The CrQSsclaim$,
That portion of the architectsâ motion (motion sequence number 004) seeking
summary judgment dismissing the cross claims against them for indemnification and
contribution is granted. Not only is contribution unavailable to the 003 movants under
the economic loss doctrine (Galvin Bros., lnc. v Town ofBabylon, 91 AD3d 715 [Zd
Dept 20121; Sound Refrigeration & Air Conditioning, lnc. v All City Testing & Balancing
but
Corp., 84 AD3d 1349 [2d Dept 201 I]), there is no evidence that the architects are in
any way liable for the alleged construction defects. All of the evidence indicates that
the problems were associated with faulty construction, which was out of the architectsâ
control. Therefore, the 003 movants are not entitled to indemnification as well.
For all of the foregoing reasons, it is hereby
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ORDERED that the portion of defendants Maidstone Landing LLC, Wilber Fried,
David Fried, Judith Fried and Exeter Building Corp.âs motion for summary judgment
(motion sequence number 003) seeking to dismiss the first, third and fourth causes of
action is denied; and it is further
ORDERED that the portion of defendants Maidstone Landing LLC, Wilber Fried,
David Fried, Judith Fried and Exeter Building Corp.âs motion for summary judgment
(motion sequence number 003) seeking to dismiss the second, fifth, sixth, seventh,
eighth, tenth and eleventh causes of action is granted and said causes of action are
dismissed; and it is further
ORDERED that the portion of defendants Maidstone Landing LLC, Wilber Fried,
David Fried, Judith Fried and Exeter Building Corp.âs motion for summary judgment
(motion sequence number 003) seeking to dismiss the ninth cause of action is granted
as asserted against David Fried and Judith Fried only and is denied as to Wilber Fried;
and it is further
ORDERED that Douglas R. Sharp and Bloodgood, Sharp, Buster Architects and
Planners, Inc.âs motion for summary judgment (motion sequence number 004) is
granted and the complaint and cross claims asserted against them are severed and
dismissed, with costs and disbursements to said defendants as taxed by the Clerk of
the Court upon submission of an appropriate bill of costs, and the Clerk is directed to
enter judgment accordingly in favor of said defendants; and it is further
ORDERED that plaintiffsâ motion (motion sequence number 005) seeking
summary judgment on their first through fifth and ninth causes o f action is denied in its
entirety.
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The parties are directed to proceed to mediation as previously scheduled.
The foregoing is this court's decision and order. Courtesy copies of this decision
and order have been sent to counsel for the parties.
Dated: April 9, 2012
/--
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