International Plaza Assoc., L.P. v Lacher
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International Plaza Assoc., L.P. v Lacher 2012 NY Slip Op 31340(U) May 11, 2012 Supreme Court, New York County Docket Number: 110711/06 Judge: Debra A. James 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 PRESENT: - NEW YORK C O U N N DEBRA A. JAMES PART 59 Justice INTERNATIONAL PLAZA ASSOCIATES, L.P. Plaintiff, -v- Index No.: 110711/06 Motion Date: 12/Q2/11 Motion Seq. No.: MICHAEL A , LACHER, LAW O F F I C E of MICHAEL A. LACHER, LLP d / b / a LACHER & LOVELL - TAYLOR, Defendants 005 Motion Cal. No.: The following papers, numbered 1 to 3 were read on this motion for summary judgment. I .. 2 n Notice of Motion/Order to Show Cause -Affida Answering Affidavits - Exhibits PAPERS NUMBERED fXKitb Replying Affidavits - Exhibits Z 0 Upon the foregoing papers, The c o u r t shall consider herein plaintiff's motion for p a r t i a l summary judgment (Motion Seq. No. 5) against defendant Michael A. Lacher and defendants' motion to v a c a t e the note of issue (Motion S e q . No. 6). Plaintiff is the owner and landlord of the building located at 750 Lexington Avenue, New York, NY. Defendant professional corporation Law Office of Michael A. Lacher, LLP d/b/a Lacher Lovell-Taylor ("LLT") is a tenant in the building. Plaintiff alleges that by a written G u a r a n t y dated April 29, 2 0 0 3 , defendant Michael A. Lacher("Lacher"), personally and Check One: 0 FINAL DISPOSITION Check if appropriate: DO NOT POST NON-FINAL DISPOSITION 0 REFERENCE & [* 2] unconditionally-guaranteedall of LLT's obligations to plaintiff i t s prima facie entitlement to summary judgment on the underlying lease obligation, defendant Lacher as guarantor, is obligated to pay the debt. According to plaintiff, even if LLT hae expressly waived the right to assert any affirmative defenses belonging to LLT in any action brought to enforce t h e guarantee. The Guaranty reads in pertinent part Guarantor hereby unconditionally, irrevocably and as a primary obligor hereunder guarantees to Landlord, the full, prompt and faithful payment of all minimum rent, additional rent, and other sums due under the Lease as well as all sums payable under t h e Lease arising f r o m the holding over by Tenant after expiration or sooner termination of the term of the Lease and a l l damages and expenses caused by or arising out of such h o l d i n g over, including, without limitation, attorneys' f e e s and disbursements. - . This Guaranty is primary, absolute and unconditional and *shall not be discharged, mitigated, or affected by (1) any modification of the Lease; (ii) any failure of Landlord to enforce any of the provisions of the Lease or by any extension of time or indulgence extended by Landlord to Tenant hereunder; (iii) any defense available to Guarantor; or (iv) any invalidity or unenforceability of all or any portion of the Lease; . . . Landlord may proceed directly against Guarantor under this Guaranty without being required to proceed against Tenant under the Lease or to pursue or exhaust any o t h e r rights or remedies it may have against Tenant or against any o t h e r security or guaranty given to Landlord including, without limitation, the security deposit under the Lease, and the right to recover poesession of the premises, and/or Guarantor may be joined in any action or proceeding commenced by Landlord against Tenant in connection with the Lease. -2- [* 3] Defendants allege that Plaintiff has not made out a prima facie case for summary judgment and that pursuant to t h e terms of t h e Guaranty, the right to assert LLT's defenses challenging plaintiff's entitlement to alleged sums has not been waived by Lacher. Defendants also claim t h a t the Guaranty does not relieve plaintiff of its obligation to prove the underlying d e b t owed to L L T , since the underlying debt has not yet been proven in c o u r t or acknowledged as established by defendants. A p1aint;iff seeking summary judgment on a written guaranty must prove: 1) t h e existence of an absolute and unconditional guaranty; 2 ) t h e underlying d e b t ; and 3 ) t h e guarantor's failure to perform under the guarantee. Kensinston Home Co. v O r a m , 293 AD2d 304 ( l EDept 2004); Davirnos v Halle, 35 AD3d 2 7 0 ( l m t t Dept 2006). The Guaranty here by its v e r y terms is unconditional and there is no dispute that the defendant Lacher has not performed under t h e Guaranty. Plaintiff's documentary evidence is sufficient to establish that there is an underlying debt t h a t is the s u b j e c t of the Guaranty despite defendants' argument to the contrary. The Guaranty covers only "full, prompt and faithful payment of a l l minimum r e n t , a d d i t i o n a l rent, and other sums due under the Lease as well as all sums payable under t h e Lease arising from the holding over by Tenant." Although Lacher argues that plaintiff has failed to establish the debt, defendants do -3- [* 4] not submit any evidence to rebut the evidence submitted by plaintiff that the LLT failed to make timely rent payments in June 2006 and f a i l e d to replenish the security as required by the terms of t h e L e a s e . Once LLT failed to timely remit the rent due under the Lease, Lacher's Obligations under the Guaranty were triggered by the terms of the Guaranty which predicated the Guarantor's liability upon the failure of LLT to remit "full, prompt and faithful payment of all minimum rent, additional rent, and other sums due under t h e Lease." A s stated by t h e C o u r t , "[wlhile a guaranty is s u b j e c t to the fulfillment of any condition precedent to the liability imposed therein, t h e instant guarant[yl predicated the guarantor [ 'SI liability on the [ l e s s e e ] 's default in making payment, not on its default on t h e legal obligation to do so; any other interpretation would render the greater portion of the guaranties meaningless." Reliance Const. L t d . v Kennelly, 70 AD3d 418, 419 (' Dept 2010) (citations omitted). 1' The Guaranty signed by Lacher contains no contingency and is effective solely upon LLT's failure to promptly pay its Lease obligations. Based upon the First Department's holding in Reliance Const., plaintiff is entitled to summary judgment on the Guaranty based upon t h e amounts due under t h e Lease independent of t h e LLT's legal obligation t o pay amounts due under the Lease. -4- [* 5] Lacher's attempt to distinguish W i a n c e Const. is unavailing as in that case the trial c o u r t denied summary judgment based upon " t h e key issue . . . whether [the creditor] is actually owed any money to which the guarantee agreements apply" because there were issues of fact as to that question. Pellance Const. Ltd. v Kennelly (Index No.: 6 0 1 3 7 3 / 2 0 0 8 , Mot. Seq. 2, Sup Ct, NY County, December 16, 2008, Smith, J.). The Appellate Division reversed specifically distinguishing the right to payment upon a guaranty from t h e legal liability of a primary d e b t o r to pay the underlying debt and granted summary judgment upon an unconditional guaranty of payment irrespective of any defenses to payment the primary debtor possessed. 70 AD3d at: 419. Therefore, the c o u r t shall grant plaintiff partial summary judgment upon the Guaranty against defendant Lacher with t h e amount of damages to be determined at trial of this action. Defendants' separate motion to vacate the note of issue (Motion Sequence 06) on the basis that the certificate of readiness contained material rnisstaternentB as to whether discovery was complete shall be granted. Plaintiff filed the note of issue on June 1, 2 0 1 1 . Defendants a s s e r t t h a t key previously unknown information was revealed when plaintiff served a supplemental response to defendants' first set of interrogatories along with t h e note of issue. According to -5- [* 6] defendants, by waiting until t h e filing of the note of issue Lo disclose key information concerning plaintiff's alleged damages, plaintiff attempted to preclude discovery on those issues to the prejudice of the defendants. Defendants also claim that they served by hand-delivery a Notice of Deposition of Amy Chou on May 31, 2011, the day b e f o r e the Note of Issue was served by Plaintiff. Plaintiff opposes the motion to vacate the note of iseue stating t h a t Chou's name w a s disclosed in h e r affidavit regarding damages in support: of plaintiff's motion f o r partial summary judgment dated March 2 5 , 2011, and that defendants made no attempt to timely notice Chou's deposition in t h e months that: followed. Plaintiff does acknowledge that it was served with a deposition notice f o r Ms. Chou on May 31, 2011, the day before serving the Note of Issue. Plaintiff also alleges that defendants had more t h a n enough opportunity to timely notice a deposition of accounting personnel from plaintiff's managing a g e n t , Cohen Brothers Realty Corporation, whose name was provided years before. According to plaintiff, defendants have waived their belated requests for discovery. T h e court disagrees. Plaintiff received a notice for deposition for Chou at their counsel's office on May 31, 2011, one day before serving the note of issue. Therefore, its Certificate of Readiness asserting that there was no outstanding discovery was "blatantly false." Club -6- [* 7] -- I t a l i a . v Italian Faqhion Tradinq, Inc,, 2 6 8 A.D.2d 2 1 9 ( I E t Dept. 2000). Pursuant t o 2 2 NYCRR 5 2 0 2 . 2 1 ( e ) , the court finds that a material fact in the certificate of readiness is incorrect and the Note of Issue must be vacated. Finally, because t h e LLT s defenses in this action t u r n upon t h e contractual r e l a t i o n s h i p between the parties and f a c t s essential to plaintiff s claims, and t h e r e f o r e LLT s defenses, are in the exclusive possession of t h e accounting department of plaintiff s managing agent, the defendants are entitled to seek discovery thereupon. Defendants have a right to depose Chou or someone with personal knowledge of the facts in the Cohen B r o t h e r s Realty Corporation s accounting department. With r e s p e c t to defendant Lacher, discovery shall be limited to determining the amounts owed upon the Guaranty. Accordingly, it is ORDERED that the plaintiff s motion for p a r t i a l summary judgment is GRANTED on liability only with respect to defendant MICHAEL A . LACHER; and it is f u r t h e r ORDERED t h a t defendants motion to vacate the note of issue is GW4NTED and t h e C l e r k of the Trial Support Office is hereby directed to vacate t h e note of issue and strike the Case from the trial calendar pending the completion of outstanding discovery; and it is further -7- [* 8] ORDERED that the parties are d i r e c t e d to attend a status conference in IAS Part 59, NY 1 0 0 1 3 , on J u n e 5 , 2 0 1 2 , Room 103, 7 1 Thomas Street, New York, at 2 : 3 0 P.M. to set a schedule for the completion of outstanding discovery; and it is f u r t h e r I ORDERED that, w i t h i n 1 5 days f r o m completion of discovery as hereinabove d i r e c t e d o r b e f o r e such d a t e a s set by the court in any further order, t h e plaintiff shall cause t h e action t o be placed upon t h e trial calendar by t h e filing of a new n o t e of issue and statement of readiness and payment of t h e fee therefor. This is t h e decision and o r d e r of t h e court. Dated: May 11, 2 0 1 2 ENTER : -0-
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