434 Suffolk Ave. Realty, Inc. v Incorporated Vil. of Islandia

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[*1] 434 Suffolk Ave. Realty, Inc. v Incorporated Vil. of Islandia 2012 NY Slip Op 50502(U) Decided on March 19, 2012 Supreme Court, Suffolk County Emerson, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on March 19, 2012
Supreme Court, Suffolk County

434 Suffolk Avenue Realty, Inc., ROBERT M. WESOLOWSKI, Individually and as Principal of 434 SUFFOLK AVENUE REALTY, INC., and MICHAEL M. WESOLOWSKI, Individually and as a Principal of 434 SUFFOLK AVENUE REALTY, INC., Plaintiffs,

against

The Incorporated Village of Islandia, ALLAN M. DORMAN, Individually, and as Mayor and Trustee of the Incorporated Village of Islandia, NEIL J. MUNRO, Individually and as Deputy Mayor and Trustee of the Incorporated Village of Islandia, DIANE F. OLK, Individually, and as Trustee of the Incorporated Village of Islandia, HENRY B. BRADLEY, III, Individually and as Trustee of the Incorporated Village of Islandia, DARRYL B. SAMPLES, Individually and as Trustee of the Incorporated Village of Islandia, OMNIPOINT FACILITIES NETWORK 2, LLC, d/b/a OMNIPOINT COMMUNICATIONS, INC., a subsidiary of VOICESTREAM WIRELESS CORPORATION, and NEXTEL OF NEW YORK INC., d/b/a NEXTEL COMMUNICATIONS, Defendants.



28939-07



DONALD J. KING, ESQ.

Attorney for Plaintiffs

75 East Main Street

P.O. Box 304

Kings Park, New York 11754

SILLS CUMMIS & GROSS P.C.

Attorneys for Defendant Omnipoint Facilities Network 2, LLC

One Rockefeller Plaza

New York, New York 10020

SILER & INGBER, LLP Attorneys for Defendant Village of Islandia

301 Mineola Blvd.

Mineola, New York 11501

BROWN RUDNICK LLP

Attorneys for Defendant Nextel of New York, Inc.

Seven Time Square

New York, New York 10036

Elizabeth Hazlitt Emerson, J.



Upon the following papers numbered 1-116 read on these motions for summary judgment ; Notice of Motion and supporting papers 1-45; 88-102 ; Notice of Cross Motion and supporting papers; Answering Affidavits and supporting papers 46-53; 54-62; 63-81; 103-115 ; Replying Affidavits and supporting papers 82-87; 116 ; it is,

ORDERED that the motion by the plaintiffs (002) for an order striking the answer of the defendant Darryl B. Samples and granting summary judgment in their favor against the remaining defendants on the issue of liability is denied; and it is further

ORDERED that the motion by the individual defendants and the Incorporated Village of Islandia (004) for summary judgment dismissing the complaint insofar as it is asserted against them is granted.

The plaintiffs are the owners of a parcel of real property located in the Incorporated Village of Islandia (the "Village"). In the summer of 2003, a representative of the defendant Omnipoint Facilities Network 2, LLC, d/b/a Omnipoint Communications, Inc. ("Omnipoint"), contacted the plaintiffs to discuss leasing their property and building a telecommunications tower thereon in order to eliminate a service gap in Omnipoint's network. On October 22, 2003, the plaintiffs and Omnipoint entered into a "Site Lease with Option," which gave Omnipoint an option to lease the plaintiff's property for an initial term of five years plus five additional five-years terms. Omnipoint exercised its option and commenced the initial five-year term on October 20, 2004.

In February 2004, Omnipoint applied to the Village for a special-use permit to erect a telecommunications tower on the plaintiff's property. The Village forwarded Omnipoint's application to its third-party engineers, Cashin Associates, P.C. ("Cashin"). Cashin reviewed the application and, by a letter dated April 15, 2004, advised Omnipoint of several issues that needed to be addressed before approval could be granted. Among them were the height of the proposed telecommunications tower and the corner side yard set-back, for which variances were required, the height of the fence and the use of barbed wire. By a letter dated March 9, 2005, Omnipoint filed an amended application addressing the points raised by Cashin in its letter dated April 15, 2004. Cashin reviewed the amended application and found that it did not comply with the Village's code because variances were required for height, the corner side yard, and the fence, and because the use of barbed wire less than eight feet from the ground was prohibited. The Village forwarded Cashin's findings to Omnipoint by a letter dated April 5, 2005, along with a Board of Appeals application, which was required for relief from the Village code. By a letter dated April 15 2005, Omnipoint's attorney sought a meeting with the Village attorney to discuss [*2]the need for variances because his review of the Village code had led him to conclude that variances were not required. Throughout 2004 and 2005, work on the plaintiffs' property proceeded in order to comply with the Village's requirements. By a letter dated October 26, 2005, Omnipoint requested that a final inspection of the required drainage work be scheduled and that the Village proceed with its review of Omnipoint's application without further delay.

On July 15, 2005, the plaintiffs entered into a site-lease agreement with the defendant Nextel of New York, Inc., d/b/a Nextel Communications ("Nextel"), to lease a 600 square-foot portion of the plaintiffs' property. The Nextel lease referred to the telecommunications tower to be built by Omnipoint, and the parties acknowledged that Nextel contemplated entering into an agreement with Omnipoint to license a portion of the tower in order to install equipment thereon. The term of the Nextel lease was five years from August 1, 2006, plus Nextel had the right to extend the term for three consecutive five-year periods. In October 2005, Omnipoint submitted a revised special-use permit application to the Village that included Nextel as a co-locator on the telecommunications tower to be built on the plaintiffs' property.

In December 2005, the Village received a letter from Suffolk Towers, Inc. ("Suffolk Towers"), a company in the business of site development for wireless communications networks. Suffolk Towers sought to lease ground space from the Village to develop as a telecommunications site. In March or April 2006, Suffolk Towers advised Omnipoint that the Village was going to rezone a parcel of real property owned by the Village for commercial/industrial use and that the parcel would be available for the construction of a telecommunications tower thereon. Suffolk Towers planned to lease the parcel from the Village and inquired of Omnipoint, whose application for a special-use permit to erect a telecommunications tower on the plaintiffs' property had been pending for more than two years, whether it was interested in becoming an occupant of the proposed tower on the Village's property. On April 25, 2006, the Village passed a resolution authorizing it to enter into a lease with Suffolk Towers for the Village's property, which was located only 175 feet away from the plaintiff's property.

On May 15, 2006, Omnipoint and Nextel, as co-applicants with Suffolk Towers, applied for a special-use permit to construct a telecommunications tower on the Village's property (the "Suffolk Towers application"). By a letter dated May 18, 2006, Omnipoint withdrew its prior application to construct a tower on the plaintiffs' property. Cashin reviewed the Suffolk Towers application and recommended several modifications before approval could be granted. Cashin's recommendations were forwarded to Suffolk Towers by a letter dated June 23, 2006. On July 11, 2006, the Village adopted a resolution finding that the proposed tower on its property would have no significant environmental impact. By a letter dated July 17, 2006, the Village notified Omnipoint's attorney that a public hearing on the Suffolk Towers application was scheduled for August 29, 2006. By a letter dated August 15, 2006, Omnipoint notified the plaintiffs that it was exercising its right to terminate the Site Lease with Option effective November 15, 2006. By a letter dated August 18, 2006, the plaintiffs were notified of the public hearing on August 29, 2006. The plaintiffs appeared at the hearing and objected to the Suffolk Towers application on [*3]the ground that there was a prior application for a telecommunications tower on their property. The matter was tabled in order for the Village's attorney to investigate the plaintiffs' claim. The Suffolk Towers application was approved after it was discovered that the prior application had been withdrawn.

Given the close proximity of the plaintiffs' property to the Village's property, once the tower on the Village's property was approved, the coverage gap was closed, and there was no need to erect a second tower on the plaintiffs' property. Nextel continued to pay the plaintiffs rent through the end of the initial five-year term of its lease, but did not exercise its right to extend the lease for an additional five-year term. Omnipoint, which had notified the plaintiffs that it was terminating its lease, continued to pay the plaintiffs rent through November 15, 2006.

The plaintiffs subsequently commenced this action against the Village, its Mayor and Trustees, Omnipoint, and Nextel. The plaintiffs contend that, as a result of the defendants' actions, they have been deprived of revenues under the Omnipoint and Nextel leases during their initial terms, as well as during the extended terms thereof, and that they have been deprived of revenues from other wireless communications carriers who would have rented space on Omnipoint's tower. The complaint contains causes of action for breach of contract against Omnipoint and Nextel and causes of action for tortious interference with contract, tortious interference with prospective economic advantage, private nuisance, denial of equal protection, prima facie tort, actual fraud, and constructive fraud against the Village, its Mayor and Trustees (collectively "the Village defendants"). The plaintiffs move for an order striking the answer of the defendant Darryl B. Samples and granting summary judgment in their favor against the remaining defendants on the issue of liability. Omnipoint, Nextel, and the Village defendants respectively move for summary judgment dismissing the complaint insofar as it is asserted against them. By separate orders dated March 19, 2012, the Omnipoint and Nextel motions are decided herewith. The motions by the plaintiffs and the Village defendants are decided herein.

The Village defendants contend that they are immune from liability because the decision to issue a permit is discretionary in nature and the actions of the government in such instances are immune from lawsuits (see, City of New York v 17 Vista Assoc., 84 NY2d 299, 307; Sposato v Village of Pelham, 275 AD2d 364, 365). While that may be true, the record reveals that the Village never granted or denied a permit on the plaintiff's property. Thus, the Village never exercised its discretion.

The plaintiffs contend that monetary damages may be imposed against a municipality when its actions are ministerial in nature. The plaintiffs contend that the Village's actions may be characterized as ministerial because the Village code imposes upon the Village a duty to review preliminary site plans and approve them, disapprove them, or approve them with modifications within 90 days of receiving a completed application. The record does not reflect that Omnipoint's application on the plaintiff's property was ever completed. Additionally, liability may not be imposed against a municipality for ministerial actions unless there is a duty that runs from the municipality to the plaintiff, and not just to the public generally (McLean v City of NY, 12 [*4]NY3d 194, 202-203).

The Court of Appeals has recognized a narrow class of cases in which a duty is born of a special relationship between the plaintiff and the governmental entity (Pelaez v Seide, 2 NY3d 186, 198-199). A special relationship can be formed in one of three ways: (1) when the municipality violates a statutory duty enacted for the benefit of a particular class of persons, (2) when it voluntarily assumes a duty that generates justifiable reliance by the person who benefits from the duty, or (3) when the municipality assumes positive direction and control in the face of a known, blatant, and dangerous safety violation (Id. at 199-200).[FN1] The court finds that the plaintiffs have failed to meet their heavy burden of establishing a special relationship (Id. at 199).

Violation of a statute resulting in injury gives rise to a tort action only if the intent of the statute is to protect an individual against an invasion of a property or personal interest (Lauer v City of New York, 95 NY2d 95, 101). To form a special relationship through the breach of a statutory duty, the governing statute must authorize a private right of action (Pelaez v Seide, supra at 200). In the absence of explicit legislative direction, one may be fairly implied when (1) the plaintiff is one of the class for whose particular benefit the statute was enacted, (2) recognition of a private right of action would promote the legislative purpose of the governing statute, and (3) to do so would be consistent with the legislative scheme (Id). All three prongs of this test must be recognized before a private right of action can be recognized (Signature Health Center, LLC v State of New York, 28 Misc 3d 543, 550 [and cases cited therein]).

Even assuming that the plaintiffs are persons for whose especial benefit the Village code was enacted, they cannot establish the third prong of the test, which is the most critical and the most difficult to establish (Id.). The Village code provision upon which they rely provides that the penalty for the failure to act on a preliminary site plan within 90 days of receiving a completed application is that the site plan is considered approved. A private right of action will not be recognized if doing so would conflict with, or be inconsistent with, the enforcement mechanism that was expressly included in the legislation (Id., citing McLean v City of NY, supra at 200). Considering that the Village code gives no hint of any private enforcement remedy for money damages, the court will not impute one to the lawmakers (see, Mark G. v Sabol, 93 NY2d 710, 720-721).[FN2] [*5]

The Village never assumed a duty to act on the plaintiffs' behalf. The voluntary assumption of a duty requires (1) an assumption by the municipality, through promises or actions, of an affirmative duty to act on behalf of the injured party, (2) knowledge on the part of the municipality's agents that inaction could lead to harm, (3) some form of direct contact between the municipality's agents and the injured party, and (4) that party's justifiable reliance on the municipality's affirmative undertaking (Id.; Pelaez v Seide, supra at 202). The direct-contact and reliance requirements are particularly important since they rationally define and limit the class of persons to whom the municipality's special duty extends (Lauer v City of New York, supra at 102). It is undisputed that the plaintiffs had no direct contact or communications with the Village defendants until the public hearing on the Suffolk Towers application. Moreover, the plaintiffs point to no promises or assurances by which the Village assumed an affirmative duty to do something on their behalf and on which they relied.

In view of the foregoing, the court finds that no special relationship was formed between the plaintiffs and the Village. Additionally, the plaintiffs have failed to establish a prima facie case with respect to each of the causes of action asserted against the Village defendants.

Tortious Interference with Contract

The plaintiffs contend that the Village tortiously interfered with their leases with Omnipoint and Nextel. In order to recover damages for tortious interference with contract, a plaintiff must establish: (1) the existence of a valid contract between the plaintiff and a third-party, (2) the defendant's knowledge of that contract, (3) the defendant's intentional procurement of the third party's breach of that contract without justification, (4) actual breach of the contract, and (5) damages resulting therefrom (Lama Holding v Smith Barney, 88 NY2d 413, 424).

The record reveals that it was Suffolk Towers who contacted the Village to build a telecommunications tower on the Village's property, and there is no evidence in the record that the Village had any direct contact with Omnipoint or Nextel regarding the Suffolk Towers application. In fact, the record reflects that the Mayor and Trustees did not know who would be occupying the tower on the Village's property when they passed a resolution authorizing the Village to enter into a lease with Suffolk Towers. While the Village had at least constructive knowledge of the application by Omnipoint to build a telecommunications tower on the plaintiffs' property, the record does not reflect that the Omnipoint application was ever completed so that the Village could hold a hearing and vote on it. By the time the Village approved the Suffolk Towers application, the prior Omnipoint application had already been withdrawn. The court finds that, under these circumstances, the Village did not intentionally procure a breach of the plaintiffs' lease with Omnipoint.

Breach of contract has repeatedly been listed among the elements of a claim for tortious [*6]interference with contract (NBT Bancorp v Fleet/Norstar Fin. Group, 87 NY2d, 614, 621 [and cases cited therein]; see also, Lama Holding v Smith Barney, supra at 424; Beecher v Feldstein, 8 AD3d 597, 598). In granting the motion for summary judgment by Nextel, this court has determined that Nextel did not breach its lease with the plaintiffs.

In view of the foregoing, the Village defendants are entitled to summary judgment dismissing the first cause of action for tortious interference with contract.

Tortious Interference with Prospective Economic Advantage

When there has been no breach of an exiting contract, but only interference with prospective contract rights, the plaintiff must show more culpable conduct on the part of the defendant ( NBT Bankcorp, supra at 621). Generally, the defendant's conduct must amount to a crime or an independent tort (Carvel Corp v Noonan, 3 NY3d 182, 190). If it does not, the plaintiff can still recover if the defendant engaged in conduct for the sole purpose of inflicting intentional harm on the plaintiff or if the defendant used wrongful means (Id. at 190-191). When the alleged interference is motivated, at least in part, by economic self interest, it cannot be characterized as solely malicious, and the plaintiff must demonstrate that the means employed by the defendant were wrongful (Out of the Box Promotions v Koschitzki, 55 AD3d 575, 577). "Wrongful means" has been defined as physical violence, fraud or misrepresentation, civil suits and criminal prosecutions, and some degrees of economic pressure (Carvel Corp., supra at 191). Moreover, the conduct must be directed, not at the plaintiff, but at the party with whom the plaintiff has or seeks to have a relationship. Under New York law, in order to make out a claim of tortious intereference with prospective economic advantage the defendant must direct some activities toward a third party (Id.).

The plaintiffs cannot maintain their cause of action for tortious interference with prospective economic advantage for several reasons. First, it is duplicative of the prior, nonviable cause of action for tortious interference with contract insofar as the plaintiffs allege that the Village interfered with the Omnipoint and Nextel leases. Second, the plaintiffs have failed to identify any third parties with whom they would have had or sought to have a business relationship but for the Village's conduct. Third, the plaintiffs have failed to identify any conduct by the Village that amounted to a crime or independent tort directed at a third party. Fourth, the Village was motivated, at least in part by economic self interest. The Mayor and Trustees testified that they approved the tower on the Village's property in order to increase the Village's revenues and lower taxes. Fifth, the plaintiff has failed to demonstrate that the Village used any wrongful means that were directed at a third party, and the plaintiffs' claims of fraud cannot be sustained (see, infra). Accordingly, the Village defendants are entitled to summary judgment dismissing the second cause of action for tortious interference with prospective economic advantage.

Private Nuisance [*7]

A private nuisance is an invasion of another's interest in the use and enjoyment of land that is intentional and unreasonable, negligent or reckless, or actionable under the rules governing liability for abnormally dangerous conditions or activities (Copart Indus. v Consolidated Edison Co. of NY, 41 NY2d 564, 569). The plaintiffs contend that the Village defendants' actions were an intentional and unreasonable invasion of their property that deprived them of the ability to use the property as they would otherwise have been able to use it. An intentional invasion of another's interest in the use and enjoyment of land is unreasonable if the harm is significant and the actor's conduct is (a) for the sole purpose of causing harm to the other or (b) contrary to common standards of decency (Restatement [Second] of Torts § 829).[FN3]

There is no evidence in the record that the Village acted for the sole purpose of causing harm to the plaintiffs. As previously discussed, the Village was motivated, at least in part by economic self interest and approved the tower on the Village's property in order to increase the Village's revenues and lower taxes. Accordingly, the Village defendants are entitled to summary judgment dismissing the third cause of action for private nuisance.

Denial of Equal Protection

The plaintiffs contend the Village defendants violated 42 USC § 1983 by treating Omnipoint's application differently than the Suffolk Towers application. Specifically, the plaintiffs contend that the Village imposed more onerous requirements on Omnipoint than on Suffolk Towers and delayed Omnipoint's application so that it could approve the Suffolk Towers application on the Village's property.

A municipality is a "person" subject to suit under 42 USC § 1983 (Bower Assoc. v Town of Pleasant Valley, 304 AD2d 259, 262, affd 2 NY3d 617). With respect to land use, 42 USC § 1983 protects a landowner's rights to (1) equal protection of the laws guaranteed by the Fourteenth Amendment, (2) just compensation for the taking of property guaranteed by the Fifth Amendment, and (3) due process of law guaranteed by both the Fifth and Fourteenth Amendments (Id.). A violation of equal protection arises if a person was selectively treated compared with others similarly situated and such selective treatment was based on impermissible considerations such as race, religion, an intent to inhibit or punish the exercise of constitutional rights, or a malicious or bad faith intent to injure a person (Bower Assoc. v Town of Pleasant Valley, 2 NY3d at 631).

The plaintiffs contend that the Village was acting in bad faith. As previously discussed, the Village was not motivated by a bad faith intent to injure the plaintiffs, but by a desire to increase the Village's revenues and lower taxes. The plaintiffs do not contend, nor is there any evidence int the record, that the Village's actions were based on any other impermissible considerations. Accordingly, the Village defendants are entitled to summary judgment dismissing [*8]the fourth cause of action for denial of equal protection.

Prima Facie Tort

The requisite elements of a cause of action for prima facie tort are (1) the intentional infliction of harm, (2) resulting in special damages, (3) without excuse or justification, (4) by an act or series of acts that are otherwise legal (Del Vecchio v Nelson, 300 AD2d 277, 278). There is no recovery in prima facie tort unless malevolence is the sole motive for the defendant's otherwise lawful act. "Disinterested malevolence" means the genesis that makes a lawful act unlawful must be a malicious one, unmixed with any other motive, and exclusively directed to the injury and damage of another (Burns Jackson Miller Summit & Spitzer v Jackson, Lewis, Schnitzler & Krupman, 59 NY2d 314, 333).

As previously discussed, the Village was motivated, at least in part, by economic self interest and approved the tower on the Village's property in order to increase the Village's revenues and lower taxes. Thus, the plaintiffs cannot establish that disinterested malevolence was the sole motive for the Village's actions. Accordingly, the Village defendants are entitled to summary judgment dismissing the fifth cause of action for prima facie tort.

Actual and Constructive Fraud

A cause of action sounding in actual fraud must state that the defendant knowingly misrepresented or concealed a material fact for the purpose of inducing another party to rely upon it and that the other party justifiably relied upon such misrepresentation or concealment to his or her own detriment (Levin v Kitsis, 82 AD3d 1051, 1054). The elements of a cause of action to recover for constructive fraud are the same except the element of scienter or knowledge of the falsity of the misrepresentation is dropped and replaced by the existence of a fiduciary duty or confidential relationship (Id.; see also, Eden Rock Finance Fund, L.P. v Gerova Financial Group Ltd., 34 Misc 3d 1205[A] at *3). A fiduciary duty generally arises out of a relationship of confidence, trust, or superior knowledge or control, and may exist when one entity is under a duty to act for or to give advice for the benefit of another upon matters within the scope of the relation (see, Broadway National Bank v Barton-Russell Corp., 154 Misc 2d 181, 197 [and cases cited therein]).

There is no evidence in the record that the Village defendants misrepresented or concealed any facts from the plaintiffs. In fact, the plaintiffs do not dispute that the Village defendants never even communicated with them. In the absence of any communications between the Village and the plaintiffs, there could not have been any misrepresentations, reliance, or a relationship of trust or confidence. Moreover, as previously noted, the Village never assumed a duty to act on the plaintiffs' behalf. Accordingly, the defendants are entitled to summary judgment dismissing the sixth and seventh causes of action for actual and constructive fraud, respectively. [*9]

Punitive Damages

Contrary to the plaintiffs' contentions, the State and its political subdivisions are not subject to punitive damages (see, Sharapata v Town of Islip, 56 NY2d 332).

Conclusion

The plaintiffs seek to strike the answer of the Village defendant Darryl B. Samples on the ground that he failed to appear for a deposition. It is well settled that actions should be resolved on their merits whenever possible and that the drastic remedy of striking a pleading is inappropriate absent a clear showing that the failure to comply with discovery demands was willful and contumacious (see, Jenkins v City of New York, 13 AD3d 342 [and cases cited therein]). The plaintiffs have made no such showing. Accordingly, the plaintiffs' motion is denied, and the complaint is dismissed insofar as it is asserted against the Village defendants.

DATED: March 19, 2012

J. S.C. Footnotes

Footnote 1: The last way in which a special relationship may be formed is not applicable to the facts of this case.

Footnote 2: A proceeding pursuant to CPLR article 78 is the proper vehicle by which to compel officials to perform a mandatory duty (see, CPLR 7803[1]). Mandamus may be used to compel the performance of an act required to be done by provision of law when the act sought to be compelled is ministerial, nondiscretionary and nonjudgmental, is premised upon specific statutory authority mandating performance in a specified manner, and when there is an inordinate delay in acting (see, Matter of Bonanno v Town Board of the Town of Babylon, 148 AD2d 532).

Footnote 3: Clause (b), indecent conduct, does not apply to the facts of this case (see, Restatement [Second] of Torts § 829, Comment d, Illustration 2).



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