Chabad of Port Wash., Inc. v Brodsky
Annotate this CaseDecided on October 1, 2012
Supreme Court, Nassau County
Chabad of Port Washington, Inc., Plaintiff,
against
Bert E. Brodsky, BMJ ASSOCIATES, LLC, NORTHEAST EQUITY MANAGEMENT, LLC, BL MANAGEMENT INC., and 87-01 MIDLAND PARKWAY REALTY CORP., Defendants.
601153-12
Attorney for Plaintiff:
WESTERMAN BALL EDERER MILLER & SHARFSTEIN, LLP
1201 RXR Plaza
Uniondale, NY 11556
(516) 622-9200
By: Greg S. Zucker, Esq.
Attorney for Defendant:
LYNN, GARTNER, DUNNE & COVELLO, LLP
330 Old Country Road, Suite 103
Mineola, NY 11501
(516) 742-6200
By: Robert P. Lynn, Esq.
STEvEN LATZMAN, P.C.
276 Fifth Avenue, Suite 402
New York, NY 10001
(212) 532-3368
By: Stephen Latzman, Esq.
Vito M. DeStefano, J.
The following papers and the attachments and exhibits thereto have been read on this motion:
Notice of Motion1
Affirmation in Opposition2
Letter correspondence and e-mail of counsel
dated September 28, 20123
Background
The motion by the attorneys for the Plaintiff, inter alia, for an order directing "defendants Bert E. Brodsky, BMJ Associates, LLC, BL Management Inc. and 87-01 Midland Parkway Realty Corp. to issue to Plaintiff the original propriety leases for Units 3A, 2C, 3C, 4D, 5E, 2F, 6F and 7F within the cooperative known as the Midland Gardens at Jamaica Estates at 87-01 Midland Parkway, Jamaica Estates, New York (the Units) and original stock certificates representing the accompanying shares ( the Shares')", is determined as follows:
Plaintiff is a religious organization. Defendant Bert E. Brodsky (Brodsky) is a member of the Board of Trustees of the Plaintiff, Chabad of Port Washington. Defendant, BMJ Associates, LLC (BMJ) is the sponsor of the cooperative housing complex owned by defendant 87-01 Midland Parkway Realty Corp (the Co-op). Brodsky is a principal of BMJ. BL Management Inc. (BL) is the managing agent for the Co-op.
On or about October 5, 2006 Brodsky and BMJ donated 1,523 shares of the Co-op to the Plaintiff. The shares represented eight apartment units in the Co-op. Plaintiff claims that it never received the original share certificates reflecting its ownership to the shares in the Co-op or originals of the proprietary leases for the Units. Plaintiff also alleges that the Units have been rented but that the income therefrom has not been received by it or accounted for.
On or about March 25, 2009, Plaintiff obtained three loans from TD Bank, N.A. (T.D. Bank): (1) a building loan in the principal amount of $4,488,125.15 (the Building Loan); (2) a project loan in the principal amount of $1,011,874.85 (the Project Loan); and (3) a revolving line of credit in the amount of $100,000. The Building Loan and the Project Loan were both secured by mortgages on Plaintiff's principal place of business, 80 Shore Road, Port Washington, New York, 11050.
On August 14, 2009, TD Bank issued a Notice of Default declaring that Plaintiff was in default on the Loans. TD Bank issued three other Notices of Default concerning the Building Loan and Project Loan, dated September 30, 2009, January 21, 2010 and May 10, 2010. On or about September 9, 2010, TD Bank commenced a foreclosure action against Plaintiff seeking to foreclose on the mortgages encumbering 80 Shore Road, Port Washington, New York (the Foreclosure Action). In its verified complaint in the Foreclosure Action, TD Bank alleged that [*2]the Plaintiff owed $1,899,024.84 as of September 2, 2010, under the Building Loan and Project Loan. As a result of the foreclosure action, the Plaintiff asserts that it needs to marshal sufficient assets and funds, including the subject Units, to allow it to settle the Foreclosure Action and save its buildings. In order to sell the Units, Plaintiff requires the Stock Certificates and proprietary leases.
According to the Plaintiff, for the past nine months, it has repeatedly demanded that Defendants provide it with the original share certificates and proprietary leases associated with the subject shares and Units, but Defendants have refused to provide them. It is alleged Defendants originally said that they could not find these original share certificates or proprietary leases. Plaintiff asserts that Defendants agreed to cooperate with Plaintiff's efforts to have the Co-op issue replacement share certificates and proprietary leases. In connection with the issuance of any replacement share certificates or property leases, Plaintiff asserts that it would submit a lost certificate affidavit and pay the reasonable costs the Co-op incurred to issue such replacement certificates or proprietary leases.
Defendant BL Management, the managing agent for the Co-op, indicated that it could issue the replacement share certificates and proprietary leases upon receipt of an appropriate letter from BMJ. Plaintiff also alleges Defendant BMJ agreed to cooperate with the requirements of the Co-op and BL Management. After the Plaintiff prepared a letter for BMJ's signature, however, BMJ refused to sign. The Plaintiff then brought the instant action and motion.
The complaint contains four causes of action. The first cause of action demands that the Defendants give the Plaintiff the certificates it claims to have never received, but which it says it needs in order to liquidate its holdings and satisfy its obligations to TD Bank. The second cause of action seeks the same relief based on a conversion theory and award of incidental and punitive damages. The third cause of action seeks copies of the books and records concerning the subject co-op units and an order restricting Defendants from "taking any further actions on behalf of Plaintiff" and directing them to inform designated people that they have no authority to act on Plaintiff's behalf. The fourth cause of action seeks damages based on Defendants' withholding of rental income from the subject co-op units (again on a conversion theory).
The Court's Determination
In order to obtain relief pursuant to CPLR 6301, a movant must clearly demonstrate (1) a likelihood of success on the merits, (2) irreparable injury absent granting of the preliminary injunction, and (3) a balancing of the equities in the movant's favor (Aetna Ins. Co. v Capasso, 75 NY2d 860; Doe v Axelrod, 73 NY2d 748; Ruiz v Meloney, 26 AD3d 485; Stockley v Gorelik, 24 AD3d 535; Matos v City of New York, 21 AD3d 936). The purpose of a preliminary injunction is to maintain the status quo and prevent the dissipation of property that could render a judgment ineffectual (Ruiz v Meloney, supra; Coinmach Corp. v Alley Pond Owners Corp., 25 AD3d 642; Weinreb Management, LLC v KBD Management, Inc., 22 AD3d 571). The decision to grant or [*3]deny a preliminary injunction rests in the sound discretion of the Supreme Court (Doe v Axelrod, supra, at 750; Ruiz v Meloney, supra; Weinreb Management, LLC v KBD Management, supra). "It is well settled that absent extraordinary circumstances, a preliminary injunction will not issue where to do so would grant the movant the ultimate relief to which he or she would be entitled in a final judgment" (SHS Baisley, LLC v Res Land, Inc., 18 AD3d 727; St. Paul Fire and Mar. Ins. Co. v York Claims Serv., 308 AD2d 347, 348-349; MacIntyre v Metropolitan Life Ins. Co., 221 AD2d 602).
In opposition to the motion, the Defendants correctly argue that while the Plaintiff styled branch "a" of its motion as one for "injunctive relief," it is, in effect, a motion for partial summary judgment. As such, the branch of the motion seeking this dispositive relief—made in advance of service of the answer, is premature (see CPLR 3212; St. Paul Fire and Marine Ins. Co. v York Claims Service, 308 AD2d 347 [1st Dept 2003] [court improperly granted motion for summary judgment prior to service of pleadings which had been denominated as one seeking preliminary injunction]; Valentine Transit, Inc. v Kernizian, 191 AD2d 159 [1st Dept 1993]). Notwithstanding, during the pendency of this motion, the parties, after conference with the court, settled the first cause of action, by agreeing to facilitate the issuance of new stock certificates and proprietary leases. Accordingly, branch "a" of the motion is denied as academic.
Branch "b" of the motion is, likewise, denied as academic in light of the aforementioned settlement.
Branch "c"(i) of the motion is denied; the parties are hereby ordered to appear in Part 15 for a preliminary conference on Tuesday, October 16, 2012 at 9:30 a.m. at which disclosure deadlines shall be imposed and disclosure disputes, if any, shall be resolved.
Branches "c" (ii) & (iii) of the motion are denied, the papers failing to establish entitlement to such relief.
Branch "d" of the motion is denied.
This constitutes the decision and order of the court
DATE: October 1, 2012
___________________________________
Hon. Vito M. DeStefano, J.S.C.
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