Lelekakis v Kamamis

[*1] Lelekakis v Kamamis 2009 NY Slip Op 52541(U) [25 Misc 3d 1241(A)] Decided on December 14, 2009 Supreme Court, Queens County Markey, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 December 14, 2009
Supreme Court, Queens County

Ilias Lelekakis, Plaintiff,

against

Stanley Kamamis, et al., Defendant.



28566/2001



For the Plaintiff: Thomas Torto, Esq., by Jason Levine, Esq., 419 Park Avenue South, New York, NY 10016

For the Defendants: Michael W. Holland, Esq., 421 Willis Ave., Williston Park, NY 11596

Charles J. Markey, J.

Plaintiff Ilias LELEKAKIS previously moved by order to show cause dated May 7, 2007, seeking, among other things, leave to reargue so much of the order dated January 16, 2007 as denied his motion to direct the clerk to release all moneys on deposit with the court to the credit of this action, and upon reargument, to direct the clerk to turn over the moneys deposited to the credit of this action to him, together with interest, after first deducting therefrom the fees and commissions allowed by law.

Defendants Stanley and Olga KAMAMIS cross-moved for an award of damages against plaintiff pursuant to CPLR 6315 allegedly sustained by them by reason of an improperly issued preliminary injunction in favor of plaintiff, and to direct the clerk to turn over to defendants the funds posted as security pursuant to CPLR 2606 and 2607.

Meanwhile, prior to a determination of the motion and cross motion, the Appellate Division, Second Department, ordered the matter remitted for a trial to determine the amount of use and occupancy owed by plaintiff to defendants, and for the entry of an amended judgment thereafter, to be calculated by deducting the sum awarded to defendants for use and occupancy from the principal sum awarded to plaintiff (Lelekakis v Kamamis, 41 AD3d 662 [2007]). The nonjury trial on the issue of the amount of use and occupancy owed to defendants was held on February 7, 2008. Simultaneous with the nonjury trial on the issue of the amount of use and occupancy, the Court conducted a hearing on the issue of whether defendants were entitled to damages sustained by them by reason of the preliminary injunction, and if so, the amount of the damages, or whether plaintiff was entitled to discharge of his cash undertakings.

By memorandum decision dated December 11, 2008, the court, among other things, awarded the amount of $442,651.62, as the total sum, as and for use and occupancy, and determined that such sum must be deducted from the principal amount of $303,000.00 which was awarded to plaintiff (i.e., as purchase money paid) (see Lelekakis v Kamamis, 41 AD3d 662, 665 [2007]). In addition, the court determined that since the amount of the use and occupancy damages was greater than the purchase money paid, defendants were entitled to recover the amount of $139,651.62, plus prejudgment interest, in damages, and determined that the interest should be computed from March 1, 1998, as a single reasonable intermediate date. [*2]

The Court also determined that defendants were entitled to damages incurred by reason of the improperly issued preliminary injunction, and that such damages were equal to the reasonable rents and profits for the period August 16, 2005 through September 2006. The Court found that the rents and profits for that period equaled the sum of $43,998.39, and denied any award of interest on such amount. The Court further found that defendants had failed to prove they suffered any preliminary injunction damages arising from alleged waste committed by plaintiff upon the property.

By resulting order and judgment (one paper) dated April 28, 2009, the cross motion by defendants was granted to the extent of awarding defendants damages pursuant to CPLR 6315 against plaintiff for the period from August 16, 2005 until September 21, 2006, in the amount of $43,998.39, without interest. The April 28, 2009 order and judgment also granted the branch of the motion by plaintiff for leave to reargue the order dated January 16, 2007 and upon reargument, directed the clerk, upon service of a copy of the order and judgment with notice of entry, after first deducting the fees and commission allowed by law, to pay to defendants the sum of $43,998.39 without interest out of the moneys on deposit, and to pay the remainder on deposit with any accrued interest thereon to plaintiff. The April 28, 2009 order and judgment further directed the Clerk, upon service of a copy of the order and judgment with notice of entry and payment of proper fees, if any, to mark the (prior) judgment entered on August 15, 2005 in favor of plaintiff in the sum of $309,593.71 against defendant Stanley Kamamis as having been satisfied. The April 28, 2009 order and judgment also ordered and adjudged that defendants recover damages against plaintiff Lelekakis in the amount of $133,057.91, plus interest thereon from March 1, 1998, in the amount of $133,794.29, for a total amount of $266,852.20, and that defendants "shall have execution therefor."

Defendants move for leave to reargue the April 28, 2009 order and judgment, and upon reargument, to modify the judgment so to award them a money judgment in the amount of $166,750.00, together with interest thereon from March 18, 2002, constituting damages resulting from the issuance of the preliminary injunction during the period from March 18, 2002 through September 21, 2006, and to direct the clerk to pay defendants such money judgment out of the moneys on deposit to the credit of this action, after first deducting therefrom the fees and commissions to which the clerk is entitled by law, if any, and to award defendants a further money judgment in the amount of $10,372.97 together with interest thereon from March 18, 1998 as and for use and occupancy damages. Plaintiff opposes the motion.

On a motion for leave to reargue, the movant must demonstrate matters of fact or law allegedly overlooked or misapprehended by the court in determining the prior motion (CPLR 2221[d][2]).

Defendants contend that the Court erred when ascertaining the amount of preliminary injunction damages, insofar as it only considered damages sustained by them during the period from August 16, 2005 through September 21, 2006, rather than for the entire period from March 18, 2002 through September 21, 2006. The Appellate Division, Second Department, however, determined that defendants were entitled to use and occupancy for the period in which plaintiff occupied the premises, beginning September 27, 1990, up to and including August 15, 2005 (Lelekakis v Kamamis, 41 AD3d 662 [2007]), and such determination binds this court. Clearly, defendants are not entitled to both use and occupancy for the period March 18, 2002 through August 15, 2005, and rent and profits as an element of preliminary injunction damages for the same period.

Defendants also assert that the court erred in refusing to consider interest lost as a result of [*3]the injunction as an element of the damages they suffered. Although lost interest on funds which were restrained has been held to be a proper element of damages covered by an undertaking in connection with a preliminary injunction (see Shu Yiu Louie v David & Chiu Place Restaurant, Inc., 261 AD2d 150, 152 [1999]), no funds were restrained herein, and defendants have failed to demonstrate that lost interest on rents and profits should be considered as part of the damages suffered by them in connection with the preliminary injunction herein.

There is no common-law or statutory cause of action for damages due to an improperly procured preliminary injunction (Shu Yiu Louie v David & Chiu Place Restaurant, Inc., 261 AD2d 150, 152 [1999]). Rather, the basis for damages is the undertaking itself which is a contract between the parties "that the plaintiff, if it is finally determined that he was not entitled to an injunction, will pay to the defendant all damages and costs which may be sustained by reason of the injunction (CPLR 6312, subd [b])" (Honeywell, Inc. v Technical Bldg. Servs., 103 AD2d 433, 434 [1984]). Notably, the Appellate Division's decision and order dated May 2, 2002, indicated that by filing an undertaking, plaintiff was agreeing to the terms that he would pay to defendants all damages and costs which might be awarded to them "in action in which the injunction was granted," including the reasonable rent and profits of, and any wastes committed upon the real property (Lelekakis v Kamamis, decision and order of the Appellate Division, Second Department dated May 2, 2002). The decision and order makes no mention of interest.

The April 28, 2009 order and judgment, however, must be modified, insofar as it directed the clerk to pay out the damages suffered by defendants by virtue of the improperly issued preliminary injunction from the undertakings. Under CPLR 6315, the party wrongfully enjoined may seek summary relief by motion for an assessment of damages in the action in which the injunction was issued. However, once the summary relief is granted, such party must commence a separate action to procure a judgment (see CPLR 6315; Republic of Croatia v Trustee of Marquess of Northampton 1987 Settlement, NYLJ, Mar. 8, 1996, at 26, col 1 [Sup Ct, New York County, Shainswit, J.], affd 232 AD2d 216 [1st Dept 1996]; Matter of Sweets v Behrens, 118 Misc 2d 1062 [1983]; see also Kelly v Myrick, 205 App Div 637 [applying predecessor statute to CPLR 6315]; cf. Apfelberg v East 56th Plaza, Inc., 112 Misc 2d 680 [1982]). In such separate action, that party is relieved of the burden of proving damages by virtue of any order issued in the action wherein the preliminary injunction was granted (see Matter of Sweets v Behrens, 118 Misc 2d 1062, 1064 [1983], supra; cf. CPLR 6312).

Thus, that branch of the motion by defendants for leave to reargue the order and judgment dated April 28, 2009 is granted and, upon reargument, the order and judgment is modified only to the extent of:

1) deleting the second, third,- and fourth ordering paragraphs (commencing on page 2, line 12 of the order and judgment and continuing on page 3, to line 6, inclusive), and

2) substituting the following ordering paragraphs:

ORDERED, that branch of the cross motion by defendants for an award of damages pursuant to CPLR 6315 is granted only to the extent of fixing the damages incurred by defendants resulting from the improperly granted preliminary injunction in this action in the amount of $43,998.39, without interest, and it is further,

ORDERED, that branch of the cross motion by defendants to direct the clerk of the court [*4]to turn over to defendants the moneys on deposit posted as the undertakings is denied without prejudice to commencement of a separate action by defendants against plaintiff to procure a judgment for the amount of $43,998.39, without interest and recover such amount against the undertakings, and it is further,

ORDERED, that branch of plaintiff's motion for leave to reargue the order dated January 16, 2007 is granted, and it is further,

ORDERED, upon reargument of the order dated January 16, 2007, that branch of the motion by plaintiff to direct the clerk of the court to turn over to plaintiff the moneys deposited to the credit of this action together with accrued interest, after first deducting therefrom the fees and commission, allowed by law to the clerk of the court, if any, is granted only to the extent of directing the clerk of the court, upon service of a copy of the order and modified judgment with notice of entry, to pay over to defendants the balance of the moneys on deposit with the court after first deducting 1) the fees and commissions allowed by law to the clerk of the court, if any, and 2) the amount of $43,998.39.

Settle order and modified judgment.



J.S.C.

Appearances:

For the Plaintiff: Thomas Torto, Esq., by Jason Levine, Esq., 419 Park Avenue South, New York, NY 10016

For the Defendants: Michael W. Holland, Esq., 421 Willis Ave., Williston Park, NY 11596