Aniqa Halal Live Poultry Corp. v Montague-Lee Ltd. Partnership

[*1] Aniqa Halal Live Poultry Corp. v Montague-Lee Ltd. Partnership 2011 NY Slip Op 52265(U) Decided on December 21, 2011 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 21, 2011
Supreme Court, Queens County

Aniqa Halal Live Poultry Corp.

against

Montague-Lee Limited Partnership



22339/2011



For the Plaintiff: Arthur Morrison, Esq., 11 Skyline Drive, Hawthorne, New York 10532

For the Defendant: Harrison & Rothbard, by Alan T. Rothbard, Esq., 105-15 Metropolitan Ave., Forest Hills, New York 11375

Charles J. Markey, J.

The following papers numbered 1 to 23 read on this motion by plaintiff Aniqa Halal Live Poultry Corp. for an order granting a preliminary injunction enjoining defendant Montague Limited Partnership from terminating the plaintiff's tenancy in the commercial premises known as 96-18 43rd Avenue, Corona, New York. Defendant Montague-Lee Limited Partnership cross moves in opposition and in the event that plaintiff's motion is granted, seeks an order setting the matter down for an expedited discovery schedule, and fixing the amount of the undertaking.

Papers Numbered

Order to Show Cause, Affirmations and Affidavits, Summons-and Complaint,

and Exhibits (A-C)................................................................................................1-5

Notice of Cross MotionAffidavit-Exhibits (A-P).....................................................6-9

Opposing Affirmation-Affidavits-Exhibit (A-B)......................................................10-17

Reply Affirmation-Exhibits (A-B)............................................................................18-20 [*2]

Sur Reply Affirmation-Exhibit (A)...........................................................................21-22

Sur Sur Reply Affirmation..............................................................................................23

On April 12, 1996, Aniqa Halal Live Poultry Corp. ("Aniqa"), as a tenant, entered into a written lease agreement with 96-18 43rd Avenue Corp., as owner, whereby it leased a portion of the first floor of the premises known as 96-18 43rd Avenue, Corona, in Queens County, New York, for a period of 15 years commencing April 15, 1996 through March 31, 2011.

Aniqa operates a Halal live poultry market, slaughter house, and meat market, at the subject premises. Defendant Montague-Lee Limited Partnership ("Montague-Lee") purchased the subject building in June 2006. Aniqa remained in occupancy after March 31, 2011 and the Montague-Lee accepted monthly payments in the same amounts previously paid under said lease. Montague-Lee served a thirty-day notice of termination on Aniqa, dated August 22, 2011, whereby it elected to terminate the month-to-month tenancy, as of September 30, 2011.

Plaintiff Aniqa commenced this action against Montague-Lee on September 27, 2011, and seeks specific performance of an oral agreement to extend a commercial lease for a period of ten years.

The complaint alleges that more than a year ago UiKon [Ui Kun] Lee, a general partner of Montague-Lee, orally agreed to extend the subject lease for another ten-year term at "market rent", with increases using the same percentage formula set forth in the written lease. It is alleged that the roof of the subject real property required extensive repairs more than a year ago, and that the Mr. Lee orally agreed to extend the lease, "if the plaintiff tenant, as consideration for the ten (10) year oral lease extension, would make improvements to the exterior of the building premises, and immediately expend the sum of $165,000 to repair the roof."

The complaint alleges that immediately after entering into said oral agreement plaintiff fully performed and "did in fact make all agreed upon improvements upon the premises and paid the $165,000 in connection with the complete roof repair and improvement for upkeep of the defendant's property, including sums above $165,000 for painting portions of the building plus improvement of the heating plant in the premises, and its electrical system including wiring and electrical fixtures." It is alleged that plaintiff expended a total of $250,000 in consideration for obtaining the renewal lease.

Plaintiff alleges that the oral extension agreement was "reiterated by plaintiff-tenant [*3]on many occasions during the 14th and 15th year of the term" of the written lease. The complaint further alleges that Ui Kun Lee had knowledge of these improvements to the building, and stated that "he would execute and deliver a lease for the premises for another ten(10) year term at market rent," with percentage increases based upon the formula used in the written lease. Plaintiff alleges that although it performed all the conditions of the agreement, defendant failed and neglected to execute and deliver said lease, and that it served a thirty day notice to terminate the tenancy. Finally, the complaint alleges that the New York City School Construction Authority ("SCA") may be considering the subject store premises as a site for a school.

Plaintiff, in its order to show cause, seeks a preliminary injunction enjoining the defendant, its agents, servants, and employees from terminating its tenancy. A temporary restraining order was granted on September 27, 2011, with an original return date of October 6, 2011. Counsel for the parties appeared in this part, at which time defendant's counsel stated on the record that he did not receive timely and proper notice of the application for the order to show cause, as counsel for plaintiff faxed the required notice to Aniqa's fax number, rather than that of the defendant or its counsel. The Court, although aware of this defect, permitted plaintiff to proceed on this motion for an injunction.

A party moving for a preliminary injunction must demonstrate by clear and convincing evidence (1) a likelihood of ultimate success on the merits, (2) irreparable injury absent the granting of the preliminary injunction, and (3) that a balancing of equities favors the movant's position (W.T. Grant Co. v Srogi, 52 NY2d 496, 517 [1981]; Radiology Assoc. of Poughkeepsie, PLLC v Drocea, 87 AD3d 1121 [2nd Dept. 2011]; EdCia Corp. v McCormack, 44 AD3d 991, 993 [2nd Dept. 2007]). The movant must show that the irreparable harm is "imminent, not remote or speculative" (Family-Friendly Media, Inc. v Recorder Television Network, 74 AD3d 738, 739 [2nd Dept. 2010]; Golden v Steam Heat, Inc., 216 AD2d 440, 441 [2nd Dept. 1995]).

"Economic loss, which is compensable by money damages, does not constitute irreparable harm" (EdCia Corp. v McCormack, 44 AD3d at 994, supra; accord, Rowland v Dushin, 82 AD3d 738 [2nd Dept. 2011]; Trump on the Ocean, LLC v Ash, 81 AD3d 713 [2nd Dept. 2011]; see also, Family-Friendly Media, Inc., 74 AD3d 738, supra). The decision to grant or deny a preliminary injunction lies within the sound discretion of the Supreme Court (see, Dover Gourmet Corp. v Nassau Health Care Corp., ___ AD3d ___, 2011 WL 5865854, 2011 NY Slip Op 0855 [2nd Dept. 2011]; Cooper v Board of White Sands Condominium, _____ AD3d ____, 931 NYS2d 696 [2nd Dept. 2011]; Town of Southampton v County of Suffolk, 88 AD3d 988 [2nd Dept. 2011]; Glorious Temple Church of God in Christ v Dean Holding Corp., 35 AD3d 806, 807 [2nd Dept. 2006]). [*4]

Plaintiff, in support of the within motion submits an affidavit from Abdul Wahid, who states that he is the President of Aniqa. With respect to the alleged oral agreement to extend the lease, he states that over a year ago, the landlord orally agreed extend the lease for ten years, at market rent, with increases using the same percentage formula set forth in the written agreement, and that plaintiff expended $250,000 for improvements to the property in reliance on said oral agreement. He states that he has been informed that the SCA is considering the store's premises as a school site, but that "under the present economy we cannot verify that any funds as [sic] are available for construction."

Wahid states that plaintiff seeks to remain in occupancy and operate its business, and asserts that absent an injunction it will sustain irreparable harm, as its food market provides a unique service that cannot be replaced in Corona. Plaintiff has submitted a copy of the 1996 lease, a copy of the thirty day notice to terminate, and copy of a petition addressed to the "Chancellor New York City Board of Education," requesting that a proposed new school building be built on another site, and signed by various customers of the plaintiff.

In support of its cross motion, and in opposition to the plaintiff's motion for a preliminary injunction, defendant Montague-Lee asserts that it did not enter into an oral agreement to extend the lease term for ten years in exchange for the alleged repair to its roof. Defendant Montague-Lee also maintains that Wahid, in his supporting affidavit, failed to state what repairs were to be performed and when they were performed, failed to state who performed the repairs; and did not submit any invoices, contracts or paid bills. Defendant Montague-Lee also asserts that Wahid applied for a certificate of occupancy in 1996 which resulted in the issuance of a temporary certificate of occupancy in 1997 that has since expired, and that Wahid then applied for a modification of the certificate of occupancy which resulted in numerous violations against the premises. Defendant Montague-Lee has submitted documentary evidence with respect to the certificates of occupancy and notices of violation.

Defendant Montague-Lee submits an affidavit from Young Lee, a limited partner, and an attorney. Lee states that his father, Ui Kun Lee, is the general partner of Montague-Lee, Montague-Lee entered into a contract with the SCA dated March 16, 2011 for the sale of the entire property for the sum of $11,200,000.00, a down payment of $1,200,000.00 has been deposited in an escrow account maintained by the purchaser's title insurance company, all necessary approvals for the contract of sale were obtained by the end of July or beginning of August, and all funds necessary to proceed to closing and to purchase the property is now available. Lee states that the sale of the property was negotiated and conducted under the "threat" of condemnation, and, in the event that the sale does not occur, the SCA will proceed to acquire the property by condemnation, and that it would be inequitable to permit plaintiff, a holdover tenant, to gain a monetary advantage in the event of a condemnation proceeding. Montague-Lee, therefore, argues that a balancing of equities tips in the [*5]defendant's favor.

Lee further states that Wahid received a letter from a law firm dated April 4, 2011, advising it of a public notice from the SCA with respect to the subject property and offering to represent it in any eminent domain claim. He states that when Wahid brought this to his attention, he informed Wahid that Montague-Lee had contracted to sell the property to SCA. Lee asserts that Montague-Lee never made any oral promise to extend or renew the lease, despite numerous requests by Aniqa for an extension or renewal of the lease. Lee states that no such offer would have been made, as the defendant had been interested in selling the property since 2008, and as Aniqa had created and had failed to cure a problem pertaining to the certificate of occupancy. Lee has submitted various documents pertaining to the marketing of the real property, and the certificate of occupancy.

Defendant also submits an affidavit from Yang Jun Paio, an employee of Montague-Lee, which refers to photocopies of photographs of the building's roof. Paio states that he "had this affidavit translated to me into Korean." In the absence of an affidavit from a translator, setting forth the qualifications of the translator, the court must disregard Paio's affidavit (CPLR 2101[b]).

Defendant also submits an affidavit from Gregory P. Shaw, the principal attorney for Contracts, Construction & Real Estate for the Legal Department of the SCA. Shaw states that the contract for the purchase of the subject real property, which includes the premises occupied by plaintiff, has been approved; that the funding is in place, the down payment has been deposited with the purchaser's title insurance company, a title search has been issued, and the SCA could close within a week if the seller was ready to close. Shaw also states that, in the event that the sale does not take place, the Board of Trustees of the SCA has approved a resolution authorizing the SCA to acquire the property under the doctrine of eminent domain, and that the tenants will be out of possession. Shaw includes with his affidavit copies of the documents pertaining to said approvals and authorizations.

Plaintiff, in opposition to the cross motion, submits a new affidavit from Wahid, who states that upon review of his bank and telephone records, he paid Aniqa's monthly rent for the last year of the lease, and made requests to extend the lease for another ten years on a monthly basis from February 1, 2010 to April 2011, and that, during this time period, Lee promised him each month that the lease was being prepared by the company lawyer and that he could remain in occupancy.

Wahid states that, on June 13 and 14, 2010, he inquired as to the two Lees whether he should relocate elsewhere as he had not received a written lease, and was assured that he would get a ten-year lease extension. He asserts that the roof was in poor condition. Wahid [*6]says that, on February 6, 2011, both of the Lees came to his store, at approximately 8:30 A.M., after being informed that three burglars gained access through the roof between 1:00 A.M. and 2:00 A.M., and stole $24,000 from the office.

Wahid states that affidavits are annexed from persons who were then present, and "heard the owners and landlord again make the oral promise, that the owner would extend deponent's poultry store lease for ten (10) more years if I would pay to totally replace the roof and exterior glass which cost $165,000 as I would be occupying the space below the replaced roof for the next ten years." Wahid also states that there is no certificate of occupancy issue.

Plaintiff submits three affidavits from the following non-parties: Bermeo Nelson, a licensed roofing contractor, "doing business at Burmeo [sic] Hermanos Corp.," Iqbal Kabir, the manager of Aniqa; and Juan Carlos Giraldo, a "car driver who frequently responds" to calls from Wahid. These three individuals each state in their affidavits that they, along with Wahid, the Lees, and several police officers, were present at the subject premises on the morning of February 6, 2011, following an overnight burglary in the poultry market.

Nelson and Kabir both state in their respective affidavits that the burglars had cut holes in the roof and gained entry to the market's office, and stole cash. They both state that they heard a conversation between the Lees and Wahid, in which the landlord allegedly stated that they would extend the lease for another ten years if Wahid would fix the roof and exterior glass.Giraldo attests to a negotiation between the landlord and Wahid regarding the payment of the roof repair and the extension of the lease.

Nelson further states in his affidavit that his cost estimate was $165,000 for the roof and exterior glass windows, including labor and materials; that his corporation was hired by Aniqa to fix the roof over his store premises and that "[w]e were paid a total of $165,000 for this roofing work and replacement of the exterior window glass." Plaintiff submits a copy of an "agreement" dated February 6, 2011, on the letterhead of "Burmeo Hermanos Corp."[FN1] The "agreement" states that Bermeo Nelson, "a licensed contractor owning the above firm, am entering an agreement with Mr. Abdul Wahid, the President of Aniqa . . . to repair the roof of his business and fix the exterior window glass with an amount of $165,000. I am committed to finish my contracted job in time." This agreement is executed by Wahid and Nelson.

Plaintiff also submits an affidavit from Michael Cohen, Esq., who represented plaintiff at a meeting at defendant's office on April 12, 2011.Cohen states that Wahid was [*7]present at a lengthy meeting with one of the two Lees, simply described as "Mr. Lee," on that date, and that the purpose of the meeting was to discuss the extension of the lease for a ten-year term.

Defendant, in its reply, asserts that plaintiff's documents and affidavits submitted in opposition to the cross motion constitute an improper reply, as they are not offered in opposition to the cross motion which seeks expedited discovery and the posting of an undertaking in the event that the motion for a preliminary injunction is granted. Defendant further states that a search of the New York City Department of Consumer Affairs website failed to reveal any licensed contractor under the license number provided by Nelson and that a search of the Department of State's website failed to reveal any business entity known as "Burmeo Hermanos Corp." The defendant reiterates its assertions regarding the certificate of occupancy and the resulting violations and submits additional documentary evidence with respect to outstanding violations.

The "sur reply" affirmation submitted by defendant's counsel and the "sur sur reply" affirmation submitted by plaintiff's counsel both needlessly contain allegations and arguments previously raised by the parties.

Plaintiff has failed to demonstrate, by clear and convincing evidence, the likelihood of ultimate success on the merits. Plaintiff seeks to enforce an oral lease for a term longer than one year. This is clearly barred by the statute of frauds (General Obligations Law § 5-703[2]). To the extent that plaintiff's claim is premised on the theory that the parties contracted by exchanging promises that plaintiff would perform certain work in the subject premises, and defendant would enter into a lease for a term longer than one year, this is nothing more than a contract to enter into a lease, which is also subject to the statute of frauds (Farash v Sykes Datatronics, Inc., 59 NY2d 500, 503 [1983]; Geraci v Jenrette, 41 NY2d 660, 664 [1977]).

To the extent that plaintiff seeks enforcement of the oral agreement based upon equitable doctrine of part performance (see, General Obligations Law § 5-703 [4]), plaintiff must demonstrate that it engaged in conduct which was "unequivocally referable" to the purported 10-year lease (Burns v McCormick, 233 NY 230, 234 [1922]). "Unequivocally referable" conduct is conduct which is "inconsistent with any other explanation" (Richardson & Lucas, Inc. v New York Athletic Club of City of NY, 304 AD2d 462, 463 [1st Dept. 2003]; see also, 745 Nostrand Retail Ltd. v 745 Jeffco Corp., 50 AD3d 768 [2nd Dept. 2008]). To the extent that the plaintiff is alleging that part performance, Wahid omitted from his initial affidavit any mention of the alleged repairs to the roof in the sum of $165,000, which the complaint alleges was "immediately" performed in connection with the oral agreement to extend the lease. In addition, Wahid did not state when the claimed [*8]improvements were made, the nature of the improvements, who performed the work, and when the claimed payments were made.

Plaintiff, in opposition to the cross motion, seeks to cure these deficiencies in proof by submitting another affidavit from Wahid, as well as supporting affidavits from non-parties. These affidavits, however, are insufficient to establish the existence of an enforceable oral agreement accompanied by part performance. Cohen attests only to discussions regarding the plaintiff's request to extend or renew its lease, and he does not state that any such agreement was entered into by the parties.

Although the complaint alleges that the oral agreement was entered into more than a year ago, and that repairs to the roof were made "immediately" thereafter, Wahid now claims that the oral agreement was either repeated or entered into on February 6, 2011, and that the roof and exterior windows were repaired for the sum of $165,000, following the February 6, 2011 burglary. The purported repair agreement between plaintiff and Burmeo Hermanos Corp., dated February 6, 2011, is insufficient to establish part performance of an oral agreement, as it does not state when the work was to commence or when it would be completed. Plaintiff has not submitted a fully itemized estimate or billing statement, invoices, bills of sale, or any other reliable proof that the roof and exterior windows were in fact repaired and that payment was made to in the sum of $165,00.00.

The Court further finds that plaintiff has failed to establish the balancing of the equities in its favor. Quite the contrary is true: the balancing of the equities favors the defendant. The plaintiff has not established that its occupancy of the subject building complies with a valid certificate of occupancy, so as to permit it to continue to occupy the subject premises. Defendant Montague-Lee, furthermore, has entered into a contract of sale with the SCA and is entitled to the benefit of its bargain, rather than have the property be acquired by the SCA pursuant to a condemnation proceeding.

The Court notes that the papers filed with the Court, and/or submitted in support of this motion, contain several irregularities. The summons filed with the Court, as well as the copies of the complaint filed with the court and submitted in support of the order to show cause, are not executed, in violation of 22 NYCRR section 130-1.1-a. The statement accompanying the compliant, which appears to be a verification, was executed by Abdul Wahid, who states that he is plaintiff. Wahid, however, is not named as a plaintiff in the summons, and does not state his relationship to the corporate plaintiff in said verification. Counsel for plaintiff failed to affix the index number in this action to his supporting affirmation as required by 22 NYCRR 202.5(a). Finally, the certification filed with the court by plaintiff's counsel is not executed, in violation of 22 NYCRR section 130-1.1-a.

Accordingly, plaintiff's motion for a preliminary injunction is denied, and the defendant's motion for expedited discovery and for an order directing plaintiff to post an undertaking, is denied as moot. [*9]

Plaintiff is directed to file an amended copy of the complaint, which is signed and contains a proper verification, and to affix the index number to the pleadings, and to correct all irregularities noted above, no later than February 23, 2012.

The foregoing constitutes the decision, opinion, and order of the Court.

_______________________________

J.S.C.

Dated: December 21, 2011

Footnotes

Footnote 1: The company was actually incorporated as "Bermeo Hermanos Corporation."