Eastwood Inv. V, LLC v Morrisania Assoc.

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Eastwood Inv. V, LLC v Morrisania Assoc. 2013 NY Slip Op 31921(U) August 12, 2013 Sup Ct, New York County Docket Number: 652864/12 Judge: Barbara R. Kapnick 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. [*FILED: NEW YORK COUNTY CLERK 08/15/2013 1] £~1------------------------~ NYSCEF DOC. NO. 20 , INDEX NO. 652864/2012 RECEIVED NYSCEF: 08/15/2013 SUPREME COURT OF THE STATE OF NEW YORK NEW YORK COUNTY PRESENT: BARBARA R. KAPNICK ¢. ' C' ,... Justice ( Index Number: 652864/2012 EASTWOOD INVESTORS V, LLC "'I INDEX NO. _ _ _ __ I VS. MOTION DATE _ _ __ I .J MORRISANIA ASSOCIATES, SEQUENCE NUMBER: 001 DISMISS ACTION MonON SEQ. NO. _ __ The following papers, numbered 1 to _ _ , were read on this motion to/for _ _ _ _ _ _ _ _ _ _ _ _ __ Notice of Motion/Order to Show Cause - Affidavits Answering Affidavits - I No(s).,_ _ _ _ __ I No(s). _ _ _ _ __ I No(s). _ _ _ _ __ Exhibits Exhibits _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ Replying Affidavits _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ Upon the foregoing papers, it is ordered that this motion is MOTION 18 DECJD2D IN ACCORDANCE WITH ACCOM1tANYING MEMORAF\'i)Ug DECISION w u t= en .., ::J o l- e w a:: a:: w u. w a:: .. >-..J~ ..J ::J Z 0 u. en I- c( U w a:: W z a:: en ~ W ~ - W en (!) 0 ..J ..J c( 0 Z W :J: u u. o It= a:: o 0 :E u. Dated: ---"f5~'I1-l; '- '2. .~h'.:. . l/3 __ 1. CHECK ONE: ..................................................................... 2. CHECK AS APPROPRIATE: ........................... MOTION IS: 3. CHECK IF APPROPRIATE: ................................................ ---I--=l-ww.-.l+-"":::::==-' J.S.C. 0 0 0 .KAPNICK CASE DISPOSED GRANTED 0 SETILE ORDER DDO NOT POST DENIED \¢ NON-FIN~~.If!0SITION GRANTED IN PART" 0 OTHER o SUBMIT ORDER o FIDUCI ,~RY APPOINTMENT 0 REFERENCE, -'"" .' [* 2] SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: IA PART 39 --------------------------------------x EASTWOOD INVESTORS V, LLC, DECISION/ORDER Index No. 652864/12 Motion Seq. No. 001 Plaintiff, -againstMORRISANIA ASSOCIATES, a New York Limited Partnership, TWO TREES, INC., and TWO TREES MANAGEMENT CO., LLC, Defendants. --------------------------------------x BARBARA R. KAPNICK, J.: This motion by defendants to dismiss the Complaint pursuant to CPLR 3211 (a) (1), (2), (3) and (7) is granted, in accordance with the decision dictated on the record on May 23, 2013, to the extent of dismissing the first and fourth causes of action and allowing plaintiff to replead the remainder of the Complaint, except for the second cause of action, in its capacity as attorney-in-fact. With respect to the second cause of action, the plaintiff seeks the following declaratory relief! "a judgment declaring, in the alternative, and at a minimum, that Eastwood is entitled to all the economic rights and benefits in the Limited Partnership in accordance with its limited partnership interest," and an order compelling Two Trees/Two Trees LLC to, among other things, (i) reflect and record Eastwood's economic interest on the books and records of the Partnership; (ii) issue Schedule K-1's to Eastwood prospectively; (iii) correct and reissue the Schedule K-1's 1 [* 3] issued in 2010 (for tax year 2009), in 2011 (for tax year 2010), and in 2012 (for tax year 2011); and (iv) take any and all other steps necessary to recognize Eastwood's rights as assignee of the economic rights and benefits of 74.28% of the limited partnership interests in Morrisania Associates. (Compl. be ~~ 47-48.) dismissed in Defendants argue that this cause of action must light of the express language of the Limited Partnership Agreement, which provides in relevant part as follows: Section 7.05. Transfer of Partnership Interest by Limited Partner; Substi tuted Limited Partner. The Partnership Interest of a Limited Partner may not be transferred or assigned in whole or in part except with the prior written consent of the General Partner. * * * Section 7.09. Attempted Transfer in Violation of this Article Void. Any attempted assignment or transfer In violation of the provisions of this Article VII shall be void and ineffectual and shall not bind the Partnership. Notwithstanding this language, plaintiff argues that its assignment, even if not valid for the purposes of transferring full substi tuted limi ted partnership rights, must be purpose of transferring economic benefit rights, Partnership Law ("NYPL") § 108. 1 This argument, valid for the pursuant to NY however, fails, 1 NYPL 108(3) provides that "[a]n assignee, who does not become a substituted limited partner, . is only entitled to receive the share of the profits or other compensation by way of income, or the return of his contribution, to which his assignor would otherwise be entitled." 2 [* 4] because, as stated by the Court of Appeals, NYPL provisions are default provisions that only "come into play in the absence of an Ederer v. Gursky, agreement." Fish & 9 NY3d 514, Neave, 8 NY3d 523, 529 (2007) implied as part of the different contract that which agreement so as to make a the parties AD2d 988 (lst Dep't 1984) intended nor in fact, override the agreement which the parties, also Lanier v. Bowdoin, 282 NY 32 (2007); Bailey v. (provisions of NYPL "cannot be [partnership] from 526 made."); see (1939); Raymond v. Brimberg, 99 Since the Limited Partnership Agreement here specifically provides in Section 7.05 that the interest of a Limi ted Partner may without consent assignment of including a of any right not be trans ferred the General part to of the Partner, the limited in "whole there or part" can be no valid partnership economic benefi ts. in interests, Accordingly, the second cause of action is dismissed, without leave to replead. Plaintiff has 30 days to replead the Complaint in accordance with this decision and the decision dictated on the record on May 23, 2012. Defendants shall have 30 days to file and serve their Answers. Counsel for all parties conference in IA Part 39, shall appear 60 Centre Street, 13, 2013 at 10:00 a.m. 3 for a preliminary Room 208 on November [* 5] This constitutes the decision and order of this Court. Dated: , 2013 ~ R. KAPNICK J.S.C. 4

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