Avdoulos v Douglaston Realty LLC

[*1] Avdoulos v Douglaston Realty LLC 2014 NY Slip Op 50007(U) Decided on January 2, 2014 Supreme Court, Queens County Siegal, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 January 2, 2014
Supreme Court, Queens County

Spyros Avdoulos, Plaintiff,

against

Douglaston Realty LLC, Defendant.



6494/13

Bernice D. Siegal, J.

The following papers numbered 1 to 9 read on this motion for an order (1) vacating and canceling the Notice of Pendency dated March 25, 2013 affecting Block 8166, Lots 20 and 25, under the tax map of Queens County pursuant to Article 65 of the CPLR and relevant case law; (2) dismissing the March 25, 2013, Summons and Complaint filed 4, 2013 to CPLR §3211(a)(1) and 3211(a)(7) with prejudice; (3) directing plaintiff to immediately pay $190,000.00 to the order of defendant's attorney, "James E. Kasdon, Esq., as attorney", to hold in escrow; (4) requiring plaintiff to bond $3,990,000.00 representing the balance then due on the contract of sale; and (5) tolling and extending the time for defendant to serve and file an answer and counterclaims pursuant to CPLR §3211(f).

PAPERS

NUMBERED

Order to Show Cause- Affidavits-Exhibits...........................1 - 4

Affirmation in Opposition....................................................5 - 9

Upon the foregoing papers, it is hereby ordered that the motion is resolved as follows:

Defendant, Douglaston Realty LLC ("Douglaston") moves for an order vacating and canceling the Notice of Pendency dated March 25, 2013 and dismissing the March 25, 2013, Summons and Complaint filed April 4, 2013 pursuant to CPLR §3211(a)(1) and 3211(a)(7) with prejudice. Alternatively, Defendant seeks an Order directing plaintiff to immediately pay [*2]$190,000.00 to the order of defendant's attorney, "James E. Kasdon, Esq., as attorney", to hold in escrow and requiring plaintiff to bond $3,990,000.00 representing the balance then due on the contract of sale.

As more fully set forth below, the Notice of Pendency is vacated but the motion to dismiss is denied and ancillary relief are denied.

Facts

On April 28, 2011, Douglaston entered into a contract of sale with Plaintiff Spyros Avdoulos a/k/a Spiro Avdoulos ("Plaintiff" or "Avdoulos") for the sale of the commercial properties known as 233-02 Northern Blvd, Douglaston NY and 233-20 Northern Blvd, Douglaston NY for $4,200,000.

Pursuant to the terms of the Contract, Plaintiff tendered $20,000 when the contract was signed and in exchange was given a 30 day Due Diligence Period. During that period, Defendant's sole contractual obligation was to permit purchaser access to the subject premises to conduct its due diligence inspections.

At the end of the 30 day period, Plaintiff had the right to either proceed with the transaction by remitting the full contract deposit or terminate the contract. Defendant contends that Plaintiff failed to comply with the terms and on August 24, 2011; Defendant issued a letter terminating the Contract and, approximately a year and a half later, it obtained a new potential buyer. Defendant also contends that Plaintiff , on January 25, 2013, filed his first Notice of Pendency and Summons and Verified complaint to prevent any other sale by Douglaston.

Plaintiff cancelled the Notice of Pendency and discontinued the prior action without prejudice. Plaintiff then filed a new Notice of Pendency and brought the within action under a new Index Number in which Plaintiff seeks specific performance of the contract and damages for breach of contract and raises a new cause of action for a constructive trust.

Discussion

Notice of Pendency

Defendant contends that Plaintiff improperly attempted to avoid the mandatory statutory requirements of CPLR 6512 and 6514(a) by withdrawing the original Notice of Pendency and filing a brand new action. CPLR 6516 (c) provides: "Except as provided in subdivision (a) of this section [relating to mortgage foreclosure actions], a notice of pendency may not be filed in any action in which a previously filed notice of pendency affecting the same property had been cancelled or vacated or had expired or become ineffective." (Guttman v Gutman, 78 AD3d 779 [2nd Dept 2010].) Furthermore, "CPLR 6516 (c) precludes the filing of successive notices of pendency in the same action." (Id. at 781.) "A notice of pendency is an extraordinary privilege' which demands strict compliance' with applicable statutory requirements." (Old World Custom Homes, Inc. v Crane, 33 AD3d 600, 600 [2nd Dept 2006] citing Israelson v Bradley, 308 NY 511 [1955].) It is well settled, that successive Notices of Pendency are not permitted. (Guttman v Gutman, supra [holding that the cancellation of a Notice of Pendency, purportedly to facilitate the terms of a settlement, prevented the filing a new Notice of Pendency with respect to the same property]; Mastronardi v Countywide Constr. Corp., 2 AD3d 416 [2nd Dept 2003][holding the cancellation of the Notice of Pendency for improper service barred the filing of a new Notice of Pendency in a new action]; Weiner v MKVII-Westchester, 292 AD2d 597 [2nd Dept 2002][holding that the addition of two defendants, who were not named in the first action, is a change of form, rather than of substance, and does not [*3]require a different result].) Furthermore, Plaintiff's contention that the Notice of Pendency is valid because it now contains a cause of action for a constructive trust is without merit. (Old World Custom Homes, Inc. v. Crane, 33 AD3d 600 [2nd Dept 2006][holding that the application for a new Notice of Pendency is invalid despite the inclusion of a claim for a constructive trust].)

The court notes that the Appellate Division, Second Department deemed a second Notice of Pendency valid in Deutsch v. Grunwald. However, in Deutsch, there was no"identity of plaintiffs" as the Administrator of an estate, who was not named in the original complaint, brought the second notice of pendency. In addition, the court in Deutsch noted that the plaintiff, in the original complaint, complied with the statutory requirements for filing a notice of pendency. In the within action, there is no indication with respect to whether Plaintiff complied with the statutory requirements.

Motion to Dismiss

Defendant moves to dismiss Plaintiff's Summons and Complaint based on Plaintiff's failure to comply with the terms of the 30 day Due Diligence Period. The Contract of Sale and Rider required that at the end of the 30 day Due Diligence Period, Plaintiff had the right to proceed with the transaction or terminate the contract. Defendant contends that Plaintiff, in bad faith, attempted to renegotiate the contract to lower the purchase price and change the financing terms. On August 24, 2011, Defendant sent a letter terminating the Contract. A year and a half later, when the Defendant found a new buyer, plaintiff filed his first Notice of Pendency. However, Defendant fails to set forth legal grounds for dismissal. In fact, Defendant's affirmation is completely silent on the issue of dismissal. What is even more troubling is that Defendant attempts to dismiss the action based on the fact that the Contract has been terminated, yet within the same motion for dismissal defendant seeks the affirmative relief of directing plaintiff to proceed with the purchase of the subject premises, presumably based on the same Contract it contends is terminated. Accordingly, Defendant's motion to dismiss is denied.

Conclusion

For the reasons set forth above, Defendant's motion to vacate and cancel the Notice of Pendency dated March 25, 2013 affecting Block 8166, Lots 20 and 25 is granted but the motion to dismiss is denied.

Defendant's remaining requests to direct plaintiff to pay $190,000 and to require plaintiff to post a bond of $3,990,000 are denied in light of the cancellation of the lis pendens and otherwise not being supported by the record.

Dated:January 2, 2014___________________________

Bernice D. Siegal, J. S. C.