Tower Natl. Ins. Co. v A & C Real Estate Mgt. LLC
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Tower Natl. Ins. Co. v A & C Real Estate Mgt. LLC 2015 NY Slip Op 31822(U) September 18, 2015 Supreme Court, Suffolk County Docket Number: 10-40338 Judge: Joseph Farneti Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various state and local government websites. These include the New York State Unified Court System's E-Courts Service, and the Bronx County Clerk's office. This opinion is uncorrected and not selected for official publication. [* 1] I DEX o. CAL No. SllOIU l' ORM OJW l· R I 0-40338 15-00427CO SUPREME COURT- STATE OF EW YORK f.A.S. PART 37 - SUFFOLK COUNTY PRESENT: f Ion. JOSEPH FARNETI Acting Justice Supreme Court MOTION DATE 4-9-l 5 ADJ. D/\TJ: 4-23-15 Mot. Seq. # 006 - MotD ---------------------------------------------------------------:X TOWER NATIONAL INSURANCE COMPANY a/s/o NORTHERN VENTURES LLC d/b/a EI.DORADO SOUTHERN GRILL, MlTCTlELL J. DEVACK. PLLC Attorney for Defendant A & C Real Estate 90 Merrick /\venue, Suite 500 East Meadow, New York 11554 Plaintiff, - against A & CREAL ESTATE MANAGEMENT LLC and OCEAN SPRAY POOLS INC. d/b/a OCEAN SPRAY HOT TUBS AND SAUNAS, ANTHONY R. TOHILL, P.C. Attorney for Defondant Ocean Spray Pools 12 f.irst Street, P.O. Box 1330 Riverhead, New York l 1901 Defendants. ---------------------------------------------------------------:X Upon the fo llowing papers numbered I to _J]_ read on this motion for summary judgment; Notice of Motion/ Order to Show Cause and supporting papers I - 12 ; Notice of Cross Motion and supporting papers_; Answering Aflidavits and supporting papers 13 - 14 ; Replying /\ffidiavits and supporting papers 15 - 17 ; Other_; (a11d afte1 liea1 i11g eou1 1 ~el i11 supp<>1t 1111d ()pposed !o the 111ot1()1't) it is, ORDERED that the motion by the defendant A & C Real Estate Management, LLC for an Order. pursuant to CPLR 3212, granting summary judgment in its favor against the defendant Ocean Spray Pools Inc. d/b/a Ocean Spray llot Tubs and Saunas in the amount of$219,292.96, based on its cross claims against said codefcndant. is granted to the extent that summary judgment is awarded as to said codefendanrs liability for rent due and reasonable attorney's tees. and directing an immediate trial on these claims, and is otherwise denied. The plaintiff discontinued this action with prejudice against the defendants by stipulation dated July 21, 20 J 4, filed with the Clerk of the Court on September 11, 20 14. Said stipulation excluded the cross claims of the defendant A & C Real Estate Management, LLC ("A&C'') against the defendant Ocean Spray Pools Inc. d/b/a Ocean Spray Hot Tubs and Saunas ("Ocean Spray"). A&C's cross clai ms [* 2] Tower [nsurancc Company v A & C Real Estate Management LL(' Index Nu. I0-40J38 Page o. 2 sec!... to recover damages for unpaid rent and attorney" s lees allegedly due pursuant to a commercial lease between the parties dated December 23. 2005 ("'the lease"). It is undisputed that the plaintiff is the owner of 48-37B Ncsconset I lighway. Port Jefferson Station. ew York ("the premises"). that Ocean Spray executed tbc subject lease for the premises. and that the lease provided for the term to commcncc on delivery an<l c..:nd on November 13. 2015. Ocean Spray failed to make payment or the rent due November L 2.008, and by an undated letter advised /\.&C that it was "leaving" the premises and returned the keys to the landlord. By letter dated December 24, 2008. counsel for A&C notified Ocean Spray that. to the extent that the tender of possession and the keys wns intended to be an offer to surrender the premises it was rejected, and that the landlord " intends to enforce it rights under the I .case." /\.&C now moves for summary judgment in its favor on its second cross claim for rent in the amount of$219.292.96, and on its third cross claim for attorney's fees. In support of its motion. /\&C submits the anidavit of its managing member, the stipulation discontinuing the plaintiffs action, the relevant pleadings, the lease, the deposition of Ocean Spray's president, a copy of a lease for the premises with a new tenant dated February 18, 2011, and the above-referenced correspondence between the parties. In his affidavit, Joseph DiMaria ("DiMaria") avers that he is the managing member of A&C. that Ocean Spray took possession of the premises on or about December 23, 2005. that Ocean Spray abandoned the premises on or about December 12, 2008, and that the premises remained vacant until March 1, 2011, when it was able to re-let the premises to a new tenant He states that pursuant to the rent schedule in the lease, and the computation set forth in paragraph 8 of his affidavit, Ocean Spray owes rent in the amount of $219 ,292. 96 for the period November 1, 2008 to March I, 201 1 when the new tenant took possession of the premises. /\.this deposition, Joseph Musnicki testified that he is the president of Ocean Spray. and that h~ signed the lease for the premises on behalf of Ocean Spray. He stated that Ocean Spray vacated the premises in November or December 2008 after he met with DiMaria in an attempt to get a rent reduction, and that, when that was unsuccessfuL he made the decision to vacate the premises because business was "bad." He indicated that it was his understanding that the lease did not provide Ocean Spray a right to terminate the lease and leave the premises if business was poor. Paragraph 58 of the lease, entitled ''Bankruptcy or Other Default," provides in subparagraph 58.04 that: Tenant shall continue liable during the full period which would otherwise have constituted the balance of the term hereof, and shall pay as liquidated damages ... the Basic Rent and additional Rent and other charges ... and Landlord may rent the Demised Premises either in the name or the Landlord or otherwise ... without releasing the original Tenant from any liability. [* 3] Tower Insurance Company v A & C Real Estate Management 1.1.C' Index No. l 0-403.38 Page No. 3 Paragraph 24 of the Lease contains the following provision: No act or thing done by Owner or Owner's agents during the term hereby demised shall be deemed in acceptance of a surrender of said prem ises and no agreement to accept such surrender shall be valid unless in writing signed by Owner. No employee or Owner or Owner' s agent shall have any power to accept the keys of said premises prior to the termination of the lease and the delivery of keys to any such agent or employee shall not operate as a term ination of the lease or a surrender nf thc prem ises. The proponent of a summary judgment motion must make a primafacie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any material issue of fact (see Alv(lrez v Prospect Hospit(I/. 68 NY2d 320, 508 NYS2d 923 l l 986]: Winegnul v New York Univ. Med. Ctr. , 64 NY2d 85 l, 487 NYS2d 316 l 19851). The burden then shi fis to the party opposing the motion which must produce evidentiary proof in admissible form sufficient to require a trial of the material issues of fact (Roth v Barreto, 289 AD2d 557, 735 NYS2d 197 12d Dept 2001 I; Rebecchi v Whitmore, 172 AD2d 600, 568 NYS2d 423 [2d Dept 1991 ]; O'Neill v Fishkill, 134 AD2d 487, 521 NYS2d 272 [2d Dept 19871). Furthermore, the parties' competing interest must be viewed " in a light most favorable to the part opposing the motion'' (Marine Midland Bank, N.A. v Dino & Artie's A utom(ltiC Transmission Co., 168 AD2d 610, 563 NYS2d 449 r2d Dept I 990]). While it is true that a landlord's acceptance ofa surrender of the lease will gt;nerally release the tenant from further rental obi igation under the terms of the lease, the parties arc free to contract otherwise (Chestnut Realty Corp. v Kaminski, 95 J\03d 1254, 945 NYS2d 708 [2d Dept 2012)). Tkrc. the lease contains a clause which establishes that the parties have contracted to provide a method for the tenant to surrender the premises. lt is undisputed that Ocean Spray has not requested, nor has A&C provided, a writing accepting any purported surrender of the premises. Whether or not a surrender by operation of law has occurred in a particular case is a factual determination (Ford Coyle Props., Inc. v 3029 Ave. V Realty, LLC, 63 J\03d 782, 881 NYS2d 146 [2d Dept 2009), and where the pertinent facts are not disputed, the determination is made as a matter of law (Brock Enters. v D1111'1am 's B(ly Boat Co., 292 AD2d 681, 738 NYS2d 760 [3d Dept 2002]). It is determined that Ocean Spray vacating of the premises and delivery of the keys did not operate as a surrender of the prem ises (Hudson Towers Hous. Co., Inc. v VIP Yacht Cruises, Inc., 63 AD3d 4 13, 881 NYS2d 46 [I st Dept 2009); see e.g. Conm111ght Tower Corp. v Nagar, 59 AD3d 2 18, 873 NYS2d 553 [1st Dept 2009]). In addition, paragraph 19 of the Lease provides that: ff Tenant shall default in the observance or performance of any term or covenant ... and if Owner in connection therewith or in connection "With any default by Tenant in the covenant to pay rent, makes any expenditures or incurs any obligations for the payment or money, including but not limited to attorney's fees, in instituting prosecuting o r defending any [* 4] Tower Insurance Company v /\ & (' Real Estate Management I,LC Index No. t 0-40338 Pagt.: No. 4 actions or proc.:e~dings. such sums so paid or obligations incurred ... shall ht.: deemed additional rent hercurn.kr and shall be pai<..I hy Tenant to Owner. Where a provision in a lease provides for the payment of attorney's Ices if the landlord shou ld be compelled to institute proceedings due to the tenant 's default under the lease, the landlord is entitled to recover the reasonable amount of his or her attorney" s fees (715 Ocean Parkway Owners Corp. v Klagsbru11 , 74 AD3d 13 14, 905 NYS2d 630 f2d Dept 20101; LeVine v Catskill Regional Off-Traci< Betting CoqJ. , 57 AD3d 624, 87 J NYS2d 191 pd Dept 20081). Movant having established its primaf{l(:ie entitlement to summary judgment as to Ocean Spray's liability for rent and attorney's fees, it is incumbent upon Ocean Spray to produce evidence in admissible form sufficient to require a trial of the material issues of fact (Rotlt v Barreto. suprn; Rebecclli v Whitmore, supra; O'Neill v Fishkill, supra). ln opposition to the instant motion. Ocean Spray submits the affirmation orits attorney. In his affirmation, counsel for Ocean Spray contends that inforn1ation demanded at DiMaria's dl!position "bearing directly on issues of fact <md issues ofl aw·· regarding A&Cs ··efforts to mitigate damages'' has not been provided by J\&C, and that DiMario 's calculation of the rent owed is in error and actually '·equals 214.292.96." In essence, Ocean Spray contends that this motion for summary judgment is premature, and that A&C has not proven the amount of damages it is entitled to receive. It is well-settled that once the tenant has abandoned the premises prior to the expiration of the lease, the landlord is within its rights to do nothing and collect the full rent due under the lease (Holy Props. v Cole Prods. , 87 NY2d 130. 637 NYS2d 964 11995 J; RljP A8 LLC v Aventura Teclz., Inc. , 68 AD3 d I 087, 893 NYS2d 83 f2d Dept 20091). IIere, the lease terms do not require the landlord to mitigate its damages. "(Sjummary judgment cannot be avoided by a claimed need for discovery unless some evidentiary basis is offered to suggest that discovery may lead to relevant evidence" (Williams v D & J School Bus, 69 /\D3d 617, 893 NYS2d 133 l2d Dept 20 10]; Pmwsuk v Viola Park Realty, 41AD3d804, 939 NYS2d 520 f2d Dept 20071). The facts surrounding A&C's "efforts to mitigate damages" are not relevant to this action. ln addition, A&C is not required to establish the amount of its damages in order to succeed on its motion. "The point of CPLR 3212 ... is precisely to determine all issues except damages on a motion where. as here, it is reasonable to infer that there probably arc damages from the breach" (Northway Mall Assoc. v Bernlee Realty Corp.. 90 /\D2d 739, 739, 455 NYS2d 684, 685 11 st Dept 19821; see 30 Broadway, LLC v Grand Cent. Dental, LLP, 96 AD3d 934. 947 NYS2d 545 (2d Dept 2012j). In its reply, A&C acknowledges that the calculation of the rent owed by Ocean Spray set forth in Di Mario's af'fidavit contains what it calls a "typographical" error, and that the amount due is actually $21 4,292.96 as Ocean Spray claims. Regardless, in Ocean Spray's undated letter returning the keys to the premises, Joseph Musnicki writes that it is with "regret that I must leave [the premises). Please keep the 2 months security." A&C submission does not indicate whether it credited Ocean Spray for the two months security, or the amount of security in its possession at the time of the abandonment of the [* 5] Tower Insurance Company v A & C Real Estate Management LLC' Index 'o. I 0-40338 Page No. 5 premises. either docs A.&C suhmit any evidence as to the amount of its attorney's Ices in prosecuting its cross claims. Accordingly. A&Cs motion for summary judgment is granted as to the liability of Oct!an Spray for rent owed and attorney's fees, and this matter is set down for an immediate trial as to damages. Upon service of a copy of this Order with notice oC entry, the Calencl!ar Clerk ~) r thi s Court is di rcctcd to place this action on the Calendar Control Part calendar for the next available trial date. Dated: September 18, 20 15 FINAL OJSPOSITION _X_ NON-FINAL DISPOSITION
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