Marion Scott Real Estate, Inc. v Riverbay Corp.

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Marion Scott Real Estate, Inc. v Riverbay Corp. 2016 NY Slip Op 31216(U) June 20, 2016 Supreme Court, New York County Docket Number: 653953/14 Judge: Paul Wooten 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. [*FILED: NEW YORK COUNTY CLERK 06/27/2016 11:39 AM 1] INDEX NO. 653953/2014 " RECEIVED NYSCEF: 06/27/2016 " NYSCEF DOC. NO. 41 SUPREME COURT OF THE STATE OF NEW YORK- NEW YORK COUNi I· I' PRESENT: PART_7_ HON. PAUL WOOTEN Justice l! I MARION SCOTT REAL ESTATE, INC., i' I' Plaintiff, 6539~/14 INDEX NO. - againstMOTION SEQ. NO. 0021,\ RIVERBAY CORPORATION, Defendant. 1: ll t: [i ,, " i' The following papers were read on this motion by defendant for summary judgment. PAPERS NUMBE.ED i' Notice of Motion/ Order to Show Cause - Affidavits - Exhibits ... Answering Affidavits - Exhibits (Memo)_ _ _ _ _ _ _ _ __ Replying Affidavits (Reply Memo)_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ Cross-Motion: D Yes • No " This is an action sounding in breach of contract, defamation, preliminary injunction, \~nd I i,i trespass commenced by Marion Scott Real Estate, Inc. (plaintiff or MSI} against Riverbay 1 • \'i Corporation (defendant or Riverbay} for suspending its role as the Managing Agent of I\ 1,\ I! Cooperative City (Co-Op City). Before the Court is a motion by the plaintiff, pursuant to C~R " I' 3212, for partial summary judgment on its second cause of action in the Verified Complaint~or breach of contract awarding plaintiff: (i) unpaid management fees in the amount of $641, 557. 00; (ii) management fees for each successive month after March 2015 until , \j defe~ant obtains the requisite approval from the New York State Division of Housing and Community~;. Renewal (DHCR) with respect to defendant's termination of MSI as Managing Agent; and (ii il i j! attorneys' fees and litigation costs incurred by plaintiff in commencing the instant action necessitated by defendants' willful and material breach of contract. Defendant is in oppositi I, 1: to the motion. Discovery in this matter is not complete and the Note of Issue has not yet bet ' [! h filed. i! " \; Page 1 of 12 1 of 12 [* 2] BACKGROUND Riverbay is the cooperative housing corporation of the housing development kno~ as 1: Co-Op City, located at 2049 Bartow Avenue, Bronx, New York (Pl Aft in support 114). Co.\bp 1: City is a Mitchell-Lama whose operation is governed by regulations promulgated by the D~CR. i. I "Co-Op City is comprised of 15,372 apartment units, in 25 high-rise buildings, and seven 'i ' townhouses, accommodating approximately 60,000 residents" (id. at 5). In 1998 plaintiff '1d I Riverbay entered into a contract for a period of one year, which incorporated by reference \ihe I'. ; "General Conditions of the Contract for Managing Agent", wherein plaintiff was hired as th. Managing Agent for Co-Op City {collectively, the Contract) (plaintiff exhibit A). Plaintiff not~s ,. i that the DHCR's Mitchell-Lama regulations are incorporated by reference into the Contract~!. ,. specifically§§ 1729-1.1. through 1729-1.2 {plaintiff exhibit A at 5). Section 5 of the Contra~t [/ states that the Contract term shall be for one year and thereafter, "it shall continue in full f~ce I 1 and effect from month-to-month unless renewed or terminated as provided in the General 1: i Conditions of the Contract for Managing Agent" (plaintiff exhibit A. p. 2). Plaintiff states that as Managing Agent of Co-Op City its duties are as follows: "as Managing Agent, oversees all aspects of the day to day running of Co-Op City including, but not limited to: physical maintenance of the development, overseeing the safety officers, negotiating and administering construction contracts, providing for utility services, overseeing the financial administration of the development, ensuring appropriate vetting process for new hires, handling requests for service and overseeing construction, repair, maintenance and replacement of heating plants and all other mechanic systems and equipment in the development" (Plaintiff Aft in Support 1J 9; Freedman Aft. 118). i: Plaintiff avers that in May of 2014, Riverbay held a board election which resulted int~ p election of new board officers and members, including Cleve Taylor (Taylor), who was electf President (plaintiff Aft in Support 1J1 O; Affidavit of Herbert D. Freedman [Freedman Affidavit]~\ 11 Secretary of MSI, 1J 9). After Taylor was elected President, plaintiff claims that he "began a I· !, systematic campaign to oust [plaintiff] by falsely maligning and disparaging [plaintiff] to the Page 2of12 i!: I. l; \ i,1 2 of 12 i [* 3] \, board members and tenants of Co-Op City ... and to the public at large" (Freedman Affi~vit 1J ;i: 10). Specifically, according to plaintiff, Taylor terminated plaintiff by directing Riverbay siurity officers to stop plaintiff's employees from entering their offices at Co-Op City "under the ~ise \t that it was indefinitely suspending [plaintiff]) (id. at 11 ). On November 17, 2014, upon arri~ing at their office at Co-Op City, Freedman claims that plaintiff's employees were blocked fro~ 1\ 1: access to their office, corporate files, documentation and computers (id. at 12). Plaintiff \\ :\ \, maintains that this action can be considered the equivalent of a termination. Plaintiff furth~r, avers that these actions were undertaken by Riverbay without the required authorization f~m r· DHCR, United States Department of Housing and Urban Development (HUD) or Wells Fa'o to terminate plaintiff, and Riverbay failed to abide by the termination process set forth in the \\ \l Contract and in DHCR regulation 9 NYCRR § 1729-1.2(1), as well as HUD's Multi-Party 1: i\ I" Coordination Agreement (MPCA) § 6(a) (Freedman Affidavit at 1J 13; plaintiff Aff in Supportl~~t i\ 11 t\ 1{12). I Article 9 of the Contract, which sets forth the circumstances in which Riverbay may \ 'i 11 terminate MSI, states the following: \!, "The Contract between the Managing Agent and Riverbay Corporation may be terminated as follows: a. by mutual consent upon thirty (30) days written notice to DHCR; b. by DHCR, with cause, such termination to be effective immediately upon notice to Riverbay Corporation and Managing Agent; c. by DHCR, without cause, upon thirty (30) days written notice to Riverbay Corporation and Managing Agent; d. by Riverbay Corporation or DHCR effective immediately upon notice in the event a petition in a bankruptcy is filed by or against either Riverbay Corporation or Managing Agent, or in the event that either should make an assignment or the benefit of creditors or take advantage of any insolvent act; e. e. by Riverbay Corporation or Managing Agent effective immediately upon notice if Riverbay Corporation or Managing Agent shall fail or refuse to comply with or abide by any rule, order, determination, ordinance or law of any Federal, Page 3of12 3 of 12 I! II t: IIii ! i: [* 4] i: i' I I f. I' il State or Municipal Authority, upon giving twenty-four hours written notice mailed to Riverbay Corporation or Managing Agent at its address first hereinabove set forth or; by Riverbay Corporation upon not less than thirty (30) days written notice to the Managing Agent in the event of a bona fide sale or demolition of property" (Freedman Aff. 1[6, The Contract at plaintiff's plaintiff's exhibit A, p. 12, Article 9). i\ ii II ll " II H 11 il !, ! 1. i 1' I i I \; In support of its motion plaintiff submits an affirmation of its attorney, Steven E. S~da, i\ ' t 1: Esq. (Spada Aff.), and the Freedman Affidavit. Plaintiff also attaches the 1998 Contract, I( well as a letter dated November 18, 2014 from the Assistant Commissioner of DHCR, 11, " Richmond McCurnin (McCurnin), to Taylor, Riverbay's President, which, inter alia, directs laylor I' to reinstate plaintiff as managing agent of Co-Op City, pending the completion of the DHC~'s investigation (plaintiff exhibit B). Lastly, plaintiff attaches the "AMENDED EMERGENCY \i ii ,: Resolution #14-72 CONDUCT OF MANAGING AGENT" dated November 19, 2014, by the\\ Board of Riverbay, wherein the Board resolved to have both Riverbay's General Counsel a~d 11 DHCR investigate the plaintiff, and if DHCR finds after a review "that [plaintiff] failed to co~ly i! with the management agreement, or that [plaintiff]'s performance is not satisfactory, or that I ; [plaintiff] failed to comply with any law, regulation or [D]HCR directive, that {D]HCR should t! terminate the expired management agreement between Riverbay and [plaintiff]" (plaintiff e~ibit i! Ii,! C). In opposition, defendant proffers that plaintiff's motion must be denied because: 1) i~l 1: failed to attach the pleadings to its motion, as required by CPLR 3212(b); 2) it is premature;\1$) it 1: fails to demonstrate or even address the proper measure of damages; and 4) even if the 1: plaintiff were otherwise entitled to partial summary judgment on its breach of contract claim, \,he i( doctrine of setoff would preclude such relief. It is uncontested by the parties that pursuant t'i DHCR provision 9 NYCRR § 1729-1.2(1), DHCR must approve any termination of plaintiff asl~ts 11 I; managing agent. !! ', Page 4of12 i i> \\ 4 of 12 \! I,' l [* 5] It is Riverbay's position that its annexed documentary evidence and plaintiff's ow!l> [! 'I admissions either confirm or raise substantial questions of fact as to whether plaintiff ha~! " lt engaged in serious misconduct, warranting denial of the plaintiff's motion. Specifically, \! ' Riverbay avers that the above shows that plaintiff has failed to comply with the managem~nt agreement, raises substantial questions of fact as to whether plaintiff's performance was i· satisfactory, and whether plaintiff failed to comply with any law, regulation or DHCR regul-ion. ;I Additionally, Riverbay contends that it has not had the opportunity for discovery on its def~se ;· that plaintiff forfeited its right to payment under the contract through such alleged miscon~ct. ! It also avers that discovery of these matters would lead to evidence that would successfully allow it to defeat this motion. Additionally, it is in deference to 9 NYCRR § 1729-1.2(1) that Riverbay asserts that\it i suspended plaintiff from performing any duties as Managing Agent of Co-op City, and suspended payments to plaintiff, pending completion of the investigations of DHCR and Riverbay's General Counsel. Riverbay contends that plaintiff has engaged in the following,\! :, ;,, 1., alleged misconduct: mishandling employment matters for Riverbay in violation of the i· ,. management contract and federal and state laws; misclassifying employees as independe~ I' 1 contractors and more as exempt management employees in violation of the Management Contract; binding Riverbay to not less than $8,300,000.00 a year of insurance premium contracts without public bidding, Board authorization, or New York State approval and i1 i; I' i: failin~\to ',: i comply with New York State regulations requiring fidelity bonds; utilizing a paid employee of\: Riverbay for plaintiff's benefit, without authorization or knowledge of Riverbay; and mismanaging capital projects (Affidavit of Cleve Taylor [Taylor Affidavit] ~ 7). ,, In support of its opposition, Riverbay submits a Memorandum of Law and theTaylor Affidavit. Riverbay also submits a plethora of documentary evidence, which it contends evidences or raises substantial questions of fact as to plaintiff's misconduct in its role as Managing Agent of Co-Op City, which includes, inter alia, two decisions in a matter entitled i I Page 5of12 5 of 12 [* 6] Ramirez, et al., v Riverbay Corp., et al., 13 Civ. 2367, before District Judge John G. Koel. of I' il the United States District Court, Southern District of New York, brought by employees forl\ I: minimum wage and overtime compensation violations under the Fair Labor Standards A1 and ti the New York Labor Law, wherein both plaintiff and Riverbay were named as defendants ~see Taylor Affidavit p. 4-5; Riverbay's exhibits A and B). The August 1, 2014 decision, inter a~. '1' granted partial summary judgment to two of the individual plaintiffs on two of their claims ' r unpaid overtime, preserving the remaining claims and the issue of liability for trial (Taylor \1 certifi~d a Affidavit p. 4; Riverbay exhibit A). The second decision, dated also August 1, 2014, ii class action, composed of approximately .1. 700 current and former employees for alleged \\ unpaid overtime and related wage and hour claims (Taylor Affidavit p. 4; Riverbay exhibit ~. ir 1' Riverbay also submits "A Basic Management Plan for Riverbay Corp. Inc. Submitted By: ~rion Scott Real Estate, Inc." (Management Plan), which Riverbay states is a contractual agree~nt ,, tl between it and plaintiff, which states, inter alia, that plaintiff "and its site employees are 'r; I: !j responsible for compliance with all applicable laws" (Taylor Affidavit p. 5; Riverbay exhibit QP. rl Riverbay contends that the Ramirez decisions "unequivocally establish that [plaintiff] breac~d i[ its contractual obligations under the management agreement with Riverbay. According to .\l 11 tl Judge Koeltl, the employment practices at Riverbay for which [plaintiff] was responsible unctr H the Management Plan violated State and Federal Law" (Taylor Affidavit at p. 5). " 'i 11 Riverbay also attaches to its opposition a series of email correspondence, dated i Ir November 19, 2014, between Riverbay's General Counsel Jeffrey Buss {Buss) and, interalf, ii'. Freedman, wherein Buss sent three written information requests to plaintiff regarding plaintif's 11 I current employment policies (Riverbay exhibit D). In one such email, Buss asks Freedman 1: ,. I' whether plaintiff was using any Riverbay employees to provide services for non-Riverbay \:: f! matters, and if so, directing that such practice must cease immediately (Riverbay exhibit D). \! I: i Freedman's email responses to Buss is also attached, dated November 19, 2014, wherein \i, I Freedman states that plaintiff does not use Riverbay employees working on Riverbay time to\' I 1,\ Page 6of12 6 of 12 [* 7] provide services for plaintiff or other housing companies, and that plaintiff "believe[s] tha~:all I current employment practices (before we were suspended) are in accordance with law b~ it ii would be prudent to have legal counsel review'' (id.). It is Riverbay's position that plainti1 response to these information requests was that it did not know whether its current empl~ment I· wit~ the practices are in accordance with State and Federal law, and that they failed to comply i' ii;'. Ii advice of labor counsel and failed to acknowledge to Buss that it had done so, which is evidence of "on~going, improper management" (Taylor Affidavit, p. 8). Riverbay also atta~es \t an email to Freedman from special labor counsel Scott Trivella (Trivella} regarding the 42 classification of certain employees, advising Freedman that they should be classified as employees, not independent contractors (Riverbay exhibit E). \:i I ii i! I· Additionally, Riverbay attaches the minutes of a Riverbay Board meeting, dated fl 1 1i Ii November 6, 2014, wherein Riverbay avers that in "an effort to understand why Riverbay h~d I no insurance coverage for the Ramirez matter, the Board invited Riverbay's Director of Ris'1 i wh~rein Management to attend and provide a presentation on insurance coverage to the. board" ,. [1 plaintiff also attended (Taylor Aff., p. 9-10; Riverbay exhibit F). Also attached to Riverbay's\\ opposition are a series of emails, and a spreadsheet, which Riverbay avers evidence the fa~t I· that Riverbay's Director of Risk Management was working on negotiations for insurance \\ I coverage for non-Riverbay properties, for the benefit of plaintiff, during the workday for all I; i: I! I instances of this practice (see Riverbay exhibits Hand I). ill' 1' i\ In reply, plaintiff attaches, inter alia, a reply Affidavit of Freedman, a copy of the ', : I' pleadings (Reply exhibit D), and an amendment to the Contract dated March 6, 2013, entitle~ !\ Extension of the Contract for Managing Agent (2012-2013 Extension), wherein plaintiff's I! monthly fee was increased to $128,315.00 {Plaintiff Reply exhibit E). STANDARD Summary judgment is a drastic remedy that should be granted only if no triable i' i issue~ of 1: fact exist and the movant is entitled to judgment as a matter of law (see Alvarez v Prospect \! i,, Page 7 of 12 I,: i', i 1,l 11· ii 7 of 12 [* 8] of law, tendering sufficient evidence in admissible form demonstrating the absence of ma.rial 1: I., issues of fact (Ostrov v Rozbruch, 91AD3d147, 152 [1st Dept 2012], citing Alvarez v Pro~ect II ,. Hospital, 68 NY2d 320, 324 [1986]; Santiago v Fi/stein, 35 AD3d 184, 185-186 [1st Dept ~06], quoting Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]; CPLR 3212 [b]).\\A \i 1 failure to make such a showing requires denial of the motion, regardless of the sufficiency 1e>f I: the opposing papers (see Smallsv AJI Indus., Inc., 10 NY3d 733, 735 [2008]). Once a priltia ~ facie showing has been made, however, "the burden shifts to the nonmoving party to ' prod~ce . Ii evidentiary proof in admissible form sufficient to establish the existence of material issues *f !, fact that require a trial for resolution" (Mazurek v Metropolitan Museum of Art, 27 AD3d 221, i~ 228 [1st Dept 2006]; Giuffrida v Citibank Corp., 100 NY2d 72, 81 [2003]; Zuckerman v Cit}1of ,. I• 11 New York, 49 NY2d 557, 562 [1980]; DeRosa v City of New York, 30 AD3d 323, 325 [1st ~pt I' 1' 2006]). '1: I' 1: When deciding a summary judgment motion, the Court's role is solely to determine ~ I any triable issues exist, not to determine the merits of any such issues (see Sillman v Twerifjeth Century-Fox Film Corp., 3 NY2d 395, 404 [1957]). The Court views the evidence in the lig~ most favorable to the nonmoving party, and gives the nonmoving party the benefit of all I: !• 11 I reasonable inferences that can be drawn from the evidence (see Negri v Stop & Shop, lnc.,j~5 ~ ; NY2d 625, 626 [1985]). If there is any doubt as to the existence of a triable fact, the motionl•for I· 11 summary judgment must be denied (Rotuba Extruders v Ceppos, 46 NY2d 223, 231 [1978];1 : 1 Grossman v Amalgamated Haus. Corp., 298 AD2d 224, 226 [1st Dept 2002]; CPLR 3212[b]~. ,, I' I I Page 8of12 8 of 12 [* 9] DISCUSSION As a threshold matter the Court will not dismiss plaintiff's motion for failure to atta~h the 'i pleadings. "Although CPLR 3212 (b) requires that a motion for summary judgment be 11 ~efect supported by copies of the pleadings, the court has discretion to overlook the procedural " '.i of missing pleadings when the record is 'sufficiently complete"' (Washington Realty Ownelts, ,I LLC v 260 Wash. St., LLC, 105 AD3d 675, 675 [1st Dept 2013], quoting Welch v Hauck, 1~ Ii 1: AD3d 1096, 1098 [3d Dept 2005] Iv denied 5 NY3d 708 [2005]). "The record is sufficientlj! i' complete when, although the movant has not attached all of the pleadings to the motion, ~i I " complete set of the papers is available from the materials submitted" (Washington Realty I' : Owners, LLC v 260 Wash. St., LLC, 105 AD3d at 675). Here, while the plaintiff failed to a~nex l! the pleadings to its initial moving papers, the pleadings were attached to the reply, and as i•uch ti this Court has a complete set of papers upon which to decide the motion (see Pandian v ~w ! York Health & Hosps. Corp., 54 AD3d 590, 591 [1st Dept 2008] ["we reject the contention ~at i the court should have dismissed defendants' motion for failure to annex their answer to th1! initial moving papers, inasmuch as the responsive pleading was attached to the reply papeJ\s"]). i• Now in turning to the merits, the Court finds that plaintiff has met its prima facie entitlement to summary judgment on its breach of contract claim. Pursuant to DHCR Regulation 9 NYCRR § 1729-1.2(1), The agreement between the managing agent and the housing company may be terminated as follows: "(1) by mutual consent upon 30 days' written notice to the division; (2) by the division, with cause, such termination to be effective immediately upon notice to the housing company and agent; (3) by the division, without cause, upon 30 days' written notice to the housing company and agent; (4) by the housing company or the division effective immediately upon notice, in the event a petition in bankruptcy is filed by or against either the housing company or agent, or in the event that either should make an assignment for the benefit of creditors or take advantage of any insolvency act; (5) by the managing agent effective immediately 1,.Jpon notice if the housing Page 9of12 9 of 12 1: I I \: I' rl I II I I [* 10] company shall fail or refuse to comply with or abide by any rule, order, . determination, ordinance or law of any Federal, State or municipal authority, upon giving 24 hours' written notice mailed to the housing company at its address; !' (6) by the housing company upon not less than 30 days' written notice to tl')e agent in the event of a bona fide sale or demolition of the property; :•. (7) by the housing company with cause upon prior approval by the division~~ I' It is undisputed between the parties that the last extension to the Contract had ex~red and plaintiff was serving as Managing Agent on a month-to-month basis at the time that p~intiff .. was denied access to its Co-Op City offices. The parties' 1998 contract establishes a 12-month duration period, and in the event the contract is not extended, "it shall continue : i. lh full I • I force and effect from month-to-month unless renewed or terminated as provided in the G~eral •' I. Conditions of the Contract for Managing A-gent" (plaintiff exhibit A, p. 2). According to Rivtrbay, \ i. plaintiff and Riverbay last contracted, for a one-year term in October 2012 (Taylor Affidavi~1at I'. 2). However, the documentary evidence before the Court shows establishes that the 201~• i Ii 2013 Extension was the latest extension to the Contract, for a term of twelve months from ~uly ii' ' 1, 2012 to June 30, 2013 (plaintiff reply exhibit E). In the 2012 Extension the plaintiff's mo~thly I' I fee was increased to $128,315.00 (Plaintiff Reply exhibit E). Thus, after June 2013, the duration period became month-to-month, and the parties' agreement could only be termin$d 1: !~ pursuant to the DHCR's termination provisions, which were incorporated into the parties' i: agreement II The Court also turns to November 18, 2014 letter from McCurnin, the DHCR's Assi~ant i: i Commissioner, directed Taylor to "immediately reinstate [plaintiff]'s. employees, pending the completion of [DHCR's] investigation" (plaintiff's exhibit B). McCurnin also stated that Taylor's "unilateral decision to indefinitely 'suspend' all of the managing agent's employees at Riverbay, pending a review by the Board and [D]HCR ... is in violation of [D]HCR regulations and Riverbay's obligations under their Wells Fargo/HUD loan documents" (id.). McCurnin notes that whether or not Riverbay's suspension of plaintiff "can be considered the equivalent of a termination, HUD's MultiPage 10 of 12 1; ! 10 of 12 [* 11] Party Coordination Agreement ("MPCA") states that "all changes to the managing agent will require approval by HUD••. and DHCR' (see, MPCA §6(a}). In addition, HUD's regulatory agreement prohibits Riverbay from " ... chang[ing} any arrangement for managerial sevices... " without HUD's prior Ii written approval (see Reg. Agr. §36)" (emphasis in original} (id.). \\ p 1: In opposition, Riverbay has failed to raise a triable issue of fact. Notwithstanding f,le 11 1 serious allegations of misconduct by Riverbay against plaintiff, Riverbay's immediate 1i . \i I' suspension of plaintiff in November 2014 was a change to the arrangement for manageritt il services in violation of the month-to-month contractual agre.ement with plaintiff, and which\'railed I to comply with the termination provisions set forth in Article 9 of the Contra cf s General Conditions (plaintiff's exhibit A and E; 9 NYCRR 1729-1.2(1}; see e.g. Marion Scott Real I E~ate, " I Inc. v Rochdale Village, Inc., 23 Misc3d 1129[AJ, 2009 NY Slip Op 50997[U], *1-5 [Sup Ct.'!! 11 1: u Queens County 2009]). 1; 1. 1, Plaintiff's compensation under the 2012-2013 Extension was $128,315.00 a month ii " ii (Reply exhibit E), and it is undisputed that since October 2014 Riverbay has failed to mak,\any payments to plaintiff (Freedman Aff in reply~ 22; Taylor Aff ~ 4). Since plaintiff was Riveiy's managing agent on a month-to-month basis, the measure of damages is the duration of its\! suspension, from November 2014 through the present, or until such time as there is a findi~g of i! · termination by the DHCR. Additionally, Section 6 to the Contract, entitled "Compensation",\\ Ii states that "[t]he Managing Agent shall be compensated on a lump sum basis that has bee~ proposed by the Managing Agency and accepted by Riverbay Corporation" (plaintiff's exhii A, p. 2). i\ !; ' To the extent that plaintiff in its first cause of action seeks attorney's fees, this claim\~ 11 denied for plaintiffs failure to establish entitlement to same (see Atlantic Development Grou~>, 'Ii LLC v 296 East 1491h 1: Street, LLC, 70 AD3d 528, 529 [1st Dept 2010] ["[A]ttorney's fees are\! incidents of litigation and a prevailing party may not collect them from the loser unless an av#ard 1,1 is authorized by agreement between the parties, statute or court rule"]; Hooper Assoc. v AG~ I I; Computers, 74 NY2d 487, 491 [1989]; U.S. Underwriters Ins. Co. v City Club Hotel, LLC, 3 , ·11 Page 11of12 11 of 12 [* 12] NY3d 592, 597 [2004] [In New York, "a prevailing party may not recover attorneys' fees frif;>m the losing party except where authorized by statute, agreement or court rule"]; Chapel v 't: . !i i\ Mitchell, 84 NY2d 345, 349 [1994]). Plaintiff has not established that its contract with Riv~rbay included the payment of legal fees, and such payments are not authorized by any statute ~r I court rule. Accordingly, plaintiff's motion for summary judgment on the first cause of acti~ for I'. breach of contract is granted to the extent stated above. it CONCLUSION Accordingly it is, t; '\! ORDERED that plaintiff Marion Scott Real Estate, lnc.'s motion, pursuant to CPLR\\ \: I 3212, for partial summary judgment on its second cause of action in the Verified Complai1 ~ against the defendant for breach of contract is granted; and it is further, ; It i' ii, ORDERED that the amount of damages to which Marion Scott Real Estate, Inc. is \i Ii entitled as a result of said breach is hereby referred to a Special Referee to Hear and \\ Determine except that, in the event of and upon the filing of a stipulation of the parties, as \i ,, permitted by CPLR 4317, the Special Referee, or another person designated by the partie,\to serve as referee, shall determine the aforesaid issue; and it is further, Ii,, f~ ORDERED that the portion of plaintiff Marion Scott Real Estate, Inc. 's motion for 1t ii 11 summary judgment seeking attorneys' fees and litigation costs is denied; and it is further, " 1: I! ORDERED that counsel for plaintiff Marion Scott Real Estate, Inc. is directed to se1 a copy of this Order with Notice of Entry upon the defendant, on the Clerk of the General ClerJ's 1; 10 1; Office to arrange a date for the reference to a Special Referee, and the Clerk of the Court is directed to enter judgment accordingly. \\ This constitutes the Decision and Ord :' I' H l I I Check one: • FINAL DISPOSITION 0 NON-FINAL DISPOSITION Check if appropriate: : DO NOT POST 0 REFERENCE 0 \ I '1 Page 12 of 12 12 of 12

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