Engelbert v Zeitlin

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Engelbert v Zeitlin 2018 NY Slip Op 32703(U) October 22, 2018 Supreme Court, New York County Docket Number: 653189/2016 Judge: Marcy Friedman Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. [*FILED: 1] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 SUPREivlE COURT OF THE STATE O:F NEW YORK COUNTY OF NEW YORK: COMMERCIAL DIVISION PART 60 ---------------------------------------------------------------------){ INDEX NO. OSCAR ENGELBERT Plaintiff, 653189/2016 MOTION DATE -v- MOTION SEQ. NO. JIDE ZEITLrN, Defendant 003 DECISION ANO ORDER HON. MARCY S. FRIEDMAN: The following e-filed docmnents, listed by NYSCEF document number (:rvfotion Seq. No. 003) 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93, 94, 95, 96, 97, 98, 101, 102, 103, 104, 105, 106, 107, 108, 109, 110, 111, 112, 113, 114, 115, 116, 117, 118, 119, 120, 121, 122, 123, 124, 125, 126, 127, 128, 129, 130, 131, 132, 133, 134, 135, 136, 137, 138, 139, 141, 142, 143, 144, 145, 146, 147, 148, 149, 150, 151, 152, 153, 154, 155, 156 SUMJvlARY JI IDGMENI _____________________________________ , \Vere read on this motion to/for In this action, plaintiff Oscar Engelbert seeks the return from defendant Jide Zeitlin of his down payment of $825,000 toward the purchase from Zeitlin of a cooperative apartment Engelbert moves, pursuant to CPLR 3212, for summary judgment Zeitlin cross-moves, pursuant to CPLR 3212, for sumrnary judgment "directing the Court, as escrow agent, to deliver to [Zeitlin] the contract deposit of $825,000 currently being held in escrow." The following facts are undisputed unless otherwise stated, Zeitlin is the owner of apartment units 6A and 6B (together, the Unit) in the "residential cooperative housing 1 1 of 19 [*FILED: 2] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 cooperation [sic]" located at 121 Greene Street in Manhattan (the Co-op). (Joint Statement of Material Undisputed Facts [Jt. St.], i! 2.) Pursuant to a contract of sale made as of October 24, 2014 (the Contract), Engelbert agreed to purchase the Unit from Zeitlin for $8,250,000. (ld.,, ~ 3; Contract, 1~ Ll-L L2, L 16 [Aff of William McCracken (PL's Atty.) In Supp., dated July 31, 2017 (McCracken Aff), Ex. Dl) 1 Upon signing the Contract, Engelhe1t made a 10%> dow11 payment of $825,000, which was delivered to and initially held by Zeitlin's attorney as escrow agent. (Jt St, ~[1[ 4-5.) Pursuant to the Contract, Zeitlin, as Seller, agreed (i) "to have removed as of record all Violations attributable to work done in the Unit or as a result of the condition of the Unit, including but not limited to, the Partial Stop Work Order presently pending, as well as all liens or judgments which might affect the Unit;" and (ii) "to cooperate with First American Title Insurance Company and satisfy all conditions required for them to issue an Eagle 9 policy." (Jt. St,~ 7; Contract Rider,~! 46.) "[I]t was a condition to dosing for all Violations attributable to work done in the Unit to be removed, induding the Partial Stop Work Order, and for First American Title Insurance Company to issue an Eagle 9 policy." (Jt St, ~ 8, citing Contract, ir 15.1, Contract Rider,~[ 46.) "[T]he closing was also 'subject to the unconditional consent of the Corporation [i.e., the Co~op]."' (Jt St, i; 9 [brackets in original], quoting Contract,,[ 6. L) The parties \Vere required to "each cooperate with the other, the [Co~op] and title company, if any, and obtain, execute and deliver such documents as are reasonably necessary to consummate this sak" (Contract,~· 24.1; Jt St.,~ 10.) ' As the Contract refers to its provisions as paragraphs, rather than as sections, the comt will also do so. 2 2 of 19 [*FILED: 3] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 ~'Ift}1~~ [C:o~·{lpj has r.~ot iYt]t.le a dee.Is.ion or1 or l";e_f-~).re tht.~ Sc.hedulccl c:.!os1rtt:~ IJate~~ tl1e c:.losi.r1g shall be :adjcn1r11f.:;d for JO l)liShlt:SS d{·lYS f~JI th.e r~u.rpos(:~ of ol;tair1ir1g st1c1-1 conse.nt Lf s1~c-h co.r1serrt is not c:oI1tra.ct 1:~y N"otjc.t\ :provided. th.at the f(~{}.. Op:'s] C011St~rrt is r1ot isstiecl l;efo.re suc.11 Notice of ca~nc.e~ lation, is gr~.:{~rL rf Stlc.h c.onse.t}t is reft~sed at a_ny ti.rnt\~ either r:arty n·1ay· car1ce~ this (~ontr,act by ~[\J°olic.e., itl t11e eVf.~.rit of CHi1C·C~ ~atio.r1 f)UIS~.larrt to this [~~jcj 16. 3, the I~:sc.rO\·Vt~e sl}a.11 refttncl th~; C.~or1tra.ct IJeposit to P\trc.haser~~..:'1, ••'·', ·-••.·. ,. . , . . 1,• •,,· ,·.·.•, ,:),.~t:::.·I ....1,'"":11"•.·,,·-'"''.'. c_--.·,..··_.,•,".1 ',·.·.·,·,·.~.i.".".·',· ~..: ~....... ·.'1·.·1·.·,_.,..._ •.·.·••. ,.. ·, ,_,·, ,··.',~ ...... e.,··.',,~ _~ ·~· .... ' \·.:~,· "'·- . . '-·,·.·1,"'.-...' .,..·e._' ~"\ _, ~. : ·=--·... ~ ('..:-_\Lt\.:h ~· ......·~ ~......'S.:..t~._?' ~ : ~ '"" ,....... . ., ...~,.,_,~_t, , "'''"' ~--:.......... ,., - : ... ;_·.•,' ·'"- .'1. ............. ,....,_,.._·, t.\} __,_\.\Lt, . . . _., .,"_,· ·,·_, ,·,· ,··.·.. e.,··. <~_rf Se.ilcr sha] ~ be u.nable to t.r(l.t1sf(:r the iterns set fZF.rth 111 ~f2 . l [i . e . the Sha.res, L.ease:; l\~"3.r~H.H. 1ality·~, ~u--1d {tr1y Included Il'"ltf.:.rest~~ a~nd a11 otl1er iter11s in.eluded in tt1is sale] ir1 ac(:o.rda11ce: \:vith th.is C.~o.ntrac:t ~f{)r (~r1y· reaso.r1 other tha-11 Sell.e_('s .t~tih1re to .rnak·e n re(ruirefl paylrnent or otht~r vviHftd act or cnYnssior1~ ther1 s~-:11er shaH h~:rve tl1c right 1n adHJurn tht.: (:'.losing D:)r JJt..~riocls .r1ot exc.ceding 60 c-aiet1d.ar days in_ the ~~gg:ret;ate.~:: ~(lf s~:lh~~r clo~:s riot elect to a.c~icn1rr1 the (~Iosir1g or (if ac~iottr.r1rcl) o_n t.l1e ac~ic~l1rr1ed elate of (~'.losing SeU.f-.:r is sti [1 tn1abJe to perf()_rrn.'I tben u.n.less .Pl~.t\~.haser elect~~ to r)rocee::.i \~:1tt1 the C~losink~ ~.-~/ithout ejther Party, rna)r can.c.el this ·i Pa:n::.graph (C:ontrBtt 6.3 vvas rnodifled by tht~ C\;ntn::.c1 Rider to the ::~xtent th~::._t '~30 hu.s~ne~~r: days~~ v..:~is chang{':d to '~"30 days."~ il 34.) H.~der 3 of 19 [*FILED: 4] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 --~1r1 th.e f..:\.:t:n.t of suc.}1 cancel iat1or1~ tl}e sole Lh:~l)ility of Se11t.:.r s1-1aH the C.\}ntract I)t:J}Osit to ·be refttr1dcd to rs11rc:b.ast:.r a1H.i tc~ b~: to cau~H~~ .reirx1bursc r~1tri~:haser for tht: act.u.~~1 costs inc.urred t\Jr -~)uxc.h;:tse[rj·~s lien. and t.itlt~ searcI-1~ if H:n:/,)~ On February 26, 2015, the Co-op issued a letter to Zeitlin approving the proposed sale of the Unit to Engelbert, subject to certain conditions including, among others, that aH open pen11its and violations be closed and cleared and that proof be provided that there were "no liens, encumbrances, or adverse interests" filed against the Co~op as a result of work performed in the Unit. (Jt St., if~i 12, 33; Letter from Daniel Dermer [Co-op Managing Agent] to Zeitlin, dated Feb. 26, 2015 [IvkCracken A.fl, Ex. E].) The Co-op never gave unconditional approval to the proposed sale. (Jt. St,~] 13.) From February 2015 until at least February 2016, the parties, through their respective attorneys and brokers, continued to communicate in an atternpt to progress toward a closing. 3 The memoranda of law filed on this motion are refem;d to as Pl.'s Memo. In Supp., Dek' Memo, In Opp., Pl.'s Reply Memo., Def. 's Reply Memo., and .PL 's Sur-Reply Memo. 4 4 of 19 [*FILED: 5] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 (See e.g, Email from Blumenthal to Jacobus, dated Jtme 11, 2015 [McCracken AfI, Ex. GJ [providing an update on the status of the stop work order]; Email from Jacobus to Blumenthal, dated Feb< 12, 2016 [Mac Avoy AfI, Ex. J].) Engelbert sought updates fmm Zeitlin on the status of the Partial Stop \l,/ ork Order and the Eagle 9 policy and he and his attorney repe~tedly expressed impatience with the delays. (See ~~&Email from Ton1 Doyle (Def. 's Broker) to Blumenthal & Zeitlin, dated June 8, 2015 [McCracken Aff, Ex. JJ [copying an email sent from Engelbe1t to Doyle which expressed Engelbert's view that it was "getting ridiculous" that the "work stop order" was still in place]; Email from Jacobus to Blumenthal, dated June 3, 2015 [Mac Avoy Aff., Ex. CJ ["As I mentioned yesterday, [the Partial Stop Work Order] is still on record, weeks after we \Vere told everything was ok. [T]his is dragging on way too long"]; see also Ernail from Heyman (Def.'s Broker) to Zeitlin, Blumenthal, and Doyle, dated Mar, 6, 2015 [McCracken Aff, Ex.1] ["'Oscar desperate for[] an answer today"].) Zeitlin encountered "obstacles" in lifting the Partial Stop Work Order and satisfying the conditions to obtain the requisite Eagle 9 policy, (See Def 's :Memo. In Opp,, at 4, 9; ~-~~ Y.:£., Email from Blumenthal to Jacobus, dati.~d Aug, 21, 2015 [explaining challenges Zeitlin' s counsel encountered with certain UCC filings required by First American].) Zeitlin made periodic progress reports to Engelbert and offered projections of new closing dates. (See Def.' s lVIcmo. In Opp,, at 4; Engelbe1t AfI, ~ 16; see e.g. Email from Blumenthal to Jacobus, dated Nov. 9, 2015 [McCracken Aff., Ex. HJ [providing an update stating, among other things, that "Plan C" for resolving the issue with the Partial Stop V/ork Order had been "accomplished" and stating that 5 5 of 19 [*FILED: 6] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 the parties could "start considering a closing date tmvard the end of November or early in December [2015]''],) On January 25, 2016, Zeitiin's attorney sent an email to Engelbert's attorney acknowledging that the delays were Zeitlin' s fault and seeking confirmation that Engelbert was "still interested in this sale.'' (Email from Blumenthal to Jacobus [McCracken AfI, Ex. M].) In a February 12, 2016 email, Engelbert's counsel confirmed that Engelbert was "still interested in proceeding," but would "need a fe\v weeks from the time the stop work order has been lifted to closing" in order to "coordinate his funding." (Feb. 12, 2016 Email; see also Mar. 29, 2017 Engelbert Deposition Transcript, at 202~203 [Mac Avoy Aff., Ex. Z].) By notice dated March 9, 2016 (Cancellation Notice), however, Engelbert's counsel advised Zeitlin and his cotmsel that Engelbert elected to cancel the Contract. The Notice stated in the pertinent part: "Pursuant to the terms of the Contract and the conditions of the consent of 121 Greene Street Owners Corp. ('Cooperative') to the purchase of Mr. Engelbert of the Aprutment.s, the pending 'Partial Stop Work' order by the Nevv York City Department of Buildings involving the Apartments had to be removed as of record befbre any closing would be permittecL As of this date, no closing has occurred and the Partial Stop Work Order has not been removed as of recon.l "Pursuant to tbe terms of Paragraph 16 of the Contract, JVk Engelbert is electing to cancel the Contract. His contract deposit of $800,000, plus interest accmed should be immediately returned to him. Please forward the return of the deposit to my attention." (Cancellation Notice [McCracken Aff., Ex. N]; see Jt. St.,~~ 23, 51.) 6 6 of 19 [*FILED: 7] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 The Partial Stop \Vork Order was lifted by the Department of Buildings on or about March 15, 2016. (Jt St.,] 67.) Notwithstanding the March 9, 2016 cancellation, Engelbert attempted to negotiate with Zeitlin about the sale ofthe Unit, offering to close if a concession were made in the purchase price and if the closing were adjourned approximately six months. (Email from Blumenthal to Jacobus, dated Mar. 21, 2016 [Mac Avoy Aff., Ex. OJ [summarizing Engelbert's offer]; Email from Karen Heyman (Def.'s Broker) to Blumenthal, Zeitlin, & Doyle, dated Apr. 22, 2016, forwarding an email fromNaim Mokadmini (PL's Broker) of the same date [Mac Avoy AJf., Ex. SJ.) Zeitlin rejected these offers. (Mar. 21, 2016 Email; see Email from Blumenthal to Jacobus, dated Apr. 24, 2016 [JVIac Avoy Aff,, Ex. T].) Zeitlin purported to serve a time of the essence notice, dated March 21, 2016, which stated: "All issues concerning title to tbe referenced premises have been resolved completely .... Therefr)re, please consider this letter a 'time of the essence' notice advising you that the dosing V'.rill take place 1vfrmday, April 25, 2016 .... " (Notice [Mac Avoy Aff,, Ex. OJ.) By email dated April 21, 2016, Engelbert's com1sel notified Zeitiin's counsel that Engelbert's position was that the Contract was cancelled, that he was entitled to the refund of the deposit, and that he would not appear at the dosing. (Mac Avoy Aff., Ex. P.) Neither Engelbert nor Zeitlin appeared at the April 2.5 closing. (Jt. SL,~ 27.) The $825,000 deposit has not been returned to Engelbert or paid to Zeitlin and is being held by the Court in escrow pending the resolution of this litigation. (Id., ~i~] 6, 24; Stipulation, so-ordered on l'vlar. 8, 2017 fNYSCEF Doc. No. 35].) 7 7 of 19 [*FILED: 8] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 12-!scussiou The standards for summary judgment are well settled. The movant must tender evidence, by proof in admissible form, to establish the cause of action "sufficiently to \varrant the court as a matter oflaw in directing judgment." (CPLR 3212[b]; Z1w¥&nn@_y_,___C_i.ty_gf.N~\:>y~__ Y~n~!~, 49 N.Y.2d 557, 562 [1980].) "Failure to make such showing requires denial of the motion, regardless of the sufficiency of the opposing papers." OVln~r~;rgg_.v,.. N~lY.~YmkJlnh~:,JYfa~fL~1r,, 64 N.Y2d 851, 853 [1985].) Once such proof has been offered, to defeat summary judgment "the opposing party must show facts sufficient to require a trial of any issue of fact' (CPLR 3212, subd [b])." (Z_w;k~m:mn, 49 N.Y2d at 562,) The complaint pleads a first cause of action for a declaration that Zeitlin breached the Contract (Comp!., 1~ 42-46); a second for injunctive relief (id.,,~ 47-49); and a third for breach of the Contract (id., 4!41! 50-55). The second amended answer pleads a first counterclaim for breach of contract (Second Am. Answer, ~'f 123-141); a second for breach of the implied covenant of good faith and fair dealing (i.~L Engelbert breached the Contract (id., f'TI 142-149); and a third for a declaration that irir 150-155), The three causes of action pleaded in the complaint are all based on the allegation that Zeitlin breached the Contract by failing to remove all violations to work done in the unit prior to dosing, failing to satisfy the conditions for issuance of a required insurance policy, and failing to dose no later than Fehmary 14, 2015. (Compl., ,:iI 43, 53.) l~ng~lki_Y._rt_'._~JYl91ign The court first addresses the parties' arguments concerning Engelbert's cancellation pursuant to Paragraph 162 of the Contract. The court holds that, upon the passage of the 8 8 of 19 [*FILED: 9] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 adjourned closing date, the right to cancel the Contact immediately vested in each party. It is well settled that in a real estate sales agreement, "time of performance is not normally of the essence unless the contract so states or one of the parties has unequivocally declared it upon Nappa, 46 NY2d 560, 565 f1979], rearg denied 47 NY2d 952.) It is also well settled, however, that where the agreement expressly grants the purchaser and/or the sell.er the right to cancel after NY2d 157 [1990]; ~~-~ B.mn0n_y_Btr~J!IIY, 68 AD3d 1036, 1037 f2d Dept 2009]; I@m~l::1~g1Ii!I~~-_y )Y1l'll1~m, 2010 NY Slip Op 50894 [U], 2010 WL 2012060, * 3-4 [Sup Ct, NY County 2010]; Sgg@_gg v KilJ~IAfill~JU, 2009 NY Slip Op 31057 [U], 2009 WL 1401187, * 5 [Sup Ct, NY County 2009] [holding that, although time was not of the essence, buyer "was folly within her contractual rights to cancel the proposed purchase" when the board failed to give its unconditional approval].) Here, paragraph 16.2 of the Contract provided that, in the event Zeitlin was unable to "perform" on the adjourned date, unless Engelbert elected "to proceed \Nith the Closing without abatement of the Purchase Price," both parties had an unequivocal right to "cancel th[e] Contract on Notice to the other Party given at any time thereafter.'' 4 lt is undisputed that Zeitlin was unable to perform under the terms of the Contract on that date. (S.~-~ Def.'s Memo. In Opp., at 34; Jt. St, 111; Dec. 21, 2017 Oral Argmnent Tr., at 24-25.) The absence ofa time of the essence clause therefore did not preclude Engelbert tJ:·om canceling the Contract after the adjourned date. 4 Notice is defined as follows: "Any notice or demand ('Notice') shall be in iwiting and delivered either by hand, overnight delivery or certified or registered mail, return receipt requested, to the Patty and simultaneously, in like manner, to such Party's Attorney, if any, and to Escrowee at their respective addresses or such other address as shall hereafter be designated by notice given pursuant to this ~I 7." (Contract, ~ J 7. l .) 9 9 of 19 [*FILED: 10] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 The court rejects Zdtlin's argument that the cancellation clause is "ineffective" because "Engelbei1 'eiect[ed] to proceed' with the closing on the Contract after the original dosing date passed." (Def's Memo. In Opp., at 12 [brackets in original]; see also id., at 2, 11, 13-14.) The court must "construe the [contract] so as to give full meaning and effect to the material provisions. A reading of the contract should not render any portion meaningless. Fmther, a contract should be read as a whole, and every part will be interpreted with reforence to the whole; and if possible it will be so interpreted as to give effect to its general purpose!' (B.\':'.!1l S_f!Y_·---~-~'!I!lL\':__S.Qillfil!?X, 8 NY3d 318, 324-25 [2007] [internal quotation marks and citations omitted]; )Y_,Yf._,_W. AsSQf§:,, 77 NY2d at 162 [reading the contract "as a whole to detennine its purpose and intent"],) Paragraph 16.2 must be read together with paragraph 16.1, as modified by paragraph 34 of the Contract Rider, These provisions afforded Zeitlin the "right to adjourn the Closing" only for a period not exceeding 30 days. Read in light of paragraph 16.1, paragraph 162 gave Engelbert the right to elect to proceed \.Vith the Closing on the adjourned date "without abatement of the Purchase Price" in the event that Zeitlin failed to comply with the terms of the Contract. 5 As Engelbert did not elect to close on that date, paragraph 16.2 gave either party the right to cancel at any time thereafter. The court reaches a different result as to the issue of waiver and estoppeL It is well settled that "[c]ontractual rights may be waived if they are kno'.vingly, voluntaxily and intentionally abandoned. Such abandonment may be established by afrim1ative conduct or by fa.ilure to act so as to evince an intent not to claim a purported advantage," (f_ltrl_df!m<::I_lki:l 5 To the extent that sim llar contract language was interpreted differently by a court on a motion for a preliminary injunction (Q~tltxJr:Us;~]L 2012 NY Slip Op 32!00 [U], 2012 WL 3449439 [Sup Ct, NY County 2012]), the court disagrees '\vith that interpretation. 10 10 of 19 [*FILED: 11] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 quotation marks and citations omitted].) Estoppel "is imposed by law in the interest of fairness to prevent the enforcement of rights which would work fraud or injustice upon the person against v.,rhom enforcement is sought and who, in justifiable reliance upon the opposing party's words or conduct, has been misled into acting upon the belief that such enforcement would not be sought" (Id,, at 106.) It is also well settled that "no oral modification" and "no-\vaiver" provisions may themselves be waived, (See generallv ;&9,~~Y"~l~~J~~@JtyJ\§,§Pf<~,,, 42 NY2d 338, 343 [1977]; fa~l:im1f~Lv Tit\, kg, 65 AD3d 620, 620 [2d Dept 2009].) Further, under the doctrine of equitable estoppel, "[ o]nee a party to a \:YTitten agreement has induced another's significant and substantial reliance upon an oral modification, the first party may be estopped _from invoking the statute [of frauds] to bar proof of that oral modification." (Rose, 42 NY2d at 344.) Engelbert relies on authority which holds that the right of a pm-chaser to a real estate contract to exercise its option to cancel is not waived or forfeited by the fact that the party "took certain steps towards closing on the contract" after the date by which the other party was required to perform. (S-1,'.~ 1}9_ng_H:~:_tmJ,,j~1LY_Qg_U~rJ:'.l\l~~"CrnJL, 192 AD2d 634, 634 [2d Dept 1993 J [holding that buyers were entitled to return of their down payment \Vhere buyers cancelled the contract after the date by which seller was required to perfrwm]; accon~ JJP.Q __ Q_<;.~c:m§ifJ~, 1!J;;:"yJ~,AI?..I~rrning_l __CPU2, 14 AD3d 472, 474 [2d Dept 2005], lY deni_~g 5 NY3d 783 (same]; see generally Qd_~~~9..l~t_Sr_~_i;;igl__\:m:~__9fN~E-Ym:!i,Jn£,"YJ~,K~,rnt)_y~.J:h1rn-1,'.§.. J:l.Pmf;..Gf:l:r~., .. J;rw,, AD3d 962, 963 [2d Dept 2009]; Eng!finSLYJ:·;I£1t~3ll~_im, 66 222 AD2d 825, 827 (3d Dept 1995].) There is, however, also substantial authc1rity that \Vhere a party discusses the _possibility of new dosing dates, grants an indeterminate extension of time to perfonn, engages in additional 11 11 of 19 [*FILED: 12] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 performance, or otherwise leads the other party to believe he or she is willing to proceed in disregard of the original date, the party may waive its right to cancel the contract. (See S~~Jilrr~Jli Y.Yi.t~l.<,<, 223 AD2d 361, 362 [1st Dept I 996] [holding, after trial, that a tirne of the essence provision ''was waived by the statement of defendant[] [buyers'] attorney in response to plaintiff<>' attorney's letter. " , that plaintiffs should '[c]lean up violations so that we can proceed to a closing------or give up-retum monies in escrow'"]; I_s_l_@ml__ B:f>_l[;lt_<,<_s__Mgt,_,__l_n(;_,__y__M~A.: )\{~p_9_1Ji,~w~ILJ,J:,cQ, 66 AD3d 839, 840 [2d Dept 2009] [holding that, although the contract afforded the seller the right to cancel in the event the buyer could not obtain a subdivision approval, issues of fact existed as to whether the seller had "waived performance within the time period originally fixed and essentially granted the plaintiff an indeterminate extension of time"]; ~~h2HlLYJ~,i£:J~.A~.~Q£f>. _,Jm~,, 15 AD3d 540, 541 [2d Dept 2005] [holding that questions of fact existed as to whether the defendants waived their right to cancel where they asked plaintiffs to schedule a "mutually agreeable closing date" approximately three months after the original closing date and did not purport. to cancel until seven months after the original closing]; _s_~g ?.:t~Q EL:A4..2.~_Q __W_'._J,c1:C_y_;mJJ11!?.~xtStJJ:'.~;., 67 AD3d 520, 521 [1st Dept 2009] ["We note also that by continuing to perform under the agreement \Vithout giving plaintiff [seller] notice of alleged defaults, defendant [buyer] could not thereafter elect to tem1inate the agreement for a default which apparently it chose to disregard as a ground for termination of the contract"] [internal quotation marks and citations omitted]; .f>.I,'.~ generally p_g_.naj~i_y __B_~X.P.<JtQ, 27 AD3d 414, 414 [2d Dept 2006] [holding that, while the defendants made a prima facie showing of entitlement to judgment based on a cancellation provision in the contract of sale, the plaintiff raised triable issues of fact as to whether there was partial perfonnance of an oral modification and therefore 12 of 19 [*FILED: 13] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 whether the defendants waived or were estopped from exercising their right to cancel the contract],) If such a \Vaiver has occurred, a party \Vho wishes to reinstate its right to cancel must "set a new date for closing and make time of the essence by giving clear, distinct, and unequivocal notice to that effect giving the other party a reasonable time in which to act. , .. " (MQt~Y..Y QE_A_Q,Jn£~., 305 AD2d 472, 472 [2cl Dept 2003] [internal quotation marks and citations omitted]; see ~iiY~__yJ~Qllm:, 296 AD2d 370, 371 [2d Dept 2002].) Triable issues of fact exist as to whether Engelbert, through his statements and conduct after the adjourned closing date, waived or is estopped from relying on his right to cancel under the Contract without first setting a deadline for Zeitlin to perform. In emails submitted in suppo1i of both Engelbert's motion and Zeitlin's cross-motion, the parties, through their counsel, repeatedly discussed rescheduling of a closing date after the Partial Stop Work Order was lifted. Although early on in the counsels' discussions, Engelbert's counsel stated that she would obtain "tentative dates" for a closing frorn Engelbert (Email from Jacobus to Blumenthal, dated l\ilay 12, 2015 [Mac Avoy AfI, Ex. H1), there is no evidence in the record that a subsequent date was ever set In fact, in later months, Engelbert's counsel refused to discuss a closing date until the Partial Stop \Vork Order was Lifted. (S~~ ~,_g, Email from Ja.cobus to Blumenthal, dated Nov. 10, 2015 ["Once that issue [i.e., the Partial Stop Work Order] has been resolved we can discuss a closing date"] [Mac Avoy AfI, Ex. I]; Email from Jacobus to Blumenthal, dated Jan. 25, 2016 [McCracken Af[, Ex. M].) In emails to Zeitlin's brokers or counsel, Engelbert and his counsel also repeatedly expressed Engelbert's frustration over the delays in lifting the Partial Stop Work Order. (See Emails discussed ,'?_gpra at 5.) Zeitlin, however, submits evidence that as late as 13 13 of 19 [*FILED: 14] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 which must be detennined at trial. 6 In holding that a triable issue of fact exists, the court rejects Engelbert's argument that his discussions with Zeitlin after sending the Cancel!ation Notice were not conducted in furtherance of the Contract and that "[a]ny agreement that Engelbert and Zeitlin may have made, . , would have constituted a ne•v contract, not the Contract that Engelbert tem1inated on March 9, 2016." (See PL's Reply Merno., at 22.) The evidence in the record of these rnotions does not support the claim that the parties were negotiating a new contract, as opposed to discussing belated performance of the existing Contract ((QJ11Jl<'li\'; Ki~t<,';J<':!_Y__,'\J1_l~~i:~, 22 AD3d 641, 643 [2d Dept 2005].) 6 As discussed above (supra, at &- J 0), the Contract permitted the seller to adjourn the closing date for 30 days after the original closing date (i.e., until February 14, 2015) if Zeitlin was unable to perfonn on the original closing date. (Contract,~[ 16.1; Contract Rider, '1"[ 40.) The Contract also provided tbat "[t}he Attorneys may extend in \Witing any of the time limitations stated in this Contract." (Contract, '1"[ 14.2.) A January 16, 2015 email from Zeitlin's counsel to Engelbert's counsel refers to an agreement by the pmtfos to adjourn the closing "pending the Board's decision!' (Mac Avoy Aff., Ex. G.) The parties have not addressed the significance of this email and its impact on Engelbert's rig!Jt to cancel the contract. 14 14 of 19 [*FILED: 15] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 The court also rejects Engelbert's contention that, "(b]ecause Engelbert never signed any waiver of his right to cancel the Contract, any such purported waiver is unenforceable,'' (PL 's Reply Memo., at 17.) On the authority cited above (supra, at 11), this argument is without merit Engelheii also claims a separate right to cancel the Contract pursuant to paragraph 6.3. 7 Zeitlin argues that "paragraph 6.3 is inapplicable because the Corporation had, in fact, made a 'decision' on Engelbert's application[] on February 26, 2015, [when] the Corporation gave approval of the sale of the Unit to Engelbe1i, subject to resolving any liens or violations on the Unit and lifting the Stop Work Order." (Def's Reply Merno., at 7 [emphasis omitted].) The plain language of the Contract stated that "[tJhis sa.le is subject to the unconditional consent of the Corporation." (Contract, ii 6, l ,) Contrary to Zeitlin's contention, the board's conditional approval therefore does not render paragraph 6.3 of the Contract inapplicable. (See generally l&Yi<l{tQ~.YJ;Ii!rn'ltz, 60 AD3d 579, 579-580 [1st Dept 2009], lv denied 12 NY3d 714,) The comi holds, however, that Engelbert is estopped from" asseiiing its right to caned pursuant to paragraph 6.3 of the Contract The Cancellation Notice by its tem1s stated that Enge.lbert elected to cancel the Contract, pm·suant to paragraph 16, based on Zeitlin' s failure to remove the Partial Stop Work Order. There is persuasive authority that "where a party to a contract terminates the contract and presents a specific reason for the termination, that party is estopped from raising a difforent reason upon the commencement of an action." (See e.g. 1992] [holding, under New York law, that the defendant employer was estopped from arguing 7 Parag,wph 6.3 of the Contract is not raised in the complaint, which pleads that "Purchaser [Engelbert] issued a notice of termination pursuant to Paragraph 16.2 of the Contract" (CornpL, ir 32.) In his Reply to the Counterclaims, Engelbert pleads fifth and sixth affirmative defenses that he had a right, among others, to cancel the Contract on Zeitlin's failure to secure the Co-op's unconditional assent to the sale. (Pl. 's Reply to Counterclaims, at 12-13.) 15 15 of 19 [*FILED: 16] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 that a severance agreement was "void for lack of consideration or unconscionability" vvhere "the only stated reason" for discontinuing severance payments under the agreement was the defondant's "severe financial problems"], citing Li_t_tki_Q_hiLY_Sh<'!cW, 159 NY 188, 191 [18991 [holding that the defendant buyers could not raise a new reason for rejecting goods sold by the plaintiffs where the defendants' rejection letter stated two specific grounds, the court reasoning that "jf a particular objection is taken to the pei;formance and the party is silent as to all others, they are deemed to be waived"].) The appellate authority cited by Engelbert is not to the contrary, as it does not address whether a party may seek to justif}' a termination of a contract on a ground not stated in the te1111ination or cancellation. (Se_~ ~g,_ Ar:bqrJA;_~t~hHLJJ~G.Y ~IMII Capital Com,_, 68 AD3d 580 [1st Dept 2009]; ~J~~:Z __ R~_<ll~y__G_Q,,,_LLG.Y}Qn~,?, 52 AD3d 272, 272 fl st Dept 2008]; Ji<'.iK~LYJZ~S?IrrlW.\ 226 AD2d 301, 304 [1996].) In summary, the court holds that Engelbert has not demonstrated that he is entitled to judgment as a matter of law on his second cause of action for injunctive relief directing the release to him of his Contract Deposit. He has also not demonstrated that he is entitled to judgment as a matter of law on his third cause of action for breach of contract, alleging that Engelbert validly cancelled the Contract as a result of Zeitlin's breaches in failing to rernove violations and to obtain a title insurance policy and, therefore, in fa.fling to close by February 14, 2015. (CmnpL, ~il 25, 53,) The first cause of action for declaratory relief should be dismissed as duplicative of the second and third causes of action. Z-YWin~.§..~m.§.~:N!Q!im1 The fa.ctual issues outlined above also preclude summary judgment in favor of Zeitlin on his counterclaims. Fmiher, a question exists as to \.Vhether Zeitlin was ready, willing, and able to 16 16 of 19 [*FILED: 17] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 perform on his proposed closing date. Although Zeitlin's counsel, Andrew Bluxnenthai, testified that he believed that Zeitlin would have been able to dose on April 25, 2016 (May 2, 2017 Deposition Tr., at 114-115 [Mac Avoy AfI, Ex. Y]), he also testified that he had not, among other things, advised the managing agent that there was a closing schedule (id., at 115), required that the managing agent issue a letter confirming that all payments in arrears had been paid (id., at 117), or requested that First American "send a closer prepared to write a title policy" (id., at 119-120), Contrary to Zeitlin's contention (Def's J:V1emo. In Opp., at 24), Engeibe1t's alleged anticipatory repudiation of his obligations did not excuse Zeitlin from showing that he was ready, willing, and able to close. (See Yl';'.~m.Y.. Yrnnf!.JJey,__QIQ.YJ\Jn(,',_, 18 NY3d 527, 530, 532 [2012] [holding that "in a case alleging that a seller has repudiated a contract to sell real property, the buyers must prove they were ready, vvilling and able to close the transact.ion"].) Zeitlin has thus not demonstrated that he is entitled to judgment as a matter of law on his first counterclaim, alleging that Engelbert, not he, breached the Contract The second counterclaim fix breach of the implied covenant of good Jaith and fair dealing and the third counterclaim for a declara1ory judgment will be dismissed as duplicative of the first counterclaim. Attornev's Fees .......................•.................. . Finally, the court holds that even if Engelbert ultimately prevails in this action, he will not be eutit!ed to attorney's foes. Paragraph 132 of the Contract stated in the pertinent part: "Subject to the provisions of~ 4.3, each Party indemnifies and holds harmless the other against and from any claim, judgment, loss, liability, cost or expense resulting from the indemnitor's breach of any of its representations or covenants stated to survive Closing, cancellation or 17 17 of 19 [*FILED: 18] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 tem1ination of this Contract. ... This ~13.3 [sic] shall survive Closing, cancellation or termination of this Contract" Engelbert points to no representation or covenant that could be a possible basis for indemnification under this provision. Engelbert claims that he is entitled to indemnification based on Zeitlin's failure to return the Contract Deposit to him, pursuant to paragraph 27 of the Contract (PL's l\/lemo. In Supp., at 24-25; Pl.'s Reply Memo., at 23.) Paragraph 27 did not contain any representation or covenant regarding the Contract Deposit but, rather, set forth the obligations of the Escrowee with respect to the Contract Deposit and provided for indemnification of the Escrmvee against claims in c01111ection with the perforrnance of the Escrowee's acts or omissions, other than those involving specified misconduct. Paragraph 4 of the Contract set fixth representations that the shares shall be free and clear of liens and that "no violations shall be of record .... " (Contract, ir14.L9.2, 4.l.9S) Engelbert does not rely on these representations. But, in any event, paragraph 4.3 further provided that the representations and covenants in paragraph 4 "shall be true and complete at Closing .... " As no dosing ever occurred, there is no claim for a breach of those representations and warranties. It is accordingly hereby ORDERED that the motion of plaintiff Oscar Engelbert for summary judgment is denied, except to the extent of dismissing defendant Jide Zeitlin' s second counterclaim for breach of the implied covenant of good faith and fair dealing and third co1mterclairn fi-;r a declaratory judgment; and it is further ORDERED that the cross~motion of defendant Jide Zeitlin is denied, except to the exttmt of disrnissing the first cause of action of the complaint for a declaratory judgment; and it is further 18 18 of 19 [*FILED: 19] NEW YORK COUNTY CLERK 10/22/2018 09:31 AM NYSCEF DOC. NO. 159 INDEX NO. 653189/2016 RECEIVED NYSCEF: 10/22/2018 ORDERED that the second cause of action of the complaint for injunctive relief and the third cause of action for breach of contract are severed and shall continue; and it is further ORDERED that the first counterclairn for breach of contract is severed and shall continue; and it is further ORDERED that Engelbert's application for attorney's fees is denied; and it is further ORDERED that the parties shall appear fix a pre-trial conference on December 13, 2018 at 2:30 p.m. This constitutes the decision and order of the court. ....•'""") ~'JJ.·::l~~~,~==MARCY'$·. I<'RlHDMAN, J.S.C CHECK ONE: APPUCATION: CHECK IF APPROPRIATE: r·····i LJ l. . ) CASE DISPOSED GRANTED D r~ DENIED i71 ~ l SETTLE ORDER L....J INCLUDES TRANSFER!REASSIGN ; ri \.,,-. ...............: 19 19 of 19 NON-FINAL DISi'OSJTlON GRANTED IN E'Ai<T SUBM!T ORIH:R FmVC!ARY Al'l'mNTMF.NT D D OTHER REFERENCE

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