3737 Junc. Blvd., LLC v Pretty Girl, Inc.

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[*1] 3737 Junc. Blvd., LLC v Pretty Girl, Inc. 2018 NY Slip Op 51679(U) Decided on November 27, 2018 Supreme Court, New York County St. George, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 November 27, 2018
Supreme Court, New York County

3737 Junction Boulevard, LLC, Plaintiff,

against

Pretty Girl, Inc. and ALBERT NIGRI, Defendants.



656566/2017



FOR PLAINTIFF/MOVANT:

Kim H. Ly, Esq.

1185 Sixth Avenue, 10th Floor,

NEW YORK, NY 10036

FOR DEFENDANT:

Sanford P. Rosen

ROSEN & ASSOCIATES, P.C.

747 3RD AVE, NEW YORK, NY 10017
Carmen Victoria St. George, J.

Around October 25, 2017, plaintiff brought this action against defendants — against Pretty Girl, Inc. (Pretty Girl) in its capacity as lessee and guarantor of a lease upon which the lessee defaulted, and against Pretty Girl's president, Albert Nigri, as co-guarantor. The lease was set to expire in 2021. The lessee, Pretty Girl, Inc. (Pretty Girl), is in bankruptcy, and therefore plaintiff has discontinued against it. Currently, plaintiff seeks summary judgment against Mr. Nigri on all three causes of action. For the reasons below the Court denies the motion.

Pursuant to the guarantee, which was executed on January 1, 2012, Mr. Nigri agreed to pay any rent owed when Pretty Girl surrendered the premises. Moreover, plaintiff contends, Pretty Girl did not give the requisite surrender notice, and therefore under the guarantee Mr. Nigri owes additional rent for the 90 days after the tenant vacated. The monthly base rent was $20,085.00. Plaintiff commenced a non-payment proceeding upon Pretty Girl's default, and on December 19, 2013, plaintiff was awarded $29,250.00 for October through December 2012, due to a 50% rent abatement for those months. In addition, plaintiff was awarded possession of the premises and a money judgment of $230,100.00 for the period from January through October 2013.

Ultimately, when Pretty Girl did not pay this amount, plaintiff evicted Pretty Girl on March 5, 2014. Plaintiff commenced this lawsuit to recover all the money allegedly due to it. [*2]The first cause of action seeks rent due through December 31, 2014, purportedly totaling $314,617.73. The second cause of action, for $5,898.57 (which represents the $4,000 fine plus interest) stemming from an Environmental Control Board violation the tenant incurred during the tenancy. Finally, as the third cause of action, plaintiff seeks attorney's fees of "not less than $100,000" (Ly Aff in Support, ¶ 31).[FN1]

Currently, plaintiff moves for summary judgment on all three causes of action. In support, it submits the affirmation of counsel and the affidavit of Estralda Tudor-Davis, who collected the rent for plaintiff's management company. It also includes copies of pertinent documents, including the deed, the lease, the guarantee, a copy of the December 19, 2013 order awarding plaintiff $230,100.00, and a printout of the rent records.

Mr. Nigri opposes the motion. He argues that the signature of the tenant on the lease looks nothing like the signatures on the guarantee, and he notes that the guarantee and lease were signed on different dates. The signatures on the guarantee, he contends, are forged. He cites Kitovas v Megaris (133 AD3d 720 [2nd Dept 2015]) to support his argument that his assertion of forgery, coupled with documents showing differences in the signatures, are sufficient to raise an issue of fact regarding the authenticity of the guarantee (see also Goldberger v Magid, 133 AD3d 546, 546 [1st Dept 2015]). At any rate, he argues, the guarantee is unenforceable because he received no consideration in exchange for the guarantee; he alleges that the lease did not constitute consideration because the lease was executed around five weeks before the guarantee. He states that the affidavit of Ms. Tudor-Davis lacks evidentiary value because she states that she served as rent collector but does not establish that the business records exception to the hearsay rule applies.

Next, Mr. Nigri states that because of plaintiff's decision to discontinue against Pretty Girl, Inc., Mr. Nigri also is released from liability (citing In re Halstead Energy Corp., 367 F3 110, 115 [2nd Cir 2004]). Under General Obligations Law (GOL) § 15-104, he notes, the release of one oblige in the absence of an express reservation of rights against him, GOL § 15-105 governs. That statute provides that if plaintiff had reason to know that Pretty Girl did not pay the amount it was obliged to pay, then "the obligee's claim against that co-obligor shall be satisfied to the amount which the oblige knew or had reason to know that the released or discharged obligor was bound to such co-obligor to pay" (id.). Mr. Nigri argues that there is an issue of fact on this point, making summary judgment improper.

Finally, Mr. Nigri states that the guarantee did not extend to Pretty Girl's indemnification obligations, and therefore the third cause of action for legal fees and additional rent lacks merit. The Court rejects this last position without further discussion, as the guarantee expressly states that Mr. Nigri is liable for "real estate taxes, utilities, payment of fines, penalties, liens and violations . . . and all modifications and exten[s]ions" and that he also "agree[d] to pay [plaintiff's] expenses, including . . . attorney's fees" (Guarantee, NYSCEF Doc. No. 31). The Court also rejects Mr. Nigri's argument that legal fees would only be compensable under the guarantee if the 2011 lease had not expired, and that plaintiff somehow waived its right to bring this action by filing the complaint 4 ¾ years after the default. The Court notes that plaintiff's eviction proceeding against Pretty Girl was final in March 2014, 2 ½ years before plaintiff [*3]commenced this lawsuit.

In reply, plaintiff states that Mr. Nigri's signature on the guarantee is the same as that on his driver's license, which is annexed to the guarantee, and that Mr. Nigri was required to produce testimony from a handwriting expert to support his claim of forgery. As for consideration, plaintiff points out that the guarantee expressly states the guarantee was executed "[a]s consideration for the execution and delivery of this lease" (Guarantee, NYSCEF Doc. No. 31). It is of no import, plaintiff states, that the guarantee was executed several weeks later, especially as the parties' negotiations, via emails which plaintiff annexes, specifically mention the importance of the guarantee. Plaintiff notes that Ms. Davis had sufficient knowledge of the rent collection practices to speak to defendants' debt, and states that if any issues remain regarding the computations or the amount of the debt, they can be resolved at a hearing. Plaintiff challenges Mr. Nigri's argument that plaintiff waived its right to pursue this lawsuit against him by discontinuing against Pretty Girl, noting that the discontinuance effectively preserved plaintiff's rights against Mr. Nigri by indicating that it was against Pretty Girl only and was without prejudice.[FN2]

DISCUSSION

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The standard for granting summary judgment is not in dispute. "[T]he moving party has the initial burden of establishing its entitlement to judgment as a matter of law with evidence sufficient to eliminate any material issue of fact" (Schmidt v One New York Plaza (153 AD3d 427, 428 [1st Dept 2017] [quoting Alvarez v Prospect Hosp., 68 NY2d 320, 324 (1985)]). The Court considers the facts "in the light most favorable to the non-moving party" (Ortiz v Varsity Holdings, LLC, 18 NY3d 335, 339 [2011]). The Court denies summary judgment if any triable issue of fact exists (Schmidt, 153 AD3d at 428 [citing Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 (1985)]).

After careful consideration, the Court denies plaintiff's motion. This Court finds that plaintiff has set forth a prima facie case.[FN3] However, in opposition defendant has raised a triable issue. In particular, the differences between Mr. Nigri's signatures on the lease and on the guarantee, along with Mr. Nigri's affidavit stating that the guarantee was forged, are sufficient to raise a triable issue of fact as to the authenticity of the guarantee (Kitovas, 133 AD3d at 721). Contrary to plaintiff's argument, "an expert opinion is not required to raise a triable issue of fact regarding a forgery allegation" (id. at 722). As the authenticity of the guarantee is an essential component of plaintiff's case, summary judgment is not appropriate. The Court has considered all the parties' other arguments and they do not alter the decision.

Accordingly, it is

ORDERED that the motion is denied.



Dated: November 27, 2018

ENTER:

____________________________________

CARMEN VICTORIA ST. GEORGE, J.S.C.

Footnotes

Footnote 1: Plaintiff alleges that defendants owe $2,056,534.49, which includes all rent and additional charges until the lease's expiration date but it does not seek this amount in the complaint or this motion.

Footnote 2: The Court agrees that Mr. Nigri's arguments relating to the RJI have no merit.

Footnote 3: In addition to those discussed, the Court agrees with plaintiff that there was consideration for the guarantee.