Audthan LLC v Nick & Duke, LLC

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Audthan LLC v Nick & Duke, LLC 2020 NY Slip Op 33057(U) September 15, 2020 Supreme Court, New York County Docket Number: 652050/2015 Judge: Robert R. Reed 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 09/16/2020 11:57 AM NYSCEF DOC. NO. 903 INDEX NO. 652050/2015 RECEIVED NYSCEF: 09/16/2020 SUPREME COURT OF THE STATE OF NEW YORK NEW YORK COUNTY PRESENT: HON. ROBERT R. REED _;;.,;;,.;;;;...;..;;.;;...;;..;;..;;;;...;;;.=----~..;..;;;;~~~~~~~~ PART 43 Justice ----------------------------------------------------------------------------X AUDTHAN LLC, INDEX NO. MOTION DATE Plaintiff, MOTION SEQ. NO. 652050/2015 08/27/2020 020 -vDECISION + ORDER ON MOTION NICK & DUKE, LLC, Defendant. ---------------------------------------------------------------------------X by NYSCEF document number (Motion 020) 864, 865, 866, 867, 868,869, 870,871,872, 873,874, 875,876,877,878,879,880,881,882,883, 884,885,886,887,888, 889 The following e-filed documents, listed were read on this motion to VACATE/STRIKE - NOTE OF ISSUE/JURY ROBERT R. REED, J.: This dispute arises out of a long-term ground lease (Lease) between plaintiff Audthan LLC (Audthan), as lessee, and defendant Nick & Duke, LLC (Landlord), as lessor, for the property located at 182-188 Eleventh Avenue, New York, New York. In motion sequence no. 20, Landlord moves, pursuant to Uniform Rules for Trial Courts (22 NYCRR) § 202.21 (e), for an order vacating the note of issue and certificate of readiness served by Audthan on July 24, 2020. Landlord argues that the case is not ready for trial because one week after filing the note of issue, Audthan moved by order to show cause for, inter alia, a Yellowstone injunction, and leave to serve a second amended complaint (NY St Cts Elec Filing [NYSCEF] Doc No. 875, Bradley S. Silverbush [Silverbush] affirmation, exhibit J at 1-2). Landlord submits that Audthan's motion stems from an earlier motion Audthan brought, also by order to show cause, for a fourth Yellowstone injunction related to a Notice of Termination dated February 14, 2020 (the NOT) (NYSCEF Doc No. 878, Silverbush affirmation, exhibit M at 1-2). The NOT had alleged that 652050/2015 AUDTHAN LLC vs. NICK & DUKE, LLC Motion No. 020 Page 1of5 1 of 5 [*FILED: 2] NEW YORK COUNTY CLERK 09/16/2020 11:57 AM NYSCEF DOC. NO. 903 INDEX NO. 652050/2015 RECEIVED NYSCEF: 09/16/2020 Audthan failed to provide proof of insurance coverage in accordance with Articles 5 and 11 of the Lease (NYSCEFDoc No. 873, Silverbush] affirmation, exhibit Hat 10-11). Landlord argued that the application was defective in the absence of allegations in the complaint challenging the validity of the purported violations in the NOT (NYSCEF Doc No. 879, Silverbush affirmation, exhibit N, ~~ 11-24). This court agreed and denied the motion, but granted Audthan a 30-day extension of the temporary restraining order staying the termination of the Lease to allow it time to refile the application for a Yellowstone injunction and to seek leave to amend its complaint (NYSCEF Doc No. 873 at 13 ). Audthan has since moved for relief within the time prescribed by this court's order (NYSCEF Doc Nos. 875, Silverbush affirmation, exhibit Kat 1). On this motion, Landlord asserts that Audthan unnecessarily delayed seeking leave to amend its complaint until after this court rendered its decision on the prior motion. Furthermore, when Audthan filed its motion to amend, it had already served and filed a note of issue certifying that discovery was complete. Landlord posits that there has been no discovery related to Audthan' s compliance with the insurance provisions in the Lease because the issue was not pied in the complaint. It submits that the note of issue should be vacated to permit discovery on this issue to proceed. Audthan opposes the motion on the ground that Landlord has not identified what discovery is outstanding, and that Landlord has been delinquent since it has not served any discovery demands on the insurance issue. Audthan also argues that discovery is not always required when there is a pleading amendment. In any event, Audthan submits that Landlord has already received discovery on the issue, having served a subpoena upon Audthan's insurance broker for copies of Audthan's insurance policies (NYSCEF Doc No. 885, Silverbush affirmation, exhibit D at 1-3). Page 2of 5 652050/2015 AUDTHAN LLC vs. NICK & DUKE, LLC Motion No. 020 2 of 5 [*FILED: 3] NEW YORK COUNTY CLERK 09/16/2020 11:57 AM NYSCEF DOC. NO. 903 INDEX NO. 652050/2015 RECEIVED NYSCEF: 09/16/2020 Uniform Rules for Trial Courts (22 NYCRR) § 202.21 (e) allows a party to move to vacate a note of issue, "[w]ithin 20 days after service of a note of issue and certificate of readiness ... upon affidavit showing in what respects the case is not ready for trial, and the court may vacate the note of issue if it appears that a material fact in the certificate of readiness is incorrect, or that the certificate of readiness fails to comply with the requirements of this section in some material respect." "[A] note of issue should be vacated when [it] is based upon a certificate of readiness which contains an erroneous fact, such as that discovery has been completed" (see Ruiz v Park Gramercy Owners Corp., 182 AD3d 4 71, 4 71 [I st Dept 2020] [internal quotation marks and citation omitted] Under these circumstances, the court hereby grants Landlord's motion (see Perez v Kone, 166 AD3d 555, 555 [I st Dept 2018]). First, Landlord has moved within 20 days of service of the note of issue. Second, Landlord has shown that when Audthan filed the note of issue, it intended to seek leave to plead additional facts describing Landlord's actions and Audthan's tenancy. While Audthan submits that Landlord has already obtained copies of its insurance policies, compliance with the insurance provisions in the Lease was not an issue alleged in the complaint. Without an amendment, discovery on the insurance issue would not have assisted either party in its prosecution or defense of the action (see CPLR 3101 [a] [stating, in part, that "[t]here shall be full disclosure of all matter material and necessary in the prosecution or defense of an action"]), and Audthan acknowledges that no notice for discovery has been served. Further, two of the cases relied on by Audthan are inapposite, since they concerned amendments to a pleading made after trial under CPLR 3025 (c). Lastly, contrary to Audthan's assertion, Landlord need not demonstrate unusual or unanticipated circumstances (see Kattaria v Rosado, 146 AD3d 457, 457 [1st Dept 2017]). 652050/2015 AUDTHAN LLC vs. NICK & DUKE, LLC Motion No. 020 Page 3 of 5 3 of 5 [*FILED: 4] NEW YORK COUNTY CLERK 09/16/2020 11:57 AM NYSCEF DOC. NO. 903 INDEX NO. 652050/2015 RECEIVED NYSCEF: 09/16/2020 The court is cognizant of the additional delay vacating the note of issue will cause, and hereby directs that all discovery shall be completed within a short time frame as directed below. Thus, the parties are encouraged to work together to jointly resolve any outstanding discovery issues in an expeditious manner. Accordingly, it is ORDERED that the motion of defendant Nick & Duke LLC to vacate the note of issue and certificate of readiness (motion sequence no. 20) is granted, and the note of issue is vacated and the case is stricken from the trial calendar; and it is further ORDERED that, within 15 days from the entry of this order, defendant Nick & Duke LLC shall serve a copy of this order with notice of entry on all parties and upon the Clerk of the General Clerk's Office (60 Centre Street, Room 119), who is hereby directed to strike the case from the trial calendar and make all required notations thereof in the records of the court; and it is further ORDERED that service upon the Clerk of the General Clerk's Office shall be made in accordance with the procedures set forth in the Protocol on Courthouse and County Clerk Procedures for Electronically Filed Cases (accessible at the "E-Filing" page on the court's website at the address www.nycourts.gov/supctmanh); and it is further ORDERED that all farther discovery in this matter shall be completed within 60 days from the date of service of a copy of this order with notice of entry; and it is further ORDERED that, within 15 days from completion of discovery, plaintiff Audthan LLC shall cause the action to be placed upon the trial calendar by the filing of a new note of issue and certificate of readiness (for which no fee shall be imposed), to which shall be attached a copy of this order; and it is further 652050/2015 AUDTHAN LLC vs. NICK & DUKE, LLC Motion No. 020 Page 4 of 5 4 of 5 [*FILED: 5] NEW YORK COUNTY CLERK 09/16/2020 11:57 AM NYSCEF DOC. NO. 903 INDEX NO. 652050/2015 RECEIVED NYSCEF: 09/16/2020 ORDERED that the parties shall appear for a virtual status conference in Part 43, on October 29, 2020, at 11 a.m. ~-:::::::E::D,::J:::e::.C=.pilt------ DATE 9/15/2020 CASE DISPOSED CHECK ONE: x GRANTED D NON-FINAL DISPOSITION DENIED GRANTED IN PART APPLICATION: SETTLE ORDER SUBMIT ORDER CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT 652050/2015 AUDTHAN LLC vs. NICK & DUKE, LLC Motion No. 020 D OTHER D REFERENCE Page 5 of 5 5 of 5

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