Weber v Barnett

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Weber v Barnett 2022 NY Slip Op 33200(U) September 19, 2022 Supreme Court, Kings County Docket Number: Index No. 508333/2022 Judge: Leon Ruchelsman 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. INDEX NO. 508333/2022 FILED: KINGS COUNTY CLERK 09/22/2022 01:32 PM NYSCEF DOC. NO. 53 RECEIVED NYSCEF: 09/22/2022 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF KINGS : CIVIL TERM: PART 16 ---· - ·-· ----·------•--: --------. --------·· ---·x YOEL WEBER and YOEL LEONOROVITZ, Individually and derivatively on behalf of HORSEPOWER ELECTRIC AND MAINTENANCE CORP., Plaintiff, Decision and order Index No. 508333/2022 - against - GARY BARNETT; HP STOCK LLC and EXTELL DEVELOPMENT COMPANY,· Defendants, September 19, 2 022 --·---·-----· - ·-. ·-.--- ·:------·--- ·----------- ·x· GARY BARNETT, Third-Party Plaintiff, - against PASCACK GROUP LLC and PASCACK WL HOLDINGS LLC, Third-Party Defendantsj ------------- - ---~--. - ----------------x PRESENT: HON. LEON RUCHELSMAN The Plaintiff/Third Party Defendants have moved seeking to compel responses to Notices to Admit served May 31, defendant has opposed the motion, the parties and arguments held. The 2022. Papers have been submitted by After reviewing the arguments of the parties this court now makes the following cteterrninatiort. According to the Verified Com}_)lairit Borsepower Electric and Maintenance Corp., ig equally owned by plaintiffs Yoel Weber, Yoel Leonorovitz and an · entity called HP Stock LLC pursuant operating agreement !dated October 28, 2014. managing membe.r of HIP Stoel<.. subcontractor. ih the to an Gary Barnett is the Horsepower Electric is an electrical constructio.fi. industry. Pursuiint :j:o the operating agreement Horsepower Electric was required to prioritize ________________... [* 1] _________________________ 1 of 6 _.._, _______ .,, INDEX NO. 508333/2022 FILED: KINGS COUNTY CLERK 09/22/2022 01:32 PM NYSCEF DOC. NO. 53 RECEIVED NYSCEF: 09/22/2022 on its wo·.rk an beha.;l.f of defeq.dant Extel.l Development Company, the Verified Cbmplaint alleg~s Varicius ezyti t_y owr1ed by Ba_rne·:t t. wron'gs cornmi tted by Barnett including reducing the prof its to which Horsepdwer Eiecd:ric: wa·s entitl~d, f;;i.:ili:p.g pay to Horsepower Electric for work performed on Extel1 projects and other acts 13::nd The Ved. fied Complaint alleges -causes of act.ion f:or cini.1ssions. breac:.h :of fiduciary :duty, bre-ach o.f contract-, unjust enrichment, The tortious. interference , quantum meruit _and attorney's fees. dE:: fenqa:nt. s-erved counte.r.tlaim s. a·n ·answer amended arid . . -~ . . . various raised Re.g:ar:d.1n.g this. motio.n the counterclaim s allege that Horsepower Electric,: termed the Horsepower Jqint Venture, "over _time, a.cqu.iz~d multiple parcels of land in Rockla·nct County; .New York,_ ( \Rockland County Properties') . Village of Chestnut Ridge Upon informat·ion and beJ;i.ef, the Rockland .¢aunty Properties coris:ist of d_ozens .o.f aq:.es o·f most._ly undeveh:,ped Verifi~d Answer with Further, belief, th€) Counterclaim s, counterclaim alleges Weper and I~eonorovitz; <JI th~t 204 land" [NYSCEF "tipori Amended (.see-;: Doc.. #9]). :i-:nt:ormation and in a wrongful effort tb gaih __an unfair advantage and extract conces~.1..ons from B9 rnett and limit ·their l.osse·s on C_c,rp.pany proj~_cts, ha._ve erttbarked oh a. bad fad falth campaign to frustrate Barnett anq appropriate for themselves the Rockland C.ounty Prop·erties" {id. at .1. 248) . co.ti_nterqlaim ·asserts th-at during' a In ·Parag:raph 25.1 the,· meeting· bet.ween W_eper Leonorovitz and . Barnett "neither Weber nor Leonorovitz denied that 2 [* 2] 2 of 6 -········-·· ......... ,~----··-----·=•·:,.,,··, ... ,., .. ,. . ~~ INDEX NO. 508333/2022 FILED: KINGS COUNTY CLERK 09/22/2022 01:32 PM NYSCEF DOC. NO. 53 RECEIVED NYSCEF: 09/22/2022 Barnett bad a one- third- irr:i:.e.,rest. in th.~ entit_ies that qwned :the Rockl.an:d County Pr.operti:es. tnstead, to j ll.Sti;fy excluding: Barnett from .all fllj:"ther interest in: the Rockland county P:ropert"ies, they argued that. Barnett's failure to timely adhere to t.h~. forma.lity· -of an ope.r a tiing executing agreement reflecting Barnett'.$ interest soineho·w rendered- Barrilett' s interest ·unenforceabl e, and - incredibly arguably forf_¢l ted" ( id) . As noted on May 31, 2022 the plaintiff served notices to admit -i;l.l_l in:voivi.ng the cpuntercla.im about the properti-e.s in Rockland C_oupty. to admit contain: twe.n-ty-thr_ee Specifi¢ally , the notices and paragraphs individual reque-st.-s th.ree through all eigrrt. , them, of de-i:J,1_ with the exception cif wit,.h various a:spects of ·the operating agreements o.f the third party defendant$ an_d various The defendant- bas objected to s-lich provisions of such agte·ements. .notice:s to :a,dmit on· the grounds they s~ek ultimate·- issues in the case. Conclusions of Law I t is we::11 settled that a not.ice to. admit .i,s a proper device to resolve matters of fa.cf, about which there is no disagr·eement , in order to ·._ expedite matters- for t.~ial ·(32 nd Avenue LLC v·. An{;ielo Holding How.ever, C:orQ..,. a 1.34 · AD3d 696 1 notice 'to admit contested ques-tion·s·' ,of fact 20. NYS3d may not be 42d [2d Dept., utili_z·ect (Burrell v. West, fo"r 2015]). ult.i:rn.atE;l 16J A03d 6q0, 81 NYS3d 433 [2d Dept;~ .201.8]). 3 [* 3] 3 of 6 -------·------------··--···-··~-------- .,,.~.--.--~-·~ . INDEX NO. 508333/2022 FILED: KINGS COUNTY CLERK 09/22/2022 01:32 PM NYSCEF DOC. NO. 53 RECEIVED NYSCEF: 09/22/2022 The third counterclaim a.s-serts a caus:e of _actio-n. for breach Paragraph fiducia.ry duty regarciing the Rockla_nd Go.unty propertie.s. alleges 267 that "as the mari"agirig co-venturers , Ci.·f and Wel:>er Leono..to.vi tz owed a. fiduciary duty t_o Barnett to hold his membersh._ip interest in the ij•rs~power Joint Vehture, intludin~ Barnett's interest in and to the- Rockland County P·roperties on behalf of the and ventur.e; Wepet and L'eonorb-vitz were not .permitted to appropriate. the c:ipportunitie s and benefit,s incidental to tpe p.osi t ion th:e y occupied_ --as co-venturers rights": (id).. specific.:i.. ty. in: der·oga t ion. of Ba rtiet t' ·s Two parag:raphs later the couhtetclairn .. l')rovioes .m9r~ It a:.sserts that ''Weber and Leonorovitz ~ ·s conduct .i,:£;1, .among _other things: : (.:j_") usurping Barnett-'· s ovv-nership interest ·in the Rockland County Properties,; (i.:i..) creating documents t.o conceal Barnett's contributions · ·to ·the Rockland Coun,ty Properties; {iii) re'.fusing to acknow.l~dg~. Barnett'!'? ·e.qt1ity share of the: entities that own the Roc.kland finaricTal records County Pr'ciperties; or (iv) refusing to turnover other r·ecords. re.lated to Barn.ett'·_s equity s-hare. of the Rqckl-and County ~roperties; and (v) appropriatihg for themselves benefits :and prof:i.ts generaily of the Hb.tsepowe·r Joint 'Venture in staik cierog_ation c:if Barn_ett'·.s rightful expectations as a partner in a cornrtton venture, breaches constitute of their fiduciar·y duties and: duties of utmost good ·faith .and loyaltyfi (see, Amended Verifi·_ed essentially, the .Answe:i; with counterclaim Couri.te-rclairn s, alleges the ···············-····· 269) . plaintiffs 4 [* 4] 'l[ 6 ------ - - - - - - - - - - - - -4-of Thus,. acteo. to INDEX NO. 508333/2022 FILED: KINGS COUNTY CLERK 09/22/2022 01:32 PM NYSCEF DOC. NO. 53 RECEIVED NYSCEF: 09/22/2022 The ·e1imi.nate B-arrett.~··s share fr-om. the Rockla·ncl ~ou.nty p·ropert.i,es. n.otic,e.s to a:9-mit seE:!k tp compel Barrett to p:o,mit that he ha.s no share in the Rockland County properties . .A.. C-3.ref.µl r·e-view of the notices. to a.qmi t r(:!veal.s. that reque:.sts two, one, nine and •fit:t.een all concern the "true and accurate" .operating agreemepts of Pascack Group LLC ahd :•Pascack WL Holdings LLC as well as the list,. of members o:f ea:ch entity. H.owever·, there is no way the c:iefendant could admit to such. inforni.atioh :Since he li.as n"o way of kno~in;g,. since· he is not a signatory;. whether those Requests three through eight $~ek documents a:re true and accurate. an whether. admission joint any or joint exists. the between How(:!ver f it i.s wel 1 ·settled that a .plaint.if f s and the defendant-. partnership venture not nee.ct ventu.re be in writing to be enfo-rceab1e (.§..§.§., Blank v, Nadler, 143 AD2d 9·66, 533 NYS2q 8 91 [ 2d Dept.; 198 8 l) . .Mor_eqve,r, the exi..stence of an ora.l agreement is generally a question of fact ( see, Ma:rtin v, Cohen, l 7 Misc3d 1.116 .(.-A.), R51 NYS2d 64 (Supreme Court Suffolk Coµnty :r.t007]). Thu.s, ~hese ..reque.5ts £0.r. a,;:\iu.iselon are more than rner.e matters aQ9ut which there .is no disagreement . t.he counter.claim . about operational I.ndeed; they concern the very ·crux· of The, ;i:-ernainder of the ·requests ·s:eek adro;issions provisions of. the operating agree:rt1ents and admissions that defencJant "Barnett. did not tak·e certain actions with These matte·rs are .hot matters that respect to th6·$.e ag~eeme.nts. could not possiblyi be to subject .any dispute but rather are 5 [* 5] .... 5 of 6 ·························· ···-··················-··· ···········------------- -···•·-·-~··---· INDEX NO. 508333/2022 FILED: KINGS COUNTY CLERK 09/22/2022 01:32 PM NYSCEF DOC. NO. 53 RECEIVED NYSCEF: 09/22/2022 vigorousJy conte:sted; These notices to admit seek to undermine Barrett's ability to pursue his counterclaim regarding the Rockland County properties. That is an improper 1.1se of a notit_e to admit. Therefore, base;d on the foregoing, the motion seeking to compel the defendant:to responci to the notices to admit is denied. So ordered. ENTER: DATED: September 19,, 2022 Brooklyn N. Y. • Hon. Leon Ruchelsman JSC 6 [* 6] 6 of 6

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