Manda Intl. Corp. v Red Hook 160 LLC

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Manda Intl. Corp. v Red Hook 160 LLC 2023 NY Slip Op 33126(U) August 25, 2023 Supreme Court, Kings County Docket Number: Index No. 531163/2022 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. 531163/2022 FILED: KINGS COUNTY CLERK 09/07/2023 01:11 PM NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 09/07/2023 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF KINGS ; CIVIL TERM: COMMERCIAL PART 8 --------- --------------------------------x MANDA INTERNATIONAL CORP. , Plaintiff, Decision and order Index NO. 531163/2022 - against RED HOOK 160 LLC, PHILADELPHIA INDEMNITY INSURANCE COMPANY, and JOHN DOES 1-1, Defendants, August 25, 2023 ---- .---.-- .. ·-. -- . ·.------ ··------ ·---· -· _, ___ x PRESENT: HON. LEON RUCHELSMAN Motion Seq. #1 The defendants have moved pursuant to CPLR §3211 seeking to dismiss the complaint. Papers were submittied The plaintiff has opposed the motion. by the parties and arguments held. After reviewing all the arguments this court now makes the following determination. As recorded in prior orders, on December 4, 2019 the plaintiff was hired by the defendant as a Construction manager to complete a construction project located at 160 Imlay Street in Kings County. .A.g:reement, The parties entered into a Construction Management referred to as the CM. At:;Jreerri.ent and i t provided a guaranteed,.maximurn price of $2,064,500. Further; the CM Agreement contained exhibits that delineated work to be performed by Strikefotce Mechanical Corp. plaintiff submitted The c:omplaint alleges that the invoice.s for payment and that the defendant did not fully pay all the inv.oices. Consequently, on November 5, 2020 the. plaintiff filed a mechanic's .lien in the. amount of. $1,595,309.25~ [* 1] Further, the plaintiff asserts there are other 1 of 4 INDEX NO. 531163/2022 FILED: KINGS COUNTY CLERK 09/07/2023 01:11 PM NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 09/07/2023 fees owed and seeks recovery of $2,325,881.53. The complaint alleges causes of action fo.t breach Of contract, account stated, to foreclose the mechanic's lien, quantum meruit and a declaratory judgement. The defendant has moved seeking to dismiss the complaint on the grounds the agre·ement was assigned to another entity, namely Churchill 160 Imlay Lencl.er LLC [hereinafter Churchill] and that any action to recover any payments should be directed to that assignee. The plaintiffi as hoted, argues the motions should be denied. conclusions of Law It is well settled that up6n a motion to dismiss the ·court must determine; accepting the allegations of the complaint as true, whether the party can succeed upon any reasonable view of those facts (Ripa v. Pet.tosyants, 203 AD3d 768J 160 NYS3d 658 [2d Dept., 2022]). Further/ all the allegations in the complaint are deemed true arid all reasonable inferences may be drawn in favor of the plain.tiff (BT Holdings, LLC v. Village of Chester; 189 ,AD3d 7 5 4 , 13 7 NYS2d. 45 8 [ 2 d. Dept. , 2 020] ) . Wl,.ethe r the complaint will later survive a motion for surhmary judgment, or whether the plaintiff will ultimately be able to prove its claims, of course, plays no part in the determination of a pre-discovery CPLR §3211 motion to dismiss (see, Redwood Property Holdings, LLC v. Christopher:, 211 ADJd 7 58 1 177 NYS3d 895, [ 2d Dept., 2022]) . The assignment entered into between the owner and Churchill 2 [* 2] 2 of 4 INDEX NO. 531163/2022 FILED: KINGS COUNTY CLERK 09/07/2023 01:11 PM NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 09/07/2023 $tates that "Contractor shall look only to the estate and interest, if any, of Lender in the Property for the satisfaction of Contractor's remedies for the collection of a jud,gment (or other judicial process) requiring the payment of money in the event of any default by Lender as "Owner" under the Construction Management Agreement or under this Assignment, and no other property or assets of Lender shall be subject to levy, execution or other enforcement procedure for the satisfaction of Contractor's remedies under or with respect to the Construction Management Agreement, the relationship of the "Owner" and "Construction Manager;' under the Construction Management Agreement or any claim arising under this Agreement" (see, Assignment of Construction Management Agreement and Subordination of construction Management Fees, '][16 [NYSCEF Doc. No. ':1[17]). The above language specifically states the owner remains liable for any claims. Indeed,; this exclusion of liability comports with the well established rule that "ari. assignment does. not release the assignor of its ohligaticms under the assigned contract" (see, Mandel v. Fischer, 205 AD2d 375, 613 NYS2d 381 [l "t Dept., 1994]) . Thus, the assignment agreement only assigned the benefits of the: construction agreement and not any of its liabiliti,es. The detenda,nt argues t.hat "pursuant td New York law, when a t:ontracting party ceiri.sents to the assignment of the ccmtract by 3 [* 3] 3 of 4 INDEX NO. 531163/2022 FILED: KINGS COUNTY CLERK 09/07/2023 01:11 PM NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 09/07/2023 the other party and accepts the assignee in place of the< assignor, the assignor is relieved from its continuing liability under the contract. Therefore, RH 160, as assignor, is relieved of its continuing liability under the CM Agreement and Plaintiff must assert its c·laims, against the true counterparty to the CM Agreement - Churchill'' (see, Memoranclum in Support, page 4 [NYSCEF Doc. No. 12]). However, the defendant failed to cite any cases in support of that broad proposition. In fact, that assertion is contradicted by numerous cases of the past one hundred years that have held otherwise (see, Rosenthal Paper Company v. National Folding Box & Paper Company, 226 NY 313, 226 NY 313 [1919] where the court held concerning an assignor that "the assignment did not absolve him from its obligations. Resort could still be made to him for the stipulated protection or damages for a breach"). Therefore, Manda may pursue claims against the defendant.s including the owner of the property. Consequently; the motion seeking to dismiss the action is denied, So ordered. EN'I'ER: DATED: ~ugust 25,. 20.23 Brooklyn N.Y. Hon. L.e.on Rudhelsman JSC 4. [* 4] 4 of 4

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