88 Global Partners LLC v 141 E. 88th St. Realty LLC

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88 Global Partners LLC v 141 E. 88th St. Realty LLC 2023 NY Slip Op 34348(U) November 17, 2023 Supreme Court, New York County Docket Number: Index No. 850089/2022 Judge: Francis A. Kahn III 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. 850089/2022 NYSCEF DOC. NO. 202 ,eECEIVED NYSCEF: 11/27/2023 SUPREME COURT OF THE STATE OF NEW YORt\. NEW YORK COUNTY PRESENT: l 32 PART HON. FRANCIS A. KAHN, Ill Justice ------------------------- -- -----------------------------------------------------X INDEX NO. 88 GLOBAL PARTNERS LLC, 850089/2022 MOTION DATE Plaintiff, MOTION SEQ. NO. 005 -v141 EAST 88TH STREET REAL TY LLC,BEN ASHKENAZY, BOARD OF MANAGERS OF THE PHILIP HOUSE CONDOMINIUM, NEW YORK CITY ENVIRONMENTAL CONTROL BOARD, NEW YORK STATE DEPARTMENT OF TAXATION AND FINANCE, NEW YORK CITY DEPARTMENT OF TAXATION AND FINANCE, FEDEX OFFICE AND PRINT SERVICES, INC.,FLOWERS BY PHILIP CORP., PB UPPER EAST SIDE LLC,WlLLOW POP INC. D/B/AWILLOWPOP, PATIS 1311 LLC D/8/APATIS, JOHN DOE #1 THROUGH JOHN DOE #10, DECISION + ORDER ON MOTION Defendant. --------------------------------------------------------------------------------X The following e-filed documents, listed by NYSCEF document number (Motion 005) 154, 155, 156, 157, 158,159,160,161,162,163,164,165,166,167,168, 169,170,171,172,173,174,175,176,177,178, 179,180,181,182, 183,184,185, 186,187,188,189,190,191,192,193,194,195, 196, 197,198,199 were read on this motion to/for JUDGMENT - SUMMARY Upon the foregoing documents, the motion is determined as follows: The within action is to foreclose on a severed mortgage encumbering six parcels of commercial real property located at 141 East 88th Street a/k/a 1327-1329 and 13 I 1-1337 Lexington Avenue, Commercial Units 1, 2, 3, 4, 4A and 5, New York New York (Block: 1517, Lot 1101, 1102, 1103, 1104, 1105 and 1106). The mortgage was given by Defendant 141 East 8 8th Street Realty, LLC ("Realty") to non-party 88 th Street NY Funding LLC ("Funding") to secure a loan with an original principal amount of $13,000,000.00 which is memorialized by a restated mortgage note. The note and mortgage are both dated February 7, 2014. The note was executed by non-parties Daniel Levy ("Levy") as vice president of Realty, and the mortgage was executed by non-party Susan Hewitt ("Hewitt") as president of Realty. On the same date, a "modification and extension agreement" was signed by Realty and non-party BankUnited, NA. ("BankUnited"). Concomitantly with these documents, Defendant Ben Ashkenazy ("Ashkenazy") executed two guarantees, one titled "partial" and the other "non-recourse". On May 20, 2020, Realty, Ashkenazy and BankUnited executed a "Commercial Loan Payment Deferral Agreement". Plaintiff commenced this action alleging inter alia Defendants defaulted in repayment under the note. With leave of the Court, Plaintiff filed an amended complaint. Defendants Realty and Ashkenazy answered jointly and pied three [3] affirmative defenses. Now, Plaintiff moves for inter alia summary judgment against Realty and Ashkenazy, striking the appearing Defendants' answer, for a default judgment against the nonappearing parties, for a money judgment against Guarantor Ashkenazy, severance of Plaintiffs fourth and fifth 850089/2022 BANKUNITED, N.A. vs. 141 EAST 88TH STREET REALTY LLC ET AL Motion No. 005 [* 1] 1 of 5 Page 1 of 5 INDEX NO. 850089/2022 NYSCEF DOC. NO. 202 RECEIVED NYSCEF: 11/27/2023 causes of action, appointing a referee to compute, and to amend the caption. Defendants Realty and Ashkenazy oppose the motion. In moving for summary judgment, Plaintiff was required to establish prima facie entitlement to judgment as a matter oflaw though proof of the mortgage, the note, and evidence of Defendants' default in repayment (see eg US. Bank, NA. v James, 180 AD3d 594 [ pt Dept 2020]; Bank ofNY v Knowles, 151 AD3d 596 [l st Dept 2017]; Fortress Credit Corp. v Hudson Yards, LLC, 78 AD3d 577 [1 st Dept 201 0]). Proof supporting a prima facie case on a motion for summary judgment must be in admissible form (see CPLR ~ st §3 212[b]; Tri-State Loan Acquisitions Ill, LLC v Litkowski, 172 AD3d 780 [1 Dept 2019]). A plaintiff may i. rely on evidence from persons with personal knowledge of the facts, documents in admissible form and/or persons with knowledge derived from produced admissible records (see eg US Bank NA. v Moulton, 179 AD3d 734, 738 [2d Dept 2020]). No particular set of business records must be proffered, as long as the admissibility requirements of CPLR 4518[a] are fulfilled and the records evince the facts for which they are relied upon (see eg Citigroup v Kopelowitz, 147 AD3d 1014, 1015 [2d Dept 2017]). l ~ Plaintiff's motion was supported with an affidavit from Isaac Aryeh ("Aryeh"), a member of Plaintiff. i Aryeh stated that his affidavit was based upon both his personal knowledge and examination of business records. His affidavit laid a proper foundation for the admission of Plaintiff's records into evidence under CPLR §4518 (see Bank of NY lvfellon v Gordon, 171 AD3d 197 [2d Dept 2019]). The records of other entities were also admissible since Aryeh sufficiently established that those records were received from the makers and incorporated into the records Plaintiff kept and that it routinely relied upon such documents in its business (see US Bank NA. v Kropp-Somoza, 191 AD3d 918 [2d Dept 2021]). Further, annexed to the motion were records referenced by Ary eh (cf Deutsche Bank Natl. Trust Co. v Kirschenbaum, 187 AD3d 569 [1 st Dept 2020]). Aryeh's affidavit and the referenced documents sufficiently evidenced the note and mortgage. As to the Mortgagor's default, it "is established by (I) an admission made in response to a notice to admit, (2) an affidavit from a person having personal knowledge of the facts, or (3) other evidence in admissible form" (Deutsche Bank Natl. Trust Co. v A-fcGann, 183 AD3d 700, 702 [2d Dept 2020]). Here, Aryeh's personal knowledge and the attached account records demonstrated that the Mortgagor defaulted in repayment under the notes (see eg ~ ING Real Estate Fin. (USA) LLC v Park Ave. Hotel Acquisition, LLC, 89 AD3d 506 [15 1 Dept 2011]). In opposition, Defendants proffered no arguments on the branches of Plaintiff's motion related to summary judgment on its foreclosure cause of action. As to the guaranty, '" [o ]n a motion for summary judgment to enforce a written guaranty all that the creditor need prove is an absolute and unconditional guaranty, the underlying debt, and the guarantor's failure to perform under the guaranty"' (see 4 USS LLC v DSWA1S LLC, 120 AD3d I 049, 1051 [I st Dept 2014], quoting City of New York v Clarose Cinema Corp., 256 AD2d 69, 71 [1 st Dept 1998] ). Under the "partial" guaranty, Ashkenazy "[u]nconditionally and absolutely guarantee[d] payment of ten (l 0%) percent of the principal amount of the Loan required to be paid pursuant to the Loan Documents". The guaranty also provides that it "1:1ay be enforce? by the Mortgagee without first resorting to or exhausting any other security or collateral or without first havmg recourse to the note(s) executed by the Debtor in favor of the Mortgagee or any of the propert~ _covered by ~he Mortgage through foreclosure proceedings or otherwise". Ashkenazy also "absolutely. un~ond1tionally and mevocably waive[d] any and all right to assert any defense, set-off, counterclaim or crossclaim of any nature whatsoever with respect to th[e] Guaranty". Aryeh's affidavit and the supporting ~ocu?1~~ts demonstrated a prima facie case for summary judgment on the cause of action based upon the l partial guaranty. 850~89/2022 BANKUNITED, N.A. vs. 141 EAST 88TH STREET REAL TY LLC ET AL Motion No. 005 [* 2] 2 of 5 Page 2 of 5 INDEX NO. 850089/2022 NYSCEF DOC. NO. 202 RECEIVED NYSCEF: 11/27/2023 Defendants' assertion that the terms of the "limited" guaranty prohibit enforcement of the "partial" guaranty unless one of the conditions triggering liability under the ''limited" guaranty is met is without merit. That argument is belied by the express terms of these guarantees. The only potential limitation in enforcement of the "partial" guaranty was a termination clause which provided that if certain of the lots were leased as provided, Ashkenazy' s obligation under the "partial" guaranty was terminated. No proof of satisfaction of this contingency was submitted by Defendants. Reliance on RP APL § 13 71 is entirely misplaced given the terms of the "limited" guaranty which "waived any defense, reduction or setoff, including as a result of any legal action by mortgagee against the mortgagor" (Anglo Irish Bank Corp. Ltd. v Ashkenazy, l 07 AD3d 602, 603 [1 st Dept 2013 ]). Indeed, Defendants expressly waived reliance on all defenses to enforcement of the guaranty at issue (see eg Citibank v Plapinger, 66 NY2d 90 [1985]; Red Tulip, LLC v Neiva, 44 AD3d 204 [1st Dep't 2007]). As to the branch of Plaintiffs motion to dismiss Defendants' affirmative defenses, CPLR §3211 [bJ prmides that "[a] party may move for judgment dismissing one or more defenses, on the ground that a defense is not stated or has no merit". For example, affirmative defenses that are without factual foundation, conclusory or duplicative cannot stand (see Countrywide Home Loans Servicing, L.P. v Vorobyov, 188 AD3d 803, 805 [2d Dept 2020]; Emigrant Bank v Afyers, 147 AD3d 1027, 1028 [2d Dept 2017]). When evaluating such a motion, a "defendant is entitled to the benefit of every reasonable intendment of its pleading, which is to be liberally ,, construed. If there is any doubt as to the availability of a defense, it should not be dismissed" (Federici v 1\cfetropolis Night Club, Inc., 48 AD3d 741, 743 [2d Dept 2008]). As pled, all the affirmative defenses are entirely conclusory and unsupported by any facts in the answer. As such, these affirmative defenses are nothing more than unsubstantiated legal conclusions which are insufficiently pled as a matter of law (see Board of lvfgrs. (~{ Ruppert Yorkville Towers Condominium v Hayden, 169 AD3d 569 [1 st Dept 2019]; see also Bosco Credit V Trust Series 2012-1 v. Johnson, 177 AD3d 561 [I st Dept 2020]; 170 W Vil. Assoc. v. G & E Realty, inc., 56 AD3d 372 [1st Dept 2008]; see also Becher v Feller, 64 AD3d 672 [2d Dept 2009]; Cohen Fashion Opt., Inc. v V & Ji.1 Opt., Inc., 51 AD3d 619 [2d Dept 2008]). Further, to the extent that specific legal arguments were not proffered in support of any affirmative defense, those defenses were abandoned (see U.S. Bank NA. v Gonzalez, 172 AD3d 1273, 1275 [2d Dept 2019]; Flagstar Bank v Bellafiore, 94 AD3d 1044 [2d Dept 2012]; Wells Fargo Bank A1innesota, NA v Perez, 4 l AD3d 590 [2d Dept 2007]). Plaintiff has established that it is entitled to a default judgment against all non-appearing Defendants (see CPLR §3215; SRA1OFJJ 2012-/Trustv Tella, 139 AD3d 599,600 [l51 Dept 2016]). The branch of Plaintiffs motion to amend caption is granted without opposition (see generally CPLR §3025; JP ,\,/organ Chase Bank, NA. v Laszio, 169 AD3d 885, 887 [2d Dept 2019]). Accordingly, it is O~EREJ? that Plaintiff is _awarded sum:nary judgment on its causes of action for foreclosure against the appearmg parties and a default Judgment agamst the non-appearing defendants; and it is further " . . ?,RDERED that Plaintiff is awarded summary judgment against Defendant Ben Ashkenazy on the h1:1tt~d guaran~ee and the Clerk of the Court for New York County is directed to enter judgment in favor of Plamt1ff and agamst Defendant Ben Ashkenazy in the amount of $1,300,000.00; and it is further . I ORDERED that Plaintiff's fourth and fifth causes of action are severed from this action; and it is further 850~89/2022 BANKUNITED, N.A. vs. 141 EAST 88TH STREET REALTY LLC ETAL Motion No. 005 [* 3] 3 of 5 Page J of S INDEX NO. 850089/2022 NYSCEF DOC. NO. 202 RECEIVED NYSCEF: 11/27/2023 ORDERED that that Clark Whitsett, Esq., 108-26 Myrtle Avenue, Richmond Hill, NY 11418-1235 (718) 850-0003 is hereby appointed Referee in accordance with RP APL § 1321 to compute the amount due to Plaintiff and examine whether the tax parcel can be sold in parcels; and it is further ORDERED that in the discretion of the Referee, a hearing may be held, and testimony taken; and it is further ORDERED that by accepting this appointment the Referee certifies that he is in compliance with Part 36 of the Rules of the Chief Judge (22 NYCRR Part 36), including, but not limited to §36.2 (c) ("Disqualifications from appointment"), and §36.2 (d) ("Limitations on appointments based upon compensation"), and, if the Referee is disqualified from receiving an appointment pursuant to the provisions of that Rule, the Referee shall immediately notify the Appointing Judge; and it is further ll 1 ORDERED that, pursuant to CPLR 8003(a), and in the discretion of the court, a fee of $350 shall be paid to the Referee for the computation of the amount due and upon the filing of his report and the Referee shall not request or accept additional compensation for the computation unless it has been fixed by the court in ! accordance with CPLR 8003(b); and it is further ORDERED that the Referee is prohibited from accepting or retaining any funds for himself or paying funds to himself without compliance with Part 36 of the Rules of the Chief Administrative Judge; and it is further ORDERED that if the Referee holds a hearing or is required to perfonn other significant services in issuing the report, the Referee may seek additional compensation at the Referee's usual and customary hourly rate; and it is further !\ ORDERED that plaintiff shall forward all necessary documents to the Referee and to defendants who · have appeared in this case within 30 days of the date of this order and shall promptly respond to every inquiry made by the referee (promptly means within two business days); and it is further ORDERED that if defendant(s) have objections, they must submit them to the referee within 14 days of the mailing of plaintiffs submissions; and include these objections to the Court if opposing the motion for a judgment of foreclosure and sale; and it is further ORDERED the failure by defendants to submit objections to the referee shall be deemed a waiver of objections before the Court on an application for a judgment of foreclosure and sale; and it is further 1· 1 ORDERED that plaintiff must bring a motion for a judgment of foreclosure and sale within 30 days of receipt of the referee's report; and it is further . ORD~R~D that if plaintiff fails to meet these deadlines, then the Court may sua sponte vacate this order and direct plamt1ff to move again fo~ a? order of reference and the Court may sua sponte toll interest depending on whether the delays are due to plamtiff s failure to move this litigation forward; and it further . ORJ?ERED_ t~at the caption is hereby amended by striking therefrom the "JOHN DOE" defendants as parties herem; and 1t 1s further ORDERED that the caption shall read as follows: 850~89/2022 BANKUNITED, N.A. vs.141 EAST 88TH STREET REALTY LLC ET AL Motion No. 005 [* 4] 4 of 5 Page 4of5 INDEX NO. 850089/2022 NYSCEF DOC. NO. 202 RECEIVED NYSCEF: 11/27/2023 SUPREME COURT OF THE STA TE OF NEW YORK COUNTY OF NEW YORK -----------------------------------------------------------------------X 88 GLOBAL PARTNERS LLC, Plaintiff, -against141 EAST 88TH STREET REAL TY LLC, BEN ASHKENAZY, BOARD OF MANAGERS OF THE PHILIP HOUSE CONDOMINIUM, NEW YORK CITY ENVIRONMENTAL CONTROL BOARD, NEW YORK STATE DEPARTMENT OF TAXATION AND FINANCE, NEW YORK CITY DEPARTMENT OF TAXATION AND FINANCE, FEDEX OFFICE AND PRINT SERVICES, INC., FLOWERS BY PHILIP CORP., PB UPPER EAST SIDE LLC, WILLOW POP INC. D/B/A WILLOW POP, PA TIS 1311 LLC D/B/A PATIS, Defendants. -------------------------------------------------------------------------X and it is further ORDERED that counsel for plaintiff shall serve a copy of this order with notice of entry upon the County Clerk (60 Centre Street, Room 141B) and the General Clerk's Office (60 Centre Street, Room 119), who are directed to mark the court's records to reflect the parties being removed pursuant hereto; and it is further ORDERED that such service upon the County Clerk and 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 All parties are to appear for a virtual conference via Microsoft Teams on March 14, 2024, at 10:00 a.m. If a motion for judgment of foreclosure and sale has been filed Plaintiff may contact the Part Clerk Tamika Wright (tswright@nycourt.gov) in writing to request that the conference be cancelled. If a motion has not been made, then a conference is required to explore the reasons for the delay. ~ C..-V-.--- v..~ 11/17/2023 DATE FANCIS A. KAHN, 111, ~ - N&J.Q.tJD1fpJt~NCIS A. KAHN Ill CHECK ONE: CASE DISPOSED APPLICATION: SETTLE ORDER SUBMIT ORDER CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT GRANTED DENIED 850~89/2022 BANKUNITED, N.A. vs. 141 EAST 88TH STREET REALTY LLC ET AL Motion No. 005 [* 5] 5 of 5 GRANTED IN PART Page 5 of 5 D oTJRS · C · REFERENCE

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