Ejectment of Boxing Gym: Throw in the Towel!

Posted on April 6, 2021 by Richard Klass

COVID-19 has had a deleterious effect on New York’s commercial landlords. Due to the pandemic, many tenants have been unable to meet their lease obligations; in turn, this has resulted in the domino effect of landlords being unable to meet their mortgage obligations. Landlords have been hampered from evicting non-paying commercial tenants because of the Governor’s executive orders placing a moratorium on commercial evictions for over a year.

Caught up in the current quagmire, landlords whose tenants have defaulted under their commercial leases for reasons other than nonpayment of rent have had a difficult time removing them from the premises.

Boxing gym with troubling lease violations

According to the landlord, a fitness center specializing in boxing, martial arts and MMA-inspired workout routines was violating the terms of its lease prior to the pandemic. The allegations against the fitness center included:

Lack of special fitness center permit: NYC Zoning Regulations §12-10 define a “physical culture or health establishment” as “any establishment or facility, including commercial and non-commercial clubs, which is equipped and arranged to provide instruction, services, or activities which improve or affect a person’s physical condition by physical exercise or by massage.” The NYC Department of Buildings requires that businesses operating as a physical culture establishment or facility have a special permit in order to operate. The tenant never obtained the special permit and was alleged to have abandoned the application process;
Failure to obtain a health club license: The tenant agreed in the lease to “file any and all applications for permits and licenses required by any local, federal, state or city municipal agency for the conduct of tenant’s business and the operation and maintenance of the demised premises.” The lack of the license was alleged to be a breach of the lease;
Dissolution of corporation: The tenant was operating the fitness center despite the corporation having been dissolved by the New York Secretary of State years ago;
Lack of insurance: The lease required the tenant to maintain general liability insurance to cover any claims for bodily injury or death or property damage occurring on the premises of at lease $2 million per occurrence. The tenant did not provide the landlord with proof of insurance;
Non-payment of rent: The landlord claimed substantial rent arrears were due from the tenant for many months’ worth of rent and taxes owed.

Immediate Request for Order of Ejectment

The landlord retained Richard A. Klass, Esq., Your Court Street Lawyer, to bring an action against the fitness center to regain possession of the premises. An action for “ejectment” of the tenant from the premises was commenced and an Order to Show Cause was immediately filed, asking the judge to issue an Order of Ejectment.

Preliminary injunction request

Under CPLR 6301, a court is authorized to grant a preliminary injunction where it appears that the defendant threatens or is about to do an act in violation of the plaintiff’s rights regarding the subject of the action, which would tend to render any judgment ineffectual. The court may also grant a temporary restraining order (“TRO”) where it appears that there is the potential for immediate and irreparable injury, loss or damage. The plaintiff must show that: (1) there is a likelihood of the plaintiff’s success on the merits; (2) irreparable harm will occur without an injunction; and (3) a balancing of the equities tips in the plaintiff’s favor. See, Hoeffner v. John F. Frank Inc., 302 AD2d 428 [2 Dept. 2003].

Likelihood of success on the merits: The landlord alleged that the tenant remained in possession of the premises, continuing to operate its fitness center, despite the lease having been terminated; the tenant owing substantial rent arrears; the corporation having been dissolved; there being no license or permit to operate as a health club; and the lack of insurance coverage. The landlord made a prima facie showing of its right to relief. See, Terrell v. Terrell, 279 AD2d 301 [1 Dept. 2001].
Irreparable harm or injury: The tenant allegedly continued operating as a fitness center to the detriment of not only the landlord but also its gym patrons and the general public. The landlord urged that the threats to the public included the lack of liability insurance, operating an unlicensed facility with lack of proper permits, and the potential exposure of bodily injury or damage claims. These were alleged to be of actual, imminent harms to be suffered and were not remote possibilities or speculation. See, Khan v. State University of New York Health Science Center at Brooklyn, 271 AD2d 656 [1 Dept. 2000].
Balancing of the equities: The landlord asked the judge to consider the harms each side would suffer and that they would tilt in favor of ejecting the tenant. In balancing the equities of the situation, “it must be shown that the irreparable injury to be sustained … is more burdensome [to the plaintiff] than the harm caused to the defendant through imposition of the injunction.” McLaughlin, Piven, Vogel, Inc. v. W.J. Nolan & Co. Inc., 114 AD2d 165 [2 Dept. 1986].

The judge considered the landlord’s request and granted the Order of Ejectment. The New York City Sheriff immediately issued process on the fitness center and, acting on the Order of Ejectment, delivered possession of the boxing gym to the landlord.

R. A. Klass
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Only certain documentary evidence can qualify for dismissal of an action.

Posted on March 24, 2021 by Richard Klass

The court in Bianco v Law Offices of Yuri Prakhin, 189 AD3d 1326 [2d Dept 2020] held that only certain documentary evidence can qualify for dismissal of an action under CPLR 3211(a)(1):

On a motion to dismiss pursuant to CPLR 3211, the pleading is to be afforded a liberal construction (see CPLR 3026). The facts as alleged in the complaint are accepted as true, the plaintiff is afforded the benefit of every possible favorable inference, and the court determines only whether the facts as alleged fit within any cognizable legal theory (see Leon v. Martinez, 84 N.Y.2d 83, 87–88, 614 N.Y.S.2d 972, 638 N.E.2d 511). Under CPLR 3211(a)(1), a dismissal is warranted only where the documentary evidence utterly refutes the plaintiff’s factual allegations, conclusively establishing a defense as a matter of law (see Goshen v. Mutual Life Ins. Co. of N.Y., 98 N.Y.2d 314, 326, 746 N.Y.S.2d 858, 774 N.E.2d 1190; Leon v. Martinez, 84 N.Y.2d at 88, 614 N.Y.S.2d 972, 638 N.E.2d 511). In order for evidence to qualify as documentary, it must be unambiguous, authentic, and undeniable (see Granada Condominium III Assn. v. Palomino, 78 A.D.3d 996, 996–997, 913 N.Y.S.2d 668; Fontanetta v. John Doe 1, 73 A.D.3d 78, 86, 898 N.Y.S.2d 569). “[J]udicial records, as well as documents reflecting out-of-court transactions such as mortgages, deeds, contracts, and any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence in the proper case” (Fontanetta v. John Doe 1, 73 A.D.3d at 84–85, 898 N.Y.S.2d 569 [internal quotation marks omitted]; see First Choice Plumbing Corp. v. Miller Law Offs., PLLC, 164 A.D.3d 756, 758, 84 N.Y.S.3d 171). Neither affidavits, deposition testimony, nor letters are considered documentary evidence within the intendment of CPLR 3211(a)(1) (see *579 Fox Paine & Co., LLC v. Houston Cas. Co., 153 A.D.3d 673, 678, 60 N.Y.S.3d 294; Granada Condominium III Assn. v. Palomino, 78 A.D.3d at 997, 913 N.Y.S.2d 668).

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Continuous representation doctrine toll only applies to the particular matter.

Posted on March 17, 2021 by Richard Klass

In Pace v Horowitz, 190 AD3d 619 [1st Dept 2021], the court held that the continuous representation doctrine toll only applies to the particular matter, not general representation. The court held:

The court correctly determined that plaintiffs failed to show that there is an issue of fact as to whether the legal malpractice claim was timely filed based on the application of the continuous representation doctrine toll (see Marzario v Snitow Kanfer Holzer & Millus, LLP, 178 AD3d 527, 528 [1st Dept 2019]). The continuous representation doctrine toll does not apply based merely on the existence of an ongoing professional relationship, but only where the particular course of representation giving rise to the particular problems resulting in the alleged malpractice is ongoing (see Matter of Lawrence, 24 NY3d 320, 341 [2014]; Williamson v PricewaterhouseCoopers LLP, 9 NY3d 1 [2007]). Here, while plaintiffs allege that defendant law firm provided continuing estate administration work as part of an ongoing professional relationship of estate administration, they do not adequately allege that the particular course of representation regarding the sale of estate assets in 2007, which gave rise to the malpractice allegations, continued through February 2015, so as to make the instant malpractice claim timely filed.

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Statute of limitations: Court dismissed client’s legal malpractice action.

Posted on March 10, 2021 by Richard Klass

In Flintlock Constr. Services, LLC v Rubin, Fiorella & Friedman, LLP, 188 AD3d 530 [1st Dept 2020], the court dismissed the client’s legal malpractice action based on the statute of limitations, holding:

Plaintiff commenced this action on September 17, 2018, alleging that defendant committed legal malpractice by entering into the stipulations. Plaintiff alleges that entering into the 2007 stipulation, which shifted the responsibility for Well–Come’s defense from plaintiff’s insurer to plaintiff alone, was professional negligence. In December 2018 defendant moved to dismiss the complaint pursuant to CPLR 3211(a)(5). The motion court ruled that the complaint was time-barred because the statute of limitations had begun to run on July 29, 2013, the date on which the jury rendered its verdict, which was the date on which plaintiff’s damages were reasonably calculable. We affirm.

“On a motion to dismiss a cause of action pursuant to CPLR § 3211(a)(5) as barred by the statute of limitations, a defendant must establish, prima facie, that the time within which to sue has expired. Once that showing has been made, the burden shifts to the plaintiff to raise a question of fact as to whether the statute of limitations has been tolled, an exception to the limitations period is applicable, or the plaintiff actually commenced the action within the applicable limitations period.” (Quinn v. McCabe, Collins, McGeough & Fowler, LLP, 138 A.D.3d 1085, 30 N.Y.S.3d 288 [2d Dept. 2016] [internal quotation marks omitted] ).

“An action to recover damages for an attorney’s malpractice must be commenced within three years from accrual (see CPLR § 214[6]). A legal malpractice claim accrues when all the facts necessary to the cause of action have occurred and an injured party can obtain relief in court. In most cases, this accrual time is measured from the day an actionable injury occurs [or when the damages are sufficiently calculable], even if the aggrieved party is then ignorant of the wrong or injury.” (McCoy v v. Feinman, 99 N.Y.2d 295, 301, 755 N.Y.S.2d 693, 785 N.E.2d 714 [2002] [internal quotation marks and citation omitted]; King Tower Realty Corp. v. G & G Funding Corp., 163 A.D.3d 541, 79 N.Y.S.3d 289 [2d Dept..2018]).

Any damages arising from defendant’s alleged malpractice were sufficiently calculable for pleading purposes when the jury rendered its verdict on July 29, 2013, and the action commenced on September 17, 2018 is time-barred.

Plaintiff has not shown that the statute was tolled or that plaintiff was actively misled or prevented in some extraordinary way from timely commencing a malpractice action (see Yarbro v. Wells Fargo Bank, N.A., 140 A.D.3d 668, 668, 33 N.Y.S.3d 727 [1st Dept. 2016]; Jang Ho Choi v. Beautri Realty Corp., 135 A.D.3d 451, 22 N.Y.S.3d 431 [1st Dept. 2016]).

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A motion to dismiss based upon documentary evidence should be conclusive.

Posted on February 16, 2021 by Richard Klass

The decision in Bianco v Law Offices of Yuri Prakhin, 189 AD3d 1326, 1327-29 [2d Dept 2020] serves as a good reminder that a motion to dismiss an action based upon documentary evidence should be conclusive; otherwise, the motion will be denied:

On a motion to dismiss pursuant to CPLR 3211, the pleading is to be afforded a liberal construction (see CPLR 3026). The facts as alleged in the complaint are accepted as true, the plaintiff is afforded the benefit of every possible favorable inference, and the court determines only whether the facts as alleged fit within any cognizable legal theory (see Leon v Martinez, 84 NY2d 83, 87-88 [1994]). Under CPLR 3211 (a) (1), a *1328 dismissal is warranted only where the documentary evidence utterly refutes the plaintiff’s factual allegations, conclusively establishing a defense as a matter of law (see Goshen v Mutual Life Ins. Co. of N.Y., 98 NY2d 314, 326 [2002]; Leon v Martinez, 84 NY2d at 88). In order for evidence to qualify as documentary, it must be unambiguous, authentic, and undeniable (see Granada Condominium III Assn. v Palomino, 78 AD3d 996, 996-997 [2010]; Fontanetta v John Doe 1, 73 AD3d 78, 86 [2010]). “[J]udicial records, as well as documents reflecting out-of-court transactions such as mortgages, deeds, contracts, and any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence in the proper case” (Fontanetta v John Doe 1, 73 AD3d at 84-85 [internal quotation marks omitted]; see First Choice Plumbing Corp. v Miller Law Offs., PLLC, 164 AD3d 756, 758 [2018]). Neither affidavits, deposition testimony, nor letters are considered documentary evidence within the intendment of CPLR 3211 (a) (1) (see Fox Paine & Co., LLC v Houston Cas. Co., 153 AD3d 673, 678 [2017]; Granada Condominium III Assn. v Palomino, 78 AD3d at 997). Accordingly, the hearing transcripts, affirmation, and affidavit relied upon by the Kletzkin defendants and the Schneider defendants in support of their respective motions do not constitute documentary evidence for the purposes of CPLR 3211 (a) (1). Additionally, the trial counsel agreement between the Schneider defendants and the Kletzkin defendants, which does constitute documentary evidence, did not utterly refute the factual allegations of the complaint and did not conclusively establish a defense to the claims as a matter of law.

On a motion made pursuant to CPLR 3211 (a) (7), the burden never shifts to the nonmoving party to rebut a defense asserted by the moving party (see Sokol v Leader, 74 AD3d 1180, 1181 [2010]). “Unless the motion is converted into one for summary judgment pursuant to CPLR 3211 (c), ‘affidavits may be received for a limited purpose only, serving normally to remedy defects in the complaint,’ and such affidavits ‘are not to be examined for the purpose of determining whether there is evidentiary support for the pleading’ ” (Sokol v Leader, 74 AD3d at 1181, quoting Rovello v Orofino Realty Co., 40 NY2d 633, 635, 636 [1976]; see Nonnon v City of New York, 9 NY3d 825, 827 [2007]). Affidavits submitted by a defendant “will almost never warrant dismissal under CPLR 3211 unless they establish conclusively that [the plaintiff] has no . . . cause of action” (Lawrence v Graubard Miller, 11 NY3d 588, 595 [2008] [emphasis and internal quotation marks omitted]; see Sokol v Leader, 74 AD3d at 1182). “[U]nless it has been shown that a *1329 material fact as claimed by the pleader to be one is not a fact at all and unless it can be said that no significant dispute exists regarding it, again dismissal should not eventuate” (Guggenheimer v Ginzburg, 43 NY2d 268, 275 [1977]). “Whether a plaintiff can ultimately establish its allegations is not part of the calculus in determining a motion to dismiss” (EBC I, Inc. v Goldman, Sachs & Co., 5 NY3d 11, 19 [2005]; see Carlson v American Intl. Group, Inc., 30 NY3d 288, 298 [2017]; AG Capital Funding Partners, L.P. v State St. Bank & Trust Co., 5 NY3d 582, 591 [2005]).

Here, the plaintiff adequately pleaded the cause of action alleging legal malpractice against the Kletzkin defendants and the Schneider defendants. Contrary to the contentions of those defendants, neither conclusively established that an application for leave to serve a late notice of **3 claim or to deem the late notice of claim timely served upon the NYCTA nunc pro tunc would have been futile (see generally Matter of Newcomb v Middle Country Cent. Sch. Dist., 28 NY3d 455, 465 [2016]; Davis v Isaacson, Robustelli, Fox, Fine, Greco & Fogelgaren, 284 AD2d 104, 105 [2001]).

Contrary to the Kletzkin defendants’ contention, the complaint adequately states a cause of action to recover damages for violation of Judiciary Law § 487. Contrary to the Schneider defendants’ contention, the cause of action alleging violation of Judiciary Law § 487 is not duplicative of the cause of action alleging legal malpractice. “A violation of Judiciary Law § 487 requires an intent to deceive (see Judiciary Law § 487), whereas a legal malpractice claim is based on negligent conduct” (Moormann v Perini & Hoerger, 65 AD3d 1106, 1108 [2009]; see Bill Birds, Inc. v Stein Law Firm, P.C., 164 AD3d 635, 637 [2018], affd 35 NY3d 173 [2020]).

R. A. Klass
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