Motion to Amend Answer Granted where Amendments Were Not Palpably Insufficient: Stuart's LLC v Edelman
In a December 27, 2011 decision by Justice Warshawsky, the court granted the motion of defendants Worldwide Sourcing Group and Peter Lister to amend their Answer and Counterclaims to clarify certain counterclaims and to add cross-claims against certain defendants. The parties were engaged in the production, distribution, and sale of clothing, for which they entered into various loans with each other. The proposed counterclaim alleged that the plaintiff Galvin was personally liable on a promissory note of Stuart’s in favor of defendant Worldwide Sourcing Group, but the plaintiffs argued in opposition that the absence of Galivn’s signature on the note precluded his and that the claim failed to state a claim upon which relief could be granted. The non-moving defendants opposed the proposed cross-claims arguing that: 1) they would be prejudiced by them because they discussed the defense of the action with the moving defendants; and 2) with respect to the proposed third cross claim, that it was not based upon any new evidence but upon information that was available to the moving defendants at the time of the original answer. The court explained that on a motion to amend, it need not consider the likelihood of success on the merits but only whether the proposed amendment states a claim. The court further noted that the possibility of a subsequent dismissal of a cause of a cause of action, counterclaim or cross-claim is not determinative of a motion to amend. Finding that the proposed counterclaims and cross-claims were not “palpably insufficient” or “patently devoid of merit,” the court granted the defendants’ motion to amend.
Stuart’s LLC v Edelman, Sup Ct, Nassau County, December 27, 2011, Warshawsky, J., Index No. 012560/2009
My Brother's Keeper; Court Grants Motion for Temporary Receiver for Properties Co-Owned by Deceased's Brother and Widow: Clark v Clark
In a December 20, 2011 decision by Justice Warshawsky, the court granted in part the plaintiff’s motion, pursuant to CPLR 6401 for the appointment of a temporary receiver. The plaintiff, Winifred Clark, the widow of William Clark, brought the action against William’s brother, James Clark. In the instant motion, Winifred moved for the appointment of a temporary receiver for 32 properties, 28 of which she, through William, and James owned as tenants in common; as to the others, the ownership was disputed. Winifred’s brought the motion in an attempt to protect her rights to 50% of the net rental income from the properties, which James managed. The appointment of a temporary receiver is an extreme remedy; the statute requires the movant to prove, by clear and convincing evidence that “there is a danger that the property will be removed from the state, or lost, materially injured or destroyed.” The court explained that while it is “loathe to appoint a receiver in most cases,” and notwithstanding the significant cost required to do so, it found that all of James’ actions taken together, including: defaulting on tax payments; under reporting income; maintaining double books; failing to pay Winifred her fair share of income; and misuse of joint income for personal needs, provided clear and convincing evidence that the CPLR 6401 standard was met. Therefore, the court granted the motion with respect to the 28 properties for which Winifred and James’ co-ownership was undisputed.
Clark v Clark, Sup Ct, Nassau County, December 20, 2011, Warshawsky, J., Index No. 5514/2008
Insurance Broker Can Be Liable for Not Finding the Most Cost Effective Life Insurance Policy: Finkelstein et al. v. Lincoln Natl. Corp. et al.
In an October 14, 2011 decision by Justice Warshawsky the court granted plaintiffs’ motion to amend to add an additional statutory cause of action and an additional party. Defendants were retained to provide estate planning advice and services, including assisting in the purchase of life insurance policies. Plaintiffs alleged that defendants failed to diligently seek the most cost effective insurance policy. Plaintiffs sought to add a cause of action under Insurance Law §§ 4226 and 2123. Defendants opposed arguing that the claims were palpably insufficient because they were not covered by the statutes and were barred by the applicable statute of limitations. The court granted plaintiffs’ motion regarding Insurance Law § 2123 which holds an insurance broker liable for failing to make a complete comparison when presenting various insurance policies but denied the motion as to Insurance Law § 4226 because there was no allegation that defendants misrepresented the terms and conditions of its own insurance policies. The court also held that the claim was not barred by the statute of limitations because it related back to when plaintiffs filed their original complaint. The court also granted plaintiffs’ motion to add one of the individual brokers as a named party based on his testimony that the entity through which he did business was not a legal entity but a marketing name.
Finkelstein et al. v. Lincoln Natl. Corp. et al., Nassau County, October 14, 2011, Warshawsky, J, Index No. 5372/09.
Court Decides Motions for Summary Judgment arising from Fraudulent Financial Advice and Resultant Mortgage Default: Mauro v Countrywide Home Loans, Inc.
In an October 17, 2011 decision by Justice Warshawsky, the court: 1) denied in part and granted in part both Kaplan’s and Countrywide’s motion for summary judgment to dismiss the complaint; and 2) denied Mauro’s cross-motion for summary judgment against Countrywide. On the advice of Dawson, who held himself out as an experienced financial manager, Mauro mortgaged two previously unencumbered properties for investment purposes. Mauro alleged that she did not receive complete information about the loans, including how the proceeds would be disbursed, and that nothing was explained to her at the closing, where Kaplan was the attorney for Countrywide. Although the HUD-1 Settlement Statements indicated that the proceeds would be distributed to Mauro, all proceeds were delivered to Dawson or entities he controlled, including the defendant BMG. BMG initially made the mortgage payments on both loans but eventually defaulted and Dawson was arrested for grand larceny.
The court denied parts of Kaplan’s motion for summary judgment holding that material issues of fact existed as to: 1) the elements of fraud with respect to whether and for what purpose Kaplan made the representation that the loan funds were to be directed to Mauro alone; 2) breach of fiduciary duty, because while it was unlikely that Kaplan entered into an attorney-client relationship with Mauro by drafting two deeds, it was still a factual possibility; and 3) Countrywide’s cross-claims for professional negligence, breach of contract and indemnity. Kaplan’s motion to dismiss the claim for intentional tort was granted because the actions giving rise to the claim occurred beyond the one-year statute of limitations period.
On Countrywide’s motion, the court held that: 1) there were factual issues precluding the dismissal of the claims for breach of contract and fraud, and Countrywide’s cross-claims against Kaplan that it could be only be liable due to its agent’s (i.e., Kaplan’s) negligence and breach of contract; 2) because Mauro could not establish a likelihood of success on the merits and was seeking economic damages, the claim for injunctive relief was inappropriate and therefore dismissed; 3) the claims seeking a declaration that loans were void because obtained under false pretenses were dismissed because Mauro’s cooperation in their placement established their validity; and 5) because there were no factual issues with respect to Dawson’s criminal wrongdoing through BMG, summary judgment was granted on Countrywide’s cross-claim for indemnification against Dawson and BMG.
Finally, the court denied each part of Mauro’s motion for summary judgment against Countrywide finding that: 1) issues of material fact with respect to the direction of proceeds to BMG precluded the claims for breach of contract, fraud, and declaratory relief; and 2) Mauro had not established a likelihood of success on the merits, precluding injunctive relief.
Mauro v Countrywide Home Loans, Inc., Sup Ct, Nassau County, October 17, 2011, Warshawsky, J., Index No. 000191/2011.
Nothing New to Say; Motion for Leave to Amend Complaint Denied: Verdeber v Commander Enters. Centerreach, LLC
In an October 18, 2011 decision by Justice Warshawsky, the court denied the plaintiffs’ motion to amend the complaint pursuant to CPLR 3025(b) to include claims for breach of contract and waiver with respect to defendant Benco LLC’s (“Benco”) alleged failure to consummate a closing to purchase the plaintiffs’ interest in the defendant Commander Enterprises Centereach, LLC (“CEC”). The defendants opposed the motion asserting that the new claims were without merit, and were based on transactions that were previously resolved by the court and affirmed by the Second Department. The individual plaintiffs were holders of a 20% interest in CEC; Benco owned the remaining 80%. The underlying dispute arose from the individual plaintiffs’ sale of their interests in CEC to the plaintiff company Verbenco, LLC (“Verbenco”). In a prior proceeding, the court held and the Second Department affirmed that an operating agreement from the year 2000 was controlling. Pursuant to the operating agreement, Benco alone was entitled to purchase the interests. Therefore, the court held that the plaintiffs’ attempted transfer to Verbenco terminated their membership in CEC and was an offer to sell their interest, which Benco accepted. In denying the current motion, the court held: 1) that the proposed amended complaint did not raise any “‘additional or subsequent transactions or occurrences’ as mandated by § 3025(b)”; and 2) that it was bound by the prior decision of the Second Department.
Verdeber v Commander Enters. Centereach, LLC, Sup Ct, Nassau County, October 18, 2011, Warshawsky, J, Index No. 00769/09.
Motion to Quash Subponea Granted: Guss v. Aronson
In a September 27, 2011 decision by Justice Warshawsky, the court granted the non-party’s motion to quash a subpoena duces tecum served on it by plaintiffs. Plaintiffs sought discovery of non-privileged information from The Weinstein Group, P.C., a law firm that had previously represented defendant Aronson in unrelated matters. Specifically, plaintiffs sought documents from litigations, which amounted to six identified cases, in which the Weinstein Group “appeared as counsel for Aronson or the Aaronson Companies, or for which. . . the [Weinstein Group] otherwise ha[d] knowledge.” The court found that although compliance with the subpoena “may involve significant time and effort,” as it would require review of all the case files for privilege, this did not make the demand overly broad or unduly burdensome. The court, however, followed Second Department precedent and granted the motion to quash the subpoena because the plaintiffs failed to demonstrate that the materials sought by the subpoena were not available through sources other than the Weinstein Group. The court explained that the subpoena excluded privileged materials, leaving “very little besides the pleadings in the action, which are filed in the Count Clerk’s office in each County in which the proceedings were conducted.” The court noted that it would allow the plaintiffs to re-file the subpoena in the future if they could show that the requested documents were unavailable through other means.
Guss v. Aronson, Sup Ct, Nassau County, September 27, 2011, Warshawsky, J, Index No. 015752/2009.
LLC Member not Entitled to File Notice of Pendency against Property Owned by LLC: Born To Build, LLC v Saleh
In a September 20, 2011, decision by Justice Warshawsky, the court denied plaintiff-contractor’s motion for an order directing the clerk of court to accept and file a notice of pendency and granted defendant-owners’ corresponding motion to preclude the filing of the notice. The court also denied plaintiff’s request for injunctive relief but otherwise denied defendants’ motion to dismiss the complaint under CPLR 3211 [a] [1] based on documentary evidence. Plaintiff performed $2.5 million of construction services for which it was not paid, obtained a judgment, and sought recovery in connection with certain real property owned by defendants. Plaintiff claimed to have acquired an interest in the limited liability company that owned the property and attempted to file a notice of pendency against the property. The court held, however, that under LLCL § 601 membership interest in an LLC “is personal property and does not give a member interest in specific property of the limited liability company” and decided the parties’ lis pendens motions accordingly. The court then denied defendants’ motion to dismiss based on a sworn statement from the LLC member from whom plaintiff allegedly acquired his interest, finding that “the documentary evidence is convincing, but not conclusive on the subject of relationship between [the owners of the property].”
Born To Build v Saleh, Sup Ct, Nassau County, September 20, 2011, Warshawsky, J., Index No. 9558/2011
Small Business Must Litigate Computer Software Dispute in California, Computer Career Center, Inc. v Diamond D, Inc.
In a May 24, 2011 decision by Justice Warshawsky the court granted a motion to dismiss based on a forum selection clause in the parties’ contract which required that the action be brought in California. The dispute arose out of the purchase of computer software by a New York computer training school. After the software was installed it became clear that it was not useable for the purpose for which it was purchased.
The license agreement for the software provided that any litigation must be brought in California. The plaintiff argued that the license agreement was not operative because it timely rejected the software under UCC § 2-206 or in the alternative it would be unreasonable to require it to mount a litigation in California. The court rejected both arguments, finding that the forum selection clause was prima facie valid and the suit was required to proceed in California. The court, nevertheless, declined to award defendant its attorneys fees for the motion finding that the court’s determination on the motion was not a determination that defendant was the prevailing party under the underlying dispute.
Computer Career Center, Inc. v Diamond D, Inc., Sup Ct, Nassau County, May 24, 2011, Warshawsky, J, Index No. 21216/10.
Fraudulent Conveyance Claims Brought Under Debtor and Creditor Law Satisfied the Statutory Requirements and Survived Motion to Dismiss: K.B.K. Huntington Corp. v James Anthony Cleaners
In a May 16, 2011 decision by Justice Warshawsky, the court denied the defendants’ motion to dismiss the complaint pursuant to CPLR § 3211(a)(7), upon finding that the plaintiff adequately pled causes of action pursuant to the Debtor and Creditor Law. The crux of the plaintiff’s complaint, which sought to recover monies from a previously awarded judgment for unpaid rent against the defendant corporation, was that during the pendency of the action, the wife of the corporation’s principal formed a new entity and transferred the corporations’ assets thereto, rendering the defendant corporation incapable of paying the judgment. In denying the motion, the court determined that the plaintiff properly pled the causes of action for fraudulent conveyances under sections 276, 273-a, 273, and 275 of the Debtor-Creditor law, because the complaint alleged that the defendants transferred the funds in order to hinder or delay the plaintiff from collecting on its judgment and rendered the defendant unable to satisfy the judgment, and were not subject to the heightened pleading requirements of CPLR §3016(b). The court also found that, while there is no separate cause of action for piercing the corporate veil, it held that dismissal of the allegations regarding veil-piercing—that the defendants abused the corporate form in order to perpetrate a fraud upon the plaintiff—was not required because those facts were sufficient to entitle the plaintiff to the relief sought on its other claims.
K.B.K. Huntington Corp. v James Anthony Cleaners, Inc., Sup Ct, Nassau County, May 16, 2011, Warshawsky, J, Index No. 005150/08
Action Against Swimming Pool Installer For Defective Installation is Dismissed: Rush v. Swimming Pools by Jack Anthony, Inc.
In an April 25, 2011 decision by Justice Warshawsky, the Court granted defendant’s motion to dismiss all six claims asserted, thus dismissing the action. Plaintiffs had contracted with defendant to install a vinyl swimming pool at plaintiffs’ Water Mill home. Ultimately, the pool was constructed, and plaintiffs complained of various defects. Specifically, plaintiffs complained that the pool depth was too shallow, the dimensions of the “low end” were incorrect, the adjacent spa did not spill over correctly, and chipping of the bricks and concrete. Unable to resolve the dispute, plaintiffs sued defendant, asserting six causes of action based upon breach of contract, warranty, negligence, “unlicensed contractor”, and attorneys’ fees under General Obligations Law sec. 5-327.
In considering the parties’ cross motions, the Court found that plaintiffs did not establish that defendant did not substantially perform it obligations under the contract. The Court noted, at the outset, that the depth of the pool was never a term contained in the contract itself, and that the other defects complained of “could certainly have been easily remedied.” As to the unlicensed contractor status, that allegation was contradicted by da copy of the license produced by defendant in response to the motions.
|
|
Court Holds Class Action Challenging Bank's Practices Regarding Gift Card Fees Was Not Preempted by Federal Law: Sheinkin v Simon Prop. Group, Inc.
In a June 28, 2011 decision by Justice Warshawsky, the court denied the defendants’ motion to dismiss a class action which alleged that the defendants engaged in deception and wrongful business practices when it charged monthly “dormancy fees” and an “account closure fee” for purchased gift cards. The defendants specifically asserted that the causes of action for breach of contract, breach of the implied covenant of good faith and fair dealing, indebtedness, unjust enrichment, and violation of GBL § 349 were preempted by federal regulation of banks chartered under the National Bank Act. The court disagreed, noting that several federal courts already addressed that very issue and held that nothing in the federal law preempted general statutes prohibiting deceptive practices. Finding that the National Bank Act does not exclusively regulate national banks and that federal law only preempts those state laws that specifically conflict with the National Bank Act, the court held that the class action complaint alleged claims predicated on state law of general applicability and there was no reason to conclude that GBL § 349 would interfere with the Office of the Comptroller of Currency’s regulation of banking operations.
Sheinkin v Simon Prop. Group, Inc. Sup Ct, Nassau County, June 28, 2011, Warshawsky, J, Index No. 022038/10
Oral Promise of Personal Liability Insufficient to Warrant Default Judgment on Breach of Contract Claim By General Contractor: Born to Build, LLC v Saleh
In a May 18, 2011 decision by Justice Warshawsky, the court granted the plaintiff’s motion to enter a default judgment against a defendant on two construction contracts which the defendant breached by failing to pay general contracting fees. However, the court denied the motion as to a third contract on the grounds that the contract was between the plaintiff and a limited liability company, not the defendant. The court held that it could not pierce the corporate veil to hold the defendant liable. Because the plaintiff failed to establish that the defendant entered into a written agreement to be personally liable for the LLC’s contractual obligations, the court further denied the motion because the defendant’s oral promise to be personally liable was unenforceable under § 5-701(a)(2) of the General Obligations Law and was barred by the statute of frauds.
Born to Build, LLC v Saleh, Sup Ct, Nassau County, May 18, 2011, Warshawsky, J, Index No. 002345/11
Lawyer Who Spent 3.8 Hours Editing a Brief in Support of a Motion to Dismiss Cross-Claims on Behalf of One Defendant Disqualified from Representing Another Defendant in the Same Case: Rodeo Family Enters., LLC v Matte
In a May, 6, 2011, decision by Justice Warshawsky, the court granted one defendant’s motion to disqualify counsel for another defendant among whom cross-claims were pending. The lawyer in question, who worked on a motion to dismiss some of the cross-claims on behalf of the former defendant, later joined a firm who sought to represent the latter defendant in the same case. The court disqualified the lawyer and his new firm, finding that “the information [the lawyer] may have learned during his time on the case to be confidential, inclusive of case strategy and merits to particular claims, defenses, or other allegations.” Because there was a risk that the lawyer had acquired client confidences, the court found that the moving defendant had raised the rebuttable presumption of disqualification, which the lawyer and his new firm failed to rebut.
Rodeo Family Enters., LLC v Matte, Sup Ct, Nassau County, May 6, 2011, Warshawsky, J., Index No. 600378/10
Court Denies Default Motion On Fraud Claim But Suggests Piercing Claim As Alternative: Kin & Ann Realty Inc. v Renzulli
In a March 16, 2010, decision by Justice Warshawsky, the court granted in part and denied in part plaintiff-owner’s motion for default after defendant-contractor failed to answer the complaint. Plaintiff’s action arose out of a contract to construct a building on its property, under which defendant allegedly failed to perform its obligations. Because plaintiff had submitted a signed contract in support of its properly-pleaded allegations of non-performance, the court granted the motion as to plaintiff’s first cause of action for breach of contract. The court, however, denied the motion as to plaintiff’s causes of action for breach of fiduciary duty, conversion, misrepresentation/fraud, and restitution/unjust enrichment as duplicative of the breach of contract claim. Notably, while finding that plaintiff’s fraud claim was insufficiently pleaded, the court nonetheless suggested that the allegations “may provide the grounds for piercing the corporate veil, an avenue that the plaintiff may wish to investigate.” The court also denied the motion as to plaintiff’s consumer protection claim under GBL § 349 for failure to allege any broader impact on consumers at large.
Kin & Ann Realty Inc. v Renzulli., Sup Ct, Nassau County, March 16, 2011, Warshawsky, J., Index no. 601704/2009
Default Judgment Granted and Corporate Veil Pierced: Washington Title Ins. Co. v. Sand Lane Title Agency, LLC
In a February 15, 2011 decision by Justice Warshawsky, the Court granted the motion of plaintiff for a default judgment against two of the defendants. Plaintiff and defendant Sand Lane Title Agency (“Sand Lane”) entered into an agreement in 2005, by which Sand Lane agreed to issue title insurance policies on behalf of plaintiff. Defendant Aleksandr Polyakov was the manager and officer of Sand Lane. Years later, plaintiff sued Sand Lane for breaching the parties’ agreement, namely, by failing to record numerous deeds, mortgages and other instruments, and failing to account for trust funds. Plaintiff alleges that Polyakov exercised complete dominion and control over Sand Lane, and is thus entitled to pierce the corporate veil. Justice Warshawsky found that plaintiff established proper service on defendants, and therefore was entitled to a default. Since plaintiff sought entry of a default judgment on the various claims, i.e., breach of contract, breach of fiduciary duty, conversion, negligence, fraud, indemnification, equitable accounting, constructive trust, injunction, piercing the corporate veil, account stated and attorney’s fees, the court considered each.
After considering the allegations as to each of the claims, the court granted a default on all except for conversion, fraud, indemnity, constructive trust and account stated, and directed the filing of a Note of Issue for an inquest on damages and fees. As to the conversion and constructive trust claims, the court denied the motion since they appeared duplicative of the breach of contract claim. Turning to the fraud claim, the court dismissed that cause of action for lack of particularity required by CPLR 3016. The court next dismissed the indemnity claim on the basis that the parties’ agreement did not provide for the express indemnity sought. Finally, the court dismissed the account stated claim on the ground that there was no evidence of the rendering of accounts with balances due.
Washington Title Insurance Co. v. Sand Lane Title Agency, Sup Ct, Nassau County, February 15, 2011, Warshawsky, J, Index No. 021167/2009.
Default Judgment Denied and Complaint Dismissed Based on Defective Service of Process and Res Judicata: Goldman v Rio
In a February 14, 2011 decision by Justice Warshawsky, the court denied the plaintiff’s motion for a default judgment on the grounds that service of process was defective. The affidavit of service showed that service of process did not comply with CPLR § 308(2), which provides that service may be effectuated by leaving the summons and complaint with a person of suitable age at the actual place of business or dwelling and then mailing the summons and complaint to the person to be served within 20 days thereafter. The court also granted the defendant’s cross-motion to dismiss the complaint based on res judicata. The court found that the complaint contained identical parties and claims for relief as a previously asserted state court action that was dismissed following, and in light of, the plaintiff’s filing of a bankruptcy petition.
Goldman v Rio, Sup Ct Nassau County, February 14, 2011, Warshawsky, J, Index No. 9284/10
Claims By Insured Against Insurance Broker for Late Notice to Carrier Survive Summary Judgment: Sorbara Constr. Corp. v. Romeo
In a December 8, 2010 decision by Justice Warshawsky, the Court considered the parties’ motions for summary judgment in an action brought by a contractor against its retail insurance broker. The action was brought against the broker based upon an excess carrier’s disclaimer of coverage because of late notice. Although defendants did not dispute they had the responsibility to notify the excess carrier, the facts surrounding the communications between the parties was in sharp dispute. The Court first dismissed the claims based on the breach of implied covenant of good faith and fair dealing as duplicative of the contract claims. Next, the Court considered the statute of limitations defense, and whether the doctrine of equitable estoppel tolled the running of the statute. After reviewing the parties’ submissions, the Court held issues of fact indeed existed, and denied defendants’ motion for summary judgment on several claims. Finally, the Court considered the motion for summary judgment to dismiss the Third-Party Complaint, granting the motion in its entirety, concluding that neither claims for indemnity nor contribution existed.
Sorbara Constr. Corp. v. Romeo, Sup Ct, Nassau County, Dec. 8, 2010, Warshawsky, J, Index No. 001238/2008.
Special Referee's Report Concluding Documents Not Privileged or Work Product Upheld: Archstone v. Tocci Bldg.Corp. of N.J., Inc.
In a December 20, 2010 decision by Justice Warshawsky, the Court reviewed the decision of Special Referee, Michael Cardello III, in a construction litigation. Special Referee Cardello concluded that two documents, inadvertently produced by plaintiffs, were not protected either by attorney client or work product doctrine. The documents at issue are the handwritten notes of an employee of one of the defendants. In particular, the employee, an architect, had taken notes at a meeting. A portion of the notes contain, according to the defendant, protocols that were developed with and at the direction of counsel for defendant, and that the meeting was held at the direction of defendant’s counsel. In reviewing the Special Referee’s 19-page decision, as well as the documents at issue, the Court concluded that Mr. Cardello’s determination that the "communication" found within the employee’s notes did not amount to the rendering of legal advice or services. According, the Court, upon, de novo review, affirmed the findings and conclusions of Mr. Cardello and incorporated by reference his decision of November 1, 2010.
Archstone v. Tocci Bldg.Corp. of N.J., Inc., Sup Ct, Nassau County, Dec. 20, 2010, Warshawsky, J., Index No. 001018/08
Failure to Oppose Summary Judgment With Evidence Dooms Reargument Motion: Archstone v Tocci Bldg. Corp. of N.J., Inc.
In at September 23, 2010 decision by Justice Warshawsky the Court granted leave to reargue and adhered to its prior determination granting one of the third-party defendants dismissal of the claims against it. The litigation was brought because water infiltration discovered after the completion of a large apartment complex. The general contractor brought third party claims against of the number of suppliers to the project, including the supplied of prefabricated wood panels.
The wood panel manufacturer moved for summary judgment based on its employee’s affidavits that the panels as fabricated and delivered met all specifications and were fit for their purpose. The affidavit further explained that after delivery the panels were cut and altered by whoever erected the panels at the site. Through this affidavit the third-party defendant submitted admissible evidence that there were no defects in the wall panels.
The Court adhered to its prior finding dismissing the wood panel manufacturer from the suit because (i) the third-party plaintiff general contractor did not claim that there was an actual defect in the wall panels (rather the general contractor only brought a claim-over in the event the general contractor was found liable to the plaintiff) so there was no triable issue of fact on that claim and (ii) the plaintiff failed to adduce any admissible evidence that the wall panels were defective.
Archstone v Tocci Bldg. Corp. of N.J., Inc., Sup Ct, Nassau County, Sept. 23, 2010, Warshawsky, J, Index No. 001018/2008
Attorney's Knowledge of Relevant Facts Does Not Justify Disqualification: Carltun on the Park, Ltd. v Weitzman
In a November 29, 2010 decision by Justice Warshawsky, the court denied the defendants’ motion to disqualify the plaintiff’s counsel. Although it was uncontroverted that the plaintiff’s attorney, who had represented the plaintiff for 15 years, would likely be called as a witness at trial and possessed relevant information concerning the underlying transaction at issue, the court found the attorney’s testimony would be cumulative. Relying on the Court of Appeals’ pronouncement that the mere possession of relevant knowledge alone is insufficient to render the attorney’s testimony necessary, the court concluded that disqualification was not appropriate at that stage of the litigation.
Carlton on the Park, Ltd. v Weitzman, Sup Ct Nassau County, November 29, 2010 Warshawksy, J, Index No. 8035/10
Summary Judgment on a Corporate Guaranty Granted, But Denied as to Personal Guaranty: Colarossi v. Daly
In an August 3, 2010 decision by Justice Warshawsky the Court granted a motion for summary judgment on a corporate guaranty, but denied summary judgment as to a personal guaranty, stemming from the purchase of a truck with a cesspool vacuum tank.
In 2003, both the corporation and its principal guaranteed the monthly payments for the truck; under an agreement that contained an acceleration clause (i.e. if there was a default all of the remaining payments were immediately due). In 2005, the principal lost control over the business and all of its equipment, including the truck. The new business advised the financing company that it had purchase the assets of the old company and began making the monthly payments on the truck. After three years the new business stopped making the monthly payments for the truck and it was repossessed. The financing company then sued the old company and its principal, seeking the difference between the sale price on the repossession and the amount due on the loan (as well as its costs and attorneys’ fees).
The financing company moved for summary judgment on its claims against both the old company and its principal. The Court granted summary judgment against the old company, but denied summary judgment against its principal finding there was an issue of fact whether the transaction whereby the new company took possession of the truck and began making payment on the loan released the principal from his obligations under the guaranty.
Colarossi v. Daly, Sup Ct, Nassau County, August 3, 2010, Warshawsky, J, Index No. 3334/2008
Matter of Cusimano v Strianese Family Ltd. Partnership, Sup Ct Nassau County, October 5, 2010, Warshawsky, J, Index No. 8522/2010
In an October 5, 2010 decision by Justice Warshawsky, the court granted the petitioner’s motion pursuant to CPLR § 3102(c) to compel the depositions of intervening parties in an ongoing arbitration. The court had previously granted the petitioner’s parents, who claimed a 50% ownership in subject partnership, to intervene in dissolution proceedings and arbitrate the entire proceeding. The petitioner contests the intervenors’ ownership rights and sought to depose them in aid of arbitration. In granting the application, the court found that extraordinary circumstances existed to invoke its power to order disclosure in arbitration, which is normally used sparingly because: (1) there were serious conflicting facts concerning the intervenors’ ownership of the partnership, (2) the intervenors were 90 years old and the arbitration had not yet begun, and (3) the test of whether the petitioner had adequate knowledge to frame a claim or defense was satisfied.
Bruno v. Gerber, Sup Ct, Nassau County, Sept. 20, 2010, Warshawsky, J., Index No. 024915/2009
In a September 20, 2010 decision by Justice Warshawsky, the Court granted plaintiffs’ motion, pursuant to CPLR 3217, to discontinue the action, without prejudice, in favor of allowing plaintiffs to litigate the issues in an action pending in the federal district court in the District of New Jersey. The court also granted defendants leave to apply to the Court for an order fixing terms as to statutory costs, disbursements, legal fees and additional expenses incured from the inception of the action to the date of the Order. The case arose out of a failed effort to form a corporation under a Shareholders’ Agreement for the purpose of consolidating the parties' individual companies into a single entity involved in the home mortgage business. Defendants objected to the discontinuance, claiming undue prejudice, which the court rejected.
New York Packaging II, LLC v Peace Prod. Co., Sup Ct, Nassau County, Sept. 10, 2010, Warshawsky, J, index No. 006300/10
In a September 10, 2010, decision by Justice Warshawsky in connection with an action by plaintiff-manufacturer alleging various business torts against defendant-employee, and on defendant’s motion to dismiss under CPLR 3211 [a] [1] and [a] [2], the court 1) denied defendant’s motion based on documentary evidence, finding that the order slips reflecting a pre-existing relationship with plaintiff’s customers submitted by defendant “[did] not even remotely conclusively dispose of plaintiff’s claim”; 2) denied defendant’s motion regarding plaintiff’s claims for breach of fiduciary duty and aiding and abetting a breach of fiduciary duty, finding that the pleading was adequate despite the fact that “specifics [were] not included in the complaint” and that certain supporting allegations were “to say the least, minimal”; 3) denied defendant’s motion regarding plaintiff’s claim for unfair competition, finding that the pleading was sufficient “despite the apparent lack of an employment agreement with a non-compete clause”; 4) denied defendant’s motion regarding plaintiff’s claim for unjust enrichment; 5) granted defendant’s motion regarding plaintiff’s claim for fraud, finding that plaintiff failed to allege the various elements of a fraud claim under the heightened requirements of CPLR 3016; and 6) granted defendant’s motion regarding plaintiff’s claim for injunctive relief, finding that “[w]hen money damages can make the plaintiff whole, injunctive relief is not appropriate.” The court also struck plaintiff’s claim for punitive damages, finding that “[t]he allegations of the complaint fall far short of the high degree of moral culpability, or willful or wanton negligence indicating a conscious disregard for the rights of others.” Finally, the court struck plaintiff’s claim for attorney’s fees, finding that claims for breach of fiduciary duty and unjust enrichment are not among the exceptions to the general rule in New York that “each party is to bear its own legal expenses.”
SRG Properties, LLC v. Long Island Power Authority, Sup Ct, Nassau County, May 20, 2009, Warshawsky, J, Index No. 019866/08
In a May 20, 2009 decision, Justice Warshawsky granted LIPA’s motion to dismiss an Article 78 proceeding brought by a LIPA “ratepayer” challenging LIPA’s imposition of a “Power Supply Surcharge”. The ratepayer sought to have LIPA enjoined from continuing to impose the surcharge and an order compelling LIPA to seek approval of the rate increase from the Public Service Commission, as well as seeking monetary damages.
The Court dismissed the action on numerous grounds, including the fact that the petitioner did not suffer an injury separate from that of the general public.
Arbor Secured Funding, Inc. and Arbor Management, LLC v. Just Assets NY 1, et al., Supreme Court, Nassau Count Index No. 012550/2004 (Nov. 19, 2008)
In a November 19, 2008 decision, Justice Warshawsky partially granted defendants’ motion to amend its answer to assert additional counter claims, cross claims and third-party claims in an action stemming from the sale of tax deed.
The court partially granted defendants’ motion finding that the opposing parties failed to establish that significant prejudice would result from the amendment or that the statute of limitations had run on certain of the claims.
Nevertheless, the court did deny the motion to amend as to certain new parties finding that there could not be a relation back to the filing of the original answer and counterclaims and because the new parties were not united in interest with the original parties to the action. Last, the court found that it could not at this juncture in the litigation determine the scope of a general release provided to certain of the parties, allowing those claims to go forward.
