Opinion
Index No. 115209/2010
10-22-2012
In the Matter of the Application of AVANT GUARD PROPERTIES, LLC Petitioner, v. THE CITY OF NEW YORK, NEW YORK CITY INDUSTRIAL DEVELOPMENT AGENCY, NEW YORK CITY ECONOMIC DEVELOPMENT CORPORATION, and SETH PINSKY, in his Official Capacity as Chair of the New York City Industrial Development Agency and President of the New York City Economic Development Corporation, Respondents. AVANT GUARD, INC., BARRY BORGEN, PAUL ROUHANI, and ZADOK ZVI, Additional Counterclaim Respondents.
Motion seq.nos.: 003, 004, 005, 006
DECISION & ORDER
BARBARA JAFFE, JSC:
For petitioner/Borgen/Zvi:
Ann G. Kayman, Esq.
For NYCIDA:
Leonard M. Braman, ACC
Michael A. Cardozo
By notice of motion dated January 17, 2012, NYCIDA moves pursuant to CPLR 3212 for an order granting it summary judgment on its counterclaims and dismissing the complaint. Petitioner Avant Guard Properties, Inc. and counterclaim respondents Avant Guard, Inc., Borgen, and Zvi oppose.
By notice of motion dated January 17, 2012, NYCIDA moves pursuant to CPLR 3215 for an order granting it a default judgment against counterclaim respondent Zvi. Zvi opposes.
By notice of motion dated January 17, 2012 and submitted on default, respondent/ counter-claimant New York City Industrial Development Agency (NYCIDA) moves pursuant to CPLR 3215 for an order granting it a default judgment against counterclaim respondent Rouhani, and pursuant to CPLR 102, for an order amending the caption.
The motions are consolidated for decision.
I. MOTION FOR SUMMARY JUDGMENT
The parties' submissions raise triable issues as to whether petitioner and counterclaim respondents Avant Guard, Inc., Borgen, and Zvi defaulted under their lease and/or breached, their contracts with NYCIDA by improperly altering the use of the premises at issue when they installed a gym on the premises, and by illegally subletting the premises and failing to make payments timely, and whether NYCIDA is thus entitled to damages upon its termination of the parties' lease. No discovery has yet been conducted.
II. MOTION FOR A DEFAULT JUDGMENT AGAINST ZVI
While Zvi's verification of his reply to NYCIDA's counterclaims is untimely, NYCIDA has it and has demonstrated no resulting prejudice from the delay. (Kommeh v City of New York, 96 AD3d 476 [1st Dept 2012]; D&R Global Selections, S.L. v Pineiro, 90 AD3d 403 [1st Dept 2011]). Moreover, there is a preference for resolving actions on the merits, and as triable issues exist as to whether NYCIDA is entitled to judgment on its counterclaims (see supra, I), Zvi has established a meritorious defense. (See Med Facilities, Inc. v Pryke, 172 AD2d 338 [1st Dept 1991] [merits of plaintiff's claim demonstrated by denial of defendant's summary judgment motion]).
III. MOTION FOR A DEFAULT JUDGMENT AGAINST ROUHANI
NYCIDA has demonstrated that it properly served Rouhani with its verified answer with counterclaims and that Rouhani failed to appear or answer timely. However, its investigation as to Roubani's military status was conducted before the default, and thus, the motion for a default judgment may not be granted absent a military affidavit reflecting a post-default investigation as to his military status. (8B Carmody-Wait 2d § 63:181 [2010] [affidavit must be based on investigation after default]; Sunset 3 Realty v Booth, 12 Misc 3d 1184[A], 2006 NY Slip Op 51441[U] [Sup Ct, Suffolk County 2006]; US, Bank v Coaxum, 2003 WL 22518107, 2003 NY Slip Op 51384[U] [Sup Ct, Westchester County]; Citibank, N.A. v McGarvey, 196 Misc 2d 292 [Civ Ct, Richmond County 2003]). Moreover, as discussed above, triable issues exist as to the merits of NYCIDA's counterclaims. (See supra, I).
IV. AMENDMENT OF CAPTION
The parties have stipulated to amend the caption to reflect that this proceeding, originally commenced as an Article 78 proceeding, is now solely a plenary action for damages and declaratory relief. Moreover, they agree that petitioner, now plaintiff, will discontinue the action against all defendants other than NYCIDA, and that the notice of petition will be converted to and deemed a summons.
V. CONCLUSION
Accordingly, it is hereby
ORDERED, that respondent/counterclairnant New York City Industrial Development Agency's motion for summary judgment is denied (sequence no. 006); it is further
ORDERED, that respondent/counterclaimant New York City Industrial Development Agency's motion for a default judgment against counterclaim respondent Zadok Zvi is denied (sequence no. 005); it is further
ORDERED, that that respondent/counterclaimant New York City Industrial Development Agency's motion for a default judgment against counterclaim respondent Paul Rouhani is denied without prejudice to renew (sequence no. 003); it is further
ORDERED, that that respondent/counterclaimant New York City Industrial Development Agency's motion to amend the caption is granted (sequence no. 004); it is further
ORDERED, that all papers, pleadings, and proceedings in the above-entitled action be amended by: (1) substituting Avant Guard Properties, LLC as the plaintiff for Avant Guard Properties, LLC as the petitioner, (2) substituting New York City Industrial Development Agency as the defendant for New York City Industrial Development Agency as the respondent, (3) substituting Avant Guard, Inc., Barry Borgen, Paul Rouhani, and Zadok Zvi as additional counterclaim defendants for Avant Guard, Inc., Barry Borgen, Paul Rouhani, and Zadok Zvi as additional counterclaim respondents, (4) removing The City of New York, New Yor kCity Economic Development Corporation, and Seth Pinsky as respondents from the caption and action, and (5) converting the notice of petition to and deeming it to be a summons, without prejudice to the proceedings heretofore had herein; it is further
ORDERED, that counsel for plaintiff shall serve a copy of this order with notice of entry upon the County Clerk (Room 141B) and the Clerk of the Trial Support Office (Room 158), who are directed to amend their records to reflect such change in the caption herein; and it is further
ORDERED, that the matter is referred to the Case Management Office for the scheduling of a preliminary conference.
ENTER:
________
Barbara Jaffe, JSC
DATED: October 18, 2012
New York, New York