Opinion
Index No. 651073/2018 Motion Seq. Nos. 004 005
05-06-2022
HUAJUN "COCO" HAN, Plaintiff, v. FRED CHEN A/K/A FRED YU-YUET CHEN A/K/A FRED YU YUET CHEN A/K/A FRED YUYUET CHEN A/K/A FRED Y. CHEN, HEDDY CHEN A/K/A HEDDY ZEE CHEN A/K/A HEDDY ZHEE WEN CHEN A/K/A HEDDY ZEE-WEN CHEN A/K/A HEDDY ZEEWEN CHEN A/K/A HEDDY Z. CHEN, WILLIAM CHEN, FORD CHEN Defendants.
Unpublished Opinion
MOTION DATE 03/31/2021
DECISION+ ORDER ON MOTION
JOEL M. COHEN, J.S.C.
The following e-filed documents, listed by NYSCEF document number (Motion 004) 132, 133, 134, 135, 136, 137, 138, 139, 140, 141, 142, 143, 144, 145, 146, 147, 148, 149, 150, 151, 152, 153, 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, 200, 201, 202, 203, 204, 205, 206, 207, 208, 209, 210, 211, 212, 213, 230, 232, 233, 234, 235, 236, 237, 238, 239, 240, 241, 242, 243, 244, 245, 246, 247, 248, 249, 250, 255, 257, 260, 261, 262 were read on this motion for SUMMARY JUDGMENT The following e-filed documents, listed by NYSCEF document number (Motion 005) 214, 215, 216, 217, 218, 219, 220, 221, 222, 223, 224, 225, 226, 227, 228, 229, 231, 251, 252, 253, 254, 256, 258, 259 were read on this motion for SUMMARY JUDGMENT
In this action, Plaintiff Hua Jun "Coco" Han seeks to recover a total of $1,100,000 that she paid to defendants Fred and Heddy Chen (collectively, the Chens), who allegedly sold to Plaintiff counterfeit Chinese "antiques" as well as overpriced and undelivered cemetery lots. Plaintiff asserts eight causes of action against the defendants, and seeks punitive damages in connection with her second cause of action for fraudulent inducement. Defendants, meanwhile, assert counterclaims against Plaintiff for breach of a lease agreement and breach of a bailment contract.
Both sides now move for summary judgment on their respective claims, and the motions are consolidated for disposition. In motion sequence no. 004, plaintiff moves, pursuant to CPLR 3212, for partial summary judgment on the first, third, fourth, fifth, sixth, and seventh causes of action in her second amended complaint, as well as summary judgment dismissing defendants' counterclaims with prejudice. Plaintiffs motion is denied.
In motion sequence no. 005, defendants move for partial summary judgment dismissing a portion of plaintiff s first cause of action, as well as dismissing the second, third, fourth, fifth, sixth and seventh claims, together with plaintiffs claim for punitive damages. Defendants' motion is granted.
DISCUSSION
"' [T]he proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact'" (Ayotte v Gervasio, 81 N.Y.2d 1062, 1063 [1993] [citation omitted]; Winegrad v New York Univ. Med. Ctr., 64 N.Y.2d 851 [1985]). The burden is a heavy one: the facts must be viewed in the light most favorable to the non-moving party and every available inference must be drawn in the non-moving party's favor (Sherman v New York State Thruway Auth., 27 N.Y.3d 1019, 1021 [2016]). "Failure to make such showing requires denial of the motion, regardless of the sufficiency of the opposing papers" (Winegrad, 64 N.Y.2d at 853; see also Lesocovich v 180 Madison Ave. Corp., 81 N.Y.2d 982 [1993]).
The party opposing summary judgment has the burden of presenting evidentiary facts sufficient to raise triable issues of fact (Zuckerman v City of New York, 49 N.Y.2d 557, 562 [1980]; Citi Financial Co. [DE] v McKinney, 27 A.D.3d 224, 226 [1st Dept 2006]). The court is required to examine the evidence in a light most favorable to the party opposing the motion (Martin v Briggs, 235 A.D.2d 192, 196 [1st Dept 1997]). Summary judgment should not be granted if there are genuine material issues of disputed fact (Sillman v Twentieth Century-Fox Film Corp., 3 N.Y.2d 395, 404 [1957]; Tronlone v Lac d'Amiante Du Quebec, 297 A.D.2d 528, 528-529 [1st Dept 2002], affd 99 N.Y.2d 647 [2003]).
A. Breach of Oral Contract to Sell Antiques (First Cause of Action)
Both parties move for summary judgment on the first branch of the first cause of action for breach of an oral contract to sell antiques.
The elements of a breach of contract claim are "the existence of a contract, the plaintiffs performance thereunder, the defendant's breach thereof, and resulting damages" (Harris v Seward Park Hous. Corp., 79 A.D.3d 425, 426 [1st Dept 2010]; see also Second Source Funding, LLC v Yellowstone Capital, LLC, 144 A.D.3d 445, 446 [1st Dept 2016]).
In support of her motion for summary judgment, plaintiff contends that she and the Chens entered into an oral contract for the sale of certain antiques, and that defendants breached this contract by supplying fake or counterfeit antiques of little value.
In opposition to plaintiffs motion, and in support of their own motion for summary judgment dismissing this cause of action, defendants dispute that they entered into a contract for the sale of the Chinese antiques (see defendants' response to PSMF [NYSCEF Doc No. 249], ¶¶ 54-94). Defendants further contend that, even if they had entered into such a contract, plaintiff is required to present some expert testimony supporting the claim that the disputed items were counterfeits in order to assert a viable claim for breach of contract.
Under New York law, expert testimony is necessary to prove the authenticity (or lack thereof) of artwork (see Nussberg v Tatintsian, 111 A.D.3d 441, 441 [1st Dept 2013] ["The motion court correctly determined that expert testimony is required to identify and authenticate the works of art; specifically, the testimony of an expert who viewed the consigned works before they left the United States in 2009 and who can testify that they were forgeries when they left and were forgeries on their return. This is consistent with how art work and forgeries are identified, authenticated and detected"]; see also United States v Burke, 718 F.Supp. 1130, 1137 [SD NY 1989] ["given the specialized nature of the question here-whether certain prints were forgeries or not-I question how the government could establish the elements of the crime without the assistance of art experts"]).
During discovery, plaintiff did not identify any expert witnesses on this issue. In connection with this motion, she now submits the affidavit of Mr. Lin Li, an owner and operator of Time Antiques & Auction Inc. Mr. Li asserts that the antiques sold by the Chens to plaintiff were all imitations based on his personal observation and his 27 years of experience dealing in porcelain antiques of the Ming and Qing Dynasties and gold and silver coins of the early Republic of China (Lin Li aff [NYSCEF Doc No. 205], ¶¶| 3-4, 7-9). Defendants point out that Mr. Li did not supply an expert report, and was not subject to discovery as an expert witness in accordance with Rule 13 (c) of the Rules of the Commercial Division of the Supreme Court, 22 NYCRR § 202.70. That Rule provides that a party who fails to timely provide the required disclosure shall be precluded from using the expert's testimony at trial, absent a showing of good cause. Defendants argue, correctly, that these failings require dismissal of plaintiff s claim.
Plaintiffs failure to identify an expert witness in accordance with the Commercial Division rules is fatal to her claim that the antiques were fake, as is more fully discussed in connection with plaintiffs fraudulent inducement claim. Accordingly, the branch of the first cause of for breach of an oral contract to purchase antiques is dismissed.
In any event, plaintiff now takes the position that the cause of action for breach of an oral contract to purchase the antiques is superseded by her claim that defendants breached an oral contract for the return of the antiques: "Plaintiffs return and Defendants' acceptance of the return have mooted the issue as to whether they were fake or genuine because the Chens agreed to refund the purchase money to Plaintiff. As such, Plaintiff is not required to provide disclosure pursuant to CPLR 3101(d) (1) (i)" (plaintiffs reply memorandum [NYSCEF Doc No. 262], at 11; see also transcript of 12/20/21 oral argument [NYSCEF Doc No. 263], at 9 (plaintiffs lawyer stated that "the return has the legal significance of terminating the first contract and starting the second contract [to return the antiques]").
B. Breach of Oral Contract for the Return of Certain Chinese Antiques (First Cause of Action)
Plaintiff moves for summary judgment on this second branch of the first cause of action. Defendants do not move with respect to this cause of action.
In support of her motion for summary judgment, plaintiff argues that her documentary evidence in the form of cashed checks, photographs, and the parties' text messages sufficiently demonstrate the absence of any material issues of fact as to (1) the existence of an oral agreement between plaintiff and the Chens to buy and sell antiques, (2) plaintiffs performance of the terms of the agreement by her payments, (3) plaintiffs return of the antiques as fake, (4) the Chens' acceptance of plaintiff s return of the antiques, (5) the Chens' partial repayment to plaintiff, and (vi) the Chens' refusal to repay the full purchase money paid by plaintiff.
However, defendants have raised genuine issues of material fact precluding summary judgment in favor of plaintiff. During her deposition, Heddy Chen specifically disputed plaintiffs version of the events, and testified that the Chens only agreed to lend the antiques to plaintiff, that plaintiff did not return the items, that she did not agree to accept the antiques for return, and that there was no agreement to refund plaintiff (see 2/20/20 Heddy Chen dep [NYSCEF Doc No. 235], at 28; 2/26/20 Heddy Chen dep [NYSCEF Doc No. 236], at 139-140, 153-165, 179-212, 237-249; 3/11/20 Heddy Chen dep [NYSCEF Doc No. 237], at 7-35, 48-63).
This testimony indicates that, although the parties agree that plaintiff and the Chens entered into some sort of transaction regarding the items at issue in this case, they fundamentally disagree about the nature of the transaction. Accordingly, the parties' sharply conflicting versions of the relevant facts present issues of credibility that must be resolved by the factfinder, thus precluding summary judgment (see Melendez v Alliance Hous. Assocs., L.P., __A.D.3d__, 156 N.Y.S.3d 736, 737 [1st Dept 2022]; Sanyangv Davis, 198 A.D.3d 522, 522 [1st Dept 2021]; Dunn v New Lounge 4324, LLC, 180 A.D.3d 510, 510 [1st Dept 2020]).
Accordingly, plaintiffs motion for summary judgment on this branch of the first cause of action is denied.
C. Fraudulent Inducement (Second Cause of Action)
Defendants move for summary judgment dismissing plaintiffs second cause of action- that the Chens fraudulently induced plaintiffs purchase of certain Chinese antiques by misrepresenting their authenticity-on the ground that plaintiff, who bears the burden of proof, cannot prove two essential and necessary elements of a cause of action for fraudulent inducement under New York law: falsity and justifiable reliance (see e.g., Ambac Assur. Corp. v Countrywide Home Loans, Inc., 151 A.D.3d 83, 85 [1st Dept 2017] ["(f)o establish fraud, a plaintiff must show 'a misrepresentation or a material omission of fact which was false and known to be false by [the] defendant, made for the purpose of inducing the other party to rely upon it, justifiable reliance of the other party on the misrepresentation or material omission, and injury'"] [citation omitted], affd 31 N.Y.3d 569 [2018]).
Defendants are correct that plaintiff has not provided evidence sufficient to create a triable issue of fact as to whether the items plaintiff allegedly purchased were counterfeits. As noted above, expert testimony is indispensable to establishing such a claim with respect to artwork (Nussberg v Tatintsian, 111 A.D.3d 441, 441 [1st Dept 2013]). Plaintiff did not disclose any expert witness on this issue during discovery and did not show good cause for failing to do so as required by Commercial Division Rule 13 (c), 22 NYCRR 202.70, as well as scheduling orders issued during this litigation setting forth deadlines for conducting expert discovery. This failure deprived defendants of the opportunity to examine plaintiff s purported expert or retain one of their own in rebuttal. Consideration of Mr. Li's untimely and insufficient affidavit at this stage would thus be prejudicial to defendants and would leave a one-sided factual record in which plaintiffs purported expert testimony could not effectively be challenged. In sum, Mr. Li's affidavit is insufficient to warrant holding this claim over for trial (see Colucci v Stuyvesant Plaza, Inc., 157 A.D.3d 1095, 1098 [3d Dept 2018] [finding that where the plaintiff failed to comply with the court's deadlines for expert disclosure, "we cannot conclude that Supreme Court abused its discretion in precluding plaintiffs from submitting the expert affidavits and opinions of [proposed expert witnesses] in opposition to defendant's motion and at trial"]).
To the extent Framan Mech. Inc. v Dormitory Auth. of the State of N.Y.(63 Misc.3d 1218[A], 2019 NY Slip Op 50583[U], * 7-9 [Sup Ct, Albany County 2019]) suggests that courts must in all cases consider affidavits from previously undisclosed experts on summary judgment, and it is not clear that it does, the Court declines to follow it on the facts presented here. Given that expert testimony is indispensable to proving plaintiffs cause of action, it would make little sense to consider such testimony for purposes of summary judgment when it would plainly be inadmissible at trial under the Commercial Division Rules (at which point a directed verdict would be required).
As such, this cause of action must be dismissed, and it is unnecessary to address defendants' arguments as to justifiable reliance.
D. Breach of Oral Contract for Sale of Two Cemetery Plots (Third Cause of Action)
Plaintiff moves for summary judgment on her third cause of action for breach of an oral agreement involving the sale of two cemetery plots. Defendants move for summary judgment dismissing this cause of action.
In support of her motion for summary judgment, plaintiff argues that her documentary evidence (cashed checks, photographs, and the parties' text messages), as well as defendants' deposition testimony, sufficiently demonstrate a prima facie case as to (1) the making of an oral agreement between Fred Chen to and plaintiff to buy two cemetery lots for $120,000, (2) plaintiffs full payment of the $120,000 to defendants, (3) defendants' affirmative conduct in meeting with the cemetery management for the transfer of titles and signing title transfer related documents, (4) defendants' assurance to execute final transfer deeds when the weather became warmer, and (5) defendants' breach of the sale agreement by refusing to sign and return the transfer deeds to the cemetery.
Defendants dispute that the Chens agreed to sell plaintiff two cemetery plots (see defendants' response to PSMF, ¶¶ 142-74). In any event, as plaintiff admits, the contract she alleges that she entered into with the Chens was purely oral (see plaintiffs dep [NYSCEF Doc No. 227], at 304-307). Defendants argue that, as a result, it is void under the applicable statute of frauds, General Obligations Law (GOL) § 5-703(2), which states that a contract for the sale of an interest in real property is unenforceable where there is no written "note" or "memorandum" of the agreement "subscribed by the party to be charged" and "expressing the consideration." Cemetery plots are regarded as real property subject to the statute of frauds set forth in GOL § 5-703 (2) (see Maalin Bakodesh Socy., Inc. v Lasher, 301 A.D.2d 634, 634-35 [2d Dept 2003] [holding agreement for sale of burial plots unenforceable under applicable statute of frauds, GOL § 5-703 (2), because of absence of price term]).
Although she specifically testified that no portion of the purported agreement, including, but not limited to, the price, was in any way memorialized in a writing of any kind, plaintiff now argues that a pair of forms, two checks, and a short series of text messages between her and Heddy Chen are sufficient to demonstrate the existence of an enforceable contract.
However, the text messages-as opposed to emails, which may in some cases be sufficient to satisfy the statute of frauds (see e.g. Naldi v Grunberg, 80 A.D.3d 1, 6-7 [1st Dept 2010])-do not satisfy the mandate that the writing memorializing an oral contract be "subscribed," i.e., signed, "by the party to be charged," i.e., the Chens (see e.g. Hershkowitz v Think Tech Labs, LLC, 2015 WL 13016357, * 8 [SD NY 2015] [holding text message conversation fails statute of frauds subscription requirement "because it does not contain a signature of either [defendant] or Plaintiff], affirmed in part and vacated in part on other grounds, 651 Fed.Appx. 15 [2d Cir 2016]; see also Truman v Brown, 434 F.Supp.3d 100, 114 [SD NY 2020]; Bayerische Landesbankv 45 John St. LLC, 102 A.D.3d 587, 587 [1st Dept 2013]; Leist v Tugendhaft, 64 A.D.3d 687, 688 [2d Dept 2009]; Page v Muze, Inc., 270 A.D.2d 401, 402 [2d Dept 2000]; LIF Industries, Inc. v Fuller, 2015 NY Slip Op 32973[U], ** 12-13 [Sup Ct, NY County 2015]).
Further, although signed and unsigned writings may be read together for purposes of the statute of frauds (see Crabtree v Elizabeth Arden Sales Corp., 305 NY 48, 54 [1953]), they must clearly refer to the same subject matter or transaction, contain all of the essential terms of a binding contract, and the unsigned writing must be prepared by the party to be charged (see Bent v St. John's Univ., New York, 189 A.D.3d 973, 974 [2d Dept 2020]; Knapp v Maron, 2015 WL 2452409, * 3, 2015 U.S. Dist LEXIS 67372 [SD NY 2015]; Post Hill, LLC v E. Tetz & Sons, Inc., 122 A.D.3d 1126, 1127 [3d Dept 2014]).
Moreover, in order to satisfy the statute of frauds, the writing must sufficiently state all the material and essential terms of a complete agreement (Nemelkar v Questor Mgt. Co., LLC, 40 A.D.3d 505, 505 [1st Dept 2007]), such as the "price, identity of the parties, and the parcel of real estate to be sold" (Argent Acquisitions, LLC v First Church of Religious Science, 118 A.D.3d 441, 444 [1st Dept 2014]), the closing date and medium of payment (see Ferchaw v Troxel, 112 A.D.3d 1310, 1312 [4th Dept 2013]; Sabetfard v Djavaheri Realty Corp., 18 A.D.3d 640, 641 [2d Dept 2005]), and "the quality of title to be conveyed, adjustments for taxes and risk of loss" (Argent Acquisitions, LLC, 118 A.D.3d at 444).
Accordingly, a writing purporting to memorialize an oral contract is inadequate where, as here, it lacks language indicating an intent to be bound (see Nesbitt v Penalver, 40 A.D.3d 596, 597-598 [2d Dept 2007]; Eichorn v Eichorn, 2018 NY Slip Op 30111[U], ** 8 [Sup Ct, NY County 2018]), and where, as here, it lacks language indicating assent on all essential terms of a complete agreement in the nature of a real estate transaction, e.g., price, payment, closing date, and risk of loss (see e.g. Nesbitt, 40 A.D.3d at 597-98 [letters between prospective purchaser and vendor's attorney failed to satisfy statute of frauds, where although letters identified parties, described parties, described property, and indicated proposed purchase price, they failed to set forth manner of payment and financing, closing date, quality of title to be conveyed and allocation of risk of loss]; Coston v Greene, 2018 NY Slip Op 32343 [U], ** 8-9 [Sup Ct, Kings Country 2018] [finding that text message "fails to describe the subject property with the degree of certainty necessary to satisfy the Statute of Frauds," because it "refers only to 'the house' and makes no reference to real property or land," [and] no property street address is stated in the text message, nor does it set forth dimensions, acreage, metes and bounds, or lot number"]), or it otherwise fails to set forth the '"full intention'" of the parties without recourse to parol evidence (see Dahan v Weiss, 120 A.D.3d 540, 542 [2d Dept 2014]).
Plaintiff argues that the following documents sufficiently satisfy the writing requirements for the statute of frauds: (1) the Application for Approval to Transfer Cemetery Property signed and acknowledged by Fred Chen on February 20, 2017 (NYSCEF Doc No. 159); (2) the Lost Deed Affidavit signed and acknowledged by Fred Chen on February 20, 2017 (id.); (3) two checks cashed by defendants identifying plaintiffs payment for the two lots (NYSCEF Doc No. 155), and (4) Fred Chen's handwritten notes on the cemetery map identifying the locations of the two lots (NYSCEF Doc No. 156). These documents do not satisfy the statute of frauds.
With respect to the cemetery map, plaintiff presents no evidence that the handwritten notes were written by Fred Chen, the party to be charged. In any event, nothing in this document evidences any intention to be bound. Second, the two checks submitted by plaintiff in the amount of $100,000 that were endorsed by Fred Chen contain no indication that such checks were for the purchase of the cemetery plots. Finally, the application for approval to transfer and the lost deed affidavit, although both signed by Fred Chen, do not contain the $120,000 price term that plaintiff alleges she paid, or any other terms of the alleged agreement, such as the medium of payment or the closing date. Moreover, these forms do not reflect an agreement between plaintiff and defendants to sell the cemetery plots; rather these are clearly only forms that the owner of a plot submits to the cemetery for approval.
Thus, although "the statutorily required writing need not be contained in one single document, but rather may be furnished by 'piecing together other, related writings'" (William J. Jenack Estate Appraisers & Auctioneers, Inc. v Rabizadeh, 22 N.Y.3d 470, 477 [2013] [citation omitted]), even taken together, these various writings are insufficient to memorialize the existence of an agreement by which the defendants were to sell plaintiff two cemetery plots for $120,000.
Plaintiff next argues that the alleged contract is enforceable under the partial performance exception in GOL § 5-703 (4), which states that "[n]othing contained in this section abridges the powers of courts of equity to compel the specific performance of agreements in cases of part performance." Plaintiff argues that she fully performed the terms of the oral agreement to purchase the cemetery lots by paying defendants $120,000. However, GOL § 5-703 (4) only applies in cases where the court, acting in equity, is asked to compel specific performance of the agreement at issue. The exception does not apply where, as here, the plaintiff seeks money damages, which is a remedy at law (see e.g. Zito v County of Suffolk, 106 A.D.3d 814, 815-16 [2d Dept 2013]). In this action, plaintiff does not seek, and never previously sought, specific performance of the agreement she says she entered into with the Chens for the sale of two cemetery plots.
Accordingly, the third cause of action is dismissed for failure to comply with the statute of frauds.
E. Unjust Enrichment and Money Had and Received (Fourth, Fifth, Sixth, and Seventh Causes of Action)
Both parties move for summary judgment on unjust enrichment and money had and received causes of action.
In her fourth and fifth causes of action for unjust enrichment and money had any received against the Chens, plaintiff alleges that "Fred Chen and Heddy Chen received a total of $980,000 from Plaintiff through fraudulent inducement to sell to Plaintiff fake and counterfeit Chinese antiques" (second amended complaint, ¶¶ 83, 87). In her sixth and seventh causes of action for unjust enrichment and money had and received against William and Ford Chen, plaintiff alleges that "William Chen received a total of $160,000 from Plaintiff through Fred Chen and Heddy Chen's fraudulent inducement" (id., ¶¶90, 98), and that "Ford Chen received a total of $360,000 from Plaintiff through Fred Chen and Heddy Chen's fraudulent inducement to sell Plaintiff fake and counterfeit Chinese antiques" (id., ¶¶91, 99).
These claims are based on the same allegations and seek the same damages as the failed fraudulent inducement claim (see second amended complaint, ¶¶ 67- 73, 83-85, 87-88, 90-96, 98-102). Accordingly, plaintiffs unjust enrichment and money had and received claims are precluded as duplicative (see American Mayflower Life Ins. Co. of N.Y. v Moskowitz, 17 A.D.3d 289, 293 [1st Dept 2005] ["The court was correct in dismissing the twelfth and thirteenth causes of action for unjust enrichment and money had and received. They are duplicative of the sixth cause of action to the extent they allege underlying fraud"]; Higher Educ. Management Group, Inc. v Aspen University Inc., 2014 NY Slip Op 32106[U], * 4 [Sup Ct, NY County 2014] ["Aspen's money lent, money had and received, and unjust enrichment causes of action are precluded as duplicative, as these claims assert the same underlying facts and damages as the fraud claim"]; Marini v Adamo, 644 Fed.Appx. 33, 35-36 [2d Cir 2016] [dismissing "plaintiffs' common law claims of unjust enrichment and money had and received, for those claims were duplicative of the common law fraud . . . claim[]"]; see also Corsello v Verizon New York, Inc., 18 N.Y.3d 777, 791 [2012] ["an unjust enrichment claim cannot remedy" an otherwise defective tort claim]).
Accordingly, the fourth, fifth, sixth and seventh causes of action are dismissed.
F. Punitive Damages
Given that her fraudulent inducement claim is being dismissed, plaintiffs punitive damages "claim" (which is not really a claim, but instead a remedy) must be dismissed as well, as plaintiffs remaining causes of action sound in breach of contract, for which punitive damages generally are not available (see e.g. Rocanova v Equitable LifeAssur. Soc. of U.S., 83 N.Y.2d 603, 613 [1994]). Plaintiff does not dispute this point (see plaintiffs opposition memorandum [NYSCEF Doc No. 254], at 22 ["Plaintiff concedes to the legal authority relied on by Defendants and respectfully submits that in the event the Court dismisses the second cause of action against Fred and Heddy Chen for fraudulent inducement, Plaintiff will not be entitled to the award of punitive damages in this action"]).
G. Defendants' Counterclaims
Plaintiff also moves for summary judgment dismissing defendants' two counterclaims for breach of a lease agreement, and breach of a bailment contract. These counterclaims are based on the allegations that, beginning in 2015, the Chens lent approximately 100 antiques to plaintiff for the purpose of having them displayed in her home until such time as they asked her to return them (answer, ¶ 119); that plaintiff received the antiques and agreed to provide the Chens with a cash security totaling "$1,080,000" (id., ¶ 120); that the Chens demanded that plaintiff return their antiques "on a number of occasions, but each time plaintiff refused and failed to do so" (id., ¶ 121); and that the estimated fair market value of the antiques is approximately $22,000,000 (Id.. ¶ 124).
Plaintiff argues that the court should dismiss defendants' first counterclaim for breach of lease agreement as a matter of law pursuant to the statute of frauds, Uniform Commercial Code (UCC) § 2-A-201, because the lease agreement is not in writing signed by plaintiff or her authorized agent.
UCC § 2-A-201 provides that:
"(1) A lease contract is not enforceable by way of action or defense unless:
(b) there is a writing, signed by the party against whom enforcement is sought or by that party's authorized agent, sufficient to indicate that a lease contract has been made between the parties and to describe the goods leased and the lease term.
(2) Any description of leased goods or of the lease term is sufficient and satisfies subsection (1) (b), whether or not it is specific, if it reasonably identifies what is described."
However, UCC § 2-A-201 (4) (c) provides that "[a] lease contract that does not satisfy the requirements of subsection (1), but is valid in other respects, is enforceable . . . with respect to goods that have been received and accepted by the lessee." In this case, plaintiff herself contends that she received and accepted a number of the Chens' items, thus satisfying the statute to that extent.
Plaintiff also argues that the counterclaims should be dismissed for failure to state a cause of action because defendants have produced no evidence of the existence of either a lease or bailment agreement. Plaintiff denies the existence of either agreement, alleging that "[a]t no time during my relationship with Fred Chen and Heddy Chen did they ever lend any antiques to me; nor did I ever place any "cash security" to them for the purposes of "renting" their "antiques" (Han aff, ¶ 206). Plaintiff further alleges that "[n]either Fred Chen nor Heddy Chen has ever asked me to return any antiques that they lent to me" (id., ¶ 207).
However, in opposition to plaintiffs motion, defendants raise issues of fact as to the existence of either a lease or a bailment agreement. In contrast to plaintiffs allegations, the Chens testified that their antiques were not sold to plaintiff, but rather were lent to her via a security deposit, and that the Chens expected them to be returned, which, contrary to what plaintiff claims, did not occur (see 2/19/20 Fred Chen dep [NYSCEF Doc No. 233], at 107-108, 112, 133, 137-150; 2/20/20 Fred Chen dep [NYSCEF Doc No. 234], at 7-22, 25-31, 38-42, 44-48, 57-60, 96-97, 101-104; 2/20/20 Heddy Chen dep at 28; 2/26/20 Heddy Chen dep, at 139-65, 179-212, 224-234, 237-249; 3/11/20 Heddy Chen dep, at 7-35, 48-63, 57-63; William Chen dep [NYSCEF Doc No. 238], at 26-31); see also Heddy Chen aff, ¶ 6 ["All of the Chinese antiques that Plaintiff was given were lent to her for her temporary use as pleasure items, and the agreement was that they would all be returned"]).
Again, each party has a different version of the relevant events, which raises issues of fact foreclosing summary judgment. Moreover, plaintiff admits that she made several deposits to the Chens for antiques (see second amended complaint, ¶ 27 [listing certain payments as "deposit"]). Although plaintiff claims that these deposits were for items that she eventually did not buy (see PSMF, ¶¶ 63-88), a factfinder could conclude that these payments were, as defendants contend, security deposits for the purported loan of the antiques.
Plaintiffs motion for summary judgment dismissing defendants' counterclaims is thus denied.
The court has considered the remaining arguments and finds them to be without merit.
* * * *
Accordingly, it is
ORDERED that plaintiffs motion for partial summary judgment (motion sequence no. 004) is denied; it is further
ORDERED that defendants' motion for partial summary judgment (motion sequence no. 005) is granted, and the branch of the first cause of action for breach of an oral contract to sell antiques, and the second, third, fourth, fifth, sixth and seventh causes of action in their entirety, are dismissed, as is plaintiffs demand for punitive damages; and it is further
ORDERED that the parties appear for an initial pretrial conference to discuss trial scheduling and logistics on May 25, 2022, at 10:00 am in Courtroom 208.
This constitutes the decision and order of the Court.