Opinion
01194-07.
Decided August 28, 2008.
Bracken Margolin, LLP, Islandia, New York, Counsel for Plaintiffs.
Westerman, Ball, Ederer, Miller Sharfstein, LLP, Mineola, New York, (for The Town of Hempstead), Richard S. Finkel, Esq., Town Attorney, Manhasset, New York, Counsel for Defendants, (for Harbor Ridge and Janowitz).
ORDER
The following papers were read on Defendant Town of North Hempstead's motion to dismiss the complaint and all cross-claims asserted against it; Defendants W.J. Harbor Ridge LLC Bernard Janowitz's motion to dismiss Plaintiffs' second, fourth and fifth claims contained in the Amended complaint asserted against them; Plaintiffs' cross-motions for partial summary judgment on the first, second, fifth and part of the fourth causes of action contained in the amended complaint, to amend the sixth cause of action as against Defendant Town of North Hempstead and to compel production of the Approved Landscaping Plan for the Development.
Motion Sequence Number 001
Notice of Motion dated April 30, 2007;
Affirmation of Richard S. Finkel, Esq. dated April 30, 2007;
Motion Sequence Number 002
Notice of Motion dated May 22, 2007;
Affidavit of Jeffrey A. Miller, Esq. sworn to on May 22, 2007;
Affidavit of Marcus Scraggins sworn to on May 18, 2007;
Defendant's Memorandum of Law dated May 22, 2007;
Motion Sequence Numbers 003, 004
There are 2 notices which rely on same affidavits.
Cross-motion/Opposition Motion
Notice of Cross-motion dated August 27, 2007;
Affidavit of Timothy G. Stapleton sworn to on June 29, 2007;
Affidavit of Robert M. Calica sworn to on August 27, 2007;
Plaintiffs' Memorandums of Law August 28, 2007 (two separate memos);
Support of Motion/Opposition to Cross-motion;
Affidavit of Bernard Janowitz dated February 1, 2008;
Defendant's Memorandum of Law dated February 6, 2008;
Affirmation of Richard S. Finkel, Esq. dated January 2, 2008;
Defendant Town of North Hempstead's Memorandum of Law;
Supplemental Affirmation of Linda V. Margolin, Esq. dated January 8, 2008;
Affidavit of James Nacos sworn to on December 31, 2007;
Reply Affirmation of Linda V. Margolin, Esq. dated March 20, 2008;
Supplemental Affidavit of Bernard Janowitz sworn to on April 16, 2008.
Defendant Town of North Hempstead ("Town") moves pursuant to CPLR 3211 (a) (3), (7), (8) and (10) dismissing the complaint and all cross-claims insofar as asserted against it (Motion Sequence 001).
Plaintiffs, Harbor View at Port Washington Home Owners Association ("HOA"), Richard J. Greene and James Nacos, as President and Secretary, respectively and individually and on behalf of all Homeowners similarly situated, cross-move pursuant to CPLR 3025(b) for an order granting leave to amend the sixth cause of action insofar as asserted against the Town (Motion Sequence 004).
Defendants W. J. Harbor Ridge, LLC ("Harbor Ridge") and Bernard Janowitz ("Janowitz") (collectively "Harbor Ridge Defendants") move pursuant to CPLR 3211(a)(1) and (7) for an order dismissing the second, fourth and fifth causes of action insofar as asserted against them (Motion Sequence 002).
Plaintiffs cross-move for (1) an order converting Defendants' motion to dismiss pursuant to CPLR 3211 to a motion for partial summary judgment pursuant to CPLR 3211(c) in favor of Plaintiffs on the first, second, part of the fourth and fifth causes of action (Motion Sequence 003).
BACKGROUND
The Harbor View at Port Washington community ("Harbor View"), which is located in an unincorporated portion of the Town of North Hempstead, is a so-called senior residential development consisting of some 125 single family, semi-attached and unattached homes ("Phase I"), and an adjacent six story, 145-unit condominium ("Phase II") building (Cmplt. ¶¶ 2-3).
All Phase I homes were completed and conveyed to homeowners between July 2002 and October 2005, while the Phase II homes were completed and conveyed to owners between July and August 2004 (Cmplt. ¶¶ 7-8).
Upon ratification of the development offering plan, and after sale of the first unit, title to the common areas was conveyed to the Plaintiff, HOA, a non-profit entity responsible for overseeing the operation and maintenance of the community's common property and facilities (Cmplt. ¶¶ 8-9).
It is alleged that Harbor Ridge was the project sponsor, developer and builder while Janowitz is alleged to have been either a principal and/or member of Harbor Ridge, or alternatively, a beneficial owner or concealed principal of that entity and a member of the initial, sponsor-controlled, HOA board of directors.
As set forth in the offering plan, until such time as all units were sold, the designees of the sponsor constituted the controlling majority of the HOA.
The sponsor ultimately relinquished control of the HOA in October 2005, after which resident homeowners were elected to the HOA, including the individual Plaintiffs herein, Richard J. Greene and James Nacos, who currently hold or have held, the offices of president and secretary, respectively (Cmplt. ¶ 10).
Plaintiffs assert, among other things, that the offering plan and related documents obligated the sponsor, Harbor Ridge to: (1) complete an outdoor pool, clubhouse and other recreational facilities no later than the Spring of 2003; (2) install 1,500 feet of "gating" around the easterly boundary of the community, including installation of a gatehouse and provision of full-time guard service; and (3) finish various common areas in accord with applicable Code requirements, engineering specifications and the community site plan, as approved by the Nassau County Planning Commission.
Despite the foregoing obligations, the Plaintiffs allege that the pool and community center were belatedly completed in July 2004; that a fitness area, which was to be located in the community center, was never installed; that trees which were to be planted in the center median of the community's main thoroughfare were never fully planted; that "Jitney" or community bus service was not provided and/or financed in the manner contemplated by the offering plan; and that the Harbor Ridge Defendants have, to date, failed to pay some $50,000.00 in maintenance charges due on sponsor-owned units.
The Plaintiffs also contend that, in alleged violation of stated Town of North Hempstead Code requirements (North Hempstead Town Code § 2-43[A]), the sponsor failed to ensure that "Phase I" homes were equipped with proper roof drainage apparatuses.
Specifically, the Plaintiffs assert that the Town Code of the Town of North Hempstead requires the installation of piping under the sidewalk to divert runoff water discharge away from common area sidewalks. They contend that as originally constructed, the gutters capturing roof drainage on completed units connected to leaders that terminated near splash blocks located near outside walls, resulting in basement leaks. According to the Plaintiffs, to remedy the problem, the sponsor installed above-ground PVC pipes from the units' roof drainage leaders as a "cheap fix", which resulted in hazardous above-ground water discharges onto development sidewalks and other common areas all of which will allegedly require costly corrective and remedial measures.
The Plaintiffs further allege that Town building inspectors not only failed to cite Harbor View for these Code violations or halt them, but later improperly issued certificates of occupancy for the units.
Notably, and as part of the original subdivision process, Harbor Ridge applied for and received, approval for the construction of the development from the Nassau County Planning Commission ("Commission") which application was granted by Resolution, dated May 16, 2000 (Nassau County Government Law § 1610[2]); Nassau County Charter § 1610[4], [6]).
Harbor Ridge was also required to post, and did post, a surety bond and escrow deposit with the County of Nassau securing the actual construction and installation of the involved public improvements (Nassau County Charter § 1610[4], [6][E]).
In 2006, Harbor Ridge made application for release of the bond and a public hearing before the Commission was conducted. At the hearing, it was established that the inspector for the Commission examined the premises and concluded that Harbor Ridge had satisfactorily completed all public improvements.
By resolution adopted November 2, 2006, the Commission granted Harbor Ridge's release application, but attached a caveat to its approval. That is, the Commission took note of certain testimony relating to "overland storm runoff from residential lots onto the sidewalk within the public-right of way" and recommended, inter alia, that the Nassau County Executive and Legislature condition the release upon Harbor Ridge's posting of a performance and maintenance bond with the Town covering all lots "for the proper management of storm water and associated work for the common areas and public right-of-ways."
The Plaintiffs further note that, prior to the issuance of the Commission's resolution, the North Hempstead Town Attorney wrote to the Commission stating that the Town opposed the bond release application since the original certificates of occupancy may have been issued "notwithstanding noncompliance with the Town code" and that "the matter remains under investigation by the Town and possibly another County agency", which the Plaintiffs assert was the Nassau County District Attorney's office.
The Town Attorney's letter further advises that, "[t]he result of our investigation may well be that the Certificates are revoked and that the developer is required to properly tie the drainage to the street" which would "require disruption to the sidewalk, which is exactly what the bond secures." (Proposed Amended Complt. ¶ 38).
Apparently, the conditional bond mentioned by the Planning Commission was never filed. Accordingly, the original escrow deposit and bond have yet to be released.
Thereafter, the Plaintiffs commenced this action against Harbor Ridge, Janowitz and the Town alleging various causes of action relating to claimed violations of the offering plan and a related claim that the Harbor Ridge Defendants breached stated fiduciary duties to the Plaintiffs by virtue of their purported misconduct.
The amended complaint also includes a sixth cause of action interposed exclusively against the Town, which arises out of the drainage claim and bond recommendation made by the Commission in 2006. (Amended Cmplt. ¶¶ 37-40). Styled as a claim interposed pursuant to CPLR Article 78, the sixth cause of action demands affirmative relief compelling the Town to require Harbor Ridge to post the conditional bond referenced in the Commission's November 2, 2006 resolution; to wit: "a performance and maintenance bond with the Town "covering all lots * * * for the proper management of Storm Water and associated remedial work for the Common areas and public rights of way * * *." (Amended Cmplt., "Wherefore" clause, at ¶ 6).
The parties now move and cross-move in connection with their respective contentions and claims.
Specifically, the Town moves to dismiss the sixth cause of action, arguing, inter alia, that: (1) this Court lacks personal jurisdiction over it since the instant matter was not commenced in accord with the service requirements applicable to such proceedings under CPLR 304 and 7804(a), (c); (2) the Plaintiffs are not the intended beneficiaries of the original or conditionally required bond and, therefore, lack capacity to sue; and (3) there is no justiciable controversy relative to the conditional bond since the Commission has exclusive authority over subdivision applications in unincorporated areas of the Town and the Town lacks the statutory authority or "regulatory framework" to require or administer such a bond.
The Harbor Ridge Defendants also move to dismiss the complaint insofar as asserted against them.
The Plaintiffs cross-move pre-discovery and pre-answer for a partial summary judgment on their first, second, part of the fourth and fifth causes of actions, as interposed against the Harbor Ridge Defendants (CPLR 3211[c]; 3212).
Notably, and in response to the Town's motion to dismiss, the Plaintiffs now separately move for leave to amend their sixth cause of action against the Town (CPLR 3025[b]).
DISCUSSION
A. Partial Summary Judgment
Preliminarily, the Plaintiffs' pre-answer motion for partial summary judgment is premature inasmuch as the application has been made prior to the joinder of issue. See, City of Rochester v. Chiarella, 65 NY2d 92, 101 (1985); and Sonny Boy Realty, Inc. v. City of New York , 8 AD3d 171 (1st Dept. 2004), affd, 4 NY3d 858 (2005). Thus, it must be denied without prejudice.
Moreover, upon the record presented the Court declines to exercise its discretion in favor of treating the motion as one for summary judgment pursuant to CPLR 3211(c) where discovery has not yet commenced and the parties are not unequivocally charting a course for summary judgment. Bronner v. Butterfield , 2 AD3d 475 (2nd Dept. 2003). Cf., Primedia Inc. v. SBI USA LLC , 43 AD3d 685, 686 (1st Dept. 2007).
B. Amend/Dismiss Sixth Cause of Action
Turning to the cross-motion to amend, the Plaintiffs have proposed a reworked version of their original, sixth cause of action based on an entirely different legal theory of recovery. The Plaintiffs now contend that the Town's issuance of the certificates of occupancy deprived the Plaintiffs of due process and equal protection of the law within the meaning of 42 U.S.C. § 1983 as well as pursuant to unspecified "common law principles." The motion to amend should be denied.
Although "[i]n the absence of prejudice or surprise to the opposing party, leave to amend a pleading should be freely granted", ( G.K. Alan Assoc., Inc. v. Lazzari , 44 AD3d 95, 99 [2nd Dept. 2007]; Ingrami v. Rovner , 45 AD3d 806, 808 [2nd Dept. 2007]. See, Edenwald Contracting Co., Inc. v. City of New York, 60 NY2d 957), "[t]he court must examine the merits of a proposed amendment, as leave to amend should not be granted where the proposed amendment is totally without merit or palpably insufficient as a matter of law". See, Shovak v. Long Island Commercial Bank, 50 AD3d 118 (2nd Dept. 2008); and Spano v. Northwood Tree Care, Inc. , 48 AD3d 667 (2nd Dept. 2007).
With these principles in mind, the Court agrees with the Town that the proposed amendment lacks merit and that an exercise of the Court's discretion with respect to the application is unwarranted. See, Beja v. Meadowbrook Ford , 48 AD3d 495, 496-497 (2nd Dept. 2008).
It is settled that "[i]n the land-use context, 42 USC § 1983 protects against municipal actions that violate a property owner's rights to due process, equal protection of the laws and just compensation for the taking of property under the Fifth and Fourteenth Amendments to the United States Constitution." Bower Assoc. v. Town of Pleasant Valley ,2 NY3d 617, 626 (2004); Town of Orangetown v. Magee, 88 NY2d 41, 49 (1996); and Schlossin v. Town of Marilla , 48 AD3d 1118 (4th Dept. 2008).
More particularly, "[i]n order to succeed on a claim for damages pursuant to 42 U.S.C. § 1983, a plaintiff must establish (1) deprivation of a cognizable property interest, meaning a vested property interest' (2) as a result of governmental action taken wholly without legal justification'." Nicolakis v. Rotella , 24 AD3d 739, 740(2nd Dept. 2005), quoting Bower Assoc. v. Town of Pleasant Valley, supra at 627. See also, 49 East Maple Avenue, Inc. v. Loniewski , 50 AD3d 628 (2nd Dept. 2008).
With respect to the requisite property interest issue, the alleged improper issuance of a certificate of occupancy and/or analogous claims based on the procedures leading up to the issuance of a certificate, do not represent protected property interests cognizable under the due process clause, or "cause an injury attributable to the government that rises to a constitutional level." Assoko v. City of New York, 539 F.Supp.2d 728, 740 (S.D.NY 2008). Accord, Seabrook v. City of New York, 509 F.Supp.2d 393, 405 (S.D.N.Y. 2007); Guoba v. Sportsman Properties, Inc., 2006 WL 2792753 * 6 (E.D.NY 2006); and Bletter v. Incorporated Vill. of Westhampton Beach, 88 F.Supp.2d 21, 25 (E.D.NY 2000). See also, Zahra v. Town of Southold, 48 F.3d 674 (2nd Cir. 1995).
Further, while the proposed amendment also vaguely refers to a purported equal protection claim, there is nothing in the Plaintiffs' pleading which meaningfully refers to similarly situated individuals who were treated in an actionably disparate manner ( Puccio v. Town of Oyster Bay, 229 F.Supp.2d 173, 177 [E.D.NY 2002]), or which adequately particularizes the factual grounds actually supporting this theory. See gen'lly, Darby Group Cos., Inc., Distribs. v. Village of Rockville Ctr., NY , 43 AD3d 979, 980 (2nd Dept. 2007); Staatsburg Water Co. v. Dutchess County, 291 AD2d 552, 553-554 (2nd Dept. 2002). See also, Assoko v. City of New York, supra at 735. The Plaintiffs have not submitted a reply opposing the legal claims interposed by the Town to meaningfully support their motion to amend the complaint.
Lastly, the Plaintiffs' proposed amended complaint again asserts albeit cryptically that the Town wrongfully failed to impose "its own requirement" that the sponsors file a bond relating to the alleged drainage runoff issue. The Court agrees that the foregoing theory claim is miscast and lacking in potential merit.
The record supports the Town's assertion that the bonding requirements imposed in connection with the project were not fixed or enforceable by the Town, but rather, were set in place by the Commission pursuant to statutory authority derived from the Nassau County Charter ("Charter"). Notably, and pursuant to the Nassau County Government Law, the originally posted bond is currently held by, and intended to secure, the County of Nassau.
There is nothing in the Charter that authorizes the Town to administer or affirmatively enforce bonding requirements imposed by the Commission for the benefit of Nassau County. Moreover, the Commission's determination with respect to the new bond is purely conditional. Since the sponsor has not elected to file a new bond, the originally posted bond and escrow deposit remain in possession of the County of Nassau continuing to secure the completion of the underlying public improvements.
Accordingly, the Plaintiffs' cross-motion for leave to serve an amended complaint must be denied. The Town's motion to dismiss the originally pleaded sixth cause of action must be granted.
C. Second, Fourth and Fifth Causes of Action
With respect to the motion by Harbor Ridge and Janowitz to dismiss the second, fourth and fifth causes of action pursuant to CPLR 3211(a)(7), the Court must accept as true, the facts "alleged in the complaint and submissions in opposition to the motion, and accord Plaintiffs the benefit of every possible favorable inference," determining only "whether the facts as alleged fit within any cognizable legal theory." Sokoloff v. Harriman Estates Development Corp., 96 NY2d 409, 414 (2001). See, AG Capital Funding Partners, L.P. v. State Street Bank and Trust Co. ,5 NY3d 582, 591 (2005); Polonetsky v. Better Homes Depot, 97 NY2d 46, 54 (2001); and Leon v. Martinez, 84 NY2d 83, 87-88 (1994).
On the other hand, "allegations consisting of bare legal conclusions, as well as factual claims inherently incredible or flatly contradicted by documentary evidence are not entitled to such consideration." Morris v. Morris, 306 AD2d 449 (2nd Dept. 2003). See, Maas v. Cornell Univ., 94 NY2d 87, 91-92 (1999); and Salvatore v. Kumar , 45 AD3d 560, 563 (2nd Dept. 2007).
1. Second Cause of Action
As to the so-called improper "drainage claim" (second cause of action), the Plaintiffs' complaint relies on § 2-43[A] of the Town Code, which provides:
"Leaders. A. Every building, except residential buildings of 2 ½ stories or less and private garages shall be kept provided with proper metallic gutters and rain leaders for conducting water from all roofs in such manner as shall protect the walls and foundations from injury. In no case shall the water from any rain leader be allowed to flow upon the sidewalk or adjoining property. The water from leaders may be conducted by proper pipes laid below the surface of the sidewalk to the street gutter, or may be conducted by extra-heavy cast-iron pipe to a leaching cesspool located at least 10 feet from any building. No plumbing fixtures shall be discharged into a leaching cesspool. Leaders in residential zones may be drained to the surface or dry wells.
(emphasis added).
The second cause of action alleges that the offending drainage installations were improper solely and exclusively because they violated an "express statutory requirement" set forth in the above-quoted Town Code provision.
In support of their motion to dismiss, the Harbor Ridge Defendants assert that the foregoing Code provision is inapplicable since it expressly excepts from its reach, " residential buildings of 2 ½ stories or less," and therefore applies only to leaders attached to premises other than "residential structures of 2 ½ stories or less." It is undisputed that the subject structures are indeed "2 ½ stories or less". Thus, the Harbor Ridge Defendants' argument is persuasive.
The first sentence of § 2-43[A] of the Town Code contains a directive requiring the installation of "proper metallic gutters and rain leaders" on every building " except residential buildings of 2 ½ stories or less * * *" It is true that the sentence relied on by the Plaintiffs which immediately follows, states that, "[i]n no case shall the water from any rain leader be allowed to flow upon the sidewalk or adjoining property."
However, upon viewing this provision in its proper contextual setting, it is clear that the reference to "any rain leader" refers back to and modifies the preceding sentence. Thus, it applies only to those "leaders" which are actually required by the Code language, which expressly excepts structures of 2 ½ stories or less from its reach.
Similarly unpersuasive is the Plaintiffs' additional theory that § 2-43[A] of the Town Code also requires that the Harbor Ridge Defendants undertake the installation of drainage piping "laid below the surface." There is nothing in the Town Code which requires the installation of underground drainage piping in connection with residential structures of 2 ½ stories or less. The language relied on by the Plaintiffs states in part that "the water from leaders may be conducted by proper pipes laid below the surface of the sidewalk to the street gutter . . ." [emphasis added]. Again, the Court agrees that the inference to be drawn from the statutory language referring to "water from leaders" is that the underground piping/leaching requirement applies only to leaders and structures actually falling within the scope of the Code's leader and gutter mandate a class which plainly excludes residential structures of 2 ½ stories or less.
The Town Attorney's 2006 letter to the Commission is not binding on the issue and does not, in any event, make any definitive statement with respect to the legality of the drainage system installed by the Harbor Ridge Defendants.
Lastly, while the Plaintiffs make reference in their reply papers to an alleged plan by which the Harbor Ridge Defendants purportedly agreed to divert drainage into "individual leaching pools", the second cause of action itself advances no claim or contention based upon the breach of any specific contractual provision, but instead, expressly and exclusively advances the theory that the drainage installation violated the North Hempstead Town Code.
It is settled that "[i]n order to plead a breach of contract cause of action, a complaint must allege the provisions of the contract upon which the claim is based . . ." Maldonado v. Olympia Mechanical Piping Heating Corp. , 8 AD3d 348, 350 (2nd Dept. 2004), quoting, Atkinson v. Mobil Oil Corp., 205 AD2d 719, 720 (2nd Dept. 1994). See also, Peters v. Accurate Bldg. Inspectors Div. of Ubell Ent., Inc. , 29 AD3d 972 (2nd Dept. 2006). It bears noting that the Harbor Ridge Defendants have submitted plans indicating that the original splash block drainage system (with surface flow to roadway drainage) was approved by the Town.
Under the circumstances, the Harbor Ridge Defendants' motion to dismiss the second cause of action pursuant to CPLR 3211 (a)(7) must be granted.
2. Fourth Cause of Action
As limited by their brief, the Harbor Ridge Defendants also move to dismiss that branch of the fourth cause of action which asserts that they failed to install a 1,500 foot gate along the easterly boundary of the property.
The complaint does not expressly identify the source of the Harbor Ridge Defendants' obligation to build the gate. The Plaintiffs have failed to meaningfully oppose the Harbor Ridge Defendants' claims in connection with the gate theory. See, McNamee Const. Corp. v. City of New Rochelle , 29 AD3d 544, 546 (2nd Dept. 2006). Accordingly, the Court agrees that the portion of the fourth cause of action relating to the foregoing claim should be dismissed.
3. Fifth Cause of Action
The fifth cause of action asserts breach of fiduciary duty as against Janowitz, individually, and Harbor Ridge.
According to the complaint, Janowitz was a member of the initial board of directors of the HOA, together with his appointees and designees. As such, he owed and breached his fiduciary duty to the homeowners and the HOA.
a. Harbor Ridge
The complaint goes on to more particularly allege that the "sponsor" presumably Harbor Ridge breached its fiduciary duties by, inter alia, failing to cause the HOA to clean and maintain roadways as required by the offering plan and by-laws; by failing to install or causing the HOA to install proper street lighting in occupied areas of the development until the latter part of 2003; by committing repeated acts of trespass and by leaving construction debris, dirt and garbage on common roadways; by failing to properly supervise construction workers; and by failing to timely schedule annual meetings of the homeowner members all allegedly for the purpose of . . . insulat[ing] . . . itself from liability for the . . . misconduct alleged . . ." (Cmplt. ¶¶ 34 [a]-[f]).
While the prior Board of Managers, including the Board of Managers appointed by the sponsor, owe a fiduciary duty to the unit owners ( Caprer v. Nussbaum , 36 AD3d 176, 191 [2nd Dept. 2006]; Murphy v. State, 14 AD3d 127, 136 [2nd Dept. 2004]; Board of Mgrs. of Acorn Ponds at North Hills Condominium I v. Long Pond Investors, Inc., 233 AD2d 472, 473 [2nd Dept. 1996]; Board of Mgrs. of Fairways at North Hills Condominium v. Fairway at North Hills, 193 AD2d 322 [2nd Dept. 1993]), "[t]here is no fiduciary relationship between the sponsor and the condominium." Caprer v. Nussbaum, supra at 191.
The cases cited by the Plaintiffs do not hold that sponsors owe fiduciary duties to unit owners or homeowner's associations. Accordingly, the breach of fiduciary duty claims should be dismissed insofar as asserted against the sponsor, Harbor Ridge.
b. Janowitz
The motion should be denied insofar as asserted against Janowitz, who does not dispute that he was initially a member of the HOA.
In support of their motion to dismiss, the Harbor Ridge Defendants first contend that the fifth cause of action to the extent interposed against Janowitz individually is defective as a matter of law, since certain subparagraphs contained in ¶ 34 of the complaint attribute the fiduciary misconduct alleged solely to the "sponsor,"Harbor Ridge. The Court disagrees.
Although ¶ 34 does at one point describe the fiduciary misconduct in "laundry list" fashion by repeatedly alleging that the "sponsor" (Harbor Ridge) committed the specific acts of misconduct (Cmplt. ¶¶ 34[a]-[f]), a review of the cause of action in its totality clearly reveals that the Plaintiffs are asserting that Janowtiz committed the same misconduct and thereby breached his fiduciary duties (Cmplt. ¶¶ 30-31, 34 [introduction]).
Moreover, the complaint sets forth additional averments clearly accusing Janowitz of violating his fiduciary duty and breaching "specific provisions of the Offering Plan and . . . Plan Documents" (Cmplt. ¶¶ 31-33).
In sum, according the complaint "the benefit of every possible favorable inference" ( Sokoloff v. Harriman Estates Development Corp., supra), the Court agrees that the fifth cause of action is properly construed as interposing fiduciary duty claims as against Janowitz.
With respect to the substance of the fiduciary duty claims, the Harbor Ridge Defendants' principally claim that: (1) they were in possession of easements authorizing them to complete construction of the development, thereby conclusively defeating any trespass/nuisance theory; and (2) that any fiduciary duty claims arising out of the installation of lighting should be dismissed as time-barred.
Although the fifth cause of action refers to trespass and nuisance (Cmplt. ¶ 34[d]), the sum and substance of the Plaintiffs' theory in this respect is that the Harbor Ridge Defendants performed the construction work in a shoddy, intrusive and dangerous fashion by, inter alia, leaving potholes, refuse, debris, construction materials about the premises in improper fashion and by failing to properly supervise workers on the premises (Cmplt. ¶ 34[a], [b], [d], [e]).
Upon liberally construing the Plaintiffs' complaint ( Sokoloff v. Harriman Estates Development Corp., supra), and since the mere existence of easements alone would not constitute a conclusive defense to the foregoing allegations of misconduct, the Court agrees that the allegations made are sufficient at this juncture" for pleading survival purposes'." Farber v. Breslin , 47 AD3d 873, 876 (2nd Dept. 2008).
The Harbor Ridge Defendants also move to dismiss the so-called "lighting claim" branch of the fifth cause of action, which alleges that they failed to install proper lighting called for by various contract documents "until the latter part of 2003" (Cmplt. ¶ 34[c]). In arguing for dismissal, the Harbor Ridge Defendants assert that the claim is time-barred by the three year limitations period applicable to fiduciary claims seeking monetary damages.
The Plaintiffs oppose this contention by arguing that this Court should consider the claim as one alternatively sounding in breach of contract, to which a six year limitations period would be applicable.
There is no dispute that "[a] cause of action for breach of fiduciary duty is governed by a . . . three-year statute of limitations where the only relief sought is money damages." Weiss v. TD Waterhouse , 45 AD3d 763, 764 (2nd Dept. 2007), quoting Wiesenthal v. Wiesenthal 40 AD3d 1078 , 1079 (2nd Dept. 2007); and Nathanson v. Nathanson , 20 AD3d 403, 404 (2nd Dept. 2005).
Although this claim is technically labeled as one sounding in breach of fiduciary duty, the complaint repeatedly asserts that, by failing to timely install proper lighting, the Harbor Ridge Defendants breached provisions of the offering plan, by-laws and declaration of covenants and restrictions (Cmplt. ¶¶ 33[a], 34).
Parties may plead alternative and contradictory theories of liability" ( Prohealth Care Assoc., LLP v. April, 4 Misc 3d 1017(A), 2004 WL 1872915 at * 5-6 [Sup. Ct. Nassau Co. 2006]. See also, Gold v. 29-15 Queens Plaza Realty, LLC , 43 AD3d 866, 867 [2nd Dept. 2007]; West Park Assoc., Inc. v. Cohen , 43 AD3d 818, 819 [2nd Dept. 2007]; and CPLR 3014), and that "[t]he same conduct may constitute both a breach of contract and a breach of a fiduciary duty." Hamlet on Olde Oyster Bay Home Owners Assn., Inc. v. Holiday Organization, Inc., 12 Misc 3d 1182(A) (Sup.Ct. Nassau Co. 2006). See, Davis v. Dime Savings Bank of New York, 158 AD2d 50, 52 (3rd Dept. 1990).
Considering, as it must, "whether the facts as alleged fit within any cognizable legal theory" ( Sokoloff v. Harriman Estates Development Corp., supra at 414; and Leon v. Martinez, supra at 87-88), the Court finds that the "lighting claim" is sustainable at this early juncture as one sounding in breach of contract to which a six year limitations period would be applicable. In so doing, the Court notes that the Harbor Ridge Defendants have not addressed or opposed the Plaintiffs' request that the Court consider the "lighting claim" as one sounding alternatively in breach of contract.
Accordingly, it is,
ORDERED, that the motion pursuant to CPLR 3211(a)(3), (7), (8) and (10) by the Defendant Town of North Hempstead dismissing the complaint and all cross-claims insofar as asserted against it is granted; and it is further,
ORDERED, that the cross-motion pursuant to CPLR 3025(b) by the Plaintiffs, for an order amending the sixth cause of action insofar as asserted against the Defendant Town of North Hempstead is denied; and it is further,
ORDERED that the motion to dismiss pursuant to CPLR 3211(a)(1) and (7) by Defendants W. J. Harbor Ridge, LLC and Bernard Janowitz is granted to the extent that the second, fourth and stated portions of the fifth cause of action are dismissed to the extent indicated herein, and it is further,
ORDERED that the cross-motion by the Plaintiffs pursuant to CPLR 3212 is denied as premature; and it is further,
ORDERED, that counsel shall appear for a preliminary conference on October 7, 2008 at 9:30 a.m.
This constitutes the decision and Order of the Court.