Rios v. Sendowski

Full title: Melinda Rios, Plaintiff v. Oren Sendowski and MARBLE HILL PARTNERS LLC…

Court: Supreme Court, New York County

Date published: Oct 10, 2019

66 Misc. 3d 1230 (N.Y. Sup. Ct. 2019)

2019 N.Y. Slip Op. 52167

125 N.Y.S.3d 528

Opinion

450325/2016

10-10-2019

Melinda RIOS, Plaintiff v. Oren SENDOWSKI and Marble Hill Partners LLC, Defendants

Plaintiff Melinda Rios, Pro Se For Defendants David Spiegelman Esq., Spiegelman Law PC, 41 Carmine Street, New York, NY 10014

Lucy Billings, J.

Plaintiff Melinda Rios, Pro Se

For Defendants David Spiegelman Esq., Spiegelman Law PC, 41 Carmine Street, New York, NY 10014

Lucy Billings, J.

The court held a nonjury trial July 1 and 2 and August 6, 2019, on plaintiff Melinda Rios's action against defendants, Oren Sendowski and Marble Hill Partners LLC. Her action is for breach of a contract and, to the extent that her complaint raises claims for quantum meruit , the reasonable value of her services, and for unjust enrichment of defendants, on those claims as well. After the testimony and introduction of exhibits concluded, the court permitted plaintiff to designate the parts of defendants' depositions and answers to interrogatories that she offered as part of her evidence, which the court has considered with the trial testimony and exhibits. C.P.L.R. §§ 3117(a)(2), 3131.

I. BREACH OF A WRITTEN CONTRACT

The written contract that plaintiff claims defendants breached is a Commission Fee Agreement dated February 20, 2013, between Melinda Rios Inc., not plaintiff Rios, and "Oren Sendowski/GMAC REAL ESTATE" for real estate broker services. Ex. 2. In denying her motion for summary judgment, the court observed that Melinda Rios Inc. was of course free to commence a separate action for breach of the Commission Fee Agreement within the applicable statute of limitations. C.P.L.R. § 213(2). Nevertheless, plaintiff persisted in pursuing this action rather than commencing a new action by Melinda Rios Inc. The trial disclosed why: she sues for payment of a commission to her because only she and not Melinda Rios Inc. was a licensed broker at the time of the broker services, and the corporation, without its own license, may not recover a commission based on its officer's or sole shareholder's license. NY Real Prop. Law § 442-d ; Sharon Ava & Co. v. Olympic Tower Assoc. , 259 AD2d 315, 316 (1st Dep't 1999) ; Philip Mehler Realty v. Kayser , 176 AD2d 104, 106 (1st Dep't 1991) ; Burton v. Lucido , 135 AD3d 885, 886 (2d Dep't 2016) ; JCL Props., LLC v. Equity Land Developers, LLC , 102 AD3d 745, 746 (2d Dep't 2013). See DSA Realty Servs., LLC v. Marcus & Millichap Real Estate Inv. Servs. of NY, Inc. , 128 AD3d 587, 588 (1st Dep't 2015) ; Goldman Sachs Group, Inc. v. Almah LLC , 107 AD3d 448, 449 (1st Dep't 2013) ; Good Life Realty, Inc. v. Massey Knakal Realty of Manhattan, LLC , 93 AD3d 490, 491 (1st Dep't 2012). Therefore plaintiff's mistake was not in how plaintiff identified the party that was to sue defendants, but in how she drafted the Commission Fee Agreement and specified the party that was owed the commission. The evidence at trial revealed no other written contract with either defendant.

The evidence established that Oren Sendowski, a real estate developer, was working with GMAC Real Estate Company as a commercial real estate consultant. The commission is for brokering a lease of space at 22 Marble Hill Avenue, New York County, for a term of five years between defendant landlord Marble Hill Partners LLC and tenant Miniventures Inc. Daycare Center, which plaintiff procured for the landlord. The total commission is "5% of the gross rent collected over 5 yr lease term," which totaled $1,835,004. Id. Therefore the commission totaled $91,750.20. Melinda Rios Inc. agreed to split 35% of the commission with "Oren Sendowski/GMAC REAL ESTATE," leaving 65% or $59,637.63 as the "Commission Balance Due Melinda Rios Inc." Id. The "Payout of Commission to Melinda Rios Inc. " was "$5,000 at lease signing ," February 20, 2013, which was paid to plaintiff, with "Balance of commission to be paid in 18 monthly installments commencing at TCO ," which refers to the issuance of a Temporary Certificate of Occupancy October 24, 2013, for the leased space to be used as a daycare center. Id. Neither defendants nor GMAC Real Estate has paid this remaining $54,637.63.

The Commission Fee Agreement refers to the lease between the landlord Marble Hill Partners LLC and the tenant MiniVentures of New York "for specific information concerning this transaction." Id. Article 48 of the lease regarding "Brokerage" also provides that Melinda Rios Inc., rather than Melinda Rios, was the broker to which the landlord agreed to pay the commission that the landlord would negotiate with Melinda Rios Inc. Ex. 5, at 29. Although the lease was based on defendants' standard form, Oren Sendowski used the information from the Commission Fee Agreement to complete Article 48.

Tenant represents and warrants that it has dealt with no broker in this lease transaction other than Melinda Rios, Inc., Licensed Real Estate Broker, Bronxville, NY. Landlord agrees to pay the brokerage commission for this transaction to Melinda Rios, Inc. Said commission will be negotiated with Melinda Rios, Inc [sic] in a separate agreement.

Id. The evidence at trial, however, demonstrated that at the time of the lease transaction Melinda Rios Inc., was not a licensed real estate broker, but plaintiff, the corporation's sole officer and shareholder, was a licensed real estate broker. Nevertheless, because plaintiff's evidence demonstrates that plaintiff was not a party to the Commission Fee Agreement dated February 20, 2013, she fails to establish a breach of any written contract. Joseph Sternberg, Inc. v. Walber 36th Assoc. , 187 AD2d 225, 228 (1st Dep't 1993) ; Kopelowitz & Co., Inc. v. Mann , 83 AD3d 793, 797 (2d Dep't 2011) ; Re/Max Homes & Estates v. Leist , 308 AD2d 439, 440 (2d Dep't 2003).

Nor does plaintiff fit within the exception carved out in Alphas v. Smith , 147 AD3d 557, 558 (1st Dep't 2017), which allows the president and sole shareholder of a corporation who derives her livelihood from running the corporation to recover damages for breach of a duty to the corporation. Although plaintiff was the president and sole shareholder of Melinda Rios Inc. and derived her livelihood from providing the corporation's broker services, the only damages she might recover for defendants' breach of the Commission Fee Agreement would be damages she suffered individually. Those damages are limited to such personal losses as the inability to recover personal loans she made to her corporation, her payment of the corporation's debts that she guaranteed, or lost future wages, due to its insolvency from defendants' breach, or lost personal credit, loss of her shares in the corporation, or loss of her broker's license due to their breach. Alphas v. Smith , 147 AD3d at 558 ; Good Old Days Tavern v. Zwirn , 259 AD2d 300, 300 (1st Dep't 1999).

Plaintiff shows no such damages, but shows only the loss of $54,637.63 owed to Melinda Rios Inc., from defendants' breach of their obligations under the Commission Fee Agreement. Although that contract is unenforceable by her, the court considers whether she may recover based on an oral contract to which she was a party, based on the reasonable value of her services, or based on defendants' unjust enrichment to the extent that her complaint raises any such claim and she proves it. Resource Fin. Co. v. Cynergy Data LLC , 106 AD3d 562, 563 (1st Dep't 2013) ; Veritas Capital Mgt., L.L.C. v. Campbell , 82 AD3d 529, 530 (1st Dep't 2011) ; IIG Capital LLC v. Archipelago, L.L.C. , 36 AD3d 401, 405 (1st Dep't 2007) ; Ellis v. Abbey & Ellis , 294 AD2d 168, 170 (1st Dep't 2002).

II. BREACH OF AN ORAL CONTRACT

Plaintiff testified that in the spring of 2014 Janusz Sendowski, Marble Hill Partners LLC's sole managing member and Oren Sendowski's father, orally promised to plaintiff that Marble Hill Partners would pay to her the monthly payments due, once Miniventures Inc.'s owner obtained a license to operate a daycare center. In April 2014 $18,212.54 in monthly payments already was due. Miniventures Inc. eventually did obtain its license to operate a daycare center in August 2014, when four more payments of $3,035.42 per month were due.

The complaint encompasses such a promise: "Oren Sendowski and his father Janus Sendowski ... claim they will start to pay me $3035 whenever Shayla [Miniventures Inc.'s owner] has her license from the DOH (Department of Health) ..." Ex. 10 ¶ 32. Plaintiff, however, did not accept that offer and rejected any such promise. Her complaint continues: "this is not acceptable, and certainly not what we agreed to in writing." Id. Thus plaintiff recognized that the written contract and not any subsequent oral contract controlled the parties' rights and obligations.

The single $5,000.00 payment that Marble Hill Partners did make for the commission was by a check to plaintiff, Melinda Rios, drawn on Marble Hill Partners' account and signed by Oren Sendowski with the authority of Marble Hill Partners or Janusz Sendowswki. Ex. 6. When asked whether he contemplated that any further payment for the commission would be in the same form, he answered less than definitively: "Possibly, yes." Tr. of Proceedings at 23 (Aug. 6, 2019). He also made clear that the $5,000.00 payment was pursuant to the written Commission Fee Agreement and not any separate oral promise.

Based on the complaint and Janusz Sendowski's credible testimony, his promise that Marble Hill Partners would pay the monthly payments due once Miniventures Inc.'s owner obtained a license to operate a daycare center referred to payments under the Commission Fee Agreement with Melinda Rios Inc., even if they may have been based on a misinterpretation of that agreement. They were not a separate promise of payment to plaintiff. Therefore the court dismisses any claim by plaintiff for breach of an oral contract.

III. QUANTUM MERUIT

Although a party may not recover based on quantum meruit for services when a contract governs the party's recovery for those services, Clark-Fitzpatrick, Inc. v. Long Is. R.R. Co. , 70 NY2d 382, 388-89 (1987) ; Hudson Ins. Co., Inc. v. City of New York , 170 AD3d 622, 623 (1st Dep't 2019) ; Douglas Elliman, LLC v. East Coast Realtors, Inc. , 149 AD3d 544, 544 (1st Dep't 2017), the question remains whether a nonparty to the contract who actually rendered the services covered by the contract may recover the reasonable value of her services. Even in the absence of the Commission Fee Agreement, however, to recover based on the reasonable value of her services plaintiff must show that defendants, whether in writing or orally, expressly understood, assumed, or agreed to an obligation or responsibility to pay her, as opposed to Melinda Rios Inc., for the claimed services. See Ishin v. QRT Mgt., LLC , 133 AD3d 449, 450 (1st Dep't 2015) ; Chapman, Spira & Carson, LLC v. Helix BioPharma Corp. , 115 AD3d 526, 528 (1st Dep't 2014) ; Empire State Fuel Corp. v. Warbasse-Cogeneration Tech. Partnership, L.P. , 58 AD3d 534, 534 (1st Dep't 2009) ; Futterman Org. v. Bridgemarket Assoc. , 278 AD3d 105, 105-106 (1st Dep't 2000).

By producing a ready, willing, and able tenant that agreed to and closed on Marble Hill Partners LLC's lease provisions, plaintiff earned a brokerage commission. A.J. Clarke Real Estate Corp. v. Meyers , 27 AD3d 230, 230-31 (1st Dep't 2006) ; Srour v. Dwelling Quest Corp. , 11 AD3d 36, 40 (1st Dep't 2004) ; Joseph Sternberg, Inc. v. Walber 36th Assoc. , 187 AD2d at 228 ; Kaplon-Belo Assoc. v. Farrelly , 221 AD2d 321, 321 (2d Dep't 1995). She never showed, however, that either defendant accepted the services from her, as opposed to Melinda Rios Inc., or expected to compensate her, rather than Melinda Rios Inc. Jordan Panel Sys. Corp. v. Turner Constr. Co. , 45 AD3d 165, 180 (1st Dep't 2007) ; Priore v. New York Yankees , 307 AD2d 67, 71 (1st Dep't 2003) ; Metropolitan Steel Indus. v. Citnalta Constr. Corp , 302 AD2d 233, 233-34 (1st Dep't 2003). See Farina v. Bastianich , 116 AD3d 546, 548 (1st Dep't 2014) ; Balestriere PLLC v. Banxcorp , 96 AD3d 497, 498 (1st Dep't 2012) ; Fulbright & Jaworski, LLP v. Carucci , 63 AD3d 487, 489 (1st Dep't 2009) ; Graubard Miller v. Nadler , 60 AD3d 499, 499-500 (1st Dep't 2009). Although she showed the single $5,000.00 check to her, rather than to the corporation, Janusz Sendowski specifically connected that payment to the Commission Fee Agreement. In fact, plaintiff admitted that she wanted the commission paid to the corporation rather than to her for purposes of tax payments.

Most importantly, plaintiff failed to show the reasonable value of her services through expert evidence of the industry standard for calculating a brokerage fee for a commercial lease. She presented only her own standard 5% of the aggregate rent the tenant contracted to pay over the lease term and Marble Hill Partners' own standard, discussed below. Therefore the court dismisses any claim by plaintiff for the reasonable value of her services.

IV. UNJUST ENRICHMENT

Because plaintiff's claim for a commission does not necessarily depend on a signed agreement to pay the commission, Rachmani Corp. v. 9 E. 96th St. Apt. Corp. , 211 AD2d 262, 269 (1st Dep't 1995) ; Joseph Sternberg, Inc. v. Walber 36th Assoc. , 187 AD2d at 228-29 ; Robison v. Sweeney , 301 AD2d 815, 819 (3d Dep't 2003), she may support an unjust enrichment claim based on the benefit Marble Hill Partners gained from plaintiff's services and the parties' expectations that the landlord would pay the broker for the lease transaction. Kramer v. Greene , 142 AD3d 438, 442 (1st Dep't 2016) ; Resource Fin. Co. v. Cynergy Data LLC , 106 AD3d at 563 ; John Anthony Rubino & Co., CPA, P.C. v. Swartz , 84 AD3d 599, 599-600 (1st Dep't 2011) ; Kopelowitz & Co., Inc. v. Mann , 83 AD3d at 798. See Georgia Malone & Co., Inc. v. Rieder , 19 NY3d 511, 516 (2012) ; Mandarin Trading Ltd. v. Wildenstein , 16 NY3d 173, 182 (2001) ; Farina v. Bastianich , 116 AD3d at 548. Plaintiff demonstrated a relationship with defendants that induced her to perform her services, a benefit that defendants knew she was conferring on Marble Hill Partners and for which both she and defendants expected it would pay compensation. Farina v. Bastianich , 116 AD3d at 548-49. See Georgia Malone & Co., Inc. v. Rieder , 19 NY3d at 518 ; Mandarin Trading Ltd. v. Wildenstein , 16 NY3d at 182 ; Murphy v. 317-319 Second Realty LLC , 95 AD3d 443, 445 (1st Dep't 2012). She sues for payment of a commission to her because she, not Melinda Rios Inc., was the licensed broker that conferred the broker services. NY Real Prop. Law § 442-d ; Sharon Ava & Co. v. Olympic Tower Assoc. , 259 AD2d at 316 ; Philip Mehler Realty v. Kayser , 176 AD2d at 106 ; Burton v. Lucido , 135 AD3d at 886 ; JCL Props., LLC v. Equity Land Developers, LLC , 102 AD3d at 746. See DSA Realty Servs., LLC v. Marcus & Millichap Real Estate Inv. Servs. of NY, Inc. , 128 AD3d at 588 ; Goldman Sachs Group, Inc. v. Almah LLC , 107 AD3d at 449 ; Good Life Realty, Inc. v. Massey Knakal Realty of Manhattan, LLC , 93 AD3d at 491.

Janusz Sendowski himself embraced the practice, when a tenant like Miniventures Inc. "is without enough resources or references until the tenant establishes a good payment record," that: "All commissions Marble Hill pays are based only on rents received." Tr. of Proceedings at 20 (Aug. 6, 2019). He was asked: "How do you calculate a commission to a broker?"

A It's based on the amount of money we get paid.

....

....

Q Is that the industry standard for you?

A Yes.

Id. Janusz Sendowski further confirmed that Marble Hill Partners' practice was to pay a commission whenever Marble Hill Partners collected rent, that the commission was based on a percentage of the rent, and that the percentage was the product of negotiations.

Defendants readily admitted that Marble Hill Partners collected $236,500.00 in rent from its tenant Miniventures Inc. that plaintiff produced. Although the lease provides that the landlord may apply the tenant's security deposit to rent, no evidence indicates that Marble Hill Partners used Miniventures Inc.'s security deposit to increase its rent payments, as opposed to repairing damage to the leased space, for example. Ex. 5, at 17, 22-23. Plaintiff herself acknowledged that "the security deposit may be used for a multitude of things." Tr. of Proceedings at 56 (July 1, 2019). The percentage of the rent that was negotiated as the commission was 5%, yielding a commission of $11,825.00.

Oren Sendowski was an agent of GMAC Real Estate, which was Marble Hill Partners' agent for marketing Marble Hill Partners' space at 22 Marble Hill Avenue, New York County, for leasing. Through GMAC Real Estate, he was authorized to represent Marble Hill Partners, was assigned to lease the space, and listed it as available to be leased. Although Janus Sendowski referred to Oren Sendowski as Marble Hill Partners' broker in dealing with Miniventures Inc., no evidence indicates that he produced the tenant that agreed to and closed on Marble Hill Partners' lease provisions or played any part in achieving the tenant's agreement to the lease and the closing of the deal. Oren Sendowski acknowledged that plaintiff presented comprehensive information to him about the tenant's business and its principals, including its operations, locations, and track record. Therefore plaintiff is entitled to the full 5% of the rent collected.

V. CONCLUSION

For the reasons explained above, the court dismisses plaintiff Melinda Rios's claim against defendants for breach of the Commission Fee Agreement dated February 20, 2013; any claim by her for breach of an oral contract with defendant Marble Hill Partners LLC; and any claim by her for quantum meruit . Since plaintiff also failed to demonstrate any entitlement to the lost wages or punitive damages claimed in her complaint, the court dismisses those claims as well.

Based on defendant Marble Hill Partners LLC's unjust enrichment, by its own measure, the court awards plaintiff a judgment against Marble Hill Partners LLC for $11,825.00, with interest at 9% per year from August 1, 2014, the approximate midpoint in the amount and period of the rent payments to Marble Hill Partners. C.P.L.R. §§ 5001, 5004 ; Eighteen Holding Corp. v. Drizin , 268 AD2d 371, 372 (1st Dep't 2000) ; First Wall St. Settlement Corp. v. Hart , 187 AD2d 352, 353 (1st Dep't 1992) ; Manufacturers Hanover Trust Co. v. Weisbrot , 146 AD2d 500, 501 (1st Dep't 1989). This date also follows after plaintiff commenced this action informing defendants that they owed her a commission and requesting payment. First Wall St. Settlement Corp. v. Hart , 187 AD2d at 353.

The court dismisses all claims against defendant Sendowski. The Clerk shall enter a judgment according to this decision.