Opinion
00 Civ. 3143 (JSM).
December, 2000.
For Plaintiff: Joseph Lee Matalon, New York, NY.
For Defendant: James D. Christo, Raice, Paykin, Krieg Schrader, New York, NY.
OPINION AND ORDER
Plaintiff 100% Girls Brand, Inc. ("100% Girls") brings this action for tortious interference with contract against defendant Hilson Management Corp. ("Hilson"). 100% girls alleges that Hilson tortiously interfered with a sublease that 100% Girls was attempting to form with Hilson's tenant, Bugle Boy International, Inc. ("Bugle Boy"). Hilson moves for summary judgment pursuant to Rule 56. For the reasons set forth below, Hilson's motion is granted.
On April 15, 1986, Hilson leased the second floor of 390 Fifth Avenue to Bugle Boy. Paragraph Forty of that lease specifically requires that Bugle Boy obtain Hilson's written consent before subletting the property, and provides that Hilson will not withhold such consent unreasonably. Hilson also agreed to notify Bugle Boy of its decision to give or withhold consent within sixty days after Bugle Boy supplied a sublease for approval.
On March 3, 2000, Bugle Boy entered into a purported sublease with 100% Girls (the "Sublease"). This Sublease by its terms required Hilson's approval, and provided that such approval would be evidenced by Hilson's signature. Despite this provision, Hilson's signature does not appear on the Sublease.
On March 10, 2000, Bugle Boy provided Hilson with the Sublease for approval. Bugle Boy also provided, at Hilson's request, a letter of credit from 100% Girls as security for the Sublease and a check for the first month's rent. Shortly thereafter, Hilson informed Bugle Boy that it would not consent to the Sublease. Bugle Boy then informed 100% Girls of this refusal, and notified them that Bugle Boy would be subletting the property to another party selected by Hilson.
According to the New York Court of Appeals, the four elements of a tortious interference with contract claim are: "1) the existence of a contract between plaintiff and a third party; 2) defendant's knowledge of that contract; 3) defendant's intentional inducement of the third party to breach or otherwise render performance impossible; and 4) damages to plaintiff." Kronos, Inc. v. AVX Corp., 81 N.Y.2d 90, 94 (1993). Even where there is no formal contract, New York courts recognize a claim for tortious interference with a business relationship. See, e.g., Hannex Corp. v. GMI, Corp., 140 F.3d 194, 205 (2d Cir. 1998) (listing cases).
There is no tortious interference without wrongful action, however. See generally Restatement (Second) of Torts §§ 767-69. When a party acts in its own self-interest, that is not necessarily wrongful. Here, Hilson had a right to approve the contract between 100% Girls and Bugle Boy and elected not to do so. Even if Hilson did not approve the contract because of some self-interested motive, that does not mean that its denial of approval was tortious. See Hannex, 140 F.3d at 206; NBT Bancorp, Inc. v. Fleet/Norstar Fin. Group, Inc., 87 N.Y.2d 614, 624 (1996).
100% Girls argues that Hilson cannot escape liability from tortious interference by preventing the Sublease's formation "through its own wrongful refusal to approve [the] contract. . . ." (Pl's. Mem. Opp'n Summ. J. at 5.) However, all three cases cited in support of that proposition are easily distinguishable. In each of those cases, the plaintiff was a party to a contract who was owed a duty of good faith, and there was evidence of bad faith, or "wrongfulness," on the defendant's part in refusing to approve the contract.
In Kravstov v. Thwaites Terrace House Owner's Corp., the cause of action for tortious interference was sustained on the basis of allegations that a member of a cooperative board had placed "unjustified conditions" on the plaintiff's sale to a third party. 700 N.Y.S.2d 177, 178 (App.Div. 1999). Specifically, the board member "allegedly demanded a commission in connection with plaintiff's purchase of an adjoining apartment, and also demanded, in exchange for approval of the sale, the discontinuance of plaintiff's lawsuit against him for water damage." Id.
Salatino v. Pryor similarly involved allegations of bad faith.
644 N.Y.S.2d 716, 717 (App.Div. 1996). The defendant claimed that the sale of a cooperative apartment was barred because the building's rules prohibited its use as a doctor's office. See id. However, the plaintiff presented evidence that the apartment had been used with the defendant's knowledge as a doctor's office for thirty years. See id. Supplemental building rules acknowledged this use. See id. There was additional evidence that the Board's withholding approval was part of a "pattern of harassment and disparate treatment" against plaintiff. Id.
Finally, Maruki v. Lefrak Fifth Avenue Corp. contained similar allegations of impropriety. 555 N.Y.S.2d 293 (App.Div. 1990). The plaintiffs contended that consent to the sublease was withheld because defendant demanded a $30,000.00 bribe. See id.
Here, Hilson was not a party to a contract with 100% Girls and, therefore, did not owe it a duty of good faith; in addition, there is no evidence that Hilson's refusal to approve the formation of the Sublease was wrongful. Although 100% Girls speculates as to possible motivations for bad faith on Hilson's part, 100% Girls provides no evidence of ill will or impropriety. Conclusory statements reiterating mere allegations cannot defeat a summary judgment motion. See Fed.R.Civ.P. 56(e). In the absence of any such evidence of bad faith, Hilson was within its rights to withhold consent to the sublease as provided in Paragraph 40 of the lease with Bugle Boy and further incorporated into the Sublease with 100% Girls. Plaintiff has failed to raise a factual issue as to this element of its tortious interference claim.
Defendant's motion for summary judgment is granted.
SO ORDERED.