Opinion
Index No. 650030/2019
12-08-2022
Conesus Properties LLC, Plaintiff, v. Photovillage Industries Inc. and Richard Pinto, Defendants.
Marcus Rosenberg & Diamond LLP, New York, NY (David Rosenberg of counsel), for plaintiff. John A. Coleman, Jr., Esq., New York, NY, for defendants.
Unpublished Opinion
Marcus Rosenberg & Diamond LLP, New York, NY (David Rosenberg of counsel), for plaintiff.
John A. Coleman, Jr., Esq., New York, NY, for defendants.
Hon. Gerald Lebovits, J.S.C.
The following e-filed documents, listed by NYSCEF document number (Motion 006) 285, 286, 287, 288, 289, 290, 291, 292 were read on this motion for REARGUMENT.
In this commercial landlord-tenant action, plaintiff previously brought on by order to show cause a motion for an attachment of defendant Photovillage's assets. (See NYSCEF No. 14 at 1.) Plaintiff also requested interim relief restraining up to $317,550 of Photovillage's assets. (Id. at 2.) The ex parte justice (Michael L. Katz, J.) granted plaintiff's request for an interim restraint. (See id.) Following briefing and argument on the underlying motion, this court held that plaintiff was not entitled to an attachment and vacated the interim restraint. (NYSCEF Nos. 165, 167.)
Photovillage then moved under CPLR 6212 (e) for damages sustained as a result of the now-vacated interim restraint on its assets. Photovillage sought $64,438.10, comprising lost profits, interest on the funds attached, and attorney fees incurred in obtaining vacatur of the restraint. (NYSCEF No. 207.) In opposition, plaintiff argued that because the funds at issue had only been subject to a temporary restraining order, rather than an ultimate order of attachment, damages under CPLR 6212 (e) were unavailable. This court disagreed.
In a decision delivered on the record, this court concluded that because the TRO had led to Photovillage's being unable to make any use of the $317,550 at issue-in part because Photovillage's bank had removed that money from Photovillage's account without notice-the funds "were in effect attached, not merely subject to some forms of restraints." (NYSCEF No. 291 at Tr. 11.) This court accordingly entered an order in October 2022 granting Photovillage's request for attorney fees (approximately $30,000) and lost interest (approximately $11,000); but denying for lack of sufficient proof Photovillage's lost-profits request. (NYSCEF No. 270 [order memorializing on-the-record-decision].) The court awarded Photovillage damages of $40,991.74. (Id.)
Plaintiff now moves for reargument of this court's damages award. Plaintiff argues that this court overlooked precedents distinguishing between a temporary restraining order limiting a party's use of funds (which may not support a damages award under CPLR 6212 [e]) and an ultimate order of attachment (which may support a damages award). This court concludes that plaintiff is correct that this court's prior order misapprehended the law concerning attachment damages.
In particular, this court's prior decision focused on the practical effects of the temporary restraining order on Photovillage's ability to use its funds. But as made clear by A & M Exports, Ltd. v Meridien International Bank, Ltd. (222 A.D.2d 378, 380 [1995]), cited by plaintiff on the current motion, the proper inquiry focuses instead on the basis of the restraint: i.e., attachment granted under CPLR 6201 versus temporary restraining order granted under CPLR 6313. A court considering a CPLR 6212 (e) damages motion must admittedly still consider whether the nature of the restraint-granting order is in substance more akin to an order of attachment or to a TRO. (See Louie v David & Chiu Place Rest., Inc., 261 A.D.2d 150, 150-151 [1st Dept 1999].) But the focus remains on the court's order, not on the ensuing consequences for the restrained party. This court misapprehended the law in holding otherwise. That misapprehension warrants the grant of leave to reargue.
For this reason, this court is not persuaded by defendants' contention that leave to reargue should be denied because plaintiff's papers on this motion repeat the same points as it made in the prior motion. Defendants are correct that reargument is not warranted merely to rehash the same arguments again. But where, as here, the court is persuaded that it misapprehended the law in rejecting a party's contentions the first time, that the unsuccessful party has made the same contentions again does not bar the grant of leave to reargue.
This court's conclusion that Photovillage may not recover damages under CPLR 6212 (e) does not end the matter, however. Both Louie and A & M Exports make clear that when a party's assets have been restrained by a TRO issued on an attachment motion, that party may recover damages under CPLR 6313 and 6315, even if it may not do so under CPLR 6212. (See Louie, 261 A.D.2d at 151-152; A & M Exports, 222 A.D.2d at 380.) Indeed, the Court held in Louie that it is reversible error for a court, having concluded that CPLR 6212 damages are unavailable, to "neglect[ ] to reach the issue of whether defendants are entitled to relief under CPLR 6313." (261 A.D.2d at 151.)
To be sure, Photovillage's damages motion cited only CPLR 6212 (e), without mentioning CPLR 6313 or 6315. (NYSCEF No. 207 at 1.) However, the motion also requested "[s]uch other and further relief as this Court deems appropriate." (Id.) And this court retains authority in any event to "grant any type of relief within its jurisdiction appropriate to the proof whether or not demanded." (CPLR 3017.) And both "attorneys' fees incurred in a successful effort to vacate a restraining order" and "[l]ost interest on the funds that were restrained" constitute recoverable damages under CPLR 6315. (Louie, 261 A.D.2d at 152.) This court therefore adheres on reargument to its prior determination awarding Photovillage $40,991.74 in wrongful-restraint damages.
Photovillage's prior motion also satisfies CPLR 6315's requirement that damages have been sought by motion made on notice.
Accordingly, it is hereby
ORDERED that the branch of plaintiff's motion seeking leave to reargue this court's order entered October 11, 2022, is granted; and it is further
ORDERED that on reargument, this court adheres to its determination in that order that Photovillage is entitled to damages in the amount of $40,991.74; and it is further
ORDERED that defendants serve a copy of this order with notice of its entry on plaintiff.