Opinion
Index No. 154187/2018 Motion Seq. No. 001
05-10-2022
JAMES CROAK, Plaintiff, v. GILBANE RESIDENTIAL CONSTRUCTION, LLC, TRAVELERS CASUALTY AND SURETY OF AMERICA, Defendant.
Unpublished Opinion
PRESENT: HON. SABRINA KRAUS, Justice.
DECISION + ORDER ON MOTION
SABRINA KRAUS, J.S.C.
The following e-filed documents, listed by NYSCEF document number (Motion 001) 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31 were read on this motion to/for DISMISSAL.
PENDING MOTION
Gilbane Residential Construction LLC ("Gilbane Residential") and Travelers Casualty and Surety Company of America ("Travelers") move to dismiss the complaint of James Croak ("Croak") dated May 4, 2018 in the action with Index No. 154187/2018.
The attacked claim of Croak is for mechanic's lien foreclosure. It fails as a matter of law because there is no "lien fund" to which it may attach and the absence of a "lien fund" is fatal to its lien foreclosure claim.
Gilbane Residential was the construction manager for a project known as 1010 Park Avenue-Extell, located at 1010 Park Avenue, New York, NY 10028 (the "1010 Park Project"). Forthill Construction Company ("Forthill") was a concrete subcontractor to Gilbane Residential on that project. Croak claims to be an unpaid sub-subcontractor to Gilbane Residential on that project and has filed a mechanic's lien and brought a lien foreclosure action with respect to it.
Gilbane Residential, through Travelers, have discharged the Croak lien by posting a lien discharge bond.
This court has already ruled that Forthill materially breached its contract with Gilbane Residential at the 1010 Park Project by abandoning it. Forthill's material breach by abandonment entitles Gilbane Residential to damages from Forthill and precludes, as a matter of law, Forthill from recovering any damages from Gilbane Residential with respect to the 1010 Park Project. Because Forthill's material breach pre-dates the filing of the lien by Croak, and because Gilbane Residential did not owe and never will owe any money to Forthill on the 1010 Park Project, the Croak lien must fail as a matter of law. Croak cannot establish the essential predicate to the viability of its lien, namely, that there was due or to become due money from Gilbane Residential to Forthill at the time it filed the lien.
As this court has determined on the motion for summary judgment by the plaintiffs in Action No. 1, that Forthill materially breached the 1010 Park Subcontract, no lien fund exists as a matter of law and the Croak lien must be dismissed.
ALLEGED FACTS
This action stems from a written construction subcontract agreement between Gilbane Residential and Forthill, whereby Forthill agreed to work as a structural concrete subcontractor to Gilbane Residential. Gilbane Residential and Forthill entered into the 1010 Park Subcontract on or about December 28, 2016.
On December 20, 2017 Forthill could not perform its work because it could not procure the requisite concrete for the 1010 Park Project. On December 22, 2017, Gilbane Residential gave Forthill written notice that it had materially breached the 1010 Park Subcontract and demanded adequate assurance of Forthill's ability to complete the 1010 Park Subcontract, and provided Forthill a 48-hour opportunity to cure, or else Gilbane Residential would hold Forthill in default and terminate it. Forthill ignored this notice of default, failed to respond to it and did not return to work at the 1010 Park Project.
On December 28, 2017, Gilbane Residential gave Forthill written notice that because Forthill failed to timely cure its material breaches of the 1010 Park Subcontract, Forthill was in default of the 1010 Park Subcontract and as a result, Forthill's employment under the 1010 Park Subcontract was terminated for cause. Forthill did not respond to the 1010 Park Termination Notice nor did it ever return to the 1010 Park Project.
On March 16, 2018, Croak filed a Notice Under Mechanic's Lien Law against the 1010 Park project. On April 3, 2018, Gilbane discharged the Lien by filing lien discharge bond No. 106835845, which Travelers issued.
DISCUSSION
It is axiomatic that the rights of a mechanic's lienor are dependent on the existence of a "lien fund" (sums due and owing or to become due and owing) at the tier immediately above the lienor in the contractual hierarchy. Peri Formwork Sys., Inc. v Lumbermens Mut. Cas. Co., 65 A.D.3d 533, 535 [2d Dept 2009]; Peri Formwork Sys., Inc. v Lumbermens Mut. Cas. Co., 112 A.D.3d 171, 177 [2d Dept 2013]; Clifford Broman & Son, Inc. v. Town of Babylon, 222 A.D.2d 643 [2nd Dept 1995]
In this case, for Croak's lien to be viable there would have to be a "lien fund" existing between Gilbane Residential and Forthill on the 1010 Park Project. Forthill's material breach and abandonment of the 1010 Park Project and Subcontract preclude the existence of the requisite "lien fund" and, thus, the lien and foreclosure claims must be dismissed as a matter of law.
As the court has determined on the related summary judgment motion that Forthill materially breached and abandoned the 1010 Park Project and Subcontract, there is no material question of fact in this action with respect to the lien and summary judgment is proper. Mallad Constr. Corp. v. County Fed. Sav. & Loan Ass'n, 32N.Y.2d285 [1973].
When all triable issues are legal, or, uncontroverted facts allow only one conclusion as a matter of law summary judgment is appropriate. Long Island R.R. Co. v. Northville Indus. Corp., 41 N.Y.2d 455 [1977]; Alvord & Swift v. Stewart M. Muller Constr. Co., Inc., 46 N.Y.2d 276 [1978].
CONCLUSION
WHEREFORE it is hereby:
ORDERED that defendant's motion to dismiss this action is granted; and it is further
ORDERED that lien filed by Croak on March 15, 2018 and docketed in the Office of the New York County Clerk for the property known as 1010 Park Avenue, New York, New York, Block 1496, Lot 1101-1102 is hereby vacated, canceled and discharged; and it is further
ORDERED that, within 20 days from entry of this order, movant shall serve a copy of this order with notice of entry on the Clerk of the General Clerk's Office (60 Centre Street, Room 119); and it is further
ORDERED that such service upon the Clerk shall be made in accordance with the procedures set forth in the Protocol on Courthouse and County Clerk Procedures for Electronically Filed Cases (accessible at the "E-Filing" page on the court's website at the address www.nycourts.gov/supctmanh);]; and it is further
ORDERED that any relief not expressly addressed has nonetheless been considered and is hereby denied; and it is further
ORDERED that this constitutes the decision and order of this court.