Opinion
LT-052472-18/KI
06-04-2019
FRANPO REALTY LLC, Petitioner, v. POWER FURNITURE, INC., Respondent.
Petitioner's Attorney: Eric N. Pitter, Esq., Kossoff PLLC, 217 Broadway, Suite 401, New York, NY 10007 Respondent's Attorney: Regina Felton, Esq., Felton & Associates, 1371 Fulton Street, Brooklyn, NY 11216
Petitioner's Attorney: Eric N. Pitter, Esq., Kossoff PLLC, 217 Broadway, Suite 401, New York, NY 10007
Respondent's Attorney: Regina Felton, Esq., Felton & Associates, 1371 Fulton Street, Brooklyn, NY 11216
Odessa Kennedy, J.
After prevailing in a commercial holdover summary proceeding, a hearing was conducted to determine petitioner's attorney's fees and expenses which petitioner alleged was in the amount of $80,658.89. Following a hearing held on May 6, 2019, the court awards $29,809.89 in attorneys' fees and disbursements.
The prevailing party in a commercial holdover summary proceeding is entitled to reasonable attorney's fees where the lease contains an attorney's fee provision (see, 228 Threestar, LLC v. NKR Laundry II Inc. , 60 Misc 3d 1229(A), 2018 NY Slip Op. 51257(U) [Civ Ct, Bronx County 2018] ), East Fordham Road Real Estate Corp v. 260 E. Fordham Store Inc. , 2001 NY Slip Op. 40318(U) [Civ Ct, Bronx County 2001] ). It is within the court's discretion to determine what is a reasonable attorney's fee under the circumstances of the case ( Ebrahimian v. Long Is. R.R., 269 AD2d 488 [2d Dept 2000] ).
In the case at bar, the lease entitles the petitioner to attorney fees. Articles 19, 61 and 75 of the lease each provide that landlord may recover legal expenses including attorney's fees for commencing any proceeding resulting from the tenant's default in performing its obligations under the lease
Courts use the "lodestar" method in landlord-tenant litigation to determine whether attorney's fees are reasonable. ( Nestor v. Britt , 16 Misc 3d 368 [Civ Ct, New York County 2007], affd , 19 Misc 3d 142(A) [App Term, 1st Dept 2008] ). Under this method, the court determines the reasonable hourly rate and multiplies it by the reasonable number of hours expended, then adjusts the fee based on certain subjective criteria ( Ousmane v. City of New York , 22 Misc 3d 1136(A), 2009 Slip Op. 504698 (U) [Sup Ct, New York County 2009] ). The first step to be taken in arriving at a fair and appropriate award of attorney's fees under the lodestar method is to determine whether the number of hours claimed were reasonably expended (id. citing Becker v. Empire of America Federal Savings Bank , 177 AD2d [4th Dept 1991] ), by considering the following factors: the difficulty of the issues and skill required to resolve them; the lawyer's experience, ability and reputation; the extent to which the hours reflect inefficiency or duplicative work; legal versus non-legal work, investigations, and other work performed by non-lawyers; time spent in court differentiated from out-of-court efforts; the customary fee charged for similar services; the results obtained; the protracted nature of the summary proceeding; and the court's own knowledge, experience and expertise as to the time required to complete a similar task (see Nestor v. Britt , 16 Misc 3d 368, 2007 NY Slip Op. 27155 [Civ Ct, New York County 2007] ; see also Triborough Bridge and Tunnel Authority v. Wimpfheimer , 10 Misc 3d 138(A), 2004 NY Slip Op. 51896(U) [App Term, 1st Dept 2004] ; Ianniciello v. PBDP, Inc. , 47 Misc 3d 148(A), 2015 NY Slip Op. 50770(U) [App Term, 2d Dept 2015].).
Significantly, it is the affirmative duty of the party seeking attorney fees to prove the reasonableness of both the hourly rate and the time expended. ( Kaygreen Realty Co. v. IG Second Generation Ptnrs., L.P. , 78 AD3d 1008 [2d Dept 2010] ). Moreover, the court need not accept inadequately documented hours which reflect "padding," i.e., hours that are excessive or otherwise unnecessary (see, 140 West 28th Street Associates, LLC v. 140 West 28th Street Associates , 32 Misc 3d 1239(A), 2011 NY Slip Op. 51638(U) [Civ. Ct, New York County 2011] ).
In the instant matter, the court finds that the hourly rates of $250-$275 billed by petitioner's attorneys is reasonable. (See, 235 E. 83 Realty, L.L.C. v. Fleming , 18 Misc 3d 1142(A), 2008 NY Slip Op. 50412(U) [Civ Ct, New York County 2008] ). Petitioner's attorney did not, however, uphold his burden to show that the time billed was reasonable.
At the fee hearing, petitioner's counsel introduced into evidence billing records in the amount of $80,658.89 which were properly received into evidence despite the fact that the bills included the time spent by his coworkers. (See Nestor v. Britt 16 Misc 3d 368 [Civ Ct, New York County 2007] ; S.B.H. Realty v. Santana , 57 Misc 3d 1205(A), 2017 NY Slip Op. 51280(U) [Civ Ct, Bronx County 2017] ).
The trial of the underlying proceeding consisted of testimony from four witnesses which, compared to similar cases, could have been reasonably completed in two to three days. In the instant matter, however, the trial lasted 13 days, although there were dates when the parties were allotted substantially less than a full day for trial due to other cases on this court's circuit calendar.
Notably, the unusually protracted trial was not the result of the complexity of the issues. Rather, the extreme hostility between counsels and their resulting excessive colloquy may have contributed to the length of the trial. However, without the benefit of the trial transcripts, which both parties purchased but did not provide, the court is unable to determine if, and how long, the parties' mutual animosity extended the trial.
Nevertheless, based on my experience as the trial judge, I find that the failure of petitioner's attorney during the course of the trial to formulate questions in proper form and abide by the court's rulings on objections unreasonably increased the length of the trial beyond the usual two to three days. This time will be subtracted from the time awarded herein.
Another factor that substantially lengthened the trial was the significant time expended in questioning witnesses in detail about numerous photographs which petitioner's counsel moved into evidence, as depicting the subject premise at issue. The petitioner testified exhaustively regarding the details of what was shown in the photos during direct and cross examination, and consistently stated that the photos showed the subject premise. The petitioner's testimony regarding the factual details of the photographs were mirrored by petitioner's expert. However, after the extensive testimonies of the petitioner and his expert, the petitioner's attorney stipulated that the petitioner made a mistake in identifying premises shown in the photographs as the subject premise, and that the premise identified in the photographs, was in fact an adjoining building which is not even owned by petitioner
As the testimony of the petitioner and petitioner's expert regarding the details of the photographs were erroneous, the time spent regarding the erroneous testimony will not be awarded. However, without the benefit of the transcripts, this court cannot determine the precise length of time spent on inaccurate testimony regarding the photographs.
In addition to unreasonably protracting the duration of the trial, some of the petitioner's billings entries are duplicative. During the course of the trial, petitioner's counsel went on vacation, which resulted in the reassignment of the case to another attorney from his firm. As the time spent by new counsel to prepare for trial due to the re-assignment is duplicative, it will be excluded from the award.
The petitioner's bills are further deficient as they lack specificity. While petitioner, for instance, bills for appearance in court for seven hours, there is no indication that the time billed excludes transportation to and from court, or any information regarding the location from which counsel traveled to and from court. Absent the foregoing information, the court is unable to determine how many of the hours billed were spent in court as opposed to travel time, and thus, whether, the travel time billed, was reasonable. These deficiencies are unnecessary, as the petitioner's counsel has obtained the trial transcripts, which he could have used to easily determine the duration of each trial, the court's scheduling of the time allotted for trial each day, and any delay or waiting period, absent travel time.
Petitioner's billing entries are further deficient as the billing entries are for multiple services rendered collectively, instead of one. The vagueness and ambiguity created by the practice of collective billing effectually deprives the court of the ability to assess the reasonableness of the amount billed for each service. Furthermore, at the hearing, there was no testimony proffered to provide clarity to any of these entries.
For instance, billing entry 1221390 dated 1.24.18 bills thirty minutes for "a call to Ron Black and review of service affidavit, had EP review as well." The entry does not specify the length of the call to Mr. Black, the purpose of the call or the subjects discussed, or how long it took counsel to review an affidavit of service.
In addition to the inherent ambiguity of the collective billing, the entries lack necessary details that would enable the court to determine if petitioner billed twice for the same service. For instance, in addition to the above January 24, 2018 bill, where counsel had billed for reviewing an affidavit of service, on the same date, counsel again bills for "review of affidavit of service," without any indication that the second affidavit of service is different than the first reviewed on the same date.
The practice of collective and nebulous billing is pervasive in this matter. Some additional examples of this include:
Entry 1209753 billed 3.2 hours for "[c]onference with JSC regarding default notice, review violations and summonses; e-mail to EE regarding violations, phone call with JE and EE regarding cancellation and defaults, continue preparation of default notice for more specificity; conference with JSG regarding strategy regarding cancellation or default." This entry does not indicate how much time was spent on the conference, email and telephone call and how much time was spent continuing to prepare the default notice. The time spent on the default notice was in addition to the prior time spent under entry 1208987 ("Review of draft notice and lease conference with EP regarding revisions" also with the time spent on each task unspecified), entry 1209802 ("Preparation of final draft of default notice and conference with JSC regarding curing violations and fines; phone call with JE and edits to notice " —still with no indication how much of the 1.2 hours was devoted to the notice) and entry 1209815 ("[t]elephone conference with JE and super regarding access and edits to notice of default; draft proposed edits ; conference with AM regarding mailings.").
From these collective billing entries, it is impossible to judge just how much of the 5.7 hours billed should be ascribed to the editing of the default notice which is only a page and a half.
Equally impenetrable is the entry describing the creation of the default notice as that entry, number 1209744, also includes reviewing the default provisions of the lease, reviewing and printing all ECB and Department of Building violations; and reviewing correspondence between landlord and tenant as the three and a half hours spent on these tasks, was not dissected by the task for judicial review by either testimony or billing records.
Entry 1233732 billed 4.2 hours for "finish trial preparation of; phone call with JE and voicemail to opposing counsel." There is no indication as to what portion of the 4.2 hours were billed for trial preparation instead of the time spent on the two phone calls. Moreover, there was no explanation provided as to precisely what was done during the 4.2 hours of preparation.
Entry 1233737 included "[a]ppearance in Court for trial, multiple conferences with Jack regarding order and return date for trial; type up order and email to JE and Ann, conference with JSG regarding appearance." Again, there's no indication as to how much time was spent conferencing the matter with various individuals, as opposed the court appearance, and whether the entry included travel time.
Entry 123607 included an hour and a half for teleconference with JE regarding strategy, review lease , conference with RCL, email to opposing counsel, JE and Ann regarding statement for violations, without specifying how much time was allotted to each task. Moreover, the review of lease is again billed under entry, 1239902 for two hours and twenty minutes, along with "continue research," without any explanation as to why the lease was repeatedly reviewed and length of time expended in review of the lease in each entry. Counsel further billed for review of the lease pursuant to entry number 1322714. Again, it is impossible to determine how much time counsel spent to review the lease, as each of the above billing entries, contains multiple services collectively.
Entry 1232012 included preparation of certified documents for trial, review file/pleadings; email to EE regarding court; phone call with Jack and Jason regarding trial and strategy; review all violations and Department of Buildings complaints; phone call with Anne and Jack. The 1.8 hours billed are not broken down by task and petitioner's counsel gave no testimony clarifying either how the time was spent or who the referenced people were.
In some instances, the vagueness of the collective entries extends even to the extent that they may be collective. For example, entry 1223930 reads: "Preparation for trial; certify Department of Buildings violations and deed; make copies of trial exhibits." As listed, it is impossible to tell if this entry represents trial preparation, document certification and photocopying or if the trial preparation consisted solely of document certification and photocopying. If the former, the entry for "trial preparation" is too vague to determine reasonableness. If the latter, 2.10 hours of attorney time seems excessive for photocopying, which is a clerical task, and the certifications which may also have been billed under entry 1242346.
The petitioner did not meet its burden of proof as to the billing rate for paralegals since, unlike the attorneys, none of their qualifications were submitted by the petitioner to support the $135 per hour sought for their work. This is particularly important for workers billed as "paralegals" as that word is used generically in this part of the State to sometimes include all level of legal assistants from barely skilled laborers who only make copies through educated and experienced professionals doing skilled work. While each of these types of contribution have value in a law office, it cannot be reasonably said that they have the same monetary value. The lack of credentials presented to support the uniform billing level of these "paralegals" leaves this court without any way to conclude what value to set on the time of the worker.
Moreover, while some of the is work billed as legitimate paralegal work, much is not. For instance, one of the people billed at the $135 per hour rate as "JOE F" appears to be used almost exclusively as a messenger or calendar service, bringing papers to and from court. The only other entry relating to this person is for signing an affidavit of service for a motion. Perplexingly, there is no companion entry for time spent actually serving the motion.
Entry 1220005 is a claim for $1,200.00 for service of process at one address. The time in not broken down so as to provide information regarding how much time is spent in transportation, how much time was spent on the clerical jobs of mailing and affidavit preparation and what else the process server was doing to warrant a billing rate of three hundred dollars per hour. This billing rate is in excess of that charged by the most senior attorney billed in this case despite the fact that the testimony was that this is "an in-house process server." The $1,200.00 is awarded at the reduced rate of $300.00.
Considering the opacity of the billing records, the paucity of the testimony given at the fee hearing and the delays occasioned by the petitioner's attorneys, I can find support for $25,360.00 in attorneys' fees. This sum includes 87.3 hours of senior attorney work at $275.00 per hour, 2.7 hours of junior attorney work at $250.00 per hour and $677.50 in paralegal work.
Disbursements in the amount of $4,449.89 are also awarded due to the reduction to three hundred dollars for the petitioner's in house process server. Petitioner is therefore awarded a total amount of $29,809.89 in attorneys' fees and disbursements.