Opinion
9965/2009.
Decided March 31, 2011.
Plaintiff Pro Se: David Doo .
Hsu Law Associates, PLLC, Flushing, NY, for the Defendant John Chen.
Lewis, Brisbois, Bisgaard Smith, LLP, by Karen Campbell, Jura Zibas, Marsha E. Harris, Esqs., New York, NY, for the Defendants Sie-En Yu, Fen-Feng Sung, Teresa Young, Steve Goldin, Jack Shen, Wen-Ruh Chen, Jane Yeh, and Timothy Chen (aka Chun Neu Chen).
Pro se plaintiff David Doo commenced this action against several former and current members of the board of managers of the Park Regent Condominium. This condominium premises, located at 41-25 Kissena Boulevard in Flushing, Queens County, New York, is a mixed-use premises which includes residential, commercial and professional units, as well as a garage. The plaintiff is the owner of a unit in the subject condominium and seeks to recover damages from the defendants, individually and in their capacities as members of the condominium board, for various acts of alleged willful misconduct, fraud and breach of their fiduciary duty as directors of the condominium from 2003 and continuing to the date of commencement of this action. This case is one of many actions that has been commenced in a series of on-going disputes between the plaintiff and various past and present members of the subject condominium board.
The complaint herein was filed in April 2009, and it asserts twenty five causes of action. The first, third through sixth, fourteenth, sixteenth, nineteenth, twentieth, twenty second, twenty third, and twenty-fourth causes of action allege fraud. The second, eighth, ninth, tenth, and seventeenth causes of action sound in fraud and breach of fiduciary duty. The seventh, eleventh through fifteenth, and eighteenth causes of action allege breach of fiduciary duty.
The twenty-first cause of action alleges that a certain action brought by the defendants, bearing Queens County Index Number 14404/06, constituted a Strategic Lawsuit Against Public Participation ["SLAPP"] suit and seeks a judgment declaring that certain defendants abused condominium funds for their litigation, that the condominium should recover legal fees from the defendants and that the issue must be submitted to arbitration in accordance with the condominium's by laws. Finally, the twenty-fifth cause of action alleges conversion.
Defendants Sie-En Yu, Fen-Feng Sung, Teresa Young, Steve Goldin, Jack Shen, Wen-Ruh Chen, Jane Yeh, and Timothy Chen (aka Chun Neu Chen) move to dismiss the complaint against them in its entirely. Plaintiff David Doo made a cross motion for sanctions against the defendants and their attorney Marsha Harris, Esq. The pro se plaintiff also moved for a default judgment against defendant John Chen for failing to answer the complaint and appear at a June 8, 2009 preliminary conference. Plaintiff also filed a motion for an award of partial summary judgment in his favor and against the defendants on the sixth, eleventh, twelfth, fourteenth, fifteenth, sixteenth, seventeenth, eighteenth, and twenty-first causes of action alleged in the complaint.
The moving defendants seek leave to renew their prior motion to dismiss the complaint, which was denied as a result of their failure to attach a copy of the complaint, in its entirety. The defendants' motion to dismiss the complaint is now made upon proper papers and, therefore, leave to renew the motion to dismiss is hereby granted.
The defendants, upon the foregoing papers, seek dismissal of the complaint against them on one or more of the following grounds:
(1) plaintiff's claims should have been brought pursuant to Article 78 and are barred by the four-month statute of limitations period applicable to Article 78 proceedings;
(2) plaintiff's breach of fiduciary duty claims are barred by a three-year statute of limitations period;
(3) plaintiff's first cause of action is the subject of a pending action entitled In the Matter of the Application of Anna Chang, et al. v John Chen, et al., bearing Queens County, Index Number 5268/2008;
(4) plaintiff's claims are barred by collateral estoppel as each claim has been fully litigated in the following actions: In the Matter of David Doo, et al. v Board of Managers of Park Regent Condominium, et al., bearing Queens County Index Number 28395/2006; Matter of Doo v The Park Regent Condominium; Board of Managers and Board of Managers of the Park Regent Condominium v Park Regent Associates, a/k/a Park Regent Unit Owners Association, bearing Queens County Index Numbers 20502/05 and 20104/05; Board of Managers of Park Regent Condominium v Park Regent Unit Owners Associates, a/k/a Park Regent Unit Owners Association, et al., bearing Queens County, Index Number 14404/06; and
(5) plaintiff's claim that defendant Steven Goldin does not own the requisite amount of shares in the subject condominium to appoint a Board Member is belied by a letter written by defendant Goldin in which he refutes such claim (annexed as Exhibit G to the defendant's motion papers).
As an initial issue, the Court rejects the moving defendants' contention that this action must be dismissed because it was not brought as an Article 78 proceeding. This action could not have been properly asserted in a proceeding brought pursuant to Article 78 because the plaintiff is not seeking to enforce an obligation, and the matter is not in the nature of mandamus ( cf., Brasseur v Speranza , 21 AD3d 297 ). Therefore, the four-month limitations period prescribed by CPLR 217 is inapplicable herein. Accordingly, that branch of the defendant's motion which seeks dismissal of the complaint on this basis is denied.
Turning to the substance of causes of action asserted in the complaint, the plaintiff's first cause of action alleges fraud as against defendants John Chen, Timothy Chen, Wen-Ruh Chen, and Sie-EnYu arising from their misrepresentations, inter alia, that defendants John Chen and Wen-Ruh Chen repaid an unauthorized loan of $570,000 that they had taken from the condominium's reserve fund. As asserted by the defendants, an identical claim has been alleged against these parties by the plaintiff, and others, in a prior action pending, entitled In the Matter of the Application of Anna Chang, et al. v John Chen, et al., bearing Queens County Index Number 5268/2008. CPLR 3211(a)(4) authorizes dismissal of any action or claim if another action is pending involving the same parties and issue. As such, the plaintiff's first cause of action is hereby severed and dismissed ( see generally, JC Mfg., Inc. v NPI Elec., Inc., 178 AD2d 505 [2nd Dept. 1991]; cf., BT Triple Crown Merger Co., Inc. v Citigroup Global Markets ,19 Misc 3d 1124 [A], 2008 NY Slip Op 50841[U] [Sup Ct New York County 2008]).
The second cause of action alleges fraud against defendants John Chen, Timothy Chen, Wen-Ruth Chen and Sie-En Yu arising out of their alleged misuse of condominium parking areas to operate their own parking company and build an 800-square foot video rental store on the premises for their personal gain from 2003 and on-going. The defendants contend that this cause of action should be dismissed as time-barred. In seeking dismissal of a cause of action pursuant to CPLR 3211(a)(5) on the ground that it is barred by the applicable statute of limitations, the defendant bears the initial burden of establishing prima facie that the time in which to sue has expired ( see, Sabadie v Burke , 47 AD3d 913 [2nd Dept. 2008]; Savarese v Shatz, 273 AD2d 219 [2nd Dept. 2000]).
Contrary to the defendants' contentions, under New York law, a cause of action based upon fraud must be commenced within six years from the time of the fraud or within two years from the time the fraud was discovered, or with reasonable diligence, could have been discovered, whichever is longer (CPLR 213(8); Chang v Wang, 79 AD3d 693 [2nd Dept. 2010]). The moving defendants have failed to establish that the second cause of action alleging fraud is time-barred. Accordingly, that branch of the defendants' motion seeking dismissal of the second cause of action is denied.
The third cause of action alleges fraud against defendants Sie-EnYu and Teresa Young for allegedly forging unit owners' signatures on a November 18, 2004 petition to falsely establish that the quorum required for holding a special meeting under the bylaws had been met and seeks a judgment, inter alia, declaring that the 2004 petition is invalid. The moving defendants contend that the third cause of action for fraud is governed by either a four-month or three-year limitations period and, thus, should be dismissed as time-barred. Contrary to the defendants' contention, the applicable limitations period for the claims asserted within the third cause of action for fraud is six-years as prescribed by CPLR 213(8). Thus, since the complaint was filed in April 2009, the moving defendants have not established that this claim is time-barred. Accordingly, that branch of the motion which seeks to dismiss the third cause of action for fraud is denied ( see, Chang v Wang, 79 AD3d 693, supra).
The fourth cause of action alleges fraud against defendant Steven Goldin, one of the condominium's sponsors, for falsely representing to the condominium unit owners that he and co-sponsor Norman Buchbinder owned more than five percent of the common interest of all units, as required by the bylaws in order to designate three representatives to serve on the board of directors. It is also alleged therein that the real estate records for the units owned by the sponsors demonstrate the alleged fraud. That branch of the moving defendants' motion to dismiss the fourth cause of action for failure to state a cause of action is granted. With respect to this claim, the Court finds that it fails to state a cause of action for fraud because any reliance by the plaintiff upon alleged misrepresentation by defendant Goldin of his ownership interest was not reasonable as a matter of law because said alleged misrepresentation was a matter of public record at the time it was made ( Rozen v 7 Calf Creek , LLC, 52 AD3d 590 [2nd Dept. 2008]; see generally, Smith v Smith, 29 Misc 3d 1226(A), 2010 NY Slip Op 52002[U], 2010 WL 4723452 [Sup Ct New York County 2010]; cf., Carr v Neilson , 77 AD3d 877 , lv. to appeal denied, 2011 WL 65216, 2011 NY Slip Op 64881 [2011]). Accordingly, the fourth cause of action is hereby severed and dismissed.
The fifth cause of action alleges fraud against defendants Sie-En Yu and Steven Goldin, inter alia, for forging unit owners' proxies and conducting a condominium board election on December 18, 2004. Contrary to the moving defendants' contention, this claim was timely made within the applicable six-year statute of limitations period (CPLR 213). Accordingly, that branch of the moving defendants' motion which seeks to dismiss the fifth cause of action is denied.
The sixth cause of action alleges fraud against defendants Sie-En Yu, Fen-Feng Sung and Teresa Young for making false representations to the court in an action entitled David Doo v The Park Residential Assoc. et. al., bearing Queens County, Index Numbers 20502/05 and 20104/06. The plaintiff alleges that the facts misrepresented in those cases would have resulted in a different decision therein. Under the circumstances of the alleged fraud, the plaintiff's remedy is a motion to renew or an appeal of the decision in the prior action. Accordingly, the sixth cause of action is hereby severed and dismissed for failure to state a cause of action upon which relief may be granted.
The seventh cause of action alleges breach of fiduciary duty against defendants Sie-En Yu and Fen-Feng Sung for violating the bylaws by delaying the cleaning of an oil spill in the basement of the condominium premises for eight months and allowing the condominium's management agent, Benchmark Associaters, to award the contract for the clean-up to a contractor at an excessively higher price than originally offered to the condominium by a different contractor. The moving defendants contend that this cause of action must be dismissed because the actions complained of by the plaintiff are protected by the business judgment rule. "The business judgment rule bars judicial inquiry into actions of corporate directors taken in good faith and in the exercise of honest judgment in the lawful and legitimate furtherance of corporate purposes" ( Sacher v Beacon Associates Management Corp., 27 Misc 3d 1221(A), 2010 NY Slip Op 50826[U] [Sup Ct Nassau County 2010]; see, Schoninger v Yardarm Beach Homeowners Ass'n, Inc., 134 AD2d 1 [2nd Dept. 1987]).
"Questions of policy of management, expediency of contracts or action, adequacy of consideration, lawful appropriation of corporate funds to advance corporate interests, are left solely to their honest and unselfish decision, for their powers therein are without limitation and free from restraint, and the exercise of them for the common and general interests of the corporation may not be questioned, although the results show that what they did was unwise or inexpedient" ( Auerbach v Bennett, 47 NY2d 619, 629 quoting, Pollitz v Wabash R.R. Co., 207 NY 113). Providing the plaintiff the benefit of every possible favorable inference, as the Court must do on a motion to dismiss made pursuant to CPLR 3211 ( Leon v Martinez, 84 NY2d 83), the Court must conclude that the actions complained of herein are insulated by the business judgment rule. Accordingly, the seventh cause of action is hereby severed and dismissed.
The eight and ninth causes of action allege fraud and breach of fiduciary duty against defendants Timothy Chen, Sie-En Yu and Fen-Feng Sung for (a) failing to take corrective action and (b) causing the condominium to violate the provisions of its certificate of occupancy, respectively, when a residential space was converted to commercial use and rented to a supermarket in violation of the bylaws. The tenth cause of action asserted against defendant Fen-Feng Sung alleges that she further committed fraud and breached her fiduciary duty as a director by failing to object to the rental of the subject space and concealing said transaction. It is also alleged in the complaint that twenty-three unit owners filed an action regarding these allegations of misconduct in an action entitled In the Matter of the Application of Anna Chang, et al. v John Chen, et al., bearing Queens County, Index Number 5268/2008, which is a pending action. Plaintiff David Doo is a plaintiff therein and defendants Timothy Chen, Sie-En Yu, and Fen-Feng Sung are parties in that action as well. As a result of the foregoing, the eighth, ninth, and tenth causes of action are hereby severed and dismissed on the ground that a prior action involving the same allegations and for the same relief is pending (CPLR 3211[a][4]; see generally, JC Mfg., Inc. v NPI Elec., Inc., 178 AD2d 505, supra).
The eleventh cause of action alleges breach of fiduciary duty against defendants Sie-En Yu, Fen-Feng Sung, Wen-Ruh Chen and Timothy Chen arising from their failure to remedy various Environmental Control Board ("ECB") violations on the premises from 2003 and on-going, and seek monetary damages as a result thereof. The twelfth cause of action similarly sounds in breach of fiduciary duty against defendants Fen-Feng Sung and Wen-Ruh Chen for failing to cure ECB violations in their own units for the six years preceding the commencement of this action. The moving defendants contend that these causes of action must be dismissed as barred by the three-year limitations period.
The statute of limitations for a breach of fiduciary duty claim is six years if the relief sought is equitable, and it is three years if the relief sought is monetary ( Kaufman v Cohen, 307 AD2d 113 [1st Dept. 2003]). Where the breach of fiduciary duty claim is based on fraud, a six-year statute of limitations controls, regardless of the relief sought ( see, Boltin v Lavrinovich , 28 Misc 3d 1217[A], 2010 WL 3033751 [Sup Ct New York 2010]). Since the relief sought herein is monetary, and the plaintiff's allegations do not make out a cause of action for fraud, the claims asserted within the eleventh and twelfth causes of action regarding the defendants' failure to cure ECB violations existing more than three years before the April 16, 2009 commencement of this action are barred by the three-year limitations period. Accordingly, such expired claims contained within the eleventh and twelfth causes of action are hereby severed from those claims which have been timely asserted and dismissed.
The thirteenth cause of action alleges breach of fiduciary duty against defendants Sie-En Yu and Fen-Feng Sung for contracting with Benchmark Management for management services and delegating the duty to negotiate and award contracts on behalf of the condominium to it. This claim was previously determined by the court in the prior action entitled David Doo v The Park Residential Assoc., et al., bearing Queens County, Index Numbers 20502/05 and 20104/05 wherein the issue was decided that the board's decision on the subject matter was fully protected by the business judgment rule. Accordingly, the thirteenth cause of action is hereby severed and dismissed on res judicata grounds ( see, Pawling Lake Property Owners Association, Inc. v Greiner , 72 AD3d 665 [2nd Dept. 2010]).
Although the fourteenth cause of action alleges fraud and bad faith against defendants Sie-En Yu, Teresa Young, Fen-Feng Sung and Steven Goldin for allegedly blocking an October 12, 2005 election and illegally comprising the 2006 temporary board without an election, his claim sounds in one for breach of fiduciary duty for which he seeks monetary damages. The defendants contend that this cause of action must be dismissed as time-barred. "The statute of limitations for a breach of fiduciary duty claim is six years if the relief sought is equitable, and three years if the relief sought is monetary ( Kaufman v Cohen, 307 AD2d 113, supra). The plaintiff's claim invokes the three-year limitations period, which expired in October 2008. As such, this cause of action is hereby severed and dismissed as time-barred.
The fifteenth cause of action alleges fraud, bad faith, and breach of fiduciary duty against defendants Sie-En Yu and Theresa Young for allegedly appointing a non-unit owner, defendant Jack Shen, as a 2006 Temporary Board member in violation of section 2.7 of the condominium bylaws to replace Di Xon Yuan, a unit owner who quit the board of managers in or around September 2005. It is further alleged that they knowingly misrepresented to the unit owners that defendant Shen was qualified to be a board member.
The sixteenth cause of action alleges fraud and bad faith against defendant Shen for intentionally deceiving unit owners that he was qualified to be a member of the condominium board although he was not a unit owner as required by the condominium bylaws and seeks a declaration that defendant Shen was not qualified to be a board member for the period in question.
In light of the fact that the issue concerning defendant Shen's qualification to serve as a board member was determined in a prior related action entitled Matter of Doo v Board of Managers of Park Regent Condominium ( 58 AD3d 627 [2nd Dept. 2009]), that branch of the moving defendants' motion which seeks dismissal of the fifteenth and sixteenth causes of action must be granted on collateral estoppel grounds. "Under the doctrine of collateral estoppel [or issue preclusion], a party is precluded from relitigating an issue which has been previously decided against him in a prior proceeding where he had a full and fair opportunity to litigate such issue" ( Lockitt v Booker , 80 AD3d 700 [2nd Dept. 2011]). "The two elements that must be satisfied to invoke the doctrine of collateral estoppel are that (1) the identical issue was decided in the prior action and is decisive in the present action, and (2) the party to be precluded from relitigating the issue had a full and fair opportunity to contest the prior issue" ( Luscher ex rel. Luscher v Arrua, 21 AD3d 1005 [2nd Dept. 2005]). Both elements are present herein. Accordingly, the fifteenth and sixteenth causes of action are hereby severed and dismissed.
The seventeenth cause of action alleges fraud, bad faith and breach of fiduciary duty against defendant Teresa Young for destroying a petition signed by 87 unit owners which was delivered to her home on August 24, 2005 for the purpose of requiring her to call a meeting of the residential unit owners. The moving defendants seek dismissal of the cause of action on the ground that this issue was the subject of previous litigation entitled Matter of Doo v The Park Regent Condominium; Board of Managers and Board of Managers of the Park Regent Condominium v Park Regent Associates, a/k/a Park Regent Unit Owners Association, bearing Queens County, Index Numbers 20502/05 and 20104/05. The court ruled against the plaintiff on the issue in that matter. Thus, the plaintiff is collaterally estopped from relitigating the issue. Accordingly, the seventeenth cause of action is hereby severed and dismissed ( see, Luscher ex rel. Luscher v Arrua, 21 AD3d 1005, supra).
The eighteenth cause of action alleges breach of fiduciary duty against defendants Sie-En Yu and Teresa Young for failing to send out a meeting notice regarding a June 26, 2006 annual election. In his complaint, the plaintiff also correctly asserts that the Court issued a decision in a related matter, entitled Board of Managers of Park Regent Condominium v Park Regent Unit Owners Associates, bearing Queens County, Index Number 14404/2006, in which the Appellate Division later determined, on January 13, 2009, that the election held on June 26, 2006 was invalid due to the absence of an official meeting notice. Since the meeting notice was the subject of the prior court decision and the plaintiff was also party to that action, he had a full and fair opportunity to litigate this issue at that time. Under the circumstances presented, his failure to do so does not permit him to relitigate the issue herein. Thus, the plaintiff is collaterally estopped from asserting the issue ( see, Luscher ex rel. Luscher v Arrua, 21 AD3d 1005, supra). Accordingly, the eighteenth cause of action is hereby severed and dismissed.
The nineteenth cause of action alleges fraud against defendant Sie-En Yu, Teresa Young and Wen-Ruh Chen for filing a lawsuit in an effort to delay the June 26, 2006 election and allegedly cancelling the June 26, 2006 meeting at the last minute based upon the false reason that they were waiting for a decision on a motion they filed to restrain the subject election, which had been rendered on June 22, 2006. This cause of action does not state a claim for fraud ( see generally, Barclay Arms v Barclay Arms Assoc., 74 NY2d 644; Barns Farms Realty, LLC v Novelli, ___ AD3d ___, 2011 WL 752625 [2nd Dept. 2011]).
Moreover, the plaintiff's reliance upon the alleged misrepresentation was not justified because the representation as to whether or not a decision on a particular motion had been rendered was a matter of public record that could have been easily verified by the plaintiff ( Rozen v 7 Calf Creek , 52 AD3d 590 , supra; see, Fariello v Checkmate Holdings, LLC, ___ AD3d ___, 2011 WL 722525, 2011 NY Slip Op 01592 [1st Dept. 2011]; Northeast Steel Products, Inc. v John Little Designs, Inc. , 80 AD3d 585 [2nd Dept. 2011]; see generally, Lama Holding v Smith Barney, 88 NY2d 413). As a result, the nineteenth cause of action is hereby severed and dismissed.
The twentieth cause of action alleges fraud against defendants Sie-En Yu and Wen-Ruh Chen for failing to inform the plaintiff and plaintiff's counsel about a scheduled preliminary conference and a compliance conference in the case bearing Queens County, Index Number 8919/06 and seeks a judgment directing the defendants to provide them with any orders resulting from the discovery conferences and voiding any decision issuing therefrom which is binding on the residential condominium owners. The twentieth cause of action is also hereby severed and dismissed for failure to state claim for fraud ( Rozen v 7 Calf Creek , 52 AD3d 590 , supra; Fariello v Checkmate Holdings, LLC, ___ AD3d ___, 2011 WL 722525, 2011 NY Slip Op 01592, supra).
The twenty-first cause of action against defendants Sie-En Yu, Fen-Feng Sung, Teresa Young and Steven Goldin alleges that the Queens County action previously filed by them, entitled Board of Managers of Park Regent Condominium v Park Regent Unit Owners Associates, a/k/a Park Regent Union Owners Association, et al., and bearing Queens County, Index Number 14404/06, constituted a retaliatory SLAPP suit against him and other members of a 2006 contested board of managers.
New York's anti-SLAPP statute is found in Civil Rights Law sections 70-a and 76-a. Section 70-a(1)(a) provides, in pertinent part:
[a] defendant in an action involving public petition and participation, as defined in paragraph (a) of subdivision one of section seventy-six-a of this article, may maintain an action, claim, cross claim or counterclaim to recover damages, including costs and attorney's fees, from any person who commenced or continued such action, . . . [if that action] involving public petition and participation was commenced or continued without a substantial basis in fact and law and could not be supported by a substantial argument for the extension, modification or reversal of existing law.
Id. section 70-a(1)(a).
Civil Rights law section 76-a defines "[a]n action involving public petition and participation,'" in pertinent part, as "an action . . . for damages that is brought by a public applicant or permittee." Id. section 76-a(1)(a). The statute defines "public applicant or permittee" as
any person who has applied for or obtained a permit, zoning change, lease, license, certificate or other entitlement for use or permission to act from any government body, or any person with an interest, connection or affiliation with such person that is materially related to such application or permission.
Id. section 76-a(1)(b).
The New York Court of Appeals has noted that the enactment of the anti-SLAPP statute in 1992 was prompted by
a rising concern about the use of civil litigation, primarily defamation suits, to intimidate or silence those who speak out at public meetings against proposed land use development and other activities requiring approval of public boards. Termed SLAPP suits — strategic lawsuits against public participation — such actions are characterized as having little legal merit but are filed nonetheless to burden opponents with legal defense costs and the threat of liability and to discourage those who might wish to speak out in the future.
600 West 115th Street Corp. v Von Gutfield, 80 NY2d 137 n. 1 [1992], recently quoted with approval by the United States Court of Appeals for the Second Circuit in Chandok v Klessig, 632 F3d 803 .
The anti-SLAPP provisions of Civil Rights Law sections 70-a and 76-a were designed "to protect citizen activists from lawsuits commenced by well-financed public permit holders in retaliation for their public advocacy" ( Guerrero v Carva , 10 AD3d 105 , 116 [1st Dept. 2004]). "A SLAPP suit defendant must directly challenge an application or permission in order to establish a cause of action under the Civil Rights Law" ( Foley v CBS Broadcasting, Inc., 28 Misc 3d 1227(A), 2006 WL 6619947, 2006 NY Slip Op 52712[U] [Sup Ct New York County 2006]; see, Chandok v Klessig, 632 F3d 803, supra; Novosiadlyi v James , 70 AD3d 793 [2nd Dept. 2010]; Cholowsky v Civiletti ,69 AD3d 110 [2nd Dept. 2009]; Bridge capital Corp. v Ernst , 61 AD3d 496 [1st Dept], lv. to appeal denied, 2009 WL 1851281, and motion for stay dismissed, 12 NY3d 906; Singh v Sukhram , 56 AD3d 187 [2nd Dept. 2008]; Gordone v Marrone, 155 Misc 2d 726, 735-736 [Sup Ct Westchester County 1992] ["SLAPP suits . . . are suits without substantial merit that are brought by private interests to stop citizens from exercising their political rights and to punish them for having done so'"; quoting an article, citation omitted]), aff'd, 202 AD2d 104 [2nd Dept. 1994], lv. to appeal denied, 84 NY2d 813; Terry Rice, "Legislation Provides Prompt Review of SLAPP Suits," NYLJ, Dec. 13, 1993, at 1, col. 1; see generally, Richard Raysman Peter Brown, "Online Defamation and Anonymous Defendants," NYLJ, Feb. 9, 2010, at 5, col. 1).
The papers submitted on this motion demonstrate that the present action is not a SLAPP suit. Rather, the action was commenced to determine the legitimacy of an election, whereupon the purported election of the plaintiff herein to the condominium board of managers was invalidated by a court. The purposes for which New York's therapeutic anti-SLAPP statutes were enacted in 1992 are not implicated in this action. Under the circumstances regarding this cause of action, the Court finds that the plaintiff's claim fails to state a claim upon which relief may be granted ( see CPLR 3211[a][7]). Accordingly, the twenty-first cause of action is hereby severed and dismissed.
The twenty-second cause of action asserts a claim for fraud against defendants Sie-En Yu, Fen-Feng Sung, Teresa Goldin, Jack Shen, Wen-Ruh Chen and Jane Yeh. The plaintiff alleges that these defendants lied to the court during the course of a prior action and that, as a result of their false representations, the petition he filed in that matter was erroneously dismissed by the court. Inasmuch as the plaintiff cannot claim that the alleged misrepresentations were made with a view toward inducing him to act, this cause of action fails to state a claim for fraud ( see, Fariello v Checkmate Holdings, LLC, ___ AD3d ___, 2011 WL 722525, 2011 NY Slip Op 01592, supra; Northeast Steel Products, Inc. v John Little Designs, Inc. , 80 AD3d 585 , supra; see also, Lama Holding v Smith Barney, 88 NY2d 413, supra). Accordingly, the twenty-second cause of action is hereby severed and dismissed.
The twenty-third cause of action alleges fraud against defendants Sie-En Yu, Fen-Feng Sung, Teresa Young, Steven Goldin, Jack Shen, Wen-Ruh Chen, and Jane Yeh for failing to follow the required procedures under the bylaws for holding an annual meeting and having a quorum present. Thus, the plaintiff contests the legitimacy of the October 3, 2007 board of managers election and seeks to have it invalidated by the Court.
The twenty-fourth cause of action alleges fraud against defendants Sie-En Yu, Fen-Feng Sung, Teresa Young, Steven Goldin, Jack Shen, Wen-Ruh Chen, and Jane Yeh for failing to follow the required procedures under the bylaws for holding an annual meeting and claims, inter alia, that they did not have a quorum present. The plaintiff contests the legitimacy of the October 29, 2008 board of managers election and seeks to have it invalidated by the Court. Contrary to the moving defendants' contentions, this action was not required to be brought as an Article 78 proceeding ( cf., Board of Managers of Park Regent Condominium, etc. v Park Regent Unit Owners Associates, a/k/a Park Regent Unit Owners Association , 58 AD3d 589 [2nd Dept. 2009]). Accordingly, those branches of the defendants' motion which seek dismissal of the plaintiff's twenty-third and twenty-fourth causes of actions are denied.
The twenty-fifth cause of action alleges conversion against defendants Sie-En Yu, Fen-Feng Sung, Teresa Young, Steven Goldin, Jack Shen, Wen-Ruh Chen, and Jane Yeh for improperly calling board meetings by illegitimate boards in violation of the condominium's by laws. "A conversion takes place when someone, intentionally and without authority, assumes or exercises control over personal property belonging to someone else, interfering with that person's right of possession" ( Dickinson v Igoni , 76 AD3d 943 [2nd Dept. 2010]; see, Klepetko v Reisman , 41 AD3d 551 [2nd Dept. 2007]). The plaintiff's allegations do not constitute a claim for conversion ( see, Vigilant Ins. Co. of Am v Housing Authority, 87 NY2d 36). Thus, this cause of action must be dismissed for failure to state a cause of action ( see, Paino v Kaiyes Realty, LLC, 30 Misc 3d 1213[A], 2011 NY Slip Op 50056[U] [Sup Ct Richmond County 2011]). Accordingly, the twenty-fifth cause of action is hereby severed and dismissed.
Since New York state courts have a policy committing to resolve actions on their merits ( see, Toyota Motor Credit Corp. v Impressive Auto Ctr. , 80 AD3d 861 [3rd Dept. 2011]; Westchester Med. Ctr. v Allstate Ins. Co. , 80 AD3d 695 [2nd Dept. 2011]; Davidson v Straight Line Contractors, Inc. , 75 AD3d 1143 [4th Dept. 2010]; Kitts v Blossom North, LLC , 70 AD3d 1339 [4th Dept. 2010]; Shapiro v Chawla , 55 AD3d 898 [2nd Dept. 2008]; Perez v Travco Ins. Co. , 44 AD3d 738 [2nd Dept. 2007]; 2M Realty Corp. v Boehm , 13 AD3d 361 [2nd Dept. 2004]; Johnson v NYCHA Law Dept., 23 Misc 3d 1109[A], 2009 NY Slip Op 50643[U] [NYC Civ Ct Kings County 2009]), and, in light of the fact that defendant John Chen has already served his answer and participated in discovery in this action, the plaintiff's motion for a default judgment against defendant John Chen for serving a late answer to the complaint and failing to appear at a preliminary conference on June 8, 2009 is, in all respects, denied. Further, defendant Chen's answer shall be deemed served and filed nunc pro tunc.
In light of the foregoing, the plaintiff's motion for an award of partial summary judgment in his favor and against the defendants on the sixth, eleventh, twelfth, fourteenth, fifteenth, sixteenth, seventeenth, eighteenth, and twenty-first causes of action alleged in his complaint is in all respects denied as moot.
Finally, the plaintiff's cross motion for an award of sanctions against the defendants' attorney for frivolous conduct is denied as meritless.
The foregoing constitutes the decision, order, and opinion of the Court.