Opinion
July 6, 1967
Judgment unanimously reversed, on the law and the facts, with $50 costs and disbursements to plaintiff, and the matter is remanded for assessment of damages. On the prior appeal of this matter this court, in effect, held that it was the defendant that breached the contract and not the plaintiff, stating in part as follows: "it appears that, prior to the time the defendants were claiming a breach by the plaintiff of the advertising clause in the theatre agreement, the defendants themselves had broken and were repudiating the contract." ( Liza Co. v. Mark Hellinger Theatre, 19 A.D.2d 288, 294.) Furthermore, referring to the defendants, this court said that "They had already determined to end the theatre agreement, and the claim of the advertising breach was also a mere afterthought seized upon by them in an effort to justify a position which they had already assumed." ( Liza Co. v. Mark Hellinger Theatre, supra, p. 294.) It is quite true, as stated by Special Term in its present decision, that "The judgment of the Appellate Division did not adjudge that plaintiff was entitled to damages." Accordingly, the trial court approached the question as to whether the defendant was entitled to damages for the first time. It came to the conclusion that the plaintiff was not entitled to damages and, consequently dismissed the complaint. We believe that the complaint should not have been dismissed. The law is well settled that one may not recover damages caused by the entry of a judgment "erroneously granted unless the case was one of malicious prosecution". ( City of Yonkers v. Federal Sugar Refining Co., 221 N.Y. 206, 208.) However, there is nothing in the law to protect a defendant from liability for damages if those damages were sustained as a consequence of breaches committed prior to the entry of the erroneous judgment, and quite apart thereof. Such, we believe, is the situation here. We find that the damages complained of by the plaintiff were caused by the prior breaches of this defendant and were not the consequence of the entry of the judgment. The cessation of the advance sales of tickets, which occurred long prior to the entry of judgment, in violation of the defendant's contractual obligation to do so, caused damage to the plaintiff. Consequently, that in and of itself mandates a reversal of the judgment dismissing the complaint. Moreover, the record here sustains a finding that the defendant was obliged to move irrespective of the judgment because the breaches of the defendant had put the defendant in such a position that made removal an economic necessity. Accordingly, the complaint should not have been dismissed, but the amount of the damages sustained by the plaintiff should have been determined. As an additional reason for refusing to grant judgment for the plaintiff, the trial court stated that "the plaintiff failed to minimize its damages when it failed to apply for a stay upon its appeal". The only effect a stay could have had was to enable the defendant to remain in possession of the theatre pending appeal from the judgment entered. However, since the removal became necessary because of the prior breaches, a stay, even if it were applied for and granted, would not have tended to minimize the damages.
Concur — Steuer, J.P., Capozzoli, Tilzer, Rabin and McGivern, JJ.