Summary
In Eden Roc, the First Department found that HMA at issue was, indeed, a personal services contract, and therefore was exempt from injunctive relief.
Summary of this case from IHG Mgmt. (Md.) LLC v. W. 44th St. Hotel LLCOpinion
2013-03-26
MARRIOTT INTERNATIONAL, INC., et al., Plaintiffs–Respondents, v. EDEN ROC, LLLP, Defendant–Appellant.
Pryor Cashman LLP, New York (Todd E. Soloway of counsel), for appellant. Venable LLP, New York (Edward P. Boyle of counsel), for respondents.
Pryor Cashman LLP, New York (Todd E. Soloway of counsel), for appellant. Venable LLP, New York (Edward P. Boyle of counsel), for respondents.
GONZALEZ, P.J., SWEENY, RENWICK, MANZANET–DANIELS, ROMÁN, JJ.
Order, Supreme Court, New York County (Melvin L. Schweitzer, J.), entered on or about November 7, 2012, which granted plaintiffs' motion for a preliminary injunction and set an undertaking in the amount of $400,000, unanimously modified, on the law, to the extent of vacating the injunction, and otherwise affirmed, without costs.
In this action for breach of contract between plaintiff hotel manager and defendant hotel owner, plaintiff seeks to maintain the status quo by precluding defendant from interfering with its management of the hotel. The parties' detailed management agreement places full discretion with plaintiffs to manage virtually every aspect of the hotel. Such an agreement, in which a party has discretion to execute tasks that cannot be objectively measured, is a classic example of a personal services contract that may not be enforced by injunction ( see e.g. Wien & Malkin LLP, v. Helmsley–Spear, Inc., 12 A.D.3d 65, 71–72, 783 N.Y.S.2d 339 [1st Dept. 1991], revd. on other grounds, 6 N.Y.3d 471, 813 N.Y.S.2d 691, 846 N.E.2d 1201 [2006][property management agreement a personal services contract]; Woolley v. Embassy Suites, Inc., 227 Cal.App.3d 1520, 1534, 278 Cal.Rptr. 719 [Cal. App. 1st Dist. 1991]; Restatement 2d of Contracts, § 367).
While it is unnecessary to reach the question, we note that, contrary to defendant's contention, the agreement is not an agency agreement. Defendant lacks control over plaintiff, the alleged agent, since the agreement provides for plaintiff to have unfettered discretion in managing the hotel's operations ( see Gulf Ins. Co. v. Transatlantic Reins. Co., 69 A.D.3d 71, 96–97, 886 N.Y.S.2d 133 [1st Dept. 2009] ).
Defendant failed to present evidence that the $400,000 undertaking was not rationally related to its potential damages (Kazdin v. Putter, 177 A.D.2d 456, 576 N.Y.S.2d 516 [1st Dept. 1991].