Opinion
Index No. LT-300069-22/RI
05-02-2022
Victory Blvd Associate LLC, Petitioner-Landlord, v. SBSG Partners, LLC, Corner ground and second floor retail and warehouse space located in the building known as 2204-2210 Victory Boulevard in the borough of Staten Island, Richmond County in the City and State of New York, Respondent-Tenant, and "JOHN DOE" and "JANE DOE", Respondents-Undertenants, Names of undertenants John Doe and Jane Doe being fictious and unknown to petitioners but intended to describe persons or entities in possession of the premises herein described.
Plaintiff's Counsel Leon Isidore Behar Rosenberg & Steinmetz PC Defendant's Counsel Wenig & Saltiel LLP
Unpublished Opinion
Plaintiff's Counsel Leon Isidore Behar Rosenberg & Steinmetz PC
Defendant's Counsel Wenig & Saltiel LLP
BRENDAN T. LANTRY, J.
Recitation, as required by CPLR §2219 (a), of the papers considered in the review of this application:
Papers/Numbered
Respondent-Tenant's Notice of Motion, Affirmation/Affidavit with annexed exhibits 1-2
Petitioner's Affirmation in Opposition with annexed exhibits 3
Respondent-Tenant's Reply 4
Respondent-Tenant SBSG Partners, LLC ("Respondent") moves this Court for an Order pursuant to CPLR §3101 and CPLR §406 granting it leave to conduct discovery with respect to Petitioner-Landlord Victory Blvd Associates LLC ("Petitioner") including discovery and inspection of documents and an examination before trial of Petitioner's managing member. The Court hereby grants the motion in part and denies the motion in part as follows.
According to the Petitioner, Respondent and HMF Affiliates, LLC ("HMF") executed a commercial lease on March 9, 2020 (the "Lease") regarding the corner ground and second floor retail and warehouse space at 2204-2210 Victory Boulevard (the "Premises"). Petitioner represents that it succeeded HMF as the landlord pursuant to an Assignment of Lease between HMF and Petitioner. Petitioner states that after Respondent ceased paying rent on or about February 1, 2021, Petitioner served Respondent with a Notice to Cure dated December 15, 2021. On or about December 23, 2021, the parties entered into a tolling agreement ("Tolling Agreement") under which the deadline previously provided in the Notice to Cure was extended to January 6, 2022. Based upon Respondent's alleged failure to timely cure the default, Petitioner served Respondent with a written notice informing it that the Lease was being terminated and that it was required to vacate the Premises on or before January 21, 2022. ("Termination Notice"). After Respondent did not vacate the Premises, the Petitioner commenced this holdover proceeding on or about January 25, 2022. Petitioner represents that Respondent currently owes over $450,000.00 in unpaid rent and use and occupancy.
In its motion before the Court, the Respondent argues that it has ample need for certain items of discovery that are relevant to Respondent's affirmative defenses. Along with its motion, Respondent submitted a Proposed Discovery and Inspection ("Proposed D & I") with ten document requests. Particularly, Respondent represents that it requires said discovery relating to the Petitioner's efforts to obtain certificates of occupancy as well as the Petitioner's representations regarding its construction payments and deliverance of equipment free of all liens. Respondent argues that it will suffer "extreme prejudice" if its application is denied since it will be unable to retrieve several of the documents that are fundamental to its defense in this matter and that are in the possession of the Petitioner. Upon oral argument, counsel for the Respondent represented to the Court that Respondent had been paying the rent required under the Lease and that it will continue doing so.
In opposition to the Respondent's motion, Petitioner maintains that Respondent has failed to demonstrate an "ample need" for the items listed in its Proposed D & I and that none of the affirmative defenses proffered by Respondent constitute a proper defense to this holdover proceeding. Petitioner further argues that the Proposed D & I is overly broad and requests documents that go beyond the scope of Respondent's defenses. According to the Petitioner, the motion should be denied as the requested discovery is not necessary for the affirmative defenses and is not carefully tailored as to clarify the disputed facts.
Discussion
"A summary proceeding pursuant to the Real Property Actions and Proceedings Law is a special proceeding in which disclosure may be utilized by leave of court, upon a showing of 'ample need.'" (Mautner-Glick Corp. v. Higgins, 64 Misc.3d 16, 18 [App Term 2019] (internal citations omitted); See CPLR §408. See also 603 New Jersey Ave., LLC v. Hall, 74 Misc.3d 137 (A) [App Term 2022]).
When determining whether the movant has established "ample need", courts consider several factors, "not all of which need to be present in every case." (Mautner-Glick Corp. v. Higgins, 64 Misc.3d 16, 18 [App Term 2019] (internal citations omitted)). Such factors include:
whether the party seeking discovery has asserted facts to establish a claim or defense; whether there is a need to determine information directly related to the claim or defense; whether the requested disclosure is carefully tailored and likely to clarify the disputed facts; whether prejudice will result from granting leave to conduct discovery; whether any prejudice caused by granting a discovery request can be diminished by an order fashioned by the court for that purpose; and whether the court, in its supervisory role, can structure discovery so that pro se tenants in particular will be protected. (Id. (citing New York Univ. v. Farkas, 468 N.Y.S.2d 807 [Civ. Ct., NY County 1983]). See also PRC Westchester Ave., LLC v. Feliciano, 65 Misc.3d 1062, 1066 [Civ Ct 2019]; Smilow v. Ulrich, 11 Misc.3d 179, 182 [Civ Ct 2005]).
"A motion for leave to conduct disclosure is not for a landlord's exclusive benefit. A tenant may also be granted similar relief if the disclosure demand reaches the ample-need threshold to defend against the proceeding." Smilow v. Ulrich, 11 Misc.3d 179, 182 [Civ Ct 2005]. Here, the Court finds that Respondent has met such burden with respect to certain demands. Based on the papers submitted with respect to this motion and the extensive oral arguments held, the Court finds that Respondent demonstrated an "ample need" to certain discovery requests, particularly with respect to the Petitioner's alleged efforts to obtain certificates of occupancy. While some of the initial discovery requests were overly broad, the Court has carefully tailored such requests and has denied any requests that are not directly related to Respondent's defense.
The Court further notes that during oral argument, counsel for Respondent stated that Respondent has been paying the rent and that Petitioner has accepted such rent. Petitioner's counsel argued that acceptance of such rent is not a bar to this summary proceeding, which was commenced prior to Petitioner's acceptance of the rent payments. While the acceptance of rent by the Petitioner may not be a bar to this proceeding, it was a factor considered by the Court in determining whether Petitioner will suffer prejudice if the Court were to grant the relief sought. Since Petitioner conceded that Respondent is paying rent, the Court found that any Petitioner would not suffer prejudice if the trial was delayed a few weeks to allow for the limited discovery listed below. Furthermore, the Court has determined that "any prejudice caused by granting a discovery request can be diminished by an order fashioned by the court for that purpose" and has determined that the Respondent has established that it has an ample need for the items listed below.
Therefore, Petitioner must serve the Respondent with the following documents by May 20, 2022, to the extent that said documents are in the Petitioner's possession:
(1) Any operating agreements in effect for the Petitioner LLC from January 2019 to the date of this Decision and Order;
(2) Copies of all records of conveyance or assignment of any interest in the Premises from Petitioner to HMF from January 1, 2019 to the date of this Decision and Order;
(3) Copies of all agreements, contracts, reports, applications, notices, violations and/or correspondence (letters, emails, texts and/or voicemails) between Petitioner and HMF, or any agent of either, and the City of New York or any other governmental agency with respect to the issuance of any Certificates of Occupancy regarding the Premises from January 1, 2019 to the date of this Decision and Order;
(4) Copies of any correspondence and invoices between Petitioner and any architect and correspondence between Petitioner and Respondent pertaining to "as-built" plans and the issuance of any Certificates of Occupancy with respect to the Premises from January 1, 2019 to the date of this Decision and Order;
(5) Copies of any application, correspondence, recording, or submission for recording of documents by Petitioner or HMF or any agent or assign to any agency of the City of New York with respect to any potential and issued Certificates of Occupancy pertaining to the Premises from January 1, 2019 to the date of this Decision and Order; and
(6) Proof of payment for all architects, engineers, contractors and/or any professional who were responsible to obtain any Certificates of Occupancy and/or "as-built" plans on behalf of the Petitioner and/or Respondent pertaining to the Premises from January 1, 2019 to the date of this Decision and Order.
As referenced in Section 3.1 of the Lease annexed as Exhibit A to Affidavit of Leonard Gekhman dated April 20, 2022.
However, Respondent has failed to provide sufficient need for a deposition of the Petitioner's Managing Member. Indeed, Respondent's motion is bereft of reference to said deposition, other than the Notice of Motion that simply cites the relief sought.
Accordingly, it is hereby
ORDERED that Petitioner must serve the Respondent with any of the documents listed to the extent Petitioner possesses such documents by May 20, 2022; it is further
ORDERED that the remainder of Respondent's motion, including the portion seeking an examination before trial of Petitioner's managing member, is hereby denied; and it is
ORDERED that the trial in this matter will be held on June 2, 2022.
The foregoing constitutes the Decision and Order of the Court.