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PLAINTIFF’S COMPLAINT SEEKING SPECIFIC PERFORMANCE OF A REAL ESTATE PURCHASE CONTRACT PROPERLY DISMISSED BASED UPON THE LANGUAGE OF THE CONTRACT, PLAINTIFF DID NOT APPEAR AT EITHER SCHEDULED CLOSING AFTER SUBMITTING THE HIGHEST BID AND SIGNING THE CONTRACT (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the county’s motion to dismiss plaintiff’s complaint seeking specific performance, based on the language of the real estate purchase contract, should have been granted. Plaintiff was the highest bidder on real property and signed a purchase contract but did not appear on the closing dates:

… [W]e find that the terms and conditions of the contract of sale utterly refute the plaintiff’s allegations and establish a defense as a matter of law. The contract clearly provides that the plaintiff’s failure to close pursuant to the terms and conditions of sale will result in a forfeiture of the down payment; that in the event the closing is postponed at the plaintiff’s request, then the adjourned date shall be deemed the final law date; that the plaintiff’s failure to close on the final law date shall entitle the County to cancel the sale and to retain the down payment; and, in those circumstances, the plaintiff waives all claims of any right, title and interest in the subject property and the down payment. Additionally, the terms and conditions of the contract of sale demonstrate that a material fact claimed by the plaintiff—the alleged breach of contract by the County—is not a fact at all, and no significant dispute exists regarding it. Mahmood v County of Suffolk, 2018 NY Slip Op 07715, Second Dept 11-14-18

CONTRACT LAW (REAL ESTATE PURCHASE CONTRACT, PLAINTIFF’S COMPLAINT SEEKING SPECIFIC PERFORMANCE OF A REAL ESTATE PURCHASE CONTRACT PROPERLY DISMISSED BASED UPON THE LANGUAGE OF THE CONTRACT, PLAINTIFF DID NOT APPEAR AT EITHER SCHEDULED CLOSING AFTER SUBMITTING THE HIGHEST BID AND SIGNING THE CONTRACT (SECOND DEPT))/REAL ESTATE  (REAL ESTATE PURCHASE CONTRACT, PLAINTIFF’S COMPLAINT SEEKING SPECIFIC PERFORMANCE OF A REAL ESTATE PURCHASE CONTRACT PROPERLY DISMISSED BASED UPON THE LANGUAGE OF THE CONTRACT, PLAINTIFF DID NOT APPEAR AT EITHER SCHEDULED CLOSING AFTER SUBMITTING THE HIGHEST BID AND SIGNING THE CONTRACT (SECOND DEPT))/CIVIL PROCEDURE (REAL ESTATE PURCHASE CONTRACT, PLAINTIFF’S COMPLAINT SEEKING SPECIFIC PERFORMANCE OF A REAL ESTATE PURCHASE CONTRACT PROPERLY DISMISSED BASED UPON THE LANGUAGE OF THE CONTRACT, PLAINTIFF DID NOT APPEAR AT EITHER SCHEDULED CLOSING AFTER SUBMITTING THE HIGHEST BID AND SIGNING THE CONTRACT (SECOND DEPT))/MUNICIPAL LAW  (REAL ESTATE PURCHASE CONTRACT, PLAINTIFF’S COMPLAINT SEEKING SPECIFIC PERFORMANCE OF A REAL ESTATE PURCHASE CONTRACT PROPERLY DISMISSED BASED UPON THE LANGUAGE OF THE CONTRACT, PLAINTIFF DID NOT APPEAR AT EITHER SCHEDULED CLOSING AFTER SUBMITTING THE HIGHEST BID AND SIGNING THE CONTRACT (SECOND DEPT))

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ARBITRATION AWARD SHOULD NOT HAVE BEEN VACATED, LIMITED COURT-REVIEW POWERS EXPLAINED (FIRST DEPT).

The First Department, reversing Supreme Court, determined the arbitrator’s award should have been confirmed. The dispute concerned a broker’s fee provision in a lease. The arbitrator reasoned that the lease provision did not control because at the time the tenants bought the property the lease had expired and tenancy was month to month. The First Department explained the extremely limited court-review powers re: arbitration awards:

CPLR 7511 provides just four grounds for vacating an arbitration award, including that the arbitrator “exceeded his power” (CPLR 7511[b][1][iii]), which “occurs only where the arbitrator’s award violates a strong public policy, is irrational or clearly exceeds a specifically enumerated limitation on the arbitrator’s power”… . Mere errors of fact or law are insufficient to vacate an arbitral award … . “[C]ourts are obligated to give deference to the decision of the arbitrator, … even if the arbitrator misapplied the substantive law in the area of the contract” … .

Here, the arbitrator’s conclusion that a sales commission was not due under the precise terms of the Agreement because the lease was not extended is neither wholly irrational nor contrary to any strong public policy … . Matter of NRT N.Y. LLC v Spell, 2018 NY Slip Op 07664, First Dept 11-13-18

ARBITRATION (ARBITRATION AWARD SHOULD NOT HAVE BEEN VACATED, LIMITED COURT-REVIEW POWERS EXPLAINED (FIRST DEPT))/CIVIL PROCEDURE (ARBITRATION AWARD SHOULD NOT HAVE BEEN VACATED, LIMITED COURT-REVIEW POWERS EXPLAINED (FIRST DEPT))/CONTRACT LAW (ARBITRATION AWARD SHOULD NOT HAVE BEEN VACATED, LIMITED COURT-REVIEW POWERS EXPLAINED (FIRST DEPT))

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PROPRIETARY LEASE PROVISION ALLOWING THE LANDLORD TO RECOVER ATTORNEY’S FEES EVEN WHEN THE LANDLORD IS IN DEFAULT IS UNCONSCIONABLE AND UNENFORCEABLE (FIRST DEPT).

The First Department determined that a provision in a lease which required the petitioner tenant to pay the respondent landlord’s attorney’s fees even where the landlord was in default was unenforceable as unconscionable. Petitioner tenant had sued the landlord for failure to transfer shares in an apartment in accordance with petitioner’s husband’s wishes:

In 2012, petitioner’s husband, who owned the shares to another apartment in the building, agreed to transfer his shares to petitioner. Petitioner paid a transfer fee to respondent so that it would transfer the shares to her. She later sued respondent for default of the lease agreement and for statutory violations because respondent had not transferred the shares to her husband’s apartment to her. Respondent answered petitioner’s complaint and asserted a counterclaim for attorneys’ fees under paragraph 6(7)(c). * * *

… [W]we find that an attorneys’ fees provision which provides that the tenant must pay attorneys’ fees if it commences an action against the landlord based upon the default of the landlord is unconscionable and unenforceable as a penalty. Paragraph 6(7)(c) of the proprietary lease permits the landlord to recover attorneys’ fees when the tenant brings an action against the landlord even when the landlord is in default. To enforce such a provision would produce an unjust result because it would dissuade aggrieved parties from pursuing litigation and preclude tenant-shareholders from making meaningful decisions about how to vindicate their rights in legitimate instances of landlord default. Matter of Krodel v Amalgamated Dwellings Inc., 2018 NY Slip Op 07531, First Dept 11-8-18

LANDLORD-TENANT (CONTRACT LAW, PROPRIETARY LEASE PROVISION ALLOWING THE LANDLORD TO RECOVER ATTORNEY’S FEES EVEN WHEN THE LANDLORD IS IN DEFAULT IS UNCONSCIONABLE AND UNENFORCEABLE (FIRST DEPT))/CONTRACT LAW (LANDLORD-TENANT, LEASE, CONTRACT LAW, PROPRIETARY LEASE PROVISION ALLOWING THE LANDLORD TO RECOVER ATTORNEY’S FEES EVEN WHEN THE LANDLORD IS IN DEFAULT IS UNCONSCIONABLE AND UNENFORCEABLE (FIRST DEPT))/LEASE (CONTRACT LAW, UNCONSIONABILITY, PROPRIETARY LEASE PROVISION ALLOWING THE LANDLORD TO RECOVER ATTORNEY’S FEES EVEN WHEN THE LANDLORD IS IN DEFAULT IS UNCONSCIONABLE AND UNENFORCEABLE (FIRST DEPT))/UNCONSIONABILITY (LANDLORD-TENANT, CONTRACT LAW, LEASE, PROPRIETARY LEASE PROVISION ALLOWING THE LANDLORD TO RECOVER ATTORNEY’S FEES EVEN WHEN THE LANDLORD IS IN DEFAULT IS UNCONSCIONABLE AND UNENFORCEABLE (FIRST DEPT))

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COMPLAINT DID NOT SUFFICIENTLY DESCRIBE THE GOODS FOR WHICH PLAINTIFF WAS SEEKING PAYMENT IN THIS BREACH OF CONTRACT ACTION AS REQUIRED BY CPLR 3016, THEREFORE DEFENDANT DID NOT HAVE TO SPECIFICALLY DISPUTE EACH ITEM, A GENERAL DENIAL WAS SUFFICIENT, PLAINTIFF’S SUMMARY JUDGMENT MOTION SHOULD NOT HAVE BEEN GRANTED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined that plaintiff’s motion for summary judgment in this breach of contract action should not have been granted. The criteria for a motion pursuant to CPLR 3016 (f) alleging the failure to pay for delivered goods were not met because the complaint did not sufficiently describe the goods and the prices. Therefore a general denial, as opposed to specific denials re: the items listed in the complaint, was sufficient. In addition defendant alleged the goods were not timely delivered, which is a valid defense that does not require specifically disputing each item described in the complaint:

In an action involving, inter alia, goods sold and delivered, CPLR 3016(f) permits a plaintiff to “set forth and number in his [or her] verified complaint the items of his [or her] claim and the reasonable value or agreed price of each.” “To meet the requirements of CPLR 3016(f), a complaint must contain a listing of the goods or services provided, with enough detail that it may readily be examined and its correctness tested entry by entry'” … . If the complaint meets these requirements, the defendant may not generally deny allegations of the complaint, but must, instead, specifically dispute the items on the plaintiff’s list … .

Here, the complaint failed to comply with CPLR 3016(f). The three invoices failed to state the price of each individual invoice item, or the date when each item was delivered. Although it was acknowledged that partial payment was made, the plaintiff did not specify what the partial payment was for. The plaintiff also alleged that the defendant made a partial payment toward one invoice without specifying to which of the invoiced items the defendant’s payment was applied … .

In any event, even assuming  CPLR 3016(f) was complied with, a general denial is sufficient where a defense to the cause of action pursuant to CPLR 3016(f) speaks to the “entirety of the parties’ dealings” … . In this case, the defense—that the plaintiff breached the contract by untimely delivering the items in the contract—goes to the entirety of the parties’ dealings. Further, damages awarded on the counterclaim may offset liability for goods sold and delivered if the circumstances warrant it … . SSG Door & Hardware, Inc. v APS Contr., Inc., 2018 NY Slip Op 07481, Second Dept 11-7-18

CIVIL PROCEDURE (COMPLAINT DID NOT SUFFICIENTLY DESCRIBE THE GOODS FOR WHICH PLAINTIFF WAS SEEKING PAYMENT IN THIS BREACH OF CONTRACT ACTION AS REQUIRED BY CPLR 3016, THEREFORE DEFENDANT DID NOT HAVE TO SPECIFICALLY DISPUTE EACH ITEM, A GENERAL DENIAL WAS SUFFICIENT, PLAINTIFF’S SUMMARY JUDGMENT MOTION SHOULD NOT HAVE BEEN GRANTED (SECOND DEPT))/CONTRACT LAW (COMPLAINT DID NOT SUFFICIENTLY DESCRIBE THE GOODS FOR WHICH PLAINTIFF WAS SEEKING PAYMENT IN THIS BREACH OF CONTRACT ACTION AS REQUIRED BY CPLR 3016, THEREFORE DEFENDANT DID NOT HAVE TO SPECIFICALLY DISPUTE EACH ITEM, A GENERAL DENIAL WAS SUFFICIENT, PLAINTIFF’S SUMMARY JUDGMENT MOTION SHOULD NOT HAVE BEEN GRANTED (SECOND DEPT))/DEBTOR-CREDITOR (BREACH OF CONTRACT, CIVIL PROCEDURE, COMPLAINT DID NOT SUFFICIENTLY DESCRIBE THE GOODS FOR WHICH PLAINTIFF WAS SEEKING PAYMENT IN THIS BREACH OF CONTRACT ACTION AS REQUIRED BY CPLR 3016, THEREFORE DEFENDANT DID NOT HAVE TO SPECIFICALLY DISPUTE EACH ITEM, A GENERAL DENIAL WAS SUFFICIENT, PLAINTIFF’S SUMMARY JUDGMENT MOTION SHOULD NOT HAVE BEEN GRANTED (SECOND DEPT))/CPLR 3016 (COMPLAINT DID NOT SUFFICIENTLY DESCRIBE THE GOODS FOR WHICH PLAINTIFF WAS SEEKING PAYMENT IN THIS BREACH OF CONTRACT ACTION AS REQUIRED BY CPLR 3016, THEREFORE DEFENDANT DID NOT HAVE TO SPECIFICALLY DISPUTE EACH ITEM, A GENERAL DENIAL WAS SUFFICIENT, PLAINTIFF’S SUMMARY JUDGMENT MOTION SHOULD NOT HAVE BEEN GRANTED (SECOND DEPT))

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PLAINTIFF RETAILER ATTEMPTED TO RECOVER PAYMENTS MADE TO A BANK STEMMING FROM THE HACKING OF MASTERCARD CREDIT CARD INFORMATION FROM THE RETAILER’S ACCOUNTS UNDER EQUITABLE SUBROGATION, MONEY HAD AND RECEIVED AND UNJUST ENRICHMENT THEORIES, COMPLAINT PROPERLY DISMISSED (SECOND DEPT). ​

The Second Department determined MasterCard’s motion to dismiss this equitable subrogation and unjust enrichment action by plaintiff (Jetro) stemming from the the alleged hacking or attempted hacking of MasterCard credit card information from Jetro computer systems was properly granted. MasterCard has a contract with PNC, a bank, which provided that MasterCard could recover assessments against PNC because of the hacking. Jetro was required to indemnify PNC for those assessments and sued MasterCard to recover the payments. There was no contract between MasterCard and Jetro, so the only possible viable causes of action were equitable subrogation, money had and received and unjust enrichment, which were rejected because of the terms of the relevant contracts:

Pursuant to the doctrine of equitable subrogation, where the ” property of one person is used in discharging an obligation owed by another or a lien upon the property of another, under such circumstances that the other would be unjustly enriched by the retention of the benefit thus conferred, the former is entitled to be subrogated to the position of the obligee or lien-holder'” …

Here, Jetro’s indemnification obligation, set forth in its contract with PNC, was based on Jetro’s own “acts or omissions” relating to a data breach incident. The indemnification clause in the PNC-Jetro contract is broader than the obligation of PNC toward MasterCard with respect to data breaches. According to the complaint, the PNC-Jetro contract obligated Jetro to indemnify PNC for any penalties imposed by MasterCard, “even in cases when MasterCard violated the Standards or otherwise violated the law by imposing the assessment[s] in question.” In light of these contractual provisions, even accepting the allegations of the complaint as true … , in undertaking to indemnify PNC, Jetro satisfied its separate and distinct obligation to PNC, and it is not equitably subrogated to the rights of PNC as against MasterCard … . …

“The essential elements of a cause of action for money had and received are (1) the defendant received money belonging to the plaintiff, (2) the defendant benefitted from receipt of the money, and (3) under principles of equity and good conscience, the defendant should not be permitted to keep the money” … . ” The elements of a cause of action to recover for unjust enrichment are (1) the defendant was enriched, (2) at the plaintiff’s expense, and (3) that it is against equity and good conscience to permit the defendant to retain what is sought to be recovered'” … .

Here, the subject penalties were collected or retained by MasterCard pursuant to its contract with PNC, which then sought indemnification from Jetro pursuant to PNC’s separate contract with Jetro. We agree with the Supreme Court that the exercise by MasterCard of its purported contractual rights against PNC was independent of the determination by PNC to enforce its indemnification rights against Jetro. Therefore, it cannot be said that MasterCard unjustly benefitted from its action, or that it would be inequitable to allow it to retain the subject funds … . Jetro Holdings, LLC v MasterCard Intl., Inc., 2018 NY Slip Op 07418, Second Dept 11-7-18

CONTRACT LAW (PLAINTIFF RETAILER ATTEMPTED TO RECOVER PAYMENTS MADE TO A BANK STEMMING FROM THE HACKING OF MASTERCARD CREDIT CARD INFORMATION FROM THE RETAILER’S ACCOUNTS UNDER EQUITABLE SUBROGATION, MONEY HAD AND RECEIVED AND UNJUST ENRICHMENT THEORIES, COMPLAINT PROPERLY DISMISSED (SECOND DEPT))/EQUITABLE SUBROGATION (PLAINTIFF RETAILER ATTEMPTED TO RECOVER PAYMENTS MADE TO A BANK STEMMING FROM THE HACKING OF MASTERCARD CREDIT CARD INFORMATION FROM THE RETAILER’S ACCOUNTS UNDER EQUITABLE SUBROGATION, MONEY HAD AND RECEIVED AND UNJUST ENRICHMENT THEORIES, COMPLAINT PROPERLY DISMISSED (SECOND DEPT))/MONEY HAD AND RECEIVED  (PLAINTIFF RETAILER ATTEMPTED TO RECOVER PAYMENTS MADE TO A BANK STEMMING FROM THE HACKING OF MASTERCARD CREDIT CARD INFORMATION FROM THE RETAILER’S ACCOUNTS UNDER EQUITABLE SUBROGATION, MONEY HAD AND RECEIVED AND UNJUST ENRICHMENT THEORIES, COMPLAINT PROPERLY DISMISSED (SECOND DEPT))/UNJUST ENRICHMENT (PLAINTIFF RETAILER ATTEMPTED TO RECOVER PAYMENTS MADE TO A BANK STEMMING FROM THE HACKING OF MASTERCARD CREDIT CARD INFORMATION FROM THE RETAILER’S ACCOUNTS UNDER EQUITABLE SUBROGATION, MONEY HAD AND RECEIVED AND UNJUST ENRICHMENT THEORIES, COMPLAINT PROPERLY DISMISSED (SECOND DEPT))/CREDIT CARDS (PLAINTIFF RETAILER ATTEMPTED TO RECOVER PAYMENTS MADE TO A BANK STEMMING FROM THE HACKING OF MASTERCARD CREDIT CARD INFORMATION FROM THE RETAILER’S ACCOUNTS UNDER EQUITABLE SUBROGATION, MONEY HAD AND RECEIVED AND UNJUST ENRICHMENT THEORIES, COMPLAINT PROPERLY DISMISSED (SECOND DEPT))/HACKING (CREDIT CARDS, PLAINTIFF RETAILER ATTEMPTED TO RECOVER PAYMENTS MADE TO A BANK STEMMING FROM THE HACKING OF MASTERCARD CREDIT CARD INFORMATION FROM THE RETAILER’S ACCOUNTS UNDER EQUITABLE SUBROGATION, MONEY HAD AND RECEIVED AND UNJUST ENRICHMENT THEORIES, COMPLAINT PROPERLY DISMISSED (SECOND DEPT))

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CONSTRUCTIVE NOTICE OF LIQUID ON THE FLOOR IN THIS SLIP AND FALL CASE NOT DEMONSTRATED WITH RESPECT TO THE BUILDING OWNER, NO ESPINAL FACTORS ALLEGED WITH RESPECT TO THE CLEANING SERVICE, DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the defendants’ motions for summary judgment in this slip and fall case should have been granted. Constructive notice of the liquid on the floor was not demonstrated with respect to the building owner (Berkshire) and none of the Espinal factors were alleged with respect to the cleaning service (Temco):

Here, the evidence submitted by Berkshire in support of its motion, including the transcript of the plaintiff’s deposition testimony, was sufficient to establish, prima facie, that Berkshire did not create the alleged hazardous condition or have actual or constructive notice of its existence for a sufficient period of time to have discovered and remedied it … . The plaintiff testified that when he traversed the accident site approximately 20 minutes before the incident, he did not see the condition that had caused him to slip. In opposition, the plaintiffs failed to raise a triable issue of fact.

With respect to Temco’s motion, “[g]enerally, a contractual obligation, standing alone, will not give rise to tort liability in favor of a third party” … . However, there are three exceptions to this general rule: (1) where the contracting party, in failing to exercise reasonable care in the performance of its duties, launches a force or instrument of harm or creates or exacerbates a hazardous condition; (2) where the plaintiff detrimentally relies on the continued performance of the contracting party’s duties; and (3) where the contracting party has entirely displaced the other party’s duty to maintain the premises safely… .

Here, Temco established its prima facie entitlement to judgment as a matter of law by demonstrating, prima facie, that the plaintiff was not a party to its cleaning services contract, and that it, thus, owed him no duty of care … . Since the plaintiffs did not allege facts in the complaint or bill of particulars that would establish the applicability of any of the Espinal exceptions, Temco was not required to affirmatively demonstrate that these exceptions were inapplicable in order to establish its prima facie entitlement to judgment as a matter of law … . Hagan v City of New York, 2018 NY Slip Op 07415, Second Dept 11-7-18

NEGLIGENCE (SLIP AND FALL, CONSTRUCTIVE NOTICE OF LIQUID ON THE FLOOR IN THIS SLIP AND FALL CASE NOT DEMONSTRATED WITH RESPECT TO THE BUILDING OWNER, NO ESPINAL FACTORS ALLEGED WITH RESPECT TO THE CLEANING SERVICE, DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (SECOND DEPT))/SLIP AND FALL ( CONSTRUCTIVE NOTICE OF LIQUID ON THE FLOOR IN THIS SLIP AND FALL CASE NOT DEMONSTRATED WITH RESPECT TO THE BUILDING OWNER, NO ESPINAL FACTORS ALLEGED WITH RESPECT TO THE CLEANING SERVICE, DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (SECOND DEPT))/ESPINAL FACTORS (SLIP AND FALL, SLIP AND FALL, CONSTRUCTIVE NOTICE OF LIQUID ON THE FLOOR IN THIS SLIP AND FALL CASE NOT DEMONSTRATED WITH RESPECT TO THE BUILDING OWNER, NO ESPINAL FACTORS ALLEGED WITH RESPECT TO THE CLEANING SERVICE, DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (SECOND DEPT))/CONTRACT LAW (SLIP AND FALL, ESPINAL FACTORS, CONSTRUCTIVE NOTICE OF LIQUID ON THE FLOOR IN THIS SLIP AND FALL CASE NOT DEMONSTRATED WITH RESPECT TO THE BUILDING OWNER, NO ESPINAL FACTORS ALLEGED WITH RESPECT TO THE CLEANING SERVICE, DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT SHOULD HAVE BEEN GRANTED (SECOND DEPT))

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PLAINTIFF CONTRACTOR DID NOT ALLEGE IT WAS LICENSED TO DO HOME IMPROVEMENT WORK IN ITS COMPLAINT ALLEGING BREACH OF CONTRACT AND SEEKING TO FORECLOSE ON A MECHANIC’S LIEN, THE COMPLAINT SHOULD HAVE BEEN DISMISSED (SECOND DEPT). ​

The Second Department, reversing Supreme Court, determined the defendant general contractor’s motion to dismiss the complaint brought by plaintiff subcontractor, based upon the subcontractor’s failure to allege it was licensed to do home improvement work, should have been granted:

“Pursuant to CPLR 3015(e), a complaint that seeks to recover damages for breach of a home improvement contract or to recover in quantum meruit for home improvement services is subject to dismissal under CPLR 3211(a)(7) if it does not allege compliance with the licensing requirement” … . Moreover, a home improvement contractor who fails to possess and plead possession of a valid license as required by relevant laws may not commence an action to foreclose a mechanic’s lien … .

Here, the complaint did not allege that the plaintiff was duly licensed in the Town of East Hampton at the time the services were rendered … . Moreover, in opposition to the defendants’ motion, the plaintiff did not dispute that it did not possess the necessary license. The plaintiff’s contention that the work it performed was not for home improvement but, rather, was for the construction of a new home for which a home improvement contracting license was not necessary, is without merit. The Town Code defines “home improvement” as including, inter alia, “[n]ew home construction” … . Moreover, contrary to the plaintiff’s contention, the defendants are entitled to the protection of CPLR 3015(e) and the applicable licensing requirements … . Kristeel, Inc. v Seaview Dev. Corp., 2018 NY Slip Op 07296, Second Dept 10-31-18

CIVIL PROCEDURE (HOME IMPROVEMENT CONTRACTS, PLAINTIFF CONTRACTOR DID NOT ALLEGE IT WAS LICENSED TO DO HOME IMPROVEMENT WORK IN ITS COMPLAINT ALLEGING BREACH OF CONTRACT AND SEEKING TO FORECLOSE ON A MECHANIC’S LIEN, THE COMPLAINT SHOULD HAVE BEEN DISMISSED (SECOND DEPT))/CPLR 3015 (HOME IMPROVEMENT CONTRACTS, PLAINTIFF CONTRACTOR DID NOT ALLEGE IT WAS LICENSED TO DO HOME IMPROVEMENT WORK IN ITS COMPLAINT ALLEGING BREACH OF CONTRACT AND SEEKING TO FORECLOSE ON A MECHANIC’S LIEN, THE COMPLAINT SHOULD HAVE BEEN DISMISSED (SECOND DEPT))/HOME IMPROVEMENT CONTRACTS (PLAINTIFF CONTRACTOR DID NOT ALLEGE IT WAS LICENSED TO DO HOME IMPROVEMENT WORK IN ITS COMPLAINT ALLEGING BREACH OF CONTRACT AND SEEKING TO FORECLOSE ON A MECHANIC’S LIEN, THE COMPLAINT SHOULD HAVE BEEN DISMISSED (SECOND DEPT))/CONTRACT LAW (HOME IMPROVEMENT CONTRACTS, PLAINTIFF CONTRACTOR DID NOT ALLEGE IT WAS LICENSED TO DO HOME IMPROVEMENT WORK IN ITS COMPLAINT ALLEGING BREACH OF CONTRACT AND SEEKING TO FORECLOSE ON A MECHANIC’S LIEN, THE COMPLAINT SHOULD HAVE BEEN DISMISSED (SECOND DEPT))/LIEN LAW (HOME IMPROVEMENT CONTRACTS, PLAINTIFF CONTRACTOR DID NOT ALLEGE IT WAS LICENSED TO DO HOME IMPROVEMENT WORK IN ITS COMPLAINT ALLEGING BREACH OF CONTRACT AND SEEKING TO FORECLOSE ON A MECHANIC’S LIEN, THE COMPLAINT SHOULD HAVE BEEN DISMISSED (SECOND DEPT))/MECHANIC’S LIENS (HOME IMPROVEMENT CONTRACTS, PLAINTIFF CONTRACTOR DID NOT ALLEGE IT WAS LICENSED TO DO HOME IMPROVEMENT WORK IN ITS COMPLAINT ALLEGING BREACH OF CONTRACT AND SEEKING TO FORECLOSE ON A MECHANIC’S LIEN, THE COMPLAINT SHOULD HAVE BEEN DISMISSED (SECOND DEPT))/MUNICIPAL LAW (LICENSES, HOME IMPROVEMENT CONTRACTS, PLAINTIFF CONTRACTOR DID NOT ALLEGE IT WAS LICENSED TO DO HOME IMPROVEMENT WORK IN ITS COMPLAINT ALLEGING BREACH OF CONTRACT AND SEEKING TO FORECLOSE ON A MECHANIC’S LIEN, THE COMPLAINT SHOULD HAVE BEEN DISMISSED (SECOND DEPT))/LICENSES  (HOME IMPROVEMENT CONTRACTS, PLAINTIFF CONTRACTOR DID NOT ALLEGE IT WAS LICENSED TO DO HOME IMPROVEMENT WORK IN ITS COMPLAINT ALLEGING BREACH OF CONTRACT AND SEEKING TO FORECLOSE ON A MECHANIC’S LIEN, THE COMPLAINT SHOULD HAVE BEEN DISMISSED (SECOND DEPT))

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STIPULATION OF DISCONTINUANCE ENTERED INTO BY PLAINTIFF’S ATTORNEY COULD NOT BE INVALIDATED, EVEN THOUGH PLAINTIFF CHANGED HER MIND BEFORE THE STIPULATION WAS FILED, NO EVIDENCE OF DURESS, FRAUD, MISTAKE, OVERREACHING (SECOND DEPT).

he Second Department determined a stipulation of settlement entered by plaintiff’s attorney was a binding contract. The fact that plaintiff changed her mind before the stipulation was filed was of no consequence. Plaintiff made no effort to demonstrate the contract was invalid due to duress, fraud, mistake or overreaching:

We agree with the Supreme Court’s determination to deny the plaintiff’s motion, inter alia, to vacate the stipulation of discontinuance. CPLR 2104 provides that, “[a]n agreement between parties or their attorneys relating to any matter in an action, other than one between counsel in open court, is not binding upon a party unless it is in a writing subscribed by him or his attorney or reduced to the form of an order and entered.” Here, there is no dispute that on October 30, 2015, the plaintiff’s former counsel had actual authority from his client to enter into the stipulation discontinuing the action on her behalf … . Contrary to the plaintiff’s contention, the stipulation of discontinuance clearly evidenced the plaintiff’s intent to discontinue the action as of October 30, 2015, notwithstanding that she changed her mind prior to the filing of the stipulation on November 2, 2015 … , even though it did not effect a discontinuance until it was filed with the clerk of the court on November 2, 2015 (CPLR 3217[a][2]). In seeking to vacate the stipulation, the plaintiff failed to meet her burden to establish good cause sufficient to invalidate a contract, such as that the stipulation was the result of duress, fraud, mistake, or overreaching, or that the terms of the stipulation were unconscionable … . Demetriou v Wolfer, 2018 NY Slip Op 07288, Second Dept 10-31-18

CIVIL PROCEDURE (STIPULATION OF DISCONTINUANCE ENTERED INTO BY PLAINTIFF’S ATTORNEY COULD NOT BE INVALIDATED, EVEN THOUGH PLAINTIFF CHANGED HER MIND BEFORE THE STIPULATION WAS FILED, NO EVIDENCE OF DURESS, FRAUD, MISTAKE, OVERREACHING (SECOND DEPT))/DISCONTINUANCE (STIPULATION OF DISCONTINUANCE ENTERED INTO BY PLAINTIFF’S ATTORNEY COULD NOT BE INVALIDATED, EVEN THOUGH PLAINTIFF CHANGED HER MIND BEFORE THE STIPULATION WAS FILED, NO EVIDENCE OF DURESS, FRAUD, MISTAKE, OVERREACHING (SECOND DEPT))/STIPULATIONS (STIPULATION OF DISCONTINUANCE ENTERED INTO BY PLAINTIFF’S ATTORNEY COULD NOT BE INVALIDATED, EVEN THOUGH PLAINTIFF CHANGED HER MIND BEFORE THE STIPULATION WAS FILED, NO EVIDENCE OF DURESS, FRAUD, MISTAKE, OVERREACHING (SECOND DEPT))/CONTRACT LAW (STIPULATION OF DISCONTINUANCE ENTERED INTO BY PLAINTIFF’S ATTORNEY COULD NOT BE INVALIDATED, EVEN THOUGH PLAINTIFF CHANGED HER MIND BEFORE THE STIPULATION WAS FILED, NO EVIDENCE OF DURESS, FRAUD, MISTAKE, OVERREACHING (SECOND DEPT))/CPLR 2103, CPLR 3217 (STIPULATION OF DISCONTINUANCE ENTERED INTO BY PLAINTIFF’S ATTORNEY COULD NOT BE INVALIDATED, EVEN THOUGH PLAINTIFF CHANGED HER MIND BEFORE THE STIPULATION WAS FILED, NO EVIDENCE OF DURESS, FRAUD, MISTAKE, OVERREACHING (SECOND DEPT))/ATTORNEYS STIPULATION OF DISCONTINUANCE ENTERED INTO BY PLAINTIFF’S ATTORNEY COULD NOT BE INVALIDATED, EVEN THOUGH PLAINTIFF CHANGED HER MIND BEFORE THE STIPULATION WAS FILED, NO EVIDENCE OF DURESS, FRAUD, MISTAKE, OVERREACHING (SECOND DEPT)

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DAMAGES FOR BREACH OF HOME IMPROVEMENT CONTRACT NOT PROVEN, RESTITUTION IS NOT A REMEDY UNDER THE GENERAL BUSINESS LAW, GROUNDS FOR PUNITIVE DAMAGES NOT PROVEN, STATUTORY FEES, INCLUDING ATTORNEY’S FEES, APPLICABLE (SECOND DEPT).

The Second Department determined plaintiff did not submit sufficient proof of damages stemming from the alleged breach of a home improvement contract, and the restitution and punitive damages awards were improper. The statutory General Business Law awards, including attorney’s fees, were applicable:

… [T]he plaintiff failed to meet her burden of proving damages for breach of contract. The appropriate measure of damages for breach of a home improvement contract by the contractor for defective construction is the cost to repair the defects … , as of the date the cause of action accrued … . Here, the plaintiff did not proffer competent evidence to establish her costs to repair the defendants’ defective work as of the date the cause of action accrued … . Accordingly, the damages award in the sum of $9,358.96 for breach of contract must be set aside.

We also agree with the defendants that the jury improperly awarded the sum of $17,730 as restitution damages pursuant to General Business Law § 772, representing the total sum paid by the plaintiff under the home improvement contract before the defendants abandoned the project, since restitution damages are not provided for under that statute … .

Further, we agree with the defendants that the plaintiff is not entitled to recover punitive damages. Although the jury found that the defendants were liable for breach of contract, the plaintiff failed to establish that the defendants’ conduct was egregious, directed toward the plaintiff, and part of a pattern directed at the public … . Moreover, to the extent that the plaintiff’s case rested on allegations of fraud, she failed to establish that the defendants’ conduct was so gross, wanton, or willful, or of such high moral culpability, as to justify an award of punitive damages … . Crippen v Adamao2018 NY Slip Op 07287, Second Dept 10-31-18

CONTRACT LAW (DAMAGES FOR BREACH OF HOME IMPROVEMENT CONTRACT NOT PROVEN, RESTITUTION IS NOT A REMEDY UNDER THE GENERAL BUSINESS LAW, GROUNDS FOR PUNITIVE DAMAGES NOT PROVEN, STATUTORY FEES, INCLUDING ATTORNEY’S FEES, APPLICABLE (SECOND DEPT))/EVIDENCE (BREACH OF CONTRACT, DAMAGES FOR BREACH OF HOME IMPROVEMENT CONTRACT NOT PROVEN, RESTITUTION IS NOT A REMEDY UNDER THE GENERAL BUSINESS LAW, GROUNDS FOR PUNITIVE DAMAGES NOT PROVEN, STATUTORY FEES, INCLUDING ATTORNEY’S FEES, APPLICABLE (SECOND DEPT))/DAMAGES (BREACH OF CONTRACT, DAMAGES FOR BREACH OF HOME IMPROVEMENT CONTRACT NOT PROVEN, RESTITUTION IS NOT A REMEDY UNDER THE GENERAL BUSINESS LAW, GROUNDS FOR PUNITIVE DAMAGES NOT PROVEN, STATUTORY FEES, INCLUDING ATTORNEY’S FEES, APPLICABLE (SECOND DEPT))/FRAUD (HOME IMPROVEMENT CONTRACT, DAMAGES FOR BREACH OF HOME IMPROVEMENT CONTRACT NOT PROVEN, RESTITUTION IS NOT A REMEDY UNDER THE GENERAL BUSINESS LAW, GROUNDS FOR PUNITIVE DAMAGES NOT PROVEN, STATUTORY FEES, INCLUDING ATTORNEY’S FEES, APPLICABLE (SECOND DEPT))/HOME IMPROVEMENT CONTRACT DAMAGES FOR BREACH OF HOME IMPROVEMENT CONTRACT NOT PROVEN, RESTITUTION IS NOT A REMEDY UNDER THE GENERAL BUSINESS LAW, GROUNDS FOR PUNITIVE DAMAGES NOT PROVEN, STATUTORY FEES, INCLUDING ATTORNEY’S FEES, APPLICABLE (SECOND DEPT))/GENERAL BUSINESS LAW (HOME IMPROVEMENT CONTRACTS, DAMAGES FOR BREACH OF HOME IMPROVEMENT CONTRACT NOT PROVEN, RESTITUTION IS NOT A REMEDY UNDER THE GENERAL BUSINESS LAW, GROUNDS FOR PUNITIVE DAMAGES NOT PROVEN, STATUTORY FEES, INCLUDING ATTORNEY’S FEES, APPLICABLE (SECOND DEPT))/LICENSES (HOME IMPROVEMENT CONTRACTORS, (DAMAGES FOR BREACH OF HOME IMPROVEMENT CONTRACT NOT PROVEN, RESTITUTION IS NOT A REMEDY UNDER THE GENERAL BUSINESS LAW, GROUNDS FOR PUNITIVE DAMAGES NOT PROVEN, STATUTORY FEES, INCLUDING ATTORNEY’S FEES, APPLICABLE (SECOND DEPT))/PUNITIVE DAMAGES (BREACH OF CONTRACT, FRAUD, DAMAGES FOR BREACH OF HOME IMPROVEMENT CONTRACT NOT PROVEN, RESTITUTION IS NOT A REMEDY UNDER THE GENERAL BUSINESS LAW, GROUNDS FOR PUNITIVE DAMAGES NOT PROVEN, STATUTORY FEES, INCLUDING ATTORNEY’S FEES, APPLICABLE (SECOND DEPT))

, ,

ALTHOUGH PLAINTIFF DEFAULTED ON A MATERIAL TERM OF AN INSTALLMENT LAND SALE CONTRACT, DEFENDANT WAS NOT ENTITLED TO SPECIFIC PERFORMANCE OR CANCELLATION AND RETENTION OF THE SUBSTANTIAL PAYMENTS WHICH PLAINTIFF HAD MADE, PLAINTIFF WAS ENTITLED TO CONTINUED POSSESSION (THIRD DEPT).

The Third Department, reversing Supreme Court, determined that, although plaintiff had defaulted on an installment land sale contract (re: the payment of school taxes), defendant was not entitled to specific performance and was not entitled to cancellation of the contract and retention of the installment payments:

“[T]he execution of a[n installment] contract for the purchase of real estate and the making of a part payment gives a contract vendee equitable title to the property and an equitable lien in the amount of the payment” … . The contract vendor, in turn, “holds the legal title in trust for the vendee, subject to the vendor’s equitable lien for the payment of the purchase price in accordance with the terms of the contract” … . “Accordingly, the vendee under a land sale contract has acquired an interest in the property that must be extinguished before the vendor can resume possession, notwithstanding whether a provision in the contract provides that in the event of the vendee’s uncured default . . ., the vendor has the right to declare the contract terminated and repossess the premises. A vendor may not enforce his [or her] rights by an action in ejectment, but must instead proceed to foreclose the vendee’s equitable title or bring an action at law for the purchase price” … .

Plaintiff, having made substantial payments to defendant pursuant to the installment land sale contract at issue, acquired equitable title to the property and an equitable lien in the amount of all payments made pursuant to the contract. Thus, despite plaintiff’s default under the contract, defendant cannot obtain relief under the provision of the rider that provides for cancellation of the contract and forfeiture of all monies paid by plaintiff as liquidated damages… . Accordingly, to the extent that defendant’s motion sought a declaration to that effect, it must be denied. Defendant’s remedies are, instead, limited to foreclosing plaintiff’s equitable title or bringing an action at law for the purchase price of the property, neither of which defendant has sought … . Further, because defendant could not summarily cancel the contract and resume possession, plaintiff is entitled to continued possession of the premises during such time. Cloke v Findlan, 2018 NY Slip Op 07220. Third Dept 10-25-18

REAL ESTATE (ALTHOUGH PLAINTIFF DEFAULTED ON A MATERIAL TERM OF AN INSTALLMENT LAND SALE CONTRACT, DEFENDANT WAS NOT ENTITLED TO SPECIFIC PERFORMANCE OR CANCELLATION AND RETENTION OF THE SUBSTANTIAL PAYMENTS WHICH PLAINTIFF HAD MADE, PLAINTIFF WAS ENTITLED TO CONTINUED POSSESSION (THIRD DEPT))/CONTRACT LAW (REAL ESTATE, ALTHOUGH PLAINTIFF DEFAULTED ON A MATERIAL TERM OF AN INSTALLMENT LAND SALE CONTRACT, DEFENDANT WAS NOT ENTITLED TO SPECIFIC PERFORMANCE OR CANCELLATION AND RETENTION OF THE SUBSTANTIAL PAYMENTS WHICH PLAINTIFF HAD MADE, PLAINTIFF WAS ENTITLED TO CONTINUED POSSESSION (THIRD DEPT))/DEBTOR-CREDITOR (REAL ESTATE, INSTALLMENT CONTRACT, ALTHOUGH PLAINTIFF DEFAULTED ON A MATERIAL TERM OF AN INSTALLMENT LAND SALE CONTRACT, DEFENDANT WAS NOT ENTITLED TO SPECIFIC PERFORMANCE OR CANCELLATION AND RETENTION OF THE SUBSTANTIAL PAYMENTS WHICH PLAINTIFF HAD MADE, PLAINTIFF WAS ENTITLED TO CONTINUED POSSESSION (THIRD DEPT))/INSTALLMENT LAND SALE CONTRACT  (ALTHOUGH PLAINTIFF DEFAULTED ON A MATERIAL TERM OF AN INSTALLMENT LAND SALE CONTRACT, DEFENDANT WAS NOT ENTITLED TO SPECIFIC PERFORMANCE OR CANCELLATION AND RETENTION OF THE SUBSTANTIAL PAYMENTS WHICH PLAINTIFF HAD MADE, PLAINTIFF WAS ENTITLED TO CONTINUED POSSESSION (THIRD DEPT))

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