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Question of Fact Whether General Releases Encompassed Environmental Damage from Leaking Fuel Tank

The Second Department determined that there was a question whether general releases contemplated damages related to environmental contamination and the action should not have been dismissed based on the releases. The action concerned gasoline which had leaked into the ground when defendant had leased the plaintiff’s property.  The court explained:

Generally, a valid release completely bars an action on a claim that is the subject of the release … . Principles of contract law govern the interpretation of a release; “a release that is complete, clear, and unambiguous on its face must be enforced according to the plain meaning of its terms'” … . Nonetheless, as the Court of Appeals has recognized with respect to a general release, “[t]here is little doubt . . . that its interpretation and limitation by the parol evidence rule are subject to special rules. These rules are based on a realistic recognition that releases contain standardized, even ritualistic, language and are given in circumstances where the parties are sometimes looking no further than the precise matter in dispute that is being settled. Thus, while it has been held that an unreformed general release will be given its full literal effect where it is directly or circumstantially evident that the purpose is to achieve a truly general settlement …, the cases are many in which the release has been avoided with respect to uncontemplated transactions despite the generality of the language in the release form” … .

Further, “[t]he meaning and extent of coverage of a release necessarily depend, as in the case of contracts generally, upon the controversy being settled and upon the purpose for which the release was actually given'” … . A general release may not be construed to cover matters that the parties “did not desire or intend to dispose of” … .

Here, the two releases at issue, whether construed together or separately, are ambiguous regarding whether the parties intended that they cover unknown claims for environmental contamination… .  Burnside 711 LLC v Amerada Hess Corp, 2013 NY Slip Op 05869, 2nd Dept 9-18-13

 

No Evidence Release Invalidated by Fraud or Duress

In upholding the validity of a release, the Second Department explained the relevant principles:

” A release is a contract, and its construction is governed by contract law'” … . “A release may be invalidated . . . for any of the traditional bases for setting aside written agreements'” … . However, “a signed release shifts the burden of going forward . . . to the [plaintiff] to show that there has been fraud, duress or some other fact which will be sufficient to void the release'” … .

Here, the plaintiff failed to demonstrate that there was fraud, duress, or some other fact sufficient to void the release. Davis v Rochdale Vil, Inc, 2013 NY Slip Op 05874, 2nd Dept 9-18-13

 

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Petition Seeking Revocation of Building Permit Should Have Named the Director Who Had the Power to Revoke It

In affirming the grant of a building permit by the village board of appeals (BOA), the Second Department noted that only Director of Building, Code Enforcement and Land Use Administration had the power to revoke a building permit and therefore the Director should have been named in the Article 78 proceeding seeking revocation: …[I]n a proceeding pursuant to CPLR article 78 which seeks to compel a body or officer to perform a duty imposed by law, the proceeding must be commenced against the body or officer whose performance is sought (see CPLR 7803). The petitioners sought to compel the BOA to revoke the building permit and any subsequently issued certificate of occupancy. However, only the Director is empowered to do so (see Village Code §§ 126-7, 126-12, 126-15). Thus, the petitioners should have named and joined the Director as a party to this proceeding … .  Matter of Lucas v Board of Appeals of Vil of Mamaroneck, 2013 NY Slip Op 05908, 2nd Dept 9-18-13

 

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Termination of Participation in Affordable Housing Program Is Not a Taxable Transfer

In a full-fledged opinion by Justice Cohen, the Second Department determined that when a residential housing cooperative amends its certificate of incorporation as part of a voluntary dissolution, reconstitution, and termination of participation in the Mitchell-Lama housing program (Private Housing Finance Law section 10 et seq, an affordable housing program established in 1955) there is no transfer or conveyance of real property or an interest in real property and, therefore, no taxable event occurs under Tax Law section 1201(b) (i.e., no real property transfer tax [RPTT] is due).  This opinion replaced the opinion in Trump Vil. Section 3, Inc v City of New York, 100 AD3d 170, which is recalled and vacated. Trump Vil Section 3, Inc v City of New York, 2013 NY Slip Op 05894, 2nd Dept 9-18-13

 

Ownership Acquired by Adverse Possession Demonstrated

The Second Department reversed Supreme Court and determined plaintiffs had proved ownership of a strip of land by adverse possession:

…[W]e conclude that the plaintiffs demonstrated ownership to the subject strip through adverse possession. ” A party seeking to obtain title by adverse possession must prove by clear and convincing evidence . . . that (1) the possession was hostile and under claim of right; (2) it was actual; (3) it was open and notorious; (4) it was exclusive; and (5) it was continuous for the statutory period of 10 years'” … . Additionally, since the adverse possession claim is not founded upon a written instrument, the plaintiffs must establish, in accordance with the law in effect at the time this action was commenced, that the disputed property was either “usually cultivated or improved” or “protected by a substantial inclosure” (RPAPL former 522…).

Here, the plaintiffs demonstrated that, by building and maintaining a wall along the subject strip, which was styled to match their house and attached to a gate attached to their house, they continually possessed the subject strip, for more than 10 years, in a manner that was open and notorious, exclusive, and inimical to the rights of the [defendants’] predecessor… . Marone v Kally, 2013 NY Slip Op 05882, 2nd Dept 9-18-13

 

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Planning Board Should Not Have Added Conditions for Approval of Final Plat Plan

The Second Department affirmed Supreme Court’s determination that the planning board’s denial of approval of a final plat plan was arbitrary and capricious.  The Court determined that the planning board was aware of the variance upon which the denial was based (involving the transfer of sanitary flow credits) at the time it approved the preliminary plat plan:

Although the Planning Board’s approval of the preliminary plat in April 2010 did not guarantee approval of the final version (see Town Law § 276[4]), a planning board may not, in the absence of significant new information, deny final approval if a property owner implements the modifications or conditions required by a preliminary approval (…Terry Rice, Practice Commentaries, McKinney’s Cons Laws of NY, Book 61, Town Law § 276 Preliminary Review). Here, the Planning Board had long known that the SCDHS’s approval of a Suffolk County Sanitary Code variance was based on the transfer of sanitary flow credits and, indeed, the Planning Board specifically referenced that transfer in its April 2010 conditional preliminary approval. Inasmuch as no significant new information came to light after the Planning Board gave its approval to the preliminary plat, its imposition of additional requirements in the conditional final approval was, as the Supreme Court correctly held, arbitrary and capricious… . Matter of Nickart Realty Corp v Southold Town Planning Bd, 2013 NY Slip Op 05909, 2nd Dept 9-18-13

 

Variance Properly Granted/Review Criteria Explained

The Second Department, after noting that an application for a variance can be made by an agent for the property owner, determined the Board of Zoning Appeals had properly granted the lot-width variances.  In explaining the court’s role in reviewing variances, the court wrote:

…”[L]ocal zoning boards are vested with broad discretion in considering applications for area variances, and [c]ourts may set aside a zoning board determination only where the record reveals that the board acted illegally or arbitrarily, or abused its discretion, or that it merely succumbed to generalized community pressure'” … . A variance determination of a zoning board should be sustained if it has a rational basis and is not arbitrary and capricious … .

Here, the Board properly balanced the requisite statutory factors, and its determination that the benefit to the applicant of the requested variances outweighed the detriment to the health, safety, and welfare of the neighborhood or community had a rational basis and was not arbitrary and capricious (see Town Law § 267-b[3][b]…). Among other things, the Board found that, despite a few wide lots in the vicinity of the premises, the majority of lots in the uninterrupted two-block segment of Bayview Avenue in which the subject premises were located had a width of 50 feet or less, and, thus, that the variances would not produce an undesirable change in the character of the neighborhood or a detriment to nearby properties. Matter of Huszar v Bayview Park Props LLC, 2013 NY Slip Op 05906, 2nd Dept 9-18-13

 

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New Affidavits Properly Allowed in Foreclosure Proceedings; Accuracy of the Execution or Notarizations of the Original Affidavits Could Not Be Confirmed

In affirming Supreme Court’s granting of plaintiff’s motion to substitute new affidavits of merit in a foreclosure proceeding because the accuracy of the execution and/or notarizations of the original affidavits could not be confirmed, the Second Department explained:

CPLR 2001 permits a court, at any stage of an action, to disregard a party’s mistake, omission, defect, or irregularity if a substantial right of a party is not prejudiced … . ” Pursuant to CPLR 5019(a), a trial court has the discretion to correct an order or judgment which contains a mistake, defect, or irregularity not affecting a substantial right of a party'” … . The provisions in CPLR 2001 and 5019(a) may only be employed to correct errors where the corrections do not affect a substantial right of the parties … .

Under the facts of this case, the Supreme Court providently exercised its discretion in granting the plaintiff’s motion. No substantial right of Eaddy [the defendant] will be affected by the court’s substitution of the new affidavits of merit and of the amount due … . The new proposed affidavits of merit and of the amount due list the same amounts due and owing as those stated in the original affidavits submitted with the application for the order of reference and the application for the judgment of foreclosure and sale. Further, Eaddy has remained in possession of the subject property throughout the pendency of the instant action. US Bank NA v Eaddy, 2013 NY Slip Op 05896, 2nd Dept 9-18-13

 

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Criteria for Seizure of Equipment Explained

In reversing Supreme Court, the Second Department determined the plaintiff, in a replevin action, was not required to demonstrate irreparable harm in an action for seizure pursuant to CPLR 7102.  The defendant had defaulted on an equipment lease.  The court wrote:

Pursuant to CPLR 7102(c) and (d), on a motion for an order of seizure, a plaintiff must demonstrate a likelihood of success on its cause of action for replevin and the absence of a valid defense to its claim … . Here, the plaintiff made such a showing … . Contrary to the court’s determination, the plaintiff was not required to demonstrate that it would suffer irreparable injury in order to obtain an order of seizure pursuant to CPLR 7102.  TCF Equip Fin Inc v Interdimensional Interiors, Inc, 2013 NY Slip 05893, 2nd Dept 9-18-13

 

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Opening Statement Provided Grounds for Dismissal of False Arrest/Malicious Prosecution Action

The Second Department affirmed Supreme Court’s grant of a judgment as a matter of law to the defendant in a false arrest/malicious prosecution case based upon plaintiff’s counsel’s opening statement. In the opening, counsel stated the defendant had been arrested after the eyewitness victim made an in-person identification of the plaintiff to a police officer.  Because the eyewitness identification provided probable cause for the arrest, the false arrest and malicious prosecution causes of action were not viable:

An application for judgment as a matter of law may be made at the close of an opposing party’s case, or at any time on the basis of admissions (see CPLR 4401). The grant of such an application prior to the close of the opposing party’s case is generally disfavored … . However, judgment as a matter of law may be warranted prior to the presentation of any evidence if the plaintiff has, “by some admission or statement of fact, so completely compromised his or her case that the court was justified in awarding judgment as a matter of law to one or more defendants”… . * * *

Here, the plaintiff, through his counsel, admitted that the eyewitness victim of the alleged crimes made an in-person identification of the plaintiff to a police officer, which led to his immediate arrest by that officer. This admission by the plaintiff, through his counsel, “so completely compromised” his position that the police lacked probable cause to arrest him, that the Supreme Court was justified in awarding judgment as a matter of law to the City…. Okunubi v City of New York, 2013 NY Slip Op 05886, 2nd Dept 9-18-13

 

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