Opinion
600928/02.
Decided April 17, 2006.
In motion sequence 004, plaintiff HGCD Retail Services, LLC, (HGCD) moves, pursuant to CPLR 2508 and CPLR 5519 (c), to vacate the stay of the enforcement of Judgment on the grounds that the undertaking on appeal, filed by defendants 44-45 Broadway Realty Co. (44-45 Broadway) and Bowtie Management Co., LLC (Bowtie), is insufficient to invoke the stay provisions of CPLR 5519 (a) (2), or, in the alternative, plaintiff moves to direct defendants to file a proper or supplemental undertaking on appeal in order to obtain a stay of the enforcement of Judgment.
Background
As this Court's previous decision, dated June 30, 2005, discusses this case in detail, the background, as relevant to the present motion, will only briefly be recited.
By order dated June 30, 2005, this Court granted plaintiff's motion for summary judgment to recover unpaid brokerage commissions. On July 26, 2005, a judgment was entered in plaintiff's favor against the defendants in the amount of $1,857,693.55. On August 9, 2005, defendants filed their Notice of Appeal from the judgment and underlying order. On August 22, 2005, defendants filed an undertaking on appeal, and, on August 23, 2005, served plaintiff's counsel with a Notice of Filing of Undertaking on Appeal. The undertaking is in the exact amount of the judgment of $1,857,693.55. By order dated October 11, 2005, the Appellate Division, First Department directed that the appeal be perfected for the February 2006 Term, and thus, the appeal has presumably been fully briefed and argued.
Analysis
CPLR 5519 (a) (2) provides that a stay of execution of a money judgment is available, without a court order, if:
"the judgment or order directs the payment of a sum of money, and an undertaking in that sum is given, that if the judgment or order appealed from, or any part of it, is affirmed, or the appeal is dismissed, the appellant or moving party shall pay the amount directed to be paid by the judgment or order, or the part of it as to which the judgment or order is affirmed."
Plaintiff and defendants dispute whether the undertaking must include post-judgment interest under CPLR 5519 (a) (2). Plaintiff argues that defendants' undertaking is insufficient to invoke the stay provisions of CPLR 5519 (a) (2), because it only covers the principal amount of the judgment, and not post-judgment interest. Defendants assert that CPLR 5519 (a) (2) does not provide for the inclusion of post-interest, while on the other hand, CPLR 5519 (b) specifically does. Defendants argue that this evidences the legislature's intent to omit the requirement of including interest under CPLR 5519 (a) (2).
However, CPLR 5519 (b) is different, in that it governs actions being defended by insurance companies, and insurance policy limits, specifically in cases of inadequate insurance. See Timal v. Kiamzon, 164 Misc 2d 159, 162 (Sup Ct Queens County 1995).
While pending appeal, interest accrues on the plaintiff's judgment. See CPLR 5003. "It is well settled that post judgment interest is awarded as a penalty for delayed payment of a judgment." ERHAL Holding Corp. v. Rusin, 252 AD2d 473, 474 (2nd Dept 1998). Thus, it is clear that plaintiff is entitled to post-judgment interest should this Court's order and judgment be affirmed by the Appellate Division, First Department.
The undertaking must provide sufficient collateral to pay the judgment, and that would require taking into consideration the interest on such judgment. It is in this Court's discretion to order defendants to procure and file an amendment to the existing bond to provide for such interest. Plaintiff is entitled to have "victory secured so that [if] the stay of enforcement resulting from the appeal is vacated by affirmance, a ready fund with which to satisfy the judgment shall be available." Robert Stigwood Organisation, Inc. v. Devon Company, 91 Misc 2d 723, 723-724 (Sup Ct, New York County 1977). Therefore, the court finds that the undertaking should provide for all interest that shall accrue on appeal. See Dwyer v. Nicholson, 154 Misc 2d 123 (Sup Ct Kings County 1991).
Accordingly, it is
ORDERED that defendants are directed to procure and file an amendment to the existing bond to provide for all interest that has accrued as of this date, post judgment at the statutory rate, within 30 days from the service of a copy of this order with notice of entry, in order to obtain a stay of the enforcement of the Judgment, pending the appeal. The foregoing constitutes the Order of the Court.