Opinion
Index 154219/2020
02-22-2022
SAMPATCO INC, Plaintiff, v. 86 1/2 NASSAU LLC, JOHN ELLIS, GIACOMO VELTRI, THERESA VELTRI, Defendants.
Unpublished Opinion
Motion Date 08/02/2021, 08/02/2021
Motion Seq. No. 001 002
PRESENT: HON. ALEXANDER TISCH Justice
DECISION + ORDER ON MOTION
ALEXANDER TISCH, JUDGE
The following e-filed documents, listed by NYSCEF document number (Motion 001) 6, 7, 8, 10, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 72 were read on this motion to/for PREL INJUNCTION/TEMP REST ORDR.
The following e-filed documents, listed by NYSCEF document number (Motion 002) 66, 67, 68, 69, 70, 71, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 96 were read on this motion to/for INJUNCTION/RESTRAINING ORDER
Upon the foregoing documents, plaintiff-commercial tenant Sampatco Inc., moves by order to show cause dated July 27, 2020 (NYSCEF Doc No. 10 [Feinman, J.]) for a Yellowstone injunction (First Natl. Stores v Yellowstone Shopping Ctr., 21 N.Y.2d 630 [1968]) tolling and staying the running of the Notice(s) to Cure issued by defendant-landlord 86 1/2 Nassau LLC (defendant) and enjoining all defendants to cease obstructing plaintiffs application for a certificate of occupancy.
As an initial matter, the Court agrees with defendants that plaintiff failed to set forth its basis for the injunctive relief pursuant to CPLR 6311 or 6301. Accordingly, that branch of the motion is denied without prejudice.
"A Yellowstone injunction maintains the status quo so that a commercial tenant, when confronted by a threat of termination of its lease, may protect its investment in the leasehold by obtaining a stay tolling the cure period so that upon an adverse determination on the merits the tenant may cure the default and avoid a forfeiture" (Graubard Mollen Horowitz Pomeranz & Shapiro v 600 Third Ave. Assoc, 93 N.Y.2d 508, 514 [1999] [hereinafter Graubard]; see Lexington Ave. & 42ndSt. Corp. v 380 Lexchamp Operating, Inc., 205 A.D.2d 421, 423 [1st Dept 1994] [its purpose "is to maintain the status quo so that the tenant may challenge the landlord's assessment of its rights without the tenant... forfeiting its valuable property interest in the lease"]).
The party requesting a Yellowstone injunction must demonstrate that:
(1) it holds a commercial lease; (2) it received from the landlord either a notice of default, a notice to cure, or a threat of termination of the lease; (3) it requested injunctive relief prior to the termination of the lease; and (4) it is prepared and maintains the ability to cure the alleged default by any means short of vacating the premises (Graubard, 93 N.Y.2d at 514, quoting 225 E. 36th St. Garage Corp. v 221 E. 36th Owners Corp., 211 A.D.2d 420, 421 [1st Dept 1995]).
Because '"courts cannot reinstate a lease after the lapse of time specified to cure a default' (Goldstein v Kohl's, 16 A.D.3d 622, 623 [2d Dept 2005]), an application for Yellowstone relief must be made not only before the termination of the subject lease .. . but must also be made prior to the expiration of the cure period set forth in the lease and the landlord's notice to cure" (Korova Milk Bar of White Plains, Inc. v PRE Props., LLC, 70 A.D.3d 646, 647 [2d Dept 2010]).
On May 28, 2020, defendant served on plaintiff a fifteen-day notice of default for allegedly failing to provide proof of insurance in violation of paragraphs 58 (A) and (B), 48 (D), and 53 (F) (iv) of the lease between the plaintiff and defendant dated October 25, 2018 (see NYSCEF Doc No. 19). The time to cure set forth in the notice of default expired on June 17, 2020. On June 18, 2020, defendant served plaintiff with a five-day notice of lease cancellation, which sought to terminate the lease as of June 25, 2020 (see NYSCEF Doc No. 20).
The May 28, 2020 notice superseded the substantially similar notice of default dated May 22, 2020 (NYSCEF Doc No. 34 at 7, n 1).
Plaintiff filed this action on June 11, 2020 and the instant Yellowstone application on June 22, 2020, which was after the time to cure set in the notice of default expired. Additionally, because "[a] motion on notice is made when a notice of the motion or an order to show cause is served" (CPLR 2211) and, here, the order to show cause was served on July 28, 2020 (see NYSCEF Doc Nos. 14-15), the application is untimely as it was made past both the applicable cure period and lease termination.
Although plaintiff claims that counsel "timely filed" the instant application, summons and complaint, and request for judicial intervention, and paid all the related fees on June 11, 2020 and that any delay since then was caused by "the pandemic" (see NYSCEF Doc No. 48 at ¶¶ 47-50), it is unavailing as the clear language of CPLR 2211 states that a motion is made when it is served (see generally Prof. Patrick M. Connors, Practice Commentaries, McKinneys Cons Laws of NY, Book 7B, C2211:5 ["Since the order to show cause is initially submitted to the court ex-parte, one may be tempted to assume that the motion it seeks to bring on is deemed 'made' at the time of its submission. It is not."]; see id. citing Voice Communications, Inc. v Bello, 12 Misc.3d 318, 320 [Sup Ct, Nassau County 2006] ["Delivery of an order to show cause to the courthouse for signature is not the equivalent of making a motion"]).
Accordingly, the Court is without jurisdiction to grant the application (see Korova Milk Bar of White Plains, Inc., 70 A.D.3d at 648 ["Where a tenant fails to make a timely request for a temporary restraining order, a court is divested of its power to grant a Yellowstone injunction"]; KB Gallery, LLC v 875 W. 181 Owners Corp., 76 A.D.3d 909 [1st Dept 2010] ["The motion court properly found that plaintiff did not timely seek Yellowstone relief, since plaintiff did not make its application until after the applicable cure period had expired and the notice of termination had been served"] [internal citations omitted]; King Party Ctr. of Pitkin Ave. v Minco Realty, 286 A.D.2d 373, 375 [2d Dept 2001] [plaintiffs "failure to move for a restraining order before the cure period expired resulted in an irrevocable lapse of the time to cure and divested the Supreme Court of its power to grant a Yellowstone injunction"]).
Consequently, the plaintiffs arguments "addressed to the merits of the alleged defaults, including the contention that no default could occur before the 'commencement date' of the lease, are irrelevant insofar as the Yellowstone injunction is concerned" (King Party Ctr., 286 A.D.2d at 375; see 1894 Eastchester Professional Bldg, Ltd. v Christopher, 49 Misc.3d 135[A], 2015 NY Slip Op 51481 [U] [App Term, 1st Dept 2015] ["once Supreme Court determined that the Yellowstone application was untimely, the 'merits of the alleged [lease] defaults ... [became] irrelevant'"], quoting King Party Ctr., 286 A.D.2d at 375). The same applies to plaintiffs arguments claiming it cured the alleged defaults by procuring insurance - it still "needed to move for Yellowstone relief before the expiration of the specified period" (Three Amigos SJL Rest., Inc. v 250 W. 43 Owner LLC, 144 A.D.3d 490, 491 [1st Dept 2016]).
In motion sequence no. 2, plaintiff moves by order to show cause dated October 27, 2020 (NYSCEF Doc No. 70 [Feinman, J.]) to submit additional information on the Yellowstone application, namely screenshots of a text message between plaintiff and defendant's representatives, wherein plaintiff sent defendant a certificate of insurance. The motion is denied as moot as: (1) it is irrelevant to the Yellowstone application whether or not the default occurred; and (2) the certificate of insurance itself was already in the record as an exhibit submitted by the defendant in NYSCEF docket number 32.
Accordingly, it is hereby ORDERED that the motions are denied; and it is further
ORDERED that any interim relief granted in the orders to show cause or by the Court during argument are lifted.
This shall constitute the decision and order of the Court.