Opinion
No. LT-304166/2021
12-16-2022
Wilbee Corporation, Petitioner-Landlord v. Olympian Summit, Inc., a/k/a OLYMPIAN SUMMIT, Respondent-Tenant, "XYZ" CORPORATION, Respondent-Undertenant.
Unpublished Opinion
Claudia Lanzetta, J.
The following papers numbered 1 to 3 were read on petitioner's motion to dismiss respondent's ten affirmative defenses, to amend the petition, for summary judgment and for attorney's fees.
Papers Numbered
Notice of Motion, Affirmation, Affidavits, Memorandum of Law, Exhibits 1
Memorandum of Law in Opposition, Affidavit 2
Memorandum of Law in Reply 3
Upon the foregoing papers, as well as a conference/oral argument at the calendar call, the determination on this motion is as follows:
Petitioner commenced this commercial non-payment proceeding in June 2021 seeking rent and additional rent in the amount of $347,314.44. Respondent interposed its Answer on July 25, 2021 and petitioner then filed the instant motion in September 2021. This motion seeks to dismiss all ten of respondent's affirmative defenses, leave to amend the petition to include fixed and additional rent accrued during the pendency of this proceeding through the date of the instant motion, summary judgment in favor of petitioner awarding a possessory and monetary judgment, and awarding attorney's fees as provided for in the Lease.
Petitioner's request to dismiss respondent's affirmative defenses, save impossibility, frustration of purpose, and causality is granted as unopposed. Respondent abandoned these defenses by failing to oppose those portions of the motion seeking their dismissal, (see Kronick v LP Thebault Co., Inc., 70 A.D.3d 648, 649 [2nd Dept. 2010]; Genovese v Gambino, 309 A.D.2d 832, 833 [2nd Dept. 2003]). Similarly, petitioner's request to amend the petition to reflect fixed and additional rent that has accrued through the date of the instant motion is granted, (see CPLR 3025(c); see also Rodriguez v Panjo, 81 A.D.3d 805, 806 [2nd Dept. 2011]), and the amount sought is hereby amended to $440,856.59, to include all sums due and owing from March 2020 through and including September 2021. Finally, petitioner's request for an order awarding attorney's fee pursuant to paragraph 53 of the Lease was likewise unopposed and, in the event petitioner is successful in this proceeding, that request is granted, and a hearing will be held to determine fees incurred.
The court is left with petitioner's request to dismiss the affirmative defenses of impossibility, frustration of purpose, and causality, along with their request for summary judgment, for which they argue that if all affirmative defenses are dismissed and respondent is left with none, there are no genuine issues of material fact. Summary judgment is a drastic remedy that does not deny the parties a trial, but merely posits there is nothing to try, (see Suffolk County Dept. of Social Svcs. v James M., 83 N.Y.2d 178, 182 [1994] [ internal citations omitted]). It is only to be employed when there is no doubt as to the existence of genuine issues of material fact, (see CPLR §3212[b]; Zuckerman v City of New York, 49 N.Y.2d 557, 562 [1980]; see also Alvarez v Prospect Hosp., 68 N.Y.2d 320, 324 [1986]; Winegrad v New York Univ. Med. Ctr., 64 N.Y.2d 851, 852 [1985]; Sillman v Twentieth Century-Fox Film Corp., 3 N.Y.2d 395, 404 [1957]). Having demonstrated a landlord-tenant relationship between the parties, respondent-tenant's obligation to pay fixed and additional rent pursuant to a Lease Agreement, and respondent's default in satisfying that obligation, contentions unrefuted by respondent, petitioner has met its prima facie burden in this proceeding, (see RPAPL §711(2); see also 329 Union Bldg. Corp. v LoGuidice, 47 Misc.3d 1, 6 [App Term, 2nd, 11th, and 13th Jud. Dists. 2015]), and the court is solely left with the applicability of the above-mentioned affirmative defenses.
Their validity in this proceeding warrants denial of the summary request, while their irrelevance mandates approval and the issuance of ultimate judgments against respondent. In light of the unprecedented response to the COVID-19 pandemic by way of State-wide mandated complete shutdowns for all businesses, especially businesses like the one at issue here, the latter result smacks of inequity and harshness, (see Intl. Plaza Assoc., L.P. v Amorepacific US, Inc., 2020 WL 8019740 [Sup Ct, New York County Nov. 2020]). Notwithstanding, it has become settled that these affirmative defenses, raised when COVID-19 closures are the basis for non-payment of rent, are inapposite; their utility has been rejected by the courts time and again, (see e.g. Fives 160th LLC v Zhao, 204 A.D.3d 439 [1st Dept. 2022], Valentino USA, Inc. v 693 Fifth Owner LLC, 203 A.D.3d 480 [1st Dept. 2022], 558 Seventh Ave. Corp. v Times Sq. Photo, Inc., 194 A.D.3d 561 [1st Dept. 2021], Gap, Inc. v 170 Broadway Retail Owner, LLC, 195 A.D.3d 575 [1st Dept. 2021], Arista Development, LLC v Clearmind Holdings, LLC, 207 A.D.3d 1127 [4th Dept. 2022]). Consequently, and because the Appellate Division, Second Department has not spoken directly to this issue, (see generally Mountain View Coach Lines v Storms, 102 A.D.2d 663, 664-665 [2nd Dept. 1984]), the court is constrained to grant petitioner's request for dismissal of the remaining three affirmative defenses and resultantly, grant petitioner's request for summary judgment.
Respondent operates a billiards hall.
The court sought to distinguish cases relied on by petitioner as not involving businesses like respondent's, i.e. businesses that were permitted, after initial closure, to engage in alternative forms of patron interaction and different methods of delivering the goods and services incident to the business, for example, by offering curbside deliver, (see e.g. 558 Seventh Ave. Corp. v Times Sq. Photo, Inc., supra at 561-562; A/R Retail LLC v Hugo Boss Retail, Inc., 72 Misc.3d 627, 149 N.Y.S.3d 808, 823-824 [Sup Ct, New York County 2021]). However, those efforts were defeated by cases, such as CAB Bedford LLC v Equinox Bedford Ave., Inc., (2020 NY Slip Op 34296(U), [Sup Ct, New York County Dec. 2020]; see also Amherst II UE LLC v Fitness Intl. LLC, 74 Misc.3d 1203 (A) [Sup Ct, Erie County 2021]). CAB Bedford involved a gym that, like respondent's business, was not permitted to open at all for an extended period and, by virtue of the services provided, could not offer alternative methods of distribution. Despite these conditions, the court still found the doctrines, sought to be relied on here, impotent, and granted summary judgment to the landlord, (id at *4).
The court recognizes that some small-scale gyms, fitness centers and the like, engaged in outdoor and on-line classes, but larger facilities, such as Equinox, did not elect to participate in these endeavors.
Furthermore, cases relied on by respondent, Intl. Plaza Assoc., L.P. v Amorepacific US, Inc., (supra), 267 Development, LLC v Brooklyn Babies and Toddlers, LLC, (2021 WL 3371187 [Sup Ct, New York County 2021]), and 188 Ave. A Take Out Food Corp. v Lucky Jab Realty Corp., (2020 WL 7629597 [Sup Ct, New York County 2020]), have all had their reasoning undermined and rejected by subsequent cases from higher courts, (see Fives 160th LLC v Zhao, supra; 558 Seventh Ave. Corp. v Times Sq. Photo, Inc., supra; see also Premier Valet, LLC v Premier Valet Serv's LLC, 2022 WL 3204902 at *3 [ED Miss Div Two 2022]; Gap Inc. v Ponte Gadea New York LLC, 524 F.Supp.3d 224 [US Dist Ct, S.D. NY 2021]).
Essentially respondent is asking this Court to carve out an extremely narrow exception to the rejection of the affirmative defenses of frustration, impossibility, and causality as a bar to the landlord's recovery of rent, in the case of billiard halls. This court reluctantly declines to do so because: 1) it would raise the same questions and run afoul of the caveats discussed in CAB Bedford, (2020 NY Slip Op 34296(U) at *6); and 2) ultimately, respondent's arguments are based on the alleged unforeseeability of the event and response thereto. Again, these arguments have been denied, (see e.g. CAB Bedford LLC v Equinox Bedford Ave., Inc., supra; A/R Retail LLC v Hugo Boss Retail, Inc., supra), and, in this case, the argument is belied by paragraph 27 of the Lease which, provides that tenant's obligations to pay rent shall in no way be affected, impaired, or excused if the Landlord is prevented from fulfilling its obligations by reason of "governmental preemption in connection with a National Emergency or by reason of any rule, order or regulation of any department or subdivision thereof of any government agency" (see Pet'r exh. I at para. 27; see also Pet'r exh. J and K) (see CAB Bedford LLC v Equinox Bedford Ave., Inc., supra at *2). Finally, this Court agrees with the CAB Bedford Court, that despite any feelings of empathy, given the role of the courts and the widespread nature of the issues underlying this proceeding, resolution is more appropriately a responsibility of the other branches of government, (id at *6).
In summary, petitioner's motion is granted in its entirety; respondent's affirmative defenses are hereby dismissed, the petition is amended to reflect fixed and additional rent that has accrued through the date of the instant motion, summary judgment is awarded in petitioner's favor against respondent, and petitioner is awarded attorney's fees in an amount to be determined at a subsequent hearing.
A final Judgment of Possession is awarded to petitioner against respondent, along with a Warrant of Eviction to be issued forthwith. The earliest date of execution is December 19, 2022. Petitioner is awarded a money judgment in the amount of $440,856.59, plus interest, costs and disbursements, and the Clerk is respectfully directed to enter Judgments accordingly.
A hearing will be scheduled with respect to attorney's fees upon petitioner's counsel notifying the court and opposing counsel.
This is the Decision and Order of the Court.
A copy of this Decision and Order has been sent to counsel for both parties on the same day as signed.