159 W. 23RD LLC v. Spa Ciel De Ny Corp.

• Decision Date: 15 April 2019
• Docket Number: LT-052012-19/NY
• Citation: 63 Misc.3d 1219 (A),114 N.Y.S.3d 818 (Table)
• Parties: 159 WEST 23RD LLC, Petitioner, v. SPA CIEL DE NY CORP.; "XYZ Corp.", Respondents.
• Court: New York Civil Court

63 Misc.3d 1219 (A)

114 N.Y.S.3d 818 (Table)

159 WEST 23RD LLC, Petitioner,

v.SPA CIEL DE NY CORP.; "XYZ Corp.", Respondents.

LT-052012-19/NY

Civil Court, City of New York.

Decided on April 15, 2019

Rosenberg & Estis, Attorneys for Petitioner, By: Joshua Kopelowitz, Esq., 733 Third Avenue, New York, NY 10017

David Rozenholc & Associates, Attorneys for Respondent, By: Michael B. Terk, Esq., 400 Madison Avenue, 19th Floor, New York, NY 10017

Judy H. Kim, J.

BACKGROUND

Petitioner is the owner and landlord of 159 West 23rd Street, New York NY (the "Premises"). Respondent Spa Ciel De NY Corp ("Spa Ciel") is the tenant of the basement, first floor and second floor of the Building ("the Premises") pursuant to a fifteen-year lease between Petitioner's predecessor and Spa Ciel dated November 9, 2017 (the "Lease"). "XYZ Corp." is the undertenant of Spa Ciel.

Under the terms of the Lease, Spa Ciel was obligated to, among other things: obtain all required approvals and certificates prior to any alterations, additions, installations or improvements to the Premises; ensure all contractors and sub-contractors carried the insurance required by the Landlord as set forth in the Lease; and maintain commercial general liability insurance against claims for bodily injury or death or property damage on the Premises from the date Tenant entered into possession through the term of the Lease (See Terk Affirm. in Supp. at Ex. C [Lease at ¶¶ 3, 7, 63] ).

Spa Ciel leased the Premises with the intention of converting it to a high-end day spa. In April 2018, after work on the conversion was underway, Petitioner bought the Building from the former landlord. Petitioner maintains that, in May 2018, it discovered that Spa Ciel had proceeded with the construction on the Premises without first obtaining the permits required by the New York City Department of Buildings (the "DOB") and had failed to maintain and deliver to Petitioner commercial general liability insurance effective from the date Respondent entered into possession of the Premises. Spa Ciel claims that these allegations are "false and wholly devoid of merit" but "decline[s] to address them in detail in this motion as they are not the grounds upon which dismissal is sought and, accordingly, not relevant to this pre-answer motion to dismiss" (Terk Reply Affirm. at ¶ 4).

Petitioner acknowledges that, in response to Spa Ciel's alleged failure to procure insurance, it has refused to sign a form Respondent needs to gain DOB approval for the installation of new air condition equipment in the Premises. Respondent maintains that its inability to install air condition equipment is the only impediment to opening its day spa business. Petitioner was informed of this claim by Respondent's attorneys in a letter, dated August 17, 2018 (See Terk Affirm. in Supp. at Ex. F). Respondent claims that, in light of this delay, it has not occupied the Premises since August 2018. Respondent concedes, however, that at least one of its employees has met Petitioner's superintendent at the Premises on multiple occasions between August 2018 and February 2019 to address various issues (e.g. , to fix an alarm ringing at the Premises and an intercom problem, and to inspect and repair the Building's boiler).

On or about December 7, 2018, Petitioner sent Respondent a five-day Notice of Cancellation of the Lease. In the Notice of Cancellation, Petitioner represented that Respondents were in breach of their obligations under paragraphs 3, 7, and 63 of the Lease as they had failed to: obtain the required commercial general liability insurance and ensure that all contractors and contractors were properly insured prior to commencing construction at the Premises,.

After receiving the Notice of Cancellation, Respondent remained in possession of the Premises. On January 23, 2019, Petitioner filed the Notice of Petition and Petition with the Court, seeking a final judgment awarding petition possession of the premises and a money judgment against tenant for rent arrears in the sum of $ 107,279.00.

On January 24, 2019 at approximately 4:41 p.m., Joshua Kopelowitz, Esq., counsel for Petitioner, went to the Premises to serve the Notice of Petition and Petition but was unable to gain admittance to the Premises (See Kopelowitz Aff. in Opp. at Ex. J [Affidavit of Service] ). Kopelowitz went to the Premises again on January 25, 2019, at approximately 10:10 a.m., and was again unable to gain admittance so he affixed two copies of these documents to the entrance door of the Premises (Id. ). Kopelowitz also subsequently mailed the same documents to the Premises on January 25, 2019 by First Class Mail, Certified Mail, and Certified Mail, Return Receipt Requested (Id. at Ex. J [Affidavit of Service] and Ex. N [Mailing Receipt] ).

Kopelowitz also attempted service at Respondent's President, Myoung Joo Yi's residence, located at 48A Arleigh Road, Great Neck New York (the "Yi Residence", on January 24, 2019, at 6:09 p.m., and January 25, 2019, at 9:05 a.m. (Id. at Ex. J [Affidavit of Service] ). As Kopelowitz was unable to gain admittance on either occasion, he left copies of the Notice of Petition and Petition at the Yi Residence on January 25, 2019 and also mailed copies of these documents to the Yi Residence by Certified Mail, Return Receipt Requested later that day (Id. at Ex. J [Affidavit of Service] and Ex. N [Mailing Receipt] ).

Respondent now moves to dismiss the Petition pursuant to CPLR §§ 3211(a)(1), 3211(a)(7) and 3211(a)(8), on the grounds that: (i) Petitioner failed to serve a Notice to Cure required by the Lease; and (ii) Petitioner's service of the Petition and Notice of Petition failed to satisfy the requirements of RPAPL § 735.

DISCUSSION

CPLR § 3211 provides, as relevant here that "[a] party may move for judgment dismissing one or more causes of action asserted against him on the ground that: a defense is founded upon documentary evidence; the pleading fails to state a cause of action; or the court has not jurisdiction of the person of the defendant" ( CPLR § 3211[a][1], [7], [8] ). "On a motion to dismiss pursuant to CPLR § 3211

the pleading is to be afforded a liberal construction. [The Court] accept[s] the facts as alleged in the complaint as true, accord[s] plaintiffs the benefit of every possible favorable inference, and determine[s] only whether the facts as alleged fit within any cognizable legal theory. Under CPLR § 3211(a)(1), a dismissal is warranted only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law. In assessing a motion under CPLR § 3211(a)(7), however, a court may freely consider affidavits submitted by the plaintiff to remedy any defects in the complaint and the criterion is whether the proponent of the pleading has a cause of action, not whether he has stated one

( Leon v. Martinez , 84 NY2d 83, 87-88 [1994] [internal quotations omitted] ).

Respondent argues that, as a threshold matter, this proceeding must be dismissed because Petitioner failed to serve a predicate notice of default required by the Lease. Paragraph 17 of the Lease provides, as relevant here, that:

if Tenant defaults in fulfilling any of the covenants of this lease other than the covenants for the payment of rent or additional rent then in any one or more of such events, upon Owner serving a written fifteen (15) days notice upon Tenant specifying the nature of said default, and upon the expiration of said fifteen (15) days period, and if Tenant shall not have diligently commenced curing such default within such fifteen (15) day period, and shall not thereafter with reasonable diligence and in good faith proceed to remedy or cure such default, then Owner may serve a written five (5) days notice of cancellation of this lease upon Tenant, and upon the expiration of said five (5) days, this lease and the term thereunder shall end and expire

(Terk Affirm. at Ex C [Lease at ¶ 17] ).

Petitioner concedes that it did not serve a notice of default but claims that no such notice was necessary because the default at issue here was incurable. The Court agrees. In general, "where a landlord fails to serve a requisite notice to cure, the lease remains in effect and the tenancy cannot be terminated" ( 2215-75 Cruger Apartments, Inc. v. Stovel , 196 Misc 2d 346, 347 [App Term 1st Dept 2003] ). An exception exists, however "in circumstances where a cure is impossible" (Id. ). The rationale for this exception is that, although a lease or statute provides time for a cure, the existence of such a provision "does not necessarily imply that a means or method to cure must exist in every case" of default ( Adam's Tower Ltd. Partnership v. Richter , 186 Misc 2d 620, 622 [App Term, 1st Dept 2000] [internal citations omitted] ). Where no such means or method of cure exists, "[t]o insist upon the service of a formal notice to cure in such circumstances is to compel the performance of a useless and futile act" ( 326-330 E. 35th St. Assoc. v. Sofizade , 191 Misc 2d 329, 331 [App Term 1st Term 2002] ).

In a holdover summary proceeding based upon tenant's failure to pay rent, the Appellate Term, First Department rejected "tenant's assertion, that the landlord's election to forego serving a prepetition notice to cure [was] fatal to its possessory claim," holding that "the cumulative pattern of tenant['s] course of conduct" was incapable of any meaningful cure ( Sofizade ,191 Misc 2d at 330 [App Term, 1st Dept 2002] citing Adam's Tower Ltd. Partnership v. Richter , 186 Misc 2d 620, 622 [App Term, 1st Dept 2000] and 3363 Sedgwick v. Medina , 187 Misc 2d 421 [App Term, 1st Dept] ). The Sofizade court found that the notice requirement of the lease — which was substantially similar to paragraph 17 of the Lease — was "intended to cover the not uncommon situation in which a full cure of a correctable lease default is not feasible within 10 days [but could not] reasonably be read to require the landlord to provide tenant with a...