Cal. Suites, Inc. v. Russo Demolition Inc.

• Decision Date: 31 May 2012
• Parties: CALIFORNIA SUITES, INC., Plaintiff–Appellant, v. RUSSO DEMOLITION INC., et al., Defendants, The City of New York, et al., Defendants–Respondents.
• Court: New York Supreme Court — Appellate Division

98 A.D.3d 144

946 N.Y.S.2d 55

2012 N.Y. Slip Op. 04237

CALIFORNIA SUITES, INC., Plaintiff–Appellant,

v. RUSSO DEMOLITION INC., et al., Defendants,The City of New York, et al., Defendants–Respondents.

Supreme Court, Appellate Division, First Department, New York.

May 31, 2012.

Altman Schochet LLP, New York (Irina Fulman, Zalman Schochet and Michael A. Valentine of counsel), for appellant.

Michael A. Cardozo, Corporation Counsel, New York (Victoria Scalzo, Stephen J. McGrath and Karen Selvin of counsel), for respondents.

PETER TOM, J.P., DAVID B. SAXE, JOHN W. SWEENY, JR., ROSALYN H. RICHTER, SALLIE MANZANET–DANIELS, JJ.

TOM, J.P.

In September 2006, plaintiff, the owner of a six-story hotel located at 610 West 111th Street in Manhattan, known as the Ellington Hotel, was issued a building permit by the Department of Buildings (DOB) to construct a five-story addition on the roof of the hotel. In October, the DOB halted construction at the site and conducted an audit, issuing a list of objections to the work that had been performed.

In November 2006, the DOB notified plaintiff of its intent to revoke the permit based on the objections raised on the audit unless plaintiff demonstrated why the permit should not be revoked. In May 2007, the DOB revoked all permits and directed that all work cease. In June 2008, the DOB conducted a structural integrity assessment of the illegally altered building and concluded that due to improper construction, the “structural stability of the building [hotel] is affected,” and a “Life-safety risk is present due to the lack of required egress from the building-accesses to the roof and exits from the roof.” The DOB issued an “Emergency Declaration” dated June 23, 2008, informing plaintiff that the “building, or [a] portion thereof, has been declared unsafe and in imminent peril,” that “because of the severity of the condition,” the structure “must be repaired or demolished immediately” and that “responsibility to take such action is yours.” The Emergency Declaration further states that the City would perform the necessary remedial work at plaintiff's expense if plaintiff failed to cure the defects. The New York City Department of Housing Preservation and Development (DHPD) sent plaintiff an “Urgent Notice,” dated July 14, 2008 advising that it would retain a contractor, at plaintiff's expense, to cure the emergency condition unless plaintiff acted immediately. Plaintiff failed to respond, and DHPD engaged defendant Russo Demolition, Inc. to conduct remedial work. Between August 18 and August 25, 2008, Russo Demolition undertook and completed the demolition of the steel structure erected on the roof of the premises.

On August 26, 2008, plaintiff commenced this action against Russo Demolition alleging trespass, conversion and negligence. The complaint has since been amended, first to add the municipal defendants and, again, to name a second Russo defendant, A. Russo Wrecking, Inc. (collectively, Russo). The second amended complaint asserts that on or about August 19, 2008, Russo, acting on behalf of the municipal defendants, unlawfully entered onto plaintiff's hotel property and removed the steel structure from the roof. The complaint further asserts that Russo failed to provide any evidence of its authority to remove the steel structure despite plaintiff's repeated requests.

As noted, the original complaint, which had alleged trespass and conversion, named only Russo Demolition as defendant. Legal proceedings were initiated on August 21, 2008, when plaintiff applied for a temporary restraining order and preliminary injunction against any further entry onto its premises or removal of its property by Russo Demolition. The municipal defendants were added some seven months later, when the complaint was amended on March 17, 2009. The complaint assumed its present form when it was amended several months later to add a cause of action for negligence.

It may be fairly inferred from the second amended complaint that plaintiff alleges Russo lacked lawful authority to remove the steel structure from the roof of plaintiff's hotel because the DHPD likewise lacked lawful authority to direct Russo to perform the necessary demolition work. However, the issue of lack of notice was first raised in plaintiff's opposition papers to defendant's dismissal motion, which, relying on Calamusa v. Town of Brookhaven, 272 A.D.2d 426, 708 N.Y.S.2d 317 (2000) and Scott v. Town of Duanesburg, 176 A.D.2d 989, 574 N.Y.S.2d 833 [1991] ), advanced the theory that the municipal defendants' failure to provide notice and opportunity to be heard before the demolition work was performed “is a violation of due process rights for which liability will attach” (internal quotation marks omitted). Therefore, by way of cross motion, plaintiff sought to amend the complaint to allege explicitly that the demolition work was performed “without providing to Plaintiff notice of the Municipal Defendants' intent to demolish the steel structure and an opportunity to cure the existing condition, to the extent such condition was dangerous or unsafe.”

Defendants' motion to dismiss asserted that the complaint fails to state a cause of action for conversion, trespass or negligence, arguing that absolute immunity extends to acts within the exercise of administrative discretion—here, the determination that removal of the steel structure was warranted. Furthermore, the municipal defendants alleged that plaintiff had received the requisite notice of the proposed removal of the dangerous offending structure by certified mail.

In opposition, plaintiff contended that it “ never received such notice.” The opposing papers included the affidavit of Alan Lapes, the owner of the property, who stated, “I never received these notices. Moreover, no agent of California Suites Inc. ever signed any ‘certified mail’ receipt allegedly delivered with said notice.”

In reply, the City agencies furnished affidavits by their employees attesting to their regular business practice in issuing and mailing official notices. They further produced a tracking notice from the United States Postal Service indicating that the certified mailing was signed for by one Samal Nur and had been delivered at 3:39 p.m. on July 18, 2008.

In further opposition to the motion (denominated “sur-reply”), plaintiff submitted another affidavit from Alan Lapes stating that “the Secretary of State was directed to forward process it accepted on behalf of the corporation to 610 West 111th Street” and that the Department of Buildings had previously “mailed all notices relating to the condition of the building to the 610 address.” Lapes did not deny that plaintiff maintains an office at 850 West End Avenue, where notices were sent by the municipal defendants; remarkably, he stated that plaintiff “has used the 850 address to receive financial and tax information from the Department of Finance in connection with the subject building ... and for no other purpose.” Nor did Lapes offer any explanation why Samal Nur should not be regarded as plaintiff's agent or employee despite having signed for the certified mailing on behalf of plaintiff in that capacity. Nowhere in Lapes's affidavit does he deny that Samal Nur was plaintiff's employee. The Lapes affidavit was accompanied by the affirmation of counsel raising, for the first time, the contention that notice of the proposed demolition was required to be given “in accordance with the civil practice law and rules of the state of New York” (citing Administrative Code of City of N.Y. § 28–216.4).

This matter is now before us on plaintiff's appeal from the award of summary judgment dismissing the action as against the municipal defendants (CPLR 3211[a][7] ), and the denial of plaintiff's cross motion for leave to amend the complaint yet again (CPLR 3025[b] ). The motion court held that plaintiff had received notice of the proposed demolition and that the municipal defendants were immune from liability for discretionary acts performed in an official capacity.

Plaintiff cites Calamusa, 272 A.D.2d 426, 708 N.Y.S.2d 317 and Scott, 176 A.D.2d 989, 574 N.Y.S.2d 833, in support of its contention that its constitutional rights to due process were violated because the municipal defendants failed to provide notice to plaintiff of the demolition and an opportunity to cure the defective condition. Although the cited cases are facially similar to this matter, they involve different statutes and the particular factual and procedural context is unclear.

In Calamusa, a case in which an injury to property was alleged, the Second Department stated:

“A municipality may demolish a building without providing notice and an opportunity to be heard if there are exigent circumstances which require immediate demolition of the building to protect the public from imminent danger. In this case, immediate action was not required and there was time to provide notice and an opportunity to be heard. Therefore, the failure to provide the same is a violation of due process rights for which liability will attach” ( Calamusa, 272 A.D.2d at 427, 708 N.Y.S.2d 317 [internalcitations and quotation marks omitted] ).

In Scott, as in the instant matter, the complaint alleged trespass, negligence and intentional destruction of property (but not conversion). The Third Department held that “defendant did not properly act according to its police powers in demolishing plaintiff's campsite structure because it failed to comply with plaintiff's statutory and due process rights to notice and an opportunity to be heard before the structure was declared unsafe” ( Scott, 176 A.D.2d at 991, 574 N.Y.S.2d 833). The Court rejected the defense of immunity, stating, “The decision to demolish without giving notice and an opportunity to be heard cannot be classified as a discretionary decision as fundamental due process compels the result ... removing discretion” ( id.).

These cases both involve the issue...