Courthouse Corporate Ctr. LLC v. Schulman

• Decision Date: 01 June 2010
• Citation: 74 A.D.3d 725,902 N.Y.S.2d 160
• Parties: COURTHOUSE CORPORATE CENTER LLC, respondent, v. Richard SCHULMAN, etc., et al., appellants.
• Court: New York Supreme Court — Appellate Division

902 N.Y.S.2d 160

74 A.D.3d 725

COURTHOUSE CORPORATE CENTER LLC, respondent,

v.Richard SCHULMAN, etc., et al., appellants.

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

June 1, 2010.

Michael B. Schulman & Associates, P.C., Melville, N.Y., for appellants.

Bauman Katz & Grill, LLP, New York, N.Y. (Daniel E. Katz and David M. Grill of counsel), for respondent.

STEVEN W. FISHER, J.P., FRED T. SANTUCCI, RANDALL T. ENG, and CHERYL E. CHAMBERS, JJ.

In an action, inter alia, to recover damages for breach of acommercial lease, the defendants appeal, as limited by their brief, from so much of an order of the Supreme Court, Suffolk County (Gazzillo, J.), dated February 23, 2009, as granted those branches of the plaintiff's motion which were pursuant to CPLR 3211(b) to dismiss the affirmative defenses of collateral estoppel and res judicata, and denied their cross motion for summary judgment dismissing the first and second causes of action based on the doctrines of collateral estoppel and res judicata, and for summary judgment dismissing the complaint insofar as asserted against the defendant Richard Schulman, individually and doing business as LAN Associates.

ORDERED that the order is affirmed insofar as appealed from, with costs.

In October 2001 the plaintiff, Courthouse Corporate Center LLC (hereinafter CCC), as lessor, entered into a commercial lease with the defendant LAN Associates (hereinafter LAN), as lessee. The lease was for a term of seven years and two months, beginning in December 2001 and ending in January 2009. The individual defendant, Richard Schulman, signed the lease as "Richard Schulman, Pres."

During the term of the lease, disputes arose over conditions in the premises and LAN's alleged nonpayment of rent. LAN commenced an action against CCC seeking, inter alia, a Yellowstone injunction ( see First Natl. Stores v. Yellowstone Shopping Ctr., 21 N.Y.2d 630, 290 N.Y.S.2d 721, 237 N.E.2d 868). Thereafter, CCC commenced a holdover proceeding and, eventually, the parties to the lease stipulated, among other things, that LAN would vacate the premises. CCC then commenced this action against LAN, as well as against Schulman, individually and doing business as LAN, inter alia, seeking damages for breach of the lease. CCC alleged that Schulman was individually liable on the ground that LAN was not an entity licensed to conduct business in New York State and, alternatively, under the doctrine of piercing the corporate veil. In its first and second causes of action, CCC sought to recover unpaid rent for the period of April 2005 through March 2007, as well as an attorneys' fee in connection with its attempts to collect that rent. In their answer, the defendants raised the affirmative defenses of res judicata and collateral estoppel with respect to those causes of action, and LAN also asserted a counterclaim against CCC.

Eventually, CCC moved pursuant to CPLR 3211(b) to dismiss those affirmative defenses and LAN's counterclaim, and the defendants cross-moved for summary judgment dismissing the first and second causes of action on the basis of those defenses and dismissing the complaint insofar as asserted against Schulmanindividually and doing business as LAN. The Supreme Court granted CCC's motion to dismiss the affirmative defenses and the counterclaim and denied the defendants' cross motion. The defendants appeal from so much of the order as granted those branches of CCC's motion which were to dismiss the defendants' affirmative defensesand denied their cross motion. We affirm the order insofar as appealed from.

Pursuant to CPLR 3211(b), a party may move for judgment dismissing one or more defenses on the ground that a defense is not stated or has no merit. "In reviewing a motion to dismiss an affirmative defense, the court must liberally construe the pleadings in favor of the party asserting the defense and give that party the benefit of every reasonable inference" ( Fireman's Fund Ins. Co. v. Farrell, 57 A.D.3d 721, 723, 869 N.Y.S.2d 597; see Butler v. Catinella, 58 A.D.3d 145, 147-148, 868 N.Y.S.2d 101). Here, the Supreme Court properly granted those branches of CCC's motion which were pursuant to CPLR 3211(b) to dismiss the affirmative defenses of...