Matias v. Mondo Properties LLC

• Decision Date: 30 August 2007
• Docket Number: 1157.,M-2590.
• Citation: 841 N.Y.S.2d 279,2007 NY Slip Op 06522,43 A.D.3d 367
• Parties: ANDREW MATIAS, an Infant, by His Mother and Natural Guardian, LETICIA PALMA, et al., Respondents, v. MONDO PROPERTIES LLC et al., Defendants, and JACKIE LORA et al., Appellants.
• Court: New York Supreme Court — Appellate Division

43 A.D.3d 367

841 N.Y.S.2d 279

2007 NY Slip Op 06522

ANDREW MATIAS, an Infant, by His Mother and Natural Guardian, LETICIA PALMA, et al., Respondents, v. MONDO PROPERTIES LLC et al., Defendants, and JACKIE LORA et al., Appellants.

1157.

M-2590.

Appellate Division of the Supreme Court of the State of New York, First Department.

Decided August 30, 2007.

Order, Supreme Court, Bronx County (George D. Salerno, J.), entered October 11, 2006, which denied defendants-appellants' motion for summary judgment dismissing the complaint as against them, unanimously reversed, on the law, without costs, the motion granted and the complaint dismissed as against appellants. The Clerk is directed to enter judgment accordingly.

Plaintiffs commenced this action to recover damages for injuries infant plaintiff allegedly sustained from lead paint and dust exposure in the apartment he and his mother occupied at 1045 Boynton Avenue and in his aunt's apartment at 1040 Boynton Avenue in the Bronx. Defendant, WDJ Realty V LLC, is the owner and managing agent of the premises at 1045 Boynton Avenue, and defendant, WDJ Realty VI LLC,^* is the owner and managing agent of the premises at 1040 Boynton Avenue. Appellant Lora transferred her ownership interest in defendant companies to appellant Pignone in February 2000. Pignone was a shareholder, member and president of WDJ Realty V and VI from February 2000 through November 2004.

Appellants moved to dismiss the complaint as against them contending they could not be held liable for infant plaintiff's alleged injuries in their individual capacities. Supreme Court found appellants did not meet their burden of proof to establish that Lora was not an officer, shareholder, or director of the premises, or that she was not involved with the management or control of the premises. Supreme Court further found issues of fact as to whether Pignone was acting within the scope of her employment. Finally, Supreme Court found appellants to be owners pursuant to Multiple Dwelling Law § 4 (44).

We reverse.

A member of a limited liability company "cannot be held liable for the company's obligations by virtue of his [or her] status as a member thereof" (Retropolis, Inc. v 14th St. Dev. LLC, 17 AD3d 209, 210 [2005]; see also Limited Liability Company Law §§ 609, 610). Plaintiffs seek to hold individual defendants liable despite this statutory proscription. In order to pierce the "corporate veil," a doctrine applicable to limited liability companies (see Retropolis at 210, citing Williams Oil Co. v Randy Luce E-Z Mart One, 302 AD2d 736, 739-740 [2003]), plaintiffs bear "`a heavy burden of showing that the [company] was dominated [by the owners] as to the transaction attacked and that such domination ... resulted in wrongful ... consequences'" (id., quoting TNS Holdings v MKI Sec. Corp., 92 NY2d 335, 339 [1998]; see also Matter of Morris v New York State Dept. of Taxation & Fin., 82 NY2d 135, 141 [1993]). Plaintiffs have failed to raise any such triable issues of fact.

Appellants submitted competent evidence that neither of them owned or managed either 1040 or 1045 Boynton Avenue in an individual capacity. As to Lora, plaintiffs concede that she was no longer involved with the business entities that owned and controlled the two buildings as of February 2000, three months before plaintiffs became tenants at 1045 Boynton Avenue. Thus, Lora cannot be held liable for the exposure at plaintiffs' apartment. While the complaint alleges a period of exposure that includes a time period predating Lora's transfer of ownership, namely, November 1999 through July 2001, which...