Raach v. Slsjet Mgmt. Corp.

• Decision Date: 09 December 2015
• Citation: 134 A.D.3d 792,20 N.Y.S.3d 613
• Parties: Walid RAACH, et al., appellants, v. SLSJET MANAGEMENT CORP., also known as Yellow Cab SLSJET Management Corp., respondent.
• Court: New York Supreme Court — Appellate Division

134 A.D.3d 792

20 N.Y.S.3d 613

Walid RAACH, et al., appellants,

v.SLSJET MANAGEMENT CORP., also known as Yellow Cab SLSJET Management Corp., respondent.

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

Dec. 9, 2015.

David Abrams, New York, N.Y., for appellants.

Herrick, Feinstein LLP, New York, N.Y. (Chantelle L. Aris and Susan T. Dwyer of counsel), for respondent.

REINALDO E. RIVERA, J.P., THOMAS A. DICKERSON, ROBERT J. MILLER, and JOSEPH J. MALTESE, JJ.

In an action to recover damages for breach of contract, the plaintiffs appeal, as limited by their brief, from so much of an order of the Supreme Court, Queens County (Weiss, J.), dated November 25, 2014, as granted those branches of the defendant's motion which were, in effect, pursuant to CPLR 3211(a)(1) and (7) to dismiss so much of the complaint as alleged breach of contract based upon the defendant's alleged improper retention of monies in excess of the applicable daily lease rate as set forth in the parties' lease agreements and based upon alleged violations of certain provisions of the parties' lease agreements governing the imposition of late fees.

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, and those branches of the defendant's motion which were, in effect, pursuant to CPLR 3211(a)(1) and (7) to dismiss so much of the complaint as alleged breach of contract based upon the defendant's alleged improper retention of monies in excess of the applicable daily lease rate as set forth in the parties' lease agreements and based upon alleged violations of certain provisions of the parties' lease agreements governing the imposition of late fees are denied.

The plaintiffs were taxicab drivers who leased cars and taxi medallions from the defendant. The plaintiffs commenced this action against the defendant to recover damages for breach of contract. In the complaint, the plaintiffs alleged that the defendant breached certain daily lease agreements by improperly retaining monies in excess of the applicable daily lease rate as set forth in the agreements and by failing to comply with certain provisions of the agreements governing the imposition of late fees.

The defendant moved pursuant to CPLR 3211(a) to dismiss the complaint. The Supreme Court, inter alia, granted those branches of the defendant's motion which were, in effect, pursuant to CPLR 3211(a)(1) and (7) to dismiss so much of the complaint as alleged breach of contract based upon the defendant's alleged improper retention of monies in excess of the applicable daily lease rate as set forth in the parties' lease agreements and based upon alleged violations of certain provisions of the lease agreements governing the imposition of late fees. The plaintiffs appeal from those portions of the order. We reverse the order insofar as appealed from.

In considering a motion to dismiss a cause of action pursuant to CPLR 3211(a)(7), "the court must accept the facts as alleged in the complaint as true, accord plaintiffs the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory" (Sokol v. Leader, 74 A.D.3d 1180, 1181, 904 N.Y.S.2d 153 [internal quotation marks omitted]; see Nonnon v. City of New York, 9 N.Y.3d 825, 827, 842 N.Y.S.2d 756, 874 N.E.2d 720 ; Leon v. Martinez, 84 N.Y.2d 83, 87–88, 614 N.Y.S.2d 972, 638 N.E.2d 511 ).

Here, contrary to the Supreme Court's conclusion, the complaint does not seek to privately enforce the Rules of the City of New York Taxi and Limousine Commission (hereinafter TLC Rules). Rather, the complaint alleged that certain TLC Rules were expressly incorporated into the parties' daily lease agreements (cf. Pervaiz v. Queens Medallion Leasing, Inc., 107 A.D.3d 554, 554–555, 967 N.Y.S.2d 714 ; Rashid v. B. Taxi Mgt., Inc., 107 A.D.3d 555, 556, 967 N.Y.S.2d 380 ; De La Rosa v. All Taxi Mgt., Inc., 107 A.D.3d 553, 553, 967 N.Y.S.2d 715 ; Desmangles v. Woodside Mgt., Inc., 107 A.D.3d 551, 552, 968 N.Y.S.2d 454 ). The fact that the contractual provisions at issue may have been inserted in order to comply with TLC Rules does not extinguish the plaintiffs' right to enforce those contractual provisions by asserting a cause of action alleging breach of contract (accord Cox v. NAP Constr. Co., Inc., 10 N.Y.3d 592, 602, 861 N.Y.S.2d 238, 891 N.E.2d 271 ; Wright v. Wright Stucco, 50 N.Y.2d 837, 430 N.Y.S.2d 52, 407 N.E.2d 1348 ; Fata v. S.A. Healy Co., 289 N.Y. 401, 406–407, 46 N.E.2d 339 ; Strong v. American Fence Constr. Co., 245 N.Y. 48, 53, 156 N.E. 92 ; Melissakis v. Proto Constr. & Dev. Corp.,

294 A.D.2d 342, 342, 741 N.Y.S.2d 731 ). Accordingly, affording the complaint a liberal construction, accepting all facts as alleged in the complaint to be true, and according the plaintiffs the benefit of every possible favorable inference, the plaintiffs stated a cause of action to recover damages for breach of contract based upon the defendant's alleged improper retention of monies in excess of the applicable daily lease rate as set forth in the parties' lease agreements and based upon alleged violations of the provisions of the parties' lease agreements governing the imposition of late fees.

The Supreme Court also erred to the extent that it directed the dismissal of those portions of the complaint pursuant to CPLR 3211(a)(1). Contrary to the defendant's contention, the arguments raised by the plaintiffs on...