Treeline 1 OCR, LLC v. Nassau County Indus. Dev. Agency

• Court: New York Supreme Court — Appellate Division
• Writing for the Court: MARK C. DILLON
• Citation: Treeline 1 OCR, LLC v. Nassau County Indus. Dev. Agency, 918 N.Y.S.2d 128, 82 A.D.3d 748 (N.Y. App. Div. 2011)
• Decision Date: 01 March 2011
• Parties: TREELINE 1 OCR, LLC, appellant, v. NASSAU COUNTY INDUSTRIAL DEVELOPMENT AGENCY, respondents, et al., defendants.

918 N.Y.S.2d 128

82 A.D.3d 748

TREELINE 1 OCR, LLC, appellant,

v.NASSAU COUNTY INDUSTRIAL DEVELOPMENT AGENCY, respondents, et al., defendants.

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

March 1, 2011.

Sanders Law Firm, PLLC, Garden City, N.Y. (Craig B. Sanders of counsel), for appellant.

Harter Secrest & Emery, LLP, Rochester, N.Y. (Paul D. Sylvestri and Julia Green Sewruk of counsel), for respondents NL Ventures IV Voice, L.P. and NL Ventures IV Voice Management, LLC.

Cullen and Dykman LLP, Garden City, N.Y. (Douglas J. Bohn and Peter J. Mastaglio of counsel), for respondent Manley Holdings, Inc.

Drinker Biddle & Reath LLP, New York, N.Y. (Michael O. Adelman of counsel), for respondent CAWSL Enterprises, Inc.

MARK C. DILLON, J.P., RUTH C. BALKIN, JOHN M. LEVENTHAL, and CHERYL E. CHAMBERS, JJ.

In an action, inter alia, to recover damages for injury to real property, the plaintiff appeals (1), as limited by its notice of appeal and brief, from so much of an order of the Supreme Court, Nassau County (Warshawsky, J.), entered September 28, 2009, as granted those branches of the motion of the defendants NL Ventures IV Voice, L.P., and NL Ventures Voice Management, LLC, which were pursuant to CPLR 3211(a)(1) to dismiss the complaint insofar as asserted against them and granted those branches of the separate motion of the defendant Manley Holdings, Inc., joined by the defendant Nassau County Industrial Development Agency, which were pursuant to CPLR 3211(a)(1) and (7) to dismiss the first, second, third, fourth, and fifth causes of action insofar as asserted against those defendants, and (2), as limited by its brief, from so much of an order of the same court entered March 22, 2010, as granted those branches of the motion of the defendant CAWSL Enterprises, Inc., which were pursuant to CPLR 3211(a)(1) and (7) to dismiss the first, second, third, fourth, and fifth causes of action insofar as asserted against that defendant.

ORDERED that the order entered September 28, 2009, is modified, on the law, by deleting the provision thereof granting that branch of the motion of the defendants NL Ventures IV Voice, L.P., and NL Ventures Voice Management, LLC, which was pursuant to CPLR 3211(a)(1) to dismiss the complaint insofar as asserted against the defendant NL Ventures Voice Management, LLC, and substituting therefor a provision denying that branch of the motion; as so modified, the order entered September 28, 2009, is affirmed insofar as appealed from, and it is further,

ORDERED that the order entered March 22, 2010, is reversed insofar as appealed from, on the law, and those branches of the motion of the defendant CAWSL Enterprises, Inc., which were pursuant to CPLR 3211(a)(1) and (7) to dismiss the first, second, third, fourth, and fifth causes of action insofar as asserted against it are denied; and it is further,

ORDERED that one bill of costs is awarded to the plaintiff, payable by the defendants CAWSL Enterprises, Inc., and the defendants NL Ventures IV Voice, L.P., and NL Ventures Voice Management, LLC, appearing separately and filing separate briefs, and one bill of costs is awarded to the defendant Manley Holdings, Inc., payable by the plaintiff.

The plaintiff is the former owner of commercial real property located at One Old Country Road in Carle Place (hereinafter the property). It alleges that, as a result of metal manufacturing operations on a neighboring parcel of real property located at 40 Voice Road, pollutants migrated onto the property. In July 2004 certain defendants, including CAWSL Enterprises, Inc. (hereinafter CAWSL), entered into a voluntary cleanup agreement with the New York State Department of Environmental Conservation and the New York State Department of Health. In July 2007 the plaintiff entered into a contract to sell the property for the sum of $71.25 million. However, when environmental testing conducted on July 24, 2007, and August 4, 2007, revealed pollutants on the property above a certain threshold established by the contract of sale, the prospective buyer, on September 4, 2007, canceled the contract, and the plaintiff refunded the $3 million deposit to the prospective buyer. In December 2007 the plaintiff sold the property for the sum of $65 million, or $6.25 million less than the sales price agreed to by the initial buyer. The plaintiff commenced this action, inter alia, to recover damages for the diminution in market value of the property resulting from the alleged contamination, the failure to remediate the property, and the negligence of the alleged former owners of 40 Voice Road, and made the same allegations against the current owner of 40 Voice Road, the Nassau County Industrial Development Agency (hereinafter NCIDA).

"A motion pursuant to CPLR 3211(a)(1) to dismiss the complaint on the ground that the action is barred by documentary evidence may be granted only where the documentary evidence utterly refutes the plaintiff's factual allegations, thereby conclusively establishing a defense as a matter of law" ( Mendelovitz v. Cohen, 37 A.D.3d 670, 670, 830 N.Y.S.2d 577; see Goshen v. Mutual Life Ins. Co. of N.Y., 98 N.Y.2d 314, 326, 746 N.Y.S.2d 858, 774 N.E.2d 1190; Fontanetta v. John Doe 1, 73 A.D.3d 78, 83, 898 N.Y.S.2d 569). "On a motion to dismiss the complaint pursuant to CPLR 3211(a)(7) for failure to state a cause of action, the court must afford the pleading a liberal construction, accept all facts as alleged in the pleading to be true, accord the plaintiff the benefit of every possible inference, and determine only whether the facts as alleged fit within any cognizable legal theory" ( Breytman v. Olinville Realty, LLC, 54 A.D.3d 703, 703-704, 864 N.Y.S.2d 70; see Leon v. Martinez, 84 N.Y.2d 83, 87, 614 N.Y.S.2d 972, 638 N.E.2d 511).

The Supreme Court properly granted those branches of the motion of the defendant Manley Holdings, Inc. (hereinafter Manley), which were to dismiss the first, second, third, fourth, and fifth causes of action insofar as asserted against it for failure to state a cause of action and based on the documentary evidence. The damages for diminution in market value, resulting from alleged contamination, the failure to remediate, and negligence, which form the basis of the complaint, occurred and were discovered prior to August 8, 2007, the date when Manley acquired 40 Voice Road. Consequently, Manley could not have caused or contributed to the damages for which the plaintiff seeks to recover in the complaint ( see Goshen v. Mutual Life Ins. Co. of N.Y., 98 N.Y.2d at 326, 746 N.Y.S.2d 858, 774 N.E.2d 1190; Leon v. Martinez, 84 N.Y.2d at 87, 614 N.Y.S.2d 972, 638 N.E.2d 511; see also Cotton v. Beames, 74 A.D.3d 1620, 1622, 905 N.Y.S.2d 295). NCIDA, which joined in Manley's motion, acquired 40 Voice Road from Manley on August 10, 2007, and, thus, is entitled to the dismissal of the first, second, third, fourth, and fifthcauses of action insofar as asserted against it for the same reason ( see Rodriguez v. County of Rockland, 43 A.D.3d 1026, 1027-1028, 842 N.Y.S.2d 488). Accordingly, the first, second, third, fourth, and fifth causes of action insofar as asserted against Manley and NCIDA were properly dismissed.

In connection with those branches of the motion of the defendants NL Ventures IV, Voice, L.P. (hereinafter Ventures LP), and NL Ventures Voice Management, LLC (hereinafter Ventures LLC), which were to dismiss the complaint insofar as asserted against them based on the documentary evidence, those defendants established that they were both formed in Texas, pursuant to Texas law. Ventures LP and Ventures LLC also established that they were both formed on April 6, 2004, and dissolved on October 24, 2007. They thus argued that, under...