W. Fin. Reit v. 150-152 E. 79, LLC

• Decision Date: 26 April 2022
• Docket Number: Index No. 850128/2021,Motion Seq. No. 1
• Citation: 2022 NY Slip Op 31428 (U)
• Parties: W FINANCIAL REIT, LTD, Plaintiff, v. 150-152 EAST 79 LLC, ZIEL FELDMAN, LANGAN ENGINEERING, ENVIRONMENTAL, SURVEYING, LANDSCAPE ARCHITECTURE & GEOLOGY, D.P.C..TETRA ENGINEERS ARCHITECTS & LANDSCAPE ARCHITECTS, P.C., NEW YORK STATE DEPARTMENT OF TAXATION AND FINANCE, NEW YORK CITY DEPARTMENT OF FINANCE, JOHN DOE NO. 1 TO JOHN DOE NO. 30, INCLUSIVE, THE LAST THIRTY NAMES BEING FICTITIOUS AND UNKNOWN TO PLAINTIFF, THE PERSONS OR PARTIES INTENDED BEING THE TENANTS, OCCUPANTS, PERSONS OR CORPORATIONS, Defendant.
• Court: New York Supreme Court

2022 NY Slip Op 31428(U)

W FINANCIAL REIT, LTD, Plaintiff,
v.
150-152 EAST 79 LLC, ZIEL FELDMAN, LANGAN ENGINEERING, ENVIRONMENTAL, SURVEYING, LANDSCAPE ARCHITECTURE & GEOLOGY, D.P.C..TETRA ENGINEERS ARCHITECTS & LANDSCAPE ARCHITECTS, P.C., NEW YORK STATE DEPARTMENT OF TAXATION AND FINANCE, NEW YORK CITY DEPARTMENT OF FINANCE, JOHN DOE NO. 1 TO JOHN DOE NO. 30, INCLUSIVE, THE LAST THIRTY NAMES BEING FICTITIOUS AND UNKNOWN TO PLAINTIFF, THE PERSONS OR PARTIES INTENDED BEING THE TENANTS, OCCUPANTS, PERSONS OR CORPORATIONS, Defendant.

Index No. 850128/2021, Motion Seq. No. 1

Supreme Court, New York County

April 26, 2022

Unpublished Opinion

DECISION + ORDER ON MOTION

HON. FRANCIS KAHN, III, J.S.C.

The following e-filed documents, listed by NYSCEF document number (Motion 001) 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49 were read on this motion to/for JUDGMENT - SUMMARY.

Upon the foregoing documents, the motion is determined as follows:

This is an action to foreclose on a mortgage encumbering five parcels of commercial real property located at 150 East 79th Street, 152 East 79th Street, 154 East 79th Street, 1131 Lexington Avenue and 1135 Lexington Avenue. The mortgage was given to secure a loan made by Plaintiff to Defendant 150-152 East 79th LLC ("150-152 East") in the original amount of $43, 600, 000.00 and is memorialized by a consolidated, amended and restated mortgage note, dated February 28, 2020. The note is executed on behalf of 150-152 East by Defendant Ziel Feldman ("Feldman"). Concomitantly with the note and mortgage, Feldman executed an unconditional personal guaranty of the loan.

Plaintiff commenced this action and pled four causes of action, including to foreclose on the subject mortgage. Defendant Langan Engineering, Environmental, Surveying, Landscape Architecture & Geology, D.P.C. ("Langan"), a holder of a mechanic's lien on certain of the mortgaged premises, answered and pled four affirmative defenses, including lien superiority, as well as a counterclaim and three crossclaims. Defendants 150-152 East and Feldman answered both the complaint and crossclaims and pled twenty-one affirmative defenses, including lack of standing.

Now, Plaintiff moves for summary judgment against Defendants 150-152 East, Feldman, and

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Langan, to appoint a Referee to compute, to amend the caption, to dismiss Defendant Langan's counterclaim and for severance of Defendant Langan's crossclaims, or in the alternative, severing the counterclaim and crossclaims. Only Defendants 150-152 East and Feldman opposes the motion.

In moving for summary judgment, Plaintiff was required to establish prima facie entitlement to judgment as a matter of law though proof of the mortgage, the note, and evidence of West 134 and Feldheim's default in repayment (see U.S. Bank, N.A., v James, 180 A.D.3d 594 [1^st Dept 2020]; Bank of NY v Knowles, 151 A.D.3d 596 [1^st Dept 2017]; Fortress Credit Corp. v Hudson Yards, LLC, 78 A.D.3d 577 [1^st Dept 2010]). Proof supporting a prima facie case on a motion for summary judgment must be in admissible form (see CPLR §3212[b]; Tri-State Loan Acquisitions III, LLC v Litkowski, 172 A.D.3d 780 [1^st Dept 2019]). As Defendants 150-152 East and Feldman raised lack of standing as an affirmative defense in their answer, Plaintiff was required to demonstrate it had standing to prosecute the action when it was commenced (see e.g. Wells Fargo Bank, N.A. v Tricario, 180 A.D.3d 848 [2^nd Dept 2020]).

Plaintiffs motion was supported with an affidavit from David Heiden ("Heiden"), Co-President of Plaintiff. Heiden's affidavit, which was sufficiently supported by admissible business records, established the mortgage, note, and evidence of mortgagor's default (see e.g. Bank of NY v Knowles, supra; Fortress Credit Corp. v Hudson Yards, LLC, supra). As to standing, Heiden established that Plaintiff was the original lender and, therefore, in direct privity with the Defendants (see generally Wilmington Sav. Fund Socy., FSB v Matamoro, 200 A.D.3d 79, 90-91 [2d Dept 2021]).

In opposition, Defendantsl50-152 East and Feldman proffered no argument against Plaintiffs prima facie case for foreclosure nor posited that an issue of fact exists on the substantive elements of that claim. Instead, Defendants argued that the motion is premature, was not served on a necessary party and that discovery is necessary to oppose the motion.

Defendants' assertion that Plaintiffs failure to join First Republic Bank ("First Republic"), a tenant at one of the mortgaged premises and necessary party under RPAPL § 1311, precludes summary judgment as it is without merit. Although First Republic may be a "tenant in fee" and, therefore, a necessary party under RPAPL § 1311 [1 ], it is not an indispensable party and failure to join it herein renders its interest unaffected by the judgment (see Polish Nat. Alliance of Brooklyn, USA v White Eagle Hall Co., Inc., 98 A.D.2d 400, 406 [2d Dept 1983]; see also 517-525 W. 45 LLC v. Avrahami, 202 A.D.3d 611, 612 [1^st Dept 2022]). Indeed, even if First Republic is a lease holding party, it may not be dispossessed by a purchaser at a foreclosure sale without further proceedings (see 6820 Ridge Realty LLC v Goldman, 263 A.D.2d 22, 26 [2d Dept 1999]; 1426 46 St., LLC v Klein, 60 A.D.3d 740 [2d Dept 2009]). As such, "[s]ummary judgment [is] not precluded by non joinder of [First Republic], who [was a] necessary part[y] only in the sense that their subordinate interests could be adversely affected only if they were joined, and not in the sense of being indispensable" (John Hancock Mut. Life Ins. Co. v 491-499 Seventh Ave. Assocs., 220 A.D.2d 208 [1 st Dept 1995]). In any event, Plaintiff filed an affidavit of service which, on its face, demonstrates First Republic was served in the capacity of a John Doe defendant and defaulted in appearing, (see eg 21st Mtge. Corp. v Raghu, 197 A.D.3d 1212, 1217 [2d Dept 2021] [A defaulting party is "not entitled to service of additional papers in the action"]).

As to the branch of Plaintiff s motion to dismiss all Defendants' affirmative defenses, CPLR §3211 [b] provides that "[a] party may move for judgment dismissing one or more defenses, on the ground that a defense is not stated or has no merit". For example, affirmative defenses that are without factual foundation, conclusory or duplicative cannot stand (see Countrywide Home Loans Servicing, L.P. v Vorobyov, 188 A.D.3d 803, 805 [2d Dept 2020]; Emigrant Bank v Myers, 147 A.D.3d 1027, 1028 [2d Dept 2017]).

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When evaluating such a motion, a "defendant is...