New York Supreme Court Appellate Division—First Department
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To be Argued by: TRACY PETERSON New York County Clerk’s Index No. 157316/14 New York Supreme Court Appellate Division—First Department J. ARMAND MUSEY, Plaintiff-Appellant, – against – 425 EAST 86 APARTMENTS CORP., DOUGLAS ELLIMAN PROPERTY MANAGEMENT, FRANK CHANEY, PATRICIA CARBON, DAVID MUNVES, MICHAEL CONSIDINE, SUZANNE KEANE a/k/a Suzanne Julig, JENNIFER KRUEGER, GEORGE GREENBERG, ALEXANDER SHAPIRO and LESLIE SPITALNICK, Defendants-Respondents. BRIEF FOR DEFENDANTS-RESPONDENTS 425 EAST 86 APARTMENTS CORP., DOUGLAS ELLIMAN PROPERTY MANAGEMENT, FRANK CHANEY, PATRICIA CARBON, DAVID MUNVES, MICHAEL CONSIDINE, SUZANNE KEANE A/K/A SUZANNE JULIG, JENNIFER KRUEGER, ALEXANDER SHAPIRO AND LESLIE SPITALNICK BRAVERMAN GREENSPUN, P.C. Attorneys for Defendants-Respondents 425 East 86 Apartments Corp., Douglas Elliman Property Management, Frank Chaney, Patricia Carbon, David Munves, Michael Considine, Suzanne Keane a/k/a Suzanne Julig, Jennifer Krueger, Alexander Shapiro and Leslie Spitalnick 110 East 42nd Street, 17th Floor New York, New York 10017 (212) 682-2900 [email protected] PRINTED ON RECYCLED PAPER TABLE OF CONTENTS TABLE OF AUTHORITIES ......................................................................... iv Preliminary Statement ..................................................................................... 1 Questions Presented ........................................................................................ 4 Counter-Statement of the Case ....................................................................... 6 A. Factual Background ...................................................................... 6 i. The Parties ............................................................................... 6 ii. The “Terrace” .......................................................................... 7 iii. The Roof Rules ........................................................................ 9 B. Procedural Background ............................................................... 13 ARGUMENT ................................................................................................ 16 POINT I - THE LOWER COURT CORRECTLY DISMISSED APPELLANT’S CHALLENGE TO THE ROOF RULES AS BEING TIME-BARRED ..................................... 16 A. Appellant’s Challenge to the Roof Rules Was Subject to the Four-Month Statute of Limitations Applicable to Article 78 Proceedings .............................................................. 16 B. Appellant’s Claims Accrued Well Over Fourth Months Prior to the Commencement of This Lawsuit ............................... 19 i. Appellant Admitted That His Claim Accrued on July 27, 2013, Nearly a Year Prior to Commencement of this Action .............................................. 19 {00548421;1} i ii. Appellant’s Complaints About the Roof Rules Did Not Toll the Running of the Four-Month Statute of Limitations ............................................................ 20 C. Equitable Estoppel Does Not Apply to Toll the Applicable Statute of Limitations .................................... 25 POINT II - APPELLANT’S FURTHER ARGUMENTS OPPOSING THE STATUTE OF LIMITATIONS BAR ARE IMPROPERLY RAISED FOR THE FIRST TIME ON APPEAL AND IN ANY EVENT, ARE MISPLACED AND UNAVAILING ............... 28 A. Appellant’s Arguments Are Improperly Raised for the First Time on Appeal ............................................. 29 B. There is No Dispute Concerning Exclusive Use ........................... 30 C. Appellant’s Newly-Raised Arguments Are Meritless ................... 30 POINT III - PLAINTIFF’S RELIANCE ON THE SHAPIRO DECISION IS MISPLACED ................................. 34 POINT IV - APPELLANT’S CLAIMS COULD HAVE BEEN DISMISSED ON MYRIAD ALTERNATIVE GROUNDS .................................................. 36 A. The Allegations Are Insufficient to State Claims for Breach of Fiduciary Duty or Fraud by the Individual Board Member Respondents ........................................ 37 B. Appellant’s Breach of Fiduciary Duty Claim is Meritless ............ 39 C. Appellant’s Fraud Claim is Meritless ............................................ 43 D. Appellant Is Not Entitled to the Declaratory Relief Sought ......... 47 E. Appellant’s Breach of Contract Claim is Without Merit .............. 52 {00548421;1} ii POINT V - LEAVE TO AMEND THE COMPLAINT WAS PROPERLY DENIED .................................................... 56 POINT VI - THE MOTION TO QUASH WAS PROPERLY GRANTED ......................................................... 61 CONCLUSION ............................................................................................. 66 {00548421;1} iii TABLE OF AUTHORITIES Cases 82 Retail LLC v. Eighty Two Condominium, 117 A.D.3d 587 (1st Dep’t 2014) ........................................................ 38 198 Avenue B Associates v. Bee Corp., 155 A.D.2d 273 (1st Dep’t 1989) ........................................................ 46 252 West 30th Street Realty Corp. v. Biderman, 165 A.D.2d 759 (1st Dep’t 1990) ........................................................ 24 767 Third Ave. LLC v. Greble & Finger, LLP, 8 A.D.3d 75 (1st Dep’t 2004) .............................................................. 53 Allen v. Murray House Owners Corp., 174 A.D.2d 400 (1st Dep’t 1991) ........................................................ 43 Atlantic Aviation Investment LLC v. Varig Logistica, S.A., 73 A.D.3d 467 (1st Dep’t 2010) .......................................................... 29 Barrett v. Freifeld, 64 A.D.3d 736 (2d Dep’t 2009) .......................................................... 45 Bonar v. Shaffer, 140 A.D.2d 153 (1st Dep’t 1988) ........................................................ 24 Buttitta v. Greenwich House Cooperative Apts., Inc., 11 A.D.3d 250 (1st Dep’t 2004) .......................................................... 17 Chanin v. Machcinski, 139 A.D.3d 490 (1st Dep’t 2016) ........................................................ 36 {00548421;1} iv Chiarella v. United States, 445 U.S. 222 (1980)............................................................................ 45 Citi Mgmt. Group, Ltd. v. Highbridge House Ogden, LLC, 21 Misc.3d 1123(A) (N.Y. Sup. Ct. Bronx Co. 2005) ....................... 45 Close-Barzin v. Christie’s, Inc., 51 A.D.3d 444 (1st Dep’t 2008) ..................................................... 26-27 Crucen v. Leary, 55 A.D.3d 510 (1st Dep’t 2008) .......................................................... 56 Cusack v. Greenberg Traurig, LLP, 109 A.D.3d 747 (1st Dep’t 2013) ........................................................ 56 D’Alessandro v. Carro, 123 A.D.3d 1 (1st Dep’t 2014) ............................................................ 15 Dembeck v. 220 Central Park South, 33 A.D.3d 491 (1st Dep’t 2006) .......................................................... 45 Dobbins v. Riverview Equities Corp., 64 A.D.3d 404 (1st Dep’t 2009) .......................................................... 17 Dweck v. Oppenheimer & Co., 30 A.D.3d 163 (1st Dep’t 2006) .......................................................... 59 FNF Touring LLC v. Transform America Corp., 111 A.D.3d 401 (1st Dep’t 2013) ................................................... 44-45 Goonewardena v. Hunter College, 40 A.D.3d 443 (1st Dep’t 2007) ..................................................... 23-24 Gordon v. Nationwide Mut. Ins. Co., 30 N.Y.2d 427 (1972) .................................................................... 42-43 Haron v. Azoulay, 132 A.D.3d 475 (1st Dep’t 2015) ........................................................ 63 {00548421;1} v Herriott v. 206 West 121st Street, 2017 WL 446901 (N.Y. Sup. Ct. N.Y. Co., Feb. 2, 2017) ................ 17 Hixon v. 12-14 East 64th Owners Corp., 107 A.D.3d 546 (1st Dep’t 2013) ........................................................ 38 In re Morgenthau, 73 A.D.3d 415 (1st Dep’t 2010) .......................................................... 65 Jackson v. Westminster House Owners Inc., 2004 WL 5487453 (N.Y. Sup. Ct., N.Y. Co. Apr. 8, 2004) ............... 55 Jana L. v. West 129th Street Realty Corp., 22 A.D.3d 274 (1st Dep’t 2005) .......................................................... 46 Kainer v. Christie’s Inc., 141 A.D.3d 442 (1st Dep’t 2016) ........................................................ 25 Kalisch-Jarcho, Inc. v. New York, 72 N.Y.2d 727 (1988) ......................................................................... 59 Kan v. New York City Envir. Control Bd., 262 A.D.2d 135 (1st Dep’t 1999) .................................................. 18, 24 Katz v. Third Colony Corp., 101 A.D.3d 652 (1st Dep’t 2012) ................................................... 16-17 Kitchen v. Crotona Park West Housing Dev. Fund. Corp., 145 A.D.3d 521 (1st Dep’t 2016) ........................................................ 15 Lemle v. Lemle, 92 A.D.3d 494 (1st Dep’t 2012) .......................................................... 58 Levandusky v. One Fifth Ave. Apt. Corp., 75 N.Y.2d 530 (1990) .............................................................. 40-41, 50 Lichtenstein v. Wilkie Farr & Gallagher LLP, 120 A.D.3d 1095 (1st Dep’t 2014) ...................................................... 41 {00548421;1} vi Maio v. New York City Civil Serv. Comm’n, 176 A.D.2d 526 (1st Dep’t 1991) ........................................................ 24 Meimeteas v. Carter Ledyard & Milbrun LLP, 105 A.D.3d 643 (1st Dep’t 2013) ........................................................ 56 Menkes v. Beth Abraham Servs.,