SNL Leaseholder LLC v. Oakdale Rd. Holdings LLC

210 A.D.3d 1355

179 N.Y.S.3d 403

SNL LEASEHOLDER LLC, Appellant,

v.OAKDALE ROAD HOLDINGS LLC, Respondent.

535035

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

Calendar Date: October 12, 2022

Decided and Entered: November 23, 2022

David Bolton, PC, Garden City (David Bolton of counsel), for appellant.

Harris Beach PLLC, Syracuse (Julian B. Modesti of counsel), for respondent.

Before: Lynch, J.P., Aarons, Reynolds Fitzgerald, Fisher and McShan, JJ.

MEMORANDUM AND ORDER

Reynolds Fitzgerald, J. Appeal from an order of the Supreme Court (Eugene D. Faughnan, J.), entered March 4, 2022 in Broome County, which, among other things, denied plaintiff's motion for a default judgment.

In March 2020, plaintiff leased commercial property from defendant. The lease agreement required defendant to make certain repairs and renovations to the property. Under the terms of the agreement, plaintiff was obligated to remit periodic payments for the renovations and rent would be abated until defendant substantially completed the work and obtained a certificate of occupancy. If defendant delayed or failed to complete the renovations, plaintiff could terminate the lease. In October 2020, the parties executed an amendment of the lease extending defendant's time to substantially complete the renovations and obtain a certificate of occupancy until December 31, 2020.

On July 3, 2021, plaintiff notified defendant that it was exercising its right to terminate the lease. On the same day, plaintiff commenced an action in Supreme Court, Nassau County seeking a declaratory judgment and a money judgment, based on defendant's breach of the lease for failure to substantially complete the repairs and renovations in a timely manner. Defendant immediately filed a demand for change of venue and, within a week, moved to change venue. While the motion was pending, defendant sought from plaintiff an extension to serve an answer. Plaintiff agreed to extend defendant's time to answer until August 27, 2021. In the meantime, defendant retained new counsel in the matter, and said counsel filed a consent to change attorney on August 25, 2021. On September 3, 2021, defendant's new counsel requested a second extension to serve an answer until September 30, 2021, which plaintiff denied. Thereafter, defendant contacted Supreme Court, Nassau County seeking an extension. A September 15, 2021 order of Supreme Court, Nassau County (Driscoll, J.) transferred the matter to Broome County, but failed to address defendant's request for an extension. Defendant served an answer on September 27, 2021, which plaintiff rejected as untimely. Plaintiff subsequently moved for default judgment, and defendant cross-moved for, among other things, an order compelling plaintiff to accept the answer. Supreme Court, Broome County (Faughnan, J.) denied plaintiff's motion and granted defendant's cross motion, prompting this appeal by plaintiff.

Plaintiff contends that Supreme Court erred in denying its motion for default judgment and in compelling it to accept defendant's answer. We disagree. A court may compel the acceptance of an answer untimely served upon such terms as may be just and upon a showing of a reasonable excuse for the delay or default (see CPLR 3012[d] ). "Whether a reasonable excuse exists is a determination to be made based on various factors, including the extent of the delay, the prejudice to the opposing party, whether there has been any willfulness and whether ... the untimely answer sets forth a meritorious defense" ( Walker v. GlaxoSmithKline, LLC, 201 A.D.3d 1272, 1273–1274, 163 N.Y.S.3d 260 [3d Dept. 2022] [citations omitted]; see Anthony DeMarco & Sons Nursery, LLC v. Maxim Constr. Serv. Corp., 126 A.D.3d 1105, 1105, 4 N.Y.S.3d 732 [3d Dept. 2015] ).

Although defendant's proffered excuses...