TM 18 Realty, LLC v. Copper Wang, Inc.

222 A.D.3d 904

202 N.Y.S.3d 267

TM 18 REALTY, LLC, et al., respondents,

v.COPPER WANG, INC., et al., appellants.

2022–02874

Index No. 712653/16

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

Submitted—June 23, 2023

December 20, 2023

Thomas J. Hillgardner, Jamaica, NY, for appellants.

Joseph H. Neiman, Jamaica Estates, NY, for respondents.

ANGELA G. IANNACCI, J.P., PAUL WOOTEN, HELEN VOUTSINAS, LILLIAN WAN, JJ.

DECISION & ORDER

In an action, inter alia, to recover damages for breach of contract, the defendants appeal from an order of the Supreme Court, Queens County (Carmen R. Velasquez, J.), entered March 15, 2022. The order, insofar as appealed from, denied those branches of the defendants’ motion which were for summary judgment dismissing the first and second causes of action and on their first counterclaim.

ORDERED that the order is modified, on the law, by deleting the provision thereof denying that branch of the defendants’ motion which was for summary judgment dismissing the second cause of action, and substituting therefor a provision granting that branch of the motion; as so modified, the order is affirmed insofar as appealed from, without costs or disbursements.

In May 2015, the plaintiffs, as landlords, and the defendant Copper Wang, Inc. (hereinafter CWI), as tenant, entered into a commercial lease that was personally guaranteed by the defendant Ruan Min Ying, under which CWI leased real property owned by the plaintiffs for the express and limited purpose of operating a scrap metal business on the premises. In April 2016, CWI served upon the plaintiffs a notice to cure, and thereafter a letter purporting to terminate the lease, on the basis that the plaintiffs had failed to deliver real property that could be used for the operation of a scrap metal business as provided for in the lease. According to the defendants, the certificate of occupancy did not allow such use, and in order to use the property as contemplated, they would need a temporary certificate of occupancy, an amended certificate of occupancy, or a "letter of no objection" from the New York City Department of Buildings, none of which had been obtained.

The plaintiffs thereafter commenced this action to recover unpaid rent and related charges, alleging in the first cause of action a breach of contract and in the second cause of action the existence of an account stated. The defendants interposed, inter alia, a first counterclaim seeking a judgment declaring that the lease was void for illegality as well as counterclaims seeking rescission of the lease. After the completion of discovery, the defendants moved, among other things, for summary judgment dismissing the first and second causes of action and on their first counterclaim. In an order entered March 15, 2022, the Supreme Court, inter alia, denied those branches of the defendants’ motion. The defendants appeal.

The Supreme Court properly denied those branches of the defendants’ motion which were for summary judgment dismissing the first cause of action and on their first counterclaim. The defendants failed to eliminate triable issues of fact as to whether the lease was void for illegality and whether their obligation to pay rent and other charges was thereby abrogated (see 56–70 58th St. Holding Corp. v. Fedders–Quigan Corp., 5 N.Y.2d 557, 561, 186 N.Y.S.2d 583, 159 N.E.2d 150 ; Jack Kelly Partners LLC v. Zegelstein, 140 A.D.3d 79, 85, 33 N.Y.S.3d 7 ; Kosher Konvenience, Inc. v....