Board of Mgrs. of the 125 N. 10th Condominium v 125 N. 10, LLC |
2014 NY Slip Op 50035(U) [42 Misc 3d 1214(A)] |
Decided on January 6, 2014 |
Supreme Court, Kings County |
Demarest, J. |
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. |
This opinion is uncorrected and will not be published in the printed Official Reports. |
Board of
Managers of the 125 North 10th Condominium, Plaintiff,
against 125 North 10, LLC d/b/a 125 North 10 LLC, 125N 10 d/b/a 125 North10 LLC 125 N 10 d/b/a 125 North10 MM, LLC, Savanna Services L.L.C. d/b/a Savanna Partners d/b/a Savanna Fund, Christopher Schlank, Nicholas Bienstock a/k/a Nicholas C. Bienstock a/k/a Nicholas Cburnham Bienstock, Peter Petron, John Fraser a/k/a John R. Fraser, Investcorp International Holdings Inc. d/b/a Investcorp, Ryder Construction, Inc., Carl Jaccarino, Robert M. Reich, LLC, Robert M. Reich, Anthony Cucich Architects d/b/a A. Cucich Architects, Anthony Cucich a/k/a Anthony A. Cucich, Scarano Architect, PLLC, d/b/a Scarano & Associates Architects, Robert M. Scarano, Jr. a/k/a Robert Scarano, AE Design Incorporated d/b/a Andres Escobar & Associates, Sharon Engineering P.C., Ronan Sharon, Penmark Realty Corporation. d/b/a Penmark Realty Corp., d/b/a Penmark, Core Group Marketing LLC d/b/a Core Group Marketing, LLC, S. Schwartz Engineering, PLLC d/b/a Schwartz S d/b/a S. Schwartz Associates Consulting Engineers, Simon Schwartz, Frank Seta & Associates, LLC, Saied S. Seta a/k/a Frank Seta, "John Doe #1 through John Doe No.10," inclusive, the last ten names being fictitious and unknown to Plaintiff, the persons or parties intended being the persons or corporations or entities who provided constructions services and/or design and fabrication services at the Premises described herein, Defendants. |
The following papers read on this motion:Papers Numbered:
Penmark's Notice of Motion, Memo of Law in Support, Affs in Support;
Plaintiff's Memo of Law in Opposition; Affirmation in Opp;
Penmark's Memo of Law in Reply
1-7
Scarano's Notice of Motion, Memo of Law in Support;
[*2]
Plaintiff's Memo of Law in Opposition;
Affirmation in Opp;
Scarano's Memo of Law in Reply
8-12
Cucich's Notice of Motion, Memo of Law in Support;
Plaintiff's Memo of Law in Opposition; Affirmation in Opp
13-16
Seta's Notice of Motion, Memo of Law in Support;
Plaintiff's Memo of Law in Opposition; Affirmation in Opp;
Seta's Aff and Memo of Law in Reply
17-22
Schwartz's Notice of Motion, Memo of Law in Support;
Plaintiff's Memo of Law in Opposition; Affirmation in Opp;
Schwartz's Aff in Reply
23-27
Jaccarino's Notice of Motion, Memo of Law in Support;
Plaintiff's Memo of Law in Opposition; Affirmation in Opp;
Jaccarino's Aff in Reply
28-32
Sharon's Notice of Motion, Exhibit 3, Memo of Law in Support;
Plaintiff's Memo of Law in Opposition; Affirmation in Opp;
Ryder/Jaccarino Affidavit in Opp
33-37, 45
AE Design's Notice of Motion;
Plaintiff's Memo of Law in Opposition; Affirmation in Opp
38-40
Sponsors' Affs and Memo of Law in Opp to Motions to Dismiss
Cross-claims; Documentary Supplement
[*3]
41-44
Strict Liability - Fifth Cause of Action
Plaintiff's fifth cause of action is for strict liability against Sponsors,
Cucich defendants, Scarano defendants, Penmark, Core, Ryder, Jaccarino, Seta
defendants, and Reich defendants. Plaintiff complains that the Building fails to comply
with various NYC building codes, including fire, ADA accessibility, electric, and
exhaust, which present a hazard to health and safety to Building occupants.
Fraud - Sixth Cause of Action
Plaintiff claims in its sixth cause of action, for fraud, that the Offering
Plan, marketing materials, and Sponsor Certification misrepresented the quality of the
Building yet Sponsors disseminated these documents, and verbally ratified the
representations in them, to prospective purchasers to induce them into purchasing
residential units. Although plaintiff asserts this cause of action against, in addition to
Sponsor defendants, Penmark, Core, and the Reich defendants, plaintiff does not plead
any actions taken by those defendants and only generally states that "[d]efendants have
actively misrepresented and concealed the conditions at the Building."
Professional Malpractice - Seventh Cause of Action
Plaintiff's seventh cause of action asserts claims for professional
malpractice against Cucich defendants, Scarano Defendants, AE Design, Sharon
Defendants, Schwartz Defendants, and Seta Defendants, alleging that they breached
duties of care owed to unit owners to ensure that the Building was designed and
constructed in accordance with the Plans and Specifications and in accordance with
normal industry standards, resulting in a Building with dangerous conditions that will
"invariably result in claims for damages and/or injuries."
Negligent Misrepresentation - Eighth Cause of Action
In its eighth cause of action, plaintiff claims that Cucich, Scarano, AE
Design, Sharon, Scwartz, and Seta Defendants made representations and drew up plans
and specifications to be used in the Offering Plan, yet failed to disclose the deficiencies
in construction, which was " a gross departure from good and accepted practice."
Deceptive Trade Practices Under GLB § 349 - Ninth Cause
of Action
Plaintiff's ninth cause of action asserts claims for deceptive trade
practices under GBL § [*6]349, alleging that
Sponsors disseminated the Offering Plan to prospective purchasers that contained
misrepresentations about the quality of the Building, did not correct the
misrepresentations, but instead verbally ratified them to induce purchasers. Although
defendants Penmark, Core, and Reich Defendants are named in the caption, plaintiff's
allegations describe no actions taken by them.
False Advertising Under GBL § 350- Tenth Cause of
Action
Finally, plaintiff asserts claims for false advertising within the meaning
of GBL § 350, claiming that Sponsors' omissions and statements in various
marketing materials constitute false advertising. Although defendants Penmark, Core,
and Reich Defendants are named in the caption, plaintiff's allegations describe no actions
taken by them.
A number of defendants have moved to dismiss the complaint and various
cross-claims [FN3]
against them. The following defendants move to dismiss pursuant to CPLR 3211(a)(1) or
(a)(7): Penmark, Scarano, Seta, and Ryder. Defendants Cucich and AE Design move to
dismiss pursuant to CLR 3212. Although Schwartz and the Sharon defendants
characterize their motions as brought pursuant to 3211, the Court notes that they have
answered and issue is joined, so the motions are regarded as brought under CPLR 3212.
At oral argument on June 12, 2013, the defendants adopted the arguments made by all
other defendants. Their motions will be addressed in turn.
Upon motion for summary judgment, pursuant to CPLR 3212, the moving party
bears the initial burden to produce affidavits and documentary evidence sufficient to
"warrant the court as a matter of law in directing judgment in [its] favor" (CPLR
3212(b); see Friend of Animals, Inc. v Assoc. Fur Mfrs., Inc., 46 NY2d 1065,
1078 [1979]). Once the movant establishes prima facie entitlement to judgment, the
burden shifts to the opposing parties to "demonstrate by admissible [*7]evidence the existence of a factual issue requiring a trial of
the action" (Zuckerman v City of New York, 49 NY2d 557, 560 [1980]). While
"all facts must be viewed in the light most favorable to the non-moving party"' (Vega v Restani Constr. Corp.,
18 NY3d 499, 503 [2012],
quoting Ortiz v Varsity Holdings, LLC, 18 NY3d 335, 339 [2011]), mere
conclusory allegations or defense are insufficient to preclude summary judgment (see
Zuckerman, 49 NY2d at 562).
Paragraph (g) of the Offering Plan reads, in part:
At the First Closing, Sponsor will deliver, assign or otherwise grant to the
Condominium board, on behalf of all Unit Owners, the right to proceed under any
assignable warranties and other undertakings received by Sponsor from contractors,
suppliers, or others in connection with the construction and equipping of the Building . . .
Paragraph (p) of the Plan further references the assignment of warranties, in
stating:
Except for those warranties or guarantees provided to Sponsor by
contractors, manufacturers or suppliers, which Sponsor will assign to the Condominium
Board and/or Unit Owners, as necessary, Sponsor does not make any warranty of any
kind, express or implied . . . In Kikirov, this Court declined to dismiss claims for
breach of contract against the general contractors of a project because a provision in the
Offering Plan stated that the sponsor "will deliver . . . on behalf of Unit Owners an
assignment of all assignable warranties and other undertakings received by the Sponsor
from contractors, materialmen or others in connection with the construction and
equipping of the Building" (Kikirov, at *11). Although the plaintiff had not
explicitly alleged that such assignments had occurred, this Court determined that further
discovery was required to determine whether any such assignments existed.
While the language in the Offering Plan is similar to the provision in
Kikirov, the documentary evidence precludes a finding that Scarano and
Sponsors intended to benefit plaintiff. Sponsors, in opposition to Scarano's motion to
dismiss all cross-claims against it, submits a complete copy of its agreement with
Scarano. At section 1.3.7.5, the agreement [*11]expressly
states that "[n]othing contained in this Agreement shall create a contractual relationship
with or a cause of action in favor of a third party against either the Owner or Architect."
Thus, the documentary evidence conclusively shows that plaintiff was not an intended
third party beneficiary, as the contract explicitly states that the parties did not intend to
create a benefit for third parties (see Edward B. Fitzpatrick, Jr. Contr. Corp. v County
of Suffolk, 138 AD2d 446, 450 [2d Dept 1988])("Where a provision in the contract
expressly negates enforcement by third parties, that provision is controlling.").
Accordingly, plaintiff's first cause of action against Scarano is dismissed.
Breach of Express Warranty
Plaintiff brings a separate cause of action for breach of express warranty,
alleging that Scarano and all other defendants expressly warranted that "the quality of
their services and/or work would be first-class and performed in a professional manner
consistent with the local prevailing standards of architecture . . . and would be in
compliance with the Plans and Specifications and applicable Building Codes of the City
of New York . . . and their services would be free of deficiencies and defects." Plaintiffs
claim that these warranties were extended to the Sponsor and then assigned to plaintiff,
the intended beneficiary of the warranties.
It is well established that "[n]o warranty attaches to the performance of a
service. If the service is performed negligently, the cause of action accruing is for that of
negligence. Likewise, if it constitutes a breach of contract, the action is for that breach"
(Town of Poughkeepsie v
Espie, 41 AD3d 701, 706 [2d Dept 2007] citing Aegis Prods. v Arriflex
Corp. of Am., 25 AD2d 639, 639 [3d Dept 1966] see also Milau Assoc. v North
Ave. Dev. Corp., 42 NY2d 482, 488 [1977]; Mallards Dairy, LLC v E & M
Engineers & Surveyors, P.C., 71 AD3d 1415, 1417 [4th Dept 2010] (because
contract was for services, cause of action for breach of warranty could not lie). Here, the
warranty plaintiff claims was breached is a contractual promise to perform services in a
certain manner, which forms the basis for plaintiff's first cause of action for breach of
contract. Accordingly, plaintiff's second cause of action is dismissed as to Scarano.
Negligence
Plaintiff also asserts a claim for negligence against all defendants.
Plaintiff claims that defendants, including Scarano, had a duty to the Building owners to
perform work consistent with local standards and in accordance with the Plans and
Specifications, which it breached when it negligently designed the Building. As a result,
plaintiff contends, it must spend large sums of money to cure the defects caused by
defendant's negligence.
The essence of plaintiff's claim is for breach of contract, not tort, as plaintiff
fails to allege that defendants breached a duty other than to build the Building in the
manner they promised (see Merritt v Hooshang Constr., 216 AD2d 542, 543 [2d
Dept 1995](allegations that builder negligently constructed house sounded in contract,
not tort). "[A] simple breach of contract is not to be considered a tort unless a legal duty
independent of the contract has been violated . . . This legal duty must spring from
circumstances extraneous to, and not constituting elements of the contract, although it
may be connected therewith and dependent upon the contract" (Board of Mgrs. of
Riverview at Coll. Point Condominium III v Schorr Brothers Development Corp.,
182 A2d 664, 666 [2d Dept 1992] citing Clarke-Fitzpatrick, Inc. v Long Is. R.R.
Co., 70 NY2d 382, 389 [1987]). No independent legal duty to plaintiff has been
alleged.
Moreover, the harm plaintiff complains of —the cost of
repair— is economic loss, for which there is no recovery in negligence (see
Key Intl. Mfg. v Morse/Diesel, Inc., 142 AD2d 448, [*12]450-52 [2d Dept 1988] (Supreme Court properly
dismissed construction project owner's claim for economic loss caused by negligence of
an architect or engineer with whom it was not in privity of contract); Lake Placid
Club Attached Lodges v Elizabethtown Bldrs., 131 AD2d 159, 162 [3d Dept 1987]).
As the complaint fails to state a cause of action for negligence, plaintiff's
fourth cause of action is dismissed as to Scarano.
Strict Liability
Plaintiff alleges that, because the building defects have resulted in
violations of various NYC building codes, specifically Building Code § 27-334,
which is violated by the design of the terrace railings, defendants, including Scarano,
should be held strictly liable.
A cause of action for strict liability seeks to provide a remedy for an
individual injured because of another's violation of an obligation imposed, not by
contract, but by law. "It does not attempt to afford the injured party the benefit of any
bargain but rather endeavors to place him in the position he occupied prior to the injury"
(Steckmar Nat. Realty and Inv. Corp., Ltd., v J.I. Case Co., 99 Misc 2d 212, 214
[Sup Ct, NY County 1979]). The crux of plaintiff's complaint is that Scarano's plans
caused the building to be defectively constructed so as to violate various codes, requiring
plaintiff to expend large sums to rectify. Plaintiff has not alleged that it has suffered any
physical injury resulting from the alleged violations. The economic loss plaintiff
complains of is "not the character of harm contemplated by the rule which renders a
manufacturer liable for negligence or strict products liability"' (Hole v General
Motors Corp., 83 AD2d 715, 717 [3d Dept 1981] quoting Steckmar, 99 Misc
2d at 214; see also Key Intl., 142 AD2d at 450-52).
Moreover, plaintiff fails to allege that the building codes are the types of statutes that
establish a specific standard of care and that plaintiff falls within the class of people
intended to be benefited by such statutes (see Zupnick v Certified Lbr Corp., 17
Misc 3d 1122(A) [Sup Ct, Kings County 2007]). Accordingly, plaintiffs' cause of action
for strict liability against Scarano is dismissed.
Professional Malpractice
Plaintiff also asserts a cause of action for professional malpractice,
alleging that Scarano breached its duty to design the building "in a competent and
workmanlike manner in accordance with the Plans and Specifications and in accordance
with normal industry standards for construction, architecture, and engineering" (Compl.
¶ 362). In claims against professionals, "[a] legal duty independent of contractual
obligations may be imposed by law as an incident to the parties' relationship"(17
Vista Fee Assoc. v Teachers Ins. & Annuity Assn. of Am., 259 AD2d 75, 83 [1st
Dept 1999]). Here, however, the documentary evidence establishes that plaintiff had no
contractual relationship with Scarano, nor any relationship approaching privity.
Accordingly, plaintiff's malpractice claim is dismissed (see 905 5th Associates, Inc. v
Weintraub, 85 AD3d 667, 668 (1st Dept 2011])(malpractice claim dismissed
when plaintiff had not established a relationship approaching privity with architect who
provided services for neighbor's construction).
[*13]Negligent Misrepresentation
Plaintiff also asserts a claim for negligent misrepresentation against
Scarano, alleging that Scarano made representations about the quality of the construction
that it should have known were false, when it knew the representations would be
incorporated into the Offering Plan and relied upon by prospective purchasers.
"[A] private litigant may not pursue a common-law cause of action where the
claim is predicated solely on a violation of the Martin Act or its implementing
regulations and would not exist but for the statute" (Assured Guar. (UK) Ltd. v J.P.
Morgan Inv. Mgt. Inc.,18 NY3d 341, 353 [2011]). However, an independent
common-law claim is not preempted by the Martin Act when it is not entirely dependent
on the Martin Act for its viability (see id.; see also Caboara v Babylon Cove Dev., LLC, 82 AD3d
1141, 1142 [2d Dept 2011])(defendants not entitled to judgment as a matter of law
dismissing the complaint because they failed to establish that plaintiffs' claims rested
"entirely on alleged omissions from filings required by the Martin Act and the [AG's]
implementing regulations").
Here, plaintiff complains of omissions and misrepresentations made by
Scarano in the Offering Plan. As these documents were filed in accordance with the
Martin Act, claims of misrepresentations based upon such documents are preempted by
the Martin Act. Accordingly, plaintiff's eighth cause of action against Scarano for
negligent misrepresentation is dismissed.
The documentary evidence establishes that Cucich was not in privity with plaintiff. Despite plaintiff's argument, in opposition, that Cucich knew and intended plaintiff to benefit from its contract with Sponsors, as evidenced by the provision assigning warranties in the Offering Plan, plaintiff produces no evidence in support of its position and identifies no warranties made by Cucich. As plaintiff has not submitted evidence demonstrating the existence [*14]of a factual issue requiring trial of this claim, Cucich's motion for summary judgment is granted with respect to the breach of contract claim (see Board of Mgrs. of Riverview at Coll. Point Condominium III v Schorr Brothers Development Corp., 182 Ad2d 664, 665 [2d Dept 1992])(summary judgment properly granted when plaintiff board failed to demonstrate triable issues of fact as to whether it was a third-party beneficiary of contract between project owner and contractor).[FN6]
Breach of express warranty, negligence, and strict liability
For the reasons discussed above with respect to the Scarano motion, plaintiff's claims for breach of express warranty, negligence, and strict liability are dismissed as to Cucich.
Professional Malpractice
Plaintiff cause of action for professional malpractice alleges that Cucich breached its duty of care to ensure that the Building was designed and constructed in accordance with the Plans and Specifications and normal industry standards.
"An action for professional malpractice may lie in the context of a contractual
relationship if the professional negligently discharged the duties arising from that
relationship" (17 Vista Fee Assoc. v Teachers Ins. & Annuity Assn. of Am., 259
AD2d 75, 83 [1st Dept 1999]). Here, however, the evidence establishes that plaintiff had
no contractual relationship with Cucich, nor any relationship approaching privity.
Accordingly, plaintiff's malpractice claim is dismissed (see 905 5th Associates, Inc. v
Weintraub, 85 AD3d 667, 668 (1st Dept 2011])(malpractice claim dismissed
when plaintiff had not established a relationship approaching privity with architect who
provided services for neighbor's construction).
Negligent Misrepresentation
In its complaint, plaintiff alleges that Cucich negligently misrepresented
in the architect's certification and in the various amendments to the Offering Plan that the
Building was built in accordance with the Offering Plan and in compliance with relevant
city codes. The Cucich Defendants argue that the Martin Act preempts plaintiff's claims,
as they arise solely out of the certification Cucich submitted pursuant to the Martin Act.
"[A] private litigant may not pursue a common-law cause of action where the
claim is predicated solely on a violation of the Martin Act or its implementing
regulations and would not exist but for the statute" (Assured Guar. (UK) Ltd. v J.P.
Morgan Inv. Mgt. Inc.,18 NY3d 341, 353 [2011]). However, an independent
common-law claim is not preempted by the Martin Act when it is not entirely dependent
on the Martin Act for its viability (see id.; see also Caboara v Babylon Cove Dev., LLC, 82 AD3d
1141, 1142 [2d Dept 2011])(defendants not entitled to judgment as a matter of law
dismissing the complaint because they failed to establish that plaintiffs' claims rested
"entirely on alleged omissions from filings required by the Martin Act and the [AG's]
implementing regulations").
In opposition, plaintiff argues that because the alleged misrepresentations
stemmed, not [*15]only from the certificate in the
Offering Plan, but from subsequent amendments of the Offering Plan, such claims have
an independent basis and are not preempted by the Martin Act. Plaintiff argues that the
Cucich Defendants made material misrepresentations by stating in each of the eleven
amendments to the Offering Plan that there were "no material changes," thus
misrepresenting that the Building was built in accordance with the Offering Plan.
Plaintiff's argument is unavailing. The disclosure regulations adopted by the
AG specify, at 13 NYCRR 20.5[a][2], that "[a]n amendment must include a
representation that all material changes of facts of circumstances affecting the property or
the offering are included unless the changes were described in prior amendment(s)
submitted to but not yet filed with the Department of Law." In Kerusa Co. LLC v W10Z/515
Real Estate Limited Partnership (12 NY3d 236 [2009]), a case involving similar
facts, the plaintiff's allegations that defendants did not disclose various construction and
design defects in the offering plan amendments but instead represented that there were no
material changes when there were, in fact, problems arising during construction, were
deemed preempted by the Martin Act. The Court of Appeals reasoned that "[b]ut for the
Martin Act and the [AG's] implementing regulations . . . the sponsor defendants did not
have to make the disclosures in the amendments. Thus, to accept [plaintiff's] pleading as
valid would invite a backdoor private cause of action to enforce the Martin Act . . ."
(id. at 245).
Here, plaintiff complains of omissions in the Offering Plans and subsequent
amendments. As these documents were filed in accordance with the Martin Act, claims
of misrepresentations based upon such omissions are preempted by the Martin Act and
dismissed.
In its opposition, plaintiff also raises, for the first time, allegations that
Cucich made material misrepresentations in filings with the DOB, upon which plaintiff
relied to its detriment. In support of its position, plaintiff includes an affidavit from Chad
Gessin, president of the Board, reciting the various defects with the Building and stating
that, prior to purchasing a unit in the Building, he and other resident owners researched
the Offering Plan, marketing materials, and Building Department records to decide
whether to purchase in the Building and concluding that Cucich was responsible for
filing an architect certificate and plans with the Department of Buildings.
"A claim for negligent misrepresentation requires the plaintiff to demonstrate
(1) the existence of a special or privity-like relationship imposing a duty on the defendant
to impart correct information to the plaintiff; (2) that the information was incorrect; and
(3) reasonable reliance on the information" (J.A.O. Acquisition Corp. v Stavitsky, 8 NY3d 144 [2007]).
"A relationship approaching privity requires that (1) defendant have an awareness that
his or her statement is for a particular purpose; (2) a known party relies on the statement
in furtherance of that purpose; and (3) there is some conduct linking defendant to the
relying party and evincing its understanding of that reliance" (Sykes v RFD Third Avenue 1
Associates, LLC, 67 AD3d 162, 167 [1st Dept 2009] aff'd 15 NY3d 370, 373
[2010]).
Here, plaintiff fails to support, or even allege, facts that would establish that
Cucich was aware or intended that filings with the DOB would be relied upon by
plaintiff, or that Cucich evinced an understanding of plaintiff's purported reliance.
Plaintiff's contention that plaintiff was a "known" party to Cucich because 37% of the
Building had been sold when Cucich continued to make filings with the DOB is
unavailing (see Ford v
Sivilli, 2 AD3d 773, 774 [2d Dept 2003](future purchaser of building who
brought claim of negligent misrepresentation against architect based on filings with town
building department not a known party but, rather, "[a]t best [*16]. . . part of an indeterminate class of persons who,
presently or in the future' may rely upon [the] alleged misrepresentations")(citations
omitted).
For the foregoing reasons, Cucich's motion to dismiss is granted with respect
to plaintiff's negligent misrepresentation claim.
Breach of express warranty, negligence, and strict liability
For the reasons previously discussed, plaintiff's claims for breach of
express warranty, negligence, and strict liability are dismissed as to Seta Defendants.
Professional malpractice
In the absence of allegations showing a relationship approaching privity,
plaintiff's malpractice claim is dismissed (see 905 5th Associates, Inc., 85 AD3d
at 668).
Negligent misrepresentation
For the reasons set forth in the Scarano motion discussion, plaintiff's claim
for negligent [*17]misrepresentation is dismissed as to
Seta.
On March 18, 2004, Sharon entered into an agreement with Scarano to provide structural and mechanical engineering services for the Project, whereby it was to, among other responsibilities, inspect the site and observe conditions, review architectural plans, perform structural analysis and determine the basic framing system, prepare plumbing and sprinkler plans, and assist in obtaining DOB approval. Then, on April 19, 2010, Sharon entered into an agreement with Savanna Partners, one of the Sponsors, to provide structural engineering services, including "[e]ngineering design of Structural systems for the wall repairs, temporary shoring and excavation protection." Sharon also entered into an agreement directly with plaintiff, but not until March 8, 2012, months after the alleged construction defects were discovered.
Plaintiff asserts claims for breach of contract, breach of express warranty, negligence, professional malpractice, and negligent misrepresentation against the Sharon defendants, alleging that Sharon agreed to provide services in a first-class manner, but failed to do so, which resulted in the alleged defects in the Building. Sharon Defendants move to dismiss the Complaint. Although Sharon Defendants characterize their motion as brought pursuant to 3211, the Court notes that they have answered and issue is joined, so the motion is treated as brought pursuant to CPLR 3212.
Breach of contract
Sharon argues that the breach of contract claim must be dismissed against it, as it was not in privity with plaintiff and assigned no warranties to plaintiff. In support of its motion, Sharon submits an affidavit from its president, Ronen Sharon, stating that its agreements were only with Scarano and Sponsors, respectively, and Sharon did not intend to benefit any third parties, such as plaintiff. Plaintiff claims that it was in privity with Sharon because it was an intended third party beneficiary of its agreement with Sponsors, as evidenced by the purported assignment of warranties. However, the documentary evidence, the two agreements submitted by both plaintiff and Sharon, reveals no warranties made by Sharon, and plaintiff has not identified any such warranties or produced evidence that they were assigned to it. As it fails to raise an issue of fact requiring resolution at trial, plaintiff's breach of contract claim is dismissed with respect to Sharon (see Board of Mgrs. of Riverview at Coll. Point Condominium III v Schorr Brothers Development Corp., 182 Ad2d 664, 665 [2d Dept 1992]). [*19]
Breach of express warranty & negligence
For the reasons discussed above with respect to the Scarano motion, the claims for breach of express warranty and negligence are dismissed as to Sharon.
Professional malpractice
In the absence of evidence suggesting a relationship approaching privity, plaintiff's malpractice claim is dismissed (see 905 5th Associates, Inc., 85 AD3d at 668).
Negligent misrepresentation
Plaintiff's claim that Sharon made negligent misrepresentations in the plans and
drawings it drew up to be used in the Offering Plan is dismissed for the reasons discussed
in the Scarano motion above.
On June 4, 2004, AE Design was retained by Sponsors' predecessor to provide concept drawings for the Project. Subsequently, on March 8, 2007, AE Design entered into an amended agreement with Sponsors. Pursuant to the agreement with Sponsor, AE Design was to provide interior design drawings, with "all drawings prepared by [AE Design] [to] be reviewed and approved by the Project's architect and/or expeditor to ensure code compliance and public safety issues including but not limited to ADA compliance." The Offering Plan refers to AE Design as a "Design Architect."
Plaintiff asserts claims for breach of contract, breach of express warranty, negligence, professional malpractice, and negligent misrepresentation against AE Design. AE Design moves pursuant to 3212 for summary judgment dismissing the complaint and any cross-claims against it.
Breach of contract
AE Design argues that the breach of contract claim must be dismissed against it, as it was not in privity with plaintiff and assigned no warranties to plaintiff. In support of its motion, AE Design provides an affidavit from AE Design's principal, Andreas Escobar, stating that it entered into an agreement with Kay, Sponsor's predecessor, then it entered into an amended agreement with Sponsors when they took over the Project. A review of the agreements, provided by both plaintiff and AE Design, reveals that they contain no warranties made by AE Design. Plaintiff fails to produce any evidence suggesting that AE Design made warranties to Sponsors and that such warranties were subsequently assigned to plaintiff. As plaintiff has failed to demonstrate the existence of a factual dispute requiring resolution at trial, AE Design's motion for summary judgment is granted with respect to the breach of contract claim (see Board of Mgrs. of Riverview at Coll. Point Condominium III v Schorr Brothers Development Corp., 182 Ad2d 664, 665 [2d Dept 1992])(summary judgment properly granted when plaintiff board failed to demonstrate triable issues of fact as to whether it was a third-party beneficiary of contract between project owner and contractor).
Breach of express warranty & negligence
For the reasons discussed above with respect to the Scarano motion, plaintiff's claim for breach of express warranty and negligence are dismissed
Professional malpractice
In the absence of evidence suggesting a relationship approaching privity, plaintiff's malpractice claim is dismissed (see 905 5th Associates, Inc., 85 AD3d at 668).
Negligent misrepresentation
Plaintiff argues that AE Design created drawings to be reviewed by the Project's
[*20]architects, which it knew would be relied upon by
plaintiff, the ultimate consumer. For the reasons set forth in the Cucich motion
discussion, plaintiff's claim for negligent misrepresentation is dismissed as to AE Design
as plaintiff fails to produce evidence or even allege facts establishing that AE Design
knew and intended plaintiff to reply upon the purported misrepresentations.
Plaintiff complains of various defects, ranging from problems with the Building's foundation, leaking from ceilings, noxious odors, and improperly designed terrace railings. All moving defendants were involved in the construction or design of the Building, except for Penmark and AE Design, which have established through documentary evidence that they were merely the managing agent and interior design consultant, respectively. Many issues of fact have been raised by the moving defendants as to the cause of the alleged defects and the potential liability of co-defendants to each other under theories of indemnification or contribution. A determination of the merits of these claims requires further factual development. Accordingly, all cross claims against moving defendants which have been dismissed from this case as a result of this decision, are dismissed without prejudice to the right of an aggrieved co-defendant to commence a third party action within 30 days.
As all of plaintiff's claims are dismissed as to Penmark, the complaint against Penmark is dismissed with leave to plaintiff to replead with respect to any viable contract causes of action related to the Management Agreement.
As all of plaintiff's claims against Scarano Defendants are dismissed, the complaint is dismissed as to Scarano Defendants.
As all of plaintiff's claims against Cucich Defendants are dismissed, the complaint is dismissed as to Cucich Defendants.
As all of plaintiff's claims against Seta Defendants are dismissed, the complaint is dismissed as to Seta Defendants.
As all of plaintiff's claims are dismissed as to Simon Schwartz, individually, the complaint is dismissed only as to Simon Schwartz, individually, without prejudice to his litigating his cross and counterclaims against the remaining parties.
As all of plaintiff's claims are dismissed as to Jaccarino, the complaint is dismissed as to Jaccarino, individually.
As all of plaintiff's claims against Sharon Defendants are dismissed, the complaint is dismissed as to Sharon Defendants.
As all of plaintiff's claims against AE Design are dismissed, the complaint is dismissed as to AE Design.
All cross claims against the moving defendants are dismissed without prejudice to an aggrieved defendant bringing a third party action against a co-defendant who has been dismissed from this case as a result of this decision.
This constitutes the decision and order of the Court.
E N T E R:
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