| Arfa v Zamir |
| 2010 NY Slip Op 06064 [75 AD3d 443] |
| July 13, 2010 |
| Appellate Division, First Department |
| Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. |
| Rachel L. Arfa et al., Appellants-Respondents, v Gadi Zamir et al., Defendants. 546-552 West 146th Street LLC et al., Intervenors-Defendants/Counterclaim Plaintiffs/Cross-Claim Plaintiffs-Respondents-Appellant, et al., Intervenor-Defendant/Counterclaim-Plaintiff/Cross-Claim Plaintiff, v Rachel L. Arfa et al., Counterclaim-Defendants-Appellants-Respondents, et al., Cross-Claim Defendants. (And Another Action.) |
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Balber Pickard Maldonado & Van Der Tuin, P.C., New York (John Van Der Tuin of counsel), for respondents-appellants.
Order, Supreme Court, New York County (Charles E. Ramos, J.), entered September 16, 2008, which, to the extent appealed from as limited by the briefs, denied plaintiffs' motion to dismiss intervenors-defendants' claims for an accounting and for waste and mismanagement as against plaintiff Rachel L. Arfa and granted plaintiffs' and cross-claim defendants' motions to dismiss the claim for statutory restitution, penalties and fees pursuant to Real Property Law § 440-a, unanimously affirmed, without costs.
Intervenors-defendants, which are New York limited liability companies, allege in support of their first and fifth claims (respectively, for an accounting and for waste and [*2]mismanagement) that they were managed by Harlem Holdings, LLC, a Delaware limited liability company; that the 60% owner of Harlem Holdings was Argelt LLC, an entity owned in part by plaintiff Arfa; that Arfa, in addition to being (through Argelt) a beneficial owner of Harlem Holdings, was one of Harlem Holdings' three managers; and that Arfa used her resulting control over intervenors-defendants' property to benefit herself at intervenors-defendants' expense. As it is alleged that Arfa was a beneficial owner and fiduciary of the entity that managed intervenors-defendants, intervenors-defendants have stated causes of action sounding in breach of fiduciary duty against her under both New York and Delaware law (see Bullmore v Ernst & Young Cayman Is., 45 AD3d 461 [2007]; In re Treco, 229 BR 280, 289 [1999], affd 239 BR 36 [SD NY 1999], vacated on other grounds 240 F3d 148 [2d Cir 2001]; Bay Cent. Apts. Owner, LLC v Emery Bay PKI, LLC, 2009 WL 1124451, *9-10, 2009 Del Ch LEXIS 54, *32-39 [Del Ch 2009]; In re USACafes, L.P. Litig., 600 A2d 43, 48-50 [Del Ch 1991]).
Intervenors-defendants' second claim alleges that cross-claim defendant Amelite Management Services, Inc., the management company owned by plaintiffs Arfa and Alexander Shpigel and defendant/cross-claim defendant Gadi Zamir, while not licensed as a real estate broker, performed services for which a license is required under Real Property Law § 440-a. However, the documentary evidence demonstrates that Amelite, which admitted that it was not licensed, delegated the authority to perform those services to third-party unaffiliated licensed property management companies and therefore did not violate the statute by acting as a real estate broker.
We have considered the parties' remaining arguments for affirmative relief and find them unavailing. Concur—Mazzarelli, J.P., Andrias, Friedman, Nardelli and Moskowitz, JJ. [Prior Case History: 21 Misc 3d 1101(A), 2008 NY Slip Op 51908(U).]