650 Park Avenue Corp. v. McRae

665 F. Supp. 228
CourtDistrict Court, S.D. New York
DecidedJune 22, 1987
Docket86 Civ. 4047 (RLC)
StatusPublished
Cited by8 cases

This text of 665 F. Supp. 228 (650 Park Avenue Corp. v. McRae) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
650 Park Avenue Corp. v. McRae, 665 F. Supp. 228 (S.D.N.Y. 1987).

Opinion

OPINION

ROBERT L. CARTER, District Judge.

Plaintiff in this diversity action is 650 Park Avenue Corporation (“the Co-op”). Organized under the laws of the State of New York, the Co-op owns and maintains the cooperative apartment building at 650 Park Avenue in New York City. Defendant Maria McRae is a citizen of the State of Texas, with a residence in Houston. She owns Apartment 2-E in plaintiff’s building, where she stays during her visits to New York City.

The present dispute concerns a maid’s room on the ground floor of the building. McRae purchased Apartment 2-E in July, 1981, and at about that time she sought to purchase the maid’s room for her full-time housekeeper’s use. However, the room was reserved as part of the building’s common area and was not for sale without the consent of the shareholders. McRae settled for a monthly tenancy for her housekeeper, at a rent of $300 per month.

In early October, 1984, the Co-op informed McRae that it had entered into an agreement with several doctors to sell the maid’s room, along with other areas on the ground floor, as a professional office space. *231 On October 22, 1984, plaintiff further notified McRae that it was electing to terminate the monthly rental agreement as of November 30, 1984. Upon the request of McRae’s lawyer, however, the parties agreed in a writing dated November 14, 1984, that McRae would be allowed through December 31, 1984, to vacate the room. In return for the extension of time to vacate, McRae agreed both to remove all of her maid’s effects from the room on or before December 31, 1984, and to consent to entry of a final order against her in summary eviction proceedings.

When McRae did not vacate the maid’s room by December 31, 1984, the Co-op commenced an eviction proceeding in the Civil Court of the City of New York. McRae did not consent to entry of judgment against her. Instead, she initiated a separate proceeding in the Supreme Court of the State of New York, seeking to enjoin the Co-op from prosecuting the eviction action or from terminating the tenancy.

.The New York State Supreme Court, Justice Blyn presiding, declined to interfere with the pending summary proceeding, noting that McRae was free to raise any defenses, equitable or otherwise, before the New York City Civil Court. McRae v. 650 Park Avenue Corp., No. 2738/85 (Sup.Ct.N.Y. County Apr. 8, 1985). 1 Then, after trial on the merits, Judge Dubinsky of the New York City Civil Court granted final judgment of possession to the Co-op. Judge Dubinsky explicity rejected McRae’s defense that she was fraudulently induced to agree to vacate the maid’s room. 650 Park Avenue Corp. v. McRae, No. L & T 100491/84, slip op. at 2 (N.Y. City Civil Ct. July 5, 1985). He ruled that the Co-op had the right unilaterally to terminate the tenancy as it did: He found that the room was not subject to rent stabilization under the Emergency Tenant Protection Act of 1974, Administrative Code of the City of New York, § YY51-3.0; and he also found that the Co-op had not contravened the provisions of N.Y. Gen. Bus. Law § 352 et seq., in particular section 352-eeee (“Conversions to cooperative or condominium ownership in the city of New York”), even assuming that those provisions were applicable. 650 Park Avenue Corp. v. McRae, supra, No. L & T 100491/84, slip op. at 2 (citing Cohen v. Brown, Harris, Stevens, Inc., 64 N.Y.2d 728, 485 N.Y.S.2d 745, 475 N.E.2d 116 (1984)). Judge Dubinsky’s decision was affirmed by the Appellate Term of the Supreme Court of the State of New York. 650 Park Avenue Corp. v. McRae, No. 86-104 (App. Term 1st Dep’t Apr. 8, 1986).

McRae surrendered possession of the maid’s room on August 1, 1985. The Co-op proceeded on September 30, 1985, to execute a closing on the sale of the office space.

In the present action, the Co-op claims damages resulting from McRae’s failure to vacate the maid’s room by December 31, 1984. It alleges that the prospective purchasers of the office space were ready, willing, and able to close on the sale by March 1, 1985. It seeks lost maintenance payments of $1,850 per month for the months March through September, 1985. In addition, plaintiff alleges that it had planned to pay off a mortgage on the apartment building with the proceeds of the sale. It claims interest payments of $7,200 per month which it continued to pay on the mortgage during the seven-month period. Finally, plaintiff seeks attorney’s fees of $29,427.29, allegedly incurred in the various proceedings in New York state courts. McRae answers that none of her conduct was in breach of any agreement, and she counterclaims for damages for loss of use of the maid’s room. The Co-op now moves for summary judgment on each of its claims.

*232 DISCUSSION

The motion for summary judgment will be granted only if no material fact is genuinely at issue and the Co-op is entitled to judgment as a matter of law. Rule 56(c), F.R.Civ.P.; Knight v. U.S. Fire Insurance Co., 804 F.2d 9, 11 (2d Cir.1986), cert. denied, — U.S. —, 107 S.Ct. 1570, 94 L.Ed.2d 762 (1987).

McRae attempts to raise a number of factual issues relating to both her defenses and her counterclaim. She argues that she purchased Apartment 2-E on the condition (apparently unstated) that she would have use of the maid’s room. Similarly, she alleges, the Co-op assured her that she would be given a right of first refusal should the room be put up for sale. In addition, McRae contends that she agreed in writing to vacate the room only after the Co-op informed her that it was legally entitled to sell the room. Thus, she concludes, both her purchase of Apartment 2-E and her agreement to vacate the maid’s room were fraudulently induced.

None of these contentions presents a genuine issue of fact, because the principle of collateral estoppel precludes consideration of any of them. Stated otherwise, her contentions already have been fully litigated and resolved in the courts of the State of New York.

Collateral estoppel is a limited application of res judicata doctrine. Commissioner of Internal Revenue v. Sunnen, 333 U.S. 591, 597-98, 68 S.Ct. 715, 719-20, 92 L.Ed. 898 (1948). Both the broader doctrine and its narrower corollary serve to prevent duplicative litigation, as both rules are aimed at conservation of judicial resources and maintenance of social order through finality in legal relations. See id.

The broader doctrine of res judicata prohibits relitigation of the same cause of action. Id. at 597, 68 S.Ct. at 719. More precisely, the doctrine holds that a final judgment, entered on the merits of a cause of action by a court of competent jurisdiction, is binding on the parties and on those in privity with them. Id.

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Bluebook (online)
665 F. Supp. 228, Counsel Stack Legal Research, https://law.counselstack.com/opinion/650-park-avenue-corp-v-mcrae-nysd-1987.