Goldstein, Rikon, Rikon & Levi, P.C. v. 35 Delevan Owners LLC

2023 NY Slip Op 34583

• Court: New York Supreme Court, Kings County
• Decided: December 18, 2023
• Status: Unpublished

Opinion

Goldstein, Rikon, Rikon & Levi, P.C. v 35 Delevan Owners LLC 2023 NY Slip Op 34583(U) December 18, 2023 Supreme Court, Kings County Docket Number: Index No. 513884/2022 Judge: Ingrid Joseph Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

At At an IAS lAS Part Part 83 of of the the Supreme Supreme Court Court of of the State State of New York of New York held held in and and for the County County of Kings of Kings at 360 360 Adams Adams Street, Street, Bro~ew Brooklyn, New York, _pQ~ on the ~ d a y of ~023. York,onthe~dayof 023. PRESENT: PRESENT: HON. INGRID JOSEPH, HON.INGRID JOSEPH, J.S.C. J.S.C. SUPREME SUPREME COURT COURT OF THE THE STATE STATE OF NEW YORK NEW YORK COUNTYCOUNTY OF KINGS KINGS ----------------------------------------------------------------------X Index Index No: 513884/2022 51388412022 ----------------------------------------------------------------------)( GOLDSTEIN, GOLDSTEIN, RIKON, RIKON, RIKON RIKON & LEVI, LEVI, P.C., P.C., Plaintiff(s) Plaintiff(s) -against- -against- ORDER ORDER 35 DELEVAN DELEVAN OWNERS OWNERS LLC LLC and HARBOR HARBOR TECH TECH LLC, LLC, And NEW NEW YORK YORK CITY CITY SCHOOL SCHOOL CONSTRUCTION CONSTRUCTION AUTHORITY, AUTHORITY, Defendant( Defendant(s)s) ----------------------------------------------------------------------X ----------------------------------------------------------------------)( NYSCEFNos.: NYSCEF Nos.: The The following following e-filed e-filed papers papers read read herein: herein: Notice of Notice of Motion/ Affirmation in Support/ Motion/Affirmation Support! Affidavits Affidavits Annexed· Annexed Exhibits Annexed/Reply .......... . Exhibits Annexed/Reply 10-21; 33 10-21; Affirmation Affirmation in Opposition/Affidavits Opposition/Affidavits Annexed/Exhibits Annexed/Exhibits Annexed Annexed ........... . 22-31

In this this matter, New York matter, New York City City School School Construction Construction Authority Authority ("SCA" ("SCA" or "Defendant") "Defendant") moves moves (Motion (Motion Seq. 1) for an order order pursuant pursuant to CPLR SS 321 Ha)(l) CPLR §§ 1(a)(l) and and (a)(7) (a)(7) dismissing dismissing Goldstein, Goldstein, Rikon, Rikon, ·," Rikon, & Levi, Rikon, Levi, P.C. P.C.'s's ("Goldstein" ("Goldstein" or or "Plaintiff') "Plaintiff') Verified Verified Complaint Complaint with with prejudice prejudice on the the ground ground that that Plaintiff Plaintiff has has failed failed to state state a viable viable cause cause of of action action against against SCA. SCA. Plaintiff Plaintiff has has opposed opposed the the motion. motion. Plaintiff Plaintiff commenced commenced this this action action on May May 12, 2022, to recover 12,2022, recover legal legal fees purportedly owed fees purportedly owed for legal legal services services it rendered rendered to former former clients, clients, Defendants Defendants 35 Delevan Delevan Owners Owners LLC LLC ("35 ("35 Delevan") Delevan") and Harbor Harbor Tech Tech LLC LLC ("Harbor"). ("Harbor"). In its Verified Verified Complaint, Complaint, Plaintiff Plaintiff alleges alleges that that Defendants Defendants 35 Delevan Delevan and Harbor Harbor retained retained Plaintiff's Plaintiff's predecessor-in-interest, predecessor-in-interest, Goldstein, Goldstein, Rikon, Rikon, & Houghton, Rikon, Rikon, Houghton, P.C. P.e. to obtain obtain just compensation just compensation for Defendants Defendants 35 Delevan Delevan and Harbor Harbor in connection connection with with SCA's SCA's acquisition acquisition of of and/or and/or condemnation of the condemnation of two two properties properties located located at 21-3 21-31I and 35 Delevan Delevan St. Brooklyn, New York Brooklyn, New York 11231 (the (the "Subject "Subject Premises"). Premises"). Plaintiff Plaintiff contends contends that that the retainer retainer agreement agreement between between 35 Delevan, Delevan, Harbor, Harbor, and Plaintiff's predecessor-in-interest and Plaintiff's predecessor-in-interest and its charging charging lien now now entitles entitles Plaintiff Plaintiff to a contingency contingency fee based based on . a percentage percentage of of all amounts amounts received received from SCA, SCA, "whether "whether by award, award, suit, suit, purchase, purchase, settlement, settlement, supplemental supplemental advance advance payment, payment, or otherwise otherwise including including interest." interest." Plaintiff Plaintiff asserts asserts causes causes of of action action for breach breach of of contract, contract, breach breach of of duty duty of of good good faith and fair dealing, dealing, entitlement entitlement to to an attorney's attorney's lien on proceeds proceeds of of settlement pursuant to Judiciary settlement pursuant Judiciary Law Law 475 and for a constructive constructive bailment bailment as to SCA. SCA. In its Verified Verified Complaint, Complaint, Plaintiff alleges that Plaintiffalleges that it was was retained retained by Defendants Delevan and. Defendants 35 Delevan and Harbor Harbor on October October 16, 2018, 2018, as evidenced evidenced by the parties' parties' Engagement Engagement Letter Letter and and Retainer Retainer Agreement. Agreement. The The Verified Verified Complaint Complaint states states that that SCA SCA made made a pre-vesting pre-vesting offer offer to purchase purchase the the Subject Subject Premises Premises for ·

/ 1 of 10 [* 1] "- - .. - - -------------_._---------- f FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

$18,300,000.00, which $18,300,000.00, which was was rejected rejected by by Plaintiff Plaintiff on behalf of its former behalf of former clients via letter clients via February dated February letter dated 28,2019. 28, 2019. On On December December 8, 2020, 2020, Plaintiffs predecessor-in-interest and 35 Delevan Plaintiffs predecessor-in-interest signed an Delevan signed acknowledgement letter acknowledgement letter wherein wherein it states states that LLC is changing Owners LLC Delevan Owners that "35 Delevan changing its name 21 and 35 name to 21 Delevan Delevan LLC, LLC, that that this this is a change change in name name only, ownership, that only, not ownership, and 35 Delevan that 21 and Hereby LLC Hereby Delevan LLC Agrees Agrees to Retain Goldstein, Rikon, Retain Goldstein, Rikon & Houghton, Rikon, Rikon bound by the agrees to be bound Houghton, and agrees Retainer the Retainer Agreement Agreement signed signed by 35 Delevan Delevan Owners Owners LLC October 16,2018 LLC on October consents and 16,2018 and consents Terms agrees to all Terms and agrees Conditions therein." and Conditions Plaintiff alleges Furthermore, Plaintiff therein." Furthermore, alleges that ongoing efforts, through its ongoing that through efforts, SCA increased its SCA increased purchase purchase offer offer to $32,000,000.00, $32,000,000.00, which which Plaintiff accepted on behalf Plaintiff accepted former clients of its former behalf of of March of clients in March 2022. However, 2022. However, on April 8,2022,35 April 8, 2022, 35 Delevan terminated Plaintiffs Harbor terminated Delevan and Harbor representation and Plaintiffs representation requested requested that that their their files be transferred Carter Ledyard transferred to the firm Carter LLP. On Milburn LLP. Ledyard & Milburn 8, 2022, April 8,2022, On April Plaintiff Plaintiff states states that that it informed informed counsel counsel at the the newly appo,inted firm that newly appojnted files would that no files transferred until be transferred would be Plaintiffs Plaintiffs attorney's April 11, satisfied. On April attorney's lien is satisfied. 11,2022, sent counsel Plaintiff sent 2022, Plaintiff and SCA counsel and of a copy of SCA a copy Notice Notice of of Lien Lien and and an Amended Amended Notice Notice of of Lien Lien and informed counsel that informed counsel the lien that the would be released lien would upon released upon payment of$l, payment of 844, 149 $1, 844, 149.27 .27 for legal expenses. The and expenses. legal fees and Verified Complaint The Verified also states Complaint also states that April that on April 21,2022, 21, 2022, Plaintiff Plaintiff sent sent a copy copy of of the Amended Notice of Amended Notice Lien to Lex of Lien Terrae Ltd., Lex Terrae which upon Ltd., which information upon information and belief belief is the the title company that title company hired by SCA that has been hired SCA to handle transfer of the transfer handle the the Subject of the Premises Subject Premises from 35 Delevan Delevan and Harbor Harbor to SCA. SCA. On May 17, On May 17,2022, Delevan LLC" 2022, "21 and 35 Delevan and "SCA: LLC" and entered "SCA: entered into a Purchase Agreement for the Subject Purchase and Sale Agreement Subject Premises. 26, 2022, May 26, Premises. On May Closing Settlement 2022, a Closing Settlement Statement was Statement signed by the was signed the parties parties and issued issued by Old Republic National Commercial Republic National Title Services. Commercial Title Services. In support support of of its motion, motion, SCA that Plaintiff argues that SCA argues failed to assert Plaintiff has failed viable cause assert a viable action for of action cause of a constructive constructive bailment bailment or for entitlement or for charging lien because entitlement to a charging never had Plaintiff never because Plaintiff right or any right had any interest interest in SCA's SCA's money money either either before before or after after it purchased fr~m 35 Delevan property from purchased the property Harbor. and Harbor. Delevan and SCA states states that that 35 Delevan Delevan and Harbor, Harbor, who who were former owners the former were the owners of the Subject of the Subject Premises, tenninated Premises, terminated Plaintiff Plaintiff for cause cause on April April 8, 2022, 2022, after after learning learning that was simultaneously Plaintiff was that Plaintiff tenant representing a tenant simultaneously representing of 35 Delevan of Delevan and Harbor Harbor in relation relation to the property, and that the property, while new that while that that counsel was new counsel process the process was in the of of negotiating negotiating the the terms terms of of a potential potential sale, sale, Plaintiff initiated this Plaintiff initiated action. With this action. respect to Plaintiffs With respect claim Plaintiff's claim entitlement to a charging for entitlement charging lien, SCA argues that SCA argues automatic lien arose that no automatic under Judiciary arose under Law S 475 Judiciary Law§ because because there there can can be no liability liability to a third-party third-party under the statute under the statute without the commencement without the action of an action commencement of or proceeding proceeding by an attorney attorney at the the time the attorney's time the services were attorney's services were rendered invoke the rendered so as to invoke jurisdiction jurisdiction of of the the court court over over a third-party. SCA asserts third-party. SCA asserts that Plaintiff "merely that Plaintiff "merely responded pre-vesting responded to a pre-vesting offer offer made made by SCA," SCA," which rejected on February which it rejected 2019. February 28, 2019. Additionally, SCA claims Additionally, SCA claims that that the the 2012 amendment of 2012 amendment of Judiciary Law§S 475 was Judiciary Law was not intended to not intended allow allow an attorney attorney who who provided provided pre-litigation pre-litigation services the requirements bypass the services to bypass serve a formally serve requirements to formally Notice of Lien Notice of Lien on a third-party third-party so that that a court may acquire court may jurisdiction over acquire jurisdiction the third over the pursuant to party pursuant third party

2 of 10 [* 2] FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

companion statute companion statute Judiciary Law§S 475-a. Judiciary Law SCA states Moreover, SCA 475-a. Moreover, that Plaintiffs states that lien notices Plaintiffs lien are defective notices are defective pursuant to Judiciary pursuant Law S 475-a Judiciary Law§ 475-a because (l) they because (l) were sent they were regular mail, sent by regular (2) they mail, (2) state any failed to state they failed established attorney-client established relationship, and (3) attorney-client relationship, they were (3) they not signed were not signed by Plaintiff's clients by Plaintiffs witnessed nor witnessed clients nor person. disinterested person. by a disinterested With With respect respect to Plaintiffs constructive bailment Plaintiff's constructive SCA argues claim, SCA bailment claim, argues that Plaintiff has failed that Plaintiff failed to assert any assert any facts, if true, which, if facts, which, would have true, would created a constructive have created bailment or made constructive bailment SCA its the SCA made the constructive bailee. constructive bailee. SCA that that asserts that SCA asserts that the money over the money which Plaintiff over which claims a constructive Plaintiff claims bailment constructive bailment was the SCA's was SCA's own own property property and was used and was after the lawsuit used after was filed to purchase lawsuit was Property from 35 the Property purchase the Delevan and Harbor. Delevan Harbor. SCA SCA argues argues that the extent that to the that Plaintiff extent that claims a right Plaintiff claims portion of right to a portion the money of the money paid for the sale, paid sale, under under the plain terms of plain terms retainer agreement of its retainer agreement with Delevan and with 35 Delevan and Harbor, right that right Harbor, that can only can only have have arisen arisen after after the closing once the closing money was once the money paid to the was paid Delevan and the 35 Delevan Harbor. SCA and Harbor. SCA claims that claims that it never never held money claimed any money held any Plaintiff and that claimed by Plaintiff the Purchase that the and Sale Purchase and Agreement Sale Agreement establishes that establishes that the the title company apportioned title company any amounts apportioned any owed to third-parties amounts owed of the purchase. out of third-parties out purchase. SCA states SCA states the the lien notices are also notices are create a constructive insufficient to create also insufficient constructive bailment Plaintiffs because Plaintiffs bailment because interest in the interest the funds funds did not not vest until the vest until funds were the funds paid to the were paid Delevan and the 35 Delevan Harbor, therefore, and Harbor, therefore, Plaintiff could Plaintiff could not not have have had had any the purchase any lien on the price or SCA's purchase price SCA's money after it left SCA's until after money until SCA's hands. SCA hands. SCA submits submits affidavits affidavits of Neumann ("Neumann"), Elliot Neumann of Elliot signatory for 35 Delevan authorized signatory ("Neumann"), an authorized Delevan and Harbor Harbor and Edward Edward Perez Perez ("Perez"), senior attorney ("Perez"), senior SCA, wherein of SCA, attorney of parties merely wherein parties that copies state that merely state copies of submitted of annexed as exhibits. documents are annexed submitted documents exhibits. In opposition, opposition, Plaintiff Plaintiff argues argues that asserted viable that it has asserted of actions causes of viable causes SCA did hold a because SCA actions because of money, fund of money, which constituted as Plaintiffs which constituted Plaintiff's property, had a charging property, and had lien on it, and charging lien and that because that because SCA wrongfully SCA wrongfully disposed disposed of entire fund the entire of the without paying fund without Plaintiff or paying Plaintiff money to cover reserving money or reserving cover Plaintiffs liens, it violated Plaintiff's liens, violated its obligations bailee of obligations as bailee of the Plaintiff states the fund. Plaintiff states that under Judiciary that under Law§S Judiciary Law charging liens 475 charging liens arise arise either either when appears in a proceeding lawyer appears when a lawyer lawyer begins when a lawyer proceeding or when begins negotiating settlement of negotiating a settlement Plaintiff contends dispute. Plaintiff of dispute. contends that charging lien obtained a charging that it obtained lien not only by not only appearing on behalf appearing behalf of of 3 35 Delevan and Harbor 5 Delevan condemnation proceeding, SCA' s condemnation Harbor in SCA' also by but also proceeding, but negotiating dispute between negotiating the dispute former clients between its former wherein SCA SCA, wherein clients and SCA, SCA purchased Subject Premises the Subject purchased the Premises in lieu of of condemnation. condemnation. Plaintiff that SCA claims that Plaintiff claims condemnation proceeding began the condemnation SCA began pursuant to proceeding pursuant Article 2 of Article of the the Eminent Eminent Domain Domain Procedure July of Law in July Procedure Law 2021, by issuing of202l, Notice of issuing a Notice Public Hearing ofaa Public Hearing which, Plaintiff which, Plaintiff received and attended received and August 14, 2019. attended on August Plaintiff claims Furthermore, Plaintiff 2019. Furthermore, that SCA claims that issued SCA issued Determination of a Determination of Findings November of Findings in November 20 19, wherein of 2019, SCA made wherein SCA the initial made the exercise its decision to exercise initial decision condemnation power condemnation over the power over the property. However, SCA property. However, ultimately increased SCA ultimately offer to purchase offer increased its purchase $32,000,000.00, which $32,000,000.00, which Plaintiff Plaintiff accepted behalf of accepted on behalf clients before former clients of its former terminated. Plaintiff being terminated. before being Plaintiff maintains that payment maintains that of the payment of the purchase price of purchase price of the property through the property company did title company through a title not extinguish did not extinguish

3 of 10 [* 3] FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

that SCA' its lien and that argument that SCA'ss argument defective is immaterial were defective notices were that its lien notices immaterial because Plaintiff is not because Plaintiff not moving moving under under Judiciary Law§S 475-a Judiciary Law under Judiciary but under 475-a but Law§S 475, Judiciary Law which does 475, which not require does not notice. Thus, require notice. Thus, Plaintiff Plaintiff claims claims it has has established entitlement to a charging established entitlement any fund favor in any charging lien in its favor created for its fund created former client, former client, which which attached attached the moment the the moment settlement was the settlement agreed upon. was agreed respect to Plaintiffs With respect upon. With Plaintiffs claim for a constructive claim Plaintiff argues bailment, Plaintiff constructive bailment, argues that because SCA that because holding $1,844,149.28 SCA is holding under $1,844,149.28 under circumstances circumstances where where the the law imposes a duty law imposes upon SCA duty upon SCA to deliver Plaintiff, that deliver it to Plaintiff, viable Plaintiff has a viable that Plaintiff cause of cause against SCA. action against of action SCA Upon motion to dismiss Upon a motion dismiss pursuant S 3211 (a)(l), CPLR § pursuant to CPLR where warranted where dismissal is warranted (a)(l), dismissal documentary evidence refutes documentary evidence refutes plaintiffs factual allegations plaintiffs factual establishes a defense and establishes allegations and of law matter of defense as a matter (Leon at 88; Goshum (Leon Goshum v Mutual ofNew Life Ins. Co. of Mutual Life 314 [2002]; NY2d 314 New York, 98 NY2d [2002]; Brio A.D.3d Roth, 121 AD.3d Brio v Roth, Dept. 2014]).To 733 [2d Dept. constitute documentary 20 14]).To constitute the evidence evidence, the documentary evidence, must be "unambiguous, evidence must "unambiguous, authentic, and undeniable," authentic, undeniable," such records and documents judicial records such as judicial reflecting out-of-court documents reflecting transactions out-of-court transactions such as mortgages, such mortgages, deeds, deeds, contracts, and any contracts, and other papers, any other the contents papers, the of which contents of essentially are essentially which are undeniable ((Granada undeniable Granada Condominium Assn. v. III Assn. Condominium III Palomino, 78 A.D.3d v. Palomino, Dept. 201 996 [2d Dept. AD.3d 996 2010]; Prott v. 0]; Prott Lewin v. Lewin & Baglio, Bag/io, LLP, ISO AD3d LLP, 150 AD3d 908 Dept 2017]). 908 [2d Dept affidavit is not 2017]). An affidavit documentary evidence not documentary because its evidence because contents contents can be controverted controverted by other such as another evidence, such other evidence, (Xu v Van Zqienen, affidavit (Xu another affidavit A.D.3d Zqienen, 212 AD.3d Dept. 2023]; 872 [2d Dept. 2023]; Phillips Bell Corp., 152 A.D.3d Phillips v Taco Bell Dept. 2017]; AD.3d 806 [2d Dept. Fontanetta v John 2017]; Fontanetta Doe John Doe I, 73 A.D.3d I, Dept. 2010]). A.D.3d 78 [2d Dept. 2010]). Where evidence contradicts documentary evidence Where documentary contradicts the allegations of the allegations the complaint, of the the court complaint, the court need not need not assume the assume the truthfulness truthfulness of of the allegations (West pleaded allegations the pleaded Branch Conservation (West Branch Assn, Inc., v County Conservation Assn, of County of Rockland, Rockland, 227 AD.2d 547 [2d Dept. 227 A.D.2d Greene v Doral 1996]; Greene Dept. 1996]; Conference Center Doral Conference Associates, 18 A.D.3d Center Associates, AD.3d 429 429 [2d Dept. Dept. 2005]); 2005]); Penato Penato v. George, 52 AD.2d v. George, Dept 1976]). 939, 941 [2d Dept A.D.2d 939, 1976]). Allegations consisting of Allegations consisting of bare bare legal legal conclusions conclusions as well well as factual claims flatly factual claims documentary evidence contradicted by documentary flatly contradicted not are not evidence are entitled to any entitled any such such consideration (Connaughton v Chipotle consideration (Connaughton Chipotle Mexican N.Y.3d 137 [2017]; Mexican Grill, Inc., 29 N.Y.3d [2017]; Duncan Duncan v Emeral Emera/ Expositions Expositions LLC, LLC, 186 A.D.3d Dept. 2020]; A.D.3d 1321 [2d Dept. 2020]; Dinerman Jewish Bd. of Dinerman v Jewish Family of Family Children's Services & Children's Services Inc., 55 AD.3d 2008]; Nisari Dept. 2008]; A.D.3d 530 [2d Dept. Ramjohn, 85 AD.3d v. Ramjohn, Nisari v. 989 [2d 987, 989 A.D.3d 987, Dept 2011 Dept 2011]). The defendant ]). The defendant bears burden of bears the burden demonstrating that of demonstrating evidence "conclusively proffered evidence that the proffered "conclusively refutes plaintiffs refutes allegations (Guggenheimer factual allegations plaintiffs factual 268 [1977]; NY2d 268 Ginzburg, 43 NY2d (Guggenheimer v Ginzburg, Ko/chins v [1977]; Kolchins Evolution Evolution Mias. Mlcts. Inc., 31 NY3d [2018]; Goshen NY3d 100 [2018]; Goshen v Mutual Life Ins. Co. of Mutual Life 314 [2002]). NY2D 314 of NY, 98 NY2D [2002]). New New York York law generally recognizes law generally three remedies recognizes three attorney making remedies for an attorney against a claim against making a fee claim former client: former client: (1) (1) the lien, (2) the charging lien, the charging retaining lien, and the retaining (3) a plenary and (3) quantum meriut action in quantum plenary action meriut (Levy v Laing, (Levy Laing, 43 AD3d I st Dept. AD3d 713 [[1st charging lien is an equitable 2007]). A charging Dept. 2007]). ownership interest, equitable ownership interest, originating originating from from common common law and and later codified under later codified Law§S 475, Judiciary Law under Judiciary which grants 475, which attorney, a grants an attorney, property right property right in a client's client's cause of action cause of Maher v Quality see Maher action ((see Bus Services, Quality Bus Services, LLC, 990 [2d AD3d 990 LLC, 144 AD3d

4 of 10 [* 4] FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

Dept. 2016]; J.K.c. Dept. 2016]; T.WC., 39 Misc.3d J.K.C. v T.W.C., 2013 NY Misc.3d 889, 2013 Slip. Op. NY Slip. 23060 [Sup Op. 23060 Monroe County [Sup Ct, Monroe 2013]; County 2013]; Chadbourne & Parke, Chadbourne Parke, LLP LLP v AB AB Recur Finans, 18 AD3d Recur Finans, 222 [1st AD3d 222 Dept. 2005]). [1st Dept. equitable ownership This equitable 2005]). This ownership interest cannot interest cannot subsequently subsequently be the client disturbed by the be disturbed anyone claiming client or anyone claiming through or against through or the client against the client (LMWT Realty (LMWT Realty Corp. v Davis Davis Agency Agency Inc., (1995]). "Manifestly, NY2d 462 (1995]). Inc., 85 NY2d then, an attorney's "Manifestly, then, attorney's charging lien is something charging something more more than than a mere against either claim against mere claim property or either property or proceeds vested ... it is a vested proceeds ... property right property right created created by law and not a priority and not payment" (Id. at 467-468). of payment" priority of charging lien, Initially, a charging 467-468). Initially, would automatically come would automatically come into existence, without into existence, without notice or filing, notice or filing, upon commencement of upon commencement of an the of of the action and was action was measured measured by the the reasonable value of reasonable value services in the attorney's services of the attorney's unless fixed by action, unless the action, agreement (Judiciary an agreement (Judiciary Law Law §475; LMWT Realty 9475; LMWT Theroux v Theroux, 467; Theroux Realty Corp. at 467; AD 625 [2d Theroux, 145 AD Dept. Dept. 1989]; Resnick Resnick v Resnick, Resnick, 24 AD 238 [1st AD 3d 238 [1st Dept. Effective January 2005]). Effective Dept. 2005]). Judiciary I, 2013, Judiciary January 1,2013, Law § Law 94475 was expanded 75 was include that expanded to include also applies that it also "initiation of applies to the "initiation any means of any of alternative means of alternative dispute resolution dispute ... or resolution ... or the provision of the provision services in a settlement of services settlement negotiation stage of any stage negotiation at any the dispute of the dispute (Judiciary Law (Judiciary Law §475; Bonnaigv Walton, 9475; Bonnaigv Misc. 3d 375, Walton, 41 Misc. 2013 NY 375, 2013 Slip Op. 23185 NY Slip NY County [Sup Ct, NY 23185 [Sup County 2013]). 2013 Thus, attorneys ]). Thus, attorneys seeking enforce charging seeking to enforce not only may do so not charging liens may only with respect to an officially with respect officially commenced proceeding commenced proceeding but also for out-of-court but also settlement agreements. out-of-court settlement agreements. As a general general rule, charging lien follows rule, a charging the fund follows the settlement of created by a settlement fund created of the and it claim and the claim attaches to the attaches the amount amount agreed agreed upon settlement the upon in settlement instant that the instant agreement is made, that the agreement if the and if made, and defendant pays defendant over to the pays over the client client without providing for the without providing of the the lien of attorney, he violates the attorney, of the rights of violates the rights latter and must latter must stand stand the the consequences consequences (Fontana Republic of (Fontana v Republic Argentina, 962 of Argentina, 962 F.3d 2020]; 667 [2d Cir. 2020]; F.3d 667 see In re Shirley see Shirley Duke Duke Assoc., Assoc., 611 F2d 1979]; citing F2d 15 [2d Cir. 1979]; citing Fischer-Hansen Brooklyn, Hgts. R. Co., Fischer-Hansen v Brooklyn, 173 NY NY 492 Chadbourne & Parke, [1903]; Chadbourne 492 (1903]; LLP at 223). Parke, LLP Thus, an attorney 223). Thus, may enforce attorney may enforce his lien against a lien against defendant who defendant who failed failed to provide attorney's fee because the attorney's provide for the who has defendant who because a defendant of a knowledge of has knowledge plaintiffs plaintiffs attorney's affirmative duty under an affirmative attorney's lien is under duty to protect and if the lien, and protect the ifhe fails to do so, he is he fails liable for the liable the reasonable reasonable value value of of that services to his client attorney's services that attorney's (Fontana at 676; client (Fontana Fischer-Hansen at 676; Fischer-Hansen 501; Sargent Sargent v New HR.R. Co., 209 NY York Cent. & HR.R. New York 360 (1913]; NY 360 see also [1913]; see also Schneider, Kleinick, Weitz, Schneider, Kleinick, Damashek Shoot v City Damashek & Shoot City of of New 2002]; citing Dept. 2002]; New York, 302 AD 2d 183 [[1I stsl Dept. Sehlmeyer v Universal citing Sehlmeyer Universal Oven Co., Oven Co., 118 AD2d AD2d 692 692 (2d Dept. 1986]). [2d Dept. charging lien thus 1986]). A charging enforced even may be enforced thus may even when proceeds when the proceeds have passed have passed into the the possession possession of of the the client third party client or a third with knowledge, party with although the knowledge, although right to enforce the right enforce such a lien will such will be waived waived by any any action action inconsistent intent to enforce with an intent inconsistent with the lien (see enforce the Kaplan v (see Kaplan Reuss, Reuss, 113 AD AD 2d 184 [2d Dept. Dept. 1985]; Fontana Republic of Fontana v Republic Argentina, 2021 WL of Argentina, 4481874 [SONY WL 4481874 [SDNY 2021]; 2021 Sprole v Sprole, ]; Sprole Sprole, l152 52 AD3d Goldstein, Goldman, 2017]; Goldstein, Dept. 2017]; AD3d 1094 [3d Dept. Goldman, Kessler, Underberg v Kessler, & Underberg 4000 East 4000 East River River Road Road Associates, Associates, 64 AD2d AD2d 484484 [4d 1978]). Moreover, the 1978]). Moreover, Court of the Court Appeals has of Appeals repeatedly held repeatedly held that that an attorney's attaches to a settlement attorney's lien attaches instances where even in instances settlement even settlement was the settlement where the made made without without the attorney's knowledge, the attorney's participation in the knowledge, participation settlement or the settlement or where the attorney where the withdrew attorney withdrew

5 of 10 [* 5] FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

prior prior to the the negotiation of that negotiation of settlement (see that settlement (see Fischer-Hansen; Sargent at 365; Fischer-Hansen; Sargent 365; Klein NY2d Eubank, 87 NY2d Klein v Eubank, 459 [1996]). 459 [1996]). The The one exception to an attorney's one exception when the entitlement to a lien is when attorney's entitlement terminated for attorney is terminated the attorney cause (Klein cause (Klein v Eubank, Eubank, 87 NY2d 459 [1996]; NY2d 459 Maher v Quality [1996]; Maher Quality Bus Service, LLC, Bus Service, 990 [2d AD3d 990 LLC, 144 AD3d Dept. 2016]; Dept. 2016]; Callaghan Callaghan v Callaghan, AD3d 500 [2d Dept. Callaghan, 48 AD3d While termination 2008]). While Dept. 2008]). may be cause may termination by cause based based upon either negligence upon either negligence or misconduct, more than misconduct, more generalized dissatisfaction than a generalized with counsel's dissatisfaction with counsel's services is required services required and and the the client must make client must prima facie make a prima showing of facie showing cause in order of cause trigger a hearing order to trigger hearing the issue on the issue (Maher (Maher at 992; 992; Roe Roe v Roe, Roe, 117 AD3d 2014]; Chadbourne Dept. 2014]; AD3d 1217 [3d Dept. LLP at Parke, LLP Chadbourne & Parke, 222). 222). Here, the Here, the court court finds finds that that documentary evidence submitted documentary evidence SCA did submitted by SCA utterly refute not utterly did not refute Plaintiffs factual allegations Plaintiffs factual allegations that held funds SCA held that SCA belonging to Plaintiff funds belonging or in which Plaintiff or had an Plaintiff had which Plaintiff interest in and failed interest failed to payout required, nor pay out as required, establish a defense conclusively establish nor conclusively of law. SCA matter of defense as a matter SCA submits a submits copy of 11 copy of the the Engagement Engagement Letter Retainer Agreement, Letter and Retainer copy of Agreement, a copy of the Purchase and Sale the Purchase Sale Agreement, a copy Agreement, copy of of the the Warranty Warranty Deed December 11, dated December Deed dated 2020, by 35 Delevan 11,2020, LLC granting Owners LLC Delevan Owners granting to 21 and 35 Delevan Delevan LLC LLC title title to the copy of property, and a copy the property, of the Closing Settlement the Closing issued by Statement issued Settlement Statement Old Republic Old Republic National Title Services Commercial Title National Commercial with the connection with Services in connection May 26, 2022, closing on May the closing 2022, between Delevan LLC between 21 and 35 Delevan SCA as "purchaser." "seller" and SCA LLC as "seller" "purchaser." While a retainer While retainer agreement agreement alone alone may insufficient to establish may be insufficient "appearance" under establish an "appearance" under Judiciary Law Judiciary Law 475 (see (see Cataldo Cataldo v Budget Rent A Car Budget Rent NY2d 811(1997]), Corp., 89 NY2d Car Corp., that 35 undisputed that 811[1997]), it is undisputed Delevan and Harbor Delevan Harbor retained Plaintiffs predecessor-in-inter retained Plaintiffs agreed to pay and agreed predecessor-in-interestest and contingency fee in pay a contingency exchange for legal exchange legal services relating to its condemnation services relating condemnation proceeding. also undisputed proceeding. It is also that 35 undisputed that Delevan's Delevan's name name change change to "21 and and 35 Delevan was a change LLC" was Delevan LLC" change in name only and name only and not ownership, and not ownership, that 21 and 3 that 355 Delevan Delevan LLC agreed to be bound LLC agreed original Engagement under the original bound under and Retainer Letter and Engagement Letter Retainer Agreement. Agreement. Furthermore, SCA does Furthermore, SCA does not dispute that not dispute commenced a condemnation that it commenced proceeding by condemnation proceeding sending Notice sending Notice of of a Public Public Hearing Hearing nor does it argue nor does proffer evidence argue or proffer that Plaintiff evidence that did not Plaintiff did engage in not engage settlement negotiations. settlement negotiations. SCA cites SCA cites Schneider, Schneider, Kleinick, Kleinick, Weitz, Damashek City of Shoot v City Damashek & Shoot of New AD 2d New York, 302 AD Dept. 2002) (lS!1 Dept. 183 (P 2002) and Chesley v Union Carbide and Chesley Corp., 927 Carbide Corp., F.2d 60 (2d 927 F.2d 1991) to support Cir. 1991) (2d Cir. support position that the position that filing formal proceeding filing a formal order for there necessary in order proceeding is necessary statutory liability there to be statutory liability against third against third parties parties because the court because the must have court must jurisdiction over have jurisdiction the third over the third party and the party and the settlement funds. settlement funds. Not Not only only does does that that claim claim fail to rebut the settlement rebut the settlement negotiation that language that negotiation language was added was added to Judiciary Law S 475 by the Judiciary Law§ 2012 amendment the 2012 of the contravention of direct contravention amendment but is in direct statute which statute states that which states "the court that "the court upon upon the Petition of the Petition of the the attorney client or the the client may determine attorney may determine and enforce and enforce the the lien" lien" (see (see Judiciary Law 9 475). Judiciary Law§ 475). Moreover, stated in Schenider, Moreover, as stated enforcement of Schenider, enforcement of charging lien is founded a charging founded upon notion that equitable notion upon the equitable that the proceeds of the proceeds settlement are of a settlement

6 of 10 [* 6] FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

ultimately under ultimately the control under the of the control of and the court and the court parties within the parties jurisdiction (see within its jurisdiction Rooney v (see Rooney Second A.R Second A.R Co., 18 NY 1885]). Similarly, 368 [[1885]). NY 368 Similarly, the court in Chesley the court Chesley held not only held not that lower only that lower District District Court's Court's forum forum non conveniens conveniens dismissal did not dismissal did preclude any automatically preclude not automatically of invocation of any invocation ancillary jurisdiction ancillary appellant's application consider the appellant's jurisdiction to consider but also attorney's fees, but application for attorney's that the also that the ability action for forum dismiss an action ability to dismiss forum non conveniens is only non conveniens possible if only possible if the court initially the court had initially had jurisdiction. jurisdiction. 1I Thus, Thus, Plaintiff Plaintiff has facts to support alleged facts sufficiently alleged has sufficiently that it appeared support that or appeared or participated in negotiation participated required by statute. negotiation as required statute. Under Judiciary Under Law S 475, Judiciary Law§ formal notice 475, no formal thus it is immaterial required, thus notice is required, that Plaintiff's immaterial that Plaintiff's Notices of Liens Notices of Liens were notice is only because notice defective because were defective required under only required Judiciary Law under Judiciary Plaintiff is 475-a and Plaintiff Law 475-a not not relying relying on §475-a. Law§S 475 is initiated Judiciary Law s475-a. Judiciary either the initiated by either of an action commencement of the commencement the action or the invocation of invocation of settlement settlement negotiations, S 4475-a whereas § negotiations, whereas only if initiated only 75-a is initiated prior to the if prior commencement of the commencement of action or an action or the invocation of the invocation of settlement negotiations, an attorney settlement negotiations, serves a notice attorney serves of lien upon notice of person the person upon the or or persons persons against against whom whom his or or her client has or her client may have or may or cause claim or have a claim of action. cause of that instance, action. In that the instance, the attorney upon the attorney has a lien upon or cause claim or the claim action from the time of action cause of notice is given. such notice time such given. SCA cites SCA cites language language from from the Engagement Letter, the Engagement paragraphs 2, Letter, paragraphs 3(1), and 2,3(1), 9(d)(I) of and 9(d)(l) the Purchase of the Purchase and Sale and Sale Agreement, Agreement, to support support that under the that under terms of the terms the agreements of the that Plaintiffs agreements that entitlement to any Plaintiff's entitlement any funds can funds can only only arises arises once once money leaves SCA's money leaves hands and are delivered SCA's hands Harbor, which Delevan and Harbor, delivered to 35 Delevan which never happened never happened because SCA never because SCA possessed any never possessed funds. However, any funds. since Plaintiff However, since that it has alleges that Plaintiff alleges has appeared or participated appeared under§S 475, negotiations under settlement negotiations participated in settlement 475, the follow the fund would follow charging lien would the charging created created by the the settlement settlement and and attach to the attach to amount agreed the amount upon the agreed upon instant that the instant the agreement that the made. agreement is made. Contrary to SCA's Contrary Law S 475 may Judiciary Law§ contention, Judiciary SCA's contention, third parties apply to third may apply who knowingly parties who knowingly transfer transfer proceeds of a settlement proceeds of settlement without attorney's liens. accounting for an attorney's without accounting liens. Here, Engagement Letter the Engagement Here, the Letter and Retainer Retainer Agreement defines "amounts Agreement defines "amounts received" proceeds obtained include proceeds received" to include by settlement. obtained by settlement. Additionally, it states Additionally, that that part that states in part attorneys' fee shall "the attorneys' that "the gross amount computed on the gross shall be computed amount recovered," recovered," that "Goldstein. Rikon, that "Goldstein. Houghton. P.C. shall Rikon & Houghton. Rikon, Rikon have exclusive shall have exclusive right negotiate any right to negotiate settlement on behalf settlement of the behalf of Client," and the Client," and that "said attorneys' that "said compensation and attorneys' compensation disbursements are to be and disbursements paid when the paid as and when award is paid the award the condemnor." paid by the condemnor." Furthermore, Paragraph Furthermore, 3(1)(t) of Paragraph 3(l)(t) Purchase and Sale Agreement of the Purchase states that: Agreement states that: "On the "On Closing Date, the Closing the Property Date, the conveyed ... shall be conveyed Property shall form for proper form ... in proper recording ... so as to recording ... to Purchaser convey to to convey marketable and good, marketable Purchaser good, insurable and insurable fee simple simple title title to the Property, subject the Property, only to the following subject only exceptions to following exceptions

I In Chesley, 1 Chesley, the the court court did not not dismiss dismiss the the matter the grounds matter on the that it lost grounds that jurisdiction over lost jurisdiction over the settlement funds the settlement funds to the the court court in India, India, but but rather rather because because it would have been would have abuse of been an abuse discretion for the of discretion the lower district court lower district have court to have considered the considered application in view petitioner's fee application the petitioner's of the view of fact that the fact they never that they appeared on behalf never appeared of any behalf of parties in the any parties Indian litigation Indian litigation nor nor had had they made an application they made payment of application for payment the settlement of the India beforehand. funds in India settlement funds beforehand.

7 of 10 [* 7] FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

title: liens against title: liens of the sale proceeds of against the proceeds Property or of the Property sale of against or against Seller's files relating Seller's Property, including relating to the Property, limited to liens not limited but not including but filed liens filed or or asserted Seller's [prior by Seller's asserted by however which counsel]. ....however [prior counsel). lien(s) shall which lien(s) be shall be treated set forth treated as set below." Article 4 below." forth in Article of the Paragraph 4 of Paragraph Purchase and the Purchase Agreement states Sale Agreement and Sale that: states that: "If, "If, on the the Closing Date, the Closing Date, affected by any Property is affected the Property which, any lien which, pursuant the provisions pursuant to the of this provisions of Agreement, Seller this Agreement, required to Seller is required discharge or satisfY, discharge or provisions of satisfy, the provisions below shall Section 11 below ofSection applicable shall be applicable respect to such with respect with lien." such lien." "The foregoing "The notwithstanding, Seller foregoing notwithstanding, Seller shall defend and indemnify, defend shall indemnify, hold- and hold- harmless harmless the Purchaser from the "attorneys' the Purchaser "attorneys' lien" noted in Sections lien" noted 3 l(t) Sections 3I(t) and 5 (A)(x) and (A)(x) herein, herein, including limitation, attorneys' without limitation, including without fees and attorneys' fees expenses incurred in the expenses incurred of such discharge of the discharge such lien. The provisions of The provisions the of the preceding sentence shall preceding sentence Closing." survive the Closing." shall survive S(A)(x) of Paragraph 5(A)(x) Paragraph the Purchase of the Agreement states Sale Agreement Purchase and Sale that: states that: "To Seller's "To Seller's knowledge, there are no claims, knowledge, there litigation or claims, litigation proceedings or or proceedings governmental investigations pending governmental investigations the knowledge pending or, to the of Seller, knowledge of Seller, threatened writing against threatened in writing relating to Seller against or relating Property that the Property Seller or the could that could have material adverse have a material effect on Seller's adverse effect Seller's title Property, except the Property, title to the for except for claims, litigation or claims, litigation now or liens now or liens filed or asserted hereafter filed or hereafter Seller's by Seller's asserted by prior prior counsel, counsel, Goldstein, Goldstein, Rikon, Rikon & Levi, Rikon, Rikon with respect P.C., with Levi, p,e, the · respect to the. proceeds of proceeds Property or of the Property sale of of the sale or Seller's files relating Seller'sfiles Property relating to the Property (or both), both), which which Purchaser acknowledges have Purchaser acknowledges disclosed by been disclosed have been Seller, by Seller, and and which which nevertheless will be treated nevertheless will forth in Article set forth treated as set hereof." Article 4 hereof." Paragraph 11 Paragraph 11 of Purchase and the Purchase of the Agreement states Sale Agreement and Sale that: part that: states in part "If the date "If on the of Closing date of there are any other Closing there liens or encumbrances other liens encumbrances (besides property taxes, (besides property assessments, water taxes, assessments, sewer charges), water and sewer which charges), which Seller obligated to pay Seller is obligated discharge under pay and discharge terms of the terms under the this of this Agreement, Seller may Agreement, Seller portion of may use any portion balance of the balance of the of the Purchase the Purchase Price to satisfy Price satisfy the ... " same ... the same Plaintiff Plaintiff sent sent a copy copy of Notice of of a Notice Lien and of Lien Amended Notice and an Amended of Lien Notice of April 11, SCA on April Lien to SCA 2022, and a copy 2022, copy of of an Amended Notice of Amended Notice title company the title of Lien to the 2022, and according April 21, 2022, company on April according to the the Closing Settlement Statement Closing Settlement Statement dated 2022, SCA May 26, 2022, dated May paid a total SCA paid of $32,730,000 total of title $32,730,000 to the title

8 of 10 [* 8] FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

company, company, of of which which "21 and and 35 Delevan Delevan LLC" received $21,669,999.18 LLC" received $21,669,999.18 from the title from the after company after title company apportionment. apportionment. Accordingly, Accordingly, the documentary evidence submitted documentary evidence does not submitted does refute allegations conclusively refute not conclusively that allegations that Defendants not Defendants not only only knew knew about about Plaintiff's charging lien but paid Plaintiff's charging the settlement out the paid out settlement proceeds after the proceeds after lien arose arose and and attached attached to the the proceeds proceeds without without paying Plaintiff and while paying Plaintiff SCA states while SCA states that was Plaintiff was that Plaintiff fired for cause, cause, which which would would eliminate eliminate its entitlement SCA's bare charging lien, SCA's entitlement to a charging conclusory statement bare conclusory statement without without more insufficient to rebut more in insufficient rebut Plaintiff's trigger a hearing claim or to trigger Plaintiffs claim the issue. hearing on the issue. When a party When party moves moves to dismiss pursuant to CPLR complaint pursuant dismiss a complaint S 321 l(a)(7), CPLR § standard is the standard I(a)(7), the whether whether the pleading states a cause pleading states cause of of action, n·ot whether action, riot proponent of whether the proponent of the cause of pleading has a cause the pleading of action (Leon action (Leon v. v. Martinez, NY2d 83, 87 [1994]; Martinez, 84 NY2d Skefalidis v China [1994]; Skefalidis Pagoda NY, Inc., China Pagoda A.O. 3d 925 210 AD. Inc., 210 [2d Dept. 2022]); 2022]); Oluwo Oluwo v Sutton, 206 A.D.3d Sutton, 206 Dept. 2022]; A.D.3d 750 [2d Dept. Sokol v Leader, 2022]; Sokol A.D.3d 1180 [2d Leader, 74 AD.3d Dept. Dept. 2010]). 2010]). Whether Whether a plaintiff plaintiff can can ultimately ultimately establish allegations is not establish its allegations part of not part calculus in the calculus of the determining a motion determining motion to dismiss dismiss (Eskridge Diocese of (Eskridge v Diocese Brooklyn, 210 A.D.3d of Brooklyn, Dept. 2022]; AD.3d 1056 [2d Dept. 2022]; Zurich Zurich American American Insurance City of Company v City Insurance Company of New A.D.3d 1145 [2d Dept. New York, 176 AD.3d EBC I Inc. v 2019]; EBC Dept. 2019]; Goldman, Sachs Goldman, NY3d [2005]). Sachs & Co., 5 NY3d [2005]). On a motion motion to dismiss dismiss a complaint complaint pursuant S 32 CPLR § pursuant to CPLR l l(a)(7), 3211 the burden (a)(7), the never shifts burden never shifts to the non-moving party non-moving party to rebut rebut a defense defense asserted moving party asserted by the moving (Sokol at 1181; party (Sokol Rove/lo v Orofino 1181; Rovello Orofino Realty Realty Co. Inc., Inc., 40 NY2d 970 [1976]). NY2d 970 [1976]). CPLR S 3211 allows CPLR § submit affidavits, plaintiff to submit allows a plaintiff but it does not affidavits, but oblige him or oblige or her her to do so on penalty penalty of of dismissal Sokol at 1181 dismissal (Id.; Sokol ). Affidavits 1181). received for a may be received Affidavits may limited purpose limited only, serving purpose only, serving normally remedy defects normally to remedy the complaint defects in the and such complaint and not to affidavits are not such affidavits be examined examined for the purpose of the purpose of determining determining whether evidentiary support there is evidentiary whether there support for the pleading (Id.; the pleading Rovello 635; Nonon Rove/lo at 635; 827). Thus, Nonon at 827). Thus, a plaintiff plaintiff will not be penalized will not because he has penalized because made an not made has not evidentiary showing in support evidentiary showing support of complaint. of its complaint. Unlike on a motion Unlike motion for summary summary judgment, where the judgment, where searches the court searches the court assesses the record and assesses the record sufficiency of sufficiency of evidence, evidence, on a motion motion to dismiss, dismiss, the court merely examines court merely examines the adequacy of the adequacy of the pleadings the pleadings (Davis v. (Davis v. Boeheim, Boeheim, 24 NY3d 262, 268 NY3d 262, 268 [2014 [2014]). The appropriate ]). The test of appropriate test sufficiency of of the sufficiency pleading is of a pleading whether such pleading whether such gives sufficient pleading gives notice of sufficient notice transactions, occurrences, of the transactions, series of occurrences, or series transactions or of transactions occurrences intended occurrences intended to be proved proved and and whether the requisite whether the elements of requisite elements any cause of any of action cause of known to our action known our law can be discerned discerned from its averments averments ((V. Pools, Inc. v. Groppa Pools, V. Groppa v. Massello, AD3d 722, 723 [2d Dept Masse/lo, 106 AD3d Dept 2013]; Moore Johnson, 14 Moore v Johnson, Dept 1989]). AD2d 621 [2d Dept 1477 AD2d 1989]). constructive bailment A constructive one implied bailment is one comes into lawful one comes when one implied by law when possession of lawful possession of another's another's personal personal property, property, other other than contract (Martin mutual contract than by mutual (Martin v Briggs, AD2d 192 [1st Briggs, 235 AD2d Dept. 1997]; Mack Dept. Mack v Davidson, AD2d 1027 Davidson, 55 AD2d 1977]). It is the Dept. 1977]). 1027 [4th Dept. of lawful element of the element lawful possession, possession, however created, and the however created, duty to account the duty the property thing as the account for the thing of another property of that another that

9 of 10 [* 9] FILED: KINGS COUNTY CLERK 01/05/2024 10:48 AM INDEX NO. 513884/2022 NYSCEF DOC. NO. 36 RECEIVED NYSCEF: 01/05/2024

, ' creates creates the the bailment bailment (Martin (Martin at 197; Foulke Foulke v New Railroad Co., 228 Consolidated Railroad New York Consolidated NY 269 228 NY [1920]). [l 920]). A bailment bailment may arise from the may arise bare fact of the bare of the thing coming the thing the actual coming into the possession actual possession and control control of of a person person fortuitously, fortuitously, or mistake as to the duty or by mistake ability of or ability duty or recipient to the recipient of the affect affect the the purpose purpose contemplated contemplated by the the absolute Phelps v People, owner (Id.; Phelps absolute owner 334 [1878]). NY 334 People, 72 NY [1878]). Additionally, Additionally, taking taking lawful lawful possession without present possession without appropriate creates intent to appropriate present intent bailment creates a bailment (Id.; Seaboard Seaboard Sand Morgan Towing Gravel Corp. v Morgan Sand & Gravel F .2d 399 Corp., 154 F.2d Towing Corp., Cir. 1946]). 399 [2d Cir. 1946]). Here, Here, Plaintiff Plaintiff has has sufficiently stated a cause sufficiently stated action for a constructive of action cause of inter bailment inter constructive bailment alia alia paragraphs though 47 of paragraphs 42 though Complaint. Verified Complaint. of its Verified Accordingly, hereby, Accordingly, it is hereby, ORDERED, ORDERED, that that New New York York City School Construction City School Authority's motion Construction Authority's (Motion Seq. motion (Motion 1) to dismiss dismiss Goldstein, Goldstein, Rikon, Rikon, Rikon, Levi, P.C.'s Rikon, & Levi, Complaint pursuant Verified Complaint P.C.'s Verified CPLR SS pursuant to CPLR §§ 3211(a)(l) 321 (a)(7) is denied. l(a)(I) and (a)(7) denied. This This constitutes constitutes the decision and the decision of the order of and order court. the court.

Hon. I Hon. r' J.S.C. Joseph J.S.C. r· Joseph Ho . ngrid Joseph ,..,.. Ho Joseph Supreme Court Supreme Justice Court Justice

10 of 10 [* 10]