Hawkins, Delafield & Wood, LLP v. RBNB 67 Wall Street Owner LLC

7 Misc. 3d 753
CourtNew York Supreme Court
DecidedMarch 18, 2005
StatusPublished

This text of 7 Misc. 3d 753 (Hawkins, Delafield & Wood, LLP v. RBNB 67 Wall Street Owner LLC) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hawkins, Delafield & Wood, LLP v. RBNB 67 Wall Street Owner LLC, 7 Misc. 3d 753 (N.Y. Super. Ct. 2005).

Opinion

OPINION OF THE COURT

Edward H. Lehner, J.

The prime issue raised on this motion by plaintiff for injunctive relief is whether the terms of the subject lease, principally [754]*754the clause that states that the building “will be run as a first class office building,” bar the defendant from converting the second to tenth floors to residential occupancy.

Plaintiff, a prominent law firm, has been a tenant of the building at 67 Wall Street since 1942, presently occupying the eleventh to fifteenth floors. Defendant acquired the building in March 2004 and previously had made known its intention to convert the lower floors to residential use. In an estoppel certificate it issued to defendant in February 2004, plaintiff stated that a conversion for use other than as a first-class office building “would constitute a default under the lease.” In the spring of 2004, a construction loan was obtained by defendant and in October 2004 it filed an application with the Buildings Department for permission to perform the conversion, which permit was approved on December 21, 2004.

The crucial provision of the present lease is section 9E thereof, which is part of a section dealing with “expense escalation,” and which provides that “the Building will be run as a first-class office building in the Borough of Manhattan and in a reasonable and prudent manner.” The explanation as to the origin of this clause, which first became a part of plaintiffs lease in 1973, is set forth in the affidavits of W. Cullen MacDonald sworn to December 22, 2004 and John P Fenner sworn to January 31, 2005, wherein they state that in 1973 plaintiff was concerned that space in the building was occupied by the New York City Taxi and Limousine Commission. MacDonald avers that plaintiffs clients and employees “had to ride elevators and share the lobby with disgruntled taxi drivers who had just been subjected to disciplinary action by the Commission and were acting out through unsavory and violent conduct” (11 15). However, this background information is not helpful in interpreting the aforesaid clause as the appropriate issue (as noted in paragraph 38 of the MacDonald affidavit) in determining what is a “first class” office building deals primarily with the maintenance and service provided, not the quality of the tenancy. Hence, the court, near the conclusion of the extensive oral argument, suggested that, since the papers did not appear to raise a triable issue of fact with respect to the intent of section 9E, the parties agree to convert the motion to one for summary judgment. Alternatively, the court proposed an immediate trial. However, both proposals were rejected by plaintiff as it indicated that it intended to amend its complaint to assert other lease violations.

[755]*755' The motion before the court is to enjoin defendant from taking any action (a) which would violate the plaintiffs lease, and (b) to convert the building to residential use. Seeking to enjoin an unspecified activity is not justiciable and hence the first above-referred-to request to direct defendant not to violate the lease is denied without prejudice to any future application to enjoin any threatened or actual specified activity. With respect to the latter request, to be entitled to the relief £‘plaintiff! ] had to show a probability of success, danger of irreparable injury in the absence of an injunction, and a balance of the equities in [its] favor” (Aetna Ins. Co. v Capasso, 75 NY2d 860, 862 [1990]).

It has been said that a preliminary injunction is a drastic remedy that “require [s] a clear showing of likelihood of ultimate success on the merits” (Faberge Intl. v Di Pino, 109 AD2d 235, 240 [1st Dept 1985]; see also, Credit Index v RiskWise Intl., 282 AD2d 246 [1st Dept 2001]; Scotto v Mei, 219 AD2d 181 [1st Dept 1996]; SportsChannel Am. Assoc. v National Hockey League, 186 AD2d 417 [1st Dept 1992]). However, “the existence of a factual dispute will not bar the granting of a preliminary injunction if one is necessary to preserve the status quo and the party to be enjoined will suffer no great hardship as a result of its issuance” (Mr. Natural v Unadulterated Food Prods., 152 AD2d 729, 730 [2d Dept 1989]; see also, Sau Thi Ma v Lien, 198 AD2d 186 [1st Dept 1993]).

Both parties agree that the law relating to restrictive covenants governs the interpretation of the purported restriction set forth in section 9E. In Ewing v Watson (15 AD3d 340, 343 [2d Dept 2005]), the Court summarized the rules applicable to restrictive covenants as follows:

“ £[T]he law has long favored free and unencumbered use of real property, and covenants restricting use are strictly construed against those seeking to enforce them’ (Witter v Taggart, [78 NY2d at 237]; see Huggins v Castle Estates, 36 NY2d 427, 430 [1975]). £[A]ny ambiguity in a covenant restricting use must be strictly construed against those seeking to enforce it, and the court must interpret the covenant to limit, rather than extend, its restriction’ (9394 LLC v Farris, 10 AD3d 708 [2004]). £[W]here the language used in a restrictive covenant is equally susceptible of two interpretations, the less restrictive interpretation must be adopted’ (Ludwig v Chautauqua Shores Improvement Assn., 5 AD3d 1119, 1120 [2004]).”

[756]*756The Court in Greek Peak v Grodner (75 NY2d 981, 982 [1990]) held that “a party seeking to enforce a restriction on land use must prove, by clear and convincing evidence, the scope, as well as the existence, of the restriction.”

In Kem Cleaners v Shaker Pine (217 AD2d 787, 788 [3d Dept 1995]), it was stated that where a “lease has express provisions which limit and restrict the use of a building to a specific purpose, such provisions will be given effect . . . [but] [s]ince such limitations are not generally favored, they will not be extended by implication beyond the terms of the restriction and we must therefore glean the intent of the parties by an examination of the entire lease agreement.”

In a case which each of the parties contends supports its position, Herman Miller, Inc. v Thom Rock Realty Co., L.P. (46 F3d 183 [2d Cir 1995]), the landlord covenanted in the subject lease that the center it was developing “shall be constructed as a first class commercial building intended to be used for showrooms and other related uses.” (At 185.) The plaintiff tenant’s lease, similar to the leases of all other tenants in the center, provided that it could use the premises “only for showroom display and sale of contract furniture.” (Id.) When an economic downturn caused other furniture dealers to leave the center and the defendant landlord commenced leasing space to tenants engaged in other businesses, plaintiff instituted action seeking a declaration that it is relieved of its lease obligations and entitled to damages.

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Related

Greek Peak, Inc. v. Grodner
555 N.E.2d 906 (New York Court of Appeals, 1990)
Huggins v. Castle Estates Inc.
330 N.E.2d 48 (New York Court of Appeals, 1975)
Aetna Insurance v. Capasso
552 N.E.2d 166 (New York Court of Appeals, 1990)
Ludwig v. Chautauqua Shores Improvement Ass'n
5 A.D.3d 1119 (Appellate Division of the Supreme Court of New York, 2004)
9394 LLC v. Farris
10 A.D.3d 708 (Appellate Division of the Supreme Court of New York, 2004)
Ewing v. Watson
15 A.D.3d 340 (Appellate Division of the Supreme Court of New York, 2005)
Faberge International, Inc. v. Di Pino
109 A.D.2d 235 (Appellate Division of the Supreme Court of New York, 1985)
Mr. Natural, Inc. v. Unadulterated Food Products, Inc.
152 A.D.2d 729 (Appellate Division of the Supreme Court of New York, 1989)
SportsChannel America Associates v. National Hockey League
186 A.D.2d 417 (Appellate Division of the Supreme Court of New York, 1992)
Sau Thi Ma v. Lien
198 A.D.2d 186 (Appellate Division of the Supreme Court of New York, 1993)
Kem Cleaners, Inc. v. Shaker Pine, Inc.
217 A.D.2d 787 (Appellate Division of the Supreme Court of New York, 1995)
Scotto v. Mei
219 A.D.2d 181 (Appellate Division of the Supreme Court of New York, 1996)
Credit Index, L. L. C. v. RiskWise International L. L. C.
282 A.D.2d 246 (Appellate Division of the Supreme Court of New York, 2001)

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Bluebook (online)
7 Misc. 3d 753, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hawkins-delafield-wood-llp-v-rbnb-67-wall-street-owner-llc-nysupct-2005.