White Plains NY v. A & S Galleria
Opinion
5(&200(1'(' )25 )8//7(;7 38%/,&$7,21 3XUVXDQW WR 6L[WK &LUFXLW 5XOH
(/(&7521,& &,7$7,21 )(' $SS 3 WK &LU )LOH 1DPH D S
81,7('67$7(6&28572)$33($/6 )257+(6,;7+&,5&8,7 BBBBBBBBBBBBBBBBB
,QUH )('(5$7(' ; '(3$570(17 6725(6 ,1& $ 6 *$//(5,$ 5($/ 1RV (67$7( ,1& 'HEWRU ! BBBBBBBBBBBBBBBBBBBBBBB &,7< 2) :+,7( 3/$,16 1(: <25. 3ODLQWLII$SSHOODQW Y $ 6 *$//(5,$ 5($/ (67$7( ,1& 'HIHQGDQW$SSHOOHH 1 $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH6RXWKHUQ'LVWULFWRI2KLRDW&LQFLQQDWLDQG $SSHDOIURPWKH%DQNUXSWF\$SSHOODWH3DQHO RIWKH6L[WK&LUFXLW 1R n6DQGUD6%HFNZLWK'LVWULFWsXGJH 1R n%XUWRQ3HUOPDQ%DQNUXSWF\sXGJH $UJXHG $SULO
,QUH)HGHUDWHG'HSjW 1RV 6WRUHV $ 6*DOOHULD
'HFLGHGDQG)LOHG 1RYHPEHU %HIRUH %2**6DQG&/$<&LUFXLWsXGJHV *:,1 'LVWULFWsXGJH BBBBBBBBBBBBBBBBB &2816(/ $5*8(' sRKQ$UWKXU6FKXK6&+8+ *2/'%(5* &LQFLQQDWL2KLRIRU$SSHOODQW7RGG66ZDWVOHUs21(6 '$<5($9,6 32*8(&ROXPEXV2KLRIRU$SSHOOHH 21%5,() sRKQ$UWKXU6FKXK6&+8+ *2/'%(5* &LQFLQQDWL2KLRIRU$SSHOODQW7RGG66ZDWVOHUs21(6 '$<5($9,6 32*8(&ROXPEXV2KLRIRU$SSHOOHH BBBBBBBBBBBBBBBBB 23,1,21 BBBBBBBBBBBBBBBBB *:,1'LVWULFWsXGJH:LWKWKHVHDSSHDOVFRQVROLGDWHG IRUSXUSRVHVRIGHFLVLRQWKH&RXUWLVDVNHGWRGHFLGHZKHWKHU FHUWDLQ UHDO SURSHUW\ WD[HV DUH SURSHUO\ FRQVLGHUHG DGPLQLVWUDWLYHH[SHQVHVXQGHU86& E % L RI WKH %DQNUXSWF\ &RGH 7KH &RXUW LV DOVR DVNHG WR GHFLGH ZKHWKHU1HZ 7KH +RQRUDEOH sDPHV 6 *ZLQ 8QLWHG 6WDWHV 'LVWULFW sXGJH IRU WKH 1RUWKHUQ 'LVWULFW RI 2KLR VLWWLQJ E\ GHVLJQDWLRQ ,QUH)HGHUDWHG'HSjW 1RV 1RV ,QUH)HGHUDWHG'HSjW 6WRUHV $ 6*DOOHULD 6WRUHV $ 6*DOOHULD ,9 UHFHLYHSULRULW\DVDSUHSHWLWLRQLQWHUHVWLQWKHUHDOSURSHUW\ WKDWZDVFDSDEOHRIEHLQJSHUIHFWHGSRVWSHWLWLRQE\RSHUDWLRQ 7KHVHFRQGDSSHDOEHIRUHWKH&RXUWZDVDOWHUQDWLYHEDVHG RIDJHQHUDOO\DSSOLFDEOHVWDWHODZ XSRQDSRVVLELOLW\WKDWWKHSURSHUW\WD[HVZHUHQRWDOORZDEOH DV DGPLQLVWUDWLYH H[SHQVHV $W RUDO DUJXPHQW ERWK SDUWLHV 7KH 86 %DQNUXSWF\ &RXUW IRU WKH 6RXWKHUQ 'LVWULFW RI DJUHHGWKDWLQWKHHYHQWZHIRXQGWKHWD[HVWREHFROOHFWDEOH 2KLRGHQLHGWKH&LW\jVDSSOLFDWLRQWRKDYHWKHWD[HVSDLGDV DV DQ DGPLQLVWUDWLYH H[SHQVH DV ZH KDYH GRQH WKHQ WKLV DGPLQLVWUDWLYHH[SHQVHVXQGHU86& E % L E\ DOWHUQDWLYH TXHVWLRQ VKRXOG QRW EH DQVZHUHG 7KXV ZH RSHUDWLRQ RI 86& D % 7KH 86 'LVWULFW H[SUHVVQRRSLQLRQDVWRZKHWKHUDQLQWHUHVWLQSURSHUW\XQGHU &RXUWIRUWKH6RXWKHUQ'LVWULFWRI2KLRDIILUPHGWKHGHFLVLRQ 86& E LVFUHDWHGXQGHU1HZ
Free access — add to your briefcase to read the full text and ask questions with AI
5(&200(1'(' )25 )8//7(;7 38%/,&$7,21 3XUVXDQW WR 6L[WK &LUFXLW 5XOH
(/(&7521,& &,7$7,21 )(' $SS 3 WK &LU )LOH 1DPH D S
81,7('67$7(6&28572)$33($/6 )257+(6,;7+&,5&8,7 BBBBBBBBBBBBBBBBB
,QUH )('(5$7(' ; '(3$570(17 6725(6 ,1& $ 6 *$//(5,$ 5($/ 1RV (67$7( ,1& 'HEWRU ! BBBBBBBBBBBBBBBBBBBBBBB &,7< 2) :+,7( 3/$,16 1(: <25. 3ODLQWLII$SSHOODQW Y $ 6 *$//(5,$ 5($/ (67$7( ,1& 'HIHQGDQW$SSHOOHH 1 $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH6RXWKHUQ'LVWULFWRI2KLRDW&LQFLQQDWLDQG $SSHDOIURPWKH%DQNUXSWF\$SSHOODWH3DQHO RIWKH6L[WK&LUFXLW 1R n6DQGUD6%HFNZLWK'LVWULFWsXGJH 1R n%XUWRQ3HUOPDQ%DQNUXSWF\sXGJH $UJXHG $SULO
,QUH)HGHUDWHG'HSjW 1RV 6WRUHV $ 6*DOOHULD
'HFLGHGDQG)LOHG 1RYHPEHU %HIRUH %2**6DQG&/$<&LUFXLWsXGJHV *:,1 'LVWULFWsXGJH BBBBBBBBBBBBBBBBB &2816(/ $5*8(' sRKQ$UWKXU6FKXK6&+8+ *2/'%(5* &LQFLQQDWL2KLRIRU$SSHOODQW7RGG66ZDWVOHUs21(6 '$<5($9,6 32*8(&ROXPEXV2KLRIRU$SSHOOHH 21%5,() sRKQ$UWKXU6FKXK6&+8+ *2/'%(5* &LQFLQQDWL2KLRIRU$SSHOODQW7RGG66ZDWVOHUs21(6 '$<5($9,6 32*8(&ROXPEXV2KLRIRU$SSHOOHH BBBBBBBBBBBBBBBBB 23,1,21 BBBBBBBBBBBBBBBBB *:,1'LVWULFWsXGJH:LWKWKHVHDSSHDOVFRQVROLGDWHG IRUSXUSRVHVRIGHFLVLRQWKH&RXUWLVDVNHGWRGHFLGHZKHWKHU FHUWDLQ UHDO SURSHUW\ WD[HV DUH SURSHUO\ FRQVLGHUHG DGPLQLVWUDWLYHH[SHQVHVXQGHU86& E % L RI WKH %DQNUXSWF\ &RGH 7KH &RXUW LV DOVR DVNHG WR GHFLGH ZKHWKHU1HZ 7KH +RQRUDEOH sDPHV 6 *ZLQ 8QLWHG 6WDWHV 'LVWULFW sXGJH IRU WKH 1RUWKHUQ 'LVWULFW RI 2KLR VLWWLQJ E\ GHVLJQDWLRQ ,QUH)HGHUDWHG'HSjW 1RV 1RV ,QUH)HGHUDWHG'HSjW 6WRUHV $ 6*DOOHULD 6WRUHV $ 6*DOOHULD ,9 UHFHLYHSULRULW\DVDSUHSHWLWLRQLQWHUHVWLQWKHUHDOSURSHUW\ WKDWZDVFDSDEOHRIEHLQJSHUIHFWHGSRVWSHWLWLRQE\RSHUDWLRQ 7KHVHFRQGDSSHDOEHIRUHWKH&RXUWZDVDOWHUQDWLYHEDVHG RIDJHQHUDOO\DSSOLFDEOHVWDWHODZ XSRQDSRVVLELOLW\WKDWWKHSURSHUW\WD[HVZHUHQRWDOORZDEOH DV DGPLQLVWUDWLYH H[SHQVHV $W RUDO DUJXPHQW ERWK SDUWLHV 7KH 86 %DQNUXSWF\ &RXUW IRU WKH 6RXWKHUQ 'LVWULFW RI DJUHHGWKDWLQWKHHYHQWZHIRXQGWKHWD[HVWREHFROOHFWDEOH 2KLRGHQLHGWKH&LW\j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mDULVHlDVWKHSODLQODQJXDJHRI L SUHFOXGHVLWIURPDSSO\LQJWRWKHWD[HVLQWKHLQVWDQWFDVH 7KH&LW\DQGWKH&LW\RI:KLWH3ODLQV6FKRRO'LVWULFW WKH m6FKRRO 'LVWULFWl XVH VLPLODU WD[ DVVHVVPHQW SURFHGXUHV )RUDWD[FODLPWREHWUHDWHGDVDULVLQJSUHSHWLWLRQXQGHU 7KH&LW\DQGWKH6FKRRO'LVWULFWXWLOL]HDILVFDO\HDUWKDWUXQV L D FODLP PXVW ILUVW EH HOLJLEOH IRU HLJKWK SULRULW\ IURPsXO\RIHDFK\HDUWRWKHIROORZLQJsXQH8QGHU XQGHU D 7REHDZDUGHGHLJKWKSULRULW\DFODLP 1HZ 7KH&LW\HQDFWVLWVEXGJHWRQRUEHIRUH0D\6HH:KLWH UH &DUOLVOH &RXUW ,QF %5 %DQNU ''& IXUWKHU 3ODLQV1<&RGH % &RQFXUUHQWO\ZLWKSDVVLQJD UHDVRQHG EXGJHWWKH&LW\FDXVHVVXIILFLHQWPRQH\m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jW 1RV 1RV ,QUH)HGHUDWHG'HSjW 6WRUHV $ 6*DOOHULD 6WRUHV $ 6*DOOHULD mDVVHVVHG RQ DOO UHDO HVWDWH LQ WKH FLW\l RQ 0D\ EXGJHW\HDUlVRWKDWWKHEXGJHWLVEDODQFHG:KLWH3ODLQV ZKHQWKH&RPPRQ&RXQFLORI:KLWH3ODLQVDGRSWHGWKHFLW\jV 1< &RGH ' ,Q WKLV FDVH WKH &LW\ DGRSWHG LWV EXGJHWIRUWKHXSFRPLQJILVFDO\HDUEHJLQQLQJsXO\ EXGJHWRQ0D\ $OWKRXJK WKH YDOXDWLRQ SURFHVV ZDV XQGHUZD\ WZR ZHHNV SULRUWRWKHILOLQJRIWKHEDQNUXSWF\SHWLWLRQ1HZ 7KHWD[HVDUHSD\DEOHLQLQVWDOOPHQWVDQGLIQRWSDLGEHIRUH ,Q WXUQ WKH &LW\ DUJXHV WKDW mDVVHVVHGl XQGHU WKHGDWHZKHQGXHLQWHUHVWLVmLQFOXGHGLQDQGGHHPHGSDUWRI D % KDV WKH VDPH PHDQLQJ DV mLQFXUUHGl XQGHU WKHXQSDLGWD[l1<5HDO3URS7D[/DZ E % L 7KLVSRVLWLRQKDVEHHQDGRSWHGE\DIHZ FRXUWV 6HH HJ ,Q UH *DUILQFNHOV %5 DW o $VLVWKHFDVHZLWKWKHFLW\WD[HVWKHVFKRROWD[LVDOVRERWK QRWLQJWKDWWKHFULWLFDOIRFXVXQGHU D % LVZKHQWKH LQUHPDQGLQSHUVRQDP7KHOHY\RIVFKRROWD[HVmVKDOOEH SURSHUW\ LQHVFDSDEO\ EHFRPHV VXEMHFW WR WKH WD[ DV WKLV GHHPHGDVDJDLQVWWKHUHDOSURSHUW\LWVHOIl1<5HDO3URS LQWHUSUHWDWLRQ SUHVHUYHV &RQJUHVVjV LQWHQW WKDW WKH GHEWRUjV 7D[/DZ7KHLQSHUVRQDPQDWXUHRIWKHWD[H[LVWV HVWDWHEHOLDEOHRQO\IRUWKRVHWD[HVWKHHVWDWHLQFXUUHG ,QUH EHFDXVHWKHRZQHURIUHDOSURSHUW\LVSHUVRQDOO\UHVSRQVLEOH 3UDLULH 0LQLQJ ,QF %5 %DQNU ' .DQ IRUDQ\WD[OHYLHGDJDLQVWWKDWSURSHUW\6HH1<5HDO3URS m>7@KH&RXUWLVFRQYLQFHGWKDW&RQJUHVVLQWHQGHGIRU 7D[/DZ DOOSURSHUW\WD[HVFRPLQJGXHSRVWSHWLWLRQWRTXDOLI\IRUHLWKHU WKHILUVWRUHLJKWKSULRULW\ 7KLVSXUSRVHLVEHVWVHUYHGE\ 2Q sDQXDU\ $ 6 *DOOHULD ILOHG D &KDSWHU FRQVWUXLQJ µLQFXUUHGj LQ WR PHDQ WKH VDPH WKLQJ DV EDQNUXSWF\ SHWLWLRQ IRU UHOLHI 7KH EDQNUXSWF\ FRXUW µDVVHVVHGjLQ D % l HVWDEOLVKHG$XJXVW DVWKHFODLPVEDUGDWH7KH&LW\ ILOHG D WLPHO\ SURRI RI FODLP IRU FHUWDLQ WD[HV DQG ZDWHU :HEHOLHYHWKHSRVLWLRQVWDNHQE\WKHGLVWULFWFRXUWDQGWKH FKDUJHV7KHGHEWRUjVHVWDWHSDLGWKHVHFODLPVIROORZLQJSODQ &LW\ZLWKUHVSHFWWRWKHGHILQLWLRQRImDVVHVVHGlDUHHVVHQWLDOO\ FRQILUPDWLRQ7KH&LW\GLGQRWILOHDSURRIRIFODLPIRUWKH WKH VDPH $V GHWDLOHG LQ WKH SUHYLRXV SDUW DQ H[SHQVH LV FLW\DQGVFKRROWD[HVDWLVVXHLQWKLVDSSHDO7KH&LW\DUJXHV LQFXUUHG ZKHQ LW DFFUXHV DQG OLDELOLW\ LV IL[HG )RU DOO WKHWD[HVZHUHDGPLQLVWUDWLYHH[SHQVHVIRUZKLFKQRSURRIRI SUDFWLFDOSXUSRVHVZKHQmOLDELOLW\LVIL[HGlLVWKHVDPHHYHQW FODLPZDVUHTXLUHG&HUWDLQFRXQW\WD[HVDULVLQJIURPWKH DVWKHGLVWULFWFRXUWjVKROGLQJWKDWDWD[LVmDVVHVVHGlZKHQ VDPH DVVHVVPHQW UROO DV WKH WD[HV DW LVVXH ZHUH SDLG mWKHHQWLW\LVPDGHOLDEOHIRU>WKHWD[@l7KHGLVWULFWFRXUW SRVWSHWLWLRQE\WKHGHEWRUjVHVWDWHZLWKRXWSURRIRIDFODLP KHOGDJDLQVWWKH&LW\EHFDXVHLWPLVLQWHUSUHWHG1HZ 2QH VFKRRO RI WKRXJKW LV LQ OLQH ZLWK WKH SRVLWLRQ ZHUHLQFXUUHGE\WKHGHEWRUjVHVWDWHXQGHU E % L HVVHQWLDOO\ HVSRXVHG E\ >WKH &LW\@ $ WD[ LV QRW EHFDXVHWKHWD[HVLQTXHVWLRQZHUHQRWmDVVHVVHGlDFFRUGLQJ mDVVHVVHGl ZLWKLQ WKH PHDQLQJ RI D XQWLO DOO WR D % XQWLO DIWHU WKH EDQNUXSWF\ SHWLWLRQ ZDV WKLQJV QHFHVVDU\ WR FUHDWH WKH WD[ OLDELOLW\ KDYH ILOHG&RQFXUUHQWZLWKWKHILOLQJRIWKHPRWLRQWRUHFRYHUWKH RFFXUUHGnGHWHUPLQDWLRQ RI WKH SURSHUW\jV YDOXH WD[HV DV DQ DGPLQLVWUDWLYH H[SHQVH WKH &LW\ LQVWLWXWHG DQ GHWHUPLQDWLRQRIDSSOLFDEOHWD[UDWHDQGDWWDFKPHQWRID DGYHUVDU\SURFHHGLQJLQEDQNUXSWF\FRXUW,QWKHDGYHUVDU\ OLHQRQWKHSURSHUW\7KHRWKHUVFKRRORIWKRXJKWDQG SURFHHGLQJWKH&LW\WRRNWKHDOWHUQDWLYHSRVLWLRQWKDWLIWKH WKH RQH DGRSWHG E\ WKH &RXUW KHUH LV WKDW D WD[ LV WD[HV ZHUH QRW DGPLQLVWUDWLYH H[SHQVH FODLPV EHFDXVH RI mDVVHVVHGl RQ WKH GDWH WKH HQWLW\ LV PDGH OLDEOH IRU LW SUHSHWLWLRQDVVHVVPHQWWKHQWKH&LW\KDGDQLQWHUHVWLQWKH UHJDUGOHVVRIZKHQWKHWD[LVFDOFXODWHGDQGGXH UHDOSURSHUW\FDSDEOHRISRVWSHWLWLRQSHUIHFWLRQE\DOLHQRQ WKH SURSHUW\ IURP ZKLFK WKH FODLPV DURVH 6HH 86& &LW\RI:KLWH3ODLQVY$ 6*DOOHULD5HDO(VWDWH,QF ,QUH E E $ )HGHUDWHG'HSjW6WRUHV,QF 1R& DW 6' 2KLR6HSW FLWDWLRQVRPLWWHG 7KHEDQNUXSWF\FRXUWKHOGWKDWXQGHU D WKH&LW\ DVVHVVHGWKHWD[HVSUHSHWLWLRQ%HFDXVHLWIRXQGWKDWWKHWD[HV 7KHGLVWULFWFRXUWFLWHGVHYHUDOFDVHVWKDWDGRSWHGWKHVDPH ZHUHDVVHVVHGSUHSHWLWLRQWKHEDQNUXSWF\FRXUWKHOGWKDWWKH GHILQLWLRQRImDVVHVVHGlWKDWLWGLG7KHGLVWULFWFRXUWQRWHG WD[HV ZHUH QRW DGPLQLVWUDWLYH H[SHQVH FODLPV XQGHU WKDW WKRVH FDVHV IRXQG LW UHOHYDQW WKDW WKH JRYHUQPHQWDO E % L HQWLWLHVLQYROYHGFRXOGKDYHSUHVHUYHGWKHLUULJKWWRSD\PHQW E\ILOLQJDFODLPIRUDFRQWLQJHQWXQOLTXLGDWHGDPRXQWXQGHU 7KH GLVWULFW FRXUW GLVDJUHHG ZLWK WKH EDQNUXSWF\ FRXUWjV WKHGHILQLWLRQRImFODLPlLQWKH%DQNUXSWF\&RGH KROGLQJ RQ WKH PHDQLQJ RI mDVVHVVHGl EXW DIILUPHG WKH GHFLVLRQRQRWKHUJURXQGV7KHGLVWULFWFRXUWKHOGWKDWDWD[ 7KHGLVWULFWFRXUWZHQWRQWRKROGWKDWXQGHU1HZ WD[VWDWXVGDWHRIsDQXDU\ WKHGLVWULFWFRXUWIRXQGWKH :KLOHPDQ\VWDWHVGHILQHDVVHVVPHQWLWLVIHGHUDOODZWKDW WD[HV ZHUH SUHSHWLWLRQ GHEWV DQG QRW DQ DGPLQLVWUDWLYH GHWHUPLQHV ZKDW DFWLRQV FRQVWLWXWH DQ DVVHVVPHQW XQGHU H[SHQVHXQGHU E % L D % ,QUH*DUILQFNHOV %5DW FLWLQJ .LQJY)UDQFKLVH7D[%G ,QUH.LQJ )G :LWKUHVSHFWWRWKHDOWHUQDWLYHFODLPWKHEDQNUXSWF\FRXUW WK&LU KHOGWKDWWKH&LW\GLGQRWKDYHDSUHSHWLWLRQLQWHUHVWLQWKHUHDO SURSHUW\WKDWFRXOGEHSHUIHFWHGSRVWSHWLWLRQ,QUHDFKLQJLWV ,Q LQWHUSUHWLQJ mDVVHVVHGl XQGHU D % WKH GHFLVLRQWKHEDQNUXSFW\FRXUWDFNQRZOHGJHGWKDWWKH86 EDQNUXSWF\FRXUWPHUHO\LPSRUWHG1HZ DSSHDOIURPWKHGLVWULFWFRXUW7KHEDQNUXSWF\FRXUWPDNHV LPSURYHPHQWV WKHUHWR VXFK DV IRU VHZHUV RU VLGHZDONV m$VVHVVl LV VRPHWLPHV XVHG DV V\QRQ\PRXV ZLWK mOHY\l LQLWLDOILQGLQJVRIIDFWDQGFRQFOXVLRQVRIODZ7KHGLVWULFW FRXUWWKHQUHYLHZVWKHEDQNUXSWF\FRXUWjVILQGLQJVRIIDFWIRU %ODFNjV /DZ 'LFWLRQDU\ WK HG FOHDUHUURUDQGWKHEDQNUXSWF\FRXUWjVFRQFOXVLRQVRIODZGH QRYRl:HVEDQFR%DQN%DUQHVYLOOHY5DIRWK ,QUH%DNHU :H DOVR UHMHFW 1HZ GLG QRW DFTXLUH DQ LQ SHUVRQDP ULJKW WR SD\PHQW IURP WKH 5HDO(VWDWH ,QUH+LJKODQG6XSHUVWRUHV,QF )G GHEWRU 6HH 1< 5HDO 3URS 7D[ /DZ m$OO WK&LU DVVHVVPHQWV VKDOO EH DJDLQVW WKH UHDO SURSHUW\ LWVHOI ZKLFK VKDOO EH OLDEOH WR VDOH SXUVXDQW WR ODZ IRU DQ\ XQSDLG :LWK UHJDUG WR WKH &LW\jV DSSHDO DV WR ZKHWKHU LW KDG D WD[HVl SUHSHWLWLRQLQWHUHVWLQWKHWD[HVm>Z@KHWKHUDQDSSHDOFRPHV WR RXU FRXUW E\ ZD\ RI D GLVWULFW FRXUW RU WKH >EDQNUXSWF\ 7KH&LW\GLGQRWDFTXLUHDQLQSHUVRQDPFODLPDJDLQVW$ 6 DSSHOODWH SDQHO@ RXU UHYLHZ LV RI WKH EDQNUXSWF\ FRXUWjV *DOOHULDRQsDQXDU\ 1RWXQWLOWKHSRVWSHWLWLRQOHY\ GHFLVLRQl.RHQLJ6SRUWLQJ*RRGVY0RUVH5G&R ,QUH GLG WKH &LW\ DFTXLUH D ULJKW WR SD\PHQW IURP WKH GHEWRUjV .RHQLJ6SRUWLQJ*RRGV,QF )G WK&LU HVWDWH6HH1<5HDO3URS7D[/DZ m7KHRZQHU TXRWLQJ&RU]LQY)RUGX ,QUH)RUGX )G RIUHDOSURSHUW\VKDOOEHSHUVRQDOO\OLDEOHIRUWKHWD[HV Q WK&LU $VEHIRUHWKHGLVWULFWFRXUWDQGWKH OHYLHGWKHUHRQl 7KHULJKWWRSD\PHQWUHPDLQHGXQPDWXUHG EDQNUXSWF\DSSHOODWHFRXUWDEDQNUXSWF\FRXUWjVFRQFOXVLRQV XQWLOsXO\ZKHQWKHWD[HVEHFDPHGXHDQGSD\DEOH$WWKH RIODZDUHUHYLHZHGGHQRYR,QUH+LJKODQG6XSHUVWRUHV WLPH WKH OHY\ WRRN SODFH WKH GHEWRUjV HVWDWH RYHUVDZ WKH ,QF)GDW SURSHUW\DQGLVWKHUHIRUHUHVSRQVLEOHIRUSD\LQJWKHWD[7KXV WKH WD[ ZDV LQFXUUHG E\ WKH HVWDWH IRU SXUSRVHV RI ,,, E % L 6HFWLRQ RI WKH %DQNUXSWF\ &RGH JLYHV SULRULW\ WR %m$VVHVVHGlXQGHU D % FHUWDLQXQVHFXUHGFODLPVRIFUHGLWRUV7KH%DQNUXSWF\&RGH JLYHVDILUVWSULRULW\WRWKHDGPLQLVWUDWLYHH[SHQVHVQHFHVVDU\ :HQH[WPXVWGHFLGHLIWKHSURSHUW\WD[HVDWLVVXHDUHWKH WRSUHVHUYHWKHGHEWRUjVHVWDWHGXULQJWKHEDQNUXSWF\6HH NLQGVSHFLILHGLQ D WKDWLVZKHWKHUWKHFODLPLVIRU 86& D mD SURSHUW\ WD[ DVVHVVHG EHIRUH WKH FRPPHQFHPHQW RI WKH FDVHl 86& D % ,I VR WKH WD[HV DUH QRW $GPLQLVWUDWLYHH[SHQVHVLQFOXGHmDQ\WD[LQFXUUHGE\ DGPLQLVWUDWLYHH[SHQVHV WKHHVWDWHH[FHSWDWD[RIDNLQGVSHFLILHGLQVHFWLRQ D RI WKLV WLWOHl 86& E % L &ODLPV IRU 7KHUHKDVEHHQDJUHDW GHDO RIFRQIXVLRQLQGHWHUPLQLQJ DGPLQLVWUDWLYHH[SHQVHVXQGHU E DUHVWULFWO\FRQVWUXHG &RQJUHVVjV PHDQLQJ RI mDVVHVVHGl XQGHU D % EHFDXVH SULRULW\ FODLPV UHGXFH WKH IXQGV DYDLODEOH IRU m$VVHVVHGl KDV PDQ\ GLIIHUHQW PHDQLQJV DQG FDQ UHIHU WR FUHGLWRUVDQGRWKHUFODLPDQWV,QUH$OXPQL+RWHO&RUS QHDUO\HYHU\VWHSLQWKHSURFHVVRILPSRVLQJDSURSHUW\WD[ %5 %DQNU (' 0LFK FLWLQJ 0IUV +DQRYHU7UXVW&RY%DUWVK ,QUH)OLJKW7UDQVS&RUS6HF /LWLJ )G WK&LU %ODFNjV /DZ 'LFWLRQDU\ GHILQHV mDVVHVVl DV ,QGHWHUPLQLQJZKHWKHUDFODLPLVDYDOLGDGPLQLVWUDWLYH 7R DVFHUWDLQ IL[ WKH YDOXH RI 7R IL[ WKH DPRXQW RI WKH H[SHQVH D FRXUW PXVW GHFLGH ZKHWKHU WKH WD[HV ZHUH GDPDJHV RU WKH YDOXH RI WKH WKLQJ WR EH DVFHUWDLQHG 7R LPSRVH mLQFXUUHGlE\WKHHVWDWHDQG ZKHWKHUWKHWD[HVDUHRID D SHFXQLDU\ SD\PHQW XSRQ SHUVRQV RU SURSHUW\ 7R DVFHUWDLQ NLQGVSHFLILHGLQ D 6HH0DULRQ&RXQW\7UHDVXUHU DGMXVW DQG VHWWOH WKH UHVSHFWLYH VKDUHV WR EH FRQWULEXWHG E\ VHYHUDO SHUVRQV WRZDUG DQ REMHFW EHQHILFLDO WR WKHP DOO LQ Y%OXH/XVWUH3URGV,QF ,QUH%OXH/XVWUH3URGV,QF SURSRUWLRQ WR WKH EHQHILW UHFHLYHG 7R WD[ %5 6',QG ,Q FRQQHFWLRQ ZLWK WD[DWLRQ RI SURSHUW\ PHDQV WR PDNH D ,QUH)HGHUDWHG'HSjW 1RV 1RV ,QUH)HGHUDWHG'HSjW 6WRUHV $ 6*DOOHULD 6WRUHV $ 6*DOOHULD 6HFWLRQ D % JLYHVDQHLJKWKSULRULW\WRSURSHUW\ WR PDWXUH RQ WKH WD[ GXH GDWH %XW QRWKLQJ LQ 3DUU WD[HVmDVVHVVHGEHIRUHWKHFRPPHQFHPHQWRIWKHFDVHDQGODVW 0HDGRZV VXJJHVWV WKDWLQ SHUVRQDP ULJKWV DJDLQVW WKH SD\DEOHZLWKRXWSHQDOW\DIWHURQH\HDUEHIRUHWKHGDWHRIWKH WD[SD\HUnDV RSSRVHG WR LQ UHP ULJKWV DJDLQVW WKH ILOLQJ RI WKH SHWLWLRQl 86& D % ,I D WD[ SURSHUW\nDUHLQDQ\ZD\DFTXLUHGRUDULVHRQWKHWD[ TXDOLILHV IRU WKH HLJKWK SULRULW\ XQGHU D LW LV VWDWXVGDWH,IWKH'HEWRUVKDGVROGWKHUHDOSURSHUW\LQ GLVTXDOLILHGIURPWKHILUVWSULRULW\DFFRUGHGWRDGPLQLVWUDWLYH TXHVWLRQEHWZHHQWKHWD[VWDWXVGDWHDQGWKHEDQNUXSWF\ H[SHQVHV ILOLQJVWKHUHLVQRTXHVWLRQEXWWKDWWKH&LW\ZRXOGKDYH UHWDLQHG D OLHQ RQ WKH SURSHUW\ QRWZLWKVWDQGLQJ WKH 7KH WZRSURQJ VWDQGDUG RI E % L KDV EHHQ FKDQJHLQRZQHUVKLS EXWWKHUHLVHTXDOO\QRTXHVWLRQEXW GLIILFXOW WR XVH SULPDULO\ EHFDXVH WKH WHVWV XQGHU WKH WZR WKDWWKH&LW\ZRXOGQRWKDYHKDGHYHQDQDUJXDEOHFODLP SURQJV XVHV WZR GLIIHUHQW NH\ ZRUGVn mLQFXUUHGl DQG DJDLQVW WKH 'HEWRUV SHUVRQDOO\ IRU SD\PHQW RI UHDO mDVVHVVHGlnZKLFK DUH QRW QHFHVVDULO\ PXWXDOO\ H[FOXVLYH SURSHUW\ WD[HV GXH IRU D SHULRG VXEVHTXHQW WR WKHLU $VRQHFRPPHQWDWRUKDVQRWHG RZQHUVKLS >,@W LV RZQHUVKLS RI WKH UHDO SURSHUW\ VXEMHFW WR WD[DWLRQ GXULQJ WKH SHULRG ZLWK UHVSHFW WR 'HSHQGLQJ RQ WKH FKDUDFWHUL]DWLRQ RI ZKHQ D WD[ LV ZKLFKWD[HVDUHLPSRVHGWKDWJLYHVULVHWRWKHSHUVRQDO mLQFXUUHGl DQG mDVVHVVHGl LW LV SRVVLEOH WKDW XQGHU D REOLJDWLRQWRSD\WKHWD[DQGWKDWVLWXDWLRQFDQQRWDULVH VWULFWUHDGLQJRIWKH&RGHDWD[FRXOGEHLQFXUUHGEHIRUH XQWLOWKHWD[GXHGDWH EDQNUXSWF\ DQG WKXV EH LQHOLJLEOH IRU ILUVW SULRULW\ WUHDWPHQWEXWQRWEHDVVHVVHGXQWLODIWHUEDQNUXSWF\DQG ,QUH5+0DF\%5DWo FLWDWLRQVDQGIRRWQRWH WKXVEHGLVTXDOLILHGDVD>QHLJKWK@SULRULW\ RPLWWHG VHHDOVR,QUH*DUILQFNHOV,QF%5 %DQNU ''& KROGLQJ WKDW 0DU\ODQG SURSHUW\ WD[ :LOOLDP / 1RUWRQ %DQNUXSWF\ /DZ DQG 3UDFWLFH G ODZZKLFKKDVDVLPLODUWLPHWDEOHDV1HZ 7D[HVDUHOHYLHG WKH GLVWULFWFRXUWIRXQGWKDWWKHWD[HVZHUHDFODLPDJDLQVW )LUVWLQVWDOOPHQWRIWD[LVGXHDQGSD\DEOH SUHSHWLWLRQ GHEWRU $ 6 *DOOHULD DQG QRW LQFXUUHG E\ WKH 7D[\HDUEHJLQV GHEWRUjVHVWDWH 6HFRQGLQVWDOOPHQWRIWD[LVGXHDQGSD\DEOH 7D[\HDUHQGV %HIRUHWXUQLQJWR1HZ ,QWKLVFDVHWKHGLVWULFWFRXUWPLVLQWHUSUHWHG6SLHJHODV 1RQHRIWKHVHGHFLVLRQVUHOLHGXSRQE\WKHGLVWULFWFRXUW KROGLQJWKDW1HZ
White Plains NY v. A & S Galleria (White Plains NY v. A & S Galleria) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.