### Miracle NY Props. LLC v Nayber 18 LLC 2024 NY Slip Op 33067(U) August 29, 2024 Supreme Court, New York County Docket Number: Index No. 656463/2023 Judge: Lyle E. Frank 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.NYSCEF DOC. NO. 59 INDEX NO. 656463/2023 RECEIVED NYSCEF: 08/29/2024 

### SUPREME COURT OF THE STATE OF NEW YORK NEWYORK COUNTY PRESENT: HON. LYLE E. FRANK PART 11M Justice

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MIRACLE NY PROPERTIES LLC

- V - NAYBER 18 LLC, Plaintiff,

Defendant.

------------------------------------------------------------------- --------------X INDEX NO. 656463/2023 MOTION DATE 02/09/2024 MOTION SEQ. NO. 002 DECISION + ORDER ON MOTION

The following e-filed documents, listed by NYSCEF document number (Motion 002) 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39,40,41,42,43,45,47,48,49,50, 51, 52, 53,54, 55,56,57,58 were read on this motion to/for JUDGMENT-SUMMARY This action arises out ofa real estate contract datedAugust 18, 2022, wherein defendant contracted to purchase the Condominium Units 17A, 17B and 17/18A, located at 100 Eleventh Avenue, New York, New York. Plaintiffnow seeks an order declaring, inter alia, that defendant breached the contract, and thatplaintiffis entitled to retain the downpayment of$1,000,000. Defendant opposes the instantmotion and cross-moves for the return ofthe down payment. For the reasons set forth below, plaintiff's motion is granted in its entirety and the cross-motion is denied. Background The facts in this matter are mostlynot in dispute. On November 17, 2022, Miracle NY Properties LLC ("seller" or "plaintiff') and Nayber 18 LLC ("buyer" or "defendant") entered into a purchase agreement ("the contract") underwhich plaintiffagreed to sell and defendant agreed to purchase three condominiumunits. The purchase price was $15,500,000. The Purchase Agreement was amended for the first time on November 17, 2022, reducing the purchase price to $13,000,000, setting the closing date as on orbefore February 1,

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2023, and declaring that the buyer's due diligence periodhad ended. The November 17, 2022, amendment also providedthat $250,000 ofthe Downpaymentwas immediately nonrefundable and may only bereturned to defendant ifplaintiffdefaulted, was unable to convey title, the condominium exercised its right offirst refusal, or there was a casualty withrespect to the property. It further providedthat the $750,000 balance ofthe downpayment "shall be deemed non-refundable upon receipt ofupon CondominiumApproval and may only be returned to Purchaserupon the following events: (i) Seller's default; (ii) Seller's inability to convey title in accordance with Paragraph 18 ofthe Agreement; (iii) the Condominium exercises its right to first refusal in accordance with Paragraph 8 ofthe Agreement; or (iv) Purchaser elects to cancel the Agreement due to a casualty in accordance with Paragraph 19 ofthe Agreement." On June 15, 2023 plaintiffsent defendant a letter stating that, "(a) Buyerfailed to timely submit the complete application for approval ofalterations with Buyer'sPlan's as requiredby November 18, 2022; (b) Buyerfailed to timely pay the application fees for Buyer'sPlans; (c) Buyerfailed to use its best efforts to secure expeditious approvals ofBuyer'sPlans; (d) Buyer materially further delayed approval ofBuyer'sPlans; and (e) Buyerfailed to close title to the Property on orbefore February 1, 2023." Plaintiffdemanded that defendant close on the purchase and sale ofthe property on orbefore July 20, 2023, 'timebeing ofthe essence." On October 30, 2023, plaintiffs counsel sent another letter to defendant stating that "all conditions to a closing have now been satisfied. The approval ofthe condominiumhas been secured for the Buyer's plans and Declaration amendment, and an acceptable alteration agreement has been secured." Plaintifffurther stated that "demandis hereby made thatBuyer close on the transaction no later than November 10, 2023, time being ofthe essence. Failure to

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close on the purchasebyNovember 10, 2023, shall be a default and result in the forfeiture of Buyer's deposit." On November 8, 2023, the parties executed a second amendment to the contract in which they represented that defendant had secured financing, waived all contingencies relating to condominium approval and agreed to close within ten days. This amendment removed Unit 17A from the deal and reduced the purchase price from $13,000,000 to $10,400,000. The parties set a closing date for November 30, 2023. On November 29, 2023, defendant wrote to plaintiff stating that its lender was "delayedto the thanksgiving holiday. We are aiming to close on December 8th." On November 30, 2023, plaintiffsent a letter to defendant stating, "All conditions to closing have been satisfied and a closing was scheduled for today, November 30, 2023. You have now requested a closing on December 8, 2023. In the event this transaction does not close byDecember 11, 2023, our client will not abide by any further delay and the security deposit will be forfeited in full." On December 7, 2023, a representative for defendant emailedplaintiffthat defendant would notbe closing on December 8th and that additional information wouldbe provided as soon as possible. On December 11, 2023, plaintiffadvised defendant that pursuant to its November 30 letter, due to defendants' failure to close on December 11, 2023, the contract was terminated, and the $1,000,0000 security deposit was due to seller. In response, counsel for defendant responded to plaintiffstating that "purchaseris planning to close this transaction with financing and has encountered delays due to the unreasonable condominiumboardrequirements. Purchaser is not in breach ofcontract." Defendant's counsel continued, "this is NOT a TIME OF ESSENCE

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closing and you are prohibited from releasing the deposit, which you have incorrectlyreferred to
as a 'SecurityDeposit.' Anyrelease ofthe Depositis at your own risk."

Standard It is a well-establishedprinciple that the "function of summaryjudgment is issue finding, not issue determination." 

### (Assafv Ropog Cab Corp., 153 AD2d 520, 544 [1st Dept 1989]). As such, the proponent ofa motion for summaryjudgment must tender sufficient evidence to show the absence ofany material issue offact and the right to entitlement to judgment as a matter of law. 

### (Alvarez v Prospect Hospital, 68 NY2d 320, 501 [1986]; 

### Winegrad v New York University Medical Center, 64 NY 2d 851 [1985]). Courts have also recognized that summaryjudgment is a drastic remedy that deprives a litigant ofhis or her day in court. Therefore, the party opposing a motion for summaryjudgment is entitled to all favorable inferences that canbe drawn from the evidence submitted.

Discussion Plaintiffargues that itperformed all conditions ofthe contract and the defendant breached, and therefore defendant forfeited the down paymentpursuant ofthe terms ofthe contract. Defendant offers several arguments for why itwas not in breach. The Court will address each argument in tum. First, defendant contends thatplaintifffailed to properly declare a time ofessence closing. Defendant argues plaintiffs closing notice was deficient because it failed to give an unequivocal closing date, time, or location. The Court finds this argumentunavailing.

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When a contract does not specify that time is ofthe essence, one party may subsequently give notice to that effect provided that such notice is clear, distinct, andunequivocal and fixes a reasonable time within which to perform. 

### (Stefanelli v. Vitale, 223 AD2d 361 [1st Dep't 1996];


### see also Shimura v Preston TaylorProds., LLC, 146 AD3d 729 [1st Dep't 2017]). "Aparty need not state specifically that time is ofthe essence, as long as the notice specifies a time on which to close and warns that failure to close on that date will result in default." 

### (Karamatzanis v. Cohen, 181 AD2d 618, 618 [1st Dept. 1992]; 

### see also Westreich v. Bosler, 106 AD3d 569 [2013]). Here, plaintiffadvised defendant that it would not "abideby any further delay" and that failure to close byDecember 11, 2023, wouldresult in forfeiture ofthe security deposit. A date
was set, and defendants were on notice that default would occur after that date. Moreover, plaintiffhad previously notified defendants specifically that "time was ofthe essence" when seeking to schedule prior closing dates. While defendants argue thatplaintiffs notice is insufficientbecause it failed to specify a specific place and time, defendant cites no precedent to support this argument. The cases citedby defendant are inapposite. In

### ADC Orange, Inc. v. CoyoteAcres, Inc. (7 NY3d 484 [2006]), the Court ofAppeals held that "the mere designation ofa particular date upon which a thing is to be done does notresult in making that date the essence ofthe contract," where the party seeking a time ofessence closing failed to place the other party on notice that its failure to by a specific date would amount to a default and the forfeiture ofa down payment. Unlike ADC Orange Inc., here, plaintiffdid put defendant on notice that its failure to close by December 11, 2023, would constitute default. Next, defendant contends that plaintiffs notice ofdefault was improperbecause the time ofessence letter and termination notice were not servedupon defendant in accordance with the

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parties' contract. Defendant contends that pursuantto the contract, notices were to be served upon Alvin Schein, Esq. by eitherpersonal delivery, certified mail, overnight courier, or facsimile. Defendant argues thatbecause the November 30, 2023, letter was not addressed to Alvin Schein, Esq., norwas the email copied to Mr. Schein, nor was letter servedbypersonal delivery, overnight courier with receipt, certified mail withreturn receipt or facsimile transmission, notice was insufficient. Defendant further argues the service ofthe December 11, 2023, letterwas improperbecause while it was addressed to Mr. Schein, it was emailedto Ms. Jacobson. However, defendant admits that ithas a physical copy ofthe letter in its file but argues that "there is no indication ofhow it was served." In opposition, plaintiffargues that underNew Yorklaw, strict compliance with a contract's notice provisions is notrequired when defendant fails to claim that they did notreceive actual notice orthat they were in anywayprejudiced from the deviation. 

### (Baker v. Norman, 226A.D.2d 301, 304 [1st Dept. 1996]). The Court agrees. Here, the November 30, 2023, letter
was addressed and emailedto Buyer's attorney Stacy Jacobson ofSeiden & Schein, P.C, ofthe
same firm as Alvin Schein ofthe same firm, Seiden & Schein, P.C. Ms. Jacobson's affirmation admits that she is Buyer's attorney and that she was representing Buyer during the transactions and involved in communications between the parties. The Courtfinds the remainder ofdefendant's arguments unavailing. There are some additional damages for expenses that this Court finds plaintiffis entitled to, but an inquestwill beneeded to determine the amount ofthose damages. Accordingly, it is hereby ADJUDGED that plaintiffs motion for summaryjudgmentis granted; and itis further

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### ADJUDGED that defendant's cross motion for summaryjudgmentis denied; and it is further ORDERED that escrow agent McCue Sussmane Zapfel & 

### Cohen P.C. are hereby authorized and directedto release the down payment of$1,000,000 to PlaintiffMiracle NY Properties LLC; and it is further ORDERED that an assessment of the remainder of damages as against defendant is directed; it is further ORDERED that a copy ofthis orderwithnotice ofentrybe servedbythe movantupon the Clerk ofthe General Clerk's Office, who is directed, upon the filing of a note of issue and a certificate of readiness and the payment of proper fees, if any, to place this action on the appropriate trial calendar for the assessmenthereinabove directed; it is further ORDERED that such service upon the Clerk ofthe General Clerk's Office shall be made in accordance with the procedures set forth in the Protocol on Courthouse and County Clerk Proceduresfor Electronically Filed Cases (accessible at the "E-Filing" page on the court's website).

8/29/2024

DATE CHECK ONE:
APPLICATION: CHECK IF APPROPRIATE: CASE DISPOSED GRANTED**□** DENIED SETTLE ORDER INCLUDES TRANSFER/REASSIGN

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# ~ NON-FINAL DISPOSITION GRANTED IN PART SUBMIT ORDER FIDUCIARY APPOINTMENT

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