Court Opinion

ID: 4086171
Source: CourtListenerOpinion
Date Created: 2016-10-08 00:05:46.230307+00
Date Added: 2024-06-11T12:51:41.412291
License: Public Domain

SUPREME COURT OF THE STATE OF NEW YORK
           Appellate Division, Fourth Judicial Department

328
CA 11-02055
PRESENT: SCUDDER, P.J., CARNI, LINDLEY, AND SCONIERS, JJ.

RAMESH L. CHAINANI AND BONNIE R. CHAINANI,
PLAINTIFFS-APPELLANTS,

                    V                             MEMORANDUM AND ORDER

RONALD A. LUCCHINO AND BARBARA T. LUCCHINO,
DEFENDANTS-RESPONDENTS.

PHILLIPS LYTLE LLP, BUFFALO (MINRYU KIM OF COUNSEL), FOR
PLAINTIFFS-APPELLANTS.

HAGERTY & BRADY, BUFFALO (MICHAEL A. BRADY OF COUNSEL), FOR
DEFENDANTS-RESPONDENTS.

     Appeal from an order of the Supreme Court, Erie County (Donna M.
Siwek, J.), entered January 14, 2011. The order, insofar as appealed
from, denied plaintiffs’ motion for attorneys’ fees.

     It is hereby ORDERED that the order so appealed from is affirmed
without costs.

     Memorandum: In December 2000, defendants entered into an
agreement with plaintiffs (2000 agreement), granting plaintiffs two
easements. One of the easements was a nonexclusive “permanent right”
to park vehicles on one section of defendants’ parking lot (Permanent
Lot). In the spring of 2008 defendants made modifications to the
Permanent Lot, allegedly preventing plaintiffs from exercising their
rights to use that lot. Plaintiffs commenced this action alleging
that defendants had breached the 2000 agreement and seeking injunctive
relief, damages and attorneys’ fees.

     The parties subsequently entered into a stipulation, granting
plaintiffs “the relief sought by [them] . . . on their Second Cause of
Action.” Pursuant to the stipulated order, defendants were to make
various modifications to the Permanent Lot. The stipulated order
further provided that, having been granted the relief sought in the
second cause of action, that cause of action was dismissed and severed
from the remainder of the complaint, which would be subject to later
adjudication. By a separate stipulation of discontinuance, the
parties stipulated to dismiss plaintiffs’ first cause of action, which
sought injunctive relief prohibiting defendants from obstructing
plaintiffs’ parking rights. That dismissal was “without prejudice to
[subsequent] application[s] . . . for reimbursement of . . .
attorney[s’] fees, costs and disbursements.”
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                                                         CA 11-02055

     Plaintiffs thereafter moved for an award of, inter alia,
attorneys’ fees and costs on the ground that they were the “prevailing
party” within the meaning of the 2000 agreement. In relevant part,
the 2000 agreement provided that, “[i]n the event that either [party]
shall seek enforcement of the rights conferred pursuant to this
[agreement], then the prevailing party shall be entitled to
reimbursement and indemnification for all reasonable attorneys’ fees,
costs and disbursements expended as a result thereof (emphasis
added).” The term “prevailing party” was not defined in the 2000
agreement. We conclude that Supreme Court properly denied the motion,
determining that plaintiffs were not the “prevailing party” under the
terms of the stipulated order.

     In determining whether a party is a prevailing party, a
fundamental consideration is whether that party has “prevailed with
respect to the central relief sought” (Nestor v McDowell, 81 NY2d 410,
416, rearg denied 82 NY2d 750; see Sykes v RFD Third Ave. I Assoc.,
LLC, 39 AD3d 279, 279). “[S]uch a determination requires an initial
consideration of the true scope of the dispute litigated, followed by
a comparison of what was achieved within that scope” (Excelsior 57th
Corp. v Winters, 227 AD2d 146, 147).

     Here, plaintiffs alleged in their complaint that defendants
breached the 2000 agreement, and they sought injunctive relief,
damages and attorneys’ fees. Thus, the “true scope” of the dispute
was whether defendants’ breached the 2000 agreement (id.).
Plaintiffs, however, did not obtain the full measure of injunctive
relief they sought, did not receive an award of damages and,
importantly, did not obtain a determination that defendants breached
the 2000 agreement. The court, which was “significantly involved in
the settlement discussions that led to the stipulated order,”
concluded that, although plaintiffs were “ ‘successful’ in obtaining
some of the relief requested,” it would be “disingenuous for
[plaintiffs] to declare that [they were] the prevailing party.” We
agree. “In view of the mixed results of this litigation, in which
plaintiffs stipulated to resolve certain . . . claims, but also
stipulated to discontinue [certain] claims, and abandoned [other]
claims . . ., plaintiffs cannot be considered the prevailing party in
this litigation” (Berman v Dominion Mgt. Co., 50 AD3d 605, 605).

     We note that plaintiffs’ reliance on McGrath v Toys “R” Us, Inc.
(3 NY3d 421) is misplaced. That action concerned attorneys’ fees
awarded in the context of a complex civil rights action, where only
nominal damages were awarded. That case is thus distinguishable from
the instant action (see generally Texas State Teachers Assn. v Garland
Ind. School Dist., 489 US 782, 789). Contrary to plaintiffs’
contention, the public policy in favor of honoring private fee-
shifting agreements does not compel a different result. Because the
2000 agreement did not define the term “prevailing party,” there was
no provision of that agreement expressly providing for the recovery by
plaintiffs of attorneys’ fees where, as here, plaintiffs obtained only
a small measure of the overall relief they sought (cf. Jay N Jen, Inc.
v Polge Seafood Distrib., Inc., 70 AD3d 1447, 1449).
                                 -3-                           328
                                                         CA 11-02055

     All concur except CARNI, J., who dissents and votes to reverse
the order insofar as appealed from in accordance with the following
Memorandum: I respectfully disagree with the conclusion of my
colleagues that plaintiffs were not the “prevailing parties” within
the meaning of the agreement granting plaintiffs two easements (2000
agreement), and I therefore dissent.

     The 2000 agreement provides that, if either the grantee or the
grantor “shall seek enforcement of the rights conferred pursuant to
this [agreement], then the prevailing party shall be entitled to
reimbursement and indemnification for all reasonable attorneys’ fees,
costs and disbursements expended as a result thereof.” There is no
dispute that the central focus of plaintiffs’ action was to enforce
their parking rights under the agreement. As a result of the
litigation, defendants were required to (1) remove the designation of
two parking spaces as “handicapped parking” and return them to their
original unrestricted availability for use by plaintiffs’ business
patrons; (2) remove the markings of “No Parking” painted on the area
designated in the 2000 agreement for plaintiffs’ parking; and (3)
permit plaintiffs to restripe the area previously designated “No
Parking” to provide for parking consistent with plaintiffs’ rights
under the 2000 agreement.

     Contrary to the majority’s conclusion, it is not necessary that a
party achieve the “full measure” of the relief sought to be entitled
to the reimbursement and indemnification sought herein. In order to
justify an award of contractual attorneys’ fees, the court need not
grant the relief sought in each claim raised in a lawsuit (see Senfeld
v I.S.T.A. Holding Co., 235 AD2d 345, lv dismissed 91 NY2d 956, lv
denied 92 NY2d 818). The analysis in determining whether such an
award is warranted does not involve a mere computation of the claims
granted. Rather, the party seeking such reimbursement and
indemnification must simply be the prevailing party on the central
claims advanced, and must receive “substantial relief” to warrant the
conclusion that the party had prevailed on those central claims (501
E. 87th St. Realty Co. v Ole Pa Enters., 304 AD2d 310, 311). “Where a
lawsuit consists of related claims, a plaintiff who has won
substantial relief should not have his [or her] attorney’s fee reduced
simply because the . . . court did not adopt each contention raised”
(Hensley v Eckerhart, 461 US 424, 440; see Senfeld, 235 AD2d at 345;
Matter of Rahmey v Blum, 95 AD2d 294, 304). In the instant case, the
stipulated court order validated plaintiffs’ theory of recovery in
several categories, and granted plaintiffs the substantial relief that
they requested (see Board of Mgrs. of 55 Walker St. Condominium v
Walker St., LLC, 6 AD3d 279, 280). The fact that plaintiffs’ success
“was only partial does not negate the fact that [they] prevailed” in
enforcing the 2000 agreement (Duane Reade v 405 Lexington, L.L.C., 19
AD3d 179, 180; see Board of Mgrs. of 55 Walker St. Condominium, 6 AD3d
279).

     I further note that the majority’s reliance upon the fact that
plaintiffs “did not obtain a determination that defendants breached
the 2000 agreement” belies the nature of the litigation course pursued
by the parties and places form over substance. Inasmuch as the
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                                                         CA 11-02055

parties expressly agreed in the stipulation of discontinuance to
reserve the parties’ rights to seek attorneys’ fees, costs and
disbursements, they recognized and agreed that the absence of an
express determination on the merits by the court was no barrier to the
recovery of such sums under the 2000 agreement (see generally Gaisi v
Gaisi, 48 AD3d 744, 745).

     Therefore, I would reverse the order insofar as appealed from,
thereby leaving intact the court’s denial of the cross motion of
defendants for attorneys’ fees, grant that part of plaintiffs’ motion
for an award of attorneys’ fees, costs and disbursements, and remit
the matter to Supreme Court for a determination of the reasonable
amount of attorneys’ fees, costs and disbursements expended by
plaintiffs as a result of this litigation, inclusive of this appeal.

Entered:   April 27, 2012                       Frances E. Cafarell
                                                Clerk of the Court