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55 BROADWAY, THIRD FLOOR, NEW YORK, NY 10006
December 1, 2022
By E-File
Honorable Melissa A. Crane
Supreme Court of the State of New York
County of New York, Commercial Division Part 60
60 Centre Street, Room 248
New York, New York 10007
Re: EXRP 14 Holdings LLC v. LS-14 AVE LLC, No. 652698/2022
Dear Justice Crane:
I write on behalf of Plaintiff in anticipation of the hearing scheduled for December 2, 2022, to
propose a potentially constructive avenue for discussion regarding the notice of pendency
Plaintiff has filed in this action (which is the subject of motion sequence 2).
While Plaintiff filed the notice of pendency in good faith and continues to believe that it is
squarely warranted by the claims here, which plainly “would affect the title to, or the possession,
use or enjoyment of real property” (CPLR 6501), Plaintiff is also mindful of the Court’s
concerns regarding the potential impact of the notice of pendency. Plaintiff writes to make
unmistakably clear that Plaintiff has no intention whatsoever of misusing the notice of pendency
for any improper purpose, and that Plaintiff’s goal is solely to protect the benefit of its
bargained-for performance under the parties’ PSA.
To that end, Plaintiff respectfully submits that CPLR 6515 provides a sound and apt framework
for allaying the Court’s concerns regarding the notice of pendency. Under CPLR 6515, the Court
may direct cancellation of a notice of pendency, provided that the defendant “shall give an
undertaking” in an amount such that “adequate relief can be secured to the plaintiff.”1 The
plaintiff, in turn, can overcome the cancellation if it commits to an undertaking that will
indemnify the defendant for “the damages that he or she may incur if the notice is not cancelled.”
This mechanism is often called “double bonding.” Here, the potential harm to the Plaintiff from
Defendant’s breaches (and thus Defendant’s appropriate undertaking) is substantial, including
the imperilment of the $20 million lease Plaintiff had bargained for and secured for the unit.
CPLR 6515 thus effectively anticipates the Court’s concern and provides that if Defendant
wishes to sell the disputed unit during this lawsuit, despite Defendant’s prior contractual
commitment to deliver it to Plaintiff in the condition agreed-upon under the PSA, then
Defendant should give an appropriate undertaking to secure adequate relief for Plaintiff and to
ensure that the transaction in which it seeks to engage not impair a future judgment on the claims
in this action. A substantial body of case law and commentary further supports this approach.2
1
“Undertaking” is defined in CPLR 2501.
2
See Andesco, Inc. v. Page, 137 A.D.2d 349, 358 (1st Dep’t 1988) (reversing cancellation of notice of
pendency “because no obligation for a bond was placed on defendant seller”); Mattone Grp. v. Telesector
At times, defendants subject to a notice of pendency have attempted to satisfy CPLR 6515’s
undertaking requirement by proposing to pledge the proceeds of any sale of the subject property
as the security for lifting the notice of pendency.3 The courts presented with those proposals have
held that such a proposal clearly does not satisfy the CPLR’s undertaking requirement. Id.
However, in the interest of working reasonably and in good faith with Defendant and the Court,
Plaintiff is open to discussing a consensual solution to lifting the notice of pendency that would
involve Defendant committing the proceeds of its sale of the property as security.4
For whatever reason, Defendant originally elected not to seek cancellation of the notice of
pendency under CPLR 6515, and instead moved only under CPLR 6514—which Defendant
cannot satisfy for the reasons discussed in Plaintiff’s prior submissions. In the interest of
reaching a just and reasonable resolution, however, Plaintiff submits that CPLR 6515 provides
the appropriate framework for evaluating any putative grievance with the notice of pendency,
and Plaintiff stands ready to discuss that framework at the parties’ upcoming hearing on
December 2.
We thank the Court for its time and attention to this matter.
Respectfully,
/s/ Jason Cyrulnik
Jason Cyrulnik
cc: Counsel of record (by NYSCEF)
Res. Grp., 2008 WL 412612, at *1 (Sup. Ct. Queens Cty. 2008) (requiring undertaking for cancellation of
notice of pendency and setting undertaking at amount that would compensate for loss of valuable
contract); see also, e.g., Bobash, Inc. v. Festinger, 57 A.D.3d 464, 466 (2d Dep’t 2008) (permitting
cancellation of notice of pendency “conditioned upon the appellants’ posting of an undertaking”); Kim v.
HFZ 11 Beach St. LLC, 2021 WL 2548337, at *1 (Sup. Ct. N.Y. Cty. 2021) (ordering undertaking for
$4.375 million, which “approximates the damages the plaintiff would incur if the property were
improperly sold to a third party”), aff’d 199 A.D.3d 415 (1st Dep’t 2021); Seidler v. Workable Atlantic
LLC, 2020 WL 2198232, at *5 (Sup. Ct. Kings Cty. 2020) (requiring undertaking in amount of plaintiff’s
potential damages of $8.3 million); N.Y.C. Energy Efficiency Corp. v. Suria, 2019 WL 587433, at *4-5
(Sup. Ct. N.Y. Cty. 2019) (rejecting argument that notice of pendency could be cancelled under CPLR
6515 without a proper undertaking by defendants); Corvera v. Prime Source Dev. LLC, 2017 WL
11493809, at *3 (Sup. Ct. Nassau Cty. 2017) (requiring undertaking for cancellation of notice of
pendency); Grinshpun v. Gennady, 2016 WL 5848834, at *3–4 (Sup. Ct. N.Y. Cty. 2016) (refusing to
cancel notice of pendency without undertaking); U.S. v. Cohn, 1987 WL 8345, at *1-2 (S.D.N.Y. 1987)
(“I have not found any case, and the present defendants have cited none, where over objection of the party
filing a valid notice of pendency, his adversary has been permitted to cancel that notice without first
giving the sort of financial undertaking defined by section 2501.”); CPLR 6515 Practice Commentary
(“The defendant’s undertaking is intended to give the plaintiff a form of monetary security—‘adequate
relief’—in substitution for the property itself.”) (collecting cases).
3
See Weksler v. Yaffe, 129 Misc. 2d 633, 637-38 (Sup. Ct. Kings Cty. 1985); U.S. v. Cohn, 1987 WL
8345, at *1-2 (S.D.N.Y. 1987).
4
Cf. Cohn, 1987 WL 8345, at *1-2 (discussing cases that involve “consent by the party obtaining the lis
pendens”).
2
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55 BROADWAY, THIRD FLOOR, NEW YORK, NY 10006 December 1, 2022 By E-File Honorable Melissa A. Crane Supreme Court of the State of New York County of New York, Commercial Division Part 60 60 Centre Street, Room 248 New York, New York 10007 Re: EXRP 14 Holdings LLC v. LS-14 AVE LLC, No. 652698/2022 Dear Justice Crane: I write on behalf of Plaintiff in anticipation of the hearing scheduled for December 2, 2022, to propose a potentially constructive avenue for discussion regarding the notice of pendency Plaintiff has filed in this action (which is the subject of motion sequence 2). While Plaintiff filed the notice of pendency in good faith and continues to believe that it is squarely warranted by the claims here, which plainly “would affect the title to, or the possession, use or enjoyment of real property” (CPLR 6501), Plaintiff is also mindful of the Court’s concerns regarding the potential impact of the notice of pendency. Plaintiff writes to make unmistakably clear that Plaintiff has no intention whatsoever of misusing the notice of pendency for any improper purpose, and that Plaintiff’s goal is solely to protect the benefit of its bargained-for performance under the parties’ PSA. To that end, Plaintiff respectfully submits that CPLR 6515 provides a sound and apt framework for allaying the Court’s concerns regarding the notice of pendency. Under CPLR 6515, the Court may direct cancellation of a notice of pendency, provided that the defendant “shall give an undertaking” in an amount such that “adequate relief can be secured to the plaintiff.”1 The plaintiff, in turn, can overcome the cancellation if it commits to an undertaking that will indemnify the defendant for “the damages that he or she may incur if the notice is not cancelled.” This mechanism is often called “double bonding.” Here, the potential harm to the Plaintiff from Defendant’s breaches (and thus Defendant’s appropriate undertaking) is substantial, including the imperilment of the $20 million lease Plaintiff had bargained for and secured for the unit. CPLR 6515 thus effectively anticipates the Court’s concern and provides that if Defendant wishes to sell the disputed unit during this lawsuit, despite Defendant’s prior contractual commitment to deliver it to Plaintiff in the condition agreed-upon under the PSA, then Defendant should give an appropriate undertaking to secure adequate relief for Plaintiff and to ensure that the transaction in which it seeks to engage not impair a future judgment on the claims in this action. A substantial body of case law and commentary further supports this approach.2 1 “Undertaking” is defined in CPLR 2501. 2 See Andesco, Inc. v. Page, 137 A.D.2d 349, 358 (1st Dep’t 1988) (reversing cancellation of notice of pendency “because no obligation for a bond was placed on defendant seller”); Mattone Grp. v. Telesector At times, defendants subject to a notice of pendency have attempted to satisfy CPLR 6515’s undertaking requirement by proposing to pledge the proceeds of any sale of the subject property as the security for lifting the notice of pendency.3 The courts presented with those proposals have held that such a proposal clearly does not satisfy the CPLR’s undertaking requirement. Id. However, in the interest of working reasonably and in good faith with Defendant and the Court, Plaintiff is open to discussing a consensual solution to lifting the notice of pendency that would involve Defendant committing the proceeds of its sale of the property as security.4 For whatever reason, Defendant originally elected not to seek cancellation of the notice of pendency under CPLR 6515, and instead moved only under CPLR 6514—which Defendant cannot satisfy for the reasons discussed in Plaintiff’s prior submissions. In the interest of reaching a just and reasonable resolution, however, Plaintiff submits that CPLR 6515 provides the appropriate framework for evaluating any putative grievance with the notice of pendency, and Plaintiff stands ready to discuss that framework at the parties’ upcoming hearing on December 2. We thank the Court for its time and attention to this matter. Respectfully, /s/ Jason Cyrulnik Jason Cyrulnik cc: Counsel of record (by NYSCEF) Res. Grp., 2008 WL 412612, at *1 (Sup. Ct. Queens Cty. 2008) (requiring undertaking for cancellation of notice of pendency and setting undertaking at amount that would compensate for loss of valuable contract); see also, e.g., Bobash, Inc. v. Festinger, 57 A.D.3d 464, 466 (2d Dep’t 2008) (permitting cancellation of notice of pendency “conditioned upon the appellants’ posting of an undertaking”); Kim v. HFZ 11 Beach St. LLC, 2021 WL 2548337, at *1 (Sup. Ct. N.Y. Cty. 2021) (ordering undertaking for $4.375 million, which “approximates the damages the plaintiff would incur if the property were improperly sold to a third party”), aff’d 199 A.D.3d 415 (1st Dep’t 2021); Seidler v. Workable Atlantic LLC, 2020 WL 2198232, at *5 (Sup. Ct. Kings Cty. 2020) (requiring undertaking in amount of plaintiff’s potential damages of $8.3 million); N.Y.C. Energy Efficiency Corp. v. Suria, 2019 WL 587433, at *4-5 (Sup. Ct. N.Y. Cty. 2019) (rejecting argument that notice of pendency could be cancelled under CPLR 6515 without a proper undertaking by defendants); Corvera v. Prime Source Dev. LLC, 2017 WL 11493809, at *3 (Sup. Ct. Nassau Cty. 2017) (requiring undertaking for cancellation of notice of pendency); Grinshpun v. Gennady, 2016 WL 5848834, at *3–4 (Sup. Ct. N.Y. Cty. 2016) (refusing to cancel notice of pendency without undertaking); U.S. v. Cohn, 1987 WL 8345, at *1-2 (S.D.N.Y. 1987) (“I have not found any case, and the present defendants have cited none, where over objection of the party filing a valid notice of pendency, his adversary has been permitted to cancel that notice without first giving the sort of financial undertaking defined by section 2501.”); CPLR 6515 Practice Commentary (“The defendant’s undertaking is intended to give the plaintiff a form of monetary security—‘adequate relief’—in substitution for the property itself.”) (collecting cases). 3 See Weksler v. Yaffe, 129 Misc. 2d 633, 637-38 (Sup. Ct. Kings Cty. 1985); U.S. v. Cohn, 1987 WL 8345, at *1-2 (S.D.N.Y. 1987). 4 Cf. Cohn, 1987 WL 8345, at *1-2 (discussing cases that involve “consent by the party obtaining the lis pendens”). 2