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UD) OUN IK 06 DV INDEX NO. 51573/2015
NYSCEF BOC. NO. 8 RECEIVED NYSCEF: 06/02/2015
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF WESTCHESTER
wenn ene ene ene eee XK
CDC DEVELOPMENT PROPERTIES, INC., Index No.: 51537/2015
Plaintiff, AFFIRMATION IN SUPPORT
OF CROSS- MOTION TO
- against - EXTEND TIME TO ANSWER
AND IN OPPOSITION TO
AMERICAN INDEPENDENT PAPER MILLS DEFENDANTS MOTION
SUPPLY CO., INC. and HUDSON HARBOR FOR DEFAULT AND FOR
HOMES, INC., SUMMARY JUDGMENT
Defendants.
weet eee e eee nnn nnn ee eee nee ene X
HOWARD P. KLAR, an attorney duly admitted to practice Jaw in the courts of the State
of New York, affirms the following under the penalties of perjury:
1 I am a member of Gallo Vitucci Klar LLP, attorney for Plaintiff CDC
DEVELOPMENT PROPERTIES, INC. (hereinafter referred to as “Plaintiff” and/or “CDC”) and
I submit this affirmation in support of Plaintiff's CDC’s Cross-Motion for an Order under CPLR.
3102(d) to extend its time to serve and file an answer or, in the alternative, to compel plaintiffs to
accept service of defendant’s Answer and for such other and further relief as this Court deems
just and proper.
2 I also submit this affirmation in opposition to defendants American Independent
Paper Mills Supply Co., Inc.’s (“AIP”) motion to enter a default judgment and for summary
judgment as against Plaintiff.
3 This Court should exercise its discretion in granting plaintiff's cross-motion
because CDC has a meritorious defense and a reasonable excuse for the mere 22 day delay in
answering Defendants counter claims. The determination of what constitutes a reasonable excuse
for a default lies within the sound discretion of the court. See Yonkers Rib House, Inc. v. 1789
Cent. Park Corp., 19 A.D.3d 687, 799 N.Y.S.2d 62 (2d Dept. 2005). Moreover, CDC’s default
was not willful and defendant AIP was not prejudiced from the delay.
4 Courts have broad discretion to grant relief “where the moving party’s claim or
defense is meritorious, the default was not willful, and the other party is not prejudiced”
(Goldman v. City of New York, 287 A.D.2d 482, 483, 731 N.Y.S.2d 212 [2d Dept. 2001]. In
Goldman, the Second Department affirmed the lower court’s order which denied plaintiff's
motion for a default judgment and granted defendant’s cross motion to extend defendant’s time
to serve his answer even though defendants were approximately four months late.
5 In this case, CDC’s answer to Defendant AIP’s Counter Claims was due on April
20, 2015. An Answer was prepared by this office shortly after AIP’s Answer was served with
counter-claims on or about March 20, 2015. It was believed that our Answer to AIP’s counter-
claims (“Answer”) was filed with the court by my secretary and staff, however, once we received
notice of defendant’s motion, we immediately realized that the Answer was not in fact filed. It
was shortly thereafter that we served said Answer on the NYSCEF filing system on May 12,
2015; a mere 22 days late. A copy of same is annexed hereto as Exhibit “A”.
6. A copy of CDC’s Answer was then sent via overnight delivery to defendant’s
counsel with a cover letter requesting that he withdraw the portion of his motion for a default.
However, Defense counsel failed to respond to my request necessitating this cross motion. A
copy of said letter is annexed hereto as Exhibit “B”. IT should be noted that Defense counsel
never made any good faith attempt to notify this office of the fat that the Answer had not been
served nor had counsel made any effort to resolve this matter without resort to formal motion.
CDC’s Meritorious Defense
A CDC Did Not Breach the Lease for Failure to Deliver A Fully Executed
Tenant Estoppel Certificate as Per the Lease
15. Defendant’s first counter-claim for breach of lease alleges that CDC breached the
lease by failing to deliver an executed tenant estoppel certificate (‘Estoppel Certificate”) in
accordance with the requirements of the lease. A copy of said Estoppel Certificate is attached
hereto as Exhibit “F”.
16. Defendants’ further alleged that said breach caused AIP to be “deprived of the
benefit of its bargain as contained in the Purchase and Sale Agreement between AIP and Hudson
Harbor Homes, Inc. (“HHH”)”, who was the proposed purchaser of the subject premises.
17. First, it shall be noted that there is no evidence whatsoever to support defendant’s
claims that CDC breached the lease agreement by failing to execute an Estoppel Certificate “in
accordance with the requirements of the lease” since Plaintiff's, from the moment they received
the Estoppel Certificate, always maintained the position that they were ready, willing and able to
sign the Estoppel Certificate, however, that there were certain maintenance issues and
overpayment of real estate taxes that had to be addressed and resolved in order to preserve
CDC’s rights under the lease. Instead, AIP refused to engage in any type of meaningful
discussion with CDC, after numerous attempts to do so, to resolve these issues so that CDC
could execute the Estoppel Certificate that was provided to them by AIP. Essentially, AIP was
looking for CDC to sign said Estoppel Certificate in its present form without addressing the
pending issues between AIP and CDC, thereby misrepresenting the condition of the premises to
HHH, in an attempt to not deal with said issues and instead attempt to pass these issues to HHH
once the premises was sold to them.
11. It shall be noted that after the many courtesies that we have extended to defense
counsel in this matter, never once did he call this office or notify us in any way that an Answer to
defendant’s counter claims was overdo and to see whether in fact an Answer would be served in
an effort to avoid unnecessary and frivolous motion practice.
12. On May 12, 2015, the same date the Answer was served electronically, we also
drafted a letter enclosing a courtesy copy of the Answer requesting that defense counsel
withdraw the portion of his motion seeking a default judgment against CDC. However, to date,
we did not receive any response to our letter. Had defendant’s counsel informed this office of
the default, CDC would have made sure that they submitted their answer and this default motion
would not have been necessary. A copy of said letter to defense counsel is attached hereto as
Exhibit “B”.
13. To paraphrase the Second Department in Sumner v. Reich, 92 A.D.2d 590,
591,459 N.Y.S.2d 481 (2d Dept. 1983), in view of the insignificance of the subject delay, the
absence of prejudice, the existence of a meritorious defense, this litigation should have been
averted and the matter resolved by the extension of professional courtesy between counsel.
14. Law office failure is a valid excuse that may be offered as a reasonable excuse to
justify a failure to act which resulted in a default ruling or default judgment. See CPLR Section
2005 (McKinney's 2005). See also Valure v. Century 21 Grand, 35 A.D.3d 591,826 N.Y.S.2d
418 (2d Dept. 2006) [The Supreme Court improvidently exercised its discretion in rejecting
defendants’ excuse of law office failure]. The within Affirmation establishes “that the failure to
submit a timely answer was not willful, but rather, was due to law office failure” (Thompson v.
County of Suffolk, 61 A.D.3d 962, 878 N.Y.S.2d 181 [2d Dept.2009}).
CDC’s Meritorious Defens:
A CDC Did Not Breach the Lease for Failure to Deliver A Fully Executed
Tenant Estoppel Certificate as Per the Lease
15. Defendant’s first counter-claim for breach of lease alleges that CDC breached the
lease by failing to deliver an executed tenant estoppel certificate (“Estoppel Certificate”) in
accordance with the requirements of the lease. A copy of said Estoppel Certificate is attached
hereto as Exhibit “C”.
16. Defendants’ further alleged that said breach caused AIP to be “deprived of the
benefit of its bargain as contained in the Purchase and Sale Agreement between AIP and Hudson
Harbor Homes, Inc. (“HHH”)”, who was the proposed purchaser of the subject premises.
17. First, it shall be noted that there is no evidence whatsoever to support defendant’s
claims that CDC breached the lease agreement by failing to execute an Estoppel Certificate
accordance with the requirements of the lease” since Plaintiff's, from the moment they received
the Estoppel Certificate, always maintained the position that they were ready, willing and able to
sign the Estoppel Certificate, however, that there were certain maintenance issues and
overpayment of real estate taxes that had to be addressed and resolved in order to preserve
CDC’s rights under the lease. Instead, AIP refused to engage in any type of meaningful
discussion with CDC, after numerous attempts to do so, to resolve these issues so that CDC
could execute the Estoppel Certificate that was provided to them by AIP. Essentially, AIP was
looking for CDC to sign said Estoppel Certificate in its present form without addressing the
pending issues between AIP and CDC, thereby misrepresenting the condition of the premises to
HHH, in an attempt to not deal with said issues and instead attempt to pass these issues to HHH
once the premises was sold to them.
18. Pursuant to Paragraph 6 of the Estoppel Certificate it states that the “Landlord
(AIP) is not obligated to perform any work in the Demised Premises for Tenant or to provide to
Tenant any allowance”. Furthermore, pursuant to Paragraph 7 of the Estoppel Certificate, it
states the following:
“As of the date hereof: (i) there exists no breach, default, or event or condition which,
with the giving of notice or the passage of time or both, would constitute a breach or
default by...Landlord under the Lease; and (ii) Tenant has no existing claims, defenses or
offsets against rental due or to become due under the Lease.”
19. Plaintiff never signed the Estoppel Certificate without preserving its rights
beforehand. To do so would essentially waive CDC’s rights under the lease for said roof repairs
and overpayment of real estate taxes, as further explained below.
20. On August 14, 2014, Plaintiff notified defendant AIP in writing that there were
several maintenance issues, particularly with reference to various leaks in the roof of the subject
premises, which were affecting Plaintiffs business that needed to be addressed prior to CDC
being able to execute said Estoppel Certificate. It shall be further noted that pursuant to the
Lease, it was AIP’s sole obligation to conduct said roof repairs. (A copy of said letter dated
August 14, 2014 is annexed hereto as Exhibit “D”) However, AIP failed to discuss and resolve
these matters with CDC and again demanded that an executed Estoppel Certificate be provided
by CDC.
21. On August 19, 2014, in response to CDC’s letter, instead of AIP addressing the
outstanding issues or concerns that CDC legitimately had, AIP advised CDC that they were in
alleged default with the lease since CDC had not yet provided a signed Estoppel Certificate and
advised that CDC had thirty days to cure said default otherwise they would be in breach of the
lease. A copy of said letter is attached hereto as Exhibit “E “.
22. Therefore, on September 9, 2014, CDC, in response to AIP’s letter and in good
faith, provided AIP with an executed Estoppel Certificate with an attached proposed Rider which
preserved CDC’s rights regarding the roof maintenance and repair issues that still needed to be
resolved and also addressed the credit that was due to CDC for the overpayment of real estate
taxes. As such, CDC cured said alleged default well within the thirty day cure period as
prescribed by AIP and requested again to speak to AIP to resolve said issues. A copy of said
letter with attached executed Tenant Estoppel Certificate with Rider is attached hereto as Exhibit
“Rp,
23. It is clear from the above that there is no evidence whatsoever that CDC, by
delivering said Estoppel Certificate and attached Rider to AIP within the requisite cure period of
thirty days, in any way breached the lease and thereby deprived AIP the benefit of selling the
subject premises to HHH; as CDC was merely preserving their rights under the lease.
B. CDC’s Actions Did Not In Any Way Result In Tortious Interference With AIP’s
Contractual Relationship
24. In order for defendant AIP to prove a claim of tortious interference with a
contractual relationship, AIP must prove the following elements: (1) the existence of a valid
contract between the defendant and a third party; (2) plaintiff's knowledge of the contract; (3)
plaintiff's intentional inducement of the third party to breach or otherwise render performance
impossible; (4) actual breach of the contract and (5) damages resulting therefrom. Pabon v.
Many, 99 A.D.3d 773, 774 (2d Dep’t, 2012); Lama Holding Co. v. Smith Barney, Inc., 88
N.Y.2d 413, 424 (1996).
25. Even though CDC was made aware by AIP that HHH was allegedly in contract to
purchase the subject premises, CDC never saw the contract of sale, nor has defendant produced
same, did not have any knowledge of the terms of the contract and whether the contract was in
fact valid. More importantly, there is no evidence whatsoever to establish that CDC’s actions to
preserve their right to have certain roof repairs made and certain real estate tax credit’s addressed
with AIP, which are Plaintiff's underlying claims pursuant to the instant action, constitutes an
“intentional inducement” on behalf of CDC to induce HHH to cancel its contract with AIP to
purchase the subject premises.
26. As there has been no prejudice to Defendants and the circumstances demonstrate
any delay was not willful, it is submitted that the Defendants should be compelled to accept
Plaintiff's Answer to Defendants counterclaims.
27. All four appellate departments have stated repeatedly that there is a “strong public
policy in favor of resolving claims on the merits.” The Second Department recently revered an
order granting a default judgment and vacated a $3.5 million judgment pointing out that “a
disposition on the merits is favored”. Gerdes v. Canales, A.D.3d_, _N.Y.S.2d_, 2010 WL
2404315 [2d Dept. 2010]). See also Watt v. Spencer, 36 A.D.3d 446, 758 N.Y.S.2d 638 (1
Dept. 2003) [strong public policy of the courts in favor of deciding cases on their merits];
Watson v. Pollacchi, 32 A.D.3d 565, 819 N.Y.S.2d 612 (3d Dept. 2006) [trial court did not abuse
its discretion in accepting law office failure given public policy favoring resolution of cases on
the merits].
28. Based upon the above and as further elaborated by Kevin Kaye’s affidavit, the
managing shareholder of CDC, CDC’s case should be decided on the merits.
29. Furthermore, as there has been virtually no discover in this case, defendants
would not be prejudiced by the insignificant delay.
Plaintiff's Claims Should Not Be Dismissed As A Matter Of Law As They Are Not
Time Barred By Section 213 Of The CPLR
30. Defendant’s claim that the breach of the lease occurred on September 18, 2008
when Hon. John R. LaCava, JSC issued an order granting AIP a reduction of assessed value of
the property is completely false and a misrepresentation of Plaintiff's claims as against the
Defendant. Instead, the breach of lease was continuous as it occurred each and every month after
said Order was issued when the Defendants failed to credit CDC its proportionate share of the
tax refund that Defendant obtained from the Court and when Defendants failed to adjust
Plaintiff's monthly rent payments and tax payments made each and every month thereafter the
Court Order was issued.
31. Furthermore, it shall be noted that AIP never provided notice to the Plaintiff of
the issuance of said Order or of the tax refund that was obtained by AIP as CDC was not a party
of AIP’s action as against the Town of Greenburgh and AIP never provided any written notice
whatsoever to the Plaintiff notifying them of the Order. As such, Plaintiff had no way of
knowing that said Order was issued unless AIP advised CDC accordingly; which they clearly
failed to do so.
32. Plaintiffs became aware of said Order and its findings through their own due
diligence and investigation of the Court’s and Town of Greenburgh’s records through their
attorneys, Gallo Vitucci Klar LLP.
33. It shall be noted that the general rule applicable to contract actions is that a six-
year statute of limitations begins to run when a contract is breached or when one party omits the
performance of a contractual obligation (State_of New York v Fenton, 68 AD2d 951; 18
Williston, Contracts [3d ed], § 2021 A, p 697). However, where a contract provides for
continuing performance over a period of time, each breach may begin the running of the statute
anew such that accrual occurs continuously and plaintiffs may assert claims for damages
occurring up to six years prior to filing of the suit (Bulova Watch Co. v Celotex Corp., 46 N.Y.2d
606).
34, Here, a new cause of action for breach of contract occurred each and every month
after the Order was issued from October 2008 to the time that plaintiff filed suit as against
Defendant in February 2015 and as such, Plaintiff’s claim for breach of contract is thereby timely
made.
35. Inasmuch as an issue of fact exists with respect to Defendant’s obligations under
the Lease and it is not yet possible to determine the issue of accrual of alleged breaches of the
contract so early in the litigation, where a triable issue of fact exists with respect to accrual of a
claim, such issue should not be determined on motion (Orloff Towers v Vermilya-Brown Co., 50
AD2d 740). As such, Plaintiffs claim should not be dismissed as against Defendant as clearly
Plaintiff's action is deemed timely and it is respectfully requested that this portion of
Defendant’s motion should be readily denied.
Plaintiff's Execution of An Estoppel_Certificate Does Not Constitute Evidenc
That Plaintiff Has Waived It’s Breach Of Contract Claims As Against Defendant
36. It is further noted that the Estoppel Certificate has no bearing on the party’s
responsibilities pursuant to the Lease and is extrinsic evidence which is not determinative in the
breach of contract action as against Defendants.
37. There is no evidence whatsoever to establish that the Estoppel Certificate was
prepared to supersede the Lease terms and that whatever statements enclosed in said Estoppel
Certificate would then bar CDC from ever claiming a breach of contract claim as against AIP.
38. Instead, the Estoppel Certificate was issued for the purpose of enabling HHH, the
prospective buyer for the subject premises, to conduct its due diligence with respect to the
10
purchase of the subject premises and to protect itself against any claims for breach of contract
that the Plaintiff CDC would have against AIP, not HHH.
39. Furthermore, as stated above and as stated in Defendant’s own motion papers,
CDC did preserve its rights and made clear from the inception of its claim as against AIP for
breach of the Lease.
40. Specifically, in paragraph 19 of the Defendant’s moving papers, AIP admits that
Plaintiffs did in fact preserve their rights to a breach of lease claim as against AIP in their cover
letter dated September 17, 2014 to the executed Estoppel Certificate. Then later on in AIP’s
motion papers, AIP contradicts itself by later stating in Paragraph 22, that CDC, by executing
said Estoppel Certificate, conceded to the fact that no claims for breach of contract existed as
against AIP. However, AIP cannot have it both ways.
41. Furthermore, it should be made clear that Defendant’s attempt to use the Estoppel
Certificate as evidence that Plaintiff has no viable breach of contract claim as against Defendant
is completely baseless and irrelevant as said Estoppel Certificate was solely used to facilitate the
sale of the subject premises to HHH, nothing more. Furthermore, it is clear by the documentary
evidence that CDC preserved its rights to a breach of lease claim as against AIP.
42. Therefore, based upon the above and based upon the fact that Defendant’s breach
of the Lease was continuous, Defendant’s motion to dismiss Plaintiffs complaint for failure to
commence said action within the requisite statute of limitations for breach of contract should be
summarily dismissed in its entirety.
Defendants Are Not Entitled To Attorney’s Fees In Connection With Said Action
43. In the provisions of the Lease that the Defendant’s reference to, specifically
Paragraphs 18, 19 and 54, it clearly states that the Defendant’s would only be entitled to
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attorney’s fees from the Plaintiff if the Defendant were to bring an action against the Plaintiff for
non-payment of rent or other default and that if the Defendant were successful in bringing said
action, they would then be entitled to said attorney’s fees. However, in this case, these provisions
do not apply since the Plaintiff did not in any way breach the aforementioned Lease for either
non-payment of rent or under any other covenant under the Lease. The only party that clearly
breached the Lease is the Defendant itself, and Defendants have failed to provide any evidence to
the contrary.
44 Therefore, Plaintiff respectfully request that Defendant’s request for attorney’s
fees as against the Plaintiff be denied as Plaintiff did not in any way breach the Lease.
WHEREFORE, it is respectfully requested that Plaintiff's motion be granted in its
entirety.
Dated: New York, New York
June 2, 2015
HOWARD P. KLAR
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UD) OUN IK 06 DV INDEX NO. 51573/2015 NYSCEF BOC. NO. 8 RECEIVED NYSCEF: 06/02/2015 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF WESTCHESTER wenn ene ene ene eee XK CDC DEVELOPMENT PROPERTIES, INC., Index No.: 51537/2015 Plaintiff, AFFIRMATION IN SUPPORT OF CROSS- MOTION TO - against - EXTEND TIME TO ANSWER AND IN OPPOSITION TO AMERICAN INDEPENDENT PAPER MILLS DEFENDANTS MOTION SUPPLY CO., INC. and HUDSON HARBOR FOR DEFAULT AND FOR HOMES, INC., SUMMARY JUDGMENT Defendants. weet eee e eee nnn nnn ee eee nee ene X HOWARD P. KLAR, an attorney duly admitted to practice Jaw in the courts of the State of New York, affirms the following under the penalties of perjury: 1 I am a member of Gallo Vitucci Klar LLP, attorney for Plaintiff CDC DEVELOPMENT PROPERTIES, INC. (hereinafter referred to as “Plaintiff” and/or “CDC”) and I submit this affirmation in support of Plaintiff's CDC’s Cross-Motion for an Order under CPLR. 3102(d) to extend its time to serve and file an answer or, in the alternative, to compel plaintiffs to accept service of defendant’s Answer and for such other and further relief as this Court deems just and proper. 2 I also submit this affirmation in opposition to defendants American Independent Paper Mills Supply Co., Inc.’s (“AIP”) motion to enter a default judgment and for summary judgment as against Plaintiff. 3 This Court should exercise its discretion in granting plaintiff's cross-motion because CDC has a meritorious defense and a reasonable excuse for the mere 22 day delay in answering Defendants counter claims. The determination of what constitutes a reasonable excuse for a default lies within the sound discretion of the court. See Yonkers Rib House, Inc. v. 1789 Cent. Park Corp., 19 A.D.3d 687, 799 N.Y.S.2d 62 (2d Dept. 2005). Moreover, CDC’s default was not willful and defendant AIP was not prejudiced from the delay. 4 Courts have broad discretion to grant relief “where the moving party’s claim or defense is meritorious, the default was not willful, and the other party is not prejudiced” (Goldman v. City of New York, 287 A.D.2d 482, 483, 731 N.Y.S.2d 212 [2d Dept. 2001]. In Goldman, the Second Department affirmed the lower court’s order which denied plaintiff's motion for a default judgment and granted defendant’s cross motion to extend defendant’s time to serve his answer even though defendants were approximately four months late. 5 In this case, CDC’s answer to Defendant AIP’s Counter Claims was due on April 20, 2015. An Answer was prepared by this office shortly after AIP’s Answer was served with counter-claims on or about March 20, 2015. It was believed that our Answer to AIP’s counter- claims (“Answer”) was filed with the court by my secretary and staff, however, once we received notice of defendant’s motion, we immediately realized that the Answer was not in fact filed. It was shortly thereafter that we served said Answer on the NYSCEF filing system on May 12, 2015; a mere 22 days late. A copy of same is annexed hereto as Exhibit “A”. 6. A copy of CDC’s Answer was then sent via overnight delivery to defendant’s counsel with a cover letter requesting that he withdraw the portion of his motion for a default. However, Defense counsel failed to respond to my request necessitating this cross motion. A copy of said letter is annexed hereto as Exhibit “B”. IT should be noted that Defense counsel never made any good faith attempt to notify this office of the fat that the Answer had not been served nor had counsel made any effort to resolve this matter without resort to formal motion. CDC’s Meritorious Defense A CDC Did Not Breach the Lease for Failure to Deliver A Fully Executed Tenant Estoppel Certificate as Per the Lease 15. Defendant’s first counter-claim for breach of lease alleges that CDC breached the lease by failing to deliver an executed tenant estoppel certificate (‘Estoppel Certificate”) in accordance with the requirements of the lease. A copy of said Estoppel Certificate is attached hereto as Exhibit “F”. 16. Defendants’ further alleged that said breach caused AIP to be “deprived of the benefit of its bargain as contained in the Purchase and Sale Agreement between AIP and Hudson Harbor Homes, Inc. (“HHH”)”, who was the proposed purchaser of the subject premises. 17. First, it shall be noted that there is no evidence whatsoever to support defendant’s claims that CDC breached the lease agreement by failing to execute an Estoppel Certificate “in accordance with the requirements of the lease” since Plaintiff's, from the moment they received the Estoppel Certificate, always maintained the position that they were ready, willing and able to sign the Estoppel Certificate, however, that there were certain maintenance issues and overpayment of real estate taxes that had to be addressed and resolved in order to preserve CDC’s rights under the lease. Instead, AIP refused to engage in any type of meaningful discussion with CDC, after numerous attempts to do so, to resolve these issues so that CDC could execute the Estoppel Certificate that was provided to them by AIP. Essentially, AIP was looking for CDC to sign said Estoppel Certificate in its present form without addressing the pending issues between AIP and CDC, thereby misrepresenting the condition of the premises to HHH, in an attempt to not deal with said issues and instead attempt to pass these issues to HHH once the premises was sold to them. 11. It shall be noted that after the many courtesies that we have extended to defense counsel in this matter, never once did he call this office or notify us in any way that an Answer to defendant’s counter claims was overdo and to see whether in fact an Answer would be served in an effort to avoid unnecessary and frivolous motion practice. 12. On May 12, 2015, the same date the Answer was served electronically, we also drafted a letter enclosing a courtesy copy of the Answer requesting that defense counsel withdraw the portion of his motion seeking a default judgment against CDC. However, to date, we did not receive any response to our letter. Had defendant’s counsel informed this office of the default, CDC would have made sure that they submitted their answer and this default motion would not have been necessary. A copy of said letter to defense counsel is attached hereto as Exhibit “B”. 13. To paraphrase the Second Department in Sumner v. Reich, 92 A.D.2d 590, 591,459 N.Y.S.2d 481 (2d Dept. 1983), in view of the insignificance of the subject delay, the absence of prejudice, the existence of a meritorious defense, this litigation should have been averted and the matter resolved by the extension of professional courtesy between counsel. 14. Law office failure is a valid excuse that may be offered as a reasonable excuse to justify a failure to act which resulted in a default ruling or default judgment. See CPLR Section 2005 (McKinney's 2005). See also Valure v. Century 21 Grand, 35 A.D.3d 591,826 N.Y.S.2d 418 (2d Dept. 2006) [The Supreme Court improvidently exercised its discretion in rejecting defendants’ excuse of law office failure]. The within Affirmation establishes “that the failure to submit a timely answer was not willful, but rather, was due to law office failure” (Thompson v. County of Suffolk, 61 A.D.3d 962, 878 N.Y.S.2d 181 [2d Dept.2009}). CDC’s Meritorious Defens: A CDC Did Not Breach the Lease for Failure to Deliver A Fully Executed Tenant Estoppel Certificate as Per the Lease 15. Defendant’s first counter-claim for breach of lease alleges that CDC breached the lease by failing to deliver an executed tenant estoppel certificate (“Estoppel Certificate”) in accordance with the requirements of the lease. A copy of said Estoppel Certificate is attached hereto as Exhibit “C”. 16. Defendants’ further alleged that said breach caused AIP to be “deprived of the benefit of its bargain as contained in the Purchase and Sale Agreement between AIP and Hudson Harbor Homes, Inc. (“HHH”)”, who was the proposed purchaser of the subject premises. 17. First, it shall be noted that there is no evidence whatsoever to support defendant’s claims that CDC breached the lease agreement by failing to execute an Estoppel Certificate accordance with the requirements of the lease” since Plaintiff's, from the moment they received the Estoppel Certificate, always maintained the position that they were ready, willing and able to sign the Estoppel Certificate, however, that there were certain maintenance issues and overpayment of real estate taxes that had to be addressed and resolved in order to preserve CDC’s rights under the lease. Instead, AIP refused to engage in any type of meaningful discussion with CDC, after numerous attempts to do so, to resolve these issues so that CDC could execute the Estoppel Certificate that was provided to them by AIP. Essentially, AIP was looking for CDC to sign said Estoppel Certificate in its present form without addressing the pending issues between AIP and CDC, thereby misrepresenting the condition of the premises to HHH, in an attempt to not deal with said issues and instead attempt to pass these issues to HHH once the premises was sold to them. 18. Pursuant to Paragraph 6 of the Estoppel Certificate it states that the “Landlord (AIP) is not obligated to perform any work in the Demised Premises for Tenant or to provide to Tenant any allowance”. Furthermore, pursuant to Paragraph 7 of the Estoppel Certificate, it states the following: “As of the date hereof: (i) there exists no breach, default, or event or condition which, with the giving of notice or the passage of time or both, would constitute a breach or default by...Landlord under the Lease; and (ii) Tenant has no existing claims, defenses or offsets against rental due or to become due under the Lease.” 19. Plaintiff never signed the Estoppel Certificate without preserving its rights beforehand. To do so would essentially waive CDC’s rights under the lease for said roof repairs and overpayment of real estate taxes, as further explained below. 20. On August 14, 2014, Plaintiff notified defendant AIP in writing that there were several maintenance issues, particularly with reference to various leaks in the roof of the subject premises, which were affecting Plaintiffs business that needed to be addressed prior to CDC being able to execute said Estoppel Certificate. It shall be further noted that pursuant to the Lease, it was AIP’s sole obligation to conduct said roof repairs. (A copy of said letter dated August 14, 2014 is annexed hereto as Exhibit “D”) However, AIP failed to discuss and resolve these matters with CDC and again demanded that an executed Estoppel Certificate be provided by CDC. 21. On August 19, 2014, in response to CDC’s letter, instead of AIP addressing the outstanding issues or concerns that CDC legitimately had, AIP advised CDC that they were in alleged default with the lease since CDC had not yet provided a signed Estoppel Certificate and advised that CDC had thirty days to cure said default otherwise they would be in breach of the lease. A copy of said letter is attached hereto as Exhibit “E “. 22. Therefore, on September 9, 2014, CDC, in response to AIP’s letter and in good faith, provided AIP with an executed Estoppel Certificate with an attached proposed Rider which preserved CDC’s rights regarding the roof maintenance and repair issues that still needed to be resolved and also addressed the credit that was due to CDC for the overpayment of real estate taxes. As such, CDC cured said alleged default well within the thirty day cure period as prescribed by AIP and requested again to speak to AIP to resolve said issues. A copy of said letter with attached executed Tenant Estoppel Certificate with Rider is attached hereto as Exhibit “Rp, 23. It is clear from the above that there is no evidence whatsoever that CDC, by delivering said Estoppel Certificate and attached Rider to AIP within the requisite cure period of thirty days, in any way breached the lease and thereby deprived AIP the benefit of selling the subject premises to HHH; as CDC was merely preserving their rights under the lease. B. CDC’s Actions Did Not In Any Way Result In Tortious Interference With AIP’s Contractual Relationship 24. In order for defendant AIP to prove a claim of tortious interference with a contractual relationship, AIP must prove the following elements: (1) the existence of a valid contract between the defendant and a third party; (2) plaintiff's knowledge of the contract; (3) plaintiff's intentional inducement of the third party to breach or otherwise render performance impossible; (4) actual breach of the contract and (5) damages resulting therefrom. Pabon v. Many, 99 A.D.3d 773, 774 (2d Dep’t, 2012); Lama Holding Co. v. Smith Barney, Inc., 88 N.Y.2d 413, 424 (1996). 25. Even though CDC was made aware by AIP that HHH was allegedly in contract to purchase the subject premises, CDC never saw the contract of sale, nor has defendant produced same, did not have any knowledge of the terms of the contract and whether the contract was in fact valid. More importantly, there is no evidence whatsoever to establish that CDC’s actions to preserve their right to have certain roof repairs made and certain real estate tax credit’s addressed with AIP, which are Plaintiff's underlying claims pursuant to the instant action, constitutes an “intentional inducement” on behalf of CDC to induce HHH to cancel its contract with AIP to purchase the subject premises. 26. As there has been no prejudice to Defendants and the circumstances demonstrate any delay was not willful, it is submitted that the Defendants should be compelled to accept Plaintiff's Answer to Defendants counterclaims. 27. All four appellate departments have stated repeatedly that there is a “strong public policy in favor of resolving claims on the merits.” The Second Department recently revered an order granting a default judgment and vacated a $3.5 million judgment pointing out that “a disposition on the merits is favored”. Gerdes v. Canales, A.D.3d_, _N.Y.S.2d_, 2010 WL 2404315 [2d Dept. 2010]). See also Watt v. Spencer, 36 A.D.3d 446, 758 N.Y.S.2d 638 (1 Dept. 2003) [strong public policy of the courts in favor of deciding cases on their merits]; Watson v. Pollacchi, 32 A.D.3d 565, 819 N.Y.S.2d 612 (3d Dept. 2006) [trial court did not abuse its discretion in accepting law office failure given public policy favoring resolution of cases on the merits]. 28. Based upon the above and as further elaborated by Kevin Kaye’s affidavit, the managing shareholder of CDC, CDC’s case should be decided on the merits. 29. Furthermore, as there has been virtually no discover in this case, defendants would not be prejudiced by the insignificant delay. Plaintiff's Claims Should Not Be Dismissed As A Matter Of Law As They Are Not Time Barred By Section 213 Of The CPLR 30. Defendant’s claim that the breach of the lease occurred on September 18, 2008 when Hon. John R. LaCava, JSC issued an order granting AIP a reduction of assessed value of the property is completely false and a misrepresentation of Plaintiff's claims as against the Defendant. Instead, the breach of lease was continuous as it occurred each and every month after said Order was issued when the Defendants failed to credit CDC its proportionate share of the tax refund that Defendant obtained from the Court and when Defendants failed to adjust Plaintiff's monthly rent payments and tax payments made each and every month thereafter the Court Order was issued. 31. Furthermore, it shall be noted that AIP never provided notice to the Plaintiff of the issuance of said Order or of the tax refund that was obtained by AIP as CDC was not a party of AIP’s action as against the Town of Greenburgh and AIP never provided any written notice whatsoever to the Plaintiff notifying them of the Order. As such, Plaintiff had no way of knowing that said Order was issued unless AIP advised CDC accordingly; which they clearly failed to do so. 32. Plaintiffs became aware of said Order and its findings through their own due diligence and investigation of the Court’s and Town of Greenburgh’s records through their attorneys, Gallo Vitucci Klar LLP. 33. It shall be noted that the general rule applicable to contract actions is that a six- year statute of limitations begins to run when a contract is breached or when one party omits the performance of a contractual obligation (State_of New York v Fenton, 68 AD2d 951; 18 Williston, Contracts [3d ed], § 2021 A, p 697). However, where a contract provides for continuing performance over a period of time, each breach may begin the running of the statute anew such that accrual occurs continuously and plaintiffs may assert claims for damages occurring up to six years prior to filing of the suit (Bulova Watch Co. v Celotex Corp., 46 N.Y.2d 606). 34, Here, a new cause of action for breach of contract occurred each and every month after the Order was issued from October 2008 to the time that plaintiff filed suit as against Defendant in February 2015 and as such, Plaintiff’s claim for breach of contract is thereby timely made. 35. Inasmuch as an issue of fact exists with respect to Defendant’s obligations under the Lease and it is not yet possible to determine the issue of accrual of alleged breaches of the contract so early in the litigation, where a triable issue of fact exists with respect to accrual of a claim, such issue should not be determined on motion (Orloff Towers v Vermilya-Brown Co., 50 AD2d 740). As such, Plaintiffs claim should not be dismissed as against Defendant as clearly Plaintiff's action is deemed timely and it is respectfully requested that this portion of Defendant’s motion should be readily denied. Plaintiff's Execution of An Estoppel_Certificate Does Not Constitute Evidenc That Plaintiff Has Waived It’s Breach Of Contract Claims As Against Defendant 36. It is further noted that the Estoppel Certificate has no bearing on the party’s responsibilities pursuant to the Lease and is extrinsic evidence which is not determinative in the breach of contract action as against Defendants. 37. There is no evidence whatsoever to establish that the Estoppel Certificate was prepared to supersede the Lease terms and that whatever statements enclosed in said Estoppel Certificate would then bar CDC from ever claiming a breach of contract claim as against AIP. 38. Instead, the Estoppel Certificate was issued for the purpose of enabling HHH, the prospective buyer for the subject premises, to conduct its due diligence with respect to the 10 purchase of the subject premises and to protect itself against any claims for breach of contract that the Plaintiff CDC would have against AIP, not HHH. 39. Furthermore, as stated above and as stated in Defendant’s own motion papers, CDC did preserve its rights and made clear from the inception of its claim as against AIP for breach of the Lease. 40. Specifically, in paragraph 19 of the Defendant’s moving papers, AIP admits that Plaintiffs did in fact preserve their rights to a breach of lease claim as against AIP in their cover letter dated September 17, 2014 to the executed Estoppel Certificate. Then later on in AIP’s motion papers, AIP contradicts itself by later stating in Paragraph 22, that CDC, by executing said Estoppel Certificate, conceded to the fact that no claims for breach of contract existed as against AIP. However, AIP cannot have it both ways. 41. Furthermore, it should be made clear that Defendant’s attempt to use the Estoppel Certificate as evidence that Plaintiff has no viable breach of contract claim as against Defendant is completely baseless and irrelevant as said Estoppel Certificate was solely used to facilitate the sale of the subject premises to HHH, nothing more. Furthermore, it is clear by the documentary evidence that CDC preserved its rights to a breach of lease claim as against AIP. 42. Therefore, based upon the above and based upon the fact that Defendant’s breach of the Lease was continuous, Defendant’s motion to dismiss Plaintiffs complaint for failure to commence said action within the requisite statute of limitations for breach of contract should be summarily dismissed in its entirety. Defendants Are Not Entitled To Attorney’s Fees In Connection With Said Action 43. In the provisions of the Lease that the Defendant’s reference to, specifically Paragraphs 18, 19 and 54, it clearly states that the Defendant’s would only be entitled to 11 attorney’s fees from the Plaintiff if the Defendant were to bring an action against the Plaintiff for non-payment of rent or other default and that if the Defendant were successful in bringing said action, they would then be entitled to said attorney’s fees. However, in this case, these provisions do not apply since the Plaintiff did not in any way breach the aforementioned Lease for either non-payment of rent or under any other covenant under the Lease. The only party that clearly breached the Lease is the Defendant itself, and Defendants have failed to provide any evidence to the contrary. 44 Therefore, Plaintiff respectfully request that Defendant’s request for attorney’s fees as against the Plaintiff be denied as Plaintiff did not in any way breach the Lease. WHEREFORE, it is respectfully requested that Plaintiff's motion be granted in its entirety. Dated: New York, New York June 2, 2015 HOWARD P. KLAR 12