NASSAU COUNTY ALAM, 8,2002. Plaintiffs Memorandum of Law was submitted on November. and Defendant s Memorandum was submitted on November
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1 -MEMORANDUM DECISION AND ORDER Present: SUPREME COURT - STATE OF NEW YORK NASSAU COUNTY HON. MERYL J. BERKOWITZ, Acting Justice BARBARETTA SINDACATO, INC. D/b/a LACUCINA ITALIANA and THOMAS D. MORAN, Plaintiff(s), -against- INDEX NO.: /00 EUGENE E. CIRANNI and ASRAFUL ALAM, Procedural Backaround This action was tried on July 16, 17, 18, 23, 29, August 1, 5, September 5, 18, 25 and October 8,2002. Plaintiffs Memorandum of Law was submitted on November 7,2002 and Defendant s Memorandum was submitted on November 25,2002. Plaintiff plead six causes of action against Defendant Ciranni. While Defendant, Alam was served, he defaulted and never moved to vacate the default. Accordingly, Plaintiff proceeds herein against Defendant Ciranni. The gravamen of the first cause of action is that Defendant unlawfully refused to provide Plaintiff with possession of the premises 495 Hempstead Turnpike, West Hempstead, thus resulting in the loss of a long term commercial lease and the potential profits derived therefrom. The second cause of action alleges a violation of Real Property Actions and Proceedings Law Section 853, in that Defendant violated Plaintiff s rights to peaceable and quiet enjoyment of the premises, thus causing Plaintiff to surrender its right to possession. Plaintiff seeks treble damages
2 on this cause of action. The third cause of action alleges that there has been an unlawful enrichment of Defendant because Plaintiff improved and renovated the premises. The fourth cause of action is somewhat duplicative of the first, alleging that by denying access to the premises, Defendant has breached the lease. The fifth cause of action is for detrimental reliance, in that Plaintiff leased and purchased equipment for the premises because he believed he had a valid lease. The sixth cause of action for conspiracy was dismissed at trial. Defendant s verified answer denies the allegation of the complaint and pleads numerous affirmative defenses. The first asserts that the damages are speculative. The second asserts that lost profits were not in contemplation of the patties. The third states that there can be no damages which flow from a mere agreement to agree. The fourth alleges that parole evidence is admissible to establish that the writing purported to be the lease herein is not the lease. The fifth is that Plaintiff voluntarily waived any rights they may have had. The sixth alleges that the Plaintiff failed to perform a condition precedent. The seventh alleges that there is no binding contract therefore there can be no tortious interference with same. The eight alleges that the terms of the negotiated agreement were never accepted by Defendants. The ninth asserts that RPAPL section 853 is inapplicable to the instant action. Defendant interposed and additional counterclaim seeking $40, for Plaintiffs use and occupancy of the premises. Statement of Facts Sometime in late May or early June, 1999, Moran and Alam decided to open an Italian restaurant at 495 Hempstead Turnpike, West Hempstead, a commercial space owned by Ciranni (hereinafter referred to as premises). Ciranni gave Moran the keys to the premise at Moran s request, so that work could be immediately commenced. Alam and 2
3 M o r an began to c lean the p r e m ises, l ease equ ip m en t and o the r w ise p so tha t it cou ld func ti on as a r es tau r an t. A ft e r d iscuss ion be tween the p June 22, 1999, a p r oposed lease was d r a ft ed by the a tt o r neys fo r M r. the end o f Ju ly 1999, when he issued an u lti Am laa mt tuha m t to a lease M o r beand execu ted no la te r t han Augus t 12, O n Augus t 11, 1999, t he pa rti es m e t a t t he o ffi ces o f Todd M an a tt o r ney. The pa rti es, M ann is t e r and M o r an s counse l, Laga r e nego ti a t ed a lease W ha. t tr ansp ir ed a ft e r a ll pa rti es execu ted the lease Howeve r, su ffi ce it t o say, M o r an fa il ed to tende r t he fir s t m on th s r m oney. No r d id M o r an p r ov ide ev idence o f i nsu r ance, as r equ ir ed b lease. The o ri g ina l docu m en t pu r po rt ed t o be t he lease was r e M ann is te r. Du ri ng the pe ri od o f June 1999 th r ough Augus t 11, 1999 P la subs tan ti a l su m s in the im p r ove m en t/r enova ti on o f t he p r e m ises. If accep t a ll o f P la in tiff s p r oo f, t he su m expended du ri ng $40 th is,000 pe.00 ri od. was a C ir ann i was awa r e tha t subs tan ti a l wo r k was be ing done because he s p r e m ises a lm os t da il y to check on pdu ri ng r og h ris ess fr equen. t i nspec ti ons, C ir r epea ted ly r eques ted tha t t he pa rti es s ign a lease. C ir ann i s r eques ts O n o r abou t Augus t 23, 1999, M ann is te r sen t Laga r enne a le tt e r i was ho ld ing the lease pend ing r ece ip t o f good funds fo r key m oney M ann is te r que ri ed if i n fac t t he dea l was s till a li ve. O n o r abou t Se M ann is te r f o r wa r ded two leases to Laga r enne, t o be he ld in esc r ow pend in funds fo r fir s t m on th s r en$15 t, secu, ce rit y rtifi, ed funds fo r key m oney and a p r o m isso r y no te. The le tt e r spec ifi ca ll y s ta ted, t ha t if t he r e we r e no t f u 3
4 its terms the escrowed lease was null and void. On or about September 10, 1999, Mannister received three personal checks for rent and security and the promissory note. Mannister advised in writing that this method of payment was unacceptable to his client and returned the checks by letter dated September 14, The letter demanded certified funds for all monetary obligations, together with proof of insurance. The letter further stated that, until the above requirements were met, there was no lease. During this post-august 1 lth period, Moran and Alam continued to improve the property and purchase supplies for the restaurant. If the Court were to accept all of Moran s proof, the sum for August through September improvements/repairs/purchases/ leases totaled in excess of $11,OOO.OO. On or about September 24,1999, Lagarenne sent Mannister the certified funds and proof of insurance. It is noted, that the September 24 h letter was sent after a letter from Mannister, in which he advised Lagarenne, that he felt the deal was over and Ciranni would be going to Court for a temporary restraining order. After receiving the certified check, Mannister learned that the insurance policy was not in effect because Moran s check bounced. On or about September 27, 1999, after heated words between Ciranni and his wife and Moran and his wife, the Morans removed items from the premises and gave back the keys to Ciranni. Decision of the Court The central distinguishing characteristic of a lease is the surrender of absolute possession and control of property to another party for an agreed upon rental. (See, Feder v. Caliguira, 8 N.Y.2d 400, (1960); Slutzky v. Cuomo, 114 A.D.2d, 116,498 N.Y.S.2d 550 (3d Dept. 1986). In order for an agreement, oral or written, to be enforceable as a lease all the essential terms must be agreed upon (see Mur-Mill Caterers v. Werner, 166 A.D.2d 4
5 55, 560 N.Y.S. 849 (2d Dept. 1990). These essential terms include the area to be leased, the duration of the lease, and the price to be paid. (See, Bernstein v Assoc., 185 A.D.2d 160,586 N.Y.S.2d 115 (1 st Dept. 1992). If any of these essential terms are missing and are not otherwise discernable by objective means, a lease has not been created. (See, Miller v. City of New York, 15 N.Y.2d 34 (1964); Ross v. Mail Ordering Merchandising, 128 A.D.2d 514, 512 N.Y.S.2d 446 (2d Dept. 1987). Here, there was never any evidence that the essential terms were agreed upon. In May/June 1999, Moran and Ciranni had a hand shake. Ciranni gave over the keys and Moran undertook substantial work on a specific area. The other essential elements required by law, however, are absolutely missing. There was no proof that an oral agreement or memorandum of agreement had been achieved with regard to the other essential details of the duration or amount of rent. It appears to this Court that these essential elements, together with other integral elements of a lease, were finally negotiated on August 11, Even after the August 11, 1999 meeting the parties failed to create a valid lease for numerous reasons. First, Moran failed to comply with the essential terms of the written document, held in escrow. Moran did not pay the rent and key money in proper form, nor did he provide insurance. The lease itself, though signed by the parties, was held in escrow. Thus, it was never delivered. The law is clear that unless there has been execution and delivery of the lease, there is no valid written agreement. Beck v. New York News, Inc. 92 A.D;2d 823, 460 N.Y.S.2d 326, (1 st Dept. 1983). Even if Plaintiff established the essential elements of an oral agreement, this Court could not have found in his favor. Under General Obligations Law Section 5-703, a lease for a term exceeding one year cannot be created without an agreement in writing. 5
6 Notwithstanding, General Obligation Law Section 5-703(4) mitigates the severity of the statute if acts have been preformed in reliance on and unequivocally referable to the contract. Acts such as taking possession and making improvements, when combined with the payment of rent, have been held to constitute part performance. Club Chain of Manhattan, Ltd. v. Christopher & Seventh Gourmet, Ltd. 74 A.D.2d 277,427 N.Y.S.2d 627 (lst Dept. 1980). Tuttle, Pendelton & Gelson, Inv. v. Dronart Realty Corp., 90 A.D.2d 830, 455 N.Y.S.2d 830 (2d Dept. 1982). In the instant case, Moran clearly took possession made significant, costly Improvement to Ciranni s property. However, he never gave Ciranni rent prior to August 11, Thereafter when he attempted to give payment, he did not comply with Ciranni s legitimate demands (key money, certified funds, valid insurance). Accordingly, this Court finds that there was no lease either before or after August 11, Accordingly, Plaintiff s causes of action numbered first, second and fourth are dismissed. With regard to causes of action third and fifth, the Court finds there has been no unlawful enrichment or detrimental reliance. Unfortunately, Moran has only his bad judgment to blame for his financial losses. Ciranni requested a formal lease numerous times. He was compelled to give Moran an ultimatum because of Moran s nonfeasance regarding the lease. If the tables had been turned, and Moran implored Ciranni for the lease, the result may have been different. Accordingly, causes of action third and fifth are likewise dismissed. Defendants counter claim for damages is dismissed. Defendant cannot seek to protect himself and his property under the terms of a lease he asserted was non-existent. 6
7 He allowed ongoing access and modification of financial recompense. to his premises, without demanding an ounce This constitutes the Decision and Order of the Court. APR
MEMORANDUM AFTER TRIA
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