• Defendant Granted Leave to Amend to add Counterclaims and Defenses Arising from the Same Facts Underlying Plaintiff’s Case: Mauray Realty Co. v Advantage Plastics, Inc.
  • August 13, 2012 | Author: Adam M. Rafsky
  • Law Firm: Farrell Fritz, P.C. - Uniondale Office
  • In a July 16, 2012 decision by Justice Kapnick, the court granted in part and denied in part the defendant’s motion for leave to amend its verified answer and counterclaims. The case involved a fifteen year lease of a commercial space in a mixed use building entered into by the plaintiff- landlord (“Mauray”) and defendant- tenant (“Advantage”). After Advantage filed a building permit and started construction on the property without first obtaining Mauray’s approval, Mauray commenced the action alleging Advantage had violated various provisions of the lease. Prior to commencing the action, however, Mauray did not serve Advantage with any written notice that it was in breach of the lease, as required under the lease, nor did it serve Advantage with papers commencing a summary proceeding.

    After submitting a first and second answer with counterclaims, Advantage sought leave to amend to add as affirmative defenses that: Mauray failed to serve the required predicate notices for breach and eviction; and that Mauray breached Advantage’s rights to quiet enjoyment because the property was in disrepair and because Mauray illegally evicted it from the premises. Advantage also sought to add counterclaims for: 1) a declaration that the lease was terminated due to Mauray’s breach and/or illegal eviction and an order directing the immediate return of the security deposit and other sums paid; and (2) an award of treble damages and attorneys’ fees based on Mauray’s failure to return the security deposit. Mauray argued that proposed amendments lacked merit and would be unfairly prejudicial because the Note of Issue had already been filed.

    The court granted Advantage’s motion with respect to each of the affirmative defenses and first counterclaim, holding that they arose out of the same facts as those underlying Mauray’s case and were not plainly lacking in merit as it was undisputed that Mauray did not serve Advantage with written notice of breach or its intent to terminate the lease, and that prior to commencement the premises became uninhabitable. The court, however, denied Advantage’s motion as to its counterclaim for conversion based on the non-return of its security deposit. The court held that any right Advantage had to the security deposit was covered by the lease and was therefore duplicative of Advantage’s claim for breach of the lease.

    Mauray Realty Co. v Advantage Plastics, Inc., Sup Ct, New York County, July 16, 2012, Kapnick, B., Index No. 406619/07