J & M Indus., Inc. v. Red Apple 180 Myrtle Ave. Dev., LLC

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Docket Number

No. 2018-10472

Attorney(S)

Westermann Sheehy Keenan Samaan & Aydelott, LLP, East Meadow, N.Y. (Michael J. Rosenthal of counsel), for appellants. Kilhenny & Felix, Scarsdale, N.Y. (James M. Felix of counsel), for respondent.

Judges

Robert J. Miller
Cheryl E. Chambers

Acts

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Smart Summary

Factual and Procedural Background

The plaintiff, J & M Industries, Inc., commenced an action to recover damages for breach of contract and to foreclose a mechanic's lien against the defendants, Red Apple 180 Myrtle Avenue Development, LLC, and Hartford Fire Insurance. The defendants appeared and interposed a counterclaim seeking to recover an alleged overpayment. The defendants moved for summary judgment to dismiss the first and fourth causes of action against them and to discharge the mechanic's lien, as well as for summary judgment on their counterclaim. The Supreme Court, Kings County, denied these motions. The defendants appealed that denial.

Legal Issues Presented

Whether the defendants were entitled to summary judgment dismissing the plaintiff’s first cause of action for breach of contract and fourth cause of action to foreclose the mechanic's lien.
Whether the defendants were entitled to summary judgment discharging the mechanic's lien.
Whether the defendants were entitled to summary judgment on their first counterclaim to recover an alleged overpayment.

Arguments of the Parties

Defendants' Arguments

The defendants argued that their evidentiary submissions demonstrated the plaintiff had executed releases related to payments received that exceeded the amount claimed in the itemized lien statement.
They contended that these releases and payments satisfied all amounts due under the contract, justifying dismissal of the plaintiff’s claims and discharge of the mechanic's lien.
The defendants further sought summary judgment on their counterclaim for recovery of an alleged overpayment.

Plaintiff's Arguments

The plaintiff contended that the defendants failed to establish as a matter of law that all amounts due under the contract were paid in full.
The plaintiff argued that the releases executed did not bar the claims in this action.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Nunez v. Chase Manhattan Bank, 155 A.D.3d 641, 63 N.Y.S.3d 481	Defendant's prima facie burden on summary judgment for counterclaim requires establishing all essential elements.	Used to explain the burden on defendants moving for summary judgment on their counterclaim.
Shah v. Mitra, 171 A.D.3d 971, 98 N.Y.S.3d 197	Supports the standard for summary judgment on counterclaims.	Reinforces the requirement for defendants to establish prima facie entitlement to judgment on counterclaims.
Stukas v. Streiter, 83 A.D.3d 18, 918 N.Y.S.2d 176	General principles governing summary judgment burdens.	Contextual background on summary judgment standards.
Sterling Park Devs., LLC v. China Perfect Constr. Corp., 185 A.D.3d 1082, 126 N.Y.S.3d 397	Defendant may meet burden by negating a single essential element of plaintiff's claim.	Clarifies burden for summary judgment dismissing plaintiff's causes of action.
Poon v. Nisanov, 162 A.D.3d 804, 79 N.Y.S.3d 227	Supports the principle that negating one essential element suffices for summary judgment.	Supports the defendants’ burden in seeking dismissal of plaintiff’s claims.
Quantum Corporate Funding, Ltd. v. Ellis, 126 A.D.3d 866, 6 N.Y.S.3d 255	Defendant must affirmatively demonstrate merits of defense or counterclaim, not merely point out gaps in plaintiff’s proof.	Used to explain why defendants’ motion failed without affirmative demonstration of defense merits.
Nill v. Schneider, 173 A.D.3d 753, 102 N.Y.S.3d 96	Reinforces requirement for affirmative showing on summary judgment.	Supports court’s denial of defendants’ motion for failure to meet burden.
Alvarez v. Prospect Hosp., 68 N.Y.2d 320, 508 N.Y.S.2d 923, 501 N.E.2d 572	Failure to make prima facie showing requires denial of summary judgment regardless of opposing papers.	Justifies denial of defendants’ motion despite plaintiff’s opposition.
Winegrad v. New York Univ. Med. Ctr., 64 N.Y.2d 851, 487 N.Y.S.2d 316, 476 N.E.2d 642	Same as Alvarez; emphasizes burden of proof on summary judgment movant.	Supports court’s denial of defendants’ motion for failure to establish prima facie entitlement.

Court's Reasoning and Analysis

The court analyzed the defendants’ evidentiary submissions and found that they failed to address numerous items listed in the plaintiff’s itemized lien statement as required by Lien Law § 38. The defendants did not demonstrate that all amounts allegedly due under the contract had been paid in full. Furthermore, the court held that the releases executed by the plaintiff did not bar the claims, referencing Lien Law § 34, which prohibits waiver of the right to enforce a mechanic's lien except under specific conditions not met here. Because the defendants failed to establish their prima facie entitlement to summary judgment dismissing the plaintiff’s claims and discharging the mechanic's lien, and failed to establish entitlement to summary judgment on their counterclaim, the court properly denied their motion regardless of the sufficiency of the plaintiff’s opposition.

Holding and Implications

The court affirmed the order denying the defendants’ motion for summary judgment dismissing the first and fourth causes of action, discharging the mechanic's lien, and granting summary judgment on the defendants’ first counterclaim.

This decision means the plaintiff’s breach of contract and mechanic's lien claims remain pending, and the defendants’ counterclaim for overpayment was not granted at this stage. The court’s ruling did not set new precedent but applied existing summary judgment standards and lien law principles to the facts presented.

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J & M INDUSTRIES, INC., etc., respondent, v. RED APPLE 180 MYRTLE AVENUE DEVELOPMENT, LLC, et al., appellants, et al., defendants.

Westermann Sheehy Keenan Samaan & Aydelott, LLP, East Meadow, N.Y. (Michael J. Rosenthal of counsel), for appellants.

Kilhenny & Felix, Scarsdale, N.Y. (James M. Felix of counsel), for respondent.

CHERYL E. CHAMBERS, J.P., ROBERT J. MILLER, BETSY BARROS, ANGELA G. IANNACCI, JJ.

DECISION & ORDER In an action, inter alia, to recover damages for breach of contract and to foreclose a mechanic's lien, the defendants Red Apple 180 Myrtle Avenue Development, LLC, and Hartford Fire Insurance appeal from an order of the Supreme Court, Kings County (Lawrence Knipel, J.), dated May 17, 2018. The order, insofar as appealed from, denied those branches of those defendants’ motion which were for summary judgment dismissing the first and fourth causes of action insofar as asserted against them and discharging the mechanic's lien, and for summary judgment on their first counterclaim, to recover an overpayment.

ORDERED that the order is affirmed insofar as appealed from, with costs.

The plaintiff commenced this action, among other things, to recover damages for breach of contract (first cause of action) and to foreclose a mechanic's lien (fourth cause of action). The defendants Red Apple 180 Myrtle Avenue Development, LLC, and Hartford Fire Insurance (hereinafter together the defendants) appeared in the action and in their answer, inter alia, interposed a counterclaim to recover an alleged overpayment (first counterclaim). The defendants moved for summary judgment dismissing the complaint insofar as asserted against them and discharging the mechanic's lien, and for summary judgment on their first counterclaim. The defendants contended, among other things, that their evidentiary submissions demonstrated that the plaintiff had executed a series of releases in connection with payments it had received, totaling an amount that exceeded the total amount the plaintiff sought in its itemized lien statement.

The plaintiff opposed the defendants’ motion. The plaintiff contended that the defendants’ submissions failed to establish as a matter of law that all of the amounts due under the subject contract were paid in full. The plaintiff further contended that the releases did not bar this action.

In an order dated May 17, 2018, the Supreme Court denied the defendants’ motion. The court determined, inter alia, that the defendants failed to demonstrate that all of the amounts allegedly due under the subject contract had been paid in full. The defendants appeal. On appeal, the defendants contend that the Supreme Court should have granted those branches of their motion which were for summary judgment dismissing the first and fourth causes of action and discharging the mechanic's lien, and for summary judgment on their first counterclaim to recover an alleged overpayment.

A mechanic's lien (see Lien Law, article 2), may be enforced in accordance with the provisions of article 3 of the Lien Law (see Lien Law § 24 ). "A lienor who has filed a notice of lien shall, on demand in writing, deliver to the owner or contractor making such demand a statement in writing which shall set forth the items of labor and/or material and the value thereof which make up the amount for which [the lienor] claims a lien, and which shall also set forth the terms of the contract under which such items were furnished" ( Lien Law § 38 ).

"Notwithstanding the provisions of any other law, any contract, agreement or understanding whereby the right to file or enforce any lien created under article two [of the Lien Law] is waived, shall be void as against public policy and wholly unenforceable" ( Lien Law § 34 ). However "[t]his section shall not preclude a requirement for a written waiver of the right to file a mechanic's lien executed and delivered by a contractor, subcontractor, material supplier or laborer simultaneously with or after payment for the labor performed or the materials furnished" (id. ).

A defendant moving for summary judgment on a counterclaim generally has the burden of establishing, prima facie, "all of the essential elements of the [counterclaim]" ( Nunez v. Chase Manhattan Bank, 155 A.D.3d 641, 643, 63 N.Y.S.3d 481 ; see Shah v. Mitra, 171 A.D.3d 971, 979, 98 N.Y.S.3d 197 ; see generally Stukas v. Streiter, 83 A.D.3d 18, 23, 918 N.Y.S.2d 176 ). "By contrast, a defendant moving for summary judgment dismissing one of the plaintiff's causes of action may generally sustain his or her prima facie burden ‘by negating a single essential element’ of that cause of action" ( Sterling Park Devs., LLC v. China Perfect Constr. Corp., 185 A.D.3d 1082, 1084, 126 N.Y.S.3d 397, quoting Nunez v. Chase Manhattan Bank, 155 A.D.3d at 643, 63 N.Y.S.3d 481 ; see Poon v. Nisanov, 162 A.D.3d 804, 806, 79 N.Y.S.3d 227 ).

"It is a defendant's burden, when it is the party moving for summary judgment, to demonstrate affirmatively the merits of a defense [or counterclaim], which cannot be sustained by pointing out gaps in the plaintiff's proof" ( Quantum Corporate Funding, Ltd. v. Ellis, 126 A.D.3d 866, 871, 6 N.Y.S.3d 255 ; see Nill v. Schneider, 173 A.D.3d 753, 755, 102 N.Y.S.3d 96 ). "Failure to make such prima facie showing requires a denial of the motion, regardless of the sufficiency of the opposing papers" ( Alvarez v. Prospect Hosp., 68 N.Y.2d 320, 324, 508 N.Y.S.2d 923, 501 N.E.2d 572 ; see Winegrad v. New York Univ. Med. Ctr., 64 N.Y.2d 851, 853, 487 N.Y.S.2d 316, 476 N.E.2d 642 ).

Here, as the Supreme Court correctly concluded, the defendants’ evidentiary submissions failed to account for, or otherwise address, numerous items listed in the plaintiff's itemized lien statement (see Lien Law § 38 ), and the defendants otherwise failed to demonstrate that all of the amounts allegedly due under the subject contract had been paid in full. Furthermore, the defendants failed to demonstrate that the releases executed by the plaintiff barred the relief sought in this action (see generally Lien Law § 34 ). Since the defendants failed to establish their prima facie entitlement to judgment as a matter of law dismissing the first and fourth causes of action and discharging the mechanic's lien, and for summary judgment on their first counterclaim, the court properly denied those branches of their motion without regard to the sufficiency of the plaintiff's opposition papers (see Winegrad v. New York Univ. Med. Ctr., 64 N.Y.2d at 853, 487 N.Y.S.2d 316, 476 N.E.2d 642 ).

CHAMBERS, J.P., MILLER, BARROS and IANNACCI, JJ., concur.