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Mazur Brothers Realty, LLC v. State

December 15, 2008

MAZUR BROTHERS REALTY, LLC, CLAIMANT,
v.
THE STATE OF NEW YORK, NEW YORK STATE ATTORNEY GENERAL, NEW YORK STATE COMPTROLLER, COUNTY OF WESTCHESTER, CITY OF WHITE PLAINS, BANK OF NEW YORK (NOW KNOWN AS JPMORGAN CHASE), MAZUR BROTHERS, INC., MICHAEL RIKON, ESQ. AND THE CITY OF WHITE PLAINS SCHOOL DISTRICT, DEFENDANTS.
MAZUR BROTHERS REALTY, LLC, CLAIMANT,
v.
THE STATE OF NEW YORK, NEW YORK STATE ATTORNEY GENERAL, NEW YORK STATE COMPTROLLER, COUNTY OF WESTCHESTER, CITY OF WHITE PLAINS, BANK OF NEW YORK (NOW KNOWN AS JPMORGAN CHASE), MAZUR BROTHERS, INC., MICHAEL RIKON, ESQ. AND THE CITY OF WHITE PLAINS SCHOOL DISTRICT, DEFENDANTS.



The opinion of the court was delivered by: Terry J. Ruderman, J.

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This opinion is uncorrected and subject to revision before publication in the printed Official Reports.

Petitioner seeks an order (SP-120) for the distribution of an award, together with interest at a rate of 9%, for the appropriation of 80 Lake Street, White Plains, New York (hereinafter "80 Lake Street"). Petitioner seeks a second order (SP-121) for the distribution of the advance payment, together with interest at a rate of 9%, for the appropriation of 90 Lake Street, White Plains, New York (hereinafter "90 Lake Street").

80 Lake Street

Petitioner is the owner in fee of 80 Lake Street. On April 4, 2006, defendant State of New York (hereinafter "defendant") filed Map Nos. 650, 656 and 657, Parcels 963, 969 and 970 to appropriate property located at 80 Lake Street. Defendant offered $1,369,500.00 as the value of the property appropriated. Petitioner agreed to this value and executed an Agreement of Adjustment (petitioner's exhibits B in support of SP-120 and A of the verified reply).*fn1 The Agreement of Adjustment states that the compensation paid to petitioner represents "the total value of the property so appropriated and for all legal damages caused by such appropriation, including all damages *** to the remainder of the affected property" (petitioner's exhibit B).

90 Lake Street

Petitioner is the owner in fee of 90 Lake Street. On April 4, 2006, defendant filed Map Nos. 638 R-1, 639 R-1, Parcels 951 and 952 to appropriate property located at 90 Lake Street. Petitioner executed an Advance Payment agreement for 90 Lake Street in the sum of $1,011,500.00 (exhibit F in support of SP-121).*fn2 Defendant offered this money to petitioner to satisfy "the total value of the property so appropriated and for all legal damages caused by such appropriation, including all damages *** to the remainder of the affected property" (petitioner's exhibit F).

Background

Prior to authorizing either payment, defendant identified several parties with a potential interest in the properties. Those parties identified the following parties: petitioner (fee interest in both properties); Mazur Brothers, Inc. (lessee of both properties); JP Morgan Chase*fn3 (mortgagee of both properties and hereinafter "Chase"); City of White Plains (taxing authority of both properties); County of Westchester (taxing authority of both properties); petitioner's attorney (attorney lien)*fn4; Thomas DiNapoli (Comptroller of the State of New York); and the Attorney General's office (a necessary party pursuant to EDPL §304(E) and Court of Claims Act §23). As the interest that each of these parties held was not easily ascertainable, defendant deposited the monies for each of the parcels into an interest bearing account with the Comptroller's office.

Mazur Brothers, Inc. is the commercial tenant at both properties. Mazur Brothers, Inc. has filed two claims (claim nos. 112661 and 112658) against defendant for damages to its trade fixtures as a result of the appropriation. The trade fixtures are located at 62 Lake Street but were used in conjunction with the business conducted at 80 Lake Street and 90 Lake Street. The fixtures have been rendered useless as a result of the taking (Mazur Brothers, Inc. v State of New York, J. Scuccimarra, Claim Nos. 112661 & 112658, M-72859).

As motions to the pending claims, petitioner and Mazur Brothers, Inc. brought a distribution proceeding before the Hon. Thomas H. Scuccimarra (M-72859). Judge Scuccimarra properly denied the motion as the distribution proceeding must be brought by a special proceeding (EDPL §304 and Court of Claims Act §23). Thereafter, petitioner and Mazur Brothers, Inc. brought a special proceeding before this Court (SP-115 and SP-116) seeking distribution of the money in the appropriation accounts for 80 Lake Street and 90 Lake Street. Due to several procedural errors, the proceedings were denied and petitioner has brought the instant actions seeking distribution. Prior to allowing this proceeding to begin, the Court directed petitioner to join an additional necessary party, to wit, the City of White Plains School District. The school district has been served and appears in these actions.

Analysis

Petitioner asks that the $1,369,500.00 on account for 80 Lake Street be distributed first to Chase in full satisfaction of the mortgage on 80 Lake Street and 90 Lake Street. Petitioner asks that the remainder of the account be distributed to petitioner. It is petitioner's position that Mazur Brothers, Inc. has no interest in these funds because they were offered as part of the fee taking and not part of the trade fixture claim. Petitioner also argues that none of the taxing authorities have a right to any distribution of the money. According to petitioner, all taxes were current at the time of the taking on the appropriated portion of the property.

As to the $1,011,500.00 held for 90 Lake Street, petitioner asks that the entirety of the account be distributed to petitioner. The mortgage held by Chase will be satisfied by the funds held for 80 Lake Street. Again, it is petitioner's position that Mazur Brothers, Inc. has no interest in these funds because they were offered as part of the fee taking and not part of the trade fixture claim. Petitioner also argues that none of the taxing authorities have a right to any distribution of the money. According to petitioner, all taxes were current at the time of the taking on the appropriated portion of the property.

EDPL §303 states in pertinent part, "[t]he condemnor shall establish an amount which it believes to represent just compensation for the real property to be acquired. The condemnor shall make a written offer to acquire the property for one hundred per centum of the valuation so established." It is the mandate of EDPL § 303, that condemnor establish and offer an amount which it believes to represent just compensation (Matter of Lateral Sewer 2005 of the Southwest Sewer District in the County of Suffolk v Martin Constr. Corp., 113 AD2d 799). It is incumbent ...


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