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Base Village Owner LLC v. Hypo Real Estate Capital Corporation

New York Supreme and/or Appellate Courts Appellate Division, First Department


February 16, 2012

BASE VILLAGE OWNER LLC,
PLAINTIFF-APPELLANT-RESPONDENT,
v.
HYPO REAL ESTATE CAPITAL CORPORATION, ET AL.,
DEFENDANTS-RESPONDENTS-APPELLANTS.

Base Vil. Owner LLC v Hypo Real Estate Capital Corp.

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 Official Reports.

Decided on February 16, 2012

Friedman, J.P., Sweeny, Renwick, DeGrasse, Roman, JJ.

Orders, Supreme Court, New York County (Charles E. Ramos, J.), entered February 9, 2011, which granted defendants' motion to dismiss the cause of action seeking damages for breach of contract and denied the motion with respect to the causes of action for injunctive and declaratory relief, unanimously modified, on the law, to the extent of dismissing the causes of action for declaratory judgment and injunctive relief, and otherwise affirmed, without costs. The Clerk is directed to enter judgment dismissing the complaint.

The limitation of remedies provision in the parties' loan agreement was properly construed as clearly, explicitly and unambiguously barring plaintiff's claim for damages based on allegations that defendants' agent unreasonably withheld or delayed approval of the documentation upon which defendants' obligation to extend the loan was conditioned (see e.g. L.K. Sta. Group, LLC v Quantek Media, LLC, 62 AD3d 487, 493 [2009]). In light of defendants' alleged economic self-interest, the provision was not rendered ineffective by allegations of misconduct that "smack" of intentional wrongdoing or willful, malicious or bad faith conduct (see Metropolitan Life Ins. Co. v Noble Lowndes Intl., 84 NY2d 430, 438-439 [1994]; see also e.g. Diplomat Props., L.P. v Komar Five Assoc., LLC, 72 AD3d 596, 597-598 [2010], lv denied 15 NY3d 706 [2010]).

However, the claim for declaratory judgment relief based on defendants' alleged defaults should have been dismissed based upon the provision stating that plaintiff's obligation to make payment on its loan debt was independent of defendants' performance of their obligations (see Rosenthal Paper Co. v National Folding Box & Paper Co., 226 NY 313, 319-320 [1919]). Because we need not reach the merits of the declaratory judgment claim (i.e., whether the defendants were in default), dismissal of the claim, rather than a declaration in favor of defendants, is appropriate (see Maurizzio v Lumbermens Mut. Cas. Co., 73 NY2d 951, 954 [1989]; Matter of Powell v Town of Coeymans, 238 AD2d 788, 789 [1997]). As to the claim for injunctive relief as the parties stated at oral argument, it is moot since foreclosure has taken place.

We have considered the parties' other contentions and find them unavailing.

THIS CONSTITUTES THE DECISION AND ORDER OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: FEBRUARY 16, 2012

CLERK

20120216

© 1992-2012 VersusLaw Inc.



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