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Vanderbilt Brookland, LLC v. Vanderbilt Myrtle, Inc.

Supreme Court of New York, Second Department

February 22, 2017

Vanderbilt Brookland, LLC, respondent,
v.
Vanderbilt Myrtle, Inc., et al., appellants. Index No. 500522/14

          Regina Felton, Brooklyn, NY, for appellant Vanderbilt Myrtle, Inc.

          Barclay Damon LLP, Syracuse, NY (Jon P. Devendorf of counsel), for appellant Cumberland Farms, Inc.

          Reiss Sheppe LLP, New York, NY (Matthew Sheppe of counsel), for appellant All Year Management, LLC.

          Robinson Brog Leinwand Greene Genovese & Gluck, P.C., New York, NY (Sheldon Eisenberger and Allen M. Eisenberg of counsel), for respondent.

          MARK C. DILLON, J.P. L. PRISCILLA HALL SYLVIA O. HINDS-RADIX VALERIE BRATHWAITE NELSON, JJ.

          DECISION & ORDER

         In an action, inter alia, for declaratory and injunctive relief, the defendants separately appeal, as limited by their briefs, from so much of an order of the Supreme Court, Kings County (Knipel, J.), dated April 10, 2015, as (a) granted that branch of the plaintiff's motion which was for leave to reargue those branches of its prior motion which were for a preliminary injunction, inter alia, enjoining and restraining the defendants Cumberland Farms, Inc., and All Year Management, LLC, from (i) transferring or purporting to transfer certain property to any person or entity other than the plaintiff, and (ii) pursuing or taking any action in furtherance of any rights claimed by the defendant All Year Management, LLC, with respect to that property, which had been denied in an order of the same court dated October 6, 2014, and, upon reargument, in effect, vacated the order dated October 6, 2014, and thereupon granted those branches of the prior motion, and (b) denied the motion of the defendants Cumberland Farms, Inc., and All Year Management, LLC, to cancel a notice of pendency filed by the plaintiff.

         ORDERED that the order dated April 10, 2015, is affirmed insofar as appealed from, with one bill of costs.

         The defendant Vanderbilt Myrtle, Inc. (hereinafter Myrtle), was the tenant of certain property (hereinafter the property) under a lease agreement with Gulf Oil Limited Partnership, on behalf of Cumberland Farms, Inc. (hereinafter Cumberland). Cumberland sought to sell the property, and Myrtle had a right of first refusal to purchase the property. In an agreement dated December 4, 2013 (hereinafter the purchase and sale agreement), Cumberland agreed to sell, and Myrtle agreed to purchase, the property for the sum of $10, 000, 000. The purchase and sale agreement required Myrtle to make a deposit in the sum of $1, 000, 000, and provided that the closing would occur no later than July 30, 2014.

         Prior to execution of the purchase and sale agreement, the plaintiff, Vanderbilt Brookland, LLC (hereinafter Brookland), and Myrtle entered into an agreement (hereinafter the stock sale agreement) whereby Brookland agreed to purchase, and Myrtle agreed to sell, five percent of the issued and outstanding shares of Myrtle's common stock for the sum of $500, 000. In the stock sale agreement, Brookland and Myrtle also agreed that Brookland would acquire Myrtle's right to purchase the property, and Brookland agreed to be bound by the terms and conditions set forth in the purchase and sale agreement, including the requirement to tender the deposit in the sum of $1, 000, 000.

         In January 2014, Brookland commenced this action for declaratory and injunctive relief against Myrtle, alleging, inter alia, that Myrtle had repudiated the stock sale agreement. It alleged that it had made the $1, 000, 000 deposit required by the purchase and sale agreement, but that Myrtle had then attempted to cancel the stock sale agreement. It moved, among other things, for a preliminary injunction prohibiting Myrtle from transferring any of its rights under the purchase and sale agreement to any entity other than Brookland, or transferring the property, or any interest in the property, to any entity other than Brookland. In an order dated April 4, 2014, the Supreme Court, upon, inter alia, determining that Brookland had tendered the $1, 000, 000 deposit, granted those branches of the motion. In a separate order, also dated April 4, 2014, the court directed Myrtle to respond to certain discovery demands. Myrtle has appealed from both of those orders (see Vanderbilt Brookland, LLC v Vanderbilt Myrtle, Inc., _____ A.D.3d _____ [Appellate Division Docket No. 2014-03427; decided herewith]).

         Thereafter, Brookland learned that on December 23, 2013, Myrtle had assigned its rights under the purchase and sale agreement to All Year Management, LLC (hereinafter All Year). Brookland then amended its complaint to add Cumberland and All Year as defendants in the action, and moved for a preliminary injunction, inter alia, enjoining and restraining Cumberland and All Year from transferring or purporting to transfer the property to any person or entity other than Brookland, and pursuing or taking any action in furtherance of any rights claimed by All Year with respect to the property. The Supreme Court denied the motion in an order dated October 6, 2014. Brookland then moved, inter alia, for leave to reargue its motion, and Cumberland and All Year moved to cancel a notice of pendency filed by Brookland. In the order on appeal, the court granted that branch of Brookland's motion which was for leave to reargue and, upon reargument, in effect, vacated its order dated October 6, 2014, and granted those branches of Brookland's prior motion which were for a preliminary injunction again Cumberland and All Year. The court also denied the motion of Cumberland and All Year to cancel the notice of pendency filed by Brookland. Myrtle, Cumberland, and All Year appeal.

         A motion for leave to reargue "shall be based upon matters of fact or law allegedly overlooked or misapprehended by the court in determining the prior motion, but shall not include any matters of fact not offered on the prior motion" (CPLR 2221[d][2]). " Motions for reargument are addressed to the sound discretion of the court which decided the prior motion and may be granted upon a showing that the court overlooked or misapprehended the facts or law or for some [other] reason mistakenly arrived at its earlier decision'" (E.W. Howell Co., Inc. v S.A.F. La Sala Corp., 36 A.D.3d 653, 654, quoting Carrillo v PM Realty Group, 16 A.D.3d 611, 611; see Matter of New York Cent. Mut. Ins. Co. v Davalos, 39 A.D.3d 654, 655).

         Contrary to the defendants' contentions, the Supreme Court providently exercised its discretion in granting that branch of Brookland's motion which was for leave to reargue, upon its determination that, in deciding the prior motion, it had overlooked a provision of the purchase and sale agreement which prohibited the recording of that agreement or any memorandum thereof (see E.W. Howell Co., Inc. v S.A.F. La Sala Corp., 36 A.D.3d 653; Mangieri v Juskowitz, 112 A.D.2d 147).

         Moreover, upon reargument, the Supreme Court providently granted those branches of Brookland's prior motion which were for a preliminary injunction, inter alia, enjoining and restraining Cumberland and All Year from transferring the property to any entity other than Brookland or taking any ...


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