The following e-filed papers read herein: NYSCEF Doc Nos. MS 3 36-52; 90-92 MS 6 135-138; 144-148 Decision and Order Plaintiff’s motion seeking dismissal of defendants’ counterclaim and defendants’ motion seeking dismissal of the amended complaint pursuant to CPLR 3211 are decided as follows: Plaintiff’s Motion to Dismiss Counterclaims According to plaintiff’s complaint, after having successfully jointly developed a different property owned by defendant Myron Siegel (“Siegel”), the parties decided to enter into a similar arrangement for the development of property owned by defendant Alison Six Star LLC (“Alison Six” and with Siegel, “defendants”) located at 13-17 Lexington Avenue in Brooklyn, New York (hereinafter the “Premises”). On November 25, 2020, the parties entered into a Ground Lease Agreement (“Lease Agreement”) through which Alison Six leased the Premises to plaintiff for a period of 49 years. In conjunction with the Lease Agreement, the parties simultaneously entered into an Option Agreement through which Alison Six granted to plaintiff the right to become a 49.9 percent member of Alison Six. Under its terms, plaintiff retains the right to exercise that option through July 30, 2023. On or around January 19, 2022, plaintiff alleges that defendants sent plaintiff a “Joint Venture Agreement” and demanded that plaintiff restructure their transaction in accordance with said agreement. After rejecting defendants’ renegotiated terms, plaintiff alleges that, on February 25, 2022, Alison Six retaliated by issuing a Notice of Default asserting claims against plaintiff similar to those which now constitute defendants’ counterclaims. Specifically, defendants’ counterclaims allege that plaintiff breached the parties’ agreement by failing to remit monthly rent payments in violation of Article II and Exhibit A of the Lease Agreement, failing to remit the required “Additional Rent” (i.e, taxes, utilities and insurance) in violation of Article IV of the Lease Agreement, and failing to promptly initiate construction and provide the required plans, among other items, in violation of Article v. of the Lease Agreement. Plaintiff argues that all three of defendants’ counterclaims must be dismissed based on documentary evidence because the commencement date (“Commencement Date”) for the Lease Agreement has not initiated. Plaintiff represents that, at the time of the formation of the Lease Agreement and continuing through the commencement of this litigation, the Premises was occupied by residential tenants. In contemplation of the need to have the Premises vacant to commence development, plaintiff alleges that the parties added Section XXIX.18 to the end of the Lease Agreement which provides that: “Landlord agrees to and is responsible to vacate all tenants presently occupying or have [sic] a lease to the premises. It is understood that until such time as the property is fully vacated, no offering plan may be submitted to the Department of Law to convert said premises to Condominium ownership.” Based on the foregoing provision and defendants’ failure to remove all tenants from the Premises, plaintiff argues that the Commencement Date never began. Further, plaintiff contends that the parties’ agreement to set the Commencement Date sometime in the future is demonstrated by the fact that the Commencement Dates are all left blank in the Lease Agreement and the appended exhibits. Additionally, plaintiff contends that the implied acknowledgement that the Lease Agreement’s execution date (“Execution Date”) and the Commencement Date were separate and distinct events is evident in the following provisions of the Lease Agreement: 1) pursuant to Sections I.1(f)and II.1, the 49-year term would initiate once the Commencement Date was initiated; 2) pursuant to Section II.2, plaintiff accepted the condition of the premises, subject to ordinary wear and tear occasioned between the Execution Date and the future Commencement Date; 3) pursuant to Section II.3, once known and established, the parties would enter into a separate agreement confirming the exact Commencement Date in the form of Exhibit 3 to the Lease Agreement. No form had ever been completed or entered into; 4) pursuant to Section II.4, the Commencement Date was unknown at the time of the execution of the Lease Agreement and was therefore left blank; 5) pursuant to Section II.5, if the Premises were condemned between the Execution Date and the Commencement Date, the lease would be terminated; 6) pursuant to Section III.3, if the Commencement Date were other than the first day of the month, the rent for the first month would be apportioned according to the number of remaining days in that month; 7) pursuant to Section IV.3 and 4, future assessments or Impositions are adjusted based upon the Commencement Date; 8) pursuant to Section IV.9, in the event Alison Six contested the property taxes of the Premises prior to the Commencement Date, it would continue to prosecute those claims thereafter. Any reduction in taxes were to inure to plaintiff but plaintiff would be obligated to repay to Alison Six its equitable share of legal fees incurred by Alison Six in obtaining the tax reduction; 9) pursuant to Section IX.2, upon the Commencement Date, plaintiff would be obligated to obtain a “causes of Loss” insurance policy. As the Commencement Date has not occurred, no such policy has been obtained by 17 Lex nor was one ever requested by Alison Six; 10) pursuant to Section I.1(d) and Exhibit 2, Base Rent starts on the first day of the Commencement Date. No rent had ever been paid by 17 Lex or demanded by Alison Six until such time as defendants’ demand for renegotiated terms was rejected. Based on the foregoing, plaintiff argues that defendants’ counterclaims must be dismissed. Plaintiff also points out that Siegel cannot be a counterclaim plaintiff because Siegel is not a party to any of the parties’ agreements and thus lacks privity to assert any of the counterclaims. In opposition, defendants contend that the Commencement Date has already occurred and that such date is November 25, 2020, the date when the parties signed the subject agreements including the Commencement Date Agreement. According to defendants, the fact that the actual date is blank is irrelevant since section II.3 of the Lease Agreement provides that an executed Commencement Date Agreement is not required to establish the Commencement Date. Specifically, the provision states that “[t]he failure of either or both parties to execute such agreement shall not affect the occurrence of the Commencement Date, or the Expiration Date.” In addition, defendants contend that a vacant premises is not a condition precedent to initiate the Commencement Date because the Lease Agreement fails to explicitly state same. Moreover, because the Lease Agreement makes clear that any delay or failure to render a bill does not constitute a waiver of defendant’s right to demand and collect payment, defendants contend that their failure to previously request payment of rent, insurance and taxes is irrelevant. Finally, defendants assert that Siegel is a third-party beneficiary under the Lease Agreement and that, as such, he is a proper counterclaimant. In reply, plaintiff emphasizes that it is undisputed that the Lease Agreement contains a covenant that Alison Six had an obligation to make the Premises vacant. Yet, plaintiff points out that defendants endorse a reading of the Lease Agreement that provides for the demolition of a tenanted building. Plaintiff also argues that it highlighted defendants’ failure to demand rent, not to advocate that the rent payments were waived, but to suggest that defendants’ motives for issuing a default notice was solely to coerce plaintiff into renegotiating the parties’ agreements. Defendants’ Motion to Dismiss the Complaint Defendants move to dismiss plaintiff’s complaint on the grounds that the Lease Agreement is an unenforceable “agreement to agree” since the Commencement Date is left blank. According to defendants, the absence of the foregoing material term renders the agreement insufficient to satisfy the statute of frauds. In addition, defendants seek dismissal of the two causes of action asserted against Siegel — fraud and tortious interference — on the grounds that plaintiff agreed that Siegel would not be personally liable for any action in connection with the Lease Agreement. Specifically, that pursuant to Section XXII.2 of the Lease Agreement, plaintiff agreed that Landlord’s members and principals “shall have no personal liability under or in connection with this Lease….” and that plaintiff “shall only look to Landlord’s interest in the Premises and this Lease for the satisfaction of Tenant’s remedies or to collect any judgment requiring the payment of money by Landlord or such persons under or in connection with this Lease.” In opposition, plaintiff argues that the Lease Agreement is complete, no future terms were to be negotiated, and that the Commencement Date was subject to the condition that defendants cause the Premises to be vacant. Plaintiff claims that the fact that there are conditions precedent to the occurrence of events contained within the Lease Agreement is normal within real estate contracts and their existence does not offend the statute of frauds. In any event, plaintiff contends that the statute of frauds argument fails because both parties have partially performed under the contract insofar as plaintiff has provided millions of dollars in development costs, as well as time and expertise, and Alison Six has commenced the process to remove the Premises’ tenants. Finally, plaintiff emphasizes that the only logical reading of the Lease Agreement is that a removal of all tenants was required for the Commencement Date to initiate as no demolition would be permitted without the premises being vacated under a fully reconfigured demolition plan. In reply, defendants argue that one must be able to ascertain a commencement date without reference to any unexpressed intentions or contemplations of the parties, which is not possible in this case. As such, defendants stress that the subject Lease Agreement is an unenforceable agreement to agree. Discussion “A motion pursuant to CPLR 3211(a)(1) to dismiss causes of action based upon documentary evidence may be appropriately granted only where the documentary evidence utterly refutes plaintiff’s factual allegations, conclusively establishing a defense as a matter of law” (Board of Mgrs. of 285 Driggs Ave. Condominium v. 285 Driggs Ave., LLC, 173 AD3d 821, 822 [2d Dept 2019] [internal quotation marks and citations omitted]). “A condition precedent is an act or event, other than a lapse of time, which, unless the condition is excused, must occur before a duty to perform a promise in the agreement arises” (Ashkenazi v. Kent S. Assoc., LLC, 51 AD3d 611, 611 [2d Dept 2008] [internal quotation marks and citations omitted]). “As a general rule, it must clearly appear from the agreement itself that the parties intended a provision to operate as a condition precedent” (Kass v. Kass, 235 AD2d 150, 159 [2d Dept 1997]). “If the language is in any way ambiguous, the law does not favor a construction which creates a condition precedent” (id.). A contractual duty will not be construed as a condition precedent absent clear language showing that the parties intended to make it a condition (see Unigard Sec. Ins. Co. v. North Riv. Ins. Co., 79 NY2d 576, 581 [1992]). Here, plaintiff fails to establish that a vacant Premises is a condition precedent to initiate the Commencement Date. The Lease Agreement does not explicitly state that the Premises must be vacant for a Commencement Date to attach. Nor does the Lease Agreement state that demolition of the Premises must be possible for the Commencement Date to begin. While demolition may not be possible where tenants are residing at the Premises, this does not establish that the parties agreed that a vacant Premises was a condition precedent to commencement of the lease absent contractual language so indicating. To the extent that plaintiff argues that the parties had yet to agree upon a Commencement Date and thus, plaintiff is not in actual breach of any agreement, such an argument is inappropriate on a CPLR 3211 motion to dismiss. Based on the foregoing, plaintiff fails to establish entitlement to dismissal of defendants’ breach of contract counterclaims pursuant to CPLR 3211(a)(1). Notwithstanding the foregoing, Siegel is dismissed as a counterclaim plaintiff as Siegel is indisputably not a party to the Lease Agreement, nor is there any indication from the language of the Lease Agreement that it was intended for Siegel’s benefit (see Board of Mgrs. of 100 Congress Condominium v. SDS Congress, LLC, 152 AD3d 478, 480 [2d Dept 2017]). Thus, Siegel’s counterclaims are dismissed. Turning then to defendants’ motion to dismiss the complaint, which is premised on their argument that the subject 60-page Lease Agreement is merely an “agreement to agree,” the motion is denied in part. “A contract does not necessarily lack all effect merely because it expresses the idea that something is left to future agreement” (Four Seasons Hotels v. Vinnik, 127 AD2d 310, 317 [1st Dept 1987] [citations omitted]). As stated by the court in Metro-Goldwyn-Mayer, Inc. v. Scheider, 40 NY2d 1069, 1070-1071 [1976]: “[Where] the parties have completed their negotiations of what they regard as essential elements, and performance has begun on the good faith understanding that agreement on the unsettled matters will follow, the court will find and enforce a contract even though the parties have expressly left these other elements for future negotiation and agreement, if some objective method of determination is available, independent of either party’s mere wish or desire. Such objective criteria may be found in the agreement itself, commercial practice or other usage and custom. If the contract can be rendered certain and complete, by reference to something certain, the court will fill in the gaps” (citations omitted). The fact that the parties left the Commencement Date blank is insufficient to deem the subject 60-page Lease Agreement unenforceable (see Shmaltz Brewing Co., LLC v. Dog Cart Mgt. LLC, 202 AD3d 1349, 1351[3d Dept 2022] [finding that the lack of a specific date for the opening of the tasting room does not render the contract unenforceable]). This is especially so without the benefit of any discovery regarding the parties’ intent as to the Commencement Date at the time of the agreement. Thus, defendants are not entitled to dismissal of the complaint on this basis. However, defendants’ motion to dismiss the complaint as against Siegel based on the language of the Lease Agreement is granted. The Lease Agreement explicitly provides that “[landlord] shall have no personal liability under or in connection with this Lease” and that “[t]enant shall look only to Landlord’s interest in the Premises and this Lease for the satisfaction of Tenant’s remedies or to collect any judgment requiring the payment of money by Landlord or such persons under or in connection with this Lease.” Plaintiff fails to proffer any argument why this limitation on liability provision should not be enforced according to its terms and fails to even address this part of defendants’ motion. As such, that part of defendants’ motion seeking dismissal of the complaint against Siegel is granted. Conclusion Based on the foregoing, plaintiff’s motion to dismiss defendants’ counterclaims is granted only to the extent that Siegel’s counterclaims are dismissed. Defendants’ motion to dismiss the complaint is granted only to the extent that the complaint is dismissed against Siegel. The remainder of the parties’ motions is denied.
