The following papers numbered 1 to 2, Read on this ex parte motion filed on 6/17/23, and duly submitted as no. 4 on the Motion Calendar of 7/17/23. PAPERS NUMBERED Notice of Motion — Order to Show Cause — Exhibits and Affidavits Annexed 1 Answering Affidavit and Exhibits 2 Replying Affidavit and Exhibits Notice of Cross-Motion — Affidavits and Exhibits Pleadings — Exhibit Stipulation(s) — Referee’s Report — Minutes Filed Papers-Order of Reference and Amending Caption in Mortgage Foreclosure Memorandum of Law Administrative Order 5.25.2022 and Amended Bronx Auction Plan 2021 Defendants D-VYSE LLC and DANIEL A. KWAKYEH’s motion is decided in accordance with the Decision and Order annexed hereto. In this action for foreclosure on a mortgage and sale of the real property pledged as security, defendants D-VYSE LLC (DVYSE) and DANIEL A. KWAKYEH (Kwakyeh) move seeking, inter alia, an order pursuant to CPLR §6301 granting a preliminary injunction, enjoining plaintiff from appropriating and collecting the rents paid by tenants at the premises encumbered by the instant mortgaged. Saliently, the foregoing defendants contend that this Court’s denial of plaintiff’s prior application for the appointment of a receiver now bars plaintiff from collecting and appropriating the foregoing rents. Plaintiff opposes the instant motion, asserting that the agreement between the parties grants plaintiff the right to collect and appropriate the foregoing rents and that the denial of its prior application for the appointment of a receiver does not serve to impair such right. For the reasons that follow hereinafter, D-VYSE and KWAKYEH’s motion is denied. The instant action is for foreclosure on a mortgage and the sale of the real property pledged as security. The complaint alleges that on October 31, 2018, D-VYSE executed and delivered a note to nonparty Habib American Bank (Habib). Per the note, D-VYSE agreed to repay a loan totaling $1 million. On that same date, DVYSE also executed a mortgage which pledged the premises located at 2070 Vyse Avenue, Bronx, NY (2070) as security for the note. Pursuant to the foregoing agreements, D-VYSE was obligated to make payments on all sums borrowed and the failure to make a payment when due would constitute a default, which per the agreements, would authorize plaintiff to foreclose on the mortgage and sell 2070. On the foregoing date, KWAKYEH also executed a guaranty agreement, wherein he agreed to personally guarantee the loan to DVYSE. On May 12, 2022, D-VYSE failed to make a payment that was then due and therefore, defaulted. On July 21, 2022, Habib assigned the note and mortgage to plaintiff, which now owns and holds them. Based on the foregoing, plaintiff seeks a judgment authorizing foreclosure and 2070′s sale. On January 10, 2022, this Court denied plaintiff’s application seeking to appoint a receiver to assume the management of 2070. Significantly, this Court held that “plaintiff fail[ed] to sufficiently establish that absent a receiver 2070 is in danger of being irreparably lost or damaged.” On April 13, 2013, this Court denied plaintiff’s application to reargue the prior decision holding that “the Court neither overlooked any facts nor misapprehended the law.” D-VYSE and Kwakyeh’s application seeking, inter alia, a preliminary injunction is denied. Significantly, movants fail to establish entitlement to a preliminary injunction since they utterly fail to argue, let alone establish the necessary elements warranting said relief. Moreover, on this record, it is clear, based on the agreement between the parties, that even without a receiver, plaintiff is nevertheless entitled to collect and appropriate rents at 2070. Standard of Review CPLR §6301 describes the grounds upon which the court can grant a preliminary injunction and reads, in pertinent part, as follows: A preliminary injunction may be granted in any action where it appears that the defendant threatens or is about to do, or is doing or procuring or suffering to be done, an act in violation of the plaintiff’s rights respecting the subject of the action, and tending to render the judgment ineffectual, or in any action where the plaintiff has demanded and would be entitled to a judgment restraining the defendant from the commission or continuance of an act, which, if committed or continued during the pendency of the action, would produce injury to the plaintiff. Thus, a preliminary injunction “provide[s] a provisional remedy by maintaining the status quo pending a full hearing on the merits, rather than to determine the ultimate rights of the parties and mandate corrective action” (Jamie B. v. Hernandez, 274 AD2d 335, 336 [1st Dept 2000]). Accordingly, the court should not, on a motion for a preliminary injunction, grant the ultimate relief sought in the underlying action (id. at 336). Because a preliminary injunction substantially limits a defendant’s rights and is, therefore, an extraordinary provisional remedy, it requires a special showing (Margolies v. Encounter, Inc., 42 NY2d 475, 479 [1977]). Stated differently, “[i]njunctions Pendente lite, should be sparingly issued” (Graves v. Lombardi, 42 AD2d 700, 700 [2d Dept 1973]). Hence, a preliminary injunction will only be granted when the party seeking such relief demonstrates a likelihood of ultimate success on the merits, irreparable injury if the preliminary injunction is withheld, and a balance of equities tips them in favor of the moving party (Nobu Next Door, LLC v. Fine Arts Hous., Inc., 4 NY3d 839, 840 [2005]; Doe v. Axelrod, 73 NY2d 748, 750 [1988]; 61 West 62 Owners Corp. v. CGM EMP LLC, 77 AD3d 330, 334 [2010], mod 16 NY3d 822 [2011]; Second on Second Cafe, Inc. v. Hing Sing Trading, Inc., 66 AD3d 255, 264 [1st Dept 2009]; Stockley v. Gorelik, 24 AD3d 535, 536 [2005]). With respect to likelihood of success on the merits, the threshold inquiry is whether the proponent has tendered sufficient evidence demonstrating ultimate success in the underlying action (Doe at 750-751). While the proponent of a preliminary injunction need not tender conclusive proof beyond any factual dispute establishing ultimate success in the underlying action (Sau Thi Ma v. Xuan T. Lien, 198 AD2d 186, 187 [1993], lv dismissed 83 NY2d 847 [1994]; Ying Fung Moy v. Hohi Umeki, 10 AD3d 604, 605 [2004]), “[a] party seeking the drastic remedy of a preliminary injunction must [nevertheless] establish a clear right to that relief under the law and the undisputed facts upon the moving papers” (Gagnon Bus Co., Inc. v. Vallo Transp., Ltd. 13 AD3d 334, 335 [2004]). This, of course, does not mean that plaintiff must conclusively establish guaranteed success on the merits and thus, issues of fact raised by the defendant cannot serve as a basis for denial of any motion seeking a preliminary injunction (Ma at 187; Moy at 605; Stockely at 536; Demartini v. Chatham Green, Inc., 169 AD2d 689, 689 [1st Dept 1991]). In Doe, plaintiffs, a coalition of various members of the medical and pharmaceutical communities, sued seeking a declaration that 100 NYCRR 80.67 — which imposed strict control on certain tranquilizing medications — be declared unconstitutional (Doe at 749). Plaintiffs also sought a preliminary injunction enjoining defendant, the State, from enforcing the challenged regulation (id.). The court denied plaintiffs’ request for a preliminary injunction, holding that because plaintiffs failed to establish that defendant “acted outside of the authority constitutionally delegated to him under the Public Health Law or that the regulation was so lacking in reason for its promulgation that it [was] essentially arbitrary” (id. at 750 [internal citations and quotation marks omitted]), they failed to establish a likelihood of success on the merits (id.). Conversely, in Stockley, the court granted plaintiffs’ — owners of a condominium – application for a preliminary injunction, thereby enjoining defendants — also owners of the condominium — from building a structure, which plaintiffs established would “encroach upon portions of the common elements of the condominium, which may require an easement the defendants did not seek, and would deprive the plaintiffs of the use and enjoyment of certain common elements, as well as portions of their own units” (Stockely at 536). The court held that plaintiffs’ evidence established a likelihood of success on the merits insofar as they demonstrated that they had initially authorized defendants’ proposed construction without being fully apprised of its extent, which did not become known until plans were drawn (id.). With regard to irreparable harm, generally, the inquiry is whether in the absence of a preliminary injunction, usually to preserve the status quo, any judgment in the underlying action would be rendered ineffectual (Ma at 186; Moy at 604). When this is the case, the proponent of a preliminary injunction has demonstrated irreparable harm. In Ma, plaintiff sued to recover payments from a winning lottery ticket, such winnings held by the defendant (id. at 186). Finding that a preliminary injunction was warranted, the court held that since it was clear that defendant intended to spend the proceeds at issue — intending to share the funds with his family — it was clear that absent a preliminary injunction, plaintiff would be irreparably harmed inasmuch as any judgment would be rendered ineffectual (id. at 186). The court in Moy similarly held that plaintiff had demonstrated irreparable harm but for the grant of preliminary injunction. In that case, plaintiff sued to void the transfer of her ownership interest in real property on grounds that such transfer was obtained by fraud (id. at 604). In holding that plaintiff established entitlement to a preliminary injunction, the court noted that “[t]he purpose of a preliminary injunction is to maintain the status quo and prevent the dissipation of property that could render a judgment ineffectual” (id. 604), and thus, that absent the preliminary injunction, defendant could transfer the property, thereby irreparably harming plaintiff (id.). With regard to the balancing of equities, the same requires that the court look at the prejudice which may accrue to the parties in the event the application for an injunction is granted or denied (Ma at 186-187), and usually the equities tip in favor of the party who would be irreparably harmed absent the grant of a preliminary injunction (id. at 187). Thus, should the court determine that plaintiff would be irreparably harmed by denial of the preliminary injunction while defendant would suffer little or no harm if said injunction is granted, then a preliminary injunction should be granted (id.). Pursuant to CPLR §6312(b), prior to the granting of a preliminary injunction, the plaintiff shall give an undertaking in an amount to be fixed by the court, that the plaintiff, if it is finally determined that he or she was not entitled to an injunction, will pay to the defendant all damages and costs which may be sustained by reason of the injunction Thus, an undertaking is a condition precedent to the grant of a preliminary injunction and such requirement cannot be waived by the court (Rourke Developers Inc. v. Cottrell-Hajeck Inc., 285 AD2d 805, 805 [3d Dept 2001]; Smith v. Boxer, 45 AD2d 1054, 1054 [2d Dept 1974]). The amount of such undertaking is solely within the court’s discretion and should be as much as rationally necessary to compensate defendant for any potential damages should it later be determined that a preliminary injunction was unwarranted (Clover St. Assoc. v. Nilsson, 244 AD2d 312, 313 [2d Dept 1997]; Kazdin v. Putter, 177 AD2d 456, 457 [1st Dept 1991]). The undertaking represents the amount and indeed the limit of damages to which defendant will be entitled if it is determined that no preliminary injunction ought to have been granted (Bonded Concrete, Inc. v. Town of Saugerties, 42 AD3d 852, 855 [3d Dept 2007]). Pursuant to CPLR §2501(1) and (2), an undertaking is [a]ny obligation, whether or not the principal is a party thereto, which contains a covenant by a surety to pay the required amount, as specified therein, if any required condition, as specified therein or as provided in subdivision (c) section 2502, is not fulfilled; and…any deposit, made subject to the required condition, of the required amount in legal tender of the United States or in face value of unregistered bonds of the United States or of the state. CPLR §2502(a)(1) and (2) defines a surety as an insurance company r a natural person, except an attorney. Discussion In support of the instant motion, movants submit an affidavit by Kwakyeh, who states in relevant part as follows. Kwakyeh is DVYSE’s managing member and D-VYSE owns 2070. Kwakyeh maintains DPage VYSE’s books and sends each tenant at 2070 monthly invoices. When tenants make a payment, Kwakyeh logs them into a property management software. None of the tenants have complained about the way rents are invoiced and collected nor about how 2070 is managed. Movants submit an affidavit by Sampson Kwakyeh (SK), who states in relevant part, as follows. SK, along with Kwakyeh, owns 2070. Kwakyeh is D-VYSE’s managing member. As 2070 has no superintended, SK, with the aid of handyman, functions in that capacity. As such, he is responsible for 2070′s maintenance and makes himself available to all tenants. Everything between SK and the tenants is well. When repairs are necessary, SK uses 2070′s rental income to pay for them. Because plaintiff has demanded that tenants pay rent to it, SK has been forced to pay for 2070′s utilities and repairs using his own funds. Despite the diversion of rents to plaintiff, the tenants continue to call SK when they need repairs. SK hopes to sell 2070 and needs time to do so. Movants submit an affidavit by Evelyn Della (Della), who states, in pertinent part, as follows. Della is a tenant at 2070. Since 2022, when she moved there, there have been no issues with maintenance or repairs. 2070 is properly maintained and kept clean. Movants submit a document titled “Demand for Rents” (demand). The demand is dated April 24, 2023, is addressed to all tenants at 2070, and it is from plaintiff. The demand apprises the tenants that plaintiff has exercised its right to collect rents under the agreement between the parties and that, going forward, all rents should be paid to plaintiff. Based on the foregoing, D-VYSE and Kwakye’s motion seeking a preliminary injunction is denied. As noted above, a preliminary injunction will only be granted when the party seeking such relief demonstrates a likelihood of ultimate success on the merits, irreparable injury if the preliminary injunction is withheld, and a balance of equities tips them in favor of the moving party (Nobu Next Door, LLC at 840; Doe at 750; 61 West 62 Owners Corp. at 334; Second on Second Cafe, Inc. at 264; Stockley at 536). Here, beyond asserting that the denial of plaintiff’s application seeking to have a receiver appointed at 2070 bars them from appropriating and collecting the rents thereat, movants fail to assert, let alone establish any of the essential elements warranting the issuance of preliminary injunction. As such the instant relief is denied. To the extent that all other relief sought by the movants is premised on the grant of a preliminary injunction, such as sanctions and the reimbursement of expenses incurred by movants as a result of the appropriation of rents, the remainder of the instant motion is also denied. In addition to the foregoing, the instant application is also denied because plaintiff’s opposition and the documents referenced therein evince that the ability to collect rents was agreed upon by the parties and that such right was accorded to plaintiff even if movants were not in default under the loan documents. Accordingly, plaintiff’s right to appropriate the rents at 2070, a contractual right, was in no way affected by this Court’s refusal to appoint a receiver. To be sure, in its decision dated January 10, 2023, this Court, applying applicable law, noted, in a foreclosure action, even where the parties have agreed to the remedy of the appointment of a receiver in the relevant loan documents, such that the Real Property Law would ordinarily require such appointment, the appointment of a receiver is not absolute…Instead, the proponent of a receiver must still establish that absent a receiver, the mortgaged premises is in danger of being irreparably lost or damaged Thus, the issue previously addressed and decided by this Court was whether the language in the loan documents authorizing the appointment of a receiver absolutely entitled plaintiff to the appointment of a receiver. Because plaintiff failed to establish its additional common law burden, this Court concluded that it was not. This Court, therefore, never decided, the issue presently before it, namely whether the agreement between the parties allow plaintiff to collect and appropriate the rents at 2070. Here, a review of the loan documents demonstrates that the clear and unambiguous language within one of the four agreements between the parties does, in fact, authorize plaintiff to collect and appropriate the rents at 2070. Pursuant to a promissory note dated October 31, 2018, Habib loaned D-VYSE $1 million, which the latter agreed to repay via monthly payments, each totaling $5,845.90. The first payment was due on November 20, 2018 and the last payment, along with any principle and accrued interest, was due on October 30, 2023. Pursuant to a mortgage dated October 31, 2018, to secure the note, D-VYSE pledged 2070 s security. In addition, per the mortgage, D-VYSE assigned all of its “right, title, and interest in and to all present and future leases of the Property and all Rents from the Property.” Pursuant to a document titled “Assignment of Rents” (AR) dated October 31, 2018, in order to secure the note, D-VYSE also assigned Habib “the right at any time, and even though no default shall have occurred under this Assignment, to collect and receive the Rents.” To that end, Habib was granted the right to “send notices to any and all tenants of the Property advising them of this Assignment and directing all Rents to be paid directly” to Habib. Pursuant to a document titled “Mortgage and Note Consolidation, Extension and Modification Agreement,” dated October 31, 2018, five separate loans were consolidated into one loan under one note and one mortgage. Lastly, pursuant an assignment, on July 21, 2022, Habib assigned the mortgage to plaintiff. Thus, here, the mortgage and the AR, which were assigned to plaintiff establish that plaintiff has the absolute right to collect and appropriate the rent at 2070. To be sure, it has long been held that absent a violation of law or some transgression of public policy, people are free to enter into contracts, making whatever agreement they wish, no matter how unwise they may seem to others (Rowe v. Great Atlantic & Pacific Tea Company, Inc., 46 NY2d 62, 67-68 [1978]). Consequently, when a contract dispute arises, it is the court’s role to enforce the agreement rather than reform it (Grace v. Nappa, 46 NY2d 560, 565 [1979]). In order to enforce the agreement, the court must construe it in accordance with the intent of the parties, the best evidence of which being the very contract itself and the terms contained therein (Greenfield v. Philles Records, Inc., 98 NY2d 562, 569 [2002]). It is well settled that “when the parties set down their agreement in a clear, complete document, their writing should be enforced according to its terms” (Vermont Teddy Bear Co., Inc. v. 583 Madison Realty Company, 1 NY3d 470, 475 [2004] [internal quotation marks omitted]). Moreover, “a written agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms” (Greenfield at 569). Accordingly, courts should refrain from interpreting agreements in a manner which implies something not specifically included by the parties, and courts may not by construction add or excise terms, nor distort the meaning of those used and thereby make a new contract for the parties under the guise of interpreting the writing (Vermont Teddy Bear Co., Inc. at 475). This approach serves to preserve “stability to commercial transactions by safeguarding against fraudulent claims, perjury, death of witnesses [and] infirmity of memory” (Wallace v. 600 Partners Co., 86 NY2d 543, 548 [1995] [internal quotation marks omitted]). The proscription against judicial rewriting of contracts is particularly important in real property transactions, where commercial certainty is paramount, and where the agreement was negotiated at arm’s length between sophisticated, counseled business people (Vermont Teddy Bear Co., Inc. at 475). Specifically, in real estate transactions, parties to the sale of real property, like signatories of any agreement, are free to tailor their contract to meet their particular needs and to include or exclude those provisions which they choose. Absent some indicia of fraud or other circumstances warranting equitable intervention, it is the duty of a court to enforce rather than reform the bargain struck (Grace v. Nappa, 46 NY2d 560, 565 [1979]). In the absence of fraud or other wrongful act, a party who signs a written contract is presumed to know and have assented to the contents therein (Pimpinello v. Swift & Co., 253 NY 159, 162 [1930]; Metzger v. Aetna Ins. Co., 227 NY 411, 416 [1920]; Renee Knitwear Corp. v. ADT Sec. Sys., 277 AD2d 215, 216 [2d Dept 2000]; Barclays Bank of New York, N.A. v. Sokol, 128 AD2d 492, 493 [2d Dept 1987]; Slater v. Fid. & Cas. Co. of N.Y., 277 AD 79, 81 [1st Dept 1950]). In discussing this long-standing rule the court in Metzger stated that [i]t has often been held that when a party to a written contract accepts it as a contract he is bound by the stipulations and conditions expressed in it whether he reads them or not. Ignorance through negligence or inexcusable trustfulness will not relieve a party from his contract obligations. He who signs or accepts a written contract, in the absence of fraud or other wrongful act on the part of another contracting party, is conclusively presumed to know its contents and to assent to them and there can be no evidence for the jury as to his understanding of its terms. This rule is as applicable to insurance contracts as to contracts of any kind. (Metzger at 416 [internal citations omitted]). Provided a writing is clear and complete, evidence outside its four corners “as to what was really intended but unstated or misstated is generally inadmissible to add to or vary the writing” (W.W.W. Assoc., Inc. v. Giancontieri, 77 NY2d 157, 162 [1990]; see Greenfield v. Philles Records, Inc., 98 NY2d 562, 569 [2002]; Mercury Bay Boating Club Inc. v. San Diego Yacht Club, 76 NY2d 256, 269-270 [1990]; Judnick Realty Corp. v. 32 W. 32nd St. Corp., 61 NY2d 819, 822 [1984]). Whether a contract is ambiguous is a matter of law for the court to decide (id. at 162; Greenfield at 169; Van Wagner Adv. Corp. v. S & M Enterprises, 67 NY2d 186, 191 [1986]). A contract is unambiguous if the language it uses has “definite and precise meaning, unattended by danger of misconception in purport of the agreement itself, and concerning which there is no reasonable basis for a difference of opinion” (Greenfield at 569; see Breed v. Ins. Co. of N. Am., 46 NY2d 351, 355 [1978]). Hence, if the contract is not reasonably susceptible to multiple meanings, it is unambiguous and the court is not free to alter it, even if such alteration reflects personal notions of fairness and equity (id. at 569-570). Notably, it is well settled that silence, or the omission of terms within a contract are not tantamount to ambiguity (id. at 573; Reiss v. Financial Performance Corp., 97 NY2d 195, 199 [2001]). Instead, the question of whether an ambiguity exists must be determined from the face of an agreement without regard to extrinsic evidence (id. at 569-570), and an unambiguous contract or a provision contained therein should be given its plain and ordinary meaning (Rosalie Estates, Inc. v. RCO International, Inc., 227 AD2d 335, 336 [1st Dept 1996]). Notably, while the parol evidence rule forbids proof of extrinsic evidence to contradict or vary the terms of a written instrument, it has no application in a suit brought where there are claims of fraud in the execution of an agreement or to rescind a contract on the ground of fraud (Sabo v. Delman, 3 NY2d 155, 161 [1957]; Adams v. Gillig, 199 NY 314, 319 [1910]; Berger-Vespa v. Rondack Bldg. Inspectors Inc., 293 AD2d 838, 840 [3d Dept 2002]). Accordingly, per the clear and unambiguous language in the AR, plaintiff, to which Habib’s rights thereunder were assigned, grant it “the right at any time, and even though no default shall have occurred under this Assignment, to collect and receive the Rents” and to “send notices to any and all tenants of the Property advising them of this Assignment and directing all Rents to be paid directly.” Thus, the instant motion is denied for this additional reason, namely, that as a matter of law, plaintiff has the right to do exactly what it has done — collect and appropriate the rent at 2070. Accordingly, it is hereby ORDERED that plaintiff serve a copy of this Decision and Order upon all parties within thirty (30) days hereof. 1. CHECK ONE CASE DISPOSED X NON-FINAL DISPOSITION 2. MOTION/CROSS-MOTION IS GRANTED X DENIED GRANTED IN PART OTHER 3. CHECK IF APPROPRIATE SETTLE ORDER SUBMIT ORDER DO NOT POST FIDUCIARY APPOINTMENT9 REFEREE APPOINTMENT NEXT APPEARANCE DATE: Dated: August 17, 2023
