Business case + holdings

GlobalRealtyServs.LLCv4061HylanLLC1 xGlobalRealtyServicesvs4061HylanLLC-PaperOutline. xGlobalRealtyServs._LLCv4061HylanLLC_2020N.Y.M-21 382WritingAssignment1

1 Kuttel

Global Realty Servs., LLC Plaintiff(s),v. 4061 Hylan LLC Defendant(s)

Facts:

Plaintiff, Global Realty Services, LLC is a limited liability corporation in New York.

Plaintiff, Schuckman Realty Inc. is a domestic corporation in New York.

Both Plaintiffs are real estate brokerages involved in commercial transactions which includes “high value” tenants for vacant commercial properties.

Defendant 4061 Hylan LLC. is a domestic limited liability real estate holding corporation in New York, same as Defendant Golden Hand.

Defendant Jhong Uhk Kim is the owner and operator of both of these corporations, which makes him a commercial real estate developer and landlord in Staten Island.

Plaintiffs filed a Summons and Complaint of breach of contract on November 10, 2016 due to defendant Kim not paying a commision of one-hundred thousand dollar for the Plaintiffs services.

Plaintiffs called three witnesses Howard Seidenfeld, Stanly Schuchman, and Steve Gilman and offered five documents into evidence.

Defendants only called Mr. Kim as a witness and six documents into the evidence.

Plaintiffs endeavored to establish that they entered a commercial brokerage agreement with the Defendants’, specifically Kim.

The Plaintiffs wanted a sum of $694,260 for damages in the Defendants’ failure to pay a commission for their services, however, defendants deny any existence of a contract.

Plaintiff Howard Seidenfeld testified that a phone call between himself and Defendant Kim was held in 2005, where Mr. Kim requested for his commercial real estate services about seeking a high value commercial tenant.

Due to this phone call, Seidenfeld contacted the Director of Real Estate at CVS, Mr. Al Calegari to schedule a meeting with Defendant Kim.

Seidenfeld, Calegari, and Kim met up several times to discuss the details about a potential tenancy, which also led to a walk of the desired property. Defendant Kim contacted Mr. Seidenfeld to request a letter outlining the amount of commission, which was discussed to be an amount of $100,000 payable upon securing City Planning approvals or a “full customary commission”.

Mr. Seidenfeld stated that Defendant Kim agreed to these terms at the time of the phone call, in doing so implying a verbal contract. This oral commission was transferred to a written letter by Mr. Seidenfeld abiding the terms discussed in the phone call, however no alternate commission or calculating method was specified. Defendant Kim did not ever answer this letter.

A separate agreement was made between the Plaintiffs as co-brokers where Global Realty Services ordered $60,000 and Schuckman Realty demanded $40,000 upon “city planning approval”.

Defendant Kim has a complete different memory of these events. Kim states that Mr. Seidenfeld called him to propose CVS in renting his property. Defendant Kim does claim that a brief initial meeting was held between Mr. Calegari and Mr. Seidenfeld, but states that he does not recall any other meetings held around that topic afterwards. Defendant Kim also stated that he hired an attorney in Connecticut to sort out negotiations but cannot recollect the name. Mr. Kim admits to inquiring about the amount of

commission but claims to have never received a formal letter. The Court does not credit Defendant Kim’s recollections.

Even though there are conflicting stories in this case, CVS began a commercial real estate lease on May 8, 2008, which was signed by Defendant Kim and the representatives from CVS.

The Court found satisfactory evidence that the parties entered into an express contract. Therefore the Plaintiffs are also entitled to investigate the possibility of an implied contract.

Defendant Kim breached the commercial real estate contract when he failed to pay the commission following the agreed upon payment date, July 2012.

Defendants point out that the Plaintiffs acknowledged that they never provided the Defendants with a formal written agreement. Therefore, they argue for a Statute of Frauds which is not applicable to this case because “a commission agreement with a real estate broker does not fall within the Statute of Frauds”.

Defendants also raise the General Obligations Law §5-701(a)(1) since it was unclear whether City Planning approval could be fully performed in one year, although both parties agree that this would be very unlikely.

Defendant Kim debates that it would be legally impossible to reach an agreement on terms of the real estate brokerage due to Mr. Kim not owning all of the properties that he aspired to rent, but it was an unpersuasive argument to the court due to credible testimony by the Plaintiffs.

The Supreme Court of New York recognized that a commercial real estate contract existed and was formed orally between the Plaintiffs and the Defendants. It was conceded that Defendant Kim breached the contract by not paying the commission of $100,000 for the plaintiffs services.

Due to this, the Plaintiffs seek $694,260 for the damages which, due to the Court’s decision, ends up being a combined sum of $100,000 in damages with $60,000 going to Global Realty and $40,000 going to Schuckman Realty all coming from Jhong Uhk Kim personally. This decision was mainly based on the absence of methods used to calculate the commission in the contract.

Issues:

Whether a commercial real estate contract between the Plaintiffs (Global Realty Services and Schuckman Realty) and the Defendant Jhong Uhk Kim exists and if so if there is a breach in that contract.

Holding:

The Supreme Court of New York recognized that a commercial real estate contract existed and was formed orally between the Plaintiffs and the Defendants. It was ruled that the Plaintiff’s services had a direct correlation to the Defendants success in finding a lease. It was conceded that Defendant Kim breached the contract by not paying the commission of $100,000 for the Plaintiffs services.

Rationale:

Although Defendant Kim’s recollections of the events were not credited by Court, both the Plaintiffs and Defendants stated and agreed that a phone call between the two of them was held discussing CVS potentially leasing of Defendant Kim’s property. This action led to the proof of a verbal contract existing due to both of them agreeing that the call indeed took place.

In addition both the Plaintiff and the Defendant agreed that an initial meeting was held between Mr. Calegari from CVS, Mr. Seidenfeld, and Mr. Kim to discuss the rental in more detail.

Furthermore the physical lease between CVS and the Defendant Kim proved that Mr. Kim owed the Plaintiff money for their services.

Finally the physical letter written by Mr. Seidenfeld discussing the rate of commission that was sent to Mr. Kim shows that Mr. Kim did not obey the guidelines of the verbal contract due to him not responding.

Kuttel

Ryan Kuttel

Thomas M. Madden

Legal Foundations of Business

17 April 2020

Global Realty Services vs 4061 Hylan LLC- Paper Outline.

I will be taking into account the events for the case between Global Realty Services vs 4061 Hylan LLC. This case discussed whether a commercial real estate contract between Global Realty Services and the Hylan LLC existed and if so if there is a breach in that contract.

I will be using approved cases:

· Thor Properties v. Willspring Holdings LLC

· Steinberg v. Chicago Medical School

I will be using articles:

Contract Theory and the Limits of Contract Law

Schwartz, Alan, and Robert E. Scott. “Contract Theory and the Limits of Contract Law.” The Yale Law Journal, vol. 113, no. 3, 2003, pp. 541–619. JSTOR, www.jstor.org/stable/3657531. Accessed 16 Apr. 2020.

Fault in Contract Law

Posner, Eric A. “Fault in Contract Law.” Michigan Law Review, vol. 107, no. 8, 2009, pp. 1431–1444. JSTOR, www.jstor.org/stable/40380336. Accessed 16 Apr. 2020.

Can There Be a Social Contract with Business?

Hodapp, Paul F. “Can There Be a Social Contract with Business?” Journal of Business Ethics, vol. 9, no. 2, 1990, pp. 127–131. JSTOR, www.jstor.org/stable/25072014. Accessed 16 Apr. 2020.

In this case the Supreme Court of New York found that a commercial real estate contract existed and was formed orally between the Plaintiffs and the Defendants. It was ruled that the Plaintiff’s services had a direct correlation to the Defendants success in finding a lease. This case highlights how I intend to find the flaws for some rules and regulations that are indeed renowned to be flimsy arguments yet are justified in the court of law calling into question the faults of the system of contract law. We see how in business contract law can also be a disservice to some parts of society often in the favor of contracts favoring the minority of some businesses putting at a disadvantage to majority, we see examples like this with the contracts between employees and taxi conglomerate uber.

No Shepard’s Signal™
As of: March 19, 2020 2:06 PM Z

Global Realty Servs., LLC v 4061 Hylan LLC

Supreme Court of New York, Richmond County

February 3, 2020, Decided

151526/2016

Reporter
2020 N.Y. Misc. LEXIS 491 *; 2020 NY Slip Op 50136(U) **; 66 Misc. 3d 1220(A); 2020 WL 611921

Judges: Hon. Catherine M. DiDomenico, Acting Justice

Supreme Court.

Opinion by: Catherine M. DiDomenico

Opinion

Catherine M. DiDomenico, J.

Plaintiff, Global Realty Services, LLC is a limited liability

corporation located and operating in New York. Plaintiff,

Schuckman Realty Inc. is a domestic corporation

located and operating in New York. Both Plaintiffs in this

action are real estate brokerages involved primarily in

commercial transactions, including the procurement of

“high value” tenants for vacant commercial properties

throughout New York City. At trial, Global Realty

appeared by its principal Howard Seidenfeld and

Schuckman Realty appeared by its principal Stanley

Schuckman. At all times the Plaintiffs in this action were

represented by the Law Firm of Gaines & Fishler, LLP.

Defendant 4061 Hylan LLC. is a domestic limited liability

real estate holding corporation located and operating in

New York. Defendant Golden Hand is also a domestic

corporation located and operating in New York.

Defendant Jhong Uhk Kim is the principal owner /

operator of these two corporations and a resident

of [*2] New York State. Defendant Kim is a commercial

real estate developer and landlord of various

commercial properties in Staten Island. In addition to his

real estate holdings, Defendant Kim is a sophisticated

businessman involved in various other commercial

enterprises including a chain of martial arts schools, and

a restaurant. At all times the Defendants in this action

were represented by the Law Firm of Howard File Esq.

The Plaintiffs commenced the present breach of

contract action by the filing of a Summons and

Complaint on November 10, 2016. Defendants filed a

Verified Answer on June 6, 2012. After preliminary

proceedings concluded, the matter was certified for a

Jury Trial and [**2] referred to this Part for

adjudication. However, at a pre-trial conference all

parties stipulated to disband the Jury and proceed to a

bench trial on all issues.

The matter proceeded to a bench trial on June 12, 2019

and concluded the next day on June 13, 2019. The

Plaintiffs called three witnesses in support of their case,

Howard Seidenfeld, Stanley Schuchman, and Steve

Gilman. Plaintiffs offered five documents into evidence

(Plaintiffs’ 1-5). Defendants only called Mr. Kim as a

witness and offered six documents [*3] into evidence

(Defendants’ A-F). Both parties stipulated to the

admissibility of all the documents offered.

At trial, the Plaintiffs attempted to establish that they

entered into a commercial brokerage agreement with

the Defendants, specifically Defendant Kim, and that

they are entitled to damages in the sum of $694,260 for

the Defendants’ failure to pay a commission for their

services. Defendants, in opposition, deny the existence

of a contract arguing that there was never a meeting of

the minds on certain essential terms. In the alternative,

Defendants raise various affirmative defenses to the

enforcement of any alleged contract that may have

been formed between the parties.

Decision

1. Breach of Contract

Plaintiffs’ action sounds in contract. “To maintain an

action for breach of contract, a party must show three

elements: the existence of a contract, the defendant’s

breach of that contract, and damages.” Kuzma v.

Protective Ins. Co., 104 A.D.3d 820, 962 N.Y.S.2d 310,

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Global Realty Servs., LLC v 4061 Hylan LLC

2013 NY Slip Op 1809 (2d Dept. 2013). In order to

establish the existence of an enforceable contract, a

plaintiff must generally establish an offer, acceptance,

consideration, mutual asset, and an intent to be bound.

See Kolchins v. Evolution Mkts., Inc. 128 AD3d 47, 8

N.Y.S.3d 1 (1st Dept. 2015). Generally, a meeting of the

minds must be reached on all essential terms of an

agreement. See Trylon Realty Corp. v. Di Martini, 34

NY2d 899, 316 N.E.2d 718, 359 N.Y.S.2d 284

(1974). [*4] However, in relation to real estate

brokerage contracts, an agreement may be express, or

implied. See Joseph P. Day Realty Corp. v. Chera, 308

AD2d 148, 762 N.Y.S.2d 373 (1st Dept. 2003). In the

absence of an express agreement, an implied contract

may be established by a “conscious appropriation of the

labors of the broker in some cases by the mere

acceptance of the labors of a broker.” Sibbald v.

Bethlehem Iron Co., 83 N.Y.378 (1881); see also

Friedland Realty Inc. v. Piazza, 273 AD2d 351, 710

N.Y.S.2d 97 (2d Dept. 2000).

If a broker can establish that he or she had an express

or implied contract, a commission is generally due

when the broker produces a tenant who is ready, willing

and able to agree to the landlord’s lease terms. See

Rusciano Realty Services, Ltd. v. Griffler, 62 NY2d 696,

465 N.E.2d 33, 476 N.Y.S.2d 526 (1984). However,

brokers and their clients are entitled to stipulate to a

different due date for their commission if they so

choose. See Graff v. Billet, 101 AD2d 355, 475

N.Y.S.2d 122 (2d Dept. 1984). To establish entitlement

to a commission, a broker must establish that they were

the “procuring cause” of the resulting lease between

landlord and tenant. See Curtis Props. Corp. v. Greif

Cos., 212 AD2d 259, 628 N.Y.S.2d 628 (1st Dept.

1995); see also Siegel Consultants, Ltd. v. Nokia, Inc.,

2010 NY Slip Op 33840(U) (Sup. Ct. NY Cty. 2010).

When a lease “admits the broker’s performance of

services and includes an express promise by the seller

[or landlord] to pay the commission” that lease amounts

to prima facie evidence that the broker is entitled to a

commission. Halstead Brooklyn, LLC v. 96-98 Baltic,

LLC, 49 AD3d 602, 854 N.Y.S.2d 437 (2d Dept. 2008);

see also Holiday Management Assoc., Inc. v. Albanese,

173 AD2d 775, 570 N.Y.S.2d 643 (2d Dept. 1991).

Here, the representative of Plaintiff Global Realty,

Howard Seidenfeld, credibly testified [*5] that sometime

in 2005 he received a phone call from Defendant Kim

wherein his services as a commercial real estate broker

were requested. Specifically, Defendant Kim indicated

that he [**3] was in the process of purchasing and

consolidating several parcels of commercial real estate

and would be seeking a high value commercial tenant

(Tr. 6/12/19 pg. 13). As a result of this initial

conversation Mr. Seidenfeld contacted the Director of

Real Estate at CVS, Mr. Al Calegari, and scheduled a

meeting with Defendant Kim. At the time of the

Defendant’s phone call, Mr. Seidenfeld was employed

by Plaintiff Schuckman Realty, however, sometime in

2005 Mr. Seidenfeld left Schuckman Realty and opened

Global Realty.

Defendant Kim, Mr. Calegari, and Mr. Seidenfeld

subsequently met several times at Defendant Kim’s

restaurant to discuss and negotiate the terms of a

potential tenancy. They also met to “walk the property”

that Defendant Kim was intending to rent. In addition to

these three-party meetings, Defendant Kim met

individually with representatives of CVS. In or around

June of 2006, Mr. Seidenfeld became aware that

Defendant Kim and CVS were close to an agreement on

lease terms. At or around that time, [*6] Mr. Seidenfeld

received a phone call from Defendant Kim wherein the

Defendant requested a letter outlining the amount of

commission that would be payable, as he would not sign

a lease without that information. During that

conversation the parties discussed a commission in the

amount of $100,000 payable upon securing city

planning approvals, or a “full customary commission” if

payment wasn’t timely made. Mr. Seidenfeld credibly

testified that Defendant Kim orally agreed to these

terms. (Tr. 6/12/19 pgs. 19-20). In compliance with the

Defendant’s request, Plaintiff Global Realty reduced the

oral commission agreement to a letter (dated June 29,

2006) which indicates that a commission of $100,000

would be due upon “

securing city planning approvals.”

(Pl. Ex. 3). While there is an implication in the letter that

a different amount might be due if the commission was

not paid upon securing the approvals1, no alternate

commission, or method of calculating an alternate

commission, is indicated. Moreover, while the letter

indicates that a formal commission agreement would be

forwarded to the Defendants, Mr. Seidenfeld admits that

he never actually prepared that document. Defendant

Kim never responded [*7] to the letter.

On or about April 27, 2015 the Plaintiffs jointly sent

1 The relevant section reads “I am pleased to confirm to you

that Schuckman Realty Inc. and Global Realty Services, LLC

have agreed to co-broke the leasing commission in connection

with the lease of the above highlighted property to CVS in the

amount of $100,000 assuming such payments will be paid in

full upon you, as landlord, or any other entity controlled by you

securing city planning approvals.”

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Global Realty Servs., LLC v 4061 Hylan LLC

Defendant Kim a pair of invoices demanding the agreed

upon $100,000 commission. (Pl. Ex. 5). As per a

separate agreement between the Plaintiffs as co-

brokers, Global Realty Services demanded payment in

the amount of $60,000 and Schuckman Realty

demanded payment in the amount of $40,000.2 Both

invoices indicate that payment would be due upon “city

planning approval” even though those approvals were

granted over two years before the date of the invoice.

Defendant Kim’s recollection of the relevant events is

significantly different. According to the Defendant, it was

Mr. Seidenfeld who called him and suggested that CVS

might be interested in renting his property. Defendant

Kim admits that there was one initial meeting between

himself, Mr. Calegari from CVS and Mr. Seidenfeld, but

then claims that both Mr. Calegari and Mr. Seidenfeld

“disappeared” shortly thereafter (Tr. 6/13/19 pg.12).

Defendant Kim could not recall if they ever had a

meeting again regarding this property. Defendant also

[**4] disputes that Mr. Seidenfeld participated in

negotiations regarding the CVS lease. He claims that he

hired an attorney in Connecticut [*8] to handle the

negotiations, however he could not recall the attorney’s

name. (Tr. 6/13/19 pg.13). Defendant Kim does admit

that he contacted Mr. Seidenfeld to inquire about the

amount of the commission that he owed. (Tr. 6/13/19

pg.22). However, he claims that he never received the

June 29th letter setting forth the $100,000 amount or the

April 2015 invoices. The Court does not credit

Defendant Kim’s recollection of these events.

While the parties disagree as to how CVS was obtained

as a tenant, and how the lease terms were negotiated,

most of the relevant facts following the signing of the

lease are undisputed. CVS entered into a commercial

real estate lease on May 6, 2008. That lease was

signed by Defendant Kim and representatives from

CVS.3 Both Plaintiffs in this action are identified in the

lease as “brokers” although they did not sign the

contract. (Pl. Ex. 1, Part I Para. 23). The lease clearly

states that the “Landlord [Defendant Kim] warrants and

2 Plaintiff Schuckman agreed to 40% of the commission as Mr.

Seidenfeld was employed by him at the beginning of lease

negotiations, Plaintiff Global would receive the remaining 60%

as the agreement was reached after Mr. Seidenfeld left

Schuckman’s employ.

3 The tenant named in the contract is actually “Hook-SuperX,

L.L.C.” a subsidiary corporation of CVS, but the lease is

signed by CVS representatives, guaranteed by CVS, and a

CVS store operates at the location.

agrees that it shall be solely responsible for any and all

brokerage commissions owing to said Broker(s), as a

result of the negotiation and execution of this Lease.”

(Pl. Ex. 1, Pg 25). City Planning approvals were

received by the [*9] Defendants on or about May 9,

2012. (Def. Ex. D). CVS took occupancy of the building

in or around October of 2015 and remains there to date

as an active commercial tenant.

As indicated above, in order to establish their

entitlement to a commission the Plaintiffs were required

to establish that they entered into an express or implied

contract with the Defendant. See Gluck & Co. Realtors,

LLC v. Burger King Corp., 164 AD3d 562, 83 N.Y.S.3d

518 (2d Dept. 2018). The Plaintiffs have met their

burden at trial. The initial offer was made by Defendant

Kim when he called Mr. Seidenfeld and requested his

services. Mr. Seidenfeld immediately accepted and

began the process of finding a tenant. Mr. Seidenfeld

found a potential tenant (CVS) in 2005. In or around

June of 2006, CVS agreed to the Defendant Kim’s lease

terms and thus became a viable, or “ready willing and

able” tenant. At trial the Plaintiffs established that they

not only introduced Defendant Kim to the CVS

representatives, but also that they helped negotiate

terms over various meetings. Accordingly, there is

sufficient evidence in the record to find that the Plaintiffs

were the “procuring cause” of the resulting lease. See

Zere Real Estate Servs., Inc. v. Parr Gen. Contr. Co.,

Inc., 102 AD3d 770, 958 N.Y.S.2d 708 (2d Dept. 2013).

In June of 2006 Defendant Kim and Mr. Seidenfeld

orally discussed terms of compensation over the

telephone, [*10] and it was agreed that the sum of

$100,000 would be payable at the time of City Planning

approval, or “some other customary fee” would be

payable thereafter. When Defendant Kim requested that

the commission agreement be reduced to a writing, the

Plaintiffs drafted the June 29th letter. Regardless of

whether Defendant Kim received the letter, the parties

completed the formation of an express contract orally

by agreeing that compensation would be at least

$100,000. Moreover, while Defendant Kim now disputes

that either Plaintiff served as his broker in this real

estate transaction, he expressly acknowledged their

services in the lease that he signed with CVS. The lease

clearly identifies both Plaintiffs as brokers and indicates

that Defendant Kim, as an individual, would be the party

solely responsible for their commission. This

acknowledgment is prima facie evidence that the

Plaintiffs are entitled to a commission. See William B.

May Co. v. Monaco Associates, 80 AD2d 798, 437

N.Y.S.2d 91 (1st Dept. 1981); see also Halstead

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Global Realty Servs., LLC v 4061 Hylan LLC

Brooklyn, LLC v. 96-98 Baltic, LLC, 49 AD3d 602, 854

N.Y.S.2d 437 (2d [**5] Dept. 2008).

While this Court has found sufficient evidence in the

record to determine that the parties entered into an

express contract, the Plaintiffs would also be entitled to

recover under a theory of implied contract. [*11] It is

undisputed that the Plaintiffs are licensed real estate

brokers. It is further undisputed that the Plaintiffs

introduced Defendant Kim to the CVS representative,

and that at least one group meeting took place between

the parties and the CVS representative to negotiate

lease terms. Moreover, this Court credits Mr. Seidenfeld’

s testimony that there were actually multiple negotiation

meetings between the parties and CVS. Accordingly,

the Plaintiffs have established that their efforts were a

procuring cause of the lease between CVS and the

Defendant, and moreover, that the Defendant

consciously accepted and benefitted from their services.

As a result, the Plaintiffs are equally entitled to recover a

commission under implied contract theory. See Gronich

& Co. v. 649 Broadway Equities Co., 169 AD2d 600,

565 N.Y.S.2d 18 (1st Dept. 1991); see also Country

Harbor Realty, Inc. v. Sullivan, 23 AD3d 606, 804

N.Y.S.2d 790 (2d Dept. 2005).

After establishing the formation of a contract, express

or implied, the Plaintiffs bear the burden of establishing

a breach of that contract. See Ayers v. City of Mount

Vernon, 176 AD3d 766, 110 N.Y.S.3d 43 (2d Dept.

2019). It is uncontested that Defendant Kim failed to pay

any commission to the Plaintiffs despite the 2015

invoice demanding payment, and an acknowledgment of

his obligation to pay in the 2008 lease. This failure to

pay, after the Plaintiff procured a viable tenant, and city

planning approvals [*12] were obtained, amounts to a

clear breach of the parties’ contract.

2. Statute of Limitations

Defendants raise an affirmative statute of limitations

defense to the Plaintiffs’ breach of contract claim. For a

breach of contract action to be timely it must be filed

within six years of when the breach occurred. See

CPLR §213(2); see also 2138747 Ontario, Inc. v.

Samsung C & T Corp. 144 AD3d 122, 39 N.Y.S.3d 10

(1st Dept. 2016). When a contract cause of action

seeks to recover a sum of money owed, the statute of

limitations is triggered when the party that is owed

money first has the right to demand payment, not when

a demand for payment is actually made. See Fairlane

Fin. Corp. v. Scipione, 174 AD3d 577, 105 N.Y.S.3d 97

(2d Dept. 2019). Here, Defendant Kim breached the

commercial real estate contract when he failed to pay

the broker’s commission following City Planning

Commission approval in July of 2012, as this was the

parties agreed upon date for payment. (Tr. 6/12/19 pg.

19). While the Plaintiffs waited approximately three

years to send an invoice demanding payment, the

statute does not run from the demand, but from the

breach. See Hahn Automotive Warehouse, Inc. v.

American Zurich Ins. Co., 18 NY3d 765, 967 N.E.2d

1187, 944 N.Y.S.2d 742 (2012). As the present action

was commenced with the filing of a Summons and

Complaint in November of 2016, approximately four

years after the date of breach, the action is timely.

3. Statute of Frauds

Defendants raise a second affirmative [*13] defense,

namely that any alleged agreement between the parties

was never reduced to a writing and thus is void ab initio

due to a violation of the Statute of Frauds. In this regard

Plaintiffs concede that they never provided the

Defendants with a formal written agreement. (Tr.

6/12/19 pgs. 73;133). At the onset, it is worth noting that

certain real estate commission agreements are

automatically subject to the Statute of Frauds. See e.g.

Camhi v. Tedesco Realty, LLC, 105 AD3d 795, 962

N.Y.S.2d 660 (2d Dept. 2013). However, real estate

commission agreements, whether express or implied,

entered into by licensed real estate brokers are

specifically exempt from this rule. See General

Obligations Law §5-701(a)(10); see also Elhanani v.

Kuzinez, 172 AD3d 590, 101 N.Y.S.3d 307 (1st Dept.

590). “A commission agreement with a real estate

broker does not fall within the Statute of Frauds.”

Sholom & Zuckerbrot Realty Corp. v. [**6] Citibank,

N.A., 205 AD2d 336, 613 N.Y.S.2d 588 (1st Dept.

1994). As it is undisputed that the Plaintiffs are licensed

real estate brokers, section (a)(10) of the Statute of

Frauds does not apply.

Defendants also rely upon General Obligations Law §5-

701(a)(1) which requires a written contract for any

agreement that by its very terms is incapable of being

fully performed within one year. See City Natl. Bank v.

Morelli Ratner, P.C., 170 AD3d 434, 95 N.Y.S.3d 202

(1st Dept. 2019). As indicated above, the parties agreed

that the Plaintiffs’ broker’s commission would be due

upon the Defendants receiving approval from the City

Planning Commission. [*14] At the time the parties

entered into the agreement it was unclear whether City

Planning approval could be achieved in one year,

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Global Realty Servs., LLC v 4061 Hylan LLC

although both parties now agree that it was extremely

unlikely. While it actually took several years to obtain

the necessary approvals, this Court cannot find, as a

matter of fact or law, that the City Planning approvals

could not have been be received within one years’ time.

The Statute of Frauds only prohibits oral “agreements

which, by their terms, have absolutely no possibility in

fact and law of full performance within one year.” Starr

v. Akdeniz, 162 AD3d 948, 80 N.Y.S.3d 283 (2d Dept.

2018). As long as an agreement may be fairly and

reasonably interpreted such that it may theoretically be

performed within a year, the Statute of Frauds will not

act as a bar, no matter how “unexpected, unlikely, or

even improbable” it is that full performance will occur

during that time frame. See Radnay v. Charge & Ride,

Inc. 266 AD2d 194, 697 N.Y.S.2d 664 (2d Dept. 1999).

Accordingly, a written contract was not necessary. See

Cottone v. Selective Surfaces, Inc., 68 AD3d 1038, 892

N.Y.S.2d 466 (2d Dept. 2009); see also JNG Constr.,

Ltd. v. Roussopoulos, 135 AD3d 709, 22 N.Y.S.3d 567

(2d Dept. 2016).

In any event, the various documents offered at trial,

when viewed in their entirety, amount to a sufficient

memorialization of the parties’ agreement to satisfy the

statute of frauds even if it applied. An agreement may

be satisfied by multiple writings, signed and

unsigned, [*15] providing that “all of the terms must be

set out and at least one writing establishing a

contractual relationship, must bear the signature of the

party to be charged.” Taylor Diversified Corporate

Servs., Inc. v AMBAC Assur. Corp., 81 AD3d 810, 917

N.Y.S.2d 245 (2d Dept. 2011). Here, the various emails,

invoices, and letters sent to the Defendants establish

that the Plaintiffs were acting as commercial real estate

brokers in return for a commission of at least $100,000.

While these initial written communications were not

responded to by Defendant Kim, he assented to their

terms when he specifically named the Plaintiffs as

“brokers” in the CVS lease and acknowledged therein

that it was his sole responsibility, as landlord, to pay

their commission. (Pl. Ex. 1, Pg. 25). As this lease was

signed by the Defendant, the party to be charged, these

various writings, when read in conjunction, establish all

the necessary terms of the parties’ agreement. See

Crabtree v. Elizabeth Arden Sales Corp., 305 N.Y.48,

110 N.E.2d 551 (1953); see also Kelly v. P & G

Ventures 1, LLC, 148 AD3d 1002, 50 N.Y.S.3d 163 (2d

Dept. 2017).

4. Lack of Ownership

In addition to the affirmative defenses indicated above,

Defendant Kim argues that it was legally impossible to

reach an agreement on terms of a real estate brokerage

contract, because at the time he retained the Plaintiffs’

services, he did not own all of the properties that he

sought to rent. This argument is unpersuasive. [*16] As

Mr. Seidenfeld and Mr. Schuckman both credibly

testified, the parties were aware at the time of

negotiation that the Defendants intended to enter into a

“assemblage contract.” As described by Mr. Seidenfeld,

an assemblage contract occurs when a potential

landlord assembles a number of parcels of real estate,

and a broker finds a tenant for when all parcels are

obtained. (Tr. 6/12/19, pgs. 83-84). Notably, Defendant

Kim was ultimately successful in obtaining all of the

relevant parcels of land. In any event, unless explicitly

stated, a landlord’s obligation to pay a brokerage

commission is not conditioned upon [**7] their actual

ability to lease a parcel of property, even if the landlord

does not actually own that property. See B & H Assoc.

of NY, LLC v. Fairley, 148 AD3d 1097, 50 N.Y.S.3d 495

(2d Dept. 2017); see also Kalmon Dolgin Affiliates v.

Estate of George H. Nutman, 172 AD2d 917, 568

N.Y.S.2d 204 (3rd Dept. 1991); Sholom & Zuckerbrot

Realty Corp., v. Citibank, N.A., 205 AD2d 336, 613

N.Y.S.2d 588 (1st Dept. 1994).

5. Damages

As the Plaintiffs have established the existence of a

commercial real estate brokerage contract, and that

Defendant Kim breached that contract by failing to pay

a broker’s commission, the Court must now consider the

Plaintiffs’ claim for damages. In their Verified Summons

and Complaint, the Plaintiffs seek the sum of $694,260

in damages. At trial, Mr. Seidenfeld attempted to

establish what a “reasonable” or “customary”

commission would be [*17] in relation to a similar

commercial real estate brokerage agreement. However,

he also credibly testified that each commission

agreement is specific as to how and when the broker

will be paid, and that conditions of payment can vary

greatly from contract to contract. Specifically, Mr.

Seidenfeld testified that the customary commission to

be paid is “whatever is agreed upon in the agreement.”

(Tr. 6/12/19, pgs. 74-76).

In addition to Mr. Seidenfeld’s testimony regarding his

understanding of the commission at issue, the Plaintiffs

called a second commercial real estate broker as a

witness in an attempt to establish a range of reasonable

damages. Plaintiffs called Steve Gilman, who was

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Global Realty Servs., LLC v 4061 Hylan LLC

qualified by this Court as a “real estate broker with no

particular specialty in determining commissions.” (Tr.

6/12/19 pg. 98). As such, this Court attributes very little

weight to his testimony on the subject of damages. Like

Mr. Seidenfeld, Mr. Gilman credibly testified that every

commercial real estate contract differs as to how the

commission is calculated, in fact, he agreed that “no two

deals are alike.” (Tr. 6/12/19 pg. 110). However, he then

speculated that a reasonable “commission range” for

the [*18] present transaction would be anywhere from

$280,000 to $560,000. (Tr. 6/12/19 pg. 100). Notably,

Mr. Gilman offered this opinion without any knowledge

of the specific details of the present agreement.

The burden of proof is on the Plaintiff to establish

damages. See J.R. Loftus, Inc. v. White, 85 NY2d 874,

649 N.E.2d 1196, 626 N.Y.S.2d 52 (1995). When

determining an appropriate amount of damages in a

breach of contract action the Court is authorized to

award “general damages” that flow naturally and directly

from the breach. See 34-35th Corp. v. 1-10 Indus.

Assoc., LLC, 103 AD3d 709, 959 N.Y.S.2d 519 (2d

Dept. 2013). The Court can also award “consequential

damages” if those damages were contemplated by the

parties and foreseeable at the time the contract was

entered into. See Panasia Estates, Inc. v. Hudson Ins.

Co., 10 NY3d 200, 886 N.E.2d 135, 856 N.Y.S.2d 513

(2008). Damages flowing from a breach of contract

must be non-speculative in nature. See Rakylar v.

Washington Mut. Bank, 51 AD3d 995, 858 N.Y.S.2d 759

(2d Dept. 2008); see also Rondeau v. Berman, 161

AD3d 429, 72 N.Y.S.3d 831 (1st Dept. 2018).

Here, the various calculations set forth by the Plaintiff at

trial regarding what the commission might have been, or

could reasonably be, are clearly speculative. There is no

evidence in the record that the Defendant agreed to, or

could have reasonably foreseen, any of the methods

used to calculate a commission as set forth by the

Plaintiff, or his witness, at trial. Moreover, there is no

documentation setting forth a means of calculation,

which the Plaintiff indicated [*19] would be standard for

such a contract, if a sum certain was not payable. (Tr.

6/12/19 pgs. 75-76). However, Mr. Seidenfeld credibly

testified that Defendant Kim orally agreed to pay the

sum of $100,000 as a commission at or around the time

the lease terms were being finalized. This amount is

also reflected in the June 2006 letter and the April 2015

invoices which were send to the Defendants by both

Plaintiffs. While it may be true that the Defendant Kim

was on notice that the Plaintiffs would expect a higher

commission if the $100,000 was not timely paid, [**8]

he was never on notice of what that amount might be.

This failure falls solely on Plaintiff Global, as Mr.

Seidenfeld indicated in the June 2006 letter that he

would “prepare a formal Commission Agreement,” which

would set forth the method of calculating a commission,

but he failed to do so. Notably, the Plaintiffs testified that

they had no out of pocket expenses related to this

transaction other than the value of their time.

After considering all of the evidence offered at trial, and

the testimony of all parties, this Court awards the

Plaintiffs the combined sum of $100,000 in damages.

$60,000 of this amount shall be apportioned [*20] to

compensate Plaintiff Global Realty and $40,000 to

compensate Plaintiff Schuckman Realty. This 60/40

distribution was agreed upon between the Plaintiffs and

set forth in the April 2015 invoices. The Court finds that

a $100,000 commission, which was orally agreed to by

Defendant Kim, and memorialized in documentary

evidence, is a more equitable measure of damages than

the speculative approximations of what the Plaintiffs’

commission might be under a similar real estate

contract. This ruling is supported by Mr. Seidenfeld’s

admission that any method of calculation would

normally be contained in a formal commission

agreement, and that he failed to prepare one, despite

his indication to the Defendants that he would. The

Plaintiffs are also entitled to interest at the statutory rate

of 9% running from the date of breach, May 9, 2012.

See CPLR §5001, §5004.

The Judgment awarded herein, together with interest,

shall be payable by Defendant Jhong Uhk Kim

personally, and is not being issued against the

corporate Defendants 4051 Hylan LLC, or Golden Hand

of Staten Island, Inc. There is no evidence in the record

to support a judgment against either of these entities. In

this regard, Defendant Kim personally [*21] signed the

CVS lease which acknowledged the Plaintiffs’ right to a

commission as “an individual.” (Pl. Ex. 1 Pg. 31). There

is no indication in that lease that either corporate

defendant was a party to the transaction in any way.

Moreover, there is no indication in the record that any of

Defendant Kim’s conversations with the Plaintiffs were

under the guise of him representing either corporate

entity. Rather, at all times it appears that Defendant Kim

was speaking and acting an in individual capacity.

Accordingly, as there is no evidence in the record that

either Defendant 4051 Hylan LLC or Defendant Golden

Hand entered into a contract with the Plaintiffs, all

causes of action against them are hereby dismissed.

All issues and claims not addressed directly herein are

hereby denied. Specifically, the Plaintiffs’ alternative

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Global Realty Servs., LLC v 4061 Hylan LLC

causes of action for quantum meruit and unjust

enrichment are hereby dismissed as a matter of law

because they constitute “indistinguishable disputes

regarding the same operative facts as the claim for

breach of contract.” See Sears Holdings Mgt. Corp. v.

Rockaway Realty Assoc., LP, 176 AD3d 433, 107

N.Y.S.3d 670 (1st Dept. 2019). “A claim for unjust

enrichment, or quasi contract, may not be maintained

where a contract exists between the parties covering

the same subject [*22] matter.” Goldstein v. CIBC

World Mkts. Corp., 6 AD3d 295, 776 N.Y.S.2d 12 (1st

Dept. 2004).

This constitutes the Decision and Order of the Court

after trial. Plaintiffs may submit a formal Money

Judgment for signature encompassing this Decision’s

findings on Notice to the Defendants counsel. That

Judgment shall either include a calculation of statutory

interest or indicate that statutory interest shall be

calculated by the Judgment Clerk in compliance with the

amounts and dates set forth herein.

Dated: February 3, 2020

Hon. Catherine M. DiDomenico

Acting Justice Supreme Court

End of Document

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Prof. Madden

Spring 2020

LEGAL FOUNDATIONS OF BUSINESS

BUS382 Writing Assignment

In a paper 8-10 pages in length (TNR 12 Pt/250 words per page) starting with one of the cases assigned in

your text reading or for briefing this semester, or another approved case or approved topic involving a case,

answer the following:

1. What is the issue and what is the court’s holding. (Use facts necessary to be clear.)

2. Do you think the holding is correct? Why or why not?

3. What should the holding be? Why?

4. What are the implications of the case holding for business?

5. What are the broader implications of the case for society generally?

6. Are there any additional ethical implications?

In your paper, be sure to…

1. Cite the case you start with and at least 2 related additional cases, using proper citation.

2. Cite at least 3 scholarly articles to support your arguments, using proper citation.

3. Use proper grammar, form, and syntax. DO NOT use casual/conversational language.

4. Make your argument(s) to convince an educated professional.

5. Do your own work. DO NOT collaborate.

6. Submit your paper online to Turn It In on iLEARN.

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