| Sealy v Clifton, LLC |
| 2009 NY Slip Op 09207 [68 AD3d 846] |
| December 8, 2009 |
| Appellate Division, Second Department |
| Daryl Sealy, Respondent, v Clifton, LLC, et al.,Appellants. |
—[*1] Mark H. Stofsky, Brooklyn, N.Y., for respondent.
In an action for the partition of real property, the defendants appeal from an order of theSupreme Court, Kings County (Hinds-Radix, J.), dated October 20, 2008, which denied theirmotion pursuant to CPLR 3211 (a) (3) and (7) to dismiss the only cause of action, which was forpartition, on the grounds that the plaintiff lacked legal capacity to sue and failed to state a causeof action, and to cancel a notice of pendency, and granted the plaintiff's cross motion for leave toamend the complaint to add causes of action for leave to wind up the affairs of the defendantClifton, LLC, pursuant to Limited Liability Company Law § 703 and for an accounting.
Ordered that the order is modified, on the law, by deleting the provisions thereof denying thedefendants' motion pursuant to CPLR 3211 (a) (3) and (7) to dismiss the only cause of action,which was for partition, and to cancel the notice of pendency, and substituting thereforprovisions granting those branches of the motion; as so modified, the order is affirmed, withoutcosts or disbursements; and it is further,
Ordered that the County Clerk, Kings County, is directed to cancel the notice of pendencydated May 5, 2008, indexed against section 7, block 1903, lots 1001 and 1002 on the map of theCity of New York.
The plaintiff and the late Charles Alston formed Clifton, LLC (hereinafter Clifton), a limitedliability company, for the purpose of investing in real estate. The plaintiff and Alston eachowned a 50% interest in Clifton. In furtherance of Clifton's business, two commercialcondominium units in Brooklyn (hereinafter the properties) were purchased in the name ofClifton. Following Alston's death, the plaintiff commenced this action seeking partition ofClifton's properties, and filed a notice of pendency with respect to the properties. The defendantsmoved to dismiss the only cause of action, which was for partition, on the grounds that theplaintiff lacked legal capacity to sue and failed to state a cause of action, and to cancel the noticeof pendency. The plaintiff cross-moved to amend the complaint to add causes of action for leaveto wind up the affairs of Clifton, and for an accounting. The Supreme Court denied the motionand granted the cross motion. We modify and grant the motion.
Since the properties in question are owned by Clifton, the plaintiff cannot maintain a causeof action for partition in his individual capacity (see Daly v Messina, 51 AD3d 856 [2008]; Greshin vSloane, 138 AD2d 569, 570 [1988]; see also Harvey v Metz, 271 App Div 788[1946]; O'Connor v O'Connor, 249 App Div 515, 516 [1937]). Further, since the plaintifflacks legal capacity to sue for partition, and the complaint fails to state a cause of action for thatrelief, the judgment demanded is not one that would affect the title to, or the [*2]possession, use, or enjoyment of, real property (see CPLR6501). The fact that the plaintiff's proposed amended complaint states causes of action for leaveto wind up the affairs of Clifton and for an accounting of Clifton cannot be a basis for saving thenotice of pendency, since "a subsequent amended complaint cannot be used to justify an earliernotice of pendency" (5303 Realty Corp. v O & Y Equity Corp., 64 NY2d 313, 320[1984]; see Makan Land Dev.-Three,LLC v Prokopov, 42 AD3d 439 [2007]). In any event, a cause of action to wind up theaffairs of a limited liability company (see Limited Liability Company Law § 703[a]) would not support a notice of pendency, as "[a] membership interest in the limited liabilitycompany is personal property," and "[a] member has no interest in specific property of thelimited liability company" (Limited Liability Company Law § 601; see Yonaty v Glauber, 40 AD3d1193, 1195 [2007]; see also Liffiton v DiBlasi, 170 AD2d 994 [1991]; GeneralProp. Corp. v Diamond, 29 AD2d 173, 176 [1968]). Accordingly, the Supreme Court shouldhave dismissed the only cause of action, which was for partition, and canceled the notice ofpendency filed in connection with the properties.
However, the Supreme Court properly granted the plaintiff's cross motion for leave to amendthe complaint to add causes of action for leave to wind up the affairs of Clifton and for anaccounting. The proposed amendments "were neither palpably insufficient nor patently devoid ofmerit, and the defendants did not demonstrate prejudice or surprise from the same" (Gitlin v Chirinkin, 60 AD3d 901,902 [2009]). Contrary to the defendants' contention, Clifton was not previously dissolved. Thereis nothing in the record to indicate that the affairs of Clifton were wound up as required byLimited Liability Company Law § 701, that the articles of dissolution were filed with theSecretary of State as required by Limited Liability Company Law § 705, or that, if Cliftonhad been dissolved and Alston had elected to continue the business while he was still alive,Alston had served Sealy with notice of that election, as required by Clifton's operatingagreement.
The defendants' remaining contention is without merit. Skelos, J.P., Eng, Leventhal andChambers, JJ., concur. [Prior Case History: 21 Misc 3d 1124(A), 2008 NY Slip Op52165(U).]