| Kilmer v Miller |
| 2012 NY Slip Op 04448 [96 AD3d 1133] |
| June 7, 2012 |
| Appellate Division, Third Department |
| Richard H. Kilmer et al., Respondents, v George Miller et al.,Appellants. |
—[*1] Freeman & Howard, P.C., Hudson (Paul M. Freeman of counsel), for respondents.
Malone Jr., J. Appeal from an amended order of the Supreme Court (Hummel, J.), enteredOctober 4, 2011 in Rensselaer County, which, among other things, partially denied defendants'motion to dismiss the complaint.
In February 2004, defendants entered into a contract with plaintiffs to purchase plaintiffs'property located in Rensselaer County. The contract required defendants to make a downpayment prior to closing and then to pay a monthly amount for 20 years, at the end of which timethe remaining balance was to be paid in full and defendants would receive a warranty deed to theproperty. Defendants were also required to pay the real property taxes and the cost of any repairsand maintenance to the property, and maintain relevant insurance policies. The contractcontained a clause whereby, in the event of defendants' default, plaintiffs could demand paymentof the remainder of the agreed-upon purchase price and, if defendants refused to pay, anymonthly payments made prior to the default would be deemed rent and the agreement to purchasethe property would be terminated. In addition, the parties entered into an agreement fordefendants' purchase of plaintiffs' furniture and other miscellaneous items.
In November 2010, defendants provided written notice to plaintiffs that they were unable tomake further monthly payments, admitted default for the payments due in October andNovember 2010, and stated that they had vacated the property. Concurrently, plaintiffs providedwritten notice to defendants of the default in the payment of the monthly payments, late fees, real[*2]property taxes and insurance premiums and demandedpayment and proof of payment of all amounts, including an unpaid balance of the furniturepurchase agreement. Plaintiffs also informed defendants that they were exercising their option inthe contract to accelerate payment of the balance of the purchase price.
After defendants failed to comply with their request, plaintiffs commenced this breach ofcontract action in January 2011. In lieu of answering, defendants moved to dismiss thecomplaint, asserting that the action was barred by the terms of the contract. Plaintiffs opposedthat motion and cross-moved for summary judgment. Based upon the language of the contract,Supreme Court partially granted defendants' motion by dismissing the portions of the complaintseeking payment of late fees, additional rent, costs and counsel fees. The court partially grantedplaintiffs' cross motion for summary judgment after finding that, although the amounts remaineda question of fact, defendants were liable for any unpaid property taxes, damage to the property,the cost of insurance, and any unpaid balance with respect to the furniture purchaseagreement.[FN1]Defendants appeal.
Defendants contend that Supreme Court improperly granted plaintiffs' motion for summaryjudgment with respect to liability and that, instead, the court should have fully granted theirmotion to dismiss the complaint because plaintiffs' claims are barred by the documentaryevidence. Such motion to dismiss succeeds when "the documentary evidence utterly refutes [the]plaintiff's factual allegations, conclusively establishing a defense as a matter of law" (Goshenv Mutual Life Ins. Co. of N.Y., 98 NY2d 314, 326 [2002]; see CPLR 3211 [a] [1];Mason v First Cent. Natl. Life Ins. Co.of N.Y., 86 AD3d 854, 855 [2011]).
Here, according to the unambiguous terms of the parties' contract, after a default bydefendants,[FN2]in the event that plaintiffs exercised their option to accelerate payment of the remaining balanceof the purchase price and defendants failed to tender such payment, the "agreement, and all rightsand obligations [t]herein, [would] become null and void." In that situation, the contract expresslystated that plaintiffs would be "entitled to retain any and all monies paid by [defendants] to thedate of default, and accruing thereafter, as liquidated damages." In addition, the contractexpressly stated that "neither party [would] have any other claim against the other for anyobligations [t]herein." Thus, pursuant to the plain language of the contract, by exercising theiroption to accelerate the balance owed at the time of defendants' default, plaintiffs relinquishedtheir right to bring any claim against defendants and accepted as their sole measure of damagesas a result of the default the retention of all of the monies that had been paid out bydefendants.[FN3]Thus, we cannot agree with Supreme Court's finding that [*3]defendants' default rendered the parties' agreement null and voidonly with respect to defendants' obligation to make the monthly installment payments, and thatdefendants remain liable for "ancillary amounts" such as insurance, taxes, maintenance andrepairs. Rather, the plain language of the contract conclusively establishes that, under thecircumstances presented here, all rights and obligations between the parties became nulland void, which necessarily includes defendants' obligation to pay those ancillary amounts.Accordingly, Supreme Court should have granted that part of defendants' motion to dismiss thefirst and second causes of action (see Goshen v Mutual Life Ins. Co. of N.Y., 98 NY2d at326; 30th Place Holdings, LLC v474431 Assoc., 54 AD3d 753 [2008]).
Finally, we do not agree with Supreme Court that the document in the record entitled "Bill ofSale—Furniture & Lawn Mower" is part of the installment contract. On its face, thedocument represents a separate additional contract between the parties by which plaintiffs agreedto sell to defendants furniture and a lawn mower for $19,000, to be paid in full before December1, 2004, and does not refer to the installment contract in any way (compare Bronxville Knollsv Webster Town Ctr. Partnership, 221 AD2d 248 [1995] [a mortgage and note that werenegotiated and executed together will be considered to be an integrated contract to purchase realproperty]). Although plaintiffs allege in their complaint that defendants owe $4,100 on that billof sale, there is insufficient proof in the record to establish as a matter of law whether defendantsfailed to satisfy their obligation pursuant to that agreement and the amount, if any, that they mayowe to plaintiffs. Accordingly, that part of plaintiffs' cross motion for summary judgment shouldhave been denied and defendants' motion to dismiss the third cause of action was properlydenied.
Peters, P.J., Rose, Lahtinen and Garry, JJ., concur. Ordered that the amended order ismodified, on the law, without costs, by reversing so much thereof as partially granted plaintiffs'cross motion for summary judgment and denied that part of defendants' motion to dismiss thefirst and second causes of action; plaintiffs' cross motion denied to said extent, defendants'motion granted to said extent and the first and second causes of action dismissed; and, as somodified, affirmed.
Footnote 1: Although plaintiffs' crossmotion for summary judgment was made prior to joinder of issue, defendants failed to registerwith Supreme Court any objection to that motion as untimely and that argument cannot be madefor the first time on appeal (see e.g.Finsel v Wachala, 79 AD3d 1402, 1403 n 2 [2010]).
Footnote 2: There is no dispute thatdefendants were in default on the contract.
Footnote 3: This included the initial downpayment as well as the monthly payments, which amounted to more than $200,000 over thecourse of six years.