| Bluff Point Townhouse Owners Assn., Inc. vKapsokefalos |
| 2015 NY Slip Op 04905 [129 AD3d 1267] |
| June 11, 2015 |
| Appellate Division, Third Department |
[*1]
| Bluff Point Townhouse Owners Association, Inc.,Respondent, v Lisa Kapsokefalos, Appellants. |
The Clements Firm, Glens Falls (Thomas G. Clements of counsel), forappellants.
Niles Piller & Bracy, PLLC, Plattsburgh (John M. Crotty of counsel), forrespondent.
Rose, J. Appeal from an order of the Supreme Court (Muller, J.), entered January 7,2014 in Clinton County, which, among other things, granted plaintiff's motion forsummary judgment.
Plaintiff is a not-for-profit corporation formed in 1988 to provide services for thebenefit of the residents of a townhouse development on Lake Champlain in the Town ofPlattsburgh, Clinton County. The owners of the townhouses pay membership dues toplaintiff to cover the cost of these services. Although defendants have owned one of thetownhouses since 1999, they refused to pay any membership dues after personal disputesarose between them and their neighbors. Plaintiff obtained an order requiring defendantsto pay the monthly dues and we affirmed, concluding that, upon their purchase of thetownhouse, defendants had entered into an implied contract to pay membership dues toplaintiff as a condition of ownership (see Perkins v Kapsokefalos, 57 AD3d 1189, 1191-1192[2008], lv denied 12 NY3d 705 [2009]). Plaintiff thereafter obtained a judgmentagainst defendants for $7,101 reflecting dues owed and interest from October 2002through July 2007.
Although defendants paid the judgment, they nonetheless continued to refuse to paymembership dues and, in 2012, plaintiff commenced this action seeking to recover theoutstanding amounts due since August 2007. In their counterclaim, defendants alleged,among other things, that plaintiff had not properly authorized the fees imposed and theservices provided were not reasonable or necessary. Plaintiff moved for summaryjudgment granting their claim for payment of the outstanding dues and dismissing thecounterclaims. Defendants cross-moved seeking to dismiss the complaint or, in thealternative, compel discovery. Supreme Court granted [*2]plaintiff's motion and dismissed the cross motion in itsentirety. Defendants appeal.
The issue of whether defendants are obligated to pay pursuant to an implied contractwas previously litigated in the prior action and decided in plaintiff's favor (seePerkins v Kapsokefalos, 57 AD3d at 1192). The doctrine of res judicata thusprecludes defendants from claiming that clear and convincing proof of an impliedcontract is again required in order for them to be obligated to pay plaintiff's monthly dues(see Matter of Hunter, 4NY3d 260, 269-270 [2005]; O'Brien v City of Syracuse, 54 NY2d 353, 357[1981]; Tovar v Tesoros Prop.Mgt., LLC, 119 AD3d 1127, 1128-1129 [2014]). Moreover, to the extent thatdefendants challenge the authority of plaintiff to impose those dues as never having beenestablished, such a claim could have been raised in the prior action and, therefore, it islikewise barred by res judicata (see O'Brien v City of Syracuse, 54 NY2d at357-358; Tovar v Tesoros Prop. Mgt., LLC, 119 AD3d at 1129; Matter of Feldman v Planning Bd.of the Town of Rochester, 99 AD3d 1161, 1162-1163 [2012]).
Notwithstanding defendants' request that we impose a new standard for determiningwhether they should be required to pay for services that have been undertaken byplaintiff since the prior judgment and that they do not deem to be reasonably necessaryfor their use of their property, the Court of Appeals has made clear that an impliedcontract for a community homeowners' association "includes the obligation to pay aproportionate share of the full cost of maintaining . . . facilities and services,not merely the reasonable value of those actually used by any particular resident"(Seaview Assn. of Fire Is. v Williams, 69 NY2d 987, 989 [1987]; see Nevel vShelter Is. Hgts. Prop. Owners Corp., 204 AD2d 700, 701 [1994]). We reviewplaintiff's action in undertaking such expenditures under the business judgment rule,which, in the absence of "claims of fraud, self-dealing, unconscionability, or othermisconduct," is limited to an inquiry of "whether the action was authorized and whetherit was taken in good faith and in furtherance of the legitimate interests of thecorporation" (Matter of St.Denis v Queensbury Baybridge Homeowners Assn., Inc., 100 AD3d 1326, 1327n 2 [2012] [internal quotation marks and citation omitted]; see Matter of Levanduskyv One Fifth Ave. Apt. Corp., 75 NY2d 530, 533 [1990]).
Here, we are not persuaded by defendants' contentions that the actions taken byplaintiff since the prior judgment are either unauthorized or unnecessary. Plaintiffsupported its motion for summary judgment with an affidavit from its president and acopy of its bylaws. The president described the services provided and affirmed that themonthly fees were properly voted upon and approved, and that plaintiff's business andmeetings were conducted in conformance with its bylaws. Copies of plaintiff's financialreports were also submitted in support of the motion. Inasmuch as plaintiff supported itsmotion for summary judgment with proof that the fees were "authorized, made in goodfaith, and in furtherance of [plaintiff's] legitimate interests" (Levine v Greene, 57 AD3d627, 628 [2008]), defendants were required to come forward with proof inadmissible form "sufficient to require a trial of material questions of fact"(Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). We agree withSupreme Court that defendants failed in this regard as they offered only "mereconclusions, expressions of hope or unsubstantiated allegations" (id.; see Forest Hills Gardens Corp. vKamparosyan, 63 AD3d 879, 879 [2009]; Forest Hills Gardens Corp. v West Side Tennis Club, 23 AD3d338, 340 [2005]). Nor have defendants established that discovery should have beenordered, as they merely speculated that discovery would yield relevant evidence (see Jacobs v Mazzei, 112AD3d 1115, 1118 [2013], lv dismissed 22 NY3d 1172 [2014]; Saratoga Assoc. LandscapeArchitects, Architects, Engrs. & Planners, P.C. v Lauter Dev. Group, 77 AD3d1219, 1222 [2010]).
The parties agree, however, that Supreme Court improperly calculated the interestowed [*3]on the outstanding dues when it issued thejudgment.[FN*]CPLR 5001 (b) provides that, where "damages were incurred at various times, interestshall be computed upon each item from the date it was incurred or upon all of thedamages from a single reasonable intermediate date." Adopting an intermediate date ofOctober 1, 2010 and applying the statutory interest rate of 9% results in interest of $531per year, or $1.45479 per day. Based on the award of $5,900 and the 1,193 days betweenOctober 1, 2010 and January 6, 2014, the date of the final order, the resulting interest is$1,735.56 and the judgment should be modified accordingly. Defendants' remainingcontentions have been considered and determined to be without merit.
Peters, P.J., Garry and Devine, JJ., concur. Ordered that the order is affirmed, withcosts. Ordered that the judgment is modified, on the law, by computing interest on thedamages awarded from October 1, 2010 in accordance with this Court's decision, and, asso modified, affirmed.
Footnote *:Defendants appealedfrom Supreme Court's final order, but not the subsequently entered final judgment.Inasmuch as the final judgment does not materially deviate from the final order, we deemthe appeal as also being taken from the judgment (see CPLR 5520 [c]; Miller v Moore, 68 AD3d1325, 1326 n [2009]).