Medical Buildings Associates, Inc. v. Abner Properties Co.

Order, Supreme Court, New York County (Paul Wooten, J.), entered August 3, 2012, which, to the extent appealed from as limited by the briefs, directed plaintiff-tenant to file an undertaking equal to three months rent as a condition to granting the tenant’s order to show cause for a Yellowstone injunction, unanimously modified, on the law, the facts and in the exercise of discretion, to reduce the undertaking to one month’s rent, and otherwise affirmed, without costs. The undertaking in the amount of three months rent was “excessive” given the inadequate proof and otherwise speculative arguments offered by the landlord as to potential damages (see generally Visual Equities v Sotheby’s, Inc., 199 AD2d 59 [1st Dept 1993]; Access Med. Group, P.C. v Straus Family Capital Group, LLC, 44 AD3d 975 [2d Dept 2007]). Not only do factual issues exist as to which party was at fault for the delays in curing the claimed violations, but the record shows the tenant has expended considerable sums of money which have added appreciable value to the premises (see generally Kuo Po Trading Co. v Tsung Tsin Assn., 273 AD2d 111 [1st Dept 2000]; WPA/ Partners v Port Imperial Ferry Corp., 307 AD2d 234 [1st Dept 2003]). Nonetheless, one month’s rent would reflect an appropriate undertaking, as it would be rationally related to the potential damages in the event the injunction is found to have been unwarranted (see 3636 Greystone Owners v Greystone Bldg., 4 AD3d 122 [1st Dept 2004]; Ithilien Realty Corp. v 180 489 Ludlow Dev. LLC, 80 AD3d 455 [1st Dept 2011]) inasmuch as the tenant acknowledged a potential cost of $20,000 to cure, that almost one year has transpired since the notice to cure was served, and the building remains subject to potential violations. The tenant’s demand for a hearing on the undertaking issue is unavailing as the record affords an adequate basis to determine an appropriate undertaking. Concur—Mazzarelli, J.P., Acosta, Freedman, Richter and Gische, JJ.