WILLETT v. LINCOLNSHIRE MANAGEMENT INC (2003)

Order, Supreme Court, New York County (Herman Cahn, J.), entered July 10, 2001, which, to the extent appealed from, granted plaintiff's motion for summary judgment on his conversion cause of action and dismissed defendants' first, third, sixth and seventh affirmative defenses, and judgment, same court and Justice, entered April 23, 2002, which awarded plaintiff $881,037 plus interest, unanimously affirmed, with one bill of costs.

 The IAS court properly granted plaintiff summary judgment on his conversion claim against defendant Lincolnshire Management, Inc. (LMI).  It is undisputed that LMI, in its role of managing agent of defendant Lincolnshire Equity Fund, L.P. (The Fund), withheld substantial distributions owed to plaintiff by The Fund. LMI's affirmative defense, that it properly withheld the distributions due plaintiff to offset a substantial obligation owed from plaintiff to LMI, was properly dismissed.   The obligation purportedly owing from plaintiff to LMI is currently being disputed and “there is no right to set off a possible, unliquidated liability against a liquidated claim that is due and payable” (Spodek v. Park Prop. Dev. Assocs., 263 A.D.2d 478, 478-479, 693 N.Y.S.2d 199;  see also New Haven Props. Ltd. v. Grinberg, 293 A.D.2d 386, 741 N.Y.S.2d 206).   The IAS court also properly dismissed the affirmative defenses that LMI's actions were justified in the interests of equity and that plaintiff's conversion claim was barred by the doctrines of estoppel and unclean hands since there was no evidence of wrongdoing by plaintiff.

We have considered defendants' remaining contentions and find them unavailing.