CITY OF NEW YORK v. BUILDING COMPANY

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Supreme Court, Appellate Division, First Department, New York.

The CITY OF NEW YORK, Plaintiff-Appellant, v. P.A. BUILDING COMPANY, Defendant-Respondent.

Decided: November 15, 2005

SAXE, J.P., MARLOW, NARDELLI, GONZALEZ, SWEENY, JJ. Michael A. Cardozo, Corporation Counsel, New York (Alan H. Kleinman of counsel), for appellant. Victor & Bernstein, P.C., New York (Donald M. Bernstein of counsel), for respondent.

Judgment, Supreme Court, New York County (Faviola A. Soto, J.), entered July 15, 2004, after a nonjury trial, dismissing the complaint and awarding defendant the total amount of $69,689.24 on its counterclaim, unanimously affirmed, without costs.

 It was plaintiff City's burden to establish, in accordance with its allegations, that defendant landlord had breached the parties' lease by improperly making capital replacement expenditures, when repair would have been sufficient, and then passing a portion of those expenditures to the City pursuant to the lease's escalation clauses.   According the City every favorable inference, we are nonetheless unable to conclude that the trial court was in error when it found that the City had not set forth a prima facie case, and dismissed the complaint pursuant to CPLR 4401 (see Szczerbiak v. Pilat, 90 N.Y.2d 553, 556, 664 N.Y.S.2d 252, 686 N.E.2d 1346 [1997] ).   Although the City complains that defendant did not provide the requisite documentation during the audit process, the burden remained with the City at trial to demonstrate that the expenditures were improper.   If it needed the documentation to establish its case, it should have availed itself of appropriate discovery devices.   While there is some merit to the City's contention that the trial court was unduly restrictive in sustaining objections to testimony offered by the City as to conditions observed by the witnesses, any error in this regard was harmless when viewed in the context of the entire record.