HARLEM SUITES LLC v. 231 NORMAN AVE LLC

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HARLEM SUITES, LLC, Index., Plaintiff–Respondent, v. 231 NORMAN AVE., LLC, et al., Defendants–Appellants.

Decided: October 18, 2011

MAZZARELLI, J.P., MOSKOWITZ, ACOSTA, RENWICK, DeGRASSE, JJ. Law Offices of Annette G. Hasapidis, South Salem (Annette G. Hasapidis of counsel), for appellants. Cole, Schotz, Meisel, Forman & Leonard, P.A., New York (Jed M. Weiss of counsel), for respondent.

Order, Supreme Court, New York County (Joan A. Madden, J.), entered July 16, 2010, which, insofar as appealed from as limited by the briefs, granted plaintiff's cross motion for summary judgment, unanimously modified, on the law, to deny summary judgment as against defendant DCI USA, Inc. (DCIU), and otherwise affirmed, without costs.

All defendants except DCIU guaranteed that plaintiff would be repaid $1,750,000 plus interest no later than March 4, 2009. Their argument that two agreements entered into in September 2007 (the Refinancing Agreements) constituted a novation of the 2005 operating agreement, construction agreement, and guaranty (the Original Agreements) is without merit (see Water St. Dev. Corp. v. City of New York, 220 A.D.2d 289, 290 [1995], lv denied 88 N.Y.2d 809 [1996] ). Far from expressing an intent to supersede the Original Agreements, one of the Refinancing Agreements states, “[A]ll of the obligations and guarantees currently existing between the parties undersigned shall continue after the refinance with North Fork Bank per the terms of the operative agreements ․ Specifically, the guarantee of [plaintiff's] equity investment and the indemnifications for the loans remain in place per the Construction Agreement and the Personal Guarantees.”

Defendants' argument that there was an oral agreement to relieve them of their guarantees is also unavailing. The supposed partial performance was not “unequivocally referable to the modification” (Rose v. Spa Realty Assoc., 42 N.Y.2d 338, 341 [1977] ), and the conduct relied upon to establish estoppel was compatible with the Original Agreements (id. at 344).

Defendants' reliance on the original complaint is misplaced, since the amended complaint superseded the original complaint (see Thompson v. Cooper, 24 AD3d 203, 205 [2005] ). In any event, the original complaint said nothing about extinguishing defendants' guarantees.

Since there is no evidence in the record that DCIU gave a guarantee, and since plaintiff neither requested summary judgment against it nor explained why it was liable, we deny summary judgment as against DCIU.