Respondent moves to vacate the February 1, 2010 judgment granted on default by the court. As is set forth below, respondent's motion is granted as follows:

Respondent alleges that in late 2009 due to the serious down turn in the economy he approached the landlord seeking to adjust the space that he was renting in exchange for a rent reduction. At that time, respondent was renting all 3 (three) floors of the commercial premises located at 1672 and 1674 Hylan Boulevard, Staten Island, New York.

It appeared that the discussions of both parties was reaching an acceptable resolution. To facilitate the sound resolution of the matter, both sides engaged counsel to complete the process. [*2]It appeared to the respondent that the attorneys herein completed the negotiations and had an oral agreement where petitioner would accept respondent's surrender of the basement and top floor of 1672 Hylan Boulevard in exchange for a rent reduction from $10,000.00 per month to $8,200.00. Respondent acted in reliance of this purported oral agreement. An agreement was drafted but never executed.

Subsequently, a notice of petition and petition dated November 4, 2009, was served by the landlord on to the tenant. The rent demand sought arrears at the old unmodified monthly rate plus some additional taxes. The parties both represented by counsel began the negotiation process and agreed to extend time to answer the petition to December 11, 2009.

The negotiations fell apart. The crux of the dispute in the landlord tenant proceeding pertained to arrears due on back taxes and other charges. The respondent alleges that the attorneys in the landlord tenant proceeding reached an oral agreement that both he and the petitioner accepted. However, that agreement was never put in writing.

According to the terms of this oral agreement, respondent voluntarily agreed to vacate by December 31, 2009. The court notes that at oral argument respondent disclosed and petitioner did not deny that the parties herein had at least on one other concurrent landlord tenant proceeding resolved their differences through an oral agreement. The parties did not deny that petitioner honored his end of that oral agreement. What amazed the respondent was the great new unexplained dramatic departure of the petitioner from his past course of dealings. The respondent wondered why all of a sudden was the petitioner questioning their oral agreements.

Respondent alleges that he did not hear from petitioner or his attorney from the date of his vacating the commercial premises until he received a call on April 2, 2010 from Victory State Bank that there is a restraining notice on his bank account for double the default judgment amount.

LEGAL STANDARD TO VACATE A DEFAULT JUDGMENT

It is well settled that the quantum of proof required to prevail [on a motion to vacate a default order or judgment] is not as great as is required to oppose summary judgment [see, Bailed v Preferred Mutual Insurance Co., 38 AD3d 1277 [App Div, 3rd Dept, 2007]; (Clark v. M.M. Textiles Indus., 307 AD2d 520, 521 [App Div, 3rd Dept, 2003]; Wincey v County of Saratoga, 252 AD2d 882, 884 [App Div, 3rd Dept, 1998]; Goodwill v Middle burgh Little, 213 AD2d 843, 844 [App Div, 3rd Dept, 1995].)

Nevertheless, in pursuant to CLR §5015 [a][1] a motion to vacate a default judgment is addressed to the court's discretion. Typically courts have required a party moving to vacate a default judgment to demonstrate both a reasonable excuse for the default and the existence of a prima facie showing of a meritorious claim or defense (see, Eugene Di Lorenzo, Inc v A.C. Dutton Lar. Co., 67 NY2d 138, 141 [1986]; NYCTL 2005-A Trust v 2137-2153 Nostrand Ave. Assoc., 69 AD3d 697, [App Div, 2nd Dept, 2010]; Rodgers v 66 East Treamont Heights Hou. Develop. Fund Corp., 69 AD3d 510 [App Div 1st Dept, 2010]; Denzler v Larubio Properties, LLC, et al., 20 Misc 3d 1104(A) [Sup Ct, Richmond County, 2008].)

A defendant is not required to establish its defense as a matter of law; it need only set forth sufficient facts to make out a prima facie showing of a meritorious defense (see, Quis v [*3]Bolden, 298 AD2d 375, [App Div, 2nd Dept, 2002]; Energy Sav. Products v Milici, 168 AD2d 415 [App Div, 2nd Dept, 1990] Bergen v 791 Park Ave. corp., 162 AD2d 330 [App Div, 1st Dept, 1990]; Tat Sang Kwong v Budge-Wood Laundry Service, 97 AD2d 691, 692 [App Div, 2nd Dept, 1983].)

Finally, what constitutes a reasonable excuse for a default lies within the sound discretion of the trial court (see, Martinez v D'alessandro Custom Buildrs & Demolition, Inc., 52 AD3d 786, 787 [App Div, 2nd Dept, 2008]; Matter of Gambardella v Ortov Lighting, Inc., 278 AD2d 494, 495 [App Div, 2nd Dept, 2000]; Parker v City of New York 272 AD2d 310, 311 [App Div, 2nd Dept, 2000]; Roussodimou v Zafiriadis, 238 AD2d 568, 569 [App Div, 2nd Dept, 1997].)

It is long settled under New York's Statute of Frauds that an oral agreement to convey an estate or interest in real property, other than a lease for a term not exceeding one year, is "nugatory and unenforceable and "[a] party to the agreement may legally and rightfully refuse to recognize or perform it (Woolley v. Stewart, 222 NY 347, 350-351 [1918]; General Obligations Law § 5-703].)

A party may, however, lose the benefit of the defense of the Statute of Frauds, "or waive its protection, by inducing or permitting without remonstrance another party to the agreement to do acts, pursuant to and in reliance upon the agreement, to such an extent and so substantial in quality as to irremediably alter [the] situation and make the interposition of the statute against performance a fraud" id., Woolley at 351).

Codified in New York's General Obligations Law, section 5-703(4), the doctrine of part performance is based on principles of equity, and, specifically, recognition of the fact that it would be a fraud to allow one party to a real estate transaction to escape performance after permitting the other party to perform in reliance on the agreement Walter v. Hoffman, 267 NY 365 [1935]; McKinley v. Hessen, 202 NY 24 [1911]; rehg. denied 202 NY 587 [1911].) Part performance alone, of course, is not sufficient. The performance must be unequivocally referable to the agreement Burns v. McCormick, 233 NY 230, 232 [1922]; Woolley v. Stewart, 222 NY, supra, at 351).

General Obligations Law § 5-703(4) provides: "Nothing contained in this section abridges the powers of courts of equity to compel the specific performance of agreements in cases of part performance Although application of the part performance doctrine has traditionally been grounded on affirmative acts of the party aggrieved, in concept part performance in the form of inaction might also suffice. The doctrine, whose roots lie in equity to prevent injustice by fraud, is invoked as an equitable remedy by the party aggrieved and applied by courts of equity in the determination of what justice and fairness require. As a hallmark of equity, the doctrine remains malleable to address a myriad of facts and circumstances.

To qualify as part performance, inaction-like affirmative acts-would have to be pleaded as a term of the oral agreement, alleged to be "unequivocally referable to the oral agreement and coupled with an element of detrimental reliance. There would otherwise be "nothing to show that the plaintiff changed his position to his prejudice because of the contract so as to give rise to an estoppel" (Gross v. Vogel, 81 AD2d, 576, 577 [App Div, 2nd Dept, 1981]; citing Walter v. Hoffman, 267 NY 365, 1, supra; see, 4 Corbin on Contracts § 18.6, at 512 [rev. ed. 1997]["The performance must be in pursuance of the contract and in reasonable reliance thereon, without notice that the [*4]defendant has already repudiated the contact] ). Only then could the pleading have the potential to establish the type of "unjust and unconscientious loss and injury that is required in the summoning of equitable relief Woolley v. Stewart, 222 NY, supra, at 353,; see, Walter v. Hoffman, 267 NY, supra, at 369-370).

In essence, the statute of frauds prohibits the conveyance of real property without a written contract (see General Obligations Law § 5-703 [1]). While the statute of frauds empowers courts of equity to compel specific performance of agreements in cases of part performance (see General Obligations Law § 5-703 [4]), the claimed partial performance must be unequivocally referable to the agreement (Messner Vetere Berger McNamee Schmetterer Euro RSCG v Aegis Group, 93 NY2d 229, 235 [1999]; Luft v Luft, 52 AD3d 479, 481 [2008]).

It is not sufficient that the oral agreement gives significance to the plaintiff's actions. Rather, the actions alone must be unintelligible or at least extraordinary, [and] explainable only with reference to the oral agreement (Anostario v Vicinanzo, 59 NY2d 662, 664 [1983], quoting Burns v McCormick, 233 NY 230, 232, supra; see Adelman v Rackis, 212 AD2d 559, 561 [1995]). Significantly, the doctrine of part performance is based on principles of equity, in particular, recognition of the fact that the purpose of the Statute of Frauds is to prevent frauds, not to enable a party to perpetrate a fraud by using the statute as a sword rather than a shield (Nicolaides v Nicolaides, 173 AD2d 448, 449-450 [App Div, 2nd Dept, 1991]; see Scutti Enters. v Wackerman Guchone Custom Bldrs., 153 AD2d 83, 87 [App Div, 4th Dept, 1989]).

This case echoes as Judge Cardozo warned, "The peril of perjury and error is latent in the spoken promise" (Burns v. McCormick, 233 NY 230, 234, supra).

Here, the respondent has presented both a reasonable excuse for not appearing on February 1, 2010, and a meritorious defense to this instant proceeding. Respondent honestly believed that he was able to vacate the subject premises without any legal consequence or repercussions. Respondent genuinely believed that he had an unequivocal oral agreement that he relied upon to his detriment. Respondent alleges and the petitioner did not deny that they had a history of entering into and abiding by these oral gentlemen agreements, and that based on their course of conduct respondent alleges that he believed that they once again had entered into such an oral agreement.

According to the terms of this oral agreement petitioner permitted respondent to vacate from the premises without incurring any further lease obligations. Respondent alleges that subsequent to his departure the petitioner padlocked the commercial premises. Respondent avers that petitioner's physical act of padlocking not only is an exercise of dominion and control as the owner who has recovered possession of the commercial premises; but it also symbolized petitioner's acceptance of the oral agreement permitting respondent to vacate without any further legal consequences. Otherwise, petitioner would have been required to follow the legal process of first obtaining a judgment and a warrant of eviction. The use of self help by the petitioner appears to create a serious material issue of fact and gives the appearance that petitioner acquiesced and ratified an oral agreement. Respondent has satisfied the first prong of demonstrating a reasonable excuse for failing to appear.

Respondent also has a meritorious defense to this within proceeding. Respondent alleges that prior to the commencement of this summary proceeding he vacated the basement in exchange for [*5]a lower rent. The act of respondent's relying on the alleged oral contract negotiated by counsel creates an issue of fact whether there was performance or partial performance on an oral contract between the parties that would remove said unwritten agreement from the requirements of the statute of frauds.

Thus, in the interest of justice, the court limits the restraining notice to the default judgment amount of $20,529.00, and directs Victory State Bank to release to respondent any monies in excess to the judgment amount. At the same time, Victory State Bank is not to release to either side any monies held until further notice/order from this court

Accordingly, this matter is adjourned for all purposes to May 19, 2010, Part 52 at 11 AM.

This constitutes the decision and order of the court.

Dated: May 5, 2010

Staten Island, New York

________________

Orlando Marrazzo, Jr.,

Civil Court Judge