Motions bearing the sequence numbers 026, 027, 028 and 029 are hereby consolidated for decision.

Plaintiff Estelle A. Carr (Carr) moves for summary judgment as to the ownership interests in a building at 45-47 Second Avenue, New York County (the Building) (mot. seq. 026). The estates of Royce K. Hoffman, plaintiff (Hoffman),^[FN1] and John Gene Mangerino (JG Mangerino), non-party (together as Hoffman-Mangerino), move for summary judgment as to the ownership interests in the Building, and a money judgment against defendants Rose A. Caputo (Caputo) and Lil E. Dominguez (Dominguez) (mot. seq. 027). Defendant Henry Alpizar (Alpizar) moves for summary judgment as to the ownership interests in the Building (mot. seq. 028). Caputo and Dominguez (together as Caputo-Dominguez) move for leave to amend their answer to the amended complaint (mot. seq. 029). They also move for summary judgment as to the ownership interests in the Building. Caputo-Dominguez support Carr in mot. seq. 026, and oppose movants in mot. seq. 027 and 028.^[FN2]

Factual Background

On June 26, 1968, Carr, Hoffman, Caputo, Dominguez, Dan Kampel (Kampel), Frank Bradley (Bradley) and Joseph Sample (Sample) acquired title, as tenants in common, to the [*2]Building pursuant to two deeds dated June 25, 1968 and June 26, 1968 (Exhibits 1 & 2). The Building contained residential units, to be occupied by the purchasers, as well as commercial space, which has been leased to businesses over the years. The deeds provided for the following undivided interests:

Carr1/6

Bradley and Sample, as joint tenants1/6

Kampel2/6

Hoffman1/6

Caputo and Dominguez, as joint tenants1/6

On June 26, 1968, Kampel conveyed one-half of his interest, that is, 1/6 of the Building, to Charles Caspar (Caspar) and Keith Whitten (Whitten), as joint tenants. On May 1, 1969, all of the individuals involved entered into an agreement (1969 Agreement) (Exhibit 3), which stated that the parties "entered into the . . . venture as partners for the primary and sole purpose of having a permanent place of residence." The Building was not, however, conveyed to the partnership. The 1969 Agreement stated the interests in the Building as follows:

Carr1/6

Bradley1/12

Sample1/12

Caspar1/12

Whitten1/12

Kampel1/6

Hoffman1/6

Caputo1/12

Dominguez1/12

It also provided that the partnership has a 30-day right of first refusal on any sale of a partner's interest, and, upon rejection of the offer by the partnership, the individual partners had to be offered the sale before an outside party could purchase the interest. 1969 Agreement, ¶¶ 10-12. The sale of an interest to the partnership or another partner shall be made at "book value." Id. The "death, retirement or insanity" of any partner terminated the interest of the partner, but did not terminate the partnership. Id., ¶ 14. The value of a terminated interest, to be paid to the appropriate partner or representative, "shall be determined by the surviving parties." Id. The 1969 Agreement has no provision to dissolve the partnership, nor does it limit the duration of the partnership.

On November 20, 1975, all the partners except Caputo and Dominguez executed a "Resolution and Dissolution with Statement of Accounting," purporting to end the partnership (Exhibit 15). On November 5, 1976, the same group executed an "Enabling Declaration Establishing a Plan for Condominium Ownership" (Exhibit 24) and a "Plan of Apartment Ownership-Master Deed" (Exhibit 25) (the three together as Dissolution and Conversion documents). In conjunction with the condominium conversion plan, the participants also executed deeds transferring their interests appropriately. Caputo and Dominguez never signed any of the Dissolution and Conversion documents. On January 20, 1979, Caspar and Whitten executed a deed assigning their interests in the Building to Carr for $25,000. [*3]

Prior to 1980, Sample apparently left the Building and never returned to live there,^[FN3] but participated in litigation concerning the Building subsequently. Before he died, Sample sold his 1/12 interest to Caputo and Dominguez together in 2004. In August 1984, Bradley died, leaving his apartment to JG Mangerino, who lived there until his own death in October 1999. Philip Mangerino (P Mangerino), JG Mangerino's brother, eventually became the representative of his estate and Bradley's interest in the building. In 1991, Kampel died, leaving his apartment to Alpizar. Hoffman died in 2001 and left his 1/6 interest to Carr, who, in turn, assigned half of that interest (1/12) to Caputo and Dominguez together by a deed dated November 2, 2006.

The instant action commenced in 1997 in an attempt to clear title to the Building. The amended complaint (Exhibit A-1) asserted causes of action for (1) a declaratory judgment on the ownership interests in the Building, (2) a declaratory judgment that the parties are the fee simple absolute owners of their respective apartments and together own an undivided interest in the common elements of the Building, (3) breach of the 1969 Agreement against Caputo and Dominguez for failure to enter into the "Plan of Apartment Ownership-Master Deed," and (4) failure to pay the proper share of the Building's expenses for at least five years against Caputo and Dominguez.

On January 10, 2002, the Honorable Sheila Abdus-Salaam addressed several motions and cross motions brought by various parties (Exhibit B). The court found, among other things, that the parties had formed a partnership pursuant to the 1969 Agreement, the partnership had not been terminated and the Building had not been converted into a condominium. The court acknowledged that some of the partners intended to dissolve the partnership by executing the Dissolution and Conversion documents. However, the tax returns filed by all parties at least until 1999, and the conduct of the Building's affairs, failed to demonstrate that the parties actually dissolved the partnership. Nor were there any indications that there was any "winding up" of the partnership's affairs pursuant to Partnership Law § 61 ("On dissolution the partnership is not terminated, but continues until the winding up of partnership affairs is completed"). Since the partnership had no duration or provision for dissolution, Justice Abdus-Salaam found that it was an "at-will" partnership. The court denied parts of the motion sequence that requested a declaratory judgment on the ownership interests in the Building of the parties, that is, the fractional distribution of the interests. The court also found that Carr's 1979 purchase of Caspar and Whitten's interest (and apartment) was valid under the 1969 Agreement, as was Alpizar's inheritance of Kampel's interest. Laches was a factor in each of these latter two determinations. Finally, the court dismissed the amended complaint's second cause of action for a declaratory judgment on ownership status and the third cause of action for breach of the 1969 Agreement against Caputo and Dominguez, but denied summary judgment on the fourth cause of action for a money judgment against Caputo and Dominguez.

Carr's Summary Judgment Motion Mot. Seq. 026

"The proponent of a motion for summary judgment must demonstrate that there are no material issues of fact in dispute, and that it is entitled to judgment as a matter of law." Dallas-Stephenson v Waisman, 39 AD3d 303, 306 (1st Dept 2007), citing Winegrad v New York Univ. Med. Center, 64 NY2d 851, 853 (1985). Upon proffer of evidence establishing a prima [*4]facie case by the movant, "the party opposing a motion for summary judgment bears the burden of produc[ing] evidentiary proof in admissible form sufficient to require a trial of material questions of fact.'" People v Grasso, 50 AD3d 535, 545 (1st Dept 2008), quoting Zuckerman v City of New York, 49 NY2d 557, 562 (1980). If there is any doubt as to the existence of a triable issue of fact, summary judgment must be denied. Rotuba Extruders v Ceppos, 46 NY2d 223, 231 (1978); Grossman v Amalgamated Hous. Corp., 298 AD2d 224 (1st Dept 2002).

Carr's motion claims the interests in the Building to be as follows: Carr, 5/12 consisting of her original 1/6, the purchase of the 1/12 Casper and 1/12 Whitten interests, and the inheritance of the 1/12 Hoffman interest; Caputo and Dominguez, as joint tenants, 4/12 consisting of their original 1/6, the purchase of the 1/12 Sample interest, and the assignment of half the 1/6 Hoffman interest. Carr maintains that the 1/12 Bradley interest and the 1/6 Kampel interest now belong to the partnership by the terms of the 1969 Agreement, and that their respective estates, represented by P Mangerino and Alpizar, are only entitled to book value of the partner's interest at the time of the partner's death.

Justice Abdus-Salaam settled the issue of Alpizar's interest in 2002 when she ruled that "Alpizar has succeeded to Kampel's rights under the 1969 Agreement and under the 1968 deed." Carr tries to limit the extent of this ruling by emphasizing what the court went on to say in denying another part of Alpizar's motion: "The remainder of Alpizar's interests may be determined when the partnership's accounting has been completed." Carr, claiming that Alpizar is only entitled to the book value of Kampel's interest at the time of Kampel's death, ignores the plain meaning of the court's ruling that "Alpizar" now equals "Kampel." The "remainder" spoken of in the decision deals with whether the original owners were partners or tenants in common and would implicate all owners, not Kampel/Alpizar alone. The decision does not limit or restrict Alpizar's interest in any manner that is unique to Alpizar. As a result of the court decision of January 10, 2002, Alpizar has the 1/6 interest originally belonging to Kampel. Carr's motion is denied to the extent that it proposes any alternative to Justice Abdus-Salaam's ruling on Alpizar's interest.^[FN4]

Carr also moved before Justice Abdus-Salaam that the estate of JG Mangerino be declared the owner of 1/6 interest in the Building, corresponding to its third floor. The court denied this application because of disputed issues of fact. The court also denied summary judgment as to the specific interests of other parties on particular issues of fact.

Carr, in the instant motion, argues that the estate of JG Mangerino is only entitled to the book value of a 1/12 interest, inherited from Bradley, quite a different position than her position in 2001, when she was joined by Hoffman, who was still alive, and the estate of JG Mangerino.^[FN5] She accepts the court's 2002 ruling on the continuity of the partnership under the 1969 Agreement, but maintains that paragraph 14 limits the sale of Bradley's interest to book value at his death, and that the interest reverted to the partnership then. Caputo-Dominguez, in support of Carr's motion, go further, and contend that Sample was Bradley's survivor under their joint tenancy and, therefore, P Mangerino had no right to assert any claims, not even for a 1/12 interest [*5]at book value.

Hoffman-Mangerino argue that none of the original parties have complied with the terms of the 1969 Agreement for over 30 years, and that the partnership has been long terminated. Additionally, they contend that Carr's inheritance of the Hoffman interest is directly contrary to the theory that she propounds against P Mangerino and Alpizar, as the 1979 assignment of their interests to Carr by Caspar and Whitten might also have been. Below is a fuller examination of their position, along with a decision on their motion and Carr's motion in regard to the Bradley interest.

Hoffman-Mangerino's Summary Judgment Motion Mot. Seq. 027

Hoffman-Mangerino assert that the ownership interests in the Building are as follows: Carr, 10/24; Caputo, 3/24; Dominguez, 3/24; Alpizar, 1/6; JG Mangerino estate, 1/6. This differs from Carr's view, in that the Sample and Bradley interests, along with the right of occupancy of the third-floor apartment, both belong to the JG Mangerino estate, and the Kampel interest, along with the right of occupancy of the fourth-floor apartment, belong to Alpizar.

The estate of JG Mangerino argued before Justice Abdus-Salaam that Bradley and Sample's original joint tenancy was converted to a tenancy in common by execution of a 1975 deed in conjunction with the condominium conversion attempt. Thus, Bradley's interest as a tenant in common passed to JG Mangerino through Bradley's will in 1984. The estate alternately contended that JG Mangerino took adverse possession of the apartment in 1977, when Sample allegedly moved out. Sample, still alive at the time of the motion practice, disputed the effect of the 1975 deed, because the condominium conversion effort failed, and asked that he be declared owner of a 1/6 interest in the Building under the joint tenancy provision of the 1968 deeds. Sample also denied that JG Mangerino's occupancy of the apartment was adverse to his ownership interest.

The court denied summary judgment on determining JG Mangerino's interest in 2002, because "it is not clear that this [1975] deed operated to convert Sample's relationship with Bradley from a joint tenancy to a tenancy in common." Justice Abdus-Salaam noted that the 1968 deed stated that Bradley and Sample have a joint tenancy of a 1/6 interest in the Building, while the 1969 Agreement provided each of the two men with a 1/12 interest in the partnership. Additionally, Sample continued to file a partnership tax return from the Building, at least through 1999, refuting the adverse possession claim.

Hoffman-Mangerino claim that Justice Adbus-Salaam left open the question as to whether the 1969 Agreement was presently enforceable, because of disputed issues of fact. The court decided, however, that the 1969 Agreement established a partnership-at-will, because of the absence of a duration and provision for dissolution, citing Sanley Co. v Louis (197 AD2d 412, 413 [1st Dept 1993] ["No term of duration was set by the partners with respect to either partnership. The partnerships were therefore partnerships at will subject to dissolution at any time by any partner"]. The court recognized that most of the partners took steps toward dissolution in 1975 and 1976, but the lack of winding up of partnership affairs, along with their tax reporting and other conduct, maintained the existence of the partnership. In other words, the Dissolution and Conversion documents do not in themselves inhibit the enforcement of the 1969 Agreement.

Another document is central to the dispute over the Bradley-Sample interest, the deed [*6]executed by Bradley and Sample in 1975, as part of the condominium conversion effort, which identified them as tenants in common (Exhibit 21). Until then, under the 1968 deeds, they were joint tenants. Given that Bradley pre-deceased Sample, Sample made the argument in 2001, repeated now by Caputo-Dominguez and, in part, by Carr, that Bradley's interest never left the partnership, because the 1975 deed never took effect. However, the 1975 deed makes no mention of any contingency or other document except the June 25, 1968 mortgage on the Building. The fact that unspoken, anticipated events did not occur is insufficient reason to ignore or invalidate this agreement. Cole v Macklowe, 40 AD3d 396, 396 (1st Dept 2007) ("The parol evidence rule bars admission of extrinsic evidence to contradict or vary the terms of a written contract intended to embody the agreement between the parties").

For other reasons, the 1975 deed is unenforceable in its attempt to convey the Building's third-floor apartment to Bradley and Sample as tenants in common. The deed is executed by Carr, Bradley, Sample, Caspar, Whitten, Kampel and Hoffman, "all residing at 45-47 Second Avenue, New York City." It is missing the expressed consent of Caputo and Dominguez, as were the Dissolution and Conversion documents. Nothing in the 1968 deeds or the 1969 Agreement permits any subset of the entire group of owners or partners to effect any change in the structure of ownership or partnership. The people executing the 1975 deed do not identify themselves as either owners or partners. They have no right to change the relationship between Bradley and Sample as originally expressed in the 1968 deeds.

The relationship between Bradley and Sample was changed decisively by the 1969 Agreement. All signatories to the 1968 deeds executed the 1969 Agreement "as partners for the primary and sole purpose of having a permanent place of residence." It appears to have been the last time all the signatories acted unanimously on a significant issue, stating "the amounts [of funds], percentage of interest and apartments occupied by each [party]." The percentages were actually given as fractions and 1/12 interests were each assigned to Bradley and Sample, without qualification as joint tenants, a term that does not appear anywhere in the 1969 Agreement. As the court held in 2002, the partnership has not been dissolved and remains in effect until fully wound down. Therefore, at the time of his death, in 1984, Bradley had a 1/12 interest in the Building.

The 1969 Agreement effectively returns the interest of a deceased partner to the partnership with the representative of the deceased partner receiving "book value" of the interest. Carr and Caputo-Dominguez nowhere suggest that Hoffman's interest should have been handled in this manner in 2001, when Carr inherited Hoffman's interest and proceeded to transfer one-half of it to Caputo and Dominguez. Similarly, the sale of Sample's interest to Caputo-Dominguez might not survive such strict scrutiny. In the case of Alpizar, the court rejected this restrictive approach in 2002 by ruling that Alpizar has succeeded to Kampel's rights under the 1969 Agreement and under the 1968 deeds by the working of Kampel's will in 1991. Significantly, the court found that the statute of limitations for breach of the 1969 agreement had elapsed, and the doctrine of laches prohibited assertion of the claim, "[e]ven assuming that Kampel's actions violated the 1969 Agreement." Now, eight years later, it is appropriate to follow the same logic when reviewing the passage of Bradley's interest to JC Mangerino in 1984. The estate of JC Mangerino has succeeded to Bradley's interest in the Building under the 1969 Agreement and the 1968 deeds. Carr's motion to declare otherwise is denied (mot. seq. 026); Hoffman-Mangerino's [*7]motion for summary judgment in regard to the Bradley interest is granted, that is a 1/12 interest (mot. seq. 027).

Hoffman-Mangerino also move for money judgments against Caputo-Dominguez, based on the report of Special Referee Nicholas Doyle (Doyle). On March 25, 2008, this court referred the issue of a financial accounting for the Building to Doyle, who was to oversee the work of Steven Del Santo, CPA (Del Santo). Del Santo issued his report on September 26, 2008 and Doyle extended the time to file objections for several months into 2009. Counsel appeared for Carr, individually and as assignee of Caspar and Whitten, the estates of JG Mangerino and Hoffman, Caputo and Dominguez, and Alpizar, individually and as executor of the Kampel estate. Hearings were held on May 5-7, 2009.

Doyle issued his report on July 8, 2009 (Exhibit C). He made the following findings:

Del Santo's accounting was complete and a new accounting was unnecessary.

The partnership has contingent claims receivable through December 31, 2007 as against Alpizar in the amount of $100,879.31; P Mangerino $357,330.54; Carr (for Caspar-Whitten unit) $382,536.01; Hoffman estate $82,225.64; Carr (for Hoffman unit) to be determined; Caputo and Dominguez (for Hoffman unit) to be determined.

According to the court's construction of an alleged maintenance waiver, the partnership may have a claim receivable through December 31, 2007 for maintenance arrears as against Caputo and Dominguez in the amount of $561,085.01

If partnership funds were used by Caputo and Dominguez to purchase one-half the Hoffman interest, they are responsible to the partnership in the amount of $13,000 plus interest from November 2006.

On October 26, 2009, this court confirmed the finding that Del Santo's accounting was complete and that a new accounting was unnecessary (Exhibit D). All the other findings regarding amounts possibly owed to the partnership were disaffirmed and the subject reserved for the trier of fact at the time of trial. As such, the prong of Hoffman-Mangerino's motion requesting money judgments against Caputo-Dominguez is denied. This issue may have been a proper subject for appeal, or at least a motion to renew and/or reargue, but it cannot properly be addressed here and now as Hoffman-Mangerino attempt to do.

Alpizar's Summary Judgment Motion Mot. Seq. 028

Alpizar asks that he be declared the owner of 1/6 interest in the Building and in the partnership. The court's 2002 decision said as much, and Alpizar's motion is granted.

Caputo-Dominguez's Motion to Amend Mot. Seq. 029

"Permission to amend pleadings should be freely given' (CPLR 3025, subd [b])" (Edenwald Contr. Co. v City of New York, 60 NY2d 957, 959 [1983]), but "in order to conserve judicial resources, an examination of the underlying merits of the proposed causes of action is warranted" (Weinstock v Handler, 254 AD2d 165, 171 [1st Dept 1998]). "The merit of a proposed amended pleading must be sustained, however, unless the alleged insufficiency or lack [*8]of merit is clear and free from doubt." Daniels v Empire-Orr, Inc., 151 AD2d 370, 371 (1st Dept 1989).

Caputo-Dominguez ask for leave to amend their answer to the amended complaint, which they served on or about January 18, 1999. Caputo-Dominguez contend that amending their answer at this time is appropriate, because, in the 11 years since they answered the amended complaint, Hoffman died, Hoffman's interest was inherited by Carr, Carr transferred one-half of the Hoffman interest to them, Sample transferred his interest to them, the court found that the parties entered into a partnership which has not terminated, and "[m]ost importantly, Estelle Carr . . . has agreed that the partnership agreement controls and that the Decision of the Supreme Court by Judge Abdus-Salaam recognized that the partnership agreement continued to exist" up to the present." Accordingly, they want to add a counterclaim and cross claim that the partnership is not terminated or dissolved; the partnership controls the real property and the rights and claims to the interest of the partners by succession; the only parties with standing to assert claims against partners are the partnership through the surviving partners or partners admitted by unanimous consent; the partners may forgive any and all claims of the partnership against any partner; the legatees must transfer their interest to the surviving partners at book value at the date of the partner's death; and Sample's deed is a final and conclusive transfer of the 1/6 Bradley-Sample interest to Caputo-Dominguez.

However, they do not change several critical elements of their answer, notably that the statute of limitations and the doctrine of laches bar any declaratory judgment on contractual claims, and that Carr and Hoffman conspired against them. On the other hand, they fail to reference a most significant change in the litigation posture of the parties, a "Proposal for Settlement," executed by Carr, Caputo and Dominguez on February 27, 2004 (Exhibit 40). This agreement, only acknowledged by Carr's counsel on October 17, 2008, essentially eliminates the dispute between plaintiff Carr and defendants Caputo and Dominguez, yielding the "Result: A 50%-50% interest in the partnership between E.C. & R & L," that is Estelle Carr, Rose Caputo and Lil Dominguez. "In the event the interlopers do not accept the proposal — then we as a united front will go forward with the case." The fact that Carr accedes to the judgment of the court's 2002 decision seems far less consequential to these proceedings than her uniting with some of her long-term adversaries against the interlopers in 2004. This change of posture, which was not initially disclosed to the other parties, may have a profound effect on the course of this action. For instance, Carr submitted an affidavit, dated January 12, 2001, stating that "Caputo [an attorney] prepared the 1969 Agreement which we all signed. But she did not explain its terms to us in 1969. In a complaint to the Grievance Committee all of the owners, including Sample, complained that Caputo had misrepresented the Agreement to us." Exhibit D attached to Susan M. Kafer Affirmation in Opposition, mot. seq. 026 & 029.

The latest event mentioned as justifying an amended answer, and the unmentioned settlement by Carr, Caputo and Dominguez, occurred by early 2004. For the next six years, Caputo-Dominguez felt no need to amend their answer even though the playing field changed substantially when they united with Carr, probably a more critical change than any of the events cited as reason to amend their answer. However, only because the amended answer recycles arguments made in the motion practice leading to Justice Abdus-Salaam's decision in 2002 and the current motion practice, thereby eliminating prejudice to former friends and enemies [*9]wherever they now stand in regard to Caputo-Dominguez's position, leave to amend is granted. Sheppard v Blitman/Atlas Bldg. Corp., 288 AD2d 33, 34 (1st Dept 2001) ("Leave to amend pleadings should be freely granted absent prejudice or surprise").

Caputo-Dominguez also move for a declaratory judgment that the division of interests in the Building is as follows: Carr, 5/12 consisting of her original 1/6 interest, the 1/6 Caspar-Whitten interest and the 1/12 Hoffman interest; Caputo-Dominguez, 5/12 consisting of their original 1/6 interest, the 1/12 Hoffman interest and the 1/6 Sample interest (with the Bradley interest), or alternatively, 4/12 consisting of their original 1/6 interest, the 1/12 Hoffman interest and the 1/12 Sample interest (without the Bradley interest); the partnership, 1/6 consisting of the Kampel interest, or alternatively, 3/12, consisting of the 1/6 Kampel interest and the 1/12 Bradley interest. They maintain that the JG Mangerino estate is due either nothing or the book value of the 1/12 Bradley interest at the time of Bradley's death, and Alpizar is due the book value of the 1/6 Kampel interest at the time of Kampel's death. Their motion for a declaratory judgment is denied for the reasons stated above in the decisions on the Carr, Hoffman-Mangerino and Alpizar motions.

Conclusion

As a result of the decisions above addressing the ownership interest of the various parties, the court finds the undivided ownership interests in the Building, as partners and as tenants in common, are as follows: Carr, 5/12; Caputo, 2/12; Dominguez, 2/12; Alpizar, 2/12; JG Mangerino estate, 1/12.

Accordingly, it is

ORDERED that Carr's motion for summary judgment is denied (mot. seq. 026); and it is further

ORDERED that the branch of Hoffman-Mangerino's motion which seeks a declaratory judgment as to the ownership interests of the Building is granted (mot. seq. 027); and it is further

ADJUDGED and DECLARED that the undivided ownership interests in the Building, as partners and as tenants in common, are as follows: Carr, 5/12; Caputo, 2/12; Dominguez, 2/12; Alpizar, 2/12; JG Mangerino estate, 1/12; and it is further

ORDERED that the branch of Hoffman-Mangerino's motion which seeks money

judgments against Caputo and Dominguez is denied; and it is further

ORDERED that Alpizar's motion for summary judgment is granted to the following extent (mot. seq. 028); and it is further

ADJUDGED and DECLARED that Henry Alpizar has an undivided 1/6 interest in the Building as a partner and tenant in common; and it is further

ORDERED that the branch of the Caputo-Dominguez motion which seeks leave

to amend their answer to the amended complaint is granted, and the amended answer in the proposed form annexed to the moving papers is deemed served (mot. seq. 029); and it is further

ORDERED that the branch of the Caputo-Dominguez motion which seeks a declaratory judgment as to the ownership interests in the Building is denied.

DATED:June ____, 2010

ENTER:

_____________________________

J.S.C.