[*1]
Matter of Flushing Acquisition Holdings LLC v Donative Concrete Inc.
2013 NY Slip Op 50620(U) [39 Misc 3d 1215(A)]
Decided on April 18, 2013
Supreme Court, Kings County
Schmidt, J.
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.


Decided on April 18, 2013
Supreme Court, Kings County


In the Matter of the Application of Flushing Acquisition Holdings, LLC, Petitioner,

against

Donative Concrete, Inc., Respondent-Lienor.




23714/12



Plaintiff Attorney: Berg Law, PLLC, 266 Broadway, Suite 404, Brooklyn, NY 11211

Defendant Attorney: Goldberg & Rimberg, PLLC, 115 Broadway, 3rd Floor, New York, NY 10006

David Schmidt, J.



Upon the foregoing papers, Flushing Acquisition Holdings, LLC (petitioner) moves by order to show cause to discharge the mechanic's lien filed by Donative Concrete, Inc. (respondent) against real property located at 505-515 Flushing Avenue in Brooklyn (the Property).

Background

Petitioner owns the Property, which consists of lots 30, 62, 63, 64, 65 and 67 in [*2]block 2263 of Kings County. Petitioner hired respondent to pour a concrete foundation and perform other work on the multi-unit condominium buildings petitioner constructed on the Property. Due to a subsequent payment dispute, respondent filed a mechanic's lien against lots 62, 64, 65 and 67 on March 8, 2011. This lien alleged an unpaid amount of $183,006.99 out of a total contract price of $1,048,571.40 for respondent's work, which was performed between July 21, 2008 and July 19, 2010. Respondent filed a satisfaction of this lien on October 12, 2011. Further, respondent filed a new mechanic's lien the same day against all six lots of the Property and alleged an unpaid amount of $111,957.00 out of a contract price of $1,052,521.40 for work performed between July 21, 2008 and March 22, 2011.

Petitioner now demands that respondent show cause why the court should not direct the clerk to release the October 12, 2011 lien except as to unit 3B in 505 Flushing Avenue (lot 1725 in block 2263). Petitioner acknowledges a good-faith dispute over $111,957, but argues that the lien is needlessly broad in that it effectively bars sale of millions of dollars worth of condominium units. As unit 3B's appraised value is $460,000, petitioner asserts that respondent will suffer no prejudice by constraining the lien to only that unit. Petitioner urges it needs such relief in order to execute scheduled sales of other units on the Property.

The court issued a short form order, pending final determination, to discharge and release the October 12, 2011 lien except as to unit 3B. Such discharge would take effect, however, only upon petitioner's proving to respondent's attorney that petitioner had placed $111,957 into escrow with its own attorney. The order further directs that any such funds remain in plaintiff attorney's IOLA account until the court orders its release.

Respondent argues, in opposition, that the court lacks power to discharge a lien except, as authorized by Lien Law § 19 (6) ,where the notice of lien is facially defective. Respondent asserts that petitioner does not contest the facial validity of the lien and that petitioner's argument that the court may equitably modify the lien due to financial hardship is improper.

Discussion

"A court has no inherent power to vacate or discharge a mechanic's lien except as authorized under Lien Law § 19 (6)" (Matter of Luckyland (NY), LLC v Core Cont. Constr., LLC, 83 AD3d 1073, 1074 [2011]; see also Matter of Gold Dev. & Mgt., LLC v P.J. Contr. Corp., 74 AD3d 1340, 1341 [2010]; Matter of Northside Tower Realty, LLC v Klin Constr. Group, Inc., 73 AD3d 1072, 1072 [2010]). Lien Law § 19 (6) permits a court to discharge a mechanic's lien if it is facially defective due to the character of the labor or materials involved or failure to comply with Lien Law § 9 or if it was improperly filed under Lien Law § 10.[FN1] Similarly, a court may not partially vacate a mechanic's lien where [*3]the notice of lien is facially sufficient (see Bryan's Quality Plus, LLC v Dorime, 80 AD3d 639, 640 [2011] [holding trial court improperly vacated portion of mechanic's lien because amount validity a question for trial]).

Only a party who performed labor or furnished materials for the improvement of real property may file a mechanic's lien (see Lien Law § 3). A notice of lien must state (1) the lienor's name, residence, corporate information and attorney, (2) the name of the property owner against whom the lien is claimed, (3) the name of the person who employed the lienor, (4) the labor performed or materials furnished and agreed price or value, (5) the amount unpaid, (6) the time of the first and last work performed and (7) a description of the property (Lien Law § 9). A notice of lien also must generally be filed within eight months of the completion of the underlying work (four months for a single-family dwelling) and feature the block number of the property liened against (see Lien Law § 10).

Petitioner herein does not assert that the October 12, 2011 lien is facially defective, and instead argues that equity requires partially discharging this lien as it impacts property of value disproportionate to the amount in dispute. This requested relief exceeds the court's purview, and thus cannot be granted.[FN2]

Petitioner may, of course, discharge the lien by executing a bond for 110% of the lien amount and delivering such bond to the respondent and county clerk (see Lien Law § 19 [4]) or by depositing the lien amount with interest with the county clerk (see Lien Law § 20). Given the value of the Property, petitioner should encounter no problem in executing a bond for the appropriate amount and freeing up the bulk of its condominium units for sale. Accordingly, it is

ORDERED that the short form order of December 17, 2012 is recalled; and it is further

ORDERED that petitioner's motion is denied in its entirety.

E N T E R,

J. S. C.

Footnotes


Footnote 1: Lien Law § 19 (3), in conjunction with Lien Law § 59, also permits a court to vacate a mechanic's lien due to a lienor's failure to prosecute .

Footnote 2: Other courts have resolved similar situations by finding a mechanic's lien facially defective (at least as to individual units) if it seeks to encumber an entire building of condominium units utilizing the original lot numbers instead of the lot numbers assigned to each unit during the condominium conversion (see e.g. Matter of Bridge View Tower, LLC v Roco G.C. Corp., 69 AD3d 711, 712-13 [2010]; Northeast Restoration Corp., v K & J Constr. Co., 304 AD2d 306, 307 [2003]; Matter of M.M.E. Power Enters. (Wolf & Son Enters.), 205 AD2d 631, 632 [1994]; Matter of Atlas Tile & Marble Works (S & H 88th St. Assoc.), 191 AD2d 247, 248 [1993], lv granted 82 NY2d 651 [1993], appeal withdrawn 82 NY2d 847 [1993]; cf. Mussen v Franklin Sq. Assoc., V., LLC, 22 AD3d 1022, 1022-23 [2005]). Petitioner herein does not, however, argue or introduce any evidence to support this theory.