Plaintiff has moved by Order to Show Case to vacate and set aside an Order entered in letter form, dated July 2, 2013, in response to a letter from Plaintiff's counsel, dated June 26, 2013. The Order to Show Cause, signed by Appellate Division Justice John M. Leventhal and made returnable before this Court, was signed after I had declined to sign the Order to Show Cause because it tracks an argument made in a prior motion to reargue heard by this Court on September 4, 2013, which was denied following argument. This Court perceives the actions of Plaintiff as an attempt to do an end-run around this Court's prior decisions and, apparently, obtain an appealable order for further litigation before the Appellate Division since the primary argument raised in opposition to the July 2 Order re-appointing Richard Klass as Liquidating Trustee, following the Appellate Court's affirmance of this Court's granting of Plaintiff's petition to dissolve the subject limited liability company which owns the real estate Plaintiff seeks to obtain, is that this Court failed to comply with the decision of the Appellate Division dated March 27, 2013.

Upon dissolution of a limited liability company, the "affairs" of the company must be wound up. This includes satisfaction of the liabilities of the company (LLCL §§ 703-704). The real estate at issue is encumbered by a substantial mortgage which must be addressed in the winding up process. The LLCL provides for the discretionary appointment of a receiver or liquidating trustee to supervise such winding-up (LLCL § 703(a)). Given the extraordinary [*2]acrimony between the parties and the fact that the mortgagee has not participated in this matter, and further, the substantial debt owed to the company by respondent which continues to accrue, this Court found it necessary and appropriate to designate a neutral third party to oversee the winding up and distribution of the assets of the company. This Court understands the prior decision of the Appellate Court, dated January 31, 2013, remitting this matter to this Court for "further proceedings and for a determination thereafter as to the value of the defendant's interest in the LLC" to contemplate just such action by this Court.

While it is true that, in its Order of January 15, 2013, this Court accepted as agreed, an appraised value of the property at $4,550,000 "with caveats regarding the volatility of capital markets going forward" "for the purposes of [that] decision", nine months have elapsed since that time and the appraisal of market value was rendered effective February 12, 2012. The real property values in Kings County have changed significantly since that time and a new appraisal will be required, the cost of which shall be born by the company.

In obtaining the instant Order to Show Cause, Plaintiff represented that it had been entered "sua sponte", in excess of the Court's authority and jurisdiction. However, as noted, the letter of July 2, 2013, was expressly in response to Plaintiff's attorney's letter of June 26, 2013, urging this Court to proceed by way of a conference. In order to expedite relief to Plaintiff, the Court did not require that a formal motion be made, but drafted the July 2, 2013 letter, which was subsequently endorsed as an Order so as to facilitate appellate review. If the Court has misapprehended the intent of the Appellate Court in its decision of January 31, 2013, perhaps further instruction is required, particularly with respect to the Court's duty regarding liquidation and distribution of assets of a limited liability company following judicial dissolution.

Accordingly, this Court declines to vacate the July 2, 2013 letter Order and directs that a new appraisal of the real property be obtained by the Plaintiff who remains in physical control of the building. Alternatively, the parties may stipulate to accept the "Investment Value" of $5,506,840, as determined by Massey Knakal Realty Services in July 2013.

Mr. Klass, as liquidating trustee, shall proceed to determine the value of the defendant's interest in the company so that Plaintiff may purchase such interest. Prior to transfer of title to the real property, the Liquidating Trustee shall take a full accounting of the outstanding liabilities and communicate with the mortgagee regarding satisfaction of the mortgage. A plan for winding-up the company and satisfying all liabilities shall be submitted to the Court within thirty (30) days.

This constitutes the Decision and Order of the Court.

E N T E R,

J. S. C.