Plaintiff North Shore Animal Hospital Inc. (NSAH) entered into a five year commercial lease agreement with defendant Bricks & Nails, LLC, dated May 27, 2010, whereby it leased a portion of the first floor of the premises located 42-02 215th Street, Bayside, New York. NSAH operates an animal hospital and veterinary center at said premises. Co-defendant Anthony Chiodi is a member of Bricks & Nails. LLC. Defendants assert that said lease was drafted by the tenant's counsel.

Paragraph 28 of said lease, entitled "ASSIGNMENT AND SUBLETTING" provides as follows:

(a) Tenant acknowledges that Tenant's agreement to operate in the Demised Premises

(b) So long as Tenant gives Landlord written notice within sixty (60) days after an assignment or sublease as contemplated in this Section, Tenant may assign all or part of this Lease, or sublease all or part of the Demised Premises, to:

i) any corporation that has the power to direct Tenant's management and operation, or any corporation whose management and operation is controlled by Tenant; or

ii) any corporation a majority of whose voting stock is owned by Tenant or a majority of the Tenant's shareholders; or

iii) any corporation in which or with which Tenant, its corporate successors or assigns, is merged or consolidated, in accordance with applicable statutory provisions for merger or consolidation of corporations, so long as the liabilities of the corporations participating in such merger or consolidation are assumed by the corporation surviving such merger or created by such consolidation; or

iv) any corporation acquiring this Lease and a substantial portion of Tenant's assets; or

v) any corporate successor to a successor corporation becoming such by either of the methods described in (iii) or (iv), so long as on the completion of such merger, consolidation, acquisition or assumption, the successor has a net worth no less than Tenant's net worth immediately prior to such merger, consolidation, acquisition, or assumption."

Plaintiff alleges that on July 16, 2013, NSAH and its shareholders entered into a letter agreement with VetCor Professional Practices, LLC (VetCor) whereby VetCor, or its designated subsidiary expressed its wishes to purchase NSAH's business and operating assets, including its goodwill. It was also proposed that VetCor or its designated subsidiary would enter into an employment agreement with Dr. Ronald Rosen, a shareholder of NSAH, to serve as the "Chief of Staff" for a period of not less than two years. NSAH thereafter received a proposed draft of an Asset Purchase Agreement which designated VetCor of Bayside LLC (VetCor Bayside) as the purchaser of NSAH's assets.

On August 22, 2013, plaintiff's counsel sent defendant Chiodi, an "Assignment and Assumption of Lease" and a "Waiver" form that had been prepared by VetCor or VetCor Bayside, stating that if he wanted to "discuss or negotiate these terms", he should contact Peter DeFeo. Mr. DeFeo is the Senior Vice President-Acquisitions and General Counsel for VetCor and VetCor Bayside. A copy of the proposed Asset Purchase Agreement, with the purchase price redacted, was provided to the landlord's counsel on September 13, 2013.

Mr. DeFeo, in an email communication dated September 10, 2013 with James Cappa, then an attorney for defendants, stated, in part, that "this proposed assignment of the Lease falls under Section 28(b)(iv) of the Lease, and consent of the Landlord is not required in such case". Mr. Cappa in a response on the same day, stated in pertinent part that: "I would refer you however to paragraph 28 a of the lease which requires the written consent of the landlord and the lease is clearly non transferable without his written consent. Any attempt to do so of course would be a material violation of the lease".

On September 23, 2013, Mr. DeFeo in an email sent to Mr. Cappa, attached for his "review a revised draft of the Assignment and Assumption of Lease, wherein I have deleted the vast majority of my initially requested "amendments" to the Lease. As you will note in the attached, I have only left in two requested amendments: (i) one in order to achieve additional clarity on the "assignment" section of the Lease and (ii) the other to update the "notice" section to reflect VetCor's contact information". Mr. DeFeo also stated that VetCor would be willing to pay the $1,000.00 administrative fee set forth in Section 28(a) of the lease, and to pay counsel's reasonable legal fees in connection with his representation of Mr. Chiodi in this matter. Mr. DeFeo further stated: "We would like to be clear (again): there is no "required" consent needed from the Landlord pursuant to Section 28(b) of the Lease in order to assign the Lease in connection with the sale of substantially all of the assets of North Shore Animal Hospital. We think it would be a waste of everyone's time, money and resources to have to resort to litigation to address this matter, but certainly if that is what Mr. Chiodi decides to do, we are very prepared to successfully defend such litigation, as well as pursue our own claims against Mr. Chiodi in such event (i.e. "tortious interference" with our completion of the VetCor/North Shore Animal Hospital acquisition transaction)."

Mr. Cappa responded to Mr. DeFeo in an email dated September 24, 2013, stating, in pertinent part, "You continuously indicate that the lease in question does not require the landlord's consent. We are not in agreement as to that basic question. I believe that there is no need to reiterate the language of the relevant provision. It is quite clear. Any attempt by the current tenant to assign the lease without the consent of the landlord is in violation of the lease and would be deemed a material breach of the same. My client would, in such event, seek all remedies permissible under the law... Furthermore your threats of litigation in your email are not taken lightly...Let me remind you that to this day you are not seeking merely an assignment of the lease, you are seeking an amendment of the lease. While you have altered your initial amendment request, you still desire the original lease amended in conjunction with the landlord's consent...".

On September 25, 2013, Mr. DeFeo sent an email to defendants' then counsel and plaintiff's counsel, requesting their review of a "revised version of the Assignment of Lease, reflecting the deletion of the previously requested language to better clarify the "assignment" language set forth in Section 28 of the Lease. Mr. DeFeo further indicated, "As you will note, we now have limited the requested "amendment" to simply change the "name and address" of the tenant for purposes of VetCor of Bayside LLC (potentially) becoming the new tenant in this Building." Mr. DeFeo also conceded that the landlord was not required to execute the proposed "Landlord Waiver and Consent Form" and that said form was not required by VetCor's lender.

Mr. Chiodi as a member of Bricks & Nails, LLC did not execute the proposed [*2]assignment of the lease containing amendments to the lease and did not execute the waiver form.

Counsel for the defendants in an email dated September 27, 2013, informed Mr. DeFeo that there were a number of monetary issues owed by NSAH to Mr. Chiodi, which must be resolved and paid in full before he would negotiate a new lease with VetCor. Mr. DeFeo responded in an email dated September 27, 2013 in which he made reference to potential outstanding items owed by NSAH to the landlord; stated that the parties are not amending the lease or negotiating a new lease; noted that Mr. Chiodi had been "very adamant" about not amending even the technical language of the lease, and stated that VetCor had agreed to same, and requested that counsel discuss the interpretation of the language of the lease requiring the landlord's consent to assign the lease.

Mr. DeFeo in an email dated October 2, 2013 expressed his desire to go forward with the acquisition of NSAH, and stated that "...I think that we can all agree that Mr. Chiodi's request for a payment of $250,000 for a "consent" -even if it were required to assign this Lease (which it is not per Section 28(b)...) Does not fit within any practical definition of "reasonable" (under Mr. Chiodi and your theory of the Lease assignment-as under Section 28(a) of the Lease the Landlord can not unreasonably withhold consent to a Lease assignment in a non-business sale context)."

The negotiations to acquire NSAH's assets thereafter stalled.

Plaintiff NSAH commenced the within action on October 18, 2013. In the first cause of action for declaratory judgment, plaintiff alleges that a justiciable controversy exists as to the meaning and interpretation of paragraph 28 of the lease between NSAH and Bricks & Nails, Inc., that defendants "have declared that any attempt to assign the Lease to an entity acquiring a substantial portion of the Plaintiff's assets shall constitute a material breach of the Lease"; that defendants "have threatened to hold the Plaintiff in default and consequently VetCor as Assignee in the event that the Lease is assigned without Defendants' consent"; and that the plaintiff's right to assign the Lease pursuant to Paragraph 28(b)(iv) needs to be determined by the court. Plaintiff seeks a declaration to the effect that Paragraph 28(b)(iv) of the Lease does not require it to obtain the defendants' consent to assign the Lease when it is assigning it to a company acquiring a substantial portion of the plaintiff's assets, plus legal fees and costs, pursuant to paragraph 28(b)(ix) of the lease.

In the second cause of action for declaratory judgment, plaintiff includes a list of what it alleges to be the substantial portion of its assets that VetCor proposes to acquire, [*3]and alleges that it is entitled to assign the Lease to VetCor without the defendants' consent, provided that it provide written notice of the assignment within sixty days following the assignment pursuant to paragraph 28(b)(iv) of the Lease. Plaintiff seeks a judgment declaring that a lease assignment to VetCor commensurate with VetCor's acquisition of plaintiff's assets does not require defendants' consent pursuant to paragraph 28(b)(iv) of the subject lease, plus legal fees pursuant to paragraph 28(b)(ix) of the lease.

Plaintiff in its third cause of action to recover damages for tortious interference with a prospective contract alleges that it engaged in contract negotiations with VetCor for the sale of its assets; that the intended purchase price was $2,650,000.00; that defendants' threat to hold plaintiff and its assignee in default under the lease in the event that the assignment is made without their consent constitutes wrongful means; that defendants' claim that any such assignment without first obtaining their consent will be considered a material breach of the contract for which they will seek all remedies permissible under the law constitutes wrongful means; that defendant's demand of $250,000 to obtain his consent is "nothing short of extortion" and constitutes wrongful means by way of economic pressure; and that as a result of defendants' conduct, the transaction cannot close. Plaintiff alleges that it has sustained damages in an amount not less than $2,650,000.00; that the proceeds of the sale were going to be used to satisfy a debt incurred by plaintiff; and that plaintiff "pays interest on the debt that was to be paid in an amount to be determined at the time of trial".

Defendants have served a verified answer in which they allege Mr. DeFeo sought to revise the current lease; that the requests for an amendment to the lease is not an assignment as contemplated under paragraph 28(b) of the lease; and that to the extent plaintiff demanded a new lease, the landlord was entitled to seek additional monetary compensation. Defendants

Plaintiff has served a verified reply to the counterclaims, and have interposed four affirmative defenses.

Plaintiff now moves for summary judgment on its first and second causes of action for declaratory judgment. With respect to the first cause of action, plaintiff asserts that Paragraph 28(b)(iv) of the lease does not require it to obtain the consent of the landlord when the acquiring company is also acquiring a substantial portion of the plaintiff's assets. It is asserted that the landlord's consent is required pursuant to Paragraph 28(a) only as to those type of assignments that are not specifically provided for in Paragraph 28(b)(iv).

With respect to the second cause of action, plaintiff asserts that the transaction which gave rise to the dispute here clearly falls within the meaning of Paragraph 28(b)(iv), as plaintiff intends to sell substantially all of its assets to VetCor Bayside in accordance with and pursuant to an Asset Purchase Agreement. Plaintiff therefore asserts that the lease can be assigned to VetCor Bayside without the consent of the landlord.

Defendants, in opposition, assert that there is no dispute as to the meaning of paragraph 28(b)(iv) of the lease and therefore the claims for declaratory judgment should be dismissed. Defendants assert that had NSAH sought to assign the lease in connection with the acquisition of substantially all of its assets, it did not need to seek the consent of the landlord. It is asserted that rather than simply assigning the existing lease, NSAH requested that the landlord discuss and negotiate the terms of the lease with the prospective purchaser, who sought to amend the terms of the existing lease. It is asserted that the landlord was unwilling to modify the terms of the lease and was not required to do so under Paragraph 28(b)(iv), which does not provide for a modification of the lease, and that the landlord had no obligation to either the tenant or the prospective purchaser to renegotiate the terms of the existing lease.

Defendants further assert that as the landlord's consent was not required in order to assign the lease pursuant to paragraph 28(b)(iv), the third cause of action for tortious interference with prospective contractual relations should be dismissed.

Plaintiff asserts that as the parties now all agree on the meaning of paragraph 28(b)(iv), its request for summary judgment on the first cause of action should be granted. With respect to the second cause of action, plaintiff asserts that as defendants do not contest that the prospective acquisition of substantially all of its assets by VetCor Bayside complies with paragraph 28(b)(iv), its request for summary judgment on the second cause of action should be granted. Finally, with respect to the third cause of action plaintiff asserts that VetCor Bayside pulled out of the transaction because the defendants threatened litigation if an assignment was made without first obtaining their consent, and that their consent could be purchased for $250,000; that these pre-litigation statements were intentionally and knowingly made and constituted wrongful means that prevented [*4]plaintiff from selling its business to VetCor Bayside. Mr. DeFeo in an affidavit submitted in opposition to the defendants' cross motion states that VetCor could not proceed with the acquisition of NSAH's assets, as "the real threat of litigation and the uncertainty of a prospective relationship with the landlord made this an untenable acquisition at that time."

The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any material issues of fact from the case. To grant summary judgment, it must clearly appear that no material and triable issue of fact is presented (Ayotte v Gervasio, 81 NY2d 1062, 1063 [1993]; see Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]; Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395[1957]). The movant has the initial burden of proving entitlement to summary judgment (Winegrad v NY Univ. Med. Ctr., 64 NY2d 851[1985]). Failure to make such a showing requires denial of the motion, regardless of the sufficiency of the opposing papers (Winegrad v NY U. Med. Ctr., supra). Once such proof has been offered, the burden then shifts to the opposing party, who, in order to defeat the motion for summary judgment, must proffer evidence in admissible form . . . and must "show facts sufficient to require a trial of any issue of fact" (CPLR 3212[b]; Zuckerman v New York, 49 NY2d 557[1980]).

It is well settled that the courts may issue declaratory judgments declaring the rights of the parties only where there is a justiciable controversy. (see CPLR 3001; Realtime Data, LLC v Melone, 104 AD3d 748, 751 [2d Dept 2013].) "To constitute a "justiciable controversy," there must be a real dispute between adverse parties, involving substantial legal interests for which a declaration of rights will have some practical effect (see Downe v Rothman, 215 AD2d 716[2d Dept 1995]; De Veau v Braisted, 5 AD2d 603 [2d Dept 1958], affd 5 NY2d 236 [1959], affd 363 US 144 [1960]; Playtogs Factory Outlet v County of Orange, 51 AD2d 772 [2d Dept 1976]). A controversy is said to exist where the plaintiff asserts rights which are actually challenged by the defendant (see DeVeau v Braisted, 5 AD2d at 603). The primary purpose of a declaratory judgment is to stabilize an uncertain or disputed jural relationship with respect to present or prospective obligations. (see Goodman v Reisch, 220 AD2d 383 [2d Dept 1995].)" ( Chanos v Madac, LLC, 74 AD3d 1007, 1008 [2d Dept 2010]).

"To establish a claim of tortious interference with prospective economic advantage, a plaintiff must demonstrate that the defendant's interference with its prospective business relations was accomplished by wrongful means' or that defendant acted for the sole purpose of harming the plaintiff" (Carvel Corp. v Noonan, 3 NY3d 182, 190 [2004]; NBT Bancorp v Fleet/Norstar Fin. Group, 87 NY2d 614, 624 [1996]). "As a [*5]general rule, such wrongful conduct must amount to a crime or an independent tort, and may consist of physical violence, fraud or misrepresentation, civil suits and criminal prosecutions'" (Smith v Meridian Tech., Inc., 86 AD3d 557, 560 [2011], quoting Guard-Life Corp. v Parker Hardware Mfg. Corp., 50 NY2d 183, 191 [1980]; see NBT Bancorp v Fleet/Norstar Fin. Group, 87 NY2d at 624).

It is noted that prior to the commencement of this action the landlord's prior counsel opined that under paragraph 28(a) of the lease the landlord's consent was required in order to assign the lease, while counsel for the tenant and prospective assignee opined that no such consent was required under paragraph 28(b)(iv) of the lease. However, there is no evidence that the parties were ever in disagreement as to the meaning of terms set forth in paragraph 28(b)(iv) of the lease. Rather, it is apparent that the prospective purchaser of the tenant's assets sought to change the terms of the lease instead of accepting a straight forward assignment of the lease, and also sought to have the landlord execute a waiver and consent form which was claimed to be required by the prospective assignee's senior lender. The landlord was not required to accept any such changes to the lease terms or to execute any such forms, and declined to do so.

As plaintiff only seeks declaratory judgment with respect to paragraph 28(b)(iv) of the lease, and as defendants assert that there is no disagreement as to the meaning of the terms of said paragraph, the court finds that no justiciable controversy exists with respect to paragraph 28(b)(iv) of the lease. The court further finds that there is no evidence that the parties are in disagreement as to whether the proposed asset purchase agreement constitutes an acquisition of a substantial portion of the plaintiff's assets pursuant to the terms of paragraph 28(b)(iv) of the lease. Thus, no justiciable controversy exists with respect to the meaning of the terms of paragraph 28(b)(iv) of the lease. Accordingly, that branch of the plaintiff's motion which seeks summary judgment on the first cause of action for declaratory judgment is denied, and that branch of defendant's cross motion which seeks summary judgment dismissing the first cause of action, is granted.

With respect to the third cause of action for tortious interference with prospective contractual relations, plaintiff's claim that the defendants threatened to hold the tenant and the assignee in default under the lease, and would seek all remedies permissible under the law in the event an assignment was made without the landlord's consent, does not amount to a crime or an independent tort.

Plaintiff's allegation that defendant demanded the sum of $250,000.00 in exchange for its consent and that this constituted economic pressure, is also insufficient to establish conduct amounting to a crime or an independent tort. Mr. Chiodi states in an affidavit with respect to modifications of the lease, during the negotiations, his former attorney may have stated that there [*6]would be "certain monetary requirements" but that at "no time whatsoever did my attorney state that if the Tenant complied with the provisions of the Lease, that the Landlord would require a $250,000.00 down payment".

Plaintiff, in opposition to the cross motion for summary judgment proffers Mr. DeFeo's affidavit, in which he states, in pertinent part, that on September 30, 2013 he spoke with Mr. Mattone, Mr. Chiodi's co- counsel, and that "he advised that Mr. Chiodi's requested payment for legal fees, CPA fees and "other" to obtain Mr. Chiodi's consent to the assignment was "$250,000.00." Mr. DeFeo further states that although he considered Mr. Chiodi's demand to be unreasonable, he continued to negotiate with his attorney's through October 2, 2013.

The court finds that Mr. DeFeo's affidavit is insufficient to raise a triable issue of fact with respect to the third cause of action. The evidence presented establishes that the plaintiff tenant had directed the defendant landlord to negotiate the terms of the assignment with the prospective assignee; that the prospective assignee sought to alter the terms of the lease; that the alleged demand by the landlord, or his former counsel, for the payment $250,000.00 arose during the course of negotiations between the landlord and the prospective assignee; and that the prospective assignee had previously offered to pay the landlord's reasonable attorneys' fees. The court finds that under these circumstances, plaintiff is unable to establish a claim for tortious interference with prospective contractual relations, as the possible payment of attorneys' fees by the prospective assignee, as well as a proposal made to the prospective assignee for the payment of compensation in exchange for rewriting the terms of the lease, does not amount to economic duress. Therefore, that branch of defendants' cross motion which seeks to dismiss plaintiff's third cause of action, is granted.

Turning now to defendants' request for summary judgment on the second counterclaim for costs, expenses and legal fees incurred in the defense of this action, paragraph 29(ix) of the subject lease provides as follows:

As defendants' motion to dismiss the complaint is granted in its entirety, defendant landlord Bricks & Nails, LLC is the prevailing party, and thus is entitled to recover costs, expenses and reasonable attorney's fees from the plaintiff. The individual defendant Anthony Chiodi is not a party to the lease agreement in his individual capacity, and therefore is not [*7]entitled to recover legal fees and expenses from the plaintiff. Therefore, that branch of the defendants' motion which seeks partial summary judgment on the second counterclaim is granted solely as to defendant Bricks & Nails, LLC.

Plaintiff's motion for summary judgment on its first and second causes of action for declaratory judgment is denied, and that branch of the defendants' cross motion to dismiss these claims is granted as no justiciable controversy exists between the parties with respect to the subject lease. That branch of the defendants' cross motion which seeks to dismiss the plaintiff's third cause of action is granted. That branch of the defendants' cross motion which seeks partial summary judgment on their second counterclaim is granted solely as to defendant Bricks & Nails, LLC, and the matter shall be set down for a hearing on December 15, 2014 at 10:00 a.m., in Part 4, courtroom 66, 88-11 Sutphin Boulevard, Jamaica, New York, as to the amount of reasonable attorney's fees, expenses and costs incurred in the defense of this action.