In this action, plaintiff seeks to recover allegedly unpaid use and occupancy and additional rent. Plaintiff moves for summary judgment as to liability and for an inquest on damages. Defendant The City of New York (the "City"), acting through the Department of Citywide Administrative Services ("DCAS"), opposes the motion and cross-moves for summary judgment in its favor dismissing the complaint. The motion and cross-motion are decided as follows.

Many of the relevant facts are undisputed. In or about May 2005, plaintiff purchased the building located at 40 Rector Street, New York, New York (the "building"). Pursuant to a lease dated October 20, 1994 (the "original lease"), plaintiff's predecessor-in-interest leased portions of the building to the City. There were three subsequent lease amendments, dated July 12, 1996, May 9, 1997 and August 7, 1997 (the original lease and its subsequent amendments are herein referred to as the "lease").

In or about 2010, plaintiff submitted a proposed condominium conversion plan for approval and filing, which was accepted and filed by the New York State Attorney General on May 10, 2010. Plaintiff declared the condominium effective as of June 22, 2011.

Meanwhile, the lease expired on July 23, 2010. As of that date, defendant occupied ten floors rented directly from plaintiff, two floors as licensee or sub-tenant of other building tenants, and various storage spaces. Plaintiff collected rent on a month-to-month basis from defendant after the lease expired. According to defendant, the parties attempted to negotiate a prospective short-term lease through December 31, 2013.

Defendant further maintains that on or before September 30, 2010, the City Commission on Human Rights ("CCHR") vacated the space it had been occupying on the 9th floor of the building and so notified plaintiff on or before that date. As proof, defendant has provided the affidavit of Nimer Basha, Assistant Commissioner for Human Resources at the CCHR. Mr. Basha states that CCHR paid rent through September 2010 and that he personally communicated with Mr. Rosario, head of the building's maintenace staff, that CCHR moved out of the 9th floor on or before September 30, 2010.

In April 2011, lease negotiations between the parties fell through, and plaintiff served thirty-day notices of termination dated April 11, 2011 under which plaintiff "elected to terminate [defendant's] month to month tenancy" and directed defendant to surrender possession on or before May 31, 2011. According to defendant, the Taxi and Limousine Commission ("TLC") vacated the space it had been occupying on the 5th and 8th floors of the building.

In a letter dated April 29, 2011, Jeff Kondrat, Assistant Commissioner of DCAS notified Michael Pilevsky of Phillips International that it had vacated the 5th, 8th and 9th floors on the aforementioned dates (collectively referred to herein as the "subject premises" or "disputed portions of the premises"). On or about June 3, 2011, plaintiff commenced six holdover proceedings in Civil Court, New York County whereby plaintiff sought to recover possession of [*2]the space rented under the lease. On August 3, 2011, the parties entered into a limited release and indemnification (the "Limited Release") whereby the parties partially settled plaintiff's claims for use and occupancy.

Plaintiff specifically excepted from the release the following, in pertinent part:

On January 18, 2012, the parties executed an "Interim Payment Agreement" (the "IPA"). Pursuant to that agreement, the City was to pay plaintiff $1 million as a credit toward use and occupancy owed by the City for the period from June 1, 2011 through January 18, 2012 for portions of the subject premises. In the IPA, the parties acknowledged that: [1] the City withheld payments for use and occupancy from June 1, 2011 due to the pendency of the Holdover Proceedings; and [2] that the City had paid use and occupancy through and including May 31, 2011 "without prejudice to [plaintiff's] claims for certain additional payments through that date; to any of the City's objections and defenses to said claims; or to any claim, position, right or defense of either said party in the Holdover proceedings."

On February 28, 2012, plaintiff and defendant entered into an agreement concerning defendant's occupancy of the building as of June 1, 2011 entitled Surrender of Tenancy and Occupancy Agreement (the "Surrender Agreement"). The Surrender Agreement provided in relevant part that:

The Surrender Agreement further states:

Lastly, the Surrender Agreement also provides for recovery of reasonable attorneys fees "[i]n the event [plaintiff] or the City is required to commence litigation, to enforce its rights hereunder or the Stipulations, based upon the other's default in performance of any obligation hereunder".

Plaintiff has asserted four causes of action: use and occupancy for the 5th floor and a portion of the 8th floor from May 1, 2011 through February 28, 2012 and 9th floor from October 1, 2010 through February 28, 2012 and seeks damages in the amount of $1,067,045.25 plus interest (first cause of action); "additional charges" representing real estate taxes, freight elevator charges, rubbish removal charges, operating expense escalations, water and electric and additional services for the premises and time periods specified in the first cause of action in the amount of $400,132.15 plus interest (second cause of action); "payment for the balance of the fair market use and occupancy value related to the City's possession, use and/or occupancy of all portions of the building excluding the subject premises for the period through and including May 31, 2011" in the amount of $260,820.22 (third cause of action); and attorneys fees (fourth cause of action).

The City made a pre-answer motion to dismiss, which was denied by the Hon. Kathryn Freed in a decision/order dated January 10, 2014. Justice Freed essentially held that the City had not met its burden of establishing entitlement to dismissal based upon the documentary evidence. Justice Freed wrote, in part:

Perhaps the most important fact militating in favor of the denial of the City's motion is its failure to incorporate into the IPA or the Surrender Agreement that certain floors had been vacated and were therefore no longer subject to additional rent and/or use and occupancy. Since the issue of use and occupancy for the disputed spaces was never resolved, the City's motion must be denied...

In its answer, the City generally denies many of the allegations, denies occupying the 5th, [*3]8th and 9th floors for the period which plaintiff seeks use and occupancy and claims that the additional charges were paid as part of the monthly use and occupancy already paid.

Plaintiff argues that based on the Surrender Agreement, there can be no dispute that the City surrendered legal possession of the subject premises on February 28, 2012. Further, plaintiff maintains that it has established entitlement to summary judgment on the issue of liability for all causes of action because there is no dispute that the City has not paid use and occupancy for portions of the subject premises for the periods reserved in the Limited Release. Plaintiff has provided an explanation of the rent and additional rent it seeks to recover herein as well as affidavits by Debra Boyle, lease administrator of Phillips International Holding Corp., plaintiff's managing agent.

In turn, defendant generally contends that it cannot be held liable for use and occupancy for space it did not actually occupy. Defendant specifically argues that it cannot be held liable for use and occupancy or additional rent because it became a month-to-month tenant and vacated the spaces which therefore terminated the subject tenancies, regardless of the surrender date set forth in the Surrender Agreement. The City next maintains that plaintiff is not entitled to rent or additional rent for the period after June 1, 2011 because the City has paid all amounts due pursuant to the Surrender Agreement. Finally, the City argues that plaintiff's claim for legal fees is untenable.

On a motion for summary judgment, the proponent bears the initial burden of setting forth evidentiary facts to prove a prima facie case that would entitle it to judgment in its favor, without the need for a trial (CPLR 3212; Winegrad v. NYU Medical Center, 64 NY2d 851 [1985]; Zuckerman v. City of New York, 49 NY2d 557, 562 [1980]). If the proponent fails to make out its prima facie case for summary judgment, however, then its motion must be denied, regardless of the sufficiency of the opposing papers (Alvarez v. Prospect Hospital, 68 NY2d 320 [1986]; Ayotte v. Gervasio, 81 NY2d 1062 [1993]).

Agreements should be construed in accord with the parties' intent (Greenfield v. Philles Records, Inc., 98 NY2d 562 [2002]). "The best evidence of what parties to a written agreement intend is what they say in their writing" (id quoting Slamow v. Del Col, 79 NY2d 1016 [1992]). "Thus, a written agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms" (id at 569).

"A contract is ambiguous if the provisions in controversy are reasonably or fairly [*4]susceptible of different interpretations or may have two or more different meanings' " (New York City Off-Track Betting Corp. v. Safe Factory Outlet, Inc., 28 AD3d 175 [1st Dept 2006] quoting Feldman v. National Westminster Bank, 303 AD2d 271 [2003], lv. denied 100 NY2d 505 [2003]). The existence of ambiguity is a question of law and is determined by examining the "entire contract and consider[ing] the relation of the parties and the circumstances under which it was executed," with the wording to be considered "in the light of the obligation as a whole and the intention of the parties as manifested thereby" (Geothermal Energy Corp. v. Caithness Corp. 34 AD3d 420 [2d Dept 2006] quoting Kass v. Kass, 91 NY2d 554, 566 [1998]).

When a term or clause is ambiguous, "the parties may submit extrinsic evidence as an aid in construction, and the resolution of the ambiguity is for the trier of fact" (Geothermal Energy Corp. v. Caithness Corp. supra, quoting Pellot v. Pellot, 305 AD2d 478, 481 [2d Dept 2003]).

While the Surrender Agreement fixed February 28, 2012 as the date which the City's tenancy of "any and all portions of the Building, including but not limited to the Previously Demised Premises" was terminated and the date which the City surrendered possession and plaintiff accepted such surrender, the Surrender Agreement further provided that "nothing contained [t]herein is intended to, nor shall, in any manner, alter any of the City's defenses, set-offs and objections to the Owner's claim[ for use and occupancy of the subject portions of the premises]."Further, both parties acknowledged in the Surrender Agreement that after the expiration of the lease, the City vacated portions of the Previously Demised Premises.

Here, the Court finds that the surrender date provision conflicts with the express provision that the Surrender Agreement was not intended to alter plaintiff's claim and the City's defense regarding use and occupancy of the disputed portions of the premises.

In light of this ambiguity, the court may look to extrinsic or parol evidence. Given the number of times that the parties tried to carve out an exception for the very issue this litigation arises from and the absence of express language demonstrating that the parties intended to resolve this issue in the Surrender Agreement, coupled with the exception contained in the Surrender Agreement itself already identified by the court, plaintiff's motion must be denied. To grant plaintiff's motion and find that the surrender date resolves this issue would be a miscarriage of justice since it is merely a gotcha attempt by the plaintiff to use what may be poor contract drafting to infer meaning which the record here shows neither party intended to agree to.

Without proof which demonstrates that defendant intended to waive its defenses as to plaintiff's claims for use and occupancy for the disputed portions of the premises via the Surrender Agreement, plaintiff has not established entitlement to summary judgment on the first or second causes of action.

Plaintiff's argument that the City cannot rely on prior representations or understandings based upon the integration clause contained in the Surrender Agreement does not require a different result. The City is not relying on prior representations or understandings, but rather [*5]arguing that the Surrender Agreement does not resolve the dispute between the parties concerning use and occupancy of the disputed portions of the premises. Nor is Justice Freed's decision on the City's motion to dismiss law of the case.

As for the third cause of action, plaintiff seeks "payment for the balance of the fair market use and occupancy value related to the City's possession, use and/or occupancy of all portions of the building excluding the subject premises for the period through and including May 31, 2011". There is no dispute that at the time the parties entered into the Limited Release, plaintiff claimed the City owed $3,465,356.43 but the City only paid $3,204,537.21, leaving a balance of $260,820.22 which the Limited Release explicitly excepted. However, beyond the terms of the Limited Release, plaintiff has not provided any proof of the balance allegedly owed by the City. Therefore, plaintiff's motion for summary judgment on the third cause of action is denied.

Insofar as plaintiff has not prevailed on any cause of action arising from the Surrender Agreement, plaintiff's motion on the fourth cause of action is also denied. Accordingly, plaintiff's motion for summary judgment is denied in its entirety.

The court now turns to the City's cross-motion for summary judgment. Here, the City has established that on or before September 30, 2010, the CCHR vacated the space it had been occupying on the 9th floor of the building and Mr. Basha notified plaintiff on or before that date and that on April 29, 2011, Mr. Kondrat notified plaintiff that the TLC vacated the space it had been occupying on the 5th and 8th floors of the building. Insofar as there is no dispute that on both of these dates, the lease had expired and the respective agencies were month-to-month tenants at the time that they notified plaintiff that they were vacating the subject premises, plaintiff's claim for use and occupancy for the disputed portions of the premises while they were vacant does not lie.

Plaintiff's claim that the Surrender Agreement established the legal surrender date is insufficient to raise a triable issue of fact because plaintiff has failed to come forward with proof that defendant intended to waive its defenses as to plaintiff's claim for use and occupancy.

Since plaintiff has failed to raise a triable issue of fact, the cross-motion must be granted to the extent that the first and second causes of action are hereby severed and dismissed.

As for the third cause of action, defendant has not established entitlement to dismissal of this claim. Defendant's arguments concerning "additional charges" only concern those charges which plaintiff claims accrued on or after June 1, 2011.

Finally, plaintiff's fourth cause of action for attorneys fees must be severed and dismissed because the sole remaining cause of action does not arise from the parties rights or obligations under the Surrender Agreement.

Accordingly, the cross-motion is granted only to the extent that the first, second and [*6]fourth causes of action are hereby severed and dismissed. The cross-motion is otherwise denied.

In accordance herewith, it is hereby:

ORDERED that plaintiff's motion for summary judgment on the issue of liability is denied; and it is further

ORDERED that the City's cross-motion for summary judgment is granted only to the extent that the first, second and fourth causes of action are hereby severed and dismissed; and it is further

ORDERED that the cross-motion is otherwise denied; and it is further

ORDERED that the first, second and fourth causes of action are hereby severed and dismissed.

Any requested relief not expressly addressed herein has nonetheless been considered and is hereby expressly denied and this constitutes the decision/order of the Court.