The following e-filed documents, listed by NYSCEF document number (Motion 001) 17, 18, 19, 20, 21, 22, 23, 24, 56, 57, 60, 61, 64, 65, 68, 71, 72, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 98, 100, 102 were read on this motion for DISMISSAL.

In this action, residents of a co-op apartment unit have sued the co-op, its management company, and its board of managers for allegedly releasing into their unit harmful chemical substances that ultimately forced them to vacate.

Plaintiffs, Jessica Biales and Dennis Biales, are the owners of the stock and proprietary [*2]lessees for apartment 6J in the building located at 10 East End Avenue in Manhattan. (NYSCEF No. 14 at ¶ 1.) The building is owned by defendant 10 East End Avenue Owners, Inc., and managed by defendant Wallack Management Company, Inc.

Defendants are the co-op, the management company, the co-op board of managers, and several individual board members.

Plaintiffs' complaint asserts seven causes of action: (1) breach of contract against the co-op only, (2) breach of warranty of habitability against the co-op only, (3) constructive eviction, (4) negligence, (5) breach of fiduciary duty against the board and individual board members only, (6) fraud, and (7) attorney fees. (NYSCEF No. 14 at ¶¶ 44-77.)

On motion sequences 001 and 002, different groups of defendants (represented by the same counsel) move separately to dismiss the claims against them. Plaintiffs cross-move on both 001 and 002 for retroactive extensions of their time to serve the summons and complaint on defendants.

On this motion, the co-op and the management company move under CPLR 3211 to dismiss the claims against them. These defendants argue that (i) plaintiffs did not timely serve them; (ii) plaintiffs' negligence and constructive-eviction claims against them are time-barred; and (iii) plaintiffs' fraud and attorney-fee claims fail to state a cause of action. Plaintiffs cross-move to extend time to serve the summons and complaint on defendants, nunc pro tunc, under CPLR 306-b.

1. Service

Under CPLR 306-b, service must be made within 120 days of the commencement of an action. Plaintiffs filed their summons with notice on September 21, 2023, but did not serve the co-op and the management company until February 26, 2024—158 days after commencement. Plaintiffs contend that service was nonetheless timely because it was made within 120 days of the filing of plaintiffs' amended summons with notice. This court disagrees.

CPLR 306-b provides that service shall be made within 120 days "after the commencement of the action." An action is commenced by the filing of a summons with notice (or summons and complaint). That an amended summons or amended complaint supersedes the original pleading does not mean that the action has somehow been "re-commenced" for service purposes.

Appellate Division precedent bolsters this inference from the statutory text. In Cracolici v Shah, the Appellate Division, First Department, held that although the plaintiff had not served his initial complaint on a defendant, service of the (properly amended) complaint on the defendant "within 120 days of the filing of the action" was timely for purposes of CPLR 306-b. (127 AD3d 413, 414 [1st Dept 2015].) Similarly, in Schroeder v Good Samaritan Hospital, the Appellate Division, Second Department, held that when a "summons and complaint are timely filed but not served," service of a properly amended pleading "during the 120-day period when service of the original pleadings was required under CPLR 306-b" is sufficient. (80 AD3d 744, 746 [2d Dept 2011].) Were plaintiffs correct that filing of an amended complaint resets CPLR 306-b's 120-day deadline, there would have been no need for these decisions to specify that service of the amended complaints at issue had been made within 120 days of the filing of the initial complaint.

Plaintiffs also cross-move, though, for a retroactive extension of time to serve the [*3]amended summons with notice. This court agrees that the requested extension is warranted.

CPLR 306-b permits a retroactive extension of service "in the interest of justice." (Beras v Alan Rena Realty Corp., 190 AD3d 478, 479 [1st Dept 2021].) In considering whether to grant a requested extension, a court "may consider diligence, or lack thereof, along with any other relevant factor in making its determination, including expiration of the Statute of Limitations, the meritorious nature of the cause of action, the length of delay in service, the promptness of a plaintiffs' request for the extension of time, and prejudice to defendant." (Nunez-Ariza v Nell, 161 AD3d 614, 614 [1st Dept 2018].)

Here, plaintiffs represent that they served defendants late because (prior) counsel had believed that the 120-day period ran from filing of their amended summons with notice, not the original notice. This excuse is not especially strong. And plaintiffs did not seek the extension until after defendants moved to dismiss. On the other hand, the statute of limitations has expired for at least some of plaintiffs' claims against these defendants; the delay in service was only 38 days; and defendants were not prejudiced by this brief delay; they were undisputedly aware of the commencement of this action.

In these circumstances, plaintiffs' cross-motion for a retroactive extension of time to serve the co-op and the management company is granted.

2. Statute of Limitations

The co-op and management company seek dismissal of plaintiffs' negligence and constructive-eviction claims as time-barred. This request is denied.

Negligence. Negligence claims are subject to a three-year statute of limitations. Defendants contend—and plaintiffs do not dispute for purposes of this motion—that the claim accrued no later than September 23, 2020, when a significant flood caused plaintiffs to vacate the apartment. Plaintiffs commenced this action by filing the summons with notice on September 21, 2023, within three years of accrual.

Defendants nonetheless argue that the negligence claims are untimely because plaintiffs did not serve the summons with notice within the statute of limitations. But under New York's commencement-by-filing system, a claim is "interposed against the defendant" for limitations purposes "when the action is commenced"—i.e., upon filing, not service. (See CPLR 203 [a], [c].) The cases on which defendants rely address the relationship between service and timeliness in the context of resolving CPLR 306-b motions for retroactive extensions of time to serve, not CPLR 3211 (a) (5) motions to dismiss.

Constructive Eviction. The First Department has held that "a cause of action for constructive eviction is governed by a one year statute of limitations." (Kent v 534 E. 11th St., 80 AD3d 106, 110-112 [1st Dept 2010].) Plaintiffs allege that they were constructively evicted due to the September 23, 2020, flood, which exacerbated the existing water-intrusion and mold-based problems in the apartment. But plaintiffs did not bring this action until September 21, 2023.

Plaintiffs argue that the one-year limitations period was tolled because the co-op and the management company's failure to address the leaks causing water (and mold) intrusion into the apartment constituted a continuing wrong. This court agrees that plaintiffs have established, for pleading purposes, that these defendants' alleged conduct was a continuing wrong. (See King v 870 Riverside Drive Housing Dev. Fund Corp., 74 AD3d 494, 496-497 [1st Dept 2010] [holding that plaintiff's constructive-eviction damages claim based on "the coop's alleged failure, in violation of the proprietary lease, to repair the continuing leaks" was not time-barred because [*4]that failure constituted a continuing wrong, but that "recovery of monetary damages is limited by CPLR 214 (4) to any alleged damage that occurred within three years of the commencement of the instant action"], citing Kaymakcian v Board of Mgrs. of the Charles House Condominium, 49 AD3d 407, 407-408 [1st Dept 2008].)

Defendants rely on the First Department's decision in Kent v 534 E. 11th St. But in that case, plaintiff moved out of her apartment in November 2006 based on environmental contamination, discovered then, that had occurred in 2002 due to construction work. (See 80 AD3d 106, 110-112 [1st Dept 2010]). In other words, plaintiff's constructive-eviction claim in Kent was not based on a continuing wrong, but on the alleged continuing effects of a past completed wrong. The Court's ruling that the claim was untimely is inapposite here.

3. Failure to State a Cause of Action

Fraud. The co-op and the management company move to dismiss plaintiffs' fraud claims under CPLR 3211 (a) (7). They argue that plaintiffs have not alleged the involvement of different defendants in the fraud with sufficient specificity; that plaintiffs have not adequately alleged reliance; and that in any event the fraud is duplicative of plaintiffs' breach-of-contract claim. These arguments are unpersuasive.

Plaintiffs have sufficiently alleged misrepresentations by defendants. Plaintiffs need not at this early stage of the action isolate and specify each defendant's particular involvement in (and liability for) the alleged fraudulent misrepresentations.

With respect to reliance, plaintiffs have adequately alleged that they relied on defendants' assertedly false representations that (i) they were addressing the water-leak related problems, and (ii) those leaks had not led to infiltration of mold and other environmental toxins into the apartment. Defendants argue that plaintiffs could have conducted their own testing for mold and other toxins, rather than taking defendants' word for it. But defendants have not shown at the pleading stage that it was unreasonable for plaintiffs to have relied on defendants' greater experience and expertise in this area.

This court also disagrees with defendants about whether plaintiffs' fraud claim necessarily duplicates plaintiffs' contract claim. The contract claim seeks damages for defendants' alleged failure, in essence, to repair the apartment properly, remediate the water and mold intrusions, and comply with the covenant of quiet enjoyment. The fraud claim does not seek damages for defendants' alleged misrepresentations that they would perform these contractual obligations, but rather for alleged misrepresentations by defendants about the condition of the apartment and about what remediation measures they were undertaking in the apartment—"misrepresentation[s] of present facts," not those of "future intent to perform." (IS Chrystie Mgt. LLC v ADP, LLC, 205 AD3d 418, 418 [1st Dept 2022].)

Attorney Fees. This court agrees with defendants that plaintiffs' cause of action for attorney fees under Real Property Law § 234 is subject to dismissal as against all defendants. Plaintiffs may seek attorney fees as an increment of their claimed damages. But a claimed entitlement to attorney fees will not support a separate, independent cause of action against any defendant in this action. (See e.g. La Porta v Alacra, Inc., 142 AD3d 851, 853 [1st Dept 2016].)

On this motion, the co-op board and the individual board members seek to dismiss all of plaintiffs' claims against them. Movants on motion sequence 002 reprise the co-op and the management company's arguments with respect to service, the statute of limitations for negligence and constructive eviction, and the failure to state claims for fraud and attorney fees. [*5]Movants also challenge the validity of service on the board members; argue that the board is not a proper defendant; contend that the fiduciary-duty claims against movants are time-barred; and that plaintiffs' constructive-eviction and fiduciary-duty claims fail to state a cause of action.

1. Service.

Defendants move to dismiss all of plaintiffs' claims against both the board and the board members because service was both untimely and improper against the board members in any event. Plaintiffs cross-move for an extension of time to serve under CPLR 306-b to the extent it is necessary.

With respect to the board, service was not untimely. The board was not named in the initial or amended summons with notice. Rather, the board was named as an additional defendant in a supplemental summons served and filed with the complaint. The addition of the board as a defendant without leave of court was permissible under CPLR 1003. And plaintiffs promptly served the board after naming it as a defendant in the complaint.

With respect to the individual board members, the court agrees with defendants that service was both untimely and invalid. But for the reasons discussed on motion sequence 001, the court grants plaintiffs' cross-motion under CPLR 306-b for a retroactive extension of time to serve.

2. Improper Defendant

Defendants, relying on this court's decision in Stromberg v East River Housing Corp. (82 Misc 3d 871, 883-884 [Sup Ct, NY County 2023]), argue that plaintiffs' claims against the board must be dismissed because the board is not a proper party defendant. This court agrees.

Plaintiffs argue that "the First Department has repeatedly held that a co-op board, separate and apart from a co-op corporation, can be sued by shareholders of the co-op." (NYSCEF No. 89 at ¶¶ 25-26, citing Fuisz v 6 E. 72nd St. Corp., 222 AD3d 402, 405 [1st Dept 2023]; Dau v. 16 Sutton Place Apt. Corp., 205 AD3d 533, 535-36 [1st Dept 2022].) But as this court explained in Stromberg, the First Department decision in Fuisz is inapposite: The co-op board in that case did not contend it was an improper/unsuable defendant. The First Department did not consider, or have occasion to consider, whether the co-op board could properly be sued. (See Stromberg, 82 Misc 3d at 884, citing Fuisz, 222 AD3d 402.) The record in Dau reflects that the same was true there, as well. And the Appellate Division has not considered (or addressed) this issue since Stromberg was issued, either.

Plaintiffs' claims against the co-op board are therefore dismissed.

3. Statute of Limitations

Defendants move to dismiss plaintiffs' negligence, constructive-eviction, and breach-of-fiduciary-duty claims under CPLR 3211 (a) (5). Defendants' arguments in support of this branch of their motion mirror the statute-of-limitations arguments made by the co-op and the management company defendants on motion sequence 001, discussed earlier, and fail for the same reasons.

4. Failure to State a Cause of Action

Constructive Eviction. Defendants argue that the individual board members cannot be held liable for constructive eviction, on the ground that they are not parties to the lease and thus did not have a landlord-tenant relationship with plaintiffs—a necessary element of a constructive-eviction claim. (See 7001 E. 71st St., LLC v Millennium Health Servs., 138 AD3d 573, 573-574 [1st Dept 2016].) Plaintiffs argue in opposition that they may nonetheless sue the individual board members for aiding and abetting the co-op's constructive-eviction conduct. This [*6]court disagrees. Plaintiffs provide no authority for the proposition that a cause of action exists for aiding and abetting a constructive eviction. Nor would such a cause of action make sense: Constructive-eviction claims are based on a breach of the covenant of quiet enjoyment, which is a liability theory sounding in contract, not tort. And there is "no cause of action for aiding and abetting a breach of contract." (Pomerance v McGrath, 124 AD3d 481, 484 [1st Dept 2015].)

Negligence. Defendants argue that plaintiffs' negligence claims against the individual board members should be dismissed for (assertedly) failing to allege the existence of a duty that these defendants breached. This argument is unpersuasive. Defendants do not dispute that under Business Corporation Law § 717, corporate directors, such as members of a co-op board, must act with due care. Instead, they claim that this cause of action must be dismissed for failure to allege that duty in the complaint. But the complaint pleads facts that, taken as true, support the existence, and breach, of a BCL § 717 duty of care owed by the individual board members. Plaintiffs are not required also to plead the legal theory why that duty would exist on the facts as alleged.

Breach of Fiduciary Duty. The individual board members move to dismiss plaintiffs' claims against them for breach of fiduciary duty. This branch of the motion is denied. Defendants do not dispute that the complaint alleges conduct by the members of the board that would, at a minimum, constitute participation in alleged tortious conduct by the co-op. Instead, they argue that the complaint does not allege "specific acts" of wrongdoing "by specific directors"—i.e., that it does not sufficiently identify which board member did what. The court concludes that this level of specificity is not required for pleading purposes, particularly given that plaintiffs lack access at this stage to many of the documents and other information that would show the involvement and conduct of board members that underlies plaintiffs' fiduciary-duty claims.

Fraud. The individual board members also argue that plaintiffs' fraud allegations against them are insufficiently detailed and specific. For the reasons given with respect to breach of fiduciary duty, and with respect to the fraud claim asserted against the co-op and the management company discussed earlier, this court disagrees.

Accordingly, it is

ORDERED that plaintiffs' cross-motion to extend retroactively their time to serve the summons and complaint on the co-op and the management company (mot seq 001) is granted; and it is further

ORDERED that the branch of the co-op/management company's motion seeking dismissal of plaintiffs' claim against it for attorney fees (mot seq 001) is granted; and it is further

ORDERED that the branches of the co-op/management company's motion seeking dismissal of plaintiffs' other claims against them (mot seq 001) are denied; and it is further

ORDERED that plaintiffs' cross-motion to extend retroactively their time to serve the summons and complaint on the co-op board and the individual board members (mot seq 002) is granted; and it is further

ORDERED that the board's motion to dismiss plaintiffs' claims against it (mot seq 002) is granted; and it is further

ORDERED that the branches of the individual board members' motion seeking dismissal of plaintiffs' claims against them for attorney fees and for constructive eviction (mot seq 002) are granted; and it is further

ORDERED that the branches of the individual board members' motion seeking dismissal [*7]of plaintiffs' other claims against them (mot seq 002) are denied; and it is further

ORDERED that the co-op, the management company, and the individual board members shall answer the complaint within 20 days of service on them of a copy of this order with notice of its entry; and it is further

ORDERED that the parties shall appear before this court for a telephonic preliminary conference on February 14, 2025.