J&R Broadway, LLC v 1165 Fresh Produce Corp.

Supreme Court, Appellate Term, Second Department, 2d, 11th And 13th Judicial Districts

Decided on February 27, 2026

2025-42 K C

Present: : Lisa S. Ottley, J.P., Wavny Toussaint, Marina Cora Mundy, JJ

Kaplan Levenson, P.C. (Steven M. Kaplan of counsel), for nonparty-appellant.

The Luke Law Firm (Meyer Y. Silber of counsel), for respondents.

Appeal from an order of the Civil Court of the City of New York, Kings County (Babatunde I. Akowe, J.), entered December 6, 2024. The order, insofar as appealed from as limited by the brief, denied the branch of a motion by Grocery Leasing Corp. seeking leave to intervene, pursuant to CPLR 1012, in a commercial holdover summary proceeding.

ORDERED that the order, insofar as appealed from, is reversed, without costs, and the branch of the motion by Grocery Leasing Corp. seeking leave to intervene is granted.

Landlords commenced this holdover summary proceeding based on a claim that they had terminated a month-to-month tenancy of a commercial space operating a supermarket in Brooklyn, and sought $344,302.98 in past due rent. Subsequently, nonparty Grocery Leasing Corp. (GLC) moved, insofar as relevant to this appeal, for leave to intervene in the proceeding, pursuant to CPLR 1012. A copy of a lease between landlord's predecessor and 1165 Fresh Produce Corp. (tenant) commencing March 1, 2015 and ending February 28, 2022, with options to renew through February 28, 2037, was attached to the motion. In support of the motion, GLC's vice president alleged that, [*2]in exchange for GLC providing tenant with credit to stock its shelves with food, tenant, GLC, and landlords' predecessor signed a collateral assignment of lease (CAOL) requiring landlords' predecessor to provide GLC with notice of any default by tenant in order to "give GLC the opportunity to assume the lease, cure certain defaults thereunder and install a replacement supermarket operator." The CAOL also required tenant to notify GLC of any renewals or election not to exercise a renewal period, and GLC had the right to exercise all renewal options in the lease. GLC's vice president stated that the CAOL provided that it was binding upon successor landlords. The CAOL was annexed to the motion papers. Landlords opposed the motion, asserting that they had no knowledge of the 2015 lease or the CAOL and that those documents had not been provided to them by landlords' predecessor during the sales transaction or closing. In an order entered December 6, 2024, insofar as appealed from as limited by the brief, the Civil Court (Babatunde I. Akowe, J.) denied the branch of GLC's motion seeking leave to intervene, finding that GLC had not submitted sufficient evidence demonstrating a relationship between GLC and landlords, or that landlords had assumed the CAOL.

As relevant here, a party may intervene "when the action involves the disposition or distribution of . . . property and the person may be affected adversely by the judgment" (CPLR 1012 [a] [3]; see JPMorgan Chase Bank, N.A. v Mule, 230 AD3d 1234, 1235 [2024]) or "where the intervenor has a real and substantial interest in the outcome of the proceedings" (Wells Fargo Bank, N.A. v McLean, 70 AD3d 676, 677 [2010]; see HSBC Bank USA, N.A. v Minogue, 202 AD3d 662, 663 [2022]). Allegations showing a "a real and substantial interest in the outcome of th[e] action and that it may be affected adversely by a judgment" are sufficient for courts to allow leave to intervene (Windward Bora, LLC v Home Funds Direct, 236 AD3d 975, 978 [2025]; see Global Team Vernon, LLC v Vernon Realty Holding, LLC, 93 AD3d 819 [2012]). The question of whether the CAOL or its term purporting to bind successor landlords is, in fact, binding upon landlords herein is not before this court on this appeal; rather, we are asked to determine whether GLC has made a sufficient showing to warrant intervention, and we find that it has.

GLC requests that this court transfer the proceeding to the Supreme Court, Kings County, and consolidate this matter with a declaratory judgment action that was commenced by GLC in that court subsequent to the December 6, 2024 entry of the order on appeal regarding GLC's rights to the premises. Such relief must be sought in the Supreme Court (see CPLR 325; Sirota v Sirota, 168 Misc 2d 123 [App Term, 2d Dept, 2d & 11th Jud Dists 1996]).

Accordingly, the order, insofar as appealed from, is reversed, and the branch of the motion by GLC seeking leave to intervene is granted.

OTTLEY, J.P., TOUSSAINT and MUNDY, JJ., concur.

ENTER:

Jennifer Chan

Chief Clerk

Decision Date: February 27, 2026