Imagine winning litigation after being a defendant in a contract dispute and then having the plaintiff start another suit arising out of the same contract but on a different theory. That is essentially the issue that Weiss Zarett faced recently in its appeal to the Appellate Division Second Department. The matter in question arose from two cases in the Supreme Court Nassau County. In the first case, the plaintiff sought to foreclose on a mortgage arising out of a joint- venture agreement. Weiss Zarett represented the new owner of the commercial real property in question, which it purchased after the foreclosure litigation had commenced. Weiss Zarett successfully intervened for the new owner in the pending foreclosure action and asserted a counterclaim to quiet title. Ultimately, on appeal, the underlying foreclosure action was dismissed, and a judgment was entered in favor of the new owner cancelling and discharging the mortgage of record. Immediately thereafter, plaintiff again sued the same joint-venture parties under the same joint- venture agreement and added the new owner as a defendant, asserting that it tortiously interfered with the joint venture agreement. The new case was assigned to a different Supreme Court Justice. Weiss Zarett moved to dismiss the case as to the new owner, on the grounds (among others) that the plaintiff could not split its causes of action and was barred from asserting claims it could have asserted in the first action. The Supreme Court denied the motion to dismiss. On appeal, the Appellate Division, Second Department, reversed and dismissed the case as to Weiss Zarett’s client, effectively reminding parties that they can’t have two bites at the apple!
Should you need the assistance of skilled and experienced counsel to assist you in litigation arising from commercial real estate transactions, do not hesitate to contact Michael D. Brofman, Esq. at firstname.lastname@example.org and Michael J. Spithogiannis at email@example.com.