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By: Jeffrey M. Haber Contract interpretation principles require courts to give effect to the parties’ intent as expressed in the plain language of their agreement, while reading the contract as a whole and avoiding constructions that render provisions meaningless. Where contractual terms introduce discretion or conditional performance, such as provisions allowing one party to determine whether services will be requested, questions of ambiguity may arise concerning the scope of the parties’ obligations. In such circumstances, courts often consider whether the agreement reflects a performance-based bargain or a broader allocation of risk and responsibility. These principles are illustrated in Prosight Specialty Mgt. Co., Inc. v. Altruis Group, LLC, 2026 N.Y. Slip Op. 03131 (1st Dept. May 19, 2026), a case concerning the interpretation of a services agreement and whether its discretionary language limited the provider’s obligations or affected its entitlement to compensation. Applicable Principles When interpreting contracts, a court’s “function is to apply the meaning intended by the parties, as derived from the language of the contract in question.”[1] For this reason, a “written agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms.”[2] “When the parties have a dispute over the meaning, the court first asks if the contract contains any ambiguity, which is a legal matter for the court to decide.”[3] Whether there is an ambiguity “is determined by looking within the four corners of the document, not to outside sources.”[4] However, courts may “examine the entire contract and consider the relation of the parties and the circumstances under which it was executed” in determining whether an agreement is ambiguous.[5] “A contract is unambiguous if, on its face, it is reasonably susceptible of only one meaning.”[6] “To the extent that any of [an] agreement’s terms may be ambiguous, indefinite or uncertain, it is well settled that extrinsic or parol evidence is admissible to determine their meaning.”[7] Moreover, “[c]ontracts must be read as a whole and all terms of a contract must be harmonized whenever reasonably possible.”[8] “An interpretation that gives effect to all the terms of an agreement is preferable to one that ignores terms or accords them an unreasonable interpretation.”[9] Thus, courts “must examine the parties’ obligations and intentions as manifested in the entire agreement and seek to afford the language an interpretation that is sensible, practical, fair and reasonable.”[10] The courts should not, however, “rewrite the plain contractual language in an effort to right some perceived inequity in the parties’ bargain.”[11] Against the foregoing principles of contract interpretation, we examine Prosight Specialty Mgt. Co., Inc. v. Altruis Group, LLC. Prosight Specialty Mgt. Co., Inc. v. Altruis Group, LLC Prosight concerned a contract dispute between defendant, Altruis Group, LLC, and plaintiff, ProSight Specialty Insurance Company, Inc.; namely, whether defendant fulfilled its contractual obligations under a Niche Management Agreement (“NMA”) with plaintiff, and was entitled to commissions for services performed in 2021.[12] The parties entered into the NMA on February 4, 2020. Pursuant to the NMA, defendant agreed to serve as a managing general agent and provide services supporting plaintiff’s captive insurance business, including soliciting business and performing specified “Minimum Services.” The NMA appointed defendant as plaintiff’s niche administrator and authorized representative to act on plaintiff’s behalf in performing such services. The agreement applied on a calendar-year basis and was set to expire on December 31, 2021. On May 4, 2020, the parties executed an amendment to the NMA (“NMA Amendment”). Among other things, the amendment added a provision that, at plaintiff’s sole discretion, required defendant to perform “some, all or none” of the identified Minimum Services with respect to captive transactions. During 2020, defendant performed services requested by plaintiff, including sourcing captive business opportunities and supporting collateral management and reporting functions. In connection with defendant’s performance, plaintiff paid defendant commissions consistent with the terms of the NMA. In 2021, defendant continued to provide services in support of plaintiff’s captive program in response to requests from plaintiff. According to defendant, it performed all services requested of it, consistent with the NMA Amendment, which made the performance of Minimum Services contingent on plaintiff’s requests. Plaintiff, by contrast, contended that defendant failed to perform certain Minimum Services and did not develop the full range of capabilities contemplated by the agreement. By September 2021, plaintiff decided to exit the captive insurance business, although defendant continued to perform services and engage in business development activities through the fourth quarter of 2021. On November 15, 2021, plaintiff issued notice purporting to terminate the NMA for alleged material breach, asserting that defendant failed to provide certain Minimum Services required under the NMA Amendment. Defendant disputed the alleged breach and termination, maintaining that it performed all services requested by plaintiff and that, under the NMA Amendment, it was not required to perform services that plaintiff did not request. Defendant further contended that plaintiff failed to comply with the NMA’s contractual termination provisions, including the requirement to provide notice and an opportunity to cure any alleged breach. Plaintiff maintained its position that defendant failed to satisfy its contractual obligations and that full commission payments were not owed. Plaintiff moved for summary judgment on its breach of contract and declaratory judgment claims and on defendant’s counterclaim for breach of contract. The motion court denied plaintiff’s motion. The Appellate Division, First Department, unanimously affirmed. The First Department’s Decision The Court held that the motion court correctly “found that the contractual language at issue was ambiguous” and, therefore, “properly considered extrinsic evidence to interpret its meaning.”[13] The Court explained that, while the first sentence of the relevant contractual provision both authorized and required defendant to perform “all” of the specified Minimum Services under the NMA and the NMA Amendment, the second sentence provided that, at plaintiffs’ sole discretion, defendant would perform “some, all, or none” of those services.[14] Read together, said the Court, those provisions created ambiguity as to which, if any, of the Minimum Services defendant was obligated to perform absent a specific request from plaintiffs.[15] The Court also noted that “[d]eposition testimony and other evidence bolstered defendant’s interpretation that under the NMA Amendment, defendant was obligated to perform any of the delineated Minimum Services for a ‘captive insurance customer’ (Captive) when specifically requested to do so by plaintiffs, as plaintiffs were exploring and developing their Captive business.”[16] “Given the parties’ obligations and intentions,” concluded the Court, “defendant’s interpretation was ‘sensible, practical, fair, and reasonable.’”[17] Takeaway Prosight highlights three principal lessons regarding contract interpretation and the allocation of performance obligations. First, it underscores that ambiguity can arise even in seemingly straightforward contractual language when provisions conflict or introduce discretion. In Prosight, the juxtaposition of a clause requiring defendant to perform “all” Minimum Services with another permitting performance of “some, all, or none” of the Minimum Services created an internal inconsistency. When read as a whole, the agreement failed to clearly define defendant’s obligations, illustrating that ambiguity is not limited to vague terms but may emerge from competing obligations within the same provision. Second, Prosight emphasizes that courts will consider extrinsic evidence once ambiguity is found and may adopt the interpretation that best reflects a practical and commercially reasonable understanding of the parties’ relationship. In Prosight, deposition testimony and course-of-performance evidence supported defendant’s position that its duties were contingent on plaintiff’s requests. The Court favored this interpretation because, among other reasons, it aligned with how the parties actually conducted themselves. Third, Prosight demonstrates that discretionary performance provisions can affect entitlement to compensation, particularly where compensation is tied to the services performed. By making the performance of “Minimum Services” dependent on plaintiff’s election, the NMA and its amendment shifted control over both performance and payment. As a result, disputes over whether services were required, and whether they were adequately performed, raised factual issues that precluded summary judgment. __________________________________ Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes only and is not intended to be, and should not be, taken as legal advice. Unless otherwise stated, Freiberger Haber LLP’s articles are based on recently decided published opinions or litigation releases and not on matters handled by the firm. ___________________________________ [1] Duane Reade, Inc. v. Cardtronics, LP, 54 A.D.3d 137, 140 (1st Dept. 2008) (citation omitted). [2] Id., quoting Greenfield v. Philles Records, 98 N.Y.2d 562, 569 (2002)). [3] MPEG LA, LLC v. Samsung Elecs. Co., 166 A.D.3d 13, 17 (1st Dept. 2018), lv. denied, 32 N.Y.3d 912 (2018), citing Ashwood Capital, Inc. v. OTG Mgt., Inc., 99 A.D.3d 1, 7-8 (1st Dept. 2012). [4] Id., 166 A.D.3d at 17, quoting Kass v. Kass, 91 N.Y.2d 554, 566 (1998). [5] Kass, 91 N.Y.2d at 566; see also W.W.W. Assoc. v. Giancontieri, 77 N.Y.2d 157, 162 (1990). [6] B.D. v. E.D., 218 A.D.3d 9, 14-15 (1st Dept. 2023) (citations omitted); see also Breed v. Insurance Co. of N. Am., 46 N.Y.2d 351, 355 (1978) (a contract is unambiguous if the language has “a definite and precise meaning, unattended by danger of misconception in the purport of the [agreement] itself, and concerning which there is no reasonable basis for a difference of opinion”); Broad St., LLC v. Gulf Ins. Co., 37 A.D.3d 126, 131 (1st Dept. 2006) (citations omitted).. [7] Korff v. Corbett, 18 A.D.3d 248, 251 (1st Dept. 2005); see also W.W.W. Assoc., 77 N.Y.2d at 162. [8] Teliman Holding Corp. v. VCW Assoc., 211 A.D.3d 499, 500 (1st Dept. 2022). [9] Perlbinder v. Bd. of Managers of 411 E. 53rd St. Condo., 65 A.D.3d 985, 986-987 (1st Dept. 2009). [10] MPEG, 166 A.D.3d at 17 (citations omitted); see also Duane Reade, 54 A.D.3d at 140. [11] B.D., 218 A.D.3d at 18, citing Greenfield, 98 N.Y.2d at 570 (“a court is not free to alter the contract to reflect its personal notions of fairness and equity”). [12] The discussion of the facts of Prosight comes from the briefing on appeal. [13] Slip Op. at *1, citing Nova Cas. Co. v. Peter Thomas Roth Labs, LLC, 178 A.D.3d 468, 468 (1st Dept. 2019). [14] Id. [15] Id. (“Taking both sentences together, it is unclear which—some, all, or none—of the Minimum Services defendant was to provide, unless specifically requested to do so by plaintiffs.”) [16] Id. [17] Id., citing MPEG, 166 A.D.3d at 17.

By: Jeffrey M. Haber In today’s article, we examine Kingdom Assoc., Inc. v. WBC Servs. Inc., 2026 N.Y. Slip Op. 03070 (1st Dept. May 14, 2026), a case arising from a proposed subcontract for excavation and foundation work on a New York City project. Plaintiff alleged that defendant accepted its $8.28 million proposal and that it procured materials, obtained insurance, and prepared shop drawings in reliance thereon. Defendant argued that no binding contract existed because the proposal was never executed and required owner approval. After defendant stated the owner had not authorized the work, plaintiff filed a $1.075 million lien and sued. The Appellate Division, First Department held that plaintiff adequately stated claims for, among others, breach of contract and promissory estoppel, reversing the motion court’s dismissal of the causes of action. Kingdom Assoc., Inc. v. WBC Servs. Inc. Kingdom Associates arose from a proposed subcontract for excavation and foundation work at a New York City project.[1] Plaintiff alleged that defendant accepted its $8.28 million proposal in July 2024, creating a binding agreement, and that plaintiff began performance by procuring materials, obtaining insurance, and preparing shop drawings. Defendant maintained that no contract was formed because the proposal was never formally executed and required owner approval. Plaintiff alleged that defendant breached the contract and, alternatively, repudiated a clear promise on which it reasonably relied, causing damages of $1.075 million. The dispute began in April 2024, when plaintiff solicited bids for a portion of the project, including excavation, waterproofing, and foundation concrete. In response, defendant submitted a proposal and engaged in a series of email communications with plaintiff throughout July 2024. During these exchanges, the parties discussed project specifications, including drawings and scope changes. Plaintiff submitted a revised proposal on July 18, 2024, incorporating updated plans. That same day, defendant requested further details in the form of an itemized breakdown and also asked whether plaintiff could lower its price by $100,000. Plaintiff agreed and, shortly thereafter, submitted a revised proposal to defendant. On August 16, 2024, nearly a month after the final proposal was submitted, defendant informed plaintiff that the project owner had not authorized it to award the subcontract work and was still evaluating its options. Defendant thus took the position that no subcontract could be awarded at that time. Plaintiff argued that this communication was a unilateral termination of the agreement. It maintained that defendant never indicated during negotiations that owner approval was a prerequisite to contract formation and that it had already undertaken significant efforts in reliance on defendant’s representations. Thereafter, on August 23, 2024, plaintiff filed a mechanic’s lien against the project in the amount of $1,075,000. The lien was based on several categories of alleged costs, including insurance premiums, materials such as pipes and steel bars, shop drawings, and preconstruction services. Plaintiff subsequently commenced the action, asserting multiple causes of action. Those included: breach of contract, on the theory that an agreement existed and was wrongfully terminated; quantum meruit, seeking recovery for the value of services provided; promissory estoppel, based on alleged reliance on a clear promise of award; and unjust enrichment, alleging that the contractor benefited from plaintiff’s work without compensation. Defendant moved to dismiss. The motion court denied the motion. On appeal, the First Department reversed. The Court held that plaintiff stated a breach of contract claim.[2] To state a claim for breach of contract, a plaintiff must allege the “existence of a contract, the plaintiff's performance thereunder, the defendant’s breach thereof, and resulting damages.”[3] The Court found that plaintiff satisfied the elements of the claim by alleging that plaintiff: (1) “entered into an agreement with [defendant] to provide construction services,” (2) “performed under the agreement by providing labor and materials until [defendant] breached by unilaterally rescinding its agreement,” and (3) “suffered $1.075 million in expenses.”[4] Based on the foregoing, the Court concluded that “plaintiff stated the cause of action.”[5] The Court also held that plaintiff stated a claim for promissory estoppel.[6] “The elements of a claim for promissory estoppel are: (1) a promise that is sufficiently clear and unambiguous; (2) reasonable reliance on the promise by a party; and (3) injury caused by the reliance.”[7] The Court found that plaintiff satisfied the elements of the claim by pleading that: (1) “[defendant] made a clear and unambiguous promise that it was awarding the [subcontract] to” plaintiff; (2) “it was reasonable and foreseeable that [p]laintiff would rely on this unambiguous promise by [defendant] and commence work”; (3) “[defendant] violated its unambiguous promise to award the work” to plaintiff; and (4) “[d]ue to its detrimental reliance on [defendant’s] unambiguous promise, [p]laintiff [had] been damaged in the sum of [$1.075 million].”[8] The Court also noted that “[w]hile the email chain submitted by [defendant did] not contain a clear promise to award plaintiff the subcontract, it at least suggest[ed] the possibility that [defendant] made the promise to plaintiff in another manner.”[9] Based on the foregoing, the Court concluded that plaintiff stated a claim for promissory estoppel. Takeaway Kingdom Associates reaffirms the principle that, at the pleading stage, a plaintiff need not prove contract formation to survive dismissal. Allegations that the parties reached an agreement through negotiations, that performance began, and that the defendant repudiated the arrangement can suffice to state a breach of contract claim, even where there is no executed written agreement. Equally important, Kingdom Associates highlights the vitality of promissory estoppel as an alternative theory of liability. The Court recognized that a plaintiff’s allegations of a clear promise, coupled with reasonable reliance through performance, can support a claim for relief independent of a formal contract. In fact, the Court was willing to allow that a promise might be inferred from communications or proven through evidence beyond the written record. __________________________________ Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes only and is not intended to be, and should not be, taken as legal advice. Unless otherwise stated, Freiberger Haber LLP’s articles are based on recently decided published opinions or litigation releases and not on matters handled by the firm. ___________________________________ [1] The background facts and party assertions are taken from the briefing on appeal. [2] Slip Op. at *1. [3] Heijung Park v. Nam Yong Kim, 205 A.D.3d 429, 430 (1st Dept. 2022). [4] Slip Op. at *1. [5] Id. [6] Id. at *2. [7] Id. (quoting MatlinPatterson ATA Holdings LLC v. Federal Express Corp., 87 A.D.3d 836, 841-842 (1st Dept. 2011), lv. denied, 21 N.Y.3d 853 (2013)). [8] Id. (internal quotation marks omitted) [9] Id.

By: Jonathan H. Freiberger By way of brief background, and as set forth in one of our prior Blogs, Rule 3215(c) of the New York Civil Practice Law and Rules provides, in pertinent part, that: If the plaintiff fails to take proceedings for the entry of judgment within one year after the default, the court shall not enter judgment but shall dismiss the complaint as abandoned, without costs, upon its own initiative or on motion, unless sufficient cause is shown why the complaint should not be dismissed…. [Emphasis added.] Courts have noted that the language of CPLR 3215(c) is mandatory in the first instance unless plaintiff demonstrates “sufficient cause” for the failure to timely “take proceedings for the entry of [a default] judgment]”. See, e.g., U.S. Bank Trust N.A. v. Valle, 247 A.D.3d 1086, 1088 (2nd Dep’t 2026); Wells Fargo Bank v. Cafasso, 158 A.D.3d 848, 849 (2nd Dep’t 2018). The Cafasso Court (quoting Giglio v. NTIMP, Inc., 86 A.D.3d 301 (2nd Dep’t 2011)), noted that “sufficient cause” “‘requir[es] both a reasonable excuse for the delay in timely moving for a default judgment, plus a demonstration that the cause of action is potentially meritorious.’” Cafasso, 158 A.D.3d at 849; see also Valle, 247 A.D.3d at 1089; Wells Fargo Bank, N.A. v. Robinson-John, 220 A.D.3d 974, 977 (2nd Dep’t 2023). The “reasonableness” of an excuse is within the sound discretion of the motion court. See, e.g., US Bank, N.A v. Onuoha, 162 A.D.3d 1094, 1095–96 (2nd Dep’t 2018) (citations omitted); Cafasso, 158 A.D.3d at 849 (citations omitted). Finally, a default judgment need not be obtained within one year, as long as proceedings to obtain a default judgment that “manifest an intent not to abandon the case, but to seek a judgment” have been initiated. Citizens Bank, N.A. v. Abrams, 2026 WL 1236819 at *3 (2nd Dep’t May 6, 2026) (citations and internal quotation marks omitted); see also Bank of America, N.A. v. Bhola, 219 A.D.3d 430, 432 (2nd Dep’t 2023). In mortgage foreclosure actions, the preliminary step of moving for an order of reference is deemed to be a sufficient “proceeding” toward the entry of judgment to satisfy the one-year time frame of CPLR 3215(c). See, e.g., Deutsche Bank v. Delisser, 161 A.D.3d 942, 943 (2nd Dep’t 2018); Bank of Am., N.A. v. Lucido, 163 A.D.3d 614, 615 (2nd Dep’t 2018); Mort. Electronic Registration Systems, Inc. v. McVicar, 203 A.D.3d 915, 916-17 (2nd Dep’t 2022). In Citibank, N.A. v. Kerszko, 203 A.D.3d 42 (2nd Dep’t 2022), the Court answered in the affirmative, the “interesting” question of “whether the presentment to a court of a proposed ex parte order to show cause for an order of reference, which is rejected by the court for defects inherent in the papers, qualifies as a taking of proceedings for the entry of judgment pursuant to CPLR 3215(c), so as to avoid dismissal of the complaint as abandoned under that statute.” Kerszko, 203 A.D.3d at 43 – 44. In so doing, the Kerszko Court, provided a thoughtful analysis of, inter alia, what it means to “take proceedings” under CPLR 3215(c). The Second Department, in U.S. Bank N.A. v. Jerriho-Cadogan, 224 A.D.3d 788, 790 (2nd Dep’t 2024), held that the plaintiff took the necessary “proceedings” by filing an RJI seeking a foreclosure settlement conference within a foreclosure action as mandated by CPLR 3408 because a “settlement conference is a necessary prerequisite to obtaining a default judgment.” (Citations omitted.) On May 13, 2026, the Appellate Division, Second Department, decided U.S. Bank N. A. v. Islam, a mortgage foreclosure action decided under CPLR 3215(c). In 2012, the lender in Islam commenced a mortgage foreclosure action against the borrower, who failed to timely answer or otherwise appear in the action. Three years later, the lender moved for a default judgment and an order of reference. Shortly thereafter, the motion court granted the lender’s motion and referred the matter to a referee to compute the amounts due under the mortgage. Four years after that, in 2019, the motion court conditionally dismissed the action as abandoned. In 2021, the borrower moved to dismiss the complaint pursuant to CPLR 3215(c). The lender cross-moved to vacate the 2019 dismissal order and for a judgment of foreclosure and sale. The motion court denied the borrower’s motion and granted the lender’s cross-motion. On the borrower’s appeal the Second Department reversed. First, the Court found that the lender failed to “take proceedings for the entry of judgment within one year after the [borrower]'s default.” Like in Jerriho-Cadogan, the lender filed an RJI for a foreclosure settlement conference. However, the Court, finding the filing insufficient in this case, stated: Although the [lender] filed a request for judicial intervention requesting a foreclosure settlement conference within the one-year period after the defendant's default, a settlement conference was not required in this case because the defendant did not reside at the property subject to foreclosure (see CPLR 3408[a][1]). As such, the filing of the request for judicial intervention did not constitute the taking of proceedings for the entry of a judgment pursuant to CPLR 3215(c) and did not toll the one-year deadline to do so (see US Bank N.A. v Pane, [237 A.D.3d 1237, 1239 (2nd Dep’t 2025)]. [Hyperlinks added.] Finally, the Court, unmoved by the lender’s excuse for not taking timely proceedings for the entry of judgment, stated: Moreover, the [lender] failed demonstrate a reasonable excuse for its failure to timely take proceedings for the entry of judgment. Contrary to the [lender]'s contention, the [lender]'s change of attorney does not constitute a reasonable excuse for its delay in taking proceedings for the entry of judgment under these circumstances, and in any event, the change of attorney occurred after the statutory one year period expired. Since the [lender] failed to proffer a reasonable excuse for its delay, this Court need not consider whether the [lender] had a potentially meritorious cause of action. Jonathan H. Freiberger is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes and is not intended to be and should not be taken as legal advice.

By: Jeffrey M. Haber In Kellinger v. Fox Media LLC, 2025 N.Y. Slip Op. 33835(U) (Sup. Ct., N.Y. County Oct. 8, 2025) (here), the New York Supreme Court granted a motion brought by defendants to enforce a $15,000 settlement agreement with plaintiff. The motion court found that plaintiff had confirmed the settlement by email, satisfying CPLR 2104’s requirement for a written agreement. Although plaintiff later claimed he only agreed to review the documents, the motion court held that his email constituted a binding acceptance of the settlement. In New York, settlement agreements “are judicially favored, will not lightly be set aside,” and will be enforced “with rigor and without a searching examination into their substance.”[1] A court called upon to enforce a settlement must be satisfied that the agreement is “clear, final and the product of mutual accord.”[2] Thus, an out-of-court agreement settling an action is binding on each party to the agreement only if “it is in a writing subscribed by him or his attorney.”[3] “In addition, since settlement agreements are subject to the principles of contract law, for an enforceable agreement to exist, all material terms must be set forth” in that writing, “and there must be a manifestation of mutual assent.”[4] One of the first cases in New York to analyze whether emails satisfy the requirements of CPLR 2104 was Forcelli v. Gelco Corp. In Forcelli, the plaintiff sued the defendant for damages resulting from an automobile accident. Following discovery, the parties each moved for summary judgment. On the same day that the parties filed their motions, the parties appeared for mediation. Although a settlement was not reached at the mediation, the parties continued their discussions. In a subsequent phone conversation, the plaintiff’s counsel orally agreed to accept a settlement offer made by the insurance carrier’s adjuster. The adjuster memorialized the agreement to settle in an email to the plaintiff’s counsel. Under the agreement, the insurer agreed to pay $230,000 to the plaintiff in exchange for a release from the plaintiff. The plaintiff’s attorney was to prepare the settlement documentation. The adjuster “signed” the email as follows: “Thanks Brenda Greene.” On May 4, 2011, the plaintiff executed a release. One week later, the motion court granted the defendant’s cross-motion to dismiss the complaint. The same day, the defendant’s attorney served the order with notice of entry on the plaintiff, and the plaintiff’s counsel sent the release and a signed stipulation of discontinuance to the adjuster. The adjuster received the “settlement documents” and forwarded them to the defendant’s counsel, who promptly “rejected” the release and stipulation of discontinuance. The defendant’s attorney asserted that a “settlement [was never] consummated under CPLR 2104 between the parties” and that the defendant considered the matter dismissed by [the motion] court’s order resolving the cross-motion. The plaintiff moved to vacate the order dismissing the case, arguing that the adjuster’s email “constituted a binding written settlement agreement pursuant to CPLR 2104”.[5] The plaintiff opposed the motion, arguing there was a binding settlement. The motion court granted the plaintiff’s motion. On appeal, the Appellate Division, Second Department, affirmed. The Court found that the adjuster’s email set forth the material terms of the parties’ settlement. According to the Court, the parties entered a valid settlement agreement on May 11, 2011, even though the release was not fully executed.[6] The Court rejected the defendant’s argument that the settlement agreement was invalid because neither the defendant nor its counsel executed the release and draft stipulation, holding that the adjuster was an agent with apparent authority to settle the case.[7] As to the “subscription” requirement of CPLR 2104, the Court noted that while emails cannot be signed in the traditional sense, “the lack of ‘subscription’ in the form of a handwritten signature has not prevented other courts from concluding that an email message, which is otherwise valid as a stipulation between parties, can be enforced pursuant to CPLR 2104.”[8] The Court also recognized the “widespread use of email” and how “unreasonable” it would be to determine that, due to the absence of a traditional signature, an email could not conform to CPLR 2104. The Court further noted that the adjuster purposely added her name at the end of the e-mail and that it was not automatically generated by the email software.[9] The Appellate Division, First Department, has cited Forcelli with approval, finding it to be of persuasive value.[10] Against the foregoing, we examine Kellinger v. Fox Media LLC.[11] In Kellinger, the parties verbally agreed to settle the action for $15,000, which defendant’s counsel attempted to confirm via email dated November 17, 2023. In the email, counsel wrote: “We will prepare the settlement agreement/general release and hold harmless and send to you on this email chain. Can you please confirm for me that we have agreed to settle for $15,000?” Plaintiff responded, “Yes we have agreed on $15,000 and I am awaiting settlement documents. Jim.” On November 27, 2023, counsel emailed the proposed general release/settlement agreement and the hold harmless agreement. Neither party disputed that plaintiff did not return a signed executed copy of these documents. Defendants moved to enforce the purported written settlement agreement between them and plaintiff. Defendants argued that the November 27 email satisfied the legal requirements under CPLR 2104 and, therefore, constituted an enforceable agreement. The motion court granted the motion, finding that “plaintiff, in subscribing to the settlement offer in the email, ha[d] entered into an enforceable agreement.”[12] The motion court noted that plaintiff did not “deny that he sent the email that confirmed the material terms of a settlement for $15,000 in exchange for the ‘settlement agreement/general release and hold harmless [agreement].’”[13] Instead, plaintiff tried to walk back the agreement, claiming his email merely indicated a willingness to review the documents—not a final acceptance. The motion court rejected this attempt as an effort to “distort the plain, declarative meaning of plaintiff’s whole statement, which, as the full context of the email conversation reveal[ed], was to confirm, per counsel’s request, the oral agreement that had already been agreed to in previous discussions.”[14] “This is especially true,” said the motion court, “as plaintiff does not ever reject the terms of the release in his emails to defendants’ counsel.”[15] The motion court reasoned that “plaintiff’s post-hoc rationalization strain[ed] credulity: had he intended, plaintiff could have explicitly conditioned the settlement on ‘an examination’ of the release documents, or, if the release contained terms beyond those he believed he had agreed to, he could have rejected them immediately after receiving it.”[16] But, plaintiff had done none of the foregoing. “In other words,” said the motion court, “to the extent that plaintiff now relies on the confidentiality provision in the release as creating a material term to which he did not agree, plaintiff did not provide a credible explanation for his failure to expeditiously deny the existence of the settlement on this ground when the release was first sent to him in November of 2023.”[17] “As such,” concluded the motion court, “defendants [had] demonstrated that plaintiff agreed to the material terms of the settlement.”[18] Takeaway Kellinger reaffirms the principle that under CPLR 2104, a settlement agreement can be enforceable if it is in writing and subscribed by the party or their attorney—even if the agreement is made via email. The decision also reflects a strong judicial preference for enforcing settlements that appear clear and mutually agreed upon, even if not formally executed. In Kellinger, the motion court reiterated that once parties reach an agreement, even by email, courts should enforce it “with rigor,” provided the essential terms are clear, and there is mutual assent. ___________________________ Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes and is not intended to be and should not be taken as legal advice. [1] Forcelli v. Gelco Corp., 109 A.D.3d 244, 247-248 (2d Dept. 2013) (internal quotation marks omitted). [2] Id. [3] CPLR § 2014. CPLR 2104 provides, in relevant part that “An agreement between parties or their attorneys relating to any matter in an action, other than one made between counsel in open court, is not binding upon a party unless it is in a writing subscribed by him or his attorney or reduced to the form of an order and entered.” [4] Forcelli, 109 A.D.3d at 248 (internal quotation marks omitted). [5] Forcelli, 109 A.D.3d at 247. [6] Id. [7] Id. at 248 (citations omitted). [8] Id. [9] Id. at 251. [10] Jimenez v. Yanne, 152 A.D.3d 434, 434 (1st Dept. 2017) (finding email communications between counsel sufficiently set forth an enforceable agreement to settle the plaintiffs’ personal injury claims where plaintiffs’ counsel typed his name at the end of the email accepting the offer, thus satisfying CPLR 2104’s requirements); Matter of Phila. Ins. Indem. Co. v. Kendall, 197 A.D.3d 75, 79 (1st Dept. 2021). [11] This Blog previously examined emails and the subscription requirement of CPLR 2104 on numerous occasions. Some examples include: Second Department Reaffirms That E-mails Between Counsel Can Be Sufficient to Satisfy the Writing and Signature Requirement for Stipulations Pursuant to CPLR 2104; Did You Unintentionally Enter Into A Settlement Agreement by Email?; and Emails Following Mediation Sufficient to Confirm Settlement of Third-Party Contractual Indemnification Claim. To read additional articles in which we examined the enforceability of emails, please see the BLOG tile on our website and search for “email”, or any other commercial litigation issue that may be of interest you. [12] Slip Op. at *2 (citing Jimenez, 152 A.D.3d at 434). [13] Id. at *3. [14] Id. [15] Id. [16] Id. [17] Id. (citations omitted). [18] Id. at 3-4 (citation omitted).

By: Jonathan H. Freiberger Today’s article addresses 1995 Cam LLC v. West Side Advisors, LLC, a case decided on October 21, 2025, by the New York Court of Appeals. In 1995 Cam, the Court held that the guaranty executed by guarantor was a “good guy” guaranty and, therefore, liability under the subject commercial lease ended with the tenant’s surrender of possession of the premises and not with the landlord’s acceptance of the surrender. By way of background, a “good guy” guaranty is a type of guaranty frequently seen in conjunction with commercial leases. Such guarantees are typically executed by one or more owners of the tenant entity. “Under a standard ‘good guy guaranty,’ the guarantor is obligated to guarantee the lease payments until the tenant vacates and surrenders possession. This guaranty is so named because it is intended to induce the tenant to be a ‘good guy’ and leave the premises without undergoing the expense of eviction or removal of the tenant’s property.” 1995 Cam at Note 1 (citations and internal quotation marks omitted). Thus, the tenant, but not the “good guy” guarantor would be responsible for all rent due under the lease subsequent to the surrender. In 1995 Cam, the landlord and tenant entered into a commercial lease for office space in Manhattan. The initial lease was a standard form Real Estate Board of New York, Inc. (“REBNY”) lease with a rider. The lease was subsequently extended to, inter alia, include a limited personal guaranty from one of tenant’s officers, which was not a standard REBNY limited guaranty. Prior to the end of the lease term, tenant stopped paying rent and, on October 28, 2020, sent a letter to landlord advising of its intent to surrender the premises on November 30, 2020. On or about November 30, 2020, tenant vacated the premises and, after a walkthrough, delivered the keys to the premises to the building superintendent. The landlord commenced an action against tenant and guarantor to recover unpaid rent and expenses accruing both before and after the surrender of the premises. Ultimately, Supreme Court granted summary judgment to landlord. Tenant and guarantor appealed. The First Department affirmed, holding that “because the guaranty requires [tenant]'s surrender ‘pursuant to the terms of the Lease’ [tenant’s] failure to obtain [landlord]'s written acceptance of the surrender of the premises precluded [guarantor’s] avoidance of liability.” (Citations and internal quotation marks omitted.) The Court of Appeals granted leave for guarantor to appeal the judgment against it for post-vacatur damages. The Court framed the question presented as follows: “whether [guarantor]'s liability ends with [tenant]'s surrender of possession, or with [landlord]'s acceptance of surrender.” The Court’s analysis began with a discussion of general principles of contract construction. It noted that “[a] guaranty is subject to the ordinary principles of contract construction.” (Citations and internal quotation marks omitted.) Further, “[i]t is axiomatic that a contract is to be interpreted so as to give effect to the intention of the parties as expressed in the unequivocal language employed.” (Citations and internal quotation marks omitted.) In addition, “[i]n the absence of any ambiguity, we look solely to the language used by the parties to discern the contract's meaning.” (Citations and internal quotation marks omitted.) The Court noted that there was no claim of ambiguity with the lease. Specifically, as to the guaranty, the Court reiterated that such instruments are “to be interpreted in the strictest manner” and that: [i]mportantly, an interpretation that renders language in the guaranty superfluous is a view unsupportable under standard principles of contract interpretation. Accordingly, particular words should be considered, not as if isolated from the context, but in the light of the obligation as a whole and the intention of the parties as manifested thereby. Form should not prevail over substance and a sensible meaning of words should be sought. [Citations, internal quotation marks and brackets omitted.] The Court then quoted the operative provision of the guaranty: Guarantor guarantees that he shall pay to owner when due all Tenant's monetary obligations that have accrued under the terms of the Lease to the date that is the latest date that Tenant and its assigns, licensees and sublessees, if any, and shall have completely vacated and surrendered the Demised Premises to [Landlord] free and clear of any and all subtenants and/or occupants pursuant to the terms of the Lease (which date may be earlier than the stated expiration date in the Lease.) Tenant shall provide [Landlord] with not less than thirty (30) days prior notice of the date that it will be vacating and surrendering free and clear of any and all subtenants and other occupants. [Emphasis supplied; internal quotation marks, ellipses, brackets and footnote (noting that the “freely negotiated” guaranty is not a “standard” REBNY guaranty) omitted.] The Court recognized that while “surrender” is not defined in the guaranty, the REBNY lease contained two relevant provisions. The first (titled “End of Term”) provides that: Upon the expiration or other termination of the term of this Lease, Tenant shall quit and surrender to [Landlord] the Demised Premises, broom clean, in good order and condition, ordinary wear and damages which Tenant is not required to repair as provided elsewhere in this Lease excepted, and Tenant shall remove all its property. The second provision (titled “No Waiver”) provides that: No act or thing done by [Landlord] or [Landlord]'s agents during the term hereby demised shall be deemed an acceptance of a surrender of said premises, and no agreement to accept such surrender shall be valid unless in writing signed by [Landlord]. No employee of [Landlord] or [Landlord]'s agent shall have any power to accept the keys of said premises prior to the termination of the Lease and the delivery of keys to any such agent or employee shall not operate as a termination of the Lease or a surrender of the premises. In its opinion, the Court disagreed with the First Department’s reliance on the “No Waiver” provision to define “surrender”, which required a landlord’s acceptance. Doing so, according to the Court of Appeals, would “render most of the language in the guaranty superfluous.” In particular, the Court stated that the “language in the guaranty after ‘that have accrued under the terms of the Lease’ conditions [guarantor]'s liability on [landlord]'s actions. If [guarantor]'s liability were intended to be fully coterminous with that of [landlord]—that is, a full guaranty—all of the conditional language in the guaranty would be superfluous.” Conversely, the court found that the language in the “End of Term” provision of the REBNY lease would be more appropriately relied upon to define “surrender.” The Court stated: Relatedly, [the “End of Term” provision] of the REBNY Lease requires that at lease end, the tenant deliver the Premises vacant and broom clean. If the guaranty continued until the end of the Lease, there would be no need to reiterate the requirement that the Premises be delivered “completely vacant” in the guaranty. Inclusion of the “completely vacant” requirement in the guaranty becomes meaningful only if the guarantor's liability can end before the Lease ends, so that even when [the “End of Term” provision]'s “vacant and broom clean” requirement is not yet in effect (because the Lease has not ended), the “good guy” guaranty requires the premises be completely vacant at the earlier time as a condition of releasing the guarantor. [Footnote omitted.] The Court further found that because: the Lease does not require that the tenant give any notice to vacate at the end of the lease term; the inclusion of the 30–day notice provision in the guaranty makes sense only if the guaranty can terminate before the end of the lease, leaving the tenant, but not the guarantor, liable for post-surrender rent. Indeed, reading “surrender” in the guaranty to include acceptance would render the 30–day notice an impossibility. If, as [landlord] contends, “surrender” in the guaranty requires its acceptance, the notice requirement would require [tenant] to provide notice 30 days before [landlord] accepts the surrender, which would be both impossible and nonsensical. [Citations omitted.] Finally, the Court noted that the parties could have easily crafted a guaranty that was expressly a “good guy” guaranty without the need for the court to “resort to rules of construction regarding superfluity or canons that aid in determining the parties’ intent.” It should be noted that Justice Singas wrote a lengthy dissenting opinion in which one other justice concurred. Jonathan H. Freiberger is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes and is not intended to be and should not be taken as legal advice.

By: Jeffrey M. Haber As readers of this Blog know, we have written about many types of fraud over the years, such as affinity fraud, common law fraud, fraud in the inducement, fraudulent concealment, and securities fraud. Another type of fraud concerns fraud in the execution or fraud in the factum.[1] Three years ago, we examined Paredes v. Vorhand , a case involving this legal principle (here).[2] Since that time, we have not examined any cases involving fraud in the execution. Today, we do so. In Dodobayeva v. Rubinoff, 2025 N.Y. Slip Op. 05219 (2d Dept. Oct. 1, 2025) (here), plaintiff, claiming limited English skills, alleged she was deceived into signing a deed transferring property to her daughter-in-law. The Appellate Division, Second Department, affirmed the dismissal of her claim, ruling that she failed to exercise due diligence, as she neither read nor inquired about the documents. The Court also rejected her reliance on the two-year discovery rule for statute of limitations purposes, finding that she could have discovered the alleged fraud earlier. Fraud In the Factum: A Primer Fraud in the execution, or fraud in the factum, arises where a party did not know the nature or the contents of the document being signed, or the consequences of signing it, and was nonetheless misled into executing it.[3] “However, a party who signs a document without any valid excuse for not having read it is conclusively bound by its terms.”[4] “Moreover, a plaintiff is expected to exercise ordinary diligence and may not claim to have reasonably relied on a defendant’s representations or silence where he or she has means available to him or her of knowing, by the exercise of ordinary intelligence, the truth or the real quality of the subject of the representation.”[5] Thus, the failure to read the document before signing “prevents [the plaintiff] from establishing justifiable reliance, an essential element of fraud in the execution.”[6] In other words, absent some impairment (e.g., “the signer is illiterate, blind, or not a speaker of the language in which the document is written”),[7] a plaintiff cannot justifiably rely on another’s representation that the words used in the document means something other than what they state.[8] Importantly, the signer who claims to have some impairment must be free of negligence.[9] This means that disability by itself does not automatically excuse the signer from making a reasonable effort to learn the contents of the document being signed.[10] “The cases consistently hold that a person” with a disability or an inability to speak and/or read the English language “must make a reasonable effort to have the document read to him.”[11] The Two-Year Discovery Rule: A Primer “A cause of action based upon fraud must be commenced within six years from the time of the fraud, or within two years from the time the fraud was discovered, or with reasonable diligence could have been discovered, whichever is longer.”[12] “‘Where a plaintiff relies upon the two-year discovery exception to the six-year limitations period, the burden of establishing that the fraud could not have been discovered prior to the two-year period before the commencement of the action rests on the plaintiff who seeks the benefit of the exception.’”[13] Although, “‘[o]rdinarily, an inquiry into when a plaintiff should have discovered an alleged fraud presents a mixed question of law and fact’”[14] “summary dismissal is appropriate where it conclusively appears that the plaintiff has knowledge of facts which should have caused [him or] her to inquire and discover the alleged fraud.”[15] “Thus, although ‘mere suspicion’ will not substitute for knowledge of the fraudulent act”,[16] a plaintiff may not “shut his [or her] eyes to facts which call for investigation.”[17] Dodobayeva v. Rubinoff With the foregoing principles in mind, we examine Dodobayeva v. Rubinoff, an action, inter alia, to set aside an allegedly fraudulent conveyance of an interest in real property. Background In February 2020, plaintiff sued her daughter-in-law (“defendant”), and another defendant, inter alia, to set aside a 2013 conveyance of plaintiff’s one-half interest in certain residential real property located in Queens, New York (hereinafter, the “premises”) to defendant. Plaintiff alleged, among other things, that she was fraudulently induced into signing certain documents, including a quitclaim deed, effectuating the conveyance of the premises, in that she believed, at the time that she signed the documentation to convey the premises, that she was executing documents to enable her son, defendant’s spouse, to become an owner of the premises. Plaintiff also alleged that she discovered for the first time in January 2020 that the documents that she signed in 2013 made defendant the sole owner of the premises. Plaintiff further alleged that as a native of Uzbekistan, she possessed “limited skills in the comprehension and use of the English language” at the time of the conveyance. Plaintiff additionally alleged that she executed the documents upon her justifiable reliance on purportedly fraudulent representations made by defendant at the time of the conveyance. Defendant answered the complaint and subsequently cross-moved, inter alia, pursuant to CPLR 3211(a)(5) and (7) to dismiss the cause of action alleging fraud on the grounds that it was time-barred and that plaintiff failed to state a cause of action. Plaintiff opposed. Plaintiff submitted an affidavit in which she stated that she signed the conveyance documents without reading them and that she would not have understood the documents even if she had tried to do so due to her English language limitations. Plaintiff further stated in her affidavit that she never had any conversations with her son about the 2013 conveyance or about the documents she signed until January 2020. In an order dated September 12, 2023, the Supreme Court, among other things, granted defendant’s cross-motion. Plaintiff appealed. The Second Department affirmed. The Second Department’s Decision The Court held that “plaintiff conclusively was presumed to have agreed to the terms of the documents and, accordingly, cannot establish that she lacked knowledge from which she could have discovered the alleged fraud with reasonable diligence.”[18] The Court explained that “plaintiff admitted that she neither read nor inquired about the contents of the documents upon which she relies to establish the fraud before she signed them. Yet, she failed to proffer any valid excuse for her failure to do so.”[19] Therefore, concluded the Court, plaintiff could not demonstrate fraud in the factum.[20] The Court also held that defendant “met her prima facie burden of demonstrating that the cause of action alleging fraud accrued no later than the date of the execution of the quitclaim deed in February 2013.”[21] Therefore, said the Court, the fraud in the execution cause of action was “time-barred” as having been “asserted more than six years later” after execution of the quitclaim deed.[22] The Court also held that plaintiff failed to “establish that the fraud could not have been discovered before the two-year period prior to the commencement of [the] action.”[23] “Accordingly,” the Court held that “the Supreme Court properly granted dismissal of the cause of action alleging fraud … as time-barred.”[24] Takeaway In Dodobayeva, plaintiff claimed that she was misled into signing a quitclaim deed transferring property to her daughter-in-law, believing it was for her son’s benefit. As discussed, plaintiff claimed that, due to language barriers, she did not understand the document. However, in affirming the dismissal of plaintiff’s fraud claim, the Court found that “plaintiff admitted that she neither read nor inquired about the contents of the documents upon which she relie[d] to establish the fraud before she signed them. Yet, she failed to proffer any valid excuse for her failure to do so.”[25] In doing so, the Court emphasized the principle that individuals are presumed to understand documents they sign unless they can show a valid, non-negligent reason—such as illiteracy or language barriers—and that they made reasonable efforts to understand the document before they sign it. In Dodobayeva, the Court also addressed the statute of limitations applicable to fraud causes of action. As discussed, the Court held that plaintiff failed to meet her burden of showing that she brought her claim within two years of discovering the alleged fraud. The Court found that plaintiff did not make any inquiries about the alleged fraud for seven years. Consequently, the Court affirmed the dismissal of plaintiff’s fraud claim as time-barred and unsupported by justifiable reliance. Dodobayeva therefore reinforces the principle that litigants have a duty to inquire into the facts and circumstances of the transactions into which they enter when they possess facts showing that they may be the victims of fraud. ____________________________ Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes and is not intended to be and should not be taken as legal advice. [1] Fraud in the execution is different than fraud in the inducement. In the latter, the fraud is based on facts occurring prior or subsequent to the execution of a contract which tend to demonstrate that an agreement, valid on its face and properly executed, is to be limited or avoided. [2] Paredes v. Vorhand, 204 A.D.3d 1468 (4th Dept. 2022). [3] Fleming v. Ponziani, 24 N.Y.2d 105, 111 (1969); Gilbert v. Rothschild, 280 N.Y. 66, 71-72 (1939). [4] Cannariato v. Cannariato, 136 A.D.3d 627, 628 (2d Dept. 2016) (alteration and internal quotation marks omitted). [5] Lapin v. Verner, 238 A.D.3d 1128, 1129-1130 (2d Dept. 2025) (alterations and internal quotation marks omitted); see also Benjamin v. Yeroushalmi, 178 A.D.3d 650, 654 (2d Dept. 2019). [6] Sorenson v. Bridge Capital Corp., 52 A.D.3d 265, 266 (1st Dept. 2008), lv. dismissed, 12 N.Y.3d 748 (2009). [7] Anderson v. Dinkes & Schwitzer, P.C., 150 A.D.3d 805, 806 (2d Dept. 2017). [8] Countrywide Home Loans, Inc. v. Gibson, 157 A.D.3d 853, 856 (2d Dept. 2018); see also Ackerman v. Ackerman, 120 A.D.3d 1279, 1280 (2d Dept. 2014); Dasz, Inc. v. Meritocracy Ventures, Ltd., 108 A.D.3d 1084, 1084-1085 (4th Dept. 2013); Sorenson, 52 A.D.3d at 266. See also Pimpinello v. Swift & Co., 253 N.Y. 159, 163 (1930) (holding, “[i]f the signer [of a document] is illiterate, or blind, or ignorant of the alien language of the writing, and the contents thereof are misread or misrepresented to him by the other party, or even by a stranger, unless the signer be negligent, the writing is void”). [9] Sofio v. Hughes, 162 A.D.2d 518, 520 (2d Dept. 1990). [10] Id. [11] Id. (citing Albany Med. Center Hosp. v. Armlin, 146 A.D.2d 866, 867 (3d Dept. 1989), and Brian Wallach Agency v. Bank of N.Y., 75 A.D.2d 878, 879 (2d Dept. 1980)). [12] York v. York, 235 A.D.3d 1032, 1033 (2d Dept. 2025) (internal quotation marks omitted); see also CPLR 203(g); 213(8); Sargiss v. Magarelli, 12 N.Y.3d 527, 532 (2009). [13] York, 235 A.D.3d at 1033 (quoting Cannariato, 136 A.D.3d at 627). [14] Gormley v. Marist Bros. of the Schs., Province of the United States of Am., 236 A.D.3d 868, 870 (2d Dept. 2025) (quoting Vilsack v. Meyer, 96 A.D.3d 827, 828 (2d Dept. 2012)); see also Trepuk v. Frank, 44 N.Y.2d 723, 724-725 (1978). [15] Cannariato, 136 A.D.3d at 628 (internal quotation marks omitted). [16] Id. (quoting Erbe v. Lincoln Rochester Trust Co., 3 N.Y.2d 321, 326 (1957)). [17] Saphir Intl., SA v. UBS PaineWebber Inc., 25 A.D.3d 315, 316 (1st Dept. 2006) (quoting Schmidt v. McKay, 555 F.2d 30, 37 (2d Cir. 1977)); see also Shannon v. Gordon, 249 A.D.2d 291, 292 (2d Dept. 1988). [18] Slip Op. at *1 (citing Cannariato, 136 A.D.3d at 628). [19] Id. [20] Id. [21] Id. [22] Id. [23] Id. [24] Id. [25] Id.

By: Jeffrey M. Haber New York’s Limited Liability Company Law § 607 limits the remedies available to a creditor when the judgment debtor is an LLC member, confining recovery to the member’s economic interest and prohibiting any direct interference with LLC property. As demonstrated in Finance Holding Co., LLC v. Farzam, 2026 N.Y. Slip Op 31868(U) (Sup. Ct., N.Y. County Apr. 7, 2026), courts use the statute to protect the separation between the LLC and its members. Finance Holding involved a judgment enforcement action in which the petitioner sought to satisfy a nearly $2 million judgment against an individual LLC member by targeting his interests in two LLCs that owned residential apartment buildings. Through a series of motions, the motion court addressed the permissible scope of relief under LLC Law § 607, rejecting attempts to reach LLC assets or control their operations while permitting remedies directed solely at the debtor‑member’s economic interests. Finance Holding Co., LLC v. Farzam Finance Holding is a judgment-enforcement proceeding that arose as a consequence of petitioner obtaining a judgment against respondent for $1,903,366.57 in a related action. In that action, petitioner was seeking to enforce that judgment against respondent directly. In Finance Holding, petitioner moved to enforce its judgment against respondent’s ownership interests in two LLCs that own residential apartment buildings (“respondent LLCs”). Before the motion court were three motions. The first motion involved an order to show cause brought by petitioner seeking relief directed at respondent’s membership interests in the respondent LLCs. In response (the second motion), respondent filed a motion to dismiss the petition insofar as it sought relief against his wife. Separately, respondent’s wife filed her own motion to dismiss the petition as against her and sought attorney’s fees as a sanction under 22 NYCRR 130‑1.1 (the third motion). The motion court denied respondents’ motions. Respondent’s motion to dismiss was denied because he was not admitted to practice law in New York and, therefore, lacked the authority to appear or seek relief on behalf of another party, including his wife. As to the wife’s motion, petitioner clarified that she had been named in the proceeding solely to provide notice, based on her status as a 50 percent member of the respondent LLCs, and that no substantive relief was being sought against her personally. In light of that representation, the motion court denied the request for dismissal as academic. The motion court also denied the wife’s request for sanctions, finding that adding her to the proceeding for notice purposes did not constitute frivolous or vexatious conduct within the meaning of 22 NYCRR 130‑1.1. With those rulings, the motion court turned to petitioner’s motion on the merits. Petitioner sought a range of relief related to respondent’s interests in the respondent LLCs, including a turnover order, an order charging or garnishing his membership interests, appointment of a receiver over the LLCs, injunctive relief restraining the transfer of membership interests, a declaration establishing priority over other actual or potential creditors, and an award of attorney’s fees. The motion court granted in part and denied in part petitioner’s motion. In so ruling, the motion court determined that the majority of the relief sought by petitioner was unavailable as a matter of law. The motion court focused on the limits placed on a judgment creditor’s ability to pursue relief against assets owned by limited liability companies when the judgment is against an individual member. Respondents argued, and the motion court agreed, that because petitioner’s requested relief against the LLCs derived solely from its judgment against respondent as an LLC member, that relief was subject to Limited Liability Company Law (“LLC Law”) § 607. That statute bars a creditor of an LLC member from “obtain[ing] possession of, or otherwise exercising legal or equitable remedies with respect to, the property of the limited liability company.”[1] In practical terms, LLC Law § 607 protects an LLC’s assets and operations from being disrupted by the creditors of individual members. Applying LLC Law § 607, the motion court concluded that several categories of relief sought by petitioner were barred. Petitioner sought turnover of funds and real property held by the respondent LLCs, garnishment of proceeds from any sale of LLC assets or property, and injunctive relief preventing respondents from selling or otherwise disposing of LLC-held property. The motion court found that each of these requests would improperly allow petitioner, as a creditor of an individual member, to reach or control LLC property directly. Because the statute forecloses that result, the motion court denied the requested relief as statutorily unavailable.[2] The motion court next addressed petitioner’s request for a declaratory judgment establishing that it had priority over all other creditors of respondent in collecting proceeds necessary to satisfy the judgment. The motion court found this request procedurally and substantively deficient. The motion court noted that priority disputes among creditors are ordinarily resolved through proceedings that join adverse claimants, such as those contemplated by CPLR 5239.[3] In Finance Holding, however, petitioner had neither identified nor joined any other creditors whose rights would be affected by the requested declaration.[4] Petitioner also failed to allege that any such competing creditors even existed.[5] Without adverse parties or a concrete dispute over priority, the motion court concluded that there was no justiciable controversy for it to resolve.[6] As a result, the motion court denied that portion of petitioner’s motion.[7] The motion court thereafter addressed petitioner’s request for a turnover order and a charging order with respect to respondent’s membership interests in the LLCs. The motion court noted that under LLC Law § 607, a court has the authority to impose a charging order on respondent’s LLC membership interests.[8] Alternatively, said the motion court, a court could, but was not required to, direct turnover of respondent’s LLC membership interests to petitioner as judgment creditor.[9] “In choosing between these remedies,” the motion court took “into account that directing turnover would have the undesirable effect of making petitioner and [respondent’s wife] involuntary equal partners in the management of the buildings owned by the LLC respondents—over [the wife’s] strong objection.”[10] Additionally, explained the motion court, “petitioner [did] not explain why turnover would be more effective than a charging order for purposes of petitioner’s efforts to collect on its judgment against [respondent].”[11] Therefore, the motion court concluded “that imposing a charging order, rather than directing turnover, [was] the appropriate remedy.”[12] The motion court also denied petitioner’s request for the appointment of a receiver over respondent’s LLC membership interests and over the apartment buildings owned by the respondent LLCs, finding that petitioner failed to demonstrate the “special reason” required to justify such relief.[13] The motion court noted that petitioner did not show it had exhausted other, less intrusive means of enforcing the judgment, such as levying against real property owned by respondent personally.[14] Nor did petitioner explain how a receivership would be more effective in satisfying the judgment than a charging order directed at respondent’s membership interests.[15] The motion court also emphasized that the scope of the proposed receivership was overly broad. Rather than being limited to respondent’s interests in the respondent LLCs, petitioner sought a receiver with authority over the day‑to‑day operation, sale, and management of the apartment buildings owned by the LLCs.[16] The motion court found this particularly problematic, especially given that respondent holds only a 50 percent interest in the respondent LLCs.[17] Petitioner failed to address how appointing a receiver would affect or operate alongside the 50 percent ownership interest of respondent’s wife.[18] In light of these deficiencies, the motion court denied that request. Finally, the motion court rejected petitioner’s request for broad injunctive relief because a judgment creditor may not restrict an LLC’s control over its own assets and petitioner provided no basis for relief against respondent’s non‑debtor wife.[19] However, the motion court granted injunctive relief against respondent, enjoining him and his agents from transferring or disposing of his LLC membership interests and from dissipating any income, distributions, or proceeds payable to him from the LLCs.[20] Takeaway Focusing on LLC Law § 607, Finance Holding underscores the limits New York law places on judgment enforcement when the judgment debtor is an LLC member rather than the LLC itself. The central takeaway of the holding is that Section 607 operates as a statutory shield for LLC property, preventing a member’s creditors from reaching, controlling, or interfering with the assets owned by the LLC. The decision also illustrates that a creditor’s remedies are confined to the debtor‑member’s interest in the LLC. Section 607 bars turnover orders, garnishment, receiverships, and injunctions that would effectively give the creditor control over LLC property or management. As shown in Finance Holding, courts reject attempts to bypass this rule, especially where the requested relief would disrupt the LLC’s affairs or prejudice other members who are not judgment debtors. A related takeaway from the Finance Holding decision is the preference, under Section 607, for charging orders as an enforcement mechanism. A charging order allows a creditor to place a lien on distributions payable to the debtor‑member without altering ownership, governance, or control of the LLC. Finance Holding emphasizes that courts are reluctant to order turnover of membership interests or appoint receivers, where doing so would force non‑consensual business relationships, interfere with management, or go beyond the debtor’s economic rights, especially when the debtor owns less than 100% of the LLC. Overall, the key lesson of Finance Holding is that when a judgment debtor is an LLC member, Section 607 limits enforcement to the judgment debtor’s economic interests only. Courts will enforce those limits rigorously, protecting LLC assets and non‑debtor members from collateral damage while still allowing creditors a defined path to judgment recovery. __________________________________ Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes only and is not intended to be, and should not be, taken as legal advice. Unless otherwise stated, Freiberger Haber LLP’s articles are based on recently decided published opinions or litigation releases and not on matters handled by the firm. ___________________________________ [1] Slip Op. at *3, quoting LLC Law § 607(b). [2] Id. [3] Id. [4] Id. [5] Id. [6] Id., citing Premier Restorations of N.Y. Corp. v. New York State Dept. of Motor Vehs., 127 A.D.3d 1049, 1049 (2d Dept. 2015) (describing requirements for availability of declaratory-judgment claim). [7] Id. Also, the motion court denied petitioner’s request for an award of attorney’s fees. The motion court explained that attorney’s fees are not recoverable in a turnover proceeding brought under CPLR 5225(b), which was one of the statutory bases relied upon by petitioner. Id., citing Bienstock v. Greycroft Partners, L.P., 128 A.D.3d 459, 459 (1st Dept. 2015). Although petitioner sought additional forms of relief under other statutes, it did not identify any statutory provision authorizing the recovery of attorney’s fees in connection with those remedies. The motion court further emphasized that, absent a contractual or statutory basis, it did not possess inherent authority to award attorney’s fees simply because a party prevailed or incurred expenses. On that basis, petitioner’s application for attorney’s fees was denied in its entirety. [8] A charging order under LLC Law § 607 is a court-ordered lien placed on a debtor-member’s interest in an LLC, requiring the company to pay any distributions – profits or income – directly to the creditor instead of the member until the judgment is satisfied. It is a remedy for creditors to satisfy personal debts from a member’s LLC interest. [9] Slip Op. at *3, citing 79 Madison LLC v. Ebrahimzadeh, 203 A.D.3d 589, 589 (1st Dept. 2022); Sirotkin v. Jordan, LLC, 141 A.D.3d 670, 672 (2d Dept. 2016). [10] Id., citing TBC Funding LLC v. Kenwood Commons, LLC, 2026 N.Y. Slip Op. 26027, at *4 (Sup. Ct., Albany County 2026) (discussing the choice between a turnover order and a charging order). [11] Id. at *4. [12] Id. [13] Id., citing Itria Ventures LLC v. Beaver Street Pizza LLC, 194 A.D.3d 447, 447 (1st Dept. 2021) (internal quotation marks omitted). [14] Id. [15] Id. [16] Id., Hotez 71 Mezz Lender LLC v. Falor, 14 N.Y.3d 303, 418 (2010) (noting that a factor pointing toward granting the plaintiff’s request for the appointment of a receiver is that “plaintiff seeks receivership over defendants’ ownership/ membership interests, not the day-to-day operation of a foreign corporation”). [17] Id. [18] Id. [19] Id. [20] Id.

By: Jeffrey M. Haber Affinity fraud is a form of financial fraud that relies on social connections and trust. It most often occurs within identifiable groups, such as religious congregations, cultural or ethnic communities, professional networks, or social organizations, where members share common values, experiences, or identities. Rather than approaching targets as strangers, those promoting the scheme position themselves as insiders, using familiarity and perceived credibility to create comfort and reduce skepticism. In many cases, affinity fraud begins with what appears to be a legitimate opportunity. The investment or business venture is typically described as low‑risk and reliable, sometimes with returns that appear to be guaranteed. Details may be presented in broad or technical terms that discourage deeper questioning, and potential participants are often reassured that others within the community have already taken part. Because the offer is communicated through trusted channels, such as friends, colleagues, or respected community figures, individuals may rely more on personal trust than independent verification. As participation grows, the scheme often spreads through informal referrals rather than public advertising. Some affinity frauds are later revealed to be Ponzi or pyramid schemes, where returns paid to earlier participants are funded by money from newer ones rather than genuine profits. These structures can persist for extended periods, particularly when community members are reluctant to question or report someone they know personally. In some cases, individuals who promote the opportunity are unaware that they are participating in a fraudulent scheme themselves. The effects of affinity fraud extend beyond financial loss. Because the deception operates within trusted social networks, its discovery can strain relationships and create lasting tension within a community. Individuals may feel embarrassed, conflicted, or hesitant to speak openly about their experience. This dynamic can delay detection and complicate efforts to address the situation once concerns arise. Securities and Exchange Commission v. Robert L. Murray, Jr. On May 4, 2026, the United States District Court for the Northern District of Illinois entered a final judgment as to Robert L. Murray, Jr., a former U.S. Navy chief petty officer, in connection with the SEC’s enforcement action against Murray for allegedly engaging in a fraudulent investment scheme that used Facebook to target U.S. Navy active duty service members, veterans, and reservists.[1] According to the SEC’s complaint, defendant, a retired U.S. Navy Chief, operated an unregistered investment fund and investment advisory business through an entity known as Deep Dive Strategies, LLC (“DDS” or the “Fund”), and raised investor capital through material misrepresentations and omissions. According to the SEC, from approximately September 2020 through January 2022, defendant solicited investments in DDS from individuals throughout the United States, many of whom were active‑duty servicemembers, veterans, or otherwise affiliated with the U.S. Navy. The SEC alleged that defendant used his military background and social media presence within Navy‑affiliated investing communities to establish credibility and attract investors. In total, defendant allegedly raised approximately $354,800 from about 44 investors located in at least 14 states, including investors serving overseas. DDS was organized as a limited liability company in Ohio in September 2020. Defendant was the Fund’s sole managing member, controlled its bank and brokerage accounts, and made all investment decisions. Investors purchased membership interests in the Fund at $5,000 per unit. The SEC said that defendant provided some investors with an operating agreement and disclosure statement, which represented that DDS would pool investor funds and trade in publicly traded securities for the benefit of its members. The offering materials further disclosed that defendant would receive a two percent annual administrative fee and a twenty percent share of trading profits, but would not earn profits in years when the Fund incurred losses. The SEC alleged that both written and oral representations to investors stated that their funds would be used exclusively for securities trading and payment of disclosed Fund expenses. Investors were allegedly told that at the end of the 2021 calendar year, after a one‑year investment period, they could request redemption of their investment, net of profits or losses, and that redemption requests would be honored within fifteen days. According to the SEC, investors exercised no control over investment decisions, which were made solely by defendant, and defendant acted as an investment adviser to the Fund. The SEC alleged that defendant’s representations concerning the use of investor funds were false and misleading. While some Fund assets were initially used to trade securities, defendant allegedly began misappropriating investor funds almost immediately after receiving them. The SEC claimed that defendant transferred substantial amounts of Fund money to his personal bank accounts, withdrew large sums in cash, and used investor funds to pay personal expenses unrelated to Fund operations. The SEC further alleged that defendant’s securities trading activity on behalf of DDS was brief and unsuccessful. According to the complaint, DDS suffered substantial trading losses in January 2021, including losses associated with highly speculative options trading. By late January 2021, nearly all trading capital had been lost, said the SEC. Defendant allegedly made no further trades after January 23, 2021, and withdrew the remaining balance from the Fund’s brokerage account in early February 2021. Despite the cessation of trading activities, the SEC alleged that defendant continued to solicit and accept investor funds through February 2021. These additional funds were not deposited into the brokerage account or used for securities trading but instead were allegedly misappropriated. In total, the SEC claimed that defendant misappropriated approximately $148,000 of investor funds, representing nearly 42 percent of the capital raised, after accounting for permitted administrative fees. The SEC also alleged that defendant failed to provide investors with meaningful accounting information and gradually reduced communication with them beginning in March 2021. When some investors sought redemptions in accordance with the offering materials, defendant allegedly failed to return any funds. Although defendant reportedly told investors in August 2021 that he intended to wind down the Fund and return remaining assets, no such distributions were made. The SEC alleged that defendant never filed a registration statement with respect to the offer and sale of securities in DDS and did not qualify for an exemption from registration. The SEC further alleged that defendant used interstate commerce and the mails to conduct the offering through social media platforms, electronic communications, and bank transfers. Based on the foregoing allegations, the SEC asserted claims for violations of the antifraud provisions of the Securities Act of 1933 (“Securities Act”) and the Securities Exchange Act of 1934 (“Exchange Act”), including Section 10(b) and Rule 10b‑5, as well as violations of Sections 17(a)(1), (2), and (3) of the Securities Act. The SEC also alleged violations of the registration provisions of Sections 5(a) and 5(c) of the Securities Act. In addition, the SEC asserted claims under Sections 206(1), 206(2), and 206(4) of the Investment Advisers Act of 1940 (“Investment Advisors Act”), alleging that defendant engaged in fraudulent and deceptive conduct while acting as an investment adviser to a pooled investment vehicle. The final judgment permanently enjoins defendant from violating Sections 5(a), 5(c), and 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, and Sections 206(1), 206(2), and 206(4) of the Investment Advisers Act, and orders him to pay disgorgement in the amount of $112,271.71, which is to be deemed satisfied by the order of restitution entered against him in United States v. Murray, No. 22-cr-643 (N.D. Ill.), a parallel criminal matter. Takeaway The SEC’s enforcement action demonstrates how investment fraud can operate within trusted communities. The case shows that affinity fraud is defined not by the investment product, but by how shared identity and trust are used to attract and retain investors. Defendant, a retired U.S. Navy Chief, marketed an unregistered investment fund primarily to Navy servicemembers, veterans, and reservists through military‑focused social media groups. By emphasizing his military background and insider status, he leveraged the trust associated with shared service and rank. That reliance on military identity as a credibility tool is a central characteristic of affinity fraud. The investment was presented as legitimate and structured, complete with offering documents, stated fees, and redemption rights. Investors were told their money would be pooled and used solely for securities trading. In reality, trading activity was brief, highly speculative, and unsuccessful, and a substantial portion of investor funds was diverted to personal use. Promised transparency and redemptions never materialized, and communication with investors diminished as losses mounted. The enforcement action and judgment highlights how affinity fraud often overlaps with traditional securities violations. The conduct alleged included unregistered securities offerings, adviser fraud, material misrepresentations, and misappropriation of funds. Affinity fraud did not replace these violations; it amplified their impact by increasing investor reliance on trust rather than verification. The judgment, which imposed permanent injunctions and disgorgement, reinforces several lessons: shared background is not a substitute for due diligence; centralized control without oversight increases risk; lack of transparency and missed redemptions are serious red flags; and registration status matters. __________________________________ Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes only and is not intended to be, and should not be, taken as legal advice. Unless otherwise stated, Freiberger Haber LLP’s articles are based on recently decided published opinions or litigation releases and not on matters handled by the firm. ___________________________________ [1] The SEC’s litigation release announcing the entry of judgment was disseminated on May 5, 2026.

By Jonathan H. Freiberger Mechanics’ liens are powerful tools available to, inter alia, contractors, laborers and materialmen when they are not paid for their work in improving real property. As the Court of Appeals noted long ago: The object and purpose of the mechanics' lien law was to protect a person who, with the consent of the owner of real property, enhanced its value by furnishing materials or performing labor in its improvement, by giving him an interest therein to the extent of the value of such material or labor. The filing of the notice of lien is the statutory method prescribed by which the party entitled thereto perfects his inchoate right to that interest. John P. Kane Co. v. Kinney, 174 N.Y. 69, 73 (1903). Section 3 of the Lien Law provides that a “contractor, subcontractor, laborer, materialman … who performs labor or furnishes materials for the improvement of real property with the consent or at the request of the owner thereof …, shall have a lien for the principal and interest, of the value, or the agreed price, of such labor ... due or payable for the benefit of any laborer, or materials upon the real property improved or to be improved and upon such improvement, from the time of filing a notice of such lien as prescribed in this chapter….” Lien Law § 3 “should be liberally construed to secure the purposes for which it was intended, namely the protection of that class of people who perform services or supply the material for the improvement of realty….” Claudio Perfetto, Inc. v. Waste Management of New York, 274 A.D.2d 389, 390 (2d Dept. 2000) (citations omitted). Once filed, a mechanics’ lien is valid for one year “unless within that time an action is commenced to foreclose the lien, and a notice of the pendency of such action … is filed with the county clerk of the county in which the notice of lien is filed” or unless an extension is filed by the lienor. Lien Law § 17 (emphasis added); see also Thomas Bros. Pile Corp. v. Rosenblum, 134 A.D.3d 1020, 1021 (2d Dept. 2015). A lienor only gets one extension by filing. If an action to foreclose the lien is not commenced within the extension period, the lien can only be extended by an order of the court. Aztec Window & Door Mfg., Inc. v. 71 Village Road, LLC, 60 A.D.3d 795, 796 (2d Dept. 2009). Absent an extension, “the lien automatically expires by operation of law, becoming a nullity and requiring its discharge.” Id. (citation omitted). A mechanics’ lien is an encumbrance on real property. Edward Joy Co., Inc. v. McGuire & Bennett, Inc., 199 A.D.2d 1015 (4th Dept. 1993). Thus, the placing of a mechanics’ lien on real property can adversely impact the owner’s rights. For example, the filing of a mechanic s’ lien could be an event of default under a mortgage loan. Similarly, the existence of a mechanic s’ lien could negatively impact the ability of an owner to mortgage or sell the liened property. Thus, the ability to discharge a lien is critical to an owner. Section 19 of the Lien Law offers several ways to discharge a lien.[1] Thus, a lien will be discharged: when the lienor files a satisfaction or release of the lien (Lien Law § 19(1)); if the lienor fails to commence an action to foreclose the lien or extend the lien within a year of filing (Lien Law § 19(2)); by court order vacating the lien for failure to prosecute the lien (Lien Law § 19(3)); by filing with the county clerk a copy of a transcript of a judgment “showing a final determination of the action in favor of the owner of the property against which the lien was claimed (Lien Law § 19(5)); by obtaining a court order summarily discharging the lien because, inter alia, the “character of the labor or materials furnished and for which the lien is claimed” do not support a lien or the lienor failed to comply with section 9[2] of the Lien Law (Lien Law § 19(6)); or, as is relevant to today’s article, by the posting of a bond discharging the lien(Lien Law § 19(4)). Section 19(4) of the lien law provides that “[e]ither before or after the beginning of an action by the owner or contractor executing a bond or undertaking in an amount equal to one hundred ten percent of such lien conditioned for the payment of any judgment which may be rendered against the property for the enforcement of the lien….” The lien attaches to the posted bond in place and instead of the real property. The lienor remains protected and the owner is not constrained by the encumbrance of the lien. Against this backdrop, we discuss Hewitt Builder and Renovations, Inc. v. Farmingville Assoc. Phase 1, LLC, a case decided by the Appellate Division, Second Department, on May 6, 2026.[3] The defendant property owner in Hewitt (“Owner”) entered into a construction contract with the defendant general contractor (the “GC”). The plaintiff subcontractor (the “Sub”) entered into a subcontract with the GC. The Sub alleged that it completed its work under the subcontract but only received partial payment for its work. As a result, on November 29, 2021, the Sub filed a mechanics’ lien against the property. Four months later, in March of 2022, the Sub commenced an action to foreclose its lien, but failed to file a notice of pendency. On December 21, 2022, over a year after the commencement of the action, the Owner obtained a surety bond discharging the lien. The Sub appeals from the motion court’s grant of the defendants’ motion to dismiss the complaint because the lien subject to the foreclosure action lapsed. The Second Department affirmed and stated: Pursuant to Lien Law § 17, a mechanic's lien expires one year after filing unless an extension is filed with the County Clerk or an action is commenced to foreclose the lien and a notice of pendency is filed within that time period. Here, since it is undisputed that the plaintiff failed to file a notice of pendency or move to extend the time to do so within one year after the mechanic's lien was filed, and no extensions of the mechanic's lien were obtained from the court, the mechanic's lien automatically expired by operation of law one year after it was filed. Contrary to the plaintiff's contention, the bond obtained by the defendants did not permit the plaintiff to continue the foreclosure action against the bond rather than the property as the bond was obtained after the lien had automatically expired by operation of law. (Citations and internal quotation marks omitted.) Jonathan H. Freiberger is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes and is not intended to be and should not be taken as legal advice. [1] Section 20 of the Lien Law permits the discharge of a mechanics’ lien by depositing with the “county clerk, in whose office the notice of lien is filed, a sum of money equal to the amount claimed in such notice, with interest to the time of such deposit.” [2] Section 9 of the Lien law sets forth the required contents of a mechanics’ lien. [3] Some of the facts recited herein were obtained from the motion court filings available on the court’s NYSCEF system.

By: Jeffrey M. Haber Under New York’s Limited Liability Company Law (“LLCL”) § 702, a court “may decree dissolution of a limited liability company whenever it is not reasonably practicable to carry on the business in conformity with the articles of organization or operating agreement.” The claim must be brought “[o]n application by or for a member” of the company.[1] In Matter of Bodenchak v. 5178 Holdings LLC, 2025 N.Y. Slip Op. 05875 (1st Dept. Oct. 23, 2025) (here), the Appellate Division, First Department, examined the “by or for” language of LLCL § 702 in affirming the grant of a motion to substitute the estate of a deceased member for the decedent in the proceeding.[2] Bodenchak was brought as a special proceeding in which the original petitioner, Frank Bodenchak (“Frank”), a minority investor in 5178 Holdings LLC (“5178”), sought both direct monetary damages and the judicial dissolution of 5178, a New York Limited Liability Company (“LLC”), pursuant to LLCL § 702. Frank died shortly after commencing suit. His widow, Dawn Bodenchak (“Dawn”), was appointed executor of his estate and moved to substitute as petitioner. Respondents opposed the motion, contending the estate could not maintain the dissolution portion of the proceeding under LLCL § 702. The motion court granted the motion. Respondents appealed. The First Department “unanimously affirmed”. The issue on appeal concerned the request for judicial dissolution of 5178. As to the monetary damages claims, there was no dispute. Under Section 11-3.2(b) of New York’s Estates, Powers & Trusts Law, the personal representative of a decedent’s estate may bring or continue an action “[f]or any injury,” and “[n]o cause of action for injury to person or property is lost because of the death of the person in whose favor the cause of action existed.”[3] Thus, causes of action seeking monetary damages survive a decedent’s death, and the proper party to maintain an action to recover monetary damages is the decedent’s representative. In Bodenchak, the proper party to pursue Frank’s monetary damages claims was Dawn. In addressing the request for dissolution of 5178, the Court looked to the LLCL. Under LLCL § 702, a dissolution action may be brought “[o]n application by or for a member.” The Court held that Dawn satisfied Section 702, stating “Petitioner’s application was made for decedent, a member of respondent 5178 Holdings, as executor of his estate.” Therefore, said the Court, defendants’ attempt to limit the scope of Section 702 to only members was “unavailing”.[4] Under LLCL § 608, the estate of a deceased member “may exercise all of the member’s rights for the purpose of settling his or her estate or administering his or her property,”[5] regardless of whether the estate assumes “member” status.[6] Appellate and trial court cases interpreting LLCL § 608 have consistently made it clear that the statute means what it says.[7] In Bodenchak, the Court held that “Decedent’s right to pursue dissolution passed to his estate upon his death.”[8] This was especially so, since “the dissolution proceeding [was] necessary to settle [Frank’s] estate and distribute the proceeds from the sale of the apartment owned by 5178 Holdings.”[9] Thus, contrary to the respondents’ contention, which the Court held was “also unavailing”, petitioner, as executor of Frank’s estate, had the authority to exercise Frank’s rights in the LLC for the purpose of settling the estate.[10] Takeaway In Bodenchak, the First Department reaffirmed an important point under the LLCL: the right to seek judicial dissolution of an LLC does not vanish upon a member’s death, when the dissolution proceeding is necessary to settle the deceased member’s estate. LLCL § 702 allows dissolution “on application by or for a member,” which the Court made clear includes actions brought by the estate of a deceased member. The Court relied on LLCL § 608, which grants an estate the ability to exercise all of a deceased member’s rights for purposes of settling the estate, even if the estate (or its representative) does not become a member of the LLC. Thus, under LLCL § 608, Frank’s right to seek dissolution passed to his estate upon his death, particularly because the dissolution proceeding was necessary to settle the estate and distribute assets. In short, the Bodenchak confirms that: (a) monetary damage claims survive a member’s death and can be pursued by the estate’s representative; (b) the estate of a deceased LLC member may seek judicial dissolution under LLCL § 702, when dissolution is necessary to settle the deceased member’s estate; and (c) LLCL § 608 empowers estates to exercise a deceased member’s rights for estate administration, regardless of membership status. ______________________________ Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes and is not intended to be and should not be taken as legal advice. [1] LLCL § 702. [2] In prior articles, we examined substitution upon the death of a named party. See Death and Litigation, CPLR 1015(a) and the Death of a Party, and Death of a Litigant. We have also examined judicial dissolution of an LLC under LLCL § 702. See LLC Breakups And Judicial Dissolution: The Hurdles Are High, Issues Of Fact Preclude Dismissal Of Claim For Judicial Dissolution Of LLC, Breaking Up Is Hard To Do: Court Denies Motion To Dismiss Action For Dissolution of an LLC, Court Finds that Allegedly Ousted Member of LLC Has Standing to Seek Dissolution, and Court Reinforces the Fact that Judicial Dissolution of an LLC is Not Easy. This Blog has not, however, addressed the issue in Matter of Bodenchak v. 5178 Holdings LLC. [3] Under New York law, “individual beneficiaries . . . ha[ve] no independent right to maintain an independent cause of action for the recovery of estate property, as such a right belong[s] to the personal representative of the decedent’s estate.” See Stallsworth v. Stallsworth, 138 A.D.3d 1102, 1103 (2d Dept. 2016) (citations omitted). [4] Slip Op. at *1. [5] LLCL § 608. [6] Under New York law, the death of a member of a limited liability company does not trigger dissolution of that limited liability company. See LLCL § 701(b). [7] Crabapple Corp. v. Elberg, 53 A.D.3d 434 (1st Dept. 2017); In Matter of Andris v. 1387 Forest Realty, LLC, 213 A.D.3d 923 (2d Dept 2023); see also Pachter v. Winiarski, 2021 WL 1794565 (Sup. Ct., Kings County May 5, 2021); Estate of Judith Lindenberg v. Winiarsky; 2021 WL 1794560 (Sup. Ct., Kings County May 5, 2021). [8] Slip Op. at *1 (citing Crabapple, 53 A.D.3d at 435). [9] Id. (citing Matter of Andris, 213 A.D.3d at 924). [10] Id.

By: Jeffrey M. Haber In New York, when interpreting a contract, the words of the writing must be accorded their fair and reasonable meaning, aiming for a practical interpretation that realizes the reasonable expectations of the parties.[1] The court is required to enforce a written agreement according to the plain meaning of its terms when it is complete, clear, and unambiguous on its face.[2] Although the parties may offer conflicting interpretations of their contract, that does not mean that the contract is ambiguous.[3] In that circumstance, and in general, the court is to apply the meaning intended by the parties, as derived from the language of the contract in question.[4] Thus, “where the intention of the parties may be gathered from the four corners of the instrument, interpretation of the contract is a question of law [i.e., it can be determined by the court] and no trial is necessary to determine the legal effect of the contract.”[5] In Harris v. Dream Volunteers, 2025 N.Y. Slip Op. 33963(U) (Sup. Ct., N.Y. County Oct. 14, 2025), the motion court granted defendant’s motion to dismiss plaintiff’s breach of contract claims on the grounds that the plain meaning of the contract at issue utterly refuted plaintiff’s allegations. Plaintiff commenced the action alleging breach of contract based on two theories: (1) breach of an original agreement dated April 10, 2023, asserting that plaintiff was prematurely terminated in violation of that agreement because the termination took place prior to a deadline to complete certain tasks; and (2) breach of a subsequent implied-in-fact contract, allegedly formed on December 21, 2023, which established a new deadline of October 31, 2024, for completing certain tasks. The original agreement designated plaintiff as an independent contractor providing sales and marketing strategy services to defendant. The agreement specified that “the only consideration due [plaintiff] regarding the subject matter of [the] Agreement” was payment of compensation in the amount of $6,667 per month. Section 8 of the agreement, titled “Termination,” granted defendant the right to “terminate [the] Agreement at any time, with or without cause, upon thirty (30) days’ notice except within the first ninety (90) days of [the] Agreement.” Defendant terminated the agreement on January 17, 2024, effective February 16, 2024. The termination, therefore, occurred well after the initial ninety (90) day period, making defendant’s 30-day notice within the period set forth in Section 8 of the agreement. Based upon the foregoing facts, the motion court found plaintiff’s claims to be “fatally undermined by the clear and unambiguous language contained in the agreement.”[6] Plaintiff’s claim for breach of the original agreement rested on the premise that because the agreement outlined key objectives or tasks with deadlines (e.g., June 30, 2024), defendant was obligated to keep the agreement in effect until those deadlines passed.[7] Pointing to Section 1 and Exhibit A of the agreement, the motion court noted that those sections primarily described plaintiff’s obligations under the agreement, which required her to undertake and complete services on the specified schedule. However, that section, said the motion court, “limit[ed] the defendant’s obligation by explicitly stating that the only consideration due from [defendant] was the monthly payment of $6,667.”[8] Further, explained the motion court, “Section 8 of the Agreement clearly and expressly grant[ed] the defendant the unconditional right to terminate the agreement ‘at any time, with or without cause, upon thirty (30) days’ notice except within the first ninety (90) days.’”[9] “This language,” explained the motion court, “directly contravene[d] the plaintiff’s interpretation of the agreement that setting deadlines for an independent contractor to complete certain tasks somehow create[d] an implied right that the contractor remain[ ] engaged through those dates.”[10] “Given that the contract provide[d] for termination at will after the initial 90-day period,” concluded the motion court, “irrespective of any task or objective deadlines, the claim that the plaintiff’s termination prior to June 30, 2024 was impermissible [was] utterly refuted by the plain and unambiguous language of the agreement.”[11] Finally, the motion court held that “plaintiff’s claim that the deadline to complete the tasks was extended to October 31, 2024 [was] … unavailing.”[12] First, the motion court found that “even if it could be established that the deadline was extended, the plaintiff still could have been terminated at will for the reasons stated” in the decision.[13] Second, explained the motion court, “any claim that the deadline was extended by either an oral or implied-in-fact agreement [was] foreclosed by the clear language of the agreement.”[14] The motion court noted that the amendment clause and integration clause of the agreement foreclosed any argument that an implied-in-fact contract existed: Section 13 of the agreement explicitly states that “[n]o changes or modifications or waivers to this Agreement will be effective unless in writing and signed by both parties.” The agreement also contains an integration clause, which dictates that the Agreement “constitutes the complete and exclusive agreement between the parties concerning its subject matter and supersedes all prior or contemporaneous agreements or understandings, written or oral, concerning the subject matter described herein.” Because the alleged new implied-in-fact contract derived from oral discussions and email communications concerning the existing subject matter (Consultant’s key objectives/deadlines), it violate[d] the plain language of Section 13.[15] Accordingly, the motion court granted defendant’s motion and dismissed the complaint in its entirety. Takeaway Harris underscores the fundamental principle of contract interpretation – i.e., contracts are to be construed pursuant to the parties’ intention.[16] As the Court of Appeals explained a little over three decades ago, “[t]he best evidence of what the parties … intend is what they say in their writing.”[17] When the parties’ writing is clear and unambiguous on its face – that is, the terms are reasonably susceptible to only one meaning – it should be enforced according to the plain meaning of those words. _____________________________ Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes and is not intended to be and should not be taken as legal advice. [1] Dreisinger v. Teglasi, 130 A.D.3d 524, 527 (1st Dept. 2015). [2] Greenfield v. Philles Records, 98 N.Y.2d 562, 569 (2002). [3] Bethlehem Steel Co. v. Turner Constr. Co., 2 N.Y.2d 456, 460 (1957). [4] Duane Reade, Inc. v. Cardtronics, LP, 54 A.D.3d 137, 140 (1st Dept. 2008). [5] Bethlehem Steel, 2 N.Y.2d at 460. [6] Slip Op. at *2. [7] Id. [8] Id. [9] Id. [10] Id. [11] Id. [12] Id. [13] Id. [14] Id. [15] Id. at 2-3. [16] This Blog has written about the issues in this case – namely, words have meaning – on numerous occasions. Some of the articles that we have written include: Contract Interpretation: Words Have Meaning; The New York Court of Appeals Reminds Litigants That Words in Contracts Have Meaning; Words Have Meaning; A Contract That Means What It Says; Contracts That Say What They Mean, Mean What They Say Redux; and Contracts that Say What They Mean, Mean What They Say. [17] Slamow v. Del Col, 79 N.Y.2d 1016, 1018 (1992).

By: Jeffrey M. Haber In 2019, New York enacted the Uniform Voidable Transactions Act, which repealed and replaced certain provisions of the Debtor and Creditor Law (“DCL”) relating to fraudulent conveyances,[1] which became effective April 4, 2020.[2]Transfers made after April 4, 2020 are governed by the current version of the DCL.[3] The DCL, as amended, permits creditors to void actual and constructive fraudulent transfers.[4] A creditor may void a debtor’s constructive fraudulent transfers in three situations: first, if the transfers were made without receiving reasonably equivalent value and while the debtor either (i) was engaged in a transaction for which the debtor’s remaining assets were unreasonably small in relation to the transaction or (ii) intended to incur debts beyond its ability to pay;[5] second, if they were made without receiving reasonably equivalent value, and the debtor was insolvent at the time or became so as a result of the transfer,[6] or third, if they were made to an “insider” for an antecedent debt while the debtor was, and the insider had reason to believe the debtor was, insolvent.[7] If the debtor is a corporation, “insider” for purposes of section 274(b) includes: “a person in control of the debtor,” “a relative of a … person in control of the debtor,” and “an affiliate, or an insider of an affiliate as if the affiliate were the debtor.”[8] Voidability of constructive fraudulent transactions “is unrelated to the proof of the debtor’s intent, but turns on objective facts concerning the debtor’s distressed financial condition and the inadequate consideration received.”[9] Constructive fraudulent transfer claims are not subject to heightened pleading rules.[10] A creditor may also void a debtor’s actual fraudulent transfers. DCL § 273(a), as amended, provides, in part, that a transfer made by a debtor is “voidable as to a creditor, whether the creditor’s claim arose before or after the transfer was made … if the debtor made the transfer … (1) with actual intent to hinder, delay or defraud any creditor of the debtor; or (2) without receiving a reasonably equivalent value in exchange for the transfer … and the debtor … (i) was engaged or was about to engage in a business or a transaction for which the remaining assets of the debtor were unreasonably small in relation to the business or transaction; or (ii) intended to incur, or believed or reasonably should have believed that the debtor would incur, debts beyond the debtor's ability to pay as they became due.” In determining actual intent under DCL § 273(a)(1), courts may consider the common law “badges of fraud,” which have been codified to include, among other factors, whether “(1) the transfer or obligation was to an insider; (2) the debtor retained possession or control of the property transferred after the transfer; (3) the transfer or obligation was disclosed or concealed; (4) before the transfer was made or obligation was incurred, the debtor had been sued or threatened with suit; (5) the transfer was of substantially all the debtor's assets; (6) the debtor absconded; (7) the debtor removed or concealed assets; (8) the value of the consideration received by the debtor was reasonably equivalent to the value of the asset transferred or the amount of the obligation incurred; (9) the debtor was insolvent or became insolvent shortly after the transfer was made or the obligation was incurred; (10) the transfer occurred shortly before or shortly after a substantial debt was incurred; and (11) the debtor transferred the essential assets of the business to a lienor that transferred the assets to an insider of the debtor.”[11] Although causes of action under Section 273 of the former DCL were not required to be pleaded with heightened particularity pursuant to CPLR 3016(b),[12] such particularity was required for “actual intent” causes of action arising out of Section 276 of the former DCL.[13] Since the “actual intent” provision of the former DCL was incorporated into the amended DCL (i.e., section 273 (a)(1)), causes of action arising under this subdivision must satisfy the heightened pleading requirements.[14] Thus, allegations of the transfer and badges of fraud made “upon information and belief” are generally insufficient to plead the claim with the requisite particularly of CPLR 3016(b).[15] However, where material facts are within the exclusive knowledge of the party charged with such fraud, the specificity requirement is not to be so strictly interpreted “to dismiss a case at an early stage where any pleading deficiency might be cured later in the proceedings.”[16] Therefore, a pleading based “upon information and belief” can satisfy the CPLR 3016(b) heightened pleading requirement when it is accompanied by a statement of facts “sufficient to permit a reasonable inference of the alleged conduct.”[17] In Neptune Issue Inc. Profit Sharing Plan v. Eliopoulos, 2025 N.Y. Slip Op. 06001 (3d Dept. Oct. 30, 2025 (here), the Appellate Division, Third Department, addressed the foregoing principles. In April 2016, plaintiff commenced an action against defendant Mary Ellen Eliopoulos (“Eliopoulos”) and defendant Estates of Glenburnie LLC (“Glenburnie LLC”), a domestic limited liability company owned by Eliopoulos, seeking to foreclose on a note and mortgage secured by real property located in Essex County, New York. Plaintiff commenced a second mortgage foreclosure action against Eliopoulos and Glenburnie LLC in May 2016, this time relating to real property located in Washington County, New York. While these actions were pending, Eliopoulos and Glenburnie LLC obtained two mortgages with nonparty Mako International, LLC (“Mako”), encumbering several parcels of real property located in the Town of Putnam, Washington County (“Putnam parcels”). In late 2018, plaintiff obtained judgments of foreclosure and sale in both actions and, following the referee sales, moved in each action for a deficiency judgment against Eliopoulos. In February 2019, Eliopoulos and Glenburnie LLC further encumbered the Putnam parcels with a third mortgage from Mako. Before either deficiency judgment could be rendered in plaintiff’s favor, in June 2020, Eliopoulos and Glenburnie LLC conveyed their interests in the Putnam parcels and two parcels commonly known as Lake George Way (collectively, the “subject properties”) to defendant Glenburnie Estates LLC (“GEL”) for $529,000. Eliopoulos’ son is the sole member of GEL. Plaintiff then commenced the action against Eliopoulos, Glenburnie LLC and GEL (collectively, “defendants”) seeking to set aside the conveyance of the subject properties to GEL as a voidable transaction pursuant to DCL §§ 273, 274, and 275. GEL moved, pre-answer, to dismiss the complaint for failure to state a cause of action and based on the documentary evidence. GEL contended that the allegations against defendants based “upon information and belief” were insufficient to state a cause of action with the particularity required under the DCL. GEL further contended that a subsequent proposed sale of the subject properties demonstrated that Eliopoulos and Glenburnie LLC received reasonably equivalent value from GEL in exchange for the transfer. Plaintiff opposed the motion. The motion court entered an order without any written or oral findings, denying the motion to dismiss. GEL appealed. The Court held that the complaint alleged sufficient facts to state causes of action alleging violations of DCL § 273(a)(1) and (a)(2).[18] “Although several key allegations in both causes of action were based ‘upon information and belief,’” noted the Court, it was “satisfied that the accompanying factual statements [were] sufficient to place defendants on notice of the allegations asserted against them.”[19] “Specifically,” said the Court, “each cause of action alleged that Eliopoulos and Glenburnie LLC conveyed the subject properties to her son’s entity, GEL, an insider, at a time when defendants knew they were likely to incur additional debts as a result of plaintiff’s pending actions seeking a deficiency judgment against Eliopoulos.”[20] “These factual statements,” concluded the Court, were “supported by the record, including that defendants [did] not dispute the son’s status as an insider.”[21] The Court also held that these statements satisfied “multiple factors considered to be badges of fraud,” and, therefore, were “sufficiently pleaded.”[22] The Court noted that “[a]lthough … plaintiff’s allegations relating to Eliopoulos and Glenburnie LLC’s ability to repay additional debts likely to be incurred and further that Eliopoulos was insolvent after the transfer to GEL were not supported by factual statements, insolvency [was] presumed” under DCL § 271(b) “where a debtor is ‘generally not paying the debtor’s debts as they become due other than as a result of a bona fide dispute.’”[23] “At the time of the conveyance to GEL,” explained the Court, “plaintiff had already been awarded two judgments of foreclosure and sale against Eliopoulos for her failure to make payments under two separate mortgage notes.”[24] “Further,” said the Court, “considering that the record reveal[ed] Eliopoulos may have ignored an information subpoena relating to her finances as to at least one of the deficiency judgments,” it was “satisfied that such financial information [was] within the knowledge of the parties alleged to have engaged in a fraud and which could be explored during disclosure.”[25] The Court rejected defendants’ contention plaintiff’s allegations were speculative because they were asserted “upon information and belief” and otherwise contrary to the documentary evidence:[26] Eliopoulos and Glenburnie LLC encumbered the Putnam parcels with $475,000 in mortgages from Mako, and then sold the Putnam parcels plus two other parcels — including at least one parcel not subject to a Mako mortgage that had deeded water access to Lake George — to GEL for $529,000. As highlighted by plaintiff, this means two parcels on Lake George — one with deeded lake access — were conveyed for approximately $27,000 each. Then approximately three years later, all four subject properties were sold to a third party for $1,250,000. Although GEL contends that the actual consideration for the June 2020 transaction was above $529,000 and that the subject properties were “unmarketable and worthless” because other potential buyers “would not pay anything, let alone fair market value,” for real property that was subject to multiple lawsuits, this is information within the knowledge of defendants and a “plaintiff may allege upon information and belief that defendants transferred assets for inadequate or no consideration.”[27] “When … recognizing that we are to afford the complaint a liberal construction, presume the alleged facts to be true, and afford plaintiff the benefit of every favorable inference when considering a motion to dismiss for failure to state a cause of action,” said the Court, “we are satisfied that the allegations contained in the complaint set forth a cognizable legal claim under the Debtor and Creditor Law.”[28] Takeaway The Legislature’s adoption of the Uniform Voidable Transactions Act modernized the State’s prior Debtor and Creditor Law, thereby enhancing creditor protections against fraudulent transfers. The revised law distinguishes between actual and constructive fraud, with the latter based on objective financial distress rather than intent. Actual fraud requires heightened pleading standards and is evaluated using codified “badges of fraud.” Neptune illustrates the law’s practical application: a property transfer to an insider during pending foreclosure actions was challenged as voidable. The Court found that even allegations made “upon information and belief” were sufficient when supported by factual context, such as insider status and undervalued consideration. Neptune also affirmed that insolvency can be presumed from missed payments and ignored subpoenas. Neptune reinforces the DCL’s focus on economic realities over formalities, thereby making it a powerful tool for creditors seeking redress for fraudulent transfers. ___________________________ Jeffrey M. Haber is a partner and co-founder of Freiberger Haber LLP. This article is for informational purposes and is not intended to be and should not be taken as legal advice. [1] This Blog examined the new DCL in an article titled, N.Y. Supreme Court Rules on Alleged Fraudulent Conveyance and the Attempt to Evade Creditors. [2] Uniform Voidable Transactions Act, L 2019, ch. 580, § 2 (eff. Apr. 4, 2020); L&M 353 Franklyn Ave. LLC v. Steinman, 202 A.D.3d 440, 440 (1st Dept. 2022); Van de Walle v Van de Walle, 68 Misc. 3d 1224(A), 2020 N.Y. Slip Op. 051064(U) (Sup. Ct., Nassau County 2020), aff’d, 200 A.D.3d 1095 (2d Dept. 2021). [3] Van de Walle, 68 Misc. 3d 1224(A). [4] DCL §§ 273(a)(1)-(2), 274(a)-(b), 276; see also Tian v. Top Food Trading Inc., No. 22-CV-0345 (EK) (VMS), 2024 WL 1051172, at *9 (E.D.N.Y. Feb. 26, 2024), adopted by 2024 WL 1908910 (May 1, 2024). [5] DCL § 273(a)(2). [6] Id. § 274(a). [7] Id. § 274(b). [8] Id. §§ 270(h)(2)(iii), (vi), (4). [9] 245 E. 19 Realty LLC v. 245 E. 19th St. Parking LLC, 80 Misc. 3d 1206(A), at *6 (Sup. Ct., N.Y. County 2023) (citing James Gadsden & Alan Kolod, Supplementary Practice Commentaries, McKinney’s Debtor and Creditor Law § 273 (2020)), affirmed as modified, 223 A.D.3d 604 (1st Dept. 2024). [10] In re Tops Holding II Corp., 646 B.R. 617, 649 (Bankr. S.D.N.Y. 2022). [11] DCL § 273(b); see also Matter of Schiffman v. Affordable Shoes, 238 A.D.3d 770, 773 (2d Dept. 2025); 245 E. 19 Realty LLC, 223 A.D.3d at 606. [12] See Louis Monteleone Fibres, Ltd. v. Hudson Baylor Brookhaven, LLC, 228 A.D.3d 641, 646 (2d Dept. 2024). [13] See Old Republic Natl. Title Ins. Co. v. 1152 53 Mgt., LLC, 227 A.D. 3d 824, 828 (2d Dept. 2024); Avilon Automotive Group v. Leontiev, 194 A.D.3d 537, 539 (1st Dept. 2021). [14] See generally Drip Capital, Inc. v. JY Imports of NY Inc., ___ F. Supp. 3d ___, ___, 348 F.R.D 536, 547 (E.D.N.Y. 2025). [15] See Avilon Automotive, 194 A.D.3d at 539; Carlyle, LLC v. Quik Park 1633 Garage LLC, 160 A.D.3d 476, 477 (1st Dept. 2018). [16] Pludeman v. Northern Leasing Sys., Inc., 10 N.Y.3d 486, 491-492 (2008); see Paolucci v. Mauro, 74 A.D.3d 1517, 1520-1521 (3d Dept. 2010); see generally CPLR 3211(d). [17] Pludeman, 10 N.Y.3d at 492; see Louis Monteleone Fibres, 228 A.D.3d at 647; Phone Admin. Servs. Inc. v. Verizon N.Y., Inc., 211 A.D.3d 493, 494 (1st Dept. 2022); cf. Carlyle, 160 A.D.3d at 477. [18] Slip Op. at *3. [19] Id. [20] Id. [21] Id. (citing DCL § 270(h)(1)(i); (2)(vi)). [22] Id. (citing 245 E. 19 Realty, 223 A.D.3d at 606; JDI Display Am., Inc. v. Jaco Elecs, Inc., 188 A.D.3d 844, 846 (2d Dept. 2020); DCL § 273(b)). [23] Id. at *4. [24] Id. [25] Id. (citation omitted). [26] Id. [27] Id. (quoting 477 Realty, L.L.C. v. Wing Soho, LLC, 234 A.D.3d 469, 471 (1st Dept. 2025)). [28] Id. (citing Pludeman, 10 N.Y.3d at 493; Paolucci,74 A.D.3d at 1521).