Yellowstone Injunction | Neighbors’ Cameras | Tithing

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Yellowstone Injunction Denied When Tenant’s Breach Is Incapable Of Cure

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In Booston LLC v. 36 W. Realty Co. LLC, a commercial tenant, Booston LLC, moved for a Yellowstone injunction to maintain the status quo to protect its interest in its leasehold and obtain a stay tolling the time for it to cure a default and avoid forfeiture.  The landlord alleged the tenant violated the lease rider by failing to furnish and continue sufficient insurance coverage on the premises.

Since the Court of Appeals’ decision in First Nat’l Stores v. Yellowstone Shopping Ctr., 21 N.Y.2d 630, 290 N.Y.S.2d 721 (1968), tenants have developed a practice of obtaining a stay of the cure period before it expires to preserve a lease until the merits of a dispute over the default notice may be resolved in court (i.e., a “Yellowstone” injunction).  Effectively, tenants have learned from the mistake of the tenant in the case of Yellowstone who commenced an action for declaratory judgment on the last day of the cure period, but did not obtain a temporary restraining order.  The Court of Appeals ultimately held that in absence of the injunction, it was powerless to revive the expired lease.  Significantly, the courts have since granted such injunctive relief on less than the normal showing required for a preliminary injunction because of the threat of a forfeiture of the valuable leasehold interest.

Thirty years later, the Court of Appeals revisited its Yellowstone decision in the case of Grabuard Mollen Horowitz Pomeranz & Shapiro v. 600 Third Ave. Assocs., 93 N.Y.2d 508, 693 N.Y.S.2d 91 (1999).  In that case, the Court of Appeals analyzed what it recognized was the seminal decision to a “new era of commercial landlord-tenant law in New York State[,]” creating a “remedy for tenants when confronted with a tangible threat of lease termination.”

Importantly, in reaffirming the standards which a party requesting the Yellowstone injunction must demonstrate, the Court of Appeals re-enforced the restrictive nature of the common law remedy that has evolved out of its original decision in Yellowstone, concluding that “[t]hese standards reflect and re-enforce the limited purpose of a Yellowstone injunction: to stop the running of the applicable cure period.”

So it is a well-established tenet in Yellowstone applications that if the application is made after the expiration of the cure period, and even before the expiration of subsequent notice of termination of lease, a court is divested of any power to issue the injunction, regardless of the merits of the tenant’s position on the default, because the court cannot “stop” what has already run.

Several of our prior newsletters reported on decisions where Yellowstone injunctions were denied for the simple reason that a tenant cannot cure an incurable default.  Many of those decisions dealt with the tenant’s failure to obtain the required insurance coverage under a lease and make clear that a tenant obtaining a prospective insurance policy does not protect a landlord against unknown claims that might arise during the period in which no coverage existed.

That is what happened in this case:  the tenant did not keep in effect public liability coverage against claims for bodily injury or death in the amount of $2,000,000 in a single limit or under an original policy with an umbrella as the lease required, but instead furnished the landlord with an insurance certificate showing such coverage only in the amount of $1,000,000 in a single limit, and it failed to name the landlord as a named insured, in further violation of the insurance clause.  The tenant maintained that this breach was waived as it delivered to landlord copies of its insurance certificates for more than five years without objection, while accepting tenant’s rent payments.

The Court found this waiver argument “unavailing” because the lease contained a common provision entitled “No Waiver” that stated:

The failure of Owner to seek redress for violation of, or to insist upon the strict performance of any covenant or condition of this lease or any of the Rules or Regulations set forth or hereafter adopted by Owner, shall not prevent a subsequent act which would have originally constituted a violation from having all the force and effect of an original violation.  The receipt of owner of rent with knowledge of the breach of any covenant of this lease shall not be deemed a waiver of such breach and no provision of this lease shall be deemed to have been waived by Owner unless such waiver is signed by Owner….

The Court concluded that the tenant’s waiver argument “is, thus, clearly barred by the terms of the parties’ Lease.  In addition, putting aside the No Waiver clause that dictates the result herein, ‘[a] necessary lynchpin of a Yellowstone injunction is that the claimed default is capable of cure.’ If ‘the claimed default is not capable of cure, there is no basis for a Yellowstone injunction.’  The First Department has held that failure to procure insurance cannot be cured where the proposed cure does not involve ‘any retroactive change in coverage, which means that the alleged defaults raised by the landlord are not susceptible to cure’ and, therefore, there is no basis for a Yellowstone injunction.  The rationale for the First Department’s decisions is simple: a deficiency in past insurance coverage ‘does not protect the landlord against the unknown universe of any claims arising during the period of no insurance coverage.’  This rationale squarely applies here and as there is no means for the Tenant to obtain retroactive insurance coverage, the Yellowstone injunction must be denied.”

Homeowners Cannot Order Neighbors To Redirect Or Remove Cameras

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In Ienopoli v. Lent, the petitioners homeowners sought an order directing the respondents neighbors to remove or redirect their cameras under Civil Rights Law § 52-a alleging they are aimed at petitioners’ property, without consent, believing it was done with the intent to annoy, harass or threaten petitioners.

New York Civil Rights Law § 52-a gives an owner of residential real property “a private right of action for damages” against anyone “who installs or affixes a video imaging device” on property adjoining their residential real property with “the purpose of videotaping or taking moving digital images of the recreational activities which occur in the backyard of the residential real property without the written consent thereto of such owner,” when such action is taken “with intent to harass, annoy or alarm another person, or with intent to threaten the person or property of another person.”

A “backyard” is defined as “that portion of the parcel on which residential real property is located which extends beyond the rear footprint of the residential dwelling situated thereon, and to the side and rear boundaries of such parcel extending beyond the rear footprint of such residential dwelling.”

According to the decision, petitioners and respondents are neighbors residing at 9 Jerry Lane and 7 Jerry Lane, Glen Cove, New York, respectively. The parties’ properties abut and their backyards share a common fence line.  Petitioners claimed that respondents installed numerous cameras on their property aimed at petitioners’ property, including their backyard and windows, without petitioners’ consent.  Petitioners believed that the cameras were installed with the intent to harass, annoy, and alarm them, or with the intent to threaten petitioners’ person or property.

In addressing the requested relief under the statute, the Court was presented with photographs of the cameras, but it found it “impossible to discern from the photographs alone where the cameras are focused and if they indeed are aimed at petitioners’ windows and backyard as petitioners allege.  And aside from what the Court referred to as petitioners’ “bare statement” made “upon information and belief,” that the cameras were installed “with the intent to harass, annoy or alarm…or with the intent to threaten the person or property…there is no evidence submitted to establish same.”

In opposition, the respondents submitted an affidavit stating that the cameras were installed after the petitioners allegedly threatened him stating in sum and substance “You are this close to me burning your house down,” while putting his fingers close together as he said “this close.”  Respondent further stated that he installed the cameras “solely for the purpose of protecting his family and his property.”  He claimed that “the cameras do not tape or image petitioners’ backyard and were not installed to annoy, harass, or threaten petitioners.”

The Court concluded that the injunctive relief petitioners sought was not provided for by the plain language of the statute that provides for “a private right of action for damages.” Here, the petitioners sought “equitable relief in the form of an order directing respondents to redirect or move their cameras.” Additionally, it concluded “petitioners fail to establish that respondents installed their cameras with the requisite intent prohibited by the statute.”  The Court concluded that “nothing in the statute or the Sponsors Memorandum suggests that Civil Rights Law § 52‑a was enacted in any part to curtail the rights of property owners to secure their property through the use of security cameras.  Thus, petitioners fail to establish their entitlement to an order directing the removal or redirection of respondents’ cameras.”

Action Over Proper Tithe Amount Is Non-Justiciable

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In Wilson v. Christ Alive Christian Cntr., the defendant Church moved for summary judgment in an action by an ex-member, Wilson, who tithed $230,000 to the Church from a $2.3 million litigation award.

According to the decision, sometime in 2003, Wilson was involved in a motor vehicle accident that tragically took the lives of her husband and two children.  A lawsuit culminated in an award of $2,305,246.70 of which $1,900,000 was placed into a structured settlement and $405,247.70 was immediately paid to Wilson.  In 2007, Wilson voluntarily tithed $230,000 to the Church.  Five years after she made the tithing, she wanted the entire amount back, arguing that she was confused after being “counseled” by the Church’s pastor as to the proper tithe amount.  She testified that she intended to tithe 10 percent of her structured settlement monthly payments, not the 10 percent of the gross settlement recommended by the pastor.  She claimed “confusion” on her part — but she did not allege that the $230,000 was procured through fraud or duress.

In addressing the Church’s motion for summary judgment, the Court recognized that the “First Amendment forbids civil courts from interfering in or determining religious disputes, because there is substantial danger that the state will become entangled in essentially religious controversies or intervene on behalf of groups espousing particular doctrines or beliefs.  Judicial involvement is permitted when the case can be decided solely upon the application of neutral principles of…law, without reference to any religious principle.”

The Church argued that the action should be dismissed because it presented “non-justiciable ecclesiastical issues as to the religious interpretation of church doctrine concerning biblical tithing.”  Wilson countered, arguing that the First Amendment could not operate to shield the Church from liability “for exploiting a cognitively impaired, emotionally vulnerable woman.”  The Court held that “unfortunately for plaintiff, no matter how the inquiry is framed, it requires the issue of what would have been a proper tithe under these circumstances to be litigated in this forum, which is constitutionally impermissible.”  The Court concluded that although this was a “seemingly ‘unjust’ result,” it was nevertheless “constitutionally constrained to dismiss this matter as nonjusticiable.”

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