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Axginc Corp. v. Plaza Automall, Ltd.

United States District Court for the Eastern District of New York

February 15, 2017, Decided; February 21, 2017, Filed

14-CV-4648 (ARR) (VMS)

Opinion

OPINION AND ORDER

ROSS, United States District Judge:

In February 2007, the City of New York leased a parcel of land at the South Brooklyn Marine Terminal ("SBMT") in Sunset Park, Brooklyn to plaintiff, Axginc Corporation ("Axginc"). Axginc then sub-leased a portion of that land to defendant, Plaza Automall, Ltd. ("Plaza"). Axginc brings this action against Plaza to recover unpaid rent from April 2012 to [*2]  September 2013 and from January to June 2014. Plaza admits that it failed to pay the amount due under the sublease agreement between the parties during those months, but asserts affirmative defenses of modification, waiver, commercial impracticability, frustration of purpose, and fraudulent inducement. Axginc has moved for summary judgment on its own breach of contract claim and on Plaza's counterclaims, which mirror the affirmative defenses. For the reasons that follow, Axginc's motion for summary judgment is granted.

FACTUAL BACKGROUND

Plaintiff, Axginc, is a company that performs "[t]hird-party logistics" for the automobile industry. Deposition of David Alvarez ("Alvarez Dep."), Decl. of Christina H. Bost Seaton ("Bost Seaton Decl.") Ex. 1, ECF No. 45-1, at 16:20-17:8. Specifically, Axginc contracted with automobile manufacturers to perform services for them such as transporting and storing vehicles. Id.

On February 2, 2007, Axginc entered into a fifteen year lease ("the ground lease") with the City of New York Department of Small Business Services for a large portion of waterfront land at SBMT. See Lease Agreement between the City of New York Department of Small Business Services [*3]  and Axis Group,1 Decl. of John F. Blount, Esq. ("Blount Decl.") Ex. B, ECF No. 46-2. Axginc and the City of New York planned that Axginc would develop an automotive processing facility on the land that would bring new jobs and boost the local economy. See Press Release, New York City Economic Development Corporation, NYCEDC Signs Lease with Axis Group for 74-Acre Brooklyn Site (Feb. 26, 2007), Bost Seaton Decl. Ex. 11, ECF No. 45-11. Specifically, they planned to develop the land to host a working port, to which automobiles would be delivered, and a processing facility, at which automobiles intended for wholesale distribution would be processed. Id. at 2. However, at the time Axginc and the City of New York entered into the ground lease, the land lacked essential infrastructure required to build this facility. Id. at 1.

Defendant, Plaza, operates a car dealership on Nostrand Avenue in Brooklyn. See Deposition of John Rosatti ("Rosatti Dep."), Bost Seaton Decl. Ex. 6, ECF No. 45-6, at 24:5-15; Alvarez Dep. at 20:8-11. At some point prior to 2007, Plaza entered into an agreement with the City of New York to lease a portion of the land at SBMT to store its excess automobile inventory. See Rosatti Dep. [*4]  at 55:5-14; Deposition of Anthony Aquilino ("Aquilino Dep."), Bost Seaton Decl. Ex. 2, ECF No. 45-2, at 54:12-55:5.

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2017 U.S. Dist. LEXIS 227928 *; 2017 WL 11504930

AXGINC CORPORATION, f/k/a AXIS GROUP, Inc., Plaintiff, -against- PLAZA AUTOMALL, LTD., Defendant.

Notice: Designated as not for publication on the slip opinion.

CORE TERMS

Sublease, rent, lease, inducement, Invoices, impracticability, fraudulent, frustration, Landlord, monthly, modification, procure, flood, counterclaims, sophisticated, partial, waived, indemnify, destroyed, inventory, Terminal, Emails, movant, space