Strimling v. Armory Plaza, Inc.

Strimling v Armory Plaza, Inc. 2024 NY Slip Op 31746(U) May 20, 2024 Supreme Court, Kings County Docket Number: Index No. 45669/2007 Judge: Wayne P. Saitta Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service.

This opinion is uncorrected and not selected for official publication. .----------===::::::=-c:...==-.c=====e!!!!!!!!------==- FILED: KINGS COUNTY CLERK 05/20/2024 10:33 AM ~- ~~--- - - - - -- INDEX -- NO. ---- 45669/2007 NYSCEF DOC. NO. 1471 RECEIVED NYSCEF: 05/20/2024

At an an IAS lAS Term, Part 29 of Term, Part the Supreme of the Court Supreme Court of the the State State of New New York, York, held held in and and for the the County County of Kings, Kings, at the the Courthouse, Courthouse, at Civic Center, Center, Brooklyn, New York, Brooklyn, New York, on the 20th day the 20th day of of May May 2024.

2024.

PRESENT: PRESENT: HON. WAYNE SAITTA, Justice.

Justice. --------------------------------------------------,---------------X --------------------------------------------------~---------------J( ARTHUR ARTHUR STRIMLING, STRIMLING, LISA SEGAL, TIMOTHY TIM'OTHY PIETRZAK, CATHERINE PIETRZAK, CATHERINE SHANNON, BORIS SHANNON, BORIS GILZON, 393 16 th STREET STREET LLC, SVETLANA LAZAREV, and MEMORIAL BAPTIST and MEMORIAL BAPTIST CHURCH CHURCH OF BROOKLYN, '!II Index No. 45669/2007 Index 45669/2007 Plaintiffs Plaintiffs -against- -against- DECISION DECISION AND ORDER ORDER INC., ARMORY ARMORY PLAZA, INC., ARMORY HEIGHTS, HEIGHTS, LLC, JACK LOCICERO, LOCICERO, LORENZO LOCICERO, LORENZO LOCICERO, MS MS 86, 87&88 87&88 BRICOLAGE BRICOLAGE DESIGNERS, DESIGNERS, INC., HENRY HENRY RADUSKY, DOUGLAS PULASKI, PULASKI, SANCHEZ SANCHEZ ASSOCIATES ASSOCIATES P.C., XINGJIAN J(INGJIAN CONSTRUCTION, CONSTRUCTION, INC., DIAMOND DIAMpND POINT POINT CORP., d/b/a EXCAVATING CORP., d/b/a DIAMOND DIAMOND POINT POINT EXCAVATION CORP., CORP., and and JAFCO JAFCO GROUP.;INC., GROUP,;INC., Defendants Defendants ___________________________________________________ ~__-------------J( ,I 'I ---------------------------------------------------~---------------X The The following papers read following papers read on this motion: this motion: NYSCEF Doc NYSCEF Nos Doc Nos Notice of Notice of Motion/Order Motion/Order to Show Cause/ Show Cause/ Petition/ Affidavits (Affirmations) Petition/Affidavits (Affirmations) and and Exhibits Exhibits I Cross-motions Cross-motions Affidavits Affidavits (Affirmations) (Affirmations) I and Exhibits and Exhibits 1335-1356 Answering Affidavit (Affirmation) Answering Affidavit (Affirmation) 1370-1373 1416-1422 1430-1436 1370-13731416-14221430-1436 Reply Reply Affidavit Affidavit (Affirmation) (Affirmation) 1366-1369 1423-1429 1450 1366-13691423-14291450 Supplemental Supplemental Affidavit Affidavit (Affirmation) (Affirmation) I I: These motions These motions involve involve a fee dispute dispute between former Plaintiff, between former Plaintiff, 1504 REALTY LLC II II

(hereinafter "1504"), (hereinafter and its "1504"), and its former former attorne~s, attorne~s, Hiller Hiller PC. \\ I \ /I

I \l [* 1] FILED: KINGS COUNTY CLERK 05/20/2024 10:33 AM INDEX NO. 45669/2007 NYSCEF DOC. NO. 1471 RECEIVED NYSCEF: 05/20/2024

In In 2007, 2007, five of of the the Plaintiffs Plaintiffs were were represented represented by by Weiss Weiss & Hiller Hiller PC, a firm firm in which which Michael Michael Hiller, Hiller, Esq Esq ("Hiller") ("Hiller") was was a partner. partner. Subsequently, Subsequently, Arnoid Arnold Rosenshein, Rosenshein, a , I principal principal of of 1504, 1504, asked asked Michael Michael Hiller Hiller to to have have Weiss Weiss & Hiller Hiller PC represent represent 1504: 1504: Weiss Weiss . I . & Hiller & Hiller PC substituted substituted as counsel counsel for for 1504 150'4 in 2007, 2007, and and its its case case was was consolidated consolidated with with the the present present case. case. In In 2014, 2014, Michael Michael Hiller Hiller formed formed a new new firm, firm, Hiller Hiller PC, which which took took over over representation of representation of the the Plaintiffs, Plaintiffs, including including 1504.

1504.

In In 2019, 2019, 1504 1504 decided decided to to settle settle separately separately with with Defendants Defendants and and Hiller Hiller withdrew withdrew as its counsel. counsel. Hiller Hiller PC asserted asserted a charging charging l~en for for legal legal services services for for the the period period from from 20~4 2014 until until June June 2019 2019 when when they they withdrew withdrew as attprneys attprneys for 1504.

1504. A charging charging lien lien has has not not been been asserted asserted for for the the period period prior prior to to 2014 2014 when when 1504 1504 was was represented represented by by Weiss Weiss & Hiller Hiller PC.

1504 1504 moved moved to to vacate vacate the the lien, lien, arguing arguing that that Hiller Hiller PC is entitled entitled to to no no fees for the the ,fI . entire entire time time it represented represented 1504 1504 because because Hiller Hiller PC was was discharged discharged for for cause. cause. i504 i504 asserts asserts that that the the firm firm had had a conflict conflict in in representing representing the the Plaintiffs jointly from Plaintiffs jointly from the the beginning beginning of of the the representation representation due due to to the the possibility possibility that that there there would would not not be be sufficient sufficient assets assets to to satisfy satisfy the the claims claims of all the the Plaintiffs.

Plaintiffs.

Hiller Hiller PC cross cross moved moved to to have have the the Court Court set set the the lien. lien.

After After a 13-day hearing, the 13-day hearing, the Court Court issued issued aaDecision Decision and and Order Order dated dated June.24, June 24, 2022, 2022, ·!., which which denied denied 1504's 1504's motion motion to to vacate vacate Hiller Hiller PC's PC's lien lien and and reserved reserved decision decision on on Hiller Hiller PC's PC's motion motion to set set the the amount amount of of his his lien lien pending pending a framed framed issue issue hearing. hearing.

In that Decision Inthat Decision and and Order, Order, the the Court Court found found that that Hiller Hiller PC was was not not discharged discharged for cause, cause, but but that that Hiller Hiller PC moved moved to to be be relieted relieted as counsel counsel after after 1504 1504 informed informed Hiller Hiller PC that that it was was interested interested in in settling settling separately. separately'. Before Before the the return return date date of of the the motion, motion, 1504 1504 consented to consented to Hiller Hiller PC's PC's withdrawal withdrawal but but reserved reserved the the right right to to challenge challenge the the charging charging lien. lien.

The The Court Court also also found found that 1504 ha~ that 1504 had agreed agreed that that it would would be be billed billed for 50% 50% of of the the .

I I hours hours incurred. incurred. This This finding finding was was based based o~ the testimony of the testimony of Michael Michael Hiller Hiller and and several several other other of of the the Plaintiffs Plaintiffs as more more fully fully set set fo~ forth in. the decision inthe decision of of June June 24, 2022.

The The C~urt Court did did not not find find Arnold Arnold Rosenshein's Rosenshein's testimony testimony that that there there was was no no agreement agreement as to to how how the the hours would be hours would be split split among among the the Plaintiffs, Plaintiffs, to to be be credible. credible.

The The Court Court further found that further found that there there I was was not not an an actual actual . conflict conflict in III Hiller Hiller PC 'I representing representing multiple multiple Plaintiffs, Plaintiffs, and and that that a con(lict conflict only only arose arose at the the point point that that 1504 1504 decided decided to to pursue pursue a separate separate settlement. settlement. !

The The Court Court further further found found that that Hiller Hiller did did not not violate violate the the Rules Rules of of Professional Professional Conduct, as he Conduct, he had had advised advised his his clients clients of of the the potential potential conflicts conflicts involved involved in in representing representing a group group and and did did get get informed informed consent consent of of th~ the Plaintiffs Plaintiffs orally. orally. J

The The Court Court further further found found tliat that Hiller Hiller PC had had demonstrated demonstrated its its claim claim for for an an account account ., stated, stated, as Rosenshein Rosenshein did did not not make make specific specific objections objections to to the the accuracy accuracy of of the the invoices invoices and and had had made made several several promises promises to to pay pay the the outs~anding outstanding balance. . balance. r' '!

The The Court Court declined declined to to set set the the lien lien based based on on the the invoices invoices because because Hiller Hiller informed informed !'i the the Court Court that that some some on on the the invoices invoices included 100% of included 100% of the the hours hours incurred incurred rather rather than than 50%.

50%.

The The Court Court reserved reserved decision decision on on Hiller Hiller PC's cross-motion cross-motion to to set set the the lien, lien, pending pending aframed a framed .issue issue hearing hearing and and granted 1504 limited granted 1504 limited discovery discovery of of the the time time entries entries of of the the employees employees of of Hiller Hiller PC that that were were the the basis basis for the the invoices invoices sent sent to to 1504.

1504.

1504 has 1504 has moved moved to to renew renew its its motion motion to to vacate vacate the the charging charging lien, lien, and and has has moved moved for sanctions. Hiller PC has sanctions. Hiller has cross-moved cross-moved to to set set the the amount amount of of the the lien lien without without further further hearing, hearing, and sanctions. .. and for sanctions

1504's Motio n to 1504' s Motion Reneww to Rene 1504 bases denial of the denial its motion of its vacate the to vacate motio n to lien the lien 1504 bases its its current curren t motion motio n to renew renew the ., ., on on the the time time entry entry records record s it it received part of received as part discovery. that discovery. of that 1504 argues entiie s are newly discovered are newly which evidence which discovered evidence 1504 argues that that the the time time entties demonstrates supportrt of tted in suppo lien and his lien testim ony his testimony demon strates that that Hiller's Hiller's affirmations submitted affirmations submi of his and his at the at the hearing hearin g were were false and should false and be disreg should be arded by disregarded Court. the Court. by the As inconsistencies go alleged inconsistencies the wheth er the to whether As aa preliminary prelim inary matter, matte r, none none of of the the alleged go to parties wheth er Hiller hours; whether had an Hiller had actual conflict an actual in conflict in parties had had agreed agreed to to a 50/50 50/50 split split of hours; representing he advised wheth er he his clients advised his the potential of the clients of conflicts potent ial conflicts representing multiple multip le Plaintiffs; Plaintiffs; or or whether in joint repres entati on. joint representation.

The record s and time records the time the invoices go to invoices go the to the The alleged alleged inconsistencies inconsistencies betweel1 betwee11 the and the share of of hours actuallyly billed billed to to 1504, which Court did the Court which the not determine did not as part determ ine as the of the part of share hours actual June 24,2022 June decision, 24, 2022 decisi on, but but reserved frame d issue for a framed reserved for hearin g. issue hearing.

More l the voluminous throug h the time entries volum inous time and entrie s and More importantly, impor tantly , once once one sorts 1 through one sorts invoices, suppo rt the not support assert ion that the assertion lied in Hiller lied that Hiller his in his invoices, it it becomes becomes apparent appar ent that that they they do not I II testimony testimony or in his or in affidavits. his affidavits. I . I

To in November affidavit in of 2020 Novem ber of that 1504 2020 that To begin begin with, with, Hiller Hiller acknowledged acknowledged in an affidavit 1504 !, • had betwe en 2016 invoices between the invoices and 2018, 2016 and 2018, and also and also had been chargedd 100% been charge of the 100% of the hours hours on on the acknowledged wledged that that fact fact during during the hearin g on the hearing the motion on the to vacate motio n to lien. the lien. vacate the ackno The main contention the entries the hours of the entrie s of the employees by the hours by of employees of The main conten tion of of 1504 is that that the Hiller Hiller PC PC do do not not reflect reflect the 50/50 split the 50/50 of hours split of testified to hours testified Hiller. by Hiller. to by It of hours the,entry of by the hours by and emplo attorn eys and the attorneys yees It appears appea rs that 1504 is conflating that 1504 conflating the,entry employees of prepa red by the office by the and Bent manag er and to .sent to of Hiller Hiller PC PC with with the the invoices invoices that that were were prepared office manager Rosenshein princi pal of Rosenshein as principal of 1504.

,,4

Hiller Hiller testified testified that that originally, originally, the the employees employees were were instructed instructed to to split split their their hours hours 50% to Rosenshein Rosenshein and and 50% 50% to the the other other ~trimling ~trimling Plaintiffs.

Plaintiffs.

Hiller testified that Hiller testified that the the employees employees were ~ere not not splitting splitting their their hours hours consistently, consistently, so in 2014 2014 he instructed the he instructed the employees employees to allocate allocate all of the the hours hours to to Rosenshein Rosenshein and and instructed instructed his assistant assistant office office manager, manager, Irene Irene Moy, who who was responsible responsible for preparing the for preparing the invoices invoices from from the the employee's employee's time time slip slip entries, entries, to split split the the hours hours listed listed in in .the the entries, entries, and and allocate allocate 50% to Rosenshein Rosenshein and and 50% 50% to the the other other Strimling Strimling Plaintiffs.

Plaintiffs.

The The email, email, dated dated May May 14, 2014, 2014, instructing instructing Moy Moy to split split the the hours hours 50% 50% to Rosenshein Rosenshein and and 50% 50% to to the the other other Strimling Strimling Plaintiffs, Plaintiffs, was was introduced introduced at at the the hearing. hearing.

Hiller Hiller testified testified that that the the hours hours on th~ invoices invoices were were split until January split until January 2016 2016 when when Gina Gina Mungioli Mungioli was was hired hired as office managJr. He testified officemanag~r. testified that that unbeknownst unbeknownst to him, him, the the new new office manager manager was was not not splitting splitting the the time time slip slip entries entries 50% 50% to to Rosenshein Rosenshein and and 50% 50% to the the other other Strimling Strimling Plaintiffs, but instead Plaintiffs, but instead whs wns including including 100% 100% of of the the hours hours on on the the invoices invoices to Rosenshein.

Rosenshein.

Hiller Hiller testified testified that that he he did did not not instruct instruct the the new new office office manager manager to to include include 100% 100% of the the hours hours on the the invoices invoices to Rosenshein.

Rosenshein. He He stated stated that that he believes that he believes that the the new new office manager manager did did not not see see the the 2014 2014 email email to to splitthe splitthe time time entries entries 50% 50% to to Rosenshein Rosenshein and and 50% 50% I I. to the the other other Strimling Strimling Plaintiffs.

Plaintiffs.

Hiller testified at Hiller testified at the the hearing hearing that that Rosenshein Rosenshein was billed for was billed for 100% 100% of the the hours hours from from January January 2016 2016 until November 2018. until November 2018.

Hiller Hiller testified testified that that he he discovered discovered that that Rosenshein Rosenshein had been billed had been billed for for 100% 100% of the the hours hours as a result result of investigating investigating a claim by 1504's claim by 1504's attorney, attorney, made made during during the the course course of the the motion vacate, that motion to vacate, that Rosenshein Rosenshein had been billed had been billed for 100% 100% of the the hours. hours.

;

1504 argues 1504 argues that that the the timeslip timeslip entries, after the disclosed after entries, disclosed decision, the decision, contradict contradict Hiller's Hiller's testimony testimony and and his his Supplemen Affidavit of Supplementaltal Affidavit November 20, of November 2020 that 20, 2020 was· there was. that there agreement agreement to to split split the the hours hours 50% to to Rosenshein Rosenshein and to the and 50% to other Strimling the other Plaintiffs.

Strimling Plaintiffs.

1504 further 1504 further argues argues that that the the time time entries that Hiller demonstra te that entries demonstrate his instructed his Hiller instructed staff staff in late late 2015 to to bill bill 100% to Rosenshein, and to Rosenshein, that they and that routinely billed they routinely their of their billed 100% of time time to 1504 starting in 2016. starting in Again, 1504 is conflating Again, 1504 conflating two two distinct practices. The distinct practices. how the first is how The first and attorneys and the attorneys other other employees employees allocated allocated their their hours when they hours when entered their they entered time. -The their time. is second is -The second whether whether the the office office manager manager split split the the time entries 50% to Rosenshein time entries and 50% to Rosenshein and other the other to the Strimling Strimling Plaintiffs in preparing Plaintiffs in invoices. the invoices. preparing the Similarly, misconstru es the Similarly, 1504 misconstrues that Moy fact that the fact of her billed 100% of Moy billed to time to her time Rosenshein Rosenshein after 2016. Hiller's after 2016. Hiller's testimony was that testimony''I1was Moy's job was Moy's that it was office assistant office job as assistant manager manager to to prepare prepare the the invoices to split and to invoices and the time split the entries in time entries preparing the in preparing invoices. the invoices. ir'I After 2016, when After 2016, when she she was was working working on on this case entering this case exhibits in entering exhibits she notebooks, she in notebooks, allocated 100% of allocated 100% of those those hours hours to Rosenshein. This to Rosenshein. was consistent This was with the consistent with to directive to the directive employees employees working working on on the the case case to allocate all of to allocate their hours of their Rosenshein. It to Rosenshein. hours to It was then was then up up to to the the new new office office manager, manager, not not Moy, to split Moy's to split hours between Moy's hours Rosenshei n and between Rosenshein the and the other other Strimling Plaintiffs.

Strimling Plaintiffs.

The The time time entries entries demonstrate demonstra te that number of that a number the invoices of the are not invoices are but accurate, but not accurate, they they do not not actually actually contradict contradict Hiller's Hiller's testimony beginning in 2014 that beginning testimony that 2014 he his instructed his he instructed employees employees to to allocate allocate 100% of of the the hours to Rosenshein hours to and that Rosenshein and his new that his manager office manager new office failed failed to to split split the the time time entries entries 50% to Rosenshein and to Rosenshein to the and 50% to Strimling other Strimling the other Plaintiffs.

Plaintiffs.

Further, Further, contrary the contention contrary to the contention of 1504, the Court 1504, the Court did did not not rely rely on on the the 2020 2020 spreadsheet spreadsheet prepared prepared by Gina Mungioli. The Gina Mungioli. The Court Court did did not not consider consider the the spreadsheet spreadsheet in in reaching reaching its its decision decision because Hiller admitted because Hiller that it contained admitted that contained inaccuracies. inaccuracies. Also, Also, the the spreadsheet was not spreadsheet was not a record record regularly regularly kept kept in the the course course of of business, business, nor nor was was it a summary summary of business records of business that had records that had been been made made available available to 1504.

1504.

Further, Further, although the Court although the Court found found that that Hiller Hiller PC made made out out its its case case for for an an account account stated, stated, Hiller's Hiller's admission that some admission that some ofthe of the invoices invoices included included 100% of the hours, 100% ofthe hours, precluded precluded setting setting the the amount amount of the lien based the lien based on on the the invoices invoices alone. alone.

The The Court Court declined declined to use use the the 2020 2020 spreadsheet spreadsheet to determine determine which which of of the the invoices invoices included included more more the the 50% of the 50% of the hours, hours, and and instead instead directed directed a framed framed issue issue hearing hearing be be held held to determine determine which which of the the invoices invoices sent sent to 1504 included more 1504 included more than than 50% 50% of of the the hours. hours.

As set As set forth forth above, the time above, the time entries entries disclosed disclosed after after the the decision decision do not not contradict contradict the the testimony testimony of Hiller.

Hiller. They They do not not contradict contradict the the findings findings of the the Court Court that that 1504 agreed 1504 agreed to a 50/50 50/50 split split of the hours, that the hours, that Hiller Hiller w~s was not not discharged discharged for for cause, cause, or or that that Hiller Hiller did did not not violate the Rules violate the of Professional Rules of Professional Responsibility Responsibility in representing representing the the Plaintiffs.

Plaintiffs.

Therefore, Therefore, 1504's motion to renew 1504's motion renew must must be denied. denied.

I I 'I

Hiller Hiller PC's cross-motion cross-motion Hiller Hiller PC cross-moves to set cross-moves to set the the amount amount of a lien lien without without a framed framed issues issues hearing hearing arguing that arguing the spreadsheets that the submitted by spreadsheets submitted by both both sides sides resolve resolve any any questions questions of of fact fact as to which which invoices invoices contained more than contained more than 50% 50% of the the hours. hours.

In the the decision decision of June 24, 2022, of June 2022, the the Court Court held held that that Hiller Hiller PC had had established established its its claim for an claim an account account stated but declined stated but declined to set set the the amount amount of the the charging charging lien lien because because Hiller admitted that Hiller admitted that a number number of the the invoices invoices sent sent to 1504 were based 1504 were based on on 100% of the 100% of the

Hiller PC argues Hiller argues that that there there is only only aCl small small number number of of invoices invoices that that are are actually actually in dispute. Hiller PC that dispute. Hiller points out that points out that that it has has not not asserted asserted a lien lien for for any any charges prior to charges prior 2014, the point when the point when Hiller Hiller PC took took over over representation representation from from Weiss Weiss & Hiller Hiller PC, and and that that it did did not not send send any any invoices invoices to 1504 after November 2018. after November . i Hiller Hiller PC further further argues argues that that there there is no need need for for a hearing hearing as to to the the invoices invoices covering the covering period from the period from January January 2016 through November2018 through November because it concedes 2018 because concedes that that those those invoices invoices included included 100% of of the the hours. hours.

Hiller PC argues Hiller argues that that a hearing hearing is not not needed needed about about the the invoices invoices from from 2014 and and 2015 because because the the amount amount owed owed can be determined can be determined from from comparing comparing spreadsheets spreadsheets included included in the papers submitted the papers submitted by both parties. by both parties.

However, it is not However, not clear clear from from eitherthe either the 2020 2020 or or 2023 2023 spreadsheets spreadsheets submitted by submitted by Hiller PC which Hiller which invoices contained 100% of invoices contained the hours. cifthe hours.

Further, Further, the the spreadsheets spreadsheets submitted by Hiller submitted by Hiller PC contain contain many many adjustments adjustments to the the account account for perceived perceived errors errors in the the time time entries. It is not entries. It not entir~ly entir~ly clear clear from from the papers the papers whether Hiller PC is seeking whether Hiller seeking to to adjust adjust for for alleged undercharges during alleged undercharges during the period of 2014 the period through through 2016.

More importantly, the More importantly, the invoices invoices not not the the spreadsheets spreadsheets are are not not the basis for the basis for the the account account stated stated claim. claim.

The framed The framed issue issue hearing hearing is necessitated by the necessitated by the fc;1.ct fe;t.ctthat that Hiller Hiller PC concedes concedes that that the the hours hours were were not not split split on many many of the the invoices. invoices. The The sole sole issue issue to be determined to be determined at at the the

To make make this this determination determination the the Court Court must must compare compare the the invoices invoices to to the the time time slip slip entries for the entries for the same period of same period of each each invoice'.

Sanctions Both Both sides sides have have sought sought sanctions sanctions against against their their adversary adversary in in connection connection with with this this motion motion and and cross-motion. cross-motion. While While the the Court Court is denying denying both both the the motion motion and and cross-motion, cross-motion, ; " neither neither was was so devoid devoid of of merit merit as to to be be frivolous frivolous or or sanctionable. sanctionable.

WHEREFORE, WHEREFORE, it it is ORDERED ORDERED that that the the motion motion of of 1504 to to renew, renew, and and its its motion motion for sanctions sanctions are are denied; denied; and and it is further, further, ORDERED, that ORDERED, that Hiller Hiller PC's PC's motion motion ,~o set the ;~oset the amount amount of of its its charging charging lien lien based based on on the the papers papers submitted, submitted, without without a framed framed issue issue hearing, hearing, and and for for sanctions, sanctions, is denied. denied.

This constitutes the This constitutes the Decision Decision and and O~der O~der of of the the Court.

Court.

ENTER: ENTER:

St ~ · JSC HON. WAYNE WAYNE SAITTA J.S.C. J.S.C.

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