Rui Qin Chen Juan, et al. v. 213 West 28 LLC

The First Department has ruled in favor of Rosenberg & Estis, P.C.'s client, affirming a Supreme Court decision and order (Hagler, J.) that denied the plaintiffs-tenants' motion for a Yellowstone injunction. In the underlying action, commercial tenants in R&E's client's building brought a Yellowstone motion after their landlord served a notice to cure alleging, among other defaults, that the tenants were in breach of the lease due to their failure to maintain adequate insurance throughout the term of the lease. After briefing and oral argument on the tenants' motion, the Supreme Court found, inter alia, that the insurance policies produced by the tenants contained the following deficiencies in breach of the lease: (1) the tenants' insurance policies contained gaps in coverage, including an admitted two week gap; (2) the tenants' policies failed to include the landlord or its predecessors as additional insureds; (3) the tenants failed to maintain insurance in an amount of not less than $3,000,000 per occurrence; and (4) all insurance was in the name of a non-tenant third-party entity. Accordingly, the Supreme Court held the tenants' breaches incurable and denied the Yellowstone motion. On appeal, the First Department agreed with R&E and the Supreme Court that the tenants' failure to maintain adequate insurance throughout the term of the lease is a material breach that may not be cured by the purchase of prospective insurance, and further agreed with R&E, as a threshold matter, that the tenants provided no factual support for their Yellowstone motion "because the sole source of support for the motion was the English language affidavit of the non-English-speaking Rui Qin Chen Juan, which is inadmissible for want of a translator's affidavit, as is required by CPLR [2101(b)] and Rule 14(a) of the New York County Supreme Court, Civil Branch, Rules of Justices." For those reasons, the Court affirmed the Supreme Court's denial of the motion.

(The Supreme Court, Appellate Division, First Department, Decided April 18, 2017)
(Rosenberg & Estis, P.C. Team: Joshua Kopelowitz and Ilya Prokopets)