Southern Associates, Inc. v. United Brands Co.

Lupiano, J.

(dissenting in part). While I subscribe to the rationale expressed by Justice Fein in dissent, I express no view with respect to his observation that there is no reason to "search the record” and grant summary judgment in favor of plaintiff, who has not even appealed. There is no basis presented on this record for concluding, as thé majority have done, that, although the record title may have changed and although different businesses or entities may have asserted in varying contexts a claim to be landlord, the fact that the principals of those businesses or entities are the same, renders academic defendant’s assertion that plaintiff is not entitled to the rent because one of the other businesses may be so entitled. The affidavit submitted by Sol Goldman is not a complete answer to the tenant’s fear and does not serve to eliminate any question of fact raised by the tenant’s assertion that Great South Bay is its landlord. In effect, Mr. Goldman’s assertion is that these various businesses were operating under the famous dictum of Dumas’ "Three Musketeers”— "All for one, one for all.” Apart from the legal concept of "piercing the corporate veil,” separate corporations and business entities may be held to constitute a single unit in legal contemplation where each busienss is so related to, or organized or controlled by, the other as to be its mere agent, instrumentality, or alter ego (see Shelton Holding Corp. v 150 East 48th St. Corp., 264 NY 339, 344). There is no convicing demonstration on this record, other than conclusory assertions, which would permit concluding, as a matter of law, that each of the business entities which might be entitled to the rent is a mere agent or alter ego of the others.

Accordingly, to direct that the funds representing the rent payments go into plaintiffs coffers may be a disservice to the creditors, if any, of the other business entities which might be entitled to such fund.

Birns, J. P., and Evans, J., concur with Sullivan, J.; Fein and Lupiano, JJ., dissent in part in separate opinions.

Order, Supreme Court, New York County, entered on September 7, 1978, reversed, on the law, summary judgment granted to plaintiff for the $52,500 base rent demanded in the complaint, plus interest on the installments from the respective due dates, the New York County Clerk directed to pay plaintiff the fund of $52,500 heretofore deposited by defendant pursuant to order of this court staying enforcement of the order appealed from, plus any interest accrued from the date of deposit, as a credit against the $52,500 plus interest, and the matter remanded to Special Term for determination of the additional rents payable to plaintiff under the lease. Appellant shall recover of respondent $50 costs and disbursements of this appeal.