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7th Judicial District


Decisions of Interest - July 2007 - Present


Mass Factory, Inc. v. Walter C. Taylor Agency, Inc.

Index #2005-05807 (Sup. Ct. Monroe Co. September 28, 2007)
Broker’s common law duty to obtain requested coverage: elements of breach of contract claim and distinct negligence claim - summary judgment precluded by issue of fact concerning the parties’ prior practice and pattern of insurance procurement for her various commercial properties and the precise conversation had between the parties when she was told she was "all set," and that the insurance company had "picked her up." Prior relationship between the parties failed to support breach of fiduciary duty claim, which was dismissed. Third party action by broker/agent against insurance company seeking common law and contractual indemnification by reason of the failure of the insurance company to follow its internal procedures for processing requests for insurance was not available, warranting dismissal of third party complaint. Waiver of arbitration clause in agency agreement. Broker/agent’s motion to amend to add negligence claim to third party complaint granted.

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Maronian v. Provenzano

Index #2007-07056 (Sup. Ct. Monroe Co., October 10, 2007)
Stay under CPLR 2201 pending resolution of Michigan and local federal actions granted notwithstanding lack of complete identity of parties and claims.

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Matter of Kosakowski v. Pebble Beach Estates

Index #2007-11259 (Sup. Ct. October 10, 2007)
Arbitration clause does not authorize dismissal under CPLR 3211 (only arbitration and award will support dismissal). Court on motion to dismiss, and in the absence of a motion to compel arbitration may only order a conditional stay without a direction compelling arbitration.

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DiMarco Contractors, Inc. v. MDR Electric, Inc.

Index #2007-02537 (Sup. Ct. Monroe Co. October 12, 2007)
Summary judgment motion may not be supported by answers to notice to admit when the notices to admit do not merely concern clear cut matters but largely involve material or fundamental issues and ultimate facts. Form selection clause enforced.

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Conifer Realty, LLC v. Catholic Health Systems, Inc.

Index #2005-02265 (Sup. Ct. Monroe Co. November 1, 2007)
Reargument denied - Price term calling for payment "up to maximum 15%" of contract price as a developer’s fee held fatally indefinite. Reward context distinguished.

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Woodcliff Associates, L.P. v. Widewaters Hotels LLC

Index #2007-00693 (Sup. Ct. Monroe Co. November 2, 2007)
Collection agreement resulting from arm’s length business transaction between commercial entities, under which defendant’s duties merely consisted of collecting accounts receivable and paying them over less a percentage fee, did not create an escrow or otherwise create a fiduciary obligation. No resulting trust created on facts. Summary judgment granted dismissing breach of fiduciary duty claim.

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Thompson v. McQueeny

Index #2007-07194 (Sup. Ct. Monroe Co. November 6, 2007)
Summary judgment granting specific performance of a letter agreement calling for assignment of patents to plaintiff, which was executed as part of a broader asset purchase agreement extinguishing substantial corporate debt. Cross-motion for rescission/reformation denied. Mutual mistake not established merely because one party remained ignorant of legal effect of Terminal Disclaimer accompanying issuance of related patent when other party to agreement insisted on language protecting himself in the event that Terminal Disclaimer effectively prevented realization of the benefit of one part of the deal.

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Mass v. National Indemnity Company

Index #2002-05602 (Sup. Ct. Monroe Co. November 15, 2007)
Motion to vacate note of issue denied because no formal discovery requests were pending when note of issue filed. No special, unusual or extraordinary circumstances supported post note of issue discovery.

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Latona v. Donner

Index #2007-07014 (Sup. Ct. Monroe Co. November 16, 2007)
Motion under CPLR 6401 to appoint temporary receiver for LLC denied. No clear evidentiary showing of necessity to conserve endangered property and prevent irreparable loss. Insufficient demonstration of waste or mismanagement, or of dissipation. LLCL only authorizes appointment of receiver upon dissolution.

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Flasher Flare South East, Inc. v. R.A.K. Industries

Index #2007-07928 (Sup. Ct. Monroe Co. November 20, 2007)
Motion to enforce settlement agreement reached between the lawyers in e-mail communications denied. E-mails are not signed writing within CPLR 2104. In any event, the exchange of e-mails did not result in a binding agreement.

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Latour v. Valle

Index #2007-05166 (Sup. Ct. Monroe Co. November 20, 2007)
Breach of joint venture agreement to form a LLC justified return of plaintiff’s capital contribution subsequently converted by defendant for use in his existing construction business. Action at law may be maintained prior to accounting because there was nothing that might be the subject of an accounting and the joint venture or partnership had terminated. Offending partner personally liable.

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Webster v. Total Identity Corporation

Index #2005-00211 (Sup. Ct. Monroe Co. December 6, 2007)
Summary judgment granted dismissing fraudulent inducement claim. No issue of fact that statements were known to be false when made. Legal malpractice claim also dismissed; mere direction by client to attorney to deposit funds given to him by third party maker of check, "pending further instructions" from the client, does not create an escrow for the benefit of check maker or establish a condition precedent to release of the funds. Attorney never agreed to hold funds for the benefit of anyone but his client. Transaction documents did not call for or imply a fiduciary obligation in respect to funds turned over to attorney. Expert affidavit of lawyer rejected as clearly contrary to applicable law.

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Millner v. Rochester Lumber Company

Index #2007-06218 (Sup. Ct. Monroe Co. December 17, 2007)
Defense of setoff waived by failure to plead it as affirmative defense or counterclaim. No charging lien regarding statutory attorneys fees was created because petitioner only sought an order directing execution and delivery of a satisfaction of mortgage. Petitioner did not seek or obtain identifiable proceeds upon which the putative lien could affix. Setoff would otherwise be denied on equitable grounds by reason of proponent’s self-help measures amounting to unclean hands.

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Navint Consulting, LLC v. Fecteau

Index #2007-11877 (Sup. Ct. Monroe Co. December 18, 2007)
Complaint against departing employees taking job with competitor dismissed because plaintiff’s complaint failed to make a "sufficient start" by pleading some facts constituting a claim. Complaint must be supported with more than speculation.

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Skillsoft Corp. v. Element K Corp.,

Index #2007-13202 (Sup. Ct. Monroe Co. December 21, 2007)
Stay under CPLR 2201 denied. No complete identity of parties, causes of action and judgment sought and judicial economy did not otherwise warrant issuance of stay.

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Thompson v. McQueeny

Index #2007-07194 (Sup. Ct. Monroe Co. January 2, 2008)
Motion under CPLR 5519(a)(4) to designate an officer of the court to take custody of two patents ordered to be transferred to plaintiff pursuant to the parties’ letter agreement pending determination of appeal. Automatic stay pending appeal under CPLR 5519(a)(4) held invoked inasmuch as patents ordered to be transferred to plaintiff were personal property under applicable law, but circumstances warranted exercise of discretion limiting or modifying the automatic stay created by directing the posting of an undertaking. Hearing on patent valuation ordered. Discretion guided in part by fact that automatic stay destroyed plaintiff’s right to exploit the patents during pendency of appeal and the court’s assessment of the likelihood of success on appeal.

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Evolution Impressions, Inc. v. Lewandowski

Index #2005-06051 (Sup. Ct. Monroe Co. July 23, 2007)
Damages hearing after summary judgment granted upon default - facts deemed admitted on the motion are for a procedural determination of default and not for the purpose of determining the merits of the action; opposing party relegated to motion to vacate default but court nonetheless must on motion to vacate consider the sufficiency of the evidentiary showing made by the moving party on the defaulted summary judgment motion before determining whether the default judgment resulting therefrom is, ultimately, on the merits. Although plaintiff’s ability to prove lost profits hampered by faithless employees’ theft and subsequent litigation misconduct, resulting in a more relaxed standard of definiteness, plaintiff’s claim to lost gross profits denied where plaintiff’s testimony established that cost figures were relevant but not deducted, and no evidence of the same was produced by plaintiff. Nominal damages awarded despite relaxed damages rule.

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Rochester Diagnostic Imaging Associates, RLLP v. Stephenson

Index #2005-07452 (Sup. Ct. Monroe Co. July 25, 2007)
Summary judgment declaring rights under Partnership Agreement entered into after purchase of MRI equipment providing for split of income arising out of technical component of the service and the professional component (i.e., reading the MRIs). Provision in agreement stating partners are "afforded opportunities to earn professional service income proportionate to their members’ aggregate pro rata shares" does not compel a partner to provide such professional services, whether at any particular level or at all. Because no ambiguity involved, extrinsic evidence excluded, a declaration issued that the provision of professional services is not required by the partnership agreement. Summary judgment also granted declaring payment of administrative fee unauthorized under the Agreement and not permitted under Partnership Law §40(6). Steinberg v. Goodman, 27 N.Y.2d 304 (1970) distinguished.

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Fedder Industrial Park v. R.P. Fedder Corp.

Index #2005-03437 (Sup. Ct. Monroe Co. August 8, 2007)
Late charges under commercial lease agreement - existence of non-waiver clause does not by itself preclude a finding of waiver on facts showing acceptance of late rental payments without comment for entire duration of the tenancy period and where the lease provision for late payment fee precluded an interpretation that it contemplated payment as a cumulative lump sum payment after termination of the lease. Jefpaul Garage Corp. v. Presbyterian Hosp., 61 N.Y.2d 442 (1984) distinguished. Nevertheless, lease terms ambiguous on the point at which late payment fee would have been waived, if at all. Non-waiver may be determined on summary judgment, but waiver may not be so determined.

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Conifer Realty, LLC v. Catholic Health Systems, Inc.

Index #2005-02265 (Sup. Ct. Monroe Co. August 14, 2007)
Type II preliminary agreement is established by collection of writings between parties, including defendant’s letter to plaintiff designating plaintiff as its "choice to develop this project," which obligated the parties to negotiate open issues in good faith. Accordingly, defendant’s summary judgment motion on the ground that only an agreement to agree existed denied. Plaintiff’s summary judgment motion denied, however, because final agreement cannot be established where there is indefiniteness of price term, and further because issue of fact presented as to whether plaintiff substantially performed. Plaintiff only entitled to out-of-pocket loss occasioned by breach of duty to negotiate in good faith.

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Eldre Corp. v. SC Technologies, Inc.

Index #2007-10641 (Sup. Ct. Monroe Co. September 7, 2007)
Preliminary injunction denied: Non compete agreement preluded by Statute of Frauds and thus no likelihood of success on merits. No binding contract containing a non-compete found when material alterations of defendant’s counter-offer were made by plaintiff when he initialed some of defendant’s changes but not others, thereby becoming another counter-offer, which was not accepted by defendant. Plaintiff’s effort to cob together a contract by reference to other unsigned writings allegedly incorporated into the signed writings does not raise issue of fact because plaintiff relied almost entirely on unexecuted agreements prepared by plaintiff and they did not contain the essential terms. Claimed likelihood of success on claim that defendant had common law duty to assign invention to his former employer undermined by former employer’s admissions that defendant was not an employee at the relevant time.

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The IDE Group, PC v. Fredrick Ferris Thompson Hospital

Index #2007-05597 (September 10, 2007)
Preliminary injunction denied on the ground that it would have the effect of granting specific performance of an Exclusivity Agreement, and otherwise would grant the ultimate relief demanded in complaint rendering further litigation futile. Plaintiff’s contention that the "ultimate relief" doctrine is only applicable in the context of mandatory preliminary injunctions rejected.

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Amalfi v. Helmicki

Index #2007-05476 (Sup. Ct. Monroe Co. September 14, 2007)
Seller of salon business who thereafter left the area returned and contracted with the buyer of his business to work at the business site under an Independent Contract Agreement. The ICA conditioned former owner’s work at site, including serving his old customers, on certain preconditions, one of which was that if he decided to leave the site and open a competing business, he would have to pay the buyers 20% of his gross revenue fee earned at the new site. Against a claim by the former owner, who subsequently abandoned the ICA and set up a new competing business down the street, over 10 years after the original sale of the salon, that BDO Seidman governed the reasonableness of the 20% gross revenue provision of the ICA, on the theory that the former owner was then an employee of the business’ new owners, summary judgment was granted declaring that the 20% provision was only a modification of the terms of the original purchase and sale agreement that required application of the lessened reasonableness analysis applicable to the sale of business context. In other words, there was nothing unreasonable about that part of the ICA which served to retain the benefits of their purchase of good will once the former owner/independent contractor sought to free himself of the preconditions to serving clients at the business site contained in the ICA because, otherwise, the non-solicitation of good will covenant operates in perpetuity.

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Shrink Packaging Systems Corp. v. Seoil Industrial, U.S.A, Inc.

Index #2007-06606 (Sup. Ct. Monroe Co. September 20, 2007)
Dismissal based on documentary evidence because defendant Seoil USA was not a party to the agreements in question but rather Seoil Korea was, and for failure to state a cause of action because the complaint was based on obligations contained in indisputably expired agreements. Plaintiff’s effort to invoke an implied-in-fact or oral agreement on the part of Seoil USA to take over Seoil Korea’s obligations under these contracts was no pled and so the dismissal was without prejudice.

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1440 Empire Blvd. Dev. Corp. v. Lawyers Title Ins. Corp.

Index #2006-06967 (Sup. Ct. Monroe Co. September 25, 2007)
Survey exception in Title policy excluding "any state of facts an accurate survey would disclose" not demonstrated to be applicable by reference only to a survey of an adjoining parcel, not the subject parcel, which shows a competing property description in the adjoining parcel’s deeds. Plaintiff’s expert established that adjoining parcel’s deeds were in error and subject parcel’s deeds were accurate, thus entitling owner to summary judgment declaring the title company’s duty to defend.

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Ajay Glass & Mirror Co., Inc. v. AASHA G.C., Inc.

Index #2005-02962
Summary judgment dismissing breach of contract action denied inasmuch as issue of fact raised whether plaintiff entered into enforceable contract with defendant. Documentary evidence shows novation occurred when owner interposed a 3 party compensation agreement between plaintiff and owner via a shell corporation. While extrinsic evidence that the arrangement was a sham would ordinarily be permitted, here the parties actively employed aspects of the sham agreement and plaintiff took advantage of its payment terms. Thus the parole evidence does not preclude summary judgment because inadmissable.

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