Motion sequence numbers 002 and 003 are consolidated for disposition.

This is a breach of contract action brought by the plaintiff Conception Bay ("Conception") against the defendants Koenig Iron Works, Inc. ("Koenig"), Alan Guthertz, First National Insurance Company of America ("First National") (together with Koenig and Guthertz, the "Koenig defendants") and Plaza West Associates, LLC ("Plaza West"). Before me is Conception's motion [*2]seeking confirmation that it may assert its claim in quantum meruit and to dismiss the Koenig defendants' eleven affirmative defenses (except the sixth and seventh) and five counterclaims (sequence number 002). Also before me is the Koenig defendants' motion for summary judgment dismissing the amended complaint (sequence number 003).

This action arises from construction on a building owned by Plaza West (the "Project"). The building is located at 636 11th Avenue in Manhattan (the "Property"). In March 2008, EMS Construction Corp., Plaza West's agent and construction manager, contracted with Koenig, as general contractor, for Koenig to provide certain steel and metal work. Conception, as subcontractor to Koenig, thereafter provided certain structural work. The relationship between Conception and Koenig is the subject of this action.

Conception and Koenig dispute the existence of a contract between them. Conception contends that no contract was formed, and the Koenig defendants contend otherwise.

The undisputed facts are these: On January 30, 2008, Conception submitted a proposal it labels the "Original Bid," prepared in accordance with certain plans and specifications, to Koenig for work it was to perform on the Project, priced between $596,000 and $743,000, depending on the amount of insurance it needed to provide (the "January Proposal"). (Am Compl, ¶ 19). By letter dated February 26, 2008, Koenig confirmed its acceptance of Conception's bid for the subject work, in an amount of $670,000 (the "Base Price"). On April 14, 2008, Conception submitted a further proposal to Koenig, containing the same price range as the January Proposal. By letter dated April 16, 2008, Koenig confirmed its acceptance of Conception's bid, in an amount of $727,000.

Shortly thereafter, Conception commenced work on the Project and subsequently sent Koenig a contract change notice, dated April 29, 2008 and numbered No.1, which listed the "Original Bid Price" as $727,000. (Guthertz Aff, Exh 13). By letter dated April 27, 2008, after determining the amount of insurance Conception would need to provide, Koenig confirmed its acceptance of Conception's bid, in the earlier amount of $670,000. Thereafter, all but one of the contract change notices Conception sent to Koenig, dated between June 2, 2008 and July 14, 2008 and numbered #2-8 and 10-13, contained the "Original Bid Price" listed as $670,000. (Id., Exhs 16-21, 23-24).

Between June 9 and August 14, 2008, Conception Bay executed six partial waiver of liens in return for certain payments received from Koenig (the "Lien Waivers"). The Lien Waivers provided that payments received "were for completed work on Contract and Change orders " through a certain date. (Id., Exhs 25-30). The Lien Waivers further provide:

[Conception] does hereby waive and release any and all claim or right of lien on the above described premisesand the improvements thereon, under the statutes of the State in which the aforesaid building is located relating to mechanics liens, and on the money or other consideration due or to become due from the owner, and on account of labor or materials, or both, or which may be furnished to this date by the undersigned[.](Id.).

On September 30, 2008, Conception filed a notice of lien in the amount of $484,451.77 (the "Lien"), based on sums it claims are due and owing from the defendants.

Conception contends that no contract was formed between itself and Koenig. It claims that it rejected and refused to sign any of Koenig's letters confirming its bids. Conception further contends that its work on the Project was done on a time and material basis. (See Travers Aff, ¶ 23). It bases this contention on an e-mail, dated May 29, 2008, from Koenig's president, Richard Velting. [*3]The e-mail describes several items discussed during a recent meeting between Koenig and Plaza West, including, inter alia, the rates and the method of payment to Conception for overtime pay. (See Guthertz Aff, Exh 32).

The Koenig defendants contend that the documents in the record are clear and demonstrate that a contract was formed between itself and Conception. They maintain that, while Conception did not sign and return any of Koenig's letters confirming Conception's bids, for the purposes of contract formation, this was unnecessary given Conception's subsequent commencement of work on the Project and its multiple acknowledgments of the Base Price in the contract change notices. They assert that Conception mischaracterizes the e-mail from Velting, which "simply reflects applicable rates for additional work & overtime' that have been approved." (Guthertz Aff, ¶ 22). The Koenig defendants contend that the Lien must be vacated because it was not properly verified.

In the amended complaint, Conception asserts causes of action for an accounting, attorneys' fees, compensation based in quantum meruit or contract and foreclosure of a lien, alleging that the defendants owe a substantial sum of money.

In the answer, the Koenig defendants assert eleven affirmative defenses and five counterclaims, alleging that Conception owes money because it has been over paid.

Turning to Conception's motion, I will first address its request for confirmation that it may prosecute its claim in quantum meruit.

"To state a claim in quantum meruit, a plaintiff must allege its good faith performance of services, the defendant's acceptance of those services, an expectation of compensation for the services, and the reasonable value of those services." (Skill Games, LLC v Brody, 1 AD3d 247, 251 [1st Dep't 2003]). "In addition, a claim for quantum meruit generally will not lie where a contract between the parties governs the dispute." (Id.). Thus, first it must be determined whether a contract exists between the parties.

"The requirements for formation of an enforceable contract are: (1) at least two parties with legal capacity to contract; (2) mutual assent to the terms of an agreement with reasonably certain' terms; and (3) consideration."(4 NY Prac., Com. Litig. in New York State Courts § 59:12 [2d ed.], quoting Cobble Hill Nursing Home, Inc. v Henry and Warren Corp., 74 NY2d 475, 482 [1989]). "Mutual assent, or meeting of the minds,' is manifested by an offer followed by an acceptance of an arrangement having definite essential terms." (Id. § 59:14 [2d ed.], quoting Gui's Lumber & Home Center, Inc. v Mader Const. Co., Inc., 13 AD3d 1096, 1096 [4th Dep't 2004] lv dismissed 5 NY3d 842 [2005]). "The acceptance, or manifestation of assent, must also be clear, unambiguous and unequivocal[.] Assent may be implied when a party has conducted himself in such a manner that his assent may fairly be inferred.'" (Id., quoting Grombach Prods. v Waring, 293 NY 609, 615 [1944]).

Here, the Koenig defendants have established the existence of a contract. Indeed, I find that Koenig's letter, dated February 26, 2008, and the related correspondence between itself and Conception discussed above, constitutes an offer containing the essential terms, including the scope of work to be completed and a contract price of $670,000. I further find that Conception's conduct exhibited in its subsequent commencement of work on the Project and its repeated confirmation of Koenig's offer and the Base Price in its contract change notices constitutes its clear, unambiguous and unequivocal acceptance. The statement contained in the Lien Waivers executed by Conception [*4]that the payments received from Koenig "were for completed work on Contract" provides further support for this finding.^[FN1] It is undisputed that the parties possessed capacity to enter into an agreement or that the agreement was supported by adequate consideration.

Therefore, having determined the existence of an unambiguous and binding agreement between the parties, I find that Conception may not proceed with its claim in quantum meruit.

By its motion, Conception further seeks to dismiss the Koenig defendants' affirmative defenses (except the sixth and seventh) on the grounds that they are conclusory and unsupported by facts, are contradicted by documentary evidence or fail to state a claim. The Koenig defendants' answer responds line by line to the allegations in the amended complaint. They plead primarily one-sentence affirmative defenses, including failure to state a cause of action and improper filing of a lien. This is sufficient to provide Conception with notice of the defenses. (See CPLR 3026; Siegel, NY Prac § 223 [4th Ed.]; see also CPLR 3013 & 3018). "Moreover, pleadings should be liberally construed and defects ignored unless a substantial right is prejudiced, [and] . . . the defendant is entitled to every reasonable intendment of its pleading." (Youssef v Triborough Bridge and Tunnel Auth., 24 AD3d 661, 661 [2d Dep't 2005]). Indeed, Conception fails to claim that a substantial right has been prejudiced by the allegedly insufficient pleadings. Therefore, Koenig defendants' affirmative defenses are sufficiently plead and Conception's motion to dismiss the same is denied.

Conception's motion further seeks to dismiss the Koenig defendants five counterclaims on the grounds that they either fail to state a claim or are contradicted by documentary evidence.

On a motion to dismiss made pursuant to CPLR 3211, the complaint "is to be afforded a liberal construction," and the claimant is afforded the "benefit of every possible favorable inference." (Leon v Martinez, 84 NY2d 83, 87 [1994]). When a motion is based on documentary evidence, pursuant to CPLR 3211(a)(1), dismissal of a cause of action is warranted "only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law." (Id. at 88). Under CPLR 3211(a)(7), "the criterion is whether the proponent of the pleading has a cause of action, not whether he has stated one." (Id. at 88, citing Guggenheimer v Ginzburg, 43 NY2d 268, 275 [1977]).

The Koenig defendants' first counterclaim is for breach of contract against Conception. In a cause of action for breach of contract, the following elements must be pled: the existence of a binding contract; plaintiff's performance of the contract; defendant's material breach of the contract; and damages. (Furia v Furia, 116 AD2d 694, 695 [2d Dep't 1986]). In their answer, the Koenig defendants allege the correspondence between Koenig and Conception, as discussed above, and [*5]Conception's subsequent commencement of work on the Project as the factors constituting the existence of a binding agreement. (Answer, ¶ 54). They further allege that Conception breached that agreement by ceasing work on the Project prior to completion, despite being advanced monies for that work. They also allege that, as a result of Conception's breach, they were "compelled to hire other subcontractors to complete the work abandoned by Conception." (Id., ¶ 62). This is sufficient.

Conception argues that this counterclaim should be dismissed based on its submission of a spreadsheet it entitles "Table of Labor Costs." (Habiague Aff, Exh 7). It argues that Conception's "Table of Labor Costs (Exhibit 7) prove [sic] this assertion is false," referring to Koenig's assertion in the counterclaim that Conception had requested advances. (Id. ¶ 46). However, this submission is insufficient to conclusively establish a defense as a matter of law because Conception fails to provide the required foundation for admissibility of this alleged business record. (See CPLR 4518 & 3211[c]). Thus, the first counterclaim survives.

The Koenig defendants' second counterclaim is for damages for willful exaggeration of lien against Conception and Travers. As discussed below, I find that the Lien must be vacated based on Conception's failure to properly verify the Lien. Thus, this counterclaim is dismissed as moot. (See Wellbilt Equip. Corp. v Fireman, __ AD2d __, __, 2000 NY Slip Op 08556, *215-216 [1st Dep't 2000] ["In interpreting the Lien Law, our courts have held that damages under section 39-a may not be awarded unless the lien has been declared void for wilful exaggeration after a trial in an action to foreclosure the lien. . . . Where the lien has been discharged for reasons unrelated to its supposed exaggeration, there remains no lien to be declared void by the court."]).

The third counterclaim is for abuse of process against Conception and Travers, based their filing and seeking to enforce an allegedly exaggerated and false lien. "Abuse of process has three essential elements: (1) regularly issued process, either civil or criminal (2) an intent to harm without excuse or justification and (3) use of process in a perverted manner to obtain a collateral objective." (Panish v Steinberg, 32 AD3d 383, 383 [2d Dep't 2006]). These "essential elements should be pleaded, though it is sufficient if the pleadings show facts from which they can be fairly inferred." (86 NY Jur 2d, Process and Papers § 164, citing Foy v Barry, 87 AD 291, 294 [1st Dep't 1903]).

In their answer, the Koenig defendants allege damages as a result of Conception and Travers' intentionally filing an exaggerated and false lien for the purpose of compelling payment from Koenig. It further alleges that Conception was aware of the significant difficulties such a filing would impose on Koenig. This is sufficient.

Conception again argues that its Table of Labor Costs proves that the Koenig defendants' claim is "factually wrong" and warrants dismissal of this counterclaim. (Habiague Aff, ¶ 50). However, as discussed above, I find this argument unavailing. Moreover, in light of Conception's execution of the Lien Waivers, which acknowledge payments by Koenig and wherein Conception specifically waives its rights with respect to liens, I conclude that dismissal of this counterclaim is not warranted.

The fourth and fifth counterclaims allege violations of Sections 274 and 275 of Debtor and Creditor Law ("DC Law") against Conception and Travers.

Section 274 provides:

Every conveyance made without fair consideration when the person making it is engaged or is about to engage in a business or transaction for which the property remaining in his hands after the conveyance is an unreasonably small capital, is fraudulent as to creditors and as to other persons who become creditors during the continuance of such business or transaction without regard to his actual intent.

Section 275 provides:

Every conveyance made and every obligation incurred without fair consideration when the person making the conveyance or entering into the obligation intends or believes that he will incur debts beyond his ability to pay as they mature, is fraudulent as to both present and future creditors.The claimant pleading violations of the above sections of DC Law is not required to plead with the "heightened particularity pursuant to CPLR 3016(b)." (Gateway I Group, Inc. v Park Ave. Physicians, P.C., 62 AD3d 141, 149 [2d Dep't 2009]).

The Koenig defendants allege that Conception and Travers made fraudulent conveyances in violation of the above sections of DC Law. They specifically allege that, despite receiving payments from Koenig, as reflected in the Lien Waivers, Conception was unable to make benefit payments to its union, Local 40, to the point where the union "threatened to walk off the job if such payments were not received." (Guthertz Aff, ¶ 24). They further allege that, as a result, Koenig was compelled to make the benefit payments. (Answer, ¶¶ 72-75).

Conception argues that these counterclaims must be dismissed because they are based on conclusory allegations unsupported by facts. However, I find that the allegations set forth in the fourth and fifth counterclaims are sufficiently pled. Thus, these counterclaims also survive.

I turn now to the Koenig defendants' motion.

By its motion the Koenig defendants argue that they have established a prima facie entitlement to summary judgment as a matter of law by demonstrating that the plaintiffs have no cause of action against them.

When a party moves for summary judgment, it "must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any material issues of fact from the case." (Finkelstein v Cornell Univ. Med. Coll., 269 AD2d 114, 117 [1st Dep't 2000] quoting Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]). When the movant on a summary judgment motion demonstrates its entitlement on that motion, the burden then shifts to the opposing party to demonstrate, by admissible evidence, that a material issue of fact remains. (See CPLR 3212[b]; Zuckerman v City of New York, 49 NY2d 557, 562 [1980]).

Conception's first, second and fourth causes of action are based on the Lien, filed on September 30, 2008. Therefore, it must be determined whether the Lien is valid and enforceable.

Lien Law § 9(7) provides that a notice of lien must be verified "by the lienor or his agent, to the effect that the statements therein contained are true to his knowledge except as to the matters therein stated to be alleged on information and belief, and that as to those matters he believes it to be true." Here, the Lien must be vacated because Conception has acknowledged that the person verifying the Lien, Fern Franke, lacked personal knowledge of the facts and circumstances underlying the Lien. (See Rosenstock Aff, Exh 36 ["She has no direct knowledge of the transactions [*6]in this dispute."]).

Thus, having established that the Lien must be vacated, the Koenig defendants have also established their prima facie entitlement to summary dismissal of Conception's first, second and fourth causes of action, and Conception has failed to demonstrate that a material issue of fact remains.

Conception's third cause of action is premised on its assertion that it is entitled to relief in quantum meruit based on its argument that no contract was formed. However, having established that a valid contract exists between the parties, as discussed above, the Koenig defendants have established their entitlement to summary dismissal of Conception's third cause of action, and Conception has failed to show the existence of a material issue of fact.

In light of the foregoing, the amended complaint must be dismissed in its entirety, and the remainder of the action shall continue.

Accordingly, it is

ORDERED that Conception's motion to dismiss (Seq. No. 002) is granted to the extent that the Koenig defendants' second counterclaim is dismissed; and it is further

ORDERED that the Koenig defendants' motion for summary judgment (Seq. No. 003) is granted and the amended complaint is dismissed; and it is further

ORDERED that the remainder of the action shall continue; and it is further

ORDERED that the Clerk is directed to enter judgment accordingly.

DATED: May 28, 2010

ENTER:

J.S.C.