The following papers numbered 1 to 14 read herein:

Papers Numbered

Notice of Motion/Order to Show Cause/

Petition/Cross Motion and

Affidavits (Affirmations) Annexed1-38-10

Opposing Affidavits (Affirmations)411-12 [*2]

Reply Affidavits (Affirmations)

Affidavit (Affirmation)

Memoranda of Law5-713-14

In this action by plaintiff Ameritel Mobile LLC (Ameritel) against defendants Wireless Connection (Wireless) and Thomas Tsang (Tsang) (collectively, defendants) for breach of three written management agreements and three guarantees, Ameritel moves for summary judgment directing that a judgment be entered in its favor on its claim for breach of contract and dismissing all counterclaims asserted by defendants. Defendants move for an order, pursuant to CPLR 3212, awarding them summary judgment in their favor and dismissing Ameritel's causes of action in their entireties.

Ameritel is a California limited liability corporation that is a wholly owned subsidiary of American Telecommunications, Inc. (ATI), a New York corporation with a principal place of business in Brooklyn, New York. ATI is a wireless telecommunications company with a nationwide network of retail dealers marketing wireless products and services exclusively for T-Mobile USA, Inc. (T-Mobile). Tsang is an individual, who resides in Vacaville, California, and the owner of Wireless, which is a sole proprietor or "doing business as" name registered in Solano County, California.

Beginning in May 2003, Tsang, who was experienced in the wireless telephone industry, opened a T-Mobile wireless store in Vacaville, California (the Vacaville Store) and, in June 2005, he opened a second T-Mobile wireless store in Dixon, California (the Dixon Store). In 2006, Ameritel succeeded Northstar Wireless Group (Northstar) as T-Mobile's master agent in Tsang's territory. In April 2007, Tsang was asked by Michael Morofsky (Morofsky), the North California regional manager for Ameritel, if he was interested in taking over the management and operations of three existing T-Mobile stores in shopping malls. One of these stores was located in the Sunvalley Mall in Concord, California (the Sunvalley Store), and the other two stores were located in the Serramonte Center in Daly City, California (the Serramonte #1 Store and the Serramonte #2 Store) (collectively, the Mall Stores).

In May of 2007, Ameritel presented Tsang with three Management Agreements (the Management Agreements) to sign in order to operate the three locations. Each of the Management Agreements set forth that Ameritel had dealership agreements with T-Mobile for the sale of personal, wireless, cellular and mobile telecommunications equipment and accessories and services (cellular services), and stated that Ameritel has, or in the near future, would be entering into leases for each of the corresponding locations [*3]for the Mall Stores, which would be used for the sale of cellular services (the leases) and that Ameritel desired to retain Wireless, as the manager, as an independent contractor, to manage the operations of the locations for the Mall Stores for the sale of T-Mobile cellular telephone equipment, accessories, and services at these locations, in accordance with the terms set forth therein.

Paragraph 1 of each of the Management Agreements provided that Ameritel would, as soon as practicable, enter into a lease or use its best efforts to enter into a lease for each of the locations for the Mall Stores, thereby agreeing to procure the leases for the Mall Stores, if it had not previously done so. As of February 27, 2007, Ameritel had already entered into agreements for the assignment to it of the leases for the Serramonte #1 Store and the Serramonte #2 Store, and on or about March 7, 2007, Ameritel had entered into a lease agreement for the Sunvalley Store. Thus, in May 2007, Ameritel had already satisfied its obligations under the Management Agreements to procure the leases.

On May 5, 2007, Tsang signed the Management Agreements on behalf of Wireless, and Morofsky signed them on behalf of Ameritel. Tsang, on behalf of Wireless, was subsequently asked by Ameritel to re-execute the identical Management Agreements,^[FN1] and he and Ameritel both re-executed them on June 2, 2007. Tsang has admitted that he did not read or review the Management Agreements prior to signing or re-signing them. He claims that he was told that if he did not sign the Management Agreements, Ameritel would give the Mall Stores to somebody else.

On May 5, 2007 and again on June 2, 2007, Tsang also executed written personal guarantees to Ameritel with respect to each of the Mall Stores (the Guarantees), pursuant to which he unconditionally guaranteed to Ameritel "the complete and timely performance by [Wireless] of all of its obligations under the Management Agreement[s], and the full and prompt payment of all monies due to [Ameritel] under the Management Agreement[s] or under any other obligation relating to the operation of the [Mall S]tore[s], for which [Wireless] [wa]s obligated under the terms of the Management Agreement[s]." Pursuant to the Guarantees, Tsang agreed "to be bound by each and every provision, term or condition set forth in the Management Agreement[s] . . . to the same extent as if [Tsang] had executed the Management Agreement[s] as Manager." The Guarantees also set forth that Tsang's "obligations . . . [we]re absolute and unconditional . . . without any right of offset or deduction by reason of any counterclaim or offset which [Wireless] or [Tsang] may have against [Ameritel]."

Paragraph 5 of the Management Agreements, entitled "Cost and Expenses," expressly stated that Wireless "shall be solely responsible for all costs and expenses incurred in connection with the operation of the Location, including . . . purchase of inventory . . . security deposits . . . rent [and] additional rent." Paragraph 7 of the [*4]Management Agreements, entitled "Compensation," provided that for as long as Wireless operated the Mall Stores in accordance with the Management Agreements, it would be entitled to retain all retail and commission income received by it from the operation of the Mall Stores, in addition to any commissions due manager upon payments received by Ameritel from a "Provider" such as T-Mobil.. This paragraph further provided that at such time as Wireless ceased to operate the Mall Stores, for any reason, Wireless would no longer be entitled to any payments from Ameritel. Paragraph 8 of the Management Agreements set forth representations and warranties of Wireless; paragraph 9 of the Management Agreements contained an agreement by Wireless to indemnify Ameritel with respect to Ameritel's obligations under the lease and the Provider Agreement; and paragraph 10 of the Management Agreements stated that these agreements were personal, and could not be "assigned, transferred, delegated, sold, or shared."

Paragraphs 11 and 13 of the Management Agreements provided that Ameritel could terminate the Management Agreements and declare Wireless in default upon the occurrence of certain events, including if it failed to, or otherwise ceased, operating any of the Mall Stores without its consent or if it was in default in the performance of the terms of the leases. Paragraph 14 of the Management Agreements provided that upon termination of Wireless' right to operate the Mall Stores, Wireless' right to receive compensation for operation of the Mall Stores would terminate.

Paragraph 15 of each of the Management Agreements, entitled "Damages," contained a liquidated damages clause, which provided that if the Management Agreements terminated as a result of Wireless' default on its obligations thereunder, Wireless was required to "immediately pay to Ameritel as damages an amount . . . equal to all rent, additional rent, and other charges which may become due under the Lease for the Location during the . . . twelve (12) months following the date of termination." This liquidated damages clause further provided that Wireless "acknowledge[d] that such costs [we]re fair compensation to Ameritel for its costs in obtaining a new Manager, training said Manager and assuming the obligations for operating the Location." Paragraph 17 of the Management Agreements, entitled "Ameritel Right to Offset," set forth that if Wireless failed to make payments as required while operating the Mall Stores, Ameritel had the right to offset these amounts against commissions or activation fees earned by Wireless at any location it operated. It specifically provided that in such event, Wireless agreed that Ameritel shall be authorized and permitted to withhold any amounts otherwise due to Wireless under the Management Agreements or any other agreement, and apply same to the amounts due from Wireless under the Management Agreements.

Paragraph 21 of the Management Agreements, entitled "Governing Law," stated that the Management Agreements "shall be governed by, and construed and enforced in all respects in accordance with, the laws of the State of New York, without giving effect to the principles of conflicts of law." It further stated that the parties "consent[ed] that any legal or equity proceeding brought in connection with, or arising out of, any matter [*5]relating to [the Management Agreements], and the transaction[s] to which [they] relate[d], shall be instituted only in a federal or state Court of competent jurisdiction within the State of New York County of Kings," and that Wireless "irrevocably consent[ed] to, and submit[ted] to the jurisdiction of, the Courts of the State of New York, County of Kings, and waive[d] any objection it . . . may have to either the jurisdiction or venue of such Courts." The Guarantees similarly provided that they "shall be construed and enforced in all respects in accordance with the laws of the State of New York," that the parties consented that any legal or equity proceeding brought in connection with or arising out of any matter relating to the Guarantees would be instituted only in a court in the State of New York, Kings County, and that Tsang irrevocably consented and submitted to the jurisdiction of the court of the State of New York, Kings County, and waived any objection to either the jurisdiction or venue of this court.

Paragraph 24 (a) of the Management Agreements contained an integration clause, which set forth that the Management Agreement and the Guarantees executed concurrently therewith "constitute[d] the entire understanding and contract between the parties . . . [and] supersede[d] any and all prior agreements or understandings." It further set forth that "[n]o representations, inducements, promises, agreements, arrangements or undertakings between the parties not embodied [t]herein shall have any force and effect."

Prior to the execution of the Management Agreements and the Guarantees, Tsang requested copies of the leases for the Mall Stores that were referred to in the Management Agreements, but Ameritel did not provide him with copies of the leases prior to such execution. Tsang claims that after signing the Management Agreements, he continued to repeatedly request copies of the leases so that he could review the terms by which he and Wireless would be bound, and that, without the leases, he had no way of knowing what the cost and expense obligations and default conditions were under the Management Agreements or how much he would be obligated to pay each month in rent. He claims that despite these repeated requests, the leases were still not provided to him. However, Tsang admits that prior to signing the Management Agreements in May 2007, he was fully informed of the rents due at each of the locations of the Mall Stores. Specifically, Tsang concedes that he was told before signing the Management Agreements what the rent would be at each of the locations of the Mall Stores, and that he was given the correct amounts of rent (Tsang's Dep. Transcript at 74-76).

Tsang further claims that prior to signing the Management Agreements, he inquired as to the financial condition of the Mall Stores and was told by Ameritel around March or April 2007, that they were profitable and that each store was making about $5,000 or more a month in net profit. Tsang asserts that he asked Morofsky three to four times for written profit and loss statements for the Mall Stores before he executed the Management Agreements (Tsang's Dep. Transcript at 80). According to Tsang, he requested these written profit and loss statements for the Mall Stores on a daily basis, but was not provided with them prior to executing the Management Agreements, and was [*6]never provided with the requested profit and loss statement for either the Serramonte #1 Store or the Serramonte #2 Store. Tsang asserts that he signed the Management Agreements with the explicit understanding, based upon oral promises, that the profit and loss information would be forthcoming, demonstrating that each location was making about $5,000 or more a month in net profit.

Tsang also claims that he was assured by Ameritel that the Mall Stores would be able to keep all of the left over inventory, including phones, accessories, computers, printers, and Ameritel's point of sale software system, without charge to Wireless for it. According to Tsang, on May 21, 2007, after signing the Management Agreements, he was informed by Morofsky that he would now have to pay for any of the left over inventory in the Mall Stores if he wanted to keep it, even though he had been previously told otherwise. Tsang claims that since he did not have time to order new phones and the Mall Stores were about to open, he opened them with the existing inventory, and the cost for this inventory was charged to a credit line that Ameritel had established for him. Tsang further claims that he attempted multiple times to call to question this charge, but no one ever answered the phone and that his inquiries by e-mails met with no response from Ameritel. Tsang asserts that because he found that much of the inventory was outdated, used, returned, or defective, he elected to order new phones to conduct business and charged this on the credit line that Ameritel had established for him.

On June 1, 2007, Wireless assumed management responsibilities at the Mall Stores pursuant to the Management Agreements. Tsang claims that in July 2007, after execution of the Management Agreements and after he was operating the Mall Stores for a month, he was first provided by Morofsky with a profit and loss statement for the months of January 2007 through April 2007, but only for the Sunvalley Store, which had been sent by Andrei McGann (McGann), the West Coast representative of Ameritel, via an e-mail on July 5, 2007. According to Tsang, the numbers on this profit and loss statement coincided with what he had been verbally told by McGann before he signed the Management Agreements, namely, that the Sunvalley Store was operating at a profit of $5,000 per month. Tsang asserts that he relied upon these numbers and decided to continue operating the Mall Stores. Tsang claims that, in contrast to the numbers he received, Ameritel's chief financial officer, Michael Ziegler (Ziegler) had produced a profit and loss statement for the Sunvalley Store for the months of January 2007 through April 2007 via an e-mail to McGann on July 3, 2007, which showed a lower profit for the Sunvalley Store for the same time period.

Tsang claims that after three months of operating the Mall Stores, he discovered that Ameritel had made misrepresentations about the financial stability of the Mall Stores and that he was denied his residual and commission checks to which he believed he was entitled. He asserts that he created his own profit and loss statement for the months of June, July, and August 2007, which showed that the Sunvalley Store operated at a significant loss. Tsang states that he believes that Ameritel lied to him about the [*7]profitability of the Mall Stores in order to induce him to sign the Management Agreements with the purpose of having him develop a customer base at each location, and then, since he would be unable to operate long term, it could take back the Mall Stores with the developed customer base at no cost.

According to Tsang, he came to realize over time that Ameritel never intended to pay him for the commissions and residual income from the Mall Stores, as Ameritel deducted amounts owed under his credit line from his commissions. Despite paragraph 17 of the Management Agreements, which provided a right of offset to Ameritel, Tsang claims that Ameritel never told him that it would offset his credit line against his commission. In August 2007, Ameritel began exercising its right under paragraph 17 of the Management Agreements by offsetting amounts owed by the Mall Stores against commissions from the Vacaville and the Dixon Stores. In October 2007, Tsang informed Ameritel that he would no longer be able to manage the Mall Stores because Ameritel was offsetting the outstanding balance on his credit line against commissions and residual payments. Tsang continued to operate the Mall Stores until in or about February 2008.

By letter dated June 2, 2008, Wireless, as the manager under the Management Agreements, and Tsang, as the guarantor, were notified that they were in breach of the Management Agreements as of February 29, 2008, based upon the failure to manage and pay rent on behalf of Ameritel at the Serramonte #1and Serramonte #2 Stores. This letter stated that pursuant to paragraph 15 of the Management Agreements, Wireless was obligated to pay damages equal to all rent due under the leases for these locations during the next 12 months, and that the annual combined rents for the Serramonte #1 and Serramonte #2 Stores was $153,627.24. This letter further provided that pursuant to paragraph 17 of the Management Agreements, Ameritel had the right to offset any amounts owed by Wireless against commissions due to Wireless, and that it, therefore, was applying the outstanding commissions due to Wireless towards the rents for March, April, and May 2008, leaving an outstanding balance due to Ameritel of $116,844.92 in rent due. Defendants failed to pay this $116,844.92 balance.

On December 20, 2010, Tsang filed an action against T-Mobile, Ameritel, ATI, Nathan Yanovitch (a corporate officer of ATI), Ziegler, and McGann in the Superior Court of the State of California (the California action), alleging causes of action for breach of the implied covenant of good faith and fair dealing, breach of contract, intentional misrepresentation, negligence in relation to the Mall Stores, intentional and negligent infliction of emotional distress, intentional and negligent misrepresentation, concealment, false promise, reliance, conversion, and conspiracy, seeking damages in excess of $400,000. The California action, however, was stayed by the California Superior Court, pending the commencement and outcome of litigation to be commenced in New York due to the choice of law and venue provision set forth in paragraph 21 of each of the Management Agreements.

On March 3, 2011, Ameritel filed this action against defendants, alleging a first [*8]cause of action against Wireless for breach of the Management Agreements and a second cause of action against Tsang for breach of the Guarantees. In its complaint, Ameritel alleges that Wireless has materially breached its obligations under the Management Agreements by failing to pay amounts due to it, including an accounts receivables balance of $96,397, and rental obligations in excess of $193,000 (together, an amount in excess of $289,000).

On July 26, 2011, defendants filed a pre-answer motion to dismiss, alleging that the Management Agreements were not binding contracts, but merely agreements to agree. On October 5, 2011, the court, following oral argument, denied defendants' motion to dismiss. On November 6, 2011, defendants filed their answer, which contains denials, defenses, and 10 counterclaims, including a first counterclaim for fraud, a second counterclaim for negligent misrepresentation, a third counterclaim for fraudulent concealment, a fourth counterclaim for rescission, a fifth counterclaim for breach of contract, a sixth counterclaim for breach of the implied covenant of good faith and fair dealing based upon the alleged failure to pay residuals owed and full commissions, a seventh counterclaim for breach of the implied covenant of good faith and fair dealing based upon the alleged failure to give accurate profit and loss statements for the Mall Stores, an eighth counterclaim for conversion, and a tenth ^[FN2] counterclaim for intentional infliction of emotional distress. These counterclaims essentially assert the same claims as raised by Tsang in the California action. On December 22, 2011, Ameritel filed a reply to the counterclaims. Depositions have been held and all discovery has been completed. On February 1, 2013, Ameritel filed its note of issue. On March 28, 2013, the parties filed their respective motions for summary judgment.

In opposition to Ameritel's motion and in support of their motion, defendants contend that the Management Agreements were not binding contracts, but mere unenforceable agreements to agree. They rely upon paragraph 1 of each of the Management Agreements, which provided that Ameritel shall, as soon as practicable, [*9]enter into a lease . . . or use its best efforts to enter into a Lease for the Location," arguing that this language indicates that the Management Agreements were mere agreements to agree because the leases contained all of the material terms necessary to the transaction between the parties. They maintain that without the leases, the majority of the paragraphs of the Management Agreements are rendered meaningless. They point to references in the Management Agreements to the leases, noting that paragraph 5 stated that Wireless shall be responsible for all of the obligations under the leases, that paragraph 8 stated that Wireless represents that it shall comply with the leases, that paragraph 11 provided that Ameritel may terminate the Management Agreements if Wireless is in default in the performance of the terms of the leases, and that paragraph 15 calculated damages based upon the rent due under the leases. They claim that since copies of the leases were not provided to them prior to signing the Management Agreements, the Management Agreements are lacking in essential terms, are vague, indefinite, and unenforceable. They contend that, therefore, Ameritel's motion for summary judgment should be denied, and that Wireless should be granted summary judgment dismissing Ameritel's first cause of action for breach of contract.

Defendants, by their motion, also seek dismissal of Ameritel's second cause of action against Tsang for breach of the Guarantees. They assert that since the Guarantees all refer to the Management Agreements, which they contend are unenforceable, as the basis by which to hold Tsang liable, this cause of action must be dismissed. Defendants further argue that, based upon their contention that the Management Agreements are unenforceable and were fraudulently induced, they should be granted summary judgment on their second counterclaim for rescission.

In addressing Ameritel's motion and defendants' motion, the court notes that the question of the enforceability of the Management Agreements, i.e., whether the Management Agreements constituted binding enforceable contractual agreements rather than mere agreements to agree, constitutes an issue of law to be resolved by the court (see W.W.W. Assoc. v Giancontieri, 77 NY2d 157, 162 [1990]; Mallad Constr. Corp. v County Fed. Sav. & Loan Assn., 32 NY2d 285, 291 [1973]; Mills v Chauvin, 103 AD3d 1041, 1047 [3d Dept 2013]).

It is well established that in order to give rise to a binding and enforceable contract, there be "an objective meeting of the minds," and "a manifestation of mutual assent sufficiently definite to assure that the parties are truly in agreement with respect to all material terms" (Matter of Express Indus. & Term. Corp. v New York State Dept. of Transp., 93 NY2d 584, 589 [1999], rearg denied 93 NY2d 1042 [1999]; see also Mills, 103 AD3d at 1047; Robison v Sweeney, 301 AD2d 815, 817 [3d Dept 2003]). "[A] mere agreement to agree, in which a material term is left for future negotiations, is unenforceable" (Joseph Martin, Jr., Delicatessen v Schumacher, 52 NY2d 105, 109 [1981]; see also 2004 McDonald Ave. Realty, LLC v 2004 McDonald Ave. Corp., 50 AD3d 1021, 1022 [2d Dept 2003]; Andor Group v Benninghoff, 219 AD2d 573, 573 [2d [*10]Dept 1995], lv denied 87 NY2d 812 [1996]). However, "not all terms of a contract need be fixed with absolute certainty" (Matter of Express Indus., 93 NY2d at 590). "[A] contract is not necessarily lacking in all effect merely because it expresses the idea that something is left to future agreement" (May Metro. Corp. v May Oil Burner Corp., 290 NY 260, 264 [1943]). "[A]t some point virtually every agreement can be said to have a degree of indefiniteness," but "parties . . . should be held to their promises" to avoid defeating the reasonable expectations of the parties (Cobble Hill Nursing Home v Henry & Warren Corp., 74 NY2d 475, 483 [1989], rearg denied 75 NY2d 863 [1990], cert denied 498 US 816 [1990]).

In deciding whether a contract is binding and enforceable, of "prime significance" is the intentions of the parties and whether they intended to be bound by the contractual terms (FCOF UB Securities LLC v MorEquity, Inc., 663 F Supp 2d 224, 227-228 [SD NY 2009]). "[T]he existence of a binding contract is not dependent on the subjective intent of [the parties]" (Brown Bros. Elec. Contrs. v Beam Constr. Corp., 41 NY2d 397, 399 [1977]). Rather, in determining whether the parties entered into a contractual agreement, the court must, instead, look "to the objective manifestations of the intent of the parties as gathered by their expressed words and deeds" (id.). The relevant factors in determining whether an agreement is binding is the language of the agreement, the existence of open material terms, whether there has been partial performance, and the necessity of putting the agreement in a more final form (see FCOF UB Sec. LLC, 663 F Supp 2d at 228-229; Teachers Ins. and Annuity Assn. of Am. v Tribune Co., 670 F Supp 491, 497-499 [SD NY 1987]).

Here, there is explicit language in the Management Agreements, setting forth the mutual duties owed. There are no conditions precedent set forth in the Management Agreements as to the enforceability of these terms. The language of the Management Agreements give every indication that the parties intended them to be binding (see Tractebel Energy Marketing, Inc. v AEP Power Marketing, Inc., 487 F3d 89, 95 [2d Cir 2007]). Indeed, throughout the Management Agreements the terms "agreed" or "agree" are used, specifically providing (in paragraphs 1, 4, and 9) that Wireless agreed to manage the locations on behalf of Ameritel, agreed to operate the locations as an agent for Ameritel, and agreed to indemnify Ameritel. There is no reservation of rights in the Management Agreements to further formalize these agreements or to indicate that the parties contemplated any further writing to put their agreements in a more final form.

Notably, Tsang, who already had a similar contractual arrangement for the operation of two other store for plaintiff, executed the Management Agreements, as well as the Guarantees, twice, both times in the presence of a notary public, demonstrating his understanding of the legal significance of his signature. Furthermore, the Management Agreements stated, in paragraph 10, that they could not be assigned, indicating that only the specific named parties would be bound by it, thereby indicating their binding nature. [*11]

Although the Management Agreements required Ameritel to procure the leases, it had already done so at the time of the execution of the Management Agreements, thereby fulfilling this obligation. Thus, the rent was already established at the time of the execution of the Management Agreements. While Tsang, in an affidavit submitted in opposition to Ameritel's motion for summary judgment, now asserts that because he had not received the actual leases, he had no way of knowing how much he would be obligated to pay each month in rent, Tsang previously testified, at his deposition, that he actually knew the amount of rent due for each of the Mall Stores (Tsang's Dep. Transcript at 74-76). Tsang's attempt to create a feigned issue of fact by making statements in an affidavit which contradict his prior sworn deposition testimony must fail (see Zylinski v Garito Contr., 268 AD2d 427, 428 [2d Dept 2000]).

Tsang further asserts that without the leases he had no way of knowing what the cost and expense obligations and default conditions were under the Management Agreements. However, paragraph 5 of the Management Agreements set forth the cost and expenses and paragraph 11 of the Management Agreements set forth the default conditions. These paragraphs refer to Wireless' obligations to Ameritel pursuant to the leases; neither Tsang nor Wireless were direct parties to the leases. The Management Agreements clearly apprised defendants that they would be responsible for Ameritel's obligations under the leases. The fact that defendants did not demand to directly review the leases, but signed the Agreements and Guarantees in ignorance, does not relieve them of their contractual obligations. The Management Agreements do not lack essential material terms by referencing the leases to determine precise obligations.

Although defendants argue that the Management Agreements were merely unenforceable agreements to agree, there were no further negotiations contemplated or undertaken by the parties after the execution of the Management Agreements (see Central Park Electronics, Inc. v Hyundai Electronics Am., 1996 WL 537660, *3 [SD NY, Sept. 20, 1996, No. 95-CV-4201 (LAP)]). While defendants contend that they requested and were promised profit and loss statements, defendants executed the Management Agreements without requiring such profit and loss statements prior to execution and without making the receipt of such profit and loss statements a condition precedent to the enforceability of the Management Agreements. There were no contingencies, conditions, or terms left open for further negotiation in the Management Agreements. The written Agreements, albeit highly favorable to the plaintiff, were complete.

Moreover, "the existence of a contract may be established through the conduct of the parties recognizing the contract" (Apex Oil Co. v Vanguard Oil & Serv. Co., 760 F2d 417, 422 [2d Cir 1985]). "In determining whether the parties' conduct is consistent with the existence of a binding contract, [i]t is necessary that the totality of all acts of the parties, their relationship and their objectives be considered'" (H/R Stone, Inc. v Phoenix Business Systems, Inc., 660 F Supp 351, 356 [SD NY 1987], quoting P.J. Carlin Constr. Co. v Whiffen Elec. Co., 66 AD2d 684, 684 [1st Dept 1978], appeal dismissed 46 NY2d [*12]1075 [1979]). A review of Wireless' conduct after it signed the Management Agreements indicates that it understood them to be binding and enforceable. After execution of the Management Agreements, Ameritel provided T-Mobile products and services to Wireless, and Wireless assumed the management and operations of the Mall Stores, sold T-Mobile plans and equipment, paid rent under the leases, and paid its employees. The fact that defendants performed under the Management Agreements by paying the rent under the leases, the lack of receipt of which they now assert as a basis for not being bound, is compelling evidence of their intent to be bound (see e.g. TAJ Intl. Corp. v Bashian & Sons, 251 AD2d 98, 101 [1st Dept 1998] [finding adherence to a payment schedule as evidence of a binding agreement]). The Court again notes the pre-existing relationship between the parties for the operation of two other stores by defendants. Presumably, defendants were already aware of plaintiff's expectations. The argument of defendants, that the failure to sign expeditiously might result in the loss of the opportunity, indicates that defendants willingly and eagerly entered into what was understood to be a binding agreement.

Thus, inasmuch as the Management Agreements contained all material terms, did not contemplate any future negotiation, and evinced the parties' intent to be bound, and since the parties performed under the Management Agreements, the Management Agreements are legally binding as a matter of law (see Tractebel Energy Marketing, Inc., 487 F3d at 95). Consequently, having established Wireless' default under the Management Agreements, Ameritel has demonstrated its entitlement to judgment as a matter of law against Wireless under the Management Agreements. In addition, Tsang may be held liable to Ameritel, pursuant to the Guarantees, which unconditionally guaranteed the complete and timely performance by Wireless of all of its obligations and full and prompt payment under the Management Agreements (see generally TD Bank, N.A. v Clinton Ct. Dev., LLC, 105 AD3d 1032, 1035 [2d Dept 2013]). Thus, Ameritel is entitled to summary judgment on its breach of contract claim (see CPLR 3212 [b]).

Ameritel's complaint conclusorily seeks damages in an amount in excess of $289,000. While paragraph 15 (a) of the Management Agreements provides for the recovery by Ameritel of liquidated damages in an amount equal to all rent, additional rent, and "other charges" which may become due under the leases for the Mall Stores during the 12 months following the date of termination, an inquest is required in order to ascertain and calculate the exact amount actually due to Ameritel under this provision.

Ameritel also seeks dismissal of all of defendants' counterclaims and defendants, in seeking summary judgment in their favor, assert, in their papers, that they are entitled to summary judgment on their second counterclaim for negligent misrepresentation and their fourth counterclaim for rescission.

With respect to defendants' second counterclaim for negligent misrepresentation, "[i]t is well settled that [a] claim for negligent misrepresentation requires the plaintiff to [*13]demonstrate (1) the existence of a special or privity-like relationship imposing a duty on the defendant to impart correct information to the plaintiff; (2) that the information was incorrect; and (3) reasonable reliance on the information'" (Mandarin Trading Ltd. v Wildenstein, 16 NY3d 173, 180 [2011], quoting J.A.O. Acquisition Corp. v Stavitsky, 8 NY3d 144, 148 [2007], rearg denied 8 NY3d 939 [2007]; see also Parrott v Coopers & Lybrand, 95 NY2d 479, 483-484 [2000]).

Defendants contend that they and Ameritel had the required privity-like relationship through privity of contract based upon the execution of the Management Agreements. They assert that Ameritel, therefore, had a duty to impart correct information. They claim that, prior to executing the Management Agreements, they reasonably relied upon McGann's oral representations (disputed by plaintiff) that the Mall Stores were profitable and each was making $5,000 in net profits, and that, after execution of the Management Agreements, they reasonably relied upon the profit and loss statement for the Sunvalley Store given to them in July 2007 in continuing to operate the Mall Stores.

"In the commercial context, liability for negligent misrepresentation has been imposed only on those persons who possess unique or specialized expertise, or who are in a special position of confidence and trust with the injured party such that reliance on the negligent misrepresentation is justified'" (Fresh Direct v Blue Martini Software, 7 AD3d 487, 489 [2d Dept 2004], quoting Kimmel v Schaefer, 89 NY2d 257, 263 [1996]). Moreover, a claim of negligent misrepresentation cannot be independently asserted within the context of a breach of contract action unless "the alleged misrepresentation concerns a matter which is extraneous to the contract itself" (Alamo Contract Bldrs. v CTF Hotel Co., 242 AD2d 643, 644 [2d Dept 1997]; see also Fresh Direct, 8 AD3d at 489).

Here, while defendants argue that a relationship of privity existed based upon the contractual relationship resulting from the execution of the Management Agreements, there is no evidence of a special relationship between the parties. A contractual relationship in a commercial setting does not by itself create the privity or special relationship required for a negligence cause of action (see e.g. Gardianos v Calpine Corp.,16 AD3d 456, 456 [2d Dept 2005]). There was no close degree of trust or confidence between Ameritel and defendants or any fiduciary duty owed by Ameritel to defendants, but, rather, the parties dealt at arm's length in a commercial transaction (see In re Mid-Island Hosp., Inc., 276 F3d 123, 130 [2d Cir 2002], cert denied 537 US 882 [2002]; Emmons v City University of New York, 715 F Supp 2d 394, 422 [ED NY 2010]; WIT Holding Corp. v Klein, 282 AD2d 527, 529 [2d Dept 2001]; DeSouza v Sbarro, Inc., 221 AD2d 309, 309 [2d Dept 1995]). It is also clear that the alleged misrepresentations were directly relevant to the contract.

Defendants assert that they were given incorrect information in July 2007. They support this assertion by pointing out an inconsistency between the profit and loss statement produced by Ziegler for the Sunvalley Store, per Tsang's request for the months [*14]of January 2007 through April 2007, via an e-mail to McGann on July 3, 2007, showing a gross profit consistent with verbal representations of profit of $5,000 per month, as compared to a profit and loss statement which McGann then e-mailed to Morofsky on July 5, 2007, which was ultimately received by defendants. Defendants contend that the July 5 profit and loss statement showed a higher profit for the Sunvalley Store than the one which was e-mailed on July 3 by Ziegler to McGann for the same period of time. Ziegler, at his deposition, testified that the profit and loss statement which he prepared was simply a sample profit and loss statement for the purpose of explaining to a person that is not familiar with the business how a profit and loss statement works (Ziegler's Dep. Transcript at 68-71). The significance of this minor discrepancy, in any event, eludes the court since the profit and loss statements were provided months after the Agreements had been executed and after defendants had commenced to perform. The profit and loss statements could not, therefore, have been relied upon by defendants in executing the Agreements.

Defendants, in contending that Ameritel engaged in a fraudulent scheme, which involved negligent misrepresentations, further heavily rely upon an e-mail, dated January 30, 2009, from David Willard (Willard), a former employee of Ameritel, in which Willard sets forth that Tsang "thought he would be getting the residual income due to the reporting Andrei/Ameritel . . . gave to him." Willard, in this e-mail, purportedly states that he found out that "the reporting given to . . . Tsang was a false document," that "Andrei played with the numbers on the report in order to push . . . Tsang into taking over the store," that "Andrei called himself the master of making false reporting' and laughed about it with him," and that "Andrei didn't want to help out [Tsang] because he didn't like him and wanted him to fail so he could sell off the stores to another partner or another company." Such e-mail, however, constitutes inadmissible hearsay, and defendants, who never took Willard's deposition, have failed to provide any excuse as to why they have failed to tender such alleged evidence in admissible form (see Wynne v Diaz, 102 AD3d 862, 864-865 [2d Dept 2013]).

Furthermore, defendants have not shown reasonable reliance upon the information alleged to have been provided since defendants knew they had no written profit or loss statements at the time they executed the Management Agreements, and the Management Agreements provided, in paragraph 24 (a), that the Management Agreements constituted the entire agreements between the parties and that no representations, inducements, or promises not embodied therein had any force or effect. While Tsang asserts that he did not even read the Management Agreements prior to executing them, he cannot avoid their binding effect or avoid any terms therein because he was unaware of them due to his own negligent failure to read them (see generally Scott v Fields, 85 AD3d 756, 758 [2d Dept 2011]). In addition, as noted above, the July 2007 profit and loss statement was received by defendants only after Wireless had already executed the Management Agreements and could not, therefore, be the basis for Wireless' entry into such agreements.. [*15]

Thus, defendants have failed to support a viable counterclaim for negligent misrepresentation (see WIT Holding Corp., 282 AD2d at 529). Summary judgment dismissing this counterclaim is, therefore, mandated (see CPLR 3212 [b]).

Defendants' first counterclaim for fraud and third counterclaim for fraudulent concealment must similarly be dismissed since there was no reasonable reliance on any alleged misrepresentations by Ameritel and no concealment of information by Ameritel, as defendants were aware of the fact that they never received the profit and loss statements but decided to proceed with the transaction without such information (see KNK Enters., Inc. v Harriman Enters., Inc., 33 AD3d 872, 872 [2d Dept 2006], lv denied 8 NY3d 804 [2007]). Since defendants were aware that they did not have this information, they cannot now be heard to complain that they were induced to enter into the transaction by misrepresentations (see Orlando v Kukielka, 40 AD3d 829, 831 [2d Dept 2007]).

As to defendants' fourth counterclaim for rescission, since the court finds that no evidence of fraudulent inducement has been properly produced and that the Management Agreements are enforceable contracts, rescission is not available as a remedy to defendants (see Babylon Assoc. v County of Suffolk,101 AD2d 207, 215 [2d Dept 1984]). Tsang's attempt to avoid the terms of the Management Agreements based upon his allegation that he was told that Ameritel would give the Mall Stores to another party if he did not sign the Management Agreements must be rejected. In order to rescind and void a contract based on economic duress, an agreement must have been procured by means of a wrongful threat that precluded the exercise of free will; mere financial pressure is insufficient to constitute duress (see Sitar v Sitar, 61 AD3d 739, 742 [2d Dept 2009]).

Dismissal of defendants' fifth counterclaim for breach of contract is denied. Under paragraph 17 of the Management Agreements, Ameritel, based upon defendants' default, had the right to offset, against defendant's commissions, including amounts with respect to the Vacaville Store and the Dixon Store, any amounts owed to it. Defendants have alleged, however, that plaintiff failed to pay commissions due. As the sums due to defendant Wireless will necessarily be a factor in assessing the damages due to plaintiff, defendants must be afforded the opportunity to prove its own entitlement to compensation.

Defendants' sixth and seventh counterclaims alleging breach of the implied covenant of good faith and fair dealing due to the alleged failure to pay residuals owed and full commissions and the alleged failure to give accurate profit and loss statements for the Mall Stores, respectively, cannot be maintained since the breaches alleged are "intrinsically tied to the damages allegedly resulting from a breach of the contract" and such counterclaims are therefore redundant of a breach of contract claim (Hawthorne Group v RRE Ventures, 7 AD3d 320, 323 [1st Dept 2004] [internal quotation marks omitted]; see also Triton Partners v Prudential Sec., 301 AD2d 411, 411 [1st Dept 2003]). Defendants' eighth counterclaim for conversion must also be dismissed since it is [*16]predicated on a mere breach of contract and does not properly sound in tort (see Zendler Constr. Co., Inc. v First Adj. Group, Inc., 59 AD3d 439, 441 [2d Dept 2009]; Wolf v National Council of Young Israel, 264 AD2d 416, 417 [2d Dept 1999]).

Defendants' tenth counterclaim for intentional infliction of emotional distress is also not cognizable since there was no extreme or outrageous conduct "as to go beyond all possible bounds of decency" as is required to maintain such a claim (Tartaro v Allstate Indem. Co., 56 AD3d 758, 759 [2d Dept 2008] [internal quotation marks omitted]).

Finally, although defendants' fifth counterclaim remains viable, defendants' demand for punitive damages is dismissed since defendants are not entitled to such damages in light of the fact that the alleged conduct by Ameritel does not constitute morally culpable conduct or conduct "actuated by evil and reprehensible motives" (Walker v Sheldon,10 NY2d 401, 404 [1961]; see also CDR Créances S.A.S. v Cohen, 62 AD3d 576, 577 [1st Dept 2009]), nor is there any evidence of "a pattern of egregious conduct directed toward the public at large" (Tartaro, 56 AD3d at 759).

Accordingly, Ameritel's motion for summary judgment in its favor as to liability and dismissing defendants' counterclaims is granted as to the first through fourth, and sixth through tenth counterclaims, and denied as to the fifth counterclaim, except that the claim for punitive damages is dismissed. An inquest on damages shall be held to compute the amounts due to Ameritel pursuant to paragraph 15 (a) of the Management Agreements and any sum due to defendants. Defendants' motion for summary judgment is denied.

This constitutes the decision, order, and judgment of the court.

E N T E R,

J. S. C.