GOLDNER v. STATE UNIVERSITY OF NEW YORK AT STONY BROOK, #2002-030-503, Claim No.
97670, Motion Nos. M-64107, CM-64243
Claimant's motion for summary judgment granted. SUNY Stony Brook breached
express contract. No need to examine extrinsic evidence, any ambiguities
resolved within the four corners of the contract. Claimant precluded from
recovery on alternate theories of implied contract and quantum meruit,
given Court's ruling that recovery for breach of express contract
FREDRIC S. GOLDNER, doing business as ENERGY MANAGEMENT & RESEARCH ASSOCIATES
Footnote (claimant name)
STATE UNIVERSITY OF NEW YORK AT STONY BROOK
Footnote (defendant name)
THOMAS H. SCUCCIMARRA
LAW OFFICES OF LAURA A. BREVETTI by FREDERICK J. ANTON, ESQ.
ELIOT SPITZER, NEW YORK STATE ATTORNEY GENERALBy: ARTHUR PATANE, ASSISTANT ATTORNEY GENERAL
February 1, 2002
See also (multicaptioned
The following papers have been read on Claimant's motion for summary judgment,
and Defendant's cross-motion for summary judgment, both marked fully submitted
on November 21, 2001:
1,2,3,4 Notice of Motion; Affirmation in Support by Frederick J. Anton, Esq.,
with accompanying exhibits and deposition transcripts; Affidavit of Cynthia R.
Clark, Esq., and accompanying exhibits; Memorandum of Law.
5,6,7,8 Notice of Cross-Motion; Affidavit in Support of Cross-Motion and in
Opposition to Claimant's Motion by Mark Maciulaitis with accompanying exhibits;
Affidavit in Support of Cross-Motion and in Opposition to Claimant's Motion by
Arthur Patane, Esq.; Memorandum of Law.
9,10 Affirmation in Opposition to Cross-Motion by Frederick J. Anton, Esq.,
with accompanying exhibit; Affidavit in Opposition to Cross-Motion by Fredric S.
11,12 Reply Affidavit of Fredric S. Goldner in further support of Claimant's
Motion for Summary Judgment; Reply Memorandum of Law.
13,14 Filed Papers: Verified Claim; Verified Answer.
Fredric S. Goldner, doing business as Energy Management & Research
Associates, (hereafter Claimant or Goldner) filed a Verified Claim on or about
January 16, 1998 alleging, among other things, that the Defendant, the State
University of New York at Stony Brook, had breached an express contract entered
into between the parties, by a failure to pay sums due to the Claimant. It is
undisputed that the contract at issue includes an Agreement dated September 21,
1993 (hereafter Agreement), incorporating Bid Proposal 92/93-074MC (hereafter
Bid Proposal) issued for bid by Defendant on or about April 15, 1993, as well as
a standard rider "setting forth various governmental requirements...."
(hereafter rider) [ Paragraph "7", Affidavit of Mark Maciulaitis sworn to
October 30, 2001 in Support of Cross-Motion].
The general outline of the parties' obligations under the contract, as set
forth in the Agreement portion, were that the Claimant would provide "utility
billing auditing services" in accordance with the incorporated Bid
. Payment of the Claimant's fee was
conditioned upon "savings realized." Claimant would receive "a 30% flat fee of
the refunds issued to Defendant as a result of the audit process."
Undisputed portions of the Verified Claim allege that after the agreement was
entered into, Claimant commenced performance. In or about June, 1994, Claimant
reported an error in a Long Island Lighting Company (hereafter LILCO) bill for
the period June 1, 1988 through July 5, 1988. On September 15, 1994 Claimant
submitted an invoice to Defendant representing 30% of the refund issued to
Defendant, which was paid by Defendant in or about March, 1995.
In or about January, 1995, Claimant told Defendant of the availability of an
alternative, more beneficial, utility rate available to the Defendant since
August 15, 1991. [Exhibit "12", Affirmation in Support by Frederick J. Anton].
Claimant alleges that the savings which could have been realized for that period
would be in the amount of $1,776,715.00. [Paragraph 36, Verified Claim]. While
Defendant admits in its Answer to two meetings between the parties in March,
1995 and in April, 1995, Defendant denies that the purpose of those meetings
was, respectively, "to discuss strategy relating to the claim to recover the
estimated $2 million overpayment from LILCO," [Paragraph "48" Verified Claim;
Paragraph "2" Verified Answer], and "to renegotiate Claimant's fee under the
Contract."[Paragraph "57" Verified Claim; Paragraph "2" Verified Answer].
In or about June, 1997, Defendant and LILCO entered into a Settlement Agreement
whereby Defendant received the equivalent of the $1,500,000.00 representing the
difference between the amount charged and the amount which should have been
charged under the alternate rate
Defendant did not pay the Claimant any fee for the savings realized.
As a preliminary matter, Defendant has raised the issue of the sufficiency of
Claimant's support for its motion for summary judgment, and would have this
court deny the motion on procedural grounds alone.
§3212(b) Civil Practice Law and Rules provides in pertinent part:
....A motion for summary judgment shall be supported by affidavit, by a copy of
the pleadings and by other available proof, such as depositions and written
admissions. The affidavit shall be by a person having knowledge of the facts;
it shall recite all the material facts; and it shall show that there is no
defense to the cause of action or that the cause of action or defense has no
merit. The motion shall be granted if, upon all the papers and proof submitted
the cause of action or defense shall be established sufficiently to warrant the
court as a matter of law in directing judgment in favor of any party....the
motion shall be denied if any party shall show facts sufficient to require a
trial of any issue of fact. If it shall appear that any party other than the
moving party is entitled to a summary judgment, the court may grant such
judgment without the necessity of a cross-motion.
Assuming a movant has made a prima facie
entitlement to judgment as a matter of law by proffering sufficient evidence to
eliminate any genuine, material, issues of fact, the party in opposition to the
motion for summary judgment must tender evidentiary proof in admissible form to
establish the existence of material issues which require a trial. Winegrad v
New York University Medical Center
, 64 NY2d 851 (1985); Zuckerman v City
of New York
, 49 NY2d 557 (1980). While it is not the best practice, the use
of an attorney's affirmation appending pertinent deposition testimony,
documentary evidence, and a verified pleading reciting material facts, is not a
fatal procedural flaw in the Claimant's presentation. Alvarez v Prospect
, 68 NY2d 320, 325 (1986).
Additionally, §105(u) Civil Practice Law and Rules indicates that "...[a]
‘verified pleading' may be utilized as an affidavit whenever the latter is
required." While it is something of an overstatement to declare that "...[t]here
is no question that a plaintiff may support a motion for summary judgment with a
copy of his verified pleading
omitted)", [Pages 1-2; Reply Memorandum of Law in further support of Claimant's
Motion for Summary Judgment], the use of a detailed verified pleading will
suffice here, accompanied as it is by the necessary documentary evidence and
deposition testimony. Alvarez v Prospect Hospital
Moreover, in reply to the Defendant's arguments concerning the sufficiency of
Claimant's motion, Claimant furnished additional affidavits from Fredric S.
Goldner - clearly "...a person having knowledge of the facts..." [§ 3212(b)
Civil Practice Law and Rules] - as well as an additional Memorandum of Law, yet
Defendant did not seek leave to file a sur-reply or additional memorandum of law
addressing the merits once Claimant's submissions were served and filed.
Accordingly, and as previously noted, the Court is satisfied that the Claimant's
motion is adequately supported as an initial matter.
New York State subscribes to the so-called "four corners rule" in analyzing
contracts. As noted by the Court of Appeals, there is "...a vital first step
in the analysis: before looking to [extrinsic] evidence of what was in the
parties' minds, a court must give due weight to what was in their contract. A
familiar and eminently sensible proposition of law is that, when parties set
down their agreement in a clear, complete document, their writing should as a
rule be enforced according to its terms. Evidence outside the four corners of
the document as to what was really intended but unstated or misstated is
generally inadmissible to add to or vary the writing...(citations
omitted). That rule imparts ‘stability to commercial transactions by
safeguarding against fraudulent claims, perjury, death of witnesses ...
infirmity of memory ... [and] the fear that the...[fact finder] will improperly
evaluate the extrinsic evidence.' (Fisch, New York Evidence § 42, at 22 [2d
ed].)... Whether or not a writing is ambiguous is a question of law to be
resolved by the courts (Van Wagner Adv. Corp. v S & M Enters., 67 NY2d 186,
191)." W.W.W. Associates, Inc. v Giancontieri, 77 NY2d 157,161-162
(1990); See, also, Hudson-Port Ewen Associates, L.P. v Kuo,
78 NY2d 944, 945 (1991); Hartford Accident & Indemnity Co. v
Wesolowski, 33 NY2d 169,172 (1973).
Because a party urges one interpretation of a contract, while the other party
urges a different construction, the agreement's terms are not rendered
ambiguous, requiring consideration of parol evidence to determine the intent of
Thus in Bethlehem Steel Co. v
Turner Construction Co.
, 2 NY2d 456, 459 (1957), the Court focused on the
meaning of the words "prices for component materials" contained in a contract
allowing escalation of the prices charged based upon an increase in the "prices
for component materials." Looking at the contract as a whole, the Court was
able to discern the meaning of the terms employed in the contract, and found
that summary judgment had been properly granted.
In this case, it is conceded that three writings prepared by Defendant make up
the express contract between the parties: the Bid Proposal, the written
Agreement, and the rider. The written Agreement provides: "WHEREAS the
UNIVERSITIES desire to enter into an agreement for Utility Billing Auditing
Services to identify over charges by service providers and to negotiate
refunds....1. CONTRACTOR agrees to provide services mentioned above and in
accordance with bid proposal 92/93-074 MC attached hereto and made a part of
this agreement...2. UNIVERSITIES shall pay the CONTRACTOR a 30% total flat fee
of the refunds issued to the Universities as a result of the audit process. If
no savings are realized, there will be no fee paid to the CONTRACTOR; in
addition no fees will be paid on future savings. Fees will be paid through the
audit completion date only." The Defendant could terminate the contract with
thirty (30) day written notice, and there is a clause prohibiting Claimant from
assignment as it was "understood...that this agreement is intended to secure the
personal services of the CONTRACTOR because of its ability and reputation."
The Bid Proposal indicates under the "Objectives" portion the
of the request for bids as:
The State University of New York at Stony Brook, State University of New York
College at Farmingdale and the State University of New York College at Old
Westbury, referred to herein as the ‘Universities', intend to contract
with a qualified auditing firm, experienced in the billing procedures of utility
companies; electric, gas, sewer and water (excluding telephones), to conduct
billing reviews of past invoices for the negotiation with and the recovery from
utility providers of any overpayments and correction of all future billings.
The State University of New York at Stony Brook is coordinating this request for
proposal on behalf of...[the other campuses] as well as its own facility.
The auditing firm selected will provide the following services:
(a) ab Audit all utility billings and fees and rentals to determine compliance
with rates in force at the time;
(b) ab Determine accuracy of all utility billings and any sewer rentals versus
actual services provided and report on discrepancies;
(c) ab Act, as required, on the Universities' behalf to reconcile records and
to procure funds for past overpayments;
(e) ab Provide narrative reports covering the Universities' utility environment
which identify the areas of deficiencies in utility billing and rate
verification, in order that the agency can implement controls to avoid
inappropriate payments in the future.
Under the "Scope of Work"
portion of the Bid
Proposal, immediately following the "Purpose" section, and after reciting the
current utility budgets for the three campuses using the language "in excess of
$25,000,000.00" when referring to SUNY Stony Brook, the language continues as
.....The Universities seek bid proposals from qualified utility auditing
consultants to provide a complete billing audit for the Universities with the
express intent of identifying overcharges by service providers and to negotiate
Consultant fees will be a percentage of the refunds issued to the Universities
as a result of the audit process. If no savings are realized, there will be no
fee paid to the consultant; in addition no fees will be paid on future savings.
Fees will be paid through the audit completion date only.
...It should be stressed that the Universities are not seeking to alter utility
system designs or buy new equipment. This bid is intended solely for billing
charge audit. Bidders should not include proposals for system design changes,
new equipment or other consultant services in their responses.
The Bid Proposal sets forth what it requires in terms of experience from a
successful bidder, and what types of information should be furnished in any bid.
Under "General Qualifications"
To be considered responsive to bid requirements, the bidders expertise and
depth of auditing disciplines shall include, but not necessarily be limited to,
qualified experience with the following:
(a) abAudit of various sizes and types of utility systems
(b) abReview of Customer Service Records...
(c) abAnalysis of usage calculations and rates
(d) abNegotiation with service providers (i.e. Long Island Suffolk County Sewer
District #1, etc.)
(e) abDevelopment of programs to improve client communications cost monitoring
of utility charges
(f) abKnowledge of applicable Public Service Commission rules and
Bidders must demonstrate that the Project Team will consist of qualified
utility auditors or persons with appropriate academic accounting training and
proven related experience.
Bidders were required to furnish the resumes of all personnel working on the
project as well as corporate financial statements, and descriptions of the
firm's experience, including prior "...utility consulting/auditing customers
served by the consulting firm over the past three (3)
They were required to provide:
A comprehensive description of the bidders technical approach to providing the
required services including a listing of project tasks and a general schedule
for completion to include:
(a) ab A proposed schedule...of activities and events, for the implementation
and completion of the Scope of Work detailed in Section I.2 will be required.
This schedule will be subject to approval by Universities.
(b) ab The technical proposal must specifically address how the bidder would
approach an audit of utility bills for the Universities which might reasonably
expect to yield a savings.
(c) ab The proposal must specify at what point in the audit process the
calculation of potential credits subject to vendor fees is concluded.
In terms of who would be selected, the Bid Proposal
Bidder selection will be based upon, but not limited to, such criteria
(a) abRelevant experience and qualification of personnel to be assigned to the
(b) abThe firm's demonstrated knowledge of contemporary, state-of the art
utility technology and rates.
(c) abThe firm's demonstrated level of experience and competence in the field
of utility rate auditing especially as applicable to large governmental
(f) ab Cost and reasonableness of the firm's financial proposal.
Finally, in terms of "Consultant's Fees"
the Bid Proposal provides:
In the submitted proposal the bidder is to state the percentage of return
expected from monies recovered from utility services providers. When refund
credits are received, the contractor will be paid the agreed percentage of total
credit/refund received. Where there is no refund or credit there shall be no
fee or expenses whatsoever. No consultant fees will be paid upon future billing
savings to the Universities.
For retroactive refunds or credits, the specified percentage fee shall be
payable quarterly upon receipt of a properly dated invoice by each University
according to Standard State Procedures....It shall be understood that the
contractor is to be aggressive and diligent in obtaining any and all
The agency will at all times assist in providing whatever documentation is
needed to obtain the maximum return of overcharges, as determined. In all
cases, the agreed percentage fee will apply.
In the factual Affidavit submitted by Counsel for the Defendant the affiant
confirms that "Claimant...notified Stony Brook that in addition to the rate
under which its utility bills had been calculated, Stony Brook was also entitled
to select a second or alternative rate. Claimant also offered that in the event
that Stony Brook would select the second available rate and ‘redo' its
past billings, it might result in substantially lower bills....Subsequently,
Goldner demanded that in the event Stony Brook selected the second available
rate and that rate was applied by the utility company retroactively to past
billings, that it then be paid 30% of the difference between the amount billed
by Stony Brook under the first rate and the amount billed under the second
rate.....Stony Brook rejected claimant's demand." [Paragraphs 12-14, Affidavit
of Mark Maciulaitis].
Parenthetically, on or about October 18, 1994 Claimant wrote a letter [Exhibit
"11", Affirmation in Support of Frederick J. Anton] to Enrico Johnson, Senior
Budget Analyst and the self-described "middle person between accounts
payable....[and] Goldner...." [Examination Before Trial of Enrico Johnson, Page
38]. In the letter Claimant sought further authorizations from Defendant
directed to LILCO in order to review the utility's bills for 1990 through 1994,
and suggested additional services described as "Part 2. A review of applicable
rate tariffs to determine if the facility would benefit from a change in rate
classification." Claimant continued: "Due to our desire to respond to the
specific language in your...[bid proposal] we did not request that Part 2
services be included in the contract. Therefore, based on the terms of our
contract, we have only been providing Part 1
to the University. Because of
this situation, the University is not availing themselves of the opportunity for
a complete and comprehensive Utility Rate Audit....We would like to propose that
we expand the scope of the current contract to include Part 2 services as
The proposed addendum enclosed indicates: "If new and beneficial rate
classification(s) are determined by...[Claimant] to be applicable, and a switch
over is made to the new rate classification...the Universities agrees to
pay...[Claimant] 30% of the savings, for a period of two (2) years following
such a switch over. Savings will be calculated by subtracting the actual
charges from the charges that the facility would have incurred if the switch
over had not occurred." This addendum was not executed.
Exhibits furnished by Claimant confirm that the Defendant was notified in
writing of the availability of the alternative rate by letters dated January 10,
1995. [Exhibits "12" & "13", Affirmation in Support of Frederick J. Anton].
By its terms, one letter indicates that there had been some oral discussion of
the alternative rate. [Exhibit "12"]. The letters enclosed a breakdown of the
charge differences in chart form showing the savings which would be realized
under the alternative rate, noted the obligations of LILCO to adequately advise
its largest customer of alternative rates, and the potential liability of LILCO
had it failed to advise of the beneficial rate.
In uncontradicted deposition testimony David Price, one of the Claimant's
principals, states that the "bulk" of a letter placed on Stony Brook
stationary, dated February 15, 1995, directed to LILCO, and signed by Harry
Snoreck,Vice President of Stony Brook, was written by the deponent. [ Page
43-44, Transcript of David C. Price]. The letter indicates in pertinent part:
"....As part of...[the utility bill audit] process, it has come to our attention
that the above-referenced account has been eligible for an alternate rate in
accordance with a schedule revision which went into effect on August 15, 1991
(Rate 285- Rate 2). Since this alternative rate was introduced after we had
initially contracted for service, we believe that LILCO had the responsibility
to inform us of the existence of the new rate tariff and to assist us in
determining its impact.....Our audit investigation reveals that, had the
University been properly advised and assisted by LILCO, we would have elected to
take advantage of the alternate rate and would have received the benefit of
substantial reductions. We estimate the resulting overpayment to LILCO as
approximately $2 million." [Exhibit "15", Letter to LILCO from Harry Snoreck,
Vice President Stony Brook, dated February 15, 1995].
Judging by the memoranda going back and forth within Stony Brook,[Exhibits
"19", "20"], there was at least one meeting in which the parties discussed
Claimant's receipt of a fee - at a reduced
- continued discussion concerning
Stony Brook pursuing the overpayments on
and the genesis of the current
dispute over the scope of the contract.
There was also some activity with regard to analyzing overpayments during the
latter part of calendar year 1994 and early 1995 based upon an alternative rate.
, Exhibits "17" and "18", Letters between Stony Brook and
David Price dated March, 1995]
The depositions of Defendant's agents confirm that Stony Brook decided to
pursue the overpayment issue on its own, and took the position that no
compensation was due Claimant because the work performed was outside the scope
of the contract.
memoranda between Stony Brook personnel confirms the university's view that it
had unilaterally determined to pursue negotiations with LILCO on its
The uncontradicted documentary evidence indicates that on July 10, 1995
Claimant wrote to Mark Maciulaitis, Stony Brook's Director of Budget and
Analysis, saying [Exhibit "21"]:
Over 6 months ago, as a direct result of our ongoing utility bill analysis for
Stonybrook University, we discovered a potential $2,000,000 overcharge, by
LILCO, on one of the University's electric accounts. In accordance with our
agreement, we informed the University of our findings prior to approaching
LILCO. We were then asked, by Stonybrook University, to draft a sample letter
to LILCO requesting payment. This letter was used as the basis for a letter
the University sent to LILCO on February 15, 1995....
A meeting was then held on March 8, 1995, attended by members of our firm and
Stonybrook University personnel, to discuss the current status of events and to
decide on the best method for proceeding with the claim against LILCO. At that
time it was decided, by Stonybrook University, that the University had a better
chance of obtaining a quick resolution from LILCO and therefore would be the one
to pursue this matter. Our position, then and now, is that we are ready,
willing and able to pursue this matter on the University's behalf in accordance
with our contract. This point was reemphasized in a subsequent meeting between
our staff and University personnel that was held on April 15, 1995.
In the four months that have elapsed between the meeting of March 8, 1995 and
the present we have attempted to determine, via several telephone calls, the
results, if any, of the negotiations between the University and LILCO. Our
efforts have been to no avail as we have been informed, each time, that no new
information is available.
I therefore respectfully request that we be provided with a written update on
the current status of this issue. If the University has been unable to achieve
any results I request that we be given the opportunity to pursue this matter in
accordance with the terms of our original contract....
According to the deposition of Gerianne Sands, counsel to Stony Brook, Claimant
continued to request updates
specifically told, in a letter dated October 2, 1996 drafted by the witness but
signed by President Shirley Strum Kenny, that she had been kept apprised of
"...the ongoing progress of efforts to recover from LILCO any refunds to which
the University is entitled. Since I am advised by counsel that these efforts
fall outside the scope of the work performed by your organization, I concur with
my staff's conclusion that regular updates to you regarding the progress of
these confidential negotiations were not warranted under the circumstances...."
[Exhibit "22" , Affirmation of Frederick J. Anton].
Finally, the depositions of Defendant's employees also indicate that most were
not expert in "utility bill auditing" or "energy conservation or energy
Apart from some internal monitoring
of meter readings versus bills rendered by
, and a yearly notification on rates,
"there was never analysis of what other rates were out there that the university
could switch to...."
Under the terms of a Settlement Agreement reached between LILCO and Defendant,
"...the total dollar value received by Stony Brook...was $1,500,000.00." [Page
2, Par. 6, Affidavit of Cynthia R. Clark, Esq.]. The Settlement Agreement was
memorialized in a writing dated June 13, 1997, and in a Rider dated February 9,
1998, and is comprised of a combination of cash payments, construction of gas
lines and conversion of certain boilers to ‘dual fuel', and credits on
account. [Ibid., Par. 7].
A fair reading of the contract shows that the intent of the parties was to save
money for the university. This thought is pronounced again and again throughout
the Agreement and the Bid Proposal. Defendant wanted someone "to identify over
charges by service providers and to negotiate
wanted "qualified utility
auditing consultants to provide a complete billing audit...with the express
intent of identifying overcharges by service providers and to negotiate
Even the fee provisions,
calling for payment, as they do, only upon satisfaction of certain
contingencies, evidence the clear intent of the parties that this was to be a
venture designed to save the Defendant money.
What was not contracted for, i.e.: alteration of system designs or new
equipment; and future savings, was expressly stated in the written instrument.
Payment of the fees to the Claimant depended upon "refunds issued to
the...[Defendant] as a result of the audit
The Agreement provided that only
Claimant could furnish the "personal services" called for, based upon the depth
of its experience.
Although the words "audit process" and "utility billing audit" are not defined
specifically within the contract - indeed, none of the terms of the contract are
defined - their meaning can be gleaned from the instrument when read as a whole.
, Hudson-Port Ewen Associates, L.P. v Kuo
945; Bethlehem Steel Co. v Turner Construction Co.
459-460. This Claimant was required to look for any way it could to save money
for this Defendant, and was selected with the view that its expertise was
superior to that of Stony Brook's employees. The Bid Proposal states: "The
auditing firm selected will provide the following services:...audit all utility
billings and fees and rentals to determine compliance with rates in force at
the successful bidder was to
possess "...expertise and depth of auditing disciplines...[including] analysis
of usage calculations and rates...negotiation with service
providers....[k]nowledge of applicable Public Service Commission rules and
The Claimant was "...to be
aggressive and diligent in obtaining any and all refunds/credits
In this Court's view, as one element
of the "utility billing audit" determination of the most cost effective rate
available to the Defendant, and comparison of the cost of service under one
rate, versus the cost of service under another, is clearly included, and indeed
called for by this contract. It goes against logic and a plain and sensible
reading of the contract to say, as the Defendant would urge, that the Claimant -
experienced and knowledgeable as it was - was to identify only certain types of
overcharges and not others.
There is no evidence that Defendant learned of the alternative rate from any
source other than Claimant, despite the monitoring of the utility bills by
Defendant's agents in place at the time. Indeed, it was Claimant who advised
that any failure by LILCO to notify the Defendant of alternative rate schedules
would be, if not actionable, then at least a bargaining chip in any negotiation
for a refund.
The Claimant was expressly required to negotiate with the utility
From the uncontroverted facts as
shown in the depositions of its employees, and internal memoranda, Defendant
essentially preempted Claimant's ability to perform under the contract, by
determining that it would preside over the negotiations with LILCO. This flies
in the face of a rule that is axiomatic: the implied condition in every contract
that one party will not prevent the other's performance. See
, In re
People by Phillips
, 250 NY 410 (1929).
There is no evidence contradicting the Claimant's assertions that in addition
to the existence of the alternate rate, it advised the Defendant of LILCO's
notice obligations, it reminded the Defendant that as LILCO's largest customer
Stony Brook had a good bargaining position, and it drafted the letter
constituting the first foray into negotiations with LILCO to obtain a refund.
All the evidence presented shows that Claimant continued to try to perform the
negotiation aspect of its obligation under the contract, but was prevented from
doing so. The fact that the Defendant ultimately negotiated a refund itself
does not preclude a finding that the Claimant is entitled to a fee under the
contract at issue based upon a refund realized "as a result of the audit
process." As Claimant's counsel notes, as expressed in the contract, the fee is
not a percentage of the refund realized "as a result of the contractor's
negotiations with the utility."
to accept Stony Brook's argument, the Court would also have to conclude that
Stony Brook could deprive claimant of his contingency fee at any point after
claimant discovered an overcharge by simply taking control of communications or
negotiations with LILCO. Under such an interpretation, claimant's fee would be
paid at the whim of Stony Brook."
The party seeking to benefit from this skewered construction is the Defendant:
the one who drafted the contract. Contracts should be interpreted in the manner
giving the most equitable result, rather than slanting the terms so that
"...'one party is at the mercy of the other'...." Metropolitan Life Ins. Co.
v Noble Lowndes International, Inc., 84 NY2d 430, 438 (1994); see,
also, Fleischman v Furgueson, 223 NY 235, 241 (1918).
The Defendant has argued that the October 18, 1994
proposing a modification of the
contract terms, demonstrates that the work at issue in this lawsuit was outside
the scope of the contract. First, a 1994 letter is not probative of the
parties' intent upon entry into a contract almost a year earlier, especially,
where as here, the court has indicated that extrinsic evidence is unnecessary to
aid in interpreting any perceived ambiguity. Second, the letter reads
prospectively: what is proposed is a change in the "future savings" exclusion
portion of the contract, not at issue here.
In viewing the uncontroverted material facts necessary to such a ruling, it is
clear that the Claimant has more than established its entitlement to summary
judgment on its first cause of action: breach of an express contract. §
3212 Civil Practice Law and Rules. Claimant having established its entitlement
to judgment as a matter of law, it was incumbent upon Defendant to come forward
with evidence that there exists a triable issue of fact. The Defendant has
failed in its burden. No triable issues of fact pertinent to the issue of
breach, given the clear contract terms, have been presented. The only factual
"rebuttal" presented by Defendant was in the Affidavit of Mark Maciulaitis. His
affidavit merely urged one construction of the contract, and confirmed that
Claimant alerted the Defendant to the existence of the alternate rate. All
other factual information - even viewed in the light most favorable to the
Defendant - confirms the additional events amounting to breach described by
Claimant in his Verified Claim, and supported by the evidence. Claimant is
hereby granted Summary Judgment on the first cause of action: breach of express
There are two remaining causes of action in the Claim: one for breach of an
implied contract, and one sounding in quantum meruit. These claims,
however, are dismissed as a matter of law. The Court has determined that the
Claimant may recover for the Defendant's breach of an express contract.
Accordingly, Claimant is precluded from recovering under its alternate theories.
See, Unisys Corp. v Hercules, Inc., 224 AD2d 365, 367 (1st Dept.
Finally, the amount of damages warranted is not clearly established on this
record. Accordingly, trial on the issue of damages will commence on March 18,
2002, and continue as required thereafter. The parties are instructed to
furnish the court with pre-trial memoranda of law on the issue of damages on or
before March 13, 2002.
February 1, 2002
Plains, New York
HON. THOMAS H. SCUCCIMARRA
Judge of the Court of
Exhibit "4" Affirmation in Support of Motions
of Frederick J. Anton; Exhibit "A", Affidavit in Support of Cross Motion of Mark
Maciulaitis, hereafter Agreement.
Affidavit of Cynthia R. Clark, Esq., Page
"A fair reading of the attorney's affirmation,
the hospital records and the defendant's deposition testimony compel the
conclusion that no material triable issues of fact exist as to the claims of
malpractice asserted against the defendant in the amended complaint as amplified
by the bill of particulars. The fact that defendant's supporting proof was
placed before the court by way of an attorney's affirmation annexing deposition
testimony and other proof, rather than affidavits of fact on personal knowledge,
is not fatal to the motion...(citations omitted
The case cited by Claimant, concerning
enforcement of a stipulation of settlement in a divorce case, is fairly unique
for its reference to the use of a verified pleading in lieu of an affidavit in
of a motion for summary judgment. Hunter v Annexstein
AD2d 449,453 (1st Dept. 1988). Use of a verified pleading as responsive
affidavit has been more widely countenanced, provided it sets forth sufficient
evidentiary facts. See, e.g.
, Travis v Allstate Insurance Company
280 AD2d 394,395 (1st Dept. 2001); But, c.f.
, Pollnow v Poughkeepsie
., 67 NY2d 778,780 (1986) (in defamation action, complaint
verified by infant plaintiff's mother, who did not have personal knowledge,
insufficient to oppose motion for summary judgment and raise issue of fact as to
);Bethlehem Steel Corp. v Solow
, 51 NY2d 870 (1980)
(Defendants failed to show triable issue of fact. "Although defendants'
verified answer may be used as an affidavit...that does not help
defendants in this case for the answer sets forth no evidentiary
."); Riverhead Building Supply, Corp. v Regine Starr
., 249 AD2d 532, 533 (2d Dept. 1998) (Defendant's verified answer
"...contained vague and generalized assertions regarding the quality of building
materials supplied by the plaintiff and the adequacy of payments made by the
defendants, it was patently inadequate to defeat the plaintiff's motion..." for
summary judgment in suit by seller for goods bought and sold); Ostrowski
v State of New York
, 186 Misc 2d 890, 895 (NY Ct Cl 2001) (Summary
judgment granted to non-m
oving Claimant, since "...the facts alleged in the
claim...are not controverted, and the ministerial neglect of the court clerk is
established through the pleadings, and liability by the defendant is
, 58 NY Jur 2d Evidence and
Witnesses § 564 (2000), as to the parol evidence rule generally.
Exhibit "1", Affirmation in Support by
Frederick J. Anton; Exhibit A-2, Affidavit of Mark Maciulaitis, Par. I.1, Page
., Par. I.2, Page
., Par. III, Page
, Par. IV.1 through IV.1.2,
, Par. IV.2, Page
, Par. V.1, Page
Described in the letter as "A review of
historic utility invoices for the purpose of documenting errors in order to
recover overpayments made to the utility."
Examination Before Trial of Arthur Ammann,
Page 119. The deposition testimony indicates that the percentage to be offered
was "one or two percent." See, also
Before Trial of Kirstine Nogiewich, Pages124-125.
Examination Before Trial of Kirstine
Nogiewich, Pages124-125. Her testimony was: "...[Mr. Ammann]
informed...[Claimant] that the university might seek to do the negotiation with
LILCO and that since that was outside of the scope of the contract, we would
like to negotiate a lower rate....The university's negotiation directly with the
utility provider....[was outside the scope of the contract]....[T]he contract
said that the rate that was - that we would pay the contractor included
negotiation, and since the university was going to do it, then the rate - we
would offer them a lower rate...."
An April 19, 1995 e-mail memorandum from
Arthur Ammann to Michael DeMartis states: "This morning Kriss Nogiewich and I
met with David Price...to discuss a reduction in their rate for the potential
LILCO refund. I explained to David Price that since it now appears the
University will have to pursue the refund it was our position that this
transaction falls outside the scope of our contract. Mr. Price did not agree
with this logic and felt that he is entitled to the full commission....His
position is that his firm has spent a great deal of time auditing our bills
which resulted in identifying this potential refund. He is more than willing to
pursue this further with both LILCO and the PSC and feels confident that he will
obtain a refund for us. The suggestion that the University pursue negotiations
with LILCO was made on the basis that it might be more expeditious if higher
level administrators from Stony Brook approached LILCO directly and not because
of...[Claimant's] reluctance or inability to pursue this further...." [Exhibit
"19", Affirmation in Support of Motion of Frederick J. Anton].
Examinations Before Trial of Enrico Johnson
(page 110); Mark Maciulaitis (pages 61-63); Kirstine Nogiewich (pages 124-125);
Gerianne Sands (pages 65, 114, 116-118)].
 See, Also
, Exhibit "19",
, and Exhibit "20", an e-mail memorandum from Harry Snoreck, Vice
President, dated May 2, 1995, directed to Michael DeMartis, Arthur Ammann, and
Kriss Nogiewich: "...We have decided to go with the alternative suggested in
Gerianne's [Sands, Esq.] All-In-1 of April 20. Please notify the...[claimant]
that because we are pursuing recovery through our own efforts, we do not
consider this to be covered under the contract and that they will have to
proceed as necessary if they feel we are not in compliance with the contract.
Please let me know when you do this, and have Gerianne review your letter of
Examination Before Trial of Arthur Ammann,
Pages 13-14; see also, Examination Before Trial of Kirstine Nogiewich, Page
Examination Before Trial of Enrico
Johnson, Pages 11, 23.
Examination Before Trial of Carl E. Hanes,
Jr., Pages 25-26,30-33.
Exhibit "4", Affirmation in Support of
Motion of Frederick J. Anton; Exhibit "A", Affidavit in Support of Cross Motion
of Mark Maciulaitis; hereafter Agreement.
Exhibit "1", Affirmation in Support of
Motion of Frederick J. Anton; Exhibit A-2, Affidavit in Support of Cross-motion
of Mark Maciulaitis, hereafter Bid Proposal, Par.I.2, Page 00005.
Agreement, Par. 2.; Bid Proposal, Par.
I.2, Page 00005.
Bid Proposal , Par. I.1 (a), Page
Bid Proposal, Par. III, Page 00008.
Bid Proposal, Par. V.1, Page 00012.
Agreement, "Whereas.." clause; Bid
Proposal, Par. I.1; I.2; III(d), Pages 00004-00005, 00008.
Claimant's Memorandum of Law in Support of
Motion, Page 40.