HON. GEOFFREY J. O CONNELL Justice. Plaintiff(s), Defendant(s). MOTION SEQ. No. 1

Transcription

1 SHORT FORM ORDER Present: SUPREME COURT - STATE OF NEW YORK HON. GEOFFREY J. O CONNELL Justice ROBERT J. ACHTZIGER, -against- Plaintiff(s), TRIAL/IAS, PART 10 NASSAU COUNTY INDEX No. 6442/O 1 CHAMPION MOTOR GROUP, INC. and MICHAEL TODD and KEITH SHELDON, MOTION DATE: 4/25/02 Defendant(s). MOTION SEQ. No. 1 The following papers read on this motion: Notice of Motion/Affidavit/Memorandum of Law/Exhibits A-W Affidavit in Opposition/Memorandum of Law/Exhibits A-TT Reply Affirmation Plaintiff seeks an Order pursuant to CPLR to determine damages on his first, second, third, fourth and the portion of the fifth cause of action which seeks punitive damages (e) granting him partial summary judgment with respect to liability on his first, second, third and fourth causes of action. He also seeks an award of damages to him in the amount of $20, on his fifth cause of action and setting this matter down for an Inquest Plaintiff seeks to recover damages for defendants alleged breach of contract and fraud. He alleges that on or about September 11, 2000, he met with defendants MICHAEL TODD, a 35% shareholder at defendant CHAMPION MOTOR GROUP, INC., and defendant KEITH SHELDON, a CHAMPION MOTOR salesman. He claims that they reached an agreement whereby plaintiff agreed to advance $165, to CHAMPION MOTOR to purchase a 200 Z-8 BMW automobile from Germany, and CHAMPION MOTOR

2 Achtziger v. Champion Motor Grouu. Inc. agreed to sell the car at a price of at least $175, After deducting a $ fee due CHAMPION MOTOR and other costs, the profits were to be equally shared, i.e., 50% to plaintiff and 50% to CHAMPION MOTOR. Plaintiff alleges that the automobile was to comply with all United States Department of Transportation ( DOT ) and Environmental Protection Agency ( EPA ) standards when delivered in the United States. Plaintiff further alleges that the parties agreed that the car would arrive within 45 days and be sold approximately 45 days later. Plaintiff claims that although he paid CHAMPION MOTOR $165, for the car, it paid Technology Financial Services, AG, only $145, Moreover, on September 22,2000, when delivered, the car had not yet been converted to meet United States to perform the necessary conversion of the vehicle. They claim ETLI failed to perform, and the car ultimately had to be shipped to Florida to be made ready for sale in the United States. Defendants allege that they were unable to get the car in sales condition until May, 2001, at which time the requisite marketing efforts were made. The parties in fact entered into a written agreement on September 20,200O. This Promissory Note and Agreement, provides that plaintiff agreed to pay $165, for value received - a 2000 BMW Z-8. It further provides that the vehicle is actually the property of plaintiff and was only consigned to CHAMPION,MOTOR for the purpose of a retail sale to a third party for at least that plaintiff shall take possession of the agreement specifically states [i]t is understood that the vehicle has been imported from Germany and will require EPA/DOT modification and it is expected that this process will take 45 days standards. The ensuing delay resulted in the car not being ready for sale until May, 200 1, and the defendants did not undertake to advertise the car until it was ultimately received in May, The market for foreign sports cars apparently crashed in the interim. The car has yet to be sold. Defendants allege that it contracted with a third-party, Environmental Testing of Long Island ( ETLP ), $175, The Agreement also stated original Manufacturers Certificate of Origin or any original title; and, that any such document shall remain in the possession of plaintiff until -the retail sale of the vehicle. from the date of payment and only upon these approvals will said vehicle appear in the showroom for actual retail sale. It is estimated The 2._

3 Achtziger v. Champion Motor Group, Inc. that the above vehicle will be sold within 90 days of execution of this agreement. Defendant CHAMPION MOTOR specifically agreed to use their best efforts to market said vehicle via print ads. The written agreement is signed by plaintiff; MICHAEL TODD, personally; KEITH SHELDON, personally; and, MICHAEL TODD on behalf of CHAMPION MOTOR. In his Complaint, in his first cause of action, plaintiff alleges that defendants breached the contract by failing to procure the car suitable for sale on its showroom floor within 45 days as agreed. In his second cause of action, plaintiff alleges that defendants breached the contract by not exercising their best efforts to advertise and market the car. The third cause of action contends that defendants breached the contract by procuring a car which did not meet United States standards when delivered. The fourth cause of action seeks attorney s fees pursuant to the written agreement. Lastly, in his fifth cause of action, plaintiff alleges fraud in that defendants represented the car s cost to be $165, and billed him accordingly, but defendants actually paid only $145, for the car. Plaintiff presently seeks partial summary judgment with respect to liability on is first, second, third and fourth causes of action; judgment in the amount of $20, on his fifth cause of action; and, an inquest on damages, including punitive damages as sought in the fifth cause of action. As for the first cause of action, plaintiff has not only established that the car did not meet EPA/DOT standards within 45 days of his payment, he has also established that the defendants were unacceptably lax in their efforts to meet this contractual obligation. The car inexplicably sat at ETLI for over five months before it was shipped to U.S. Conformance in Jupiter, Florida, on March 8,200 1, where it was to be modified to comply with United States requirements. Not until nearly two months later on May 3,200 1, did defendant CHAMPION MOT0RpayU.S. Conformance for its services to procure the car to summary judgment with respect to liability on his first cause of action. As for plaintiffs second cause of action, AD2d 8 63 (2nd Dept. 1988); Mecca Lounge, Inc. v Misak, 94 s release. Plaintiff is entitled when called upon to construe a clause in a contract expressly providing that a party is to apply his best efforts, a clear set of guidelines against which to measure a party s best efforts is essential to the enforcement of such a clause (citations omitted).... Bernstein v Felske, 143 AD2d 761 (2 d Dept. 1983); Strauss Paper Co., 3

4 Achtziaer v. Champion Motor Group, Inc. Inc. v. (RSA Executive Search, Inc., 260 AD2d 570 (2 d Dept. 1999). Here, best efforts is sufficiently defined: Print ads were required. Moreover, the agreement specifically anticipated a sale within 90 days. It was not until May 6,200 1, over seven months after the parties entered into their agreement, that defendant CHAMPION MOTOR first advertised the car. Contrary to defendants contentions, plaintiff has clearly established that industry practice certainly allowed for dealers like defendant CHAMPION MOTOR to advertise vehicles prior to their availability. Defendants inexplicable failure to advertise this car for nearly eight months after it was paid for it by plaintiff, particularly in view of defendants other contractual obligations, also constitutes a breach of contract. Based on the proof presented, plaintiff is awarded summary judgment with respect to liability on its second cause of action. Plaintiffs third cause of action is dismissed. Where there is a conflict between the express provision in a written contract and an alleged oral -agreement, the oral agreement is unenforceable. Shah v Micro Connections, Inc., 286 AD2d 433 (2 d Dept. 2001); Braten v Bakers Trust Co., 60 NY2d 155 (1983); Citibank, N.A. v Pullman, 190 AD2d 839 (2 d Dept. 1993). Plaintiffs claim that defendants agreed to import the car ready for sale in the United States clearly conflicts with the parties written agreement and is accordingly unenforceable. As for plaintiffs fifth cause of action, there are questions of fact precluding summary judgment. Defendants contend that to the extent a kickback of $20, of the purchase price may have occurred, it was an unknown bonus which Technology Financial Services, AG, decided to give them after the sale was completely consummated. However, insofar as plaintiff seeks punitive damages in his fifth cause of action, that claim is dismissed. Not only is there no injury to the public, the requisite wanton conduct is clearly absent. Rocanova v Equitable Life Assur. Sot. of U.S., 83 NY2d 603 (1994); A. Resnick Textile Co., Inc. v Daisy Group, Ltd., 284 AD2d 101 (lst Dept. 2001); Steinhardt Group Inc. v Citicorp., 272 AD2d 255 (lst Dept. 2000); Best Payphones, Inc v Empire State Payphone Ass n, 272 AD2d 139 (1 Dept. 2000); Leppard v Parisi, 271 AD2d 412 (2 d Dept. 2000). 4

5 Achtziger v. Chamuion Motor Groun, Inc. Plaintiff is granted summary judgment with respect to liability only on his first, second and fourth causes of action. The third cause of action is dismissed. As for plaintiffs fifth cause of action, issues of fact exist; however, his claim for punitive damages is dismissed. Damages on the first, second and fourth causes of action will be determined at trial. The trial in this matter is scheduled for June 24,2002 at 9:30 a.m. The parties are reminded that the Court requires pretrial submissions and compliance with the Commercial Division Rules. It is, SO ORDERED. Dated: 5