FILED: NEW YORK COUNTY CLERK 04/21/2012 INDEX NO /2010 NYSCEF DOC. NO RECEIVED NYSCEF: 04/21/2012

FILED: NEW YORK COUNTY CLERK 04/21/2012 INDEX NO. 651193/2010 NYSCEF DOC. NO. 12-19 RECEIVED NYSCEF: 04/21/2012 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK ----------------------------------------------------------------------X PHOENIX CONTRACTING GROUP, INC. -against- Plaintiff, WEST END ENTERPRISES, LLC, WEST 60 TH STREET ASSOCIATES, LLC., VJB CONSTRUCTION CORP., WESTCHESTER FIRE INSURANCE COMPANY, Index No. 651193/2010 SESTITO INFISSI USACORP. and JOHN DOE NO. 1 through JOHN DOE No. 100, the names of the last 100 defendants being fictitious, the true defendants being fictitious, the true names of said defendants being unknown to plaintiff, it being intended to designate fee owners, tenants or occupants of the liened premises and/or persons or parties having or claiming an interest in or lien upon the liened premises, if the aforesaid individual defendants are living, and if any of said individual defendants be dead, their heirs at law, next of kin, distributes, representatives, and the assignees, lienors, creditors and successors in interest of them, and generally all persons claiming under, by, through or against said defendants named as a class of any right, title or interest in or lien upon the premises described in the complaint herein, Defendants. -----------------------------------------------------------------------X MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFF S MOTION FOR LEAVE TO FILE THE FIRST AMENDED VERIFIED COMPLAINT LINA C. TANG, ESQ. Attorney for Plaintiff 420 Gulf Street Milford, CT 06460 (203) 340-2898 linactang@aol.com

TABLE OF CONTENTS Page TABLE OF AUTHORITIES.. ii PRELIMINARY STATEMENT..1 POINT I MOTION TO AMEND COMPLAINT SHOULD BE FREELY GRANTED ABSENT PREJUDICE OR SURPRISE RESULTING FROM THE DELAY...2 POINT II PLAINTIFF MUST SUFFICIENTLY PLEAD CAUSES OF ACTION IN ITS PROPOSED AMENDED VERIFIED COMPLAINT..3 POINT III PLAINTIFF HAS PLEAD A CAUSE OF ACTION IN FRAUDULEN T MISREPRESENTATION 4 POINT IV PLAINTIFF MAY SEEK PUNITIVE DAMAGES 5 POINT V PLAINITFF HAS PLEAD A CAUSE OF ACTION FOR BREACH OF IMPLIED COVENANT OF GOOD FAITH AGAINST OWNERSHIP AND VJB 5 POINT VI PLAINTIFF IS ENTITLED TO DELAY DAMAGES..10 CONCLUSION.12 i

TABLE OF AUTHORITIES Cases Pages Valdes v. Marbrose Realty, Inc. 289A.D.2d 28, 734 N.Y.S.2d 24 (1 st Dept.2001) 2 Tishman Construction Corp. of New York v. The City of NewYork 280 A.D.2d 374, 377, 720N.Y.S.2d 487 (1 st Dept.2001)..2, 4 McCaskey, Davies and Assoc. v New York City Health & Hospital Corporation 59 NY2d 755, 463 NYS2d 434 (1983)..2 Whalen v. Kawaski Motors Corp., U.S.A., 92 N.Y.2d 288, 293 (1988) 2 Swersky v. Dreyer-Traub, 219 A.D.2d 321, 326, 643 N.Y.S.2d 33 (1 st Dept. 1996) 4, 5 Mitchell Maxwell & Jackson, Inc. v. US Realty and Investment Company, et al, 2010 Slip Op. 31901 [Sup. Ct. 2010]).4 Foley v D Agostino, 21 A.D.2d 60, 64 (1 st Dept. 1964) 4 Pludeman v Northern Leasing Systems, Inc. 40 A.D.3d 366, 837 N.Y.S.2d 10 (1 st Dept. 2007) 4 Dalton v. Educational Testing Service 87 N.Y.2d 384, 389, 639 N.Y.S.2d 977 (1995) 6 Kalisch-Jarcho, Inc. v. City of New York 58 N.Y.2d 377, 461 N.Y.S.2d 746 (1983) 6 ABAX Incorporated v. New York City Housing Authority 282 AD2d 372, 373 (1 st Dept. 2001) 11 Corinno Civetta Construction Corp. v City of New York 67 NY2d 297 (1986) 11 Statutes Pages CPLR 3025(b) 2 CPLR 3016(b) 4 ii

PRELIMINARY STATEMENT Plaintiff should be given leave to file the First Amended Verified Complaint as annexed to the moving papers. This action arises out of a construction project known as 60-61 st Street whereas three buildings were being constructed, one for condominiums and the remaining two for rental (hereinafter Project ). Plaintiff was hired to install curtain wall, window wall, punch window, terrace doors, bulkheads and metal panel on the Project that was manufactured by Sestito Infissi SNC/Sestito Infissi USA Corp. (hereinafter window material ) by VJB Construction Corp. (hereinafter VJB ), the Construction Manager as agent for West End Enterprises, LLC (hereinafter West End ) and West 60 th Street Associates, LLC (hereinafter West 60 th ), the owners of the Project. Prior to Phoenix being hired, West 60 th and West End (collectively hereinafter Ownership ) and VJB had terminated the previous installer Technal Associates Inc. (hereinafter Technal ) for failure to install the curtain wall, window wall, punch window, terrace doors, bulkheads and metal panel manufactured by Sestito Infissi SNC/Sestito Infissi USA Corp. (hereinafter Sestito ). Prior to Phoenix entering into its Subcontract with Ownership and VJB, Technal had assigned all its rights in the window material to Ownership. At the time Phoenix commenced working Ownership owned the window material. Plaintiff commenced this action to foreclose on a mechanic s lien on the condominium units and for breach of contract. Prior to this, the suppliers to the electrical contractor commenced the action Midtown Electric Supply Corp. v. Sage Electrical Contracting, Inc. et al, Index No. 650764/09 (hereinafter Midtown action ) to foreclose on its mechanic s lien which it had placed on one of the rental buildings in the Project, naming West 60 th, VJB, Phoenix and Sestito Infissi USA Corp. (hereinafter Sestito USA) as defendants. West 60 th settled with plaintiffs in the Midtown action thereby rendering the causes of action against Phoenix and Sestito USA moot. After Phoenix had commenced the instant action against Ownership, VJB and Westchester Fire Insurance Company (hereinafter Westchester ) Ownership, VJB and Westchester counterclaimed against Phoenix. In the Midtown action, West 60 th cross claimed against Sestito USA after Sestito USA cross claimed against it. West 60 th then cross claimed against Phoenix eventhough Phoenix had not answered or appeared in the Midtown action. Phoenix then cross claimed against West 60 th and Sestito USA. West 60 th then moved to have the 1

cross claims between Phoenix, West 60 th and Sestito USA severed from the Midtown action and then consolidated with this instant action. The motion was granted as per stipulation amongst the parties. None of the parties in this action will be prejudiced as little to no discovery has been done on either the instant action or the Midtown action. Since the discovery stage of this action has barely begun, each defendant will have ample opportunity to demand discovery on Phoenix s additional claims. Phoenix s new causes of action are properly plead, have merit and plaintiff should be granted leave to file the First Amended Verified Complaint. LEGAL ANALYSIS POINT I MOTION TO AMEND COMPLAINT SHOULD BE FREELY GRANTED ABSENT PREJUDICE OR SURPRISE RESULTING FROM THE DELAY It is well settled law that leave to amend pleadings should be freely granted absent prejudice or surprise resulting from the delay (CPLR 3025[b]; Valdes v. Marbrose Realty,Inc., 289A.D.2d 28, 29, 734 N..S.2d 24 [1 st Dept.2001]; Tishman Construction Corp. of New York v. The City of NewYork, 280 A.D.2d 374, 377, 720N.Y.S.2d 487 [1 st Dept.2001]; McCaskey, Davies and Assoc. v New York City Health & Hospital Corporation, 59 NY2d 755, 463 NYS2d 434 [1983]). Prejudice arises when a party incurs a change in position or is hindered in the preparation of its case or has been prevented from taking some measure in support of its position, and these problems might have been avoided had the original pleading contained the proposed amendment. (Valdes v. Marbrose Realty, Inc. v. The City of New York, supra at 29; see also, Whalen v. Kawaski Motors Corp., U.S.A., 92 N.Y.2d 288, 293 [1988]). In the instant case, none of the answering defendants would be prejudiced by the Court granting leave to amend the complaint as annexed hereto as Exhibit R. As set forth in detail in the Tang affirmation dated March 4, 2012, almost no discovery has been responded to and defendants have ample opportunity to obtain discovery regarding such additional claims. 2

As the First and Second Causes of Actions have already been plead either in Phoenix s Verified Complaint in the instant action or in Phoenix s Verified Answer to Defendant West 60 th Street Associates, LLC s Cross-Claims Against West 60 th Street Associates, LLC and Sestito Infissi USA Corp. (hereinafter Phoenix s Cross-Claims), these causes of action should not be at issue. (See Tang Affirmation dated March 4, 2012). As to the Fifth Cause of Action in the Proposed First Amended Verified Complaint, the same cause of action was plead in both Phoenix s Verified Complaint and Phoenix s Cross- Claims and only differs in that the damages amount has been adjusted. This cause of action should not be at issue. (See Tang Affirmation dated March 4, 2012). As to the Eleventh Cause of Action, substantially the same cause of action was plead in Phoenix s Cross-Claims, except the damages amount has been adjusted and VJB the Construction Manager has been added as an additional defendant in that cause of action. (See Tang Affirmation dated March 4, 2012) VJB has more than ample opportunity to address this claim in the upcoming discovery so it will not be prejudiced by it. As to the Twelfth Cause of Action, Phoenix previously plead this cause of action in Phoenix s Cross-Claims against Sestito USA, but has simply added additional detail as to the claims and adjusted the amount claimed for damages. (See, Tang Affirmation dated March 4, 2012). Since little discovery has taken place, defendants have ample opportunity to explore the claim plead. This should not be an issue. As to the Thirteenth Cause of Action, Phoenix previously plead this cause of action in Phoenix s Cross-Claims and it is substantially the same. (See, Tang Affirmation dated March 4, 2012). This should not be an issue. Therefore, leave should be granted as to the First, Second, Fifth, Eleventh, Twelfth and Thirteenth causes of action as they have already been plead previously. POINT II PLAINTIFF MUST SUFFICIENTLY PLEAD CAUSES OF ACTION IN ITS PROPOSED FIRST AMENDED VERIFIED COMPLAINT 3

In granting leave to amend pleadings, the First Department requires that the moving party state a cause of action in the amended pleadings. (See, Tishman Construction Corp. of New York v the City of New York, 280 A.D.2d 374, 720 N.Y.S.2d 487 [1 st Dept. 2001]). In the case at bar, Phoenix has sufficiently plead causes of actions in those causes of action that have not previously been plead. Each new cause of action will be addressed individually. POINT III PLAINTIFF HAS PLEAD A CAUSE OF ACTION IN FRAUDULENT MISREPRESENTATION The elements of fraudulent misrepresentation are: (1) the defendant must have made a material misrepresentation; (2) the defendant must have intended to defraud the plaintiff; (3) the plaintiff reasonably relied on such material misrepresentations; and (4) as a result of said material misrepresentations, plaintiff was damaged. (Swersky v. Dreyer-Traub, 219 A.D.2d 321, 326, 643 N.Y.S.2d 33 [1 st Dept. 1996]; Mitchell Maxwell & Jackson, Inc. v. US Realty and Investment Company, et al, 2010 Slip Op. 31901 [Sup. Ct. 2010]). CPLR 3016(b) requires specificity in pleadings for material misrepresentation (Mitchell Maxwell & Jackson, Inc., supra). However, Courts have held that this additional requirement of specificity is met when the pleadings are plead with sufficient detail so as to give adequate notice of the transactions and occurrences constituting the wrong. (Foley v D Agostino, 21 A.D.2d 60, 64 [1 st Dept. 1964]; Mitchell Maxwell & Jackson, Inc., supra) In fact, Courts have held that CPLR 3016(b) may be met when the facts are sufficient to permit a reasonable inference of the alleged conduct (Mitchell Maxwell & Jackson, Inc., supra; Pludeman v Northern Leasing Systems, Inc., 40 A.D.3d 366, 837 N.Y.S.2d 10 [1 st Dept. 2007]). In the case at bar, plaintiff has clearly met its burden with respect to the Third Cause of Action as plead in the Proposed First Amended Verified Complaint (Exhibit R ). Plaintiff has plead that VJB/Ownership misrepresented the scope of work that had to be done on the Project for the price and that such misrepresentation was material. Plaintiff has also plead that VJB/Ownership intended to defraud plaintiff so as to prevent VJB/Ownership from having to pay a price higher than the amount remaining in Technal s contract. Plaintiff has plead that it 4

relied on VJB/Ownership s representation of the remaining work on the job when it agreed to complete the balance of the work on the project for the amount remaining on Technal s contract because VJB/Ownership would have knowledge of the amount of work remaining to complete the work contracted under Technal s contract and VJB/Ownership prevented Phoenix from reviewing the site itself by requesting that the meeting be held after the site was closed. Phoenix has plead that such reliance is reasonable. Phoenix has also plead that it has been damaged by the fraudulent misrepresentation since it incurred substantial additional labor costs that it would not have if not for the material misrepresentation of the scope of work. Plaintiff s Third Cause of Action of the proposed First Amended Verified complaint clearly notifies VJB/Ownership of the transactions and occurrences that constitute the wrongs complained of. Therefore, Phoenix has plead a cause of action in fraudulent misrepresentation and the plaintiff requests leave to include the Third Cause of Action in its First Amended Verified Complaint. POINT IV PLAINTIFF MAY SEEK PUNITIVE DAMAGES Plaintiff may seek punitive damages in a tort action where the wrongdoing is intentional or deliberate, has circumstances of aggravation or outrage, has a fraudulent or evil motive, or is in such conscious disregard of the rights of another that it is deemed willful and wanton. (Swersky v Dreyer & Traub, supra at 328) In the case at bar, plaintiff has plead that the wrongdoing (fraudulent misrepresentation of the amount of work that needed to be done on the subcontract) was intentional and deliberate, with a fraudulent motive and was in conscious disregard of the rights of Phoenix. Therefore, Phoenix has plead a sufficient cause of action for punitive damages in the Fourth Cause of Action of the proposed First Amended Verified Complaint and the plaintiff requests leave to include the Fourth Cause of Action in its First Amended Verified Complaint. POINT V PLAINTIFF HAS PLEAD CAUSES OF ACTION FOR BREACH OF 5

IMPLIED COVENANT OF GOOD FAITH AGAINST OWNERSHIP AND VJB It is well settled law that there is an implied covenant of good faith and fair dealing in the contract performance of every contract (Dalton v. Educational Testing Service, 87 N.Y.2d 384, 389, 639 N.Y.S.2d 977 [1995]; Kalisch-Jarcho, Inc. v. City of New York, 58 N.Y.2d 377, 461 N.Y.S.2d 746 [1983].) The Courts have held that the implied covenant of good faith and fair dealing also applies to construction contracts (Kalisch-Jarcho, Inc. v. City of New York, supra 384.) In the case at bar, the Sixth, Seventh, Eighth, Ninth and Tenth causes of action, Phoenix has plead causes of action for breach of the implied covenant of good faith. Included within the implied covenant of good faith is any promise which a reasonable person in the position of the promisee would be justified in understanding was included; and embraces a pledge that neither party shall do anything that would have the effect of destroying or injuring the right of the other party to receive the fruits of the contract. (Dalton v Educational Testing Service, supra 389.) In the case at bar, as stated in the subcontract, Phoenix had a labor only contract since the window material was already owned by Ownership by virtue of an assignment by the previous installer of the production contract (see, Tang Affirmation dated March 4, 2012 and Subcontract annexed hereto as Exhibit Q ). Implicit in a labor only contract is the promise that the window material will be delivered to the jobsite as per specifications, approved shop drawings in enough time so that Phoenix will be able to install the window material by any deadlines set forth in the Subcontract (if there are any) and in the manner as set forth by the Subcontract without paying any additional funds for product, performing any additional labor outside its scope and purchasing material. Failure of Ownership to ensure this would have the effect of destroying or injuring Phoenix s right to be paid the full contract price less the expected labor costs (profit). Also implicit in any construction subcontract is that site conditions on the Project will be as per specifications and approved shop drawings and that if field corrections had to be made, 6

Construction Manager/Ownership would do so expeditiously so as to not delay the installation by the Subcontractor. Also implicit in any construction Subcontract is that the Construction Manager would not repeatedly lie about field conditions being corrected so that the Subcontractor would have to continuously send crews to the same locations, find that the conditions were not fixed and then have to demobilize and remobilize elsewhere wasting valuable time and labor. A. Sixth Cause of Action Phoenix has plead a cause of action against Ownership and VJB for breach of the implied covenant of good faith in failing to provide the product as per specifications and approved shop drawings, in complete floors, in a timely fashion. (i) Phoenix has plead that it was directed by both Sestito and VJB/Ownership to pay for delinquent shipping and trucking bills first in order to obtain window material that was being held for overdue bills and that it was supposed to be reimbursed by Sestito. VJB/Ownership directed Phoenix to backcharge Sestito for these monies. (ii) Phoenix has plead that it had to pay for some of the current shipping and trucking costs at the direction of both Sestito and Ownership/VJB. Sestito indicated it would reimburse Phoenix and Ownership/VJB directed Phoenix to backcharge Sestito for these monies. (iii) Phoenix has plead that it did not have any legal obligation to pay for any shipping and trucking costs since the product was already owned by Ownership and it was a labor only contract. Requiring Phoenix to pay for these expenses when it had no legal obligation to do so, just so it would have window material to install, is bad faith on the part of Ownership/VJB. (iv) Phoenix has plead that it was damaged in that it lost profit from installation of the bulkhead in the A building which was descoped from Phoenix because the window material was late. Phoenix has also plead that the late delivery of the window material by Sestito and Ownership constituted bad faith since it prevented Phoenix from earning its expected profit (v) Phoenix has plead that it was damaged in that it lost profit from installation of the bulkhead in the C building because the field conditions did not match the approved shop 7

drawings and VJB/Ownership elected to change the bulkhead to brick. Phoenix has also plead that this constituted bad faith since it prevented Phoenix from earning its expected profit. (vi) Phoenix also plead that implied in the Subcontract was that the window material would be supplied in complete floors since Phoenix was contracted to install the windows horizontally, not vertically. Sestito and VJB/Ownership s failure to provide the floors complete constituted bad faith as it was implicit that the window material would be provided in a manner consistent with allowing Phoenix to install windows on a horizontal basis. By failing to do this, caused Phoenix to have an increase in labor costs and a decrease in expected profit. (vii) Phoenix also plead implied in the Subcontract was that the window material provided for installation would be properly made and not requiring additional work to make it installable as per approved shop drawings and specifications. As a result of this, Phoenix had to order materials and perform additional labor to make the product installable. This caused Phoenix a decrease in its expected profit. VJB/Ownership demanding Phoenix do this extra work and purchase the additional material constituted bad faith since Phoenix had no legal obligation to do so. (viii) Phoenix also plead that VJB/Ownership required Phoenix to do additional labor that was the responsibility of the manufacturer for field testing. Since the window material belonged to Ownership it was bad faith to require Phoenix to do this additional work instead of having their own people adjust it. This caused Phoenix a decrease in its expected profit. (ix) Phoenix has plead that VJB/Ownership would repeatedly demand that Phoenix incur expenses to get the window material to the jobsite and perform additional work and material to rehabilitate the window material when it was not legally obligated to do so and to backcharge Sestito. VJB/Ownership would then pay Sestito by joint check so as to prevent Phoenix from backcharging Sestito. VJB/Ownership also failed to pay Sestito for the last approximately $800,000.00 from which Phoenix would have been able to obtain payment of its backcharges from Sestito. VJB/Ownership s demands and failures resulted in Phoenix losing any of its expected profit on the job. VJB/Ownership s requiring Phoenix to incur substantial expenses it was not legally obligated to do in order to get the window material installed and then 8

putting Phoenix in a position whereas it could not recoup this money constitutes bad faith as it prevented Phoenix from collecting any of the expected profit on the Project. (x) In the Sixth Cause of Action, Phoenix has properly plead a cause of action for breach of the implied covenant of good faith against VJB/Ownership. B. Seventh Cause of Action Phoenix has plead that implied in the Subcontract is that the Construction Manager/Ownership will allow the Subcontractor open access to its workspace and not block off access by piles of other trades supplies and steel studs and drywall. By scheduling other trades to be on the floors at the same time or before Phoenix, hindered and interfered with Phoenix s ability to move the window material around the floor for storage, shake out and installation and caused Phoenix to pay substantial additional labor costs to move the windows by hand, often having to lift each window over piles of other trades supplies. Accordingly, this behavior caused Phoenix to expend substantial amounts more than budgeted for to move the windows around the floors and expected profit dropped. Phoenix has properly plead a cause of action for breach of the implied covenant of good faith. C. Eighth Cause of Action It was a breach of the Subcontract when VJB/Ownership failed to pay Phoenix its retainage when the work was completed (scope of work less descoped labor and materials). Phoenix had plead that implicit in the Subcontract is that VJB/Ownership will not demand that Phoenix do additional out of scope work free of charge in order to get paid the balance of monies due under the contract and then after Phoenix does the additional work upon promise of said funds being paid within two weeks of completion of the additional work, and then not pay it. Phoenix plead that VJB/Ownership advised Phoenix that it would not pay Phoenix its retainage unless it corrected all the conditions on the remaining punch list eventhough it was outside of Phoenix s scope of work. Phoenix then plead it was bad faith for VJB/Ownership to not pay Phoenix after Phoenix corrected all the damage by others punch list when doing the work for free was contingent on Phoenix being paid its retainage within two weeks of Phoenix fixing the damage by others. All of these have the effect of destroying Phoenix s ability to recover its full Subcontract price less descoped items and retainage on the Subcontract. Phoenix properly plead a cause of action for breach of the implied covenant of good faith. 9

D. Tenth Cause of Action Phoenix plead that Ownership and Phoenix had come up with an agreement that since window material on the hoist runs of the C building would not be ready to be installed for quite some time and the C building bulkhead was being replaced with brick that the bulk head at the C building and the installation of the hoist runs would be descoped from Phoenix and Phoenix would be paid its money less the descoped amounts. Phoenix plead that after Phoenix had done additional work and demobilized off the site at the direction of VJB that Ownership refused to sign the change order. It was plead that it was implicit in the Subcontract that if Ownership was not agreeing to descope the hoist runs installation and VJB/Ownership demanded Phoenix demobilize off the site that Ownership/VJB would contact Phoenix when the hoist runs were being taken down so Phoenix could remobilize to install the window material. Phoenix has plead that they were never contacted by Ownership/VJB to return to install the hoist runs. By failing to do this, Ownership destroyed Phoenix s ability to be complete the window installation so as to allow Phoenix to receive their full Subcontract price. Phoenix has properly plead a cause of action for breach of the implied covenant of good faith. E. Ninth Cause of Action Delay VJB and Ownership are to provide a jobsite that will meet approved shop drawings and specifications or they are in breach of the Subcontract. Phoenix has plead that it is implicit in the Subcontract that if the site conditions fail to meet the approved shop drawings and specifications, then VJB/Ownership will do the remedial work necessary to fix the condition and do it in a timely manner so as not to interfere with the Subcontractor s ability to install the window material as per the Subcontract. Phoenix has also plead that implicit in the Subcontract is that VJB/Ownership will not lie to the Subcontractor on a regular basis claiming that the corrective work was done when it in fact was not done resulting in substantial lost man hours in demobilizing and remobilizing to multiple locations, that would not have happened if VJB/Ownership had not lied. As a result of the foregoing, VJB/Ownership destroyed Phoenix s opportunity to make this a profitable job as expected when the Subcontract was signed. Phoenix has plead this is a breach of the implied covenant of good faith. Accordingly, the Sixth, Seventh, Eighth, Ninth and Tenth Causes of action plead a breach of implied covenant of good faith and the Court should grant leave for Phoenix to include the 10

Sixth, Seventh, Eighth, Ninth and Tenth causes of action in its First Amended Verified Complaint. POINT VI PLAINTIFF IS ENTITLED TO DELAY DAMAGES Exculpatory clauses in construction contracts may not be used to bar damages for (1) delays caused by the protected party s bad faith or its willful, malicious or grossly negligent conduct; (2) uncontemplated delays; (3) delays so unreasonable that they constitute an intentional abandonment of the contract by the contractee; and (4) delays resulting from the contractee s breach of a fundamental obligation of the contract. (ABAX Incorporated v. New York City Housing Authority, 282 AD2d 372, 373 [1 st Dept. 2001]; Corinno Civetta Construction Corp. v City of New York, 67 NY2d 297 [1986].) As set forth in Point V, Phoenix s delay damages were caused by VJB/Ownership s bad faith behavior which entitles Phoenix to collect for them. Phoenix s delay damages were also uncontemplated. It was presumed since the previous installer (Technal) was terminated from the Project because it could not get the job done that the site was ready to have the window material installed. Otherwise, Technal was not delaying the job and they would have no basis for terminating Technal s subcontract. It was uncontemplated that the jobsite was not ready well in advance of where Phoenix was supposed to start installing the window material. It was also uncontemplated that Phoenix would be required to have to come back to the same location numerous times over a substantial portion of the project because VJB/Ownership kept on misrepresenting to Phoenix that a location had the remedial work done when it did not. It was uncontemplated that VJB/Ownership would backload the job so as to require Phoenix to have to lift windows over obstructions on most floors. It was never contemplated that VJB/Ownership would demand that Phoenix install window material in rough openings that were not ready and require Phoenix to do additional temporary bracing as a result and to have to return later to readjust the window after the remedial work was done. It was never contemplated that VJB/Ownership would require Phoenix to have to pay for shipping and trucking costs it was not required to do in order to obtain the windows to install on the project. It was not contemplated 11

,------- that VJB/Ownership would continuously tell Phoenix to pay monies for Sestito and to backcharge them and then not to allow them to backcharge them by not paying them over $800,000.00. As a resuit, Phoenix is entitled to coiiect its delay charges since they were a result of bad faith and they were uncontemplated. ~GNCLUSION For the reasons set forth in Plaintiffs Motion for Leave to file the First Amended Verified Complaint, submitted herewith~ and the points of tact and law set torth above~ Plaintiff respectfuliy requests that Plaintiff's motion for leave to file the First Amended Verified Complaint be granted in its entirety and for such other, further and different relief as the Court may deem just and proper. Dated: Milford, CT March 5, 2012?--.---? :?s-- LINA C. TANG, ESQ. Attorney for Plaintiff 420 Gulf Street Milford, CT 06460 (203) 340-2898 linactang@aol com

AFFIRMATION OF SERVICE Lina Tang, Esq., an attorney duly licensed to practice law before the Courts of the State of New York, under the penalties of perjury, hereby affirms and states: I am not a party to this action, am over the age of 18 years of age and reside in the state of Connecticut. On April 14, 2012, I served the within Memorandum oflaw on: Brian Clark Haberly, Esq. Belkin Burden Wenig & Goldman, LLP Attorneys for Defendants West End Enterprises LLC, West 60th Street Associates, LLC, VJB Construction Corp. and Westchester Fire Insurance Company 270 Madison A venue New York, NY 10016 SAM GDANSK!, ESQ. SCOTT GDANSKI, ESQ. Gdanski & Gdanski, LLP Attorneys for Sestito Infissi, USA Corp. 3 Rockwood Lane Suffern, NY 10901 by depositing a true copy of the same, enclosed in a postage paid, properly addressed wrapper, Express mail in an official depository of the United States Postal Service in the State of Connecticut. Dated: Milford, Connecticut April14, 2012 13

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USPS.com - Track & Confirm https://tools.usps.com/go/trackconfirmaction?qtc_tlabels1=ei369607751us Page 1 of 1 4/20/2012 English Customer Service USPS Mobile Register / Sign In Search USPS.com or Track Packages Quick Tools Ship a Package Send Mail Manage Your Mail Shop Business Solutions Track & Confirm GET EMAIL UPDATES PRINT DETAILS YOUR LABEL NUMBER SERVICE STATUS OF YOUR ITEM DATE & TIME LOCATION FEATURES EI369607751US Express Mail Delivered April 16, 2012, 10:25 am SUFFERN, NY 10901 Guaranteed By: April 16, 2012, 3:00 PM Proof of Delivery Arrival at Post Office April 16, 2012, 8:06 am SUFFERN, NY 10901 Depart USPS Sort Facility Processed through USPS Sort Facility Dispatched to Sort Facility April 14, 2012 HARTFORD, CT 06199 April 14, 2012, 7:07 pm HARTFORD, CT 06199 April 14, 2012, 6:17 pm MILFORD, CT 06460 Acceptance April 14, 2012, 12:01 pm MILFORD, CT 06460 Check on Another Item What's your label (or receipt) number? Find LEGAL ON USPS.COM ON ABOUT.USPS.COM OTHER USPS SITES Privacy Policy Terms of Use FOIA No FEAR Act EEO Data Government Services Buy Stamps & Shop Print a Label with Postage Customer Service Site Index About USPS Home Newsroom Mail Service Updates Forms & Publications Careers Business Customer Gateway Postal Inspectors Inspector General Postal Explorer Copyright 2012 USPS. All Rights Reserved.

USPS.com - Track & Confirm https://tools.usps.com/go/trackconfirmaction.action Page 1 of 1 4/20/2012 English Customer Service USPS Mobile Register / Sign In Search USPS.com or Track Packages Quick Tools Ship a Package Send Mail Manage Your Mail Shop Business Solutions Track & Confirm GET EMAIL UPDATES PRINT DETAILS YOUR LABEL NUMBER SERVICE STATUS OF YOUR ITEM DATE & TIME LOCATION FEATURES EI369605438US Express Mail Delivered April 16, 2012, 11:21 am NEW YORK, NY 10016 Guaranteed By: April 16, 2012, 3:00 PM Proof of Delivery Arrival at Post Office April 16, 2012, 11:10 am NEW YORK, NY 10010 Processed through USPS Sort Facility Depart USPS Sort Facility Processed through USPS Sort Facility Depart USPS Sort Facility Processed through USPS Sort Facility Dispatched to Sort Facility April 15, 2012, 8:52 am NEW YORK, NY 10199 April 15, 2012 NEW YORK, NY 10199 April 15, 2012, 1:23 am NEW YORK, NY 10199 April 14, 2012 HARTFORD, CT 06199 April 14, 2012, 7:07 pm HARTFORD, CT 06199 April 14, 2012, 6:17 pm MILFORD, CT 06460 Acceptance April 14, 2012, 12:00 pm MILFORD, CT 06460 Check on Another Item What's your label (or receipt) number? Find LEGAL ON USPS.COM ON ABOUT.USPS.COM OTHER USPS SITES Privacy Policy Terms of Use FOIA No FEAR Act EEO Data Government Services Buy Stamps & Shop Print a Label with Postage Customer Service Site Index About USPS Home Newsroom Mail Service Updates Forms & Publications Careers Business Customer Gateway Postal Inspectors Inspector General Postal Explorer Copyright 2012 USPS. All Rights Reserved.