Peter J. Kurweil, M.D., P.C. v Ferraro

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Peter J. Kurweil, M.D., P.C. v Ferraro 2011 NY Slip Op 33401(U) December 15, 2011 Sup Ct, Nassau County Docket Number: 600206-10 Judge: Timothy S. Driscoll Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. ----- --------_..----------------------------------------------------------------------------------------------)( -------------------------------------------------------------------)( [* 1] SUPREME COURT- STATE OF NEW YORK SHORT FORM ORDER Present: HON. TIMOTHY S. DRISCOLL Justice Supreme Court ---_._---- J( PETER J. KURWEIL, M. D., P. C., Plaintiff, -against- TRIALAS PART: 20 NASSAU COUNTY Index No: 600206- Motion Seq. No: 1 Submission Date: 11/2/11 JOHN FERRRO, Defendant. JOHN FERRO, Third-Party Plaintiff, -againstNORTH SHORE-LONG ISLAND JEWIH HEALTH SYSTEM, GLEN COVE HOSPITAL and LUIGI M. CAPOBIANCO, M.D., Third-Part Defendants. The following papers having been read on this motion: Notice of Motion, Affirmation in Support and Exhibits.................. Memorandum of Law in Support.......................................................... Affrmation in Opposition and Afdavit in Opposition ................. Affrmation of J. Levy and Exbibits...................................................... Reply Memorandum of Law in Further Support........................... ) (" [* 2] This matter is before the Cour for decision Defendats Nort on the motion fied by Third- Nort Shore Shore Long Island Jewish Heath System (" Par ), Glen Cove Capobianco ) (collectively "TPDs ) on Hospital ("Hospital"), and Luigi M. Capobianco (" 2011, following oral arguent before the Cour. June 30, 2011 and submitted on November 2 motion. For the reasons set forth below, the Cour denies the BACKGROUND Relief Sou!!t A. TPDs move for an Order, pursuant to CPLR Third par Complait ("TPC") in its entirety. 3211(a)(1), (5) and (7), dismissing the ') opposes the motion. Defendantlird-Par Plaintiff John Ferro ("Ferraro Plaitiff' ) takes no position on Plaintiff Peter J. Kurzweil, M. D., P. C. (" Kureil" or " the merits of the motion, but requests that, if the Cour grts the motion, the Cour condition its Order on a requirement that the TPDs appear and produce documents as nondepositions in ths B. pares at matter. The paries ' History Mai Action ), Plaintiff alleges In the Complaint (Ex. B to Rosenberg Aff. in Supp. '), pursuat to which Ferraro agreed that he and Ferraro entered into an agrement ("Agreement' Ferrar to render medical professional services on behalf of Plaitiff. Plaintiff alleges that ) in the Agreement , following violated the restrctive covenants ("Restrictive Covenats Fen-aro s resignation from Plaintis employment , by operating a medical practice out of the offce of Capobianco , which is with the Restrcted Territory as defined in the Restrctive Covenants. Capobianco is an employee of the Hospital. ), Ferraro In his Verified Answer to the Mai Action (Ex. C to Rosenberg Mf. in Supp. assert numerous afative defenses. In his Nineteenth Afnnative Defens, Ferraro aleges that: As a result of Plaitiffs conduct, including but not limited to plaintiffs fraudulent inducements to Defendant to enter the alleged contractual relationship on misrpresentations both in the affative and by omission and its later conduct in conductig frudulent biling practices and ordering unecessar tests on living facilties patients and residents of certn nursing homes and assist care and requiring defendant to engage in that activity on behalf of the PC, which Defendant refued, Defendant, John Ferraro was constrctively tenninated by [* 3] the Plaintiff frm his employment and therefore the Contract or any of its provisions regarding any restrictive covenants are null and void and unenforceable against this anwerig Defendant. Ferraro also asserted counterclais , in which he alleged that 1) pursuat to a contrct between Ferro and Plaintiff, Plaintiff was obligated to provide payment to Defendant for the (3) years on behalf of Plaintiff; 2) Plaintiff services rendered by Defendat for a perod of contrct by advising the TPDs via letter dated engaged in tortous interference with a March 24 2009 ("Letter ) that Ferraro had violated the Agreement, which resulted in the Hospital prematuely termating its contract with Ferraro; and 3) Ferraro is entitled to rescission of the Agreement in light ofPlaintifrs allegedly frudulent statements and omissions that induced Ferraro to enter into the Agreement. The TPC (Ex. A to Rosenberg Aff. in Supp. ) contains five (5) causes of action. They are: 1) Capobianco, individually and as an agent of the other TPDs, represented to Ferraro that the harless in the event that Plaintiff pursued TPDs would defend, indemnify and hold Ferraro , and Fenaro reasonably relied on those legal action in connection with the Restrictive Covenant representations to his detrment; 2) the TPDs breached their agreement to defend, indemnify and hold FelTaro haess by failing to defend Ferraro in the Mai Action and terminatig Ferraro Januar 21, 2009 agreement with employment with the Hospital; 3) the TPDs breached their Ferraro ("Hospita Agreement") by terminating Feraro s employment with the Hospital following their receipt of the Letter; 4) TPDs breahed good faith and fair thei implied duty of dealing by failing to comply with their obligations under the Capobianco promise and Hospita indemncation and/or Agreement; and 5) Feraro has adequately pled facts that would support contrbution by TPDs to the extent that their conduct contrbuted to Fenaro In opposition to the motion, Ferraro affirms the trth s daages. of the allegations in regarding Capobianco s promises to him to defend and/or indemnfy Ferar legal action agait hi in connection with his prior employment. Feraro the TPC if Plaintiff took avers, inter alia, tht that Capobianco 1) reviewed Ferraro s Agreement with Kurwei1; 2) repeatedy assurd Ferraro 'take care of me " by he wanted to employ Ferro; 3) ass ed Ferraro that the TPDs would ' took legal action , and the Hospita had a " stable defending and/or indemnifyg him if Plaintiff oflawyers" that would defend hi (Ferro Aff. in Opp. at' 7); and 4) advised Feraro that he [* 4] Ferro and promises Capobianco made to had notified Nort Shore and the Hospita of the affirm that, based on these provided them with a copy of the Agreement. Ferraro representations, he entered into the Hospital Agreement. Ferraro submits that his employment with TPDs was terminated based on the Letter or, honor terminte his employment alternatively, in bad faith because it was easier for TPDs to TPDs labeled his termination as one for Capobianco s promises to Feraro. Ferraro afrms that cause, but disputes that characterition. As a result of the termination, Ferraro suffered th afliation with certain insurance damages includi 1) sudden unemployment, 2) a loss of his companes, resulting in his havig to reapply for inurance credentials which took several as a result of the months , 3) a loss of privileges at the Hospital, 4) injur to his reputation foregoing, and 5) an inabilty to pay the mortgage on his home and amassing of other finacial debts. C. The paries ' Positions inter alia that 1) Ferraro s allegations that TPDs agreed orally to , as set forth in are not viable because they are bared by a) the Statute of Frauds TPDs submits, indemnfy hi General Obligations Law (" GOL" 701(a)(2), and b) the merger clauses in the Hospita canot Agreement; 2) Ferraro s first cause of action for promissory estoppel be sustaned because he has not pled a clear and unambiguous promise, which is a required element of this cause of action; 3) in light of Ferro' s assertons in his Verified Answer that he was constructively terminated from his employment with Plaitiff, based on Plaitiffs allegedly his resigntion was unethcal behavior, Ferraro should be judicially estopped from assertg that s third cause attibutable to his detrienta reliance on representations by the TPDs; 4) Ferrar termted his of action for brech of contract must be dismissed because the Hospital properly employment for cause and without notice, puruant to the Hospital Agreement; 5) Ferraro fourh cause of action for breach of the implied duty of good faith and fair deaing is duplicative of his breach of contrt clas and , therefore , should be dismissed; and 6) the Cour should , in light of Ferraro dismiss the fift cause of action, seeking contribution or indemnification faiure to allege facts under which some indemnfication or contrbution would be applicable. Ferraro opposes the motion, submitting tht 1) Ferraro has adequately pled the first cause of action in the TPC, based on promissory estoppel by allegig that the TPDs promised Ferraro [* 5] that they would defend, indemnify and hold Ferro haress in the event that Plaintiff instituted legal action against Ferraro regarding his employment with the Hospita, on which he reasonably action, relied to his detrment; 2) there are no merger clauses applicable to the second cause of related to the oral agreement between Ferraro and Capobianco; the merger clauses relate to the the second cause of action is not Hospita Agreement, to which Capobianco is not a par; 3) another tht must as it is not a promise to anwer for the debt of bared by the Statue of Frauds, be in wrtig; 4) assumg that Capobianco s promise to indemnfy Ferraro was arguendo required to be in wrtig, the doctrine of promissory estoppel is an exception to that requirement; 3) the thid cause of action, for breach of the Hospita Agreement, is pled in light of the allegations that Nort Shore wrtig adequately and the Hospital breached the Hospital daages and s employment, resulting in money Agrement by improperly termatig Ferraro four cause of action for breach of the implied duty of injur to Ferraro s reutation; 4) the the event that the breach of contract causes good faith and deag is sufciently pled so tht, in of action canot be sutaied, Ferraro may recover from the TPDs for their breach of the duty of cause of action good faith and fai dealing; and 5) it would be inappropriate to dismiss the ' dispute as to the existence of the for indemnfication and/or contrbution in light of the partes fi oral agreement between Ferraro and Capobianco. RULING OF THE COURT A. CPLR Stadards for Dismissal pursuat to A complaint may be dismissed based upon documenta evidence 3211(a)(1) only if the factul allegations contaned therein are definitively contradicted Yew Prospect, LLC by the evidence submitted or a defense is conclusively established thereby. v. Szulman 305 A. 2d 588 (2d Dept. 2003); Sta-Bright Services, Inc. v. Sutton 17 A.DJd 570 (2d Dept. 2005). Pursuant to CPLR 3211(a)(5), a par may move for judgment dismissing one or more causes of action asserted against him on the ground that the cause of action may not be maintaned because of the statute of frauds. 3211 (a)(7), In addition, it is well settled that a motion interposed pursuant to CPLR which seeks to dismiss a complaint for failure to stte a cause of action, mus be denied if the factual allegations contained in the complaint constitute a cause of action cognzable at law. [* 6] v. Guggenheimer W 232 43 N. Y.2d 268 (1977); 511 Ginzburg, Jennifer v. Owners Corp. an applicatio , the Court must 2d 144 (2002). When enterting such tre and liberally constre the pleadg. In so doing, the Cour must accept the facts alleged as Realty Co. 98 N. drwn Leon therefrom. accord to the plaintiff every favorable inference which may be however, the Cour will not presume as tre 84 N. 2d 83 (1994). On such a motion, Martinez, flatly contradicted by the evidence. bare legal conclusions and factual clais which are 298 A.D. 2d 372 (2d Dept. 2002). Palazzolo v. Herrick, Feinstein, Relevant Causes of Action B. To establish a cause of action for breach of contract, one must demonstrate: 1) the , 3) perormance by existence of a contract between the plaintiff and defendant, 2) consideration breach. the plaintiff, 4) breach by the defendat, and 5) damges resultig from the Furia, v. See also JP Morgan Chase 116 A.D. 2d 694 (2d Dept. 1986). Furia v. 69 A.DJd J.H. Electric, 802 (2d Dept. 2010) (complaint sufficient where it adequately alleged existence of contract s breach of contract and resultig damges), plaintiffs performance under contract, defendant' citig, inter alia, Furia, supra. The elements of a cause of action based on promissory estoppel are a clear and ' by the par to whom the promise is unambiguous promise, reasonable and foreseeable reliance 724 v. Miltz 77 A. DJd 723, Schwartz made, and an injur susined in reliance on that promise. Clarkstown Cent. School v. Agress 16 N. 3d 701 (2011), citing (2dDept. 2010), Dist., Iv. app. den., 69 A.D. 3d 769, 771 (2d Dept. 2010), quotig Wiliams v. Eason, 49 A. 3d 866, 868 (2d Dept. 2008). The implied covenant of good faith an fair dealing embraces a pledge par anyting which wil have the effect of destoyi or injuring the right of the other tht neither shall do to receive the frts 232,rd Owners Corp. Educational Testing Serv., of v. Moran the contract. Jennifer Realty Co., 87 N. v. Erik, 98 N. 11 N. 3d 452, 456 (2008), citing 51 2d 144, 153 (2002), quotig Dalton 2d 384 , 389 (1995) (additional citations omitted). The implied covenant of good faith and fair dealing will not impose an obligation that would be LLC, 42 A.D. 3d 475 Washington Group, v. Adams inconsistent with the terms of the contract. 476 (2d Dept. 2007), citig, inter alia, Horn v. New York Times, 100 N. 2d 85, 93 (2003). [* 7] Judicial Estoppel C. par from framing his The doctre of estoppel against inconsistent positions precludes a Kimco of prior judicial proceeding. maner inconsistent with a position taen in a pleadings in a is to be distinguished from 163 A.D.2d 573, 574 (2d Dept. 1990). It v. Devon, New York, Inc. opportity to litigate the issue in the prior collateral estoppel which assumes a ful and fair doctre rests upon Co. 65 N. 2d 449, 455 (1985). The v. Lily Kaufman Id. citing action. permttd to lead a cour to fid a fact one way and then the principle that a litigant should not be otherwse. The contend in another judicial proceeding that the same fact should be found policies underlyig preclusion of inconsistent positions are general considerations of the orderly quoting Id, dignty of judicial proceedings. administration of justice and regard for the v. Environmental Concern D. Larchwood Constr. Corp. 101 A.D. 2d 591, 593 (2d Dept. 1984). Statute of Frauds 701 provides, in pertinent par GOL as follows: undertg is void, unless it or some note or par a. Every agreement, promise or to be charged memoradum thereof be in wrtig, and subscribed by the undertking: therewith, or by his lawfl agent, if such agrement, promise or 2. is a special another promise to answer for the debt, default or miscaiage of person... The promise by one person to indemnify another for becoming a guaranty for a thd is Barclays Bank of New York not withn the statute of frauds, and need not be in wrting. Goldman, 517 F. Supp. 403, 414 (S. Y. 1981), quoting Jones v. Bacon, 145 N. Y. 446 449 plaintiffs sued defendants as guantors of debts incured by the third-par par defendant known as DDIL. 517 F. Supp. at 406. The defendants commenced a thid- (1895). In Barclays, action for indemnty againt DDIL and two individuals afliated with the One of Id DDIL. Id. those individuals ("Moshe ) was an offcer and controlling shareholder ofDDIL. at 407-408. agrem In the thd-par complait, the defendats alleged that they signed the guaantee only on Moshe s personal assurce that al ofDDIL' s debts would be paid and on his oral promise that he would indemnify them against all clai assertd by plaitiff. Id at 408. The tht DDIL or Moshe defendants also alleged that Moshe orally promised one of the defendants defendat paid out would reimburse the defendant for any ofDDIL' s debts to other creditors that [* 8] of his personal fuds. indemnfy defendants for cour held that 1) Moshe s alleged promise to Barclays The becoming guantors, and 2) Moshe s alleged promise to reimburse the individual defendant for his payment ofDDIL' s debts, were not with Id. the Statute of Frauds. at 415. In so doing, the 140 Misc. 724 (Sup. Ct. Broome Co. v. Klionsky, Gilnsky Cour relied on the reasonig in the cour held that defendant' s ora promise that if plaintiffs guaranteed Gilnsky 1931). The notes of his brother ("Israel"), defendant would then indemnify the plaintiffs against loss was not the plaitiffs became guartors on Israel' s notes and Glinsky, withi the Statute of Frauds. In holding tht defendat' when Israel defaulted they were required to pay Israel's creditors. In Cour held as follows: Glinsky promise was not withn the Statute of Frauds, the The defendant' s promise was not to pay the indebtedness of his brother Israel to , but which the bans; his promise was to pay an indebtedness not in existence plaitiffs as guantors of the ban' would come into existence if and when these indebtedness were required to pay and did pay that indebtedness. 140 Misc. at 725- 726, cited in Glinsky, E. Jones, 517 F. Supp. at 414. Indemnfication A par' s right to indemnification may arise from a contract or may be implied based on 2d 680, v. McCarthy paries. the law s notion of what is fair and proper as between the Mas 17 N. 3d 369, 374- 375 (2011), quoting Construction, Inc., v. Turner Two Bridges Assocs., 75 690 (1990). Implied, or common law, indemnty is a resttution concept which enrchment of one permits shiftng the loss because to fail to do so would result in the unjust par at the expense of the other. New York F. SO N. Id at 375, quoting 2d 211 216-217 (1980), reh. den. citig Mas, supra, 50 N. McDermott v. City of 2d 1059 (1980). Application of these Principles to the Instant Action The Cour denies the motion by TPDs based on the Cour' s conclusion that 1) Ferraro has adequately pled a cause of action based on promissory estoppel by alleging that the TPDs promised Ferraro that they would defend, indemnfy and hold Ferraro haless in , on Plaintiff intituted legal action agaist Ferrar regarng his employment with the Hospital the event that stage of the which he reasonably relied to his detrent; 2) the Cour canot, at ths nacent indemnfy Ferraro is litigation, conclude as a matter of law that Capobianco s oral promise to [* 9] bared by the Statute of Frauds; 3) Ferraro ha adequately alleged that the TPDs breched their oral agreement to indemnify him agaist legal action by Kureil, and improperly terminated fourt cause of action for him under the Hospital Agreement; 4) Ferraro has adequately pled the in connection with the promises allegedly breach of the implied duty of good faith and deaing dismss the fift cause of action made by Capobianco to Ferraro; 5) it would be inappropriate to the litigation in light of the Cour' s denial for indemnification and/or contrbution at this state of ofTPDs ' motion to dismiss the substantive causes of action in the TPC, and the allegations in the TPC which might support indemncation or contrbution by the TPDs if Ferraro is deterined to be liable to Kurzweil on the Main Action; and 6) the principle of judicial estoppel, , does not bar the TPC based on assertons made by Ferraro in his Answer in the Main Action positions that, though different, are not based on the Cour' s conclusions that FeITo ha taen action. so inconsistent as to warant application of the doctne to this All matters not decided herein are hereby denied. Ths constutes the decision and order of the Cour. the Cour The Cour reminds counel for the paries of their requied appearance before for a Certfication Conference on Januar 11 2012 at 9:30 a. DATED: Mineola, NY December 15, 2011 1l""' DEC 2 1 2011 NASSAU COUNT)' S OFFiCe COUNTY CLERK'

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