Saeed Epakchi DMD, P.C. v Araghi

[*1] Saeed Epakchi DMD, P.C. v Araghi 2012 NY Slip Op 51480(U) Decided on August 8, 2012 County Court, Suffolk County Tarantino, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on August 8, 2012
County Court, Suffolk County

Saeed Epakchi DMD, P.C., Plaintiff,

against

Mansoureh M. Araghi and ALI ARAGHI AKA AKBAR, Defendants.



38529/2008



Richard Sokoloff

3245 Route 112, Suite 1

Medford, NY, 11763

631-696-8545

Attorneys for Plaintiff

Collado, Collado & Fiore, PLLC

14 Washington AvenueBrentwood, NY, 11717

631-273-8444

Attorneys for Defendant

Andrew G. Tarantino, J.

Plaintiff Saeed Epakchi, DMD, PC ("Epakchi") commenced this action by filing a Summons and Verified Complaint on October 21, 2008. Epakchi is the dentist and the owner of Family Dental of Plainview, PC. Plaintiff alleged breach of a verbal agreement seeking $16,243.20 for unpaid dental bills, and $6,627.22 in legal fees. On April 4, 2012, the action was transferred, pursuant to N.Y Civ. Pract. Laws & Rules §325(d), to this Court for trial without a jury. Trial was conducted on June 5, 2012. There was no dispute that any of the dental services provided by Epakchi were rendered. Defendants, however, denied that they owed Plaintiff any money. The Court reserved decision.

[*2]TESTIMONYPlaintiff's case

Epakchi testified that he rendered dental services to Defendants from 2001 to 2008. He treated Mrs. Araghi once or twice a year. Although he received payments from Mrs. Araghi's insurance carrier, it did not cover all the charges. Epakchi stated he did not know Defendants, but was aware of a friendship they had with his parents. Because of that friendship, he said, he was ashamed to ask Defendants for the balances due on their accounts. Yet, he conceded that he continued to treat Defendants despite the accrued account balances. He also stated that he issued "courtesy discounts" on the Defendants' accounts because of the Defendants' friendship with his parents. According to his accounting, the following were the year end account balances for each of the Defendants:

Mrs. AraghiMr. Araghi

2004 $1,089.29

2005 $3,684.20

2006 $2,967.20

2007 $7,731.302002 $2,398.00

2003 $6,566.00

2004 $6,673.00

2005 $6,848.00

2006 $6,955.00

2007 $7,525.00

Epakchi said that, except for the insurance payments, he received no other monies from Defendants except for $500.00 he received in about February 2008. He admitted that despite no additional payments from the Defendants for those several years, he continued to provide them dental services. He was aware that Mrs. Araghi was losing her job at the end of 2007, and that her insurance coverage would be terminated. He explained that he entered into a verbal agreement with Defendants whereby they would pay $500.00 per month until the balance of $4,500.00 was paid in full. Mrs. Araghi made only one payment in the amount of $500.00. Afterwards, Epakchi restored the "courtesy discounts" to the Defendants' accounts and increased their balances due. He then sued for the full amounts stated. Epakchi failed to provide any of the bills for Defendants' accounts because, as he described, once they were issued from the computer they could not be re-created. In his possession was a printout reflecting the amounts due after reversing the courtesy discounts.

Plaintiff's next witness was the dental Office Manager, Jacqueline Mayer. She testified that she worked for Plaintiff for 12 years. She first met Defendants in about 2001. Mayer confirmed that a $500.00 payment plan had been arranged with Defendants, except for two slight variations on Epakchi's testimony. First, the plan was made at the end of 2007, not 2008. [*3]Second, the monthly payments were to be made until the entire bill was paid, not just $4,500.00. Mayer said she last spoke with Mrs. Araghi in early 2008 when Mrs. Araghi, after making one payment of $500.00, said she paid all she was going to pay. She did acknowledge that in the years she worked at the office she was not aware of any other patient who continued receiving dental care with such a large accruing balance.

Defendants' case

Mrs. Araghi was the primary witness for Defendant. She said she knew Epakchi's parents, and that Epakchi was the same age as her children. She described that she and her husband socialized with Epakchi's family two-to-three times a year and, in fact, Mr. & Mrs. Araghi attended Epakchi's wedding. She began going to Epakchi for dental care as described. However, Epakchi said that he would accept the insurance reimbursements in full satisfaction of his services. She described that when she received a monthly statement with balances due, Epakchi explained to her that it was required for bookkeeping purposes, but the balances would be taken care of. Mrs. Araghi then stated that each January she would receive a statement wherein any past balances were cleared, and the account began that year with a zero balance. She told the doctor that she would be losing her job at the end of 2007, and her insurance would terminate. She needed extensive dental work which Epakchi would have preferred completing over the course of several months. However, because of the insurance issue, Epakchi completed the dental work before the end of 2007. Then, in February 2008, Mrs. Araghi needed an adjustment to the work completed by Epakchi. Epakchi agreed to provide the services knowing there was no more insurance, and told Mrs. Araghi that there was no fee for his service at that time. Mrs. Araghi said that she told Epakchi that he should be paid something, so she paid him $500.00. According to her, there was never any agreement for a monthly payment plan, and her $500.00 payment was not reflective of any such agreement.

Mr. Araghi testified that Epakchi accepted their insurance reimbursements in satisfaction of his services. He was never told by Epakchi or his staff that they owed the dentist out of pocket expenses.

ANALYSIS

This case presents issues of statute of limitations, basic contract principals, State of Frauds, and account stated. At no point did Plaintiff make an argument seeking quantum meruit for the value of services rendered. There are two (2) purported agreements presented to the Court. The first is any agreement regarding the payment for services between 2001 and 2007, and the reversal of "courtesy credits" to Defendants' accounts; the second is the purported 2008 repayment plan.

The Statute of Limitations for a contract action is six (6) years. NY Civ. Pract. Laws & Rules §2 [*4]

A breach of contract claim requires four (4) elements. They are (1) formation of a contract between the parties; (2) performance by plaintiff; (3) defendants' failure to perform; and (4) resulting damage. See, Furia v Furia, 116 AD2d 694, 498 NYS2d 12 [2nd Dept 1986]. A contract is formed when there are at least two parties with legal capacity to enter into a contract give their mutual assent to the terms of a contract and there is consideration. 2 PJI 3d 4:1 at 626 (2010); see: Maas v Cornell University, 94 NY2d 87, at 93, 699 NYS2d 716 (1999). Mutual assent is often referred to as "a meeting of the minds" of the parties on all essential terms of the contract. 2 PJI 4:1 3d at 639 (2010); Matter of Express Industries and Terminal Corp. v New York State Dept. of Transportation, 93 NY2d 584, 693 NYS2d 857 [1999]; Farago v Burke, 262 NY 229 (1933), Arliss v Herbert Brenon Film Corporation, 230 NY 390 [1921]. The manifestation of mutual assent must be sufficiently definite to assure that the parties are truly in agreement with respect to all material terms. New York Matter of Express Industries and Terminal Pt. of Transportation v New York State Department Transportation, supra.

In this case, no written agreement was provided to the Court to establish either the payment for services rendered and reversal of "courtesy credits," or for the purported repayment plan. Oral agreements are limited by the Statute of Frauds, § 5€"701 of the General Obligations Law, which states in pertinent part, that

Every agreement, promise or undertaking is void, unless it or some note or memorandum thereof be in writing, and subscribed by the party to be charged therewith, or by his lawful agent, if such agreement, promise or undertaking... by its terms is not to be performed within one year from the making thereof or the performance of which is not to be completed before the end of a lifetime.

An alleged oral agreement to pay money in installments is an "agreement that is not to be performed within one year," subject to the Statute of Frauds, when the installment payment obligation exceeds one year. 72 Am.Jur.2d, §24, Statute of Frauds, July 2010. Where there is absolutely no possibility in fact and law of full performance by both parties within one year, the Statute of Frauds bars enforcement of an oral contract. Americana Petroleum Corp. v Northville Industries Corp, 200 AD2d 646, 606 N.Y.S.2d 906 (2d Dep't 1994)

An account stated represents an agreement between the parties reflecting amounts due on prior transactions. JimMar Corp. v Aquatic Constr., 195 AD2d 868, 600 NYS2d 790 [3d Dept 1993]. Such an account cannot be made the instrument to create a liability where none existed, but only determines the amount of an existing valid debt. Bauer v Ambs, 144 AD 274, 128 NYS 1024 (2d Dept 1911). Where either no account has been presented or there is any dispute regarding the correctness of the account, the cause of action fails. Abbott, Duncan & Wiener v Ragusa, 214 AD2d 412, 625 NYS2d 178 (1st Dept 1995).

In a matter such as this, it is the province and indeed the obligation of the trial court to assess and determine matters of credibility. Morgan v McCaffrey, 14 AD3d 670, 789 NYS2d 274 (2d Dept 2005). Because of the inconsistencies between Plaintiff's and the Office Manager's [*5]testimony, the Court finds Mrs. Araghi's testimony more credible. This opinion is further supported by the fact that Epakchi downplayed Defendants' familiarity with his family, and denied knowing the Defendants despite their attendance at his wedding.

The burden is upon Plaintiff to plead and prove his direct case by a fair preponderance of the credible, relevant and material evidence with the same burden imposed upon the Defendants respecting their affirmative defenses. PrinceRichardson on Evidence, § 3210; Torem v Central Avenue Rest, 133 AD2d 25, 518 NYS2d 620 [1st Dept 1987]. Credible evidence has been defined as evidence that proceeds from a credible source and reasonably tends to support the proposition for which it is offered and is evidentiary in nature and not merely a conclusion of law, nor mere conjecture. Dille v Kelly, 31 Misc 3d 1232(A) (NY Supreme, NY County, 2011). The burden of proving the existence of a contract and performance according to its terms is upon the party suing for damages for its breach. Fisch on New York Evidence, Second Edition, § 1098, Lond Publications 1977/2008.

Plaintiff must first survive the Statute of Limitations. This issue pertains only to the services rendered between 2001 and 2008. The action was commenced October 2008. Accordingly, Plaintiff is barred from any claim for unpaid balances up to and including October 2002. According to the table set forth above, that amount would be about $2,398.00 (the Court having not been provided with a monthly itemization of fees incurred for that year). Thus, Plaintiff is barred from seeking payment for the $2,398.00.

Plaintiff must next avoid any bar to his claim by the Statute of Frauds. This issue pertains only to the 2008 repayment agreement because there was no testimony about an agreement, verbal or otherwise, reversing the "courtesy credits." On this issue, Plaintiff's conflicting and unclear evidence defeated his arguments. Plaintiff testified that the 2008 agreement was $500.00 per month until $4,500.00 was paid. Yet, in significant contrast, the Office Manager described the agreement as $500.00 per month until the full account balance was paid [emphasis added]. While repaying $4,500.00 at $500.00 per month would take less than a year, repaying $15,256.00 (see the two account balances in the above chart) at $500.00 per month could not , such an obligation could not be fulfilled within one (1) year; the State of Frauds bars Plaintiff's recovery. Even if the Court sorted through the Plaintiff's confusing testimony about what was credited or not, the account balances may have been as low as $8,686.00; still unable to be repaid within one (1) year under the plan. Accordingly, the Statute of Frauds remains a bar to Plaintiff's recovery.

Assuming the Statute of Frauds was not a bar to Plaintiff's claims, the Court further finds that the required elements to establish a contract have not been proven. As to both agreements, the Court finds that there was no meeting of the minds. As to the reversal of his "courtesy credits," Plaintiff reinstated those fees unilaterally and without any discussion with the Defendants. Plaintiff failed to provide any writing or testimony about discussions with Defendants wherein it was explained, let alone agreed, that if they did not pay any bill that Plaintiff would reverse the "courtesy credits" and increase their balance due.As to the 2008 repayment agreement, the Plaintiff's evidence was inconsistent as set forth earlier. Further, as explained by Mrs. Araghi, [*6]each January of the next year her account was zeroed out, and Plaintiff continuously and repeatedly accepted her insurance payments in satisfaction of the services rendered for that year. It is wholly inconsistent that Plaintiff would suddenly have changed his method of providing services and accepting insurance payments at the end of 2007. It was undisputed that he worked to complete Mrs. Araghi's dental needs before the end of 2007 when her insurance would terminate. It remained unexplained, and contributed to calling Plaintiff's credibility into question, that if Defendants' accounts at the end of 2007 totaled $15, 256.00, why would Plaintiff arrange for a repayment plan for only $4,500.00. Although not before this Court, and not a factor in its determination, the Court detected that more occurred here between the relationships of the parties and Plaintiff's family that could account for the creation of this dispute and its apparent discrepancies. That being said, Plaintiff failed to establish by the preponderance of credible evidence that there was a meeting of the minds sufficient to form a contract.

Plaintiff also failed to meet the elements necessary to establish an account stated. There was no accounting submitted, and the only document Plaintiff had was a ledger of balances he alleged to be due. He did not generate any of the regular bills and accountings that were sent to Defendants.

The Court declines to address Plaintiff's demand for attorney's fees.

By reason of the foregoing, it is hereby

ADJUDGED that Plaintiff failed to plead and prove its case by a fair preponderance of the credible, relevant and material evidence; and it is further

ORDERED, that the complaint is dismissed.

This constitutes the decision and Order of the Court.

Dated: August 8, 2012

Andrew G. Tarantino

J.C.C.