East Hampton Union Free Sch. Dist. v Sandpebble Bldrs., Inc.

Annotate this Case

Download PDF

East Hampton Union Free Sch. Dist. v Sandpebble Bldrs., Inc. 2016 NY Slip Op 30170(U) January 15, 2016 Supreme Court, Suffolk County Docket Number: 01113/2007 Judge: Jerry Garguilo Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various state and local government websites. These include the New York State Unified Court System's E-Courts Service, and the Bronx County Clerk's office. This opinion is uncorrected and not selected for official publication. [* 1] SllORT FORM ORO EH COPY INDEX NO. 01113/2007 SUPREME COURT - STATE OF NEW YORK COMMERCIAL DIVISION IAS PART 48 - SUFFOLK COUNTY PRESENT: HON . .JERRY GARGUILO SUPREME COURT JUSTICE EAST HAMPTON UNION FREE SCHOOL DISTRICT, Plaintiff, -againstSANDPEBBLE BUILDERS, INC., Defendant. ORIG. RETURN DATE: 12/14/15 FINAL SUBMITTED DATE: 1/6/16 MOTION SEQ#Oll MOTION: MD PLAINTIFF'S ATTORNEY: PINKS ARBErT BOYLE & NEMETH 140 FELL COURT, STE 303 HAUPPAUGE, NY 11788 631-234-4400 DEFENDANT' S ATTORNEY: ESSEKS, HEFTER & ANGEL ESQS. 108 EAST MAlN ST, POB 279 RIVERHEAD, NY 11901 631-369-1700 The Plaintiff, East Hampton Union Free School District (East Hampton), petitions the Court by way of motion pursuant to CPLR 3212 seeking an order of "partial summary judgment" in favor of Plaintiff and against the Defendant, limiting damages, if any, on Defendant's first counterclaim to the terms Articles 9.6 and 9.7 of the underlying agreement dated April 2002. The Defendant, Sandpebble Builders, Inc., (Sandpebble), opposes the Petition in all respects. The court has considered the following in connection with its determination: I. 2. 3. Notice of Plaintiff's Motion For Partial Summary Judgment, Affirmation In Support, inclusive of Exhibits A through J, Movant's Statement of Undisputed Facts Under Ru! 19-a; and Defendant's Affirmation In Opposition To Plaintiffs Motion for Partial Summary Judgment, Dcfondant's Response and Counterstatement to Plaintiffs Statement of Undisputed Facts Pursuant to Rule 19-a, inclusive of Exhibits A through E and Memorandum of Law In Opposition To P laintiffs Motion For Partial Summary Judgment. Response By Plaintiff To Defendant's Response and Counter-Statement To Plaintiffs Statement of Undisputed Facts Under Rule 19-a and Reply Affirmation In Further Support of Plaintiffs Motion For Partial Summary Judgment with Exhibit K. [* 2] EAST' HAMPTON UNION FREE SCHOOL DISTRICT v. SANDPEBBLE BUILDERS, INC. INDEX N0.:0111312007 PAGE2 The Plaintiff commenced this action almost 10 years ago seeking declaratory judgment that it had properly terminated a contract with the defendant. The Plaintiffs position is that proper termination does not constitute a breach. The Defendant, inter alia, seeks damages, alleging a breach by the Plaintiff. Plaintift1 s current Petition seeks partial summary judgment on the question of what damages the Defendant may recover under the contract. The Defendant claims Plaintiffs current posi tion is contrary to its prior position in that Plaintiff now asserts that it is of no consequence whether termination was proper or improper as concerns recoverable damages. The District's position rests on Article 9 of the contract (termination, suspension and abandonment) which allows for tennination. According to the Plaintiff, paragraph 9.6 of Article 9 provides for the amount to be recovered by the Defendant in the event of termination: In the event of termination not the fault of the Construction Manager, the Construction Manager shall be compensated for services performed prior to termination, together with Reimbursable Expenses then due and all Termination Expenses as defined in Paragraph 9. 7. In essence, the District claims that, regardless of the cause of termination, the Defendant's damages arc limited as per paragraphs 09.6 and 9.7 of the contract. The District's position is that the contractor is not entitled to recover traditional breach of contract damages (lost profits) as a result of its agreement and as set forth in paragraph 9.6 of the contract. In other words, fault is not an issue when it comes to termination by the District. J\s the Court secs it, the question presented is whether the Defendant, under any circumstances, is limited to damages consisting of defined "reimbursable" and "termination expenses." The District equates breach with termination without differentiation. The Defendant claims an exquisite differentiation between allowable termination and breach. The Court's notes that Article I0, section I0.6 of the underlying contract presents a merger clause. I 0.6 This Agreement represents the entire and integrated agreement between the Owner and Construction Manager and [* 3] EAST HAMPTON UNION FREE SCJJOOL DISTRJCT v. SANDPEBBLE BUILDERS, INC: IN DEX N0. :0111312007 PAGE J supersedes all prior negotiations, representations or agreements, either written or oral. This Agreement may be amended only by written instrument signed by both Owner and Construction Manager. Furthermore, Article 10 entitled Miscellaneous Provisions addresses "causes of action bclween the parties." More particularly: 10.3 Causes of action between the parties to this Agreement pertaining to acts or failures to act shall be deemed to have accrued and the applicable statutes of limitations shall commence to run not later than either the date of substantial completion for acts or failures to act occurring prior to substantial completion, or the date of issuance of the final project certificate for Payment for acts or failures to act occurring after substantial completion (emphasis added). The contract contemplates "causes of action" stemming from "acts or failures to act." The Court is also confronted with a December 20 11 decision from the Appellate Division-Second Department that noted: Since this is, in part, a declaratory judgment action, the matter must be remitted to the Supreme Court, Suffolk County, for further proceedings on so much of the first cause of action as sought a judgment declaring that the School District properly terminated the contract in accordance with its terms, the third cause of action [claiming breach on an alleged all estimating services contract], and rsandpebble's] the counterclaims and, thereailer, for the entry of a judgment, inter alia, declaring that the April 2002 contract is valid and enforceable and dismissing the second cause of action. East Hampton Union Free School District v. Sandpebble Builders, Inc., 90 /\.D.3d 815, 820 (2nd Dept. 20 I I). As per the direction of the Second Department, the issue to be tried is whether the Contract was "properly terminated ... in accordance with its terms" by the District. The Defendant suggests that the Plaintiffs Petition runs counter to accepted protocol between the [* 4] l:.'AST HAMPTON UNION FREE SCHOOL DISTRICT v. SANDPEBBl.E BUILDERS, INC. IN DEX N0.:01I1312007 PAGE4 trial court and the appellate court. The matter of Glassman v. ProHealth Ambulatory Surgery Center, 96 A.D.3d 799, 946 N.Y.S.2d 602 (2012) stands for the proposition that A trial court, upon a remand or remittitur, is without power to do anything except to obey the mandate of the h ighcr cou~, and render judgment in conformity therewith (United States v Pink, 36 NYS2d 961, 965 (1942]). The judgment or order entered by the lower court on a remittitur must conform strictly to the remittitur, and it cannot afterwards be set aside or modified by the lower court (Matter ofMinister, Elders & D eacons ofRefm. Protestant Dutch Church ofCity ofN. Y v Municipal Ct. ofCity ofN.Y, Borough of Manhattan, 185 Misc 1003, 1007 [1945], ajfd270 App Div 993 [1946], ajfd296 NY 822 [ 1947]). In the United States v. Pink found at 36 N.Y.S.2d 961 the following is found: The inferior court is bound by the decree as the law of the case; and must carry it into execution, according to the mandate. They cannot vary it, or examine it for any oth~r purpose than execution; nor give any other or further relief; nor review it upon any matter decided on a.PJJeaL for error apparent; nor intermeddle with it, further than to settle so much as has been remanded. Ex parte Sibbald, 12 Pet. 488, 37 U.S. 488, 492, 9 L.Ed. 1167. This Court will adhere to the protocol as set forth hereinabove and decide the matter at trial as articulated by the Appellate Division. Nevertheless, the parties are put on notice that the Court's recital of Article 10, Section I 0.3 of the Contract mitigates against the position taken by the Plaintiff-Petitioner herein. To hold otherwise would render Article I 0 Section I 0.3 superfluous. It is a cardinal principle of contract construction that the document should be read to give effect to al I its provisions and to render them consistent with each other. Restatement of Contracts (Second) § 202(5); see comment Mastrobuono v. ShearsonLehmanHutton, Inc., eta!, 115 S.Ct. 1212 [* 5] EAST HA MPTON UNION FREE SCHOOL DISTRICT v. SANDPEBBLE BUILDERS, INC. INDEX NO.:OI I /312007 PA(i E 5 . The interpretation advanced by the Plaintiff places Articles 9 and 10 of the Contract at odds with each other. The Petition is DENIED. The parties are to appear before the undersigned for a conference on February 1, 2016 at 9:45 a.m. The foregoing constitutes the decision and ORDER of this Court. Dated: January 15, 2016

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.