Utopia Home Care, Inc. v Revival Home Health Care, Inc.

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Utopia Home Care, Inc. v Revival Home Health Care, Inc. 2016 NY Slip Op 32138(U) August 17, 2016 Supreme Court, Suffolk County Docket Number: 03404/2013 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] SHORT f'ORM ORDER COPY INDEX NO. 03404/2013 SUPREME COURT- STATE OF NEW YORK COMMERCIAL DIVISION IAS PART 48 - SUFFOLK COUNTY PRESENT: HON. JERRY GARGUILO SUPREME COURT JUSTICE I DECISION AFTER TRlAL UTOPIA HOME CARE, INC., PLAINTIFF'S ATTORNEY: Plaintiff, -against- REVIVAL HOME HEALTH CARE, INC., SPITZER CONSULTING CO., LTD. AND GAMZEL NY, INC. d/b/a REVIVAL HOME HEALTH CARE, /\HERN &AHERN, ESQS. ONE MAIN STREET KINGS PARK, NY 11754 631-269-9500 DEFENDANT'S ATTORNEY: Attorney for Gamzel, NY, Inc. ARI ERLTCHMAN, ESQ. 4770 WHITE PLAINS ROAD BRONX, NY 10470 Defendants. This matter was tried before the Court on Monday, June 20, 2016 and Tuesday, June 21, 2016. On behalf of the Plaintiff, Utopia Home Care, Inc., (Utopia) Diane Martinez was called as a witness. The Defendant called Dina Benedetto and Steven Schwartz. The Plaintiff recalled Diane Martinez as a rebuttal witness. The Plaintiffs complaint is a breach of contract action wherein the Plaintiff claimed that it is entitled to a judgment in the amount of Sixty Thousand Six Hundred Seventy Two Dollars and Thirteen Cents ($60,672.13 ), plus interest for services rendered to the Defendant, Revival Home Health Care, Inc., (Revival). The Defendant claimed that recovery is barred by an amendment to a written contract that required the Plaintiff to submit all invoices withi n thirty (30) days. Failing to submit invoices forfeits payment. As noted above, the Plaintiffs sole witness was Diane Martinez, the President of Utopia. Martinez testified as to the familiarity with the claim and identified a written contract between the parties dated January 1, 2006. That contract was executed by Manuel G. Martinez, on behalf of Utopia. It should be noted that Utopia is a family run business. [* 2] l 'TOI'!. I I/OM!:' C·IRE, /t\'C t•. R/:'l'IJ->IL 110,l/E llE·lf. Tl/ (A RT:, It C, ET ·If. INDl:.'X 1 WJ.: J4fJ4/ 20/J f'. I (i /;' :! Diane Martinez. her father. Manuel G. Martinez and her brother, David Martinez are the sole officers and shareholders or the Plaintiff. Diane Martinez testified that only those family members \Vere authorized to enter into written contracts on behalfofUlopia. She specifically denied that anyone else \VUS allO\.vcd, permitted and/or authori zed to bind Utopia in a contractual sense. The January I. ~006 contract details the means and methods of payment to Utopia. In essence, Utopia provided services for patients reCcrred by Revival. Reviva l, in tum would pay I Jtopia an agreed upon hourly rate and Utopia wou ld pay their aides. /\.s to surticiency of'their claim. Ms. Martinez identified written invoices and back up for said invoices in support of' Utopia's claim. The dispute involves non-payment of invoices from the period commencing February 20 I 1 through May of 20 l l. It should be noted that Ms. Martinez tcsti ficd that she personally canceled her company's contract with Revival by letter dated June 6. 20 I I. indicating that Utopia would no longer service Revival's cases due to J{cvival's mandate in May or 2011 that 'vvould reduce Utop ia's reimbursement hy approximately Two Dollars ($2). Revival 's defense rests on a document it claims is a written amendment to the contract. That document, in evidence. is the basis of Revival's claim that its contract w ith Utopia was amended. That document , dated July 19, 2010 provides that Utopia will not get paid if they do not hill Revival within Thirty (30) days of service. That document which purportedly amends the agreement between the parties was executed by a person known as /\nne Marie Rahi. Revival <.:!aims that Ms. Rahi executed the document on behalf or Utopia and co11sequcntly hound them to the terms or the amendment. As noted a hon:. Ms. Martinez testi tied thar Utopia. a family owned compa ny. allowed onlv fomily members to execute legal documents on its behalf: and as such, Ms. Rabi never . ... had the authority to hind l Jtopia in a con tractual sense. Subsequent tn July 19. 20 I 0. lJtopin \\'as presented ,,·ith the purported amendment to its comract. /\.t thut timc, it::-. chief financial urticer submi tted an L 'mail to Rcvi\'al llrnt noted "Annl' Marit.: Rahi was an ndrnin istra tor for ou r New York offices only and her function was to provide oversigh t of daily operations. She had no authority to negoti ate or approve any contract amendments. We han.: 1w record of this document you sent us and therefore cannot recognizt: it as an amendmt:nt to our binding contract with you." ~OO(L It is undisputed that the parties did enter into a written contract effective .January I. Furthermore. l ltopia suhmilted doc.:11mentary proof of its hills for scn·ices remkn:d [* 3] l 'TOl'l. I lfO.H J:' C.IRE. INC l /\'L>l :X .VO.: 34()4/2013 l~ · IGH 3 1•. RF:I 'II '.·I L /IOMJ.:: Jlf:. I LTIJ C'AR/:,', INC., ET . II, in the amount or Sixty ·1housand Six I lunclred Seventy Two Dollars and Thi rteen Cents ($60.672. 13 ). The January I. 2006 contract did allow for a set off of twenty five percent (25%) or nonpayment in the event Utopia's submissions for payment did not comply with th~ terms of' the undisputed contract. Utopia submitted written documentation ol'timely billing. It is somc\vhat remarkable that the key witness as to the issue of agency. authority. apparent authority and/or cstoppel to deny authority, Anne Marie RahL was not called as a witness. More compelling is that the Defendant's witness, Steven Schwartz, could offer no testimony indicating a direct knowledge ol'thc circumstances surrounding the execution the purported amendment. Mr. Schwartz indicated that he never dealt ·with Ms. Rahi. or The Court has examined a July 19. 20 I 0 document, which the Defendant claims is the amendment Chat substantiates its defense. That document is addressed to Utopia Home Care. Brooklyn and it is to the attention or the "llomc Health Aide Vendor Administrator.'' The document reads as follows: In order to cleariy state the expectations of our abrrccment regarding time frames for suhmission of bills to Revival Home ..... .... I Iealth Care we arc sending this attestation of agreement regarding all home health care hours hilled to this agency. It is the requirement or the vendor to submit all billings to this agency in no less than 30 days from the time or service. This is a standard of practice wichin our industry and we arc !->lrongly adhering to these standards as or /\ugust 16, 20 I 0. No billings older than 30 days will be honored aflcr that date. This keeps our agency from submi tting late or non reimbursable services to the various payors of our services. Your prn111pt aucmion to this matter is greatly apprcciatl:d und expected. Pkase rdain the copy marked, "Vendor Copy" and send the copy back LO us marked "Please return this to Revival I lomc I lcalthcarc" Please return this no later than August 23. 20 I 0 to th~ follo"·ing: Name: Address: Revival I lome I lcalthcare 5350 Kings IIighwuy Brooklyn. ewYork 11203 Attn: .Joe Sochsczcwsky [* 4] l "J'Of>l..t 110.\ /f:' C-1 RI:', t.VC. /\'/J /:·.r NO.: 3404120/J I' I(,/:· 4 1·. REI J I '.-fl 1/0,\IE 111 II. Tl/ CA RI:', l.VC., t:T. IL :: You should also be aware that in the event our contract with you is renewed or extended. \\·e will require an amendment lo the contn.1ct that confirms your agreement to these terms. Please do not hesitate to communicate with us if you have any questions concerning this matter. We can be reached at: 718629- 1000 x 222 or x 2 J6. Sincerely Yours Thercatlcr, there is an acknowledgment wh ich reads as follows: ACKNOWLEDGED AND AGREED THIS 23 DAY OF July, 2010. The acknowledgment is purportedly signed by aforementioned uncalled witness. Anne Marie Rahi. the It is n<He\\·orthy. that the document relied upon by the Defendant calls itsclr a "Attestation of' /\grcemcnt." Furthermore, it is equally compelling that the July J9. 2010 purported amendment used the tol lowing language: You should also be aware that in the event our contract with you is renewed or extended, we wi II requ ire an amendment lo the contract that confi rms vou r agreement to these terms. By it's very language. the July 19, 20 I 0 documen t indicates that in the future an mrn:mlmcnt will be required comporting with contents of the July 19. 20 I 0 letter. Nowhere docs the document refer to itscll'as an amcndmcnl, and in the abscnt:e of'testimony by Ms. Rah1 011 till· question ot" authority, whether it actual or apparent, thc tldl;n~~ 111u:-it iull. 1h poi med out by the Pia inti IT To cn.:atc the <.:!aim or apparent authorit), essential to thc creation or apparent authority arc words nr conduct of' the principal. communicated to a third pany. tlwt give rise to the appearance and bel ie!' that the agent possesses authority .... "the c:-:istcncc of'apparent authority' depends upon a factual showing thl' third party relied upon the misrcprcscnlC:ltinn or the agent [* 5] ( ' TOPI I I/OJI/:· C IRI:', INC. 1·. RHV!I > 110.lll:' 111:'.·lf.Tll C IR!:', l .VC, ET .·fl ti. l .\ 'f)h".\' ,\'().; 34(14/ ](J/J P l(d:· 5 because ofsome misleading conduct on the part of the principal, not the agent. Moreover. a third party with whom the agent deals may rely on an appearance or authority only to the extent that such reliance is reasonable." Sc<: I lallock v. State. 64 NY2d 22..J.. 231. It is therefore the decision or the Court after trial lhat the Plaintiff submi t judgment in the principal sum of Sixty Thousand Six rJundrcd Seventy Two DoJJars and Thirteen Cents ($60.672.13) with statutory interest from July I, 2011 and a statutory bill of costs. The forcgoinP. constitutes the Decision Aller Trial. ..... 'Dated: August J 7, 2016