Opinion
651019/2019
07-10-2020
C & A SENECA CONSTRUCTION LLC, Plaintiff, v. G BUILDERS LLC and BG Construction, LLC, Defendants.
Zisholtz & Zisholtz, LLP, Garden City, NY (Stuart S. Zisholtz of counsel), for plaintiff. Law Office of Michael Gasi, East Elmhurst, NY (Michael Gasi of counsel), for defendants G Builders LLC and BG Construction, LLC.
Zisholtz & Zisholtz, LLP, Garden City, NY (Stuart S. Zisholtz of counsel), for plaintiff.
Law Office of Michael Gasi, East Elmhurst, NY (Michael Gasi of counsel), for defendants G Builders LLC and BG Construction, LLC.
Gerald Lebovits, J.
The following e-filed documents, listed by NYSCEF document number (Motion 001) 1, 2, 4, 5, 7, 10, 18, 19, 20, 21, 22 were read on this motion to DISMISS.
This is an action by plaintiff C & A Seneca Construction LLC against defendants G Builders LLC, and BG Construction, LLC for breach of contract and account stated. Defendants move to dismiss under CPLR 3211 (a) (5) ; the motion is denied.
BACKGROUND
In October 2016, plaintiff entered into an agreement with defendants under which plaintiff would perform construction work in connection with a project on Pier 94 on the West Side of Manhattan. The agreed-upon cost of the Pier 94 project was $240,100. In December 2016, plaintiff executed a lien waiver titled "Partial Waiver of Lien." The $75,000 check written by defendant in accordance with this waiver was considered to be full payment for all work through December 23, 2016. Plaintiff continued to work on the project after the lien waiver was executed.
Defendants assert that a second "Partial Waiver of Lien" was executed on March 10, 2107 in connection with a $50,000 payment for all work completed through that date. Additionally, a dispute had arisen between the parties because defendants did not believe that some of plaintiff's work was of acceptable quality. Defendants claim this dispute was resolved in an additional lien waiver titled "Final Waiver of Lien," also executed on March 10, 2017, in exchange for a payment of $3,184.71.
Plaintiff alleges that only $75,000 of the original $240,100 fee has been paid, leaving defendants with an outstanding balance of $165,000. And plaintiff brought this action to obtain that $165,000 (plus interest), asserting causes of action for breach of contract and account stated.
Plaintiff does not address the asserted $50,000 lien waiver in the complaint or in its affidavit in opposition. The question whether defendants' outstanding balance prior to the asserted final lien waiver was $165,000 or $115,000 is not material on this motion.
Defendant now moves to dismiss under CPLR 3211 (a) (5), asserting that plaintiff released any claim for the $165,000 when it executed the "Final Waiver of Lien" in March 2017.
DISCUSSION
CPLR 3211 (a) (5) allows a party to move for judgment dismissing a cause of action asserted against other parties because of a release from payment.
Generally, "a valid release that is clear and unambiguous on its face constitutes a complete bar to an action on a claim which is the subject of the release absent fraudulent inducement, fraudulent concealment, misrepresentation, mutual mistake or duress." ( Global Precast, Inc. v. Stonewall Contr. Corp. , 78 AD3d 432, 432 [1st Dept 2010] ; accord Tri-State Envtl. Contr., Inc. v. PT & L Contr. Corp. , 5 AD3d 127, 128 [1st Dept 2004].) If, however the "circumstances surrounding the release, as well as the parties' course of dealings, evinces that the parties' intentions were not reflected in the general terms of the release, the release does not conclusively establish a defense as a matter of law." ( Orangetown Home Improvements, LLC v. Kiernan , 84 AD3d 902, 903-904 [2d Dept 2011].)
Here, defendants argue that the "Final Waiver of Lien" serves as a full release of plaintiff's right to further payment. This court is not persuaded.
In Tri-State , the court identified two factors that distinguished a partial waiver from a final waiver: (1) language clearly indicating finality and (2) the amounts in which the payments were made. (See 5 AD3d at 128.) For example, in that case the first two lien waivers at issue stated that "work had not been completed," while the last waiver stated that the work had been completed." ( Id. at 127.) And "the original contract price was $800,000," and the total amount paid after execution of the last lien waiver was $847,711.60. (Id. )
The record on this motion reflects that here, as in Tri-State , plaintiff executed three lien waivers in connection with its work on the Pier 94 project.
The record on this motion reflects that the "Final Waiver of Lien" on which defendant relies was the third lien waiver executed in connection with plaintiff's work on this project. Each of the three waivers states that plaintiff "hereby waives, to the extent of the amount of such payment, any and all liens, or rights to file any lien or liens against [defendants] ... on account of labor or materials or both furnished" through the date of execution. (See NYSCEF No. 7 at 2, 4, 7.) The only differences between the last waiver and the other two are (i) the last waiver is entitled "Subcontractor Final Waiver of Lien," rather than "Subcontractor Partial Waiver of Lien"; and (ii) the first two waivers state that the waiver is in "consideration of payment to the Subcontractor of" $75,000 and $50,000 respectively, and give a corresponding check number, while the last waiver states that the waiver is "in consideration of payment to the Subcontractor of 100%," and gives a corresponding check number. (See NYSCEF No. 7 at 2, 4, 7.)
These small differences in the last of the three waivers are a thin reed on which to rest defendants' argument that plaintiffs clearly and unambiguously were thereby releasing all remaining claims to payment. And that argument is further undermined by the amount of the payment described in the last waiver as consideration. The check referenced in the "Final Waiver of Lien" was in the amount of $3,184.71. (See NYSCEF No. 7 at 2, 3.) Yet at the time that waiver was executed, defendants had paid at most $125,000 on a $240,100 project, leaving at least $115,000 unaccounted-for.
Defendants assert that this remaining sum can be explained by the fact that the $3,184.71 payment was to resolve a dispute between the parties about whether plaintiff's performance met the standards originally agreed on by the parties. (See NYSCEF No. 5 at 9.) That is, on defendants' account, plaintiffs apparently agreed to release their claim to more than $110,000, or 97% of defendants' outstanding balance, to settle the dispute about whether plaintiffs' work was satisfactory. Yet nothing in the language of the last lien waiver—or any other document in the record on this motion—refers to such a settlement, or such a drastic write-off, as one would expect.
In these circumstances, and on this record, defendants have not shown that the lien waiver on which they rely clearly and unambiguously released plaintiff's claim to further payment.
Accordingly, for the foregoing reasons it is hereby
ORDERED that defendants' motion to dismiss under CPLR 3211 (a) (5) is denied.