Opinion
651706/2019
06-02-2020
Judy CORBETT, Plaintiff, v. BRISTOL DEVELOPMENT CORP., Defendant.
Steven R. Goldberg, Esq., New York, NY, for plaintiff. DCL Firm, New York, NY (James J. DeCristofaro and Jason R. Mischel of counsel), for defendant.
Steven R. Goldberg, Esq., New York, NY, for plaintiff.
DCL Firm, New York, NY (James J. DeCristofaro and Jason R. Mischel of counsel), for defendant.
Gerald Lebovits, J.
The following e-filed documents, listed by NYSCEF document number (Motion 003) 51, 52, 53, 54, 55, 56, 57, 58 59, 60, 61, 62, 63, 64, 65, 66, 67, 68, 69, 70, 71, 72 were read on this motion to DISMISS.
Plaintiff, Judy Corbett, has sued defendant, Bristol Development Corp., for money she claims Bristol owes her in unpaid severance compensation. Bristol moves to dismiss under CPLR 3211. Corbett cross-moves for a default judgment under CPLR 3215 on the ground that Bristol failed to answer and that Bristol's motion to dismiss is untimely. The motion and cross-motion are each denied.
BACKGROUND
I. Corbett's Employment by Bristol
According to the allegations of the amended complaint and supporting exhibits, Corbett worked for Bristol for 30 years, beginning in 1988. In 2007, Bristol management informed Corbett in writing that it would no longer pay her regular salary increases. Instead, Bristol agreed that upon Corbett's termination at some future point, it would pay her (i) weekly salary for one year following her termination, and (ii) $25,000 (net after taxes), paid in three installments—as long as Corbett remained at Bristol until Bristol laid her off. (See NYSCEF No. 20.) In 2011, Bristol modified this severance agreement in writing to increase the net payment from $25,000 to $50,000, retaining the condition that Corbett remain with Bristol until her termination. (See NYSCEF No. 21.) In June 2012, Bristol again modified the severance policy in writing—providing that Corbett would retain her Bristol health insurance during the one year in which she was receiving her weekly salary as severance, and increasing the separate net payment from $50,000 to $90,000. The severance agreement as restated in 2012 retained the condition that Corbett remain with Bristol until her termination. (See NYSCEF No. 15.)
In January 2018, Bristol laid off Corbett. The letter notifying Corbett of her termination stated that the letter was "further to" the June 2012 severance letter agreement. (NYSCEF No. 4.) The letter stated that Corbett would receive health insurance, one year of salary as severance, and, "as outlined in your June 13, 2012 letter," $90,000 paid in three installments. (Id. ) Bristol paid Corbett nearly all of the one-year's salary, and the first two installments of the $90,000 net payment—but not the third. Corbett demanded payment of that third installment (and the last two days of her one year of severance salary); Bristol did not pay.
II. The Procedural History of This Action
In March 2019 Corbett sued, alleging that (i) Bristol breached its agreement with her by failing to pay the full amount of her promised severance; and (ii) Bristol's failure to pay the severance violated the Labor Law. She sought the missing two day's wages, the gross amount of the third severance installment, and liquidated damages under the Labor Law.
In May 2019, Bristol timely moved to dismiss the complaint under CPLR 3211 (motion sequence 001). Corbett opposed, and this court calendared the motion to be orally argued in August 2019. Bristol appeared for oral argument, but Corbett did not. This court granted Bristol's motion to dismiss on default. (See NYSCEF No. 36.)
In addition to filing opposition papers, Corbett also amended the complaint. On reply, Bristol stated that its arguments for dismissal should be applied to the amended complaint.
In September 2019 Corbett moved to vacate her default under CPLR 5015 (motion sequence 002). Corbett contended, and documented, that her attorney had not received notice of the August oral argument because NYSCEF had listed an incorrect attorney as counsel of record for Corbett. (See NYSCEF Nos. 38-46.) Bristol did not oppose the motion to vacate. This court granted the unopposed motion, and Corbett served notice of entry of the court's order on October 2, 2019. (See NYSCEF Nos. 47, 48.)
On November 1, 2019, the parties requested that this court so-order a fully executed stipulation to restore motion sequence 001 (and all papers submitted on the motion) to the calendar so that it could be resolved on the merits. (See NYSCEF No. 49.) On November 8, this court declined to so-order the stipulation, stating that the proper procedural course would instead be for Bristol to refile the motion. (See NYSCEF No. 50.)
On November 27, 2019, consistent with this court's instruction, Bristol filed the current motion to dismiss under CPLR 3211 (motion sequence 003). This motion raises the same arguments for dismissal that Bristol asserted on motion sequence 001. Corbett cross-moves for a default judgment under CPLR 3215, arguing that Bristol's motion to dismiss was untimely when measured from notice of entry of this court's order granting motion sequence 002, and that Bristol therefore is in default.
DISCUSSION
I. Corbett's Cross-Motion for Default Judgment
Corbett contends that Bristol's motion to dismiss is untimely, and therefore that the motion to dismiss should be denied and Corbett's cross-motion for default judgment granted. This court is not persuaded that Bristol defaulted in filing its motion to dismiss.
To begin with, this court is skeptical that the time in which Bristol could refile its motion to dismiss should be measured from when this court granted motion sequence 002 and vacated the dismissal of the action. After the court restored the action as a whole to active status, the parties agreed between them that the proper procedural course was simply to stipulate to restore the original motion to dismiss to the calendar and litigate the motion on its merits. It was not until this court declined to so-order that stipulation that Bristol was put on notice that it would have to seek dismissal by serving and filing a new notice of motion (and supporting papers). And Bristol filed the new motion only 19 days after entry of this court's refusal to sign the stipulation.
Further, even if one were to construe strictly the timeliness requirements for filing the new motion to dismiss, this court declines to penalize Bristol for (i) working cooperatively with its adversary to put the merits of the motion to dismiss before this court, and (ii) promptly following this court's directive to refile. Thus, if one were somehow to deem the present motion to have been untimely when filed, this court would exercise its discretion under CPLR 2004 to grant Bristol an extension of time to move. Since Bristol is not in default, Corbett's argument that this court should deny Bristol's motion as untimely and grant Corbett's cross-motion for default judgment is without merit. The cross-motion is denied.
This court's view on that point is only strengthened by the fact that this situation arose because Corbett defaulted in appearing for oral argument. Even if that failure to appear was due to a data-entry error in the NYSCEF system, as Corbett suggests, granting Corbett a default judgment now because of how matters shook out after vacatur of the dismissal of her action would be an unequitable windfall.
Additionally, Corbett's cross-motion papers do not indicate that Corbett served Bristol with advance notice of its request for default judgment, as required by CPLR 3215 (g).
II. Bristol's Motion to Dismiss
Bristol moves to dismiss under CPLR 3211 (a) (1) and (a) (7). When ruling on a CPLR 3211 (a) (7) motion to dismiss, this court must accept as true the facts as alleged in the pleadings and submissions in opposition to the motion, accord the non-moving party the benefit of every possible favorable inference and determine only whether the facts as alleged fit within any cognizable legal theory. (See Whitebox Concentrated Convertible Arbitrage Partners, L.P. v. Superior Well Services, Inc. , 20 NY3d 59, 63 [2012].) In assessing a motion under CPLR 3211 (a) (1), the motion may be granted "only where the documentary evidence utterly refutes [the non-moving party's] factual allegations, conclusively establishing a defense as a matter of law." ( Goshen v. Mutual Life Ins. Co. of New York , 98 NY2d 314, 326 [2002].)
A. The Branch of Bristol's Motion Seeking Dismissal of Corbett's Contract Claim
Bristol argues that Corbett's contract claim based on the June 2012 letter fails to state a cause of action. Bristol contends that the letter was not supported by adequate consideration. In particular, Bristol emphasizes that "[n]either a promise to do that which the promisor is already bound to do, nor the performance of an existing legal obligation constitutes valid consideration." ( Tierney v. Capricorn Investors, L.P. , 189 AD2d 629, 631 [1st Dept 1993].) But this principle does not avail Bristol here.
As Bristol itself emphasizes, Corbett "was free to resign at any time" from her employment at Bristol and seek employment elsewhere. (NYSCEF No. 65 at 10 [emphases omitted].) Bristol also promised Corbett in writing, though, that if she refrained from exercising her right to resign, Bristol would pay her one year's salary and three installments of $30,000 each (net of taxes) when Bristol ultimately laid her off. And it is undisputed that Corbett remained at Bristol until her employment was terminated. Corbett's choice effectively to relinquish her right to resign constituted adequate consideration for the severance compensation promised in Bristol's June 2012 letter.
Corbett's complaint alleges that she also agreed to forgo raises in exchange for the promised severance, which would be an additional type of consideration. Bristol submits documentary evidence that Corbett received several raises and bonuses between 2013 and 2016. That evidence does not, however, conclusively refute Corbett's allegations: in opposing the motion to dismiss, Corbett states in an affidavit that she "would not receive as many raises nor would they be ‘as expected’ or ‘as hoped for’ in exchange for the severance agreement offered" by Bristol. (NYSCEF No. 61 at 1 ¶ 2.) Corbett may or may not ultimately be able to prove this factual assertion. But on the present record Bristol's submissions do not utterly refute the existence of this form of consideration, as required for dismissal under CPLR 3211 (a) (1).
Bristol argues that it has never had a regular policy or practice of paying severance. (See NYSCEF No. 52 at 4, citing Skarren v. Household Fin Corp. , 296 AD2d 488 [2d Dept 2002].) But as Bristol itself admits (see id. at 5), the regular-policy-or-practice standard applies only to oral or implied contracts for severance payments—not the express agreement on which Corbett relies here. (See Bailey v. New York Westchester Sq. Med. Ctr. , 38 AD3d 119, 125 [1st Dept 2007].)
Finally, Bristol misplaces its reliance on Crest Hill Capital LLC v. Gonzalez (Index No. 652833/2018, 2019 WL 1557512 [Sup Ct, NY County Apr. 10, 2019] ). That decision does not consider the issue in this case—what terms are required for a severance agreement to be valid and enforceable. Rather, it addresses the distinct question of when courts will enforce non-compete provisions contained in a valid severance agreement. (See 2019 WL 1557512, at *5-*6.)
Bristol's motion to dismiss Corbett's breach-of-contract claim is denied.
Given this court's ruling that for pleading purposes the June 2012 letter constituted a valid and enforceable contract, Corbett's claim for unjust enrichment, which is based on the same facts and seeks the same damages, is dismissed as duplicative. (See Cox v. NAP Constr. Co., Inc. , 10 NY3d 592, 607-608 [2008].)
B. The Branch of Bristol's Motion Seeking Dismissal of Corbett's Labor Law Claim
In addition to her contracted-for severance compensation, Corbett has also asserted a claim for liquidated damages and attorney fees under Labor Law § 198. Bristol contends that this claim is barred by Labor Law § 198-c (3) because her salary at the relevant times exceeded $900 per week. This court agrees.
Corbett does not dispute that her salary exceeded § 198-c's $900/week threshold. Rather, she argues primarily that this threshold does not bar her claim because it applies only to claims brought under § 198-c, as opposed to claims brought under other provisions of Labor Law article 6. But Corbett's claim fits most naturally under § 198-c : that section expressly includes claims for an employer's failure or refusal to pay "separation pay." (See Labor Law § 198-c [1]-[2] ; Fraiberg v. 4Kids Entertainment, Inc. , 75 AD3d 580, 583 [2d Dept 2010] [construing a claim for the failure to pay a severance package as arising under § 198-c and holding it barred by § 198-c [3]'s $900/week threshold].)
Additionally, Corbett's complaint alleges merely that "Defendant's failure and refusal to pay Plaintiff her wage due in accordance with the terms of the Contract is in violation of NYS Labor Law § 190 et. seq. ", without identifying another operative provision of article 6 that Bristol allegedly violated. (NYSCEF No. 19 at 6.) Corbett's opposition to the motion to dismiss does not identify any such provision, either. At most, the opposition obliquely references Labor Law § 193, governing wage deductions. But that provision does not apply to an employer's refusal altogether to pay compensation, as Corbett alleges occurred here. (See Perella Weinberg Partners LLC v. Kramer , 153 AD3d 443, 449 [1st Dept 2017].) The motion to dismiss Corbett's Labor Law claim is granted.
Accordingly, it is hereby
ORDERED that Corbett's cross-motion for a default judgment under CPLR 3215 is denied; and it is further
ORDERED that the branch of Bristol's motion to dismiss under CPLR 3211 seeking dismissal of Corbett's breach of contract claim is denied; and it is further
ORDERED that the branch of Bristol's motion to dismiss under CPLR 3211 seeking dismissal of Corbett's unjust enrichment claim is granted; and it is further
ORDERED that the branch of Bristol's motion to dismiss under CPLR 3211 seeking dismissal of Corbett's Labor Law claim is granted.
ORDERED that as the parties shall confer and prepare a joint request for a status conference with this court to address the progress and scheduling of discovery, as set forth in the Remote Conference Protocol available on this court's website, http://ww2.nycourts.gov/courts/1jd/supctmanh/index.shtml.