Opinion
09-1178.
March 3, 2011.
Law Offices of Sean Doolan, Esq., Sean Doolan, Esq., Attorneys for Plaintiff, Windham, New York.
Murphy, Burns, Barber Murphy, LLP, James J. Burns, Esq., Attorneys for Defendant Village of Hunter, Albany, New York.
The Law Office of Mark A. Myers, Mark A. Myers, Esq., Attorneys for Raphael Klein and Gloria Klein, Albany, New York.
DECISION and ORDER
This declaratory judgment action arises from Plaintiff's contract with the Village of Hunter (hereinafter "Village"), made December 20, 2006 (hereinafter "Agreement"). Pursuant to the Agreement, Plaintiff furnished the Village with a well (hereinafter "Finn Well") for its municipal use, in exchange for the Village making its municipal water available for Plaintiff's condominium project. By Agreement Paragraph 3, Plaintiff further agreed to correct the Finn Well's adverse effects on surrounding property owners' wells. Plaintiff posted a cash bond with the Village to ensure its Paragraph 3 performance.
So denominated because such well was located on property owned by Sarah Finn, and the Agreement refers to it as the Finn Well.
The only adversely affected well at issue here is Raphael and Gloria Klein's (hereinafter "Kleins") well. It is uncontested that, when the Finn Well was tested the Kleins' well was adversely affected by the release of naturally occurring methane gas into its water. The Village's designated engineer proposed to install an air stripper (a holding tank which allows the methane to vent into the atmosphere prior to the Kleins' use of their water) to remediate the issue. Although Plaintiff agreed to pay for the air stripper out of the bond it posted, in accord with the Agreement, the Kleins have refused its installation.
According to the pleadings.
Plaintiff commenced this declaratory judgment action seeking a declaration that its obligations under Agreement Paragraph 3 have been fulfilled, with a corresponding release of their bond. The Village admitted all of the complaint's allegations, except it denied Plaintiff's allegation that it refused to release the bond. Issue was also joined by the Kleins, whose answer set forth a counterclaim and cross-claim seeking an order compelling Plaintiff and the Village to connect the Kleins' residence to the Village's municipal water system. Discovery has been conducted, is complete and a trial date certain has been set.
Plaintiff now moves for summary judgment on the declaration it seeks and dismissal of the Kleins' counterclaim. The Village opposes Plaintiff's motion, and similarly moves for summary judgment dismissing the Kleins' cross-claim. While the Kleins' oppose both Plaintiff's and the Village's summary judgment motions, they also move to amend their complaint, for summary judgment on their amended claim and for attorney's fees. Plaintiff and the Village oppose the Kleins' motion. Because Plaintiff failed to demonstrate its entitlement to the declaratory judgment it seeks, that portion of its motion is denied. Plaintiff and the Village, however, both demonstrated their entitlement to dismissal of the Kleins' counterclaim and cross-claim. While the Kleins failed to demonstrate their entitlement to any of the relief they seek.
Considering first the parties' summary judgment motions, "[s]ummary judgment is a drastic remedy that should not be granted where there is any doubt as to the existence of a triable issue." (Napierski v. Finn, 229 AD2d 869, 870 [3d Dept. 1996]).
It is well established that "the proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law" (Barra v. Norfolk Southern Ry. Co., 75 AD3d 821, 822 [3d Dept. 2010], quoting Winegrad v. New York Univ. Med. Ctr., 64 NY2d 851), "by proffering evidentiary proof in admissible form." (DiBartolomeo v. St. Peter's Hosp. of City of Albany, 73 AD3d 1326 [3d Dept. 2010]; Alvarez v. Prospect Hospital, 68 NY2d 320). If the movant establishes their right to judgment as a matter of law, the burden then shifts to the opponent of the motion to establish, by admissible proof, the existence of a genuine issues of fact. (Zuckerman v. City of New York, 49 NY2d 557). "The evidence is viewed in the light most favorable to the party opposing summary judgment." (Renwick v. Oneonta High School, 77 AD3d 1123, 1124 [3d Dept. 2010]).
As is applicable here, "[w]here an agreement is unambiguous on its face, it must be enforced in accordance with the plain meaning of its terms." (Vintage, LLC v. Laws Const. Corp., 13 NY3d 847, 849; Bell v. White, 77 AD3d 1241 [3d Dept. 2010]). Moreover, in interpreting a contract "[t]he entire contract must be reviewed and [p]articular words should be considered, not as if isolated from the context, but in the light of the obligation as a whole and the intention of the parties as manifested thereby. Form should not prevail over substance and a sensible meaning of words should be sought." (Riverside South Planning Corp. v. CRP/Extell Riverside, L.P., 13 NY3d 398, 404, quoting Atwater Co. v. Panama R.R. Co., 246 NY 519; Bailey v. Fish Neave, 8 NY3d 523).
The parties' respective positions arise, in large part, from Agreement Paragraph 3, which specifically states that:
"[Plaintiff] agrees to remediate any adverse conditions, at its sole cost and expense, which may be caused by the use of the water from the Finn Well by whatever means necessary. The remediation(s) includes, but is not limited to, drilling existing wells deeper or drilling new wells for wells with insufficient water due to the draw from the Finn Well or by installing filtration systems on wells with poor water quality, installing sleeves or otherwise addressing wells adversely affected by the introduction of methane gas. The number of wells that would be subject to remediation are to be limited to wells that the Village's designated engineer would reasonably identify as being directly impacted in terms of significant loss of water production or degradation of water quality by the Finn Well pumping at a maximum of thirty-three (33) gallons per minute, and whose owner(s) would provide or allow the collection of data to determine that this condition exists and consent to the recommended remediation procedures. [Plaintiff] shall pay all costs and expenses of aforesaid engineering determinations by the Village's designated engineer as mentioned above. All claims under this paragraph and requests for remediation must be made within eighteen (18) months after the Finn Well is connected to and available to be drawn into the Village water system."
Gleaning the intent of the parties from such provision and in light of the Agreement as a whole, the Agreement unambiguously requires Plaintiff to pay for only the remediation procedures the Village's designated engineer requires. The Agreement clearly conditions Plaintiff's obligation to pay for a remediation procedure upon the happening of three interrelated elements, to wit: 1. the Village's designated engineer reasonably identifying a particular well as being directly impacted by the Finn Well; 2. the impacted well's owner allowing the collection of data to determine the impact; and 3. that the impacted well's owner consents to the remediation procedure recommended by the Village's designated engineer. Each of these three elements must be met before Plaintiff's obligation to pay for the remediation arises. Notwithstanding the expansive obligation placed on Plaintiff by Paragraph 3's first sentence, such obligation is clearly and unequivocally "limited" by the Paragraph's later language. Moreover, such limitation is not restricted to determining only the "number" of wells to be remediated. Rather, Paragraph 3's "number" language, reasonably read in context, restricts only Plaintiff's obligation to remediate. Moreover, after Paragraph 3's "limit" language, such paragraph reiterates Plaintiff's obligation to pay for only those remediation "determinations [made] by the Village's designated engineer." A condition again set forth in Paragraph 5 of the Agreement.
Importantly, the Agreement contains no specific language that obligates Plaintiff or the Village to pay for a remediation procedure demanded by an affected well owner, but not recommended by the Village's designated engineer.
On this record, Plaintiff failed to demonstrate that all three Paragraph 3 limiting conditions have been fulfilled. Although it is uncontested that the Village's designated engineer reasonably identified the Klein well as being directly impacted by the Finn Well (element 1) and the Kleins' allowed the collection of data to determine the impact (element 2), Plaintiff failed to demonstrate element 3. Simply put, Plaintiff failed to establish that the Kleins "consent[ed] to the recommended remediation procedures." Rather, it is uncontested that the Kleins have, to date, rejected the Village designated engineer's recommendation. The Agreement, however, does not explicitly outline Plaintiff's obligations when an affected well owner rejects the Village designated engineer's remediation recommendation. As such, considering the evidence in a light most favorable to the Kleins, Plaintiff failed to demonstrate that the Kleins waived their ability to consent or that the Klein refusal fulfills Plaintiff's contractual obligation. As such, Plaintiff failed to demonstrate its entitlement to judgment as a matter of law.
Plaintiff and the Village did, however, establish their entitlement to dismissal of the Kleins' counterclaim and cross-claim as a matter of law. Considering the Kleins' Answer to Second Amended Complaint in a light most favorable, they set forth a property damage claim due to the Village's "unreasonable" interference with their subsurface waters.
"As to the use of percolating [subsurface] waters, a land owner has the right upon its own lands to make use of them as he reasonably can, even though he drain the spring upon his neighbor's premises . . . What is a reasonable use depends, of course, upon the particular facts of each case." (Friedland v. State, 35 AD2d 755 [3d Dept. 1970]; Forbell v. City of New York, 164 NY 522; People v. New York Carbonic Acid Gas Co., 196 NY 421).
Because, on this record, it is uncontested that the Plaintiff has not interfered with the Kleins' subsurface water, Plaintiff duly demonstrated its entitlement to judgment as a matter of law dismissing the Kleins' counterclaim.
Similarly, the Village established its entitlement to judgment by demonstrating the reasonableness of their subsurface water use. Supporting such reasonableness finding are: the affidavit of Alan Tavenner (hereinafter "Tavenner"), the Village's designated engineer, the affidavit of Joseph Myers (hereinafter "Myers"), the Village's Water Treatment Operator, and the affidavit of Mark Williams (hereinafter "Williams"), a geologist who conducted his own testing and examined the prior testing herein.
Such affidavits are considered in support of the Village's motion upon searching the record herein. (Miranda v. Norstar Building Corp., 79 AD3d 42 [3d Dept. 2010])
According to Myers, although the Finn Well has been run for testing it has not been run for the past two years and has never been used to supply Village residents with water. Nor is it planned to be used by the Village as a regular part of its municipal water supply. Instead, Myers alleges that the Finn Well is a "well of last resort" because of its high operational costs. It will only be used only in the case of a system wide drop in pressure. Such showing amply establishes that the Finn Well is neither currently adversely affecting the Klein well, nor is it planned on adversely affecting the Kleins' well. It is merely a "last resort" backup water supply to service the entire municipality at a time of emergency need. As such, in this context, the Village's ownership and limited use of the Finn Well as a backup water source for its residents is a reasonable use of their subsurface waters.
The reasonableness of the Village's use is further bolstered by its proposal to remediate the Finn Well's effects on the Kleins' well. The Williams and Tavenner affidavits both discuss the proposed air stripper as a viable, cost effective, method of resolving the Kleins' methane issue. On this record, no expert proof is offered contradicting the viability of the proposed air stripper and Mr. Klein's unsupported objections fail to raise a triable issue of fact on this issue.
Considering the Village's limited water use in light of their proposed remedial measure, the Village demonstrated, as a matter of law, the reasonableness of their use and their corresponding entitlement to dismissal of the Kleins' cross-claim.
Turning next to the Kleins' motion to amend their answer, it is denied because they failed to demonstrate the merit of their proposed amendment.
It is well established that "[l]eave to amend pleadings is freely granted (see CPLR 3025[b]) so long as there is no prejudice to the nonmoving party and the amendment is not plainly lacking in merit." (Paolucci v. Mauro, 74 AD3d 1517, 1519 [3d Dept. 2010], quoting Shelton v. New York State Liq. Auth., 61 AD3d 1145 [3d Dept. 2009][internal quotation marks omitted]). "In determining the merit of the proposed amendment, [the Court] must accept as true the facts alleged and draw all reasonable inferences in favor of [the movant]." (Shelton, supra at 1150).
The Kleins' seeks to add a "specific performance" counter-claim and cross claim to their answer. Such claim is premised upon the Kleins' allegation that they are third party beneficiaries to the Agreement. Accepting such factual allegation as true, the Kleins' rights under the Agreement must be determined. Under no reasonable interpretation of the Agreement's language, however, are the Kleins entitled to the specific performance they seek. As set forth above, the Agreement specifically limits Plaintiff's remediation obligation to those corrective acts recommended by the Village's designated engineer. The Kleins, however, have refused such recommended action. Moreover, no reasonable interpretation of the Agreement provides the Kleins with the ability to demand a specific remediation procedure, upon which their specific performance claim depends. Nor does the Agreement obligate the Village to perform any specific remediation procedure.
Accordingly, because the Kleins wholly failed to demonstrate the merit of their proposed specific performance amendment, their motion is denied.
Relatedly, because the Kleins' motion for summary judgment was wholly dependent upon their amended answer, it too is denied. Similarly, because of the result herein the Kleins wholly failed to demonstrate their entitlement to attorneys' fees.
This Decision and Order is being returned to the attorneys for the Village. A copy of this Decision and Order and all other original papers submitted on this motion are being delivered to the Greene County Clerk for filing. The signing of this Decision and Order shall not constitute entry or filing under CPLR § 2220. Counsel is not relieved from the applicable provision of that section respecting filing, entry and notice of entry.
So Ordered.
PAPERS CONSIDERED:
1. Notice of Motion dated, December 16, 2010; Affirmation of Sean Doolan, dated December 15, 2010, with attached Exhibits A-D; Statement of Sean Doolan, dated December 15, 2010, with attached Exhibits A-L.
2. Notice of Cross Motion, dated January 27, 2011; Affirmation of Mark Myers, dated January 27, 2011; Affidavit of Raphael Klein, dated January 27, 2011, with attached Exhibit A.
3. Notice of Cross Motion, dated January 28, 2011; Affidavit of James Burns, dated January 28, 2011, with attached Exhibits A-B.
4. Affidavit of James Burns, dated February 4, 2011, with attached Exhibit A; Affidavit of Alan Tavenner, dated February 3, 2011, with attached Exhibit A.
5. Affirmation of Sean Doolan, dated February 3, 2011.
6. Affirmation of Mark Myers, dated February 4, 2011.
7. Affidavit of James Burns, dated February 10, 2011.
8. Affidavit of James Keefe, dated January 27, 2011, with attached unnumbered exhibits.