PAMELA K. CHEN, District Judge.
Plaintiff Acranom Masonry, Inc. ("Acranom") brings this action against Defendant Wenger Construction Co., Inc. ("Wenger") seeking compensation for work that Acranom performed, as a subcontractor to Wenger, on a construction project commissioned by the New York City School Construction Authority ("SCA"). Before the Court is Defendant's motion for partial summary judgment. For the reasons stated below, Defendant's motion is granted in part and denied in part.
In February 2011, Wenger submitted a bid to the SCA for a contract to complete a construction project at a public school in Brooklyn, New York (the "Project"). (Affidavit of David Wenger ("Wenger Aff.")
Acranom submitted a price quote to Wenger for the masonry work on or around March 29, 2011. (See Dkt. 32-12.) On March 30, 2011, evidently after a phone call with a representative of Wenger, an Acranom project manager, Anthony Stewart, sent Wenger an email to update Acranom's price quote to reflect the following additions: (i) "Paint removal and gr[a]ffit[i] paint cost 212,000"; and (ii) "Brick replacement 65 per ft 18000 × 65 equals[ ] 1,170,000." (Dkt. 32-12 at ECF
On or around April 18, 2011, the SCA officially awarded the Project to Wenger. (Dkt. 32-10 at 7.) The SCA and Wenger entered into a contract (the "Prime Contract") that established, among other things, the scope of the Project, the terms and conditions of Wenger's completion of the Project, and a contract price of $4,269,000. (Dkt. 32-10; Dkt. 39 at ECF 50-111.) Two days later, on April 20, 2011, Wenger's President, David Wenger, sent a letter to Acranom, notifying Acranom that "Wenger will proceed with drafting a contract for the work based upon your March 29, 2011 quote . . . and subsequent March 30, 2011 e-mail confirming the 18000 square foot brick removal/replacement provision unit cost of 65/ sq.ft. The total contract cost will be $1,960,000.00." (Dkt. 32-13.)
On May 2, 2011, Acranom project manager Anthony Stewart sent an email to David Wenger regarding the cost of a performance bond for the work that Acranom would perform for Wenger. (Dkt. 32-18.) In the email, Stewart stated that "the cost of the Bond for 100% of the contract value . . . is $23,769." (Id.)
On or around May 5, 2011, Wenger and Acranom entered into a subcontract (the "Subcontract") under which Acranom undertook to perform certain obligations, including the completion of certain masonry work, in exchange for a total price of $1,960,000. (Dkt. 32-14.)
(Dkt. 32-14 (Subcontract) Art. 1.)
Rider A also contains a section titled "Unit Prices, Allowances, Alternates and Provisions." (Dkt. 32-14 (Subcontract) at 17.) That section states, in relevant part:
(Id.) But that section does not specify a unit price for the brick removal and replacement, nor does any other provision of Rider A or the Subcontract. (See generally Dkt. 32-14 (Subcontract).)
(Dkt. 32-14 (Subcontract) Art. 19.)
(Dkt. 32-14 (Subcontract) Art. 20.)
(Dkt. 32-14 (Subcontract) Art. 20.)
(Dkt. 32-14 (Subcontract) Art. 31.)
With the Project underway,
On or around October 8, 2012, Wenger transmitted to Acranom a written Change Order form bearing Wenger's letterhead ("October 8, 2012 Change Order"). The October 8, 2012 Change Order purported to make the following "modification" to the Subcontract: "Deletion and addition of all labor, materials, tools, accessories, equipment and appliances as indicated in NOD 00004, for deletion of 15,900 SF of brick replacement under Contract Provision #1." (Dkt. 32-16.) The Charge Order specified that the "Total Cost of work" for the Change Order was negative $540,000, which signified a "credit" to Wenger in the amount of $540,000. (Id.) Near the bottom, the Change Order stated: "SIGN BELOW AND RETURN BOTH COPIES FOR SIGNATURE." (Id.) An Acranom representative signed the October 8, 2012 Change Order on October 11, 2012 and returned the order to Alex Cardinale, a project manager at Wenger. (Dkt. 32-16; Wenger Aff., Dkt. 32-9, ¶ 10.) Cardinale then forwarded the Change Order to David Wenger, Wenger's President. (Wenger Aff., Dkt. 32-9, ¶ 10.) David Wenger did not sign the October 8, 2012 Change Order because he believed that Wenger's credit for elimination of 15,900 square feet from the scope of Acranom's brick removal work should be calculated based on the $65-per-square-foot unit price that was quoted by Acranom project manager Anthony Stewart in his March 30, 2011 email, rather than the effective rate of $35 per square foot in the Change Order. (Id.)
Sometime later during the Project,
Contrary to the requirements of Article 27(B)(2) of the Subcontract, Acranom did not provide Wenger with payment and performance bonds prior to entry into the Subcontract. (Pl.'s 56.1 Response, Dkt. 40, ¶ 11.) Acranom also did not provide Wenger with payment and performance bonds at any time during the course of the Project. (Pl.'s 56.1 Response, Dkt. 40, ¶ 11.)
Acranom claims to have completed numerous items of "extra" work on the Project for which it was never compensated. Acranom asserts that, for each item of extra work, it prepared a Proposed Change Order ("PCO") for submission to Wenger.
Over the course of the Project, Wenger issued eight checks to Acranom totaling $540,102. (Wenger Aff., Dkt. 32-9, ¶ 22; Pl.'s 56.1 Response, Dkt. 40, ¶ 42.) Upon receipt of each of these payments, Acranom signed a separate "Partial Waiver and Release of Lien," which, in relevant part, provided:
(Dkt. 39, Ex. 12, at ECF 130, 135, 142, 150, 157, 163, 165.) Acranom signed the last of these releases on June 20, 2013. (Dkt. 39, Ex. 12, at ECF 130.)
In addition to the payments that Wenger made to Acranom, Wenger also made the following payments, totaling $56,022.92, to certain of Acranom's suppliers and creditors on Acranom's behalf: (1) $45,268.72 to the Mason Tenders Trust Fund; (2) $7,591 to RKL Building; (3) $3,062 to Glenwood Mason Supply; and (4) $101.20 to E&E Equipment. (Def.'s 56.1 Stmt., Dkt. 33, ¶¶ 17-20.)
Acranom commenced this action on March 21, 2014. (Dkt. 1.) After the close of discovery, the parties appeared for a pre-motion conference concerning Wenger's intention to file a motion for summary judgment and a motion for leave to amend its answer to add a counterclaim against Acranom based on events that had occurred during the pendency of the litigation. (Dkt. 25.) With the Court's leave, Acranom filed an amended complaint ("Amended Complaint") on July 15, 2016, and Wenger filed an amended answer, with its new counterclaim, on July 29, 2016. (Dkts. 26, 27.) On November 21, 2016, Wenger filed the present motion for partial summary judgment on three issues related to Plaintiff's claims in the Amended Complaint. (Dkt. 32.)
Summary judgment is appropriate where the submissions of the parties, taken together, "show[] that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a); see Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986) (summary judgment inquiry is "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law"). A dispute of fact is "genuine" if "the [record] evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248.
The initial burden of "establishing the absence of any genuine issue of material fact" rests with the moving party. Zalaski v. City of Bridgeport Police Dep't, 613 F.3d 336, 340 (2d Cir. 2010). Once this burden is met, however, the burden shifts to the nonmoving party to put forward some evidence establishing the existence of a question of fact that must be resolved at trial. Spinelli v. City of N.Y., 579 F.3d 160, 166-67 (2d Cir. 2009); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). A mere "scintilla of evidence" in support of the nonmoving party is insufficient; "there must be evidence on which the jury could reasonably find for the [nonmovant]." Hayut v. State Univ. of N.Y., 352 F.3d 733, 743 (2d Cir. 2003) (quotation omitted; alteration in original). In other words, "[t]he nonmoving party must come forward with specific facts showing that there is a genuine issue for trial." Caldarola v. Calabrese, 298 F.3d 156, 160 (2d Cir. 2002) (quotation omitted; emphasis in original).
In determining whether a genuine issue of fact exists, the court must resolve all ambiguities and draw all reasonable inferences against the moving party. Major League Baseball Props., Inc. v. Salvino, Inc., 542 F.3d 290, 309 (2d Cir. 2008). The Court also construes any disputed facts in the light most favorable to the nonmoving party. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 157-59 (1970). However, "the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment. . . ." Anderson, 477 U.S. at 247-48 (emphasis in original).
In its motion for summary judgment, Wenger asks the Court to rule as a matter of law that (1) Wenger is entitled to a credit of $1,150,000 for elimination of face brick removal work from the Subcontract, (2) Wenger is entitled to a credit of $23,769 for Acranom's failure to provide payment and performance bonds as required by the Subcontract, (3) Acranom's claims for extra work denominated as PCOs ##5, 6, 7, 8, 9, 11, 12, 13, and 14 are barred by the Subcontract and fail as a matter of law, and (4) Wenger is entitled to a credit of $596,125.86 for payments made to Acranom or third parties on behalf of Acranom. The Court addresses each prong of Wenger's motion in turn.
As initially executed, the Subcontract required Acranom to perform, among other things, "approximately 18,000 [square feet]" of face brick removal and replacement. During the course of the Project, however, Wenger and the SCA twice amended the scope of the Project to eliminate face brick removal, resulting in the elimination of 17,700 square feet of face brick removal. To account for the elimination of that work, the SCA received a combined credit of approximately $621,952 on the Prime Contract.
Under New York law,
Here, the Subcontract contains a broad merger clause, which states that the Subcontract "comprises the full and entire agreement between the parties" concerning Acranom's work under the Subcontract, and that "[n]o other agreement or understanding of any nature concerning the same has been entered into or will be recognized." (Dkt. 32-14 (Subcontract) Art. 31.) This clause "require[s] full application of the parol evidence rule" to exclude any extrinsic evidence that would "alter or add a provision to a written agreement." Schron, 986 N.E.2d at 433-34. Accordingly, to assess the first prong of Wenger's motion—i.e., Wenger's claim for a $1,150,000 credit for the elimination of 17,700 square feet of face brick removal from the scope of the Project—the Court first considers the plain meaning of the Subcontract and considers extrinsic evidence only as necessary to cure ambiguities that are apparent from the face of the Subcontract.
A contract is ambiguous "if it is reasonably susceptible of more than one interpretation . . . [as] determin[ed] by reference to the contract alone." Burger King Co. v. Horn & Hardart Co., 893 F.2d 525, 527 (2d Cir. 1990). To determine whether the Subcontract is ambiguous as to Wenger's credit for the eliminated face brick removal work, the Court has considered the Subcontract as a whole, giving its terms their plain and ordinary meaning.
The Court's analysis begins with Article 3 of the Subcontract, which states that "[Wenger] agrees to pay [Acranom] for the work described [in Article 2 and Rider A], the total price of $1,960,000." (Dkt. 32-14 (Subcontract) Art. 3.) In addition to stating a "total price" for the full scope of work defined in the Subcontract, Article 3 also contemplates that there could be additions or deductions to both the scope and price of the Subcontract: "Payment of this amount is subject to additions or deductions within the provisions of this Subcontract and of the other documents to which [the] Subcontract is subject." (Id.) Article 3 of the Subcontract does not indicate, however, which "provisions of [the] Subcontract" or what "other documents to which this Subcontract is subject" establish the method for adjusting the Subcontract's price based on changes to its scope. (Id.)
Acranom urges the Court to find this answer in Article 4 of the Subcontract.
As a fallback, Acranom argues that Wenger's credit for the elimination of face brick removal from the Project must be determined "pursuant to the `[Prime] Contract' between Wenger and the [SCA]" because the Prime Contract was incorporated into the Subcontract via Article 1. (Pl.'s Br. at 5; see also Dkt. 32-14 (Subcontract) Art. 1 ("The [Prime Contract] . . . and all other documents by reference forming a part of the [Prime Contract] between the [SCA] and [Wenger] are hereinafter collectively referred to as the `General Contract', which is made a part hereof. . ..").) Acranom points, in particular, to Article 7 of the Prime Contract, which provides:
(Dkt. 39, Ex. 4 (Prime Contract), at ECF 72 § 7.01.) The Court finds, however, that these provisions of the Prime Contract, like Articles 3 and 4 of the Subcontract, do not unambiguously specify how to compute Wenger's credit for the elimination of brick removal work from the Project; instead, they address one permissible method for the SCA to adjust the contract price of the Prime Contract. It is ambiguous, however, whether these provisions apply only to the SCA's credits under the Prime Contract, or also apply to Wenger's credits under the Subcontract by virtue of the Subcontract's incorporation of the Prime Contract as "a part [of]" the Subcontract itself. (Dkt. 32-14 (Subcontract) Art. 1.)
In addition to the provisions on which Acranom relies in its memorandum, the Court also considers the significance of a provision contained in Rider A of the Subcontract. Rider A contains a section titled "Unit Prices, Allowances, Alternates and Provisions." (Dkt. 32-14 (Subcontract) at 17.) That section states, in relevant part:
(Id.) Both parties agree that this section of the contract does not specify a unit price for the "Provision" of the Subcontract calling for the removal and replacement of approximately 18,000 square feet of face brick. (Def.'s Reply (Dkt. 35) at 3; Pl.'s Br. at 5.) Nonetheless, the Court observes that this section of the contract may be relevant to interpreting the ambiguities identified above in Articles 1 and 4 of the Subcontract. For example, by stating that "No Provision is authorized to be commenced or performed . . . [without] a written construction authorization," this section appears to make Acranom's face brick removal work a provisional—i.e., contingent—part of the Subcontract. But, as noted above, Article 3 of the Subcontract specifies a "total price" that assumes Acranom's performance of all of the work described in Rider A, including the provisional work, and neither Article 3 nor Rider A specifies the value of the Subcontract without this provisional work. Thus, even assuming that Rider A unambiguously designates the brick removal work as provisional—i.e., contingent— the Subcontract nonetheless fails to specify unambiguously the method by which to determine the price of Acranom's partial performance of that provisional work.
In summary, the Court finds that Article 1, Article 3, Article 4, and Rider A of the Subcontract are potentially relevant to the determination of Wenger's credit for the elimination of 17,700 square feet of face brick removal from the scope of the Project. However, due to ambiguities in those provisions, as described above, the Court is unable to determine the proper method for calculating Wenger's credit without consideration of extrinsic evidence.
Having found material ambiguities in the Subcontract, the Court may consider extrinsic evidence to cure those ambiguities, except that extrinsic evidence cannot be introduced to "alter or add a provision to a written agreement." Schron v. Troutman Sanders LLP, 986 N.E.2d 430, 433-34 (N.Y. 2013). The admission of extrinsic evidence to cure ambiguities in a complete written agreement is an act of contract interpretation, not contract reformation. See Collins v. Harrison-Bode, 303 F.3d 429, 433-35 (2d Cir. 2002); Am. Home Assur. Co. v. Merck & Co., 329 F.Supp.2d 436, 444 (S.D.N.Y. 2004). The decision to admit extrinsic evidence does not give a court unlimited discretion to "add or excise terms" from the agreement, "nor [to] distort the meaning of those used and thereby make a new contract for the parties under the guise of interpreting the writing." Bailey v. Fish & Neave, 868 N.E.2d 956, 959 (N.Y. 2007) (quotation omitted). Rather, the court considers the extrinsic evidence for the limited purpose of resolving a specific ambiguity in the written agreement. See Tom Doherty Assocs., Inc. v. Saban Entm't, Inc., 60 F.3d 27, 36 (2d Cir. 1995) ("Extrinsic evidence is admissible only to resolve conflicting, plausible interpretations that straddle the ambiguity of a word.").
Here, Wenger points to three pieces of extrinsic evidence to support its proposal to use a unit price of $65 per square foot to calculate its credit for elimination of brick removal from the Subcontract. First, in a pre-contract email dated March 30, 2011, an Acranom project manager provided a price quote to Wenger that was based on, among other things, a unit price of $65 per square foot for 18,000 square feet of face brick replacement. (Dkt. 32-12 at ECF 2.) Second, in a letter dated April 20, 2011, David Wenger notified Acranom that Wenger would "proceed with drafting a contract for the work based upon [Acranom's] March 29, 2011 quote . . . and subsequent March 30, 2011 e-mail confirming the 18000 square foot brick removal/replacement provision unit cost of 65/ sq.ft." (Dkt. 32-13.) Third, according to Wenger, "Acranom's corporate designee . . ., Salvatore Monarca, readily conceded at his deposition that Acranom's regular practice is to credit a customer for omitted work based on the bid value of the work." (Def.'s Br. at 6.)
The problem with Wenger's proposed extrinsic evidence is that it does not address any of the contract ambiguities, described above, that prevent the Court from determining Wenger's credit based solely on the terms of the Subcontract. See Saban Entm't, 60 F.3d at 36 (extrinsic evidence is admissible only to cure specific ambiguities in a written agreement). The proposed evidence does not provide any information on the parties' intentions as to the incorporation provisions of Article 1 of the Subcontract, nor does it elucidate the meaning of the payment provisions of Articles 3 and 4 of the Subcontract. Indeed, the disconnect between Wenger's extrinsic evidence and the Subcontract's ambiguities is not surprising, given that Wenger does not acknowledge that any such ambiguities exists. (See generally Def.'s Br.; Def.'s Reply.)
Wenger, however, argues that its proffered extrinsic evidence should be considered "to complete" the Subcontract on a "critical" question on which the Subcontract is "silent." (Def.'s Reply at 3.) Wenger argues that "[w]here . . . a valid contract is incomplete, extrinsic evidence is admissible to complete the writing if it is apparent from an inspection of the writing that all the particulars of the agreement are not present and that the evidence offered does not vary or contradict the writing." (Def.'s Reply at 3.)
To be sure, the Second Circuit stated in In re World Trade Ctr. Disaster Site Litig. ("In re World Trade Ctr."), that "an omission as to a material issue can create an ambiguity," which may be resolved by extrinsic evidence, "where the context within the document's four corners suggests that the parties intended a result not expressly stated." 754 F.3d 114, 122 (2d Cir. 2014) (quoting Hart v. Kinney Drugs, Inc., 67 A.D.3d 1154, 1156 (N.Y. App. Div. 2009)).
Nonetheless, looking ahead to trial, the Court discerns two narrow paths by which Wenger may be able to introduce its proffered evidence. The first path is through Article 4 of the Subcontract. As noted above, Article 4 provides, among other things, that Wenger would pay Acranom for "items of work . . . on the basis of ninety-five (95%) percent of the value of [Acranom's] items of work at the prices stipulated." (Dkt. 32-14 (Subcontract) Art. 4 (emphasis added).) To the extent the phrase "at the prices stipulated," which the Court finds ambiguous, is proved to refer to prices "stipulated" between Wenger and Acranom, Wenger would be permitted to introduce evidence of the prices "stipulated" between Wenger and Acranom, which may potentially include the extrinsic evidence that Wenger offers here. The Court does not consider the evidence at this stage, however, where the record evidence is insufficient to resolve the facial ambiguity in Article 4 in Wenger's favor.
The second potential path for Wenger's extrinsic evidence is based on the background principles of common law that may potentially come into play in this action, depending on the evidence produced at trial. Given the Subcontract's failure to unambiguously establish the method by which to compute Wenger's credit for the elimination of face brick removal work from the Project's scope, the Court or a jury may find that the parties simply did not reach a meeting of the minds as to that method. In that scenario, the Court or a jury would need to determine whether, in the absence of a mutual agreement concerning the method for computing Wenger's credit, the parties can nonetheless be said to have reached agreement on all material terms of the Subcontract. See Madeira v. Affordable Hous. Found., Inc., 469 F.3d 219, 252-53 (2d Cir. 2006) ("Few principles are better settled in the law of contracts than the requirement of definiteness. If an agreement is not reasonably certain in its material terms, there can be no legally enforceable contract." (quoting Cobble Hill Nursing Home, Inc. v. Henry & Warren Corp., 548 N.E.2d 203, 206 (N.Y. 1989)). Although a ruling on that issue is premature at this time, the Court observes that the method for computing Wenger's credit appears to be an integral part of the price term of the Subcontract, which is presumably a material term of the agreement. See Tufano v. Morris, 286 A.D.2d 531, 534 (N.Y. App. Div. 2001) ("It is well settled that the price to be paid under a contract is a material term." (quotation omitted)). Thus, if the parties are determined to have failed to reach an agreement on the method for computing Wenger's credit—which seems possible given the current record—they might not have an enforceable contract at all. See KJ Roberts & Co. v. MDC Partners, 605 F. App'x 6, 7 (2d Cir. 2015) (affirming dismissal of breach of contract claim because "the parties never agreed to a material term . . . namely, the `Adjustments' to be applied in order to calculate [an] incentive payment"). In that scenario, extrinsic evidence, including potentially the extrinsic evidence that Wenger has offered here, might be admitted in order to salvage the Subcontract based on a mutual mistake not to include a price-adjustment unit price, see N.Y. First Ave. CVS, Inc. v. Wellington Tower Assocs., 299 A.D.2d 205, 205-06 (N.Y. App. Div. 2002); Barash v. Pa. Terminal Real Estate Corp., 256 N.E.2d 707, 712 (N.Y. 1970), or to resolve Acranom's claims against Wenger in non-contract terms, such as quantum meruit or unjust enrichment, see Hudson & Broad, Inc. v. J.C. Penny Corp., 553 F. App'x 37, 40-41 (2d Cir. 2014).
The Subcontract does not unambiguously specify the method by which to calculate Wenger's credit for the elimination of 17,700 square feet of face brick removal from the scope of the Project. Several provisions of the Subcontract—namely, Article 1, Article 3, Article 4, and Rider A—are potentially relevant to this issue, but the extrinsic evidence that Wenger seeks to introduce is insufficient to cure the ambiguities in those provisions as a matter of law. Further, the extrinsic evidence is not admissible to cure a supposed "silence" in the Subcontract separate and apart from a contractual ambiguity that appears from the face of the Subcontract.
Wenger asks the Court to rule that Wenger is entitled to a credit of $23,769 for Acranom's failure to provide payment and performance bonds as required by the Subcontract. Article 27(B)(2) of the Subcontract provides that "[Acranom was required] to provide[ ] acceptable 100% Payment & Performance Bonds (prerequisite for payment)." (Dkt. 32-14 (Subcontract) Art. 27(B).) Acranom concedes that, contrary to this requirement, Acranom did not provide Wenger with payment and performance bonds prior to entry into the Subcontract. (Pl.'s 56.1 Response, Dkt. 40, ¶ 11.) Acranom also did not provide Wenger with payment and performance bonds at any time during the course of the Project. (Pl.'s 56.1 Response, Dkt. 40, ¶ 11.)
In their memoranda, the parties argue mainly about whether Wenger waived the payment and performance bond requirement through its conduct. (Def.'s Br. at 8; Pl.'s Br. at 9-11; Def.'s Reply at 5-7.) But these arguments are beside the point. Even assuming that Wenger retains a right to enforce the bond requirement, Wenger's motion for a credit of $23,769 has no grounding in the law. To be sure, a breach-of-contract defendant may claim recoupment or setoff
Wenger asks the Court to dismiss all of Acranom's claims for extra work denominated as PCOs ##5, 6, 7, 8, 9, 11, 12, 13 and 14. For the following reasons, the Court grants this prong of Wenger's motion in its entirety.
Wenger claims that all of Acranom's claims for extra work are barred by Article 19 of the Subcontract. Article 19 provides, in relevant part, that the Subcontract price "represents the full consideration" for Acranom's work under the Subcontract, that "in no event shall there be any claims for `extras'," and that "[a]ny changes, modifications or extension of the work to be performed herein may only be done by written order executed by [Acranom] and by an officer of [Wenger]." (Dkt. 32-14 (Subcontract) Art. 19.) According to Wenger, Article 19 bars any claim for extra work that was not expressly authorized by a written order executed by Acranom and an officer of Wenger. (Def.'s Br. at 9; Wenger Aff., Dkt. 32-9, ¶ 10.)
The bar on extra work imposed by Article 19 is qualified by Article 20(a), which provides a procedure for addressing disagreements between Wenger and Acranom about "extra" work performed by Acranom during the Project. In relevant part, Article 20(a) provides that Acranom was not barred from recovering for extra work performed on the Project, so long as Acranom kept "complete and acceptable time and material records of its actual costs in performing said work and present said records to a duly authorized representative of [Wenger] on a daily basis for signature." (Dkt. 32-14 (Subcontract) Art. 20.) Reading Article 19 and 20(a) together, the Court finds that Article 20(a) covers Acranom's claims for extra work to the extent that Acranom and Wenger disagreed then, and disagree now, about whether the work that Acranom performed qualifies as "extra" work, as opposed to work within the scope of the Subcontract. Of course, this means that Article 20(a) applies to the bulk of Acranom's claims, as discussed below.
Article 20(b) of the Subcontract is also relevant to Acranom's claim for extra work based on PCO #14. That provision states, in relevant part, that Acranom waives the right to recover on any "claim[] for damages because of any claimed default, breach, delay, interference, act or omission of [Wenger]," unless Acranom gave adequate written notice of the claim to Wenger "within five (5) days after the occurrence of such act or omission." (Dkt. 32-14 (Subcontract) Art. 20.)
With the exception of PCO #14, which relates to a claim for damages based on project delays, all of Acranom's claims based on "extra" work are subject to the recordkeeping and notice requirements of Article 20(a). Under those requirements, to have any claim of recovery for extra work, Acranom was obligated to keep "complete and acceptable time and material records of its actual costs in performing said work and present said records to a duly authorized representative of [Wenger] on a daily basis for signature." (Dkt. 32-14 (Subcontract) Art. 20.)
The Court finds as a matter of law that Article 20(a) of the Subcontract bars Acranom from recovering on PCOs ##5, 6, 7, 8, 12, and 13. For each of those PCOs, Acranom has failed to adduce any evidence that it sent Wenger a copy of its time and material records "on a daily basis" for Wenger's signature. See supra (summarizing record evidence related to Acranom's PCOs).
However, the Court finds that the Subcontract does not bar Acranom's extra-work claims based on PCOs ##9 and 11. For each of those PCOs, Acranom generated a written form stating that Acranom was "authorized to perform this additional work, which Acranom Masonry, Inc. will be compensated for[,]" and each of those forms was signed by Chris Carpentieri, a Wenger representative. (Monarca Aff., Dkt. 39, ¶ 81; Dkt. 39, Ex. 21, at ECF 190; Monarca Aff., Dkt. 39, ¶ 83; Dkt. 39, Ex. 22, at ECF 192.) Accordingly, PCOs ##9 and 11 are not subject to Article 20(a) because Wenger conceded, in a writing signed by a Wenger representative, that the work performed thereunder by Acranom was "extra" work.
This leaves PCO #14, under which Acranom seeks to recover $77,099 in "added labor costs resulting from Wenger's failure to provide the contractually required `heat' to the project." (Dkt. 39, Ex. 26, at ECF 201.) The Court finds that this claim is barred by Article 20(b) because Acranom has not submitted evidence showing that it provided Wenger written notice of this extrawork claim "within five (5) days after the occurrence of such act or omission." (Dkt. 32-14 (Subcontract) Art. 20(a).) Acranom also has failed to identify any provision of the Subcontract that Wenger breached by allegedly failing to provide "water, electrical service and heat" for Acranom's workers.
As an additional ground for dismissal of the extra-work claims, Wenger contends that each of Acranom's claims for extra work is barred by one or more written releases. (Def.'s Br. at 9-17.) Over the course of the Project, Wenger issued eight checks to Acranom for a total of $540,102. (Wenger Aff., Dkt. 32-9, ¶ 22; Pl.'s 56.1 Response, Dkt. 40, ¶ 42.) Upon receipt of each of these payments, Acranom signed a separate "Partial Waiver and Release of Lien," which, in relevant part, stated that "[Acranom] does hereby waive and release all . . . claims . . . on the monies or other consideration due or to become due from Wenger Construction Co., Inc., [and] [t]he [SCA]. . . for [the Project] on account of labor or materials or both furnished, on account, for the premises known as PS 86 of which the undersigned [Acranom] is the Supplier or Subcontractor or Consultant as per [the Subcontract] and change orders on said premises." (Dkt. 39, Ex. 12, at ECF 130, 135, 142, 150, 157, 163, 165.) The last of these releases was signed by Acranom on June 20, 2013. (Dkt. 39, Ex. 12, at ECF 130.)
"A release is a contract, and its construction is governed by contract law." Kulkarni v. Arredonda & Co., 151 A.D.3d 705, 706 (N.Y. App. Div. 2017) (quotation omitted); accord Bihag v. A&E Television Networks, LLC, 669 F. App'x 17, 18 (2d Cir. 2016) ("Under New York law, general releases are governed by principles of contract law."). Accordingly, "a release that is complete, clear, and unambiguous on its face must be enforced according to the plain meaning of its terms." Kulkarni, 151 A.D.3d at 706 (brackets and quotation omitted).
Applying these principles, the Court finds that each of the partial lien waivers is a complete, clear, and unambiguous release of all claims for compensation for work performed on the Project before the date of the release, whether the work was under the Subcontract or "change orders." (Dkt. 39, Ex. 12, at ECF 130.) The cases cited by Acranom on this point (Pl.'s Br. at 17-20) are easily distinguishable. In many of those cases, the language used in the releases in question, unlike the language in the partial lien waivers here, did not clearly and unambiguously cover "all . . . claims . . . on the monies or other consideration due" for work performed on the project. See Navillus Tile v. Turner Constr. Co., 2 A.D.3d 209, 210-11 (N.Y. App. Div. 2003) (releases were "expressly limited . . . to the extent of, and as covered by, payments actually received by the [subcontractor]" (emphasis in original)); Orange Steel Erectors, Inc. v. Newburgh Steel Prods., Inc., 225 A.D.2d 1010, 1011-12 (N.Y. App. Div. 1996) (releases were limited acknowledgement of "partial" payment and "renounce[d] only plaintiff's claims `upon the land and or buildings' of the project"). The other cases declined to enforce partial waivers where the parties' course of conduct demonstrated that the releases were not intended to extinguish the subcontractor's right to receive additional payments for work covered by the scope of the releases. See W. End Interiors, Ltd. v. Aim Constr. & Contracting Corp., 286 A.D.2d 250, 252 (N.Y. App. Div. 2001); Apollo Steel Corp. v. Sicolo & Massaro, Inc., 300 A.D.2d 1021, 1021-22 (N.Y. App. Div. 2002); Macquesten Gen. Contracting, Inc. v. HCE, Inc., 128 F. App'x 782, 784-85 (2d Cir. 2005). However, those cases lend no support to Acranom here, where Acranom has failed to adduce evidence showing that Wenger and Acranom both intended for Acranom to receive additional payments for work performed prior to the execution of each of the partial releases. Acranom's conclusory assertion that Wenger routinely "approved change orders for work performed in prior months, including . . . prior [to the] execut[ion] [of a] partial lien waiver" (Monarca Aff., Dkt. 39, ¶ 99) is not substantiated by anything in the record and, standing alone, is insufficient to overcome the plain terms of the written releases. See Fed. R. Civ. P. 56(e) (party opposing summary judgment "must set forth specific facts showing that there is a genuine issue for trial" (emphasis added)); Patterson v. Cty. of Oneida, 375 F.3d 206, 219 (2d Cir. 2004) ("No[] . . . genuine issue [is] created merely by the presentation of assertions that are conclusory."). Acranom also cannot overcome the plain terms of the releases based on Wenger's conduct in July 2014; (see Monarca Aff., Dkt. 39, ¶ 101), given that Acranom had not signed a partial waiver for that period. See supra (last waiver signed June 20, 2013). Thus, each of Acranom's "extra work" claims that accrued prior to June 20, 2013;—i.e., PCOs ## 5, 6, 7, 8, 9, 11, and 14—is barred by one or more partial lien waivers.
In summary, all of Acranom's claims for extra work fail as a matter of law on one or more grounds, as more fully explained above. Accordingly, the Court grants the third prong of Wenger's motion in its entirety.
Wenger also seeks a summary judgment finding that Wenger is entitled to a credit of $596,125.86 for payments made to Acranom or third parties on behalf of Acranom. The Court easily grants this prong of Wenger's motion. Acranom does not dispute that Wenger made payments to Acranom under the Subcontract totaling $540,102. (Wenger Aff., Dkt. 32-9, ¶ 22; Pl.'s 56.1 Response, Dkt. 40, ¶ 42.) The record further shows that Wenger made the following payments to third-party creditors of Acranom:
(Def.'s 56.1 Stmt., Dkt. 33, ¶¶ 17-20.)
Acranom does not dispute the fact that Wenger made each of these payments. (Pl.'s 56.1 Response, Dkt. 40, ¶¶ 17-20.) Acranom's only counter to Wenger's motion for a credit for these payments is the assertion, stated in Acranom's Rule 56.1 Response and Monarca's affidavit, that "Acranom did not authorize payments to any entity other than Acranom for Acranom's work." (Pl.'s 56.1 Response, Dkt. 40, ¶¶ 17-20; Monarca Aff., Dkt. 39, ¶ 104.) That assertion does not raise a triable issue of fact as to whether Wenger's payments to Acranom's third-party creditors was authorized. The record shows that Wenger's payments to third-party creditors of Acranom was authorized under the Subcontract, which provided, in relevant part, that "[Wenger] reserves the right to issue joint checks and/or direct checks to Subcontractor and/or its vendors, suppliers or subcontractors, or any of Subcontractor's creditors having potential lien rights against the work." (Dkt. 32-14 (Subcontract) Art. 4.)
Accordingly, the Court grants Wenger's motion for a credit under the Subcontract for payments made to Acranom and on Acranom's behalf, as summarized above.
For the foregoing reasons, the Court grants in part and denies in part Wenger's motion for summary judgment. The Court denies Wenger's motion for a finding that Wenger is entitled to a credit of $1,050,000 for the elimination of 17,700 square feet of brick removal from the scope of the Project. The Court denies Wenger's motion for a credit of $23,769 based on Acranom's failure to provide payment and performance bonds as required by the Subcontract. The Court grants Wenger's motion for summary judgment dismissing Acranom's claims for extra work denominated as PCOs ##5, 6, 7, 8, 9, 11, 12, 13, and 14. The Court grants Wenger's motion for a credit under the Subcontract for payments made to Acranom and on Acranom's behalf, totaling $596,124.20.
SO ORDERED.
