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Tortious Interference with Contract.

In this case, the Third Department included a clear description of the proof requirements for tortious interference with contract.  Schmidt & Schmidt vs. Town of Charlton, 515053 Third Dept. 2-21-13

 

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Fee Agreement Unenforceable as Vague.

A written agreement concerning a “success fee” and real estate broker’s commissions was deemed unenforceable as vague, “since the agreement fails to set the price or compensation to be received…”.  Magnum Real Estate Services, Ind. Vs 133-134-135 Associates, LLC, 8058, 107850/06 First Dept. 2-14-13

 

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Standard for Upward Child Support Modification, Agreement Incorporated But Not Merged.

This case, which was not affected by the 2010 amendment to Family Court Act section 451(2)(a), includes a clear discussion of the criteria for an upward modification of a child support obligation where a party is seeking to modify “a child support provision derived from an agreement or stipulation incorporated but not merged into a divorce decree…”.  The party seeking modification “has the burden of proving that the agreement was unfair or inequitable when entered into or that an unanticipated and unreasonable change of circumstances has occurred resulting in a concomitant increased need or that the needs of the child are not being adequately met…”.  Matter of Overbaugh vs Schettini, 515079 Third Dept. 2-14-13

 

Mutual Mistake.

“Mutual mistake may furnish the basis for the reformation of a written agreement where the signed writing does not express the actual agreement of the parties…. Parol evidence is admissible to establish the actual agreement.  There is a heavy presumption that the executed agreement reflects the true intention of the parties, and a correspondingly high order of evidence is required to overturn the presumption …”  The First Department found that a question of fact had been raised concerning whether the doctrine of mutual mistake should be applied to reform the contract in this case.  West Vernon Petroleum Corp. vs. Singer Holding Corp., 2010-10522, Second Dept. 2-6-13

 

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Arbitrator’s Rulings Largely Unreviewable

An arbitrator’s interpretation of a collective bargaining agreement was vacated by the trial court.  The Fourth Department reversed and confirmed the arbitration award.  The decision includes a substantive discussion of the criteria that must be met before an arbitration award can be disturbed by a court.   “[A]n arbitrator’s rulings, unlike a trial court’s, are largely unreviewable…”.  An arbitrator’s interpretation of a contract may be set aside “only if the [arbitrator] gave a completely irrational construction to the provisions in dispute and, in effect, made a new contract for the parties…”.  Matter of the Arbitration between Professional, Clerical, Technical, Employees Association and Board of Education for Buffalo City School District, 1317, CA 12-01143 Fourth Dept. 2-1-13

 

 

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Spoliation, Discovery Abuse Sanctions, Equitable Estoppel.

In a full-fledged opinion by Justice Richter discussing a breach of contract case with a convoluted history, the First Department dealt with the spoliation of evidence and the appropriate sanctions for spoliation under the CPLR.  It was alleged that a document was deliberately scorched so its authenticity could not be determined by scientific tests.  The Court remanded the case for a hearing on the spoliation issue and determined that, under the facts of the case, if spoliation is demonstrated at the hearing, striking the pleadings would not be an appropriate sanction.  The Court suggested a monetary sanction. Although most of the decision deals with the factual history of the case, there are substantive discussions of sanctions for discovery abuse under CPLR 3126 and the doctrine of equitable estoppel. Melcher v Appolo Medical Fund Management, LLC, et al, 4759-4764, Index 604047/03 First Dept. 1-29-13.

 

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At Will Employee Can Not Use “Fraudulent Inducement” Theory Re: Acceptance-of-Employment Offer.

Plaintiff brought a cause of action for “fraudulent inducement” alleging she accepted employment with defendant hospital based on a false claim the hospital had “passed” a survey related to accreditation when, in fact, it had received only a “conditional accreditation status.”  The Second Department determined that the fraudulent inducement cause of action must be dismissed because plaintiff was an at-will employee.  “The at-will employment doctrine … bars a cause of action sounding in fraudulent inducement, even where the circumstances pertain to a plaintiff’s acceptance of an offer of a position rather than his or her termination …”.  The Second Department agreed with the trial court that the breach of contract cause of action should not be dismissed, but the Court dismissed the punitive damages aspect of the breach of contract cause of action because punitive damages do not attach to purely private wrongs.  Guido v Orange Regional Medical Center, 2011-08527, Index No. 13123/10 Second Dept. 1-23-13

 

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Duty to Defend Broader than Duty to Indemnify.

The Second Department applied the rule that an insurer’s duty to defend under a policy is broader than its duty to indemnify.  Because the language of the policy was broad enough to cover the cause of action for unfair competition, the insurer was obligated to defend, in spite of the fact that the related breach of contract cause of action was excluded from coverage under the terms of the policy.  Natural Organics, Inc v OneBeacon America Insurance Co., 2011-03268, 2011-05298, Index No. 12763/10 Second Dept. 1-16-13

 

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Breach of Contract Not a Defense to Action on Promissory Note.

Breach of contract is not a defense to an action for money only on a promissory note. The breach of contract could, however, be the subject of a separate action.  German American Capital Corporation v Oxley Development Company, LLC 8937 Index 651140/10 First Dept. 1-3-13

 

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