21

- 1021

- cv Grasso v. Donnelly

- Schoffstall



## UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT



# SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT ’ S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “ SUMMARY ORDER ” ). A PARTY CIT ING TO A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second Circuit, 1 held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of 2 New York, on the 1 1 t h d a y of M a r c h , two thousand twenty

- two

. 3 4 PRESENT: 5 JOHN M. WALKER, JR. , 6 PIERRE N. LEVAL , 7 MICHAEL H. PARK , 8 Circuit Judges. 9

______________________ ___ _______________ __ 10 11 BARBARA GRASSO , individually, DBA 12 DeGrasso ’ s Bernese Mountain Dogs , 13 14 Plaintiff

- Appellant , 15 16

v. 21

- 1021 17 18 JENNIFER DONNELLY

- SCHOFFSTALL , 19 individually, DBA Blue Ribbon Acres, DBA 20 Anatar’s Bernese Mountain Dogs, DBA Blue 21 Ribbon Acres Kennels, DBA Aces Canine , 22 23 Defendant

- Appellee

. 24 25

______________________ ___ ___________ __ ____ 26 27 28 FOR PLAINTIFF

- APPELLANT : Barbara Grasso
, pro se , Stratford, NY

. 29 30 FOR DEFENDANT

- APPELLEE: Stephanie M. Campbell , Bond, Schoeneck 31 & King PLLC, Syracuse, NY

. 322 Appeal from a judgment of the United States District Court for the Northern District of 1

New York ( Kahn
, J .). 2

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND 3

DECREED that the judgment of the district court is AFFIRMED in part and VACATED and 4

REMANDED in part

. 5

Appellant Barbara Grasso
, who was represented by counsel in the district court and is 6

proceeding pro se on appeal
, sued Jennifer Donnelly

- Schoffstall for breach of contract and unjust 7

enrichment under New York law, based on the dissolution of an alleged agreement to jointly breed 8

and sell Bernese Mountain Dogs. The district court dismissed the complaint with prejudice under 9

Fed eral R ule of Civ il P rocedure 12(b)(6), reasoning that Grasso had not alleged an agreement in 10

sufficiently definite terms to establish the existence of a contract ; that any contract would in any 11

event be barred by the New York statute of frauds be cause , by its terms
, it could not be performed 12

within one year ; and that Grasso could not avoid the statute of frauds by relabeling her contractual 13

claim as a claim for unjust enrichment. Grasso challenges those rulings and argues that the district 14

court erred in denying her request for leave to amend. 1 We assume the parties ’ familiarity with 15

the underlying facts, the procedural history of the case, and the issues on appeal. 16

“We review a district court’s grant of a motion to dismiss de no vo , accepting as true all 17

factual claims in the complaint and drawing all reasonable inferences in the plaintiff’s favor.” 18

Altimeo Asset Mgmt. v. Qihoo 360 Tech. Co. , 19 F.4th 145, 147 (2d Cir. 2021) ( citation omitted). 19

1 Donnelly

- Schoffstall moves to strike exhibits to Grasso’s complaint that are not part of the district court record. Grasso has not argued that the exhibits were omitted from the record due to “error or accident. ” See Fed. R. App. P. 10(e)(2). Th us, the motion to strike is GRANTED.3 “We review a district court’s denia l of leave to amend for abuse of discretion , unless the denial 20

was based on an interpretation of law, such as futility , in which case we review the legal 21

conclusion de novo .” Empire Merchs

. , LLC v. Reliable Churchill LLLP , 902 F.3d 132, 139 (2d 22

Cir. 2018) ( citation omitted). 23

I. Breach of Contract 24

“ To state a claim for breach of contract under New York law, the complaint must allege: 25

(i ) the formation of a contract between the parties; (ii) performance by the plaintiff; (iii) failure of 26

defendant to perform; and (iv) damages.” Nick’s Garage, Inc. v. Progressive Cas. Ins. Co. , 875 27

F.3d 107, 114 (2d Cir. 2017) ( cleaned up ). As to the fir st element, “[i] t is well settled that a 28

contract must be definite in its material terms in order to be enforceable.” Clifford R. Gray, Inc. 29

v. LeChase Const r

. Servs., LLC , 31 A.D.3d 983, 985 (3d Dep’t 2006) ( citation omitted) . This 30

requirement is satisf ied where there is “an objective method for supplying a missing term.” Id. at 31

986 ( citation omitted)

. 32

We a ffirm the district court ’s conclusion that the vague and internally inconsistent 33

allegations in Grasso’s complaint failed to provide an objective m ethod for determining Donnelly

34

Schoffstall’s obligations under the alleged contract. For example, Grasso alleged both that 35

Donnelly

- Schoffstall was required to pay Grasso’s credit card bill s and also that she was required 36

only to “assist” in paying those bill s

. She also alleged that Donnelly

- Schoffstall was required to 37

“shar[e]” the profits from the sale of puppies with out specifying whether there was a specific 38

percentage or amount to which Grasso was entitled. Such vague allegations are not sufficiently 39

definite to be enforceable. 40

We also agree with the district court that, as pleaded, the alleged contract would be barred 414 by the New York statute of frauds. A contract is void under New York law unless it is reduced 42

to a writing if it “[b]y its terms is not to be performed within one year from the making thereof.” 43

N.Y. Gen. Oblig. L. § 5

- 701(a)(1). A contract of in definite duration, lacking a provision for a 44

party to terminate the contract other than by breaching it, cannot be performed within one year of 45

its making. See D & N Boening, Inc. v. Kirsch Beverages, Inc. , 63 N.Y.2d 449, 457 (1984) (“The 46

possibility of . . . wrongful termination is not, of course, the same as the possibility of performance 47

within the statutory period.” ( cleaned up) ). Here, Grasso did not plead that there was a written 48

contract, that the parties’ agreement had any durational element, or t hat there was any termination 49

provision. 50

The statute of frauds is “generally inapplicable” to agreements to form a joint venture. 51

Unicorn Enter s. , Ltd. v

. Stonewall Contracting Corp. , 232 A.D.2d 404, 405 (2d Dep’t 1996); see 52

also F.S. Intertrade Off. Prod s ., Inc. v. Babina , 199 A.D.2d 95, 96 (1 st Dep’t 1993 ) . This is true 53

even if the joint venture is of indefinite duration “because, absent any definite term of duration, an 54

oral agreement to form a partnership or joint venture for an in definite period creates a partnership 55

or joint venture at will. ” Foster v. Kovner , 44 A.D.3d 23, 27 (1 st Dep’t 2007)

. But Grasso did 56

not plead the existence of any provision in the parties’ agreement for sharing losses, which is an 57

“essential element[]” of a joint venture. Ackerman v. Landes , 112 A.D.2d 1081, 1082 (2d Dep’t 58

1985). T he district court thus properly dismissed Grasso’s breach of contract claim, both for lack 59

of sufficiently definite material terms and because any contract would be void unde r the statute of 60

frauds. 61

We also affirm the district court’s dismissal of the contract claim without affording Grasso 62

the opportunity to move for leave to replead. But we do so not with respect to what happened in 635 the district court, but what happened on appeal. In the district court, in briefing the motion to 64

dismiss, Grasso had expressly requested leave to replead if the motion were granted, the complaint 65

had not previously been amended, and our precedents favor that “leave [to amend]

. . . be freely 66

given when justice so requires,” Ronzani v. Sanofi S.A. , 899 F.2d 195, 198 (2d Cir. 1990) (citing 67

Fed. R. Civ. P. 15(a)(2)), the district court ought to have offered the opportunity to show, in support 68

of a motion for leave to replead, that an amended ple ading would cure the defects. Instead, the 69

court stated in the ruling that found the pleading insufficient that the suit was dismissed with 70

prejudice and entered judgment the same day, effectively denying Grasso an opportunity to move 71

for leave to amend. 72

We nonetheless affirm the grant of judgment with prejudice based upon what happened on 73

appeal . Grasso had ample opportunity on briefing this appeal, protesting the district court’s 74

failure to allow an amended pleading, to explain how she could cure the defects. She has not done 75

so. We accordingly conclude that grant of leave to replead would be futile and affirm the district 76

court’s dismissal with prejudice of the contract claim. See In re Tamoxifen Citrate Antitrust Litig.
, 77

466 F.3d 187, 220 (2d Cir. 2006) (“[W]here amendment would be futile, denial of leave to amend 78

is proper.”). 79

II. Unjust Enrichment 80

Unjust enrichment is a quasi

- contractual claim arising in “ equity to prevent injustice, in the 81

absence of an actual agreement between the parties concerned.” IDT Corp. v. Morgan Stanley 82

Dean Witter & Co

. , 12 N.Y.3d 132, 142 (2009). “The esse nce of such a cause of action is that 83

one party is in possession of money or property that rightly belongs to another.” Clifford R. Gray, 84

Inc. , 31 A.D.3d at 988. To prevail on an unjust enrichment claim, a plaintiff must show “that (1) 856 the defendant was enriched, (2) at the expense of the plaintiff, and (3) that it would be inequitable 86

to permit the defendant to retain that which is claimed by the plaintiff.” Id. Where “the existence 87

of the contract is in dispute, the plaintiff may allege causes of acti on to recover for unjust 88

enrichment and in quantum meruit as alternatives to a cause of action alleging breach of contract.” 89

Thompson Bros. Pile Corp. v. Rosenblum , 121 A.D.3d 672, 674 (2d Dep’t 2014). 90

W here a contractual claim is barred by the statute o f frauds, a plaintiff may not avoid that 91

bar by relabeling the same claim under a quasi

- contractual theory. See Grappo v. Alitalia Linee 92

Aeree Italiane, S.p.A. , 56 F.3d 427, 433 (2d Cir. 1995) (citing Farash v. Sykes Datatronics, Inc.
, 59 93

N.Y.2d 500, 503 (1983)) ( discussing quantum meruit claim)

. A n unjust enrichment claim can 94

proceed , however, where the claim “ is used to seek recovery of the amount by which a defendant 95

was enriched at a plaintiff ’ s expense, rather than as an attempt to enforce an ora l contract.” 96

Litvinoff v. Wright , 150 A.D.3d 714, 715 (2d Dep’t 2017). 97

To the extent that Grasso sought, through her unjust enrichment claim, to recover damages 98

arising from Donnelly

- Schoffstall ’s breach of their alleged agreement, her claim is barred by the 99

statute of frauds. See Grappo , 56 F.3d at 433. But Grasso also alleged that Donnelly

- Schoffstall 100

was in possession of Grasso’s property (including breeding dogs), refused to return it, and was 101

profiting from its unauthorized use. To the extent that Grasso sought to rectify Donnelly

102

Schoffstall’s withholding of her property or Donnelly

- Schoffstall ’s profits from its exploitation 103

based on these allegations, Grasso’s claim is not barred by the statute of frauds because it could 104

be proven without the existence of a contract, and the measure of damages would be “distinct from 105

the contract price.” Id. ; accord Litvinoff , 150 A.D.3d at 715. Accordingly, we vacate the 106

dismissal of Grasso’s unjust enrichment claim and remand for further consideration of this claim. 1077 On remand, the district court shall allow Grasso to replead alleging conversion
, unjust enrichment, 108

or both, within the lim its described above. 109

For the foregoing reasons , we GRANT Donnelly

- Schoffstall’s motion to strike, AFFIRM 110

the district court’s judgment as to the breach of contract claim
, VACATE the district court ’s 111

judgment as to the unjust enrichment claim
, and REMAND the case for further proceedings 112

consistent with this order. 113

114 FOR THE COURT: 115 Catherine O ’ Hagan Wolfe, Clerk of Court 116