Court Opinion

ID: 5777754
Source: CourtListenerOpinion
Date Created: 2022-01-12 17:44:44.440359+00
Date Added: 2024-06-11T08:41:54.874021
License: Public Domain

Nunez, J.
The defendant appeals from an order entered in New York County (Levey, J.) on July 2,1970, granting summary judgment to the plaintiff on the issue of liability only and denying defendant’s cross motion for the same relief.
The pertinent facts in this litigation are sufficiently stated in the dissenting opinion and need not be repeated herein. We agree with Justice Steuer that referral to a private Referee to determine whether the papers submitted disclosed any triable issue was unwarranted. The referred question should have been determined by Special Term in the first instance. But the reference proceeded on consent of experienced, knowledgeable counsel.
We are in unanimous agreement on one of the major contentions relied upon by the defendant on this appeal: that the May 24, 1966 letter, prepared by the defendant, constitutes a valid contract containing all material terms and repeatedly recognized as a valid contract by the defendant. We disagree as to the only other major issue raised on this appeal: whether by the December 19, 1966 letter the defendant repudiated its obligations under the May 24 agreement, endeavoring to extricate itself from a bad bargain. We conclude as a matter of law that *64such was the case. The repudiation was unilateral and for a legally unacceptable reason—the desire to avoid a lawsuit. We quote in part from Bethlehem’s letter to plaintiff: “you have seen fit to transfer the controversy concerning Sabine ’ into the courts. * * *
‘ ‘ Under the circumstances, we think it is totally unrealistic for either party to assert that the other party is bound by a contract in respect to ' Midlake ’ and is withholding performance, causing damages to the other party, etc. If ‘ Midlake ’ is to be converted at our Yard * * * despite the lack of agreement on ‘ Sabine ’, it is essential that an agreement be reached * * * setting forth precisely what work is to be done, how much is to be paid (and when) and the date for completion. * * * To the extent that agreements on ‘ Midlake ’ can be reached * * * whatever work you want performed will be done.
“We attach a proposal.”
As clearly appears, Bethlehem declared that it did not consider itself bound by the May 24 agreement and that it would proceed with the conversion of the Midlake only if a new agreement was signed by the parties. This was an unqualified repudiation of the May 24 agreement. (See Wester v. Casein Co. of Amer., 206 N. Y. 506; Dimon Corp. v. Federal Sugar Refining Co., 215 App. Div. 140 [1st Dept., 1925].)
The December 19 proposal called for higher prices for many items including materials and insurance, and extended the time for completion of the work. It also provided for progress payments, whereas the May 24 contract provided for payment on delivery (as in Sabine), and permitted revision only if “any increase in labor ” occurred. (Italics mine.) Furthermore, there is no evidence in the record of any request by Bethlehem to York for agreement with respect to extras, removals, replacements and changes as a condition to proceed to convert the Midlake. The record justifies the Referee’s findings that Bethlehem sought to impose a new agreement upon York with new prices and new date of completion, and categorically denied that the May 24 agreement was binding upon it. Bethlehem’s repudiation of the May 24 agreement and its insistence upon a new contract are further evidenced by a memorandum from its credit manager to the general manager of its shipbuilding yard dated October 26, 1966 stating in its pertinent part: “We wish to confirm * * * that no work will be done on the above jumboization until a firm contract has been signed with agreed progress payment terms ”. (Italics added.) Indeed, it was con*65ceded on oral argument that what Bethlehem sought was a new contract.
We have examined the other points raised by appellant and find no merit in any of them. It is clear that the phrase “ it appearing that the findings and conclusions of the Referee accord with the preponderance of the evidence adduced at the hearing ’ ’ was inadvertently inserted in the order which was submitted for settlement on notice. Defendant did not object to the order. The court’s attention was not called to the objectionable standard,,of proof. The point is raised for the first time on appeal. It clearly appears that Special Term confirmed the conclusion of the Referee’s report that the letter of May 24, 1966 constitutes a valid contract, that the letter of December 19, 1966 was a repudiation of the May 24 agreement, and that no triable issue of fact exists other than the extent of damages. The ‘ ‘ jumboization ’ ’ of the record resulted from the combined activity of both parties and its mere size is not indicative of the existence of any triable fact issues.
The order should be affirmed with costs and disbursements to respondent.