Court Opinion

ID: 3163528
Source: CourtListenerOpinion
Date Created: 2015-12-17 15:06:29.223661+00
Date Added: 2024-06-11T07:38:43.542599
License: Public Domain

State of New York
                   Supreme Court, Appellate Division
                      Third Judicial Department
Decided and Entered: December 17, 2015                   520931
________________________________

MAINES PAPER & FOOD SERVICE,
   INC.,
                    Respondent,
      v
                                            MEMORANDUM AND ORDER
KEYSTONE ASSOCIATES,
   ARCHITECTS, ENGINEERS,
   AND SURVEYORS, LLC,
                    Appellant.
________________________________

Calendar Date:   October 22, 2015

Before:   Peters, P.J., Garry, Rose and Clark, JJ.

                             __________

      Sugarman Law Firm, LLP, Syracuse (Jenna W. Klucsik of
counsel), for appellant.

      Hinman, Howard & Kattell, LLP, Binghamton (Albert J. Millus
Jr. of counsel), for respondent.

                             __________

Garry, J.

      Appeal from an order of the Supreme Court (Burns, J.),
entered November 3, 2014 in Broome County, which denied
defendant's motion for partial summary judgment.

      In 2009, plaintiff retained defendant to perform
architectural consulting services related to the construction of
a new supermarket. Following the completion of construction,
plaintiff's employees discovered that the supermarket floor had
begun to settle in an irregular manner. Thereafter, plaintiff
commenced this action sounding in breach of contract and
professional malpractice, alleging that the floor defect stemmed
                              -2-                520931

from construction methods that were inappropriate for the
conditions at the site. Following joinder of issue, defendant
moved for partial summary judgment on the issue of damages,
arguing that, in the event that it was found liable, the
prospective damages should be capped by application of a
limitation of liability clause. This clause was contained within
a schedule purportedly attached or incorporated into the parties'
contract (hereinafter Schedule A). Supreme Court denied
defendant's motion, finding that triable issues of fact existed
as to whether Schedule A – and the limitation of liability clause
contained therein – was included in the parties' contract.
Defendant appeals.

      Defendant submits that Supreme Court erred in that the
evidence established as a matter of law that plaintiff received
Schedule A, or, in the alternative, that Schedule A was
incorporated into the contract by reference. The proponent of a
motion for summary judgment bears the initial burden of showing
the absence of material issues of fact; once made, the burden
shifts to the opposing party "to produce evidentiary proof in
admissible form sufficient to establish the existence of material
issues of fact" (Alvarez v Prospect Hosp., 68 NY2d 320, 324
[1986]; see Phoenix Signal & Elec. Corp. v New York State Thruway
Auth., 90 AD3d 1394, 1396 [2011]). In support of its motion,
defendant submitted the parties' contract with an attached
Schedule A containing a limitation of liability clause. The
contract states that "[t]his Proposal, along with the attached
Standard Terms and Conditions, Schedule A, Schedule B, and the
Billing Rate Schedule represents the entire understanding between
the Client and Architect." Defendant also submitted an affidavit
from its managing member in which he asserts that Schedule A
"[was] attached to, and a part of, [defendant's] agreement with
[plaintiff]." He further stated that it is defendant's normal
business practice for it to send an accompanying copy of Schedule
A to all prospective clients whenever a proposed contract is
sent. These submissions met defendant's prima facie burden, and
thus required plaintiff to demonstrate triable issues of fact.1

    1
        Plaintiff argues that the photocopy of the contract
proffered by defendant appears to show hole-punch marks on the
                              -3-                520931

      In opposition, plaintiff submitted affidavits from its
director of corporate facilities and an administrative assistant.
The director stated that he had located a copy of the parties'
contract in plaintiff's files, but that, unlike the version
proffered by defendant, it did not have a Schedule A attached to
it. The administrative assistant stated that she had signed her
name to the parties' contract upon receiving it from defendant,
that the contract was stapled when she signed it and that there
was no Schedule A attached to it. Plaintiff also submitted its
copy of the contract, which did not include any attached Schedule
A. In sum, plaintiff's evidence directly contradicted the
averments of defendant's managing member that Schedule A was
attached to the contract and "[t]hese diametrical accounts of the
facts create credibility issues which may not be resolved on a
motion for summary judgment" (Rosenbaum v Camps Rov Tov, 285 AD2d
894, 895 [2001]; see Martin v Citibank, N.A., 64 AD3d 477, 477-
478 [2009]).

      In the alternative, defendant argues that, even if Schedule
A was not attached to the contract, it was nonetheless
incorporated into the contract by reference. In this regard,
defendant points to plaintiff's acknowledgment that it had
located two unexecuted draft contracts in its files that did
include a Schedule A and had apparently been sent to a former
employee of plaintiff. However, the content of the underlying
draft contracts differed substantially from the contract that was
ultimately entered into in terms of the scope of the work that
defendant was to perform. Further, the Schedule A attached to
these prior draft contracts differed, albeit only in minor
respects, from the Schedule A that defendant purports to have

executed contract, but not on the Schedule A that was allegedly
attached thereto; plaintiff suggests that this reveals that
defendant made the holes in the executed contract upon receipt,
and then attached Schedule A at a later point. We find little
merit in this speculative assertion. Amongst other possible
scenarios, it discounts the possibility that defendant's hole-
punching device simply failed to penetrate the entire document
(see generally Bush v Gore, 531 U.S. 98, 105 [2000]).
                                -4-                  520931

attached to the executed contract.2 The doctrine of
incorporation by reference "is grounded on the premise that the
material to be incorporated is so well known to the contracting
parties that a mere reference to it is sufficient" (Chiacchia v
National Westminster Bank, 124 AD2d 626, 628 [1986]). The
document is required to also be described in the contract such
that it is identifiable "'beyond all reasonable doubt'" (Kenner v
Avis Rent A Car Sys., 254 AD2d 704, 704 [1998], quoting Matter of
Board of Commrs. of Washington Park of City of Albany, 52 NY 131,
134 [1873]; accord Unclaimed Prop. Recovery Serv., Inc. v UBS
PaineWebber Inc., 58 AD3d 526, 526 [2009]). Here, defendant
failed to submit any evidence to show that the Schedule A
referenced in the contract was understood by the parties to be
coextensive with the Schedule A attached to the prior unexecuted
contracts. Instead, as set forth above, the evidence submitted
undermines this assertion. Thus, viewing the evidence in the
light most favorable to plaintiff (see e.g. William J. Jenack
Estate Appraisers & Auctioneers, Inc. v Rabizadeh, 22 NY3d 470,
475 [2013]), we find that defendant failed to conclusively
establish as a matter of law that Schedule A was sufficiently
identified in the executed contract so as to be incorporated by
reference (see County of Orange v Carrier Corp., 57 AD3d 601, 602
[2008]; Kenner v Avis Rent A Car Sys., 254 AD2d at 704-705;
Chiacchia v National Westminster Bank, 124 AD2d at 628).

        Peters, P.J., Rose and Clark, JJ., concur.

    2
        The Schedule A attached to the prior draft contracts
identified defendant as "CONSULTANT" while Schedule A that
defendant purported to have attached to the executed contract
identified defendant as "ARCHITECT."
                        -5-                  520931

ORDERED that the order is affirmed, with costs.

                       ENTER:

                       Robert D. Mayberger
                       Clerk of the Court