Court Opinion

ID: 6087483
Source: CourtListenerOpinion
Date Created: 2022-01-13 19:30:43.093953+00
Date Added: 2024-06-11T08:52:27.538252
License: Public Domain

Hurlbutt and Gorski, JJ.
(dissenting). We respectfully dissent. In our view, Supreme Court properly granted that part of plaintiffs cross motion seeking summary judgment on the second cause of action and properly granted the motion of defendant Allied Holdings, Inc. (Allied) for summary judgment dismissing the ninth cause of action against it. We conclude, *826however, that the court also should have granted those parts of plaintiffs cross motion seeking partial summary judgment on liability on the first and eighth causes of action.
At issue is whether plaintiff had reasonable grounds to refuse to close on its contract with defendant Commercial Carriers, Inc. (CCI), a wholly owned subsidiary of defendant Ryder System, Inc. (Ryder System), to purchase CCI Manufacturing (CCIM), CCFs trailer manufacturing business. In our view, plaintiff established as a matter of law that it had reasonable grounds to refuse to close on its contract (Gateway contract) on the scheduled date. We agree with the majority that the Gateway contract appeared to convey the subject intellectual property to plaintiff. However, the Allied contract, pursuant to which Allied was purportedly to purchase virtually all of the assets of specified Ryder System subsidiaries but not those of CCIM, contained certain provisions that could “to a person of reasonable prudence” be interpreted as also conveying the subject intellectual property to Allied (Regan v Lanze, 40 NY2d 475, 481). Section 3.10 of the Allied contract provided that Allied would own, directly or indirectly, all “ ‘Intellectual Property * * * owned by an Acquired Ryder Entity [including CCI] or otherwise used within the twelve (12) months prior to the Effective Date exclusively in the Conveyed Ryder Business.” Because CCIM was, until the sale of CCIM to plaintiff was to take place, part of CCI, the Allied contract conveyed to Allied any intellectual property used by CCI within the last 12 months, regardless of whether that intellectual property dealt exclusively with CCIM.
No other provision of the Allied contract specifically addresses whether Allied was acquiring ownership of CCIM intellectual property as part of the Allied contract. Section 1.3 of that contract provides that Ryder System will not sell “the trailer manufacturing operations of CCI” to Allied because Ryder System is “retaining]” those operations. That section does not mention the intellectual property of the trailer manufacturing operations.
In our view, because time was made of the essence by the terms of the contract and the cloud on title was not resolved by Ryder System within the time frame specified in the Gateway contract, plaintiff properly refused to close and is entitled to partial summary judgment on liability on the first cause of action, alleging breach of contract, and to summary judgment on the second cause of action, alleging breach of contract and seeking the return of plaintiffs deposit (see Cooper-Rutter Assoc. v Anchor Natl. Life Ins. Co. , 193 AD2d 944, 945-946). *827We further conclude that plaintiff is entitled to partial summary judgment on liability on the eighth cause of action, alleging that defendant Ryder Truck Rental, Inc., a Ryder System subsidiary, breached its guarantee of the obligations of CCI to plaintiff in the event of the failure to deliver marketable title to plaintiff. Also, for the same reasons, we conclude that the court properly granted the motion of Allied seeking summary judgment dismissing the ninth cause of action against it, alleging tortious interference with the Gateway contract. Present— Pigott, Jr., P.J., Hurlbutt, Kehoe, Burns and Gorski, JJ.