Opinion
2013-1512
11-14-2018
George CORKRAN, Plaintiff, v. ORICS INDUSTRIES, INC., Defendant.
For plaintiff: Jim Barna, Esq., The Barna Law Firm For defendant: Jacob Oslick, Esq., and Paul Galligan, Esq., Seyfarth Shaw LLP
For plaintiff: Jim Barna, Esq., The Barna Law Firm
For defendant: Jacob Oslick, Esq., and Paul Galligan, Esq., Seyfarth Shaw LLP
Donald F. Cerio Jr., J.
This matter comes before the Court upon the Defendant's Notice of Motion for Summary Judgment, dated August 9, 2018; Memorandum of Law in Support of Defendant's Motion for Summary Judgment, dated August 9, 2018; Defendant's Statement of Undisputed Facts in Support of Its Motion for Summary Judgment, dated August 9, 2018, and; the August 7, 2018, Affidavit of Ori Cohen.
Plaintiff filed a Notice of Motion for Partial Summary Judgment; Affirmation of Jim Barna, Esq., in Support of Plaintiff's Motion for Summary Judgment; Plaintiff's First Affidavit; Plaintiff's Statement of Undisputed Facts in Support of Its Motion for Summary Judgment, and; Plaintiff's Memorandum of Law in Support of Plaintiff's Motion for Partial Summary Judgment, dated August 17, 2018.
In response to the defendant's motion for summary judgment the plaintiff submitted the Plaintiff's Memorandum in Response to Defendant's Motion for Summary Judgment; Plaintiff's Responsive Statement of Undisputed Facts Regarding Defendant's Motion for Summary Judgment, and; George Corkran's Second Affidavit, dated October 12, 2018.
The defendant, with respect to the plaintiff's motion for partial summary judgment, submitted the Defendant's Counterstatement of Disputed Facts in Opposition to Plaintiff's Motion for Summary Judgment; Memorandum of Law in Opposition to Plaintiff's Motion for Summary Judgment, and; Affirmation of Jacob Oslick, Esq., in Support of Defendant's Opposition to Plaintiff's Motion for Summary Judgment, dated October 12, 2018. In addition to the foregoing, defendant submitted the Reply Memorandum of Law in Further Support of Defendant's Motion for Summary Judgment and the Supplemental Affirmation of Jacob Oslick, Esq., in Further Support of Defendant's Motion for Summary Judgment, dated October 18, 2018.
This matter was addressed at the court's October 19, 2018, motion term. The following reflects the Decision and Order of this court:
Briefly, the plaintiff had commenced the instant action with respect to monies due and owing with respect to his employment with Defendant Orics Industries, Inc., as a service technician from July 2006 through April 10, 2009. The primary matter of contention is whether the plaintiff was an hourly employee, subject to additional compensation, or a salaried employee, not otherwise subject to similar remuneration.
With respect to both the plaintiff's motion for partial summary judgment and the defendant's motion for summary judgment, a reviewing court is constrained so as to insure that factual disputes are properly resolved in open court. As was held in Wagner v. Zeh , 45 Misc 2d 93, S.Ct. Albany Co., 1965, affd 26 ad2d 729, 3rd Dpt. 1966:
A remedy which precludes a litigant from presenting his evidence for consideration by a jury, or even a Judge, is necessarily one which should be used sparingly, for its mere existence tends to alter our jurisprudential concept of a "day in court". Understandably, courts speak of the summary judgment restrictively. Summary judgment is a harsh remedy and the requirement of the rule should be strictly complied with in order to entitle a party to that relief. ( Bakerian v. Horn , 21 AD2d 714 ). To grant summary judgment, it must clearly appear that no material and triable issue of fact is presented. This drastic remedy should not be granted where there is any doubt as to the existence of such issues. ( Di Menna & Sons v. City of New York , 301 NY 118 ; Braun v. Carey , 280 App. Div. 1019 ). On the other hand, the court should not hesitate to give this remedy the full purpose for which it is intended. Given the statutory sanction, it is the duty of the court, not to test the sufficiency of the pleadings, but rather to go behind them to the very substance of the action and distinguish matters of law from matters of fact, material issues of fact from immaterial ones. The task of the court now is to determine if a "material issue of fact" is presented. (Di Menna & Sons v. City of New York , supra .; *96 Bakerian v. Horn , supra .). As an adjective "material" means "substantial; of consequence; important; going to the essence or the merits; relating to matter of substance, rather than form." (Ballentine's Law Dictionary.)
Once the moving party establishes his entitlement to judgment as a matter of law, the burden then shifts to the opposing party to establish, by admissible proof, that some genuine issue of a material fact exists. Card v. Brown , 43 AD3d 594 (3d Dept 2007) ; Chunn v. Carman , 8 AD3d 745 (3d Dept 2004). In the face of a motion for summary judgment, the party against whom it is sought is obligated to lay bare his proof, that is, to demonstrate by affidavit or otherwise that one or more triable issues of fact genuinely exist. If such proof is not forthcoming, summary judgment may well be the result. Zuckerman, supra ; RM & M Framemakers v. Baucom, 198 AD2d 695 (3d Dept 1993). If a party seeks summary judgment dismissing a cause of action asserted against him, that party must proffer evidence showing that his adversary's pleadings contain no meritorious claim. Franceschi v. Consolidated Rail Corp. , 142 AD2d 915 (3d Dept 1988).
The court reviews a summary judgment motion in the light most favorable to the party opposing it, giving that party the benefit of every inference that may be reasonably and fairly drawn. Card v. Brown, supra ; Secore v. Allen , 27 AD3d 825 (3d Dept 2006). Through that prism, the court determines whether any triable issue of a material fact exists. If it does, then resolution of the issue must await trial. If it does not, then the court may summarily grant judgment without the need for a trial. Sillman v. Twentieth Century Fox Film Corp. , 3 NY2d 395 (1957) ; Gadani v. Dormitory Authority of the State of New York , 43 AD3d 1218 (3d Dept 2007) ; Raven Industries, Inc. v. Irvine , 40 AD3d 1241(3d Dept 2007).
Thus, the Court's function is to ascertain if there are any issues of fact rather than seeking to determine the issues on the submissions alone. (See Sillman v. Twentieth Century-Fox Film Corp. , 3 NY2d 395 ). Upon a motion for summary judgment the Court is not to determine questions of credibility as such is a matter of sufficient materiality as to form the basis upon which denial of a summary judgment may lie. ( Glick and Dolleck v. Tri-Pac Export Corp. , 22 NY2d 439, and; Trionfero v. Vanderhorn , 6 AD3d 903 ).
It is thus through this prism the court must consider the present proceedings.
Here, upon having considered the submissions of the parties and relevant law, this court finds that the defendant's motion seeking summary judgment and, consequently, dismissal of the plaintiff's amended complaint, must be granted. As such, this court need not reach the remaining aspects of the defendant's motion for summary judgment nor the plaintiff's motion for partial summary judgment.
Specifically, the defendant has sought dismissal of the plaintiff's amended complaint asserting that such is barred by judicial estoppel. In particular, the defendant asserts that the plaintiff's 2013 bankruptcy proceeding, which discharged all identified and acknowledged financial obligations of the plaintiff, along with those of his spouse, precludes him from now prosecuting the instant action.
Factually, the plaintiff had been employed by the defendant from July 2006 through April 2009, when an issue pertaining to compensation arose and the plaintiff concluded his employment with the defendant. Plaintiff thereafter retained counsel with respect to his employment with the defendant and plaintiff's counsel engaged the defendant during 2009 and 2010 in an effort to resolve the underlying compensation dispute. The plaintiff, having found himself in financial straits, engaged the services of unrelated legal counsel to commence a bankruptcy proceeding on behalf of he and his wife. Attorney Richard Ward, on behalf of the plaintiff and his wife, filed a Chapter 7 bankruptcy petition on May 16, 2013, in the Northern District of New York, seeking discharge of pending financial obligations. The bankruptcy petition, as filed on behalf of the plaintiff, required the plaintiff to disclose any "liquidated debts owed to debtor" and "contingent and unliquidated claims of every nature." Though the plaintiff had retained counsel regarding the compensation issue with respect to the defendant, no disclosure of such was made in the bankruptcy proceeding regarding this matter. Subsequently, on June 21, 2013, the bankruptcy trustee reported to the Bankruptcy Court that there were no assets or properties available for distribution to satisfy any outstanding obligations of the plaintiff, which were not otherwise exempted.
The present action was commenced by the plaintiff by filing the complaint on July 19, 2013. Attorney Ward, himself apparently unaware of the action now commenced against the defendant, filed an amended bankruptcy petition on September 4, 2013, on behalf of the plaintiff and his wife which, again, failed to disclose the existence of the present action. The bankruptcy court, based upon these various submissions, entered a final decree with respect to the plaintiff's bankruptcy petition and discharged his financial obligations by order dated October 7, 2013.
Throughout the bankruptcy proceeding it is evident that the instant action was not disclosed to the federal court or the bankruptcy trustee by the plaintiff. As such, the likelihood of recovery by the plaintiff, however likely, was not made known and was not considered with respect to the bankruptcy action and financial obligations owed to the creditors of the plaintiff and his spouse.
Defendant's counsel asserts that the plaintiff did not disclose the existence of the bankruptcy proceeding during the course of discovery. (August 9, 2018, Memorandum of Law at Page 6, Footnote 3).
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Judicial estoppel is an equitable bar to enforcement of a claim where the claiming party had taken a position previously which is inconsistent with its present pursuit. It is, in essence, a mechanism by which the integrity of the courts is to be maintained by insuring that inequitable results are not achieved by deceit, fraud or malfeasance. In Coffaro v. Crespo , 721 F. Supp.2d 141 (2010), USDC, EDNY, the District Court explained the applicability of judicial estoppel within the context of a legal proceeding:
"The doctrine of judicial estoppel prevents a party from asserting a factual position in one legal proceeding that is contrary to a position that it successfully advanced in another proceeding." "A party invoking judicial estoppel must show that (1) the party against whom the estoppel is asserted took an inconsistent position in a prior proceeding and (2) that position was adopted by the first tribunal in some manner, such as by rendering a favorable judgment." Because it is an equitable doctrine, judicial estoppel can be invoked by a court at its discretion. However, judicial estoppel only applies "to situations where the risk of inconsistent results with its impact on judicial integrity is certain." Additionally, estoppel does not apply when a litigant's prior representations were the result of a good faith mistake or inadvertent error. (internal citations omitted; see also BPP Illinois, LLC v. Royal Bank of Scotland Group, PLC , 859 F.3d 188 [2017] ; McIntosh Bldrs. v. Ball , 264 AD2d 869 [3rd Dpt. 1999] ).
Here, there is no question that the plaintiff was aware of the prospective and then pending litigation, commenced on his behalf, seeking compensation for lost wages when he initially filed the bankruptcy petition in May 2013 and when he filed the amended petition in September 2013. This court is left to question whether the bankruptcy would have been as favorably resolved on behalf of the plaintiff had this particular action been disclosed and considered by the trustee as a successful resolution of the civil action may have been considered an asset subject to distribution on behalf of creditors of the plaintiff. However, this court does not question that, under the record before this court, the present proceeding is ripe for the application of judicial estoppel where the plaintiff, fully aware of the facts upon which the present action was commenced, chose not to disclose this information, which resulted in a favorable judgment to the plaintiff. This court concludes, under these circumstances, that the plaintiff's failure to disclose this information during the course of the bankruptcy proceeding was not a good faith mistake or inadvertent error; to assume otherwise would be inconsistent both factually and legally.
The plaintiff has asserted in his responsive papers that he intends to reopen the bankruptcy proceeding so as to address his deficiency regarding disclosure. That, in and of itself, may prove to be a precarious posture to seek as a reopened bankruptcy proceeding will certainly consider any recovery in the instant action as an asset subject to distribution to the plaintiff's creditors. As such, a reopening of the bankruptcy proceeding may result in the plaintiff having "won the battle but lost the war" as any recovery here may be subject to such distribution.
Therefore, while recognizing that the bankruptcy court is possessed of wide latitude with respect to the exercise of its discretion to reopen a bankruptcy proceeding, this court conditionally grants the defendant's motion for summary judgment and dismisses the plaintiff's amended complaint, in all respects, if the plaintiff fails to file his motion to reopen the bankruptcy proceeding within sixty (60) days of the date of this Decision and Order. Failure of the plaintiff to timely file his motion to reopen will result in dismissal of the present action without further action by this court.
In the event the plaintiff timely files the motion to reopen the bankruptcy proceeding, this Decision and Order shall be held in abeyance until such time as the bankruptcy court issues a decision with respect to the motion to reopen. If the bankruptcy court grants the plaintiff's motion to reopen the bankruptcy proceeding the present matter will be stayed subject to further review upon conclusion of the bankruptcy proceeding. If the bankruptcy court denies the plaintiff's motion to reopen the bankruptcy proceeding the present Decision and Order will immediately become effective without further action by this court.
SO ORDERED.