Opinion
12026/03.
Decided June 17, 2008.
Upon the foregoing papers in this action by plaintiff Dialcom, LLC (plaintiff) for, among other things, breach of sales agency agreements between it and defendant Concert, U.S.A. (Concert) and it and defendant AT T Corp. (AT T) (collectively, defendants), defendants move for an order, pursuant to CPLR 2221 (d), granting them leave to reargue the court's October 17, 2006 decision and order, or, in the alternative, pursuant to CPLR 3211 (a) (5) and (7), dismissing plaintiff's first, fourth, and sixth causes of action of its second amended complaint.
This action arises out of a sales agent relationship between plaintiff and defendants in which plaintiff, as defendants' agent, marketed certain international telecommunications services to companies, for which it was to be paid commissions by defendants. Plaintiff originally entered into a written Sales Agency Agreement with AT T (the SAA) on October 30, 1999, which expired on December 31, 1999. According to plaintiff, it continued to perform agency services for AT T and Concert (who, it was informed by AT T, would then be handling AT T's international operations) without a written agreement from January 1, 2000 to October 6, 2000. Plaintiff asserts that during that time period, in or about January 2000, it procured Qwest Communications (Qwest) as a customer for and on behalf of AT T. Plaintiff claims that in March 2000, AT T "transitioned" the Qwest account from it, i.e., AT T began servicing the Qwest account directly. In August 2000, plaintiff procured for Concert a three-year revenue-commitment contract with IDT (the IDT $750 Million Revenue-Commitment Contract), which assured that IDT would purchase Concert's services totaling, at a minimum, $750 million in revenues.
On October 6, 2000, plaintiff and Concert entered into a Master Agency Agreement (the MAA), which was made retroactively effective to April 1, 2000. The MAA contained three Service Attachments, which set forth pertinent terms of the MAA, including plaintiff's compensation via commission payments. Service Attachment One provided for a 2% commission in accordance with the following terms:
"(1) [Plaintiff] shall receive a two percent (2%) Commission based on the total revenue amount actually billed and collected by Concert pursuant to a Customer contract and which revenues are accomplished directly as a result of [plaintiff's] marketing efforts in accordance with section 4 of the Agreement (Agent Realized Revenues')."
Section 4 of Service Attachment One also set forth a formal bonus structure based on Agent Realized Revenues, with bonus commissions payable to plaintiff retroactively, within 60 days after the formal closing of the fiscal book year for Concert in the territory.
Section 4 of the MAA, entitled "Nonexclusive Agency," reserved Concert's right to deal directly with all customers of its services, without the involvement of plaintiff. Under this section, Concert could "transition" any customer account, i.e., take an account then being serviced by plaintiff and transfer it to Concert for in-house servicing and management by defendants. This section, however, provided that in the event that plaintiff was requested to transition account management to Concert for customers, Concert was required "to review commercially reasonable opportunities to compensate [plaintiff] for decreased [c]ommission amounts," taking into account certain designated factors.
Plaintiff claims that defendants, after transitioning the Qwest account, failed to compensate it for its marketing efforts or other services which it had rendered in connection with the Qwest account. Plaintiff also claims that almost immediately after it had secured the IDT $750 Million Revenue-Commitment Contract, Concert transitioned it, but that Concert and AT T continually assured it that it would be paid its 2% commission and all appropriate bonus commissions under the MAA. According to plaintiff, it first learned, in or about October 2002, that AT T would not pay it on the ground that the MAA provided that AT T was only obligated to pay it commissions on revenue amounts "actually billed and collected by Concert," and AT T, not Concert, had, in fact, billed and collected the revenue amounts generated from the IDT $750 Million Revenue-Commitment Contract. Plaintiff also alleges that Concert did not pay it commissions owed with respect to Bell South and Verizon accounts, which were also transitioned.
On April 2, 2003, plaintiff, through its prior attorneys, filed this action. Plaintiff's first amended complaint (which was identical to its original complaint except that it annexed exhibits) asserted causes of action against defendants sounding in breach of contract, promissory estoppel through oral representations, fraud, and breach of the covenant of good faith and fair dealing. Plaintiff's first amended complaint focused almost entirely on paragraph four of section 4 of the MAA, which (as set forth above) provided that Concert was required to "review commercially reasonable opportunities" to compensate plaintiff for decreased commissions in the event that defendants transitioned "account management" of any account procured by plaintiff to Concert. By decision and order dated July 20, 2004, the court granted, in part, a motion to dismiss by defendants. This included the dismissal of plaintiff's first cause of action for breach of contract with respect to the IDT account and Qwest account as time-barred, and the dismissal of plaintiff's second cause of action for promissory estoppel, its third cause of action for fraud, and its fourth cause of action for breach of the covenant of good faith and fair dealing. Thereafter, plaintiff moved to amend its first amended complaint. Plaintiff's proposed second amended complaint, like its original complaint, focused entirely on paragraph 4 of section 4 of the MAA. Defendants cross-moved to dismiss plaintiff's proposed second amended complaint on the ground that the claims set forth therein were already dismissed by the court's July 20, 2004 order.
By decision and order dated November 29, 2005, the court denied plaintiff leave to replead or to further amend its complaint so as to include those claims and/or causes of action previously dismissed by the court, i.e., portions of plaintiff's causes of action for breach of paragraph 4 of section 4 of the MAA. The court also denied plaintiff's request to add a punitive damages claim. However, the court granted plaintiff's motion to amend to the extent that the proposed amended complaint included proposed additional allegations insofar as they merely supplemented plaintiff's breach of contract claim based upon defendants' alleged bad faith acts in reviewing commercially reasonable opportunities as a means of compensating plaintiff for lost commissions.
Shortly thereafter, plaintiff retained new attorneys, who, upon reviewing the case file, found a complete failure by plaintiff's prior attorneys to plead any causes of action or allegations concerning defendants' payment obligations under Service Attachment One, or any portion of the MAA aside from paragraph 4 of section 4, or to properly plead a quantum meruit claim with respect to the Qwest account. Consequently, plaintiff filed a motion to renew the prior motions and modify three certain specific portions of the court's July 20, 2004 and November 29, 2005 orders, and, pursuant to CPLR 3025, for leave to amend the first amended complaint. Plaintiff sought such leave to amend in order to set forth a more complete and accurate factual background of this matter, including supplemental factual allegations concerning the Service Attachments to the MAA, the full text of section 4 of the MAA, and the complete factual circumstances surrounding the IDT and Qwest accounts.
Specifically, plaintiff, in its motion, explained that the MAA, in section 1, referred to and incorporated by reference the three Service Attachments, which set forth the specific information pursuant to which Concert appointed it as Concert's agent, including detailed compensation and payment terms, and, in section 7(a), provided that its sole compensation under the MAA was payment via a commission structure set forth in the Service Attachments. Plaintiff pointed out that nothing in the MAA relieved Concert of its obligations to pay it a straight 2% commission and to pay bonus commissions, which were actually specified in Service Attachment One, once plaintiff had initiated "marketing efforts" resulting in the procurement of an account, regardless of whether account management of a particular account was transitioned to defendants. Plaintiff further pointed out that paragraph 4 of section 4 of the MAA (the focus of most of the prior litigation in this action) only addressed supplemental compensation (separate and distinct from Concert's payment obligations under Service Attachment One and the MAA) payable to it in the event that account management was transitioned away from it to Concert and Concert's account management caused a decline in revenues.
By decision and order dated October 17, 2006, the court denied plaintiff's motion insofar as it sought leave to renew to modify certain portions of the court's earlier orders, but granted plaintiff leave to amend the first amended complaint. Plaintiff, in accordance with that order, served and filed the second amended complaint.
In addressing defendants' motion insofar as it seeks leave to reargue the court's October 17, 2006 decision and order, it is noted that a motion to reargue "shall be based upon matters of fact or law allegedly overlooked or misapprehended by the court in determining the prior motion" (CPLR 2221[d][2]; see also Matter of Hoffmann v Debello-Teheny , 27 AD3d 743, 743; Daluise v Sottile , 15 AD3d 609 , 609). The purpose of a motion to reargue is not "to serve as a vehicle to permit the unsuccessful party to argue once again the very questions previously decided" ( Foley v Roche, 68 AD2d 558, 567; see also William P. Pahl Equip. Corp. v Kassis, 182 AD2d 22, 27; Pro Brokerage v Home Ins. Co., 99 AD2d 971, 971; Richardson Lindenbaum Young, 14 Misc 3d 1223 [A], 2007 NY Slip Op 50130 [U], *3 [2007]; Bankers Trust Co. of Cal. v Payne, 188 Misc 2d 726, 729; American Trading Co. v Fish, 87 Misc 2d 193, 195).
In support of their motion to reargue, defendants reiterate their argument that plaintiff's second amended complaint is wholly inconsistent with plaintiff's prior pleadings and squarely at odds with the prior sworn statements of its attorneys and principals. These very same arguments were previously advanced by defendants in opposition to plaintiff's motion for leave to amend, and were considered and rejected by the court ( see Foley, 68 AD2d at 567; American Trading Co., 87 Misc 2d at 195).
Furthermore, the primary allegations of plaintiff's second amended complaint are not inconsistent with plaintiff's prior pleadings and sworn statements. As noted above, plaintiff's prior pleadings had focused on paragraph 4 of section 4 of the MAA, and claimed a breach thereof, whereas plaintiff's second amended complaint alleges that, in addition to defendants' obligations under paragraph 4 of section 4 of the MAA, defendants had an obligation under the MAA and Service Attachment One to pay it a straight 2% commission (and bonus commissions) on all revenue billed and collected by Concert on an ongoing basis, regardless of whether defendants transitioned "account management" of a particular account, once plaintiff initiated "marketing efforts" resulting in the procurement of an account. Thus, the second amended complaint is supplemental to, rather than inconsistent with, plaintiff's prior pleadings and statements. In addition, plaintiff's second amended complaint is supported by the documentary evidence, i.e., the MAA and Service Attachment One ( see Holchendler v We Transp., 292 AD2d 568, 569; Eagle Ins. Co. v Queens Tunnel Serv. Sta., 287 AD2d 434, 434-435; Zwiebel v Guttman, 4 Misc 3d 1010 [A], 2001 NY Slip Op 50805 [U], *8 [2004]).
Defendants further argue that the court should not have permitted plaintiff to amend its complaint because plaintiff did not offer any new or additional facts, but just raised a new legal theory. This argument must be rejected. As discussed above, plaintiff has raised additional factual allegations setting forth cognizable claims, which warrant a granting of a motion to amend ( see CPLR 3025 [b]). Leave to amend should be freely granted where the proposed amendment is potentially meritorious and no prejudice to the opposing party has been shown ( see Holchendler, 292 AD2d at 569; Dal Youn Chung v Farberov, 285 AD2d 524, 525). While defendants now claim that they have been prejudiced by this amendment, they have not demonstrated how they have been prejudiced at this early pleadings stage of the action, with discovery still to be conducted ( see generally McCaskey, Davies Assoc. v New York City Health Hosps. Corp., 59 NY2d 755, 757; Hilltop Nyack Corp. v TRMI Holdings, 275 AD2d 440, 441).Thus, the court finds that inasmuch as defendants have failed to demonstrate that this court misapprehended the law or facts and are simply rehashing arguments already considered and rejected by the court, their motion for reargument must be denied ( see CPLR 2221 [d]; Foley, 68 AD2d at 567; American Trading Co., 87 Misc 2d at 195).
Moreover, this court's October 17, 2006 decision and order has already been affirmed by the Appellate Division, Second Department, in a decision and order by it dated April 8, 2008 ( Dialcom, LLC v AT T Corp. , 50 AD3d 727, 727). Indeed, the Appellate Division, Second Department, in affirming this court's October 17, 2006 decision and order, expressly held that this court "properly granted that branch of plaintiff's motion which was for leave to amend the complaint ( id.). In so holding, the Appellate Division, Second Department, specifically found that defendants "failed to establish prejudice or surprise" by the amending of plaintiff's first amended complaint, and that "the claims in the proposed [second] amended complaint are not palpably insufficient or duplicative of any previously dismissed claims" ( id.).
Defendants' motion seeks, in the alternative, dismissal of plaintiff's first, fourth, and sixth causes of action of its second amended complaint. Plaintiff's first cause of action alleges that the IDT $750 Million Revenue-Commitment Contract was procured directly as a result of its marketing efforts, and that the MAA obligated Concert to pay it a 2% commission on all revenue amounts actually billed and collected by Concert as a result of its marketing efforts, as well as a maximum bonus commission of .5 percent of all revenue generated under the IDT $750 Million Revenue-Commitment Contract, even if Concert transitioned this IDT account in-house. Plaintiff asserts that Concert materially breached the MAA by failing to pay it the 2% commission and bonus commissions under the MAA in connection with the IDT $750 Million Revenue-Commitment Contract.
Defendants, in seeking dismissal of plaintiff's first cause of action, maintains that it is time-barred, pursuant to the MAA's one-year Statute of Limitations, set forth in paragraph 15 thereof, which states that "[a]ny legal action arising from or in connection with this Agreement must be brought within one (1) year after the cause of action arises." They assert that to the extent plaintiff's first cause of action involves transactions occurring prior to April 2, 2002 (more than one year before plaintiff filed this action), it must be dismissed, pursuant to CPLR 3211 (a) (5), as time-barred.
With regard to the IDT claim in plaintiff's second amended complaint (in contrast to the claims analyzed under the court's July 20, 2004 order), however, the point at which the Statute of Limitations began to accrue with respect to defendants' failure to compensate plaintiff 2% (plus bonuses) of the IDT $750 Revenue-Commitment Contract, had nothing to do with when defendants transitioned account management of IDT away from plaintiff. Rather, the Statute of Limitations accrued at some point after revenue from the IDT $750 Million Revenue-Commitment Contract was "actually billed and collected by Concert." Plaintiff's second amended complaint alleges that due to Concert's internal inefficiencies, it was routinely behind in billing, collecting, and processing, and, consequently, in making payments to plaintiff. It further alleges that Concert informed plaintiff that due to the unusually large and complex nature of the IDT $750 Million Revenue-Commitment Contract, it would take Concert even longer than its usual delays to bill, collect, and process the revenue amounts in connection with that contract, and that it could not specify a date when plaintiff would be paid. Plaintiff's second amended complaint also alleges that it was not until October 2002 that AT T, for the first time, informed plaintiff that it would not be paid a 2% commission or any bonus commission for the IDT $750 Million Revenue-Commitment Contract. Plaintiff points out that under the plain language of the MAA, Concert was entitled to process the billing invoice on one date, bill the customer on a later date, collect revenue on yet another date, and still not have a date certain by which it was obligated to pay plaintiff its 2% commission. Plaintiff maintains that, therefore, defendants have failed to demonstrate that the MAA specifies when, how long, or at what point after Concert "actually billed and collected" the "total revenue amount" on the IDT account that Concert's payment obligation to it actually became due.
Defendants, in response, have not put forth any evidence or even alleged when, if ever, Concert "actually billed and collected" revenue from the IDT account, and do not dispute, or even address, the supplemental IDT allegations in any manner. Defendants, instead, in their reply papers, argue that the MAA specifies a discernable accrual date from which the contractual Statue of Limitations period can be measured. They argue that their obligation to plaintiff arose either immediately upon their collection of revenue or that an accrual date for the IDT claim can be found in section 7 of the MAA, which provides that "unless otherwise set forth in the relevant Service Attachment, [f]ees shall be paid by Concert within forty-five (45) days after customer billing invoice has been processed." While the term "processing" contained in section 2(a) is undefined, defendants equate the "process[ing]" of "billing invoices" with the "collection" of revenue, and argue that their obligation to pay plaintiff a 2% commission on the IDT $750 Revenue-Commitment Contract accrued either at the moment Concert "collected" any revenue under that contract or 45 days thereafter.
The proper analysis for when a breach of contract accrues, however, is not when the obligation arose, but when the contract is breached or when the promisor omits performance of an obligation ( see John J. Kassner Co. v City of New York, 46 NY2d 544, 550; Lamendola v Mossa, 190 Misc 2d 147, 149; Edwards v State of New York, 95 Misc 2d 516, 520 [1978]). Here, defendants have not shown when they were obligated under the MAA to "collect" this revenue, nor have they offered any evidence as to when the "total revenue amount," or even any revenue, on the IDT $750 Million Revenue-Commitment Contract was "actually billed and collected by Concert."
"On a CPLR 3211 motion [to dismiss] a complaint,' including a motion pursuant to CPLR 3211 (a) (5) . . ., a court must take the allegations as true and resolve all inferences which reasonably flow therefrom in favor of the pleader'" ( AAA Viza, Inc. v Business Payment Sys., LLC , 38 AD3d 802 , 803, quoting Cron v Hargro Fabrics, 91 NY2d 362, 366; see also Island ADC , Inc. v Baldassano Architectural Group, P.C. , 49 AD3d 815 , 816; Sabadie v Burke , 47 AD3d 913 , 914; Matter of Schwartz , 44 AD3d 779 , 779; Gutman v Klein , 26 AD3d 464 , 464). Here, at a bare minimum, the record is replete with issues of fact as to when the IDT claim accrued, precluding dismissal of plaintiff's first cause of action at the pleadings stage ( see Sabadie, 47 AD3d at 914; Matter of Schwartz, 44 AD3d at 779; Gutman, 26 AD3d at 464). Thus, since defendants have not demonstrated that plaintiff's first cause of action is time-barred by the Statute of Limitations, it must, at this pleadings stage of the action, be sustained ( see Island ADC, Inc., 49 AD3d at 816; Sabadie, 47 AD3d at 914; Matter of Schwartz, 44 AD3d at 779-780; Barlow v Sun Chem. Co. , 15 Misc 3d 953 , 967).
Plaintiff's fourth cause of action for quasi-contract/quantum meruit/unjust enrichment as to the Qwest account alleges that from December 31, 1999 until April 1, 2000, plaintiff performed agency services for defendants in good faith, without a formal written contract, and that in January 2000, it procured Qwest as a customer for and on behalf of Concert. It further alleges that in March 2000, Concert transitioned from plaintiff management of the Qwest account in-house, and began servicing it directly, without compensating plaintiff for any of plaintiff's marketing efforts, commissions, or other agency services rendered in connection with the procurement of the Qwest account. It sets forth that by accepting and retaining the services provided by plaintiff in procuring the Qwest account and the revenues the Qwest account generated, without compensating plaintiff, defendants have been unjustly enriched at plaintiff's expense, and plaintiff is entitled to recovery in quasi-contract, quantum meruit, and/or unjust enrichment to recover the value of the benefits conferred by plaintiff upon defendants.
To plead a quantum meruit claim, the complaint must allege "(1) the performance of the services in good faith, (2) the acceptance of the services by the person to whom they were rendered, (3) an expectation of compensation therefor, and (4) the reasonable value of the services" ( Atlas Refrigeration — Air Conditioning, Inc. v Lo Pinto, 33 AD3d 639, 640). Defendants do not dispute that plaintiff has alleged these requisite elements. Rather, defendants argue that since there is an express written agreement, i.e., the MAA, covering the subject matter of plaintiff's claims as to Qwest, a quasi-contract claim for quantum meruit fails as a matter of law.
It is true that where there is an express written agreement governing the same subject matter of a plaintiff's claims, a quasi-contract claim for quantum meruit cannot be sustained ( see Clark-Fitzpatrick, Inc. v Long Island R.R. Co., 70 NY2d 382, 388; Lum v New Century Mtge. Group , 19 AD3d 558 , 560). Here, however (as noted above), plaintiff's fourth cause alleges that plaintiff procured the Qwest account in January 2000, 10 months before the MAA was executed, and three months before the MAA's retroactive effective date of April 1, 2000, and that plaintiff serviced the Qwest account up until March 2000, when it was transitioned. During this time period from January through March 2000, prior to the April 2000 effective date of the MAA, but after the December 31, 1999 expiration date of the SAA, there was no written agreement between the parties. Therefore, plaintiff's fourth cause of action pleads a claim not covered by and which is outside the scope of the subject matter of the MAA ( see Clark-Fitzpatrick, Inc., 70 NY2d at 388-389; R.I. Island House, LLC v North Town Phase II Houses, Inc., ___ AD3d ___, 2008 NY Slip Op 04672, *5 [2008]; Hochman v LaRea , 14 AD3d 653 , 655; Zuccarini v Ziff-Davis Media, 306 AD2d 404, 405; Old Salem Dev. Group v Town of Fishkill, 301 AD2d 639, 639; Parkash v Utilisave Corp., 295 AD2d 330, 330; Sforza v Health Ins. Plan of Greater NY, 210 AD2d 214, 215).
Defendants also argue that plaintiff's quantum meruit claim should be dismissed because plaintiff purportedly previously conceded that the MAA controls its claims relating to Qwest. Contrary to this argument, plaintiff, in paragraph 30 of its first amended complaint, alleged at the outset of this action and it has consistently maintained that it procured the Qwest account in January 2000, three months before the MAA's retroactive effective date of April 1, 2000. This is entirely consistent with plaintiff's present quantum meruit claim. Thus, plaintiff's amended claim asserting this theory of recovery is based upon the same underlying facts alleged in plaintiff's first amended complaint ( see Bobrowsky v Lexus, 215 AD2d 424, 424).
Defendants additionally argue that plaintiff's fourth cause of action for quantum meruit is precluded based upon a merger clause set forth in section 12 of the MAA, which provides:
"The terms and conditions contained in this Agreement constitute the entire Agreement between the parties hereto and supersede all prior oral or written understandings between the parties concerning its subject matter."
Such a boiler-plate merger clause, however, "merely prevents one party from alleging oral misrepresentations which directly contradict the language of the agreement signed by the party" ( Chase v Columbia Nat. Corp., 832 F Supp 654, 662 [SD NY 1993]). Here, since, plaintiff's quantum meruit claim as to Qwest arises from conduct and transactions occurring in January through March 2000, when there was no written agreement between the parties, it does not allege or rely upon any oral misrepresentations which directly contradict the language of the MAA ( see id.). The terms of the MAA are not inconsistent with plaintiff's quantum meruit claim as it was expressly made retroactive only to April 2000, not January 2000, when plaintiff procured the Qwest account.
Moreover, while the merger clause bars all prior oral understandings between the parties "concerning [the MAA's] subject matter," the MAA makes no specific reference to the Qwest account and there is no indication in the MAA that the Qwest account was intended to be encompassed as part of the MAA's "subject matter." There also has been no evidence submitted by defendants suggesting that the Qwest account was part of the "subject matter" of the MAA.
Defendants argue that the fact that the MAA was explicitly made retroactive only to January 2000 does not indicate that the merger clause is inapplicable to plaintiff's claim as to Qwest because the purpose of a merger clause is to ensure that the governing contract supersedes all prior agreements. Such argument is rejected. The merger clause at issue is only operative with respect to prior negotiations and "understandings" which culminated in the MAA in which the merger clause is contained; in the absence of any specific language to the contrary, it does not operate to bar prior independent understandings or oral agreements not encompassed within the scope of the MAA ( see Wattenberg v Wattenberg, 277 AD2d 69, 69; Gordon v Patchogue Surgical Co., 222 AD2d 651, 651).
Thus, inasmuch as the Qwest account, which, as noted above, was procured and transitioned prior to the MAA, was outside the scope of the subject matter of the MAA, the boiler-plate merger clause at issue cannot operate to bar plaintiff's quantum meruit recovery with respect to the Qwest account ( see Chase, 832 F Supp at 662; Gordon, 222 AD2d at 651; Urban Holding Corp. v Haberman, 162 AD2d 230, 231; 22A NY Jur 2d, Contracts § 491). Therefore, defendants' motion, insofar as it seeks dismissal of plaintiff's fourth cause of action, must be denied ( see Frank v Sobel , 38 AD3d 229 , 230; Hochman, 14 AD3d at 655; Zuccarini, 306 AD2d at 405; Old Salem Dev. Corp., 301 AD2d at 639; Parkash, 295 AD2d at 330; Sforza, 210 AD2d at 215; Dabrowski v ABAX Inc., 19 Misc 3d 1134 [A], 2008 NY Slip Op 51005 [U],*4 [2008]; CoE Assoc., LLC v Regulus Intl. Capital Co., Inc., 7 Misc 3d 1002 [A], 2004 NY Slip Op 51861 [U], *3 [2004]).
With respect to plaintiff's sixth cause of action for breach of the covenant of good faith and fair dealing, defendants argue that this claim is duplicative of plaintiff's breach of contract claims, and must, therefore, be dismissed. In addressing this argument, it is noted that "[i]mplicit in all contracts is a covenant of good faith and fair dealing in the course of contract performance" ( Dalton v Educational Testing Serv., 87 NY2d 384, 389; see also Van Valkenburgh, Nooger Neville v Hayden Publ. Co., 30 NY2d 34, 45). "The covenant requires that neither party will take any action which may "have the effect of destroying or injuring the right[s] of the other party to receive the fruits [or benefits] of the contract" ( 511 W. 232nd Owners Corp. v Jennifer Realty Co., 98 NY2d 144, 153, quoting Dalton, 87 NY2d at 389; see also Gross v Empire Healthchoice Assur., Inc., 12 Misc 3d 1155 [A], 2006 NY Slip Op 50903 [U],* 4 [2006]; Guggenheimer v Bernstein Litowitz Berger Grossmann LLP, 11 Misc 3d 926, 932).
Thus, to plead a breach of the covenant of good faith and fair dealing independent of contract claims, a "plaintiff must allege facts that tend to show that the defendant sought to prevent performance of the contract or to withhold its benefits from the plaintiff" (PJI 4:1; see also Richbell Info. Servs. v Jupiter Partners, 309 AD2d 288, 303). Furthermore, in the context of such a claim "[a] determination of bad faith or willful or negligent disregard of the rights of the other party is generally a question of fact" ( Gross, 2006 NY Slip Op 50903 [U],* 4). Moreover, it has been held that a claim for breach of the implied covenant of good faith and fair dealing can be maintained, even though it arises from the same underlying transactions and occurrences as a breach of contract claim, where it contains allegations that "are not duplicative of [the] plaintiff['s] contract claims, but are claims that acts perpetrated by defendants deprived [the] plaintiff . . . of the fruits of the contract" ( A. Brod, Inc. v Worldwide Dreams, LLC, 4 Misc 3d 1006 [A], 2004 NY Slip Op 50733 [U],*2 [2004]).
In the case at bar, the crux of plaintiff's sixth cause of action is defendant's alleged overall scheme to prevent performance of the entire MAA and withhold its benefits from plaintiff. Specifically, plaintiff's sixth cause of action is premised upon allegations that defendants, among other things, engaged in a willful and bad faith effort to circumvent the entire MAA and deprive plaintiff of the benefits thereof by having AT T, instead of Concert, actually bill and collect revenue from the accounts, employing an intentional and bad faith pattern of pervasive billing inefficiencies and delay, and transitioning the management of accounts for the sole, bad faith purpose of depriving plaintiff of commissions and bonuses under Service Attachment One. Thus, plaintiff sufficiently alleges that defendants' actions were designed to deprive him of the benefits of the MAA and frustrated his rights and reasonable expectations to receive such benefits under the MAA ( see Richmond Shop Smart, Inc. v Kenbar Dev. Ctr., LLC , 32 AD3d 423 , 424; Richbell Info. Servs., 309 AD2d at 302-303; 1-10 Indus. Assoc. v Trim Corp. of Am., 297 AD2d 630, 631-632; Wallace v Merrill Lynch Capital Servs., Inc., 10 Misc 3d 1062 [A], 2005 NY Slip Op 52076 [U], *6 [2005], affd 29 AD3d 382; A. Brod, Inc., 2004 NY Slip Op 50733 [U], *2).
Therefore, while plaintiff's sixth cause of action and its breach of contract claims involve some overlap, they consist of distinct, non-duplicative, independent claims ( see Richmond Shop Smart, Inc., 32 AD3d at 424). Consequently, inasmuch as the allegations set forth in plaintiff's sixth cause of action suffice to state a cause of action to recover damages for breach of the implied covenant of good faith and fair dealing by defendants, defendants' motion, insofar as it seeks dismissal of plaintiff's sixth cause of action, must be denied.
Accordingly, defendants' motion is denied in its entirety, and defendants are directed to serve an answer to plaintiff's second amended complaint within 10 days after service of notice of entry of this order.
This constitutes the decision and order of the court.