Opinion
2021-05185
10-01-2021
DUNN AUTO PARTS, INC., PLAINTIFF-RESPONDENT, v. WILLIAM E. WELLS, DOING BUSINESS AS BILL'S AUTO WRECKING, DEFENDANT-APPELLANT.
TREVETT CRISTO, ROCHESTER (DAVID H. EALY OF COUNSEL), FOR DEFENDANT-APPELLANT. BARCLAY DAMON LLP, BUFFALO (SARAH A. O'BRIEN OF COUNSEL), FOR PLAINTIFF-RESPONDENT.
TREVETT CRISTO, ROCHESTER (DAVID H. EALY OF COUNSEL), FOR DEFENDANT-APPELLANT.
BARCLAY DAMON LLP, BUFFALO (SARAH A. O'BRIEN OF COUNSEL), FOR PLAINTIFF-RESPONDENT.
PRESENT: WHALEN, P.J., LINDLEY, CURRAN, AND DEJOSEPH, JJ.
Appeal from an order of the Supreme Court, Orleans County (Henry J. Nowak, J.), entered September 3, 2019. The order, insofar as appealed from, granted that part of plaintiff's cross motion seeking summary judgment dismissing defendant's third counterclaim.
It is hereby ORDERED that the order insofar as appealed from is unanimously reversed on the law without costs, that part of plaintiff's cross motion seeking summary judgment dismissing the third counterclaim is denied, and that counterclaim is reinstated.
Memorandum: The parties entered into a contract for plaintiff to purchase defendant's property and automobile scrapping business for a set amount of money. Pursuant to the terms of the contract, defendant would continue to reside in a residence on the property and, for a period of "up to 6 months," would "maintain property taxes in lieu of rent." If defendant remained in the residence "for longer than the 6[-]month period, then [defendant] [would] be required to pay a monthly rent of $800.00 to [plaintiff]." The contract was silent with respect to who was required to pay the property taxes following the initial, six-month period. Inasmuch as no one paid the taxes for several years after the initial six-month period and defendant remained the titled owner of the property, defendant received a notice of foreclosure in December 2015. In an effort to avoid a tax auction, defendant paid the taxes and interest.
Aside from the property tax issue, there were other disputes between the parties, who never closed on the real estate transaction. Ultimately, plaintiff commenced this action seeking, inter alia, specific performance of the contract and damages. Defendant answered and asserted various counterclaims, including the third counterclaim, which sought reimbursement for the property taxes and interest paid by defendant.
After defendant moved to compel certain discovery, plaintiff cross-moved for summary judgment in its favor on its five causes of action and dismissing certain counterclaims. Supreme Court granted plaintiff's cross motion to the extent that it sought dismissal of the first and third counterclaims. Defendant appeals from only that part of the order dismissing the third counterclaim. We agree with defendant that the court erred in dismissing the third counterclaim.
It is well settled that" '[i]nterpretation of an unambiguous contract provision is a function for the court, and matters extrinsic to the agreement may not be considered when the intent of the parties can be gleaned from the face of the instrument'" (Chimart Assoc. v Paul, 66 N.Y.2d 570, 572-573 [1986]; see Greenfield v Philles Records, 98 N.Y.2d 562, 569 [2002]). The determination whether a contract is ambiguous "is an issue of law for the courts to decide" (Greenfield, 98 N.Y.2d at 569; see Ames v County of Monroe, 162 A.D.3d 1724, 1725-1726 [4th Dept 2018]). "A contract is unambiguous if the language it uses has 'a definite and precise meaning, unattended by danger of misconception in the purport of the [agreement] itself, and concerning which there is no reasonable basis for a difference of opinion'" (Greenfield, 98 N.Y.2d at 569; see Ames, 162 A.D.3d at 1726). "A contract is ambiguous, however, when on its face it 'is reasonably susceptible of more than one interpretation'" (Matter of Wilson, 138 A.D.3d 1441, 1442 [4th Dept 2016], quoting Chimart Assoc., 66 N.Y.2d at 573).
We agree with defendant that the contractual provisions regarding who was obligated to maintain property taxes after the initial six-month period are ambiguous and cannot be resolved by the courts inasmuch as the" 'determination of the intent of the parties depends on the credibility of extrinsic evidence or on a choice among reasonable inferences to be drawn from extrinsic evidence'" (id. at 1443).
Inasmuch as "a contract generally incorporates the state of the law in existence at the time of its formation" (Travelers Indem. Co. v Orange & Rockland Utils., Inc., 73 A.D.3d 576, 577 [1st Dept 2010], lv dismissed 15 N.Y.3d 834 [2010]), defendant, as the titled owner, would have been responsible for the property taxes, absent a contractual provision to the contrary. Here, however, the contract was not truly silent on the issue of property taxes. It specifically provided that defendant would pay property taxes in one situation but then failed to address who would pay the property taxes in another situation (see generally Reiss v Financial Performance Corp., 279 A.D.2d 13, 21 [1st Dept 2000], mod on other grounds 97 N.Y.2d 195 [2001]). Based on the maxim expressio unius est exclusio alterius, which applies to contracts as well as statutes (see Quadrant Structured Prods. Co., Ltd. v Vertin, 23 N.Y.3d 549, 560 [2014]), "[w]here a [document] describes the particular situations in which it is to apply, an irrefutable inference must be drawn that what is omitted or not included was intended to be omitted and excluded" (Village of Webster v Town of Webster, 270 A.D.2d 910, 912 [4th Dept 2000], lv dismissed in part and denied in part 95 N.Y.2d 901 [2000] [internal quotation marks omitted]; see McKinney's Cons Laws of NY, Book 1, Statutes § 240; Town of Aurora v Village of E. Aurora, 32 N.Y.3d 366, 372-373 [2018]). Inasmuch as the determination of the intent of the parties depends on a choice among reasonable inferences, we conclude that resolution of the third counterclaim should be left to a trier of fact. We therefore reverse the order insofar as appealed from and reinstate the third counterclaim.