Opinion
15544 Index No. 654227/18 Case No. 2021-02501
03-17-2022
Johnny PEREZ et al., Plaintiffs-Respondents, v. LONG ISLAND CONCRETE INC. et al., Defendants-Appellants, Lanmark Group, Inc., Defendant.
Cermele & Wood LLP, White Plains (Benjamin M. Rattner of counsel), for Long Island Concrete Inc., Thomas J. Perno, TJM Construction Corp., ZHL Group Inc., The Guarantee Company of North America USA, Vigilant Insurance Company and The Ohio Casualty Company, appellants. William A. Thomas, New York, for Regulator Construction Corp., appellant. Arenson, Dittmar & Karban, New York (Avi Mermelstein of counsel), for respondents.
Cermele & Wood LLP, White Plains (Benjamin M. Rattner of counsel), for Long Island Concrete Inc., Thomas J. Perno, TJM Construction Corp., ZHL Group Inc., The Guarantee Company of North America USA, Vigilant Insurance Company and The Ohio Casualty Company, appellants.
William A. Thomas, New York, for Regulator Construction Corp., appellant.
Arenson, Dittmar & Karban, New York (Avi Mermelstein of counsel), for respondents.
Kapnick, J.P., Mazzarelli, Friedman, Gesmer, Oing, JJ.
Order, Supreme Court, New York County (Melissa A. Crane, J.), entered on or about June 2, 2021, which, to the extent appealed from as limited by the briefs, denied defendants’ motions to dismiss plaintiffs’ first, third, fourth, and fifth causes of action in the amended complaint, unanimously modified, on the law, to dismiss the third cause of action asserting alter ego liability against defendant Regulator Construction Corporation (Regulator), and otherwise affirmed, without costs.
Plaintiffs sufficiently alleged a cause of action for breach of contract as third-party beneficiaries of public works contracts entered into by defendant Long Island Construction Corp. (LIC) (see Cox v. NAP Constr. Co., Inc., 10 N.Y.3d 592, 601, 608, 861 N.Y.S.2d 238, 891 N.E.2d 271 [2008] ; see also Dabrowski v. Abax Inc., 64 A.D.3d 426, 427, 882 N.Y.S.2d 119 [1st Dept. 2009] ). Plaintiffs alleged that they had worked on 12 construction projects that were commissioned through public works contracts with LIC. Moreover, by alleging that they were supervised by LIC foremen, that their rate of pay was set by LIC's Chief Operating Officer, defendant Thomas J. Perno, and that they were, at some point, issued LIC paychecks, they have sufficiently established that they were employed by LIC and/or Perno while working on those projects. They further alleged that they were not paid the prevailing wages, overtime premiums, or supplemental benefits, as required by the contracts (see Singh v. Zoria Hous., LLC, 163 A.D.3d 1025, 1025–1026, 83 N.Y.S.3d 488 [2d Dept. 2018] ).
The documentary evidence submitted by defendants is insufficient to resolve all factual disputes as to whether the public works contracts governing plaintiffs’ work sites incorporated project labor agreements (PLAs) that contained exclusive dispute resolution procedures, and whether plaintiffs were bound by them (see Matter of Wonder Works Constr. Corp. v. R.C. Dolner, Inc., 73 A.D.3d 511, 513–514, 901 N.Y.S.2d 30 [1st Dept. 2010] ). Since defendants failed to show that plaintiffs ever saw the PLAs or assented to their terms, they have failed to establish conclusively, at this juncture, that the PLAs are binding on them (see Matter of Belzberg v. Verus Invs. Holdings, Inc., 21 N.Y.3d 626, 631, 977 N.Y.S.2d 685, 999 N.E.2d 1130 [2013] ; see also Ansah v. A.W.I. Sec. & Investigation, Inc., 129 A.D.3d 538, 539, 12 N.Y.S.3d 35 [1st Dept. 2015] ).
Furthermore, plaintiffs sufficiently alleged that defendant Regulator is the alter ego of defendants LIC and/or Perno and may also be held liable for breach of contract ( Baby Phat Holding Co., LLC v. Kellwood Co., 123 A.D.3d 405, 407, 997 N.Y.S.2d 67 [1st Dept. 2014] ). The complaint alleged, among other things, that plaintiffs received paychecks issued by LIC and Regulator; that the companies shared the same concrete construction superintendent; that Regulator trucks were seen on LIC's yards; and that LIC personnel handled paychecks issued by Regulator. Moreover, plaintiffs assert that the president of Regulator reported to the president of LIC, where he was also a foreman. Those facts are sufficient, at the pleading stage, to frame issues about whether these defendants "commingled funds and disregarded corporate formalities" ( Baby Phat, 123 A.D.3d at 407, 997 N.Y.S.2d 67 ; see also Schnell Contr. Sys. L.L.C. v. Empire Outlet Bldrs. LLC, 198 A.D.3d 548, 548–549, 152 N.Y.S.3d 812 [1st Dept. 2021] ). However, since alter ego liability is not an independent cause of action (see Ferro Fabricators, Inc. v. 1807–1811 Park Ave. Dev. Corp., 127 A.D.3d 479, 480, 11 N.Y.S.3d 548 [1st Dept. 2015] ), plaintiffs’ third cause of action against Regulator should be dismissed.
Plaintiffs’ claims against defendants relate back to the filing of the original complaint, as it asserted causes of action for breach of contract related to defendants’ alleged failure to pay prevailing wages on three public works projects, which sufficiently put them on notice of the transactions or occurrences to be proved pursuant to the amended complaint (see O'Halloran v. Metropolitan Transp. Auth., 154 A.D.3d 83, 87–89, 60 N.Y.S.3d 128 [1st Dept. 2017] ). Similarly, the claims against Regulator potentially relate back to the filing of the original complaint because the amended complaint alleges "some relationship between the parties giving rise to the vicarious liability of one for the conduct of the other" ( Vanderburg v. Brodman, 231 A.D.2d 146, 147–148, 660 N.Y.S.2d 438 [1st Dept. 1997] ).