Opinion
No. CV–012764–15.
03-23-2016
TROIANO FUEL OIL CO INC., Plaintiff(s) v. The CHILDREN'S SAFARI LLC and Theresa F. Robinson–Dimilia, Defendant(s).
Jeffrey A. Maidenbaum, Esq., Maidenbaum & Associates, P.L.L.C., Merrick, Attorney for Plaintiff. Mark Krassner, Esq., Borah, Goldstein, Altschuler, Nahins & Goidel, P.C., New York, Attorney for Defendant.
Jeffrey A. Maidenbaum, Esq., Maidenbaum & Associates, P.L.L.C., Merrick, Attorney for Plaintiff.
Mark Krassner, Esq., Borah, Goldstein, Altschuler, Nahins & Goidel, P.C., New York, Attorney for Defendant.
SCOTT FAIRGRIEVE, J.
The following named papers numbered 1 to 3 submitted on this Motion on March 8, 2016
Papers/Numbered
Notice of Motion and Supporting Documents 1
Order to Show Cause and Supporting Documents
Opposition to Motion 2
Reply Papers to Motion 3
The Plaintiff moves for summary judgment on the grounds that Defendants are liable for delivery of oil to Defendant, The Children's Safari LLC, located at 6 Rockaway Avenue, Valley Stream, in the sum of $5,874.05. Defendants deny liability.
In support of its motion for summary judgment, Plaintiff submits the affidavit of its President, Vito Troiano, dated December 15, 2015. Plaintiff further submits the Oil Burner Service Agreement with the effective dates of 12/27/05 to 12/27/06, wherein Plaintiff agreed to service the Children's Safari LLC “oil burner as required and to respond to all emergency service calls.” Also, Plaintiff agreed to replace or repair, without additional charge, certain parts which may become defective.
Plaintiff also submits the Residential Credit Application, dated December 27, 2005. The application states that this document pertains to the following:
“CREDIT APPLICATION AND CONTRACT TO PURCHASE FUEL OIL THROUGH TEMPERATURE CONTROL DELIVERIES AND/OR PLUMBING RELATED SERVICE.”
The Corporate Account is listed for The Children's Safari LLC. The application was executed by Theresa F. Robinson–Dimilia. Above her signature appears the following:
“A. DO NOT SIGN BEFORE YOU HAVE READ AGREEMENT PRINTED ON REVERSE SIDE.
B. YOU ARE ENTITLED TO A COPY OF THIS AGREEMENT AND THE INFORMATION REGARDING YOUR RIGHTS TO DISPUTE BILLING ERRORS.
BUYER(S) HEREBY ACKNOWLEDGES RECEIPT OF A TRUE COPY OF THIS AGREEMENT AND BILLING ERRORS INFORMATION.
I PERSONALLY GUARANTEE ANY DEBT INCURRED BY CORPORATE ACCOUNT TITLE.”
Thus, the Defendant assumed liability for the fuel oil purchased.
The application also provides for service charges, in paragraph 4 as follows:
“SERVICE CHARGES:Unless you paid the previous balance shown on your monthly statement in full by its payment due date, a SERVICE CHARGE will be added to your purchases account from the date of purchase and these SERVICE CHARGES will be computed in the following way:
(a). We start with the previous balance of your purchases account at the beginning of the billing period.
(b). Each day of the period we subtract payments and credits and add purchases, giving us the daily balance.
(c). We then average the daily balance (called “balance subject to SERVICE CHARGE”) and multiply this average by the following monthly periodic rates: 1½% on balance over 60 days, which is an ANNUAL PERCENTAGE RATE of 18%.”
Paragraph 5 provides for attorney fees and court costs in the event of a default:
“DEFAULT AND COLLECTION COSTS: You will be in default if you do not pay a balance on time, file for bankruptcy, or make an assignment for the benefit of creditors. Default means we can demand immediate payment of the full balance. If we refer collection of the balance to a lawyer, you will pay attorneys fees plus court costs.”
Also attached is the Customer Account Transactions Listing for Children's Safari LLC, starting April 1, 2013 through June 30, 2014, showing a balance owed of $5,874.05. Plaintiff claims that The Children's Safari LLC, paid late and maintained a running balance. Bills were sent to Defendant without objection and created an account stated.
Defendants vehemently oppose the motion for summary judgment. The affidavit of Theresa F. Robinson–Dimilia states that The Children's Safari LLC went out of business on or about November 11, 2014. Defendants claim that they were not aware of the balance being claimed by Plaintiff. As of November 11, 2014, Defendant Theresa F. Robinson–Dimilia became aware of the claim upon receipt of the pleadings.
Defendant Theresa F. Robinson–Dimilia states that she didn't personally receive bills or invoices. Defendant Theresa F. Robinson–Dimilia attacks the omission of billing statements from the moving papers, claiming that same prevents the court from determining the validity of the amounts claimed.
Defendant Theresa F. Robinson–Dimilia complains that the alleged guaranty is not attached or made a part of the Oil Burner Service Agreement. Furthermore, the guaranty does not state that the guaranty is effective for any renewals or extensions. The Oil Burner Service Agreement has a term of 1/27/05 to 12/27/06. Defendant Theresa F. Robinson–Dimilia contends that the alleged guaranty “is not effective for any time period after 12/27/06, if it was even effective (which I deny).” Since the period in question starts April 1, 2013 and ends March 30, 2014, the guaranty has no validity to impose personal liability.
Plaintiff submits the reply affidavit of Vito Troiano, President, sworn to on February 21, 2016. He states that Defendants were aware of all deliveries because “a section of our 3 part ticket was left at the premises.” An invoice was generated the next business day and sent to the Defendants. The invoices included the delivery date, gallons delivered, price and total due. On the first of each month, a statement of account was sent to Defendant, The Children's Safari LLC, at 6 Rockaway Avenue in Valley Stream. There was never any protest from Defendants concerning the invoices.
Plaintiff provides delivery tickets dated:
1. 1/9/13
2. 4/23/13
3. 10/30/13
4. 11/20/13
5. 12/12/13
6. 1/24/14
7. 2/14/14
8. 2/26/14
9. 3/6/14
10. 3/19/14
11. 4/1/13
Plaintiff answers Defendants claims of no liability as follows:
“The Defendant claims that there was a one year limit on her guaranty. Nothing in any of the documents that are a part of this action limit the guaranty to one year. The Defendant never cancelled our service as set forth in the agreement. Using the Defendant's logic, after the first year they wouldn't be responsible to pay for anything. The Defendant received oil from us and failed to pay for it. There is nothing in her papers to state there is a dispute. Exhibit “C” to the original motion shows the dates that account statements were mailed to the Defendant. There is no denial of receipt of those statements by the Defendant and therefore there cannot be a legitimate dispute to this action.”
Decision
Plaintiff contends that Defendant Theresa F. Robinson–Dimilia is liable because it is clear that she signed the credit application which provided for her personal liability in the event of a default by the LLC. Defendant denies the effectiveness of her signature as a guaranty. Furthermore, Defendant Theresa F. Robinson–Dimilia contends that even if the court finds that the signature operates as a guaranty, it is not effective because the Oil Burner Service Agreement ended on 12/27/06 and, therefore, she can't have liability for any period afterwards.
In Paribas Properties, Inc. v. Benson, 146 A.D.2d 522, 536 N.Y.S.2d 1007 (1st Dept 1989), the Court noted the following rule for an agent to be held individually liable:
“Under the longstanding rule in New York, an agent who signs an agreement on behalf of a disclosed principal will not be held responsible for its performance “unless there is clear and explicit evidence of the agent's intention to substitute or superadd his personal liability for, or to, that of his principal” (Mencher v. Weiss, 306 N.Y. 1, 4, 114 N.E.2d 177 [1953] ; Savoy Record Co. v. Cardinal Export Corp., 15 N.Y.2d 1, 4–6, 254 N.Y.S.2d 521, 203 N.E.2d 206 [1964] ; Boas & Assoc. v. Vernier, 22 A.D.2d 561, 563, 257 N.Y.S.2d 487 [1965] ; Matter of Jevremov, 129 A.D.2d 174, 176 517 N.Y.S.2d 496 [1987] ).”
The Paribas court discussed the rationale of Salzman Sign Co. v. Beck, 10 N.Y.2d 63, 217 N.Y.S.2d 55 (1961), wherein the Court refused to enforce the guaranty which was a single sentence in a long contract and the individual only signed as a corporate officer. It was further noted that the Salzman Court recognized the universal practice of having the individual sign in his representative capacity and again individually. The Paribas Court distinguished its factual situation from that presented in Salzman, in that the contract was only three pages long and the guaranty appeared distinctly above the signature. One signature could be enough to impose liability unlike the situation in Salzman. Thus the Court found that issues of fact existed which required a trial.
In Mencher v. Weiss, 306 N.Y. 1 (1953), the Court held that the defendant Weiss was personally liable on the guaranty by signing one time, on the contract where the printed word member appeared on the same line. The agreement provided that a member could be held individually liable for wages, vacation pay and welfare and pension benefits due employees under a collective labor agreement. The Court further held that a person is bound by the contents of the contract he or she signs.
In LG Funding, LLC v. Florida Tilt, Inc., 2015 WL 4390453, the Court noted that under New York Law there is no barrier to impose personal liability under New York Law for corporate debt:
“So long as the guaranty signed is unambiguous, there is no barrier under New York law to personal liability for corporate debt.”
This case is distinguishable from Yellow Book Sales and Distribution Co., Inc. v. RS Builders, Inc., 41 Misc.3d 146(A), 2013 N.Y. Slip Op 52104(U), 2013 WL 6569870, wherein the defendant Siguencia signed the agreement which contained the following clause:
“Authorized Signature Individually and for the Company (Read clause 15F on reverse side).”
The clause imposing liability was on the reverse side of the contract in small, light gray print, containing a full page of terms and conditions.
In the case at bar, the guaranty appears in full cap letters directly above the signature of Theresa F. Robinson–Dimilia on a one page document.
Based upon the above, issues of fact exist requiring a trial on the issues of the effectiveness of the signature as a guaranty.
This case is set down for immediate trial on the above issues on April 26, 2016, at 10:00 a.m. All parties and counsel are directed to appear before the court at that time, ready to proceed to trial.
So Ordered.