Superior Site Work, Inc. et al v. Nasdi, LLC et al

Filing 132

MEMORANDUM OF DECISION AND ORDER: For the above stated reasons, NASDI's 122 motion for summary judgment pursuant to Rule 56 dismissing the second amended complaint is granted in part, and denied in part. It is granted to the extent that all of Harrisons and Diversified's claims are dismissed, as are Superior's claims for specific charges, and all claims for extra work, change orders, and profit sharing except for those related to the extra work for open concrete PSI upgrade change orders. It is denied to the extent that Superior's delay claim and claim for final payment survive. SEE ATTACHED DECISION for details. It is SO ORDERED by Judge Arthur D. Spatt on 8/3/2018. (Coleman, Laurie)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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SUPERIOR SITE WORK, INC., DIVERSIFIED
CONSTRUCTION CORP., HARRISON
AVENUE PROPERTIES LLC,
Plaintiffs,

FILED 
CLERK 

3:23 pm, Aug 03, 2018

U.S. DISTRICT COURT 
EASTERN DISTRICT OF NEW YORK 
LONG ISLAND OFFICE 

MEMORANDUM OF
DECISION AND ORDER
2:14-cv-01061 (ADS)(SIL)

-againstNASDI, LLC,
Defendant.
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NASDI, LLC,
Third Party Plaintiff,
-againstCASE FOUNDATION COMPANY, and THE
CITY OF NEW YORK,
Third Party Defendants.
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APPEARANCES:
Zabell & Associates, P.C.
Attorneys for the Plaintiffs
1 Corporate Drive
Suite 103
Bohemia, NY 11716
By:
Saul D. Zabell, Esq., Of Counsel
The Law Office of John E. Osborn, P.C.
Attorneys for the Defendant and Third Party Plaintiff
93–02 Sutphin Boulevard
Jamaica, NY 11435
By:
Daniel H. Crow, Esq., Of Counsel

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Peckar & Abramson
Attorneys for the Third Party Defendant Case Foundation Company
41 Madison Avenue
20th Floor
New York, NY 10010
By:
Alan H. Winkler, Esq., Of Counsel
New York City Law Department, Office of Corporation Counsel
Corporation Counsel for Third Party Defendant the City of New York
100 Church Street
Room 3-124
New York, NY 10007
By:
Amanda M. Papandrea, Assistant Corporation Counsel
SPATT, District Judge:
This action arises out of a contract dispute between the parties. The contract concerned
work related to the Ocean Breeze Indoor Athletic Facility in Staten Island, New York (“Ocean
Breeze” or the “Project”). The City of New York (the “City) and the New York City Department
of Parks and Recreation (the “Parks Department”) contracted with NASDI, LLC (“NASDI”) to
build Ocean Breeze. NASDI allegedly subcontracted with Superior Site Work, Inc. (“Superior”),
Diversified Construction Corp. (“Diversified”), and Case Foundation Company (“Case”).
NASDI allegedly leased office space from Harrison Avenue Properties LLC (“Harrison”)
(together with Superior and Diversified, the “Plaintiffs”) during the Project.
Presently before the Court is a motion by NASDI for summary judgment pursuant to
Federal Rule of Civil Procedure (“FED. R. CIV. P.” or “Rule”) 56 dismissing the Plaintiffs’ claims
against it. For the following reasons, NASDI’s motion is granted in part, and denied in part.
I. BACKGROUND
A. The Relevant Facts
The following facts are drawn from the parties’ respective 56.1 Statements and the
parties’ evidence.

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Initially, the Court notes that both sides often cited to the unverified complaint as
“evidence” in their 56.1 Statements. Complaints that are not verified are not evidence. Marquez
v. City of New York, No. 14-CV-8185 (AJN), 2016 WL 4767577, at *1 n.1 (S.D.N.Y. Sept. 12,
2016) (“On a motion for summary judgment, however, ‘allegations in an unverified complaint
cannot be considered as evidence.’” (quoting Continental Ins. Co. v. Atlantic Cas. Ins. Co., No.
07-cv-3635, 2009 WL 1564144, at *1 n.l (S.D.N.Y. Jun. 4, 2009))); Tomasino v. Estee Lauder
Cos., Inc., 13-CV-4692, 2015 WL 1470177, at *6 (E.D.N.Y. Mar. 31, 2015) (“The complaint is
not admissible into evidence. Once the standard prescribed by Twombly and Iqbal has been
satisfied, the function of the complaint is merely to provide notice.”); Versace v. Versace, No.
01CIV.9645(PKL)(THK), 2003 WL 22023946, at *1 n.2 (S.D.N.Y. Aug. 27, 2003) (“While a
verified complaint may be treated as an affidavit for summary judgment purposes if it meets the
requirements of Rule 56(e), an unverified complaint is not useful to the Court on such a motion.”
(citing, inter alia, Monahan v. New York City Dep’t of Corr., 214 F.3d 275, 292 (2d Cir. 2000);
Colon v. Coughlin, 58 F.3d 865, 872 (2d Cir. 1995) (further internal citations omitted))). In
addition, despite the Court’s request that the parties cite to the evidence as it is labeled in their
submissions, they instead often cited to the documents as they were labeled in discovery or
during depositions. In short, the Court often had to search the record to discern the evidence to
which the parties were referring. That being said, the Court turns to the evidence.
On October 8, 2009, NASDI submitted a bid to the City to complete the foundation, site
utilities, and miscellaneous site work for the Project. On March 5, 2010, NASDI and the City
executed the Prime Contract for NASDI’s work on Ocean Breeze.

Pursuant to the Prime

Contract, the City had to pay NASDI based on unit prices for materials supplied and installed on

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the Project. NASDI’s bid estimate for the total price was $17,629,421.37, and was the sum of
the estimates for the various line items.
1. The Harrison Lease
On October 26, 2009, NASDI and Harrison entered into a lease agreement (the “Lease”)
in which Harrison agreed to lease a commercial space at 1600 Harrison Avenue, Bay Shore, New
York to NASDI. Troy Caruso (“Caruso”), the President of Harrison, Superior, and Diversified,
signed the Lease on Harrison’s behalf.
Paragraph 3 of the Lease originally stated that “[t]he term of the Lease shall be Monthly
commencing November 1, 2009.” (Def.’s Ex. D at 001205). However, the word “Monthly” was
crossed out. Above the crossed out word, the term “5 yrs” was written, and Caruso apparently
initialed the change and dated it February 1, 2010. No one representing NASDI initialed the
change. (Battistoni Aff. ¶ 11). The rent was three thousand dollars a month.
As to the change in the lease terms, Caruso testified:
Q: What was the purpose [of making the change to a five year lease term]?
A. Because I think the lease was originally by the month . . . when NASDI was
first renting, and then when we landed this job, then it became more of a
permanent thing. . . . [It was five years] [b]ecause we were doing some projects
together. I don’t know. That’s what they wanted. . . .
Q: So then Mike Wewiora is the one whose idea it was to make this a five-year
term?
A: No. It was my idea, and Mike’s, yeah. They didn’t want to move all their
stuff there and get thrown out in a month’s notice. Yeah, it was a mutually agreed
thing.
Q: If there’s someone from NASDI who agreed to the five year term, it would be
Mike Wewiora?
A: Yes.
...
Q: And did anyone from NASDI sign off on the change from monthly to five
years?
A: It looks like George Lemelman [then President of NASDI] signed his name on
the – printed his name on the bottom, but I can’t tell. This is years ago.
...
Q: Did you send a copy of the amended lease to NASDI to execute?
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A: I’m sure we must have, yeah.
Q: Did NASDI ever send back a copy of the lease to Superior showing they had
signed off on the change from monthly to five years?
A: I’m assuming that this bottom signature is that.
Q: But did anyone from NASDI initial the change on page one?
A: I don’t see an initial. . . . I don’t see anything on page one.
(Def.’s Ex. C at 289–92).
Pursuant to the terms of the Lease, NASDI paid $2,000 to Harrison each month until
February 2012, when NASDI notified Harrison that it was terminating the Lease by letter. (See
Def.’s Ex. E). NASDI quit the leased premises at the end of February 2012.
2. The Sub-Buyout Agreement
NASDI entered into subcontracts with various subcontractors to complete certain aspects
of NASDI’s work on the Project.

Caruso testified that Superior helped NASDI obtain

subcontractor bids.
Between February and April of 2010, NASDI executives discussed with Caruso the
possibility of having Superior secure subcontractors to complete work that NASDI had agreed to
do, and splitting any savings realized by NASDI from the hiring of the subcontractors. NASDI’s
savings would have been the difference between the line item in NASDI’s bid and the
subcontractor’s price for that same work.
The Plaintiffs claim that the Sub-Buyout Agreement was confirmed in writing through:
an email from Tim Higgins (“Higgins”), who was the President of NASDI at the time, to Caruso
on February 17, 2010 memorializing a discussion they purportedly had the week earlier
regarding the sub-buyout agreement; an email from Higgins to Caruso on March 2, 2010 again
discussing the agreement; an unsigned Memorandum of Understanding dated March 21, 2010
which was written on Superior letterhead detailing the purported agreement; an October 27, 2011
letter from Caruso to NASDI stating that there had been a change in the original agreement
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between NASDI and Superior in the form of the profit sharing realized from subcontractor
buyouts; a March 8, 2012 email from Caruso to Martin Battistoni of NASDI stating that the
contract needed to be changed to reflect, inter alia, the 50% profit sharing of subcontractor
buyouts; and a two-page spreadsheet apparently compiled by Robert D’Arpa, Superior’s Project
Manager, which details NASDI’s savings that resulted from subcontractor buyouts.
In the February 17, 2010, email from Higgins to Caruso, Higgins said that “[t]his email is
to memorialize the agreements we made last week during our dinner discussions.” (Def.’s Ex. F
at 001197). Higgins then proceeded to outline five points central to the agreement. Relevant
here, Higgins said that:
The project was bid based upon performing $12,000,000.00 of the project with in
house crews. NASDI is guaranteed a profit margin of 7.5% on this dollar amount
and if the profit margin is higher than anticipated, NASDI and Diversified will
split the monies evenly. The remaining $5,000,000.00+ is work that is to be
subcontracted and at the time of the bid there was a markup of 3% on this
subcontracted work. NASDI and Diversified will split the markup and split any
additional cost savings recognized during the buyout of the subcontractors. . . . If
a subcontractor is found to perform work originally anticipated to be performed in
house, the cost savings will be split evenly between NASDI and Diversified.
(Id.).
The memorandum of understanding was prepared by Paul Huffer (“Huffer”), who
worked for both Superior and NASDI from May 2010 through November 2010. He worked for
NASDI from November 2010 through November of 2011, and for Superior for two and a half
years before that. Huffer testified that he prepared the memorandum of understanding “on behalf
of Superior to NASDI to try and get this agreement finally written and in place. This was after
some back and forth negotiations between them.” (Def.’s Ex. H at 20). Relevant here, while the
emails from Caruso said that the agreement was between NASDI and Diversified, the
memorandum of understanding said that the agreement was between NASDI and Superior.

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Caruso testified that a formal contract exists signed by both parties that fully
memorialized the Sub-Buyout Agreement, but that only NASDI possesses the contract, and has
refused to give it to him. (Def.’s Ex. C at 54–56).
3. NASDI’s Subcontract with Superior
On or about December 16, 2010, Superior entered into a subcontract with NASDI, in
which Superior agreed to install structural concrete for the Project’s foundation (the “Superior
Subcontract”).

Caruso signed the Superior Subcontract on Superior’s behalf, and George

Lemelman (“Lemelman”), who was president of NASDI at the time, signed on its behalf.
Caruso and Lemelman initialed each page of the subcontract except for the signature page, which
was only initialed by Caruso.
The Superior Subcontract provided, in relevant part:
1.1 The Subcontractor agrees to furnish all labor, equipment, materials, supplies,
tools and supervision to diligently and expeditiously perform all the work as
described in the Schedule (hereinafter referred to as the "Work") required for
Installation of Structural Concrete for Foundation (hereinafter referred to as the
''Project'') located in Staten Island, NY for New York City Department of Parks
and Recreation, (hereinafter referred to as· the "Owner"), in accordance with all
of the plans, drawings, specifications, general conditions, special conditions, and
pre-contract addenda of the Prime contract and this Subcontract.
...
1.5 Subcontractor, by signing this Agreement, acknowledges that it has full
knowledge of the provisions of the Prime Contract, and confirms and agrees that
the entire aforesaid Prime Contract including but not limited to all of the plans,
drawings, specifications, general conditions, special conditions and pre-contract
addenda, which are part of the Prime contract between the Owner and NASDI,
shall be considered and are hereby made a part of this Subcontract by this
reference thereto, and the Subcontractor represents that he is familiar with all the
terms, conditions, covenants, and provisions thereof. Subcontractor agrees to be
bound to NASDI by all of the terms of the Prime Contract and to assume toward
NASDI all of the obligations and the responsibilities that NASDI by those
instruments assumes toward Owner. Subcontractor further agrees that NASDI
shall have the same rights and remedies against Subcontractor that Owner has
against NASDI under the Prime Contract as though the terms of those instruments
were set forth in full in this Subcontract.
...
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3.1 The Subcontractor shall schedule his operations and proceed with the Work,
and shall complete the Work or portions. thereof, on or before such final
completion and any interim or milestone completion dates for any phase, portion
or sequence of the Work as set by either NASDI or the Owner. The Subcontractor
agrees to coordinate his Work with any other work to be done on the project by
NASDI, the Owner, and any contractors or subcontractors whose work may
overlap or conflict with the scope of the Work under this Subcontract.
...
5.9 Final Payment shall be the unpaid balance of the Subcontract Amount, and
shall become due when the Work described in this Subcontract is fully completed
and performed in accordance with this Subcontract and the Prime Contract, and is
satisfactory to and approved by Owner, Architect and NASDI. Payment of
retention, reserved amounts and final payments shall be made to the
Subcontractor only upon NASDI's receipt of the corresponding payment from the
Owner.
5.10 In addition to any other requirements at this Subcontract and the Prime
Contract, Final Payment shall not become due unless and until the following
conditions precedent to Final Payment have been satisfied (a) approval and
acceptance of Subcontractors Work by Owner, Architect/Engineer and NASDI,
(b) delivery to NASDI of all manuals, "as-built" drawings, guarantees, and
warranties for material and equipment furnished by Subcontractor, and any other
documents required by the Prime Contract, c) receipt of Final Payment for
Subcontractors Work by NASDI from Owner, (d) furnishing to NASDI of
satisfactory evidence by Subcontractor that all labor, applicable taxes, fees and
fringe benefits, and material accounts incurred by Subcontractor in connection
with the Work have been paid in full, (e) furnishing to NASDI a completed
Affidavit Release of Lien and Waiver of Claim by Subcontractor and any Subsubcontractors in a form satisfactory to NASDI (f) an agreement holding NASDI
and the Owner free and harmless from any and all claims arising out of or in
connection with this Subcontract and in compliance with any other requirement of
the Prime Contract.
...
6.2 No alterations, increases or decreases shall be made in the Work as shown or
described by the Prime Contract except on the prior written order of NASDI, and
when so made, the value of the Work or materials added or omitted shall be
computed and determined by Subcontractor, subject to the written approval and
acceptance by NASDI, and the amount so determined shall be added to or
deducted from the Subcontract Amount. Subcontractor shall have no claim for
additional work or changed work unless such work has been done in pursuance of
a written order from NASDI. Any extra work performed without such written
order will be at Subcontractor's cost and expense.
6.3 For changes in the Prime Contract that have been initiated by Owner, for acts
or omissions of the Owner and for defects in the Prime Contract, Subcontractor
shall submit any claims it may have, including notice thereof, for adjustment in
the price, schedule or other provisions of the Subcontract to NASDI in writing in
sufficient time and form to allow NASDI to process such claims within the time
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and in the manner provided for and in accordance with the applicable provisions
of the Prime Contract. Subcontractor agrees that it will accept such adjustment, if
any received by NASDI from Owner as full satisfaction and discharge of such
claim. Payment for this extra work shall not be made to the Subcontractor until
issuance of a written change order and payment to NASDI by the Owner.
6.4 For changes directed by NASDI, which NASDI agrees that the extra work is
compensated Subcontractor shall be entitled to an adjustment in the Subcontract
price, provided Subcontractor gives NASDI written notice within five (5) days
and shall submit the actual Change Order Request within ten (10) days after
receipt of the proposed instruction, and prior to performing such changed Work.
Failure to provide such notice shall be deemed to prejudice NASDI's rights and to
constitute a waiver of such claims by Subcontractor.
...
6.6 If Subcontractor believes the occurrence of some act or event, other than
changes ordered by NASDI, justifies a change in the Subcontract Amount or the
time for performance of the Work, Subcontractor shall notify NASDI in writing
within three (3) days of the occurrence of such act or event and the scope of the
change to allow NASDI to forward the notice to Owner. Failure to provide such
notice shall be deemed to prejudice NASDI's rights and to constitute a waiver of
such claims by Subcontractor.
6.7 The Change Order Request shall consist of the detailed cost estimate
outlining the changes in the work and detailed documentation justifying proposed
changes in time. This estimate shall be computed in accordance with accepted
estimating procedures and in accordance with the terms of the Prime Contract,
and the costs for labor and materials shall be at prevailing rates in the Project area.
Subcontractor shall be allowed the percentage markup for Subcontractors
overhead and profit specified in the schedule unless a lesser percentage is allowed
to NASDI's subcontractors in the Agreement between Owner and NASDI.
...
10.2 Subject to Subcontractor’s giving notice and other information, NASDI
shall take all reasonable steps to secure from the Owner, such contractual benefits
that may be claimable on behalf of the Subcontractor. The Subcontractor shall in
sufficient time afford NASDI all information and assistance that may be required
to enable NASDI to claim such Contractual benefits. On receiving such
Contractual benefits from the Owner, NASDI shall pass on to the Subcontractor
such proportion thereof, it being understood that in the case of any claim of the
Subcontractor for any additional payment, NASDI’s receipt of payment from the
Owner shall be a condition precedent to NASDI’s liability to the Subcontractor in
respect of such claim.
10.5 NASDI shall represent the Subcontractor in its claims only to the extent of
passing the claim on to the Owner and shall not be required to actively support
such claims and the Subcontractor shall retain responsibility for the proofs and
processing of the claims. The Subcontractor shall reimburse NASDI all costs
incurred including attorneys' fees, in passing such claim on to Owner; the
Subcontractor shall not advance any frivolous or unsupported claims. NASDI is

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liable to Subcontractor with respect to claims only to the extent that the Owner is
determined, by litigation or settlement, to be liable to NASDI.
...
12.2 Any decision or determination by Owner or Architect relating to NASDI's
performance or compensation under the Agreement between NASDI and Owner
that is binding upon NASDI shall also be binding upon Subcontractor insofar as it
relates to or involves Subcontractor's performance under, or the terms of this
Subcontract. Any decision or determination resulting from arbitration or litigation
between NASDI and Owner which relates to Subcontractors performance under,
or the terms of, this Subcontract shall be binding upon Subcontractor, provided
that Subcontractor has been given reasonable notice of and the opportunity to
participate and present evidence in the arbitration or litigation. Insofar as a
decision of Owner or Architect relating to Subcontractor's performance of the
Work under the terms of this Subcontract is a condition precedent to NASDI's
right to proceed to arbitration or litigation under the Prime Contract, such decision
is also a condition precedent to Subcontractor's right to proceed to arbitration
under this Subcontract.
...
23.1 It is understood and agreed that the Work provided for in this Subcontract
constitutes only a part of the work being performed for Owner by NASDI and
other Subcontractors. Subcontractor, therefore, agrees to perform the Work in
such a manner that it will not injure, damage or delay any other Work performed
by NASDI or any other subcontractor or supplier, and further agrees to pay or
reimburse NASDI for any additional costs, damage or delay that may be caused to
such other work of NASDI subcontractors or its agents or employees.
24.6 This instrument and the documents specially incorporated herein by
reference represent the entire agreement between NASDI and the Subcontractor
and may not be amended without their written consent. All negotiations and
agreements prior to the date of this Subcontract not included herein are hereby
voided. In the event NASDI and Subcontractor enter into another subcontract on
another project, wherever located, a default under said subcontract shall be a
default hereunder and vice versa.
(Def.’s Ex. I).
In a “schedule” addendum, the Superior Subcontract also states “Subcontractor’s
percentage markup for overheads and profit (Clause 6.7) In accordance with Prime Contract
General Conditions Section C Article Extra Work Performed as Outlined in Chapter VI Article
25, 26, 27 and 28 Of the Agreement.” (Id. at 13913).
There are additional handwritten clauses that append paragraphs 3.3 and 23.1 of the
Superior Subcontract.
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Under 3.3, it states that “Superior Sitework is to be compensated for any acceleration in
schedule due to any delays by others. Superior is to be compensated weekly as per contract
documents. This can be done on a T+M basis or lump sum change order.” The handwritten
change is only initialed by Caruso. Battistioni stated that “NASDI never assented in writing to
his unilateral, hand-written change.” (Battistioni Aff. ¶ 49).
The handwritten clause after 23.1 states, “[a]s per our original agreement, a second
contract will follow which splits the subcontractor buyouts 50/50, NASDI + Superior Site. This
is approx. $1,500,000 at this point.” (Id.). Caruso wrote his initials next to this addendum. No
one from NASDI appears to have initialed this statement. NASDI claims that this statement was
crossed out. While the Plaintiffs did not dispute this point in their 56.1 Statement, it appears just
as likely that Caruso attempted to write this statement on three lines, but was unable to keep his
handwriting on the line.

Thus, the beginning of each line appears above the handmade line,

while the second half of each line appears crossed out. It appears as follows:
As per our original agreement, a second contract
will follow which splits the subcontractor buyouts 50/50, NASDI + Superior Site.
This is approx.. $1,500,000 at this point. TC
(Id.). Battistioni stated that it was crossed out. (Battistioni Aff. ¶ 21).
4. NASDI’s Change Orders
During the course of the Project, NASDI submitted eight written change orders to
Superior: change order no. 1 for ($1,042,650.77) dated April 4, 2012; change order no. 2 for
$724,929.75 dated April 4, 2012; change order no. 3 for $1,247,111.91 dated April 4, 2012;
change order no. 4 for $95,271.83 dated April 14, 2012; change order no. 5Rev for
($520,888.36) dated July 6, 2012; change order no. 6 for $82,104.48 dated October 5, 2012;

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change order no. 7 for $167,578.23 dated October 5, 2012; and change order no. 9 for
$18,500.00 dated March 26, 2013.
5. Superior’s Releases
Superior signed two releases—one on May 2, 2012 (the May 2012 Release”), and another
on October 16, 2012 (“the October 2012 Release”). The October 2012 Release provides, in
relevant part:
I. Certifications, Affirmations and Warranties
The undersigned, to support its entitlement to the requested payment, and for and
in consideration of payment made by NASDI, LLC ("Contractor") to the
undersigned or to a subcontractor, materialman, or supplier of the undersigned,
and contingent upon the receipt of such payment, for work performed in the
construction of the above-referenced Project pursuant to the above-referenced
Subcontract or Purchase Order, hereby affirms, certifies and warrants as follows:
1. Upon receipt of the sum of $_755,567.95_, as payment for Change Orders 5, 6,
and 7 on the above-referenced Subcontract, the undersigned will have received
final payment, minus retainage, under the terms of the Subcontract or Purchase
Order (and all authorized changes from [change orders] 1-7 thereto) between
Contractor and Subcontractor Superior Site Work ("Subcontractor") relating to
the Project, including (1) all labor expended in the construction of the Project, (2)
all fixtures and equipment delivered to the site and either incorporated or to be
incorporated into the Project, (3) all materials, fixtures and equipment for the
Project stored offsite to the extent authorized by Contractor and for which
payment therefor is permitted by Contractor's contract with the Owner and all
requirements of said contract with respect to materials stored offsite have been
fulfilled, (4) all services performed in the construction of the Project, and (5) all
equipment used, or provided for use, in the construction of the Project. Such work
including items (1) through (5) is hereafter collectively referred to as "work
performed in the construction of the Project."
2. Except for receipt of payment as set forth in paragraph 1, there are no
outstanding claims against Contractor and/or its sureties, the Owner of the Project
and/or its lenders and guarantors, or the Project in connection with the work
performed in the construction of the Project.
...
II. Waiver and Release
In accord with the Subcontract Agreement or the Purchase Order, as applicable,
the undersigned does hereby forever waive and release in favor of Contractor and
its sureties, the Owner of the Project and its lenders and guarantors, the Project
and the title company or companies examining and/or insuring title to the Project,
and any and all successors and assignees of the above, all rights that presently
exist or hereafter may accrue to the undersigned by reason of work performed in
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the construction of the Project through October 11, 2012, (1) to assert a lien upon
the land and/or improvements comprising the Project, and (2) to assert or bring
any causes of action, claims, suits and demands which the undersigned ever had
or now has against Contractor and/or its sureties, the Owner of the Project and/or
its lenders and guarantors, or the Project. The only claims hereunder that is
reserved by the undersigned is its claim for delay related damages under the
Subcontract ("Subcontractor's Delay Claim"), equipment rental to NASDI and
owner related extra work claims. The Subcontractor's Delay Claim and Owner
related extra work claims is specifically predicated on Subcontractor providing
sufficient proof of the cause of the complained-of delay, extra work and the
delay's adverse impact on Subcontractor's work, the Subcontractor's damages
resulting directly therefrom, and the Subcontractor's contractual entitlement to
those damages, and on the Contractor's recovery of said damages from the Owner.
(Def.’s Ex. L).
6. Superior’s Claim for Specific Charges
On October 5, 2012, representatives of Superior and NASDI executed change order no. 5.
Change order number 5 detailed 11 different changes to the Superior Subcontract.

Those

changes are listed as items 5A–5K in the change order.
Caruso testified that although Superior signed the change order on that date, “after the
actual[] [] quantities were received, there needed to be adjustments made in th[e] change order.”
(Def.’s Ex. C at 152). He further stated that “we did analysis on every one of these change
orders after discovery, and went through each item. . . . We went through each one of these
change orders, looked at every line item, compared them to the documentation that NASDI
provided us, picked out the differences and that’s how we based [] the numbers in the lawsuit.”
(Id.).
The Plaintiffs provided documents that they claim show that they disputed some the
charges in change order no. 5. (See Pl.’s Ex. 2). The Plaintiffs mostly rely on various pages that
appear to be part of an excel spreadsheet. NASDI objects that this evidence is inadmissible, as it
is not authenticated by someone with personal knowledge, and there is no evidence that the

13

documents were ever served on NASDI. See FED. R. CIV. P. 56(c)(2) (“A party may object that
the material cited to support or dispute a fact cannot be presented in a form that would be
admissible in evidence.”).
NASDI is correct on both points.

There is no evidence that these documents were

provided to NASDI at any point, and the documents are not properly authenticated by anyone
who would have knowledge of the documents.

While the Plaintiffs’ attorney submitted an

affidavit stating that the documents are “true and accurate cop[ies] of [Superior]’s rejection of
the back charges for line items 5F, 5G, 5I, and 5J,” (Decl. of Saul Zabell i[n] Opp. to Def.’s Mot.
for Summ. J. (ECF No. 125-1) (“Decl. of Zabell”) ¶ 5), the Plaintiffs’ attorney does not have
personal knowledge of these matters. See FED. R. CIV. P. 56(c)(4) (“An affidavit or declaration
used to support or oppose a motion must be made on personal knowledge, set out facts that
would be admissible in evidence, and show that the affiant or declarant is competent to testify on
the matters stated.”); see also Wyler v. United States, 725 F.2d 156, 160 (2d Cir. 1983) (“An
affidavit of the opposing party’s attorney which . . . is not based on first-hand knowledge is not
entitled to any weight.” (internal citations omitted)).

Therefore, the Court does not consider

these documents.
7. Superior’s Claim for Extra Work, Change Orders, and Profit Sharing
Superior claims that it had to perform extra work at NASDI’s request, and was never paid
for it. Specifically, Superior states that it is owed $22,050.60 for open time and material change
orders; $150,000 for pile cap and grade beam reports; $153,870.09 for open concrete PSI
upgrade change orders; and $175,817.26 for grade beam through pile cap.

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i. Open Time and Material Change Orders
On December 31, 2011, Superior Site Work sent NASDI change order numbers twentytwo (22) and twenty-three (23).

Change order 22 was for “the additional rebar drawings

requested for pile cap & grade beam Drawing . . . dated March 29, 2011 as directed by NASDI,”
(Pls.’ Ex. 3 at 000444), and totaled $7,078.50. Change order 23 was for “the Increased Design
of the Canopy Footing,” (id. at 000451), and totaled $14,972.10. Caruso testified that the claim
for change orders 23 and 23 arose “[a]round February 2011, (Def.’s Ex. C at 186), that NASDI
told him they would pay it, and that it resulted from a mistake by a prior subcontractor.
Specifically, the prior subcontractor apparently put the piles in the wrong place.
ii. Pile Cap and Grade Beam Reports
On February 10, 2012, Superior sent change order number thirty-four (34) for
“Additional Increase to the Pile Caps and Grade Beams due to Re-Design of Big Upon blue
Prints dated- 4/1/2009 and Revised Blue Prints-Revision #3-Dated-10/27/11 & 11/22/2011 as
directed by NASDI,” (Pls.’ Ex. 4 at 000240), and totaled $154,681.04. Caruso testified that the
claim first arose on October 17, 2011. (Def.’s Ex. C at 193). He said that “[t]here was a
redesign on the job and NASDI issued us a set of blueprints, revision number three. . . . It was
additional concrete added and additional rebar. . . . [They were needed because] [t]here was
some sort of issue with Case Foundations between Case Foundations and NASDI.”
Superior received the revised blueprints on October 17, 2011.

(Id.).

The original amount of

$154,681.04 was negotiated with the City down to $150,000.
iii. Open Concrete PSI Upgrade Change Orders
On April 30, 2012, Superior sent change orders number sixty-seven (67) through seventyfour (74). Change order 67 was for “Work Completed on the UPGRADE OF CONCRETE

15

MATERIAL FROM BID SPEC OF 4,000 PSI to 5,500 PSI Item as directed by [the City]” (Pls.’
Ex. 5 at 000755), covered the period from October 20, 2011 to February 3, 2012, and totaled
$10,382.24. Change order 68 was for similar work as change order 67, covered the period from
October 20, 2011 to February 6, 2012, and totaled $10,973.10. Change order 69 covered similar
work as change order 68, was for the period between October 20, 2011, to April 6, 2012, and
totaled $7,623.22.

Change order 70 was for similar work, and covered the same period as

change order 69, and totaled $2,076.52. Change order 71 was for similar work, covered a period
of March 1, 2012 to March 31, 2012, and totaled $15,436.17. Change order 72 was for similar
work, covered the period of March 1, 2012 to June 30, 2012, and totaled $27,785.72. Change
order 73 was for the same work, covered April 24, 2012 to June 30, 2012, and totaled
$20,346.68. Change order 74 was for the same work, for the period of March 1, 2012 to June 30,
2012, and totaled $2,258.28.
Caruso testified that Michael Wewiora from NASDI directed the increase in PSI. (Def.’s
Ex. C at 205; see also id. at 204 (NASDI made a request for us to increase the PSI of the
concrete.”))
iv. Grade Beam Through Pile Cap
On February 10, 2012, Superior sent change order number forty-one (41) for “Additional
Increase to the Grade Beams due to the Grade Beam Running through the Pile Caps to the actual
Pile as directed by NASDI,” and totaled $175,817.26. The change order does not detail when the
work was done, but Caruso testified that the claim arose in February 2011 as a result of the same
design change that lead to change order 34.

Caruso further testified that NASDI was notified

through “shop drawings, meetings of minutes, . . . negotiations with New York City DDC,
Department of Parks and Recreations[;] [t]here’s constant communications, blueprints back and

16

forth, emails, job site meetings, minutes, weekly.

There’s copies of blueprints that are all

marked up that Superior provided NASDI to get paid from the city.” (Def.’s Ex. C at 200). The
Court notes that the Plaintiffs did not provide the documents listed by Caruso.
v. Rebar Parking Lot and Rebar Slab on Grade
Caruso also testified that Superior and NASDI allegedly entered into an agreement
wherein Superior would negotiate certain change orders with the City, and NASDI and Superior
would split the profits from the savings accrued from subcontracting that work. Specifically,
Caruso said that the City changed the parking lot specifications from asphalt to concrete with
rebar. Caruso testified that this agreement was in writing, but no agreement was provided to the
Court. He claimed that Superior was owed $74,359.94. Caruso also testified that the City made
a change in the design of the top of the foundation which called for additional rebar. Caruso said
that he had provided a change order to NASDI related to the additional rebar for the “slab on
grade,” but the Plaintiffs did not supply any evidence of a change order. According to Caruso,
Superior is owed $176,372 for the additional rebar slab on grade. Caruso was unable to say
when the claim arose. It is unclear from Caruso’s testimony why Superior is owed this money.
The Plaintiffs, in their memorandum of law, argue that Superior is owed the money pursuant to
the alleged profit sharing agreement, but Caruso did not testify to that effect.
8. Superior’s Delay Claim
Although Superior mobilized to the Project on January 2011, they were not able to do
much at that time because “the owner didn’t accept the overcast piles,” and NASDI instructed
Superior to demobilize. (Def.’s Ex. C at 232). Superior knew on “day one,” (id. at 223), even
before Superior signed the subcontract, (id. at 224), that the progress was delayed because a
previous subcontractor had incorrectly installed the piles.

17

Superior demobilized on March 14,

2011, and apparently received the order to demobilize from NASDI at some point between
January and March 2011. NASDI ordered Superior to remobilize on October 18, 2011. During
those ten months, Superior was not able to do “much” work on the Project. (Id. at 233). When
Superior remobilized, it had to work during the winter months.
Caruso testified that in March of 2011, he knew that Superior would have to expend more
money on the Project because of “[r]educed labor production, increased insurances, winter
conditions, winter concrete, blankets on concrete, all of the above construction costs in the
winter.” (Id. at 234). However, in March of 2011, he did not know how long the delay would
last.
On September 16, 2011, Superior submitted a written notice of its delay claim to NASDI
for $1,534,952.51. (Def.’s Ex. O at N014346–66).
On February 18, 2015, NASDI submitted a claim for delay damages on Superior’s behalf
to the City in the amount of $1,205,415.00.

(Id. at N013918-4366). NASDI submitted that

amount because it said that Superior’s claim for $216,552.29 for the costs of pile deviations was
accounted for under change order no. 6, and Superior’s claim for $99,003.61 for the increase in
concrete strength was an increase in the scope of Superior’s work rather than delay damages.
Change order 6 states that the change was a “redesign [of] pile caps & grade beams due to Case
Foundation of tolerance installation.” (Def.’s Ex. J).
The delay claim submitted by NASDI on Superior’s behalf is still pending.
9. Superior’s Claim for Final Payment
Caruso testified that Superior performed its obligations pursuant to the Superior
Subcontract and has not received final payment. (Def.’s Ex. C at 272). Superior contends that it
is owed $458,328.75, but it does not offer any evidence in support of that number.

18

Martin Battistoni (“Battistoni”), the former president of NASDI, stated in an affidavit that
the City has not yet certified the Project as substantially complete. (Battistoni Aff. (ECF No.
122-2) ¶ 55).
B. The Relevant Procedural History
On February 19, 2014, the Plaintiffs commenced this action by filing a complaint. The
original complaint brought causes of action for breach of contract, conversion, fraud in the
inducement, and unjust enrichment against NASDI.

The original complaint also named

Travelers Casualty and Surety Company of America (“Travelers”) as a defendant, but the
complaint did not assert any claims against Travelers.
On April 30, 2014, NASDI and Travelers made separate motions to dismiss the
complaint pursuant to Rule 12(b)(6).

In response, on May 20, 2014, the Plaintiffs filed an

amended complaint, which asserts an additional claim against Travelers as surety for NASDI.
The Court construed NASDI’s motion to dismiss as one addressing the amended complaint. (See
Mem. of Dec. and Order dated March 14, 2015 (ECF No. 37) at 9).
On March 14, 2015, the Court granted in part, and denied in part the motions to dismiss.
The Court dismissed Superior and Diversified’s breach of contract claims; the Plaintiffs’ unjust
enrichment claims pled in the alternative to Superior’s breach of contract claims; the Plaintiffs’
conversion claims; and the sole claim against Travelers. The Court denied the motions with
respect to Harrison’s breach of contract claim; and Harrison and Diversified’s unjust enrichment
claims asserted in the alternative to their breach of contract claims. The Court granted Superior
and Diversified leave to file a second amended complaint.
On April 13, 2015, the Plaintiffs filed a second amended complaint against NASDI. The
second amended complaint includes claims for breach of contract by each of the Plaintiffs; and

19

claims for unjust enrich in the alternative by Diversified and Harrison. Harrison’s breach of
contract claim is predicated on the Lease; Diversified’s claim is premised upon the Sub-Buyout
Agreement; and Superior’s claim is based on the Superior Subcontract and change orders.
On April 27, 2015, NASDI filed a motion to dismiss the second amended complaint,
which was denied in its entirety by the Court on February 9, 2016.
On March 25, 2016, NASDI filed a thirty-party complaint against the City, Case
Foundation Company (“Case”), and the New York City Department of Parks and Recreation
(collectively, the “Third-Party Defendants”).
The Plaintiffs and Third-Party Defendants subsequently filed various motions to dismiss,
sever, or hold in abeyance the third-party complaint.
On January 23, 2017, the Court granted Case’s motion to hold the third-party action in
abeyance pending the outcome of parallel cases in New York State Supreme Court. In addition,
the Court granted the New York City Department of Parks and Recreation’s motion to dismiss
all claims against it.
On November 10, 2017, NASDI filed the instant motion for summary judgment pursuant
to Rule 56 seeking dismissal of the second amended complaint.
II. DISCUSSION
A. The Legal Standard
Pursuant to Rule 56, “[t]he court shall grant summary judgment if the movant shows that
there is no genuine dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” FED. R. CIV. P. 56(a). When deciding a motion for summary judgment, “[t]he
Court ‘must draw all reasonable inferences and resolve all ambiguities in favor of the non–

20

moving party.’” Castle Rock Entm’t, Inc. v. Carol Publ’g Grp., Inc., 150 F.3d 132, 137 (2d Cir.
1998) (quoting Garza v. Marine Transp. Lines, Inc., 861 F.2d 23, 26 (2d Cir. 1998)).
“[A]t the summary judgment stage the judge’s function is not [] to weigh the evidence
and determine the truth of the matter but to determine whether there is a genuine issue for trial.”
Redd v. N.Y. State Div. of Parole, 678 F.3d 166, 173–74 (2d Cir. 2012) (quoting Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S. Ct. 2505, 2511, 91 L. Ed. 2d 202 (1986) (internal
quotation marks omitted)).

In other words, “[c]redibility determinations, the weighing of the

evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of
a judge.” Barrows v. Seneca Foods Corp., 512 F. App’x 115, 117 (2d Cir. 2013) (summary
order) (quoting Redd, 678 F.3d at 174 (internal quotation marks omitted)). The Court should not
attempt to resolve issues of fact, but rather “assess whether there are any factual issues to be
tried.” Cuff ex rel. B.C. v. Valley Cent. Sch. Dist., 677 F.3d 109, 119 (2d Cir. 2012).
The movant has the burden of demonstrating the absence of genuine issues of material
fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2552, 91 L. Ed. 2d 265
(1986). If a nonmoving party fails to make a sufficient showing on an essential element of their
case where they will have the burden of proof, then summary judgment is appropriate. Id. at
323.

If the nonmoving party submits evidence which is “merely colorable,” legally sufficient

opposition to the motion for summary judgment is not met. Liberty Lobby, 477 U.S. at 249. The
mere existence of a scintilla of evidence in support of the nonmoving party’s position is
insufficient; there must be evidence on which the jury could reasonably find for that party. See
Dawson v. Cty. of Westchester, 373 F.3d 265, 272 (2d Cir. 2004).
In contract cases, “summary judgment may be granted . . . only when the contractual
language on which the moving party's case rests is found to be wholly unambiguous and to

21

convey a definite meaning.” Topps Co., Inc. v. Cadbury Stani S.A.I.C., 526 F.3d 63, 68 (2d
Cir. 2008). An agreement is ambiguous where “a reasonably intelligent person viewing the
contract objectively could interpret the language in more than one way.” Id. “To the extent the
moving party's case hinges on ambiguous contract language, summary judgment may be granted
only if the ambiguities may be resolved through extrinsic evidence that is itself capable of only
one interpretation, or where there is no extrinsic evidence that would support a resolution of
these ambiguities in favor of the nonmoving party's case.” Id. “[T]he mere assertion by a party
that contract language means something other than what it clearly says is not sufficient to raise a
triable issue of fact.” 239 East 79th Owners Corp. v. Lamb 79 & 2 Corp., 30 A.D.3d 167, 168,
818 N.Y.S.2d 194, 195 (1st Dep’t 2006).
B. The Relevant Law
As stated above, the Plaintiffs brought causes of action for breach of contract, and
Harrison and Diversified brought unjust enrichment claims in the alternative.
A. Breach of Contract
In New York, the elements of a breach of contract claim are “(i) the formation of a
contract between the parties; (ii) performance by the plaintiff; (iii) failure of the defendant to
perform; and (iv) damages.” Johnson v. Nextel Comm’ns. Inc., 660 F.3d 131, 142 (2d Cir. 2011)
(citing Eternity Global Master Fund Ltd. v. Morgan Guar. Trust Co. of N.Y., 375 F.3d 168, 177
(2d Cir. 2004)).
B. Unjust Enrichment
Under New York law, the elements of unjust enrichment are: “(1) defendant was
enriched, (2) at plaintiff’s expense, and (3) equity and good conscience militate against
permitting defendant to retain what plaintiff is seeking to recover.” Legurnic v. Ciccone, No. 09-

22

CV-1436 ADS AKT, 2014 WL 6674593, at *7 (E.D.N.Y. Nov. 25, 2014) (quoting Briarpatch
Ltd., L.P. v. Phoenix Pictures, Inc., 373 F.3d 296, 306 (2d Cir. 2004)).
Under New York law, “[t]he existence of a valid and enforceable written contract
governing a particular subject matter ordinarily precludes recovery in quasi contract for events
arising out of the same subject matter.” Clark–Fitzpatrick, Inc. v. Long Island R.R. Co., 70
N.Y.2d 382, 521 N.Y.S.2d 653, 516 N.E.2d 190, 193 (N.Y. 1987); see also Mid-Hudson Catskill
Rural Migrant Ministry, Inc. v. Fine Host Corp., 418 F.3d 168, 175 (2d Cir. 2005) (“New York
law does not permit recovery in quantum meruit, however, if the parties have a valid, enforceable
contract that governs the same subject matter as the quantum meruit claim.”).
C. Application to the Plaintiffs’ Claims
1. As to Harrison’s Breach of Contract Claim
Harrison argues that NASDI breached the Lease when it terminated it prior to the
expiration of the purported five-year term. NASDI argues that Harrison has not proffered any
evidence that NASDI accepted the material change, or that there was consideration given in
exchange for the modification. The Court agrees with NASDI on both points.
The evidence is clear that on October 26, 2009, agents of Harrison and NASDI signed the
Lease, which was a month-to-month lease. Harrison claims that the Lease was modified on
February 1, 2010 to a five-year term.
Under New York law,
An agreement, promise or undertaking to change or modify, . . . in whole or in
part, any contract, obligation, or lease, or any mortgage or other security interest
in personal or real property, shall not be invalid because of the absence of
consideration, provided that the agreement, promise or undertaking changing,
modifying, or discharging such contract, obligation, lease, mortgage or security
interest, shall be in writing and signed by the party against whom it is sought to
enforce the change, modification or discharge, or by his agent.

23

N.Y. GEN. OBLIG. LAW § 5-1103.
Here, while Caruso initialed the change on the first page and initialed it again on the
second page under the date “2/1/10” and the term “am[]ended”, no one from NASDI initialed or
signed the change on the first page of the Lease or the note that the contract was amended on the
second page. Caruso testified that no one from NASDI initialed the change on the first page.
While Harrison attempts to rely on Caruso’s testimony wherein he said that it looked like
Lemelman printed his name on the bottom, he said that he could not tell. He further said that he
“assum[ed] that the bottom signature” from Lemelman related to the modification. However,
conjecture and assumptions are insufficient to create a triable issue of fact. Cifarelli v. Vill. of
Babylon, 93 F.3d 47, 51 (2d Cir. 1996) (stating that “mere conclusory allegations, speculation or
conjecture” will not suffice to defeat summary judgment); see also D’Amico v. City of New York,
132 F.3d 145, 149 (2d Cir. 1998) (“The non-moving party may not rely on mere conclusory
allegations nor speculation, but instead must offer some hard evidence showing that its version
of the events is not wholly fanciful.” (emphasis added)).
Harrison has not offered any evidence that NASDI signed a modification after October
26, 2009.

NASDI’s sole signature on the Lease is from October 26, 2009, and there is no

indication that they agreed to the modification.
To the extent that Harrison relies on an oral modification, it has failed to show that
consideration was given to NASDI for the modification.

“To be enforceable, an oral

modification must possess all of the elements necessary to form a contract, including valid
consideration.”

Cohan v. Movtady, 751 F. Supp. 2d 436, 442, 2010 WL 4608751, at *5

(E.D.N.Y. Nov. 1, 2010) (citing cases). An agreement to do something which the promisor is
already required to do by an existing contract is unsupported by consideration.

24

See Indus.

Window Corp. v. Fed. Ins. Co., 609 F. Supp. 2d 329, 340 (S.D.N.Y. 2009) (“[E]ven
assuming . . . that the alleged oral modifications were otherwise valid, there is no indication that
such modifications . . . were supported by adequate consideration.” (internal citations omitted)).
As Harrison did not provide NASDI any additional consideration for the modification, any oral
modification would not have been enforceable.
Therefore, Harrison has not provided any evidence that NASDI agreed to the
modification of the Lease to a five-year term.

Accordingly, NASDI’s motion for summary

judgment on Harrison’s breach of contract claim is granted.
2. As to Harrison’s Unjust Enrichment Claim
NASDI contends that Harrison’s unjust enrichment claim must be dismissed because the
written Lease governs Harrison’s claims.

Harrison did not respond, in any way, to this

argument. Therefore, Harrison’s unjust enrichment claim is deemed abandoned. See Robinson
v. Fischer, No. 09 CIV. 8882 LAKAJP, 2010 WL 5376204, at *10 (S.D.N.Y. Dec. 29, 2010)
(“Federal courts have the discretion to deem a claim abandoned when a defendant moves to
dismiss that claim and the plaintiff fails to address in their opposition papers defendants’
arguments for dismissing such a claim.” (citing Lipton v. Cty. of Orange, 315 F. Supp. 2d 434,
446 (S.D.N.Y. 2004) (“This Court may, and generally will, deem a claim abandoned when a
plaintiff fails to respond to a defendant's arguments that the claim should be dismissed.”)) (citing
cases); see also Bonilla v. Smithfield Assoc. LLC, 09 Civ. 1549, 2009 WL 4457304 at *4
(S.D.N.Y. Dec. 4, 2009) (dismissing certain claims where the plaintiff failed to respond to the
defendant’s arguments); Thomas v. Atl. Express Corp., 07 Civ.1978, 2009 WL 856993 at *2
(S.D.N.Y. Mar. 31, 2009) (same) (citing Hanig v. Yorktown Cent. Sch. Dist., 384 F. Supp. 2d
710, 722–23 (S.D.N.Y. 2005)); Burchette v. Abercrombie & Fitch Stores, Inc., 08 Civ. 8786,

25

2009 WL 856682 at *9 (S.D.N.Y. Mar. 30, 2009) (dismissing plaintiff’s constructive discharge
claim because plaintiff abandoned it by failing to address it in her opposition motion to
defendant's motion to dismiss all claims); Hanig, 384 F. Supp. 2d at 723 (“[B]ecause plaintiff did
not address defendant’s motion to dismiss with regard to this claim, it is deemed abandoned and
is hereby dismissed.”); Martinez v. Sanders, 02 Civ. 5624, 2004 WL 1234041 at *3 (S.D.N.Y.
June 3, 2004) (“Because Plaintiff did not address Defendant's motion to dismiss with regard to
these claims, they are deemed abandoned.”); Anti–Monopoly, Inc. v. Hasbro, Inc., 958 F. Supp.
895, 907 n. 11 (S.D.N.Y.) (“[T]he failure to provide argument on a point at issue constitutes
abandonment of the issue . . . which provides an independent basis for dismissal.”), aff’d, 130
F.3d 1101 (2d Cir. 1997).
Accordingly, NASDI’s motion for summary judgment dismissing Harrison’s unjust
enrichment claim is granted.
3. As to Diversified’s Breach of Contract Claim
NASDI argues that Diversified’s breach of contract claim must be dismissed because it
was an oral agreement that is barred by the Statute of Frauds; the writings which Diversified
claims constitute the Sub-Buyout Agreement were never signed by NASDI and had uncertain
terms; and the merger clause in the Superior Subcontract renders any previous agreement invalid.
In opposition, Diversified contends that the parties entered into a written contract; and that the
merger clause in the Superior Subcontract does not control NASDI’s agreement with Diversified.
Notably, Diversified does not contend that the parties had an oral agreement, or that there was a
preliminary agreement; instead, it solely argues that the parties entered into a binding written
agreement. The Court finds that the documents offered by Diversified show that there was not a
meeting of the minds regarding the subcontractor buyouts.

26

An exchange of emails may constitute a binding contract under New York law.
Rubinstein v. Clark & Green, Inc., 395 F. App’x 786, 788 (2d Cir. 2010) (summary order).
Additionally, “a written contract may be formed from more than one writing. Relevant writings
creating a contract may consist of letters bearing the signature of only one party or even
memoranda unsigned by either party.” Consarc Corp. v. Marine Midland Bank, N.A., 996 F.2d
568, 572–73 (2d Cir. 1993) (internal citations omitted).

“[I]f the parties have settled on the

contract’s substantial terms, a binding contract will have been created . . . .”

Id. at 574.

However, documents do not form a contract where “the parties contemplate further negotiations
and the execution of a formal instrument.” Rubinstein, 395 F. App’x at 788 (quoting Adjustrite
Sys., Inc. v. GAB Bus. Servs., Inc., 145 F.3d 543, 547 (2d Cir. 1998)).
“For a contract to be binding, the parties’ agreement must be definite enough so that the
parties’ intent can be ascertained with some degree of certainty.” Oscar Prods., Inc. v.
Zacharius, 893 F. Supp. 250, 255 n.3 (S.D.N.Y. 1995) (citing Candid Prods., Inc. v. Int’l Skating
Union, 530 F. Supp. 1330, 1333 (S.D.N.Y. 1982)). The plaintiff has the burden of establishing
all essential terms of the alleged contract, with sufficient definiteness that the Court can interpret
its terms. Oscar Prods., 893 F. Supp. at 255.
Here, no reasonable juror could find that the email exchange between Higgins and Caruso
constituted an agreement because Caruso took issue with several of the terms in Higgins’ initial
email and clearly desired further negotiation.
Higgins’ February 17, 2010 email seemingly set forth the terms of an agreement he had
reached with Caruso a week earlier, including that
NASDI is guaranteed a profit margin of 7.5% on [the $12 million project] and if
the profit margin is higher than anticipated, NASDI and Diversified will split the
monies evenly. . . . All decisions on subcontracting will be made by NASDI with
input from Diversified. . . . Project Management and Site Supervision will be paid
27

for by NASDI and selection of the personnel will be made with input from both
NASDI and Diversified with NASDI having control over the final decision.
(Def.’s Ex. F at 001197).
However, Caruso’s reply email, copied and quoted in Higgins’ March 2, 2010 email,
shows that he did not agree to all of those terms. Caruso said that there was:
no guarantee on 7.5%. [W]e said we are going to split everything at the end of
the conversation. I told you there is 15% profit and overhead on the in house
work above direct costs. . . . Just spoke to Paul [Huffer] and there is 2% sub on
top of subs not 3 which is irrelevant because we will buy down as much as we
can. . . . I am under the impression that the entire job will be split and [NASDI]
will lay out all monies. . . . The 15% is an estimate. There are no guarantees on
an estimate. Hopefully it’s more. I would like to beat the 15% if possible. . . . I
also feel like I should have as much say as you when it comes to hiring and
making decisions re the project as you should on the other project. . . . I have no
problem informing you of all decisions. All decisions will be made with
reputation and making money in mind but I will not hurt our rep for a few cents
here and there. I will create a form that you and I could sign or Paul and Greg on
all major decisions just so we[’]re on the same page. I’m sure we[’]ll have some
kinks but we[’]ll get them worked out. Looking forward to these jobs.
(Id. at 001198).
Higgins responded to Caruso’s email saying that
There is a guarantee just like you, me and Chris spoke about and it is at a
MINIMUM 7.5% for NASDI. What was said is a 15% markup on work directly
performed by Diversified and/or NASDI (approximately $12 million[)] and that
we would split the profits evenly if the work outperforms the estimate. It was
clearly stated that NASDI is guaranteed, again, a MINIMUM of 7.5%
profit. . . . This job was brought to NASDI by Diversified with the guarantee that
NASDI would profit from this project. NASDI is NOT in the business of
financing work and NOT making money. If you are not comfortable with the
estimate, then say so and we can proceed in another direction. . . . NASDI will
listen to any and all input, final decisions will be NASDI’s and NASDI’s alone.
NASDI is the one taking the risk on the front end by financing projects and
NASDI therefore will have final say on any and all matters concerning monies,
including hiring personnel. . . . Chris or I will be involved in all major decisions
and we will value whatever input you or Paul [Huffer] have when it comes to the
projects. I don’t know that we need a form, but if you want to create one we can
look at it. Again, NASDI will have final say on all decisions, major or minor.
(Id.).
28

As Caruso’s reply shows, he believed that they had agreed to splitting everything, not just
those profits that were above 7.5%; he also wanted to have as much power in making decisions
as Higgins. Higgins March 2, 2010 email illustrates that they were still working out the details.
Relevant here, Higgins told Caruso that if he did not like the estimate, “then say so and we can
proceed in another direction.” (Id.). As such, neither party intended for the agreement laid out
in the February 17, 2010 email to be binding. Caruso wanted to change some terms, and Higgins
said they could go in a different direction if Higgins did not like the estimate.

While the

Plaintiffs are correct that Higgins’ initial email did not express an intention to further negotiate,
Caruso’s email does. See Rubinstein, 395 F. App’x at 788 (stating that “an exchange of emails”
does not form a contract where “the parties contemplate further negotiations ”). Furthermore,
there is no evidence that the parties intended to be bound by the terms of Higgins’ initial email.
Therefore, there was not a meeting of the minds. See O’Donnell v. King B 100, LLC, No. 1:14CV-1345, 2016 WL 7742779, at *14 (N.D.N.Y. May 3, 2016) (“It is Plaintiff’s burden . . . to
demonstrate the existence of a meeting of the minds, including the parties’ mutual assent and
mutual intent to be bound.” (internal alterations, citations, and quotation marks omitted)).
The emails stand in contrast to the case cited by the Plaintiffs, Scheinmann v. Dykstra,
No. 16 CIV. 5446 (AJP), 2017 WL 1422972 (S.D.N.Y. Apr. 21, 2017). In Scheinmann, an
agreement was reached between two parties’ attorneys. In the initial email, counsel set forth the
terms of the proposed agreement. The opposing attorney answered in an email that “[w]e have a
deal.

I will put together a consent judgment within the next week.” Id. at *1. That same

attorney said in a subsequent email that there was no need for a comprehensive written
agreement because “the entirety of the settlement agreement was defined in their prior emails.”
Id. (internal quotations citations to the record omitted). Here, in contrast, instead of saying that

29

Higgins’ statement of the agreement was correct and that they had an agreement, Caruso wanted
changes to the material terms including how much of the profit would be divided.
The conduct of the parties after the emails further illustrates that there was not a meeting
of the minds. Although the emails said that NASDI and Diversified would split the profits from
the subcontractor buyouts, the memorandum of understanding, the October 27, 2011 letter, the
March 8, 2012 email from Caruso, the spreadsheet, and Caruso’s proposed amendment to the
Superior Subcontract all state that NASDI and Superior would split the profits. If Caruso and
Higgins truly had a meeting of the minds through the emails they exchanged, there would not
have been a need to change the material terms to include a different party altogether.
These documents also show that Caruso desired to have the agreement placed in writing.
The memorandum of understanding contains signature lines for NASDI and Superior and states
that “[s]igning below shall constitute acceptance of this agreement as outlined above.” (Def.’s
Ex. F at 001201).

The October 27, 2011 letter requested that the Superior Subcontract be

amended to include the subcontractor profit sharing. The March 8, 2012 email from Caruso
asked NASDI to “give [him] 50% of buyouts or remove [section 24.13 of the Superior
Subcontract].” (Id. at 001203). Caruso also attempted to amend the Superior Subcontract to say
that “[a]s per out original agreement, a second contract will follow which splits the subcontractor
buyouts 50/50 NASDI + Superior Site.” (Def.’s Ex. I at 013909 (emphasis added)). Caruso
signed the Superior Subcontract a year after the emails with Higgins. By Caruso’s own words,
he believed that the parties intended to place the subcontractor buyout agreement into a formal
agreement.
Therefore, the Plaintiffs have failed to present sufficient evidence to create a question of
fact as to whether NASDI and Diversified made a written agreement regarding the sharing of the

30

subcontractor buyouts.
existed.

No reasonable juror could find that such a binding written agreement

Accordingly, NASDI’s motion for summary judgment pursuant to Rule 56 dismissing

Diversified’s breach of contract claim is granted.
4. As to Diversified’s Unjust Enrichment Claim
NASDI argues that as there was no written agreement, Diversified’s unjust enrichment
claim is barred by the statute of frauds. (Def.’s Mem. of Law at 6). The Plaintiffs did not
respond, in any way, to this argument.

Therefore, Diversified’s unjust enrichment claim is

deemed abandoned. See Sec. II-2 supra. Accordingly, NASDI’s motion for summary judgment
pursuant to Rule 56 dismissing Diversified’s unjust enrichment claim is granted.
5. As to Superior’s Breach of Contract Claims
i. As to Superior’s Claim for Specific Charges
Superior’s claims for specific charges all relate to their supposed rejection of NASDI’s
change order number 5. Superior states that they did not need to notify NASDI in writing of
their rejection of the change order.
NASDI and Superior both signed change order number 5 on October 5, 2012. Superior
claims that, at some point, they disputed several of the line items in change order number 5, and
that they are owed the money from their rejection of those line items.
According to the Second Amended Complaint, Superior’s claim is based on 3.3, 5.2, 6.4,
6.6, and 6.7 of the Superior Subcontract, as well as the change orders themselves. (Second Am.
Compl. ¶¶ 28–32, 75–77). Those sections state that:
3.3 In connection with his Work, the Subcontractor shall submit to NASDI on a
daily basis, on a form approved by NASDI, information detailing the number of
employees working on the Project, their classification, hours worked, type of
work performed, materials utilized, equipment utilized, including information on
the status of shop drawings, submittals and materials or equipment which may be

31

in the course at preparation, manufacture or delivery, and such other information
as NASDI may require.
...
5.2 On the day specified in the Schedule, the Subcontractor shall submit to
NASDI a written requisition for payment complete with sufficient breakdown
data to permit checking and approval, and in a form acceptable to NASDI
showing the proportionate value of the Work complete to that date and,
sufficiently in advance to permit NASDI to forward each Application as required
by the Prime Contract. Applications for Progress Payments received by NASDI
after such date will only be processed by NASDI the following month.
...
6.4 For changes directed by NASDI, which NASDI agrees that the extra work is
compensated Subcontractor shall be entitled to an adjustment in the Subcontract
price, provided Subcontractor gives NASDI written notice within five (5) days
and shall submit the actual Change Order Request within ten (10) days after
receipt of the proposed instruction, and prior to performing such changed Work.
Failure to provide such notice shall be deemed to prejudice NASDI's rights and to
constitute a waiver of such claims by Subcontractor.
...
6.6 If Subcontractor believes the occurrence of some act or event, other than
changes ordered by NASDI, justifies a change in the Subcontract Amount or the
time for performance of the Work, Subcontractor shall notify NASDI in writing
within three (3) days of the occurrence of such act or event and the scope of the
change to allow NASDI to forward the notice to Owner. Failure to provide such
notice shall be deemed to prejudice NASDI's rights and to constitute a waiver of
such claims by Subcontractor.
6.7 The Change Order Request shall consist of the detailed cost estimate
outlining the changes in the work and detailed documentation justifying proposed
changes in time. This estimate shall be computed in accordance with accepted
estimating procedures and in accordance with the terms of the Prime Contract,
and the costs for labor and materials shall be at prevailing rates in the Project area.
Subcontractor shall be allowed the percentage markup for Subcontractors
overhead and profit specified in the schedule unless a lesser percentage is allowed
to NASDI's subcontractors in the Agreement between Owner and NASDI.
(Def.’s Ex. I). In their memorandum of law, the Plaintiffs state that “line items 5F, 5G, 5I, and
5J were rejected in writing.”

(Pls.’ Mem. of Law at 5).

By that logic, they appear to

acknowledge that clauses 6.4 and 6.6 apply to their claims for specific charges, and that they had
to reject the claims in writing.
Yet, later in their memorandum of law, they appear to argue that clauses 6.4 and 6.6 are
inapplicable to their claim for specific charges.
32

(Id. at 15).

This argument contradicts the

Plaintiffs’ claims for specific charges in the second amended complaint, which states that the
claims are based on those very clauses.
If Superior did not have to comply with clauses 6.4 and 6.6 when it rejected the line items
in change order number 5, and those sections do not control, it is unclear what agreement NASDI
breached by failing to pay Superior back for the line items that were rejected. Superior has not
introduced any evidence that the parties made some other agreement regarding the rejection of
change orders. Nor has Superior proffered any case law that would support its position that it
should be compensated without regard for the Superior Subcontract.

(See id. at 14–16).

Therefore, Superior’s claim for specific charges must fail if it is not based on the Superior
Subcontract.
Similarly, to the extent that the Plaintiffs argue that Superior complied with sections 6.4
and 6.6, and that NASDI breached those sections of the Superior Subcontract by failing to pay
them back, that argument fails as well. Sections 6.4 and 6.6 both require that Superior notify
NASDI in writing within a certain period of time when it believes that a change to the
subcontract amount is necessary, whether that change is because of NASDI or because of some
other act or event. The evidence shows that Superior specifically agreed to all of the line items
in change order number 5.

There is no evidence that Superior ever notified NASDI that it

believed that changes to the subcontract amount were necessary because it rejected some of the
line items in that change order. As the subcontract states, failure to notify NASDI in writing of
the changes amounts to a waiver. Instead, the evidence shows that Superior specifically agreed
to all of the line items in change order no. 5
“Under New York law, ‘[e]xpress conditions precedent, which are those agreed to and
imposed by the parties themselves, must be literally performed.’” Travelers Cas. And Sur. Co. v.

33

Dormitory Auth–State of New York, 735 F. Supp. 2d 42, 75 (S.D.N.Y. 2010) (quoting Klewin
Bldg. Co., Inc. v. Heritage Plumbing & Heating, Inc., 42 A.D.3d 559, 840 N.Y.S.2d 144, 145
(2d Dep’t 2007)); see also D.C.R. Trucking & Evacuation, Inc. v. Aetna Cas. and Sur. Co., No.
96 Civ. 3395, 2002 WL 32096594, at *6 (E.D.N.Y. Oct. 31, 2002) (“Failure to strictly comply
with contractual notice and documentation provisions has been held to constitute a waiver of any
claim for damages.”); Perini Corp. v. City of N.Y., 18 F. Supp. 2d 287, 295 (S.D.N.Y. 1998)
(“An ‘enshrined principle’ of New York law requires strict compliance with notice provisions in
general, as recently reaffirmed by the New York Court of Appeals.”); A.H.A. Gen. Constr. v.
N.Y.C. Hous. Auth., 92 N.Y.2d 20, 33, 677 N.Y.S.2d 9, 16, 699 N.E.2d 368, 375 (N.Y. 1998)
(explaining that notice and documentation provisions serve an important public interest in that
they “provide public agencies with timely notice of deviations from budgeted expenditures or of
any supposed malfeasance, and allow them to take early steps to avoid extra or unnecessary
expense, make any necessary adjustments, mitigate damages and avoid the waste of public
funds.”).
“Strict compliance with a contractual notice provision is particularly appropriate when
the relevant provision expressly states that notice of a claim is a condition precedent to bringing
such a claim, and that the consequence of failure to do so is a waiver of the claim.” Mendelsohn
v. Port Auth. Trans-Hudson Corp., No. 11-CV-03820 ADS, 2012 WL 3234107, at *7–8
(E.D.N.Y. Aug. 3, 2012) (Spatt, J.) (collecting cases); see also Northgate Elec. Corp. v. Barr &
Barr, Inc., 61 A.D.3d 467, 468–69, 877 N.Y.S.2d 36, 37–38 (1st Dep’t 2009) (noting that the
“notice clause provide[d] that ‘[i]n default of such notice the claim is waived’”); Morelli
Masons, Inc. v. Peter Scalamandre & Sons, Inc., 294 A.D.2d 113, 742 N.Y.S.2d 6 (1st Dep't

34

2002) (observing that the notice clause “specifically provided that the failure to comply with
such provision would constitute a waiver of the subcontractor’s claim for damages”).
The Plaintiffs rely on Exhibit 2, which they state is Superior’s rejection of back charges
for several line items in change order no. 5. However, as stated above, no one with personal
knowledge authenticated the exhibit.

The affidavit from the Plaintiffs’ attorney merely states

that it is “a true and correct copy of [Superior]’s rejection of the back charges for line items 5F,
5G, 5I, and 5J . . . .” (Decl. of Zabell ¶ 5). Even if the Court were to consider exhibit 2, it is a
collection of receipts and excel spreadsheets that do not show that Superior ever notified NASDI
of its rejection of the line items. This exhibit stands in stark contrast to the Plaintiffs’ other
exhibits, which are change orders addressed to NASDI with specific dates.
In addition, Superior’s October 2012 Release stated that:
[u]pon receipt of the sum of $755,567.95, as payment for Change Orders 5, 6,
and 7 . . . [Superior] will have received final payment, minus retainage under the
terms of the Subcontract or Purchase Order . . . including (1) all labor . . . , (2) all
fixtures and equipment delivered . . . , (3) all materials, fixtures, and equipment
for the Project . . . , (4) all services performed in the construction of the Project,
and (5) all equipment used, or provided for use, in the construction of the
Project. . . . Except for receipt of payment as set forth [above], there are no
outstanding claims against [NASDI] . . . in connection with the work performed in
the construction of the Project. . . . [Superior] waive[s] and release[]s in favor of
[NASDI] . . . all rights that presently exist or hereafter may accrue to [Superior]
by reason of work performed in the construction of the Project through October
11, 2012 . . . to assert or bring any causes of action, claims, suits and demands
which [Superior] ever had or now has against [NASDI] . . . .
(Def.’s Ex. L). The waiver went on to say that Superior did not waive any claims related to
delays, equipment rentals, or owner related extra work.
As Superior explicitly acknowledged that it was accepting a sum certain as payment for
change order number 5; acknowledged that it had no outstanding claims; and waived any claims
that had accrued through October 11, 2012, any claims related to change order 5 were waived by

35

the October 2012 Release. “The law of New York states that where the language with respect to
the parties’ intent is clear and unambiguous, it will be given effect . . . . Here, the plain language
of the [release] releases [Superior for any claims related to change order number 5].” Kay-R
Elec. Corp. v. Stone & Webster Const. Co., 23 F.3d 55, 58–59 (2d Cir. 1994) (internal citations,
quotation marks, and alterations omitted).
Therefore, there is no evidence that Superior ever notified NASDI of its rejection of
several of the line items in change order no. 5; NASDI did not breach the Superior Subcontract;
and Superior’s claim for specific charges fails. Furthermore, Superior signed a release waiving
any claims related to change order number 5.

Accordingly, NASDI’s motion for summary

judgment pursuant to Rule 56 dismissing Superior’s claim for specific charges is granted.
ii. As to Superior’s Claims for Outstanding Extra Work, Change Orders,
and Profit Sharing
The claims for open time and material change orders; pile cap and grade beam reports;
open concrete PSI upgrade change orders; and grade beam through pile cap all arise out of
Superior’s change orders numbered 22, 23, 34, 41, and 67–74. Change orders 22 and 23 were
sent to NASDI on December 31, 2011 for claims that arose about February 2011. (See Def.’s
Ex. C at 186). Change order numbers 34 and 41 were sent to NASDI on February 10, 2012 for
claims that arose on October 17, 2011 when Superior received revised blueprints. Change order
numbers 67 through 74 were sent on April 30, 2012 for claims that also arose out of the October
17, 2011 revised blueprints. According to the change orders, the work on change orders 22, 23,
34, and 41 were all for work that was directed by NASDI. The work in change orders 67
through 74 was directed by the City.
As stated above, the Superior Subcontract requires that Superior submit a notice of a
change in the subcontract price within five days of receiving NASDI’s proposed instruction, and
36

was to send a change order request within ten days of receiving the instruction. (Def.’s Ex. I ¶
6.4). Changes caused by any other event were to be submitted within three days of the event.
(Id. ¶ 6.6).
However, the Court’s analysis does not terminate with the language of the contract.
Although neither side raises the issue, the law in New York states that “when a party knowingly
receives and accepts the benefits of extra work outside the scope of a construction contract orally
directed by himself and his agents, such conduct constitutes a waiver of the requirement [that the
extra work be performed pursuant to a writing].” S. Leo Harmony, Inc. v. Binks Manufacturing
Co., 597 F. Supp. 1014, 1032 (S.D.N.Y. 1984), aff'd, 762 F.2d 990 (2d Cir. 1985); see also U.S.
for Use & Benefit of Evergreen Pipeline Const. Co. v. Merritt Meridian Const. Corp., 95 F.3d
153, 165 (2d Cir. 1996) (“New York law permits an extra work damages claim for extra work,
orally directed, outside the scope of the contract, notwithstanding the provision that a claim for
extra work must be supported by written authorization.” (internal citations omitted)); Gen. Ins.
Co. of Am. v. K. Capolino Constr. Corp., 983 F. Supp. 403, 429 (S.D.N.Y. 1997); Com–Tee, Inc.
v. Bilt Rite Steel Buck Corp., No. 94 Civ. 4215(LMM), 1996 WL 328745, at *3 (S.D.N.Y. June
13, 1996).

Therefore, under New York law, Superior would not be foreclosed from seeking

payment for its extra work that was directed by NASDI despite failing to comply with the
requirements of the Superior Subcontract.
While Superior would normally be able to recover for all of the extra work it performed
at NASDI’s direction, Superior signed two releases on May 2, 2012 and October 16, 2012. The
May 2012 Release released NASDI from any claims related to the Project through April 7, 2012.
The October 2012 Release released NASDI from any and all claims related to the Project
through October 11, 2012, except for those claims related to delays, equipment rentals and owner

37

related extra work claims. NASDI argues that these releases apply to Superior’s claims for open
time and material change orders, and pile cap and grade beam reports.
Superior did not respond to these arguments, and therefore the Court deems Superior’s
lack of response as consenting to NASDI’s arguments regarding waiver.

See Rusyniak v.

Gensini, 07–CV–0279, 2009 WL 3672105, at *1 n.1 (N.D.N.Y. Oct. 30, 2009) (collecting cases
that stand for the proposition that, where plaintiffs do not respond to defendants’ argument made
in their summary judgment motion, plaintiffs are deemed to have consented to defendants'
argument); Di Giovanna v. Beth Isr. Med. Ctr., 08–CV–2750, 2009 WL 2870880, at *10 n.108
(S.D.N.Y. Sept. 8, 2009) (citing cases for proposition that plaintiff's failure to respond to
argument made in summary judgment motion as to why certain claim should be dismissed
constitutes abandonment of claim); Niles v. Nelson, 72 F. Supp. 2d 13, 22 (N.D.N.Y. 1999)
(holding that when a party does not respond to a portion of the opposing party’s motion, they
indicate that they consent to the granting of summary judgment with respect to that portion of the
motion or have abandoned the claim).
As the work in change orders 22, 23, 34, and 41 were directed by NASDI; accrued before
October 6, 2012; and Superior explicitly waived any claims against NASDI related to the Project
through October 11, 2012 except for those claims enumerated above, Superior is barred from
bringing claims for those change orders. Although NASDI does not argue that Superior’s claim
for grade beam through pile cap, based on change order 41, is barred by the waivers, the Court
fails to see how the waivers do not apply to that claim. The change order states that it was
directed by NASDI, it was submitted before the waivers were signed, and Caruso testified that
the claim accrued before the waivers were signed. “The law of New York states that where the
language with respect to the parties' intent is clear and unambiguous, it will be given effect,

38

regardless of one party’s claim that he intended something else. Here, the plain language of the
[release] releases any and all claims not expressly reserved.” Kay-R Elec., 23 F.3d at 58–59
(internal citations, quotation marks, and alterations omitted). Therefore, the claims for open time
and material change orders, pile cap and grade beam reports, and grade beam through pile cap
are dismissed.
NASDI does not argue that the claims related to change orders 67-74 are barred by the
waiver. Indeed, the evidence is unclear as to who directed the change. The change orders state
that the City directed the change, but Caruso testified that NASDI instructed Superior to increase
the PSI in the concrete. NASDI instead argues that Superior failed to comply with the notice
requirements contained in the Superior Subcontract.
The Court finds that a question of fact exists because the October waiver includes a
specific carve out for those claims related to extra work directed by the Owner. Although the
waiver states that Superior would have to, inter alia, show that it is entitled to damages arising
from those claims, it appears that the parties may have considered waiving the contractual notice
requirements by including this clause in the waiver. See Indus. Window, 609 F. Supp. 2d at 342
(“New York courts routinely hold that ‘the general course of conduct between the parties[ ] may
modify or eliminate contract provisions requiring written authorization or notice of claims.’”
(quoting Barsotti’s, Inc. v. Consolidated Edison Co., 254 A.D.2d 211, 212, 680 N.Y.S.2d 88 (1st
Dep't 1998))). That is, by stating that Superior was not waiving its claims related to extra work
directed by the City, NASDI and Superior may have deemed it unnecessary for Superior to
comply with the notice requirements of the Superior Subcontract.
Therefore, Superior’s claim for open concrete PSI upgrade change orders survives.
Accordingly, NASDI’s motion to dismiss that claim is denied.

39

Finally, as to Superior’s claims related to the installation of rebar on the parking lot and
on the slab on grade, the Court finds that they are barred. These claims are not related to extra
work done by Superior, but instead are based upon an alleged agreement of which there is no
evidence. Caruso testified that he and NASDI entered into an agreement regarding sharing the
profits accrued by subcontracting the work. However, he said that the agreement was reduced to
writing. No such agreement was provided to the Court. To the extent that Superior would seek
to rely on an oral agreement, it is unable to do so because it has only plead claims for breach of
written contracts. (See Compl. ¶¶ 75–81 (stating that Superior’s claims are based solely on the
Superior Subcontract and the change orders)).
Even if the Court were to read the Plaintiffs’ memorandum of law broadly to include a
request to amend their complaint to include a breach of an oral contract, it is clear that such a
request at this juncture is improper. It is well settled that a party may not amend its pleadings in
its briefing papers, including in a memorandum in opposition to summary judgment. See Avillan
v. Donahoe, 483 F. App’x 637, 639 (2d Cir. 2012) (summary order) (“The district court did not
err in disregarding allegations Avillan raised for the first time in response to Potter’s summary
judgment motion.” (internal citation omitted)); Shah v. Helen Hayes Hosp., 252 F. App’x 364,
366 (2d Cir. 2007) (summary order) (holding that “[a] party may not use his or her opposition to
a dispositive motion as a means to amend the complaint” (internal citation omitted)); Wright v.
Ernst & Young LLP, 152 F.3d 169, 178 (2d Cir. 1998) (recognizing that a party may not use
opposition to a dispositive motion as a means to amend the complaint); Mediavilla v. City of New
York, 259 F. Supp. 3d 82, 106 (S.D.N.Y. 2016) (“Because this theory of excessive force is raised
for the first time in Plaintiff's opposition to Defendants' motion for summary judgment, I need
not consider it here. It is well settled that a litigant may not raise new claims not contained in the

40

complaint in opposition to a motion for summary judgment.” (internal citations and footnote
omitted)), reconsideration denied, No. 14-CV-8624 (VSB), 2017 WL 4155401 (S.D.N.Y. Sept.
18, 2017); Wright v. Jewish Child Care Ass’n of N.Y., 68 F. Supp. 3d 520, 529 (S.D.N.Y. 2014)
(holding that even pro se plaintiffs are not permitted to assert new claims in opposition to a
motion for summary judgment); Enzo Biochem, Inc. v. Amersham PLC, 981 F. Supp. 2d 217,
223 (S.D.N.Y. 2013) (“It is well settled that a party may not amend its pleadings in its briefing
papers.”

(internal

citations

omitted));

Bentley

v.

Providian

Fin.

Corp.,

No.

02

CIV.5714(WHP)(FM), 2003 WL 22234700, at *3 (S.D.N.Y. Apr. 21, 2003) (“Unfortunately, it
is not appropriate to raise new claims for the first time in submissions in opposition to summary
judgment.” (internal citations and quotation marks omitted)); Caribbean Wholesales & Serv.
Corp. v. U.S. JVC Corp., 963 F. Supp. 1342, 1359 (S.D.N.Y. 1997) (“[Plaintiff] in effect is
apparently attempting to add a claim never addressed, or even hinted at, in the complaint. Such a
step is inappropriate at the summary judgment stage, after the close of discovery, without the
Court's leave, and in a brief in opposition to a dispositive motion.”).

Therefore, Superior’s

claims for rebar parking lot and rebar slab on grade are dismissed.
Accordingly, NASDI’s motion for summary judgment dismissing Superior’s claims for
extra work, change orders, and profit sharing is granted in part and denied in part. It is denied to
the extent that a question of fact exists as to whether the parties’ course of conduct waived the
notice requirements related to extra work directed by the City. Therefore, Superior’s claims for
open PSI upgrade change orders survive. Superior’s remaining claims for extra work, change
orders, and profit sharing are dismissed because Superior waived those claims pursuant to the
May and October 2012 Releases.

41

iii. As to Superior’s Delay Claim
Superior contends that NASDI has to compensate Superior for any costs resulting from
the delays in the Project, and failed to process Superior’s delay claim in a timely fashion.
NASDI states that it is not obligated to pay for any delays that it did not cause, and that it has
fulfilled its obligations.
The law in New York State regarding delays is that:
absent a contractual commitment to the contrary, a prime contractor is not
responsible for delays that its subcontractor may incur unless those delays are
caused by some agency or circumstance under the prime contractor's direction or
control. Contrary to Triangle's contention, there is simply no basis for concluding
that a prime contractor—which often times lacks control over much of the work
to be performed at a particular project—has implicitly agreed to assume
responsibility for all delays that a subcontractor might experience—no matter
what their cause. If a subcontractor wants a prime contractor to be a guarantor of
job performance, it should bargain for the inclusion in its subcontract of a
provision to that effect.
Triangle Sheet Metal Works, Inc. v. James H. Merritt & Co., 79 N.Y.2d 801, 802–03, 588
N.E.2d 69, 70 (N.Y. 1991) (internal citations omitted) (emphasis added).
While neither side addresses the clauses in their memoranda of law, clauses 10.2 and 10.5
create such a liquidating agreement. They state that:
10.2 Subject to Subcontractor’s giving notice and other information, NASDI
shall take all reasonable steps to secure from the Owner, such contractual benefits
that may be claimable on behalf of the Subcontractor. The Subcontractor shall in
sufficient time afford NASDI all information and assistance that may be required
to enable NASDI to claim such Contractual benefits. On receiving such
Contractual benefits from the Owner, NASDI shall pass on to the Subcontractor
such proportion thereof, it being understood that in the case of any claim of the
Subcontractor for any additional payment, NASDI’s receipt of payment from the
Owner shall be a condition precedent to NASDI’s liability to the Subcontractor in
respect of such claim.
10.5 NASDI shall represent the Subcontractor in its claims only to the extent of
passing the claim on to the Owner and shall not be required to actively support
such claims and the Subcontractor shall retain responsibility for the proofs and
processing of the claims. The Subcontractor shall reimburse NASDI all costs
42

incurred including attorneys' fees, in passing such claim on to Owner; the
Subcontractor shall not advance any frivolous or unsupported claims. NASDI is
liable to Subcontractor with respect to claims only to the extent that the Owner is
determined, by litigation or settlement, to be liable to NASDI.
(Def.’s Ex. I (emphasis added)).
“Under Triangle, a contractor may bring an action for delays damages against the owner
on behalf of a subcontractor if a provision in the subcontract permits the ‘prime contractor to be
a guarantor of job performance,’ often asserted as pass-through claims made pursuant to a
liquidating agreement.” William A. Gross Const. Assocs., Inc. v. Am. Manufacturers Mut. Ins.
Co., No. 07CIV10639(LAK)(AJP), 2009 WL 427280, at *8–10 (S.D.N.Y. Feb. 23, 2009)
(quoting Triangle Sheet, 79 N.Y.2d at 802–03, 580 N.Y.S.2d at 172, 588 N.E.2d 69 (internal
footnote omitted)).
There are three elements to a valid liquidating agreement: “ (1) the imposition of liability
upon a party for a third party’s increased costs, thereby providing the first party with a basis for
legal action against the party at fault, (2) a liquidation of liability in the amount of the first
party’s recovery against the party at fault, and (3) a provision for the pass-through of that
recovery to the third party.” Helena Assocs., LLC v. EFCO Corp., No. 06 CIV. 0861(PKL),
2008 WL 2117621, at *9 (S.D.N.Y. May 14, 2008) (quoting N. Moore St. Dev., LLC v.
Meltzer/Mandl Architects, P.C., 23 A.D.3d 27, 32, 799 N.Y.S.2d 485, 489 (1st Dep’t 2005)).
Here, NASDI agreed that it was liable to Superior for any claims that Superior alleged
against the City; agreed to liquidate liability in the amount recovered; and agreed to pass the
recovery to Superior. On its face, clause 10.5 appears to be a valid liquidating agreement. See
Schiavone Const. Co. v. Triborough Bridge & Tunnel Auth., 209 A.D.2d 598, 599–600, 619
N.Y.S.2d 117, 118 (2d Dep’t 1994) (“The subcontract agreement was sufficient to establish a
‘pass through’ claim because it provided that the plaintiff liquidate its liability to the
43

subcontractors in such amounts as may be recovered against the defendants.” (internal citations
omitted); see also Helena Assocs., 2008 WL 2117621, at *9 (“[T]o prove a valid liquidating
agreement with KBF and Rose Associates, Helena must have (1) admitted and acknowledged
liability to KBF and Rose Associates for certain damages arising out of the services provided by
EFCO, (2) agreed to liquidate such liability in the amount it might recover on behalf of KBF and
Rose Associates, and (3) obligated itself to pass through to KBF and Rose Associates the portion
it might recover on behalf of KBF and Rose Associates.” (internal citation omitted)).
Unlike claims for payment related to work done, as discussed below, where courts have
held that “pay-when-paid” clauses are either invalid or set a reasonable period of time for
subcontractors to be paid, pass-through or liquidating agreements are valid and do not contain
such a requirement. See id. at *9 (“Liquidating agreements are often employed on construction
projects to bridge gaps in privity and are recognized under New York law as a valid means of
avoiding the duplicative lawsuits that would otherwise be necessary to ensure that cost overruns
and delay damages are ultimately borne by the responsible party.” (internal citations and
quotation marks omitted)). As NASDI has not yet been paid for Superior’s pass-through delay
claim, Superior cannot be paid for any delays caused by the City. Therefore, NASDI is not liable
to Superior at this time for any delays caused by the City.
However, the evidence shows that NASDI ordered Superior to demobilize, not the City.
As Superior knew even before it mobilized that it would be delayed, it is unclear why NASDI
had Superior mobilize and then demobilize. A trier of fact will have to determine how much, if
any, of the delay was attributable to NASDI.
Further, while it appears that Superior was delayed because a previous subcontractor had
incorrectly installed certain piles, it is not clear from the evidence what if any of that mistake was

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attributable to NASDI. As stated above in the seminal New York State case, a prime contractor
is responsible for delays that its subcontractor incurs if they are caused by some agency or
circumstance under the prime contractor’s direction or control. Triangle Sheet, 79 N.Y.2d at
802, 588 N.E.2d at 70 (internal citations omitted).
As to NASDI’s claim that Superior failed to comply with a condition precedent by not
notifying NASDI of the changes, the Court finds this argument unavailing. NASDI ordered the
change in ordering NASDI to demobilize. Further, when Superior demobilized, it did not know
when it would remobilize. Finally, as discussed above, the October waiver includes a carve-out
for Superior’s delay claims, which indicates that the parties may have deemed the notice
requirement unnecessary for those claims.
Therefore, a question of fact exists as to whether NASDI caused any of Superior’s delays,
and as to whether NASDI is liable for those delays. Accordingly, NASDI’s motion for summary
judgment pursuant to Rule 56 dismissing that claim is denied.
iv. As to Superior’s Claim for Final Payment
NASDI contends that Superior’s claim for final payment is premature because the work
has not been deemed completed, the City has issued back charges against NASDI that relate to
Superior’s work, and NASDI has not yet been paid by the City. Superior argues that it has
completed its work, and that the pay-when-paid clause is unenforceable. The Court finds that a
question of fact exists as to whether Superior should receive its final payment.
As to Superior’s final payment, the Superior Subcontract states that:
Final Payment shall be the unpaid balance of the Subcontract Amount, and shall
become due when the Work described in this Subcontract is fully completed and
performed in accordance with this Subcontract and the Prime Contract, and is
satisfactory to and approved by Owner, Architect and NASDI. Payment of
retention, reserved amounts and final payments shall be made to the

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Subcontractor only upon NASDI’s receipt of the corresponding payment from the
Owner.
(Def.’s Ex. I ¶ 5.9).
The subcontract also states that:
Payments otherwise due, either Progress Payments or Final Payment, may be
withheld by NASDI on account of defective work not remedied, claims filed,
reasonable evidence indicating probability of filing of claims, failure of
Subcontractor to make payments properly to its Sub-subcontractors or for material
or labor, or applicable taxes, fees and fringe benefits, or reasonable doubt that the
Work can be completed for the balance then unpaid, damage to NASDI, other
subcontractors, Owner or the public, reasonable belief that Subcontractor will be
unable to maintain the Project schedule, evidence of financial difficulty or
inability to fully perform this Subcontract, set-offs or back-charges for which, in
NASDI’s reasonable opinion, Subcontractor is or will be liable as a result of its
performance of the Work, or for any other breach of this Subcontract. NASDI
may offset against any sums due Subcontractor hereunder the amount of any
obligations of Subcontractor to NASDI, whether or not arising out of this
Subcontract. In any of the foregoing events, NASDI may, but shall not be
obligated to, make payments directly to Sub-subcontractors.
(Id. ¶ 5.8).
In November of 2015, Caruso testified that Superior had performed its obligations under
the Superior Subcontract. (Def.’s Ex. C at 272). The Plaintiffs contend that Superior is owed
over $400,000 pursuant to the Subcontract and change orders, but have not introduced any
evidence in support of that contention.
Battistoni stated in his affidavit that “Superior may have purportedly ‘completed’ its
work relatively early . . . .” (Battistoni Aff. ¶ 56). As NASDI points out, there is no evidence
that NASDI or the Architect or the City have certified the work as complete. The City has
apparently also issued back charges against NASDI related to Superior’s work that total
$400,506. (See Battistoni Aff. ¶ 57; Def.’s Ex. P).
First, the Court finds that clause 5.9 of the Superior Subcontract does not create a
condition precedent to Superior’s payment, but instead fixes a time for payment. The seminal
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case on the construction of so-called “pay-when-paid” clauses, Schuler-Haas Elec. Corp. v.
Aetna Cas. & Sur. Co., 49 A.D.2d 60, 371 N.Y.S.2d 207 (4th Dep’t 1975), aff’d sub nom.
Schuler-Haas Elec. Co. v. Aetna Cas. & Sur. Co., 40 N.Y.2d 883, 357 N.E.2d 1003 (N.Y. 1976)
summarized the law in New York as follows:
if the parties clearly expressed an intention that no subcontractor . . . should have
the right to be paid or to sue on the payment bond until all questions relating to
the contracts have been resolved and the owner has made his final payment due
under the contract to the general contractor, such agreement would be binding,
and it would constitute a condition precedent to [a subcontractor’s] action against
the surety.
Id. at 64, 371 N.Y.S. at 210. However:
In the absence of a clear expression in the contract papers that the credit risk of
the general contractor and the delay in payment frequently attending on
construction projects are meant to be shifted to such suppliers and subcontractors,
the contract instruments should not be construed as intending such assumption.
Indeed, it is presumed that the parties did not intend that payment of the small
subcontractors should await the determination of an extended legal dispute
between the owner and general contractor over an issue not concerning him or his
work.
Id. In affirming the decision by the Fourth Department in favor of the subcontractor, the New
York State Court of Appeals held:
If as here there is no express language to the contrary in the written document
(and no extrinsic evidence), the standard would seem to be that where payment is
stipulated to occur on an event, the occurrence of the event fixes only the time for
payment; it is not to be imported as a substantive condition of the legal
responsibility to pay.
Schuler-Haas, 40 N.Y.2d at 885, 357 N.E.2d at 1003.
Therefore, clauses relating to payment and risk must be carefully analyzed to determine
whether the contractor and the subcontractor have clearly agreed to transfer the risk of nonpayment to the subcontractor, or whether the language is ambiguous. Federal courts have found
that clauses that provide that the subcontractor will be paid after the contractor is paid by the

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owner have been held to fix a time for payment rather than create a condition precedent to
payment. See Nouveau Indus. Inc. v. Liberty Mut. Ins. Co., No. 08 CIV. 10408 CM, 2011 WL
10901796, at *9 (S.D.N.Y. Sept. 7, 2011).
To that end, clauses that merely fix a time for payment have been construed to only allow
for a reasonable period of time after the completion of the subcontractor’s work. Conviron
Controlled Environments, Inc. v. Arch Ins. Co., No. 14-CV-2030(ADS)(SIL), 2015 WL
12556060, at *6 (E.D.N.Y. Nov. 13, 2015) (Spatt, J.) (quoting Nouveau Indus., 2011 WL
10901796, at *9); see also Power Partners MasTec, LLC v. Premier Power Renewable Energy,
Inc., No. 14CV8420, 2015 WL 774714, at *2 (S.D.N.Y. Feb. 20, 2015) (confirming arbitration
award where “[t]he Arbitrator [] determined that the ‘pay-when-paid’ clause did not excuse
Premier Power from its obligation to pay MasTec. The Arbitrator determined that a ‘pay-whenpaid’ clause affords a general contractor a ‘reasonable’ time to pay a subcontractor and that
‘three years was an unreasonable period of time to withhold payment from MasTec for its
completed work.’” (internal citations to the record and alterations omitted)); Hatzel & Buehler,
Inc. v. Lovisa Const. Co., No. CV-92-384, 1993 WL 276971, at *3 (E.D.N.Y. July 20, 1993) (“It
is clear that clauses that merely provide that the subcontractor will be paid after the owner pays
the general contractor do not create a condition precedent to payment of the subcontractor. They
are construed as allowing the general contractor to postpone payment to the subcontractor for a
reasonable period of time after the completion of the subcontract work.” (emphasis added)
(collecting cases)); Action Interiors, Inc. v. Component Assembly Systems, Inc., 535 N.Y.S.2d 55,
56 (2d Dep’t 1988) (stating that a provision providing that payment to subcontractor was not due
until the owner paid the general contractor, “while providing for a postponement of payment to
permit the general contractor an opportunity to obtain funds from the owner, only requires that

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payment be delayed for a reasonable time after completion of the subcontract work.” (internal
citations omitted)); Schuler-Haas, 49 A.D.2d at 64, 371 N.Y.S.2d at 210 (“[C]ourts have
recognized that as a practical matter the suppliers and small contractors on large construction
projects need reasonably prompt payment for their work and materials in order for them to
remain solvent and stay in business.”).
Conviron, a case previously decided by this Court, is almost directly on point. In that
case, the plaintiff sought, inter alia, the balance of its payment. The provision of the contract in
Conviron which dealt with final payment stated:
after the completion of all the work Framan shall give written notice to the Owner
and the Consultant that all the work is ready for inspection and final acceptance.
The Owner and the Consultant shall promptly make such inspection and, if they
shall determine that all the work has been satisfactorily completed, the Owner
shall thereupon by written notice advise Framan that it accepts such work.
2015 WL 12556060 at *6 (internal alterations omitted). The Court held that the provision was
insufficient to defeat the plaintiff’s motion for summary judgment for final payment because
“[f]ederal courts within this Circuit have recognized that such contractual clauses, which merely
fix the time for payment to a subcontractor, are construed as allowing the general contractor to
postpone payment to the subcontractor only for a reasonable period of time after the completion
of the subcontract work.”

Id. (internal citation and quotation marks omitted) (emphasis in

original).
Therefore, clause 5.9 of the Superior Subcontract does not create a condition precedent to
Superior’s payment, but instead fixes a time, for a reasonable period of time, for Superior to
receive payment. As at least three years have passed since Superior completed its work, NASDI
cannot rely on that clause in support of its motion for summary judgment. A reasonable period
of time has long since passed.

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However, NASDI contends that clause 5.2 of the Superior Subcontract does clearly
transfer the risk of non-payment to Superior. Again, the Court disagrees. Instead of clearly
transferring the risk of non-payment to Superior where defective work is allegedly the fault of
Superior, clause 5.2 merely states that payments to the subcontractor “may be withheld by
NASDI.” (Def.’s Ex. I ¶ 5.2). The Court finds that such a vague, permissive statement does not
support NASDI’s motion for summary judgment. It is not clear from clause 5.2 that NASDI will
withhold any payments that are deemed the fault of NASDI; instead, as the wording of the clause
states, NASDI may withhold payments. As was the case with clause 5.9, such a statement
merely fixes a reasonable period of time for Superior to receive its payment. Despite NASDI’s
evidence that the City has issued back charges against it related to NASDI’s work, the Superior
Subcontract does not clearly state that such money must be withheld from Superior.
Therefore, there is a question of fact as to whether Superior should receive its final
payment.

Accordingly, NASDI’s motion for summary judgment on Superior’s claim for final

payment is denied.
III. CONCLUSION
For the above stated reasons, NASDI’s motion for summary judgment pursuant to Rule
56 dismissing the second amended complaint is granted in part, and denied in part. It is granted
to the extent that all of Harrison’s and Diversified’s claims are dismissed, as are Superior’s
claims for specific charges, and all claims for extra work, change orders, and profit sharing
except for those related to the extra work for open concrete PSI upgrade change orders. It is
denied to the extent that Superior’s delay claim and claim for final payment survive.

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It is SO ORDERED:
Dated: Central Islip, New York
August 3, 2018
__/s/ Arthur D. Spatt___
ARTHUR D. SPATT
United States District Judge

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