Zimmcor (1993) Inc. v. Permasteelisa North America Corp.

Filing 37

MEMORANDUM-DECISION AND ORDER granting 21 Motion for Summary Judgment as to Plaintiff's first cause of action. Signed by U.S. District Judge Mae A. D'Agostino on 3/30/12. (ban)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
____________________________________________
ZIMMCOR (1993) INC.,
Plaintiff,
vs.

1:10-cv-1160
(MAD/DRH)

PERMASTEELISA NORTH AMERICA CORP.,
Defendant.
____________________________________________
APPEARANCES:
OF COUNSEL:
FOX & KOWALEWSKI, LLP
4 Old Route 146
Clifton Park, New York 12065
Attorneys for Plaintiff

EDWARD KOWALEWSKI, JR., ESQ.
BRENDAN R. WOLF, ESQ.

MCNAMEE, LOCHNER, TITUS &
WILLIAMS, P.C.
677 Broadway
Albany, New York 12207-2503
Attorneys for Defendant Permasteelisa

KEVIN LAURILLIARD, ESQ.
MICHAEL J. HALL, ESQ.

Mae A. D'Agostino, U.S. District Judge:
MEMORANDUM-DECISION AND ORDER
I. INTRODUCTION
On September 28, 2010, Plaintiff commenced the instant breach of contract action. See
Dkt. No. 1. On December 16, 2010, Defendant Permasteelisa North America Corp.
("Permasteelisa") filed its answer and a counterclaim against Plaintiff. See Dkt. No. 5. On
December 30, 2010, Defendant Permasteelisa filed a third-party complaint against Turner
Construction Company ("Turner"). See Dkt. No. 6.1

On March 23, 2012, the parties submitted a stipulation of dismissal, voluntarily
dismissing Turner from this action.
1

Currently before the Court is Defendant Permasteelisa's motion for summary judgment as
to Plaintiff's first cause of action. See Dkt. No. 21.

II. BACKGROUND
A.

The parties and relevant background information
This lawsuit arises out of a construction project at the campus of Rensselaer Polytechnic

Institute ("RPI"), in Troy, New York, for the construction of the Experimental Media Performing
Arts Center (hereinafter the "Project"). On or about July 30, 2004, RPI entered into a contract
with Turner, whereby Turner was to serve as the construction manager for the Project (the
"Primary Contract").
Turner entered into a subcontract with Josef Gartner USA ("Gartner") – a division of
Defendant Permasteelisa – whereby Gartner was to perform a portion of the work at the Project
for Turner (hereinafter the "Primary Subcontract"). On June 21, 2005, Plaintiff and Defendant
Permasteelisa, through Gartner, executed a "Secondary Subcontract." See Dkt. No. 21-10.
Pursuant to the Secondary Subcontract, Plaintiff was to perform the design, procurement,
fabrication, assembly, testing, supply, distribution, erection and installation of a portion of the
"Curtain Wall System" that Defendant Permasteelisa had subcontracted with Turner to construct.
After execution of the Secondary Subcontract, Plaintiff's Vice President, Akiva Markus,
served as Plaintiff's project manager for the Project. As Plaintiff's project manager, Mr. Markus
was responsible for overseeing the management of Plaintiff's work, including the design of the
curtain walls, the manufacturing of the components at Plaintiff's facility, the delivery of the

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components to the Project site, installation at the Project site, and payment from Gartner for the
work performed. See Dkt. No. 28-9 at 4.2
As part of monitoring the work performed, Mr. Markus determined if the work that was
performed or proposed to be performed by Plaintiff was additional or extra work beyond what
Plaintiff was required to perform under the Secondary Subcontract. See id. When extra or
additional work was required, Mr. Markus would submit a request for a change order to Joseph
Tizn of Gartner. See id. Mr. Markus and Mr. Tizn would then negotiate the work and its cost;
and, if they were able to reach an agreement, Mr. Tizn would prepare a change order using
Turner's Subcontract Change Order form.
Between March 27, 2006, and continuing through March 9, 2011, Mr. Tizn prepared and
issued thirty-two Subcontract Change Orders. See Dkt. No. 28-1 at 1.3 With the exception of
Subcontract Change Order No. 15, all of the Subcontract Change Orders use Turner's form, which
sets forth a description of the extra or additional work to be performed or the work to be deleted
from the Secondary Subcontract and the cost thereof to be added to or deducted from the
Secondary Subcontract price. See generally Dkt. No. 28-1.

B.

Applicable contract provisions
The Secondary Subcontract incorporates by reference the provisions of the Primary

Subcontract. The Secondary Subcontract provides as follows: "The intention of this Secondary
Sub Contract is to pass down relevant obligations and entitlements from the Primary Subcontract

To avoid confusion, anytime the Court references a specific page number for an entry on
the docket, it will cite to the page number assigned by the Court's electronic filing system.
2

Plaintiff notes that they were unable to locate Subcontract Change Order No. 21. See
Dkt. No. 28-9.
3

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into the Secondary Sub Contract[.]" See Dkt. No. 21-10 at 2. The Secondary Subcontract also
provides, in relevant part, that "[t]he terms and conditions of the Primary Subcontract as defined
and listed in Appendix B, together with any other documents listed in Appendix B, are deemed to
be incorporated into and form part of this Secondary Sub Contract. The Secondary Sub Contract
shall consist of this document together with any documents listed in Appendix B." See id. at 4.
Appendix B to the Secondary Subcontract lists, among other documents, the Primary
Subcontract. See id. at 7. Article V of the Primary Subcontract provides as follows:
Should the Subcontractor be delayed, obstructed, hindered or
interfered with in the commencement, prosecution or completion of
the Work by any cause including but not limited to any act,
omission, neglect, negligence or default of Turner or of anyone
employed by Turner or by any other contractor or subcontractor on
the Project, or by the Architect, the Owner or their contractors,
subcontractors, agents or consultants, or by damage caused by fire
or other casualty or by the combined action of workers or by
governmental directive or order in no wise chargeable to the
Subcontractor, or by any extraordinary conditions arising out of war
or government regulations, or by any other cause beyond the control
of and not due to default, neglect, act or omission of the
Subcontractor, its officers, agents, employees, subcontractors or
suppliers, then except where the General Contract has specific
requirements at variance with the foregoing, in which case the
requirements of the General Contract shall govern the Subcontractor
shall be entitled to an extension of time for a period equivalent to
the time lost by reason of any and all of the aforesaid causes[.]
*********
The Subcontractor agrees that it shall not be entitled to nor claim
any cost reimbursement, compensation or damages for any delay,
obstruction, hindrance or interference to the Work except to the
extent that Turner has actually recovered corresponding cost
reimbursement, compensation or damage from the Owner under the
Contract Documents for such delay, obstruction, hindrance or
interference, and then only to the extent of the amount, if any, which
Turner on behalf of the Subcontractor, actually received from the
Owner on account of such delay, obstruction, hindrance or
interference.
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It shall be an express condition precedent to any obligation on the
part of Turner to make payment of any such cost, reimbursement,
compensation or damages to the Subcontractor hereunder that
Turner shall first be determined to be entitled to such compensation
on behalf of the Subcontractor and then receive such payment from
Owner, and Subcontractor expressly acknowledges that Turner is
not obligated or required to pursue Subcontractor claims as against
Owner if Turner, in its sole discretion, after review of the
Subcontractor's claim, has deemed the claim to lack merit in whole
or in part.
Notwithstanding anything to the contrary above or in this
Agreement, in the event that Turner is solely responsible for delay,
obstruction, hindrance, interference or disruption to Subcontractor
and Turner does not receive payment for the same, Turner shall be
obligated to pay the Subcontractor for its increased costs of
performance, such extended overhead and increased performance
costs resulting from the delays, obstruction, hindrance, interference
or disruption solely attributable to Turner. Turner's liability
hereunder will not include home office overhead, liquidated
damages, attorneys fees and related costs.
See Dkt. No. 21-9 at 3.
In addition to the above provisions, Defendant Turner's Subcontract Change Orders
contained the following language:
Through acceptance of this Change Order, this Subcontractor
acknowledges that it has reviewed the progress of the Work related
to this Project and the potential impact of the additional work on the
progress of the project in the future. As a result, this Change Order
includes compensation to the Subcontractor for any and all effects,
delays, and inefficiencies or similar demands associated with this
Project and the Subcontractor recognizes that there is no basis for
any such claim in the future.
See Dkt. No. Dkt. No. 28 at ¶ 28.4

Plaintiff contends that "Mr. Markus determined that the meaning of the second sentence,
when read in conjunction with the first sentence, was that compensation for any and all claims for
delays and/or inefficiencies related solely to the additional work were included in the Subcontract
Change Order, that such claims would be waived by executing the Subcontract Change Order, and
that claims for delays and/or inefficiencies not related to the additional work would not be
4

(continued...)
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C.

The parties' contentions
In its complaint, in its first claim, Plaintiff contends that its work was "unreasonably

delayed, interfered with and impeded by the acts and omissions of Josef Gartner[.]" See Dkt. No.
1 at ¶ 15. These acts and omissions include Defendant Permasteelisa/Gartner's (1) "[f]ailure to
provide clear architectural design;" (2) "[f]ailure to approve design and engineering plans in a
timely manner;" (3) "[f]ailure to provide information required to resolve and/or resolve
discrepancies between architectural plans and structural plans;" (4) "[f]ailure to approve shop
drawings in a timely manner;" (5) "[f]ailure to address requests for information and/or change
orders in a timely manner;" (6) "[f]ailure to provide sufficient control lines, bench marks and asbuilts of concrete and steel;" (7) "[c]hange in panel installation sequence;" (8) "[f]ailure to provide
structure and site access in a timely manner;" (9) "[f]ailure to provide missing structural members
in a timely manner;" (10) "[f]ailure to resolve glazed louver issue in a timely manner;" (11)
"[f]ailure to provide access to the Project site such that layout work and panel installation could be
performed in a continuous and uninterrupted [manner];" (12) "[d]irecting timing of ordering glass
and aluminum deliveries to plaintiff's manufacturing facility;" and (13) "[d]irecting timing of
plaintiff's manufacturing of glass panels." See id.
In its motion for summary judgment as to Plaintiff's first cause of action, Defendant
Permasteelisa states that, in Plaintiff's Delay Claim dated February 20, 2009, Plaintiff attributes
delay to Defendant Permasteelisa, Defendant Turner, the Project's architect, and Patriot Glass –
Plaintiff's subcontractor. See Dkt. No. 21-13 at 7. As such, Defendant Permasteelisa alleges that
"Plaintiff's claim acknowledges that there were multiple causes for the delay and that Defendant
4

(...continued)

waived." See Dkt. No. 28-9 at 6 (emphasis in original). Defendant Permasteelisa, however,
claims otherwise.
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was not the sole cause of the delay." See id. Specifically, Defendant Permasteelisa claims that
Article V of the Primary Subcontract, which it claims is incorporated by reference into the Second
Subcontract, provides only for an extension of time and does not provide for money damages
when there are multiple causes for the delay. See id. Further, Defendant Permasteelisa claims
that the language contained in the Subcontract Change Orders waives Plaintiff's damages for delay
claim.

III. DISCUSSION
A.

Standard of review
A court may grant a motion for summary judgment only if it determines that there is no

genuine issue of material fact to be tried and that the facts as to which there is no such issue
warrant judgment for the movant as a matter of law. See Chambers v. TRM Copy Ctrs. Corp., 43
F.3d 29, 36 (2d Cir. 1994) (citations omitted). When analyzing a summary judgment motion, the
court "'cannot try issues of fact; it can only determine whether there are issues to be tried.'" Id. at
36-37 (quotation and other citation omitted). Moreover, it is well-settled that a party opposing a
motion for summary judgment may not simply rely on the assertions in its pleading. See Celotex
Corp. v. Catrett, 477 U.S. 317, 324 (1986) (quoting Fed. R. Civ. P. 56(c), (e)).
In assessing the record to determine whether any such issues of material fact exist, the
court is required to resolve all ambiguities and draw all reasonable inferences in favor of the
nonmoving party. See Chambers, 43 F.3d at 36 (citing Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 255, 106 S. Ct. 2505, 2513-14, 91 L. Ed. 2d 202 (1986)) (other citations omitted). Where the
non-movant either does not respond to the motion or fails to dispute the movant's statement of
material facts, the court may not rely solely on the moving party's Rule 56.1 statement; rather, the
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court must be satisfied that the citations to evidence in the record support the movant's assertions.
See Giannullo v. City of N.Y., 322 F.3d 139, 143 n.5 (2d Cir. 2003) (holding that not verifying in
the record the assertions in the motion for summary judgment "would derogate the truth-finding
functions of the judicial process by substituting convenience for facts").

B.

Defendant Permasteelisa's claim that Plaintiff waived its right to delay damages
when it signed a change order containing waiver language
In its motion for summary judgment, Defendant Permasteelisa claims that Plaintiff waived

its right to delay damages when it signed Change Order A-30 on November 2, 2007. See Dkt. No.
21-13 at 8. Defendant Permasteelisa states that Change Order A-30 contains the following
language, which waived any of Plaintiff's future claims for compensation on account of delay:
"'Through acceptance of this Change Order, this Subcontractor acknowledges that it has reviewed
the progress of the Work related to this Project and the potential impact of the additional work on
the progress of the project in the future. As a result, this Change Order includes compensation to
the Subcontractor for any and all effects, delays, insufficiencies or similar demands associated
with this Project and the Subcontractor recognizes that there is no basis for any such claim in the
future.'" See id. (quoting Exhibit "D" to Tizn Affidavit). Defendant Permasteelisa alleges that the
Second Circuit in Mafco Elec. Contractors v. Turner Construction Co., 357 Fed. Appx. 395 (2d
Cir. 2009), reviewed change order language identical to the language in Change Order A-30 and
found that "'[t]he language of these provisions unambiguously relieves Turner of liability for the
alleged delays.'" See id. (quotation omitted).
Plaintiff, however, contends that the language of the Change Order waiver is susceptible to
differing interpretations; and, therefore, the Court may examine parol evidence to determine the
parties' intent and that the parties intended the Change Order waiver to relate solely to the
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additional work included in that particular Change Order. See Dkt. No. 28-9 at 11-13. Further,
Plaintiff claims that Defendant Permasteelisa's project manager confirmed this understanding and
that Defendant Permasteelisa is now estopped from enforcing this waiver language. See id. at 13.
Finally, Plaintiff claims that "to read the waiver language to mean that the execution of a
Subcontract Change Order would result in the waiver of any and all claims for delays or
inefficiencies related to the entire Project is absurd from a practical perspective in that it would
prevent the subcontractor from executing any Subcontract Change Order during the course of a
project until all claims for delays or inefficiency were resolved." See id. at 13-14.
Under New York law, a plaintiff alleging a breach of contract claim must establish the
following elements: (i) the existence of a contract; (ii) adequate performance of the contract by the
plaintiff; (iii) breach by the other party; and (iv) damages suffered as a result of the breach. See
Harsco Corp. v. Segui, 91 F.3d 337, 348 (2d Cir. 1996); see also Wolff v. Rare Medium, Inc., 171
F. Supp. 2d 354, 357-58 (S.D.N.Y. 2001) (citation omitted). "When the terms of a written
contract are clear and unambiguous, the intent of the parties must be found within the four corners
of the contract, giving practical interpretation to the language employed and the parties' reasonable
expectations." 131 Heartland Blvd. Corp. v. C.J. Jon Corp., 82 A.D.3d 1188, 1189 (2d Dep't
2011) (citations omitted).
"In reviewing a written contract, a trial court's primary objective is to give effect to the
intent of the parties as revealed by the language they chose to use." Seiden Associates, Inc. v.
ANC Holdings, Inc., 959 F.2d 425, 428 (2d Cir. 1992) (citing Slatt v. Slatt, 64 N.Y.2d 966, 967,
488 N.Y.S.2d 645, 477 N.E.2d 1099 (1985)). "When the question is a contract's proper
construction, summary judgment may be granted when its words convey a definite and precise
meaning absent any ambiguity." Id. (citations omitted). "Where the language used is susceptible
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to differing interpretations, each of which may be said to be as reasonable as another, and where
there is relevant extrinsic evidence of the parties' actual intent, the meaning of the words become
an issue of fact and summary judgment is inappropriate . . . since it is only when there is no
genuine issue as to any material fact that the moving party is entitled to judgment as a matter of
law." Id.
The Second Circuit has "defined ambiguous language as that which is '"capable of more
than one meaning when viewed objectively by a reasonably intelligent person who has examined
the context of the entire integrated agreement and who is cognizant of the customs, practices,
usages and terminology as generally understood in the particular trade or business."'" Id.
(quotations omitted). "Conversely, language is not ambiguous when it has '"a definite and precise
meaning, unattended by danger of misconception in the purport of the [contract] itself, and
concerning which there is no reasonable basis for a difference in opinion."'" Id. (quotations
omitted). "Ambiguity is determined within the four corners of the document; it cannot be created
by extrinsic evidence that the parties' intended a meaning different than that expressed in the
agreement and, therefore, extrinsic evidence 'may be considered only if the agreement is
ambiguous.'" Brad H. v. City of New York, 17 N.Y.3d 180, 186 (2011) (quotation and other
citations omitted).
In Mafco Elec. Contractors v. Turner Construction Co., 357 Fed. Appx. 395 (2d Cir.
2009), the defendant hired the plaintiff as an electrical subcontractor.5 The plaintiff filed an action
against the defendant to recover additional costs associated with delays in completing the contract.
The defendant responded that the plaintiff was precluded from seeking such costs under the
contract's no damage for delay clause and filed a motion for summary judgment. The plaintiff
5

The Court notes that Mafco Elec. Contractors was decided pursuant to Connecticut law.
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argued that the costs it incurred were covered by exceptions to the clause. The court granted the
defendant's motion, noting that the plaintiff had waived any claims it might have had for the delay
costs, whether an exception applied or not, by signing change orders that contained language that
relinquished such rights. See id. at 397. Specifically, the Second Circuit held that "MAFCO's
claim is foreclosed by a series of clear, unconditional release and waiver forms signed by MAFCO
during the course of the project." Id. (footnote and citation omitted). The more than two dozen
change orders that the plaintiff signed contained the following language:
Through acceptance of this Change Order, this Subcontractor
acknowledges that it has reviewed the progress of the work related
to this Project and the potential impact of the additional work on the
progress of the project in the future. As a result, this Change Order
includes compensation to the Subcontractor for any and all effects,
delays, inefficiencies or similar demands associated with this
Project and the Subcontractor recognizes that there is no basis for
any such claim in the future.
Id. Based on this, the court held that "[t]he language of these provisions unambiguously relieves
Turner of liability for the alleged delays." Id. (citation omitted).
In the present matter, all Subcontract Change Orders, with the exception of Subcontract
Change Order No. 15, use Turner's form. See Dkt. No. 28 at ¶ 26. All of the Subcontract Change
Orders, with the exception of Subcontract Change Order No. 15, include the following language:
Through acceptance of this Change Order, this Subcontractor
acknowledges that it has reviewed the progress of the Work related
to this Project and the potential impact of the additional work on the
progress of the project in the future. As a result, this Change Order
includes compensation to the Subcontractor for any and all effects,
delays, inefficiencies or similar demands associated with this
Project and the Subcontractor recognizes that there is no basis for
any such claim in the future.
See id. at ¶ 28. From March 27, 2006 through March 9, 2011, Plaintiff executed over thirty
Subcontract Change Orders containing this unambiguous language. See Dkt. No. 28-1. These
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Subcontract Change Orders were submitted during the time which Plaintiff seeks damages for
Defendant Permasteelisa's alleged delays.
Contrary to Plaintiff's contentions, and as the Second Circuit made clear, the waiver
language, contained in all but one of the Subcontract Change Orders, is unambiguous. See Mafco
Elec. Contractors, 357 Fed. Appx. at 397. To the extent that Plaintiff attempts to rely on evidence
outside of the four corners of the Subcontract Change Order to create ambiguity, its arguments are
precluded by the parol evidence rule. See Brad H., 17 N.Y.3d at 186.
Moreover, Plaintiff argues that Defendant Permasteelisa should be equitably estopped
from enforcing the waiver language because Gartner's project manager, Joseph Tizn, spoke with
Plaintiff's project manager, Mr. Markus, and Mr. Tizn confirmed Mr. Markus' belief that the
waiver language waived claims for compensation on account of delays solely with respect to the
additional work set forth in the Subcontract Change Order. See Dkt. No. 28-9 at 11-13. This
argument, however, is merely an attempt to circumvent the parol evidence rule by invoking the
term "equitable estoppel," and, therefore, must fail. See Royal Mortgage Corp. v. Federal Deposit
Ins. Corp., 20 F. Supp. 2d 664, 669-70 (S.D.N.Y. 1998) (holding that "[c]ourts in New York have
rejected similar efforts to circumvent the parol evidence rule by claiming estoppel" (citations
omitted)). As in Royal Mortgage Corp., "the equitable estoppel argument forwarded by [P]laintiff
in this case goes to the heart of what the agreement between the parties was, and fails for that
reason." Id. at 670 (citations omitted).6

Moreover, the Court notes that nothing in the record indicates that Plaintiff was
deliberately deceived by Defendant Permasteelisa or Mr. Tizn, a required element of an equitable
estoppel claim under New York law. See General Electric Capital Corp. v. Armadora, S.A., 37
F.3d 41, 45 (2d Cir. 1994) (stating the elements of equitable estoppel under New York law)
(citation omitted).
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Based on the foregoing, the Court grants Defendant Permasteelisa's motion for partial
summary judgment and dismisses Plaintiff's first claim. In light of this, the Court will not reach
the merits of Defendant Permasteelisa's argument that Plaintiff's first cause of action is barred by
the "no damage for delay" clause of the Contract.

IV. CONCLUSION
After carefully reviewing the entire record in this matter, the parties' submissions and the
applicable law, and for the above-stated reasons, the Court hereby
ORDERS that Defendant Permasteelisa's motion for summary judgment as to Plaintiff's
first cause of action is GRANTED; and the Court further
ORDERS that the Clerk of the Court shall serve a copy of this Memorandum-Decision
and Order on all parties in accordance with the Local Rules.
IT IS SO ORDERED.
Dated: March 30, 2012
Albany, New York

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