Preview
FILED: WESTCHESTER COUNTY CLERK 04/19/2013 INDEX NO. 56860/2012
NYSCEF DOC. NO. 88 RECEIVED NYSCEF: 04/19/2013
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF WESTCHESTER
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BERGASSI GROUP LLC., N.Y. MATERIALS LLC.
AND MVM CONSTRUCTION LLC.,
Index No. 56860/2012
Plaintiffs,
-against-
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.,
Defendant.
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PLAINTIFF BERGASSI GROUP LLC.’S REPLY MEMORANDUM
OF LAW IN SUPPORT OF MOTION TO RENEW AND REARGUE
PRELIMINARY STATEMENT
Plaintiff Bergassi Group LLC. (“Bergassi”) brings this motion to have its claims restored
that were dismissed in this Court’s January 3, 2013 decision (“Decision’) in response to
Consolidated Edison Company of New York, Inc.’s (“Con Edison”) motion to dismiss. The
Court is referred to the Affidavit of Edmund J. Bergassi, Affidavit of Michael C. Delisa and
Reply Affidavit of Edmund J. Bergassi for factual support for this Memorandum of Law and the
moving Memorandum of Law.
After the Decision was released, Bergassi discovered new, previously unknown,
information that it did not have access to until that point. This new evidence revealed that Con
Edison released funds to Qualcon more than 12 times after November 7, 2011 - the date Bergassi
filed its lien. Con Edison even made payments to Qualcon after it filed for bankruptcy. And
since Con Edison failed to contest this new fact in its opposition papers, Con Edison has now
admitted these payments were made to Qualcon after the Bergassi lien was filed.
Thus, the Court’s holding that “indeed, it was not until at least a week after Con Ed
released the funds at the end of October that Bergassi filed its lien on November 7” (Decision,
37) was based on inaccurate information presented by Con Edison. It is respectfully submitted
that this new evidence should fundamentally alter this Court’s rationale relied upon in dismissing
the Bergassi claims. Bergassi properly filed its mechanic’s lien, relied on assurances by Con Ed
that it would get paid, and nevertheless, Con Edison released payments to Qualcon after Bergassi
filed its lien. Based on this new evidence, Bergassi’s claims are essentially analogous to its co-
plaintiffs who successfully pleaded viable causes of action as held in the Decision.
Most importantly, this new evidence reveals critical factual disputes that can now only
be resolved through discovery and possibly trial. In light of these very clear factual disputes, this
Court should not dismiss Bergassi’s claims in a motion to dismiss, since, as stated in the
Decision, “the documentary evidence that forms the basis of the defense must be such that it
resolves all factual issues as a matter of law, and conclusively disposes of the plaintiffs claim
. . . To qualify as ‘documentary’, the evidence relied upon must be unambiguous and
undeniable” (emphasis added)(Decision, 21-22). In dismissing Bergassi claims, this Court
stated that it relied on “undisputed and documentary facts” (Decision, 38), but based on the new
evidence presented in this motion, those “facts” have been proven to be untrue.
Therefore, the Court should grant Bergassi’s motion to renew and/or reargue.
ARGUMENT
POINT ONE
IT IS WITHOUT QUESTION THAT GENUINE FACTUAL DISPUTES EXIST
RELATING TO CON EDISON’S PAYMENTS TO QUALCON
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The reason courts are reluctant to grant the relief requested in a motion to dismiss is that
facts are often not resolved that early in a litigation. Mary Imogene Bassett Hosp. v. Hospital
Plan, Inc., 89 A.D.2d 240, 455 N.Y.S.2d 416 (4th Dept. 1982) (motion to dismiss seldom granted
unless moving papers conclusively establish that plaintiff does not have a cause of action). As
stated in the Decision, “The pleading is to be liberally construed and the pleader afforded the
benefit of every possible favorable inference.” (Decision, 20). see also Rovello v. Orofino
Realty Co., Inc., 40 N.Y.2d 633, 389 N.Y.S.2d 314 (1976).
Based on the evidence before it, the Decision relied on inaccurate information contained
in Con Edison’s moving papers causing the Court to believe that “it was not until at least a week
after Con Ed released the funds at the end of October that the Bergassi filed its lien on
November 7” (emphasis added) (Decision, 37). Now that Bergassi has proven to the Court that
Con Edison released funds to Qualcon on more than 12 occasions after November 7, 2011, this
Court is faced with a significant factual dispute relating to the dates on which Con Edison made
payments to Qualcon, how many payments were made to Qualcon, and why Con Edison
continued to make payments to Qualcon after being served with Bergassi’s lien.
Bergassi’s causes of action should not be set aside in this motion to dismiss – a drastic
remedy – when triable issues of fact exist. While the Court relied on “documentary evidence” in
the Decision, it was misled by Con Edison’s moving papers. No documentary evidence exists in
this case that would prove Con Edison released all funds allegedly owed to Qualcon prior to
Bergassi filing its lien.
Since the Decision states that “the Court is required to determine whether the proponent
of the pleading has a cause of action” (Decision, 20), and Bergassi is entitled to “every possible
favorable inference” (Decision, 20), and Con Edison has admitted that it made payments to
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Qualcon after Bergassi filed its lien – meaning the Bergassi lien was binding on Con Edison
prior to when it released funds to Qualcon – and the alleged documentary evidence is now in
dispute, it is hereby requested that Bergassi’s five causes of actions for trust fund diversion,
breach of fiduciary duties, conversion, constructive trust and negligence be restored. Bergassi
has demonstrated through the new evidence that it has viable cause of action, and further,
Bergassi has raised triable issues of fact relating to claims made by Con Edison in its motion to
dismiss. The Court is respectfully referred to Bergassi’s moving memorandum of law where
each of these causes of action is addressed in detail.
POINT TWO
DUE TO CON EDISION’S ADMISSION, THERE ARE FACTS IN DISPUTE,
AND THE COURT SHOULD REJECT THE MOTION TO DISMISS
UNDER CPLR 3211(d) BECAUSE FACTS ARE UNAVAILABLE
CPLR 3211(d) sets forth:
(d) Facts unavailable to opposing party. Should it appear from affidavits
submitted in opposition to a motion made under subdivision (a) or (b) that facts
essential to justify opposition may exist but cannot then be stated, the court
may deny the motion, allowing the moving party to assert the objection in his
responsive pleading, if any, or may order a continuance to permit further
affidavits to be obtained or disclosure to be had and may make such other order as
may be just.
As stated above, the facts relating to the timeliness of Con Edison’s payments to Qualcon
for the fraudulent bond discharge are unclear and in dispute. Bergassi was only able to bring this
motion because it received information from an attorney not involved in this case (see Affidavit
of Michael C. Delisa in moving papers) regarding Con Edison’s payments to Qualcon after
Bergassi filed its lien. Without being allowed to conduct discovery in this action, Bergassi has
been forced into a significant disadvantage. For example, Con Edison was clearly not
forthcoming in the prior motion in failing to mention that it made payments to Qualcon after
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Bergassi filed its lien. Therefore, it is respectfully requested that the Court deny the motion to
dismiss based on the new evidence, grant the motion to renew and reargue, and/or utilize CPLR
3211(d) to allow Bergassi to fully litigate this case by engaging in discovery and proving its
claims.
POINT THREE
CON EDISON’S OPPOSITION PAPERS ARE PROCEDURALLY FLAWED
Con Edison failed to provide this Court with an affidavit of an employee or representative
with personal knowledge of the facts at issue in the motion. An attorney affirmation from Con
Edison’s legal counsel, who does not have a basis for actual and personal knowledge, is not
acceptable and cannot be relied upon to defeat Bergassi’s motion herein. It is respectfully
requested that this Court reject this affirmation and not consider it. Once Bergassi identified the
triable issues of fact presented in this case relating to Con Edison’s payments to Qualcon, this
issue could not be addressed by Con Edison through an attorney affirmation. While it has long
been a requirement that summary judgment motions include an affidavit by a person with
knowledge of the facts under CPLR 3212, Zuckerman v City of New York, 49 N.Y.2d 557,
427 N.Y.S.2d 595 (1980), an attorney affirmation from Con Edison cannot properly address
factual disputes posed by this motion under CPLR 3211.
Further, Points 2, 3, 4, 5 and 6 in Con Edison’s memorandum of law address issues that
were previously reviewed in the Decision, and this Court did not affirmatively rule in Con
Edison’s favor on any of these arguments. Therefore, it is unclear why Con Edison is raising
these issues in opposition to this motion to renew and reargue. These points appear more like the
arguments in a cross-motion, which was not brought. Remarkably, Con Edison even refers this
Court to its memorandum of law filed in a motion to renew and reargue that Con Edison
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currently has pending before this Court, which demonstrates its failure to address the issues
posed by this motion.
It is respectfully submitted that Bergassi has presented a very clear legal issue in this
motion – has Bergassi met the standard for a motion to renew and reargue under CPLR 2221 for
this Court to grant the relief sought based on this new evidence presented? None of the
arguments in Points 2, 3, 4, 5 and 6 in Con Edison’s Memorandum of Law are probative on this
question presented in the instant motion and should therefore be rejected.
POINT FOUR
BERGASSI’S CLAIMS DO NOT NEED
TO BE IDENTICAL TO CO-PLAINTIFFS
Con Edison argues in its opposing memorandum of law that it is necessary for Bergassi
to prove that its causes of action are identical to those pleaded by co-plaintiffs. This argument is
without basis in law, and Con Edison fails to cite any case that would cause such a requirement.
Con Edison argues that despite the new evidence presented in this motion, Bergassi cannot
properly plead public trust diversion because it did not file its lien prior to Con Ed filing and
withdrawing the interpleader action and the fraudulent lien discharge bonds being issued, and
further, there were no communications between Con Edison and Bergassi regarding the validity
of lien and assurances that funds were being retained.
The only burden that Bergassi must meet here is that the new evidence provides it with a
cause of action. Bergassi has met its burden under CPLR 2221 by presenting the Court with
“new facts not offered on the prior motion” that would cause the Court to “change the prior
determination,” since the failure to present such facts during the prior motion have a “reasonable
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justification” - the facts were discovered after the Decision was released and were not a part of
the public record nor easily discoverable.
As addressed in detail in Bergassi moving memorandum of law, Bergassi has met the
pleading requirements for trust fund diversion. The newly discovered evidence places Bergassi
in a similar position to its co-plaintiffs to the extent that: (a) it relied on contractual procedural
safeguards from Con Ed that it would get paid; (b) it served Con Ed with a lien, giving Con Ed
actual notice that Qualcon had not paid him; and (c) subsequent to this notice, Con Ed released
payments to Qualcon, without requiring that said lien be discharged through a duly issued bond.
Further, there is no evidence in the record - especially since no discovery has been
conducted – as to the degree of communication between Bergassi and Con Edison prior to
Bergassi filing its lien. It has not been alleged by Con Edison by someone with personal
knowledge that no such conversations were held with Bergassi regarding the validity of the lien
and funds being retained, similar to those between Con Edison and the co-plaintiffs. This void in
the record is another good example of why Bergassi should be provided with the opportunity to
conduct discovery to help prove its claims against Con Edison.
Finally, while Con Edison questions Bergassi citing to Land-Site Contr. Corp. v Marine
Midland Bank, N.A., 177 A.D.2d 413, 414 (1st Dept, 1991), Bergassi stands by this case as
supportive of its claims. This motion is based on newly discovered and previously unavailable
evidence that establishes that Con Edison made payments to Qualcon after Bergassi served its
lien, and therefore, Con Edison had actual and/or constructive notice that Qualcon had not paid
Bergassi. Bergassi is a beneficiary to a statutory trust created by Article 3-A of the New York
Lien Law, similar to co-plaintiffs, since it gave notice to Con Edison, through its lien, that it had
not been paid, and Land-Site Contr. Corp. is supportive of this point.
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CONCLUSION
For all those reasons stated above, Bergassi’s motion for renewal should be granted, and
its causes of action for: (1) trust fund conversion under Article 3-A of the lien law; (2) breach of
fiduciary duty; (3) conversion; (4) a constructive trust; and (5) negligence should be reinstated;
and Plaintiff’s motion to reargue should be granted finding that Bergassi filed a valid public
improvement lien.
Dated: New Rochelle, New York
April 18, 2013
Respectfully submitted,
/s/James Maisano
James Maisano, Esq.
Attorney for Plaintiff
BERGASSI GROUP LLC.
93 Wilson Drive
New Rochelle, NY 10801
(914) 636-1621
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