weakness of Morrell's claim. See Sanitoy, Inc. v. Shapiro, 705 F. Supp. 152, 155 (S.D.N.Y. 1989).
In Bankers Trust, the court found a special relationship between a bank and a borrower where there was an agreement to lend funds confirmed by the bank's executive vice-president. After the borrowers formed a corporation and incurred substantial personal indebtedness in reliance on the bank's promise, the bank refused to make the agreed upon loans. The court concluded there was a special relationship, in part because the bank officer had actively solicited the borrower's business, and the borrower had sought the bank officer's "advice and assistance." 409 N.Y.S.2d at 67. Here, by contrast, there is no suggestion that Congress had any role in inducing Morrell to purchase Dinner Bell's assets or that Morrell sought out or relied upon Congress' advice or counsel. Rather, the evidence reveals two sophisticated parties bargaining at arms-length for individual protection.
In White, the court found a special relationship between a limited partner of a partnership and the partnership's accounting firm. The ruling was based largely on the court's finding that the accountants owed a duty of care to third-party beneficiaries of the service contract to audit the partnership. 372 N.Y.S.2d at 320. The issue before the White court, therefore, was whether to extend a recognized fiduciary duty to include limited partners. Here, by contrast, there is no allegation that Congress owed a fiduciary duty to Dinner Bell which could be extended to apply to Morrell. In fact, the evidence supports the conclusion that because Congress and Dinner Bell were parties to an arms-length transaction, there was no fiduciary relationship. See Compania Sud-Americana de Vapores, S.A. v. IBJ Schroder Bank & Trust Co., 785 F. Supp. 411, 1992 U.S. Dist LEXIS 1948, at*40 (S.D.N.Y. Feb. 24, 1992).
In Coolite, the court found a special relationship between a distributor and a distributee because the defendant had required the plaintiffs to form a new company before agreeing to enter a long term distributorship agreement. The court found that the plaintiff's investment of $ 500,000 attested that the parties relationship was "intrinsically a more intimate relationship association, at least in terms of reliance and trustworthiness, than that of the commonly encountered buyer and seller." 384 N.Y.S.2d at 811. By contrast, the alleged agreement here did not require any additional effort or investment by Morrell which would indicate that Congress' relationship was "more intimate" than the ordinary contractual relationship.
Mathis can also be distinguished. There, the defendants had agreed to supply the plaintiffs with data processing services. A year later, defendants attempted to induce the plaintiffs not to cancel the contract by promising to sell them computer equipment and to develop software necessary for the plaintiffs' business. The court held that the promises, representations, and warranties related to this long-term service contract created a special relationship between the parties. 480 N.Y.S.2d at 178. Here, Morrell does not even allege the existence of a long-term relationship accompanied by detailed warranties and representations from Congress.
Accordingly, because there is no evidence that the Congress-Morrell relationship was a special relationship with a closer degree of trust and confidence than the ordinary contractual relationship, Morrell's claim of negligent misrepresentation is denied as a matter of law.
VI. VIOLATION OF IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING
In Cross & Cross Properties, Ltd. v. Everett Allied Co., 886 F.2d 497, 502 (2d Cir. 1989), the Second Circuit stated:
Courts applying New York law repeatedly have recognized the duty of good faith and fair dealing, the "implied obligation to exercise good faith not to frustrate [a] contract into which [one has] entered." Since the duty of good faith and fair dealing is implied in every contract, contracting parties' fields of discretion under a contract are bounded by the parties' mutual obligation to act in good faith. The boundaries set by the duty of good faith are generally defined by the parties' intent and reasonable expectations in entering the contract (citations omitted).
Morrell argues that it was improper for Congress to enter into the Congress/Morrell Agreement having conveyed to Morrell the understanding "both in numerous conversations and in explicit written agreements" that Congress would continue to extend financing to Dinner Bell, while Congress knew that it would drastically reduce that financing the day after the closing. Def. Br. at 21. Morrell asserts that such behavior deprived it of the benefits of the transaction and constituted a breach of the implied covenant of good faith and fair dealing in the Congress/Morrell Agreement.
To the extent that Morrell's claim relies on promises made by Congress in the alleged oral agreement, proof of that claim is barred by the parol evidence rule. To the extent that Morrell's claim relies on promises made by Congress in the Financing Amendment, it is equally deficient. In Metropolitan Life Ins. Co. v. RJR Nabisco, Inc., 716 F. Supp. 1504 (S.D.N.Y. 1989), the court refused to apply the implied covenant of good faith in an indenture to create additional benefits which were not bargained for the express agreement between the parties. The court held:
While the Court stands ready to employ an implied covenant of good faith to ensure that such bargained for rights are performed and upheld, it will not, however, permit an implied covenant to shoehorn into an indenture additional terms plaintiffs now wish had been included.
716 F. Supp. at 1519. Likewise, here Morrell attempts to transform the implied covenant in the Congress/Morrell Agreement into an additional promise by Congress to continue to make loans to Dinner Bell irrespective of Dinner Bell's collateral position. That simply was not a term bargained for in the written agreement between the parties. All Congress agreed to do in the Financing Amendment was to continue to make funds available to Dinner Bell pursuant to the Advance Formula. There is no allegation that Congress breached that agreement. Accordingly, Morrell's claim must be rejected as a matter of law.
Because no reasonable trier of fact could find in favor of Morrell with regard to its defenses and counterclaims, Congress' motion for summary judgment on its claim for $ 1,876,809.31 is granted. The parties are ordered to attend a pre-trial conference with respect to the remaining claim on April 28, 1992 at 9:00 a.m. in courtroom 302.
IT IS SO ORDERED.
Dated: New York, New York
April 20, 1992
Robert P. Patterson, Jr.