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April 1, 1998


Robert L. Carter, U.S.D.J.

The opinion of the court was delivered by: CARTER


ROBERT L. CARTER, District Judge

 This motion for summary judgment is brought by defendant Fresh Fields Markets, Inc. ("Fresh Fields") pursuant to Rule 56, F.R. Civ. P. Defendant contends that claims by the plaintiff, Enterprise Press, Inc. ("Enterprise Press"), for breach of contract, quantum meruit, should be dismissed on grounds that no genuine issue of material fact exists in support of them.


 In 1993 defendant Fresh Fields, a chain of full-service natural foods supermarkets, began using a direct marketing agency, Market Imaging Systems, Inc. ("MIS"), to handle certain marketing functions. These functions included handling defendant's frequent shopper program and its direct mailing campaign; preparing and mailing defendant's newsletter; and performing data processing and analysis. (Def. Stmnt. of Facts at 2).

 For each function that it was hired to carry out, MIS submitted a proposal and bill estimate to the defendant. Once defendant approved its proposal, MIS assumed responsibility for producing a finished product. Id.

 In completing projects for the defendant, MIS performed certain productions in-house and hired subcontractors to perform other aspects of the production process. (Affdvt. of Joe Dobrow at 1; Affdvt. of Spence Hapoienu at 1). These outside vendors were selected independently by MIS without consultation with Fresh Fields. (Hapoienu Affdvt. at 2). Fresh Fields paid MIS directly for the total cost of each project that it had been hired to complete. Id. Any subcontractors hired by MIS to assist in the completion of marketing projects for Fresh Fields billed MIS for their work. Id.

 The plaintiff, Enterprise Press, a printing and mailing service, was one of the many outside vendors used by MIS to assist in the completion of certain projects for defendant Fresh Fields in 1994. (Dobrow Affdvt. at 4). The instant action arises from MIS' failure to pay Enterprise Press for certain printing services rendered between April 30, 1994 and July 30, 1994, that were used by MIS to complete projects for Fresh Fields. (Complt. at 2-3).

 Plaintiff unsuccessfully has attempted to collect payment for these services from MIS. On August 17, 1995, MIS and the plaintiff entered into a settlement agreement before Magistrate Judge Andrew Peck in which MIS agreed to pay $ 150,000 to the plaintiff to settle its account for the period in dispute. Id. at 2. MIS has not honored this agreement. Id. at 3.

 Unable to collect from MIS, plaintiff now argues that Fresh Fields should be held responsible for the amount unpaid by MIS. According to the plaintiff, the defendant is liable for MIS' debts because MIS acted as the agent of the defendant when rendering the services described above. (Pl. Brf. in Opp. at 3-5.) Because the work it performed for MIS was done at defendant's behest and on defendant's behalf, the plaintiff insists that privity of contract exists between Enterprise Press and Fresh Fields. Specifically, plaintiff claims that privity exists because all the work that it performed for Fresh Fields allegedly was ordered, discussed, reviewed, and altered by defendant's employees or agents, and because all of the finished products made by plaintiff for defendant's use were shipped directly to the defendant. Id. at 1-3. Furthermore, plaintiff claims that privity of contract and an agency relationship exist because of the actions of Thomas Wilson, a member of the Board of Directors of both MIS and Fresh Fields. Wilson allegedly led plaintiff to believe that the defendant was aware that the plaintiff ultimately would look to Fresh Fields for payment of all amounts billed to MIS for work that the plaintiff performed to the benefit of the defendant. Id. at 3.

 Fresh Fields maintains that it is not liable to Enterprise Press for the debts of MIS. The defendant was not a party to any contract between MIS and Enterprise Press and did not have an account with the plaintiff. (Dobrow Affvt. at 2). Neither did the defendant enter into any settlement agreement with plaintiff, nor authorize MIS to enter into any settlement on its behalf. Id. Furthermore, the defendant maintains that it paid MIS in full for all services rendered and printed matters received in 1994. During the period in dispute, the defendant paid MIS $ 275,516.32. Id. at 3-4. ...


 Rule 56(c), F.R. Civ. P. provides that summary judgment is appropriate where "... there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law." If the moving party meets its burden to show the absence of a material factual dispute, the burden shifts to the non-moving party to "set forth specific facts showing that there is a genuine issue for trial." Rule 56(e), F.R. Civ. P. While the court is to draw all reasonable inferences in support of the non-moving party, Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59, 26 L. Ed. 2d 142, 90 S. Ct. 1598 (1970), the court should not be reluctant to grant summary judgment in cases where an element essential to prove the non-moving party's case is factually unsupported in the record. Celotex Corp. v. Catrett, 477 U.S. 317, 322-24, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986).

 The burden upon the plaintiff, the non-moving party in this case, is to produce factual support sufficient to establish the existence of an agency relationship between the defendant and MIS. If MIS is best classified as an agent of Fresh Fields, rather than as an independent contractor, then there is a basis in law for holding the defendant liable for MIS' debts. As a general rule, a principal is liable for all obligations incurred by his agent within the course of his employment. 2 N.Y.Jur., Agency and Ind. Contractors, § 239. The principal is bound by and liable for actions taken by his agents, regardless of whether the agent acts with the actual or apparent authority of the principal, and whether the agency relationship is express or implied. Id. at §§ 22, 81, ...

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