The opinion of the court was delivered by: Motley, District Judge.
This case involves a contractual dispute regarding a rental
agreement for a commercial aircraft. Plaintiff has moved for
summary judgment. For the reasons outlined below, the court now
grants partial summary judgment for plaintiff regarding the rent
shortfall and denies summary judgment regarding the rent
resetting costs and attorneys' fees.
This case involves rental payments under a lease for a
commercial aircraft. Defendant, America West Airlines ("America
West") has been leasing a Boeing 757 aircraft from plaintiff,
Echelon International Corp. ("Echelon") since 1989. In 1991
America West filed for bankruptcy. At that time Echelon and
America West renegotiated the aircraft lease, lowering the basic
rental rate from $400,000 to $315,000 per month. The terms of
the renegotiation allowed this basic rental rate to be adjusted
on three future rent reset dates to reflect the fair market
value of such rental. The renegotiation set the following
procedure for determining the fair market rental if the two
parties could not agree: each party would select an appraiser to
estimate the fair market rental; if the parties' appraisers
could not agree the two appraisers would select a third
independent appraiser; the determination of the third appraiser
As the rental reset date of March 10, 1998 approached, the
parties could not agree upon a fair market rental rate. In
keeping with the reset procedure, each party selected an
appraiser to estimate the fair market rental. Echelon's
appraiser, Morton Beyer, quoted a fair market rental rate of
$395,000 per month. America West's appraiser, Avitas, quoted a
monthly rental rate of $280,000. As provided in the
renegotiation procedure if the parties' appraisers could not
agree, a third appraiser was commissioned to determine the fair
market rental. The two appraisers, by
mutual assent, selected a third independent appraiser, GRA
Aviation specialists ("GRA"). GRA appraised the fair market
rental at $354,000 per month. Thus, Echelon contends that the
rent was properly reset to $354,000 per month.
Despite GRA's appraisal, America West has continued to pay
only $315,000 per month. Plaintiff seeks to recover this rent
shortfall of $39,000 per month (the difference between $354,000
and $315,000) as accruing since March of 1998.
Plaintiff also seeks to recover all fees and expenses incurred
during the rent resetting process as well as its legal fees and
expenses arising from this litigation. Echelon contends that the
lease agreement required America West to shoulder all costs
related to the rent resetting process and all legal fees from
any resulting litigation.
STANDARD FOR SUMMARY JUDGMENT
This circuit recognizes the value of summary judgment to
expeditiously dispose of meritless litigation. See Quinn v.
Syracuse Model Neighborhood Corp., 613 F.2d 438, 445 (2d Cir.
1980). The mechanism of summary judgment promotes judicial
economy by preventing further litigation on an issue with an
unalterably predetermined outcome. The standard for summary
judgment ensures that issues are efficiently resolved without
compromising the rights of the non-moving party.
Summary judgment may be granted only if the moving
party can show that there is no genuine issue as to
any material fact and that the moving party is
entitled to a judgment as a matter of law. The court
must draw all reasonable inferences and resolve all
ambiguities in favor of the non-moving party.
Ametex Fabrics, Inc. v. Just In Materials, Inc., 140 F.3d 101,
107 (2d Cir. 1998) (internal citations omitted). Thus, the mere
existence of a factual dispute between parties does not preclude
summary judgment when the dispute is not genuine or when the
disputed facts are immaterial. A disputed fact is immaterial
when the outcome of the case remains the same regardless of the
disputed issue. Factual questions which prove immaterial fail to
preclude summary judgment. See Knight v. U.S. Fire Insurance
Co., 804 F.2d 9, 11 (2d Cir. 1986) (noting that the existence
of unresolved immaterial issues does not suffice to defeat a
motion for summary judgment).
A party may not rely on "mere speculation or conjecture as to
the true nature of the facts to overcome a motion for summary
judgment". Knight v. U.S. Fire Insurance Co., 804 F.2d 9, 11
(2d Cir. 1986).
Nor are judges any longer required to submit a
question to a jury merely because some evidence has
been introduced by the party having the burden of
proof, unless the evidence be of such a character
that it would warrant the jury in finding a verdict
in favor of that party. Formerly it was held that if
there was what is called a scintilla of evidence in
support of a case the judge was bound to leave it to
the jury, but recent decisions of high authority have
established a more reasonable rule, that in every
case, before the evidence is left to the jury, there
is a preliminary question for the judge, not whether
there is literally no evidence, but whether there is
any upon which a jury could properly proceed to find
a verdict for the party producing it, upon whom the
onus of proof is imposed.
Anderson v. Liberty Lobby Inc., 477 U.S. 242, 251, 106 S.Ct.
2505, 91 L.Ed.2d 202 (1986) ...