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Haskell Co. v. Radiant Energy Corp.

September 19, 2007


The opinion of the court was delivered by: Dora L. Irizarry, U.S. District Judge


Plaintiff The Haskell Company ("Haskell" or "plaintiff") filed this diversity action against defendants Radiant Energy Corporation ("REC") and Radiant Aviation Services, Inc. ("RAS") (collectively, "defendants") alleging breach of an oral contract, unjust enrichment, quantum meruit, and account stated. Defendants move, pursuant to Fed. R. Civ. P. 12(c), to dismiss all of plaintiff's causes of action for failure to state a claim and for lack of personal jurisdiction based on deficient service. Defendants also urge the court to convert the motion to one for summary judgment and to evaluate it pursuant to Fed. R. Civ. P. 56. For the following reasons, defendants' motion to dismiss isconverted to a motion for summary judgment and is granted in part and denied in part.

Conversion to Summary Judgment Motion

Hoping to dispose of the case without the need for costly discovery, defendants strongly urge the court to consider matters outside the pleadings, namely affidavits submitted by Colin V.F. Digout, Maryanne Digout, Timothy P. Seel, a declaration of Steve V. Suneson and an affidavit by Joe Narby, on behalf of plaintiff. Defendants have also submitted a Local Rule 56.1 Statement of Material Facts, which is essentially a summary of the various affidavits submitted by defendants, without the benefit of deposition transcripts, interrogatory responses or plaintiff's documents since no discovery has taken place. To consider matters extrinsic to the pleadings, the court must convert defendants' motion for judgment on the pleadings into a motion for summary judgment, and determine the motion on the basis of the admissible evidence submitted by the parties. See Sellers v. M.C. Floor Crafters, Inc., 842 F.2d 639, 642 (2d Cir.1988).

A court may not convert a motion made under Rule 12 into a motion for summary judgment without the opposing party receiving adequate notice and being afforded an opportunity to respond. See, e.g., Groden v. Random House, Inc., 61 F.3d 1045, 1052 (2d Cir. 1995). A party is deemed to have notice that a motion may be converted into one for summary judgment if that party "should reasonably have recognized the possibility" that such a conversion would occur. Gurary v. Winehouse, 190 F.3d 37, 43 (2d Cir. 1999). In this case, the court finds that plaintiffs have been provided adequate notice and opportunity to respond.

First, defendants attached to their motion extensive materials that were not included in the pleadings, plainly putting plaintiff on notice of the likelihood of a conversion. Sira v. Morton, 380 F.3d 57, 63 (2d Cir. 2004). Second, the notice of motion stated defendants' intention to seek a conversion. Aetna Cas. and Sur. Co. v. Aniero Concrete Co., Inc., 404 F.3d 566, 573-574 (2d Cir. 2005) (the fact that motion states that party seeks summary judgment in the alternative is factor in determining if plaintiff had notice). Moreover, plaintiff itself submitted extrinsic materials (namely the affidavit of Joe Narby), and plaintiff makes reference to summary judgment in its legal memorandum. See Carione v. U.S., 368 F. Supp. 2d 186, 191 (E.D.N.Y. 2005) ("where the non-movant responds to the motion by filing his own affidavit and specifically addressing the summary judgment argument in his memorandum of law in opposition, the non-movant has sufficient notice that the court might treat the motion as one for summary judgment.").

Plaintiff objects to converting the motion to one for summary judgment because it has not had the opportunity to seek discovery. See Plaintiff's Memorandum of Law in Response to Motion to Dismiss ("Pl. Memo") 1 n.1. The timing of the motion so soon after the filing of the complaint is of no moment since summary judgment may be sought at any time after a pleading is served. Id. However, as plaintiff points out, caution should be exercised in granting summary judgment when the non-moving party lacks relevant discovery. Flaherty v. Coughlin, 713 F.2d 10, 13 (2d Cir. 1983). While the court may take into account the existence of material issues of fact and deny summary judgment as premature, the lack of discovery, per se, is not a ground to deny a conversion of which the opposing party had notice and was given ample opportunity to answer.*fn1 Plaintiff could have used the lack of discovery as a ground to resist summary judgment. See Fed. R. Civ. P. 56(f). A lack of discovery is not, however, a ground to resist a conversion, especially where, as here, the non-moving party has not submitted an affidavit attesting to what discovery is needed. See Concourse Rehabilitation & Nursing Center Inc. v. Whalen, 249 F.3d 136, 146 n.3 (2d Cir. 2001) (granting summary judgment where a party failed to submit an affidavit attesting to its need for additional discovery). Here, plaintiff's objection to the conversion due to lack of discovery amounts to no more than a passing reference in a footnote, which also states that it submitted an affidavit of additional facts in opposition to the summary judgment motion. Accordingly, defendants' motion for judgment on the pleadings is converted to one for summary judgment.


On November 8, 2001, Colin Digout and Tim Seel, on behalf of defendants, and Jess Simmons and Joe Narby on behalf of plaintiff, met at defendants' headquarters to discuss whether to enter into a business relationship.*fn2 Statement of Material Facts Pursuant to Rule 56.1 ("Rule 56.1 Stat.") ¶ 1; Affidavit of Joe Narby ("Narby Aff.") ¶ 2. As part of the business relationship, plaintiff was to provide, for an as yet undetermined fee, engineering and planning services to defendants to assist in the design and construction of de-icing systems. Id. On November 28, 2001, plaintiff sent defendants a letter proposing how the de-icing system could be marketed and financed. Rule 56.1 Stat. ¶ 2. One potential customer was John F. Kennedy International Airport ("JFK"), managed by the Port Authority of New York and New Jersey ("Port Authority"). Id ¶ 5. Although the Port Authority was interested, actual approval of the plan required several additional steps, including obtaining funding and obtaining the approval of the Port Authority board. The Port Authority wanted to work only with one contractor. Thus, plaintiff and defendants entered into discussions whereby plaintiff was to be defendants' sub-contractor. Id. The contract for construction of the facility was to be between defendants and the Port Authority. Id. ¶ 6.

According to plaintiff, during the second half of 2002, plaintiff entered into an oral agreement with defendants whereby plaintiff was to engineer, design and construct the de-icing facility at JFK on behalf of defendants. Narby Aff. ¶ 3.The Port Authority invited defendants to give a presentation on how they would construct the facility at JFK. Rule 56.1 Stat. ¶ 7. Defendants invited plaintiff to participate. Id. On October 18, 2002, Ian Sharkey on behalf of defendants, and Simmons and Narby on behalf of plaintiff attended a meeting with Port Authority officials.*fn3 Narby Aff. ¶ 4; Rule 56.1 Stat. ¶ 8. Sharkey is an account manager for defendant REC and was not an "executive officer" of defendants. Id. The minutes of the meeting state that "Haskell Co., as the agent appointed contractor of RAS, will perform the engineering, design and construction of the Radiant deicing pads including the foundations." Narby Aff. Exhibit 1. The Port Authority's minutes encourage the meeting participants to "supplement, clarify or add to these [minutes] or one shall be deemed to have agreed to the contents." Id.

After the October 18, 2002, meeting, the parties continued to negotiate the pricing structure of their contract. Rule 56.1 Stat. ¶ 9. Defendants favored giving plaintiff a percentage of the gross fee received from the Port Authority while plaintiff favored being paid a straight fee for engineering services. Rule 56.1 Stat. ¶ 9. According to defendants, plaintiff performed a cost-analysis to see whether a percentage of the gross fee would be profitable. Id. at 11. Defendants provided plaintiff with detailed cost estimates to aid the cost-analysis. Id. At the same time, plaintiff alleges that it began substantive engineering work that was needed to construct the facility, including contacting subcontractors and vendors and "performing electrical load calculations for emergency generator sizing and performed calculations for footing sizing based on reactions supplied by the metal building manufacturer." Narby Aff. ¶ 7. Plaintiff also provided defendants updates on its work, including budgets and technical information. Id. at ¶ 8.

In June 2003, plaintiff presented an agreement to defendants governing their cooperation on the JFK project. Rule 56.1 Stat. ¶ 13; Exhibit D to the Affidavit of Colin V.F. Digout. The "Joint Agreement" expresses the parties' desire to contract and to "design and construct the Project in accordance with a Contract Agreement to be attached hereto as Exhibit A." Id. The Joint Agreement contained a merger clause which prohibited subsequent agreements from altering any prior written agreement. Id. The agreement was never signed because the parties could not come to an agreement on the price term. Rule 56.1 Stat. ¶ 16-17. After the agreement fell apart (sometime after June 2003), the parties did not have any significant contact. Id. at 17. The Port Authority awarded defendants the contract in June 2004 based on a proposal submitted by defendants in early 2004. Id at 18-19. Another firm (not plaintiff) performed the design and engineering work for the project. Id.

On July 22, 2004, plaintiff began to invoice defendants for the work performed in connection with the project. Narby Aff. ¶ 10; Rule 56.1 Stat. ¶ 21-22. Defendants did not object to the invoices. Narby Aff. ¶ 11-12. Plaintiff and defendants discussed the invoices, and defendants offered to pay so as not to jeopardize the project or their relationship with the Port Authority. Rule 56.1 Stat. ¶ 23-24. After defendants and the Port Authority entered into a contract in February 2005, defendants asked if plaintiff wished to act as defendants' general contractor. Rule 56.1 Stat. ¶ 25-27. Plaintiff declined. Rule 56.1 Stat. ¶ 28-29.

Service of Process

On October 6, 2005, plaintiff personally served defendant REC through Mary Digout, the wife of Colin Digout, at their home, 721 Sugarloaf Street in Port Colborne, Ontario, Canada. Rule 56.1 Stat. ¶ 31; Affidavit of Christine M. Fecko ("Fecko Aff") Exhibit A. According to plaintiff, Mary Digout stated that she was "in care and control of Radiant Energy Corporation." Id. Defendants deny that Mary Digout ever represented that she was authorized to accept service for REC. Rule 56.1 Stat. ¶ 31. The REC's business address at the time was 176 Saint Catharine, Port Colborne, Ontario, Canada, not Colin Digout's home. Id. at 32. Mary ...

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