-- against

& GENERAL CONTRACTING, LLC,

Third Party Plaintiff,

unknown to Plaintiff and intended to bepersons or entities, if any, being in possession orhaving a right of possession in and to the premisesdescribed in the Complaint,

Defendants.

TERRA FIRMA CONSTRUCTION MANAGEMENT

#lo, the last 10 names beingfictitious and #l through “JOHN DOE”

& HEATING, INC., “JOHN DOE ”

& GENERAL CONTRACTING, LLC, HUNTS POINTMULTI-SERVICE CENTER, INC., UNITED STATESFIDELITY AND GUARANTY COMPANY a/k/aST. PAUL FIRE AND MARINE INSURANCECOMPANY, BROOKVILLE ENTERPRISE, INC.,AS A PLUMBING

-xx x

TERRA FIRMA CONSTRUCTION MANAGEMENT

- against

& 016012,013,014,015 10,O 11,

l/2003MOTION SEQUENCE: 0

03/3 008884/1999

MOTION DATE:

& SONS, INC.,

Plaintiff,INDEX NO.:

TRIAL/IAS PART 20

J. SACKARIS

- STATE OF NEW YORKCOUNTY OF NASSAU

PRESENT:HON. IRA B. WARSHAWSKY,

Justice.

SCA NSHORT FORM ORDER

SUPREME COURT

-2-

Inc........ 32Memorandum of Law in Reply to Motion of Terra Firma.. ................................................. 33

Jnc .... 31Exhibits to Motion by Third Party Defendant Hunts Point Multi-Service Center,

& Affidavits.. ................................................................................................... 29Rule 19-a Statement of Material Facts ................................................................................. 30Memorandum of Law of Third Party Defendant Hunts Point Multi-Service Center,

& Exhibits Annexed............................................................... 28Notice of Motion by Third Part Defendant Hunts Point Multi-Service Center, Inc.,Affirmation

& Exhibit Annexed.. ........................................................... 27Affidavit of Bruce Covahey

& Exhibits Annexed.. ...................... 26Affidavit of Brenda J. Harling

& Sons, Inc.. .................... 22Reply Affirmation in Support of Partial Summary Judgment............................................. 23Rule 19-a Statement of Contested Facts .............................................................................. 24Rule 19-a Statement of Material Facts ................................................................................. 25Affirmation of David Westermann, Jr. in Opposition

& Exhibits Annexed................................................................................ 21Memorandum of Law in Opposition to Motions of J. Sackaris

.......................................................................19Exhibits to Terra Firma ’s Motion for Summary Judgment and Related Relief.................. 20Notice of Motion, Affidavit, Affirmation, Memorandum of Law, Rule 19-a Statementof Material Facts

& Exhibits Annexed..

& Exhibits Annexed ...... 13Statement Pursuant to Rule 19-a of the Commercial Division.. ........................................ 14Counter-Statement to Hunts Point Multi-Service Center ’s Rule 19-a Statement.............. 15Counter-Statement to Breger-Terjesen Associates Rule 19-a Statement.. ......................... 16Counter-Statement to Plaintiffs Rule 19-a Statement....................................................... 17Terra Firma ’s Memorandum of Law in Opposition to the Omnibus Motions................... 18Affirmation in Reply

& Exhibits Annexed.. .................................. 11Terra Firma ’s Memorandum of Law inSupport............................................................... 12Affirmation in Opposition to Motions for Sanctions, Affidavit

& Exhibits Annexed .................................... 9Amended Notice of Motion .............................................................................................. 10Notice of Motion, Affirmations, Affidavits

& Exhibit Annexed.. .................................................................... 8Notice of Motion, Affirmations, Affidavits &u-Reply Affirmation

& Exhibits Annexed ..... 5Reply Affirmation in Further Support of Plaintiffs Motion............................................ 6Memorandum of Law in Further Support of Plaintiffs Motion.. ..................................... 7

& Exhibit Annexed ............ 4Affirmation in Opposition to Defendant Terra Firma ’s Motion

USF&G ’s Motion

& Exhibits Annexed.. ................................... 1Rule 19-a Statement of Material Facts ............................................................................. 2Memorandum of Law in Support of Plaintiffs Motion................................................... 3Affirmation in Opposition to Defendant

BREGER-TERJESEN ASSOCIATES and HUNTSPOINT MULTI-SERVICE CENTER, INC.,

Third Party Defendants.

The following papers read on this motion:

Notice of Motion, Affirmation, Affidavits

-3-

130- 1.1 striking plaintiffs complaint for$ 3 126 and 22 NYCRR

$37,720.74, and for an

order pursuant to CPLR

& General

Contracting LLC (Terra Firma) for summary judgment dismissing the complaint or, in the

alternative, for an order limiting plaintiffs damages to the sum of

& Hiller PC, for

engaging in frivolous conduct, and

II: the motion by defendant United States Fidelity and Guaranty Company, a/k/a

St. Paul Fire and Marine Insurance Company, (St. Paul), for an order pursuant to CPLR

32 12 granting partial summary judgment against plaintiff limiting liability to the penal

amount of the Discharge Bond, and

III: the motion by defendant, Terra Firma Construction Management

29,2002, and for sanctions against

defendants Terra Firma, St. Paul and counsel for those defendants, Weiss

$342,200.00, for a further order striking the answers of

defendants Terra Firma and St. Paul and precluding the aforesaid defendants from

introducing any evidence produced after August

tune to nunc pro

5 137, a claim for

punitive damages for bad faith relative to the Payment Bond and a claim to increase

plaintiffs lien

$346,200.00 plus interest, attorney fees and punitive damages, or, in the

alternative for summary judgment on the issue of liability and an inquest as to damages,

and for an order granting leave to serve an amended complaint asserting a claim under a

Payment Bond, a claim for counsel fees under State Finance Law

& Exhibit Annexed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

I: The motion by plaintiff, Sackaris, for an order granting summary judgment in

the amount of

USF&G . . . . . . . . . . . . . . . 38Reply Affirmation in Further Support of Breger-Terjesen Motion forSummary Judgment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39Affirmation in Sur-Reply of Terra Firma

& & General Contracting LLC

& Exhibits Annexed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36Rule 19-a Statement of Material Facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37Affirmation in Opposition to Motions for Summary Judgment of the DefendantTerra Firma Construction Management

& Exhibits Annexed...... 35Notice of Motion, Affidavit

... 34Affirmation in Reply by Hunts Point Multi-Service Center, Inc.

li-rc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Affirmation in Partial Opposition by Third Party Defendant Hunts Point Multi-ServiceCenter,

-4-

& Sons, Inc.

(Sackaris), on October 20, 1997, for excavation and cement work for a nursing home

$265,000.00. Defendant Terra Firma counter claimed for

breach of contract and breach of a common law duty of care.

Defendant/third party plaintiff, Terra Firma commenced a third party action

against Breger-Terjesen and Hunts Point asserting that they had both wrongfully denied

approval of a change order, or orders, for extra excavation work performed by Sackaris

and, in the event it was determined that Sackaris quit the site by reason of such wrongful

denial, liability against the third-party defendants is sought for the resulting damages.

The issue driving this litigation is whether plaintiff contracted to excavate

subsurface hard rock.

FACTS

Terra Firma, as the general contractor, retained J. Sackaris

damnun clause is

for the amount of the Bond,

tune ’ a defense of accord and satisfaction, and for an order pursuant to CPLR

3 126 dismissing the third party complaint on the grounds that defendant/third party

plaintiff, Terra Firma, failed to produce discovery are all determined as follows.

Plaintiff commenced this action to foreclose on a lien for material and labor

supplied on a construction project known as Hunts Point Multi-Service Center in the

Bronx. Plaintiff seeks to recover on the Discharge Bond posted by St. Paul as surety for

defendant, Terra Firma, the general contractor on the project. The ad

nunc pro

surnmary judgment, for an

order pursuant to CPLR 3025(b) granting leave to serve an amended answer asserting

summary judgment dismissing the third party

complaint and all cross-claims, and

V: the motion by third party defendant Hunts Point Multi-Service Center, Inc.,

(Hunts Point), for an order pursuant to CPLR 3212 granting

failure to comply with discovery demands and requiring plaintiff to appear for another

oral examination before trial, and

IV: the motion by third party defendant, Breger-Terjesen Associates, for an

order pursuant to CPLR 32 12 granting

-5-

$6,500.00, on the reasoning

that the Terra Firma-Hunts Point contract (the Prime Contract) provided for hard rock,

Terra Firma was bound to the Prime Contract where excavation for hard rock was

included and therefore hard rock should also have been included in the Purchase Orders.

Sackaris would not accept the sum, nor would Terra Firma. Sackaris was instructed to

keep digging and submit change orders.

Eventually, apparently to keep the project moving, on May 22 1998, Hunts Point

offered and Terra Firma agreed to settle the matter of change orders for hard rock

excavation for the enlarged sum of $50,000. The sum included all past and future cost

over runs for excavation solely as a result of the subsurface condition, even though

(CO#2

for machinery) from Breger-Terjesen who approved only

28,1998. It incorporates the terms of the Prime Contract between Hunts

Point and Terra Firma.

The Prime Contract between Terra Firma and Hunts Point included the cost of

excavation of all contingencies. The October 1997 Purchase Orders between Terra Firma

and Sackaris required Sackaris to do excavation pursuant to the contract with Hunts Point

but excluded therefrom any excavation requiring special machinery. The sub-contract

provided, in pertinent part, for plaintiff to undertake “removal of rock etc. . . . providing

the removal can be accomplished without special equipment or methods, i.e. air ram, drill

and blasting, jack hammers. ”

Sackaris started work in December of 1997; after a few days Sackaris discovered

that there was a hard rock subsurface condition which required different equipment and

different methods for excavating the foundation.

Terra Firma sought approval of the first change order dated January 1998,

project being built by Hunts Point. The accepted bid was $250,000 for concrete work and

$170,000 for excavation. Two purchase orders confirm the agreement. The construction

was. being funded through Chase Bank and DASNY, and required approval from the New

York State Department of Health. A TF 1.1 Contract was executed by Sackaris and Terra

Firma on April

-6-

1,462.49 on June 3, 1998. In

July of 1998, Terra Firma obtained a discharge bond for the lien from St. Paul (who had

also issued a Payment Bond for Terra Firma) in the penal sum of $265,000 to include

pre-judgment interest and costs. This action was commenced on April 9, 1999, to

foreclose on the lien.

Of collateral significance is the fact that on April 24, 1998 Sackaris asserted a

claim under the payment bond for work unpaid by Terra Firma. The claim was

acknowledged and was fielded back and forth “through channels, ” being finally rejected

on February 10, 1999, in a position letter authored by Terra Firma ’s present counsel. In

sum and substance it opines that Sackaris should not be paid because it quit work and that

it had no right to quit work because of unpaid change orders (which were to be settled

after completion of all work), and that in any event Sackaris was negligent in the

performance of its work. The exact statement of Michael Hiller, on behalf of Terra Firma

was as follows: “the unambiguous language of the Contract required that J. Sackaris

complete the job before making a claim against Terra Firma or the owner. By abandoning

the job well prior to completion, J. Sackaris breached the contract and forfeited any right

to obtain payment thereunder or under the theory of quantum meruit. ” This remains the

$170,000), plus change orders for hard rock. An attempt at a

settlement between Sackaris and Terra Firma took place; Sackaris demanded $122,000,

Terra Firma offered $100,000, which was rejected. Momentum on the site had largely

fizzled, no resolution to the dispute was forecast and Sackaris was terminated in writing

on May 26, 1998. Sackaris filed a lien in the amount $23

recieved only $82,000 in payment, but had,

allegedly, completed 75% of the concrete work (on the bid of $250,000) and 70% of the

excavation (on the bid of

plaintiff had already submitted invoices, or change orders in the amount of $122,000 for

extra labor and machinery for excavation.

Terra Firma received the aforesaid amount, with the blessings of DASNY and

DOH, and told Sackaris that it should continue to work and continue to submit change

orders. About this time Sackaris had

-7-

A.D.2d 736 (3d Dept) (movant in action& Home Maintenance ,296

& 11. See, LHV Precast Inc.

v Woodstock Lawn

4(l), 9, 10 05

A.D.2d 545 (3d Dept 1991).

DISCUSSION

There is little difficulty granting plaintiffs motion to enter judgment on the lien.

Plaintiff has submitted proof that defendant Terra Firma is in breach of its contract with

plaintiff by failing to pay plaintiff for the contract work performed pursuant to the

concrete purchase order, failing to pay plaintiff for the excavation work performed under

the excavation purchase order, and failing to pay for “hard rock ” excavation directed by

Terra Firma. Plaintiff has established the lien amount pursuant to the particularization

the lien.

Although less prolix on this subject than others the proof submitted by plaintiff

of

establishes that the lien conforms to Lien Law

Anable v Bolentin, 175

N.Y.2d

276;

Swift v Muller Construction Co, 46 & N.Y.2d 557; Alvord

A.D.2d

5 16 (3d Dept 199 1). Conclusions and unsubstantiated allegations or assertions are

insufficient to raise a triable issue of fact and defeat summary judgment. Zuckerman v

City of New York, 49

N.Y.2d 1065 (1979).

Once a prima facie showing is made by the proponent, the burden shifts to the

party opposing the motion to rebut the movant ’s case by making an evidentiary showing

that material issues of fact exist and must lay bare affirmative proof that matters are real

and capable of being established at trial. See Del Giacco v Noteworthv Co., 175

Mfgs., 46

evident&y proof in admissible form. See Friends of Animals,

Inc. v Associated Fur

N.Y.2d 395

(1957). In order to prevail the movant must establish his cause of action or defense in a

manner sufficient to warrant entry of judgment as a matter of law. The case must be

established by tender of

Sillman v Twentieth Centnrv-Fox Film Corn., 3

defense to date. Having failed to sue on the Performance Bond within one year and

having elected to proceed on the Discharge Bond plaintiff is barred from so doing now.

On a motion for summary judgment, the court must engage in issue finding rather

than issue determination.

-8-

N.Y.2d

969 (1984). The proof shows that plaintiffs work was accepted and approved by the

owner, the architect, and DASNY and that Terra Firma was paid but did not turn over the

payment to plaintiff and that plaintiff was terminated from the job a few weeks after it

determined not to work without getting paid.

The other causes of action contemplated by plaintiff are irrelevant and need not be

examined by this court as plaintiff shall not be permitted to amend the complaint four

years after commencing the action, almost to the date, and only a few weeks before trial

was to commence. No excuse is given for the delay. Moreover a claim under the Payment

Bond is Time barred and asserting a claim in quantum meruit now, at the close of

discovery, would be prejudicial.

Plaintiffs remaining requests for relief in the nature of sanctions for complained

of discovery abuses and dilatory conduct can be generically addressed. All such claims,

by any party to this lawsuit, are denied. To the view of the court there has not been

frivolous conduct as defined by 22 NYCRR 130-l. 1. True there have been forays into

1,426.49 and plaintiff is limited to recovery of that amount in this action to

foreclose on a lien. Tri-City Electric. Inc. v People of the State of New York, 63

$346,200.00

together with interest is the reasonable amount due and owing. However the amount of

the lien is $23

Alicea (former project manager for

Terra Firma), Robert Sackaris and Richard Pierce (project manager for Breger-Terjesen)

attest to the fact that plaintiff performed the work as set forth in the notice of Lien.

Plaintiff has likewise submitted competent proof that the sum of

20th and completed a substantial portion of the

contract, that it submitted requisitions and changed orders, that the requisitions were

approved by Terra Firma and that plaintiff was paid but $82,000 on a $450,000 contract

less 10% retainage. In addition affidavits by Messers.

27th to May

to foreclose lien has burden of setting forth evidence to establish the existence of a valid

lien.) The record is replete with letters, records, the purchase orders, minutes of

meetings, requisition slips and change orders that show that plaintiff worked on the

subject site from December

-9-

70-75% of the work

performed since November, stopped manning the job in May. Terra Firma cannot

persuasively argue that plaintiff was bound to excavate hard rock under the sub-contract

and Prime Contract when Terra Firma itself accepted $50,000 for change orders for hard

rock excavation. Virtually every affidavit in the record, save defense counsel ’s,

acknowledges that hard rock was in the Prime Contract but not in the sub-contract. There

uncharted areas of the absurd and there has been back biting and devilment adequate to

make a school master quiver. However, this appears to be a personal matter between

counselors. It does not affect the merits of the litigation and therefore is not an issue

determinable by this court whose only mission is to determined whether the facts support

recovery by plaintiff under the law. Whether any of these acts would be of interest to the

Grievance Committee the court will leave up to each party to make the appropriate

complaint.

Since plaintiff has established a prima facie case that it did the work and extra

pursuant to it ’s contract and has not been paid, it has established a valid lien and the

burden shifts to defendant Terra Firma to raise a triable issue of fact. In opposition

defendant, documents -- meticulously -- plaintiffs discovery abuses. The consequences

of such conduct, it is argued, mandates dismissal of the complaint, irrespective of the

facts. As to the facts, those argued by defendant are directly inapposite to the

documentary proof in the record, are only rarely supported by an affidavit by a person

with knowledge, and do not impugn the integrity of the lien filed by plaintiff. After all,

an action to foreclose on a lien requires approximately the same proof as a cause of action

for breach of a contract, only the burden of proof is somewhat different. Rather than

prove that the opponent did not perform its promised obligation, plaintiff must establish

that it performed so much of its obligation as is claimed in the lien. The record now

before me is rife with first hand evidence that it did. Nothing supports Terra Firma ’s

claim that the work was defective, or that plaintiff was in breach first, before defendant

terminated the contract. Plaintiff having not gotten paid for

-lO-

People of the State of New York, supra.Accordingly, the burden shifts to defendant

Terra Firma or plaintiff to raise a triable issue of fact. Neither party has shown any fact

which under the law permits an increase in the amount of a bond four years after suit is

commenced and five years after the lien was filed.

Accordingly, defendant St. Paul is granted partial summary judgment on the issue

of limiting liability on the bond to the penal sum.

Third party defendant Breger-Terjesen was the architect pursuant to the contract

with the owner, co-third party defendant, Hunts Point Multi Service Center Inc. (Hunts

Point). Among its responsibilities, it was to be consulted on any change order, or any

other issues arising during construction, and to give an impartial opinion about the

G.O.L.5 7-301; Tri-Citv Electric. Inc. v

1,462.49. Defendant ’s motion

for summary judgment is denied.

Defendant St. Paul moves to limit its liability to the penal sum under the discharge

bond. Defendant has established that it has caused no breach of its contractual

undertakings in the Discharge Bond and that the fixed penal limit of said Bond cannot be

increased beyond the limit stated in the Bond.

1,462.49.

Accordingly, plaintiff is granted summary judgment on the first cause of action for

a valid lien, on the second cause of action to recover on the Discharge Bond, and on the

third cause of action for balance due on the contract of $23

$196,099.99, less amount paid $82,000 equals balance due of $23

$118,162.50, Excavation work

completed

is no legible copy of the Marathon purchase order before the court for comparison, but it

appears that plaintiff did most of the excavation work at the behest of the contractor.

Last, the court rejects any argument that Sackaris should wait to get any payment on the

contract until the change orders were resolved in a contract fashioned by Terra Firma. A

“paid when paid ” clause has been held unlawful and in any event the requisitions were

approved.

Plaintiffs itemization of the lien claims the following and the records found in the

motion confirm the claim: Concrete work completed

-ll-

Firma also asserts that Breger-Terjesen breached its

duty of impartiality and showed favoritism to the owner, Hunts Point, in denying the

change order.

Breger-Terjesen posits that it ’s architectural plans and specifications address the

issue of excavation of the foundation and include all excavation, including removal of

hard rock to be undertaken by the excavation subcontractor, and is included in the

contract for labor and materials negotiated by Terra Firma for the benefit of the owner

Hunts Point. Having so said, Breger-Terjesen concedes an issue as to whether the

contract between plaintiff and Terra Firma includes hard rock excavation. When

presented with the issue Breger-Terjesen remained mindful of its duty to impartially

interpret the contract and make determinations on disputes between the owner and the

general contractor.

Breger-Terjesen acknowledges that a Boring Survey it caused to be conducted

indicated the presence of rock in a subterranean state at the project without a finding as to

degree of hardness. After reviewing the contract between the owner and the general

contractor and again consulting with the engineer on the Boring Survey, Breger-Terjesen

made a decision that the excavation was to be done without a change order for hard rock.

However, in light of the fact that Terra Firma ’s contract with plaintiff was to the contrary

it proposed a change order of $6,500. As stated above when Hunts Point negotiated with

Terra Firma to pay an additional $50,000 for hard rock excavation the opinion of the

architect became moot.

validity of the claim. It was consulted in January 1997 by Terra Firma about the

discovery of hard rock under the sub soil after plaintiff began its work. The contractor,

Terra Firma, commenced the third party action on the theory that Breger-Terjesen had

denied in bad faith a change order for excavation of rock which was harder and of a

different classification than contracted for. If Terra Firma is liable for Sackaris ’s quitting

the job site, it is argued that Breger-Terjesen must be liable for its bad faith review and

rejection of the change order. Terra

17,2003

HuntsPoint; not only did Hunts Point

approve a $50,000 change order, and actually pay it, but also Terra Firma never turned it

over to Sackaris and now hopes to have Hunts Point pay the change order again!

Accordingly, the motion by third party defendant Hunts Point is granted.

All other requests for relief not expressly granted are denied. In sum it is

ORDERED and ADJUGED that plaintiff is granted summary judgment on the

complaint and the third party complaint is dismissed together with cross claims.

Dated: April

tune in an amended answer, the settlement of the change order for

hard rock excavation for $50,000 with Terra Firma and release of all claims between

them disposes of the matter. Liability is predicated upon a claim that Hunts Point

unreasonably refused to approve a change order for the extra costs of excavating hard

rock which would increase the cost of excavation between Sackaris and Terra Firma.

However, Sackaris can make no direct claim against Hunts Point, there is no privity of

contract, and as between Terra Firma and Hunts Point the cost of hard rock excavation

was conclusively resolved with the $50,000 agreement. The proof shows that there was

no other excavation change order submitted and rejected after the settlement. Finally, the

assertion is head-shakingly stupid as pointed out by

nunc pro

Breger-

Terjesen has shown it is entitled to summary judgment and the burden shifts to opposing

party to raise a triable issue of fact which in light of the settlement is academic.

The argument of co third-party defendant Hunts Point is similar. Although sought

to be asserted

Accordingly, third-party defendant Breger-Terjesen has established that it acted in

a reasonable and accepted manner for an architectural firm bound to mediate disputes

fairly and impartially between the owner of a construction project and the owner.